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DEBT
 12 Months Ended
Dec. 31, 2024
Debt Disclosure [Abstract]  
DEBT DEBT
As of December 31, 2024 and 2023, our total long-term debt and finance lease obligations are summarized as follows (in thousands):
December 31,
20242023
2022 ABL Credit Facility1
$112,671 $113,415 
ME/RE Loans1
22,119 24,061 
Uptiered Loan1
143,955 129,436 
Incremental Term Loan1
39,824 38,758 
Equipment Financing Loan
1,399 — 
Total 319,968 305,670 
Finance lease obligations2
5,143 5,756 
Total debt and finance lease obligations325,111 311,426 
Current portion of long-term debt and finance lease obligations(6,485)(5,212)
Total long-term debt and finance lease obligations, less current portion$318,626 $306,214 
_________________
1        Comprised of principal amount outstanding, less unamortized debt issuance costs. See below for additional information.
2        For information on our finance lease obligations see Note 12 - Leases.

The following table summarizes scheduled maturities of our debt for the years succeeding December 31, 2024 (in thousands):
December 31 
2025$5,666 
2026298,301 
202724,398 
2028— 
2029— 
Thereafter— 
Total1
$328,365 
1        The total excludes unamortized debt issuance cost of $8.4 million.

On March 12, 2025, we entered into certain debt refinancing transactions with our existing and new lenders, which resulted in:
•full payoff of the outstanding balance under Delayed Draw Term Loan,
•full payoff of the outstanding balance under the ME/RE Loans,
•full payoff of the outstanding balance under the Incremental Term Loan, and
•partial payoff of the outstanding balance under the Uptiered Loan.
Refer to Note 19 - Subsequent Events for additional details about the transactions.
2022 ABL Credit Facility
On February 11, 2022, we entered into a credit agreement, with the lender parties thereto, and Eclipse Business Capital, LLC, a Delaware limited liability company, as agent (the “ABL Agent”) (such agreement, as amended by Amendment No.1 dated as of May 6, 2022, Amendment No.2 dated as of November 1, 2022, Amendment No.3 dated as of June 16, 2023 (“ABL Amendment No. 3”), Amendment No.4 dated as of March 6, 2024 and Amendment No.5 dated as of September 30, 2024 (“ABL Amendment No.5”), the “2022 ABL Credit Agreement”).
Available funding commitments to us under the 2022 ABL Credit Agreement, subject to certain conditions, include a revolving credit line in an amount of up to $130.0 million to be provided by certain affiliates of the ABL Agent, with a $35.0 million sublimit for swingline borrowings, and a $26.0 million sublimit for issuances of letters of credit (the “Revolving Credit Loans”). We have fully drawn on the delayed draw term loan of $35.0 million (the “Delayed Draw Term Loan”) provided by Corre Partners Management, LLC (“Corre”) and certain of its affiliates, and on the ME/RE Loans (collectively, the Revolving Credit Loans, the Delayed Draw Term Loan and the ME/RE Loans, and the“2022 ABL Credit Facility”).
Our obligations under the 2022 ABL Credit Agreement are guaranteed by certain of our direct and indirect subsidiaries referenced below as the “ABL Guarantors” and, together with the Company, the “ABL Loan Parties.” Our obligations under the 2022 ABL Credit Facility are secured on a first priority basis by, among other things, accounts receivable, deposit accounts, securities accounts and inventory of the ABL Loan Parties (collectively, the “ABL Priority Collateral”) and are secured on a lower priority basis by substantially all of the other assets of the ABL Loan Parties, subject to the terms of the Intercreditor Agreement (as defined below). Availability under the revolving credit line is based on a percentage of the value of qualifying accounts receivable and inventory, reduced by certain reserves.
On September 30, 2024, the Company entered into ABL Amendment No.5 to the 2022 ABL Credit Agreement to, among other things:

(i) extend the scheduled maturity date from August 11, 2025 to September 30, 2027;

(ii) amend the applicable margin for Delayed Draw Term Loans from a flat rate of 10.00% for SOFR Loans (as defined in the 2022 ABL Credit Agreement) and 9.00% for Base Rate Loans (as defined in the 2022 ABL Credit Agreement) to a rate based on EBITDA ranging from 8.50% to 10.00% for SOFR Loans and 7.50% to 9.00% for Base Rate Loans;

(iii) amend the applicable margin for Revolving Credit Loans from a rate based on EBITDA ranging from 4.15% to 4.65% for SOFR Loans and 3.15% to 3.65% for Base Rate Loans to a rate based on both EBITDA and Average Historical Excess Availability (as defined in the 2022 ABL Credit Agreement) ranging from 3.50% to 4.25% for SOFR Loans and 2.50% to 3.25% for Base Rate Loans;

(iv) amend the applicable margin for ME/RE Loans from a flat rate of 5.75% for SOFR Loans to a flat rate of 5.00% for SOFR Loans;

(v) amend the definitions of “Borrowing Base” and “Consolidated Fixed Charge Coverage Ratio” as well as related definitions to expand availability under the Revolving Credit Facility (as defined in the 2022 ABL Credit Agreement);

(vi) add a springing financial covenant requiring Excess Availability (as defined in the 2022 ABL Credit Agreement) to be above $7,500,000 only if the Consolidated Fixed Charge Coverage Ratio falls below 0.85x for twelve-month periods ending on or prior to December 31, 2024 and 1.00x for twelve-month periods ending after December 31, 2024; and

(vii) amend the applicable prepayment premium for Delayed Draw Term Loans and ME/RE Loans from a rate ranging from 0% to 1% to a rate ranging from 0% to 2% based on the date of prepayment.

ABL Amendment No.5 was accounted for in accordance with ASC 470-60, Troubled Debt Restructuring, and no gain or loss was recognized. Amendment fees of $0.9 million related to the Revolving Credit Loans are deferred and amortized to interest expense over the term of the 2022 ABL Credit Agreement.
The terms of the 2022 ABL Credit Facility are described in the table below (dollar amounts are presented in thousands):
Revolving Credit LoansDelayed Draw Term Loan
Scheduled maturity date1
9/30/20279/30/2027
Stated interest rate
SOFR + applicable margin (base + applicable margin)SOFR + applicable margin (base + applicable margin)
Actual interest rate:
12/31/20248.92%14.17%
12/31/202310.11%15.46%
Interest paymentsmonthlymonthly
Cash paid for interest
12/31/2024$7,940$5,459
12/31/2023$6,984$5,317
Balances at 12/31/2024
     Principal balance
$77,905$35,000
     Unamortized balance of debt issuance cost
NA2
$(234)
      Net carrying balance
$77,905$34,766
Balances at 12/31/2023
     Principal balance
$78,415$35,000
     Unamortized balance of debt issuance cost
NA2
$—
     Net carrying balance
$78,415$35,000
Unamortized balance of deferred financing cost
12/31/2024$693
NA2
12/31/2023$267
NA2
Available amount at 12/31/2024$35,886$—
1 Amended maturity date is the earlier of (i) the Scheduled Maturity Date and (ii) the Springing Maturity Date (91 days prior to Scheduled Maturity Date of the A&R Term Loan Credit Agreement (defined below), or October 1, 2026).
2 Not applicable
The “applicable margin” in the table above is defined as a rate of 3.15%, 3.40% or 3.65% for Base Rate Loans with a 2.00% base rate floor and a rate of 4.15%, 4.40% or 4.65% for Adjusted Term SOFR Loans with a 1.00% SOFR floor, in each case depending on the amount of EBITDA (as defined in ABL Amendment No.3 to the 2022 ABL Credit Agreement) as of the most recent measurement period as reported in a monthly compliance certificate. Base rate is used when SOFR is not available. The fee for undrawn revolving amounts is 0.50%.
We may make voluntary prepayments of the loans under the 2022 ABL Credit Facility from time to time, subject, in the case of the Delayed Draw Term Loan, to certain conditions. Mandatory prepayments are also required in certain circumstances, including with respect to the Delayed Draw Term Loan, if the ratio of aggregate value of the collateral under the 2022 ABL Credit Facility to the sum of the Delayed Draw Term Loan plus revolving facility usage outstanding is less than 130%. In addition, mandatory prepayments are required for the Delayed Draw Term Loan, equal to 100% of all net cash proceeds attributable to certain European collateral realized in connection with the disposition of the assets.
Amounts repaid under the Revolving Credit Loans may be re-borrowed, subject to compliance with the borrowing base and the other conditions set forth in the 2022 ABL Credit Agreement. Amounts repaid under the Delayed Draw Term Loan cannot be re-borrowed. Certain permanent repayments of the 2022 ABL Credit Facility loans are subject to the payment of a premium ranging from 0% to 2% depending on the date of prepayment as specified in the 2022 ABL Credit Agreement. The 2022 ABL Credit Agreement contains customary conditions to borrowings and covenants, including covenants that restrict our ability to sell assets, make changes to the nature of our business, engage in mergers or acquisitions, incur, assume or permit to exist additional indebtedness and guarantees, create or permit to exist liens, pay dividends, issue equity instruments, make distributions or redeem or repurchase capital stock or make other investments, engage in transactions with affiliates and make payments in respect of certain debt. The 2022 ABL Credit Agreement following the execution of Amendment No.3 also requires that we will not exceed $15.0 million in unfinanced capital expenditures in any CapEx Test Period (as defined therein); provided we shall be permitted to make up to $25.0 million in unfinanced capital expenditures in any CapEx Test Period (as
defined therein) if we maintain a total leverage ratio of less than or equal to 2.00 to 1.00 on a pro forma basis immediately after giving effect to each such unfinanced capital expenditure in excess of the capital expenditure limit. In addition, the 2022 ABL Credit Agreement includes customary events of default, the occurrence of which may require that we pay an additional 2.0% interest on the outstanding loans under the 2022 ABL Credit Facility and that the debt becomes payable immediately. As of December 31, 2024, we are in compliance with the covenants.
Direct and incremental costs associated with the issuance of the 2022 ABL Credit Facility were approximately $8.4 million and were capitalized as deferred financing costs. These costs were fully amortized as of June 16, 2023 due to the Maturity Reserve Trigger Date provision that was previously applicable. We incurred additional financing cost of $0.4 million related to the ABL Amendment No.3 and $0.9 million related to the ABL Amendment No.5. These costs were capitalized and are amortized on a straight-line basis over the amended term of the 2022 ABL Credit Facility.
As of December 31, 2024, we had $77.9 million outstanding under the Revolving Credit Loans and $35.0 million outstanding under the Delayed Draw Term Loans. There were $9.5 million in outstanding letters of credit secured by these instruments, which are off-balance sheet.
ME/RE Loans
The ABL Amendment No.3, in addition to making certain other changes to the 2022 ABL Credit Facility, provided us with $27.4 million of term loans (the “ME/RE Loans”). Our obligations in respect of the ME/RE Loans are guaranteed by the ABL Guarantors. The ME/RE Loans under the 2022 ABL Credit Agreement are secured on a first priority basis by, among other things, certain real estate and machinery and equipment (the “Specified ME/RE Collateral”) and are secured on a lower priority basis by substantially all of the other assets of the ABL Loan Parties. The ME/RE Loans were drawn in full on June 16, 2023 and were used to pay off the remaining amounts owed under the existing APSC Term Loan, discussed below.

On September 30, 2024, the Company entered into ABL Amendment No.5. ABL Amendment No.5 amended the 2022 ABL Credit Agreement to, among other things, provide for the following changes to the ME/RE Loans:

(i) extended the scheduled maturity date from August 11, 2025 to September 30, 2027;

(ii) amended the applicable margin for ME/RE Loans from a flat rate of 5.75% for SOFR Loans (as defined in the 2022
ABL Credit Agreement) to a flat rate of 5.00% for SOFR Loans; and

(iii) amend the applicable prepayment premium for ME/RE Loans from a rate ranging from 0% to 1% to a rate ranging from 0% to 2% based on the date of prepayment.

The terms of ME/RE Loans are described in the table below (dollar amounts are presented in thousands):
Scheduled maturity date1
9/30/2027
Stated interest rate
SOFR + 5.00% + 0.11% credit spread adjustment
Principal payments
$237 monthly
Effective interest rate2
12/31/202412.97%
12/31/202317.40%
Actual cash interest rate
12/31/20249.67%
12/31/202311.21%
Interest paymentsmonthly
Cash paid for interest
12/31/2024$2,737
12/31/2023$1,384
Balances at 12/31/2024
Principal balance$22,981
Unamortized balance of debt issuance cost$(862)
Net carrying balance$22,119
Balances at 12/31/2023
Principal balance$25,823
Unamortized balance of debt issuance cost$(1,762)
Net carrying balance$24,061
Available amount at 12/31/2024$—
_________________
1 Amended maturity date is the earlier of (i) the Scheduled Maturity Date and (ii) the Springing Maturity Date (91 days prior to Scheduled Maturity Date of the A&R Term Loan Credit Agreement, or October 1, 2026).
2 The effective interest rate as of December 31, 2024, consisted of a 9.67% variable interest rate paid in cash and an additional 3.30% due to non-cash amortization of the related debt issuance costs. The effective interest rate as of December 31, 2023, consisted of a 11.21% variable interest rate paid in cash and an additional 6.19% due to amortization of the related debt issuance costs.
We may make voluntary prepayments of the ME/RE Loans from time to time. Mandatory prepayments are required in certain instances when sales of assets are completed that are related to the Specified ME/RE Collateral (as defined in the 2022 ABL Credit Agreement), subject to certain prepayment premiums (subject to certain exceptions), plus accrued and unpaid interest. The remaining unpaid principal balance of the ME/RE loans at maturity will be $18.2 million. The ME/RE Loans are governed by the 2022 ABL Credit Agreement and the same restrictive covenants described above under 2022 ABL Credit Facility apply.
Direct and incremental costs associated with the issuance of the ME/RE Loans in connection with ABL Amendment No. 3 were approximately $2.2 million and were deferred and presented as a direct deduction from the carrying amount of the related debt and are amortized over the term of the ME/RE Loans.

APSC Term Loan
On June 16, 2023, we used the proceeds from the ME/RE Loans and borrowings under the 2022 ABL Credit Facility to repay the total outstanding APSC Term Loan (as defined below) balance of $35.5 million plus the applicable prepayment premium, resulting in a loss on debt extinguishment of $1.6 million and the termination of this facility.
In the previous years, we entered into that certain Term Loan Credit Agreement, dated December 18, 2020, (as amended, the “APSC Term Loan Credit Agreement”) with APSC as agent, pursuant to which we borrowed $250.0 million (the “APSC Term Loan”).
Amended and Restated Term Loan Credit Agreement - Uptiered Loan and Incremental Term Loan
On November 9, 2021, we entered into a credit agreement (as amended by Amendment No.1 dated as of November 30, 2021, Amendment No.2 dated as of December 6, 2021, Amendment No.3 dated as of December 7, 2021, Amendment No.4 dated as of December 8, 2021, Amendment No.5 dated as of February 11, 2022, Amendment No.6 dated as of May 6, 2022, Amendment No.7 dated as of June 28, 2022, Amendment No.8 dated as of October 4, 2022, Amendment No.9 dated as of November 1, 2022, Amendment No.10 dated as of November 4, 2022, Amendment No.11 dated as of November 21, 2022 and Amendment No.12 dated as of March 29, 2023, the “Subordinated Term Loan Credit Agreement”) with Cantor Fitzgerald Securities, as agent, and the lenders party thereto providing for an unsecured approximately $123.1 million delayed draw subordinated term loan facility. Pursuant to the Subordinated Term Loan Credit Agreement, we borrowed $22.5 million on November 9, 2021, and an additional $27.5 million on December 8, 2021. On October 4, 2022, an additional approximately $57.0 million was added to the outstanding principal amount under the Subordinated Term Loan Credit Agreement in exchange for an equivalent amount of the Company’s senior unsecured 5.00% Convertible Senior Notes due 2023 (the “Notes”) held by Corre.
On June 16, 2023, we entered into an amendment and restatement of that certain subordinated term loan credit agreement dated as of November 9, 2021 (such agreement, as amended and restated, and as further amended by Amendment No.1 dated March 6, 2024, and Amendment No. 2 dated September 30, 2024, the “A&R Term Loan Credit Agreement”) among the Company, as borrower, the guarantors party thereto, the lenders from time-to-time party thereto and Cantor Fitzgerald Securities, as agent (the “A&R Term Loan Agent”). Additional funding commitments under the A&R Term Loan Credit Agreement, subject to certain conditions, included a $57.5 million senior secured first lien term loan (the “Incremental Term Loan”) provided by Corre and certain of its affiliates, consisting of a $37.5 million term loan tranche and a $20.0 million delayed draw tranche. Amounts outstanding under the existing subordinated term loan credit agreement (the “Uptiered Loan”) became senior secured obligations of the Company and the A&R Term Loan Guarantors (as defined below) and are secured on a pari passu basis with the Incremental Term Loan, on the terms described below.
On July 31, 2023, $42.5 million, made up of $37.5 million of the term loan tranche and $5.0 million of the delayed draw tranche, of the $57.5 million Incremental Term Loan under the A&R Term Loan Credit Agreement was drawn down and the proceeds thereof were used to repay all of the remaining outstanding Notes that matured on August 1, 2023. We borrowed an additional $5.0 million on October 6, 2023. The remaining availability of the delayed draw tranche of $10.0 million will be used, subject to certain maximum liquidity conditions, for working capital purposes.
On September 30, 2024 we entered into Amendment No.2 (“ Term Loan Amendment No.2”) to the A&R Term Loan Credit Agreement. Term Loan Amendment No.2 amended the A&R Term Loan Credit Agreement to, among other things, make conforming changes to the A&R Term Loan Credit Agreement, consistent with the changes being made to the 2022 ABL Credit Agreement by ABL Amendment No.5.
The Company’s obligations under the A&R Term Loan Credit Agreement are guaranteed by certain direct and indirect material subsidiaries of the Company (the “A&R Term Loan Guarantors” and, together with the Company, the “A&R Term Loan Parties”). The obligations of the A&R Term Loan Parties are secured on a second or lower priority basis by the ABL Priority Collateral and the Specified ME/RE Collateral, and on a first priority basis by substantially all of the other assets of the A&R Term Loan Parties, subject to the terms of an intercreditor agreement (the “Intercreditor Agreement”) between the A&R Term Loan Agent, the ABL Agent and the A&R Term Loan Parties, that sets forth the priorities in respect of the collateral and certain related agreements with respect thereto.
We may make voluntary prepayments of the loans under the A&R Term Loan Credit Agreement from time to time, and we are required in certain instances related to change of control, asset sales, equity issuances, non-permitted debt issuances and with annual excess cash flow (as defined in the A&R Term Loan Credit Agreement), to make mandatory prepayments of the loans under the A&R Term Loan Credit Agreement, subject to certain prepayment premiums as specified in the A&R Term Loan Credit Agreement (subject to certain exceptions), plus accrued and unpaid interest.
The A&R Term Loan Credit Agreement contains certain customary conditions to borrowings, events of default and affirmative, negative, and financial covenants (including a net leverage ratio and maximum annual capital expenditures covenant, all as described in the A&R Term Loan Credit Agreement). As of December 31, 2024, we were in compliance with the covenants.
Further, the A&R Term Loan Credit Agreement includes certain customary events of default, the occurrence of which may require an additional 2.00% interest on the outstanding loans and other obligations under the A&R Term Loan Credit Agreement and the debt may become payable immediately.
The terms of Uptiered Loan / Subordinated Term Loan and Incremental Term Loan are described in the table below (dollar amounts are presented in thousands):
Uptiered Loan
 Incremental Term Loan
Maturity date
12/31/2027 (12/31/2026 if outstanding balance is greater than $50 million)
12/31/2026
Stated interest rate
12/31/2024
 9.5% PIK and 4.0% cash3
12% paid in cash
12/31/2023
 12% PIK
12% paid in cash
Principal paymentsat maturity
$356 quarterly
Effective interest rate
12/31/2024
14.56%1
22.96%2
12/31/2023
12.86%1
22.96%2
Interest paymentscash quarterly/PIK monthly quarterly
Cash paid for interest
12/31/2024$2,775$5,684
12/31/2023$—$898
PIK interest added to principal
12/31/2024$14,366$—
12/31/2023$14,644$8
Balances at 12/31/2024
Principal balance4
$144,454$46,627
Unamortized balance of debt issuance cost$(499)$(6,803)
Net carrying balance$143,955$39,824
Balances at 12/31/2023
Principal balance4
$130,087$48,052
Unamortized balance of debt issuance cost$(651)$(9,294)
Net carrying balance$129,436$38,758
Available amount at 12/31/2024$—$10,000
___________
1 The effective interest rate on the Uptiered Loan as of December 31, 2024, consisted of a 13.50% stated interest rate paid in PIK and cash and an additional 1.06% due to the amortization of the related debt issuance costs. The effective interest rate on the Uptiered Loan as of December 31, 2023 consisted of a 12.00% stated interest rate paid in PIK and an additional 0.86% due to the acceleration of the amortization of the related debt issuance costs.
2 The effective interest rate on the Incremental Term Loan as of December 31, 2024 and 2023, consisted of a 12.00% stated interest rate paid in cash and an additional 10.96% due to the amortization of the related debt issuance costs.
3 Cash and PIK split is determined based on the Net Leverage Ratio as defined in the A&R Term Loan Credit Agreement.
4 The principal balance of the Uptiered Loan is made up of $22.5 million drawn on November 9, 2021, $27.5 million drawn on December 8, 2021, and $57.0 million added as part of the exchange agreement on October 4, 2022. In addition, the principal balance includes PIK interest of $36.6 million and $22.2 million as of December 31, 2024 and December 31, 2023 respectively, and PIK fees of $0.9 million incurred as of December 31, 2022.
The Uptiered Loan under the A&R Term Loan Credit Agreement bears an original interest at an annual rate of 12.00%, a split between cash and PIK, with the cash portion ranging from 2.50% per annum to 12.00% per annum, and the PIK portion ranging from 9.50% per annum to 0.00% per annum, depending on the Company’s Net Leverage Ratio (as defined in the A&R Term Loan Credit Agreement). In addition, if certain conditions related to repayments in respect of the Incremental Term Loan are not met, certain additional quarterly fees (not to exceed 4 such fees) plus a 150 basis point increase to the applicable interest rate will be payable to the lenders under the A&R Term Loan Credit Agreement in cash or common stock of the Company, at the Company’s option. The rate increase became effective at January 31, 2024, and as of December 31, 2024, the interest rate was 13.5% consisting of 4% cash interest and 9.5% PIK interest.
In addition, if certain minimum liquidity thresholds set forth in the A&R Term Loan Credit Agreement are not met for an applicable interest payment date, all interest in respect of the Uptiered Loan payable on such interest payment date will be PIK, irrespective of the Net Leverage Ratio at such time.
Direct and incremental costs associated with the issuance of the Incremental Term Loan in connection with the A&R Term Loan Credit Agreement were approximately $10.1 million and were deferred and presented as a direct deduction from the carrying amount of the related debt and are amortized over the term of the Incremental Term Loan.
Warrants
As of December 31, 2024 and December 31, 2023, APSC Holdco II, L.P. held 500,000 warrants and certain Corre holders collectively held 500,000 warrants, in each case providing for the purchase of one share of the Company’s common stock per warrant at an exercise price of $15.00. The warrants will expire on December 8, 2028. See table below for further details.
Original
After 1 for 10 Reverse Stock Split (Effective date December 22, 2022)
HolderDateNumber of shares Exercise priceExpiration dateNumber of shares Exercise priceExpiration date
APSC Holdco II, LP
Original12/18/20203,582,949$7.75 6/14/2028
Amended11/9/2021500,000$1.50 6/14/2028
Amended12/8/2021917,051$1.50 12/8/2028
Total APSC5,000,000$1.50 12/8/2028500,000$15.00 12/8/2028
Corre12/8/20215,000,000$1.50 12/8/2028500,000$15.00 12/8/2028
Total warrants10,000,0001,000,000
The exercise price and the number of shares of our common stock issuable on exercise of the warrants are subject to certain antidilution adjustments, including for stock dividends, stock splits, reclassifications, noncash distributions, cash dividends, certain equity issuances and business combination transactions.
In connection with the transactions contemplated by the 2022 ABL Credit Agreement, on February 11, 2022 we entered into a common stock subscription agreement with the Corre holders, pursuant to which we issued and sold the common stock to the Corre holders. The Company, the Corre holders and APSC Holdco entered into those certain Team, Inc. Waivers of Anti-Dilution Adjustments and Cash Transaction Exercise (collectively, the “Warrant Waivers”) and agreed, among other things, (i) to irrevocably waive certain anti-dilution adjustments set forth in such Warrant in connection with the Proposed Equity Financing (as defined in the Warrant Waivers); (ii) to not exercise such Warrant, in whole or in part, if the Company determines that such exercise will cause an ownership change within the meaning of Section 382 of the Internal Revenue Code of 1986, as amended (assuming, among other things, that the ownership change threshold is 47% rather than 50%); and (iii) to only exercise such Warrant in a “cashless” or “net-issue” exercise.
Equipment Financing Loan
On March 6, 2024, we entered into agreements to sell various equipment to an equipment finance lender for $2.9 million and lease the equipment for monthly payments of $181 thousand over eighteen months. The lease agreement provides for a bargain purchase option at the end of the lease term which we intend to exercise. The Company determined that the transaction did not meet the criteria for sale-leaseback in accordance with ASC 842, Leases and accounted for this arrangement as an equipment financing. The assets subject to the transaction remain on our balance sheet and continue to depreciate in accordance with our depreciation policy.
1970 Group Substitute Insurance Reimbursement Facility
On September 16, 2024, we entered into an amended and restated substitute insurance reimbursement facility agreement with 1970 Group Inc. (“1970 Group”) (such agreement, the “Substitute Insurance Reimbursement Facility Agreement”). Under the Substitute Insurance Reimbursement Facility Agreement, the 1970 Group extended credit to us in the form of a substitute reimbursement facility (the “Substitute Reimbursement Facility”) to provide up to approximately $19.0 million of letters of credit on our behalf in support of our workers’ compensation, commercial automotive and general liability insurance policies. As of December 31, 2024, we have $19.0 million of letters of credit outstanding under the Substitute Reimbursement Facility.
Such letters of credit arranged by the 1970 Group permitted the return of certain existing letters of credit for our account that were outstanding for the purpose of supporting the Insurance Policies and that were required to be collateralized, thereby providing us increased liquidity. Under the Substitute Insurance Reimbursement Facility Agreement, we are required to
reimburse the 1970 Group for any draws made under the letters of credit within three business days of notice of any such draw. The Substitute Insurance Reimbursement Facility Agreement is effective through the term of the issued letters of credit; it renews annually upon payment of the extension fee, provided there has not been an event of default.
According to the provisions of ASC 470, Debt, the arrangement is a “Substitute Insurance Reimbursement Facility” limited to the amounts drawn under the letters of credit. Therefore, until we use or draw on the Substitute Insurance Reimbursement Facility, the letters of credit are treated as an off-balance sheet credit arrangement. Fees in the amount of $2.3 million and $2.9 million, respectively, were paid by us during the years ended December 31, 2024 and 2023 and were deferred and amortized over the term of the arrangement. As of December 31, 2024 and 2023, the unamortized balance of $1.6 million and $1.8 million was included in other current assets.
Liquidity
As of December 31, 2024, we had $31.5 million of unrestricted cash and cash equivalents and $4.0 million of restricted cash, including $2.8 million of restricted cash held as collateral for letters of credit and commercial card programs. International cash balances included in total cash as of December 31, 2024 were $5.1 million, and approximately $1.1 million of such cash is restricted. As of December 31, 2024, we had approximately $45.9 million of availability under our various credit facilities, consisting of $35.9 million available under the Revolving Credit Loans and $10.0 million available under the Incremental Delayed Draw Term Loan under the A&R Term Loan Credit Agreement. We had $30.6 million in letters of credit and $1.5 million in surety bonds outstanding.
Our cash and cash equivalents as of December 31, 2023 totaled $30.4 million of unrestricted cash and cash equivalents and $5.0 million of restricted cash, including $3.4 million of restricted cash held as collateral for letters of credit and commercial card programs. Additionally, $12.0 million of the $30.4 million of cash and cash equivalents was in foreign accounts, primarily in Canada, the U.K. and Europe including $0.6 million of cash located in countries where currency or regulatory restrictions existed.