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What changed in TEAM INC's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of TEAM INC's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+153 added−152 removedSource: 10-K (2026-03-12) vs 10-K (2025-03-19)

Top changes in TEAM INC's 2025 10-K

153 paragraphs added · 152 removed · 103 edited across 8 sections

Item 1. Business

Business — how the company describes what it does

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Biggest changeWe have several online training and distance learning classes as part of our curriculum to help meet the needs of a rapidly changing workplace environment. These are administered and tracked globally though our Learning Management System.
Biggest changeThe intent of the Shop Life Saving Rules is to define the specific high hazard tasks associated with shop type activities including rotating equipment hazards, fork truck hazards, housekeeping, guarding and other shop specific rules. We have several online training and distance learning classes as part of our curriculum to help meet the needs of a rapidly changing workplace environment.
Additionally, we provide employees with a comprehensive set of benefits, including health and welfare benefits, wellness benefits, employee assistance plans, defined contribution and defined benefit retirement benefits (United Kingdom employees only), paid time off, educational support and a variety of other ancillary employee benefits.
Additionally, we provide employees with a comprehensive set of benefits, including health and welfare benefits, wellness benefits, employee assistance plans, defined contribution and defined benefit retirement plans (United Kingdom employees only), paid time off, educational support and a variety of other ancillary employee benefits.
We are proud that a diverse group of people from a variety of backgrounds, religions, nationalities, gender identity, sexual orientations and races make up our team. It continues to be our goal to create an inclusive environment and eliminate bias wherever it exists through strategic employee-engaged initiatives.
We are proud that a group of people from a variety of backgrounds, religions, nationalities, gender identity, sexual orientations and races make up our team. It continues to be our goal to create an inclusive environment and eliminate bias wherever it exists through strategic employee-engaged initiatives.
On June 16, 2023, in connection with, and effective upon, the consummation of the transactions contemplated by the A&R Term Loan Credit Agreement and ABL Amendment No. 3 (as defined below), we, Corre and the other parties thereto, entered into a new Board Rights Agreement (the “Corre Board Rights Agreement”), pursuant to which Corre, acting on behalf of itself and its affiliates (together with Corre, the “Corre Investors”) that beneficially own our common stock (inclusive of the Corre Warrants), may, subject to common stock ownership thresholds and/or indebtedness and commitment thresholds and other terms provided in the Corre Board Rights Agreement, designate an individual to serve as a non-voting observer at all meetings of the Board, nominate one individual to serve as Chairman of the Board (the “Chairperson”), and nominate two additional individuals to serve on the Board (such individuals, together with the Chairperson, the “Corre Investor Directors”).
On June 16, 2023, in connection with, and effective upon, the consummation of the transactions contemplated by the A&R Term Loan Credit Agreement and ABL Amendment No.3 (as defined below), we, Corre and the other parties thereto, entered into a new Board Rights Agreement (the “Corre Board Rights Agreement”), pursuant to which Corre, acting on behalf of itself and its affiliates (together with Corre, the “Corre Investors”) that beneficially own our common stock (inclusive of the Corre Warrants), may, subject to common stock ownership thresholds 6 Table of Content and/or indebtedness and commitment thresholds and other terms provided in the Corre Board Rights Agreement, designate an individual to serve as a non-voting observer at all meetings of the Board, nominate one individual to serve as Chairman of the Board (the “Chairperson”), and nominate two additional individuals to serve on the Board (such individuals, together with the Chairperson, the “Corre Investor Directors”).
No single customer accounted for 10% or more of consolidated revenues during the years ended December 31, 2024 and 2023, respectively. Generally, customers are billed on a time and materials basis, although some work may be performed pursuant to a fixed-price bid. Services are usually performed pursuant to purchase orders issued under written customer agreements.
No single customer accounted for 10% or more of consolidated revenues during the years ended December 31, 2025 and 2024, respectively. Generally, customers are billed on a time and materials basis, although some work may be performed pursuant to a fixed-price bid. Services are usually performed pursuant to purchase orders issued under written customer agreements.
Also, many states where we operate regulate health, safety and environmental activities, such as California OSHA and the Texas Commission on Environmental Quality. Expenditures relating to such regulations are made in the normal course of our business and are neither material nor place us at any competitive disadvantage.
Also, many states where we operate regulate health, safety and environmental activities, such as California Environmental Protection Agency, California OSHA and the Texas Commission on Environmental Quality. Expenditures relating to such regulations are made in the normal course of our business and are neither material nor place us at any competitive disadvantage.
The Corporate Governance and Nominating Committee receives regular updates from our ESG Council regarding the considerations and actions taken by us with respect to ESG. APSC Board Rights On November 1, 2022, we entered into the Board Rights Agreement (the “APSC Board Rights Agreement”) with Atlantic Park Strategic Capital Fund, L.P.
At the Board level, the Corporate Governance and Nominating Committee receives regular updates from our ESG Council regarding the considerations and actions taken by us with respect to ESG. Board Rights APSC Board Rights On November 1, 2022, we entered into the Board Rights Agreement (the “APSC Board Rights Agreement”) with Atlantic Park Strategic Capital Fund, L.P.
While many contracts cover specific plants or locations, we also enter into multiple-site regional or national contracts which cover multiple plants or locations. In general, competition stems from a large number of other outside service contractors. More than 100 different competitors are currently active in our markets.
While many contracts 3 Table of Content cover specific plants or locations, we also enter into multiple-site regional or national contracts which cover multiple plants or locations. In general, competition stems from a large number of other outside service contractors. More than 100 different competitors are currently active in our markets.
Environmental, social and governance General ESG approach We strive to promote and support business practices that are environmentally sustainable, socially conscious, and aligned with strong corporate governance practices. We are committed to conducting our business in a manner that protects the environment and the health and safety of our employees, our customers, our suppliers and contractors and the general public.
Environmental, Social and Governance (“ESG”) We strive to promote and support business practices that are environmentally sustainable, socially conscious, and aligned with strong corporate governance practices. We are committed to conducting our business in a manner that protects the environment and the health and safety of our employees, our customers, our suppliers and contractors and the general public.
The capacity and capability scope of our discrete and integrated services also allows us to benefit from the procurement trends of many of our customers who are seeking to reduce the number of contractors and vendors 3 Table of Content in their facilities, as well as to outsource more of such services.
The capacity and capability scope of our discrete and integrated services also allows us to benefit from the procurement trends of many of our customers who are seeking to reduce the number of contractors and vendors in their facilities, as well as to outsource more of such services.
Many of our services, including our inspection, emissions monitoring and leak repair services, are crucial in assisting our customers to identify, assess and reduce their carbon and greenhouse gas emissions. We provide inspection, condition assessment, maintenance and repair services and support our customers’ diversification efforts into sources of renewable energy.
Many of our services, including our inspection, emissions monitoring and leak repair services, are crucial in assisting our customers to identify, assess and reduce their carbon and other emissions. We provide inspection, condition assessment, maintenance and repair services and support our customers’ diversification efforts into sources of renewable energy.
Our talent management programs are designed to empower and inspire our team members to personalize their career journeys by building critical job skills, gaining hands-on experience, providing ongoing access to world class training, assigning relevant career mentors and paving the way toward career paths that provide long-term advancement within our organization.
Our talent management programs are designed to empower and inspire our team members to personalize their career journeys by building 5 Table of Content critical job skills, gaining hands-on experience, providing ongoing access to world class training, assigning relevant career mentors and paving the way toward career paths that provide long-term advancement within our organization.
All Team employees complete online training covering all of the LSRs and expectations and must acknowledge that they have read them. The rules are posted internally, communicated throughout our organization through safety bulletins, and are printed in multiple languages. In 2022 Team established our Hand Safety Rules.
All Team employees complete online training covering all of the LSRs and expectations and must acknowledge that they have read them. The rules are posted internally, communicated throughout our organization through safety bulletins, and are printed in multiple languages.
We are an Equal Employment Opportunity employer and it is our policy to provide equal employment opportunities to all qualified persons. We seek to attract and retain a diverse workforce, in particular for our technician population, which comprises more than 77% of our overall global workforce.
We are an Equal Employment Opportunity employer and it is our policy to provide equal employment opportunities to all qualified persons. We seek to attract and retain a workforce diverse in experience, skills and backgrounds, in particular for our technician population, which comprises more than 79% of our overall global workforce.
Human Capital 4 Table of Content Due to the seasonal nature of our business, our employee headcount varies during the year. During 2024, we averaged approximately 5,400 employees, with approximately 4,100 employed in the United States and 1,300 internationally. Human capital management, combined with our core values and talent management initiatives, is a key driver of our employee retention program.
Human Capital Due to the seasonal nature of our business, our employee headcount varies during the year. During 2025, we averaged approximately 5,300 employees, with approximately 4,000 employed in the United States and 1,300 internationally. Human capital management, combined with our core values and talent management initiatives, is a key driver of our employee retention program.
Core IHT services are as follows: • Non-Destructive Evaluation and Testing Services. • Radiographic Testing. • Ultrasonic Testing. • Magnetic Particle Inspection. • Liquid Penetrant Inspection. • Positive Material Identification. • Electromagnetic Testing. • Alternating Current Field Measurement. • Eddy Current Testing. • Long-Range Guided Ultrasonics. • Phased Array Ultrasonic Testing. • Terminals and Storage Inspection and Management Programs. • Rope Access. • Mechanical Integrity Services. • Pipeline Integrity Services. • Heat Treating Services.
Core IHT services are as follows: • Non-Destructive Evaluation and Testing Services. • Radiographic Testing. 2 Table of Content • Ultrasonic Testing. • Magnetic Particle Inspection. • Liquid Penetrant Inspection. • Positive Material Identification. • Electromagnetic Testing. • Alternating Current Field Measurement. • Eddy Current Testing. • Long-Range Guided Ultrasonics. • Phased Array Ultrasonic Testing. • Terminals and Storage Inspection and Management Programs. • Rope Access. • Mechanical Integrity Services. • Pipeline Integrity Services. • Heat-Treating Services. • Laboratory Services, including Metallurgical and Tensile Services.
Our General Counsel & Secretary, who reports directly to our CEO, has general oversight responsibility with respect to matters of sustainability and social responsibility and is the executive sponsor of our ESG Council.
Our Chief Legal Officer, who reports directly to our CEO, has general oversight responsibility with respect to matters of sustainability and social responsibility and is the executive sponsor of our ESG Council.
Diversity and inclusion We believe that a diverse, inclusive and engaged workforce is critical to our success, and we work hard to create an environment where our employees feel valued, engaged and inspired to do their best work.
Equal employment opportunity We believe that an inclusive and engaged workforce is critical to our success, and we work hard to create an environment where our employees feel valued, engaged and inspired to do their best work.
We market our services to companies in a diverse array of heavy industries which include: • Energy (refining, power, renewables, nuclear, offshore oil and gas, and liquefied natural gas); • Manufacturing and Process (chemical, petrochemical, pulp and paper industries, automotive and mining); • Midstream (valves, terminals and storage, and pipeline); • Infrastructure (construction and building, roads, dams, amusement parks, bridges, ports, and railways); and • Aerospace and Defense. 2 Table of Content Description of Business Inspection and Heat Treating Segment: IHT offers standard to specialty inspection services as well as heat treating services and digital imaging services.
We market our services to companies in a diverse array of heavy industries which include: • Energy (refining, power, renewables, nuclear, offshore oil and gas, and liquefied natural gas); • Manufacturing and Process (chemical, petrochemical, pulp and paper industries, automotive and mining); • Midstream (valves, terminals and storage, and pipeline); • Infrastructure (construction and building, roads, dams, amusement parks, bridges, ports, and railways); and • Aerospace and Defense.
We seek to recruit the most qualified candidates, including by recruiting from a broad range of places. Health, safety and training We have “12 Life Saving Rules” across our organization to further enhance our safety focused culture.
Corporate Leadership General & Administrative Global Workforce 1 Female 14% 56% 11% Male 86% 44% 89% _________________ 1 Global workforce includes technicians. We seek to recruit the most qualified candidates, including by recruiting from a broad range of places. Health, safety and training We have “12 Life Saving Rules” across our organization to further enhance our safety focused culture.
Business ethics and core values Our core values anchor every aspect of our business in a set of commonly held beliefs and commitments. They represent what we stand for, the values our employees embody, what our customers can expect in the delivery of our services and what our services and products contribute to the market.
They represent what we stand for, the values our employees embody, what our customers can expect in the delivery of our services and what our services and products contribute to the market.
We invest in our talent by providing our employees with targeted training, mentoring and career development opportunities, all of which enable us to hire and retain skilled, high-performing employees. We work to prioritize our safety-first culture and our diversity and inclusion initiatives, and we seek to retain employees through our employee engagement efforts and our competitive compensation and benefits packages.
We invest in our talent by providing our employees with targeted training, mentoring and career development opportunities, all of which enable us to hire and retain skilled, high-performing employees.
Additionally in 2024, we continued our focus on regular communications with our employees, which included global town hall meetings and the monthly CEO Connection newsletters. Wages and benefits Across the globe, we strive to provide our employees with competitive wages, salaries and benefits based upon employee skills, experience and job levels.
Wages and benefits Across the globe, we strive to provide our employees with competitive wages, salaries and benefits based upon employee skills, experience and job levels.
Heat treating services are generally associated with turnaround, project and new construction activities.
Description of Business Inspection and Heat-Treating Segment: IHT offers standard to specialty inspection services as well as heat-treating services and digital imaging services. Heat- treating services are generally associated with turnaround, project and new construction activities.
We work closely with our customers across the world to assist them in meeting their environmental sustainability goals. We sponsor and support numerous charitable organizations and encourage our employees to donate their time and financial support to serving the needs of their communities.
We work closely with our customers across the world to assist them in meeting their environmental sustainability goals. Our Company management is responsible for the day-to-day operation of ESG matters.
In addition, Team Stress and Anxiety Management Program (“STAMP”) provides several tools and resources to help employees effectively manage stress and prevent depression and other mental illnesses. STAMP provides informative live sessions 5 Table of Content covering various mental health topics such as mindfulness, post-traumatic stress disorder (PTSD) and resiliency.
These are administered and tracked globally though our Learning Management System. In addition, Team Stress and Anxiety Management Program (“STAMP”) provides several tools and resources to help employees effectively manage stress and prevent depression and other mental illnesses.
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Corporate Leadership General & Administrative Global Workforce 1 Female 13% 56% 11% Male 87% 44% 89% _________________ 1 Global workforce includes technicians. As part of our university recruiting efforts, we have developed diversity focused strategies through collaboration with the career centers at the universities where we recruit.
Added
We work to prioritize our safety-first culture and equal employment opportunity initiatives, and we seek to retain employees through our employee engagement efforts and our competitive compensation and benefits packages. 4 Table of Content Business ethics and core values Our core values anchor every aspect of our business in a set of commonly held beliefs and commitments.
Removed
The intent of the Hand Safety Rules is to define the specific high hazard tasks where the potential for hand injuries is most common. The Hand Safety Rules focus on types of hand hazards, hand placement, equipment guarding, and when to stop the job and reassess potential hazards.
Added
In 2025 Team established our Shop Life Saving Rules to further differentiate between rules that are more field focused versus those that are more shop focused.
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We coordinate this program with our Employee Assistance Program that offers mental health and depression benefits for our employees and their families. STAMP has received much praise and support from our employees, their families and our customers. We recognize the importance of providing training to continually support career growth and development.
Added
Team also publishes the Health, Safety, Environmental and Quality (“HSEQ”) Gazette on a bi-monthly basis to provide the organization with a wide variety of HSEQ topics and information.
Removed
We have incorporated more flexibility in our work environment by offering eligible employees the ability to work remotely or on-site, and by offering flexible working schedules. We expect to continue offering such flexibility to eligible employees moving forward.
Added
The Gazette covers relevant safety topics, HSEQ key performance indicators, employee recognitions, lessons learned from incidents, helpful environmental and vehicle safety information, Team STAMP highlights, best practices, and details on any upcoming initiatives. We recognize the importance of providing training to continually support career growth and development.
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We believe the significant response rates to our surveys are indicative of the intensity of our employee’s connection to our organization, marked by a committed effort to achieve goals in environments that support productivity and maintain personal well-being. In 2023, we celebrated Team’s 50th anniversary.
Added
In 2025, TEAM launched a new and improved global employee recognition program with the Achievers platform, designed to recognize outstanding performance and milestones in an employee’s tenure with Team. Additionally in 2025, we continued our focus on regular communications with our employees, which included CEO Connection newsletters.
Removed
We held employee celebrations across the globe, commemorated the milestone with a signature gift for all employees and presented a 50th anniversary video showcasing our employees and highlighting some of Team’s most significant accomplishments over the years.
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Stellex Board Rights On September 11, 2025, we, InspectionTech Holdings LP (the “Stellex Holder”) and Stellex Capital Management LLC (collectively with the Stellex Holder and its affiliates, “Stellex”) entered into that certain Shareholders Agreement (the “Stellex Shareholders Agreement”).
Removed
We provide training to support career growth opportunities for our diverse team of employees and actively contribute to the local communities in which we operate.
Added
Pursuant to and subject to the terms and conditions of the Stellex Shareholders Agreement, the Board was required to appoint two qualified nominees of Stellex and its affiliates (collectively, the “Stellex Investors”) to the Board, who were each designated by the Stellex Investors and qualified as an independent director (each, a “Stellex Board Nominee”).
Removed
We strive to be an industry leader in the fields of health, safety and environmental management and work with government organizations and industry organizations in support of laws, regulations, standards and other programs that safeguard the workplace and our environment.
Added
Pursuant to and subject to the terms and conditions of the Stellex Shareholders Agreement, the Company is required to nominate each initial Stellex Board Nominee, or each successor Stellex Board Nominee chosen by the Stellex Investors, for re-election at each election of the class of directors in which such Stellex Board Nominee is placed.
Removed
These contributions help to support the work of nonprofit organizations of all sizes, working in areas such as disability services and support, disaster response, and hunger prevention around the globe. Our Company management is responsible for the day-to-day operation of ESG matters.
Added
Upon the Stellex Investors ceasing to beneficially own (as defined in Rule 13d-3 under the Exchange Act) (i) more than 50% of the aggregate Stellex Warrants (as defined herein) and common stock issued upon exercise of such Stellex Warrants, the number of Stellex Board Nominees that the Stellex Investors are entitled to shall be reduced by one, and (ii) any of the Series B Preferred Stock (as defined herein), the number of Stellex Board Nominees that the Stellex Investors are entitled to shall be reduced by one.
Removed
Under its charter, the ESG Council, which is a management committee formed to assist our General Counsel & Secretary in oversight responsibilities, is responsible for recommending our ESG objectives, monitoring the implementation and performance of our ESG objectives, overseeing the progress made against our social and environmental goals and reporting on our ESG performance.
Added
In the event of the resignation, death or removal (for cause or otherwise) of the Stellex Board Nominees from the Board, the Stellex Investors will have the right, but not the obligation, to designate a successor Stellex Board Nominee, as applicable, to the Board to fill the resulting vacancy on the Board (and any applicable committee thereof), subject to certain qualification requirements specified in the Stellex Shareholders Agreement.
Removed
At the Board level, our Corporate Governance and Nominating Committee has responsibility for maintaining oversight over Team’s corporate governance principles and corporate social responsibility and sustainability matters, including our public reporting on corporate 6 Table of Content social responsibility and sustainability.

Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeFurther, the OECD issued administrative guidance providing transition and safe harbor rules that could delay the impact of the minimum tax directive. We will continue to monitor the implementation of these rules by the countries in which we operate.
Biggest changeThe 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.
We have a significant amount of debt as discussed below, and our overall leverage and the terms of our financing arrangements could: • limit our ability to obtain additional financing in the future for working capital, capital expenditures, to fund growth or for general corporate purposes; • make it more difficult for us to satisfy the terms of our debt obligations; • make it more difficult for us to manage increases in interest rates; • 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; and • create a competitive disadvantage by reducing our flexibility in responding to increased competition from competitors who hold a lower level on indebtedness.
We have a significant amount of debt as discussed below, and our overall leverage and the terms of our financing arrangements could: • limit our ability to obtain additional financing in the future for working capital, capital expenditures, to fund growth or for general corporate purposes; • make it more difficult for us to satisfy the terms of our debt obligations; • make it more difficult for us to manage increases in interest rates; • 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, thereby limiting the availability of our cash flow to fund future investments, capital expenditures, working capital, business activities and other general corporate requirements; and • create a competitive disadvantage by reducing our flexibility in responding to increased competition from competitors who hold a lower level on indebtedness.
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.
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.
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.
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.
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.
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.
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.
A decrease in our market capitalization or profitability or unfavorable changes in market, economic and industry conditions would increase the risk of impairment. GAAP requires that we evaluate the useful lives of our intangible assets subject to amortization each reporting period.
A decrease in our market capitalization or profitability or unfavorable changes in market, economic and industry conditions would increase the risk of impairment. U.S. GAAP requires that we evaluate the useful lives of our intangible assets subject to amortization each reporting period.
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.
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 via a global minimum tax initiative.
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.
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.
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 .
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 increasing scrutiny relating to their ESG policies, initiatives and activities by investors, lenders, regulators, customers and other market participants.
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.
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.
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.
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.
While it is uncertain whether the U.S. 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.
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 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.
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.
Risks Related to Financing Our Business 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.
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.
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.
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).
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.
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.
We maintain a $6.0 million retention for indemnity coverage. 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.
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.
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.
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.
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.
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 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.
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.
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.
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.
Our future effective tax rates could also be adversely affected by changes in tax laws, both domestically and internationally, or the interpretation of application thereof. From time to time, the U.S. Congress and foreign, state and local governments consider legislation that could increase our effective tax rate.
We will continue to monitor the implementation of these rules by the countries in which we operate. Our future effective tax rates could also be adversely affected by changes in tax laws, both domestically and internationally, or the interpretation of application thereof. From time to time, the U.S.
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.
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. Our business may be adversely impacted by work stoppages, staffing shortages and other labor matters.
We cannot determine whether, or in what form, other future tax legislation will ultimately be enacted or what impact any such legislation could have on our profitability. We are also currently subject to audit in various jurisdictions, and these jurisdictions may assess additional income or other tax liabilities against us.
We are also currently subject to audit in various jurisdictions, and these jurisdictions may assess additional income or other tax liabilities against us.
Our revenues are heavily dependent on certain industries. Sales of our services are dependent on customers in certain industries, particularly the refining and petrochemical industries.
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. Sales of our services are dependent on customers in certain industries, particularly the refining and petrochemical industries.
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.
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.
Removed
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.
Added
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.
Removed
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.
Added
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.
Removed
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.
Added
Historically, our quarterly and annual sales and operating results have fluctuated. We expect fluctuations to continue in the future.
Removed
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.
Added
Congress and foreign, state and local governments consider legislation that could increase our effective tax rate. We cannot determine whether, or in what form, other future tax legislation will ultimately be enacted or what impact any such legislation could have on our profitability.
Added
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.

Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThis plan requires the IT Security Manager to determine whether a cybersecurity incident has occurred and to communicate such findings to the Incident Response Team. The IT Security Manager is responsible for communicating incidents to the Vice President - IT and the other members of management as appropriate.
Biggest changeThis plan requires the IT Security Director to determine whether a cybersecurity incident has occurred and to communicate such findings to the Incident Response Team. The IT Security Director is responsible for communicating incidents to the Vice President - IT and the other members of management as appropriate.
If a cybersecurity incident is determined to be material by our management team, they would notify the Board. Our Vice President - IT and IT Security manager have developed expertise in cybersecurity, data protection, compliance, enterprise architecture and design, data analytics, and digital transformation through years of experience in the information technology space.
If a cybersecurity incident is determined to be material by our management team, they would notify the Board. Our Vice President - IT and IT Security Director have developed expertise in cybersecurity, data protection, compliance, enterprise architecture and design, data analytics, and digital transformation through years of experience in the information technology space.
Our Vice President - IT is designated as the senior executive responsible for cybersecurity and reports directly to our CFO. She and the IT Security manager have comprehensive information technology background with over 30 years of information technology experience. These individuals are responsible for the day-to-day implementation of our cybersecurity program.
Our Vice President - IT is designated as the senior executive responsible for cybersecurity and reports directly to our CFO. She and the IT Security Director have comprehensive information technology background with over 30 years of information technology experience. These individuals are responsible for the day-to-day implementation of our cybersecurity program.
The Audit Committee is responsible for the oversight of risks from cybersecurity threats. Our Vice President - IT and the IT security team update the Audit Committee on our cyber risk management program during each of its quarterly meetings.
The Audit Committee is responsible for the oversight of risks from cybersecurity threats. Our Vice President - IT and the IT security Director update the Audit Committee on our cyber risk management program during each of its quarterly meetings.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. PROPERTIES We provide our services globally through more than 138 locations in 13 countries. There are several materially important physical properties used in our operations. We own a facility in Alvin, Texas that consists of our primary training facility, equipment center and International Organization for Standardization-9001 certified manufacturing facility for clamps, enclosures, and sealants.
Biggest changeITEM 2. PROPERTIES We provide our services globally through 139 locations in 13 countries. There are several materially important physical properties used in our operations. We own a facility in Alvin, Texas that consists of our primary training facility, equipment center and International Organization for Standardization-9001 certified manufacturing facility for clamps, enclosures, and sealants.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. LEGAL PROCEEDINGS Information regarding our legal proceedings can be found in Note 16 - Commitments and Contingencies to the consolidated financial statements included in Item 8 of this Annual Report on Form 10-K and is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 10 Table of Content PART II
Biggest changeITEM 3. LEGAL PROCEEDINGS Information regarding our legal proceedings can be found in Note 17 - Commitments and Contingencies to the consolidated financial statements included in Item 8 of this Annual Report on Form 10-K and is incorporated herein by reference. ITEM 4. MINE SAFETY DISCLOSURES Not applicable. 10 Table of Content PART II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeFINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 23 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 69 ITEM 9A. CONTROLS AND PROCEDURES 70 Management’s Annual Report on Internal Control Over Financial Reporting 70 ITEM 9B. OTHER INFORMATION 70 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 70 PART III 71
Biggest changeFINANCIAL STATEMENTS AND SUPPLEMENTARY DATA 23 ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE 68 ITEM 9A. CONTROLS AND PROCEDURES 69 Management’s Annual Report on Internal Control Over Financial Reporting 69 ITEM 9B. OTHER INFORMATION 69 ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS 69 PART III 70

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDividends No cash dividends were declared or paid during the years ended December 31, 2024 or 2023. We are limited in our ability to pay cash dividends without the consent of our lenders. Accordingly, we have no present intention of paying cash dividends in the foreseeable future.
Biggest changeDividends No cash dividends were declared or paid during the years ended December 31, 2025 or 2024. We are limited in our ability to pay cash dividends without the consent of our lenders and preferred shareholders. Accordingly, we have no present intention of paying cash dividends in the foreseeable future.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our stock is traded on the NYSE under the symbol “TISI”. Holders There were 313 holders of record of our common stock as of March 17, 2025, excluding beneficial owners of stock held in street name.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our stock is traded on the NYSE under the symbol “TISI”. Holders There were 302 holders of record of our common stock as of March 10, 2026, excluding beneficial owners of stock held in street name.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

39 edited+35 added−34 removed26 unchanged
Biggest changeAND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited, in thousands except per share data) Twelve Months Ended December 31, 2024 2023 Adjusted Net Loss: Net loss $ (38,266) $ (75,722) Professional fees and other 1 4,111 9,121 Legal costs and other 2 124 5,635 Severance charges, net 3 1,323 1,564 Loss on debt extinguishment 4 — 1,585 Write-off of other assets 5 — 1,295 Tax impact of adjustments and other net tax items 6 (210) (159) Adjusted Net Loss $ (32,918) $ (56,681) Adjusted Net Loss per common share: Basic and Diluted $ (7.43) $ (12.97) Consolidated Adjusted EBIT and Adjusted EBITDA: Net loss $ (38,266) $ (75,722) Provision for income taxes 3,276 4,578 Interest expense, net 47,808 55,181 Foreign currency loss (gain) (2,231) 734 Gain on sale of assets (5) (291) Professional fees and other 1 4,111 9,121 Legal costs and other 2 124 5,635 Severance charges, net 3 1,323 1,564 Loss on debt extinguishment 4 — 1,585 Write-off of other assets 5 — 1,295 Pension credit 7 (446) (640) Consolidated Adjusted EBIT 15,694 3,040 Depreciation and amortization Amount included in operating expenses 13,730 14,555 Amount included in SG&A expenses 22,565 23,317 Total depreciation and amortization 36,295 37,872 Non-cash share-based compensation costs 2,273 1,590 Consolidated Adjusted EBITDA $ 54,262 $ 42,502 Free Cash Flow: Cash provided by (used in) operating activities $ 22,767 $ (10,986) Capital expenditures (9,465) (10,430) Free Cash Flow $ 13,302 $ (21,416) ____________________________________ 1 The twelve months ended December 31, 2024, includes $3.8 million related to costs associated with debt financing, and $0.3 million for lease extinguishment charges, support and other costs.
Biggest changeAND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (unaudited, in thousands except per share data) Twelve Months Ended December 31, 2025 2024 Adjusted Net Loss: Net loss $ (49,210) $ (38,266) Professional fees and other 1 8,186 4,111 Legal costs and litigation reserves 2,120 124 Severance charges, net 1,470 1,323 Loss on debt extinguishment 13,136 — Write-off of software cost 45 — Tax impact of adjustments and other net tax items (200) (210) Adjusted Net Loss $ (24,453) $ (32,918) Dividend and accretion to redemption value on redeemable preferred stock (3,451) — Adjusted Net Loss attributable to common shareholders $ (27,904) $ (32,918) Adjusted Net Loss attributable to common shareholders per common share: Basic and Diluted $ (6.20) $ (7.43) Consolidated Adjusted EBIT and Adjusted EBITDA: Net loss $ (49,210) $ (38,266) Provision for income taxes 2,580 3,276 Interest expense, net 44,676 47,808 Foreign currency loss (gain) 3,274 (2,231) Gain on sale of assets (216) (5) Professional fees and other 1 8,186 4,111 Legal costs and litigation reserves 2,120 124 Severance charges, net 1,470 1,323 Loss on debt extinguishment 13,136 — Write-off of software cost 45 — Pension credit 2 (213) (446) Consolidated Adjusted EBIT 25,848 15,694 Depreciation and amortization: Amount included in operating expenses 12,495 13,730 Amount included in SG&A expenses 21,587 22,565 Total depreciation and amortization 34,082 36,295 Non-cash share-based compensation costs 795 2,273 Consolidated Adjusted EBITDA $ 60,725 $ 54,262 Free Cash Flow: Cash provided by (used in) operating activities $ (11,348) $ 22,767 Capital expenditures (9,289) (9,465) Free Cash Flow $ (20,637) $ 13,302 ____________________________________ 1 The twelve months ended December 31, 2025 include $1.7 million related to debt financing and $6.5 million related to support costs.
Non-GAAP measures have important limitations as analytical tools because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures and should be read only in conjunction with financial information presented on a GAAP basis.
Non-GAAP measures have important limitations as analytical tools because they exclude some, but not all, items that affect net earnings and operating income. These measures should not be considered substitutes for their most directly comparable U.S. GAAP financial measures and should be read only in conjunction with financial information presented on a U.S. GAAP basis.
Off-Balance Sheet Arrangements From time-to-time, we enter into off-balance sheet arrangements and transactions that can give rise to material off-balance sheet obligations. See Note 11 - Debt for additional details on our off-balance sheet arrangements. 21 Table of Content Critical Accounting Policies The process of preparing financial statements in accordance with GAAP requires us to make estimates and judgments.
Off-Balance Sheet Arrangements From time-to-time, we enter into off-balance sheet arrangements and transactions that can give rise to material off-balance sheet obligations. See Note 11 - Debt for additional details on our off-balance sheet arrangements. 21 Table of Content Critical Accounting Policies The process of preparing financial statements in accordance with U.S. GAAP requires us to make estimates and judgments.
Segment adjusted EBIT is equal to segment operating income (loss) excluding costs associated with non-routine legal costs and settlements, non-routine professional fees, certain severance charges, and certain other items as determined by management. Segment adjusted EBITDA further excludes depreciation, amortization, and non-cash share-based compensation 15 Table of Content costs from segment adjusted EBIT.
Segment adjusted EBIT is equal to segment operating income (loss) excluding costs associated with non-routine 16 Table of Content legal costs and settlements, non-routine professional fees, certain severance charges, and certain other items as determined by management. Segment adjusted EBITDA further excludes depreciation, amortization, and non-cash share-based compensation costs from segment adjusted EBIT.
We define adjusted net income (loss) and adjusted net income (loss) per share to exclude the following items: non-routine legal costs and settlements, non-routine professional fees, (gain) loss on debt extinguishment, certain severance charges, non-routine write off of assets and certain other items that we believe are not indicative of core operating activities.
GAAP basis. We define adjusted net income (loss) and adjusted net income (loss) per share to exclude the following items: non-routine legal costs and settlements, non-routine professional fees, (gain) loss on debt extinguishment, certain severance charges, non-routine write-off of assets and certain other items that we believe are not indicative of core operating activities.
For the year ended December 31, 2024, net cash used in financing activities was $12.7 million, consisting primarily of $8.5 million of debt issuance costs, $2.8 million of principal payments under the ME/RE Loans and $1.4 million of principal payments under the Incremental Term Loan, partially offset by the net borrowings on our 2022 ABL Credit Facility of $0.5 million.
For the year ended December 31, 2024, net cash used in financing activities was $12.7 million, consisting primarily of $8.5 million of debt issuance costs, $2.8 million of principal payments under the ME/RE Loans and $1.4 million of principal payments under the Corre Incremental Term Loan, partially offset by the net borrowings on our 2022 ABL Credit Agreement of $0.5 million.
Non-GAAP Financial Measures and Reconciliations We use supplemental non-GAAP financial measures which are derived from the consolidated financial information including adjusted net income (loss); adjusted net income (loss) per share; earnings before interest and taxes (“EBIT”); adjusted EBIT; adjusted earnings before interest, taxes, depreciation, and amortization (“adjusted EBITDA”) and free cash flow to supplement financial information presented on a GAAP basis.
Non-GAAP Financial Measures and Reconciliations We use supplemental non-GAAP financial measures which are derived from the consolidated financial information including adjusted net income (loss); adjusted net income (loss) per share; earnings before interest and taxes (“EBIT”); adjusted EBIT; adjusted earnings before interest, taxes, depreciation, and amortization (“adjusted EBITDA”) and free cash flow to supplement financial information presented on a U.S.
We based this assessment on assumptions that may prove to be inaccurate, and we could exhaust our available capital resources sooner than we expect in the event that we fail to meet our current projections. See Note 11 - Debt of the consolidated financial statements for a further discussion of our liquidity.
We based this assessment on assumptions that may prove to be inaccurate, and we could exhaust our available capital resources sooner than we expect in the event that we fail to meet our current financial performance expectations. See Note 11 - Debt of the consolidated financial statements for a further discussion of our liquidity.
Based upon such liquidity assessment, we believe that the Company’s current working capital, forecasted cash flows from operations, expected availability under our existing debt arrangements and capital expenditure financing is sufficient to fund our operations, service our indebtedness, and maintain compliance with our debt covenants for the next twelve months, and based on current expectations, the long-term.
Based upon such liquidity assessment, we believe that the Company’s current working capital, forecasted cash flows from operations, current and expected availability under our 19 Table of Content existing debt arrangements and capital expenditure financing is sufficient to fund our operations, service our indebtedness, and maintain compliance with our debt covenants for the next twelve months, and based on current expectations, the long term.
The pension plan was frozen in 1994 and no new participants have been added since that date. 17 Table of Content TEAM, INC.
The pension plan was frozen in 1994 and no new participants have been added since that date. 18 Table of Content TEAM, INC.
Reconciliations of each non-GAAP financial measure to its most directly comparable GAAP financial measure are presented below. The following tables set forth the reconciliation of Adjusted Net Income (Loss), EBIT and EBITDA to their most comparable GAAP financial measurements on a consolidated and segmented basis: 16 Table of Content TEAM, INC.
Reconciliations of each non-GAAP financial measure to its most directly comparable U.S. GAAP financial measure are presented below. The following tables set forth the reconciliation of adjusted net income (loss), EBIT and EBITDA to their most comparable U.S. GAAP financial measurements on a consolidated and segmented basis: 17 Table of Content TEAM, INC.
Effect of exchange rate changes on cash . For the year ended December 31, 2024, the effect of foreign exchange rate changes on cash was a negative impact of $0.6 million. For the year ended December 31, 2023, the effect of foreign exchange rate changes on cash was a positive impact of $0.3 million.
Effect of exchange rate changes on cash . For the year ended December 31, 2025, the effect of foreign exchange rate changes on cash was a positive impact of $0.2 million. For the year ended December 31, 2024, the effect of foreign exchange rate changes on cash was a negative impact of $0.6 million.
For the year ended December 31, 2024, net cash used in investing activities was $9.3 million, consisting of $9.5 million of capital expenditures offset by net proceeds from asset disposals of $0.2 million.
For the year ended December 31, 2025, net cash used in investing activities was $9.1 million, consisting of $9.3 million of capital expenditures partially offset by net proceeds from asset disposals of $0.2 million.
The provision for income tax was $3.3 million on the pre-tax loss of $35.0 million in the current year compared to the provision for income tax of $4.6 million on pre-tax loss of $71.1 million in the prior year. The provision for income tax was primarily driven by jurisdictions outside the United States.
The provision for income tax was $2.6 million on the pre-tax loss of $46.6 million in the current year compared to a provision for income tax of $3.3 million on pre-tax loss of $35.0 million in the prior year. The provision for income tax was primarily driven by jurisdictions outside the United States.
As of March 17, 2025, we had consolidated cash and cash equivalents of $10.1 million, excluding $4.3 million of restricted cash used mainly as collateral for outstanding letters of credit and commercial card programs, and approximately $16.1 million of undrawn availability under our various credit facilities, resulting in total liquidity of $26.2 million.
As of March 10, 2026, we had consolidated cash and cash equivalents of $17.7 million, excluding $4.4 million of restricted cash used mainly as collateral for outstanding letters of credit and commercial card programs, and approximately $49.1 million of undrawn availability under our various credit facilities, resulting in total liquidity of $66.8 million.
This was primarily driven by the foreign currency transaction gains in the current year period reflecting the effects of positive fluctuations in the value of the U.S. dollar relative to the foreign currencies to which we have exposure. Taxes.
This was primarily driven by the foreign currency transaction losses in the current year, reflecting unfavorable fluctuations in the value of the U.S. dollar relative to the foreign currencies to which we are exposed. Taxes.
“Risk Factors” included in this report, and have caused fluctuations in our results in the past and are expected to cause fluctuations in our results in the future. Additional information with respect to certain factors are described below. Financing Transactions. On September 30, 2024, we entered into certain amendments with our lenders.
“Risk Factors” included in this report, and have caused fluctuations in our results in the past and are expected to cause fluctuations in our results in the future. Additional information with respect to certain factors are described below.
The effective tax rate was a provision of 9.4% and 6.4% for years ended December 31, 2024 and 2023, respectively.
The effective tax rate was 5.5% and 9.4% for years ended December 31, 2025 and 2024, respectively.
Cash interest paid for the years ended December 31, 2024 and 2023 amounted to $24.9 million and $19.5 million, respectively. Loss on debt extinguishment . There was no loss on debt extinguishment for the year ended December 31, 2024.
Cash interest paid for the years ended December 31, 2025 and 2024 amounted to $30.3 million and $24.9 million, respectively. Loss on debt extinguishment .
For the year ended December 31, 2023, net cash used in investing activities was $10.0 million, consisting of $10.4 million of capital expenditures offset by net proceeds from asset disposals of $0.4 million. 20 Table of Content Cash flows attributable to our financing activities.
For the year ended December 31, 2024, net cash used in investing activities was $9.3 million, consisting of $9.5 million of capital expenditures partially offset by net proceeds from asset disposals of $0.2 million. Cash flows attributable to our financing activities. For the year ended December 31, 2025, net cash provided by financing activities totaled $2.8 million.
Our ability to maintain compliance with the financial covenants contained in our credit agreements is dependent upon our future operating performance and future financial condition, both of which are subject to various risks and uncertainties. On March 12, 2025, we entered into certain debt refinancing transactions with our existing and new lenders.
As of December 31, 2025 we were in compliance with our debt covenants. Our ability to maintain compliance with the financial covenants contained in our credit agreements is dependent upon our future operating performance and future financial condition, both of which are subject to various risks and uncertainties, as described elsewhere herein.
ABL Amendment No.5 significantly improved availability under our Revolving Credit Loans and as of December 31, 2024, we had approximately $45.9 million of available borrowing capacity under our various credit facilities, consisting of $35.9 million available under the 2022 ABL Credit Facility and $10.0 million available under the A&R Term Loan Credit Agreement.
As of December 31, 2025, we had approximately $63.4 million of available borrowing capacity under our various credit facilities, consisting of $53.4 million available under the 2022 ABL Credit Agreement and $10.0 million available under the Second A&R Second Lien Term Loan Agreement.
Other income (expense), net changed by $3.8 million, from an expense of $1.1 million in the prior year to income of $2.7 million in 2024.
Other income (expense), net . Other income (expense), net, changed by $5.6 million, shifting from net income of $2.7 million in the prior year to a net expense of $2.9 million in 2025.
Cash Flows The following table summarizes cash flows from Operating, Investing and Financing activities (in thousands): Twelve Months Ended December 31, Cash flows provided by (used in): 2024 2023 Favorable (Unfavorable) Operating activities $ 22,767 $ (10,986) $ 33,753 Investing activities (9,298) (10,016) 718 Financing activities (12,747) (1,899) (10,848) Effect of exchange rate changes on cash (604) 253 (857) Net change in cash and cash equivalents $ 118 $ (22,648) $ 22,766 Cash and cash equivalents .
Cash Flows The following table summarizes cash flows from Operating, Investing and Financing activities (in thousands): Twelve Months Ended December 31, Cash flows provided by (used in): 2025 2024 Favorable (Unfavorable) Operating activities $ (11,348) $ 22,767 $ (34,115) Investing activities (9,061) (9,298) 237 Financing activities 2,807 (12,747) 15,554 Effect of exchange rate changes on cash 202 (604) 806 Net change in cash and cash equivalents $ (17,400) $ 118 $ (17,518) Cash and cash equivalents .
AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Continued) (unaudited, in thousands) Twelve Months Ended December 31, 2024 2023 IHT Operating income $ 37,012 $ 24,220 Professional fees and other 1 162 941 Severance charges, net 3 551 492 Adjusted EBIT 37,725 25,653 Depreciation and amortization 11,778 12,402 Adjusted EBITDA $ 49,503 $ 38,055 MS Operating income $ 27,287 $ 27,759 Professional fees and other 1 140 147 Legal costs and other 2 41 — Severance charges, net 3 588 792 Adjusted EBIT 28,056 28,698 Depreciation and amortization 18,061 18,755 Adjusted EBITDA $ 46,117 $ 47,453 Corporate and shared support services Net loss $ (102,565) $ (127,701) Provision for income taxes 3,276 4,578 Gain on sale of assets (5) (291) Interest expense, net 47,808 55,181 Foreign currency loss (gain) (2,231) 734 Professional fees and other 1 3,809 8,033 Legal costs and other 2 83 5,635 Severance charges, net 3 184 280 Loss on debt extinguishment 4 — 1,585 Write-off of other assets 5 — 1,295 Pension credit 6 (446) (640) Adjusted EBIT (50,087) (51,311) Depreciation and amortization 6,456 6,715 Non-cash share-based compensation costs 2,273 1,590 Adjusted EBITDA $ (41,358) $ (43,006) _________________ 1 The twelve months ended December 31, 2024, includes $3.8 million related to costs associated with debt financing, and $0.3 million for lease extinguishment charges, support and other costs.
AND SUBSIDIARIES RECONCILIATION OF NON-GAAP FINANCIAL MEASURES (Continued) (unaudited, in thousands) Twelve Months Ended December 31, 2025 2024 IHT Operating income $ 43,855 $ 37,012 Professional fees and other 1 985 162 Severance charges, net 180 551 Adjusted EBIT 45,020 37,725 Depreciation and amortization 12,032 11,778 Adjusted EBITDA $ 57,052 $ 49,503 MS Operating income $ 26,424 $ 27,287 Professional fees and other 1 71 140 Legal costs 251 41 Severance charges, net 1,260 588 Adjusted EBIT 28,006 28,056 Depreciation and amortization 16,755 18,061 Adjusted EBITDA $ 44,761 $ 46,117 Corporate and shared support services Net loss $ (119,489) $ (102,565) Provision for income taxes 2,580 3,276 Gain on sale of assets (216) (5) Interest expense, net 44,676 47,808 Foreign currency loss (gain) 3,274 (2,231) Professional fees and other 1 7,130 3,809 Legal costs and litigation reserves 1,869 83 Severance charges, net 30 184 Loss on debt extinguishment 13,136 — Write-off of software cost 45 — Pension credit 2 (213) (446) Adjusted EBIT (47,178) (50,087) Depreciation and amortization 5,295 6,456 Non-cash share-based compensation costs 795 2,273 Adjusted EBITDA $ (41,088) $ (41,358) Consolidated Adjusted EBITDA $ 60,725 $ 54,262 _________________ 1 The twelve months ended December 31, 2025 include $1.7 million related to debt financing and $6.5 million related to support costs.
The pension plan was frozen in 1994 and no new participants have been added since that date. 18 Table of Content Liquidity and Capital Resources Prior to consummation of the Refinancing Transactions on March 12, 2025, financing for operations consisted primarily of our 2022 ABL Credit Agreement (which includes the Revolving Credit Loans, the Delayed Draw Term Loan and the ME/RE Loans (each as defined herein)), the A&R Term Loan Credit Agreement (which includes the Uptiered Loan and the Incremental Term Loan (each as defined herein)), and cash flows from our operations.
The pension plan was frozen in 1994 and no new participants have been added since that date. Liquidity and Capital Resources Financing for operations consists primarily of our 2022 ABL Credit Agreement, Second A&R Second Lien Term Loan Agreement , and cash flows from our operations.
The detail of operating income (loss) excluding non-core expenses is below (unaudited) (in thousands): Twelve Months Ended December 31, Favorable (Unfavorable) 2024 2023 $ % Operating income (loss) $ 10,136 $ (13,276) $ 23,412 176.3 % Professional fees and other 4,111 9,121 5,010 54.9 % Legal costs 124 5,635 5,511 97.8 % Severance charges, net 1,323 1,564 241 15.4 % Total non-core expenses 5,558 16,320 10,762 65.9 % Total operating income, excluding non-core expenses $ 15,694 $ 3,044 $ 12,650 415.6 % Excluding the impact of these identified non-core expenses in both periods, operating income increased by $12.7 million from $3.0 million to $15.7 million.
The detail of operating income excluding non-core expenses is below (in thousands): Twelve Months Ended December 31, Favorable (Unfavorable) 2025 2024 $ % Operating income $ 14,071 $ 10,136 $ 3,935 38.8 % Professional fees and other 8,186 4,111 (4,075) (99.1) % Legal costs and litigation reserves 2,120 124 (1,996) (1609.7) % Severance charges, net 1,470 1,323 (147) (11.1) % Total non-core expenses 11,776 5,558 (6,218) (111.9) % Total operating income, excluding non-core expenses $ 25,847 $ 15,694 $ 10,153 64.7 % Excluding the impact of these identified non-core expenses in both periods, operating income in 2025 increased year over year by $10.2 million from $15.7 million to $25.9 million.
These decreases were partially offset by a $7.1 million increase in U.S. operations, primarily due to higher callout and turnaround activities in various locations attributable to higher demand for our non-destructive testing services, and a $3.0 million increase in revenue related to aerospace driven by improved utilization at our Cincinnati facility.
IHT revenues increased by $32.2 million or 7.5%, primarily attributable to a $24.3 million increase in U.S. operations driven by higher call-out and turnaround activity with new and existing customers, reflecting increased demand for non-destructive testing services. Aerospace-related revenue increased by $4.2 million, attributable to growth with existing customers at our Cincinnati facility.
The impact of our cost reduction efforts has been partially offset by continued cost inflation in several areas across all segments, such as raw materials, transportation, and labor. 14 Table of Content The operating income for the current year includes net expenses totaling $5.6 million which we do not believe are connected to our core operating activities, while the same period in the prior year included $16.3 million of such items.
Corporate operating loss increased by $2.0 million year over year, primarily due to higher professional costs related to debt and equity refinancing activities in the current year. 15 Table of Content The operating income for the current year includes net expenses totaling $11.8 million which we do not believe are connected to our core operating activities, while the same period in the prior year included $5.6 million of such items.
MS operating income decreased by $0.5 million year over year to $27.3 million for 2024, mainly due to decreased revenue levels in Canada and other international locations, partially offset by a $5.3 million increase in operating income from U.S. operations driven by higher margins.
MS operating income totaled $26.4 million, a decrease of $0.9 million year over year. This decline was mainly attributable to a $5.4 million decrease in international regions, primarily due to lower project activity levels. The decrease was partially offset by a $3.9 million improvement in U.S. operating income, due to better margins, and a $0.6 million increase in Canada.
For the year ended December 31, 2024, net cash provided by operating activities was $22.8 million.
For the year ended December 31, 2025, net cash used in operating activities was $11.3 million, representing a decrease of $34.1 million compared to $22.8 million of cash provided by operating activities in the 2024 period. This change was primarily driven by the impact of working capital.
In the event we are unable to maintain the listing of our shares on the NYSE, we may look to list our shares on alternative exchanges. 13 Table of Content Results of Operations Year Ended December 31, 2024 Compared to Year Ended December 31, 2023 The following table sets forth the components of revenue and operating income (loss) from our operations for the twelve months ended December 31, 2024 and 2023 (in thousands): Twelve Months Ended December 31, Favorable (Unfavorable) 2024 2023 $ % Revenues by business segment: IHT $ 426,722 $ 429,559 $ (2,837) (0.7) % MS 425,550 433,056 (7,506) (1.7) % Total revenues $ 852,272 $ 862,615 $ (10,343) (1.2) % Operating income (loss): IHT 37,012 24,220 12,792 52.8 % MS 27,287 27,759 (472) (1.7) % Corporate and shared support services (54,163) (65,255) 11,092 17.0 % Total operating income (loss) $ 10,136 $ (13,276) $ 23,412 176.3 % Interest expense, net (47,808) (55,181) 7,373 13.4 % Loss on debt extinguishment — (1,585) 1,585 100.0 % Other income (expense), net 2,682 (1,102) 3,784 343.4 % Loss before income taxes $ (34,990) $ (71,144) $ 36,154 50.8 % Provision for income taxes (3,276) (4,578) 1,302 28.4 % Net loss $ (38,266) $ (75,722) $ 37,456 49.5 % Revenues.
Additional information regarding the related debt amendments is provided in Note 11 - Debt. 14 Table of Content Results of Operations Year Ended December 31, 2025 Compared to Year Ended December 31, 2024 The following table sets forth the components of revenue and operating income (loss) from our operations for the twelve months ended December 31, 2025 and 2024 (in thousands): Twelve Months Ended December 31, Favorable (Unfavorable) 2025 2024 $ % Revenues by business segment: IHT $ 458,879 $ 426,722 $ 32,157 7.5 % MS 437,604 425,550 12,054 2.8 % Total revenues $ 896,483 $ 852,272 $ 44,211 5.2 % Operating income (loss): IHT 43,855 37,012 6,843 18.5 % MS 26,424 27,287 (863) (3.2) % Corporate and shared support services (56,208) (54,163) (2,045) (3.8) % Total operating income $ 14,071 $ 10,136 $ 3,935 38.8 % Interest expense, net (44,676) (47,808) 3,132 6.6 % Loss on debt extinguishment (13,136) — (13,136) NM Other income (expense), net (2,889) 2,682 (5,571) (207.7) % Loss before income taxes $ (46,630) $ (34,990) $ (11,640) (33.3) % Provision for income taxes (2,580) (3,276) 696 21.2 % Net loss $ (49,210) $ (38,266) $ (10,944) (28.6) % NM - not meaningful Revenues.
IHT’s operating income increased by $12.8 million or 52.8%, primarily driven by lower costs and higher gross margins in U.S. operations, partially offset by a decrease in operating income from Canada driven mainly by the factors described above.
IHT’s operating income increased by $6.8 million or 18.5%, driven mainly by a $5.8 million improvement in the U.S. due to stronger gross margins and a continued focus on cost containment. Operating income in both Canada and other international regions increased by $0.5 million each, mainly due to the factors described above.
Total revenues decreased by $10.3 million or 1.2% from the prior year. Total revenue was negatively impacted by $0.2 million of unfavorable foreign exchange rate movements during 2024.
Total revenues increased by $44.2 million or 5.2% compared to the prior year. This increase includes a $2.3 million positive impact from favorable foreign exchange rate movements during 2025.
MS revenues decreased by $7.5 million or 1.7%, over prior year, driven by a $7.7 million decrease in Canada turnaround activity, and a $2.3 million decrease in revenue from our international operations attributable to lower activity in leak repair, machining and bolting, and hot tapping services primarily in Europe and the United Kingdom.
These increases were partially offset by a $9.9 million decline in revenue from our international operations, primarily in Latin America and the United Kingdom, attributable to lower project activity in call-out and leak repair services. Operating income (loss) . Overall operating income increased by $3.9 million to $14.1 million in 2025, compared to $10.1 million in the prior year.
Our cash and cash equivalents as of December 31, 2024 totaled $35.5 million, of which $5.1 million was in foreign accounts, primarily in Europe, Canada and Australia, including $1.1 million of cash located in countries where currency restrictions exist.
Our cash and cash equivalents as of December 31, 2024 totaled $35.5 million, including $31.5 million of unrestricted cash on hand, and $4.0 million of restricted cash.
Twelve months ended December 31, 2023 includes $3.9 million related to accruals for the potential repayment of pandemic related subsidies in foreign jurisdiction. 3 Represents customary severance costs associated with staff reductions across multiple departments. 4 Represents loss on the early payoff of the remaining APSC Term Loan in June 2023. 5 The twelve months ended December 31, 2023 represents $0.7 million loss on settlement of a note receivable and an additional $0.6 million for the write-off of software related costs. 6 Represents pension credits for the U.K. pension plan based on the difference between the expected return on plan assets and the amount of the discounted pension liability.
The twelve months ended December 31, 2024 include $3.8 million related to debt financing and $0.3 million for lease extinguishment charges, support and other costs. 2 Represents pension credits for the U.K. pension plan based on the difference between the expected return on plan assets and the amount of the discounted pension liability.
Refer to Note 11 - Debt and Note 19 - Subsequent Events for additional information about our debt instruments.
We also have $30.0 million of Series B Delayed Draw availability as described above. Refer to Note 11 - Debt for additional information about our debt instruments.
Twelve months ended December 31, 2023 includes $3.9 million related to accruals for the potential repayment of pandemic related subsidies in foreign jurisdiction. 3 Represents customary severance costs associated with staff reductions across multiple departments. 4 Represents loss on the early payoff of the remaining APSC Term Loan in June 2023. 5 The twelve months ended December 31, 2023 represents $0.7 million loss on settlement of a note receivable and an additional $0.6 million for the write-off of software related costs. 6 Represents the tax effect of the adjustments. 7 Represents pension credits for the U.K. pension plan based on the difference between the expected return on plan assets and the amount of the discounted pension liability.
The twelve months ended December 31, 2024 include $3.8 million related to debt financing and $0.3 million for lease extinguishment charges, support and other costs. 2 Represents pension credits for the U.K. pension plan based on the difference between the expected return on plan assets and the amount of the discounted pension liability.
Removed
Refer to Note 11 - Debt of the consolidated financial statements for additional details. On March 12, 2025, we entered into certain debt refinancing transactions with our existing and new lenders (collectively, the “Refinancing Transactions”). Refer to Note 19 - Subsequent Events of the consolidated financial statements for additional details about the transactions. Listing Notice from NYSE .
Added
Financing Transactions March 12, 2025 - Debt Refinancing Transactions On March 12, 2025, the Company completed a series of refinancing transactions, including entering into the First Lien Term Loan Agreement with HPS Investment Partners, LLC as agent, which provided for a $225.0 million senior secured first lien term loan consisting of a $175.0 million initial term loan tranche and a $50.0 million delayed draw term loan tranche, both maturing on March 12, 2030, with proceeds of the initial term loan tranche used to repay certain then-existing term loans and with future draws subject to certain leverage and liquidity conditions available to repay term loans outstanding under the Second A&R Second Lien Term Loan Agreement.
Removed
On March 14, 2024, we were notified by the NYSE of our non-compliance with their continued listing standards, as our total market capitalization and shareholders’ equity had fallen below the NYSE listing requirements.
Added
Concurrently, the Company entered into the Second A&R Second Lien Term Loan Agreement with Cantor Fitzgerald Securities as agent, which provided for a $107.4 million second lien term loan consisting of a $97.4 million term loan tranche and a $10.0 million delayed draw term loan tranche, both maturing on June 10, 2030, with proceeds of the term loan tranche used to repay certain then-existing term loans under the Existing A&R Term Loan Agreement, and with future draws subject to certain liquidity conditions available for general corporate and working capital purposes.
Removed
As required by the NYSE, we notified the NYSE of our intent to cure the market capitalization and/or shareholders’ equity deficiency and restore our compliance with NYSE continued listing standards.
Added
In connection with these transactions, the Company also executed ABL Amendment No.6 to the 2022 ABL Credit Agreement, which permitted entry into the new term loan agreements, aligned terms across the facilities, and reflected the payoff of previously outstanding term loan tranches under the 2022 ABL Credit Agreement.
Removed
In accordance with applicable NYSE procedures, on April 29, 2024, we submitted a plan advising the NYSE of the definitive actions we have taken and are taking that would bring us into compliance with NYSE continued listing standards within 12 months of receipt of the written notice.
Added
Each of these agreements includes customary borrowing conditions, financial covenants, and default provisions, including increased interest rates upon certain events of default. Additional information regarding the refinancing transactions is provided in Note 11 - Debt.
Removed
The NYSE accepted the plan, and our common stock continued to be listed and traded on the NYSE during the 12-month period beginning March 14, 2024, subject to our compliance with other NYSE continued listing standards and continued periodic review by the NYSE of our progress with respect to our plan.
Added
September 11, 2025 - Preferred Stock Financing Transaction 13 Table of Content On September 11, 2025, the Company entered into a securities purchase agreement (the “Purchase Agreement”) with the Stellex Holder, an affiliate of Stellex Capital Management LLC, resulting in the issuance of (i) 75,000 shares of Series B Preferred Stock and (ii) warrants to purchase an aggregate of 1,453,260 shares of common stock for total consideration of $75.0 million (such issuance, along with the use of proceeds therefrom and the other transactions contemplated thereby, the “Series B Transactions”).
Removed
On March 14, 2025, we received notice from the NYSE that we had regained compliance with the NYSE listing standards. We can provide no assurances that we will be able to maintain the listing of our shares on the NYSE.
Added
The warrants issued as part of the Series B Transactions consisted of warrants to purchase 982,371 shares of the Company’s common stock at an initial exercise price of $23.00 per share (“Tranche A Warrants”) and warrants to purchase 470,889 shares of the Company’s common stock at an initial exercise price of $50.00 per share (“Tranche B Warrants”).
Removed
IHT revenues decreased by $2.8 million or 0.7%, driven by a $10.3 million decrease in Canada operations revenue attributable to reduced scope in certain customer turnaround projects versus the prior year, and a $2.7 million decrease in international regions revenue, primarily in Europe and the United Kingdom.
Added
The proceeds of the Series B Transactions were used to repay a portion of the outstanding loans under the Company’s 2022 ABL Credit Agreement and Second A&R Second Lien Term Loan Agreement, as well as to cover transaction expenses.
Removed
These decreases were offset by revenue increases in U.S. operations of $2.5 million due to higher turnaround activities. Operating income (loss) . Overall operating income improved by $23.4 million to $10.1 million in 2024 as compared to a loss of $13.3 million in the prior year.
Added
Through September 11, 2027, subject to certain conditions, the Purchase Agreement also provides the Company with the option to draw upon (a “Series B Delayed Draw”) up to $30.0 million as a delayed draw, and concurrently issue up to an additional 30,000 shares of Series B Preferred Stock and 581,304 additional warrants.
Removed
Corporate operating loss decreased by $11.1 million year over year, mainly due to lower personnel and professional costs in the current year as compared to the prior year and lower overall costs due to our ongoing cost reduction program.
Added
Each draw must be at least $5.0 million and is subject to satisfying certain conditions, including pro forma compliance with a First Lien Net Leverage Ratio (as defined in the First Lien Term Loan Agreement) of 6.50 to 1.00.
Removed
See our non-GAAP reconciliation for additional details of our non-core expenses. Interest expense, net . Interest expense for 2024 was $47.8 million, a decrease of $7.4 million compared to the prior year. The decrease was primarily attributable to a decrease in accelerated amortization due to the “Maturity Reserve Trigger Date” provision that was previously applicable.
Added
For each $5.0 million draw, the Company will issue 5,000 shares of Series B Preferred Stock and grant an additional 65,491 Tranche A warrants and an additional 31,393 Tranche B warrants.
Removed
This effect was partially offset by increases in interest expense due to higher balances outstanding following the debt refinancing transactions, cash interest rate increases on the Uptiered Loan and paid-in-kind (“PIK”) interest increase due to the increased principal balance of the Uptiered Loan.
Added
Any additional Tranche A warrants will have an initial exercise price equal to the lesser of $30.00 or 110% of the 30-day volume weighted average price of the Company’s common stock, subject to adjustment. Any additional Tranche B warrants will have an initial exercise price of $50.00 per share, subject to adjustment.
Removed
The loss on debt extinguishment for the year ended December 31, 2023 of $1.6 million was mainly due to the early payment premium incurred as part of the payoff of the remaining balance of the APSC Term Loan in June 2023. Other income (expense), net .
Added
The Stellex Holder is not required to participate in more than one draw per calendar quarter.
Removed
The twelve months ended December 31, 2023, includes $6.7 million related to costs associated with debt financing, and $2.4 million, for lease extinguishment charges, support and other costs. 2 Primarily relates to accrued legal matters, adjustments to legal reserves and other non-routine matters.
Added
Pursuant to the Purchase Agreement, the proceeds from the Series B Delayed Draw may be used only for the following purposes: (i) to finance permitted acquisitions and certain growth initiatives (including the costs of expansion into new markets), (ii) to repay loans outstanding under the Company’s First Lien Term Loan Agreement, and (iii) for up to 20% of such net proceeds, to finance the Company’s transformation plan as mutually agreed between the Company and Stellex.
Removed
Twelve months ended December 31, 2024 includes $3.8 million of legal fees, partially offset by $3.7 million related to the reversal of a reserve established for the potential repayment of pandemic related subsidies (see N ote 16 - Commitments and Contingencies ).
Added
Any undrawn amounts under this option are subject to a 1.0% annual commitment fee. The warrants issued in connection with these transactions (the “Stellex Warrants”) are exercisable for 10 years and include customary anti-dilution and participation rights.
Removed
The twelve months ended December 31, 2023, includes $6.7 million related to costs associated with debt financing, and $2.4 million, for lease extinguishment charges, support and other costs. 2 Primarily relates to accrued legal matters, adjustments to legal reserves and other non-routine matters.
Added
Further details regarding the terms, accounting treatment, and features of the Series B Preferred Stock and warrants are provided in Note 14 - Shareholders’ Equity and Note 16 - Redeemable Preferred Stock .
Removed
Twelve months ended December 31, 2024 includes $3.8 million of legal fees, partially offset by $3.7 million related to the reversal of a reserve established for the potential repayment of pandemic related subsidies (see N ote 16 - Commitments and Contingencies ).
Added
In connection with the Series B Transactions, the Company entered into amendments to its First Lien Term Loan Agreement, Second A&R Second Lien Term Loan Agreement, and 2022 ABL Credit Agreement.
Removed
In the preparation of this liquidity assessment, we applied judgment to estimate the projected cash flows of the Company, including the following: (i) projected cash outflows, (ii) projected cash inflows, and (iii) projected availability under the Company’s existing debt arrangements.
Added
These amendments provided the Company with increased flexibility to complete the equity issuance and related transactions, including reductions to interest rate margins, and increased flexibility regarding leverage ratio thresholds, covenants, and mandatory prepayment requirements.
Removed
The cash flow projections were based on known or planned cash requirements for operating and financing costs and include management’s best estimate regarding future customer activity levels, pricing for its services and for its supplies and other factors. Actual results could vary significantly from those projections.
Added
Revenue in Canada increased by $2.5 million driven by growth in non-destructive examination and heat-treating activity from turnaround projects with new and existing customers.
Removed
For example, the threat of recession and related economic repercussions could have a significant adverse effect on our financial position and business condition, as well as that of our customers and suppliers.
Added
MS revenues increased by $12.1 million or 2.8%, over prior year, driven by a $14.6 million increase in U.S. operations due to growth from turnaround activities in the oil and refining sectors, and a $7.4 million increase in Canada mainly from project work.
Removed
Additionally, these events may, among other factors, impact our ability to generate cash flows from operations, access the capital markets on acceptable terms or at all, service our indebtedness, maintain compliance with the financial covenants contained in our various credit agreements and affect our future need or ability to borrow under our credit agreements.
Added
See our non-GAAP reconciliation for additional details of our non-core expenses. Interest expense, net .
Removed
Our ability to access the capital markets will depend on financial, economic and market conditions, many of which are outside of our control, and we may be unable to raise financing when needed, or on terms favorable to us, or at all.

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