LIQUIDITY |
3 Months Ended |
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Mar. 31, 2025 | |
| Equity [Abstract] | |
| LIQUIDITY | LIQUIDITY The Company has identified certain negative financial trends, including recurring operating losses, cash flows from operations that would be negative if not for an arrearage in the payment of preferred dividends, and one previously unfavorably-priced long-term purchase commitment, all as discussed further below.
The Company has taken, and plans to take, a number of actions to enhance liquidity. Although the Company currently expects to meet its near-term liquidity needs, there can be no assurance that its current sources of capital will be sufficient to satisfy its liquidity requirements in the future, which might require additional restructuring activities, including winding down certain non-core service offerings that are deemed to be unprofitable, continuing to review its global footprint and rationalize legal entities, and continuing to review the remaining existing office leases for cost-effectiveness.
The Company has accrued and unpaid dividends due to Searchlight on the mandatorily redeemable preferred stock due to affiliate, which are accrued on a daily basis, compound quarterly and payable quarterly in arrears. Due to the underlying nature of the preferred stock instrument as debt, these dividends are reflected on the condensed consolidated balance sheets as accrued interest due to affiliate. As of March 31, 2025, the Company owed approximately $29.5 million to Searchlight for this accrued interest. As of May 15, 2025, the total amount of the accrued interest due to affiliate was $32.4 million (see Note 8 — Related Party Transactions). The Company plans to continue the arrearage of preferred dividends in order to preserve cash.
Additionally, the Company has purchase commitments payable that were not recorded as liabilities on its condensed consolidated balance sheet as of March 31, 2025, of which $22.1 million is currently expected to be purchased through the remainder of 2025 (see Note 9 — Commitments and Contingencies).
As of March 31, 2025, the Company had approximately $19.7 million of cash on hand and $25.0 million available on the revolving credit facility.
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