0001558370-24-000106 | 10-Q | XBRL Viewer

Print Document View Excel Document

Related-Party Transactions - Consulting Agreement (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Related-Party Transactions
Related party expense	$ 2,845	$ 2,016	$ 8,696	$ 6,189
Consulting Services \| Oakana Holdings Inc
Related-Party Transactions
Related party expense	$ 0
Consulting Services \| Oakana Holdings Inc \| Maximum
Related-Party Transactions
Related party expense		$ 100	$ 100	$ 100

Fair Value Measurement

9 Months Ended

Sep. 30, 2023

Fair Value Measurement

Fair Value Measurement

9. Fair Value Measurement

Assets and Liabilities Measured at Fair Value

The carrying amount of assets and liabilities including current portion of other debt approximated their fair value as of September 30, 2023 and December 31, 2022, due to the relative short maturity of these instruments. Management estimates the fair values of the 2026 Notes and New Notes at approximately 17.0% and 17.0%, respectively, of the respective principal balances outstanding as of September 30, 2023. Management estimated the fair values of the 2023 Term Loans, 2023 Notes and 2026 Notes at approximately 64.0%, 65.0% and 15.5%, respectively, of the respective principal balance outstanding as of December 31, 2022. The fair values of secured borrowings under the Company’s securitization facility, BRCC Facility, Second Lien Note and Senior Secured Term Loan are equal to the respective carrying values. Other debt represents the Company’s outstanding loan balances associated with various hardware, software purchases, maintenance and leasehold improvements along with loans and receivables factoring arrangement entered into by subsidiaries of the Company and as such, the cost incurred would approximate fair value. Property and equipment, intangible assets, capital lease obligations, and goodwill are not required to be re-measured to fair value on a recurring basis. These assets are evaluated for impairment if certain triggering events occur. If such evaluation indicates that impairment exists, the respective asset is written down to its fair value.

The Company determined the fair value of its long-term debt and current portion of long-term debts using Level 2 inputs, including any recent issuance of the debt, the Company’s credit rating, and the current risk-free rate.

The following table provides the carrying amounts and estimated fair values of the Company’s financial instruments as of September 30, 2023 and December 31, 2022:


	Carrying		Fair		Fair Value Measurements
As of September 30, 2023	Amount		Value		Level 1		Level 2		Level 3
Recurring assets and liabilities:
Long-term debt	$	1,043,775	$	219,537	$	—	$	219,537	$	—
Current portion of long-term debts		48,221		48,221		—		48,221		—


	Carrying		Fair		Fair Value Measurements
As of December 31, 2022	Amount		Value		Level 1		Level 2		Level 3
Recurring assets and liabilities:
Long-term debt	$	942,035	$	184,968	$	—	$	184,968	$	—
Current portion of long-term debts		154,802		121,893		—		121,893		—

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Subsequent Events (Details) - Subsequent Events $ / shares in Units, $ in Millions		1 Months Ended
	Oct. 09, 2023 $ / shares shares	Dec. 31, 2023 USD ($)
Subsequent Events
Insurance claim settlement received \| $		$ 10.0
GP-HGM LLC [Member] \| Special Voting Preferred Stock
Subsequent Events
Shares issued in stock \| shares	1,000,000
Common stock issued price	$ 100
Number of votes per share	20,000
Special Voting Stock for an aggregate price	$ 100

Segment and Geographic Area Information - Revenue by segment information (Details) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) segment	Sep. 30, 2022 USD ($)
Segment information
Number of segments \| segment			3
Revenue	$ 253,125	$ 264,038	$ 799,683	$ 810,206
Cost of revenue (exclusive of depreciation and amortization)	198,450	217,842	626,976	658,623
Segment profit	54,675	46,196	172,707	151,583
Selling, general and administrative expenses (exclusive of depreciation and amortization)	35,367	44,369	111,774	137,604
Depreciation and amortization	14,398	17,737	45,848	53,942
Impairment of goodwill and other intangible assets		29,565		29,565
Related party expense	2,845	2,016	8,696	6,189
Interest expense, net	24,708	40,897	113,980	122,928
Debt modification and extinguishment costs (gain), net	(571)	(4,696)	(16,129)	4,305
Sundry expense, net	298	781	2,546	347
Other expense (income), net	(1,069)	(1,115)	(1,583)	12,419
Net loss before income taxes	(21,301)	(83,358)	(92,425)	(215,716)
I T P S Segment
Segment information
Revenue	172,150	185,309	550,848	580,320
Cost of revenue (exclusive of depreciation and amortization)	141,808	157,269	450,353	477,559
Segment profit	30,342	28,040	100,495	102,761
H S Segment
Segment information
Revenue	62,090	60,955	188,740	173,940
Cost of revenue (exclusive of depreciation and amortization)	45,430	48,316	139,182	140,767
Segment profit	16,660	12,639	49,558	33,173
L L P S Segment
Segment information
Revenue	18,885	17,774	60,095	55,946
Cost of revenue (exclusive of depreciation and amortization)	11,212	12,257	37,441	40,297
Segment profit	$ 7,673	$ 5,517	$ 22,654	$ 15,649

Long-Term Debt and Credit Facilities (Details) $ in Thousands							1 Months Ended		3 Months Ended		9 Months Ended
	Jul. 11, 2023 USD ($)	Jun. 10, 2023 USD ($) installment	Feb. 27, 2023 USD ($)	May 06, 2022 USD ($)	Mar. 07, 2022 USD ($)	Dec. 09, 2021 USD ($)	Aug. 31, 2022 USD ($)	Jul. 31, 2022 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Jul. 15, 2023 USD ($)	Dec. 31, 2022 USD ($)	Mar. 31, 2022 USD ($)	Dec. 07, 2021 USD ($)	Nov. 17, 2021 USD ($)	Jul. 12, 2017 USD ($)
Long-Term Debt and Credit Facilities.
Outstanding debt									$ 1,091,996		$ 1,091,996			$ 1,096,837
Borrowings from senior secured revolving facility and BRCC revolver											9,600	$ 20,000
Debt modification and extinguishment costs (gain)									571	$ 4,696	16,129	(4,305)
Second Lien Secured Term Loan
Long-Term Debt and Credit Facilities.
Outstanding borrowings under the facility									31,500		31,500
2023 notes
Long-Term Debt and Credit Facilities.
Interest rate (in percent)																		10.00%
Debt instrument face amount exchanged	$ 3,000
Outstanding debt									$ 9,000		9,000
Debt instrument, repayment made in cash	9,000
Debt modification and extinguishment costs (gain)											$ 9,900
2026 notes
Long-Term Debt and Credit Facilities.
Principal amount																		$ 1,000,000
Interest rate (in percent)									11.50%		11.50%
Debt repayment in cash						$ 225,000
Debt instrument face amount exchanged	956,000					$ 662,700
Outstanding debt	24,000								$ 0		$ 0			$ 980,000
True-up advance paid				$ 5,000
Debt instrument, redemption price percentage											100.00%
Senior Secured New Notes
Long-Term Debt and Credit Facilities.
Principal amount	767,800												$ 44,100
Outstanding debt									$ 811,900		$ 811,900
New Notes issued under the 2023 Exchange
Long-Term Debt and Credit Facilities.
Principal amount	764,800
Public exchange offer per $1,000 of principal amount	800
Debt instrument face amount exchanged	$ 764,800
New Notes issued as consideration for the private exchange of 2023 Term Loans
Long-Term Debt and Credit Facilities.
Interest rate (in percent)	11.50%
Redemption price percentage	100.00%
Debt instrument, redemption price percentage	101.00%
BRCC Facility
Long-Term Debt and Credit Facilities.
Principal amount																$ 115,000	$ 75,000
Interest rate (in percent)																	11.50%
Default rate (in percent)																	13.50%
Maximum borrowing capacity			$ 35,000												$ 51,000
Borrowings from senior secured revolving facility and BRCC revolver			9,600
Transaction fee			$ 5,000
BRCC Facility \| SOFR
Long-Term Debt and Credit Facilities.
Variable interest rate (as a percent)			7.50%
BRCC Term Loan
Long-Term Debt and Credit Facilities.
Debt instrument, repayment made in cash												48,500
Debt modification and extinguishment costs (gain)												1,600
BRCC Revolver
Long-Term Debt and Credit Facilities.
Outstanding debt		$ 3,900								25,900		25,900
Debt instrument, repayment made in cash											3,700
Number of installments \| installment		11
Monthly installments		$ 2,000
Proceeds from initial borrowings											9,600
2023 Term Loans
Long-Term Debt and Credit Facilities.
Debt modification and extinguishment costs (gain)											$ 7,100
Exchange Notes
Long-Term Debt and Credit Facilities.
Debt modification and extinguishment costs (gain)										5,300		5,300
Write off of previously recognized debt issuance costs										100		100
Revolving Loan Exchange and Prepayment Agreement
Long-Term Debt and Credit Facilities.
Principal amount								$ 9,000
Net proceeds from 2026 notes								2,600
Debt repayment in cash								$ 2,100
Outstanding debt							$ 20,200
Line of credit facility cash					$ 50,000
Debt instruments liability recognized on original issuance discount					17,400
Debt instruments accrued additional true up liability												$ 13,600
True-up advance paid							9,900
Write off of previously recognized debt issuance costs					200
Revolving Loan Exchange and Prepayment Agreement \| Other expense
Long-Term Debt and Credit Facilities.
Amount of accrued true up liability expense										$ 1,100
Revolving Loan Exchange and Prepayment Agreement \| Senior secured revolving facility
Long-Term Debt and Credit Facilities.
Debt instrument face amount exchanged					100,000
Revolving Loan Exchange and Prepayment Agreement \| 2026 notes
Long-Term Debt and Credit Facilities.
Principal amount							$ 21,000
Line of credit facility on notes					50,000
Collateral amount				$ 20,000	$ 10,000

Intangible Assets and Goodwill - Intangibles (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Intangibles
Gross Carrying Amount	$ 704,115	$ 701,065
Accumulated Amortization	(530,184)	(500,083)
Intangible Asset, net	173,931	200,982
Carrying amount of indefinite-lived trade names which are not amortizable	5,300
Customer relationships
Intangibles
Gross Carrying Amount	507,675	507,723
Accumulated Amortization	(373,656)	(351,240)
Intangible Asset, net	134,019	156,483
Developed technology
Intangibles
Gross Carrying Amount	88,553	88,553
Accumulated Amortization	(88,026)	(88,000)
Intangible Asset, net	527	553
Patent
Intangibles
Gross Carrying Amount	15	15
Accumulated Amortization	(14)	(6)
Intangible Asset, net	1	9
Trade names
Intangibles
Gross Carrying Amount	8,400	8,400
Accumulated Amortization	(3,100)	(3,100)
Intangible Asset, net	5,300	5,300
Accumulated impairment losses	44,100	44,100
Outsource contract costs
Intangibles
Gross Carrying Amount	17,616	17,184
Accumulated Amortization	(16,131)	(15,509)
Intangible Asset, net	1,485	1,675
Internally developed software
Intangibles
Gross Carrying Amount	55,107	52,441
Accumulated Amortization	(40,786)	(35,095)
Intangible Asset, net	14,321	17,346
Purchased software
Intangibles
Gross Carrying Amount	26,749	26,749
Accumulated Amortization	(8,471)	(7,133)
Intangible Asset, net	$ 18,278	$ 19,616

Stock-Based Compensation - Restricted Stock Unit (Details) - RSU's - 2018 Plan - $ / shares	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Number of Units
Balance at the beginning of the period	8
Balance at the end of the period	8	8
Weighted Average Grant Date Fair Value
Balance at the beginning of the period	$ 6,600.00
Balance at the end of the period	$ 6,600.00	$ 6,600.00
Average Remaining Contractual Life (Years)
Weighted average remaining contractual life (in years)	3 months	1 year
Minimum
Stock-Based Compensation
Vesting period	1 year
Maximum
Stock-Based Compensation
Vesting period	2 years

Segment and Geographic Area Information

9 Months Ended

Sep. 30, 2023

Segment and Geographic Area Information

Segment and Geographic Area Information

13. Segment and Geographic Area Information

The Company’s operating segments are significant strategic business units that align its products and services with how it manages its business, approaches the markets and interacts with customers. The Company is organized into three segments: ITPS, HS, and LLPS.

ITPS: The ITPS segment provides a wide range of solutions and services designed to aid businesses in information capture, processing, decisioning and distribution to customers primarily in the financial services, commercial, public sector and legal industries.

HS: The HS segment operates and maintains an outsourcing business specializing in both the healthcare provider and payer markets.

LLPS: The LLPS segment provides a broad and active array of legal services in connection with class action, labor claims adjudication and employment and other legal matters.

The chief operating decision maker reviews segment profit to evaluate operating segment performance and determine how to allocate resources to operating segments. “Segment profit” is defined as revenue less cost of revenue (exclusive of depreciation and amortization). The Company does not allocate selling, general, and administrative expenses, depreciation and amortization, interest expense, net and sundry expenses (income), net. The Company manages assets on a total company basis, not by operating segment, and therefore asset information and capital expenditures by operating segments are not presented. A reconciliation of segment profit to net loss before income taxes is presented below.


	Three months ended September 30, 2023
	ITPS		HS		LLPS		Total
Revenue	$	172,150	$	62,090	$	18,885	$	253,125
Cost of revenue (exclusive of depreciation and amortization)		141,808		45,430		11,212		198,450
Segment profit		30,342		16,660		7,673		54,675
Selling, general and administrative expenses (exclusive of depreciation and amortization)								35,367
Depreciation and amortization								14,398
Related party expense								2,845
Interest expense, net								24,708
Debt modification and extinguishment costs (gain), net								(571)
Sundry expense, net								298
Other income, net								(1,069)
Net loss before income taxes							$	(21,301)


	Three months ended September 30, 2022
	ITPS		HS		LLPS		Total
Revenue	$	185,309	$	60,955	$	17,774	$	264,038
Cost of revenue (exclusive of depreciation and amortization)		157,269		48,316		12,257		217,842
Segment profit		28,040		12,639		5,517		46,196
Selling, general and administrative expenses (exclusive of depreciation and amortization)								44,369
Depreciation and amortization								17,737
Impairment of goodwill and other intangible assets								29,565
Related party expense								2,016
Interest expense, net								40,897
Debt modification and extinguishment costs (gain), net								(4,696)
Sundry expense, net								781
Other income, net								(1,115)
Net loss before income taxes							$	(83,358)


		Nine months ended September 30, 2023
	ITPS		HS		LLPS		Total
Revenue	$	550,848	$	188,740	$	60,095	$	799,683
Cost of revenue (exclusive of depreciation and amortization)		450,353		139,182		37,441		626,976
Segment profit		100,495		49,558		22,654		172,707
Selling, general and administrative expenses (exclusive of depreciation and amortization)								111,774
Depreciation and amortization								45,848
Related party expense								8,696
Interest expense, net								113,980
Debt modification and extinguishment costs (gain), net								(16,129)
Sundry expense, net								2,546
Other income, net								(1,583)
Net loss before income taxes							$	(92,425)


		Nine months ended September 30, 2022
	ITPS		HS		LLPS		Total
Revenue	$	580,320	$	173,940	$	55,946	$	810,206
Cost of revenue (exclusive of depreciation and amortization)		477,559		140,767		40,297		658,623
Segment profit		102,761		33,173		15,649		151,583
Selling, general and administrative expenses (exclusive of depreciation and amortization)								137,604
Depreciation and amortization								53,942
Impairment of goodwill and other intangible assets								29,565
Related party expense								6,189
Interest expense, net								122,928
Debt modification and extinguishment costs (gain), net								4,305
Sundry expense, net								347
Other expense, net								12,419
Net loss before income taxes							$	(215,716)

- Definition

The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 34
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 26
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 15
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 21
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-URI https://asc.fasb.org/topic&trid=2134510

+ Details

Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Accounts receivable, allowance for doubtful accounts	$ 5,678	$ 6,402
Accumulated depreciation	$ 217,021	$ 207,520
Common stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Common stock shares authorized	1,600,000,000	1,600,000,000
Common stock, shares issued	6,365,353	1,393,889
Common stock, shares outstanding	6,365,353	1,393,276
Preferred stock, par value (in dollars per share)	$ 0.0001	$ 0.0001
Preferred stock, shares authorized	20,000,000	20,000,000
Treasury Stock (in shares)	0	612
Series A Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.0001
Preferred stock, shares authorized	2,800,000
Preferred stock, shares issued	2,778,111	2,778,111
Preferred stock, shares outstanding	2,778,111	2,778,111
Series B Preferred Stock
Preferred stock, par value (in dollars per share)	$ 0.0001
Preferred stock, shares authorized	8,100,000
Preferred stock, shares issued	3,029,900	3,029,900
Preferred stock, shares outstanding	3,029,900	3,029,900

Condensed Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Revenue	$ 253,125	$ 264,038	$ 799,683	$ 810,206
Cost of revenue (exclusive of depreciation and amortization)	198,450	217,842	626,976	658,623
Selling, general and administrative expenses (exclusive of depreciation and amortization)	35,367	44,369	111,774	137,604
Depreciation and amortization	14,398	17,737	45,848	53,942
Impairment of goodwill and other intangible assets		29,565		29,565
Related party expense	2,845	2,016	8,696	6,189
Operating profit (loss)	2,065	(47,491)	6,389	(75,717)
Other expense (income), net:
Interest expense, net	24,708	40,897	113,980	122,928
Debt modification and extinguishment costs (gain), net	(571)	(4,696)	(16,129)	4,305
Sundry expense, net	298	781	2,546	347
Other expense (income), net	(1,069)	(1,115)	(1,583)	12,419
Net loss before income taxes	(21,301)	(83,358)	(92,425)	(215,716)
Income tax expense	(1,807)	(1,924)	(7,005)	(5,721)
Net loss	(23,108)	(85,282)	(99,430)	(221,437)
Net loss attributable to common stockholders	$ (25,298)	$ (87,326)	$ (105,865)	$ (226,613)
Basic (in dollars per share)	$ (3.97)	$ (276.59)	$ (18.08)	$ (1,281.20)
Diluted (in dollars per share)	$ (3.97)	$ (276.59)	$ (18.08)	$ (1,281.20)
Series A Preferred Stock
Other expense (income), net:
Cumulative dividends for Preferred Stock	$ (1,002)	$ (908)	$ (2,923)	$ (2,648)
Series B Preferred Stock
Other expense (income), net:
Cumulative dividends for Preferred Stock	$ (1,188)	$ (1,136)	$ (3,512)	$ (2,528)

Stockholders' Equity - Warrants (Details) - USD ($) $ / shares in Units, $ in Millions	Mar. 15, 2021	Sep. 30, 2023	Mar. 31, 2021
Warrants
Warrants outstanding		2,433
Private Placement
Warrants
Warrants sold		9,731,819
Exercise price of warrant per one Common Stock (in US$ per share)	$ 16,000.00
Shares issued in stock	2,433
Common stock issued price	$ 11,000.00
Gross proceeds from offering expected	$ 26.8
Warrant \| Private Placement
Warrants
Number of securities called by each warrant or right			0.00025
Placement fee Percentage on Gross proceeds	5.50%

Income Taxes

9 Months Ended

Sep. 30, 2023

Income Taxes

Income Taxes

6. Income Taxes

The Company applies an estimated annual effective tax rate (“ETR”) approach for calculating a tax provision for interim periods, as required under GAAP. The Company recorded an income tax expense of $1.8 million and $1.9 million for the three months ended September 30, 2023 and 2022, respectively. The Company recorded an income tax expense of $7.0 million and $5.7 million for the nine months ended September 30, 2023 and 2022, respectively.

The Company's ETR of (8.5)% and (7.6)% for the three and nine months ended September 30, 2023, respectively, differed from the expected U.S. statutory tax rate of 21.0% and was primarily impacted by permanent tax adjustments, state and local current expense, foreign operations, and valuation allowances, including valuation allowances on a portion of the Company’s deferred tax assets on U.S. disallowed interest expense carryforwards created by the provisions of The Tax Cuts and Jobs Act (“TCJA”).

For the three and nine months ended September 30, 2022, the Company's ETR of (2.3)% and (2.7)%, respectively, differed from the expected U.S. statutory tax rate of 21.0% and was primarily impacted by permanent tax adjustments, state and local current expense, foreign operations, and valuation allowances, including valuation allowances on a portion of the Company’s deferred tax assets on U.S. disallowed interest expense carryforwards created by the provisions of the TCJA.

As of September 30, 2023, there were no material changes to either the nature or the amounts of the uncertain tax positions previously determined for the year ended December 31, 2022.

During the three months ended September 30, 2023, the Company entered into an indenture agreement for the Company's New Notes resulting in cancelation of debt income (CODI). Absent an exception, a debtor recognizes CODI upon discharge of its outstanding indebtedness for an amount of consideration that is less than the outstanding debt. The Code provides that a debtor may exclude CODI from taxable income but must reduce certain of its tax attributes by the amount of CODI. Pursuant to the US tax rules, the Company computes the final CODI calculation based on the tax basis as of the last day of the fiscal tax year (i.e., December 31, 2023) which includes the date in which the debt transaction occurred. As such, the Company applied its best estimate as of July 12, 2023 (transaction date) to compute the CODI impact knowing that certain amounts will change based on regular business operations. For the period ended September 30, 2023, the Company estimated CODI in the amount of $600 million will be excluded from taxable income and result in a partial reduction in the gross U.S. federal and state net operating losses, on which there is a full valuation allowance and as such there is no financial statement impact. The Company will finalize the tax effects of CODI, including the estimated tax effects of tax basis and attribute reduction recognized as a result of the debt transaction in the final December 31, 2023 financial statements and subsequent tax return filings.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 21
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32857-109319

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SAB Topic 11.C)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330215-122817

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 17
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32809-109319

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB TOPIC 6.I.5.Q1)
-URI https://asc.fasb.org/extlink&oid=122134291&loc=d3e330036-122817

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 50
-Paragraph 14
-URI https://asc.fasb.org/extlink&oid=121826272&loc=d3e32705-109319

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 270
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=6424409&loc=d3e44925-109338

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-URI https://asc.fasb.org/topic&trid=2144680

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 30
-Section 50
-Paragraph 2
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=6424122&loc=d3e41874-109331

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(h)(2))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

+ Details

Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Current assets
Cash and cash equivalents	$ 6,142	$ 15,073
Restricted cash	39,352	29,994
Accounts receivable, net of allowance for credit losses of $5,678 and $6,402, respectively	96,867	101,616
Related party receivables and prepaid expenses	117	759
Income tax receivable	129
Inventories, net	11,003	16,848
Prepaid expenses and other current assets	21,483	26,206
Total current assets	175,093	190,496
Property, plant and equipment, net of accumulated depreciation of $217,021 and $207,520, respectively	59,604	71,694
Operating lease right-of-use assets, net	38,557	40,734
Goodwill	170,262	186,802
Intangible assets, net	173,931	200,982
Deferred income tax assets	1,417	1,483
Other noncurrent assets	26,509	29,721
Total assets	645,373	721,912
Current liabilities
Current portion of long-term debt	48,221	154,802
Accounts payable	73,742	79,249
Related party payables	2,499	2,473
Income tax payable		2,045
Accrued liabilities	61,447	61,340
Accrued compensation and benefits	53,399	54,143
Accrued interest	24,463	60,901
Customer deposits	16,319	16,955
Deferred revenue	13,842	16,405
Obligation for claim payment	60,037	44,380
Current portion of finance lease liabilities	5,048	5,485
Current portion of operating lease liabilities	11,487	11,867
Total current liabilities	370,504	510,045
Long-term debt, net of current maturities	1,043,775	942,035
Finance lease liabilities, net of current portion	6,815	9,448
Pension liabilities, net	16,861	16,917
Deferred income tax liabilities	11,859	11,180
Long-term income tax liabilities	3,835	2,742
Operating lease liabilities, net of current portion	28,684	31,030
Other long-term liabilities	5,923	6,104
Total liabilities	1,488,256	1,529,501
Commitments and Contingencies (Note 8)
Stockholders' equity (deficit)
Common Stock, par value of $0.0001 per share; 1,600,000,000 shares authorized; 6,365,965 shares issued and outstanding at September 30, 2023 and 1,393,889 shares issued and 1,393,276 shares outstanding at December 31, 2022	261	162
Preferred stock, $0.0001 par value per share, 20,000,000 shares authorized at September 30, 2023 and December 31, 2022, respectively
Additional paid in capital	1,169,517	1,102,619
Less: Common Stock held in treasury, at cost; 0 shares at September 30, 2023 and 612 shares at December 31, 2022		(10,949)
Equity-based compensation	57,524	56,958
Accumulated deficit	(2,058,388)	(1,948,009)
Accumulated other comprehensive loss:
Foreign currency translation adjustment	(8,157)	(4,788)
Unrealized pension actuarial losses, net of tax	(3,641)	(3,583)
Total accumulated other comprehensive loss	(11,798)	(8,371)
Total stockholders' deficit	(842,883)	(807,589)
Total liabilities and stockholders' deficit	645,373	721,912
Series A Preferred Stock
Stockholders' equity (deficit)
Preferred stock, $0.0001 par value per share, 20,000,000 shares authorized at September 30, 2023 and December 31, 2022, respectively	1	1
Series B Preferred Stock
Stockholders' equity (deficit)
Preferred stock, $0.0001 par value per share, 20,000,000 shares authorized at September 30, 2023 and December 31, 2022, respectively

Employee Benefit Plans (Tables)

9 Months Ended

Sep. 30, 2023

Employee Benefit Plans

Schedule of components of the net periodic benefit cost


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Service cost	$	10	$	15	$	30	$	45
Interest cost		766		486		2,275		1,458
Expected return on plan assets		(682)		(724)		(2,025)		(2,172)
Amortization:
Amortization of prior service cost		89		53		266		159
Amortization of net loss		395		646		1,171		1,938
Net periodic benefit cost	$	578	$	476	$	1,717	$	1,428

Fair Value Measurement (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022	Dec. 31, 2021
Carrying amounts and estimated fair values of financial instruments
Goodwill	$ 170,262	$ 186,802	$ 358,323
2023 Term Loans
Assets and liabilities measured at fair value
Fair value percentage		64.00%
2023 notes
Assets and liabilities measured at fair value
Fair value percentage		65.00%
2026 notes
Assets and liabilities measured at fair value
Fair value percentage	17.00%	15.50%
New notes
Assets and liabilities measured at fair value
Fair value percentage	17.00%
Carrying Amount \| Recurring assets and liabilities
Carrying amounts and estimated fair values of financial instruments
Long-term debt	$ 1,043,775	$ 942,035
Current portion of long-term debts	48,221	154,802
Fair Value \| Recurring assets and liabilities
Carrying amounts and estimated fair values of financial instruments
Long-term debt	219,537	184,968
Current portion of long-term debts	48,221	121,893
Fair Value \| Recurring assets and liabilities \| Level 2
Carrying amounts and estimated fair values of financial instruments
Long-term debt	219,537	184,968
Current portion of long-term debts	$ 48,221	$ 121,893

Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Cash flows from operating activities
Net loss			$ (99,430)	$ (221,437)
Adjustments to reconcile net loss
Depreciation and amortization	$ 14,398	$ 17,737	45,848	53,942
Original issue discount, debt premium and debt issuance cost amortization			9,976	10,383
Debt modification and extinguishment gain, net			(17,534)	(1,803)
Impairment of goodwill and other intangible assets		29,565		29,565
Credit loss expense			1,818	704
Deferred income tax provision			680	2,492
Share-based compensation expense			566	694
Unrealized foreign currency gain			(143)	(1,503)
(Gain) loss on sale of assets			(6,579)	548
Change in operating assets and liabilities
Accounts receivable			2,954	83,282
Prepaid expenses and other current assets			8,732	(6,910)
Accounts payable and accrued liabilities			23,667	(37,004)
Related party payables			668	426
Additions to outsource contract costs			(443)	(330)
Net cash used in operating activities			(29,220)	(86,951)
Cash flows from investing activities
Purchase of property, plant and equipment			(5,585)	(14,208)
Additions to patents				(15)
Additions to internally developed software			(2,967)	(2,710)
Proceeds from sale of assets			29,811	194
Net cash provided by (used in) investing activities			21,259	(16,739)
Cash flows from financing activities
Proceeds from issuance of Common Stock from at the market offerings			69,260	245,073
Cash paid for equity issuance costs from at the market offerings			(2,232)	(8,480)
Dividend paid on Series B Preferred Stock				(2,532)
Payment for fractional shares on reverse stock split			(31)
Repurchases of Common Stock for retirement				(487)
Borrowings under factoring arrangement and Securitization Facility			87,653	93,867
Principal repayment on borrowings under factoring arrangement and Securitization Facility			(90,358)	(186,245)
Cash paid for withholding taxes on vested RSUs				(138)
Lease terminations				3
Cash paid for debt issuance costs			(8,273)	(7,125)
Principal payments on finance lease obligations			(3,477)	(4,342)
Borrowings from senior secured revolving facility and BRCC revolver			9,600	20,000
Repayments on senior secured revolving facility				(49,477)
Proceeds from issuance of 2026 Notes				80,620
Borrowings from other loans			41,843	7,500
Cash paid for debt repurchases			(11,858)	(4,712)
Proceeds From Senior Secured Term Loan			40,000
Proceeds from Second Lien Note			31,500
Repayment of BRCC term loan			(48,529)	(59,209)
Principal repayments on senior secured term loans and other loans			(106,657)	(22,829)
Net cash provided by financing activities			8,441	101,487
Effect of exchange rates on cash, restricted cash and cash equivalents			(53)	(1,054)
Net increase in cash, restricted cash and cash equivalents			427	(3,257)
Cash, restricted cash, and cash equivalents
Beginning of period			45,067	48,060	$ 48,060
End of period	$ 45,494	$ 44,803	45,494	44,803	$ 45,067
Supplemental cash flow data:
Income tax payments, net of refunds received			3,369	5,267
Interest paid			80,156	93,405
Noncash investing and financing activities:
Assets acquired through right-of-use arrangements			405	958
Issuance of new notes in exchange of 2026 notes			764,800
Issuance of new notes in exchange of 2023 term loan			2,963
Accrued PIK interest paid through issuance of PIK Notes			44,146
Accrued capital expenditures			$ 1,778	$ 1,916

Fair Value Measurement (Tables)

9 Months Ended

Sep. 30, 2023

Fair Value Measurement

Schedule of fair value of financial instruments


	Carrying		Fair		Fair Value Measurements
As of September 30, 2023	Amount		Value		Level 1		Level 2		Level 3
Recurring assets and liabilities:
Long-term debt	$	1,043,775	$	219,537	$	—	$	219,537	$	—
Current portion of long-term debts		48,221		48,221		—		48,221		—


	Carrying		Fair		Fair Value Measurements
As of December 31, 2022	Amount		Value		Level 1		Level 2		Level 3
Recurring assets and liabilities:
Long-term debt	$	942,035	$	184,968	$	—	$	184,968	$	—
Current portion of long-term debts		154,802		121,893		—		121,893		—

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

+ References + Details

Stock-Based Compensation (Tables)

9 Months Ended

Sep. 30, 2023

Stock-Based Compensation

Summary of the status of restricted stock units


				Average
		Weighted		Remaining
	Number	Average Grant		Contractual Life
	of Units	Date Fair Value		(Years)
Outstanding Balance as of December 31, 2022	8	$	6,600.00	1.00
Granted	—		—
Forfeited	—		—
Vested	—		—
Outstanding Balance as of September 30, 2023	8	$	6,600.00	0.25

Schedule of stock option activity


						Average
		Weighted		Weighted		Remaining
		Average Grant		Average		Vesting Period
	Outstanding	Date Fair Value		Exercise Price		(Years)
Outstanding Balance as of December 31, 2022	352	$	22,554.25	$	47,117.77	0.20
Granted	—		—
Exercised	—		—
Forfeited	(14)		27,703.04
Expired	—		—
Outstanding Balance as of September 30, 2023 (1)	338	$	22,347.33	$	46,554.52	0.03

(1) 329 of the outstanding options are exercisable as of September 30, 2023.

Summary of activity for the market performances of RSU


				Weighted Average
		Weighted		Period Over
	Number	Average		Which Expected
	of Units	Fair Value		to be Recognized
Outstanding Balance as of December 31, 2022	2,125	$	1,820.00	2.98
Granted	—		—
Forfeited	—		—
Vested	—		—
Outstanding Balance as of September 30, 2023	2,125	$	1,820.00	2.98

New Accounting Pronouncements

9 Months Ended

Sep. 30, 2023

New Accounting Pronouncements

New Accounting Pronouncements

2. New Accounting Pronouncements

Recently Adopted Accounting Pronouncements

Effective January 1, 2023, the Company adopted Accounting Standards Update (“ASU”) No. 2016-13, Financial Instruments – Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, to replace the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The Company is required to use a forward-looking expected credit loss model for accounts receivables, loans, and other financial instruments. This ASU along with related additional clarificatory guidance in the ASU No. 2019-05, “Financial Instruments—Credit Losses (Topic 326)” and ASU No. 2019-11, “Codification Improvements to Topic 326, Financial Instruments—Credit Losses”, was also adopted. Adoption of the standard was applied using a modified retrospective approach through a cumulative-effect adjustment to retained earnings as of the effective date. The Company has performed its analysis of the impact on its financial instruments that are within the scope of this guidance, primarily cash equivalents, restricted cash and accounts receivable, based on class of financing receivables which share the same or similar risk characteristics such as customer type and geographic location, among others. For accounts receivable, the Company applied this methodology using aging schedules reflecting how long the receivables have been outstanding, historical collection experience, current and future economic and market conditions. There was no impact to the Company’s opening retained earnings or its condensed consolidated balance sheet upon adoption and as a result, the

balances presented for December 31, 2022, which were derived under the incurred loss model, are comparable to September 30, 2023.

The following table describes the changes in the allowance for expected credit losses for the nine months ended September 30, 2023 (all related to accounts receivables):


Balance at January 1, 2023 of the allowance for expected credit losses	$	6,402
Change in the provision for expected credit losses for the period		(724)
Balance at September 30, 2023 of the allowance for expected credit losses	$	5,678

Effective January 1, 2023, the Company adopted ASU No. 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. The ASU amends ASC 805 to add contract assets and contract liabilities to the list of exceptions to the recognition and measurement principles that apply to business combinations and to require that an entity (acquirer) recognize and measure contract assets and contract liabilities acquired in a business combination in accordance with Topic 606. While primarily related to contract assets and contract liabilities that were accounted for by the acquiree in accordance with ASC 606, the amendments also apply to contract assets and contract liabilities from other contracts to which the provisions of Topic 606 apply, such as contract liabilities from the sale of nonfinancial assets within the scope of Subtopic 610-20. The ASU was applied prospectively. The adoption had no material impact on the Company’s condensed consolidated results of operations, cash flows, financial position or disclosures.

Recently Issued Accounting Pronouncements

In March 2023, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2023-01, Leases (Topic 842): Common Control Arrangements. The FASB-issued guidance clarifies the accounting for leasehold improvements associated with common control leases by requiring that leasehold improvements associated with common control leases be amortized by the lessee over the useful life of the leasehold improvements to the common control group (regardless of the lease term), as long as the lessee controls the use of the underlying asset through a lease. Additionally, leasehold improvements associated with common control leases should be accounted for as a transfer between entities under common control through an adjustment to equity, if, and when, the lessee no longer controls the use of the underlying asset. The amendments in this ASU are effective for annual and interim periods beginning after December 15, 2023. The Company is currently evaluating the impact that adopting this standard will have on its condensed consolidated financial statements.

- Definition

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-URI https://asc.fasb.org/topic&trid=2122394

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 105
-SubTopic 10
-Section 65
-Paragraph 6
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126987489&loc=SL124442142-165695

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 20
-Section 65
-Paragraph 2
-Subparagraph (d)(1)
-URI https://asc.fasb.org/extlink&oid=126986314&loc=SL124402458-218513

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (g)(2)(iii)
-URI https://asc.fasb.org/extlink&oid=124501264&loc=SL117420844-207641

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (b)(4)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22499-107794

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (g)(2)(ii)
-URI https://asc.fasb.org/extlink&oid=124501264&loc=SL117420844-207641

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (g)(2)(i)
-URI https://asc.fasb.org/extlink&oid=124501264&loc=SL117420844-207641

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 1
-Subparagraph (e)(1)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL123482106-238011

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 310
-SubTopic 20
-Section 65
-Paragraph 2
-Subparagraph (d)(2)
-URI https://asc.fasb.org/extlink&oid=126986314&loc=SL124402458-218513

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (g)(2)(iv)
-URI https://asc.fasb.org/extlink&oid=124501264&loc=SL117420844-207641

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section S99
-Paragraph 5
-Subparagraph (SAB Topic 11.M.Q2)
-URI https://asc.fasb.org/extlink&oid=122038215&loc=d3e31137-122693

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 326
-SubTopic 10
-Section 65
-Paragraph 4
-Subparagraph (e)(1)
-URI https://asc.fasb.org/extlink&oid=122640432&loc=SL121648383-210437

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (h)(2)
-URI https://asc.fasb.org/extlink&oid=124501264&loc=SL117420844-207641

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 326
-SubTopic 10
-Section 65
-Paragraph 4
-Subparagraph (e)(2)
-URI https://asc.fasb.org/extlink&oid=122640432&loc=SL121648383-210437

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 848
-SubTopic 10
-Section 65
-Paragraph 1
-Subparagraph (e)(1)
-URI https://asc.fasb.org/extlink&oid=125980421&loc=SL122150809-237846

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 65
-Paragraph 8
-Subparagraph (e)(2)
-URI https://asc.fasb.org/extlink&oid=126983759&loc=SL121830611-158277

Reference 17: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section S99
-Paragraph 6
-URI https://asc.fasb.org/extlink&oid=122038215&loc=SL108384541-122693

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 10
-Section 65
-Paragraph 5
-Subparagraph (f)(1)
-URI https://asc.fasb.org/extlink&oid=128293352&loc=SL126838806-209984

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 65
-Paragraph 6
-Subparagraph (e)(2)
-URI https://asc.fasb.org/extlink&oid=126983955&loc=SL121967933-165497

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (c)(2)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL126732908-238011

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 842
-SubTopic 10
-Section 65
-Paragraph 5
-Subparagraph (f)(3)
-URI https://asc.fasb.org/extlink&oid=128293352&loc=SL126838806-209984

Reference 22: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (c)(1)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL126732908-238011

Reference 23: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 65
-Paragraph 6
-Subparagraph (e)(1)
-URI https://asc.fasb.org/extlink&oid=126983955&loc=SL121967933-165497

Reference 24: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 65
-Paragraph 8
-Subparagraph (e)(1)
-URI https://asc.fasb.org/extlink&oid=126983759&loc=SL121830611-158277

Reference 25: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 2
-Subparagraph (c)(3)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL126732908-238011

Reference 26: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 926
-SubTopic 20
-Section 65
-Paragraph 2
-Subparagraph (f)(1)
-URI https://asc.fasb.org/extlink&oid=120154821&loc=SL120154904-197079

Reference 27: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 926
-SubTopic 20
-Section 65
-Paragraph 2
-Subparagraph (f)(2)
-URI https://asc.fasb.org/extlink&oid=120154821&loc=SL120154904-197079

Reference 28: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22499-107794

Reference 29: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 926
-SubTopic 20
-Section 65
-Paragraph 2
-Subparagraph (f)(3)
-URI https://asc.fasb.org/extlink&oid=120154821&loc=SL120154904-197079

Reference 30: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 65
-Paragraph 6
-Subparagraph (e)(3)
-URI https://asc.fasb.org/extlink&oid=126983955&loc=SL121967933-165497

Reference 31: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 848
-SubTopic 10
-Section 65
-Paragraph 2
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=125980421&loc=SL125981372-237846

Reference 32: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (c)(1)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22499-107794

Reference 33: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (b)(1)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22499-107794

Reference 34: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 740
-SubTopic 10
-Section 65
-Paragraph 8
-Subparagraph (e)(3)
-URI https://asc.fasb.org/extlink&oid=126983759&loc=SL121830611-158277

+ Details

Stock-Based Compensation - Options (Details) - USD ($) $ / shares in Units, $ in Millions		3 Months Ended		9 Months Ended		12 Months Ended
	Jan. 18, 2018	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
2013 Plan and 2018 Plan \| Selling, general and administrative expense
Unrecognized compensation expense
Compensation expense			$ 0.2		$ 0.6
Reversed compensation expense				$ (0.1)
2013 Plan and 2018 Plan \| Selling, general and administrative expense \| Maximum
Unrecognized compensation expense
Reversed compensation expense		$ (0.1)
Stock options
Outstanding
Exercised (in shares)				329
Stock options \| 2013 Plan and 2018 Plan \| Maximum
Unrecognized compensation expense
Unrecognized compensation expense		$ 0.1		$ 0.1
Stock options \| 2018 Plan
Stock-based compensation
Minimum fair market value per share of underlying stock used to determine option grant price, as a percent	100.00%
Expiration of stock options	10 years
Outstanding
Outstanding Balance at beginning of the year (in shares)				352
Forfeited (in shares)				(14)
Outstanding Balance at the end of the year (in shares)		338		338		352
Weighted average Grant Date fair Value
Outstanding balance at the beginning of the period				$ 22,554.25
Forfeited				27,703.04
Outstanding balance at the end of the period		$ 22,347.33		22,347.33		$ 22,554.25
Weighted Average Exercise Price
Outstanding Balance at the beginning of the year				47,117.77
Outstanding Balance at the end of the year (in shares)		$ 46,554.52		$ 46,554.52		$ 47,117.77
Additional information
Average Remaining Vesting Period				10 days		2 months 12 days
Stock options \| 2018 Plan \| Minimum
Stock-based compensation
Vesting period	2 years
Stock options \| 2018 Plan \| Maximum
Stock-based compensation
Vesting period	4 years

Segment and Geographic Area Information (Tables)

9 Months Ended

Sep. 30, 2023

Segment and Geographic Area Information

Schedule of reconciliation of segment profit to net loss before income taxes by segment information


	Three months ended September 30, 2023
	ITPS		HS		LLPS		Total
Revenue	$	172,150	$	62,090	$	18,885	$	253,125
Cost of revenue (exclusive of depreciation and amortization)		141,808		45,430		11,212		198,450
Segment profit		30,342		16,660		7,673		54,675
Selling, general and administrative expenses (exclusive of depreciation and amortization)								35,367
Depreciation and amortization								14,398
Related party expense								2,845
Interest expense, net								24,708
Debt modification and extinguishment costs (gain), net								(571)
Sundry expense, net								298
Other income, net								(1,069)
Net loss before income taxes							$	(21,301)


	Three months ended September 30, 2022
	ITPS		HS		LLPS		Total
Revenue	$	185,309	$	60,955	$	17,774	$	264,038
Cost of revenue (exclusive of depreciation and amortization)		157,269		48,316		12,257		217,842
Segment profit		28,040		12,639		5,517		46,196
Selling, general and administrative expenses (exclusive of depreciation and amortization)								44,369
Depreciation and amortization								17,737
Impairment of goodwill and other intangible assets								29,565
Related party expense								2,016
Interest expense, net								40,897
Debt modification and extinguishment costs (gain), net								(4,696)
Sundry expense, net								781
Other income, net								(1,115)
Net loss before income taxes							$	(83,358)


		Nine months ended September 30, 2023
	ITPS		HS		LLPS		Total
Revenue	$	550,848	$	188,740	$	60,095	$	799,683
Cost of revenue (exclusive of depreciation and amortization)		450,353		139,182		37,441		626,976
Segment profit		100,495		49,558		22,654		172,707
Selling, general and administrative expenses (exclusive of depreciation and amortization)								111,774
Depreciation and amortization								45,848
Related party expense								8,696
Interest expense, net								113,980
Debt modification and extinguishment costs (gain), net								(16,129)
Sundry expense, net								2,546
Other income, net								(1,583)
Net loss before income taxes							$	(92,425)


		Nine months ended September 30, 2022
	ITPS		HS		LLPS		Total
Revenue	$	580,320	$	173,940	$	55,946	$	810,206
Cost of revenue (exclusive of depreciation and amortization)		477,559		140,767		40,297		658,623
Segment profit		102,761		33,173		15,649		151,583
Selling, general and administrative expenses (exclusive of depreciation and amortization)								137,604
Depreciation and amortization								53,942
Impairment of goodwill and other intangible assets								29,565
Related party expense								6,189
Interest expense, net								122,928
Debt modification and extinguishment costs (gain), net								4,305
Sundry expense, net								347
Other expense, net								12,419
Net loss before income taxes							$	(215,716)

General (Tables)

9 Months Ended

Sep. 30, 2023

General

Schedule of components of basic and diluted EPS


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net loss attributable to common stockholders (A)	$	(25,298)	$	(87,326)	$	(105,865)	$	(226,613)
Weighted average common shares outstanding – basic and diluted (B)		6,365,353		315,725		5,854,840		176,875
Loss Per Share:
Basic and diluted (A/B)	$	(3.97)	$	(276.59)	$	(18.08)	$	(1,281.20)

Intangible Assets and Goodwill - Goodwill (Details) $ in Thousands	3 Months Ended	9 Months Ended		12 Months Ended
	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) segment	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)
Goodwill
Number of segments \| segment		3
Beginning of Year Balance		$ 186,802	$ 358,323	$ 358,323
Deletions		(16,500)
Impairments				(171,182)
Currency Translation Adjustments		(40)		(339)
End of Year Balance		170,262		186,802
Impairment of goodwill and other intangible assets	$ 29,565		29,565
ITPS
Goodwill
Beginning of Year Balance		81,151	252,672	252,672
Deletions		(16,500)
Impairments				(171,182)
Currency Translation Adjustments		(40)		(339)
End of Year Balance		64,611		81,151
Accumulated impairment losses		487,700		487,700	$ 316,500
HS
Goodwill
Beginning of Year Balance		86,786	86,786	86,786
End of Year Balance		86,786		86,786
LLPS
Goodwill
Beginning of Year Balance		18,865	$ 18,865	18,865
End of Year Balance		18,865		18,865
Accumulated impairment losses		$ 243,400		$ 243,400	$ 243,400

Stockholders' Equity - Preferred Stock (Details) $ / shares in Units, $ in Thousands			3 Months Ended		9 Months Ended
	May 12, 2023 shares	May 17, 2017 Vote shares	Sep. 30, 2023 USD ($) $ / shares shares	Sep. 30, 2022 USD ($) $ / shares	Sep. 30, 2023 USD ($) director $ / shares shares	Sep. 30, 2022 USD ($) $ / shares	Dec. 31, 2022 $ / shares shares	May 17, 2022 $ / shares
Preferred Stock
Preferred stock, shares authorized			20,000,000		20,000,000		20,000,000
Preferred Stock, par value (in dollars per share) \| $ / shares			$ 0.0001		$ 0.0001		$ 0.0001
Dividends, Preferred Stock \| $			$ 1,200	$ 1,100	$ 3,500	$ 2,500
Accumulated dividend \| $						2,532
Conversion of shares (in shares)	1
Reverse stock split	0.005
Series A Preferred Stock
Preferred Stock
Preferred stock, shares authorized			2,800,000		2,800,000
Preferred stock, shares outstanding			2,778,111		2,778,111		2,778,111
Preferred Stock, par value (in dollars per share) \| $ / shares			$ 0.0001		$ 0.0001
Preferred Stock, cumulative dividends rate (in percentage)					10.00%
Accumulated preferred stock, Dividends \| $			$ 1,000	$ 900	$ 2,900	$ 2,600
Additional common stock issuable upon conversion of remaining convertible shares			393		393
Cumulative accrued but unpaid dividends \| $			$ 18,800		$ 18,800
Per share average of cumulative preferred dividends (in dollars per share) \| $ / shares			$ 0.36	$ 0.33	$ 1.05	$ 0.95
Reverse stock split					0.00014
Series B Preferred Stock
Preferred Stock
Preferred stock, shares authorized			8,100,000		8,100,000
Preferred stock, shares outstanding			3,029,900		3,029,900		3,029,900
Preferred Stock, par value (in dollars per share) \| $ / shares			$ 0.0001		$ 0.0001
Conversion of Series A Preferred stock to common shares					3,029,900
Accumulated dividend \| $						$ 2,500
Conversion of shares (in shares)					16,079
Cumulative accrued but unpaid dividends \| $			$ 4,600		$ 4,600
Per share average of cumulative preferred dividends (in dollars per share) \| $ / shares			$ 0.39	$ 0.38	$ 1.16	$ 0.83
Reverse stock split					0.00531
Preferred stock cumulative dividend					6.00%
Number of directors \| director					1
Number of directors in arrears \| director					8
Tandem Preferred Stock
Preferred Stock
Preferred Stock, par value (in dollars per share) \| $ / shares								$ 0.0001
Number of Tandem preferred stock issued per Series B Preferred Stock		1
Number of vote per share entitled to each share of Tandem Preferred stock \| Vote		1

Significant Accounting Policies - Contract Balances (Details) $ in Thousands	3 Months Ended		6 Months Ended	9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) category	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($)	Jan. 01, 2022 USD ($)
Significant Accounting Policies
Accounts receivable, net	$ 96,867			$ 96,867		$ 101,616	$ 184,102
Deferred revenues	14,881			14,881		17,585	17,518
Customer deposits	16,319			16,319		16,955	17,707
Costs to obtain and fulfill a contract	1,485			1,485		1,674	$ 2,328
Unbilled receivables, net	29,700			29,700		25,700
Revenue recognized from deferred revenue	1,600	$ 1,800	$ 15,300	16,400		16,500
Amortization of contract costs	$ 200	$ 200		$ 600	$ 800	$ 1,100
Practical expedient on incremental costs of obtaining contracts				true
Number of principal categories \| category				2

Long-Term Debt and Credit Facilities

9 Months Ended

Sep. 30, 2023

Long-Term Debt and Credit Facilities

Long-Term Debt and Credit Facilities

5. Long-Term Debt and Credit Facilities

Senior Credit Facilities

On July 12, 2017, subsidiaries of the Company entered into a First Lien Credit Agreement with Royal Bank of Canada, Credit Suisse AG, Cayman Islands Branch, Natixis, New York Branch and KKR Corporate Lending LLC (the “Credit Agreement”) providing Exela Intermediate LLC, a wholly owned subsidiary of the Company, upon the terms and subject to the conditions set forth in the Credit Agreement, (i) a $350.0 million senior secured term loan scheduled to mature July 12, 2023 with an original issue discount of $7.0 million, and (ii) a $100.0 million senior secured revolving facility scheduled to mature on July 12, 2022 (the “Revolving Credit Facility”).

On July 13, 2018, subsidiaries of the Company were able to refinance the $343.4 million of term loans then outstanding under the Credit Agreement (the “Repricing Term Loans”) and borrowed an additional $30.0 million pursuant to incremental term loans (the “2018 Incremental Term Loans”). On April 16, 2019, subsidiaries of the Company borrowed a further $30.0 million pursuant to incremental term loans (the “2019 Incremental Term Loans”, and, together with the 2018 Incremental Terms Loans and Repricing Term Loans, referred to herein as the “2023 Term Loans”). The subsidiaries of the Company made periodic interest and principal repayments on the 2023 Term Loan under the terms of the loan agreements.

On December 9, 2021, in a private exchange transaction, subsidiaries of the Company exchanged $212.1 million of 2023 Term Loans for $84.3 million in cash and $127.8 million principal amount of new 11.500% First-Priority Senior Secured Notes scheduled to mature July 12, 2026 (the “2026 Notes”) issued by Exela Intermediate LLC and Exela Finance Inc., wholly-owned subsidiaries of the Company (together, the “Issuers”).

As a result of the private exchange, repurchases (as discussed below) and periodic principal repayments, $48.4 million aggregate principal amount of the 2023 Term Loans were outstanding as of July 11, 2023, the date the Company fully repaid and discharged the remaining outstanding balance of the 2023 Term Loans by making a cash payment of $44.8 million and by issuance of $3.0 million principal amount of new 11.500% First-Priority Senior Secured Notes scheduled to mature on April 15, 2026 (the “New Notes”) and issued by the Issuers in an exchange transaction (as discussed below). The Company recorded $0.6 million debt extinguishment gain on repayment of the 2023 Term Loans under ASC 470-50 and reported within debt modification and extinguishment costs (gain), net in our condensed consolidated statements of operations for the three and nine months ended September 30, 2023.

The 2023 Term Loans bore interest at a rate per annum of, at the borrower’s option, either (a) a LIBOR rate determined by reference to the costs of funds for Eurodollar deposits for the interest period relevant to such borrowing, adjusted for certain additional costs, subject to a 1.0% floor, or (b) a base rate determined by reference to the highest of (i) the federal funds rate plus 0.5%, (ii) the prime rate and (iii) the one-month adjusted LIBOR plus 1.0%, in each case plus an applicable margin of 6.5% for LIBOR loans and 5.5% for base rate loans.

Revolving Credit Facility; Letters of Credit

As of December 31, 2021, the $100 million Revolving Credit Facility was fully drawn taking into account approximately $0.5 million in letters of credit issued thereunder as of such date. As of December 31, 2022, the Revolving Credit Facility had been prepaid and terminated as described below.

On March 7, 2022, subsidiaries of the Company entered into a Revolving Loan Exchange and Prepayment Agreement with Royal Bank of Canada, Credit Suisse AG, Cayman Islands Branch, KKR Corporate Lending LLC, Granite State Capital Master Fund LP, Credit Suisse Loan Funding LLC and Revolvercap Partners Fund LP exchanging $100.0 million of outstanding Revolving Credit Facility owed by Exela Intermediate LLC, upon the terms and subject to the conditions set forth in the Revolver Exchange agreement, for (i) $50.0 million in cash, and (ii) $50.0 million of 2026 Notes (such exchange, the “Revolver Exchange” and such 2026 Notes, the “Exchange Notes”). Prepayment of Revolving Credit Facility was treated as an extinguishment of debt under ASC 470-50. Accordingly, the Company wrote off the unamortized balance of $0.2 million of debt issuance costs related to Revolving Credit Facility and reported it within debt modification and extinguishment costs (gain), net in our condensed consolidated statements of operations for the nine months ended September 30, 2022.

The Exchange Notes were subject to a guarantee in the form of a true-up mechanism whereby subsidiaries of the Company were responsible to make a payment to the holders of the Exchange Notes to true-up the shortfall below certain agreed thresholds, if holders of the Exchange Notes sold their notes at a price below that threshold during agreed periods in 2022. As security for the true-up obligation under the Revolver Exchange, subsidiaries of the Company issued $10.0 million of principal amount of 2026 Notes as collateral (the “Collateral Notes”). The Collateral Notes were not reflected in the consolidated financial statements unless and until they were sold to third parties. On March 7, 2022, we recognized $17.4 million (the fair value of the true-up obligation as accounted for under ASC 450, Contingencies and ASC 460, Guarantees) as a true-up liability with an offsetting debit to the original issuance discount of the issued Exchange Notes on the closing date of the Revolver Exchange. On May 6, 2022, subsidiaries of the Company amended the true-up mechanism and placed an additional $20.0 million of principal amount of Collateral Notes and paid $5.0 million against the true-up amount payable. We remeasured our obligation under the true-up mechanism as of September 30, 2022 and accrued an additional $13.6 million of true-up liability based on the fair value of our obligation in other expense, net in the condensed consolidated statements of operations for the nine months ended September 30, 2022.

In July 2022, $9.0 million of principal amount of the Collateral Notes were sold by the holders of the Exchange Notes for net proceeds of $2.6 million and the proceeds were applied against the true-up amount payable. Additionally, in July 2022, the Company made a cash payment of $2.1 million which was applied against the true-up amount payable.

In August 2022, the remaining balance of $20.2 million of net true-up liability was settled with cash payments of $9.9 million and by permitting the holders of the Exchange Notes to keep the $21.0 million of principal amount of 2026 Notes previously placed as Collateral Notes constituting an issuance. The Company made a net reversal of $1.1 million of accrued true-up liability in other expense (income), net in the condensed consolidated statements of operations for the three and nine months ended September 30, 2022.

2023 Notes

On July 12, 2017, the Issuers issued $1.0 billion in aggregate principal amount of 10.0% First Priority Senior Secured Notes due 2023 (the “2023 Notes”). The 2023 Notes were guaranteed by nearly all U.S. subsidiaries of Exela Intermediate LLC. The 2023 Notes bore interest at a rate of 10.0% per year. The issuers paid interest on the 2023 Notes on January 15 and July 15 of each year, commencing January 15, 2018.

On December 9, 2021, upon the settlement of a public exchange, $662.7 million aggregate principal amount of the 2026 Notes were issued and an aggregate $225.0 million in cash (plus accrued but unpaid interest) was paid to participating holders in respect of the validly tendered $912.7 million principal amount of outstanding 2023 Notes. The Company concluded that the public exchange of notes represented modification of debt under ASC 470-50.

As a result of the public exchange and repurchases (as discussed below), $9.0 million aggregate principal amount of the 2023 Notes remained outstanding as of July 11, 2023, the date the Company fully repaid the remaining outstanding balance of the 2023 Notes in cash.

2026 Notes

As of December 31, 2022, the Issuers had $980.0 million aggregate principal amount of the 2026 Notes outstanding. During the nine months ended September 30, 2023, no 2026 Notes were sold by subsidiaries of the Company. The 2026 Notes are guaranteed by nearly all U.S. subsidiaries of Exela Intermediate LLC. The 2026 Notes bear interest at a rate of 11.5% per year. We are required to pay interest on the 2026 Notes on January 15 and July 15 of each year, and commenced making such interest payments on July 15, 2022. The 2026 Notes are scheduled to mature on July 12, 2026. The Issuers may redeem the 2026 Notes in whole or in part from time to time, at a redemption price of 100%, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date.

On July 11, 2023, the Issuers, certain guarantors and U.S. Bank Trust Company, National Association, as trustee, entered into an indenture (the “New Notes Indenture”) governing the Company’s New Notes and issued approximately $764.8 million aggregate principal amount of the New Notes as consideration for the exchange of $956.0 million aggregate principal amount of the Issuers’ existing 2026 Notes pursuant to a public exchange offer (the “2023 Exchange”), which was equivalent to issuing $800 of the New Notes per $1,000 principal amount of the existing 2026 Notes. The Company performed an assessment of the 2023 Exchange and determined that it met the criteria to be accounted for as a troubled debt restructuring under ASC 470-60. The undiscounted cash flows associated with the New Notes issued were compared to the carrying value of the exchanged 2026 Notes and since the undiscounted cash flows of the New Notes exceeded the carrying value of the exchanged 2026 Notes, the carrying value of the New Notes was established at the carrying value of the exchanged 2026 Notes and the Company established new effective interest rates based on the carrying value of the exchanged 2026 Notes prior to the 2023 Exchange. The difference between the principal amount of the issued New Notes and their carrying value was recorded as a premium and is included in long-term debt on the Company’s condensed consolidated balance sheets. The Company recorded a premium of $142.3 million on the notes exchange, which will be reduced as contractual interest payments are made on the New Notes.

On July 11, 2023, we entered into a seventh supplemental indenture to the 2026 Notes Indenture which eliminated substantially all of the restrictive covenants, eliminated certain events of default, modified covenants regarding mergers and consolidations and modified or eliminated certain other provisions, including certain provisions relating to future guarantors and defeasance, contained in the 2026 Notes Indenture and the 2026 Notes. In addition, all of the collateral securing the 2026 Notes was released pursuant to the seventh supplemental indenture.

The July 11, 2023 transaction resulted in cancellation of debt income (“CODI”) for tax purposes. Absent an exception, a debtor recognizes CODI upon discharge of its outstanding indebtedness for an amount of consideration that is less than the outstanding debt. The Internal Revenue Code of 1986, as amended, (the “Code”), provides that a debtor may exclude CODI from taxable income but must reduce certain of its tax attributes by the amount of CODI. Pursuant to the US tax rules, the Company computes the final CODI calculation based on the tax basis as of the last day of the fiscal tax year (i.e., December 31, 2023) which includes the date in which the debt transaction occurred. As such, the Company applied its best estimate as of July 12, 2023 (transaction date) to compute the CODI impact knowing that certain amounts will change based on regular business operations. For the period ended September 30, 2023, the Company estimated CODI in the amount of $600 million will be excluded from taxable income and result in a partial reduction in the gross U.S. federal and state net operating losses. The Company will finalize the tax effects of CODI, including the estimated tax effects of tax basis and attribute reduction recognized as a result of the debt transaction in the final December 31, 2023 financial statements and subsequent tax return filings.

As a result of the 2023 Exchange and repurchases (as discussed below), $24.0 million aggregate principal amount of the 2026 Notes maturing July 12, 2026 remained outstanding as of September 30, 2023.

Senior Secured New Notes

On July 11, 2023, the Issuers issued approximately $767.8 million aggregate principal amount of the New Notes under the New Notes Indenture, which includes the New Notes issued under the 2023 Exchange (as described above) and as consideration for the exchange of certain of the Company’s outstanding 2023 Term Loans (as described above). The New Notes are scheduled to mature on April 15, 2026.

Interest on the New Notes will accrue at 11.500% per annum and will be paid semi-annually, in arrears, on January 15 and July 15 of each year, beginning July 15, 2023. Interest will be payable in cash or in kind by issuing additional New Notes (or increasing the principal amount of the outstanding New Notes) (“PIK Interest”) as described below: (A) for the July 15, 2023 interest payment date, such interest was paid in kind as PIK Interest, (B) for each interest payment date from and including the January 15, 2024 interest payment date through and including the July 15, 2024 interest payment date, such interest shall be paid in cash in an amount equal to (i) 50% of such interest plus (ii) an amount not to exceed an amount that, pro forma for such payment, would leave the issuers with Unrestricted Cash (as defined in the New Notes Indenture) of at least $15.0 million, with the remaining interest paid in kind as PIK Interest, and (C) for interest payment dates falling on or after January 15, 2025, such interest shall be paid in cash.

On July 15, 2023, the Company issued $44.1 million in aggregate principal amount of the New Notes as a payment for PIK Interest due on July 15, 2023. $811.9 million aggregate principal amount of the New Notes maturing April 15, 2026 remained outstanding as of September 30, 2023.

The Issuers’ obligations under the New Notes and the New Notes Indenture are irrevocably and unconditionally guaranteed, jointly and severally, by the same guarantors (the “Guarantors”) that guarantee the 2026 Notes (other than certain guarantors that have ceased to have operations or assets) and by certain of the Issuers’ other affiliates (the “Affiliated Guarantors”). The New Notes and the related guarantees are first-priority senior secured obligations of the Issuers, the Guarantors and Affiliated Guarantors.

The issuers may redeem the New Notes at their option, in whole at any time or in part from time to time, at a redemption price of 100%, plus accrued and unpaid interest, if any, to, but excluding, the applicable redemption date. In addition, the New Notes will be mandatorily redeemable in part upon the sale of certain assets that constitute additional credit support.

The New Notes Indenture contains covenants that limit the Issuers’ and the Affiliated Guarantors (as defined below) and their respective subsidiaries’ ability to, among other things, (i) incur or guarantee additional indebtedness, (ii) pay dividends or distributions on, or redeem or repurchase, capital stock and make other restricted payments, (iii) make investments, (iv) consummate certain asset sales, (v) engage in certain transactions with affiliates, (vi) grant or assume certain liens and (vii) consolidate, merge or transfer all or substantially all of their assets. These covenants are subject to a number of important limitations and exceptions. In addition, upon the occurrence of specified change of

control events, the Issuers must offer to repurchase the New Notes at 101% of the principal amount, plus accrued and unpaid interest, if any, to, but excluding, the applicable repurchase date. The New Notes Indenture also provides for events of default, which, if any of them occurs, would permit or require the principal, premium, if any, interest and any other monetary obligations on all of the then outstanding New Notes to be due and payable immediately.

Repurchases

In July 2021, the Company commenced a debt buyback program to repurchase senior secured indebtedness, which is ongoing. During the three and nine months ended September 30, 2022, we repurchased $15.0 million principal amount of the Exchange Notes issued under the Revolver Exchange (as discussed above) for a net cash consideration of $4.7 million. The gain on early extinguishment of debt for the Exchange Notes during the three and nine months ended September 30, 2022 totaled $5.3 million and is inclusive of $5.0 million and $0.1 million write off of original issue discount and debt issuance costs, respectively.

During the nine months ended September 30, 2023, we repurchased $13.8 million principal amount of the 2023 Notes for a cash consideration of $4.4 million. The gain on early extinguishment of debt for the 2023 Notes during the nine months ended September 30, 2023 totaled $9.9 million and is inclusive of less than $0.1 million write off of original issue discount and debt issuance costs. During the nine months ended September 30, 2023, we repurchased $15.1 million principal amount of the 2023 Term Loans for a cash consideration of $8.0 million. The gain on early extinguishment of debt for the 2023 Term Loans during the nine months ended September 30, 2023 totaled $7.1 million and is inclusive of less than $0.1 million write off of original issue discount and debt issuance costs. Gain on the early extinguishment of debt is reported within debt modification and extinguishment costs (gain), net within our condensed consolidated statements of operations.

BRCC Facility

On November 17, 2021, GP2 XCV, LLC, a subsidiary of the Company (“GP2 XCV”), entered into a borrowing facility with B. Riley Commercial Capital, LLC (which was subsequently assigned to BRF Finance Co., LLC (“BRF Finance”)) pursuant to which such subsidiary was able to borrow an original principal amount of $75.0 million, which was later increased to $115.0 million as of December 7, 2021 (as the same may be amended from time to time, the “BRCC Term Loan”). On March 31, 2022, GP2 XCV and B. Riley Commercial Capital, LLC amended this facility to permit GP2 XCV to borrow up to $51.0 million under a separate revolving loan (the “BRCC Revolver”, collectively with the BRCC Term Loan, the “BRCC Facility”).

The BRCC Facility is secured by a lien on all the assets of GP2 XCV and by a pledge of the equity of GP2 XCV. GP2 XCV is a bankruptcy-remote entity, and as such its assets are not available to other creditors of the Company or any of its subsidiaries other than GP2 XCV. Interest under the BRCC Facility accrues at a rate of 11.5% per annum (13.5% per annum default rate) and is payable quarterly on the last business day of each March, June, September and December. The purpose of BRCC Term Loan was to fund certain repurchases of the secured indebtedness and to provide funding for certain debt exchange transactions. The purpose of BRCC Revolver is to fund general corporate purposes.

During the nine months ended September 30, 2023, we borrowed $9.6 million of principal amount under the BRCC Revolver. During the nine months ended September 30, 2023, we repaid $48.5 million and $3.7 million of outstanding principal amount under the BRCC Term Loan and the BRCC Revolver, respectively along with $1.6 million of exit fees on the BRCC Term Loan. The exit fees paid on the prepayment of the BRCC Term Loan were treated as a debt extinguishment cost under ASC 470-50 and reported within debt modification and extinguishment costs (gain), net in our condensed consolidated statements of operations. The BRCC Facility matured on June 10, 2023. As of September 30, 2023, the Company had fully repaid the outstanding balance under the BRCC Term Loan. As of September 30, 2023, there were borrowings of $25.9 million outstanding under the BRCC Revolver. The outstanding principal amount under the BRCC Revolver is payable in eleven (11) monthly installments of $2.0 million commencing October 31, 2023, with the remaining outstanding principal balance of $3.9 million payable on September 30, 2024.

Senior Secured Term Loan

On July 11, 2023, Exela Intermediate LLC and Exela Finance Inc., wholly-owned subsidiaries of the Company, entered into a financing agreement with certain lenders and Blue Torch Finance LLC, as administrative agent, pursuant to which the lenders extended a term loan of principal amount of $40.0 million (“Senior Secured Term Loan”). On the same date, the Company used proceeds of this term loan and cash on hand to repay its outstanding 2023 Notes and 2023 Term Loans.

The Senior Secured Term Loan shall be, at the option of the Company, either a Reference Rate Loan, or a SOFR Rate Loan. Each portion of the Senior Secured Term Loan that is a Reference Rate Loan bears interest on the principal amount outstanding from the date of the Senior Secured Term Loan until repaid, at a rate per annum equal to the Reference Rate plus the Applicable Margin. “Reference Rate” for any period means the greatest of (i) 4.00% per annum, (ii) the federal funds rate plus 0.50% per annum, (iii) the Adjusted Term SOFR (which rate shall be calculated based upon an interest period of 1 month and shall be determined on a daily basis) plus 1.00% per annum, and (iv) the rate last quoted by the Wall Street Journal as the "Prime Rate" in the United States. “Applicable Margin,” with respect to the interest rate of (a) any Reference Rate Loan is 10.39% per annum, and (b) any SOFR Rate Loan is 11.39% per annum. SOFR Rate Loans shall bear interest on the principal amount outstanding, at a rate per annum equal to the Adjusted Term SOFR rate for the Interest Period in effect for the Term Loan plus Applicable Margin. “Adjusted Term SOFR” means the rate per annum equal to Term SOFR for such calculation, plus 0.26161%. “Term SOFR,” for calculation with respect to a SOFR Rate Loan, is the per annum forward-looking term rate based on secured overnight financing rate for a tenor comparable to the applicable interest period on the day that is two business days prior to the first day of such interest period. However, with respect to a Reference Rate Loan, “Term SOFR” means the per annum forward-looking term rate based on secured overnight financing rate for a tenor of three months on the day that is two business days prior to such day. If Term SOFR as so determined shall ever be less than 4.00%, then Term SOFR shall be deemed to be 4.00%.

The Company may, at any time, elect to have interest on all or a portion of the loans be charged at a rate of interest based upon Term SOFR (the “SOFR Option”) by notifying the administrative agent at least 3 business days. Such notice needs to be provided in the case of the continuation of a SOFR Rate Loan as a SOFR Rate Loan on the last day of the then current interest period. The Company shall have not more than 5 SOFR Rate Loans in effect at any given time, and only may exercise the SOFR Option for SOFR Rate Loans of at least $500,000 and integral multiples of $100,000 in excess thereof.

The outstanding principal amount of the Senior Secured Term Loan shall be repaid in eleven (11) equal quarterly installments of $0.5 million commencing December 31, 2023, with the remaining outstanding principal amount of $34.5 million payable at maturity along with accrued and unpaid interest. The maturity date of the Senior Secured Term Loan shall be the earlier of July 11, 2026 and the date that is 91 days prior to the earliest maturity of any of the New Notes or the 2026 Notes (after giving effect to any refinancing indebtedness).

The Company may, at any time, prepay the principal of the Senior Secured Term Loan. Each prepayment shall be accompanied by the payment of accrued interest and the applicable premium, if any. Each prepayment shall be applied against the remaining installments of principal due on the Senior Secured Term Loan in the inverse order of maturity. The applicable premium shall be payable in the form of a make-whole amount if prepayment is made within one year of the borrowing date (the “First Period”). If optional prepayment is made after the year one anniversary of the borrowing date to the date of the two-year anniversary (the “Second Period”), the applicable premium shall be an amount equal to 1% times the amount of the principal amount of the Senior Secured Term Loan being paid on such date. The applicable premium shall be zero in case of prepayment after the date of the two-year anniversary of the borrowing date. Further, during the Second Period, if the prepayment is because of an event of default or termination of contract for any reason, the applicable premium shall be 1% times the aggregate principal amount of the Senior Secured Term Loan outstanding on such date.

The Senior Secured Term Loan contains customary events of default, affirmative and negative covenants, including limitation on the Company’s and certain of its subsidiaries’ ability to create, incur or allow certain liens; enter

into sale and lease-back transactions; make any restricted payments; undergo fundamental changes, as well as certain financial covenants. The Company was in compliance with all financial covenants as of September 30, 2023.

Securitization Facility

On December 17, 2020, certain subsidiaries of the Company entered into a $145.0 million securitization facility with a five year term (the “Securitization Facility”) with certain lenders and Alter Domus (US), LLC, as administrative agent (the “Securitization Administrative Agent”). The Securitization Facility provided for an initial funding of approximately $92.0 million supported by receivables, and, subject to contribution, a further funding of approximately $53.0 million to be supported by inventory and intellectual property. On December 17, 2020, Exela Receivables 3, LLC (the “Securitization Borrower”) made the initial borrowing of approximately $92.0 million under the Securitization Facility and used a portion of the proceeds to repay $83.0 million of the aggregate outstanding principal amount of loans as of December 17, 2020 under a previous $160.0 million accounts receivable securitization facility (“A/R Facility”) and used the remaining proceeds for general corporate purposes. On April 11, 2021, the Company amended the Securitization Facility to, among other things, extend the period during which the Company could access the approximately $53.0 million in additional borrowings upon the contribution of inventory and intellectual property to support the borrowing base from April 10, 2021 to September 30, 2021.

The Securitization Borrower, Exela Receivables 3 Holdco, LLC (the “Securitization Parent SPE,” and together with the Securitization Borrower, the “SPEs”), the Company, and certain of our operating subsidiaries that agreed to sell receivables in connection with the Securitization Facillity (the “Securitization Originators”) provided customary representations and covenants under the agreements underlying the Securitization Factility. The Securitization Facility identified certain events of default upon the occurrence of which the Securitization Administrative Agent may declare the facility’s termination date to have occurred and declare the outstanding Securitization Loan and all other obligations of the Securitization Borrower to be immediately due and payable, however the Securitization Facility does not include an ongoing liquidity covenant like the A/R Facility and aligns reporting obligations with the Company’s other material indebtedness agreements.

The Securitization Borrower and Securitization Parent SPE were formed in December 2020, and are identified as variable interest entities (“VIE”) and consolidated into the Company’s financial statements following VIE consolidation model under ASC 810. The Securitization Borrower and Securitization Parent SPE are bankruptcy remote entities and as such their assets are not available to creditors of the Company or any of its subsidiaries. Each loan under the Securitization Facility bore interest on the unpaid principal amount as follows: (i) if a Base Rate Loan, at a rate per annum equal to (x) the greatest of (a) the Prime Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 0.50% and (c) the Adjusted LIBOR Rate (as defined in the Securitization Loan Agreement) plus 1.00%, plus (y) 8.75%; or (ii) if a LIBOR Rate Loan, at the Adjusted LIBOR Rate plus 9.75%.

On June 17, 2022, the Company repaid in full the approximately $91.9 million principal amount of loans outstanding under the Securitization Facility,triggered a prepayment premium of $2.7 million and a required payment of approximately $0.5 million and $1.3 million in respect of accrued interest and fees, respectively. All obligations under the Securitization Facility (other than contingent indemnification obligations that expressly survive termination) terminated upon repayment. The Securitization Facility was replaced by the Amended Receivables Purchase Agreement and related agreements described below. Repayment of the Securitization Facility was treated as an extinguishment of debt under ASC 470-50. Accordingly, the Company wrote off the unamortized balance of $3.3 million of debt issuance costs related to the Securitization Facility.

On June 17, 2022, the Company entered into an amended and restated receivables purchase agreement (as amended, the “Amended Receivables Purchase Agreement”) under the Securitization Facility among certain of the Company’s subsidiaries, the SPEs and certain global financial institutions (“Purchasers”). The Amended Receivables Purchase Agreement extends the term of the Securitization Facility such that the SPEs may sell certain receivables to the Purchasers until June 17, 2025. Under the Amended Receivables Purchase Agreement, transfers of accounts receivable from the SPEs are treated as sales and are accounted for as a reduction in accounts receivable, because the agreement transfers effective control over and risk related to the accounts receivable to the Purchasers. The Company and related subsidiaries have no continuing involvement in the transferred accounts receivable, other than collection and

administrative responsibilities and, once sold, the accounts receivable are no longer available to satisfy creditors of the Company, the Securitization Originators, or any other relevant subsidiaries.

On June 17, 2022, the Company sold $85.0 million of its accounts receivable and used the whole proceeds from this sale to repay part of the $91.9 million borrowings under the Securitization Facility (as discussed above). These sales were transacted at 100% of the face value of the relevant accounts receivable, resulting in derecognition of the accounts receivable from the Company’s condensed consolidated balance sheet. The Company de-recognized $408.9 million of accounts receivable under this agreement during the year ended December 31, 2022. The amount remitted to the Purchasers during fiscal year 2022 was $308.7 million. The Company de-recognized $119.3 million and $382.2 million of accounts receivable under this agreement during the three and nine months ended September 30, 2023, respectively. The amount remitted to the Purchasers during the three and nine months ended September 30, 2023 was $119.0 million and $385.5 million, respectively. Unsold accounts receivable of $47.1 million and $46.5 million were pledged by the SPEs as collateral to the Purchasers as of September 30, 2023 and December 31, 2022, respectively. These pledged accounts receivables are included in accounts receivable, net in the condensed consolidated balance sheets. The program resulted in a pre-tax loss of $2.0 million and $5.9 million for the three and nine months ended September 30, 2023, respectively.

The fair value of the sold accounts receivable approximated their book value due to their short-term nature. Sold accounts receivable are presented as a change in receivables within operating activities in the condensed consolidated statements of cash flows.

Second Lien Note

On February 27, 2023, the SPEs and B. Riley Commercial Capital, LLC entered into a new Secured Promissory Note (which was subsequently assigned to BRF Finance) pursuant to which B. Riley Commercial Capital, LLC agreed to lend up to $35.0 million secured by a second lien pledge of the Securitization Borrower (the “Second Lien Note”). The Second Lien Note is scheduled to mature on June 17, 2025 and bears interest at a per annum rate of one-month Term SOFR plus 7.5%. The SPEs are party to the Amended Receivables Purchase Agreement, thus the transactions necessitated amendments to that agreement and related documents to permit the addition of subordinated debt and additional borrowing capacity into that transaction structure, in addition to providing for a $5.0 million fee to the lenders for facilitating the transaction. In connection with the above-described facility, we also amended the BRCC Term Loan and BRCC Revolver to provide for $9.6 million of borrowing capacity, which was drawn as described above.

As of September 30, 2023, there were borrowings of $31.5 million outstanding under the Second Lien Note payable at maturity.

Long-Term Debt Outstanding

As of September 30, 2023 and December 31, 2022, the following long-term debt instruments were outstanding:



	September 30,		December 31,
	2023		2022
Other (a)	$	34,561	$	25,117
2023 term loans (b)		—		71,470
Senior secured term loan maturing July 11, 2026 (c)		38,264		—
2023 notes (d)		—		22,762
2026 notes maturing July 12, 2026 (e)		22,693		908,959
New notes maturing April 15, 2026 (f)		943,642		—
Secured borrowings under BRCC Facility matured on June 10, 2023		25,899		68,529
Second lien note maturing June 17, 2025 (g)		26,937		—
Total debt		1,091,996		1,096,837
Less: Current portion of long-term debt		(48,221)		(154,802)
Long-term debt, net of current maturities	$	1,043,775	$	942,035

(a)	Other debt represents outstanding loan balances associated with various hardware, software purchases, maintenance and leasehold improvements along with loans and receivables factoring arrangement entered into by subsidiaries of the Company.

(b)	Net of unamortized original issue discount and debt issuance costs of $0.2 million and $0.9 million as of December 31, 2022.

(c)	Net of unamortized debt issuance costs of $1.7 million as of September 30, 2023.

(d)	Net of unamortized original issue discount and debt issuance costs of $0.1 million and less than $0.1 million as of December 31, 2022.

(e)	Net of unamortized net original issue discount and debt issuance costs of $0.3 million and $1.0 million as of September 30, 2023, respectively; and unamortized net original issue discount and debt issuance costs of $58.8 million and $12.1 million as of December 31, 2022, respectively.

(f)	Net of unamortized net debt exchange premium of $131.7 million as of September 30, 2023.

(g)	Net of unamortized debt issuance costs of $4.6 million as of September 30, 2023.

Related-Party Transactions - Relationship with HandsOn Global Management (Details) $ in Thousands	3 Months Ended		9 Months Ended		12 Months Ended
	Sep. 30, 2023 USD ($)	Sep. 30, 2022 USD ($)	Sep. 30, 2023 USD ($) agreement	Sep. 30, 2022 USD ($)	Dec. 31, 2016
Related-Party Transactions
Amount of related party transaction	$ 2,845	$ 2,016	$ 8,696	$ 6,189
Related party expense	2,845	2,016	8,696	6,189
HGM \| Travel Expense
Related-Party Transactions
Amount of related party transaction	0
HGM \| Travel Expense \| Maximum
Related-Party Transactions
Amount of related party transaction		100	$ 100	100
HGM \| Master Service Agreement
Related-Party Transactions
Number of master agreements \| agreement			10
Entities affiliated with HGM managed funds \| Master Service Agreement
Related-Party Transactions
Revenue share percentage					25.00%
Affiliate of largest stockholder
Related-Party Transactions
Rental expenses		100	$ 100	200
Affiliate of largest stockholder \| Maximum
Related-Party Transactions
Rental expenses	100
HOV Services, Ltd \| Data Capture And Technology Services \| Cost of revenue
Related-Party Transactions
Amount of related party transaction	500	400	1,300	1,100
SourceHOV \| Master Service Agreement
Related-Party Transactions
Revenue share percentage					75.00%
SourceHOV \| Entities affiliated with HGM managed funds \| Master Service Agreement
Related-Party Transactions
Related party expense	$ 2,200	$ 1,500	$ 6,700	$ 4,600

Long-Term Debt and Credit Facilities - Senior Credit Facilities (Details) - USD ($) $ in Thousands					3 Months Ended		9 Months Ended
	Jul. 12, 2023	Jul. 11, 2023	Dec. 09, 2021	Jul. 13, 2018	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Dec. 31, 2019	Jul. 12, 2017
Long-Term Debt and Credit Facilities.
Outstanding debt					$ 1,091,996		$ 1,091,996		$ 1,096,837
Amount of cash payment							48,529	$ 59,209
Gain on early extinguishment of debt, net					571	$ 4,696	16,129	$ (4,305)
2026 notes
Long-Term Debt and Credit Facilities.
Principal amount											$ 1,000,000
Outstanding debt		$ 24,000			$ 0		$ 0		$ 980,000
Amount exchanged		$ 956,000	$ 662,700
Interest rate (in percent)					11.50%		11.50%
New 11.500% First-Priority Senior Secured Notes Due 2026
Long-Term Debt and Credit Facilities.
Interest rate (in percent)		11.50%
Amount of minimum unrestricted cash remaining after the interest payment		$ 15,000
2023 Term Loans
Long-Term Debt and Credit Facilities.
Principal amount											350,000
Original issue discount											7,000
Outstanding debt	$ 48,400
Amount exchanged			212,100
Amount exchanged for cash			84,300
Amount of cash payment	44,800
Gain on early extinguishment of debt, net					$ 600		$ 600
2023 Term Loans \| 2026 notes
Long-Term Debt and Credit Facilities.
Applicable margin rate				5.50%
2023 Term Loans \| New 11.500% First-Priority Senior Secured Notes Due 2026
Long-Term Debt and Credit Facilities.
Principal amount	$ 3,000
Interest rate (in percent)	11.50%
2023 Term Loans \| LIBOR
Long-Term Debt and Credit Facilities.
Floor interest rate (in percent)				1.00%
Adjustment rate on variable rate (in percent)				6.50%
2023 Term Loans \| Federal funds
Long-Term Debt and Credit Facilities.
Applicable margin rate				0.50%
2023 Term Loans \| Base rate \| New 11.500% First-Priority Senior Secured Notes Due 2026
Long-Term Debt and Credit Facilities.
Amount exchanged for Notes			$ 127,800
Interest rate (in percent)			11.50%
Repricing Term Loans
Long-Term Debt and Credit Facilities.
Outstanding debt				$ 343,400
2018 Incremental Term Loans
Long-Term Debt and Credit Facilities.
Amount borrowed				30,000
2019 Incremental Term Loans
Long-Term Debt and Credit Facilities.
Amount borrowed				$ 30,000
Senior secured revolving facility
Long-Term Debt and Credit Facilities.
Maximum borrowing capacity										$ 100,000	$ 100,000
Letters of credit outstanding										$ 500

Stock-Based Compensation - Market Performance Units (Details) - Market Performance Units - USD ($) $ / shares in Units, $ in Millions		3 Months Ended		9 Months Ended
	Sep. 14, 2021	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Fair value of the awards		$ 1,820.00		$ 1,820.00		$ 1,820.00
Unrecognized compensation expense		$ 1.1		$ 1.1
Compensation expense		$ 0.2	$ 0.2	$ 0.7	$ 0.7
Share Price (Equal to or Less than $8,000.00 per share)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage				0.00%
Share Price		$ 8,000		$ 8,000
Tranche 1
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	50.00%
Share Price	$ 40,000
Number of consecutive trading days	60 days
Number of non-consecutive trading days	90 days
Number of trading days under arrangement	180 days
Fair value of the awards		5,920		5,920
Modification date fair value		1,760		1,760
Tranche 1 \| Minimum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share Price		8,000		8,000
Tranche 1 \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share Price		40,000		$ 40,000
Tranche 1 \| Share Price (Equal to or Greater than $40,000.00 per share)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage				100.00%
Share Price		40,000		$ 40,000
Tranche 2
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage	50.00%
Share Price	$ 80,000
Number of consecutive trading days	60 days
Number of non-consecutive trading days	90 days
Number of trading days under arrangement	180 days
Consideration for forfeited unearned shares				$ 0.0
Fair value of the awards		6,040		$ 6,040
Modification date fair value		1,880		1,880
Tranche 2 \| Maximum
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Share Price		80,000		$ 80,000
Tranche 2 \| Share Price (Equal to or Greater than $80,000.00 per share)
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Vesting percentage				100.00%
Share Price		$ 80,000		$ 80,000

Long-Term Debt and Credit Facilities - Senior Secured Term Loan (Details)	Jul. 11, 2023 USD ($) item	Dec. 09, 2023 USD ($)	Sep. 30, 2023	Jul. 12, 2017 USD ($)
Long-Term Debt and Credit Facilities.
Minimum business days elect to have interest on all or a portion of the loans be charged	3 days
Senior Secured Term Loan
Long-Term Debt and Credit Facilities.
Amount of facility	$ 40,000,000.0
Adjustment rate on variable rate (in percent)	1.00%
Interest rate (in percent)	10.39%
Number of business days prior to the first day of interest period considered for calculation of interest rate	2 days
Period considered for calculation of interest rate	3 months
Maximum number of loans in effect at any given time \| item	5
Minimum amount of loan may exercise	$ 500,000
Integral multiples of loan for exercise of loan	$ 100,000
Number of installments \| item	11
Monthly installments	$ 500,000
Outstanding borrowings under the facility	$ 34,500,000
Number of days prior to the earliest maturity considered for maturity	91 days
Senior Secured Term Loan \| Federal funds
Long-Term Debt and Credit Facilities.
Applicable margin rate	0.50%
Senior Secured Term Loan \| SOFR
Long-Term Debt and Credit Facilities.
Adjustment rate on variable rate (in percent)	0.26161%
Interest rate (in percent)	11.39%
Deemed rate, if rate less than 4.00%	4.00%
Reference Rate Loan
Long-Term Debt and Credit Facilities.
Applicable margin rate	4.00%
2023 notes
Long-Term Debt and Credit Facilities.
Interest rate (in percent)				10.00%
Outstanding balance of debt		$ 912,700,000
2026 notes
Long-Term Debt and Credit Facilities.
Amount of facility				$ 1,000,000,000.0
Interest rate (in percent)			11.50%

General

9 Months Ended

Sep. 30, 2023

General

General

1. General

These condensed consolidated financial statements should be read in conjunction with the notes to the consolidated financial statements as of and for the year ended December 31, 2022 included in the Exela Technologies, Inc. (the “Company,” “Exela,” “we,” “our” or “us”) annual report on Form 10-K for such period (as amended, the “2022 Form 10-K”), filed with the Securities and Exchange Commission (“SEC”) on April 3, 2023 and May 1, 2023 and available at the SEC’s website at http://www.sec.gov.

The accompanying condensed consolidated financial statements have been prepared using accounting principles generally accepted in the United States of America (“GAAP”) and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X under the Securities Act of 1933, as amended (the “Securities Act”), as they apply to interim financial information. Accordingly, they do not include all of the information and notes required by GAAP for complete financial statements. These accounting principles require us to use estimates and assumptions that impact the reported amounts of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results may differ from our estimates.

The condensed consolidated financial statements are unaudited, but in our opinion include all adjustments (consisting of normal recurring adjustments) necessary for a fair statement of the results for the interim period. The interim financial results are not necessarily indicative of results that may be expected for any other interim period or the fiscal year.

On May 12, 2023, we effected a one-for-two hundred reverse stock split (the “Reverse Stock Split”) of our issued and outstanding shares of common stock, par value $0.0001 per share (“Common Stock”). As a result of the Reverse Stock Split, every two hundred (200) shares of Common Stock issued and outstanding were automatically combined into one (1) share of issued and outstanding Common Stock, without any change in the par value per share. All information related to Common Stock, stock options, restricted stock units, warrants and earnings per share have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented.

Going Concern

In accordance with ASC Subtopic 205-40, Presentation of Financial Statements—Going Concern (“ASC 205-40”), the Company has the responsibility to evaluate whether conditions and/or events raise substantial doubt about its ability to meet its obligations as they become due within one year after the date that the financial statements are issued. As required under ASC 205-40, management’s evaluation should initially not take into consideration the potential mitigating effects of management’s plans that have not been fully implemented as of the date the financial statements are issued. The accompanying financial statements have been prepared assuming that the Company will continue as a going concern.

In performing this evaluation, the Company concluded that under the standards of ASC 205-40 the following conditions raised substantial doubt about its ability to continue as a going concern:

●

history of net losses, including net losses of $99.4 million for the nine months ended September 30, 2023;

●

net operating cash outflow of $29.2 million for the nine months ended September 30, 2023;

●

working capital deficit of $195.4 million as of September 30, 2023; and

●

an accumulated deficit of $2,058.4 million as of September 30, 2023.

The Company has undertaken and/or completed the following plans and actions to improve its available cash balances, liquidity or cash generated from operations:

●

identified and in the process of executing on significant cost savings for fiscal year 2024;

●

issued approximately $764.8 million aggregate principal amount of New Notes (as defined in Note 5 – Long-Term Debt and Credit Facilities) in exchange for $956.0 million aggregate principal amount of existing 2026 Notes that provide flexibility to pay up to 50% of the interest payments in 2024 in New Notes.

●

executed a $40.0 million financing agreement with certain lenders with Blue Torch Finance LLC acting as an administrative agent and used proceeds to repay existing debt;

●

fully discharged $48.4 million of outstanding principal amount of 2023 Term Loans by issuing $3.0 million aggregate principal amount of New Notes and making cash payment of $44.8 million resulting in a debt extinguishment gain of $0.6 million;

●

fully repaid $9.0 million of outstanding principal amount of 2023 Notes in cash (see Note 5 – Long-Term Debt and Credit Facilities); and

●

completed the merger of its European business with CFFE on November 29, 2023 (see Note 14 – Subsequent Events for further details).

In addition to these actions, management has reviewed the Company's operational plans which include executing on price increases, projected growth of margins and cost containment activities. The Company will have to continue to restore positive operating cash flows and profitability over the next twelve months and otherwise execute its business plan. The Company believes that the effective execution of management’s plans, as described above, will provide sufficient liquidity to meet its financial obligations and allievate substantial doubt. However, there can be no assurance that it will be successful in continuing to restore positive cash flows, or that it can raise additional financing when needed, and obtain it on terms acceptable or favorable to the Company. These factors and the execution risk currently raise substantial doubt about our ability to continue as a going concern for at least twelve months from the date that the financial statements were issued.

The Company’s plans to further enhance liquidity include the potential sale of certain non-core assets that are not central to the Company’s long-term strategic vision, and any potential action with respect to these operations would be intended to allow the Company to better focus on its core businesses. The Company has retained financial advisors to assist with the sale of select assets. The Company expects to use the potential net proceeds from this initiative for the pay down of debt. These plans are subject to inherent risks and uncertainties and subject to several factors, including market and economic conditions that are outside of the Company’s control. Accordingly, there can be no assurance that these plans can be effectively implemented and, therefore, that the conditions can be effectively mitigated.

Net Loss per Share

Earnings per share (“EPS”) is computed by dividing net loss attributable to common stockholders by the weighted average number of shares of common stock outstanding during the period, excluding the effects of any potentially dilutive securities. Diluted EPS gives effect to the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock, using the more dilutive of the two-class method and the if-converted method in the period of earnings. The two class method is an earnings allocation method that determines earnings per share (when there are earnings) for common stock and participating securities. The if-converted method assumes all convertible securities are converted into common stock. Diluted EPS excludes all dilutive potential shares of common stock if their effect is anti-dilutive.

As the Company experienced net losses for the periods presented, the impact of the Company’s Series A Perpetual Convertible Preferred Stock (“Series A Preferred Stock”) and Series B Cumulative Convertible Perpetual Preferred Stock (the “Series B Preferred Stock”), was calculated using the if-converted method. As of September 30, 2023, the outstanding shares of the Company’s Series A Preferred Stock and Series B Preferred Stock, if converted would have resulted in an additional 393 shares and 16,079 shares of our Common Stock outstanding, respectively, however, they were not included in the computation of diluted loss per share as their effects were anti-dilutive (i.e., if included, would reduce the net loss per share).

Similarly, the Company also did not include the effect of 2,433 shares of Common Stock issuable upon exercise of 9,731,819 warrants sold in a private placement of securities on March 18, 2021 or the effect of the aggregate number

of shares issuable pursuant to outstanding restricted stock units, performance units and options (2,471 and 2,486 as of September 30, 2023 and 2022, respectively) in the calculation of diluted loss per share for the three and nine months ended September 30, 2023 and 2022, because their effects were also anti-dilutive.


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Net loss attributable to common stockholders (A)	$	(25,298)	$	(87,326)	$	(105,865)	$	(226,613)
Weighted average common shares outstanding – basic and diluted (B)		6,365,353		315,725		5,854,840		176,875
Loss Per Share:
Basic and diluted (A/B)	$	(3.97)	$	(276.59)	$	(18.08)	$	(1,281.20)

Merger Agreement

On October 9, 2022, the Company entered into a definitive merger agreement to merge its European business with CF Acquisition Corp. VIII (“CFFE”), a special purpose acquisition company, to form a new publicly-traded company which will be called XBP Europe, Inc. (“XBP Europe”). Following the closing of the transaction, which occurred on November 29, 2023, the Company indirectly owns a majority of the outstanding capital stock of XBP Europe. The effects of these transactions are not reflected in these condensed consolidated financial statements (see Note 14 – Subsequent Events for further details).

Sale of Non-core Assets

On June 8, 2023, the Company completed the sale of its high-speed scanner business, which was a part of its ITPS segment (as defined in Note 3 – Significant Accounting Policies), for a purchase price of approximately $30.1 million, subject to final working capital adjustments. The sale of the high-speed scanner business does not represent a strategic shift that will have a major effect on the Company’s operations and financial results. As a result of this transaction, the Company disposed of $16.5 million of goodwill based on the relative fair value of the high-speed scanner business to the total fair value of the ITPS reporting unit. This transaction resulted in a total pre-tax gain of $7.2 million included in selling, general and administrative expenses (exclusive of depreciation and amortization) in the condensed consolidated statements of operations for the nine months ended September 30, 2023. Per the terms of the sales agreement, the Company may receive additional cash consideration (“Contingent Consideration”) upon the future occurrence of certain earn out events described in the sales agreement. The Contingent Consideration, if any, will be recognized in the period the earn out event occurs, and the Contingent Consideration is realizable.

Long-Term Debt and Credit Facilities - Repurchases (Details) - USD ($) $ in Thousands		3 Months Ended		9 Months Ended		12 Months Ended
	Mar. 07, 2022	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022
Net cash consideration				$ 11,858	$ 4,712
Gain on early extinguishment of debt, net		$ 571	$ 4,696	16,129	(4,305)
Revolving Loan Exchange and Prepayment Agreement
Debt issuance costs	$ 200
2023 Term Loans
Repurchase of principal amount		15,100		15,100
Net cash consideration				8,000
Gain on early extinguishment of debt, net				7,100
2023 Term Loans \| Maximum
Debt issuance costs				100
Exchange Notes
Repurchase of principal amount						$ 15,000
Net cash consideration						$ 4,700
Gain on early extinguishment of debt, net			5,300		5,300
Write off of original issue discount			5,000		5,000
Debt issuance costs			$ 100		$ 100
2023 notes
Repurchase of principal amount		13,800		13,800
Net cash consideration				4,400
Gain on early extinguishment of debt, net				9,900
2023 notes \| Maximum
Debt issuance costs				100
2023 Term Loans
Gain on early extinguishment of debt, net		$ 600		$ 600

Related-Party Transactions - Payable and Receivable/Prepayment Balances with Affiliates (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Dec. 31, 2022
Payable and Receivable Balances with Affiliates
Receivables and Prepaid Expenses	$ 117	$ 759
Payables	2,499	2,473
HOV Services, Ltd
Payable and Receivable Balances with Affiliates
Receivables and Prepaid Expenses	50	412
Rule 14
Payable and Receivable Balances with Affiliates
Payables	2,499	2,473
HGM
Payable and Receivable Balances with Affiliates
Receivables and Prepaid Expenses	$ 67	$ 347

Commitments and Contingencies (Details) $ / shares in Units, € in Millions, $ in Millions				1 Months Ended
	Jul. 23, 2023 USD ($)	May 28, 2021 USD ($)	Mar. 23, 2020 claim $ / shares shares	Nov. 30, 2020 USD ($)	Sep. 30, 2020 EUR (€)	Sep. 30, 2023 USD ($)
Commitments and Contingencies
Number of claims \| claim			2
The plaintiff (Bo Shen)
Commitments and Contingencies
Number of shares owned \| shares			4,000
Argued fair value per share \| $ / shares			$ 1.34
Amount paid towards judgement	$ 5.0
Adverse Arbitration Order
Commitments and Contingencies
Accrued liability						$ 0.9
Amount awarded to customer				$ 13.0
Amount paid towards judgement		$ 8.8
Earnout sought \| €					€ 10.0

Significant Accounting Policies - Performance Obligations (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Significant Accounting Policies
Contracts with an original expected length	true
Remainder of 2023	$ 10,169
2024	35,699
2025	30,338
2026	3,663
2027	2,041
2028 and thereafter	1,226
Total	$ 83,136

Stockholders' Equity

9 Months Ended

Sep. 30, 2023

Stockholders' Equity

Stockholders' Equity

11. Stockholders’ Equity

The following description summarizes the material terms and provisions of the securities that the Company has authorized.

Common Stock

The Company is authorized to issue 1,600,000,000 shares of Common Stock. Except as otherwise required by law or as otherwise provided in any certificate of designation for any series of preferred stock, the holders of our Common Stock and Tandem Preferred Stock (that provides a vote to holders of our Series B Preferred Stock, as described below) possess all voting power for the election of the Board and all other matters requiring stockholder action and will at all times vote together as one class on all matters submitted to a vote of Exela stockholders. Holders of our Common Stock are entitled to one vote per share on matters to be voted on by stockholders. Holders of our Common Stock will be entitled to receive such dividends and other distributions, if any, as may be declared from time to time by the Board in its discretion out of funds legally available therefor and shall share equally on a per share basis in such dividends and distributions. The holders of the Common Stock have no conversion, preemptive or other subscription rights and there are no sinking fund or redemption provisions applicable to the Common Stock. As of September 30, 2023 and December 31, 2022, there were 6,365,353 and 1,393,276 shares of Common Stock outstanding, respectively.

Reverse Stock Split

On May 12, 2023, we effected the Reverse Stock Split of our issued and outstanding shares of Common Stock. As a result of the Reverse Stock Split every two hundred (200) shares of Common Stock issued and outstanding were automatically combined into one (1) share of issued and outstanding Common Stock, without any change in the par value per share. All information related to Common Stock, stock options, restricted stock units, warrants and earnings per share have been retroactively adjusted to give effect to the Reverse Stock Split for all periods presented.

Giving effect to the Reverse Stock Split issued and outstanding Common Stock decreased from 278,655,235 to 1,393,276 at December 31, 2022.

Common Stock At-The-Market Sales Program

On May 27, 2021, the Company entered into an At Market Issuance Sales Agreement (“First ATM Agreement”) with B. Riley Securities, Inc. (“B. Riley”) and Cantor Fitzgerald & Co. (“Cantor”), as distribution agents, under which the Company may offer and sell shares of the Common Stock from time to time through the Distribution Agents, acting as sales agent or principal. On September 30, 2021, the Company entered into a second At Market Issuance Sales Agreement with B. Riley, BNP Paribas Securities Corp., Cantor, Mizuho Securities USA LLC and Needham & Company, LLC, as distribution agents (together with the First ATM Agreement, the “ATM Agreement”).

Sales of the shares of Common Stock under the ATM Agreement have been in “at the market offerings” as defined in Rule 415 under the Securities Act, including, without limitation, sales made directly on or through the Nasdaq or on any other existing trading market for the Common Stock, as applicable, or to or through a market maker or any other method permitted by law, including, without limitation, negotiated transactions and block trades. Shares of Common Stock sold under the ATM Agreement have been offered pursuant to the Company’s Registration Statement on Form S-3 (File No. 333-255707), filed with the SEC on May 3, 2021 and declared effective on May 12, 2021, and the Company’s Registration Statement on Form S-3 (File No. 333-263909), filed with the SEC on March 28, 2022 and declared effective on May 10, 2022, and the prospectuses and related prospectus supplements included therein for sales of shares of Common Stock as follows:


Supplement	Period	Number of Shares Sold	Weighted Average Price Per Share	Gross Proceeds	Net Proceeds
Prospectus supplement dated May 27, 2021 with an aggregate offering price of up to $100.0 million (“Common ATM Program–1”)	May 28, 2021 through July 1, 2021	12,356	$8,032.74	$99.3 million	$95.7 million
Prospectus supplement dated June 30, 2021 with an aggregate offering price of up to $150.0 million (“Common ATM Program–2”)	June 30, 2021 through September 2, 2021	14,395	$10,413.79	$149.9 million	$144.4 million
Prospectus supplement dated September 30, 2021 with an aggregate offering price of up to $250.0 million (“Common ATM Program–3”)	October 6, 2021 through March 31, 2022	83,719	$2,986.18	$250.0 million	$241.0 million
Prospectus supplement dated May 23, 2022 with an aggregate offering price of up to $250.0 million (“Common ATM Program–4”)	May 24, 2022 through March 31, 2023	6,262,182	$36.15	$226.4 million	$219.3 million

Due to the late filing of the 2022 Form 10-K, the Company lost eligibility to use Form S-3 (and thereby the ability to conduct at the market offerings). As a result of subsequent delinquent quarterly reports on Form 10-Q, including for the period ended September 30, 2023 (the “Q3 Form 10-Q”), the Company will not regain eligibility to use Form S-3 until twelve full calendar months following the date the Q3 Form 10-Q was due. Any future delinquency with respect to the filing of a Form 10-K, Form 10-Q, or certain Form 8-Ks will cause the Company to lose Form S-3 eligibility for at least 12 calendar months from the due date of the delinquent filing.

Share Buyback Program

On August 10, 2022, the Board authorized a share buyback program (the “2022 Share Buyback Program”), pursuant to which the Company is permitted to repurchase up to 50,000 shares of Common Stock over the next two-year period. The 2022 Share Buyback Program does not obligate the Company to repurchase any shares of Common Stock. No shares were repurchased under the 2022 Share Buyback Program during the nine months ended September 30, 2023. As of September 30, 2023, we had repurchased and concurrently retired a total of 1,787 shares of Common Stock pursuant to the 2022 Share Buyback Program.

The Company records such stock repurchases as a reduction to stockholders’ equity. The Company allocates the excess of the repurchase price over the par value of shares acquired to accumulated deficit and additional paid-in

capital. The portion allocated to additional paid-in capital is determined by dividing the number of shares to be retired by the number of shares issued multiplied by the balance of additional paid-in capital as of the retirement date.

Series A Preferred Stock

The Company is authorized to issue 20,000,000 shares of preferred stock with such designations, voting and other rights and preferences as may be determined from time to time by the Board. The Company has designated 2,800,000 shares of its authorized preferred stock as Series A Preferred Stock. At September 30, 2023 and December 31, 2022, the Company had 2,778,111 shares of Series A Preferred Stock outstanding. The par value of the Series A Preferred Stock is $0.0001 per share. Each share of Series A Preferred Stock is convertible at the holder’s option, at any time into the number of shares of Common Stock determined as of the date of conversion using a certain conversion formula that takes into account the amount of Liquidation Preference per share as adjusted for accrued but unpaid dividends, as described below. As of September 30, 2023, after taking into account the effect of the Reverse Stock Split, each outstanding share of Series A Preferred Stock was convertible into 0.00014 shares of Common Stock using this conversion formula. Accordingly, as of September 30, 2023, 393 shares of Common Stock were issuable upon conversion of 2,778,111 shares of outstanding Series A Preferred Stock.

Holders of the Series A Preferred Stock are entitled to receive cumulative dividends at a rate per annum of 10% of the dollar amount of per share liquidation preference (plus accumulated but unpaid dividends, the “Series A Liquidation Preference”) per share of Series A Preferred Stock, paid or accrued quarterly in arrears on the 15^th day of each March, June, September and December. From the issue date through September 30, 2023, the amount of all accrued but unpaid dividends on the Series A Preferred Stock have been added to the Series A Liquidation Preference. The Company shall add the amount of all accrued but unpaid dividends on each quarterly dividend payment date to the Series A Liquidation Preference, except to the extent the Company elects to make all or any portion of such payment in cash on or prior to the applicable dividend payment date, in which case, the amount of the accrued but unpaid dividends that is added to the Series A Liquidation Preference shall be reduced on a dollar-for-dollar basis by the amount of any such cash payment. The Company is not required to make any payment or allowance for unpaid dividends, whether or not in arrears, on converted shares of Series A Preferred Stock or for dividends on the shares of Common Stock issued upon conversion of such shares. The gross dividend accumulation for the three and nine months ended September 30, 2023 was $1.0 million and $2.9 million, respectively. The gross dividend accumulation for the three and nine months ended September 30, 2022 was $0.9 million and $2.6 million, respectively. As of September 30, 2023, the total accumulated but unpaid dividends on the Series A Preferred Stock since inception on July 12, 2017 was $18.8 million. The per share average of cumulative preferred dividends for the three and nine months ended September 30, 2023 was $0.36 and $1.05, respectively. The per share average of cumulative preferred dividends for the three and nine months ended September 30, 2022 was $0.33 and $0.95, respectively.

In addition, holders of the Series A Preferred Stock will participate in any dividend or distribution of cash or other property paid in respect of the Common Stock pro rata with the holders of the Common Stock (other than certain dividends or distributions that trigger an adjustment to the conversion rate, as described in the Certificate of Designations), as if all shares of Series A Preferred Stock had been converted into Common Stock immediately prior to the date on which such holders of the Common Stock became entitled to such dividend or distribution.

Series B Preferred Stock and Tandem Preferred Stock

The Company has designated 8,100,000 shares of its authorized and unissued preferred stock as Series B Preferred Stock. At September 30, 2023 and December 31, 2022, the Company had 3,029,900 shares of Series B Preferred Stock outstanding. The par value of the Series B Preferred Stock is $0.0001 per share. Each share of Series B Preferred Stock is convertible at the holder’s option, at any time into the number of shares of Common Stock determined as of the date of conversion using a certain conversion formula that takes into account the amount of liquidation preference per share as adjusted for accrued but unpaid dividends, as described below. As of September 30, 2023, after taking into account the effect of the Reverse Stock Split and payment of the accrued dividend, each outstanding share of Series B Preferred Stock was convertible into 0.00531 of one share of Common Stock using this conversion formula. Accordingly, as of September 30, 2023, 16,079 shares of Common Stock were issuable upon conversion of 3,029,900

shares of outstanding Series B Preferred Stock. The shares of Series B Preferred Stock are listed on the Nasdaq under the symbol “XELAP.”

Holders of the Series B Preferred Stock are entitled to receive cumulative dividends at a rate per annum of 6% of the dollar amount of per share liquidation preference (plus accumulated but unpaid dividends, the “Series B Liquidation Preference”) per share of Series B Preferred Stock, paid or accrued quarterly in arrears on the last day of each of March, June, September and December. The Company shall add the amount of all accrued but unpaid dividends on each quarterly dividend payment date to the Series B Liquidation Preference, except to the extent the Company elects to make all or any portion of such payment in cash on or prior to the applicable dividend payment date, in which case, the amount of the accrued but unpaid dividends that is added to the Series B Liquidation Preference shall be reduced on a dollar-for-dollar basis by the amount of any such cash payment. The Company is not required to make any payment or allowance for unpaid dividends, whether or not in arrears, on converted shares of Series B Preferred Stock or for dividends on the shares of Common Stock issued upon conversion of such shares. The gross dividend accrued for the three and nine months ended September 30, 2023 was $1.2 million and $3.5 million, respectively. The gross dividend accrued for the three and nine months ended September 30, 2022 was $1.1 million and $2.5 million, respectively. During the nine months ended September 30, 2022, the Company paid accumulated dividend of $2.5 million. As of September 30, 2023, the total accumulated but unpaid dividends on the Series B Preferred Stock since inception on March 23, 2022 was $4.6 million. The per share average of accrued preferred dividends for the three and nine months ended September 30, 2023 was $0.39 and $1.16, respectively. The per share average of accrued preferred dividends for the three and nine months ended September 30, 2022 was $0.38 and $0.83, respectively.

In addition, holders of the Series B Preferred Stock will participate in any dividend or distribution of cash or other property paid in respect of the Common Stock pro rata with the holders of the Common Stock (other than certain dividends or distributions that trigger an adjustment to the conversion rate, as described in the Certificate of Designations), as if all shares of Series B Preferred Stock had been converted into Common Stock immediately prior to the date on which such holders of the Common Stock became entitled to such dividend or distribution. Holders of Series B Preferred Stock also have rights to vote for the election of one additional director to serve on the Board, if dividends on Series B Preferred Stock are in arrears for eight or more consecutive quarters, until all unpaid and accumulated dividends on the Series B Preferred Stock have been paid or declared and a sum sufficient for payment is set aside for such payment.

On May 17, 2022, the Company issued one share of tandem preferred stock, par value $0.0001 per share (the “Tandem Preferred Stock”), as a dividend on its existing shares of outstanding Series B Preferred Stock. Any issuance of Series B Preferred Stock after this date shall be automatically accompanied by an equal number of shares of Tandem Preferred Stock. Tandem Preferred Stock are embedded in the Series B Preferred Stock and they provide voting rights to the existing shares of Series B Preferred Stock. Each share of Series B Preferred Stock disclosed in the condensed consolidated balance sheet, the condensed consolidated statements of stockholders’ deficit and the notes to the condensed consolidated financial statements embeds one share of Tandem Preferred Stock.

On all matters submitted to a vote of the stockholders of the Company, the holders of the Series B Preferred Stock through their holdings of Tandem Preferred Stock will be entitled to vote with the holders of the Common Stock as a single class. Each share of Tandem Preferred Stock entitles the holder to one vote per share, subject to adjustment for issuance of any shares of Common Stock pursuant to any dividend or distribution on shares of Common Stock, share split or share combination or other transactions as specified in the Certificate of Designation of Tandem Preferred Stock.

Shares of Tandem Preferred Stock are not entitled to receive dividends of any kind. In the case of a transfer of the underlying Series B Preferred Stock by a holder to any transferee, the Tandem Preferred Stock shall be automatically transferred simultaneously to such transferee without any further action by such Holder. Upon the redemption of a holder’s shares of Series B Preferred Stock or the conversion of shares of Series B Preferred Stock into Common Stock, an equal number of such holder’s shares of Tandem Preferred Stock shall, without any further action required by the holder, be automatically transferred to the Company for cancellation without the payment of any additional consideration by the Company. In the event of any liquidation, winding-up or dissolution of the Company each holder of the Tandem Preferred Stock shall be entitled to receive and to be paid out of the assets of the Company available for

distribution to its stockholders an amount in cash equal to the par value of such Tandem Preferred Stock with respect to each share of Tandem Preferred Stock held by such holder.

Treasury Stock

The Company had 612 shares of Common Stock held as treasury stock, 232 shares of which were repurchased under a prior expired share buyback and 380 shares that were returned to the Company pursuant to a contractual obligation. The Company recorded treasury stock using the cost method. On September 30, 2023, the Company retired all of 612 shares of the Common Stock held as treasury stock and charged the excess of the repurchase cost over the par value of the shares to accumulated deficit.

Warrants

At September 30, 2023, there were warrants outstanding to purchase 2,433 shares of our Common Stock, consisting of 9,731,819 warrants to purchase one-four thousandth of one share of Common Stock from the private placement that was completed in March 2021.

Private Placement of Unregistered Shares and Warrants

On March 15, 2021, the Company, entered into a securities purchase agreement with certain accredited institutional investors pursuant to which the Company issued and sold to ten accredited institutional investors in a private placement an aggregate of 2,433 unregistered shares of the Common Stock at a price of $11,000.00 per share and an equal number of warrants, generating gross proceeds to the Company of $26.8 million. Cantor Fitzgerald acted as placement agent in connection with such sale of unregistered securities and received a placement fee of 5.5% of gross proceeds in connection with such service. In selling the shares without registration, the Company relied on exemptions from registration available under Section 4(a)(2) of the Securities Act and Rule 506 promulgated thereunder. The Company filed a registration statement on Form S-3 on May 3, 2021 that registered for resale of these shares and the shares underlying these private placement warrants.

Each private placement warrant entitles the holder to purchase one-four thousandth of one share of Common Stock, at an exercise price of $16,000.00 per share and will expire on September 19, 2026. The private placement warrants are not listed or traded as of September 30, 2023, and are not subject to mandatory redemption by the Company.

- Definition

The entire disclosure for shareholders' equity comprised of portions attributable to the parent entity and noncontrolling interest, including other comprehensive income. Includes, but is not limited to, balances of common stock, preferred stock, additional paid-in capital, other capital and retained earnings, accumulated balance for each classification of other comprehensive income and amount of comprehensive income.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-URI https://asc.fasb.org/topic&trid=2208762

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496171-112644

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496171-112644

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI https://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 14
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496171-112644

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496189-112644

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 16
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496180-112644

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 13
-Subparagraph (i)
-URI https://asc.fasb.org/extlink&oid=126973232&loc=SL123496158-112644

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(e)(1))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 50
-Paragraph 6
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126731327&loc=SL126733271-114008

+ Details

Stock-Based Compensation

9 Months Ended

Sep. 30, 2023

Stock-Based Compensation

Stock-Based Compensation

10. Stock-Based Compensation

Exela 2018 Stock Incentive Plan

On January 17, 2018, Exela’s 2018 Stock Incentive Plan (the “2018 Plan”) became effective. The 2018 Plan provides for the grant of incentive and nonqualified stock options, restricted stock, restricted stock units, stock appreciation rights, performance awards, and other stock-based compensation to eligible participants. The Company was initially authorized to issue up to 694 shares of Common Stock under the 2018 Plan. On June 27, 2022, the shareholders of the Company approved our Amended and Restated 2018 Stock Incentive Plan increasing the number of shares of Common Stock reserved for issuance from an original 694 shares to 4,462.

Restricted Stock Unit

Restricted stock unit awards generally vest ratably over a one to two year period. Restricted stock units are subject to forfeiture if employment or service terminates prior to vesting and are expensed ratably over the vesting period.

A summary of restricted stock unit activities under the 2018 Plan for the nine months ended September 30, 2023 is summarized in the following table:


				Average
		Weighted		Remaining
	Number	Average Grant		Contractual Life
	of Units	Date Fair Value		(Years)
Outstanding Balance as of December 31, 2022	8	$	6,600.00	1.00
Granted	—		—
Forfeited	—		—
Vested	—		—
Outstanding Balance as of September 30, 2023	8	$	6,600.00	0.25

Options

Under the 2018 Plan, stock options are granted at a price per share not less than 100% of the fair market value per share of the underlying stock at the grant date. The vesting period for each option award is established on the grant date, and the options generally expire 10 years from the grant date. Options granted under the 2018 Plan generally

require no less than a two or four year ratable vesting period. Stock option activity for the nine months ended September 30, 2023 is summarized in the following table:


						Average
		Weighted		Weighted		Remaining
		Average Grant		Average		Vesting Period
	Outstanding	Date Fair Value		Exercise Price		(Years)
Outstanding Balance as of December 31, 2022	352	$	22,554.25	$	47,117.77	0.20
Granted	—		—
Exercised	—		—
Forfeited	(14)		27,703.04
Expired	—		—
Outstanding Balance as of September 30, 2023 (1)	338	$	22,347.33	$	46,554.52	0.03

(1) 329 of the outstanding options are exercisable as of September 30, 2023.

As of September 30, 2023, there was approximately less than $0.1 million of total unrecognized compensation expense related to non-vested restricted stock unit awards and stock option awards under the 2018 Plan, which will be recognized over the respective service period. Stock-based compensation expense is recorded within selling, general and administrative expenses. The Company recorded compensation expense of less than $0.1 million and net reversal of compensation expense of $0.1 million related to restricted stock unit awards and stock option awards under the 2018 Plan for the three and nine months ended September 30, 2023, respectively, due to forfeiture of options. The Company incurred total compensation expense of $0.2 million and $0.6 million related to restricted stock unit awards and stock option awards under the 2018 Plan for the three and nine months ended September 30, 2022, respectively.

Market Performance Units

On September 14, 2021, the Company granted its Executive Chairman performance units with a market performance condition, which are notional units representing the right to receive one share of Common Stock (or the cash value of one share of Common Stock). At the election of the compensation committee of the Company, these performance units might be settled in cash or in shares of Common Stock.

Fifty percent of the performance units covered by the award will vest if, at any time during the period commencing September 14, 2021 and ending June 30, 2024, the volume weighted average of the reported closing price of the Common Stock is $40,000 per share or greater on (x) 60 consecutive trading days or (y) 90 non-consecutive trading days in any 180 day period (the “Tranche 1”). In addition, the remaining 50% of the performance units will vest if, at any time during the period commencing September 14, 2021 and ending June 30, 2025, the volume weighted average of the reported closing prices of the Common Stock is $80,000 per share or greater on (x) 60 consecutive trading days or (y) 90 non-consecutive trading days in any 180 day period (the “Tranche 2”). Any Tranche 1 and Tranche 2 units that are not earned by June 30, 2024 and June 30, 2025, respectively, will be forfeited for no consideration and will no longer be eligible to vest. In addition, if a change in control occurs prior to the applicable expiration date, if the performance units are assumed by the acquirer, the units will remain outstanding and eligible to vest based solely on his continued service to the Company. If in connection with such change in control the performance units are not assumed by an acquirer, a number of performance units will vest based on the per share price paid in the transaction, with 0% vesting if the per share price is equal to or less than $8,000 per share, and 100% of the Tranche 1 vesting if the per share price is equal to or greater than $40,000 and 100% of the Tranche 2 vesting if the per share price is equal to or greater than $80,000, and a number of Tranche 1 and Tranche 2 vesting determined based on a straight line interpolation if the share price is between $8,000 and $40,000 or $80,000, respectively. In addition, if there is a change in control that is principally negotiated and approved by, and recommended to the Company’s shareholders by, a special committee of independent directors which committee does not include the Executive Chairman, and neither he nor any of his affiliates is directly or indirectly an equity holder of the acquiring Company, and the Tranche 1 are not assumed by an acquirer in connection with such transaction, all of his then unvested Tranche 1 will vest, and the Tranche 2 would be eligible for the pro rata vesting described above. The Executive Chairman will remain eligible to earn his performance units so long as he remains engaged with the Company in any capacity, including as a non-employee director.

The fair value per unit of the awards was determined to be $5,920 and $6,040 for Tranche 1 and Tranche 2, respectively, on the grant date by application of the Monte Carlo simulation model. On December 31, 2021, the

modification date fair value per unit of the awards was determined to be $1,760 and $1,880 for Tranche 1 and Tranche 2, respectively, by application of the Monte Carlo simulation model.

The following table summarizes the activity for the market performance restricted stock units for the nine months ended September 30, 2023:


				Weighted Average
		Weighted		Period Over
	Number	Average		Which Expected
	of Units	Fair Value		to be Recognized
Outstanding Balance as of December 31, 2022	2,125	$	1,820.00	2.98
Granted	—		—
Forfeited	—		—
Vested	—		—
Outstanding Balance as of September 30, 2023	2,125	$	1,820.00	2.98

As of September 30, 2023, there was approximately $1.1 million of total unrecognized compensation expense related to non-vested performance unit awards, which will be recognized over the requisite service period. We recognized $0.2 million and $0.7 million compensation expense associated with the performance unit award for the three and nine months ended September 30, 2023, respectively, and $0.2 million and $0.7 million for the three and nine months ended September 30, 2022, respectively.

Long-Term Debt and Credit Facilities (Tables)

9 Months Ended

Sep. 30, 2023

Long-Term Debt and Credit Facilities

Schedule of outstanding long-term debt instruments



	September 30,		December 31,
	2023		2022
Other (a)	$	34,561	$	25,117
2023 term loans (b)		—		71,470
Senior secured term loan maturing July 11, 2026 (c)		38,264		—
2023 notes (d)		—		22,762
2026 notes maturing July 12, 2026 (e)		22,693		908,959
New notes maturing April 15, 2026 (f)		943,642		—
Secured borrowings under BRCC Facility matured on June 10, 2023		25,899		68,529
Second lien note maturing June 17, 2025 (g)		26,937		—
Total debt		1,091,996		1,096,837
Less: Current portion of long-term debt		(48,221)		(154,802)
Long-term debt, net of current maturities	$	1,043,775	$	942,035

(a)	Other debt represents outstanding loan balances associated with various hardware, software purchases, maintenance and leasehold improvements along with loans and receivables factoring arrangement entered into by subsidiaries of the Company.

(b)	Net of unamortized original issue discount and debt issuance costs of $0.2 million and $0.9 million as of December 31, 2022.

(c)	Net of unamortized debt issuance costs of $1.7 million as of September 30, 2023.

(d)	Net of unamortized original issue discount and debt issuance costs of $0.1 million and less than $0.1 million as of December 31, 2022.

(e)	Net of unamortized net original issue discount and debt issuance costs of $0.3 million and $1.0 million as of September 30, 2023, respectively; and unamortized net original issue discount and debt issuance costs of $58.8 million and $12.1 million as of December 31, 2022, respectively.

(f)	Net of unamortized net debt exchange premium of $131.7 million as of September 30, 2023.

(g)	Net of unamortized debt issuance costs of $4.6 million as of September 30, 2023.

- Definition

Tabular disclosure of long-debt instruments or arrangements, including identification, terms, features, collateral requirements and other information necessary to a fair presentation. These are debt arrangements that originally required repayment more than twelve months after issuance or greater than the normal operating cycle of the entity, if longer.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02.22)
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 3
-Subparagraph (SX 210.12-04(a))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e24072-122690

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 1A
-URI https://asc.fasb.org/extlink&oid=124435984&loc=d3e28541-108399

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21506-112644

Reference 5: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 55
-Paragraph 69B
-URI https://asc.fasb.org/extlink&oid=123466577&loc=SL123495735-112612

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 45
-Paragraph 2
-URI https://asc.fasb.org/extlink&oid=124435984&loc=d3e28551-108399

Reference 7: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 20
-Section 55
-Paragraph 69E
-URI https://asc.fasb.org/extlink&oid=123466577&loc=SL123495743-112612

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21521-112644

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21538-112644

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 470
-Section 50
-Paragraph 3
-URI https://asc.fasb.org/extlink&oid=123599511&loc=d3e64711-112823

Reference 11: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 835
-SubTopic 30
-Section 55
-Paragraph 8
-URI https://asc.fasb.org/extlink&oid=114775985&loc=d3e28878-108400

Reference 12: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21475-112644

+ Details

Related-Party Transactions (Tables)

9 Months Ended

Sep. 30, 2023

Related-Party Transactions

Schedule of payable and receivable balances with affiliates



	September 30, 2023				December 31, 2022
	Receivables and Prepaid Expenses		Payables		Receivables and Prepaid Expenses		Payables
HOV Services, Ltd	$	50	$	—	$	412	$	—
Rule 14		—		2,499		—		2,473
HGM		67		—		347		—
	$	117	$	2,499	$	759	$	2,473

Stockholders' Equity - Treasury Stock (Details) - shares	Sep. 30, 2023	Sep. 29, 2023	Dec. 31, 2022
Stockholders' Equity
Treasury Stock (in shares)	0	612	612
Shares repurchased (in shares)		232
Shares returned in connection with the Appraisal Action following repayment of Margin Loan (in shares)		380
Treasury stock, shares retired	612

General (Details) $ / shares in Units, $ in Thousands					3 Months Ended						9 Months Ended
General (Details) $ / shares in Units, $ in Thousands	Jul. 11, 2023 USD ($)	Jun. 08, 2023 USD ($)	May 12, 2023 $ / shares shares	Dec. 09, 2021 USD ($)	Sep. 30, 2023 USD ($) $ / shares	Jun. 30, 2023 USD ($)	Mar. 31, 2023 USD ($)	Sep. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)	Mar. 31, 2022 USD ($)	Sep. 30, 2023 USD ($) $ / shares	Sep. 30, 2022 USD ($)	Dec. 31, 2022 USD ($) $ / shares
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Reverse stock split			0.005
Common stock, par value (in dollars per share) \| $ / shares			$ 0.0001		$ 0.0001						$ 0.0001		$ 0.0001
Conversion of shares (in shares) \| shares			1
Net loss					$ 23,108	$ 30,886	$ 45,436	$ 85,282	$ 79,199	$ 56,956	$ 99,430	$ 221,437
Net operating cash outflow											29,220	$ 86,951
Working Capital Deficit					195,400						195,400
Accumulated deficit					$ 2,058,388						2,058,388		$ 1,948,009
High Speed Scanner Business \| Disposed of by sale not discontinued operations
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Purchase price		$ 30,100
Disposed of goodwill		$ 16,500
Pre-tax gain											$ 7,200
New Notes issued under the 2023 Exchange
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Percentage of interest paid in cash	50.00%
Debt instrument face amount exchanged	$ 764,800
2023 notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt instrument, repayment made in cash	9,000
Debt instrument face amount exchanged	3,000
2026 notes
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt instrument face amount exchanged	956,000			$ 662,700
Senior Term Loan
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Debt instrument, repayment made in cash	48,400
Senior Term Loan \| Blue Torch Finance LLC
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items]
Maximum borrowing capacity	$ 40,000

Stockholders' Equity - Share Buyback Program (Details) - shares			9 Months Ended
	Sep. 29, 2023	Aug. 10, 2022	Sep. 30, 2023
Share Buyback Program
Shares repurchased (in shares)	232
2022 Share Buyback Program
Share Buyback Program
Authorized amount (in shares)		50,000
Term of share buyback program		2 years
Shares repurchased (in shares)			0
Common Stock repurchased and retired (in shares)			1,787

New Accounting Pronouncements - Changes in the allowance for expected credit losses (Details) $ in Thousands	9 Months Ended
	Sep. 30, 2023 USD ($)
Changes in allowance for expected credit losses
Allowance for Doubtful Accounts Receivable, Current, Beginning Balance	$ 6,402
Change in the provision for expected credit losses for the period	(724)
Allowance for Doubtful Accounts Receivable, Current, Ending Balance	$ 5,678

Stock-Based Compensation - Stock Incentive Plan (Details) - shares	Sep. 30, 2023	Dec. 31, 2022	Jun. 27, 2022	Jan. 17, 2018
Exela 2018 Stock Incentive Plan
Common stock shares authorized	1,600,000,000	1,600,000,000
2018 Plan
Exela 2018 Stock Incentive Plan
Common stock shares authorized			4,462	694
2018 Plan \| Maximum
Exela 2018 Stock Incentive Plan
Common stock shares authorized				694

Subsequent Events

9 Months Ended

Sep. 30, 2023

Subsequent Events.

Subsequent Events

14. Subsequent Events

The Company has evaluated all events that occurred after the balance sheet date through the date when these condensed consolidated financial statements were issued to determine if they must be reported.

Special Voting Preferred Stock

On October 9, 2023, the Company entered into the Subscription, Voting and Redemption Agreement with GP-HGM LLC (“GP-HGM”), an entity controlled by our Executive Chairman, pursuant to which GP-HGM purchased 1,000,000 shares of a new class of preferred stock designated as “Special Voting Stock” for an aggregate purchase price of $100 and agreed to vote all of the shares of Special Voting Stock at the annual meeting of stockholders, scheduled for December 5, 2023 (the “Annual Meeting"), in proportion to the votes cast at the Annual Meeting. Each share of Special Voting Stock is entitled to 20,000 votes per share. The Company has further agreed to redeem the shares of Special Voting Stock for an aggregate price of $100 on the first business day following the date on which the voting on the Amendment to Series B Certificate of Designations Proposal has concluded.

At the Annual Meeting, stockholders will be asked to approve an amendment to the Certificate of Designations of the Company’s Series B Preferred Stock to allow the Company to have the ability to (a) pay dividends in shares of Common Stock, (b) pay less than all of the accrued dividends, and (c) pay dividends on any date designated by the Company’s board of directors for the payment of dividends.

Completion of the Merger

On November 29, 2023, the Company completed the merger of its European business with CFFE. The combined company now operates as XBP Europe and, beginning on November 30, 2023, XBP Europe shares started trading on the Nasdaq Stock Market under the ticker symbol “XBP” and its warrants started trading on the Nasdaq Stock Market under the ticker symbol “XBPEW”.

The business combination will be accounted for as a reverse capitalization in accordance with FASB’s ASC Topic 805, Business Combinations (“ASC 805”). Under this method of accounting, CFFE will be treated as the “acquired” company for financial reporting purposes with XBP Europe surviving as a direct wholly-owned subsidiary of CFFE.

Insurance Claim

The Company received an insurance claim settlement amount of $10.0 million in December 2023 under the business interruption claim filed for the cyber security incident which occurred during the second half of 2022.

Condensed Consolidated Statements of Comprehensive Loss (Unaudited) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Condensed Consolidated Statements of Comprehensive Loss (Unaudited)
Net loss	$ (23,108)	$ (85,282)	$ (99,430)	$ (221,437)
Other comprehensive income (loss), net of tax
Foreign currency translation adjustments	(3,165)	1,978	(3,369)	4,588
Unrealized pension actuarial gains (losses), net of tax	147	824	(58)	1,934
Total other comprehensive loss, net of tax	$ (26,126)	$ (82,480)	$ (102,857)	$ (214,915)

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 942
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.9-04(22))
-URI https://asc.fasb.org/extlink&oid=120399700&loc=SL114874048-224260

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 4
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22595-107794

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 944
-SubTopic 220
-Section S99
-Paragraph 1
-Subparagraph (SX 210.7-04(18))
-URI https://asc.fasb.org/extlink&oid=120400993&loc=SL114874131-224263

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 815
-SubTopic 40
-Section 65
-Paragraph 1
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=126732423&loc=SL123482106-238011

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 50
-Paragraph 6
-URI https://asc.fasb.org/extlink&oid=124431353&loc=SL124452729-227067

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(5))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section S99
-Paragraph 2
-Subparagraph (SX 210.5-03(20))
-URI https://asc.fasb.org/extlink&oid=126953954&loc=SL114868664-224227

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 230
-SubTopic 10
-Section 45
-Paragraph 28
-URI https://asc.fasb.org/extlink&oid=126954810&loc=d3e3602-108585

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 1
-Subparagraph (b)(2)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22499-107794

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iv))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(iii)(A))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(i))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(i))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 15: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 9
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22663-107794

Reference 16: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iv))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 17: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(4)(ii))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 18: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 825
-SubTopic 10
-Section 50
-Paragraph 28
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=123596393&loc=d3e14064-108612

Reference 19: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 3
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22583-107794

Reference 20: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.4-08(g)(1)(ii))
-URI https://asc.fasb.org/extlink&oid=120395691&loc=d3e23780-122690

Reference 21: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 260
-SubTopic 10
-Section 45
-Paragraph 60B
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126958026&loc=SL5780133-109256

Reference 22: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 323
-SubTopic 10
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=114001798&loc=d3e33918-111571

Reference 23: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 8
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22658-107794

Reference 24: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1A
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126968391&loc=SL7669619-108580

Reference 25: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 31
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599

Reference 26: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22694-107794

Reference 27: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 250
-SubTopic 10
-Section 50
-Paragraph 11
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=124431687&loc=d3e22694-107794

Reference 28: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 205
-SubTopic 20
-Section 50
-Paragraph 7
-URI https://asc.fasb.org/extlink&oid=109222650&loc=SL51721683-107760

Reference 29: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 220
-SubTopic 10
-Section 45
-Paragraph 1B
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126968391&loc=SL7669625-108580

Reference 30: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599

Reference 31: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1A
-Subparagraph (SX 210.13-01(a)(5))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442526-122756

Reference 32: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(B))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 33: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 470
-SubTopic 10
-Section S99
-Paragraph 1B
-Subparagraph (SX 210.13-02(a)(4)(iii)(A))
-URI https://asc.fasb.org/extlink&oid=126975872&loc=SL124442552-122756

Reference 34: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8906-108599

Reference 35: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

+ Details

Stockholders' Equity - Sales of Shares of Common Stock (Details) - USD ($) $ / shares in Units, $ in Thousands	3 Months Ended				9 Months Ended
	Mar. 31, 2023	Sep. 30, 2022	Jun. 30, 2022	Mar. 31, 2022	Sep. 30, 2023
Class of Stock [Line Items]
Aggregate offering price	$ 67,028	$ 65,641	$ 56,364	$ 114,533
Common ATM Program-1
Class of Stock [Line Items]
Aggregate offering price					$ 100,000
Number of Shares Sold					12,356
Weighted Average Price Per Share					$ 8,032.74
Gross proceeds					$ 99,300
Net proceeds					95,700
Common ATM Program-2
Class of Stock [Line Items]
Aggregate offering price					$ 150,000
Number of Shares Sold					14,395
Weighted Average Price Per Share					$ 10,413.79
Gross proceeds					$ 149,900
Net proceeds					144,400
Common ATM Program-3
Class of Stock [Line Items]
Aggregate offering price					$ 250,000
Number of Shares Sold					83,719
Weighted Average Price Per Share					$ 2,986.18
Gross proceeds					$ 250,000
Net proceeds					241,000
Common ATM Program-4
Class of Stock [Line Items]
Aggregate offering price					$ 250,000
Number of Shares Sold					6,262,182
Weighted Average Price Per Share					$ 36.15
Gross proceeds					$ 226,400
Net proceeds					$ 219,300

Stockholders' Equity (Tables)

9 Months Ended

Sep. 30, 2023

Stockholders' Equity

Schedule of sales of shares of Common Stock


Supplement	Period	Number of Shares Sold	Weighted Average Price Per Share	Gross Proceeds	Net Proceeds
Prospectus supplement dated May 27, 2021 with an aggregate offering price of up to $100.0 million (“Common ATM Program–1”)	May 28, 2021 through July 1, 2021	12,356	$8,032.74	$99.3 million	$95.7 million
Prospectus supplement dated June 30, 2021 with an aggregate offering price of up to $150.0 million (“Common ATM Program–2”)	June 30, 2021 through September 2, 2021	14,395	$10,413.79	$149.9 million	$144.4 million
Prospectus supplement dated September 30, 2021 with an aggregate offering price of up to $250.0 million (“Common ATM Program–3”)	October 6, 2021 through March 31, 2022	83,719	$2,986.18	$250.0 million	$241.0 million
Prospectus supplement dated May 23, 2022 with an aggregate offering price of up to $250.0 million (“Common ATM Program–4”)	May 24, 2022 through March 31, 2023	6,262,182	$36.15	$226.4 million	$219.3 million

- Definition

Tabular disclosure of an entity's stock, including par or stated value per share, number and dollar amount of share subscriptions, shares authorized, shares issued, shares outstanding, number and dollar amount of shares held in an employee trust, dividend per share, total dividends, share conversion features, par value plus additional paid in capital, the value of treasury stock and other information necessary to a fair presentation, and EPS information. Stock by class includes common, convertible, and preferred stocks which are not redeemable or redeemable solely at the option of the issuer. Includes preferred stock with redemption features that are solely within the control of the issuer and mandatorily redeemable stock if redemption is required to occur only upon liquidation or termination of the reporting entity. If more than one issue is outstanding, state the title of each issue and the corresponding dollar amount; dollar amount of any shares subscribed but unissued and the deduction of subscriptions receivable there from; number of shares authorized, issued, and outstanding.

+ References

Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 45
-Paragraph 2
-URI https://asc.fasb.org/extlink&oid=65888546&loc=d3e21300-112643

Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(28))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 10
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21553-112644

Reference 4: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 480
-SubTopic 10
-Section S99
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=122040564&loc=d3e177068-122764

Reference 5: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 8
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21538-112644

Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 7
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21521-112644

Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(29))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 8: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 5
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21488-112644

Reference 9: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.3-04)
-URI https://asc.fasb.org/extlink&oid=120397183&loc=d3e187085-122770

Reference 10: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 6
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21506-112644

Reference 11: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 210
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SX 210.5-02(27))
-URI https://asc.fasb.org/extlink&oid=120391452&loc=d3e13212-122682

Reference 12: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 4
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21484-112644

Reference 13: http://fasb.org/us-gaap/role/ref/legacyRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 505
-SubTopic 10
-Section 50
-Paragraph 3
-URI https://asc.fasb.org/extlink&oid=126973232&loc=d3e21475-112644

+ Details

Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Sep. 30, 2023	Jan. 05, 2024
Document Information [Line Items]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Sep. 30, 2023
Document Transition Report	false
Entity File Number	001-36788
Entity Registrant Name	EXELA TECHNOLOGIES, INC.
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	47-1347291
Entity Address, Address Line One	2701 E. Grauwyler Rd.
Entity Address, City or Town	Irving
Entity Address, State or Province	TX
Entity Address, Postal Zip Code	75061
City Area Code	844
Local Phone Number	935-2832
Entity Current Reporting Status	No
Entity Interactive Data Current	Yes
Entity Filer Category	Accelerated Filer
Entity Small Business	true
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		6,365,353
Entity Central Index Key	0001620179
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2023
Document Fiscal Period Focus	Q3
Amendment Flag	false
Common Stock
Document Information [Line Items]
Title of 12(b) Security	Common Stock, Par Value $0.0001 per share
Trading Symbol	XELA
Security Exchange Name	NASDAQ
6.00% Series B Cumulative Convertible Perpetual Preferred Stock
Document Information [Line Items]
Title of 12(b) Security	6.00% Series B Cumulative Convertible Perpetual Preferred Stock, par value $0.0001 per share
Trading Symbol	XELAP
Security Exchange Name	NASDAQ

Related-Party Transactions - Subscription Agreements (Details) - USD ($) $ in Thousands		9 Months Ended
	Aug. 11, 2022	Sep. 30, 2023	Sep. 30, 2022
Related Party Transaction [Line Items]
Proceeds from issuance of Common Stock from at the market offerings		$ 69,260	$ 245,073
Subscription Agreements \| Par Chadha [Member]
Related Party Transaction [Line Items]
Issuance of Common Stock from at the market offerings, net of offering costs (in shares)	355
Proceeds from issuance of Common Stock from at the market offerings	$ 100

General - Net Loss per Share (Details) - USD ($) $ / shares in Units, $ in Thousands		3 Months Ended		9 Months Ended
	Mar. 18, 2021	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Net loss per share
Number of anti-dilutive shares excluded from computation of diluted loss per share				2,471	2,486
Net loss attributable to common stockholders		$ (25,298)	$ (87,326)	$ (105,865)	$ (226,613)
Weighted average common shares outstanding - basic		6,365,353	315,725	5,854,840	176,875
Weighted average common shares outstanding - diluted		6,365,353	315,725	5,854,840	176,875
Basic (in dollars per share)		$ (3.97)	$ (276.59)	$ (18.08)	$ (1,281.20)
Diluted (in dollars per share)		$ (3.97)	$ (276.59)	$ (18.08)	$ (1,281.20)
Series A Preferred Stock
Net loss per share
Number of anti-dilutive shares excluded from computation of diluted loss per share				393
Series B Preferred Stock
Net loss per share
Number of anti-dilutive shares excluded from computation of diluted loss per share				16,079
Warrant \| Private Placement
Net loss per share
Number of anti-dilutive shares excluded from computation of diluted loss per share	9,731,819
Common Stock
Net loss per share
Number of anti-dilutive shares excluded from computation of diluted loss per share				2,433

Employee Benefit Plans - Tax Effect on Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Millions	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Amounts in Accumulated Other Comprehensive Loss Expected to be Recognized in Net Periodic Benefit Costs
Net actuarial loss	$ 3.6	$ 3.6
Deferred tax benefit	$ 2.0	$ 2.0

Long-Term Debt and Credit Facilities - Securitization (Details) - USD ($) $ in Thousands					1 Months Ended	3 Months Ended	9 Months Ended		12 Months Ended
	Jun. 17, 2022	Mar. 07, 2022	Apr. 11, 2021	Dec. 17, 2020	Dec. 31, 2020	Sep. 30, 2023	Sep. 30, 2023	Sep. 30, 2022	Dec. 31, 2022	Jul. 31, 2022	Jun. 17, 2020	Dec. 31, 2019	Jul. 12, 2017
Securitization Facility, Prepayment Premium	$ 2,700
Proceeds from initial borrowings							$ 9,600	$ 20,000
Senior secured revolving facility
Available facility amount												$ 100,000	$ 100,000
A/R Facility
Accounts Receivable from Securitization				$ 160,000
Securitization facility, payment of accrued interest and fees				83,000
Securitization Facility
Variable interest rate (as a percent)					8.75%
Write off of previously recognized debt issuance costs	3,300
Repayment of principal, accrued interest and fees	500
Securitization facility, payment of accrued interest and fees	1,300
Outstanding borrowings under the facility	91,900										$ 91,900
Facility term (years)			5 years
Available facility amount				145,000
Initial funding supported by receivables				92,000
Accounts Receivable, Sale	$ 85,000
Accounts receivable de-recognized						$ 119,300	382,200		$ 408,900
Percentage of face value of accounts receivable	100.00%
Further funding supported by inventory and intellectual property				$ 53,000
Proceeds from additional borrowings			$ 53,000
Remitted amount						119,000	385,500		308,700
Accounts receivable, Unsold, Pledged as collateral						47,100	47,100		$ 46,500
Pre-tax loss						$ 2,000	$ 5,900
Securitization Facility \| Federal funds rate
Variable interest rate (as a percent)					0.50%
Securitization Facility \| One-month adjusted LIBOR
Variable interest rate (as a percent)					1.00%
Securitization Facility \| LIBOR
Variable interest rate (as a percent)					9.75%
Revolving Loan Exchange and Prepayment Agreement
Principal amount										$ 9,000
Write off of previously recognized debt issuance costs		$ 200

Condensed Consolidated Statements of Stockholders' Deficit (Unaudited) (Parenthetical) - $ / shares	3 Months Ended
	Sep. 30, 2022	Jun. 30, 2022
Series B Preferred Stock
Dividend declared and paid on Series B Preferred Stock	$ 0.375	$ 0.46

Long-Term Debt and Credit Facilities - Long-Term Debt Outstanding (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Jul. 11, 2023	Dec. 31, 2022
Long-Term Debt and Credit Facilities.
Total debt	$ 1,091,996		$ 1,096,837
Less: Current portion of long-term debt	(48,221)		(154,802)
Long-term debt, net of current maturities	1,043,775		942,035
Senior Secured Term Loan
Long-Term Debt and Credit Facilities.
Total debt	38,264
Unamortized debt issuance costs	1,700
New notes
Long-Term Debt and Credit Facilities.
Total debt	943,642
Debt exchange premium	131,700
Other
Long-Term Debt and Credit Facilities.
Total debt	34,561		25,117
First lien credit agreement
Long-Term Debt and Credit Facilities.
Total debt			71,470
Debt discount			200
Unamortized debt issuance costs			900
Second Lien Secured Term Loan
Long-Term Debt and Credit Facilities.
Unamortized debt issuance costs	4,600
Second Lien Secured Term Loan \| New notes
Long-Term Debt and Credit Facilities.
Total debt	26,937
New notes
Long-Term Debt and Credit Facilities.
Debt exchange premium		$ 142,300
Senior secured notes
Long-Term Debt and Credit Facilities.
Debt discount			100
Unamortized debt issuance costs			100
2023 notes
Long-Term Debt and Credit Facilities.
Total debt	9,000
2023 notes \| Senior secured notes
Long-Term Debt and Credit Facilities.
Total debt			22,762
2026 notes
Long-Term Debt and Credit Facilities.
Total debt	0	$ 24,000	980,000
2026 notes \| Senior secured notes
Long-Term Debt and Credit Facilities.
Total debt	22,693		908,959
Debt discount	300
Debt exchange premium			58,800
Unamortized debt issuance costs	1,000		12,100
BRCC Facility \| New notes
Long-Term Debt and Credit Facilities.
Total debt	$ 25,899		$ 68,529

Significant Accounting Policies (Policies)

9 Months Ended

Sep. 30, 2023

Significant Accounting Policies

Revenue Recognition

Revenue Recognition

We account for revenue in accordance with ASC 606, Revenue from Contracts with Customers. A performance obligation is a promise in a contract to transfer a distinct good or service to the customer and is the unit of account in ASC 606. Revenue is measured as the amount of consideration we expect to receive in exchange for transferring goods or providing services. The contract transaction price is allocated to each distinct performance obligation and recognized as revenue when, or as, the performance obligation is satisfied. All of our material sources of revenue are derived from contracts with customers, primarily relating to the provision of business and transaction processing services within each of our segments. We do not have any significant extended payment terms, as payment is received shortly after goods are delivered or services are provided.

Nature of Services

Our primary performance obligations are to stand ready to provide various forms of business processing services, consisting of a series of distinct services, but that are substantially the same, and have the same pattern of

transfer over time, and accordingly are combined into a single performance obligation. Our promise to our customers is typically to perform an unknown or unspecified quantity of tasks and the consideration received is contingent upon the customers’ use (i.e., number of transactions processed, requests fulfilled, etc.); as such, the total transaction price is variable. We allocate variable fees to the single performance obligation charged to the distinct service period in which we have the contractual right to bill under the contract.

Disaggregation of Revenues

The Company is organized into three segments: Information & Transaction Processing Solutions (“ITPS”), Healthcare Solutions (“HS”), and Legal & Loss Prevention Services (“LLPS”) (See Note 13 – Segment and Geographic Area Information). The following tables disaggregate revenue from contracts by segment and by geographic region for the three and nine months ended September 30, 2023 and 2022:


	Three Months Ended September 30,
	2023								2022
		ITPS		HS		LLPS		Total		ITPS		HS		LLPS		Total
U.S.A.	$	127,074	$	62,090	$	18,885	$	208,049	$	141,904	$	60,955	$	17,774	$	220,633
EMEA		40,035		—		—		40,035		39,053		—		—		39,053
Other		5,041		—		—		5,041		4,352		—		—		4,352
Total	$	172,150	$	62,090	$	18,885	$	253,125	$	185,309	$	60,955	$	17,774	$	264,038


	Nine Months Ended September 30,
	2023								2022
		ITPS		HS		LLPS		Total		ITPS		HS		LLPS		Total
U.S.A.	$	410,598	$	188,740	$	60,095	$	659,433	$	429,979	$	173,940	$	55,946	$	659,865
EMEA		125,107		—		—		125,107		136,722		—		—		136,722
Other		15,143		—		—		15,143		13,619		—		—		13,619
Total	$	550,848	$	188,740	$	60,095	$	799,683	$	580,320	$	173,940	$	55,946	$	810,206

Contract Balances

The following table presents contract assets, contract liabilities and contract costs recognized at September 30, 2023 and December 31, 2022:


	September 30,		December 31,		January 1,
	2023		2022		2022
Accounts receivable, net	$	96,867	$	101,616	$	184,102
Deferred revenues		14,881		17,585		17,518
Customer deposits		16,319		16,955		17,707
Costs to obtain and fulfill a contract	$	1,485	$	1,674	$	2,328

Accounts receivable, net includes $29.7 million and $25.7 million as of September 30, 2023 and December 31, 2022, respectively, representing amounts not yet billed to customers. We have accrued the unbilled receivables for work performed in accordance with the terms of contracts with customers.

Deferred revenues relate to payments received in advance of performance under a contract. A significant portion of this balance relates to maintenance contracts or other service contracts where we received payments for upfront conversions or implementation activities which do not transfer a service to the customer but rather are used in fulfilling the related performance obligations that transfer over time. The advance consideration received from customers is deferred over the contract term. We recognized revenue of $1.6 million and $16.4 million during the three and nine months ended September 30, 2023, respectively that had been deferred as of December 31, 2022. We recognized revenue of $1.8 million and $15.3 million during the three and nine months ended September 30, 2022, respectively that

had been deferred as of January 1, 2022. We recognized revenue of $16.5 million during the year ended December 31, 2022 that had been deferred as of January 1, 2022.

Costs incurred to obtain and fulfill contracts are deferred and presented as part of intangible assets, net and expensed on a straight-line basis over the estimated benefit period. We recognized $0.2 million and $0.2 million of amortization for these costs for the three months ended September 30, 2023 and 2022, respectively, within depreciation and amortization expense. We recognized $0.6 million and $0.8 million of amortization for these costs for the nine months ended September 30, 2023 and 2022, respectively, within depreciation and amortization expense. We recognized $1.1 million of amortization for these costs in 2022 within depreciation and amortization expense. These costs represent incremental external costs or certain specific internal costs that are directly related to the contract acquisition or fulfillment and can be separated into two principal categories: contract commissions and fulfillment costs. Applying the practical expedient in ASC 340-40-25-4, we recognize the incremental costs of obtaining contracts as an expense when incurred, if the amortization period would have been one year or less. These costs are included in selling, general and administrative expenses. The effect of applying this practical expedient was not material.

Customer deposits consist primarily of amounts received from customers in advance for postage. These advanced postage deposits are used to cover the costs associated with postage, with the corresponding postage revenue being recognized as services are performed.

Performance Obligations

At the inception of each contract, we assess the goods and services promised in our contracts and identify each distinct performance obligation. The majority of our contracts have a single performance obligation, as the promise to transfer the individual goods or services is not separately identifiable from other promises in the contracts. For the majority of our business and transaction processing service contracts, revenues are recognized as services are provided based on an appropriate input or output method, typically based on the related labor or transactional volumes.

Certain of our contracts have multiple performance obligations, including contracts that combine software implementation services with post-implementation customer support. For contracts with multiple performance obligations, we allocate the contract’s transaction price to each performance obligation using our best estimate of the standalone selling price of each distinct good or service in the contract. The primary method used to estimate standalone selling price is the expected cost plus a margin approach, under which we estimate our expected costs of satisfying a performance obligation and add an appropriate margin for that distinct good or service. We also use the adjusted market approach whereby we estimate the price that customers in the market would be willing to pay. In assessing whether to allocate variable consideration to a specific part of the contract, we consider the nature of the variable payment and whether it relates specifically to its efforts to satisfy a specific part of the contract. Certain of our software implementation performance obligations are satisfied at a point in time, typically when customer acceptance is obtained.

When evaluating the transaction price, we analyze, on a contract-by-contract basis, all applicable variable consideration. The nature of our contracts gives rise to variable consideration, including volume discounts, contract penalties, and other similar items that generally decrease the transaction price. We estimate these amounts based on the expected amount to be provided to customers and reduce revenues recognized. We do not anticipate significant changes to our estimates of variable consideration.

We include reimbursements from customers, such as postage costs, in revenue, while the related costs are included in cost of revenue.

Transaction Price Allocated to the Remaining Performance Obligations

In accordance with optional exemptions available under ASC 606, we did not disclose the value of unsatisfied performance obligations for (a) contracts with an original expected length of one year or less, and (b) contracts for which variable consideration relates entirely to an unsatisfied performance obligation, which comprise the majority of our contracts. We have certain non-cancellable contracts where we receive a fixed monthly fee in exchange for a series of distinct services that are substantially the same and have the same pattern of transfer over time, with the corresponding remaining performance obligations as of September 30, 2023 in each of the future periods below:


Estimated Remaining Fixed Consideration for Unsatisfied Performance Obligations

Remainder of 2023	$	10,169
2024		35,699
2025		30,338
2026		3,663
2027		2,041
2028 and thereafter		1,226
Total	$	83,136

- Definition

Disclosure of accounting policy for revenue from contract with customer.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 17
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130561-203045

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 20
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130566-203045

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130563-203045

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-URI https://asc.fasb.org/topic&trid=49130388

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 20
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130566-203045

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 18
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130563-203045

Reference 7: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 235
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=126899994&loc=d3e18823-107790

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 20
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130566-203045

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 19
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130564-203045

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 20
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130566-203045

+ Details

Condensed Consolidated Statements of Stockholders' Deficit (Unaudited) - USD ($) $ in Thousands	Common Stock	Preferred Stock Series A Preferred Stock	Preferred Stock Series B Preferred Stock	Treasury Stock	Additional Paid in Capital Series B Preferred Stock	Additional Paid in Capital	Equity-based compensation	Foreign currency translation adjustment	Unrealized Pension Actuarial Losses, net of tax	Accumulated Deficit	Series B Preferred Stock	Total
Beginning balance at Dec. 31, 2021	$ 37	$ 1		$ (10,949)		$ 838,853	$ 56,123	$ (7,463)	$ (10,946)	$ (1,532,428)		$ (666,772)
Beginning balance (in shares) at Dec. 31, 2021	66,300	2,778,111		612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss										(56,956)		(56,956)
Equity-based compensation							302					302
Foreign currency translation adjustment								1,477				1,477
Net realized pension actuarial gains (loss), net of tax									308			308
Common Stock exchanged for Series B Preferred Stock	$ (2)					2
Common Stock exchanged for Series B Preferred Stock (in shares)	(4,502)		900,328
Issuance of Common Stock from at the market offerings, net of offering costs	$ 24					114,509						114,533
Issuance of Common Stock from at the market offerings, net of offering costs (in shares)	59,070
Withholding of employee taxes on vested RSUs							(190)					(190)
Common Stock issued for vested RSUs (in shares)	272
Ending balance at Mar. 31, 2022	$ 59	$ 1		$ (10,949)		953,364	56,235	(5,986)	(10,638)	(1,589,384)		(607,298)
Ending balance (in shares) at Mar. 31, 2022	121,140	2,778,111	900,328	612
Beginning balance at Dec. 31, 2021	$ 37	$ 1		$ (10,949)		838,853	56,123	(7,463)	(10,946)	(1,532,428)		(666,772)
Beginning balance (in shares) at Dec. 31, 2021	66,300	2,778,111		612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss												(221,437)
Foreign currency translation adjustment												4,588
Net realized pension actuarial gains (loss), net of tax												1,934
Ending balance at Sep. 30, 2022	$ 142	$ 1		$ (10,949)		1,072,322	56,676	(2,875)	(9,012)	(1,753,865)		(647,560)
Ending balance (in shares) at Sep. 30, 2022	400,255	2,778,111	3,029,900	612
Beginning balance at Mar. 31, 2022	$ 59	$ 1		$ (10,949)		953,364	56,235	(5,986)	(10,638)	(1,589,384)		(607,298)
Beginning balance (in shares) at Mar. 31, 2022	121,140	2,778,111	900,328	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss										(79,199)		(79,199)
Equity-based compensation							528					528
Foreign currency translation adjustment								1,133				1,133
Net realized pension actuarial gains (loss), net of tax									802			802
Common Stock exchanged for Series B Preferred Stock	$ (4)					4
Common Stock exchanged for Series B Preferred Stock (in shares)	(10,648)		2,129,572
Issuance of Common Stock from at the market offerings, net of offering costs	$ 36					56,328						56,364
Issuance of Common Stock from at the market offerings, net of offering costs (in shares)	90,948
Withholding of employee taxes on vested RSUs							(2)					(2)
Common Stock issued for vested RSUs (in shares)	12
Agreed cancellation of Common Stock issued for Director's vested RSUs (in shares)	(155)
Dividend declared and paid on Preferred Stock					$ (1,396)						$ (1,396)
Ending balance at Jun. 30, 2022	$ 91	$ 1		$ (10,949)		1,008,300	56,761	(4,853)	(9,836)	(1,668,583)		(629,068)
Ending balance (in shares) at Jun. 30, 2022	201,297	2,778,111	3,029,900	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss										(85,282)		(85,282)
Equity-based compensation							(142)					(142)
Foreign currency translation adjustment								1,978				1,978
Net realized pension actuarial gains (loss), net of tax									824			824
Issuance of Common Stock from at the market offerings, net of offering costs	$ 51					65,590						65,641
Issuance of Common Stock from at the market offerings, net of offering costs (in shares)	200,468
Dividend declared and paid on Preferred Stock						(1,136)						(1,136)
Common Stock repurchased and retired						(487)						(487)
Common Stock repurchased and retired (in shares)	(1,787)
Reversal of excess withholding of employee taxes on vested RSUs							57					57
Issuance of Common Stock to Executive Chairman under certain subscription agreement						100						100
Issuance of Common Stock to Executive Chairman under certain subscription agreement, shares	355
Cancellation of fractional Common Stock on Reverse Stock Split						(45)						(45)
Ending balance at Sep. 30, 2022	$ 142	$ 1		$ (10,949)		1,072,322	56,676	(2,875)	(9,012)	(1,753,865)		(647,560)
Ending balance (in shares) at Sep. 30, 2022	400,255	2,778,111	3,029,900	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Cancellation of fractional Common Stock on Reverse Stock Split (shares)	(78)
Beginning balance at Dec. 31, 2022	$ 162	$ 1		$ (10,949)		1,102,619	56,958	(4,788)	(3,583)	(1,948,009)		(807,589)
Beginning balance (in shares) at Dec. 31, 2022	1,393,276	2,778,111	3,029,900	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss										(45,436)		(45,436)
Equity-based compensation							111					111
Foreign currency translation adjustment								(2,105)				(2,105)
Net realized pension actuarial gains (loss), net of tax									(89)			(89)
Issuance of Common Stock from at the market offerings, net of offering costs	$ 99					66,929						67,028
Issuance of Common Stock from at the market offerings, net of offering costs (in shares)	4,977,744
Ending balance at Mar. 31, 2023	$ 261	$ 1		$ (10,949)		1,169,548	57,069	(6,893)	(3,672)	(1,993,445)		(788,080)
Ending balance (in shares) at Mar. 31, 2023	6,371,020	2,778,111	3,029,900	612
Beginning balance at Dec. 31, 2022	$ 162	$ 1		$ (10,949)		1,102,619	56,958	(4,788)	(3,583)	(1,948,009)		(807,589)
Beginning balance (in shares) at Dec. 31, 2022	1,393,276	2,778,111	3,029,900	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss												(99,430)
Foreign currency translation adjustment												(3,369)
Net realized pension actuarial gains (loss), net of tax												(58)
Ending balance at Sep. 30, 2023	$ 261	$ 1				1,169,517	57,524	(8,157)	(3,641)	(2,058,388)		(842,883)
Ending balance (in shares) at Sep. 30, 2023	6,365,353	2,778,111	3,029,900
Beginning balance at Mar. 31, 2023	$ 261	$ 1		$ (10,949)		1,169,548	57,069	(6,893)	(3,672)	(1,993,445)		(788,080)
Beginning balance (in shares) at Mar. 31, 2023	6,371,020	2,778,111	3,029,900	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss										(30,886)		(30,886)
Equity-based compensation							203					203
Foreign currency translation adjustment								1,901				1,901
Net realized pension actuarial gains (loss), net of tax									(116)			(116)
Payment for fractional shares on reverse stock split in May 2023						(31)						(31)
Payment for fractional shares on reverse stock split in May 2023 (shares)	(5,667)
Ending balance at Jun. 30, 2023	$ 261	$ 1		$ (10,949)		1,169,517	57,272	(4,992)	(3,788)	(2,024,331)		(817,009)
Ending balance (in shares) at Jun. 30, 2023	6,365,353	2,778,111	3,029,900	612
Increase (Decrease) in Stockholders' Equity (Deficit)
Net loss										(23,108)		(23,108)
Equity-based compensation							252					252
Foreign currency translation adjustment								(3,165)				(3,165)
Net realized pension actuarial gains (loss), net of tax									147			147
Treasury stock retired				$ 10,949						(10,949)
Treasury stock retired (in shares)				(612)
Ending balance at Sep. 30, 2023	$ 261	$ 1				$ 1,169,517	$ 57,524	$ (8,157)	$ (3,641)	$ (2,058,388)		$ (842,883)
Ending balance (in shares) at Sep. 30, 2023	6,365,353	2,778,111	3,029,900

Significant Accounting Policies - Disaggregation of Revenues (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Disaggregation of Revenues
Revenue	$ 253,125	$ 264,038	$ 799,683	$ 810,206
United States
Disaggregation of Revenues
Revenue	208,049	220,633	659,433	659,865
EMEA
Disaggregation of Revenues
Revenue	40,035	39,053	125,107	136,722
Other.
Disaggregation of Revenues
Revenue	5,041	4,352	15,143	13,619
ITPS
Disaggregation of Revenues
Revenue	172,150	185,309	550,848	580,320
ITPS \| United States
Disaggregation of Revenues
Revenue	127,074	141,904	410,598	429,979
ITPS \| EMEA
Disaggregation of Revenues
Revenue	40,035	39,053	125,107	136,722
ITPS \| Other.
Disaggregation of Revenues
Revenue	5,041	4,352	15,143	13,619
HS
Disaggregation of Revenues
Revenue	62,090	60,955	188,740	173,940
HS \| United States
Disaggregation of Revenues
Revenue	62,090	60,955	188,740	173,940
LLPS
Disaggregation of Revenues
Revenue	18,885	17,774	60,095	55,946
LLPS \| United States
Disaggregation of Revenues
Revenue	$ 18,885	$ 17,774	$ 60,095	$ 55,946

- Definition

Amount, excluding tax collected from customer, of revenue from satisfaction of performance obligation by transferring promised good or service to customer. Tax collected from customer is tax assessed by governmental authority that is both imposed on and concurrent with specific revenue-producing transaction, including, but not limited to, sales, use, value added and excise.

+ References

Reference 1: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 30
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8906-108599

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 40
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 41
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 32
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 4
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130543-203045

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 22
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 280
-SubTopic 10
-Section 50
-Paragraph 42
-URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 606
-SubTopic 10
-Section 50
-Paragraph 5
-URI https://asc.fasb.org/extlink&oid=126920106&loc=SL49130545-203045

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 924
-SubTopic 10
-Section S99
-Paragraph 1
-Subparagraph (SAB Topic 11.L)
-URI https://asc.fasb.org/extlink&oid=6472922&loc=d3e499488-122856

+ Details

Income Taxes (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
Income Taxes (Details) - USD ($) $ in Thousands	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Income Taxes
Income tax expense	$ 1,807	$ 1,924	$ 7,005	$ 5,721
Annual effective tax rate	(8.50%)	(2.30%)	(7.60%)	(2.70%)
Statutory tax rate			21.00%

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Commitments and Contingencies

9 Months Ended

Sep. 30, 2023

Commitments and Contingencies

Commitments and Contingencies

8. Commitments and Contingencies

Adverse Arbitration Order

In April 2020, one of the Company's Nordic subsidiaries commenced an arbitration in Finland against a customer alleging breach of contract and other damages in connection with an outsourcing services agreement and transition services agreement executed in 2017. In September 2020, the customer submitted counterclaims against the Company in an aggregate amount in excess of €10.0 million. Following an expedited arbitration, in late November 2020, the arbitrator awarded the customer approximately $13.0 million in the aggregate for the counterclaimed damages and costs. The Company filed an application to annul the award in late January 2021 with the relevant court asserting, among other bases, that the arbitrator violated due process and procedural rules by disallowing the Company’s witness and expert testimony and maintaining the expedited format following the assertion of significant counterclaims which would ordinarily have required the application of normal rather than expedited rules. On May 28, 2021, the parties entered into a settlement agreement resolving this dispute for a total of $8.8 million including the reimbursement of certain third party charges. As of September 30, 2023, there was a net outstanding balance of $0.9 million for this matter included in accrued liabilities on the condensed consolidated balance sheet.

Class Action

On March 23, 2020, the Plaintiff, Bo Shen, filed a putative class action against the Company, Ronald Cogburn, the Company’s former Chief Executive Officer, and James Reynolds, the Company’s former Chief Financial Officer and current member of the Company’s board of directors (the “Board”). Plaintiff claims to have been a holder of 4,000 shares of Company stock, purchased on October 4, 2019 at $1.34/share (in the case of the number of shares and share price without adjusting for any of the reverse stock splits occurring after that date). Plaintiff asserts two claims covering the purported class period of March 16, 2018 to March 16, 2020: (1) a violation of Section 10(b) and Rule 10b-5 of the Exchange Act against all defendants; and (2) a violation of Section 20(a) of the Exchange Act against Mr. Cogburn and Mr. Reynolds. The allegations stem from the Company’s press release, dated March 16, 2020 (announcing the postponement of the earnings call and delay in filing of its annual report on Form 10-K for the fiscal year ended December 31, 2019), and press release and related SEC filings, dated March 17, 2020 (announcing its intent to restate its financial statements for 2017, 2018 and interim periods through September 30, 2019) and certain other matters. On July 27, 2023, the parties submitted a settlement agreement to the Court that, if approved, will result in the dismissal of the action with prejudice in exchange for a settlement payment of $5.0 million, which the Company anticipates will be funded by the Company’s insurance carrier to the extent the payment exceeds any remaining deductible under the applicable insurance policy. The settlement agreement was preliminary approved by the Court on August 21, 2023 and the final approval hearing took place on December 7, 2023. The court granted the settlement in full and entered a final judgment of dismissal and final orders approving the plan of allocation and plaintiffs’ attorneys’ fee award, which will be paid entirely out of the existing settlement fund.

Contract-Related Contingencies

The Company has certain contingent obligations that arise in the ordinary course of providing services to its customers. These contingencies are generally the result of contracts that require the Company to comply with certain performance measurements or the delivery of certain services to customers by a specified deadline. The Company believes the adjustments to the transaction price, if any, under these contract provisions will not result in a significant revenue reversal or have a material adverse effect on the Company’s condensed consolidated balance sheets, condensed consolidated statements of operations or condensed consolidated statements of cash flows.

Employee Benefit Plans - Germany & UK (Details) $ in Millions	9 Months Ended
	Sep. 30, 2023 USD ($)
German Pension Plan
Pension plans
Plan assets	$ 0.0
German Pension Plan \| Minimum
Pension plans
Qualifying period	10 years
German Pension Plan \| Maximum
Pension plans
Defined Benefit Plan, Funding Status [Extensible Enumeration]	us-gaap:UnfundedPlanMember
U.K. Pension Plan \| Minimum
Pension plans
Minimum required years prior to retirement for eligibility	3 years
Asterion Pension Plan \| Minimum
Pension plans
Minimum required years prior to retirement for eligibility	3 years
Norway Pension Plan \| Minimum
Pension plans
Minimum required years prior to retirement for eligibility	3 years

Intangible Assets and Goodwill (Tables)

9 Months Ended

Sep. 30, 2023

Intangible Assets and Goodwill

Schedule of intangible assets


	September 30, 2023
	Gross Carrying		Accumulated		Intangible
	Amount (a)		Amortization		Asset, net
Customer relationships	$	507,675	$	(373,656)	$	134,019
Developed technology		88,553		(88,026)		527
Patent		15		(14)		1
Trade names (b)		8,400		(3,100)		5,300
Outsource contract costs		17,616		(16,131)		1,485
Internally developed software		55,107		(40,786)		14,321
Purchased software		26,749		(8,471)		18,278
Intangibles, net	$	704,115	$	(530,184)	$	173,931


	December 31, 2022
	Gross Carrying		Accumulated		Intangible
	Amount (a)		Amortization		Asset, net
Customer relationships	$	507,723	$	(351,240)	$	156,483
Developed technology		88,553		(88,000)		553
Patent		15		(6)		9
Trade names (b)		8,400		(3,100)		5,300
Outsource contract costs		17,184		(15,509)		1,675
Internally developed software		52,441		(35,095)		17,346
Purchased software		26,749		(7,133)		19,616
Intangibles, net	$	701,065	$	(500,083)	$	200,982

(a)	Amounts include intangible assets acquired in business combinations and asset acquisitions.

(b)	The carrying amount of trade names for 2023 and 2022 is net of accumulated impairment losses of $44.1 million. Carrying amount of $5.3 million as at September 30, 2023 represents indefinite-lived intangible assets.

Schedule of goodwill by reporting segment




	Balances as at January 1, 2023 (a)			Additions		Deletions			Impairments		Currency Translation Adjustments		Balances as at September 30, 2023 (a)
ITPS	$	81,151	$	—	$	(16,500)	(b)	$	—	$	(40)	$	64,611
HS		86,786		—		—			—		—		86,786
LLPS		18,865		—		—			—		—		18,865
Total	$	186,802	$	—	$	(16,500)		$	—	$	(40)	$	170,262

	Balances as at January 1, 2022 (a)			Additions		Deletions			Impairments		Currency Translation Adjustments		Balances as at December 31, 2022 (a)
ITPS	$	252,672	$	—	$	—		$	(171,182)	$	(339)	$	81,151
HS		86,786		—		—			—		—		86,786
LLPS		18,865		—		—			—		—		18,865
Total	$	358,323	$	—	$	—		$	(171,182)	$	(339)	$	186,802

(a)

The goodwill amount for all periods presented is net of accumulated impairment amounts. Accumulated impairment relating to ITPS was $487.7 million, $487.7 million and $316.5 million as at September 30, 2023, December 31, 2022 and December 31, 2021, respectively. Accumulated impairment relating to LLPS was $243.4 million as at September 30, 2023, December 31, 2022 and December 31, 2021, respectively.

(b)	The deletion in goodwill is due to derecognition of allocated goodwill on sale of the high-speed scanner business in the second quarter of 2023. Refer to Note 1—General.

- Definition

Tabular disclosure of goodwill by reportable segment and in total which includes a rollforward schedule.

+ References

Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (h)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 2: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (g)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 4: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 5: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (e)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 6: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (d)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 7: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1A
-URI https://asc.fasb.org/extlink&oid=121556970&loc=SL108378252-109267

Reference 8: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (f)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 9: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (a)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

Reference 10: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 2
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13854-109267

Reference 11: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 55
-Paragraph 24
-URI https://asc.fasb.org/extlink&oid=122137925&loc=d3e14258-109268

Reference 12: http://www.xbrl.org/2009/role/commonPracticeRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 350
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (b)
-URI https://asc.fasb.org/extlink&oid=121556970&loc=d3e13816-109267

+ Details

Significant Accounting Policies - Segment Reporting (Details)	9 Months Ended
	Sep. 30, 2023 segment
Significant Accounting Policies
Number of segments	3

New Accounting Pronouncements (Tables)

9 Months Ended

Sep. 30, 2023

New Accounting Pronouncements

Schedule of new accounting standard adoption

The following table describes the changes in the allowance for expected credit losses for the nine months ended September 30, 2023 (all related to accounts receivables):


Balance at January 1, 2023 of the allowance for expected credit losses	$	6,402
Change in the provision for expected credit losses for the period		(724)
Balance at September 30, 2023 of the allowance for expected credit losses	$	5,678

Stock-Based Compensation - Summary of activity for the Market Performance RSUs (Details) - Market Performance Units - $ / shares	9 Months Ended	12 Months Ended
	Sep. 30, 2023	Dec. 31, 2022
Number of Units
Balance at the beginning of the period	2,125
Balance at the end of the period	2,125	2,125
Weighted Average Grant Date Fair Value
Balance at the beginning of the period	$ 1,820.00
Balance at the end of the period	$ 1,820.00	$ 1,820.00
Weighted Average Period Over Which Expected to be Recognized
Weighted average remaining contractual life (in years)	2 years 11 months 23 days	2 years 11 months 23 days

Stockholders' Equity - Reverse Stock Split (Details)	May 12, 2023 shares	Sep. 30, 2023 shares	Dec. 31, 2022 shares
STOCKHOLDERS' EQUITY
Reverse stock split	0.005
Conversion of shares (in shares)	1
Common stock, shares issued		6,365,353	1,393,889
Common stock, shares outstanding		6,365,353	1,393,276
Prior To Stock Split [Member]
STOCKHOLDERS' EQUITY
Common stock, shares outstanding			278,655,235

Related-Party Transactions

9 Months Ended

Sep. 30, 2023

Related-Party Transactions

Related-Party Transactions

12. Related-Party Transactions

Relationship with HandsOn Global Management

The Company incurred reimbursable travel expenses to HOVS LLC and HandsOn Fund 4 I, LLC (collectively, and together with certain of their affiliated entities managed by HandsOn Global Management LLC, including such entity, “HGM”) of $0 and less than $0.1 million for the three months ended September 30, 2023 and 2022, respectively, and less than $0.1 million for each of the nine months ended September 30, 2023 and 2022. Certain members of our Board, including our Executive Chairman, Par Chadha, Sharon Chadha, Ron Cogburn, and James Reynolds are or have been affiliated with HGM. Our Executive Chairman, Par Chadha and his wife, Sharon Chadha, are currently affiliated with HGM. Messrs. Cogburn and Reynolds were affiliated with HGM until 2020.

Pursuant to a master agreement dated January 1, 2015 between Rule 14, LLC and a subsidiary of the Company, the Company incurs marketing fees to Rule 14, LLC, a portfolio company of HGM. Similarly, the Company is party to ten master agreements with entities affiliated with HGM’s managed funds, each of which were entered into during 2015 and 2016. Each master agreement provides the Company with use of certain technology and includes a reseller arrangement pursuant to which the Company is entitled to sell these services to third parties. Any revenue earned by the Company in such third-party sale is shared 75%/25% with each of HGM’s venture affiliates in favor of the Company. The brands Zuma, Athena, Peri, BancMate, Spring, Jet, Teletype, CourtQ and Rewardio are part of the HGM managed

funds. The Company has the license to use and resell such brands, as described therein. The Company incurred fees of $2.2 million and $1.5 million relating to these agreements for the three months ended September 30, 2023 and 2022, respectively. The Company incurred fees of $6.7 million and $4.6 million relating to these agreements for the nine months ended September 30, 2023 and 2022, respectively.

Certain operating companies lease their operating facilities from HOV RE, LLC and HOV Services Limited, which are affiliates under common control with HGM. The rental expense for these operating leases was less than $0.1 million and $0.1 million for the three and the nine months ended September 30, 2023, respectively, and $0.1 million and $0.2 million for the three and the nine months ended September 30, 2022, respectively. In addition, HOV Services, Ltd. provides the Company data capture and technology services. The expense recognized for these services was approximately $0.5 million and $0.4 million for the three months ended September 30, 2023 and 2022, respectively, and $1.3 million and $1.1 million for the nine months ended September 30, 2023 and 2022, respectively. These expenses are included in cost of revenue in the condensed consolidated statements of operations.

Consulting Agreement

The Company receives services from Oakana Holdings, Inc. The Company and Oakana Holdings, Inc. are related through a family relationship between our Executive Chairman and the president of Oakana Holdings, Inc. The expense recognized for these services was $0 and an expense reversal of less than $0.1 million for the three months ended September 30, 2023 and 2022, respectively, and less than $0.1 million for each of the nine months ended September 30, 2023 and 2022.

Subscription Agreements

On July 21, 2022, the Company entered into a subscription agreement with its Executive Chairman. Pursuant to this subscription agreement, on August 11, 2022, the Company issued and sold 355 shares of Common Stock to Par Chadha for an aggregate purchase price of $0.1 million.

Payable and Receivable/Prepaid Balances with Affiliates

Payable and receivable/prepaid balances with affiliates as of September 30, 2023 and December 31, 2022 were as follows:



	September 30, 2023				December 31, 2022
	Receivables and Prepaid Expenses		Payables		Receivables and Prepaid Expenses		Payables
HOV Services, Ltd	$	50	$	—	$	412	$	—
Rule 14		—		2,499		—		2,473
HGM		67		—		347		—
	$	117	$	2,499	$	759	$	2,473

Significant Accounting Policies (Tables)

9 Months Ended

Sep. 30, 2023

Significant Accounting Policies

Schedule of disaggregated revenue from contracts by geographic region and by segment


	Three Months Ended September 30,
	2023								2022
		ITPS		HS		LLPS		Total		ITPS		HS		LLPS		Total
U.S.A.	$	127,074	$	62,090	$	18,885	$	208,049	$	141,904	$	60,955	$	17,774	$	220,633
EMEA		40,035		—		—		40,035		39,053		—		—		39,053
Other		5,041		—		—		5,041		4,352		—		—		4,352
Total	$	172,150	$	62,090	$	18,885	$	253,125	$	185,309	$	60,955	$	17,774	$	264,038


	Nine Months Ended September 30,
	2023								2022
		ITPS		HS		LLPS		Total		ITPS		HS		LLPS		Total
U.S.A.	$	410,598	$	188,740	$	60,095	$	659,433	$	429,979	$	173,940	$	55,946	$	659,865
EMEA		125,107		—		—		125,107		136,722		—		—		136,722
Other		15,143		—		—		15,143		13,619		—		—		13,619
Total	$	550,848	$	188,740	$	60,095	$	799,683	$	580,320	$	173,940	$	55,946	$	810,206

Schedule of contract balances


	September 30,		December 31,		January 1,
	2023		2022		2022
Accounts receivable, net	$	96,867	$	101,616	$	184,102
Deferred revenues		14,881		17,585		17,518
Customer deposits		16,319		16,955		17,707
Costs to obtain and fulfill a contract	$	1,485	$	1,674	$	2,328

Schedule of estimated remaining fixed consideration for unsatisfied performance obligations


Estimated Remaining Fixed Consideration for Unsatisfied Performance Obligations

Remainder of 2023	$	10,169
2024		35,699
2025		30,338
2026		3,663
2027		2,041
2028 and thereafter		1,226
Total	$	83,136

Significant Accounting Policies

9 Months Ended

Sep. 30, 2023

Significant Accounting Policies

Significant Accounting Policies

3. Significant Accounting Policies

The information presented below supplements the Significant Accounting Policies information presented in the 2022 Form 10-K.

Revenue Recognition

Nature of Services

Disaggregation of Revenues


	Three Months Ended September 30,
	2023								2022
		ITPS		HS		LLPS		Total		ITPS		HS		LLPS		Total
U.S.A.	$	127,074	$	62,090	$	18,885	$	208,049	$	141,904	$	60,955	$	17,774	$	220,633
EMEA		40,035		—		—		40,035		39,053		—		—		39,053
Other		5,041		—		—		5,041		4,352		—		—		4,352
Total	$	172,150	$	62,090	$	18,885	$	253,125	$	185,309	$	60,955	$	17,774	$	264,038


	Nine Months Ended September 30,
	2023								2022
		ITPS		HS		LLPS		Total		ITPS		HS		LLPS		Total
U.S.A.	$	410,598	$	188,740	$	60,095	$	659,433	$	429,979	$	173,940	$	55,946	$	659,865
EMEA		125,107		—		—		125,107		136,722		—		—		136,722
Other		15,143		—		—		15,143		13,619		—		—		13,619
Total	$	550,848	$	188,740	$	60,095	$	799,683	$	580,320	$	173,940	$	55,946	$	810,206

Contract Balances

The following table presents contract assets, contract liabilities and contract costs recognized at September 30, 2023 and December 31, 2022:


	September 30,		December 31,		January 1,
	2023		2022		2022
Accounts receivable, net	$	96,867	$	101,616	$	184,102
Deferred revenues		14,881		17,585		17,518
Customer deposits		16,319		16,955		17,707
Costs to obtain and fulfill a contract	$	1,485	$	1,674	$	2,328

had been deferred as of January 1, 2022. We recognized revenue of $16.5 million during the year ended December 31, 2022 that had been deferred as of January 1, 2022.

Performance Obligations

We include reimbursements from customers, such as postage costs, in revenue, while the related costs are included in cost of revenue.

Transaction Price Allocated to the Remaining Performance Obligations


Estimated Remaining Fixed Consideration for Unsatisfied Performance Obligations

Remainder of 2023	$	10,169
2024		35,699
2025		30,338
2026		3,663
2027		2,041
2028 and thereafter		1,226
Total	$	83,136

Stockholders' Equity - Common Stock (Details)	9 Months Ended
Stockholders' Equity - Common Stock (Details)	Sep. 30, 2023 Vote shares	Dec. 31, 2022 shares
Common Stock
Common Stock, shares authorized	1,600,000,000	1,600,000,000
Number of voting rights entitled for each share of Common Stock held \| Vote	1
Common stock, shares outstanding	6,365,353	1,393,276

Employee Benefit Plans - Pension Expense (Details) - USD ($) $ in Thousands	3 Months Ended		9 Months Ended
	Sep. 30, 2023	Sep. 30, 2022	Sep. 30, 2023	Sep. 30, 2022
Net periodic benefit cost
Employer contributions			$ 1,900	$ 1,900
Pension
Net periodic benefit cost
Service cost	$ 10	$ 15	30	45
Interest cost	$ 766	$ 486	$ 2,275	$ 1,458
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Interest Cost, Statement of Income or Comprehensive Income [Extensible Enumeration]	Interest Income (Expense), Nonoperating, Net	Interest Income (Expense), Nonoperating, Net	Interest Income (Expense), Nonoperating, Net	Interest Income (Expense), Nonoperating, Net
Expected return on plan assets	$ (682)	$ (724)	$ (2,025)	$ (2,172)
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Expected Return (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)
Amortization of prior service cost	$ 89	$ 53	$ 266	$ 159
Defined Benefit Plan, Net Periodic Benefit Cost (Credit), Amortization of Prior Service Cost (Credit), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)
Amortization of net loss	$ 395	$ 646	$ 1,171	$ 1,938
Defined Benefit Plan, Net Periodic Benefit (Cost) Credit, Amortization of Gain (Loss), Statement of Income or Comprehensive Income [Extensible Enumeration]	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)	Other Nonoperating Income (Expense)
Net periodic benefit cost	$ 578	$ 476	$ 1,717	$ 1,428

Employee Benefit Plans

9 Months Ended

Sep. 30, 2023

Employee Benefit Plans

Employee Benefit Plans

7. Employee Benefit Plans

German Pension Plan

The Company’s subsidiary in Germany provides pension benefits to certain retirees. Employees eligible for participation include all employees who started working for the Company or its predecessors prior to September 30, 1987 and have finished a qualifying period of at least 10 years. The Company accrues the cost of these benefits over the service lives of the covered employees based on an actuarial calculation. The Company uses a December 31 measurement date for this plan. The German pension plan is an unfunded plan and therefore has no plan assets. No new employees are registered under this plan and the participants who are already eligible to receive benefits under this plan are no longer employees of the Company.

U.K. Pension Plan

The Company’s subsidiary in the United Kingdom provides pension benefits to certain retirees and eligible dependents. Employees eligible for participation include all full-time regular employees who were more than three years from retirement prior to October 2001. A retirement pension or a lump-sum payment may be paid dependent upon length of service at the mandatory retirement age. The Company accrues the cost of these benefits over the service lives of the covered employees based on an actuarial calculation. The Company uses a December 31 measurement date for this plan. No new employees are registered under this plan and the pension obligation for the existing participants of the plan is calculated based on actual salary of the participants as at the earlier of two dates, the participants leaving the Company or December 31, 2015.

Norway Pension Plan

The Company’s subsidiary in Norway provides pension benefits to eligible retirees and eligible dependents. Employees eligible for participation include all employees who were more than three years from retirement prior to March 2018. The Company accrues the cost of these benefits over the service lives of the covered employees based on an actuarial calculation. The Company uses a December 31 measurement date for this plan. No new employees are registered under this plan and the pension obligation for the existing participants of the plan is calculated based on actual salary of the participants as at the later of two dates, the participants leaving the Company or April 30, 2018.

Asterion Pension Plan

In April 2018, through its acquisition of Asterion International Group, the Company became obligated to provide pension benefits to eligible retirees and eligible dependents of Asterion. Employees eligible for participation include all full-time regular employees who were more than three years from retirement prior to July 2003. A retirement

pension or a lump-sum payment may be paid dependent upon length of service at the mandatory retirement age. The Company accrues the cost of these benefits over the service lives of the covered employees based on an actuarial calculation. The Company uses a December 31 measurement date for this plan. No new employees are registered under this plan and the pension obligation for the existing participants of the plan is calculated based on actual salary of the participants as at the earlier of two dates, the participants leaving the Company or April 10, 2018.

Tax Effect on Accumulated Other Comprehensive Loss

As of September 30, 2023 and December 31, 2022 the Company recorded actuarial losses of $3.6 million and $3.6 million in accumulated other comprehensive loss on the condensed consolidated balance sheets, respectively, which is net of a deferred tax benefit of $2.0 million for each period.

Pension Expense

The components of the net periodic benefit cost are as follows:


	Three Months Ended September 30,				Nine Months Ended September 30,
	2023		2022		2023		2022
Service cost	$	10	$	15	$	30	$	45
Interest cost		766		486		2,275		1,458
Expected return on plan assets		(682)		(724)		(2,025)		(2,172)
Amortization:
Amortization of prior service cost		89		53		266		159
Amortization of net loss		395		646		1,171		1,938
Net periodic benefit cost	$	578	$	476	$	1,717	$	1,428

The Company records pension interest cost within interest expense, net. Expected return on plan assets, amortization of prior service costs, and amortization of net losses are recorded within other expense (income), net. Service cost is recorded within cost of revenue.

Employer Contributions

The Company’s funding of employer contributions is based on governmental requirements and differs from those methods used to recognize pension expense. The Company made contributions of $1.9 million and $1.9 million to its pension plans during the nine months ended September 30, 2023 and 2022, respectively. The Company has funded the pension plans with the required contributions for 2023 based on current plan provisions.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 55
-Paragraph 17
-URI https://asc.fasb.org/extlink&oid=123450688&loc=d3e4179-114921

Reference 2: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section S99
-Paragraph 2
-URI https://asc.fasb.org/extlink&oid=21916913&loc=d3e273930-122802

Reference 3: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (d)(i)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 4: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (o)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 5: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (p)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 6: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 70
-Section 50
-Paragraph 1
-URI https://asc.fasb.org/extlink&oid=49170846&loc=d3e28014-114942

Reference 7: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-URI https://asc.fasb.org/topic&trid=2235017

Reference 8: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 60
-Section 50
-Paragraph 3
-Subparagraph (c)
-URI https://asc.fasb.org/extlink&oid=6414203&loc=d3e39689-114964

Reference 9: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (d)(iv)(03)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 10: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (q)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 11: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (r)(1)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 12: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (d)(iii)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 13: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (l)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

Reference 14: http://www.xbrl.org/2003/role/disclosureRef
-Publisher FASB
-Name Accounting Standards Codification
-Topic 715
-SubTopic 20
-Section 50
-Paragraph 1
-Subparagraph (r)(2)
-URI https://asc.fasb.org/extlink&oid=123447040&loc=d3e1928-114920

+ Details

Intangible Assets and Goodwill

9 Months Ended

Sep. 30, 2023

Intangible Assets and Goodwill

Intangible Assets and Goodwill

4. Intangible Assets and Goodwill

Intangible Assets

Intangible assets are stated at cost or acquisition-date fair value less accumulated amortization and consists of the following:


	September 30, 2023
	Gross Carrying		Accumulated		Intangible
	Amount (a)		Amortization		Asset, net
Customer relationships	$	507,675	$	(373,656)	$	134,019
Developed technology		88,553		(88,026)		527
Patent		15		(14)		1
Trade names (b)		8,400		(3,100)		5,300
Outsource contract costs		17,616		(16,131)		1,485
Internally developed software		55,107		(40,786)		14,321
Purchased software		26,749		(8,471)		18,278
Intangibles, net	$	704,115	$	(530,184)	$	173,931


	December 31, 2022
	Gross Carrying		Accumulated		Intangible
	Amount (a)		Amortization		Asset, net
Customer relationships	$	507,723	$	(351,240)	$	156,483
Developed technology		88,553		(88,000)		553
Patent		15		(6)		9
Trade names (b)		8,400		(3,100)		5,300
Outsource contract costs		17,184		(15,509)		1,675
Internally developed software		52,441		(35,095)		17,346
Purchased software		26,749		(7,133)		19,616
Intangibles, net	$	701,065	$	(500,083)	$	200,982

(a)	Amounts include intangible assets acquired in business combinations and asset acquisitions.

(b)	The carrying amount of trade names for 2023 and 2022 is net of accumulated impairment losses of $44.1 million. Carrying amount of $5.3 million as at September 30, 2023 represents indefinite-lived intangible assets.

Goodwill

Goodwill by reporting segment consists of the following:




	Balances as at January 1, 2023 (a)			Additions		Deletions			Impairments		Currency Translation Adjustments		Balances as at September 30, 2023 (a)
ITPS	$	81,151	$	—	$	(16,500)	(b)	$	—	$	(40)	$	64,611
HS		86,786		—		—			—		—		86,786
LLPS		18,865		—		—			—		—		18,865
Total	$	186,802	$	—	$	(16,500)		$	—	$	(40)	$	170,262

	Balances as at January 1, 2022 (a)			Additions		Deletions			Impairments		Currency Translation Adjustments		Balances as at December 31, 2022 (a)
ITPS	$	252,672	$	—	$	—		$	(171,182)	$	(339)	$	81,151
HS		86,786		—		—			—		—		86,786
LLPS		18,865		—		—			—		—		18,865
Total	$	358,323	$	—	$	—		$	(171,182)	$	(339)	$	186,802

(a)

(b)	The deletion in goodwill is due to derecognition of allocated goodwill on sale of the high-speed scanner business in the second quarter of 2023. Refer to Note 1—General.