v3.26.1
Sale of Assets
3 Months Ended
Mar. 31, 2026
Discontinued Operations and Disposal Groups [Abstract]  
Sale of Assets

3. Sale of Assets

On March 31, 2025, Quest entered into an asset purchase agreement (the “APA”) with Lincoln Waste Solutions, LLC, a Connecticut limited liability company (“Purchaser”), and completed the sale to Purchaser of substantially all of the assets used in Quest’s divested business operations as set forth in the APA (the “Transaction”). The selling price of the assets was approximately $5.0 million in cash plus (i) additional amounts, not to exceed $6.5 million, based on the future performance of the contracts sold over the three years following the date of sale (collectively, the “Milestone Payments”) and (ii) a one-time payment based on the Purchaser’s ability to collect the accounts receivable and other monies due for sales and delivery of goods, performance of services and other business transactions, subject to certain other adjustments as set forth in the APA. The APA also includes clawback provisions, not to exceed $5.0 million, to be applied against the receipt of any future Milestone Payments if certain metrics were not met within the first four months of the date of sale. As of March 31, 2026, we do not believe that estimated contingent proceeds due to us, net of amounts owed to the Purchaser, will have a material effect on our business, financial condition, results of operations, or cash flows.

In connection with the sale of the assets, we recognized a $4.4 million loss on sale of assets in the three months ended March 31, 2025 based on the carrying value of sold assets classified as held for sale at December 31, 2024. We will adjust the purchase price as the Milestone Payments net of clawback adjustments become reasonably estimable. The cash proceeds received at the time of sale were used to repay debt as further discussed in Note 8, Notes Payable and Other Long-Term Liabilities.

During the quarter ended March 31, 2026, we entered into a sale leaseback agreement with a third party for certain compactor and related equipment. We recognized a gain on sale of approximately $11 thousand on these equipment sales.