(24) RECAPITALIZATION TRANSACTIONS

On April 30, 2026 (the “Closing Date”), the Company completed a recapitalization transaction to enhance the Company’s financial position and financial flexibility by significantly reducing and extending its indebtedness. The recapitalization was effected through a combination of new debt financing, settlement of existing indebtedness, and private placement of equity interests and warrants (collectively, the “Recapitalization Transaction”).

Under the Recapitalization Transaction, the Company entered into a new Credit Agreement, dated as of April 30, 2026 (the “Credit Agreement”), by and among the Company, as borrower, Chatham Capital Management, LLC, as administrative agent for the Lenders (the “Agent”). Pursuant to the Credit Agreement, the Lenders extended a credit facility in the maximum aggregate principal amount of $24.0 million, consisting of (a) a term loan (the “Term Loan”) in the principal amount of $21.0 million, which was funded in full on April 30, 2026, (b) a revolving line of credit in the principal amount of $2.0 million and (c) an interest line loan facility (the “Interest Line Loan Facility”) in the principal amount of $1.0 million. The Credit Agreement has a maturity date of April 30, 2031.

In connection with the Recapitalization Transaction, the Company and Conrent Invest S.A., acting on behalf of its compartment, “Safety 2” (“Conrent”), entered into an Amended Facility Payoff Agreement (“Payoff Agreement”). Pursuant to the Payoff Agreement, the Company agreed to pay $23.52 million to Conrent in settlement of the outstanding $42.864 million unsecured debt facility.

Additionally, the Company entered into Securities Purchase Agreement (the “Purchase Agreement”) with certain accredited investors for the private placement (the “Private Placement”) of (i) 29,471,429 shares of the Company’s common stock, par value $0.0001 per share (“Common Stock”) (the “PIPE Shares”) at a price per PIPE Share of $0.35, and (ii) 750,000 warrants to purchase shares of Common Stock (the “PIPE Warrants”), for aggregate gross proceeds of approximately $10.3 million.

In connection with the Recapitalization Transaction, the Board has been reconstituted with new directors with deep collective experience in community corrections, capital markets, M&A, capital allocation, and corporate governance. The Company has appointed Denver Smith, CFA, as Chairman of the Board. Additional board members include Kyle Kidd, CPA, Matthew Powalski, CPA, Jacob Saour, John “Rocky” Sullivan, and Derek Cassell, current CEO. Legacy directors have stepped down as part of the transition. Current management will continue to lead day-to-day operations and execute on the Company’s strategic plan.

See Notes 18 and 20 for additional information.