System1, Inc.SST
System1, Inc. Debt Disclosure
Debt, Net
We entered into a term loan ("Term Loan") and revolving facility ("Revolving Facility" and, together with the Term Loan, "Credit Agreement") with Bank of America, N.A., on January 27, 2022, providing for a 5.5 year term loan with a principal balance of $400.0 million and with the net proceeds of $376.0 million. The Revolving Facility provided for borrowing availability of up to $50.0 million. As of December 31, 2025, there was principal of $260.1 million outstanding on the Term Loan. Through December 31, 2025, $5.0 million of the Term Loan is payable quarterly. From March 31, 2026, $7.5 million of the Term Loan is payable quarterly. The Term Loan matures in July 2027.
For every interest period, the interest rate on the Term Loan is the adjusted Secured Overnight Financing Rate ("SOFR") plus 4.75%. The Term Loan is amortized in quarterly installments on each scheduled payment date. The Term Loan comes with a leverage covenant, which goes into effect only if the utilization on the Revolving Facility exceeds 35% of the $50.0 million Revolving Facility at each quarter-end starting the second quarter 2022, such that the first lien leverage ratio (as defined in the credit agreement) should not exceed 5.40. The Credit Agreement has certain financial and nonfinancial covenants, including the "springing" leverage ratio covenant. The Credit Agreement also requires that we deliver our audited consolidated financial statements to our lender within 120 days of our fiscal year end, December 31. Should we fail to distribute the financial statements to our lender within 120 days, we are allowed an additional 30 days to cure. We were in compliance with the financial covenants under the Term Loan as of December 31, 2025.
The interest rate on the Revolving Facility is the adjusted SOFR plus 2.5% with an adjusted SOFR floor of 0%. During 2024 we did not have any borrowings from the Revolving Facility and as of December 31, 2024 we had $50.0 million available on the Revolving Facility. During the fourth quarter of 2025, we borrowed $50.0 million under the Revolving Facility and the balance outstanding at December 31, 2025 was $50.0 million, presented within current liabilities. We were in compliance with the financial covenants under the Revolver Facility as of December 31, 2025.
Reorganization
On August 1, 2024, we undertook a corporate reorganization, the result of which was that all of the assets and business operations of the Company are now held by System1 Holdings, LLC ("System1 Holdings"), a newly formed intermediate holding company of which we maintain the controlling interest and in which the non-controlling interest is owned by the holders of our Class C common stock. Following the corporate reorganization, (a) System1 Holdings now owns 100% of S1 Holdco, LLC ("S1 Holdco"), the previous intermediate holding company with the non-controlling interests, and 100% of S1 Media, LLC (“S1 Media”), another new subsidiary formed in connection with the corporate reorganization, (b) S1 Media holds the assets and business operations associated with our Products businesses, which include CouponFollow, Startpage and MapQuest, and our acquisition marketing platform and (c) S1 Holdco holds our assets related to our Marketing businesses. System1 Holdings holds our remaining assets and business operations. S1 Holdco and its subsidiaries remain obligors and guarantors under our Term Loan and Revolving Facility, and System1 Holdings and S1 Media are not parties thereto.
The carrying values of our debt, net of discounts, deferred financing and debt issuance costs were as follows (in thousands):
December 31, 2025 | December 31, 2024 | ||||||||||
Term Loan1,2 | $ | 255,117 | $ | 271,523 | |||||||
Revolving Facility | 50,000 | — | |||||||||
Total debt, net | $ | 305,117 | $ | 271,523 | |||||||
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1 Includes unamortized discount of $4.7 million and $8.1 million, and unamortized loan fees of $0.3 million and $0.4 million, as of December 31, 2025, and December 31, 2024, respectively, recorded as a reduction of the carrying amount of the debt and amortized to interest expense using the effective interest method. | |||||||||||
2 Estimated fair value of the Term Loan was $192.5 million as of December 31, 2025. | |||||||||||
During 2024, we completed the repurchase of $64.9 million in principal amount of our Term Loan for an aggregate purchase price of $41.6 million (at discount of 64.12% of its par value). We used available cash on hand to fund the repurchases. Our gain on the repurchase was approximately $20.1 million before fees and expenses incurred. There were no repurchases of principal of our Term Loan during 2025.
As of December 31, 2025, future minimum principal payments on long-term debt were as follows (in thousands):
2026 | $ | 30,000 | |||
2027 | 230,090 | ||||
Total future minimum principal payment | 260,090 | ||||
Less: current portion | (30,000) | ||||
Long-term portion | $ | 230,090 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 11, 2026 | Showing above |
| 2024 | Mar 10, 2025 | |
| 2023 | Mar 15, 2024 | |
| 2022 | Jun 6, 2023 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.