NOTE 6.  NOTES PAYABLE

Notes payable consisted of the following as of December 31, 2025 and 2024:

Credit Agreements – First Citizens Bank

On February 23, 2023, the Company entered into an Amended and Restated Credit Agreement (the “2023 Credit Agreement”) with First Citizens Bank, amending and restating that certain Credit Agreement, dated September 24, 2019, between the Company and the Bank. Pursuant to the 2023 Credit Agreement, the Bank provided the Company with a term loan for the principal amount of $12,500 (“Term Loan A”), and a revolving line of credit of $3,500 (the “Line of Credit”, and collectively with Term Loan A, the “Loan”). The Company used the proceeds from the Loan to fund the acquisition of MRC and for general working capital purposes.

Second Amended and Restated Credit Agreement

On October 10, 2023, the Company entered into a Second Amended and Restated Credit Agreement (the “Prior Credit Agreement”) with the Bank, amending and restating the 2023 Credit Agreement between the Company and the Bank. Pursuant to the Prior Credit Agreement, the Bank provided the Company with an additional term loan (“Term Loan B”, and together with Term Loan A, the “Term Loans”) for the principal amount of $10,000 and extended the Line of Credit of $3.5 million to December 23, 2024. The Company used the proceeds from Term Loan B to fund the acquisition of the MusclePharm assets and for general working capital purposes.

First Amendment to Second Amended and Restated Credit Agreement

On December 19, 2024, the Company entered into the First Amendment to the Prior Credit Agreement (the “Amended Prior Credit Agreement”) to extend the Line of Credit to April 30, 2026.

Term Loans A and B – Pursuant to the Amended Prior Credit Agreement, the Term Loans accrued interest at a per annum rate equal to the greater of 3.50% or 2.75% above the one-month secured overnight financing rate ("SOFR") published for such day by the Federal Reserve Bank of New York. The Company was required to make quarterly payments of principal plus accrued interest on the Term Loans until the principal balances were fully amortized. Quarterly principal payments for Term Loan A and Term Loan B were $625 and $500, respectively. The Company was permitted to prepay amounts borrowed under the Term Loans, in whole or in part, with accrued interest to the date of such prepayment on the amount prepaid, by written notice to Bank at least one business day prior to the proposed prepayment.

Line of Credit – Also pursuant to the Amended Prior Credit Agreement, outstanding advances under the Line of Credit (“Advances”) accrued interest at a per annum rate equal to the greater of 3.50% or 2.75% above the one-month SOFR, and the Company paid the interest on the Advances monthly, with all principal and any accrued interest on outstanding Advances being due and payable in full on the Line of Credit maturity date. The Company was permitted to prepay amounts borrowed under the Line of Credit, in whole or in part with accrued interest to the date of such prepayment on the amount prepaid, by written notice to Bank at least one business day prior to the proposed prepayment. 

Credit Agreement

On August 8, 2025 (the “Closing Date”), the Company entered into a Loan, Security and Guarantee Agreement (the “Credit Agreement”) with the Bank. Pursuant to the Credit Agreement, the Bank provided the Company with a five-year term loan in the amount of $40,625 (“Irwin Term Loan”) and a three-year revolving line of credit of up to $10,000 (the “Credit Line”, and collectively with the Irwin Term Loan, the “Loan”). The Company used (i) $29,750 from the Irwin Term Loan to complete the purchase of substantially all of the assets of Irwin (see Note 8); and (ii) $10,875 to pay off, retire and replace the outstanding balance of the Term Loans as of the Closing Date.

Pursuant to the Credit Agreement the Loan accrues interest at a per annum rate equal to 2.5% to 3.0%, based on leverage, above SOFR published by the Federal Reserve Bank of New York for the applicable selected interest period of one, three or six months (SOFR plus the aforementioned margin or the “Applicable Rate”). The Company began making quarterly payments of principal plus accrued interest on the Irwin Term Loan on December 31, 2025. Principal payments of $1,523 will be made for the next seven quarterly payment dates through September 30, 2025, and $2,031 for each quarterly payment thereafter, in each case plus accrued interest. All remaining principal and accrued interest on the Irwin Term Loan will be due and payable in full on August 8, 2030.

Outstanding advances under the revolving line of credit will accrue interest at the Applicable Rate, and the Company shall make payments of accrued interest on such advances at the end of each interest period and on the repayment of any advance with all remaining principal and accrued interest on the advances being due and payable in full on August 8, 2028.

The Credit Agreement contains customary affirmative and negative covenants, including, without limitation, financial covenants: (i) to maintain a Senior Funded Debt to EBITDA Ratio (as defined in the Credit Agreement) of not more than 2.75 to 1.00 as tested quarterly on a trailing twelve-month basis, starting with the fiscal quarter ending December 31, 2025 and ending with the fiscal quarter ended June 30, 2026 and a Senior Funded Debt to EBITDA Ratio (as defined in the Credit Agreement) of not more than 2.50 to 1.00 as tested quarterly on a trailing twelve-month basis, starting with the fiscal quarter ending September 30, 2026; and (ii) to maintain a Fixed Charge Coverage Ratio (as defined in the Credit Agreement) of at least 1.25 to 1.00 as tested on the last day of each fiscal quarter, commencing with the quarter ending December 31, 2025.

To secure satisfaction of the Obligations, pursuant to the Credit Agreement, (i) NDS Nutrition Products, Inc., iSatori, Inc., MP Acquisition Corp., and IN Acquisition Corp. (collectively, the “Subsidiaries”) guaranteed the satisfaction of the Obligations by the Company in favor of the Bank and (ii) each of the Subsidiaries and the Company granted a security interest in substantially all of their respective assets in favor of the Bank.

The borrowings outstanding on term loans were $39,102 and $13,125 as of December 31, 2025 and 2024, respectively.

The borrowings outstanding on the line of credit were $5,600 and $0 as of December 31, 2025 and 2024, respectively.

Maturities of the Company's Term Loans are as follows: