NOTE 7 - LOANS PAYABLE AND FINANCING AGREEMENTS

Promissory Notes Payable

Novo Note

The Company issued a promissory note for $3.0 million pursuant to the Novo Group acquisition agreement dated August 27, 2021. The note originally had a term of 30 months, bears interest at 6%, and was scheduled to mature on February 1, 2024. The note requires monthly payments of $85 thousand for the first 12 months, $110 thousand for months 13 through 24, $155 thousand for months 25 through 29, and $152 thousand for month 30. In April 2022, the Company negotiated a reduction in this promissory note with Novo Group due to employee turnover that occurred following the acquisition. The Company entered into an agreement with Novo Group to reduce the outstanding principal balance by $600 thousand and changed the maturity date to November 1, 2023. The reduction in the promissory note was accounted for as gain on debt extinguishment on the consolidated statement of operations in the year ended December 31, 2025.

In October 2022, Novo Group entered into a Subordination Agreement (“Subordination Agreement”), pursuant to which Novo agreed to subordinate all its indebtedness and obligations that the Company owes to Novo to all the indebtedness and obligations the Company owes to Montage Capital.

In February 2023, the Company entered into an additional Amendment to the Promissory Note with Novo Group, Inc. (the “Novo Amendment”). The Novo Amendment further modifies the Promissory Note issued to Novo on August 27, 2021 (the “Novo Note”) and amended on April 1, 2022, by amending the payment schedule pursuant to which the Company would make payments of principal and interest to Novo. Novo agreed the Company would pay interest only for the period starting November 1, 2022, though and including March 31, 2023, with payments of principal and interest to resume starting April 1, 2023. The Company also replaced the existing payment schedule with a new payment schedule terminating on October 31, 2023. On November 1, 2023, the Company did not make payments due on the promissory note with Novo Group.

On August 12, 2025, the debt holders of the Novo Note and the Company entered into a Debt Conversion Agreement whereas the parties have agreed to the complete conversion of all outstanding debt principal, accrued interest, and any penalties into shares of common stock of the Company at a conversion price of $2.00 per share of common stock. As of August 12, 2025, there was $1.2 million of outstanding principal and $298 thousand of accrued interest, which were converted into an aggregate of 748,433 shares of common stock. As of March 31, 2026, 746,488 shares had been issued, with the remaining 1,945 shares planned to be issued at a future date.

As of March 31, 2026, and December 31, 2025, the outstanding balance on the promissory note with Novo Group was $0.

Montage Note

On October 19, 2022, the Company closed a Loan and Security Agreement (the “Loan Agreement”), by and among the Company and Montage Capital II, L.P. (the “Lender”). Pursuant to the Loan Agreement, the Lender will make advances (“Advances”) in the aggregate principal amount of $2.3 million, with the first Advance of $2.0 million being provided on or around the Closing Date and the second Advance of $250 thousand being available to the Company upon request prior to April 30, 2023. Interest will accrue on all Advances under the Loan Agreement at a per annum rate of 12.75%. In the event of a default under the terms of the Loan Agreement, the interest rate increases by 5 percentage points above the interest rate in effect immediately prior to a default. The entire outstanding principal balance of the Advances, all accrued and unpaid interest thereon, and all fees and other amounts outstanding thereunder will be immediately due and payable on the 42nd month anniversary of the Closing Date (the “Maturity Date”). In connection with the Loan Agreement, the Company granted and pledged to the Lender a continuing security interest in all presently existing and hereafter acquired or arising Collateral (as more specifically defined in the Loan Agreement) which includes all personal property of the Company and its subsidiaries. The Loan Agreement contains certain affirmative and negative covenants to which the Company is also subject.

The Company agreed to pay the Lender a fee of $46 thousand, with $40 thousand due upon the execution of the Loan Agreement and the balance due upon the funding of the second Advance. The Company is permitted to prepay any amounts due to the Lender; provided, however, that a Prepayment Fee (as more specifically defined in the Loan Agreement) shall be owed to the Lender depending on when the amounts are prepaid.

In addition, in connection with the Loan Agreement, the Company issued 47,103 warrants to purchase common stock of the Company (the “Warrants”) to the Lender, with 41,520 Warrants issued and exercisable upon the Closing Date and the additional 5,580 Warrants becoming exercisable upon funding of the second Advance. The Warrants are exercisable for ten years from the Closing Date at an exercise price of $30.00 per share, subject to certain adjustments. Upon the earlier of the Maturity Date or a sale of the Company or other change in control, the Lender has the right to cause the Company to repurchase the Warrants for up to $703 thousand ($600 thousand if only the first Advance has been made and $703 thousand if both Advances have been made) which is recorded as a warrant liability for puttable warrants at fair value. The Company is also obligated to pay the Lender a cash fee equal to 1.25% of the aggregate principal amount of the Advances that is outstanding on each anniversary of the Closing Date if (i) the average closing price of the Company’s common stock for the thirty (30) day period prior to such anniversary date is less than $30.00 or (ii) the closing price of the Company’s common stock for the date immediately prior to such anniversary date is less than $30.00.

The Company accrues anniversary fees each year on the one-year anniversary of the issuance date of 1.25% of the outstanding advance balance depending on the stock price. The accrued anniversary fees are payable on the date the buyout fee becomes due and payable. The Company records an expense for the 1.25% cash fee ratably over the 12 months.

On February 2, 2023, the Company entered into a First Amendment to Loan and Security Agreement (the “Montage Amendment”), by and between the Company, its subsidiaries and Montage, effective as December 18, 2022. The Montage Amendment modifies that certain Loan and Security Agreement by and among the Company, its subsidiaries, and Montage to provide the Company with additional time to meet certain post-closing covenants.

On August 16, 2023, the Company entered into a Second Amendment to Loan and Security Agreement (the “Second Montage Amendment”), by and among the Company, its subsidiaries and Montage. The Second Montage Amendment modifies that certain Loan and Security Agreement by and among the Company, its subsidiaries, and Montage, as amended (the “Loan and Security Agreement”) to join CognoGroup, Inc. as an additional borrower to the Loan and Security Agreement and amend and restate the definition of “Maturity Date” to the earlier of (i) the four-month anniversary of the initial closing of the Purchase Agreement or (ii) February 28, 2024. Additionally, the Montage Amendment provides for Montage’s consent to certain transactions that would have otherwise been prohibited under the Loan and Security Agreement, including the transaction contemplated by the Purchase Agreement with Job Mobz.

In addition, in connection with the Second Montage Amendment, the Company issued warrants to purchase common stock of CognoGroup, Inc. (the “CognoGroup, Inc. Warrants”) to the Lender. The number of shares shall be equal to 1.4% of the CognoGroup, Inc.’s outstanding capital stock on a fully diluted basis at the exercise price of $0.01 per share and with expiration date of October 19, 2032. On and after the earlier to occur of (i) October 19, 2026, (ii) any sale, license, or other disposition of all or substantially all of the assets of the CognoGroup, Inc., or any reorganization, consolidation, or merger of the CognoGroup, Inc. where the holders of the CognoGroup, Inc.’s securities before the transaction beneficially own less than 50% of the outstanding voting securities of the surviving entity after the transaction, (iii) a transaction in which any “person” or “group” becomes the “beneficial owner” (as defined in Rule 13d-3 under the Securities Exchange Act of 1934), directly or indirectly, of a sufficient number of shares of all classes of stock then outstanding of the CognoGroup, Inc. ordinarily entitled to vote in the election of directors, empowering such “person” or “group” to elect a majority of the Board of Directors of the CognoGroup, Inc., who did not have such power before such transaction (“Change in Control”), or (iv) the dissolution or liquidation of the CognoGroup, Inc (“Wind-Up”), CognoGroup, Inc. shall, at the request of Holder, purchase all rights that Holder has under this CognoGroup, Inc. Warrants for a cash payment in the amount equal to $600 thousand (the “Buyout Fee”). These warrants were transferred to CognoGroup, Inc. as a part of the executed spin-off on December 30, 2025 and, as such, are not included on the balance sheet as of December 31, 2025.

Line of Credit

On September 4, 2025, the Company entered into a Convertible Line of Credit Agreement with Siwatex OÜ, a limited liability company incorporated in Estonia, effective on September 2, 2025. Under the Agreement, the Lender has agreed to make available to the Company a convertible revolving line of credit in the principal amount of up to $2 million, that may be used to provide working capital and general corporate purposes of the Company and its subsidiaries.

The Company may request advances under the Credit Line (“Drawdowns”) with a minimum increment of $50 thousand each, and subject to a monthly maximum withdrawal amount that shall not exceed $500 thousand. Borrowings under the Agreement will bear interest at a fixed annual rate of 8.25%. Interest is payable quarterly in arrears, beginning 90 days after the first Drawdown, and thereafter every 90 days, with a final interest payment due twelve (12) months from the Effective Date (the “Maturity Date”).

Under the Agreement, the Lender may convert any amount of interest or principal borrowed under the Agreement into shares of the Company’s common stock, par value $0.0001, at a price per share no lower than $2.00 per share (any such shares, the “Conversion Shares”), with such price to only be increased under mutual agreement of the parties. Under the Agreement, if the Company files a registration statement with the Securities and Exchange Commission, the Company will, at the Lender’s request, include any Conversion Shares in such registration statement.

Unless previously converted, all outstanding amounts shall be repaid on the Maturity Date. The Company may extend the Maturity Date by an additional twelve (12) months, subject to an extension fee of one percent (1%) or two percent (2%) of the outstanding principal balance as of the Maturity Date. The Company may terminate the Agreement, in whole or in part, at any time and for any reason, upon ten (10) Business Days’ prior written notice to the Lender.

As of March 31, 2026, and December 31, 2025, the outstanding principal balance on the line of credit payable totaled $1.0 million and $775 thousand, respectively.

D&O Insurance Loan

On December 28, 2025, the Company entered into a premium financing agreement for a director's and officer's insurance policy, in which the Company received lending terms and funding. The policy is for a twelve month period and has an original principal amount of $56 thousand with an interest rate of 9.2%. During the three months ended March 31, 2026, the policy was modified to increase the original principal amount to $83 thousand.

As of March 31, 2026 and December 31, 2025, the outstanding principal balance on the insurance loan totaled $66 thousand and $56 thousand.