v3.26.1
Debt
 3 Months Ended
Mar. 31, 2026
Debt Disclosure [Abstract]  
Debt
Note 8: Debt
Some of the Company’s debt obligations consist of joint and several liabilities with the Company’s previous parent which are accounted for under ASC 405-40. Lyneer will remain jointly and severally liable with the IDC to the lenders of the debt obligations until such time as such joint and several indebtedness is restructured. As of the date of the Merger, the Company derecognized the joint and several liabilities with regard to the Debt Allocation Agreement, dated December 31, 2023, between Lyneer and IDC. See below for further information.
The table below provides a summary of the Company’s recognized debt:
March 31,
2026		December 31,
2025
Revolver$45,271,994 $49,454,401 
Credit Agreement1,950,000 1,950,000 
Promissory Note— 1,375,000 
Merger Note28,943,615 28,943,615 
Convertible Note161,961,751 — 
Factoring debt205,981,176 3,266,445 
Acquisition loans51,784,958 — 
Seller loans19,182,675 — 
Less: unamortized debt issuance costs
(1,904,052)(324,421)
Total debt$513,172,117 $84,665,040 
Current portion$468,515,500 $55,838,759 
Non-current portion$44,656,617 $28,826,281 
On April 29, 2025, the Company closed on a new revolving credit facility with a maturity date of April 29, 2028. See below for further information.
Debt Allocation Agreement
Lyneer and IDC entered into a debt allocation agreement (the “Allocation Agreement”) dated as of December 31, 2023, which specifies and allocates responsibility for repaying (or refinancing) the joint-and-several debts between Lyneer and IDC. The Allocation Agreement, which continues to be a valid and enforceable contract between Lyneer and IDC, states that repayment (or refinancing) of the Term Note, Seller Notes and Earnout Notes was assumed by and the responsibility of IDC. In the event IDC cannot repay any of the assumed debt and Lyneer is require to make payments, IDC is obligated to repay Lyneer for amounts paid on IDC’s behalf. The Company reassessed its accounting for joint-and-several liabilities under ASC 405-40 as of March 31, 2026 and concluded it is reasonably probable that IDC can repay their portion of the debt allocated per the Allocation Agreement and the Company does not expect to repay additional amounts on behalf of IDC. As a result, the Company has not recorded any liability related to these joint and several debt obligations in accordance with ASC 405-40. See Revolver (discussing the previous BMO Revolver), Term Note, Seller Notes and Earnout Notes below for those joint-and-several debts that are applicable to the Allocation Agreement. At March 31, 2026, such indebtedness totaled approximately $70,035,397.
Revolver
The Company maintained a Revolver with BMO Bank, N.A. (“BMO” and “BMO Revolver”) as a co-borrower with its former parent company, IDC, with an initial available borrowing capacity of up to $125,000,000, when originally executed in 2022. The facility was partially used to finance the acquisition of Lyneer Investments by IDC in August 2021, with additional borrowing capacity available under the BMO Revolver to finance the Company’s working capital. All the Company’s cash collections and disbursements are currently linked with bank accounts associated with the Lender and funded using the Revolver. These borrowings are determined by the Company’s availability based on a formula of billed and unbilled accounts receivable as defined in the loan agreement.
On April 29, 2025, the Company’s subsidiary, Lyneer Staffing Solutions, LLC (“Lyneer”) entered into a Loan and Security Agreement (the “Loan Agreement”) with North Mill Capital, LLC (d/b/a SLR Business Credit (“SLR”)), providing for a $70 million (“Advanced Limit”) senior secured revolving credit facility (the “Revolver”). The Loan Agreement replaced Lyneer’s prior senior secured revolving credit facility provided by BMO. Lyneer’s previous lender entered into a term loan shortfall of $6,000,000 with IDC and Lyneer for IDC’s shortfall owed to BMO, plus a $1,000,000 exit fee. The $6,000,000 term loan and $1,000,000 exit fee are joint-and-several with IDC and is subject to IDC’s obligation under the Allocation Agreement with IDC discussed above. BMO also assumed 3,439,803 shares of Atlantic International Corp previously owned by IDC as collateral for the new term loan. The Company incurred $130,453 in
issuance costs and, according to ASC 470 — Debt (“ASC 470”), is deferring these costs and will amortize as an adjustment to interest expense over the remaining term using the effective interest method.
All the Company’s cash collections and disbursements are currently linked with bank accounts associated with the lender and funded using the Revolver. These borrowings are determined by the Company’s availability based on a formula of billed and unbilled accounts receivable as defined in the loan agreement.
The interest rate on the Revolver is calculated as 1.00% per annum above the Prime Rate, but not less than 5.75% per annum. The interest rate as of March 31, 2026 was 7.75% per annum.
The Revolver matures on April 29, 2028, unless the lender, at its option, in writing agrees to extend for a period of one year.
As of March 31, 2026, and December 31, 2025, the Company has recognized liability balances on the Revolver of $45,141,541, including $130,453 of unamortized deferred issuance costs and $49,308,253, including $146,148 of unamortized deferred issuances costs, respectively.
The Revolver contains certain customary covenants, including affirmative and negative covenants. On April 17, 2026, SLR notified the Company of certain defaults. See Note 20: Subsequent Events for further discussion.
Under the terms of the Revolver, the Company is prohibited from making dividends or distributions to owners who are not also co-borrowers on the Revolver.
Total available borrowing capacity on the Revolver as of March 31, 2026 was $4,760,718.
Term Note
On August 31, 2021, the Company and IDC as co-borrowers entered into a Term Note in the amount of $30,300,000. The proceeds of this loan were primarily used to finance the acquisition of Lyneer by IDC in August 2021. The Term Note matured on February 28, 2026, at which time all outstanding balances were due and payable. There were no scheduled principal payments on the Term Note prior to its maturity date. The Term Note is subordinated to the Revolver and bears an initial stated rate of 14% per annum, and currently has a default interest rate of 16%.
On August 12, 2024, the Company entered into the Tenth Amendment with its Term Note lender, under which the lender, waived all existing events of default as of the date of the agreement and agreed to forbear from exercising its rights and remedies with respect to such events of default under the Term Note through September 30, 2024. The Initial Capital Raise milestone and the uplisting milestone dates were subsequently extended to September 15, 2025, or later as agreed to between the parties. Due to the remaining amount outstanding from IDC on the BMO Revolver being converted to a term loan and the new Revolver taking first position, the terms of the Tenth Amendment were superseded by the terms of the Revolver.
As of both March 31, 2026, and December 31, 2025, the Company has derecognized the Term Note, as discussed above; therefore, the Company recognized liability balances on the Term Note of $0. The Term Note obligation is joint-and-several with IDC and is subject to IDC’s obligation under the Allocation Agreement with IDC discussed above.
On April 28, 2025, the Term Note lender foreclosed on IDC’s remaining 21,983,926 shares of Atlantic International Corp common stock (“IDC Shares”), after taking into consideration the shares assumed by BMO discussed above. This foreclosure was only related to IDC’s security provided to the lender under the Term Note and did not extend to the Company or its subsidiaries. The value of the IDC Shares on the day of the foreclosure was approximately $77,383,420 which far exceeded the liability due under the Term Note. As of this report, the IDC Shares are pending transfer to the Term Note Lender due to litigation between IDC and an unrelated third party creditor of IDC. The Company is reviewing the implications of the foreclosure on the Company’s obligations under the Term Note as the collateral received by the Term Note holders significantly exceeded the purported amounts due under the Term Note and the value of the securities is readily ascertainable. The Company believes the resolution of this matter will not have an impact on the Company’s financial position or results of operations.
Lyneer had recognized liability balances on the Term Note of $0 as of both March 31, 2026 and December 31, 2025. The Term Note is allegedly in default and the Company has sued the Term Note Lender.
The Term Note includes certain customary financial and non-financial covenants that the Company is required to comply with. The Term Note is allegedly in default and the Company has sued the Term Note Lender. See Note 11: Commitments and Contingencies and Note 20: Subsequent Events for discussion on lawsuits related to the Term Note.
Seller Notes
As part of the purchase price consideration for the Transaction, the Company and IDC as co-borrowers issued various Seller Notes to former owners totaling $15,750,000. Payments on the Seller Notes are due in quarterly installments of $1,575,000, and $3,150,000 due at their amended maturity date of April 30, 2024, and bear interest at an amended fixed rate of 11.25% per annum. Payments to Seller Notes debt holders are prohibited by the administrative agent of the previous lender under the BMO Revolver and the current Revolver. As provided in the inter-creditor agreement between SLR and the Seller Note holders, Lyneer is prevented from making payments and the Seller Note holder are prevented from accepting payments from Lyneer.
As of both March 31, 2026, and December 31, 2025, the Company has derecognized the Seller Notes, as discussed above; therefore, the Company recognized liability balances of $0. The Seller Notes obligation is joint-and-several with IDC and is subject to IDC’s obligation under the Allocation Agreement with IDC discussed above. The Seller Notes are currently in default, but the note holders can take no action pursuant to the inter-creditor agreement with SLR.
Earnout Notes
As contingent consideration milestones are met in connection with the membership interest purchase agreement (“Transaction Agreement”), the Company can elect to pay the obligation in cash or issue notes payable. During 2023, the Company and IDC as co-borrowers issued nine notes payable with an aggregate value of $13,494,133. Payments on each of the Earnout Notes were due in quarterly installments through their amended maturity date of January 31, 2025, and each note bears an amended stated interest rate of 11.25% per annum. On January 16, 2024, the Company and IDC as co-borrowers issued six notes payable with an aggregate value of $6,941,521. Payments on each of the Earnout Notes were due in quarterly installments through their maturity date of January 16, 2026, and each note bears interest at a rate of 6.25% per annum. The Company did not make principal and interest payments due to the notice received from the Revolver’s administrative agent of the lender restricting payments to other lenders and the interest rate was increased to the default rate of 11.25% for the January Earnout Notes.
Payments to any other debt holders are prohibited by the administrative agent of the previous lender under the BMO Revolver and the current Revolver. As provided in the inter-creditor agreement between SLR and the Earnout Note holders, Lyneer is prevented from making payments and the Earnout Note holders are prevented from accepting payments from Lyneer.
As of both March 31, 2026, and December 31, 2025, the Company has derecognized the Earnout Notes, as discussed above; therefore, the Company recognized liability balances of $0. The Earnout Notes obligation is joint-and-several with IDC and is subject to IDC’s obligation under the Allocation Agreement with IDC discussed above. The Earnout Notes are currently in default, but the note holders can take no action pursuant to the inter-creditor agreement with SLR.
Credit Agreement
On June 18, 2024, the Company entered into a secured bridge loan (“Credit Agreement”) in the principal amount of $1,950,000 at an interest rate of 5% per annum. The maturity date of the Credit Agreement was originally September 30, 2024. However, mandatory prepayments shall be made from the Initial Capital Raise, on the issuance of new debt or new equity interests, or upon a change of control. Conditions have not been met to make mandatory prepayments.
On July 22, 2024, the Company entered into an amendment to extend the maturity date of the Credit Agreement to June 18, 2026. On April 17, 2026, the lender notified the Company of certain defaults. See Note 20: Subsequent Events for further discussion.
Promissory Note
From April 29, 2019 to April 29, 2020, the Company entered into a series of non-convertible promissory notes (the “Promissory Notes”) with St. Laurent Investments LLC amounting to $1,375,000. The Promissory Notes had a one-year term, most recently extended through July 31, 2025 or a later date to be mutually agreed upon. The Promissory Notes bear interest accruing at the rate of 5% per annum, and increased to 10% for the period from August 1, 2024, through July 31, 2025. On January 23, 2026, the Company and St. Laurent entered into a Confidential Settlement Agreement pursuant to which the entire $1,375,000 principal amount of the Notes were paid in full on January 29, 2026. All interest and penalties in the amount of $757,805 were waived by St. Laurent.
Merger Note
In connection with the closing of the Merger, we issued to IDC the Merger Note in the principal amount of $35,000,000 with an original maturity date of September 30, 2024. The Merger Note does not bear interest and is not convertible prior to an event of default under the Merger Note. If an event of default should occur under the Merger Note, the Merger Note will bear interest at the rate of 7% per annum commencing upon the date of such event of default and will be convertible into shares of our common stock at a price per share that equals the lowest daily volume weighted-average price per share (“VWAP”) during the five trading days immediately preceding the date on which the applicable conversion notice is delivered to us, but not less than 80% of the price per share in our Initial Capital Raise, provided, however, that the number of shares of our common stock issuable upon conversion of the Merger Note will not exceed 19.99% of the number of our outstanding shares of common stock without shareholder approval. An event of default under the Merger Note may result in an additional event of default under the Revolver and our other indebtedness for borrowed funds.
On September 12, 2024 the Company entered into Amendment No 1 to the Convertible Promissory Note (“Amendment 1 to the Merger Note”) which extended the maturity date to the earlier of March 31, 2026 or the completion of at least a $40 million capital raise. Amendment 1 to the Merger Note was treated as a modification after the Company’s analysis according to ASC 470 and as such, the Company is deferring the $300,000 amendment fee and will amortize as an adjustment to interest expense over the remaining term using the effective interest method.
On April 29, 2025, the Company and IDC entered into an Amended and Restated Convertible Promissory Note which further extended the maturity date to the earlier of March 31, 2027 or the completion of at least a $40 million capital raise. Pursuant to the Amended and Restated Convertible Promissory Note, any amounts paid to BMO will be in satisfaction of this Note. The Company offset the December 31, 2025 balance related to the IDC receivable that was remaining on the BMO Revolver and rolled into the current Revolver as allowed per the Amended and Restated Convertible Promissory Note. See Note 16: Related Party Transactions for IDC’s gross and net offsetting receivables amounts. Below is presented the calculation of the net liability of the Merger Note, excluding unamortized deferred issuance costs as of December 31, 2025.
Gross AmountAmount OffsetNet Amount on Consolidating Balance Sheet
Merger Note$34,882,666 $(6,056,385)$28,826,281 
As of March 31, 2026, and December 31, 2025, the Company has recognized liability balances on the Merger Note of $28,849,748, including $93,867 of unamortized deferred issuance costs and $28,826,281, including $117,334 of unamortized deferred issuance costs, respectively.
Convertible Note
As discussed in Note 2: Merger and Acquisition, on January 23, 2026, in connection with the Circle8 Acquisition, the Company issued a Convertible Note to Axiom as a component of consideration transferred for the business. The Convertible Note has a stated principal amount of $161,961,751 and is non‑interest‑bearing. The Convertible Note matures twelve months from the issuance date, at which time the principal amount becomes payable in cash; however, the Convertible Note may be settled prior to this date through the issuance of shares of the Company’s Common Stock if a majority of the Company’s stockholders vote to approve this conversion. If the aforementioned stockholder approval is obtained, the Convertible Note will convert into an aggregate of 53,291,744 shares of the Company’s Common Stock. The number of shares issuable in settlement of the Convertible Note is fixed at inception and is not subject to variability, other than customary anti-dilution provisions for stock splits, stock dividends, and similar recapitalization events.
The Convertible Note was measured initially at fair value of $205,706,132 (53,291,744 shares valued at the Company’s closing stock price on the Circle8 Closing Date of $3.86) on the Circle8 Closing Date. The fair value of the Convertible Note exceeds the stated principal amount resulting in a substantial premium of $43,744,381. Accordingly, the Company recorded the Convertible Note as short-term debt at its stated principal amount of $161,961,751, with the substantial premium recorded as a component of additional paid-in-capital within permanent equity. Issuance costs incurred to issue the Convertible Note were de minimis and expensed when incurred.
The Convertible Note contains provisions that relate to certain defined events of default, including bankruptcy, change of control or liquidation, cessation of operations, or failure to satisfy certain covenants contained in the Acquisition Agreement. Upon the occurrence of an event of default, the holder may declare the entire outstanding principal amount immediately due and payable. In addition, in the event of a default, interest accrues on the outstanding principal amount at
a rate of 10% per annum from the date of the event of default until payment, together with any other amounts due under the Convertible Note. As of March 31, 2026, no events of default have occurred. The Company concluded the holder’s put option upon an event of default meets the definition of a derivative requiring bifurcation, however the fair value of such derivative was of nominal value.
Other than in the case of default, the Convertible Note does not provide the holder with one or more contingent redemption options.
As of March 31, 2026, the outstanding principal balance of the Convertible Note is $161,961,751, which reflects its carrying amount as of that date. The Company is accounting for the liability portion of the note using the stated interest rate of zero, accordingly no interest has been recognized for the quarter ended March 31, 2026. Due to the amount of the Company’s outstanding stock owned by the holder of the Convertible Note, the holder is a related party with respect to the Company and accordingly the Convertible Note is considered a note payable to a related party.
Factoring Debt
In connection with the Circle8 Acquisition, the Company assumed a receivables purchase agreement between Circle8 and Argentum Securities Ireland Plc (“Argentum”), which permits Circle8 to sell eligible billed and unbilled receivables to Argentum for cash proceeds in certain circumstances. This arrangement is akin to a revolving line of credit with a borrowing base of approximately 90% of Circle8’s eligible receivables and a borrowing capacity limit of €174.9 million approximately $201.1 million as of March 31, 2026). As of the acquisition date of January 23, 2026, Circle8 had previously borrowed up to the facility limit of €174.9 million (approximately $201.1 million as of March 31, 2026). The facility includes multiple financial and non-financial covenants, including an over-collateralization provision requiring Circle8 to maintain an eligible receivables balance greater than 1.1111 times the amount borrowed under the facility. The facility matures on the earlier of May 18, 2029, or (i) upon an event of default or (ii) if Argentum exercises a subjective acceleration clause, which would require the facility to be repaid within 85 days. The Company pays a facility fee to Argentum monthly which is recognized in “other expenses, gains and losses” on the unaudited condensed consolidated statements of operations and comprehensive loss. The Company can repay the facility at any time. The Company concluded that the facility, while legally described as a factoring agreement, does not qualify as a sale of a financial instrument under ASC Topic 860 — Transfers and Servicing, and continues to recognize receivables on the balance sheet and a liability recorded to reflect the consideration received. Circle8 was in compliance with all provisions of the facility as of March 31, 2026.
During 2025 and the first quarter of 2026, the Company entered into four agreements to sell future receivables which allows for the factoring of receivables.
•On October 1, 2025, the Company sold $3,150,000 of receivables and received cash proceeds of $2,500,000 less $50,000 in origination fees. The weekly payments are $62,500 and the imputed interest rate is 48.58%.
•On October 21, 2025, the Company sold $1,905,000 of receivables and received cash proceeds of $1,500,000 less $30,000 in origination fees. The weekly payments are $37,798 and the imputed interest rate is 50.61%.
•On January 23, 2026, the Company sold $1,250,000 of receivables and received cash proceeds of $1,000,000 less $10,000 in origination fees. The weekly payments are $24,802 and the imputed interest rate is 47.10%.
•On January 23, 2026, the Company also sold $2,500,000 of receivables and received cash proceeds of $2,000,000 less $20,000 in origination fees. The weekly payments are $48,077 and the imputed interest rate is 45.67%.
These four agreements have a good faith term of twelve months and also allow for a discounted repurchase price if the Company pays the cash proceeds back early.
On April 29, 2026, the Company refinanced the October agreements described above. See Note 20: Subsequent Events for further information.
As of March 31, 2026, and December 31, 2025, the Company has recognized liability balances on the factoring agreements of $205,933,405, including $47,771 of unamortized deferred issuance costs and $3,205,506, including $60,939 of unamortized deferred issuance costs, respectively.
Acquisition Loans
Swisslinx Acquisition Loan
In February 2023, Circle8 entered into a loan agreement with Luzerner Kantonalbank AG as Lender, for a credit facility of up to Fr.29,000,000 (approximately $36,285,000 as of March 31, 2026) to partially finance the acquisition of 100% of the shares in Swisslinx AG and Swisslinx International Ltd. The facility has a maturity date of June 30, 2028. The facility provides for fixed advances with 3 or 6 month terms, or fixed loans with 2 to 5 year terms. The minimum amount per fixed advance or loan is Fr.2,000,000 (approximately $2,502,000 as of March 31, 2026), with a maximum of 5 credit tranches. The facility was fully drawn down at inception, with no additional advances as of March 31, 2026. The interest rate consists of the Swiss Average Overnight Rate (“SARON”) plus an applicable margin based on the net debt ratio as of March 31 each reporting period. If the SARON rate is negative, a rate of 0.00% is used as the base rate.
As of March 31, 2026, the margin was 3.70% and the interest rate was 3.70%. As of March 31, 2026, the Company has a recognized liability balance on the Swisslinx acquisition loan of $28,890,147.
Seven Stars Acquisition Loan
On October 26, 2022, Circle8 entered into a credit agreement with Beechbrook Capital, LLP, to partially fund the acquisition of all outstanding shares in the capital of Seven Stars Holding B.V. and each of its subsidiaries. The agreement provides a credit facility (“Facility B”) in the aggregate amount of €15,000,000 (approximately $17,330,000 as of March 31, 2026), and an available Accordion Facility for up to €15,000,000 (approximately $17,330,000 as of March 31, 2026) of additional borrowing capacity as an increase to Facility B or, alternatively, an additional term facility on a pari passu basis with Facility B. The maturity date is October 26, 2027. The interest rate on Facility B consists of the three-month EURIBOR (“EURIBOR 3M”) plus a margin of 8.50%, per annum. The variable leg of the loan attached to the EURIBOR 3M rate resets each interest period, which is defined as three months. Interest payments became due on December 31, 2022, and each March 31, June 30, September 30, and December 31, thereafter. As of March 31, 2026, the interest rate was 10.53%. As of March 31, 2026, the Company has a recognized liability balance on the Seven Stars acquisition loan of $16,932,099.
Königstein Acquisition Loans
On April 26, 2023, Circle8 entered into a loan agreement with Sparkasse KölnBonn to finance a portion of the purchase price payable under a share purchase agreement for the acquisition of 80% of the shares outstanding in Konigstein Beratungsgesellschaft für EDV-Dienstleistungen GmbH. This loan agreement provided Circle8 with loans totalling up to €7,000,000 (approximately $8,087,000 as of March 31, 2026) in the following tranches:
Investment Loan A: Up to €4,500,000 (approximately $5,199,000 as of March 31, 2026) as an amortizing loan with payments of €250,000 (approximately $289,000 as of March 31, 2026) due at the end of each quarter, starting on December 30, 2023. The maturity date is March 31, 2028, with quarterly payments of €250,000 (approximately $289,000 as of March 31, 2026) The interest rate on the utilized amounts consists of the EURIBOR 3M, which resets quarterly, plus a margin of 3.20% per annum. As of March 31, 2026, the interest rate was 5.23%. As of March 31, 2026, the Company has a recognized liability balance on the Königstein Investment Loan A of $2,463,294.
Investment Loan B: Up to €2,500,000 (approximately $2,888,000 as of March 31, 2026) as a bullet loan, with payment in full due on the maturity date of September 30, 2028. The interest rate on the utilized amounts consists of the EURIBOR 3M, which resets quarterly, plus a margin of 3.60% per annum. As of March 31, 2026, the interest rate was 5.63%. As of March 31, 2026, the Company has a recognized liability balance on the Königstein Investment Loan B of $2,498,072.
The loan agreement stipulates that certain financial indicators in the form of annual financial statements are due no later than 180 days after the end of each financial year and no later than 45 days after the end of each quarter. Failure to submit these required reports timely constitutes a breach of financial indicators under the loan agreement, and will increase the corresponding margin of each loan by 1.50% per annum until such financial reports are submitted to the lender.
Seller Loans Entered into by Circle8
Swisslinx Seller Loan
In March 2023, Circle8 entered into a seller loan agreement with Swisslinx AG and Swisslinx International Limited to partially fund the acquisition of 100% of the shares in Swisslinx AG and Swisslinx International Limited. The agreement provided Circle8 with a loan of Fr.13,500,000 (approximately $16,891,000 as of March 31, 2026) with a maturity date of July 1, 2028. The interest rate is 5.00% per annum. Principal payments of Fr.3,623,569 (approximately $4,534,000 as of March 31, 2026) and interest payments are due annually. As of March 31, 2026, the Company has a recognized liability balance on the Swisslinx seller loan of $16,252,462. The Swisslinx seller loan is currently in default in the amount of
Fr.3,375,000 (approximately $4,223,000 as of March 31, 2026) due to litigation. See Note 11: Commitments and Contingencies for further information.
Fixed Today Seller Loan
In April 2022, Circle8 entered into a seller loan agreement with Payment Secured B.V. to partially fund the acquisition of 100% of the shares in Fixed Today Holding B.V. The agreement provided Circle8 with €2,000,000 (approximately $2,311,000 as of March 31, 2026). The Fixed Today seller loan had a maturity date of April 14, 2024.
As of March 31, 2026, the Company has a recognized liability balance on the Fixed Today seller loan liability of $2,299,600. The Fixed Today seller loan is currently in default in the amount of €2,000,000 (approximately $2,311,000 as of March 31, 2026).
Subsequent to the executed amendments of the Company’s debt obligations described herein, the future minimum principal payments on the Company’s outstanding debt are as follows:
 As of
March 31, 2026
Remainder of 2026$29,284,761 
2027417,660,542 
202868,130,866 
2029— 
2030— 
Thereafter— 
Total$515,076,169 
Interest Expense
Total interest expense is comprised of a cash and non-cash component as described in the debt arrangements above. The Company also incurred interest expense related to an agreement with a professional employer organization (“PEO”) which processes the payroll for the Company, related to the unpaid balance, at 1.5% per calendar month. On May 4, 2026, the PEO notified the Company it was in default and subsequently withdrew the notice of default on May 11, 2026. See Note 20: Subsequent Events for further discussion.
Additionally, the Company entered into an agreement with Citibank, N.A. (“Citibank”) on March 5, 2019, whereby Citibank purchases specific receivables and pays the invoices at the discounted amount and the Company incurs a discount charge equal to the Secured Overnight Financing Rate plus 0.75% to process the payments. The discount charged ranged from 4.71% to 4.83% for the three months ended March 31, 2026.
The Company recognized total interest expense of $3,554,670 and $1,284,822 during the three months ended March 31, 2026 and 2025, respectively. Interest expense related to the PEO was $1,018,013 and $0 for the three month periods ended March 31, 2026 and 2025, respectively. Interest expense related to the discount charge was $67,869 and $331,763 for the three months ended March 31, 2026 and 2025, respectively. $317,193 and $48,913 of deferred financing costs were recognized as a component of “interest expense” on the accompanying unaudited condensed consolidated statements of operations and comprehensive loss for the three months ended March 31, 2026 and 2025, respectively.