DEBT |
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| DEBT | 13.DEBT A summary of the Company’s debt is as follows:
Term Loan On July 15, 2024, the Company entered into an Amended and Restated Loan and Security Agreement (the “Loan Agreement”) with Customers Bank. Pursuant to the Loan Agreement, Customers Bank issued a term loan in the principal amount of $6.0 million (the “Loan”). The Loan Agreement, which was entered into in connection with the acquisition of HelloTech, did not result in the Company’s receipt of any loan proceeds. Interest is payable on the Loan at a rate equal to the greater of (a) the prime rate published in The Wall Street Journal or (b) 6.0%, and the maturity date is July 15, 2029 (the “Maturity Date”). Payments under the Loan were interest-only through January 15, 2025. Thereafter, the Company was required to pay equal monthly installments of principal plus accrued interest until the Maturity Date. There is no penalty for prepayment of the Loan. The fair value of the Loan was $4.6 million as of December 31, 2025. Pursuant to the Loan Agreement, Customers Bank was granted security interest in substantially all of the Company’s assets, other than intellectual property, and the Loan Agreement contains customary affirmative and negative covenants, including a requirement to maintain a liquidity ratio equal to four times the outstanding principal balance. The Loan was repaid in full and the Loan Agreement was terminated on May 11, 2026, in connection with the Company’s entry into the Credit Facility, as described below. The Company was in compliance with the covenants under the Loan Agreement at all times through May 11, 2026. Upon repayment, all amounts and other obligations under the Loan Agreement were satisfied, and the Loan Agreement and all commitments thereunder were terminated. No material early termination penalties were incurred. In connection with the repayment, the Company wrote off $0.1 million of unamortized debt issuance costs related to the Loan, which was recognized as a loss on extinguishment of debt in the accompanying Condensed Consolidated Statements of Operations and Comprehensive Loss for the three and six months ended June 30, 2026. In connection with the termination of the Loan Agreement, liens and security interests previously granted in favor of Customers Bank were released subject to customary payoff documentation, including lien releases and UCC termination statements. Credit Facility On May 11, 2026, DOOR Systems entered into a revolving credit facility (the “Credit Facility”) with Truist Bank (the “Lender”), providing for borrowing of up to $5.0 million. The Credit Facility matures in May 2028, and bears interest at a variable rate equal to term Secured Overnight Financing Rate plus 1.75% per annum. The Credit Facility requires monthly interest-only payments, with all principal due at maturity, and includes customary fees, reporting requirements and events of default. As of June 30, 2026, future principal payments on the Company’s outstanding debt of $4.4 million are due in the year ending December 31, 2028, with no principal payments due in the remainder of 2026 and . In connection with entering into the Credit Facility, the Company borrowed approximately $4.4 million under the Credit Facility to repay all outstanding principal, accrued interest, and fees under the Loan. As of June 30, 2026, $0.6 million was available for future borrowings under the Credit Facility. The Credit Facility is governed by a promissory note (the “Promissory Note”) and related loan documents. To secure the Credit Facility, the Company is required to maintain a minimum cash balance of $5.25 million in a restricted deposit account with the Lender. Borrowing under the Credit Facility is secured by certain cash deposit accounts and/or certificates of deposit of the Company, including all funds held therein. As of June 30, 2026, restricted cash of $5.3 million securing the Credit Facility was included in other non-current assets on the accompanying Condensed Consolidated Balance Sheets. The Promissory Note contains customary covenants and events of default, including covenants relating to:
If an event of default exists under the Promissory Note, the Lender will be able to accelerate the maturity of the loan and exercise other rights and remedies. Events of default include, but are not limited to, the following events:
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