Revolving Credit Facility |
6 Months Ended | |||||||||||||||||||||||||||
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Jun. 30, 2026 | ||||||||||||||||||||||||||||
| Debt Disclosure [Abstract] | ||||||||||||||||||||||||||||
| Revolving Credit Facility |
During the year ended December 31, 2024, the Company entered into a Revolving Financing and Assignment Agreement (the “RFAA”) which provides a revolving credit facility up to an amount of $2,000,000 (the “Total Credit Facility”) with an interest rate equal to the prime rate plus 3.50% per annum, with a floor rate of 6.00%. On February 24, 2025, the Company made a payment of $0.1 million to fully repay the Total Credit Facility and formally terminated the RFAA. Following this payment, the Company was released from any further liabilities under the terms of the RFAA.
On February 5, 2025, the Company, through one of its subsidiaries (the “Loan Subsidiary”), entered into 2Shores Credit Facility with Two Shores , pursuant to which the Loan Subsidiary may borrow up to an aggregate maximum amount of $5.0 million which was amended to $10.0 million on December 1, 2025, subject to the satisfaction of certain conditions. Advances under the 2Shores Credit Facility bear interest at a rate of 13.75% per annum. All present and future obligations of the Loan Subsidiary under the 2Shores Loan Credit Facility are secured by a first-priority security interest in all assets of the Company, the Loan Subsidiary, and the Company’s other U.S. subsidiaries. The Company is obligated to provide periodic financial reporting, reporting of its inventory and accounts receivable listings, maintenance of its subsidiaries in good legal standing, maintenance of its insurance policies and payments of its tax obligations.
During the year ended December 31, 2025, in connection with the2Shores Loan Credit Facility, the Company issued total 1,000,000 warrants to Two Shores, exercisable at a price of $0.45 per share for a period of three years from the date of issuance. The Company estimated the fair value of the warrants at $65,215 on the issuance date. This amount was recognized as finance costs in the consolidated statements of operations. The valuation of the warrants was performed using the Black-Scholes option pricing model, applying the following weighted-average assumptions:
As of June 30, 2026, the outstanding balance under the Loan Agreement, including accrued interest, was approximately $3.7 million (December 31, 2025 – $3.02 million). |