Note 18 - Debt Obligations |
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| Debt Disclosure [Text Block] |
(18) DEBT OBLIGATIONS
Debt obligations, net of debt issuance costs, as of June 30, 2026 and September 30, 2025, consisted of the following:
Amended Facility Agreement
On December 21, 2020, Conrent and the Company signed an amendment to the Amended Facility Agreement which extended the maturity date of the Amended Facility Agreement to July 1, 2024 (the “Amended Facility”), capitalized the accrued and unpaid interest increasing the outstanding principal amount and reduced the interest rate of the Amended Facility from 8% to 4%. On April 26, 2023, the Company and Conrent entered into another amendment to the Amended Facility (the “Amendment”). The Amendment: (i) extended the maturity date from July 1, 2024, to July 1, 2027; (ii) amended the applicable interest rate resulting in an escalating interest rate as follows: 4% through June 30, 2024, 5% through June 30, 2025, 5.5% through June 30, 2026, and 6% through the Maturity Date; and (iii) removed section 7.3 “Change of Control” of the Amended Facility Agreement. In return, the Company agreed to pay certain fees to Conrent. The Company has outstanding principal balance of $42,864,000, bearing interest at a rate of 4% per annum, payable in arrears annually beginning July 1, 2021, with all principal and accrued and unpaid interest due on July 1, 2024.
On April 30, 2026, the Company and Conrent entered into the Payoff Agreement, pursuant to which the Company agreed to pay $23,520,000 to Conrent in settlement of the outstanding $42,864,000 unsecured debt facility payable by the Company to Conrent, issued pursuant to the original facility agreement executed by and between the parties on December 30, 2013 (“Original Facility Agreement”), as amended May 30, 2014, June 30, 2015, July 19, 2018, February 24, 2019, January 10, 2020, December 21, 2020 and April 26, 2023, with a maturity date of July 1, 2027. The Payoff Agreement terminates and cancels the Amended Facility Agreement and releases and discharges the Company from all present or future, actual or contingent liabilities, obligations and guarantees created, evidenced or conferred by, and all claims, charges, liens, security interests, actions, suit, accounts and demands arising under or in any way related to the Original Facility Agreement and/or or any other agreement between the parties. The Payoff Agreement was accounted for as a Troubled Debt Restructuring (“TDR”) in accordance with ASC 470-60, Troubled Debt Restructuring by Debtors. The Company recognized a TDR gain of $23.5 million, which is presented as Gain on troubled debt restructuring in the consolidated statements of operations for the three months ended June 30, 2026. As of June 30, 2026, $0 of principal and $0 of interest was owed to Conrent.
Credit Agreement
On April 30, 2026, the Company and certain subsidiaries of the Company (together with the Company, collectively, the “Borrowers”) entered into a Credit Agreement (the “Credit Agreement”) by and among the Borrowers, the lenders from time-to-time party thereto (the “Lenders”), and Chatham Capital Management, LLC, as administrative agent for the Lenders (the “Administrative Agent”). Pursuant to the Credit Agreement, the Lenders extended a credit facility in the maximum aggregate principal amount of $24.0 million, consisting of (i) the Term Loan, which was funded in full on April 30, 2026, (ii) a revolving line of credit in the principal amount of $2.0 million and (iii) the Interest Line Loan Facility in the principal amount of $1.0 million.
The Credit Agreement has a maturity date of April 30, 2031. Loans outstanding under the Credit Agreement will bear interest at an overall rate of 13.5% per annum, with 11.0% paid in cash and 2.5% paid-in-kind. If the Borrowers elect to borrow on the Interest Line Loan Facility to make cash payments of interest on the loans to the Lenders in any month, the overall rate of interest shall increase to 15.5% per annum for any such month, with 11.0% paid in cash and 4.5% paid-in-kind. Principal payments on the Term Loan and borrowings under the Interest Line Loan Facility are required to be made in monthly installments, commencing on June 1, 2028, at a rate of 5% per annum of the outstanding principal amount thereof. In connection with the Credit Agreement, on April 30, 2026, the Borrowers entered into a Guaranty and Collateral Agreement with the Administrative Agent (the “Guaranty and Collateral Agreement”), pursuant to which each of the Borrowers granted to the Administrative Agent a first-priority perfected lien upon substantially all of the assets of the Borrowers to secure the obligations of the Borrowers under the Credit Agreement.
At closing, the Company incurred certain fees and third‑party debt issuance costs of $0.6 million and debt discount cost of $3.0 million, comprising of $2.2 million of lender fees and $0.8 million of fees related to the Warrants, associated with the Term Loan and are presented as a direct deduction from the carrying amount of the Term Loan and amortized using the effective interest method. Revolving Line of Credit and Interest Line Loan Facility issuance costs are presented as a deferred asset and amortized on a straight‑line basis over the term of the facility.
As of June 30, 2026, $21,090,514 of principal and $194,595 of interest was owed under the Term Loan, $0 of principal and $0 of interest was owed under the Revolving Credit Line, and $0 of principal and $0 of interest was owed under the Interest Line Loan Facility.
As of June 30, 2026, unamortized deferred loan costs related to the Term Loan were $3,507,979. Unamortized Revolving Line of Credit and the Interest Line Loan Facility issuance costs, presented within “Other Assets” were $393,016.
The following table summarizes our future maturities of debt obligations, net of the amortization of debt discounts as of June 30, 2026:
The schedule above reflects contractual amortization of the Term Loan and the remaining amount due at maturity on April 30, 2031. Any outstanding Revolving Line of Credit Loans and Interest Line Loan Facility mature on April 30, 2031, and would be reflected in 2031, however, as of June 30, 2026, there have been no drawdowns on the Revolving Line of Credit or the Interest Line Loan Facility.
The Credit Agreement contains certain financial and non‑financial covenants. The Company was in compliance with all covenants as of June 30, 2026. |
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