Quarterly report [Sections 13 or 15(d)]

Long-Term Debt

v3.25.4
Long-Term Debt
 3 Months Ended
Dec. 31, 2025
Debt Disclosure [Abstract]  
Long-Term Debt Long-Term Debt
Long-term debt as of December 31, 2025 and September 30, 2025 consisted of the following (in $000's):
December 31, 2025 September 30, 2025
Revolver loans $ 44,807  $ 48,713 
Equipment loans 8,761  9,617 
Term loans 13,213  8,749 
Other notes payable 11,105  11,509 
Total notes payable 77,886  78,588 
Less: unamortized debt issuance costs (1,066) (426)
Net amount 76,820  78,162 
Less: current portion (30,901) (36,282)
Total long-term debt $ 45,919  $ 41,880 
Future maturities of long-term debt at December 31, 2025, are as follows which does not include related party debt (in $000’s):
Twelve months ending December 31,
2026 $ 30,901 
2027 6,660 
2028 30,001 
2029 361 
2030 208 
Thereafter 8,689 
Total future maturities of long-term debt $ 76,820 
Bank of America Revolver Loan (Marquis)
On July 25, 2025, Marquis entered into an amended $28.0 million revolving credit agreement (“BofA Revolver”) with Bank of America Corporation (“BofA”). The BofA Revolver is an asset-based facility that is secured by substantially all of Marquis’ assets. Availability under the BofA Revolver is subject to a monthly borrowing base calculation. Marquis’ ability to borrow under the BofA Revolver is subject to the satisfaction of certain conditions, including meeting all loan covenants under the credit agreement with BofA. The BofA Revolver has a variable interest rate and matures on July 31, 2026. As of December 31, 2025 and September 30, 2025, the outstanding balance was approximately $8.1 million and $11.8 million, respectively.
Legacy Corporate Lending (Precision Marshall)
On December 30, 2025, Precision Marshall, Kinetic, and Central Steel refinanced their Fifth Third Bank loans (see below) with a new credit facility with Legacy Corporate Lending. The refinanced facility totals $47.0 million and consists of $31.2 million in revolving credit (the “Legacy Revolver”), $9.8 million in term lending (the “Legacy Term”), and $6.0 million in Capex lending (the “Legacy Capex”). Borrowings under the Legacy Revolver bear interest at 4.25% per annum over the one‑month Secured Overnight Financing Rate (“SOFR”), while the Legacy Term and Legacy Capex loans bear interest at 4.5% per annum over the one‑month SOFR. In connection with the refinancing, Precision Marshall incurred approximately $0.7 million in debt acquisition costs, which will be capitalized as a contra-liability and amortized over the three-year term of the facility. The refinancing provides additional lending capacity to support future growth. The facility matures on December 30, 2028. As of December 31, 2025, the outstanding balances on the Legacy Revolver, Legacy Term, and Legacy Capex were $24.0 million, $9.8 million, and $0, respectively.
Loan with Fifth Third Bank (Precision Marshall)
Prior to its refinancing on December 30, 2025 (see above), Precision Marshall maintained a credit facility with Fifth Third Bank. As of December 31, 2025, all borrowings under the facility had been fully repaid in connection with the refinancing,
and Precision Marshall wrote off approximately $58,000 of unamortized debt acquisition costs. Accordingly, the outstanding balances at December 31, 2025 and September 30, 2025 were approximately $0 and $23.0 million, respectively, for the revolving loan; $0 and $1.3 million, respectively, for the original M&E term note; $0 and $2.1 million, respectively, for Kinetic Term Loan #1; and $0 and $1.7 million, respectively, for the Capex loan.
Eclipse Business Capital Loans (Flooring Liquidators)
On January 8, 2026, Flooring Liquidators entered into an amended credit facility with Eclipse Business Capital, LLC (“Eclipse”), which extends the facility’s maturity date to February 18, 2026. The facility consists of $25.0 million in revolving credit (“Eclipse Revolver”) and $3.5 million in M&E lending (“Eclipse M&E”). The Eclipse Revolver is a three-year, asset-based facility that is secured by substantially all of Flooring Liquidators’ assets. Availability under the Eclipse Revolver is subject to a monthly borrowing base calculation. Flooring Liquidators’ ability to borrow under the Eclipse Revolver is subject to the satisfaction of certain conditions, including meeting all loan covenants under the credit agreement with Eclipse. The Eclipse Revolver bears interest at 3.5% per annum in excess of Adjusted Term SOFR. The Eclipse M&E loan bears interest at 5.0% per annum in excess of Adjusted Term SOFR. The extended maturity date provides Flooring Liquidators with time to negotiate and finalize the terms of a refinancing. As of December 31, 2025 and September 30, 2025, the outstanding balance on the Eclipse Revolver was approximately $5.5 million and $6.7 million, respectively, and the outstanding balance on the Eclipse M&E loan was approximately $0.9 million and $1.0 million, respectively.
Loan with Fifth Third Bank (PMW)
In connection with the acquisition of PMW, on July 20, 2023, PMW entered into a revolving credit facility (the “Revolving Credit Facility”) with Fifth Third Bank. The facility consists of $15.0 million in revolving credit (the “Fifth Third Revolver”) and approximately $5.0 million in M&E lending (the “Fifth Third M&E Loan”). The Fifth Third Revolver is a three-year, asset-based facility that is secured by substantially all of PMW's assets. Availability under the Fifth Third Revolver is subject to a monthly borrowing base calculation. PMW's ability to borrow under the Fifth Third Revolver is subject to the satisfaction of certain conditions, including meeting all loan covenants under the credit agreement with Fifth Third. Loans made under the Revolving Credit Facility are considered Reference Rate Loans, and bear interest at a rate equal to the sum of the Reference Rate plus the Applicable Margin. Reference Rate means the greater of (a) 3.0% or (b) the Lender’s publicly announced prime rate (which is not intended to be Lender’s lowest or most favorable rate in effect at any time) in effect from time to time. The Applicable Margin for revolving loans is zero, while for the Fifth Third M&E Loan or any Capital Expenditure Term Loan (as defined in the Revolving Credit Facility), it is 50 basis points (0.5%). The credit facility matures in July 2026. As of December 31, 2025 and September 30, 2025, the outstanding balance on the Fifth Third Revolver was approximately $7.3 million and $7.2 million, respectively, and the balance on the Fifth Third M&E Loan was approximately $3.4 million and $3.6 million, respectively.
Bank Midwest Revolver Loan (Vintage)
On October 17, 2025, Vintage entered into an amended $8.0 million credit agreement with Bank Midwest (“Bank Midwest Revolver”). The amended Bank Midwest Revolver carries the same interest rate as the prior amendment and matures on October 17, 2026. As of December 31, 2025 and September 30, 2025, the outstanding balance on the Bank Midwest Revolver was $0.
Note payable to JCM Holdings (Marquis)
During October 2020, Marquis purchased a manufacturing facility, which it had previously leased, for approximately $2.5 million. Marquis entered into a $2.0 million loan agreement, secured by the facility, with the seller of the facility, in order to complete the purchase of the facility. The loan bears interest at 6.0%, due monthly, and matures January 2030. As of December 31, 2025 and September 30, 2025, the outstanding principal balance was approximately $1.0 million and $1.1 million, respectively.
Note Payable to Store Capital Acquisitions, LLC (Marquis)
On June 14, 2016, Marquis entered into a transaction with Store Capital Acquisitions, LLC. The transaction included a sale-leaseback of land owned by Marquis and a loan secured by the improvements on such land. The total aggregate proceeds received from the sale of the land and the loan was $10.0 million, which consisted of approximately $0.6 million from the sale of the land and a note payable of approximately $9.4 million. In connection with the transaction, Marquis entered into a lease with a 15-year term commencing on the closing of the transaction, which provides Marquis with an option to extend the lease upon the expiration of its term. The initial annual lease rate is $60,000. The proceeds from this transaction were used to pay down the BofA Revolver and Term loans, and related party loan, as well as to purchase a
building from the previous owners of Marquis that was not purchased in the July 2015 transaction. The note payable bears interest at 9.3% per annum, with principal and interest due monthly. The note payable matures June 13, 2056. For the first five years of the note payable, there is a pre-payment penalty of 5%, which declines by 1% for each year the loan remains unpaid for the next five years. At the end of ten years, there is no pre-payment penalty. In connection with the note payable, Marquis incurred approximately $458,000 in transaction costs that are being recognized as a debt issuance cost and are being amortized and recorded as interest expense over the term of the note payable. The remaining principal balance was approximately $8.7 million as of each of December 31, 2025 and September 30, 2025.
Equipment Loans
On June 20, 2016 and August 5, 2016, Marquis entered into a transaction that provided for a master agreement and separate loan schedules (the “Equipment Loans”) with Banc of America Leasing & Capital, LLC that provided for the following as of December 31, 2025:
Note #7 is for $5.0 million, secured by equipment. The Equipment Loan #7 is due February 2027, payable in 84 monthly payments of $59,000 beginning March 2020, with the final payment of $809,000, bearing interest at 3.2% per annum. As of December 31, 2025 and September 30, 2025, the balance was approximately $1.5 million and $1.7 million, respectively.
Note #8 is for approximately $3.4 million, secured by equipment. The Equipment Loan #8 is due September 2027, payable in 84 monthly payments of $46,000 beginning October 2020, bearing interest at 4.0%. As of December 31, 2025 and September 30, 2025, the balance was approximately $0.9 million and $1.1 million, respectively.
In December 2021, Marquis funded the acquisition of $5.5 million of new equipment under Note #9 of its master agreement. The Equipment Loan #9, which is secured by the equipment, matures December 2026, and is payable in 60 monthly payments of $92,000 beginning January 2022, with the final payment in the amount of approximately $642,000, bearing interest at 3.75% per annum. As of December 31, 2025 and September 30, 2025, the balance was approximately $1.6 million and $1.9 million, respectively.
In December 2022, Marquis funded the acquisition of $5.7 million of new equipment under Note #10 of its master agreement. The Equipment Loan #10, which is secured by the equipment, matures December 2029, and is payable in 84 monthly payments of $79,000, beginning January 2023, with the final payment in the amount of approximately $650,000, bearing interest at 6.50%. As of December 31, 2025 and September 30, 2025, the balance was approximately $3.8 million and $4.0 million, respectively.
Related Party Seller Notes
Seller notes as of December 31, 2025 and September 30, 2025 consisted of the following (in $000’s):
December 31,
2025		 September 30,
2025
Seller of Flooring Liquidators, 8.24% interest rate, matures February 2028
 $ 15,000  $ 15,000 
Seller of Kinetic, 7.0% interest rate, matures September 2027
 3,000  3,000 
Seller of Central Steel, 8.0% interest rate, matures May 2029
 962  1,031 
Total Seller notes payable - related parties 18,962  19,031 
Less: unamortized debt discount (734) (811)
Net amount 18,228  18,220 
Less: current portion (275) (275)
Long-term portion of Seller notes - related parties $ 17,953  $ 17,945 
Future maturities of seller notes at December 31, 2025 are as follows (in $000’s):
Twelve months ending December 31,
2026 $ 275 
2027 3,275 
2028 14,540 
2029 138 
Total $ 18,228 
Note Payable to the Seller of Kinetic
In connection with the purchase of Kinetic, on June 28, 2022, Kinetic entered into an employment agreement with the previous owner of Kinetic to serve as its Head of Equipment Operations. The employment agreement is for an initial term of five years and shall be automatically extended in 90-day increments unless either party provides notice as required under the agreement. Additionally, Precision Marshall entered into a seller financed loan in the amount of $3.0 million with the previous owner of Kinetic (the "Seller Subordinated Acquisition Note"). The Seller Subordinated Acquisition Note bears interest at 7.0% per annum, with interest payable quarterly in arrears, and has a maturity date of September 27, 2027. As of December 31, 2025 and September 30, 2025, the remaining principal balance was $3.0 million.
Note Payable to the Seller of Flooring Liquidators
In connection with the purchase of Flooring Liquidators during January 2023, the Company entered into an employment agreement with the previous owner of Flooring Liquidators to serve as its Chief Executive Officer. The employment agreement is for an initial term of five years and shall be automatically extended in 90-day increments unless either party provides notice as required under the agreement. Additionally, the Company entered into a seller financed mezzanine loan, which is fully guaranteed by the Company, in the amount of $34.0 million with the previous owners of Flooring Liquidators. The Seller Subordinated Acquisition Note (“Seller Note”) bears interest at 8.24% per annum, with interest payable monthly in arrears beginning on January 18, 2024. The Seller Note has a maturity date of January 18, 2028. As of the acquisition date, an independent third-party valuation assigned the Seller Note a fair value of $31.7 million, reflecting a $2.3 million discount.
On February 25, 2025, Flooring Liquidators, Flooring Affiliated Holdings, and the Company entered into a binding Memorandum of Understanding (“MOU”) with the previous owner of Flooring Liquidators under which the principal amount of the Seller Note was reduced from $34.0 million to $15.0 million. The relevant portion of the MOU was later superseded by a Second Amendment to Seller Note. The Seller Note bears interest at 8.24% per annum effective January 1, 2025, and matures in February 2028, with interest payments due monthly beginning February 2025. The Company determined that the fair value of the amended Seller Note was approximately $14.0 million, reflecting a $1.0 million discount. In an event of default under the Seller Note, or if the Company defaults in making any payment it is required to make pursuant to the Seller Note, the note holders may revoke the principal reduction, in which case the aggregate outstanding principal balance of the Seller Note will increase by $19.0 million to $34.0 million. As of December 31, 2025 and September 30, 2025, the carrying value of the Sellers Note was approximately $15.0 million.
Note Payable to the Seller of Central Steel
In connection with the purchase of Central Steel, on May 15, 2024, Precision Marshall entered into an employment agreement with the previous owner of Central Steel to serve as its President. The employment agreement is for an initial term of two years and shall be deemed to be automatically extended, upon the same terms and conditions, for a period of one year, unless either party provides written notice of its or his intention not to extend the term at least 90 days prior to the end of the initial term. Additionally, Precision Marshall entered into a seller financed loan in the amount of $1.1 million with the previous owner of Central Steel (the "Sellers Subordinated Promissory Note"). The Sellers Subordinated Promissory Note bears interest at 8.0% per annum, with interest payable quarterly in arrears. The Sellers Subordinated Promissory Note has a maturity date of May 15, 2029. As of December 31, 2025 and September 30, 2025, the remaining principal balance was $0.9 million and $1.0 million, respectively.