Company: WKSP
Filing Date: 2025-11-13
Form Type: 10-Q
Source: 0001493152-25-022113
Chunk: 23

Company: Worksport Ltd
Filing Date: 2025-11-13
Form: 10-Q
Item: Part I, Item 1
Chunk 23
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222,992)
  
    Long-term debt 
    $1,014,043  
    $4,781,005 

    a)
    On
    July 19, 2024, the Company, as the guarantor, and Worksport New York Operations Corporation as well as Worksport USA Operations Corporation,
    entered into a $6,000,000 Revolving Financing and Assignment Agreement with an external lending entity with a maturity date of July
    18, 2026, or 24 months. Upon transaction close, the Company drew down approximately $5.06 million of the Revolving Credit Facility,
    net of $790,000 of interest reserve required to be withheld to ensure interest payments by the Company. The Company used $4.73 million
    of the drawn down amount to refinance the Company’s mortgage on the Company’s real property located at 2500 North America
    Dr. in West Seneca, New York, and additionally drew approximately $330,000 to fund operations. Interest on the outstanding Revolving
    Credit Facility is based on the greater of the prime rate or 6.0% plus an additional 300 basis points. At September 30, 2025, the
    outstanding balance of this loan was $1,523,937 (net of issuance costs of $62,095).

For
collateral, the lender holds a first position on the Company’s major asset classes (accounts receivable, the factory in New York,
and inventory) other than the Company’s equipment. A non-usage fee of 0.25% is assessed quarterly and applied to the difference
between the quarter’s average daily outstanding loan balance and the total credit facility amount. As of September 30, 2025, the
Company had an available balance of $3,291,250 to borrow on the Revolving Credit Facility.

    b)
    On
    September 4, 2024, the Company, through its wholly owned subsidiary, Worksport USA Operations Corporation, entered into a $1,487,200
    credit and security agreement with an external lending entity with a maturity date of September 1, 2027, which is 36 months from
    initial funding. Upon transaction close, the Company received net proceeds of $1,412,750 (net of issuance costs of $43,735). The
    Company and its wholly owned subsidiary, Worksport New York Operations Corporation, serve as guarantors on the loan