NOTE 8 – LONG-TERM DEBT AND BONDS PAYABLE

Green Convertible Notes

On August 24, 2023, the Company issued $250.0 million aggregate principal amount of 7.25% Green Convertible Senior Notes due August 15, 2030 (the “Green Convertible Notes”) at an issue price of $900 per $1,000 principal amount, with the discount accreting through August 15, 2027. The Green Convertible Notes will mature on August 15, 2030 (the “Maturity Date”), unless earlier repurchased, redeemed or converted. The Green Convertible Notes will bear interest at a rate of 7.25% per annum on the principal amount at maturity from August 24, 2023, payable semi-annually in arrears on February 15 and August 15 of each year, beginning on February 15, 2024. The Green Convertible Notes are senior unsecured obligations of the Company. Entities affiliated with a greater than 5% beneficial owner of the Company purchased $50.0 million aggregate principal amount at maturity of the Green Convertible Notes.

Holders of the Green Convertible Notes may convert all or any portion of their Green Convertible Notes at their option at any time prior to maturity at an initial conversion rate of 67.4764 shares of Common Stock per $1,000 principal amount at maturity of the Green Convertible Notes (equivalent to an initial conversion price of approximately $14.82 per share of Common Stock), subject to adjustment. The Company may settle conversions in cash, shares of its Common Stock, or a combination thereof, at the Company's option. There were no conversions during the three months ended March 31, 2026 and there were no changes to the conversion rate during the period.

Holders may require the Company to repurchase for cash all or any portion of their Green Convertible Notes on August 15, 2027 at a redemption piece equal to 100% of the principal amount at maturity of the Green Convertible Notes to be repurchased, plus accrued and unpaid interest, or upon a fundamental change at 100% of the accreted principal amount plus accrued and unpaid interest to, but excluding, the fundamental change repurchase date. If certain stock price conditions are met, the Company may redeem the Green Convertible Notes on or after August 20, 2025, and on or before the 40th scheduled trading day immediately before the Maturity Date, at a cash redemption price equal to 100% of the accreted principal amount of the Green Convertible Notes to be redeemed, plus accrued and unpaid interest.

The Indenture, dated August 24, 2023 (the “Indenture”), with U.S. Bank Trust Company, National Association, as trustee, governing the Green Convertible Notes includes customary covenants and events of default, after which the Green Convertible Notes may be declared immediately due and payable. As of March 31, 2026, the Company was in compliance with all covenants under the Indenture.

Revenue Bonds

In October 2020, the Southern Ohio Port Authority (“SOPA”) issued Revenue Bonds (as defined below) pursuant to an Indenture of Trust dated as of October 1, 2020 (as amended, restated, supplemented or otherwise modified from time to time, the “Indenture of Trust”), between SOPA and UMB Bank, N.A., as trustee, and loaned the proceeds from the Revenue Bond sale to PureCycle: Ohio LLC (“PCO”), an Ohio limited liability company and indirect wholly-owned subsidiary of the Company, pursuant to a Loan Agreement dated as of October 1, 2020, between SOPA and PCO (as amended, restated, supplemented or otherwise modified from time to time, the “Loan Agreement”). The proceeds are to be used, among other things, to acquire, construct and equip a portion of the Company's first commercial-scale recycling facility in Lawrence County, Ohio (the "Ironton Facility"). Capitalized terms used but not defined have the meanings set forth in the Indenture of Trust or the Loan Agreement.

The Revenue Bonds were offered in three series (collectively referred to as “the Bonds” or the “Revenue Bonds”):

In March 2024, PureCycle Technologies LLC ("PCT LLC"), a subsidiary of the Company, purchased 99% of the outstanding Revenue Bonds. PCT LLC has subsequently sold certain of these Revenue Bonds to various third and related parties.

During the three months ended March 31, 2026, the Company did not sell any of its Senior Bonds. During the three months ended March 31, 2025, the Company sold $18.6 million in aggregate principal amount of its Senior Bonds to third parties at a price of $880 per $1,000 principal amount for gross proceeds of $16.4 million.

As of March 31, 2026, there were $75.6 million of outstanding Bonds that PCT LLC intends to, and has the ability to, re-market based on the need for additional liquidity.

The Revenue Bonds are recorded within long-term debt (current and noncurrent) and related party bonds payable (current and noncurrent) in the Condensed Consolidated Balance Sheets. The Company incurred $0.6 million and $0.3 million of third party effective interest expense during the three months ended March 31, 2026 and 2025, respectively. As the Revenue Bond proceeds were used to construct the Company’s property, plant and equipment, the interest costs related to the tax-exempt portion of the Revenue Bonds have been capitalized within Property, Plant and Equipment. There was no interest cost capitalized during the three months ended March 31, 2026 and 2025.

Revenue Bonds Sold to Related Parties

During the three months ended March 31, 2026 and 2025, the Company did not sell any of its Senior Bonds to related parties.

The Company incurred effective interest expense on the related party bonds of $3.8 million and $3.9 million for the three months ended March 31, 2026 and 2025, respectively.

Sylebra Credit Facility

PCT has a $200.0 million Revolving Credit Facility pursuant to a credit agreement (the "Revolving Credit Agreement") dated as of March 15, 2023 and amended from time to time, with PureCycle Technologies Holdings Corp., PCT LLC and PureCycle Augusta, LLC (collectively, the “Guarantors”), Sylebra Capital Partners Master Fund, LTD, Sylebra Capital Parc Master Fund, and Sylebra Capital Menlo Master Fund (collectively, the “Lenders”), and Madison Pacific Trust Limited. The Lenders and their affiliates are greater than 5% beneficial owners of PCT. The Revolving Credit Facility matures on September 30, 2027.

Amounts outstanding under the Revolving Credit Agreement bear interest at a variable annual rate equal to Term SOFR (as defined in the Revolving Credit Agreement) in effect for such period plus 17.50%. PCT is also required to pay a commitment fee of 0.25% per annum based on the actual daily unused amount of the Revolving Credit Facility, payable quarterly. Subject to timely prior written notice and payment of breakage fees, if any, PCT may at any time and from time to time (i) terminate all or any portion of the commitments under the Revolving Credit Agreement and/or (ii) prepay all or any portion of any outstanding borrowings.

The Revolving Credit Agreement contains representations, covenants and events of default that are customary for financing transactions of this nature. Amounts outstanding are guaranteed by the Guarantors and secured by a security interest in substantially all of the assets of PCT and its majority-owned direct or indirect subsidiaries. Any majority-owned direct or indirect subsidiaries of PCT are required to guaranty the obligations under the Revolving Credit Agreement and grant security interests in substantially all of their respective assets.

On April 28, 2026, the Company entered into an Agreement pursuant to which PureCycle (Thailand) Company Limited, a wholly-owned subsidiary of the Company, became a Guarantor under the Revolving Credit Agreement. In addition, a Pledge of Shares Agreement was entered into on the same date pursuant to which the Company pledged its shares of PureCycle (Thailand) Company Limited as collateral security for its obligations under the Revolving Credit Agreement.

There were no funds drawn on the Revolving Credit Facility as of March 31, 2026 and December 31, 2025, respectively. As of March 31, 2026, the Company was in compliance with all covenants under the Revolving Credit Agreement.