QUANTUM CORP /DE/

NOTE 4: DEBT

The following table summarizes the Company's borrowing as of the dates presented (in thousands):

(1) The unamortized debt issuance costs related to the Term Loan are presented as a reduction of the carrying amount of the corresponding debt balance on the accompanying condensed consolidated balance sheet as of March 31, 2026.

Prior to June 2026, the Company’s debt consisted of (i) senior secured term loans (the “Term Loan”) under its Term Loan Credit and Security Agreement, dated August 5, 2021, as amended (the “Term Loan Credit Agreement”), and (ii) a 10.00% PIK Senior Secured Convertible Note due 2028 (the “Convertible Note”) issued on December 18, 2025 to Dialectic Technology SPV, LLC (“Dialectic”) in exchange for the Term Loans held by Dialectic. The Company elected the fair value option under ASC 825 for the Convertible Note. In connection with the Fifteenth Amendment to the Term Loan Credit Agreement, entered into on September 23, 2025 (the “Fifteenth Amendment”), the Company issued Dialectic a warrant to purchase up to 2,653,308 shares of its common stock (the “Forbearance Warrant”). For a description of the terms of, and amendments to, these instruments, see the notes to the audited consolidated financial statements included in the Annual Report.

On June 1, 2026, the Company entered into a Sixteenth Amendment to the Term Loan Credit Agreement to facilitate the Private Placement (as defined in Note 7 : Common Stock) and the Conversion (as defined below).

Pursuant to a Conversion Agreement dated June 1, 2026 (the “Conversion Agreement”), on June 4, 2026, Dialectic, as the sole beneficial owner of the Convertible Note, voluntarily converted the entire principal amount of the

Convertible Note, together with all accrued and unpaid interest thereon, which was approximately $57.2 million, into shares of the Company’s common stock (the “Conversion”), and the Convertible Note was canceled.

As consideration for the Conversion, the Company (i) amended the Convertible Note to waive certain notice and settlement requirements otherwise applicable to a voluntary exchange; (ii) issued to Dialectic 3.1 million additional shares of the Company’s common stock, representing the present value of PIK interest that would have accrued on the Convertible Note through its stated maturity plus the Term Loan deferred cash interest owed to Dialectic, divided by the $5.1940 conversion price; and (iii) issued to Dialectic the Conversion Warrant (as defined in Note 7 : Common Stock). See Note 7 : Common Stock for additional information.

On June 4, 2026, the Company paid an aggregate of $57.8 million in connection with the termination of the Term Loan Credit Agreement, consisting of the entire outstanding principal amount, accrued interest, and fees and expenses incurred in connection with the termination. The Company recorded a loss on debt extinguishment of $11.7 million associated with this transaction.

On June 4, 2026 and pursuant to the terms of the Conversion Agreement, the Convertible Note was canceled, and the Indenture was satisfied and discharged in full. See Note 11: Fair Value of Financial Instrumentsfor full details of the transaction.

Related Party Transactions

The Forbearance Warrant, Conversion Warrant and Convertible Note issued to Dialectic constitute related party transactions, as John Fichthorn, a member of the Company's board of directors, is also Managing Partner of Dialectic Capital Management, the investment adviser to Dialectic. The fair values of the Forbearance Warrant and Conversion Warrant as of September 30, 2026 are included in Note 11: Fair Value of Financial Instruments. The Convertible Note was canceled on June 4, 2026 when the indenture governing the Convertible Note was satisfied and discharged in full.