Quarterly report pursuant to Section 13 or 15(d)

Debt

v3.21.1
Debt
3 Months Ended
Mar. 31, 2021
Debt Disclosure [Abstract]  
Debt

Note 6 — Debt

 

Convertible Notes

 

The fair value and face value principal of outstanding convertible notes as of March 31, 2021 and December 31, 2020 was as follows:

 

    Contractual
Maturity Date
  Stated Interest Rate     Conversion Price per Share     Face Value Principal Outstanding     Fair Value  
November 2019 Senior Secured Convertible Note   September 30, 2021     7.875 %   $ 1.60     $     $  
April 2020 Senior Convertible Note   April 30, 2022     7.875 %   $ 5.00     $     $  
August 2020 Senior Secured
Convertible Note
  August 6, 2022     7.875 %   $ 5.00     $     $  
Balance - March 31, 2021(1)                       $     $  
November 2019 Senior Secured Convertible Note   September 30, 2021     7.875 %   $ 1.60     $ 956     $ 1,270  
April 2020 Senior Convertible Note   April 30, 2022     7.875 %   $ 5.00     $ 4,111     $ 4,600  
August 2020 Senior Secured
Convertible Note
  August 6, 2022     7.875 %   $ 5.00     $ 7,750     $ 8,790  
Balance - December 31, 2020                       $ 12,817     $ 14,660  

 

  (1) As discussed below, during the three months ended March 31, 2021 all remaining convertible notes were repaid, including: the November 2019 Senior Convertible Note being repaid-in-full as of January 5, 2021; and both the April 2020 Senior Convertible Note and the August 2020 Senior Convertible Note were repaid-in-full as of March 2, 2021.

 

Senior Secured Convertible Note issued November 4, 2019 - Series A and Series B -

(“November 2019 Senior Convertible Notes”)

 

With respect to the November 2019 Senior Convertible Notes, in the year ended December 31, 2020, approximately $13,044 of installment principal repayments and the payment of interest thereon of approximately $465, were settled through the issuance of 8,854,004 shares of common stock of the Company, with a fair value of approximately $18,802 (with such fair value measured as the respective conversion date quoted closing price of the common stock of the Company). As of December 31, 2020, the November 2019 Senior Convertible Notes remaining unpaid outstanding face value principal was approximately $956.

 

The November 2019 Senior Convertible Note was repaid-in-full as of January 5, 2021, with the remaining principal balance of approximately $956, along with the payment of interest thereon of approximately $7, were settled with the issuance of 667,668 shares common stock of the Company, with a fair value of approximately $1,723 (with such fair value measured as the respective conversion date quoted closing price of the common stock of the Company).

 

Senior Convertible Note issued April 30, 2020 - (“April 2020 Senior Convertible Note”)

 

The Company issued a Senior Convertible Note dated April 30, 2020, with a face value principal of approximately $4,111, a stated interest rate of 7.875% per annum, and, at the election of the holder, was convertible into shares of common stock of the Company at a contractual conversion price of $5.00 per share - the “April 2020 Senior Convertible Note”. In the three months ended March 31, 2021, approximately $52 of non-installment payments were paid in cash. There were no such payments in the corresponding period of the prior year. The outstanding face value principal of the April 2020 Senior Convertible Note was repaid-in-full in March 2021, as discussed herein below.

 

Senior Secured Convertible Note issued August 6, 2020 - (“August 2020 Senior Convertible Note”)

 

The Company issued a Senior Secured Convertible Note dated August 6, 2020, with a face value principal of approximately $7,750, a stated interest rate of 7.875% per annum, and, at the election of the holder, was convertible into shares of common stock of the Company at a contractual conversion price of $5.00 per share - the “August 2020 Senior Convertible Note”. In the three months ended March 31, 2021, approximately $102 of non-installment payments were paid in cash. There were no such payments in the corresponding period of the prior year. The outstanding face value principal of the April 2020 Senior Convertible Note was repaid-in-full in March 2021, as discussed herein below.

 

Principal Repayments - April 2020 Senior Convertible Note and August 2020 Senior Convertible Note

 

On January 30, 2021, the Company paid in cash a $350 partial principal repayment of the April 2020 Senior Convertible Note; and on March 2, 2021, the Company paid in cash a total of $14,466 of principal repayments, resulting in both the April 2020 Senior Convertible Note and the August 2020 Senior Convertible Note being repaid-in-full as of such date. The Company recognized a debt extinguishment loss of approximately $2,955 in the three months ended March 31, 2021 in connection with the repayments of the April 2020 Senior Convertible Note and the August 2020 Senior Convertible Note.

 

Senior Secured Convertible Note issued December 27, 2018 - (“December 2018 Senior Convertible Note”)

 

The Company previously issued a Senior Secured Convertible Note dated December 27, 2018, with a $7.75 million face value principal, a stated interest rate of 7.875% per annum, and, at the election of the holder, was convertible into shares of common stock of the Company at a contractual conversion price of $1.60 per share (“December 2018 Senior Convertible Note”). In the three months ended March 31, 2020, with respect to the December 2018 Senior Convertible Notes, approximately $1,642 of installment principal repayments and the payment of interest thereon of approximately $4, were settled through the issue of 2,042,901 shares of common stock of the Company, with a fair value of approximately $2,834 (with such fair value measured as the respective conversion date quoted closing price of the common stock of the Company). Further, the December 2018 Senior Convertible Note was paid-in-full as of June 4, 2020, with the remaining principal balance of approximately $50 and the payment of interest thereon of approximately $2, settled by the issue of 32,297 shares of common stock of the Company, with a fair value of approximately $68, with such fair value measured as noted above.

 

A reconciliation in the fair value of debt during each of the three months ended March 31, 2021 and 2020 is as follows:

 

    December 2018 Senior Secured Convertible Note     November 2019 Senior Secured Convertible Notes     April 2020 Senior Convertible Note     August 2020 Senior Secured Convertible Note     Sum of Balance Sheet Fair Value Components     Other Income (Expense)  
Fair Value - December 31, 2020   $     $ 1,270     $ 4,600     $ 8,790     $ 14,660          
Installment repayments – common stock           (956 )                 (956 )        
Non-installment payments – common stock           (7 )                 (7 )        
Non-installment payments – cash                 (52 )     (102 )     (154 )        
Change in fair value           (307 )     (437 )     (938 )     (1,682 )     1,682  
Principal repayments - cash                 (4,111 )     (7,750 )     (11,861 )        
Fair Value at March 31, 2021   $     $           $     $          
Other Income (Expense) - Change in fair value - three months ended March 31, 2021                                           $ 1,682  
                                                 
Fair Value – December 31, 2019   $ 1,700     $ 6,439     $     $     $ 8,139          
                                                 
Face value principal – issue date           7,000                   7,000          
Fair value adjustment – issue date           2,600                   2,600     $ (2,600 )
Installment repayments – common stock     (1,642 )                       (1,642 )        
Non-installment payments – common stock     (4 )                       (4 )        
Non-installment payments – cash           (138 )                 (138 )        
Change in fair value     9       4,699                   4,708       (4,708 )
Lender Fee - November 2019 Senior Secured Convertible Note - Series B                                   (700 )
Fair Value at March 31, 2020   $ 63     $ 20,600           $     $ 20,663          
Other Income (Expense) - Change in fair value - three months ended March 31, 2020                                           $ (8,008 )

 

The Senior Convertible Notes presented above were each accounted for under the ASC 825-10-15-4 fair value option (“FVO”) election, wherein, the financial instrument is initially measured at its issue-date estimated fair value and subsequently remeasured at estimated fair value on a recurring basis at each reporting period date, with the resulting fair value adjustment recognized as other income (expense) in the consolidated statement of operations. In this regard, as provided for by ASC 825-10-50-30(b), the estimated fair value adjustment is presented as a single line item within other income (expense) in the accompanying consolidated statement of operations. See Note 5, Financial Instruments Fair Value Measurements, for a further discussion of fair value assumptions.

 

Cares Act Paycheck Protection Program Loan

 

On April 8, 2020 the Company entered into a loan agreement with JP Morgan Chase, N.A., and received approximately $300 of proceeds, pursuant to the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) Paycheck Protection Program (“PPP”) - the “PPP Loan”. As of March 31, 2021, and to date, no principal or interest payments have been made. Additionally, the Company has submitted its PPP Loan forgiveness application on April 21, 2021 and is currently awaiting a final determination of the forgiveness application.