Simplify Loan

9 Months Ended

Sep. 30, 2024

Simplify Loan

Simplify Loan

12. Simplify Loan

On August 19, 2024, the Company entered into an amended and restated promissory note (the “Amended Promissory Note”), in connection with the amendment to the March 13, 2024 working capital loan agreement with Simplify, a related party as further described in Note 18 (the “Simplify Loan”), pursuant to which the Company has available up to $50,000 (originally $25,000) at ten percent (10.0%) interest rate per annum (the “Applicable Interest Rate”), payable monthly in arrears with a maturity on December 1, 2026 (originally March 13, 2026). The Simplify Loan is secured by certain assets of the Company and its subsidiaries, which are also guarantors of the obligations. In connection with the Amended Promissory Note, on August 19, 2024, the Company and Simplify also entered into a common stock purchase agreement (the “Common Stock Purchase Agreement”), whereby $15,000 of outstanding indebtedness under the Simplify Loan was exchanged for shares of the Company’s common stock, as further described under the heading Common Stock Purchase Agreement in Note 14 and under the heading Simplify Loan Exchange for Common Stock in Note 18. In the event of a default, including but not limited to the failure to pay any amounts when due, the interest will accrue at the Applicable Interest Rate plus five percent (5.0%) and the Simplify Loan will be payable upon demand by Simplify. As of September 30, 2024, the balance outstanding on the Simplify Loan was $1,100.

In connection with the closing of the Simplify Loan, the Company borrowed $3,448 to repay the outstanding loan balance, accrued interest, certain fees and contingency reserves under the Line of Credit.

Information for the three months and nine months ended September 30, 2024 and 2023 with respect to interest expense related to the debt is provided below.

Interest Expense

The following table represents interest expense:

	Three Months Ended September 30,					Nine Months Ended September 30,
	2024		2023			2024		2023
Amortization of debt costs:
Line of Credit	$	-	$	54		$	418	$	161
2023 Notes		-		64			113		64
Senior Secured Notes		23		228			68		676
Delayed Draw Term Notes		2		26			8		77
2022 Bridge Notes		5		161			19		1,200
Total amortization of debt costs		30		533			626		2,178
Noncash and accrued interest:
2023 Notes		204		-			608		-
Senior Secured Notes		1,601		-			4,771		-
Delayed Draw Term Notes		102		-			304		-
2022 Bridge Notes		920		-			2,740		-
Other		-		152			-		754
Total noncash and accrued interest		2,827		152			8,423		754
Cash paid interest:
Line of Credit		-		598			1,706		1,345
Simplify Loan		189		-			552		-
2023 Notes		-		44			-		44
Senior Secured Notes		-		1,602			-		4,754
Delayed Draw Term Notes		-		102			-		303
2022 Bridge Notes		-		1,317			-		3,764
Other		113		32			440		421
Total cash paid interest (1)		302		3,695			2,698		10,631
Less interest income (2)		-		(338	)		-		(338	)
Total interest expense	$	3,159	$	4,042		$	11,747	$	13,225

⁽¹⁾ During the three months ended September 30, 2024, prior accrued interest of $363 related to the Simplify Loan was paid in cash, resulting in $665 of total cash paid interest.

⁽²⁾ During the three and nine months ended September 30, 2023, the Company recorded interest income of $338 related to refunds received from the employee retention credits.