Term Debt

3 Months Ended

Mar. 31, 2025

Debt Disclosure [Abstract]

Term Debt

9. Term Debt

Pursuant to the Note Purchase Agreement, as amended from time-to time, leading to the Third Amended and Restated Note Purchase Agreement dated December 15, 2022 (the “Third Amended and Restated Notes”), as of March 31, 2025 and December 31, 2024, the Company has notes outstanding referred to as the senior secured notes (the “Senior Secured Notes”), the delayed draw term notes (the “Delayed Draw Term Notes”), the 2022 bridge notes (the “2022 Bridge Notes”) and the 2023 Notes (as defined below), as further described below and collectively referred to as the “Term Debt”.

Senior Secured Notes

The terms of the Senior Secured Notes provide for:

● a provision for the Company to enter into Delayed Draw Term Notes (as described below);

● a provision where the Company added $13,852 to the principal balance of the notes for interest payable prior to January 1, 2022 as payable in-kind;

● a provision where the paid in-kind interest can be paid in shares of the Company’s common stock based upon the conversion rate specified in the Certificate of Designation for the Series K convertible preferred stock, subject to certain adjustments;

● an interest rate of 10.0% per annum, subject to adjustment in the event of default, with a provision that within one (1) business day after receipt of cash proceeds from any issuance of equity interests, unless waived, the Company will prepay certain obligations in an amount equal to such cash proceeds, net of underwriting discounts and commissions;

● interest on the notes payable after February 15, 2022, at the agent’s sole discretion, either (a) in cash quarterly in arrears on the last day of each fiscal quarter or (b) by continuing to add such interest due on such payment dates to the principal amount of the notes;

● a maturity date of December 31, 2026, subject to certain acceleration conditions; and

● the Company to enter into the 2022 Bridge Notes for $36,000 (as further described below).

Delayed Draw Term Notes

The terms of the Delayed Draw Term Notes provide for:

● an interest rate of 10.0% per annum, subject to adjustment in the event of default;

● interest on the notes payable after February 15, 2022, at the agent’s sole discretion, either (a) in cash quarterly in arrears on the last day of each fiscal quarter or (b) by continuing to add such interest due on such payment dates to the principal amount of the notes; and

● a maturity date on December 31, 2026, subject to certain acceleration terms.

2022 Bridge Notes

The terms of the 2022 Bridge Notes provide for:

● an interest rate fixed at 10.0% per annum (as amended from interest that was payable in cash at an interest rate of 12% per annum quarterly; with interest rate increases of 1.5% per annum on March 1, 2023, May 1, 2023, and July 1, 2023, pursuant to the First Amendment, (as further described below);

● a maturity date of December 31, 2026, subject to certain mandatory prepayment requirements, including, but not limited to, a requirement that the Company apply the net proceeds from certain debt incurrences or equity offerings to repay the notes; and

● an election to prepay the notes, at any time, in whole or in part with no premium or penalty.

2023 Notes

The terms of the 2023 Notes, pursuant to Amendment No. 1 under the Third Amended and Restated Notes dated August 14, 2023, provide for:

● an interest rate fixed at 10.0% per annum;

● a maturity date of December 31, 2026; and

● an election to prepay the 2023 Notes, at any time, at 100% of the principal amount due with no premium or penalty.

The following table summarizes the Term Debt:

	As of March 31, 2025							As of December 31, 2024
	Principal Balance		Unamortized Discount and Debt Issuance Costs			Carrying Value		Principal Balance		Unamortized Discount and Debt Issuance Costs			Carrying Value
Senior Secured Notes, effective interest rate of 10.1% as of March 31, 2025, as amended	$	62,691	$	(160	)	$	62,531	$	62,691	$	(181	)	$	62,510
Delayed Draw Term Notes, effective interest rate of 10.2% as March 31, 2025, as amended		4,000		(18	)		3,982		4,000		(21	)		3,979
2022 Bridge Notes, effective interest rate of 10.1% as of March 31, 2025, as amended		36,000		(46	)		35,954		36,000		(53	)		35,947
2023 Notes, effective interest rate of 14.2% as of March 31, 2025 , as amended		8,000		-			8,000		8,000		-			8,000
Total	$	110,691	$	(224	)	$	110,467	$	110,691	$	(255	)	$	110,436

The debt issuance costs incurred, as amended based on certain debt modifications, are being amortized over the applicable term of the Term Debt.

On December 29, 2023, the Company failed to make the interest payment due on the Term Debt resulting in an event of default with subsequent agreement to a forbearance period that was extended to September 30, 2024. On July 12, 2024, the Company entered into a third amendment to the Third Amended and Restated Notes dated as of December 15, 2022 (“Amendment No. 3”) which further deferred the accrued interest due date to December 31, 2024. On November 6, 2024, the Company received a letter from Renew (as described below) confirming the Company was not then in default under the Term Debt due to the cure of the default identified in the forbearance letter (as updated from time-to-time the “forbearance letter”), and all interest was paid as of December 31, 2024. Further details are provided under the heading Principal Stockholders in Note 15.

As of March 31, 2025, the Term Debt principal maturity of $110,691 is due on December 31, 2026.

Information for the three months ended March 31, 2025 and 2024 with respect to interest expense related to the Term Debt is provided below.

Interest Expense

The following table represents interest expense:

	Three Months Ended March 31,
	2025		2024
Amortization of debt costs:
Line of credit	$	-	$	418
Term Debt		31		118
Total amortization of debt costs		31		536
Noncash and accrued interest:
Simplify Loan		-		41
Term Debt		-		2,798
Total noncash and accrued interest		-		2,839
Cash paid interest:
Simplify Loan		194		-
Line of credit		-		795
Term Debt		2,767		-
Other		12		169
Total cash paid interest		2,973		964
Total interest expense	$	3,004	$	4,339