NOTE RECEIVABLE

9 Months Ended

Sep. 30, 2023

Disclosure Note Receivable [Abstract]

Note receivable, net consists of the following:


	September 30, 2023		December 31, 2022
Note receivable-current	$	3,377	$	2,979
Current period change for expected credit losses(1)	(68)		—
Note receivable-non-current	—		3,574
Total	$	3,309	$	6,553

(1) Upon adoption of CECL on January 1, 2023, the Company recorded a reserve for estimated expected credit losses associated with the note receivable.

Effective January 1, 2019, the Company restructured its China distribution efforts by entering into two separate economic agreements as they relate to the commercialization of Celsius products (i.e., the license agreement and repayment of investment agreement with Qifeng). See Note 4. Revenue for information regarding the license agreement with Qifeng. Under a separate economic agreement, Qifeng has agreed to repay the marketing investments made by Celsius into the China market through 2018, over a five-year period. The repayment, which was formalized via a note receivable from Qifeng (the "Note"), will need to be serviced even if the licensing agreement is cancelled or terminated. The Note is denominated in Chinese Yuan.

The Note requires annual principal payments due on March 31 of each year, with the final payment scheduled for 2024. The note receivable is recorded at amortized cost. Interest income generated from the Note has been immaterial.

The Company assesses the note receivable for impairment at each reporting period. This evaluation considers the probability that the Company will collect all scheduled contractual principal and interest payments, based on historical experience of Qifeng’s ability to pay, the current economic environment, forward-looking information, and other factors. If the Note is determined to be impaired, the impairment is measured based on the present value of the expected future cash flows under the Note, discounted at the Note’s effective interest rate. At September 30, 2023 and December 31, 2022, the Note was not deemed to be impaired outside of the allowance for expected credit losses. Payment in-full was received for the amounts due on March 31, 2023.