Debts

12 Months Ended

Mar. 31, 2023

Debt Disclosure [Abstract]

Debts

Debts

Development Loans and Revolving Credit Facility

See Note 3 - Nexperia Arrangement for details on the development term loans under the Loan and Security Agreement (“LSA”). As of March 31, 2023 and 2022, there were no term loans outstanding under the LSA.

The LSA also provided a $10.0 million revolving loan (Tranche C Loan) that was scheduled to mature at the earlier of (i) April 3, 2021, and (ii) the date a Change of Control (as defined in the LSA) of the Company occurs. Interest payable by the Company accrues on the outstanding principal amount of the loans during such period at a rate of 6% per annum. The credit facility is secured against certain of the Company’s U.S. patents not relating to MOCVD or epiwafer technology. On March 1, 2021, the maturity of the Tranche C Loan of $10.0 million was extended to May 18, 2021. On May 18, 2021, the maturity of the Tranche C Loan was extended to the earlier of April 4, 2023 and the occurrence of specified change of control events, and the $2.0 million Tranche B-1 Loan was converted into a Tranche C-1 Loan (the “Tranche C Loans” together with the Tranche C Loan) with the same terms and conditions as the existing Tranche C Loan. See Note 3 - Nexperia Arrangement for further details.

As of March 31, 2023, there was $12.0 million of principal related to the Tranche C Loans and $0.2 million of accrued interest outstanding under the LSA. The Company recorded interest expense of $0.7 million for each of the years ended March 31, 2023 and 2022.

As of March 31, 2023, the scheduled maturity, including accrued interest, of the Company’s borrowings under the revolving credit facility were as follows (in thousands):

Year Ending March 31,
2024	12,180
Total	$	12,180

On April 4, 2023, the Company paid to Nexperia the revolving loan balance in full including all accrued interest. Refer to Note 19 - Subsequent Events.

Promissory Note    

In October 2017, the Company issued an unsecured subordinated convertible promissory note to Yaskawa (the “Yaskawa Note”) for $15.0 million. The stated interest rate of the Yaskawa Note was 1.0%, and principal plus interest was due on the earlier of September 30, 2022, or the date of the occurrence of an Event of Default, Change of Control or an Initial Public Offering (all terms as defined in the Yaskawa Note). In February 2020, the Yaskawa Note was amended to be convertible at the option of the holder into a maximum of 3,076,171 shares of the Company’s common stock at a conversion price of $5.12 per share.

Pursuant to ASC 825-10-15-4, the Company elected to apply the fair value option for the promissory note and recorded a $0.6 million decrease in the fair value of the note for the year ended March 31, 2022 in other income. In connection with its promissory note obligation, the Company recorded interest expense of $0.1 million for the year ended March 31, 2022. In accordance with the terms of the promissory note, interest was added to the principal balance and is reflected in the carrying value on the consolidated balance sheet.

On October 4, 2021, the Company entered into a Note Amendment and Conversion Agreement with Yaskawa to (i) reduce the conversion price of the Yaskawa Note from $5.12 per share to $5.00 per share and (ii) remove the limitation on the maximum number of shares of the Company’s common stock that could be issued upon conversion of the Yaskawa Note. Yaskawa simultaneously elected to convert the outstanding principal amount (plus accrued but unpaid interest) under the Yaskawa Note, which as of the effective date of the conversion totaled $15.6 million, into an aggregate of 3,120,000 shares of common stock. The Company also issued to Yaskawa a warrant to purchase up to 650,000 shares of common stock at an exercise price of $6.00 per share, with a term of three years. For the year ended March 31, 2022, the Company recognized a $1.2 million gain in other income upon the conversion of the Yaskawa Note. For the year ended March 31, 2023, the Company did not record any fair value adjustments, interest, or gains related to the Yaskawa Note.