Unsecured Promissory Note

3 Months Ended

Mar. 31, 2024

Debt Disclosure [Abstract]

Unsecured Promissory Note

Note 9: Unsecured Promissory Note

On February 16, 2024, the Company (“Borrower”) entered into a Note Purchase Agreement with Streeterville Capital LLC (“Streeterville”or the “Lender”). Under the terms of the agreement, Streeterville paid the Company $2,500,000 in exchange for an unsecured promissory Note with an Original Issue Discount of $781,250. The Company will pay $3,301,250 consisting of the principal amount of the Note, together with the original issue discount and $20,000 of lender transaction fees, no later than February 16, 2026. The stated interest rate of the note is 10%.

The following table summarizes our debt at March 31, 2024 and December 31, 2023:

(in thousands)

	March 31, 2024			December 31, 2023
Long-term debt	$	3,330		$	-
Unamortized Original issue discount		(738	)		-
Unamortized Financing fees		(19	)		-
		2,573			-
Less current portion of long-term debt, net (1)		(1,623	)		-
Long-term debt (2)	$	950		$	-

Interest costs expensed and capitalized related to long-term debt were as follows:

(in thousands)

	March 31, 2024		December 31, 2023
Interest expense	$	29	$	-
Interest capitalized		-		-
Total	$	29	$	-

Amortization expenses related to long-term debt were as follows:

(in thousands)

	March 31, 2024		December 31, 2023
Original issue discount	$	43	$	-
Loan fee amortization		1		-
	$	44	$	-

Future maturities of long-term debt as of March 31, 2024 were as follows:

(in thousands)

Fiscal years ending December 31:
2024	$	1,250
2025		2,080
Total	$	3,330

(1)	Current portion of long-term debt of approximately $2,000,000 is net of the current portion of debt discount of approximately $367,000 and the current portion of debt origination costs of approximately $10,000 as of March 31, 2024.
(2)	Long-term portion of debt of approximately $1,330,000 is net of the long-term portion of debt discount of approximately $371,000 and the unamortized debt origination costs of approximately $9,000 as of March 31, 2024.

The agreement allows the Lender to redeem up to $250,000 per calendar month beginning in August 2024, upon providing written notice to Borrower. The Note further contains triggering events which can be remedied by the Lender requiring the Borrower to correct the triggering event, increasing the outstanding balance by applying the triggering effect, or making the Note immediately due and payable.