Quarterly report pursuant to Section 13 or 15(d)

Long-Term Debt

v3.21.2
Long-Term Debt
6 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Long-Term Debt

Note 8. Long-Term Debt

 

Long-term debt consists of the following:

 

    June 30, 2021     December 31, 2020  
Department of Employment and Economic Development loan   $ -     $ 83  
Economic Injury Disaster Loan     57       57  
8% 2020 Convertible Notes, $7,651 face amount, due July 2022     -       7,651  
Total long-term debt before debt issuance costs and debt discount     57       7,791  
Less: current portion of long-term debt     -       -  
Less: debt discount (net of accretion of $0 and $235, respectively)     -       (952 )
Total long-term debt   $ 57     $ 6,839  

 

Future annual principal repayments due on the long-term debt as of June 30, 2021 are as follows:

 

       
    Amount  
Remainder of 2021   $ -  
2022     -  
2023     1  
2024     1  
2025     1  
2026     1  
Thereafter     53  
Total   $ 57  

 

 

2020 Convertible Notes

 

Effective February 8, 2021 the Company’s shareholders and 2020 Convertible Note holders approved amendments to the 2020 Convertible Notes to allow for the issuance of up to $10.0 million in 2020 Convertible Notes for cash (plus up to approximately $3.9 million of 2020 Convertible Notes in exchange for the cancellation of Series B Preferred stock) as well as modifications to the financing’s terms for any 2020 Convertible Noteholder that invested at least $3.0 million of cash since May 4, 2020 in the offering (a “Major Investor”). As of March 12, 2021, the Company completed the $10.0 million 2020 Convertible Note offering. The Company raised approximately $5.0 million from the sale of 2020 Convertible Notes from January 1, 2021 through March 12, 2021 of which approximately $3.9 million were to related parties, including former StemoniX Board members as well as a more than 5% owner of Series B Preferred stock. For any Major Investor, the modified terms provide for a fixed conversion discount on the 2020 Convertible Notes of 20% and a common stock warrant equal to 20% of the amount invested in all 2020 Convertible Notes by such Major Investor divided by the weighted average share price of the Common Stock over the five trading days prior to the closing of the Merger. One 2020 Convertible Note holder that had previously invested $1.25 million in the offering invested an additional $3.0 million on February 23, 2021 and upon the Merger received a warrant to purchase 143,890 shares of the Company’s common stock at an exercise price of $5.9059 per share (the “Major Investor Warrant”). At the time of the Merger, the outstanding principal of the 2020 Convertible Notes of approximately $12.7 million plus accrued interest of $468 thousand were exchanged for 3,338,944 shares of the Company’s common stock. In connection with this exchange, the Company recorded a debt extinguishment loss of $2.5 million in the first quarter of 2021. The weighted average interest rate on the 2020 notes during the six-month period ended June 30, 2021 was 18.22%.

 

Payroll Protection Plan Loan

 

In April 2020, the Company applied for and received a $730 thousand loan under the Payroll Protection Plan (“PPP”) as part of the Coronavirus Aid, Relief, and Economic Security Act’s (“CARES Act”). Under the PPP, the Company was able to receive funds for two and a half months of payroll, rent, utilities, and interest cost. The Company has determined that the entire PPP loan will be forgiven resulting in no repayment, including the $10 thousand EIDL grant. The $730 thousand of PPP loan forgiveness was recorded as a reduction of operating costs during the second and fourth quarters of 2020. Therefore, the PPP loan is not reflected as a liability as of December 31, 2020. In April 2021 the SBA fully forgave the PPP loan.

 

Economic Injury Disaster Loan

 

In 2020 the Company received a $57 thousand Economic Injury Disaster Loan (“EIDL”) loan and a $10 thousand grant from the Small Business Administration in connection with the COVID-19 impact on the Company’s business. This loan bears interest at 3.75% and is repayable in monthly installments starting in June 2022 with a final balance due on June 21, 2050