Notes Payable | 8. Notes payable The following tables summarize outstanding notes payable as of June and December (dollars in s): A s of 06 / / (dollars in s) Maturity Date Interest Rate Conversion Price Principal Remaining Debt Discount Remaining Embedded Conversion Option Carrying Value Senior secured promissory note payable, in default In default 20.50 % n/a $ 18,000 (5,666 ) - $ 12,334 Convertible promissory notes payable, in default: Total convertible promisory notes payable, in default In default 15.40 % $ 0.0538 6,445 (140 ) 218 6,523 Convertible promissory notes payable, related parties, in default: Total convertible promisory notes payable, related parties, in default In default 14.0 % $ 0.10 1,596 - - 1,596 SBA loan # February 20, 2026 1.00 % n/a 1,033 - - 1,033 Advances on future cash receipts In default n/a n/a 812 (414 ) - 398 Short-term bridge loan October 31, 2022 5.00 % n/a 1,559 (75 ) - 1,484 Total debt outstanding, including amounts in default 29,445 (6,295 ) 218 23,368 Less: current maturities, including notes in default (28,684 ) 6,295 (218 ) (22,607 ) Total long-term debt as of June $ 761 $ - $ - $ 761 As of 12 / / (dollars in s) Maturity Date Interest Rate Conversion Price Principal Remaining Debt Discount Remaining Embedded Conversion Option Carrying Value Senior secured promissory note payable, in default In default 20.25 % n/a $ 15,000 (3,414 ) - $ 11,586 Convertible promissory notes payable, in default: Total convertible promisory notes payable, in default In default 15.40 % $ 0.1071 6,445 (1,099 ) 6,255 11,601 Convertible promissory notes payable, related parties, in default: Total convertible promisory notes payable, related parties, in default In default 14.0 % $ 0.10 1,596 - - 1,596 SBA loan # February 20, 2026 1.00 % n/a 1,033 - - 1,033 Advances on future cash receipts March 11, 2022 n/a n/a 1,500 (1,054 ) - 446 Total debt outstanding, including amounts in default 25,574 (5,567 ) 6,255 26,262 Less: current maturities, including notes in default (24,699 ) 5,567 (6,255 ) (25,387 ) Total long-term debt as of December $ 875 $ - $ - $ 875 Senior secured promissory note payable, in default (“Senior Secured Note”) - On February the Company entered into a Note Extension with NH Expansion Credit Fund Holdings LP. The amount of the note was , with an interest rate of and matures on September 30, 2025 Because the combined fair value of the applicable warrants and common stock issued as part of this note exceeded the face value of the note, the additional amount beyond the face value is recorded as a loss on issuance of . Senior secured promissory note payable, in default (“Senior Secured Note-Third Amendment) – On June 30, 2022, the Company entered into the Third Amendment to the Note and Warrant Purchase and Security Agreement (the “Third NWPSA”), which amends that certain Second Amendment to the Note and Warrant Purchase and Security Agreement, dated as of February 25, 2022, (as amended, the “NWPSA”). The Third NWPSA provides for (i) the extension of the Agent’s and Holder’s forbearance of exercising their remedies arising from Existing Defaults (as defined in the NWPSA) to the earlier of (x) the occurrence of an Event of Default and (y) August 30, 2022, and (ii) the extension to file a registration statement with the Securities and Exchange Commission (“SEC”) to register the resale of the Advisor Shares (as defined in the NWPSA) no later than August 30, 2022. May 2022 Advance on Future Receipts Financing In conjunction with the 24-week agreement, the Company is obligated to remit to GCF a minimum of $59 thousand of receipts each week for the twenty-four weeks. The Company will begin making the required minimum weekly payments May 23, 2022, and is obligated to continue through October 31, 2022. Because the combined fair value of the applicable warrants issued as part of this note exceeded the original payoff value of the note, the additional amount beyond the face value is recorded as a loss on extinguishment of $211 thousand. On June 28, 2022, the Company entered into short-term loan from a group of investors in the amount of $1.5 million. The interest rate on this loan is 5% and the expiration date is October 31, 2022. Embedded Conversion Option Liability The fair value of Conversion Option liability was determined by using a binomial pricing model: At / / At / / Conversion Price (1) $ 0.05 $ 0.11 Interest Rate (annual) (2) 1.28 % 0.18 % Volatility (annual) (3) 125.00 % 289.65 % Time to Maturity (Years) 0.05 0.50 (1) Based on the terms provided in the warrant agreement to purchase common stock of the Company as of June and December (2) (3) |