UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the quarterly period ended
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to
Commission File Number
(Exact name of Registrant as specified in its Charter)
| ||
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices including zip code)
Registrant’s telephone number, including area code: (
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
Indicate by check mark whether the Registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. ☒ NO ☐
Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). ☒ NO ☐
Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer | ☐ | Accelerated filer | ☐ | |
☒ | Smaller reporting company | |||
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. | ☐ |
Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES
The number of shares of the Registrant’s Common Stock outstanding as of August 9, 2022, was
Table of Contents
In this Quarterly Report on Form 10-Q, “we,” “our,” “us,” “Everspin Technologies,” and “the Company” refer to Everspin Technologies, Inc. The Everspin logo and other trade names, trademarks or service marks of Everspin Technologies are the property of Everspin Technologies, Inc. This report contains references to our trademarks and to trademarks belonging to other entities. Trade names, trademarks and service marks of other companies appearing in this report are the property of their respective holders. We do not intend our use or display of other companies’ trade names or trademarks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.
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PART I—FINANCIAL INFORMATION
Item 1. Financial Statements
EVERSPIN TECHNOLOGIES, INC.
Condensed Balance Sheets
(In thousands, except share and per share amounts)
(Unaudited)
June 30, | December 31, | |||||
2022 | 2021 | |||||
Assets |
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Current assets: |
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Cash and cash equivalents | $ | | $ | | ||
Accounts receivable, net |
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Inventory |
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Prepaid expenses and other current assets |
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Total current assets |
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Property and equipment, net |
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Right-of-use assets | |
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Other assets |
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Total assets | $ | | $ | | ||
Liabilities and Stockholders’ Equity |
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Current liabilities: |
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Accounts payable | $ | | $ | | ||
Accrued liabilities |
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Deferred revenue | — | | ||||
Current portion of long-term debt |
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Lease liabilities | | | ||||
Other liabilities | | | ||||
Total current liabilities |
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Long-term debt, net of current portion |
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Lease liabilities, net of current portion | | | ||||
Long-term income tax liability | | | ||||
Total liabilities | $ | | $ | | ||
Commitments and contingencies |
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Stockholders’ equity: |
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Preferred stock, $ | ||||||
Common stock, $ |
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Additional paid-in capital |
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Accumulated deficit |
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Total stockholders’ equity |
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Total liabilities and stockholders’ equity | $ | | $ | | ||
The accompanying notes are an integral part of these condensed financial statements.
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EVERSPIN TECHNOLOGIES, INC.
Condensed Statements of Operations and Comprehensive Income (Loss)
(In thousands, except share and per share amounts)
(Unaudited)
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Product sales | $ | | $ | | $ | | $ | | ||||
Licensing, royalty, patent, and other revenue | | | |
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Total revenue |
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Cost of product sales | | | | | ||||||||
Cost of licensing, royalty, patent, and other revenue | | | | | ||||||||
Total cost of sales |
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Gross profit |
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Operating expenses:1 |
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Research and development |
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General and administrative |
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Sales and marketing |
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Total operating expenses |
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Income from operations |
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Interest expense |
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Other income (expense), net | | ( |
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Net income (loss) before income taxes | | | | ( | ||||||||
Income tax expense | — | ( | — | ( | ||||||||
Net income (loss) and comprehensive income (loss) | $ | | $ | | $ | | $ | ( | ||||
Net income (loss) per common share: | ||||||||||||
Basic | $ | | $ | | $ | | $ | ( | ||||
Diluted | $ | | $ | | $ | | $ | ( | ||||
Weighted average shares of common stock outstanding: | ||||||||||||
Basic |
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Diluted |
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1Operating expenses include stock-based compensation as follows: | ||||||||||||
Research and development | $ | | $ | | $ | | $ | | ||||
General and administrative | | | | | ||||||||
Sales and marketing | | | | | ||||||||
Total stock-based compensation | $ | | $ | | $ | | $ | | ||||
The accompanying notes are an integral part of these condensed financial statements.
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EVERSPIN TECHNOLOGIES, INC.
Condensed Statements of Stockholders’ Equity
(In thousands, except share and per share amounts)
(Unaudited)
Six Months Ended June 30, 2022 | ||||||||||||||
Additional | Total | |||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||
| Shares |
| Amount |
| Capital |
| Deficit |
| Equity | |||||
Balance at December 31, 2021 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock options | | — | | — | | |||||||||
Issuance of common stock under stock incentive plans | | — | — | — | — | |||||||||
Stock-based compensation expense | — | — | | — | | |||||||||
Net income | — | — | — | | | |||||||||
Balance at March 31, 2022 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock options | | — | | — | | |||||||||
Issuance of common stock under stock incentive plans | | — | | — | | |||||||||
Stock-based compensation expense | — | — | | — | | |||||||||
Net income | — | — | — | | | |||||||||
Balance at June 30, 2022 | | $ | | $ | | $ | ( | $ | | |||||
Six Months Ended June 30, 2021 | ||||||||||||||
Additional | Total | |||||||||||||
Common Stock | Paid-In | Accumulated | Stockholders’ | |||||||||||
| Shares |
| Amount |
| Capital |
| Deficit |
| Equity | |||||
Balance at December 31, 2020 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock options | | — | | — | | |||||||||
Issuance of common stock under stock incentive plans | | — | | — | | |||||||||
Stock-based compensation expense | — | — | | — | | |||||||||
Net loss | — | — | — | ( | ( | |||||||||
Balance at March 31, 2021 | | $ | | $ | | $ | ( | $ | | |||||
Exercise of stock options | | — | | — | | |||||||||
Issuance of common stock under stock incentive plans | | — | | — | | |||||||||
Stock-based compensation expense | — | — | | — | | |||||||||
Net income | — | — | — | | | |||||||||
Balance at June 30, 2021 | | $ | | $ | | $ | ( | $ | | |||||
The accompanying notes are an integral part of these condensed financial statements.
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EVERSPIN TECHNOLOGIES, INC.
Condensed Statement of Cash Flows
(In thousands)
(Unaudited)
Six Months Ended June 30, | ||||||
| 2022 |
| 2021 | |||
Cash flows from operating activities |
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Net income (loss) | $ | | $ | ( | ||
Adjustments to reconcile net income (loss) to net cash provided by operating activities: |
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Depreciation and amortization |
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Gain on sale of property and equipment |
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Stock-based compensation |
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Non-cash warrant revaluation | ( | | ||||
Non-cash interest expense |
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Changes in operating assets and liabilities: |
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Accounts receivable |
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Inventory |
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Prepaid expenses and other current assets |
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Other assets |
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Accounts payable |
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Accrued liabilities |
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Deferred revenue | ( | | ||||
Lease liabilities | | ( | ||||
Net cash provided by operating activities |
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Cash flows from investing activities |
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Purchases of property and equipment |
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Proceeds received from sale of property and equipment | | — | ||||
Net cash used in investing activities |
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Cash flows from financing activities |
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Payments on long-term debt |
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Proceeds from exercise of stock options and purchase of shares in employee stock purchase plan |
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Net cash used in financing activities |
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Net increase (decrease) in cash and cash equivalents |
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Cash and cash equivalents at beginning of period |
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Cash and cash equivalents at end of period | $ | | $ | | ||
Supplementary cash flow information: |
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Interest paid | $ | | $ | | ||
Operating cash flows paid for operating leases | $ | | $ | | ||
Financing cash flows paid for finance leases | $ | | $ | — | ||
Non-cash investing and financing activities: |
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Right-of-use assets obtained in exchange for operating lease liabilities | $ | | $ | — | ||
Right-of-use assets obtained in exchange for finance lease liabilities | $ | | $ | — | ||
Purchases of property and equipment in accounts payable and accrued liabilities | $ | | $ | — | ||
Bonus settled in shares of common stock | $ | — | $ | | ||
The accompanying notes are an integral part of these condensed financial statements.
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EVERSPIN TECHNOLOGIES, INC.
Notes to Unaudited Condensed Financial Statements
1. Organization and Nature of Business
Everspin Technologies, Inc. (the Company) was incorporated in Delaware on May 16, 2008. The Company’s magnetoresistive random-access memory (MRAM) solutions offer the persistence of non-volatile memory with the speed and endurance of random-access memory (RAM) and enable the protection of mission critical data particularly in the event of power interruption or failure. The Company’s MRAM solutions allow its customers in key markets, such as industrial, medical, automotive/transportation, aerospace and data center markets to design high performance, power efficient and reliable systems without the need for bulky batteries or capacitors.
2. Summary of Significant Accounting Policies
Basis of Presentation
The accompanying unaudited condensed financial statements have been prepared in accordance with generally accepted accounting principles in the United States of America (GAAP) and applicable rules and regulations of the Securities and Exchange Commission (SEC) regarding interim financial reporting. As permitted under those rules, certain footnotes or other financial information that are normally required by GAAP have been condensed or omitted, and accordingly the balance sheet as of December 31, 2021, has been derived from the audited financial statements at that date but does not include all of the information required by GAAP for complete financial statements. These unaudited interim condensed financial statements have been prepared on the same basis as the Company’s annual financial statements and, in the opinion of management, reflect all adjustments (consisting only of normal recurring adjustments) that are necessary for a fair statement of the Company’s financial information. The results of operations for the three and six months ended June 30, 2022, are not necessarily indicative of the results to be expected for the year ending December 31, 2022 or for any other interim period or for any other future year.
The accompanying condensed financial statements and related financial information should be read in conjunction with the audited financial statements and the related notes thereto for the year ended December 31, 2021, included in the Company’s Annual Report on Form 10-K filed with the SEC.
The Company believes that its existing cash and cash equivalents as of June 30, 2022, coupled with its anticipated growth and sales levels and availability under its credit facility, will be sufficient to meet its anticipated cash requirements for at least the next 12 months from the financial statement issuance date. The Company’s future capital requirements will depend on many factors, including its growth rate, the timing and extent of its spending to support research and development activities, the timing and cost of establishing additional sales and marketing capabilities, and the introduction of new products. The Company may be required at some point in the future to seek additional equity or debt financing, to sustain operations beyond that point, and such additional financing may not be available on acceptable terms or at all. If the Company is unable to raise additional capital or generate sufficient cash from operations to adequately fund its operations, it will need to curtail planned activities to reduce costs. Doing so will likely harm its ability to execute on its business plan.
Use of Estimates
The preparation of the condensed financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the condensed financial statements and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates its estimates, including those related to revenue recognition, fair value of assets and liabilities, inventory reserves, product warranty reserves, deferred tax assets and related valuation allowances, and stock-based compensation. The Company believes its estimates and assumptions are reasonable; however, actual results may differ from the Company’s estimates.
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Accounts receivable, net
The Company establishes an allowance for product returns. The Company analyzes historical returns, current economic trends and changes in customer demand and acceptance of products when evaluating the adequacy of sales returns. Returns are processed as credits on future purchases and, as a result, the allowance is recorded against the balance of trade accounts receivable. In addition, the Company, from time to time, may establish an allowance for estimated price adjustments related to its distributor agreements. The Company estimates credits to distributors based on the historical rate of credits provided to distributors relative to sales and evaluation of current market conditions.
Accounts receivable, net consisted of the following (in thousands):
June 30, | December 31, | |||||
2022 | 2021 | |||||
Trade accounts receivable | $ | | $ | | ||
Unbilled accounts receivable | | | ||||
Other receivables |
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Allowance for product returns and price adjustments | ( | ( | ||||
Accounts receivable, net | $ | | $ | | ||
Concentration of Credit Risk
Financial instruments that potentially expose the Company to a concentration of credit risk consist principally of cash and cash equivalents that are held by a financial institution in the United States and accounts receivable. Amounts on deposit with a financial institution may at times exceed federally insured limits. The Company maintains its cash accounts with high credit quality financial institutions and, accordingly, minimal credit risk exists with respect to the financial institutions.
Significant customers are those which represent more than 10% of the Company’s total revenue or net accounts receivable balance at each respective balance sheet date. For the purposes of this disclosure, the Company defines “customer” as the entity that is purchasing the products or licenses directly from the Company, which includes the distributors of the Company’s products in addition to end customers that the Company sells to directly. For each significant customer, revenue as a percentage of total revenue and accounts receivable as a percentage of total accounts receivable, net are as follows:
Revenue | Accounts Receivable, net |
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Three Months Ended | Six Months Ended | As of |
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June 30, | June 30, | June 30, | December 31, | ||||||||||||
Customers |
| 2022 |
| 2021 |
| 2022 |
| 2021 |
| 2022 |
| 2021 |
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Customer A |
| | % | | % | | % | | % | | % | | % | ||
Customer B |
| | % | | % | ||||||||||
Customer C | | % | |||||||||||||
Customer D | | % | |||||||||||||
Customer E | | % | | % | |||||||||||
Customer F | | % | |||||||||||||
* | Less than 10% |
Fair Value of Financial Instruments
Fair value is defined as an exit price, representing the amount that would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market participants. The framework for measuring fair value provides a three-tier hierarchy prioritizing inputs to valuation techniques used in measuring fair value as follows:
Level 1— Observable inputs such as quoted prices for identical assets or liabilities in active markets;
Level 2— Inputs, other than quoted prices for identical assets or liabilities in active markets, which are observable either directly or indirectly; and
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Level 3— Unobservable inputs in which there is little or no market data requiring the reporting entity to develop its own assumptions.
As of June 30, 2022, based on Level 2 inputs and the borrowing rates available to the Company for loans with similar terms and consideration of the Company’s credit risk, the carrying value of the Company’s variable interest rate debt, excluding unamortized debt issuance costs, approximates fair value. The Company’s financial instruments consist of Level 1 assets and a Level 3 liability. Level 1 assets consist of highly liquid money market funds that are included in cash equivalents. The Company’s Level 3 liability consists of warrants issued in connection with the Company’s current credit facility (Note 6).
The following tables sets forth the fair value of the Company’s financial assets and liabilities measured at fair value on a recurring basis (in thousands):
June 30, 2022 | ||||||||||||
| Level 1 |
| Level 2 |
| Level 3 |
| Total | |||||
Assets: |
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Money market funds | $ | |
| $ | — |
| $ | — |
| $ | | |
Total assets measured at fair value | $ | |
| $ | — |
| $ | — |
| $ | | |
Liabilities: |
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Warrant liability | $ | — |
| $ | — |
| $ | |
| $ | | |
Total liabilities measured at fair value | $ | — |
| $ | — |
| $ | |
| $ | | |
December 31, 2021 | ||||||||||||
| Level 1 |
| Level 2 |
| Level 3 |
| Total | |||||
Assets: |
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Money market funds | $ | |
| $ | — |
| $ | — |
| $ | | |
Total assets measured at fair value | $ | |
| $ | — |
| $ | — |
| $ | | |
Liabilities: |
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Warrant liability | $ | — |
| $ | — |
| $ | |
| $ | | |
Total liabilities measured at fair value | $ | — |
| $ | — |
| $ | |
| $ | | |
Recently Issued Pronouncements
In June 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2016-13, Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which amends the incurred loss impairment methodology in current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. As the Company is a smaller reporting company, ASU 2016-13 is effective for the Company’s annual reporting periods, and interim periods within those years, beginning after December 15, 2022, and requires a cumulative effect adjustment to the balance sheet as of the beginning of the first reporting period in which the guidance is effective. In April 2019, the FASB issued ASU 2019-04, Codification Improvements Financial Instruments-Credit Losses (Topic 326). ASU 2019-04 provides narrow-scope amendments to help apply ASU 2016-13, and is effective with the adoption of ASU 2016-13. The Company is evaluating the impact of the adoption of ASU 2016-13 and ASU 2019-04 on its condensed financial statements.
The Company reviewed all other recently issued accounting pronouncements and concluded that they were either not applicable or not expected to have a significant impact to the condensed financial statements.
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3. Revenue
The Company sells products to its distributors and original equipment manufacturers (OEMs). The Company also recognized revenue under licensing, patent, and royalty agreements with some customers.
The following table presents the Company’s revenues disaggregated by sales channel (in thousands):
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Distributor | $ | | $ | | $ | | | |||||
Non-distributor | | | | | ||||||||
Total revenue | $ | | $ | | $ | | $ | | ||||
The following table presents the Company’s revenues disaggregated by timing of recognition (in thousands):
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Point in time | $ | | $ | | $ | | | |||||
Over time | | | | | ||||||||
Total revenue | $ | | $ | | $ | | $ | | ||||
The following table presents the Company’s revenues disaggregated by type (in thousands):
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
Product sales | $ | | $ | | $ | | $ | | ||||
Licensing | | — | | — | ||||||||
Royalties | | | | | ||||||||
Other revenue | | | | | ||||||||
Total revenue | $ | | $ | | $ | | $ | | ||||
The Company recognizes revenue in
Three Months Ended June 30, | Six Months Ended June 30, | |||||||||||
| 2022 |
| 2021 |
| 2022 |
| 2021 | |||||
APAC | $ | | $ | | $ | | $ | | ||||
North America | | | | | ||||||||
EMEA | | | | | ||||||||
Total revenue | $ | | $ | | $ | | $ | | ||||
4. Balance Sheet Components
Inventory
Inventory consisted of the following (in thousands):
June 30, | December 31, | |||||
| 2022 |
| 2021 | |||
Raw materials | $ | | $ | | ||
Work-in-process |
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Finished goods |
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Total inventory | $ | | $ | | ||
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Accrued Liabilities
Accrued liabilities consisted of the following (in thousands):
June 30, | December 31, | |||||
| 2022 |
| 2021 | |||
Payroll-related expenses | $ | | $ | | ||
Inventory | | | ||||
Other |
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Total accrued liabilities | $ | | $ | | ||
Deferred Revenue
During the year ended December 31, 2021, the Company executed contractual arrangements with a customer for the development of a RAD-Hard product, consisting of a technology license, design license agreement and development subcontract. The Company does not share in the rights to future revenues or royalties. The total arrangements are for $
The Company concluded these contractual arrangements represent one arrangement and evaluated its promises to the customer and whether the performance obligations granted under the arrangement were distinct. The licenses provided to the customer are not transferable, are of limited value without the promised development services, and the customer cannot benefit from the license agreements without the specific obligated services in the development subcontract, as there is strong interdependency between the licenses and the development subcontract. Accordingly, the Company determined the licenses were not distinct within the context of the contract and combined the license with other performance obligations. The total transaction price of $
The Company recognizes revenue related to the performance obligations over time using the input method based on costs incurred to date relative to the total expected costs of the contract and began recognizing revenue in the second quarter of 2021 over the performance obligation period. This method depicts performance under the contract and requires the Company to make estimates about the future costs expected to be incurred to perform under the contact, including labor and material costs.
As of June 30, 2022, the Company has billed $
5. Leases
Operating leases consist primarily of office space expiring at various dates through 2029. Finance leases relate to a server lease expiring in January 2025. The Company’s lease agreements do not contain any material residual value guarantees or material restrictive covenants.
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The undiscounted future non-cancellable lease payments under the Company’s operating and finance leases were as follows (in thousands):
As of June 30, 2022 |
| Amount | |
2022 | $ | | |
2023 | | ||
2024 | | ||
2025 | | ||
2026 | | ||
Thereafter | | ||
Total lease payments | | ||
Less: imputed interest | ( | ||
Total lease liabilities | | ||
Less: current portion of lease liabilities | ( | ||
Total lease liabilities, net of current portion | $ | | |
Other information related to the Company’s operating lease liabilities was as follows:
June 30, | December 31, | |||||
| 2022 |
| 2021 | |||
Weighted-average remaining lease term (years) |
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Weighted-average discount rate | % | % | ||||
Other information related to the Company’s finance lease liabilities was as follows:
June 30, | December 31, | |||||
| 2022 |
| 2021 | |||
Weighted-average remaining lease term (years) |
| — |
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Weighted-average discount rate | % | — | % | |||
6. Debt
2019 Credit Facility
In August 2019, the Company executed an Amended and Restated Loan and Security Agreement (2019 Credit Facility), which amended and restated the Company’s prior loan and security agreement (2017 Credit Facility), providing for a formula revolving line of credit (Line of Credit) and a term loan (2019 Term Loan) with Silicon Valley Bank (SVB).
In July 2020, the Company executed the first amendment to the 2019 Credit Facility with SVB. The amendment, among other things, extended the initial
The Line of Credit required a commitment fee of
In July 2021, the Company executed the second amendment to the 2019 Credit Facility with SVB. The amended Line of Credit allows for a maximum draw of $
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The amended 2019 Term Loan provides for a $
In conjunction with entering into the 2019 Credit Facility, on August 5, 2019, the Company and SVB amended and restated the warrant issued to SVB in connection with the first amendment to the 2017 Credit Facility, which was a warrant to purchase
Additionally, in conjunction with entering into the first amendment to the 2019 Credit Facility, on July 15, 2020, the Company issued an additional warrant to SVB to purchase
On July 22, 2021, SVB elected to exercise the warrant associated with the first amendment to the 2019 Credit Facility, which resulted in a net cashless exercise of the warrant and the issuance of
Collateral for the 2019 Credit Facility includes all of the Company’s assets except for intellectual property. The Company is required to comply with certain covenants under the 2019 Credit Facility, including requirements to maintain a minimum cash balance and availability under the Line of Credit, and restrictions on certain actions without the consent of the lender, such as limitations on its ability to engage in mergers or acquisitions, sell assets, incur indebtedness, or grant liens or negative pledges on its assets, make loans or make other investments. Under these covenants, the Company is prohibited from paying cash dividends with respect to its capital stock. The Company was in compliance with all covenants as of June 30, 2022. The 2019 Credit Facility contains a material adverse effect clause which provides that an event of default will occur if, among other triggers, an event occurs that could reasonably be expected to result in a material adverse effect on the Company’s business, operations, or condition, or on the Company’s ability to perform its obligations under the 2019 Term Loan. As of June 30, 2022, management does not believe that it is probable that the clause will be triggered within the next 12 months.
The amortization of the debt issuance costs and accretion of the debt discount is included in interest expense within the statements of operations and comprehensive income (loss) and included in non-cash interest expense within the statement of cash flows.
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