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Long-term Debt | 3 Months Ended
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Sep. 30, 2023
Debt Disclosure [Abstract] |
Long-term Debt | 7. Long-term Debt Long-term debt consisted of the following at the end of each period presented.
|  | September 30, |  |  | June 30, |
|  | 2023 |  |  | 2023 |
|  | (in thousands) |
Convertible note |  | $ | 63,561 |  |  | $ | 61,710 |
Vehicle notes payable |  |  | 138 |  |  |  | 148 |
Total debt |  |  | 63,699 |  |  |  | 61,858 |
Current portion of debt |  |  | 41 |  |  |  | 40 |
Long-term debt |  |  | 63,658 |  |  |  | 61,818 |
Unamortized convertible note discount — embedded conversion feature |  |  | (19,447 | ) |  |  | (20,691 | )
Unamortized debt issuance costs - convertible note |  |  | (3,248 | ) |  |  | (3,456 | )
Long-term debt, net |  | $ | 40,963 |  |  | $ | 37,671 |
On August 15, 2023 the Company elected to issue additional notes as payment for $1.85 million of interest accrued during the period from February 16, 2023 through August 15, 2023. Interest expense consisted of the following.
|  | Three months ended September 30, |
|  | 2023 |  |  | 2022 |
|  | (in thousands) |
Convertible note interest |  | $ | 940 |  |  | $ | 269 |
Vehicle notes payable interest |  |  | 1 |  |  |  | 2 |
Amortization of debt issuance costs and discount — convertible note |  |  | 1,452 |  |  |  | 550 |
Other interest |  |  | 18 |  |  |  | — |
Gross interest expense |  |  | 2,411 |  |  |  | 821 |
Less: amount capitalized to construction in progress |  |  | 624 |  |  |  | — |
Interest expense, net of amounts capitalized |  | $ | 1,787 |  |  | $ | 821 |
Effective interest rate — convertible note |  |  | 23.2 | % |  |  | 23.4 | %
Convertible Note On August 11, 2022, the Company executed a $60 million private placement of Senior Secured Convertible Note (the "Note” or "Convertible Note"), with Bluescape Energy Partners. The Note, which is convertible into the Company's common stock and matures in August 2027, closed on August 26, 2022. At the Company's election, the Note bears interest at an annual rate of 4.50% if paid in cash, or at an annual rate of 6.00% if paid through the issuance of additional notes. Interest is paid semi-annually on February 15 and August 15 of each year. The Note contains a financial covenant requiring us to maintain a cash balance of at least $10 million and is secured by a security interest in substantially all of our assets. The purchaser may convert the Note at any time before August 2027 at a conversion price of $17.60 (“Conversion Price”). The Company has the right, at any time on or before the twenty-four (24) month anniversary of the closing date of the Note (“Closing Date”), to convert the Note into the Company's common stock in whole or in part if the closing price of the Company's common stock is at least 200% of the Conversion Price of the Note (“Threshold Price”) for each of the twenty (20) consecutive trading days prior to the time we deliver a conversion notice. The Threshold Price for the Company's right to convert the Note decreases to 150% after the twenty-four (24) month anniversary of the Closing Date and on or before the thirty-six (36) month anniversary of the Closing, and to 130% at any time after the thirty-six (36) month anniversary of the Closing Date. Due to a provision in the Convertible Note agreement that allowed for a change in the conversion price upon a digressive issuance by the Company within three months of the Closing Date, t he conversion feature of the Note was deemed an embedded derivative requiring separate accounting as a stand-alone derivative instrument (the "Convertible Note Derivative"). The Note was recorded at its face amount of $60 million less debt issuance costs of $4.2 million and the fair value of the Convertible Note Derivative of $24.9 million. The provision resulting in the separate accounting for the conversion feature of the Convertible Note Derivative expired November 26, 2022, and accordingly, the fair value of the Convertible Note Derivative at expiration of the provision was transferred to additional paid-in capital (see Note 8). Fair value information for the Convertible Note and Convertible Note Derivative follows.
|  | September 30, |  |  | June 30, |
|  | 2023 |  |  | 2023 |
|  | (in thousands) |
Fair value of convertible note (Level 2) |  | $ | 42,273 |  |  | $ | 40,316 |
Total fair value of convertible note instrument |  | $ | 42,273 |  |  | $ | 40,316 |
The valuation model for the Convertible Note and related Convertible Note Derivative requires the input of subjective assumptions including expected share price volatility, risk-free interest rate and debt rate. Changes in the input assumptions as well as the Company's underlying share price can materially affect the fair value estimates. Prior to the expiration of the provision that required separate accounting for the Convertible Note Derivative, the changes in fair value of the Convertible Note Derivative materially affected reported net income (loss) but had no related impact on our cash position or cash flows. Changes in the reported fair value of the Convertible Note are not recognized in net income and therefore have no effect on reported net income (loss). The significant assumptions used in the fair value model for the Convertible Note and related Convertible Note Derivative include the following, with a change in volatility and debt rate having the most significant impact on the related fair values.
|  | September 30, |  | June 30,
|  | 2023 |  | 2023
Risk-free interest rate |  | 4.8% |  | 4.4%
Volatility |  | 50.0% |  | 50.0%
Debt rate |  | 16.9% |  | 17.5%
Stock price per share |  | $2.26 |  | $3.28
On November 6, 2026, the Company entered into a standstill agreement with its Lender and holder of the Convertible Note. Refer to Notes 1 and 13 for additional information.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (h) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 235 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 1 -Subparagraph (SX 210.4-08(c)) -Publisher FASB -URI https://asc.fasb.org//1943274/2147480678/235-10-S99-1 Reference 3: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 470 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//470/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (g) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1B -Subparagraph (i) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1B Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1C -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1C Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1E -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1E Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Topic 470 -SubTopic 20 -Name Accounting Standards Codification -Section 50 -Paragraph 1I -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147481139/470-20-50-1I + Details
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