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BORROWINGS
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
BORROWINGS BORROWINGS
Borrowings consist of the following (in thousands):
December 31, 2022December 31, 2021
Total notes payable$1,915 $3,769 
Less current portion of notes payable1,600 1,900 
Notes payable, non-current$315 $1,869 
Notes Payable
In 2018, the Company entered into a $1,000 thousand note payable with a bank that was secured by all property of the Company, except for its intellectual property. The note payable’s original maturity date was July 1, 2021.
In March 2020, the Company amended the note payable and borrowed an additional $4,000 thousand. The additional $4,000 thousand borrowing changed the present value of cash flows by more than 10% and, as such, was treated as a debt extinguishment. The Company recognized a $62 thousand loss on extinguishment of debt for the year ended December 31, 2020. The Company’s notes payable to the bank were recorded at fair value as part of the extinguishment. The $4,000 thousand note payable’s original maturity date was January 1, 2023.
In April 2020, the Company entered into a deferral agreement (“Deferral Agreement”) to extend the maturity date of the original $1,000 thousand note payable to September 1, 2022 and extend the maturity date of the additional $4,000 thousand note payable to January 1, 2024. The Company accounted for the Deferral Agreement as a debt modification based on an analysis of cash flows before and after the debt modification.
The original $1,000 thousand note payable was fully repaid in September 2022, pursuant to the terms of the Deferral Agreement.
The notes payable bear interest at 0.50% below the bank’s prime rate (7.50% on December 31, 2022). The Company makes monthly interest and principal payments on the note payable based on the schedule defined in the agreement.
Annual maturities on notes payable outstanding at December 31, 2022 are as follows (in thousands):
2023$1,600 
2024333
Total maturities1,933 
Less unamortized debt premium (18)
Total notes payable$1,915 
Payroll Protection Program Loan
In April 2020, the Company entered into an unsecured promissory note under the Payroll Protection Program (“PPP Loan”) administered by the United States Small Business Administration. The principal amount of the PPP Loan was $936 thousand. The PPP Loan bore interest of 1.0% per annum and had a maturity date of April 20, 2022. In July 2021, the Company applied for and received forgiveness on the $936 thousand PPP Loan plus $12 thousand in accrued interest. The gain on extinguishment of debt of $948 thousand is recorded within other income (expense), net in the Company’s consolidated statements of operations and comprehensive loss for the year ended December 31, 2021.
Bridge Loan
In July 2021, the Company entered into a six-month $20,000 thousand bridge loan (“Bridge Loan”), maturing on the earlier of January 12, 2022 or consummation of the Business Combination, which ultimately closed on October 8, 2021. See Note 3, Business Combination. The Bridge Loan bore interest of 9%, of which 2.25% was payable monthly and 6.75% paid-in-kind (“PIK”) interest was due upon maturity. At maturity, a final payment of $1,250 thousand was due in addition to all outstanding principal and accrued interest. The Bridge Loan was paid off pursuant to the terms of the Business Combination.
The Company elected the fair value option to account for the Bridge Loan, which contained embedded derivatives. The Company recorded the Bridge Loan at fair value of $20,000 thousand at issuance. Interest expense of $1,578 thousand was recognized related to the paid in-kind interest and final payment on the Bridge Loan for the year ended December 31, 2021.