v3.25.1

Note 11 - Madryn Long-term Debt and Convertible Notes | 12 Months Ended
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Dec. 31, 2024
Notes to Financial Statements |
Debt Disclosure [Text Block] | 10. MAIN STREET TERM LOAN On December 8, 2020, the Company executed the MSLP Loan Agreement, the MSLP Note, and related documents for a loan in the aggregate amount of $50,000 for which CNB will serve as a lender pursuant to the MSLP Loan. On December 9, 2020, the MSLP Loan had been funded and the transaction was closed. The MSLP Note has a term of five years and bears interest at a rate per annum equal to 30-day LIBOR plus 3%. On December 8, 2023 and December 8, 2024, the Company must make an annual payment of principal plus accrued but unpaid interest in an amount equal to fifteen percent (15%) of the outstanding principal balance of the MSLP Note (inclusive of accrued but unpaid interest). The entire outstanding principal balance of the MSLP Note at maturity, together with all accrued and unpaid interest is due and payable in full on December 8, 2025. The Company may prepay the MSLP Loan at any time without incurring any prepayment penalties. The MSLP Note provides for customary events of default, including, among others, those relating to a failure to make payment, bankruptcy, breaches of representations and covenants, and the occurrence of certain events. In addition, the MSLP Loan Agreement and MSLP Note contain various covenants that limit the Company’s ability to engage in specified types of transactions. Subject to limited exceptions, these covenants limit the Company’s ability, without CNB’s consent, to, among other things, sell, lease, transfer, exclusively license or dispose of the Company’s assets, incur, create, or permit to exist additional indebtedness, or liens, to make dividends and other restricted payments, and to make certain changes to its ownership structure. On October 4, 2023, the Company, Venus USA Inc., Venus Canada and Venus Ltd. (Venus Ltd., together with Venus USA, Venus Canada and the Company, the "Loan Parties") entered into the Loan Modification Agreement with CNB, which modified certain terms of the MSLP Loan Agreement. The primary modifications of the MSLP Loan Modification were (i) the principal payment in the amount of 15% of the outstanding principal balance of the loan originally due December 31, 2023 is deferred until maturity, (ii) the principal payment in the amount of 15% of the outstanding principal balance of the loan originally due December 31, 2024 is reduced to 7.5% with the remainder deferred until maturity, (iii) the interest rate of the loan is reset from one-month LIBOR plus three percent (3%) to one-month term Secured Overnight Financing Rate (SOFR) plus three and one-quarter percent (3.25%), and (iv) Venus USA has assigned certain of its subscription sales contracts to CNB. On January 18, 2024, the Company and the Guarantors entered into a Loan Modification Agreement (the “Loan Modification Agreement”) with CNB and Madryn. The Loan Modification Agreement amends the MSLP Loan Agreement to, among other things, satisfy the 2023 Minimum Deposit Requirements (as defined in the Loan Modification Agreement) and defer the testing of the Minimum Deposit Relationship obligations set forth in the MSLP Loan Agreement for the monthly periods ending on January 31, 2024, February 28, 2024 and March 31, 2024 until April 30, 2024. On April 23, 2024, the MSLP Loan was purchased by Madryn for an undisclosed amount from CNB with the consent of the Company. On May 24, 2024, the MSLP Loan was amended by way of a loan amendment and consent agreement (the “MSLP Loan Amendment”) with Madryn. The MSLP Loan Amendment amended the Loan Agreement to, among other things, (i) modify the May 2024 and June 2024 interest payments to be payable-in-kind, (ii) grant certain relief from the Minimum Deposit Relationship obligations through June 7, 2024. On May 24, 2024, the Company entered into the 2024 Exchange Agreement whereby the Company exchanged $52,142 in aggregate principal amount outstanding under the MSLP Loan Agreement for $17,142 in New Secured Notes and 576,986 shares of Series Y Convertible Preferred Stock. The Series Y Convertible Preferred Stock is priced at $667.26 per share, being equal to the product of (i) the average closing price (as reflected on Nasdaq.com) of the Company's common stock for the five trading days immediately preceding date of the 2024 Exchange Agreement, multiplied by (ii) 9.0909. The New Secured Notes follow the same terms as the MSLP Loan Agreement. As part of the extinguishment of principal, the Company recognized a $10.9 million non-cash loss. On June 7, 2024, the Loan Parties entered into a consent agreement with Madryn to amend the MSLP Loan Amendment to, among other things, grant certain relief from minimum liquidity requirements under the MSLP Loan Amendment. On June 21, 2024, the Loan Parties entered into an Amendment and Consent Agreement with the Lenders to, among other things, (i) modify the July 2024 interest payment to be payable-in-kind, (ii) grant relief from the Minimum Deposit Relationship obligations through July 8, 2024. On July 8, 2024, the Loan Parties entered into a loan amendment and consent agreement with the Lenders to, among other things, grant relief under the MSLP Loan Agreement, as amended, such that (i) certain minimum liquidity requirements under the MSLP Loan Agreement are waived through August 2, 2024, and (ii) certain operating covenants for the June 30, 2024 measurement period were deleted. On July 29, 2024, the Loan Parties entered into a consent agreement with the Lenders which granted relief under the MSLP Loan Agreement, such that (i) certain minimum liquidity requirements under the MSLP Loan Agreement are waived through August 30, 2024, and (ii) permit Venus USA to apply the August 8, 2024 cash interest payment due to the respective outstanding principal balance of each Note. On August 30, 2024, the Loan Parties entered into a consent agreement with the Lenders which granted relief under the MSLP Loan Agreement, such that (i) certain minimum liquidity requirements under the MSLP Loan Agreement are waived through September 30, 2024, and (ii) permit Venus USA to apply the September 8, 2024 cash interest payment due to the respective outstanding principal balance of each Note. Additionally, on September 26, 2024, the Company entered into the Second 2024 Exchange Agreement whereby the Company exchanged $17,662 of the balance outstanding under the MSLP Loan Agreement for $2,662 in aggregate principal amount outstanding under the MSLP Loan Agreement and 203,583 shares of Series Y Convertible Preferred Stock. As part of the extinguishment of principal, the Company recognized a $0.5 million non-cash loss. Also, on September 26, 2024 the Loan Parties entered into a Third Loan Amendment which, among other things, (i) modify the October 2024 interest payment to be payable-in-kind, (ii) delete the net loss covenant, and (iii) grant relief from minimum liquidity requirements. On October 31, 2024, the Loan Parties entered into a consent agreement with the Lenders which granted relief under the MSLP Loan Agreement, such that (i) certain minimum liquidity requirements under the MSLP Loan Agreement are waived through November 30, 2024, and (ii) permit Venus USA to apply the November 8, 2024 cash interest payment due to the respective outstanding principal balance of each Note. On November 26, 2024, the Loan Parties entered into a consent agreement with the Lenders which granted relief under the MSLP Loan Agreement, such that (i) certain minimum liquidity requirements under the MSLP Loan Agreement are waived through December 31, 2024, (ii) permit Venus USA to apply the December 8, 2024 cash interest payment due to the respective outstanding principal balance of each Note, and (iii) defer the previously scheduled December 2024 principal payment to maturity. On December 31, 2024, the Loan Parties entered into a consent agreement with the Lenders which granted relief under the MSLP Loan Agreement, such that (i) certain minimum liquidity requirements under the MSLP Loan Agreement are waived through January 31, 2025, and (ii) permit Venus USA to apply the January 8, 2025 cash interest payment due to the respective outstanding principal balance of each Note. As of December 31, 2024 and December 31, 2023, the Company was in compliance with all required covenants. The scheduled payments, inclusive of principal and estimated interest, on the outstanding borrowings as of December 31, 2024 are as follows:
|  | As of December 31, 2025 |
2025 |  | $ | 162 |
2026 |  |  | 2,973 |
Total |  | $ | 3,135 |
Madryn Long Term Debt and Convertible Notes [Member] |
Notes to Financial Statements |
Debt Disclosure [Text Block] | 11. MADRYN DEBT AND CONVERTIBLE NOTES Convertible Notes On October 11, 2016, Venus Ltd. entered into the Madryn Credit Agreement, pursuant to which Madryn agreed to make certain loans to certain of Venus Concept’s subsidiaries. On December 9, 2020, contemporaneously with the MSLP Loan Agreement (Note 10), the Company and its subsidiaries, Venus USA, Venus Ltd., Venus Canada, and the Madryn Noteholders (as defined below), entered into the Exchange Agreement dated as of December 8, 2020, pursuant to which the Company on December 9, 2020 (i) repaid $42.5 million aggregate principal amount owed under the Madryn Credit Agreement, and (ii) issued to the Madryn Noteholders the Notes. The Madryn Credit Agreement was terminated effective December 9, 2020 upon the funding and closing of the MSLP Loan and the issuance of the Notes. On October 4, 2023, the Company entered into the 2023 Exchange Agreement with the Madryn Noteholders. Pursuant to the 2023 Exchange Agreement, the Madryn Noteholders agreed to exchange (the "Exchange") $26.695 million in aggregate principal amount of outstanding secured convertible notes of the Company for (i) secured subordinated convertible notes in aggregate principal amount of $22.792 million (the “New Convertible Notes”) and (ii) 248,755 shares of newly-created convertible preferred stock of the Company, par value $0.0001 per share designated as "Series X Convertible Preferred Stock" (the "Series X Preferred Stock"). The Series X Preferred Stock is priced at $221.10 per share, being equal to the "Minimum Price" as set forth in Nasdaq Listing Rule 5635(d), multiplied by 0.9091. The New Convertible Notes accrue interest at a rate of 3-month adjusted term Secured Overnight Financing Rate (SOFR) plus 8.50% per annum. In the case of an event of default under the New Convertible Notes, the then-applicable interest rate will increase by four percent (4.00%) per annum. Interest is payable in kind in arrears on the last business day of each calendar quarter of each year after the original issuance date, beginning on December 31, 2023. The New Convertible Notes mature on December 9, 2025, unless earlier redeemed or converted. As part of the extinguishment of principal, the Company recognized a $2.0 million loss. On May 24, 2024, as required by the 2024 Exchange Agreement (Note 10), the New Convertible Notes were amended to, among other things, align the covenant protections in favor of the Madryn Noteholders with the MSLP Loan Agreement, as amended by the MSLP Loan Amendment. As of December 31, 2024, the Company had approximately $27.1 million principal and interest of New Convertible Notes and Notes outstanding that were issued pursuant to the 2024 Exchange Agreement. In connection with the New Convertible Notes and Notes, the Company recognized interest expense of $3,502 and $2,438 during the years ended December 31, 2024 and December 31, 2023, respectively. The conversion feature, providing the Madryn Noteholders with a right to receive the Company’s shares upon conversion of the New Convertible Notes and Notes, was qualified for a scope exception in ASC 815-10-15 and did not require bifurcation. The New Convertible Notes and Notes also contained embedded redemption features that provided multiple redemption alternatives. Certain redemption features provided the Madryn Noteholders with a right to receive cash and a variable number of shares upon change of control and an event of default (as defined in the New Notes and Notes). The Company evaluated redemption upon change of control and an event of default under ASC 815, Derivatives and Hedging, and determined that these two redemption features required bifurcation. These embedded derivatives were accounted for as liabilities at their estimated fair value as of the date of issuance, and then subsequently remeasured to fair value as of each balance sheet date, with the related remeasurement adjustment being recognized as a component of change in fair value of derivative liabilities in the consolidated statements of operations. The scheduled payments, inclusive of principal and interest, on the outstanding borrowings of the Notes and New Convertible Notes as of December 31, 2024 totals $35,176 and are due in 2026. For the years ended December 31, 2024 and 2023, the Company did not make any principal repayments. Bridge Financing On April 23, 2024, the Company entered into a Loan and Security Agreement (the “Loan and Security Agreement”), by and among Venus USA, (the “Bridge Borrower”), Venus Canada, Venus Ltd. (Venus Ltd., together with the Company and Venus Canada, the “2024 Guarantors,” and together with the Bridge Borrower, the “Bridge Financing Loan Parties”) and, each lender party thereto (collectively, the “2024 Lenders”) and Madryn Health Partners, LP, as administrative agent. Pursuant to the Loan and Security Agreement, the 2024 Lenders agreed to provide the Bridge Borrower with bridge financing in the form of a term loan in the original principal amount of $2,238 and one or more delayed draw term loans of up to an additional principal amount of $2,762 (the “Bridge Financing”). The Bridge Financing originally had a maturity date of May 26, 2024. Pursuant to the Loan and Security Agreement, each of the 2024 Guarantors, jointly and severally, guarantee, that the Obligations (as defined in the Loan and Security Agreement) will be performed and paid in full when due and payable. Borrowings under the Loan and Security Agreement will bear interest at a rate per annum equal to 12%, due at maturity. The Loan and Security Agreement also provides that all present and future indebtedness and the obligations of the Bridge Borrower to Madryn Health Partners, LP shall be secured by a priority security interest in all real and personal property collateral of the Bridge Financing Loan Parties. The Loan and Security Agreement contains customary representations, warranties and affirmative and negative covenants. In addition, the Loan and Security Agreement contains customary events of default that entitle Madryn Health Partners, LP to cause the Bridge Borrower’s indebtedness under the Loan and Security Agreement to become immediately due and payable, and to exercise remedies against the Bridge Financing Loan Parties and the collateral securing the Bridge Financing. Under the Loan and Security Agreement, an event of default will occur if, among other things, any of the Bridge Financing Loan Parties fails to make payments under the Loan and Security Agreement, any of the Bridge Financing Loan Parties breaches any of the covenants under the Loan and Security Agreement, a Change of Control (as defined in the Loan and Security Agreement) occurs, any of the Bridge Financing Loan Parties, or its assets, become subject to certain legal proceedings, such as bankruptcy proceedings. Upon the occurrence and for the duration of an event of default, a default interest rate equal to 15.0% per annum will apply to all obligations owed under the Loan and Security Agreement. On May 24, 2024, as required by the 2024 Exchange Agreement (Note 10), the Loan and Security Agreement was amended to extend the maturity date from May 26, 2024 to June 7, 2024. On June 7, 2024, the Loan Parties entered into a Second Bridge Loan Amendment Agreement which further extended the maturity date of the Bridge Financing from June 7, 2024 to June 21, 2024. On June 21, 2024, the Bridge Financing Loan Parties entered into a Third Bridge Loan Amendment Agreement with the 2024 Lenders which further extended the maturity date of the Bridge Financing from June 21, 2024 to July 8, 2024. On July 8, 2024, the Bridge Financing Loan Parties entered into a Fourth Bridge Loan Amendment Agreement (the “Fourth Bridge Loan Amendment”). The Fourth Bridge Loan Amendment amended that certain Loan and Security Agreement, dated April 23, 2024, among the Bridge Financing Loan Parties and the 2024 Lenders to extend the maturity date of the bridge loan from July 8, 2024 to August 2, 2024. On July 26, 2024, the 2024 Lenders agreed to provide the Bridge Borrower with a subsequent drawdown under the Loan and Security Agreement in the principal amount of $1,000 (the “July Drawdown”). The July Drawdown was fully funded on July 26, 2024. On July 29, 2024, the Bridge Financing Loan Parties entered into a Fifth Bridge Loan Amendment Agreement (the “Fifth Bridge Loan Amendment”). The Fifth Bridge Loan Amendment amended the Loan and Security Agreement to, among other things, (i) modify the availability period for subsequent drawdowns under the Bridge Financing from ten days to two days prior to the maturity date, (ii) increase the Delayed Draw Commitment, as defined in the Loan and Security Agreement, from $2,762 to $3,000, and (iii) extend the maturity date of the Bridge Financing from August 2, 2024 to August 30, 2024. On August 30, 2024 the Bridge Financing Loan Parties entered into a Sixth Bridge Loan Amendment Agreement which extended the maturity date of the Bridge Financing from August 30, 2024 to September 30, 2024. On September 11, 2024, the 2024 Lenders agreed to provide the Bridge Borrower with a subsequent drawdown under the Loan and Security Agreement in the principal amount of $1,000, which was fully funded on September 11, 2024. On September 26, 2024, the Bridge Financing Loan Parties entered into a Seventh Bridge Loan Amendment Agreement which extended the maturity date of the Bridge Financing from September 30, 2024 to October 31, 2024. On October 30, 2024, the 2024 Lenders agreed to provide the Bridge Borrower with a subsequent drawdown under the Loan and Security Agreement in the principal amount of $1,000, which was fully funded on November 1, 2024. On October 31, 2024, the Bridge Financing Loan Parties entered into an Eighth Bridge Loan Amendment Agreement which extended the maturity date of the Bridge Financing from October 31, 2024 to November 30, 2024. On November 26, 2024, the Bridge Financing Loan Parties entered into a Ninth Bridge Loan Amendment Agreement which (i) increased the Delayed Draw Commitment from $3,000 to $6,000, and (ii) extended the maturity date of the Bridge Financing from November 30, 2024 to December 31, 2024. The 2024 Lenders also agreed to provide the Bridge Borrower with a subsequent drawdown under the Loan and Security Agreement in the principal amount of $1,200, which was fully funded on November 26, 2024. On December 5, 2024, the 2024 Lenders agreed to provide the Bridge Borrower with a subsequent drawdown under the Loan and Security Agreement in the principal amount of $1,500, which was fully funded on December 9, 2024. On December 31, 2024, the Bridge Financing Loan Parties entered into a Tenth Bridge Loan Amendment Agreement which extended the maturity date of the Bridge Financing from December 31, 2024 to January 31, 2025. The scheduled payments, inclusive of principal and interest of $8,519 will be paid at maturity. For the year ended December 31, 2024, the Company did not make any principal payments.

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