Company: MVIS
Filing Date: 2025-08-08
Form Type: 10-Q
Source: 0001641172-25-022632
Chunk: 21

Company: MICROVISION, INC.
Filing Date: 2025-08-08
Form: 10-Q
Item: Part I, Item 1
Chunk 21
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 the six months ended June 30, 2025 were recorded on the condensed consolidated
statement of operations.

Components

The
Note is a convertible debt instrument with multiple redemption, conversion, and put features. Certain features qualify as embedded derivatives
requiring bifurcation. Therefore, the bifurcated features are accounted for separately as a compound embedded derivative in accordance
with ASC 815, “Derivatives and Hedging” and are included in the derivative liability on the condensed consolidated balance
sheets. The host contract, which represents the Note excluding the derivative liability, is accounted for as non-convertible debt under
ASC 470, “Debt” and is included in notes payable, current and notes payable, net of current portion on the condensed consolidated
balance sheets.

Notes
Payable

Subsequent
to the modification, the host contract is recorded at the total amount repayable at maturity of $36.0 million, less any unamortized debt
discount. The debt discount is equal to the amount repayable at maturity, net of the initial fair value of the bifurcated derivative
liability. There were no material qualifying debt issuance costs resulting from the modification.

Supplemental
balance sheet information is as follows:

 SCHEDULE
OF SUPPLEMENT BALANCE SHEET

    June
    30,  
    December
    31, 
  
    (in
    thousands) 
    2025  
    2024 
  
    Amount
    repayable at maturity 
    $36,025  
    $47,575 
  
    Unamortized
    debt discount 
     (3,754) 
     (12,021)
  
    Unamortized
    issuance costs 
     -  
     (2,552)
  
    Net
    carrying amount 
    $32,271  
    $33,002 

    14

Interest
expense related to the amortization of the debt discount and issuance costs was $2.2 million
and $0.0 million
for the three months ended June 30, 2025 and 2024, respectively, and $5.7 million
and $0.0 million
for the six months ended June 30, 2025 and 2024, respectively. Total interest expense for the three and six months ended June 30,
2025 and 2024 is comprised of the following components:

 S