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Long-Term Debt | 6 Months Ended
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Jun. 30, 2025
Debt Disclosure [Abstract] |
Long-Term Debt | Long-Term Debt The carrying value of debt presented within current portion of notes payable and long-term indebtedness, net of debt discounts on the condensed consolidated balance sheets as of June 30, 2025 and December 31, 2024 includes the following components:
| As of June 30, 2025 |  | As of December 31, 2024
| (amounts in thousands)
Term loan Initial Draw - January 18, 2023 | $ | 200,000 |  |  | $ | 200,000 |
Exit fee on term loan - January 18, 2023 | 2,000 |  |  | 2,000 |
Term loan Subsequent Draw - March 5, 2024 | 200,000 |  |  | 200,000 |
Exit fee on term loan - March 5, 2024 | 2,000 |  |  | 2,000 |
Less: Amortized debt discounts and financing costs (1) | (30,583) |  |  | (30,863) |
Net debt | $ | 373,417 |  |  | $ | 373,137 |
Compound bifurcated derivative liability | $ | — |  |  | $ | 6,058 |
(1) Includes debt discounts of $28.3 million associated with the initial carrying value of compound bifurcated derivative liability.
Maturities of the Company’s debt are expected to be as follows as of June 30, 2025:
| Amount
Years Ending December 31, |
Remainder of 2025 | $ | — |
2026 | — |
2027 | — |
2028 | 400,000 |
2029 | — |
Term Loan On January 18, 2023, the Company entered into the New Term Loan Agreement with OrbiMed Royalty & Credit Opportunities III, LP, OrbiMed Royalty & Credit Opportunities IV, LP (collectively, “OrbiMed”), and Braidwell Transaction Holdings LLC (“Braidwell", and collectively with OrbiMed, the “New Term Loan Lenders”). Pursuant to the New Term Loan Agreement, the Company issued senior, secured promissory notes by which the New Term Loan Lenders agree to lend the Company up to an aggregate principal amount of $400.0 million (the “2023 Term Loan”), $200.0 million of which was received by the Company upon issuance (the “Initial Draw"), and the remaining $200.0 million was received by the Company in March 2024 (the "Delayed Draw"). Until the earlier of December 31, 2024 or the date on which the 2023 Term Loan amount was fully drawn, which occurred on March 5, 2024, the undrawn balance of the New Term Loan Commitment was subject to a fee of 0.5% per annum. The outstanding principal amount of the 2023 Term Loan is due and payable on January 18, 2028. If an event of default occurs and is continuing, the New Term Loan Lenders may declare all amounts outstanding under the New Term Loan Agreement to be immediately due and payable. A final payment exit fee equal to 1.0% of the amount funded under the New Term Loan Agreement is due upon prepayment or maturity. Amounts borrowed pursuant to the New Term Loan Agreement may be prepaid at any time. Upon prepayment, the Company is subject to a prepayment penalty based on the timing of repayment. The 2023 Term Loan bears interest at a rate per annum equal to a fixed margin of 6.5% plus the greater of (a) forward-looking three-month secured overnight financing rate ("SOFR") and (b) 2.5%. In the event of default, the fixed margin shall increase by 3.0% per annum. As of June 30, 2025, the interest rate was 10.8%. Regular quarterly payments are interest-only for the 60-month term of the New Term Loan Agreement, with the principal due at maturity. The effective interest rate for the Initial Draw of the 2023 Term Loan is 17.0%, and the effective interest rate for the Delayed Draw of the 2023 Term Loan is 12.0%. The Company’s obligations under the New Term Loan Agreement are secured by a first lien security interest in substantially all of the assets of the Company and its subsidiaries. The New Term Loan Agreement contains certain customary representations and warranties, affirmative and negative covenants, financial covenants, and events of default applicable to the Company and its subsidiaries. Additional covenants include those restricting dispositions, fundamental changes to its business, mergers or acquisitions, indebtedness, encumbrances, distributions, investments, transactions with affiliates and subordinated debt. At June 30, 2025, the Company is in compliance with all covenants. On April 1, 2025, the Company entered into an amendment of the 2023 Term Loan agreement. The amendment allowed for various consents from the lenders of the 2023 Term Loan as it relates to the 2025 Convertible Note, issued as part of the Pre-IPO financing. As part of the amendment, the Company paid an amendment fee of 1%, or $4.0 million. The Company evaluated the transaction and accounted for the amendment as a debt modification. The Company identified multiple embedded derivatives that require bifurcation from the 2023 Term Loan. They are separately accounted for in the condensed consolidated financial statements as one compound derivative liability. Those embedded features include various contingent prepayment and compensatory payment features as well as interest rate increases upon an event of default. Interest Expense The components of interest expense associated with the Company’s long-term indebtedness and the 2025 Convertible Note, excluding finance leases, are as follows:
| Three Months Ended June 30, |  | Six Months Ended June 30, |
| 2025 |  | 2024 |  | 2025 |  | 2024 |  |  |  |  |
| (amounts in thousands)
Debt discount amortization | $ | 7,755 |  |  | $ | 1,731 |  |  | $ | 9,700 |  |  | $ | 3,322 |  |  |  |  |  |
Interest expense | 11,446 |  |  | 11,933 |  |  | 22,275 |  |  | 19,623 |  |  |  |  |  |
Interest expense on long-term indebtedness, excluding finance leases | $ | 19,201 |  |  | $ | 13,664 |  |  | $ | 31,975 |  |  | $ | 22,945 |  |  |  |  |  |
Warrant Liability On September 21, 2018, the Company entered into a secured term loan agreement (the “Original Term Loan Agreement”) with Sixth Street Specialty Lending, Inc. and Barnett Debt Holdings, LLC. As part of the Original Term Loan Agreement, the Company issued a warrant to purchase 13,694,623 shares of Series C preferred stock (the “2018 Warrants"). In connection with the amendment to the Original Term Loan Agreement in 2020, the Company issued an additional warrant to purchase 11,399,814 shares of Series C preferred stock (the “2020 Warrants”) and amended the 2018 Warrants. Furthermore, these amendments also permitted the exercise of both the 2018 Warrants and 2020 Warrants into Series C preferred stock or common stock at the option of the holder. The 2018 Warrants are exercisable into Series C preferred stock at a price of $1.61 and into common stock at a price of $6.44. The 2020 Warrants are exercisable into Series C preferred stock at a price of $1.93 and into common stock at a price of $7.73. As a result of the amendment to permit exercise of the warrants into redeemable preferred stock, the warrants are classified as a liability pursuant to the guidance in ASC 480. Therefore, the warrants were reported at fair value within warrant liabilities on the condensed consolidated balance sheets, with changes in fair value reported within changes in fair value of financial instruments on the condensed consolidated statements of operations and comprehensive loss. As discussed in Note 2, the warrants were reclassified from liability to equity upon the IPO. The difference between the fair value of the warrants immediately prior to the reclassification and its prior fair value was recorded in the consolidated statement of operations and comprehensive loss as changes in fair value of financial instruments. The fair value immediately prior to the reclassification was $131.7 million, and is based on the total number of common stock issued upon exercise and conversion, multiplied by the public offering price of $21.00 per share. For the six months ended June 30, 2024, the Company recorded $5.3 million in changes in fair value of financial instruments, associated with the fair value changes of the 2018 and 2020 warrants. 2025 Convertible Notes On April 1, 2025, the Company issued 2025 Convertible Notes to certain investors in aggregate principal amount of $30.0 million. The 2025 Convertible Notes were scheduled to mature on January 1, 2026, accrued interest at a rate of 8% per annum, and, upon the closing of the IPO, converted at a conversion price equal to 70% of the initial public offering price per share, or into 2,076,596 shares of the Company’s common stock (inclusive of accrued interest), based on the initial public offering price of $21.00 per share. This legal-form conversion upon an initial public offering effectively functions as a share-settled redemption provision for accounting purposes and is accounted for as a bifurcated derivative liability in accordance with ASC 815. The 2025 Convertibles Notes were classified as a liability pursuant to the guidance in ASC 470 as they represented legal-form debt with a stated maturity and an obligation for the issuer to repay both principal and interest. Upon the closing of the initial public offering, the 2025 Convertible Notes converted into common stock at a price equal to 70% of the initial public offering price per share. A loss on extinguishment of approximately $17.9 million was recognized, representing the excess of the fair value of the common stock issued over the combined carrying amount of the 2025 Convertible Notes and the related bifurcated derivative liability. 2025 Warrant Liability On April 1, 2025, the Company also issued warrants to acquire shares of common stock to the holders of the 2025 Convertible Notes. These warrants were not initially exercisable for any shares of common stock, but such warrants became exercisable for a specified dollar value of shares on a monthly basis commencing on June 1, 2025 if the Company did not complete an initial public offering by such date. Additional warrants would have been issued each subsequent month that an initial public offering fails to occur based on a certain percentage. These warrants were classified as a liability pursuant to the guidance in ASC 480 as they represented a conditional obligation to issue a variable number of shares based on a fixed monetary amount known at inception. Therefore, these warrants were reported at fair value within warrant liabilities on the condensed consolidated balance sheets, with changes in fair value reported within changes in fair value of financial instruments on the condensed consolidated statements of operations and comprehensive loss. As discussed in Note 2, the 2025 warrants were net exercised into 784,231 shares of the Company’s common stock connection with the IPO. The difference between the fair value of the warrants immediately prior to the IPO and its initial fair value was recorded in the consolidated statement of operations and comprehensive loss as changes in fair value of financial instruments. The fair value immediately prior to the IPO was $16.5 million, and was based on the total number of common stock issued upon exercise and conversion, multiplied by the public offering price of $21.00 per share. The initial allocated proceeds of the warrant was $10.3 million, which represents the fair value of the warrants on April 1, 2025.

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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 815 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 8A -Publisher FASB -URI https://asc.fasb.org/1943274/2147480434/815-10-50-8A Reference 2: http://www.xbrl.org/2003/role/disclosureRef 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