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Related-Party Debt
 6 Months Ended
Jun. 30, 2026
Related Party Transactions [Abstract]  
Related-Party Debt Related-Party Debt
Our related-party debt is summarized below (in thousands):
Balance as of June 30, 2026
Fair Value
Maturity
Year		Interest
Rate		Principal
Amount		AmountLeveling
December 2024 Convertible Promissory Note2027
Term
SOFR
+8.0%
$480,000 $774,350 Level 3
Balance as of December 31, 2025
Fair Value
Maturity
Year		Interest
Rate		Principal
Amount		AmountLeveling
December 2024 Convertible Promissory Note2027
Term
SOFR
+8.0%
$505,000 $477,093 Level 3
December 2024 Convertible Promissory Note
On December 10, 2024, in connection with an equity offering, the company and Nant Capital entered into a second amended and restated promissory note. Pursuant to the terms of the second amended and restated promissory note, Tranche 1 of the December 2023 Promissory Note with a principal amount of $125.0 million and Tranche 2 of the December 2023 Promissory Note with a principal amount of $380.0 million were combined into one convertible promissory note with a principal amount of $505.0 million with a maturity date of December 31, 2027. The December 2024 Convertible Promissory Note bears an interest rate of Term SOFR plus 8.0% per annum, payable on a quarterly basis. Pursuant to the terms of the second amended and restated promissory note, the noteholder, in its sole discretion, may convert all of the outstanding principal amount into shares of common stock at a conversion price of $5.4270 per share. The company may prepay the outstanding promissory note, at any time, in whole or in part, without penalty. Upon receipt of a written notice of prepayment from the company, the noteholder has the option to convert the outstanding principal amount to be prepaid and the accrued and unpaid interest thereon into shares of the company’s common stock at the same conversion price of $5.4270 per share. In addition, the noteholder can request up to $50.0 million of the outstanding principal amount and accrued interest to be repaid upon consummation of a specified transaction.
On January 23, 2026, the company entered into an amendment to the December 2024 Convertible Promissory Note to provide the holder with the optional right to convert any portion of the outstanding principal amount into shares of the company’s common stock at any time prior to the maturity date. In accordance with ASC 470-50, the company concluded that the amendment did not represent a substantial modification of the December 2024 Convertible Promissory Note, and the note was not accounted for as an extinguishment and continues to be measured at fair value.
On March 31, 2026, Nant Capital converted $25.0 million of the principal of the December 2024 Convertible Promissory Note into 4,606,596 shares of common stock at a conversion price of $5.4270 per share. Upon conversion, the company derecognized the converted principal at its fair value of $35.3 million and recognized the par value of shares issued in common stock and the remaining excess in additional paid-in capital, on both the condensed consolidated balance sheet and the condensed consolidated statement of stockholders’ deficit. The company did not recognize any gain or loss upon conversion since the December 2024 Convertible Promissory Note is accounted for under the fair value option in accordance with ASC 825.
In connection with the conversion, during the three months ended March 31, 2026, the company reclassified $1.4 million of change in fair value related to instrument-specific credit risk that was previously recorded in accumulated other comprehensive income, on the condensed consolidated statement of stockholders’ deficit, to other expense, net, on the condensed consolidated statement of operations. This reclassification represents the portion of the cumulative change in fair value attributable to instrument-specific credit risk related to the converted principal amount.
As of June 30, 2026, the remaining principal balance of the December 2024 Convertible Promissory Note was $480.0 million.
The company elected the fair value option for recognizing the December 2024 Convertible Promissory Note under ASC 825. Under the FVO election, the note was initially measured at estimated fair value upon issuance and is remeasured at estimated fair value on a recurring basis at each reporting period date. The estimated fair value of the convertible note was computed using the following unobservable inputs at the following dates:
June 30,
2026		December 31,
2025
Binomial lattice model:
Expected market yield17.4 %14.8 %
Expected volatility77.5 %87.5 %
The change in the fair value of this note was as follows (in thousands):
Fair value, at December 31, 2025$477,093 
Change in fair value of related-party convertible note236,625 
Conversion to common stock(35,332)
Fair value, at March 31, 2026678,386 
Change in fair value of related-party convertible note95,964 
Fair value, at June 30, 2026$774,350 
Mandatory Prepayment Feature
The embedded derivative related to a contingently exercisable prepayment feature, which allows the noteholder to request up to a $50.0 million prepayment and accrued interest upon occurrence of a specified transaction (defined in the promissory note) was recorded as a derivative liability on the condensed consolidated balance sheet and measured at fair value prior to the second amended and restated promissory note.
Since the company elected the fair value option to account for the December 2024 Convertible Promissory Note, the embedded derivative is no longer required to be recorded separately but is considered when estimating the fair value of the December 2024 Convertible Promissory Note.
The following table summarizes the estimated future contractual obligations of our related-party debt as of June 30, 2026 (in thousands):
Principal
Payments		Interest
Payments (1)		Total
2026 (excluding the six months ended June 30, 2026)
$— $28,372 $28,372 
2027
480,000 56,282 536,282 
Total$480,000 $84,654 $564,654 
_______________
(1)
Interest payments on our convertible promissory note are calculated based on Term SOFR plus the contractual spread per the loan agreement. The interest rate on our convertible promissory note as of June 30, 2026 was 11.73%.
Interest expense consists of the following (in thousands):
Three Months Ended
June 30,		Six Months Ended
June 30,
2026202520262025
Interest expense on related-party convertible note$14,032 $15,474 $28,591 $30,787 
In connection with the RIPA transaction, the outstanding related-party convertible note was subordinated to the RIPA payment obligations.
Related-Party Agreements
Our Founder, Executive Chairman and Global Chief Scientific and Medical Officer also founded and has a controlling interest in NantWorks, which is a collection of companies in the healthcare and technology space. As described below, we have entered into arrangements with NantWorks, and certain affiliates of NantWorks, to facilitate the development of new immunotherapies for our product pipeline. Affiliates of NantWorks are also affiliates of the company due to the common control by and/or common ownership interest of our Founder, Executive Chairman, Global Chief Scientific and Medical Officer, and principal stockholder.
NantWorks, LLC
Shared Services Agreement
Under the amended and restated shared services agreement with NantWorks dated as of June 2016, but effective as of August 2015, NantWorks, a related party, provides corporate, general and administrative, certain research and development, and other support services to us, and we provide certain of such services to them. The receiving party is charged for the services at cost plus reasonable allocations of employee benefits, facilities, and other direct or fairly allocated indirect costs that relate to the employees providing the services. During the three months ended June 30, 2026 and 2025, we recorded $1.0 million and $0.3 million, respectively, in selling, general and administrative – related parties, and $0.1 million of expense reimbursements under this arrangement in research and development – related parties, on the condensed consolidated statements of operations. During the six months ended June 30, 2026 and 2025, we recorded $2.1 million and $0.8 million, respectively, in selling, general and administrative – related parties expense, and $0.3 million and $0.5 million of expense reimbursements, respectively, under this arrangement in research and development – related parties expense, on the condensed consolidated statements of operations. These amounts exclude certain immaterial general and administrative expenses provided by third-party vendors directly for our benefit, which were reimbursed to NantWorks based on those vendors’ invoiced amounts without markup by NantWorks.
As of June 30, 2026 and December 31, 2025, we had a payable of $0.9 million and $0.2 million, respectively, for all agreements with NantWorks, which are included in due to/due from related parties, on the condensed consolidated balance sheets. We also recorded $0.9 million and $0.7 million of prepaid expenses for various services that we expect will be passed through to the company from NantWorks as of June 30, 2026 and December 31, 2025, respectively, which are included in prepaid expenses – related parties, on the condensed consolidated balance sheets.
Facility License Agreement
In 2015, we entered into a facility license agreement with NantWorks for office space in Culver City, California, which was converted to a research and development laboratory and a cGMP manufacturing facility. We recorded license fee expense for this facility totaling $0.9 million during the three months ended June 30, 2026 and 2025, and $1.8 million during the six months ended June 30, 2026 and 2025, respectively, in research and development – related parties expense, on the condensed consolidated statements of operations.
Related-Party Leases
The company leases certain assets under operating leases with certain entities controlled by NantWorks and its affiliates or subsidiaries. Right-of-use assets for related-party operating leases totaled $11.7 million and $13.2 million, and the associated operating lease liabilities totaled $15.0 million and $17.0 million, as of June 30, 2026 and December 31, 2025, respectively. The company recorded operating lease expense totaling $1.1 million during the three months ended June 30, 2026 and 2025, and $2.3 million during the six months ended June 30, 2026 and 2025, respectively. Related-party leases were classified as either selling, general and administrative – related parties or research and development – related parties, on the condensed consolidated statements of operations, depending on the use of the facility.
Immuno-Oncology Clinic, Inc.
We have entered into multiple agreements with the Clinic to conduct clinical trials related to certain of our product candidates. The Clinic is a related party as it is owned by an officer of the company and NantWorks manages the administrative operations of the Clinic.
Related to clinical trial and transition services provided by the Clinic, we recorded $1.0 million and $0.7 million during the three months ended June 30, 2026 and 2025, respectively, and $2.2 million and $1.2 million, respectively, during the six months ended June 30, 2026 and 2025 in research and development – related parties expense, on the condensed consolidated statements of operations.
As of June 30, 2026 and December 31, 2025, we owed the Clinic $0.4 million and $0.1 million, respectively, which is included in due to related parties, on the condensed consolidated balance sheets.