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FINANCING ARRANGEMENTS
 9 Months Ended
Sep. 30, 2025
Debt Disclosure [Abstract]  
FINANCING ARRANGEMENTS FINANCING ARRANGEMENTS
As of September 30, 2025, the Company has the following material financing arrangements outstanding: the 2030 Notes, the 2027 Notes, the 2026 Notes, capped call transactions and letters of credit pursuant to the Cash Collateral Agreement.
On July 2, 2025, the Company issued $244.1 million aggregate principal amount of its 2030 Notes, consisting of (i) $20.0 million aggregate principal amount of 2030 Notes issued in exchange for $20.0 million aggregate principal amount of the Company’s outstanding 2026 Notes, and (ii) $224.1 million aggregate principal amount of 2030 Notes issued in exchange for $150.0 million aggregate principal amount of the Company’s outstanding 2027 Notes, with 2030 Notes Offering Participants.

We assessed whether the exchange of $20.0 million of the 2026 Notes and $150.0 million of the 2027 Notes resulted in a modification or an extinguishment of the existing debt for each loan in the syndication on a lender-by-lender basis. The exchanged amount of the 2026 Notes and 2027 Notes is a non-cash financing activity. The Company determined that the exchanged portion of the 2026 Notes and the 2027 Notes were extinguished and new debt pertaining to the 2030 Notes was obtained, resulting in a loss on extinguishment of debt of $99.9 million. The loss on extinguishment of debt, which is included in Other income (expense), net on the Condensed Consolidated Statements of Operations, consists of the difference between the fair value of the 2030 Notes at issuance and the net carrying amount of the 2026 Notes and 2027 Notes exchanged. The net carrying amount of the portion of the 2026 Notes and 2027 Notes that was extinguished was determined on a pro rata basis.
On July 2, 2025, the Company entered into the Supplemental Indenture, by and among itself, the guarantors signatory thereto, and U.S. Bank Trust Company, National Association, as trustee and as collateral agent. The Supplemental Indenture deletes in their entirety substantially all of the negative covenants and related provisions from the 2027 Notes Indenture, and releases all of the liens on the collateral securing the obligations under the 2027 Notes.
Convertible Senior Notes due 2030

On July 2, 2025, the Company issued $244.1 million aggregate principal amount of its 2030 Notes. The 2030 Notes are senior, unsecured obligations of the Company and bear interest at a rate of 4.875% per annum, payable semi-annually in arrears on each June 30 and December 30 of each year, commencing December 30, 2025. The 2030 Notes will mature on June 30, 2030, unless earlier converted, redeemed or repurchased.
The initial conversion rate of the 2030 Notes is 18.503 shares of Company Common Stock per $1,000 principal amount of 2030 Notes, which is equivalent to an initial conversion price of approximately $54.04 per share, subject to customary adjustments. In addition, upon the occurrence of a make-whole fundamental change, as defined in the 2030 Notes Indenture, or if we exercise the optional redemption, we will, in certain circumstances, increase the conversion rate by a number of additional shares for a holder that elects to convert its 2030 Notes in connection with such a make-whole fundamental change or redemption.
In no event will the conversion rate be increased to exceed 27.7546 shares of the Company’s Common Stock per $1,000 principal amount of the 2030 Notes, subject to adjustments.
The Company has the conditional right to redeem the notes for cash on or after July 2, 2028. The redemption price will be 100.0% of the principal amount, plus accrued and unpaid interest. No sinking fund is provided for the 2030 Notes. The Company has the right to repurchase notes in the open market or through other means, without the consent of holders and without prior notice.
The 2030 Notes are convertible into Common Stock or a combination of cash and Common Stock, at the Company’s election. Subject to certain conditions, holders of the 2030 Notes may convert all or any portion of their 2030 Notes at their option at any time on or after March 31, 2030, until the close of business on the second scheduled trading day immediately preceding the maturity date. In addition, if specified events occur in a calendar quarter prior to December 15, 2026, the holders may elect to convert on an effective date of such event. Based on the closing price of the Common Stock of $23.35 as of September 30, 2025, the if-converted value of the 2030 Notes was less than the principal amount.
Pursuant to the 2030 Notes Indenture, the Company is entitled to not effect any conversion that will result in any holder thereof, together with any Attribution Parties, beneficially owning more than 4.9% of the Company's Common Stock (the “Exchange Cap”), after giving effect to such conversion. The Company’s obligation to deliver
any shares of Common Stock that will result in any holder thereof to exceed the Exchange Cap (the “Excess Shares”) is not extinguished and is suspended until such holder advises the Company in writing that it may receive the Excess Shares without exceeding the Exchange Cap.

Certain conditions apply to the conversion by holders and redemption by us of the 2030 Notes. In addition, upon the occurrence of a fundamental change, as defined in the 2030 Notes Indenture, prior to the maturity date, holders may require us to repurchase all or a portion of the 2030 Notes for cash.
The 2030 Notes Indenture contains customary provisions relating to events of default. If an event of default occurs and is continuing, the principal amount of the 2030 Notes and any accrued and unpaid interest may be declared immediately due and payable. In the case of bankruptcy or insolvency, the principal amount of the 2030 Notes and any accrued and unpaid interest would automatically become immediately due and payable. The 2030 Notes will be considered in default if there is a default by the Company or any of its significant subsidiaries with respect to indebtedness for borrowed money of at least $75.0 million.

We account for the 2030 Notes as a liability in its entirety measured at amortized cost. The carrying value of the 2030 Notes was determined by deducting third party transaction costs incurred in connection with the issuance of the 2030 Notes of $2.3 million from the 2030 Notes fair value of $267.7 million at issuance. The transaction costs were recorded as a debt issuance cost in the Condensed Consolidated Balance Sheets and are amortized as interest expense and presented in Other income (expense) on the Condensed Consolidated Statements of Operations. The 2030 Notes were issued at a premium of $23.6 million. The premium, which represents the excess fair value over the principal amount, is amortized over the term of the 2030 Notes as a reduction of interest expense and presented in Other income (expense) on the Condensed Consolidated Statements of Operations. Together with the cash interest, the amortization of debt issuance costs and debt premium result in an effective interest rate of 2.99% over the term of the 2030 Notes. We have presented the 2030 Notes in Non-current liabilities in the accompanying Condensed Consolidated Balance Sheets.

The carrying amount of the 2030 Notes consisted of the following as of September 30, 2025 (in thousands):

September 30, 2025
Principal amount
$244,071 
Plus: Unamortized debt premium
22,522 
Less: Unamortized debt issuance costs
(2,182)
Total $264,411 
We classified the fair value of the 2030 Notes as a Level 3 measurement due to the lack of observable market data over fair value inputs such as our stock price volatility over the term of the 2030 Notes and our cost of debt. The estimated fair value of the 2030 Notes as of September 30, 2025 was $233.0 million and was determined using a lattice model.
During the three and nine months ended September 30, 2025, we recognized interest costs on the 2030 Notes as follows (in thousands):

Three and Nine Months Ended September 30,
2025
Contractual interest
$2,975 
Amortization of debt premium and debt issuance costs, net
(993)
Total $1,982 


Convertible Senior Secured Notes due 2027

In November 2024, the Company issued $197.3 million aggregate principal amount of the 2027 Notes to the 2027 Notes Offering Participants in a private offering. The 2027 Notes bear interest at a rate of 6.25% per annum, payable semi-annually in arrears on March 15 and September 15 of each year. After the exchange on July 2, 2025, the annual effective interest rate is 7.27%. The 2027 Notes will mature on March 15, 2027, subject to earlier repurchase or conversion.
The initial conversion rate of the 2027 Notes is 33.333 shares of Common Stock, which is the equivalent to an initial conversion price of approximately $30 per share, subject to customary adjustments. The 2027 Notes are convertible into Common Stock or a combination of cash and Common Stock, at the Company's election. As a result of entering into the Supplemental Indenture, the Company has been released of its obligation to pay additional interest of 2.5% per annum of the 2027 Notes in the event that it failed to sell or pledge certain of its assets as part of the collateral for the 2027 Notes. Upon the occurrence of a make-whole fundamental change, we will, in certain circumstances, increase the conversion rate by a number of additional shares for a holder that elects to convert its 2027 Notes in connection with such make-whole fundamental change. The 2027 Notes will be considered in default if there is a default by the Company or any of its significant subsidiaries with respect to indebtedness for borrowed money of at least $35.0 million.
Following the issuance of the 2030 Notes and partial exchange of the 2027 Notes in July 2025, the remaining outstanding principal of the 2027 Notes was $47.3 million.

The carrying amount of the 2027 Notes consisted of the following as of September 30, 2025 and December 31, 2024 (in thousands):

September 30, 2025
December 31, 2024
Fair value of principal recorded at issuance (1)
$46,210 $196,210 
Less: debt discount
(557)(3,483)
Total $45,653 $192,727 
(1)    The original principal of the 2027 Notes at issuance was recorded at fair value of $196.2 million, which is equal to the exchanged principal of $176.3 million and cash consideration received of $19.9 million. After the exchange on July 2, 2025, the remaining fair value of the principal recorded at issuance of the 2027 Notes was $46.2 million.
We classified the fair value of the 2027 Notes as a Level 3 measurement due to the lack of observable market data over fair value inputs such as our stock price volatility over the term of the 2027 Notes and our cost of debt. The estimated fair value of the 2027 Notes as of September 30, 2025 and December 31, 2024 was $53.2 million and $192.0 million and was determined using a lattice model.

For the three and nine months ended September 30, 2025, we recognized interest costs on the 2027 Notes as follows (in thousands):

Three Months Ended September 30, 2025Nine Months Ended September 30, 2025
Contractual interest
$791 $6,955 
Amortization of debt discount
98 849 
Total $889 $7,804 



Convertible Senior Notes due 2026
In March and April 2021, we issued $230.0 million aggregate principal amount of 2026 Notes in a private offering to qualified institutional buyers. The 2026 Notes bear interest at a rate of 1.125% per annum, payable semi-annually in arrears on March 15 and September 15 of each year. After the exchange on July 2, 2025, the annual effective interest rate of the 2026 Notes remained 1.83%. The 2026 Notes will mature on March 15, 2026, subject to earlier repurchase, redemption or conversion. In connection with the issuance of the 2027 Notes in November 2024, the Company exchanged $176.3 million aggregate principal amount of 2026 Notes held by the 2026 Notes Offering Participants for $176.3 million aggregate principal amount of the 2027 Notes. Following the issuance of the 2027 Notes and partial exchange of the 2026 Notes in November 2024, the remaining outstanding principal of the 2026 Notes was $53.7 million.
Following the issuance of the 2030 Notes and partial exchange of the 2026 Notes in July 2025, the remaining outstanding principal of the 2026 Notes was $33.7 million.

Each $1,000 of principal amount of the 2026 Notes initially is convertible into 14.6800 shares of Common Stock, which is equivalent to an initial conversion price of $68.12 per share, subject to adjustment upon the occurrence of specified events. The 2026 Notes are convertible into cash, shares of our Common Stock, or any combination of cash and shares of our Common Stock. Upon the occurrence of a make-whole fundamental change, or if we issue a notice of redemption, we will, in certain circumstances, increase the conversion rate by a number of additional shares for a holder that elects to convert its 2026 Notes in connection with such make-whole fundamental change or redemption. The 2026 Notes will be considered in default if there is a default by the Company or any of its significant subsidiaries with respect to indebtedness for borrowed money of at least $50.0 million.
The carrying amount of the 2026 Notes consisted of the following as of September 30, 2025 and December 31, 2024 (in thousands):
September 30, 2025December 31, 2024
Principal amount$33,740 $53,740 
Less: debt discount(108)(454)
Net carrying amount of liability component
$33,632 $53,286 
We classified the fair value of the 2026 Notes as a Level 3 measurement due to the lack of observable market data over fair value inputs such as our stock price volatility over the term of the 2026 Notes and our cost of debt. The estimated fair value of the 2026 Notes as of September 30, 2025 and December 31, 2024 was $32.9 million and $48.7 million and was determined using a lattice model.
During the three and nine months ended September 30, 2025 and 2024, we recognized interest costs on the 2026 Notes as follows (in thousands):
Three Months Ended September 30, Nine Months Ended September 30,
2025202420252024
Contractual interest$96 $539 $398 $1,916 
Amortization of debt discount59 395 246 1,180 
Total $155 $934 $644 $3,096 
Capped Call Transactions
In connection with the issuance of the 2026 Notes, we entered into privately-negotiated capped call transactions. The capped call transactions cover, subject to customary adjustments, the number of shares of Common Stock initially underlying the 2026 Notes. The capped call transactions are expected generally to reduce potential dilution to our Common Stock upon any conversion of the 2026 Notes and/or offset any cash payments we are required to make in excess of the principal amount of converted notes, with such reduction and/or offset subject to a cap initially equal to $104.80, which represents a premium of 100% over the last reported sale price of our Common Stock on The Nasdaq Global Select Market on March 22, 2021, subject to certain adjustments under the terms of the capped call transactions.
No changes to the capped call transactions occurred in connection with the Exchange and Subscription agreements pertaining to the issuance of the 2027 Notes in November 2024.
In June 2025, in connection with the issuance of the 2030 Notes and partial exchange of the 2026 Notes, the Company entered into agreements with the bank counterparties to collectively unwind and terminate 196,200 capped call transactions, which is equal to the proportion of the total principal of the 2026 Notes that was exchanged for the 2027 Notes and 2030 Notes. Upon entering into the unwind and termination agreements, the Company determined the related portion of the capped call transactions no longer met the criteria for equity classification. In July 2025, the Company subsequently received cash proceeds of $2.7 million for the settlement of the capped call transactions. The remaining capped call transactions continue to be classified as equity and are presented in Additional paid-in capital on the Condensed Consolidated Statements of Stockholders' Equity (Deficit) as of September 30, 2025.
The remaining capped call transactions continue to be accounted for as freestanding financial instruments and recorded at the initial fair value in Additional paid-in capital in the Condensed Consolidated Balance Sheets with no recorded subsequent change to fair value as long as they meet the criteria for equity classification.
Revolving Credit Agreement
In February 2024, we prepaid $43.1 million to terminate all commitments to access further credit under the Credit Agreement using a portion of the $80.0 million in proceeds received from the Rights Offering. See Note 8, Stockholders' Equity (Deficit) and Compensation Arrangements, for additional information regarding the Rights Offering. The Payoff Amount included $42.8 million in principal, $0.1 million in interest and $0.2 million in fees. The terms of the Rights Offering permit the Company to use the proceeds for general corporate purposes, including the repayment of debt. We were not subject to any early termination penalties under the Credit Agreement. The payment of the Payoff Amount terminated our obligations under the Credit Agreement, except for ordinary and customary survival terms. In addition, we retained access to letters of credit, originally available under the Credit Agreement, pursuant to our pre-existing Cash Collateral Agreement.
The amounts committed to letters of credit under the Cash Collateral Agreement and Credit Agreement as of September 30, 2025 and December 31, 2024 were $32.6 million and $33.7 million. Pursuant to the Cash Collateral Agreement, cash collateral is required for all letters of credit and treated as restricted cash, which is presented in Prepaid expense and other current assets on the Condensed Consolidated Balance Sheets. See Note 5, Supplemental Condensed Consolidated Balance Sheets and Statements of Operations Information, for additional information.