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Fair Value Measurements
 3 Months Ended 12 Months Ended
Mar. 31, 2025
Dec. 31, 2024
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items]    
Fair Value Measurements
Note 5. Fair Value Measurements
The table below presents the Company’s financial assets and liabilities measured at fair value on a recurring basis aggregated by the level in the fair value hierarchy
:
 
    
As of March 31, 2025
  
(Amounts in thousands)
   
Level 1
     
Level 2
     
Level 3
     
Total
  
Assets:
            
U.S. Government treasury securities
    $ 30,883      $ —       $ —       $ 30,883  
U.S. Government money market funds
      5,336        —         —         5,336  
Mutual funds
      5,120        —         —         5,120  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total assets, measured at fair value
    $ 41,339      $ —       $ —       $ 41,339  
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Earnout share liabilities
    $ —       $ —       $ 9,507      $ 9,507  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total liabilities, measured at fair value
    $ —       $ —       $ 9,507      $ 9,507  
  
 
 
     
 
 
     
 
 
     
 
 
  
 
    
As of December 31, 2024
  
(Amounts in thousands)
   
Level 1
     
Level 2
     
Level 3
     
Total
  
Assets:
            
U.S. Government treasury securities
    $ 30,580      $ —       $ —       $ 30,580  
U.S. Government money market funds
      9,247        —         —         9,247  
Mutual funds
      5,067        —         —         5,067  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total assets, measured at fair value
    $ 44,894      $ —       $ —       $ 44,894  
  
 
 
     
 
 
     
 
 
     
 
 
  
 
 
    
As of December 31, 2024
  
(Amounts in thousands)
   
Level 1
     
Level 2
     
Level 3
     
Total
  
Liabilities:
            
Pay-to-Play
convertible notes
    $ —       $ —       $ 15,942      $ 15,942  
2023 convertible notes
      —         —         132,687        132,687  
Warrant liabilities
      —         —         14,711        14,711  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total liabilities, measured at fair value
    $ —       $ —       $ 163,340      $ 163,340  
  
 
 
     
 
 
     
 
 
     
 
 
  
Level 1 instruments consisted of U.S. Government treasury securities, U.S. Government money market funds, and mutual funds because they were valued using quoted prices in active markets and can be redeemed on any business days with an intermediary.
Level 3 instruments consisted of earnout share liabilities. The Company has elected to apply the fair value option to measure all historical convertible notes and warrant liabilities (see Notes 8 and 9) and current earnout shares due to the nature of their embedded features.
Changes in the fair value measurement of Level 3 liabilities related to unrealized gains (losses) resulting from remeasurement of our outstanding historical convertible notes and warrant liabilities (see Notes 8 and 9) and current earnout shares. The respective changes for remeasurement are reflected in the change in fair value of convertible notes, change in fair value of warrant liabilities and change in fair value of the earnout liabilities in the condensed consolidated statements of operations.
The changes in the fair values of the Level 3 liabilities were as follows:
 
(Amounts in thousands)
   
Pay-to-Play

Convertible Notes
    
2023 Convertible
Notes
    
Warrant

liabilities
    
Earnout share
liabilities
    
Total
  
Balance as of December 31, 2024
    $ 15,942     $ 132,687     $ 14,711     $ —      $ 163,340  
Issuance of earnout share awards
      —        —        —        126,025       126,025  
Change in estimated fair value
      27,232       138,471       60,345       (116,518 )      109,530  
Conversion to common stock
      (43,174 )      (271,158 )      (75,056 )      —        (389,388 ) 
  
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
Balance as of March 31, 2025
    $ —      $ —      $ —      $ 9,507     $ 9,507  
  
 
 
    
 
 
    
 
 
    
 
 
    
 
 
  
 
(Amounts in thousands)
   
Pay-to-Play

Convertible Notes
    
2023 Convertible
Notes
     
Warrant

liabilities
     
Earnout share
liabilities
     
Total
  
Balance as of December 31, 2023
    $ 14,641     $ 18,064      $    3,730      $ —       $ 36,435  
Issuance of 2023 convertible notes and related warrants
      —        10,591        909        —         11,500  
Change in estimated fair value
      (92 )      4,743        3,515        —         8,166  
  
 
 
    
 
 
     
 
 
     
 
 
     
 
 
  
Balance as of March 31, 2024
    $ 14,549     $    33,398      $ 8,154      $ —       $   56,101  
  
 
 
    
 
 
     
 
 
     
 
 
     
 
 
  
The Company’s convertible notes and related warrants outstanding as of December 31, 2024 were classified within level 3 of the fair value hierarchy because there was no active market for the liabilities or similar instruments.
 
 
There were no transfers between Level 1, Level 2, or Level 3 of the fair value hierarchy during the three months ended March 31, 2025 or 2024.
Upon the consummation of the Merger, all then outstanding convertible notes and warrant liabilities were converted into shares of common stock (see Note 3).
Note 4. Fair Value Measurements
The table below presents the Company’s financial assets and liabilities measured at fair value on a recurring basis aggregated by the level in the fair hierarchy (in thousands):
 
 
  
 
 
  
December 31, 2024
 
  
 
 
 
  
Level 1
 
  
Level 2
 
  
Level 3
 
  
Total
 
Assets:
            
U.S. Government treasury securities
    $ 30,580      $ —       $ —       $ 30,580  
U.S. Government money market funds
      9,247        —         —         9,247  
Mutual funds
      5,067        —         —         5,067  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total assets, measured at fair value
    $ 44,894      $ —       $ —       $ 44,894  
  
 
 
     
 
 
     
 
 
     
 
 
  
Liabilities:
            
Pay-to-Play
convertible notes
    $ —       $ —       $ 15,942      $ 15,942  
2023 Convertible notes
      —         —         132,687        132,687  
Warrant liabilities
      —         —         14,711        14,711  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total liabilities, measured at fair value
    $ —       $ —       $ 163,340      $ 163,340  
  
 
 
     
 
 
     
 
 
     
 
 
  
            December 31, 2023         
     Level 1      Level 2      Level 3      Total  
Liabilities:
            
Pay-to-Play
convertible notes
    $ —       $ —       $ 14,641      $ 14,641  
2023 Convertible notes
      —         —         18,064        18,064  
Warrant liabilities
      —         —         3,730        3,730  
  
 
 
     
 
 
     
 
 
     
 
 
  
Total liabilities, measured at fair value
    $ —       $ —       $ 36,435      $ 36,435  
  
 
 
     
 
 
     
 
 
     
 
 
  
Level 1 instruments consisted of U.S. Government treasury securities, U.S. Government money market funds, and mutual funds because they were valued using quoted prices in active markets and can be redeemed on any business days with an intermediary.
Level 3 instruments consisted of the Company’s
Pay-to-Play
Convertible Notes (“P2P Notes”), the 2023 Convertible Notes, and warrant liabilities comprised of the Company’s Series D Shadow preferred stock warrants, Series
D-2
Shadow preferred stock warrants, the warrants issued with the P2P Notes and the 2023 Convertible Notes, and the
pre-funded
common stock warrants (see Notes 7 and 8). The Company has elected to apply the fair value option to measure all convertible notes due to the nature of their embedded features.
Changes in the fair value measurement of Level 3 liabilities related to unrealized gains (losses) resulting from remeasurement of the Company’s outstanding convertible notes and warrant liabilities (see Notes 7 and 8) are reflected in the change in fair value of convertible notes and change in fair value of warrant liabilities in the consolidated statements of operations.
 
The change in the fair value of the Level 3 liabilities during the years ended December 31, 2024 and 2023 was as follows (in thousands):
 
 
  
Pay-to-Play

Convertible
notes
 
  
2023
Convertible
notes
 
  
Warrant
liabilities
 
  
Total
 
Balance at January 1, 2023
    $ 3,139      $ —       $ 529      $ 3,668  
Reinstatement of common stock warrants as preferred stock warrants
      —         —         61        61  
Issuance of
Pay-to-Play
convertible notes and related warrants
      8,717        —         565        9,282  
Common rights offering
      142        —         —         142  
Issuance of 2023 convertible notes and related warrants
      —         11,175        1,125        12,300  
Issuance of
Pre-funded
common stock warrants
      —         —         505        505  
Change in estimated fair value
      2,643        6,889        945        10,477  
  
 
 
     
 
 
     
 
 
     
 
 
  
Balance at December 31, 2023
    $ 14,641      $ 18,064      $ 3,730      $ 36,435  
Issuance of 2023 convertible note warrants and related warrants
      —         105,902        4,816        110,718  
Issuance of
Pre-funded
common stock warrants
      —         —         464        464  
Change in estimated fair value
      1,301        8,721        5,701        15,723  
  
 
 
     
 
 
     
 
 
     
 
 
  
Balance at December 31, 2024
    $ 15,942      $ 132,687      $ 14,711      $ 163,340  
  
 
 
     
 
 
     
 
 
     
 
 
  
The Company’s convertible notes and related warrants were classified within level 3 of the fair value hierarchy because there was no active market for the liabilities or similar instruments.
There were no transfers between Level 1, Level 2, or Level 3 of the fair value hierarchy during the years ended December 31, 2024 and 2023. Certain existing investors invested in P2P Notes during the year ended December 31, 2023, and accordingly, their common stock warrants were converted into Series D Shadow preferred stock warrants and reclassified as warrant liabilities (see Notes 7, 8 and 13).
Effective with the Merger on January 13, 2025, all outstanding convertible notes and outstanding warrant liabilities were converted (see Note 1).