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Debt
 3 Months Ended
Mar. 31, 2025
Debt Disclosure [Abstract]  
Debt

Note E – Debt

Debt obligations consisted of the following as of March 31, 2025 and December 31, 2024 (in thousands):

 

Debt instrument

 

Principal at
March 31, 2025

 

 

Unamortized
Debt Discount

 

 

Balance at
March 31, 2025

 

Current Portion:

 

 

 

 

 

 

 

 

 

Debentures

 

$

146

 

 

$

—

 

 

$

146

 

Other

 

 

585

 

 

 

—

 

 

 

585

 

Long-term Portion:

 

 

 

 

 

 

 

 

 

2015 Subordinated Notes

 

 

10,500

 

 

 

(368

)

 

 

10,132

 

Promissory Note

 

 

24,750

 

 

 

(2,036

)

 

 

22,714

 

Total

 

$

35,981

 

 

$

(2,404

)

 

$

33,577

 

 

Debt instrument

 

Balance at
December 31, 2024

 

 

Unamortized
Debt Discount

 

 

Net balance at
December 31, 2024

 

Current Portion:

 

 

 

 

 

 

 

 

 

2015 Subordinated Notes

 

$

2,471

 

 

$

—

 

 

$

2,471

 

Debentures

 

 

146

 

 

 

—

 

 

 

146

 

Other

 

 

81

 

 

 

—

 

 

 

81

 

Long-term Portion:

 

 

 

 

 

 

 

 

 

2015 Subordinated Notes

 

 

10,500

 

 

 

—

 

 

 

10,500

 

Promissory Note

 

 

22,000

 

 

 

(2,027

)

 

 

19,973

 

Total

 

$

35,198

 

 

$

(2,027

)

 

$

33,171

 

 

As of March 31, 2025 and December 31, 2024, the principal amount of our outstanding debt balance was $36.0 million and $35.2 million, respectively.

 

 

Promissory Note

In November 2024, we, through a subsidiary, entered into a promissory note (the “Note”) with Ocean 1181 LLC (the “Lender”) for a loan in an aggregate principal amount of $22.0 million (the “Loan”). The Loan has a two-year term and is principally secured by our manufacturing facility in Berkeley, CA and parcels of land located in Vacaville, CA.

In March 2025, we and the Lender agreed to increase the principal amount under the Note by $2.75 million. As part of the transaction, we reimbursed the Lender for transaction costs and paid a 1% origination fee, totaling approximately $0.3 million. These amounts are presented net of the liability in our condensed consolidated balance sheets and will be amortized to interest expense over the term of the Loan.

Subordinated Notes

In February 2015, we issued subordinated promissory notes in the aggregate principal amount of $14.0 million, of which $10.5 million remains outstanding (the “2015 Subordinated Notes”).

In February 2025, we entered into an Amendment to Notes, Amendment of Warrants and Sale of New Warrants (the “Amendment”) with existing noteholders, pursuant to which we:

•
extended the maturity date of $10.5 million of the 2015 Subordinated Notes from February 20, 2025 to June 20, 2026;
•
increased the interest rate under the 2015 Subordinated Notes from 8% to 9% per annum;
•
secured the obligation to pay the 2015 Subordinated Notes by the grant of a subordinate mortgage on our manufacturing facility in Berkeley, CA and parcels of land located in Vacaville, CA;
•
extended the expiration date of all 2022 A warrants to purchase shares of the Company’s common stock (the “A Warrants”) and 2022 B warrants to purchase shares of the Company’s common stock (the “B Warrants”) held by such noteholders to purchase a total of 97,500 shares of the Company’s common stock previously issued in 2022 to February 20, 2030 and changed the exercise price to $3.25 per share, which represented a 60-day volume weighted average price as of February 14, 2025 (the “Amended A Warrants” and “Amended B Warrants”);
•
issued to certain noteholders new warrants to purchase 67,500 shares of the Company’s common stock to expire February 20, 2030, and have an exercise price of $3.25 per share, (the “C Warrants” and, together with the Amended A Warrants and the Amended B Warrants, the “New Warrants”);
•
committed to registering the New Warrants with the Securities and Exchange Commission within ninety (90) days after February 20, 2025; and
•
provided that if we conduct a financing of greater than $10.0 million at a price per share below $3.25 before February 20, 2026, the exercise price on the New Warrants will be reduced to the same price at which such financing was conducted.

This Amendment was accounted for as a debt modification. As part of the Amendment, we recorded debt discount of approximately $0.4 million, representing the fair value of the new and modified warrants. This amount is presented net of the liability in our condensed consolidated balance sheets and will be amortized to interest expense over the term of the 2015 Subordinated Notes.