The Company's assets and liabilities which are measured at fair value include short-term investments, the promissory note and warrants for common stock. All assets and liabilities recorded at fair value are revalued at each measurement period.

The Company elected the fair value option for the promissory note and estimated the fair value based on a discounted cash flow analysis, a form of the Income Approach. Several different settlement scenarios were considered, and probability weighted to arrive at the final valuation. Increases or decreases in the fair value of the promissory note can result from updates to assumptions such as the expected timing or probability of the different settlement scenarios, or changes in discount rates. Judgment is used in determining these assumptions as of the initial valuation date and at each subsequent reporting period. Updates to assumptions could have a significant impact on our results of operations in any given period.

The Common Warrants (as defined in Note 6 below) were valued using Black-Scholes utilizing the following inputs; (i) a risk-free interest rate; (ii) volatility based on the expected term of the Common Warrant; (iii) and an exercise price and stock price on the date of the transaction. Several different scenarios were considered, and probability weighted to arrive at the final valuation. Increases or decreases in the fair value of the Common Warrants can result from updates to assumptions such as the expected timing or probability of the different settlement scenarios. Judgment is used in determining these assumptions as of the initial valuation date and at each subsequent reporting period. Updates to assumptions could have a significant impact on our results of operations in any given period.

The Company utilizes valuation techniques that maximize the use of observable inputs and minimize the use of unobservable inputs to the extent possible. The Company determines fair value based on assumptions that market participants would use in pricing an asset or liability in the principal or most advantageous market. When considering market participant assumptions in fair value

measurements, the following fair value hierarchy distinguishes between observable and unobservable inputs, which are categorized in one of the following three levels:

The following tables present information about the Company’s financial assets measured at fair value on a recurring basis and indicates the level of the fair value hierarchy utilized to determine such fair values (in thousands):


	March 31, 2025
	Level 1		Level 2		Level 3		Total
Current assets:
Cash equivalents:
Money market funds	$	9,476	$	—	$	—	$	9,476
Commercial paper		—		1,991		—		1,991
Corporate debt securities		—		649		—		649
U.S. Treasury bills		—		248		—		248
Total cash equivalents		9,476		2,888		—		12,364
Short-term investments:
Commercial paper		—		8,652		—		8,652
U.S. Treasury bills		—		1,982		—		1,982
U.S. Government sponsored entities - mortgage backed securities		—		1,435		—		1,435
Total short-term investments		—		12,069		—		12,069
Total assets measured at fair value	$	9,476	$	14,957	$	—	$	24,433


	December 31, 2024
	Level 1		Level 2		Level 3		Total
Current assets:
Cash equivalents:
Money market funds	$	6,117	$	—	$	—	$	6,117
Commercial paper		—		746		—		746
U.S. Treasury bills		—		749		—		749
Total cash equivalents		6,117		1,495		—		7,612
Short-term investments:
Commercial paper		—		6,573		—		6,573
U.S. Treasury bills		—		3,227		—		3,227
U.S. Government sponsored entities - mortgage-backed securities		—		934		—		934
Total short-term investments		—		10,734		—		10,734
Total assets measured at fair value	$	6,117	$	12,229	$	—	$	18,346

Money market funds are highly liquid investments which are actively traded. The pricing information on the Company’s money market funds is based on quoted prices in active markets for identical securities. This approach results in the classification of these securities as Level 1 of the fair value hierarchy.

Commercial paper, U.S Treasury bills and U.S. Government sponsored entities - mortgage-backed are classified as Level 2 with in the hierarchy and are carried at fair value with unrealized gains and losses included in other comprehensive (loss) income as a component of stockholders’ equity until realized. The Company estimates the fair values of these securities by taking into consideration valuations obtained from third-party pricing sources.

During the three months ended March 31, 2025, there were no transfers between Level 1, Level 2 and Level 3.

The following table presents information about the Company’s financial liabilities measured at fair value on a recurring basis and indicates the level of the fair value hierarchy utilized to determine such fair values (in thousands).


	March 31, 2025
	Level 1		Level 2		Level 3		Total
Liabilities:
Promissory Note	$	—	$	—	$	8,600	$	8,600
Warrant Liability		—		—		1,400		1,400
Total liabilities measured at fair value	$	—	$	—	$	10,000	$	10,000


	December 31, 2024
	Level 1		Level 2		Level 3		Total
Liabilities:
Warrant Liability	$	—	$	—	$	1,700	$	1,700
Total liabilities measured at fair value	$	—	$	—	$	1,700	$	1,700

The following provides a reconciliation for all liabilities measured at fair value using Level 3 inputs for the three months ended March 31, 2025 and 2024 (in thousands):


Promissory Note liability
Balance at December 31, 2024	$	—
Issuance of Promissory Note		8,923
Change in Fair Value of Promissory Note		(323	)
Balance at March 31, 2025	$	8,600

Warrant liability
Balance at December 31, 2024	$	1,700
Issuance of Lender Warrants	$	1,077
Change in Fair Value of Tranche B Warrants	$	(1,200	)
Change in Fair Value of Lender Warrants		(177	)
Balance at March 31, 2025	$	1,400

Balance at December 31, 2023	$	11,190
Change in Fair Value of Warrants		(5,590	)
Balance at March 31, 2024	$	5,600

The following table presents information as to cost, unrealized gains and losses and fair value determination of the Company’s financial assets measured at fair value on a recurring basis (in thousands):


	March 31, 2025
	Amortized Cost		Unrealized Gains		Unrealized Losses			Aggregate Fair Value
Current assets:
Cash equivalents:
Money market funds	$	9,476	$	—	$	—		$	9,476
Commercial paper		1,991		—		—			1,991
Corporate debt securities		649		—		—			649
U.S Treasury bills		248		—		—			248
Total cash equivalents		12,364		—		—			12,364
Short-term investments:
Commercial paper		8,653		—		(1	)		8,652
U.S Treasury bills		1,982		—		—			1,982
U.S. Government sponsored entities - mortgage-backed securities		1,435		—		—			1,435
Total short-term investments		12,070		—		(1	)		12,069
Total assets measured at fair value	$	24,434	$	—	$	(1	)	$	24,433

As of March 31, 2025, the contractual maturities of all available-for-sale investments were less than 12 months. The Company periodically reviews the available-for-sale investments for other-than-temporary impairment loss. The Company had short-term investments in unrealized loss positions as of March 31, 2025.

As of December 31, 2024, the contractual maturities of all available-for-sale investments were less than 12 months. The Company periodically reviews the available-for-sale for other-than-temporary impairment loss. The Company had short-term investments in unrealized gain positions as of December 31, 2024.