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Debt
 12 Months Ended
Dec. 31, 2025
Debt Disclosure [Abstract]  
Debt

7. Debt

 

The Company’s outstanding debt obligations as of December 31, 2025 and 2024, including related party components, are as follows (in thousands):

 

   December 31, 2025 
  

Unpaid

Balance

  

Accrued

Interest

  

Net Carrying

Value

 
Promissory note  $600   $90   $690 
Less: current portion of long-term debt             (90)
Long-term debt, net of current portion            $600 

 

   December 31, 2024 
  

Unpaid

Balance

  

Accrued

Interest

  

Net Carrying

Value

 
Term notes payable  $2,200   $753   $2,953 
Bridge loan payable   200    23    223 
Promissory note   600    45    645 
Total debt  $3,000   $821   $3,821 
Less: current portion of long-term debt             (3,221)
Long-term debt, net of current portion            $600 

 

Scheduled maturities of outstanding debt, net of discounts as of December 31, 2025 are as follows (in thousands):

 

Year Ending December 31:    
2026   — 
2027   600 
2028 and thereafter   — 
Plus: accrued interest   90 
Total debt  $690 

 

The following discussion includes a description of the Company’s outstanding debt as of December 31, 2025 and 2024. The weighted average interest rate related to the Company’s outstanding debt was approximately 15% and 14.4% as of December 31, 2025 and 2024, respectively. Interest expense related to the Company’s outstanding debt totaled approximately $0.1 million and $0.7 million for the year ended December 31, 2025 and 2024, respectively, which is reported within other income, net, in the consolidated statements of operations.

 

Term Notes Payable

 

2021 Term Note Payable

 

In January 2021, the Company entered into a note agreement with a related party investor and director to borrow up to $0.5 million (“2021 Term Note”).

 

As of December 31, 2024, the interest rate of the 2021 Term Notes was 14%, and the total carrying value, including accrued interest was approximately $0.7 million. The total outstanding principal and accrued interest of 2021 Term Note of $0.7 million was settled in full in January 2025. As of that date, the 2021 Term Notes were no longer outstanding.

 

 

2022 Term Notes Payable

 

In November and December 2022, the Company issued $1.5 million of secured term notes payable (the “2022 Term Notes”) to investors, including to related parties (see Note 6).

 

On October 3 and November 8, 2023, the Company settled in cash $0.1 million and $0.2 million, respectively, of the principal of 2022 Term Notes plus accrued interest. Said term notes payable were no longer outstanding as of the settlement dates.

 

As of December 31, 2024, the interest rate of the 2022 Term Notes was 14% per annum, for a total principal of $0.2 million, and 16% per annum, for a total principal of $0.2 million. As of December 31, 2024, the total carrying value, including accrued interest, was $0.4 million. The total outstanding principal and accrued interest of 2022 Term Notes of $0.4 million was settled in full in January 2025. As of that date, the 2022 Term Notes were no longer outstanding.

 

2023 Term Notes Payable

 

From January through September 2023, the Company issued $3.3 million of secured term notes payable (the “2023 Term Notes”) to investors, including to related parties (see Note 6).

 

On October 3, 2023, as agreed upon above in connection with the Closing of the FLAG Merger, the Company settled in cash $0.6 million of principal of 2023 Term Notes plus accrued interest and said term notes payable were no longer outstanding as of that date.

 

During the year ended December 31, 2024, the Company settled in cash $0.3 million of principal of 2023 Term Notes plus accrued interest. On December 23, 2024, the Company executed a debt amendment on $1.0 million of the 2023 Term Notes, which modified the repayment terms commencing on February 1, 2025, such that the Company will pay the holder, a related party, $0.1 million each month until the 2023 Term Notes’ principal and interest are fully paid. The principal shall continue accruing interest of 14% per annum until fully paid.

 

As of December 31, 2024, the interest rate was 14% per annum for a total principal of $1.2 million and 18% per annum for a total principal of $0.2 million, respectively. As of December 31, 2024, the total carrying value, including accrued interest and net of debt discount, was $1.9 million.

 

As of December 31, 2025, the total outstanding principal and accrued interest of the 2023 Term Notes of $1.4 million was fully paid in accordance with the agreement and was no longer outstanding.

 

2024 Bridge Loan

 

On January 19, 2024, the Company received approximately $0.2 million in aggregate proceeds from the issuance of certain bridge loans (the “2024 Bridge Loan”), which mature one year from the issuance date and bear simple interest of 12% per annum. As consideration for the 2024 Term Loans, the Company issued an aggregate of 75 shares of restricted common stock to the Lender.

 

As of December 31, 2024, the total carrying value of the 2024 Bridge Loan, including accrued interest and net of debt discount, was $0.2 million which was settled in full in January 2025. As of that date, the 2024 Bridge Loan was no longer outstanding.

 

Convertible Promissory Notes

 

On January 26, 2024, the Company entered into a convertible promissory note purchase agreement (the “2024 Purchase Agreement”) with an Accredited Investor (the “Investor”) for a loan in the principal amount of $1.0 million (the “2024 Convertible Note Loan”). In connection with the Convertible Note Loan, the Company issued a one-year convertible promissory note evidencing the aggregate principal amount of $1.0 million under the Loan, which accrues at a 12% simple interest rate per annum (the “2024 Convertible Note”).

 

On April 18, 2024, pursuant to the April Public Offering, the Company’s $1.0 million convertible note, inclusive of outstanding principal and accrued interest, was automatically converted into shares of Common Stock Units, with terms identical to those sold in the April Public Offering. As of that date, the convertible note was no longer outstanding.

 

 

Promissory Note Loan Agreement

 

On July 1, 2024, the Company entered into a Loan Agreement with a third party lender (the “Lender”). Under the Loan Agreement, the Lender agreed to loan the Company the principal amount of $0.6 million pursuant to the terms of the promissory note dated July 1, 2024 (the “Promissory Note”), which bears a simple interest rate at 15% per annum and matures on the third calendar year from July 1, 2024 (the “Maturity Date”) unless due earlier due to an event of a default. The Company agreed to pay annual payments of accrued interest after each calendar year from the Payment Date until any remaining interest is paid in full on the Maturity Date.

 

As of December 31, 2025 and 2024, the total carrying value of the promissory note, including accrued interest, was $0.7 million and $0.6 million, respectively.