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

5. Loans Payable

 

Loans

 

On May 1, 2022, the Company entered into Loan Agreements (the “Loans”) with two lenders, totaling $0.2 million. The Loans mature two years from the date of the agreement and bear no interest. Each loan was made available to the Company by the lenders in three tranches of (i) $33,000 (£30,000); (ii) $33,000 (£30,000) and (iii) $28,000 (£25,000), totaling $0.2 million. The Loans provided for events of default, including, among others, failure to make payment, bankruptcy and non-compliance with the terms of the Loans. As of December 31, 2024, the Company utilized all three tranches of the first loan and two out of three tranches of the second loan, with loans payable totaling $0.2 million.

 

On October 9, 2024, the Company and holders of the Loans amended the loan agreements (the “Loans Amendment”) to extend the maturity date for the Loans to December 19, 2024. The Loans Amendment also modified the payment terms for the Loans from a cash payment of £85,000 per loan to (1) a cash payment of £60,000, (2) £25,000 worth of shares of Common Stock converted into USD at the prevailing exchange rate, to be issued at the closing market price on the date prior to issuance, and in consideration for the extension, and (3) 2,500 additional shares of Common stock. On October 11, 2024, the Company issued each of the Loan holders 5,690 shares (11,380 in total).

 

The Company repaid the lenders the outstanding principal balance of $0.1 million in February 2025, in which no obligations remain under the terms of the Loans. No interest expense was recorded for each of the three months ended March 31, 2025 and March 31, 2024.

 

October 2024 Nirland Note

 

On October 28, 2024, the Company issued a promissory note (the “October 2024 Nirland Note”) to Nirland, a related party, in the original principal amount of $0.6 million in exchange for funds in such amount. See Note 16 for further reference to the relationship between the Company and Nirland. The October 2024 Nirland Note bore interest at a rate of 12% per annum, was due and payable semi-annually in arrears, and was scheduled to mature on October 31, 2025. If an event of default under and as defined in the October 2024 Nirland Note occurs, the interest rate would have been be increased to 18% per annum or to the maximum rate permitted by law. In connection with the October 2024 Nirland Note, the Company has agreed to pay Nirland a 1% arrangement fee, which was included with the principal and interest owed under the October 2024 Nirland Note. The 1% arrangement fee is accounted for as a debt discount and was amortized to interest expense, net in the consolidated statement of operations and comprehensive income (loss) using the effective interest method over the life of the October 2024 Nirland Note.

 

 

On December 11, 2024, the Company reduced the exercise price of the PIPE Warrants held by Nirland to $8.83, at which time all PIPE Warrants were exercised. The Company received approximately $0.2 million of proceeds from the exercise of the Warrants, all of which were used to pay down the October 2024 Nirland Note.

 

The Company repaid principal and interest of $0.1 million, $0.2 million, and $0.1 million on January 14, 2025, January, 31, 2025, and February 7, 2025, respectively. As of March 31, 2025, no obligations remain under the October 2024 Nirland Note.

 

During the three months ended March 31, 2025, the Company recorded approximately $8,000 of interest expense.