v3.25.2
Fair Value Measurement
 6 Months Ended
Jun. 30, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurement Fair Value Measurement
Accounting standards establish a hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:
Level 1 - Quoted prices in active markets for identical assets or liabilities.
Level 2 - Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3 - Inputs that are generally unobservable and typically reflect management’s estimate of assumptions that market participants would use in pricing the asset or liability.
The carrying value of cash and cash equivalents, restricted cash, accounts receivable and accounts payable are considered to be representative of their fair value due to the short maturity of these instruments.
The following tables set forth the Company's financial liabilities measured at fair values based on the fair value hierarchy, as described above. These should also be read with Note 2, Summary of Significant Accounting Policies, in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.
June 30, 2025
December 31, 2024
Level 1Level 2Level 3Level 1Level 2Level 3
Liabilities
SPA Warrant (a)
$— $— $198,984 $— $— $188,857 
Contingent warrants (a)
$— $— $— $— $— $77,773 
IPO, April, May and December 2023 Warrants (b)
$— $105 $181,093 $— $269 $189,322 
Delayed Draw Term Loan$— $— $61,705 $— $— $76,188 
Embedded derivatives(c)
$— $— $51,639 $— $— $44,396 
Total liabilities
— $105 $493,421 $— $269 $576,536 
(a) Included in Warrants liability - Related party on the Unaudited Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024.
(b) All these instruments are Level 3, except for the IPO warrants (Level 2). These are included in Warrants liability on the Unaudited Condensed Consolidated Balance Sheets.
(c) Included in Notes Payable - Related Party on the Unaudited Condensed Consolidated Balance Sheets as of June 30, 2025 and December 31, 2024.

Each of the following recurring level 2 and level 3 instruments’ valuation model used to determine fair value is disclosed in the Company’s Annual Report on the Form 10-K for the year ended December 31, 2024.
IPO Warrants
The IPO warrants are valued on the basis of the quoted price of the Company’s public warrants, adjusted for insignificant difference between the public warrants and the private placement warrants.
April 2023 warrants, May 2023 warrants and December 2023 warrants
The April 2023 warrants, May 2023 warrants and December 2023 warrants all are valued using the Black-Scholes model at inception and on subsequent valuation dates. This model incorporates inputs such as the stock price of the Company, risk-free interest rate, volatility and time to expiration. The volatility is a significant unobservable input classified as Level 3 of the fair value hierarchy.
The inputs used to determine the fair value of the April 2023 warrants, May 2023 warrants, and the December 2023 warrants are as follows:
April 2023 warrants
June 30, 2025
December 31, 2024
Time to expiration3.29 years3.79 Years
Common stock price$5.12 $4.86 
Risk-free interest rate3.7 %4.3 %
Volatility100.0 %90.0 %
May 2023 warrants
June 30, 2025
December 31, 2024
Time to expiration3.04 years3.54 Years
Common stock price$5.12 $4.86 
Risk-free interest rate3.7 %4.3 %
Volatility100.0 %90.0 %
December 2023 warrants
June 30, 2025
December 31, 2024
Time to expiration3.46 Years3.96 Years
Common stock price$5.12 $4.86 
Risk-free interest rate3.7 %4.3 %
Volatility100.0 %90.0 %
Embedded derivatives
The Company estimated the fair value of the embedded conversion features in the 2021 Convertible Note and the AFG Convertible Notes using a binomial lattice model at inception and on subsequent valuation dates. This model incorporates inputs such as the stock price of the Company, dividend yield, risk-free interest rate, the effective debt yield and expected volatility. The effective debt yield and volatility involve unobservable inputs classified as Level 3 of the fair value hierarchy. On June 3, 2025, the Company repurchased the full $122,868 aggregate principal amount outstanding for the 2021 Convertible Note in a privately negotiated transaction. As such there was no derivative liability associated with the 2021 Convertible Note at June 30, 2025.
The inputs used to determine the fair value of the embedded derivative liabilities are as follows:
2021 Convertible Note
June 03, 2025
December 31, 2024
Term1.08 Years1.50 Years
Dividend yield— %— %
Risk-free interest rate4.1 %4.2 %
Volatility60.0 %65.0 %
Common stock price$3.86 $4.86 
Effective debt yield24.0 %30.0 %
AFG Convertible Note
June 30, 2025December 31, 2024
Term1.00 Years1.50 Years
Dividend yield— %— %
Risk-free interest rate3.9 %4.2 %
Volatility60.0 %65.0 %
Common stock price$5.12 $4.86 
Effective debt yield25.0 %30.0 %
Accounting for instruments resulting from the Credit and Securities Purchase Transaction
The Loan commitment assets were measured at fair value as of June 21, 2024 (see Note 3, Credit and Securities Purchase Transaction). The fair value was $76,091 at issuance calculated using the discounted cash flow model. They will not be subsequently remeasured at fair value.
The following table summarizes instruments that were initially and subsequently measured at fair value. (see Note 3, Credit and Securities Purchase Transaction):
InstrumentInitial measurement dateInitial Fair Value
Initial Draw of the Delayed Draw Term Loan6/21/2024$25,653 
SPA Warrant6/21/2024$32,903 
Contingent Warrants6/21/2024$62,191 
August Draw of the Delayed Draw Term Loan8/29/2024$12,528 
October Draw of the Delayed Draw Term Loan10/31/2024$28,340 
January Draw of the Delayed Draw Term Loan
1/24/2025$17,312 
The fair value of each draw of the Delayed Draw Term Loan was estimated using a discounted cash flow (“DCF”) method, based on the contractual cash flows discounted at a debt yield and considering the probability of achieving certain milestones.
The fair value for the SPA warrant is estimated based on its intrinsic value, using the Eos common stock closing price adjusted by a discount for lack of marketability (“DLOM”), less the exercise price of $0.01 for the SPA Warrant. A DLOM was applied considering the underlying shares of the SPA Warrants are unregistered.
The fair value of the Contingent Warrants is estimated based on the underlying Eos common stock closing price adjusted by a DLOM using Black-Scholes option pricing model, considering the probability of achieving certain milestones. A DLOM was applied considering the underlying shares of the Contingent Warrants are unregistered.
The fair values for all the above instruments are designated as level 3 measurements as they rely on significant unobservable inputs. The significant unobservable inputs for each of these instruments are disclosed in the tables below. All other inputs used are observable.

Quantitative information about all significant unobservable inputs used in the fair value measurement for non-recurring level 3 measurements:

Loan Commitment Assets:
June 21, 2024
Milestones achievement expectations
Very high probability
Debt yield
47.5 %
Quantitative information about all significant unobservable inputs used in the fair value measurement for recurring level 3 measurements:

Delayed Draw Term Loan Initial Tranche
June 21, 2024December 31, 2024
June 30, 2025
Debt yield
47.5 %30.0 %25.0 %
Contingent Warrants- all tranches
June 21, 2024December 31, 2024
Milestones achievement expectations
Very high probabilityVery high probability
Volatility
70.0 %65.0 %
Discount for lack of marketability (“DLOM”)
10.0 %10.0 %
SPA Warrant
June 21, 2024December 31, 2024
June 30, 2025
Discount for lack of marketability (“DLOM”)
10.0 %10.0 %10.0 %
Delayed Draw Term Loan August Draw
August 31, 2024December 31, 2024
June 30, 2025
Debt yield
42.5 %30.0 %25.0 %
Delayed Draw Term Loan October Draw
October 31, 2024December 31, 2024
June 30, 2025
Debt yield
42.5 %30.0 %25.0 %
Delayed Draw Term Loan January Draw
January 24, 2025
June 30, 2025
Debt yield
30.0 %25.0 %
Delayed Draw Term Loan Prepayment
June 4, 2025
Debt yield
25.0 %
Level 3 Rollforward for Liabilities Measured at Fair Value on a Recurring Basis
The following table summarizes the changes in the fair value of liabilities that are included within the Company’s accompanying Unaudited Condensed Consolidated Balance Sheets and are designated as Level 3:
Three Months Ended June 30,
Six Months Ended June 30,
2025
2024
2025
2024
Delayed Draw Term Loan
Balance at beginning of the period$99,433 $— $76,188 $— 
Additions - Initial Draw— 25,653 — 25,653 
Additions - January Draw
— — 17,312 — 
Prepayment of the Term Loan
(28,582)— (28,582)— 
Change in fair value of Term Loan(9,146)240 (3,213)240 
Balance at end of the period$61,705 $25,893 $61,705 $25,893 
SPA Warrant and Contingent Warrants
Balance at beginning of the period$146,793 $— $266,630 $— 
Additions— 95,094 — 95,094 
Conversion to preferred stock
— — (102,185)— 
Change in fair value of warrants52,191 46,202 34,539 46,202 
Balance at end of the period$198,984 $141,296 $198,984 $141,296 
April, May, and December 2023 Warrants
Balance at beginning of the period$124,766 $24,512 $189,322 $27,406 
Additions— — — — 
Exercised warrants
(1,571)— (20,339)— 
Change in fair value of warrants57,898 7,938 12,110 5,044 
Balance at end of the period$181,093 $32,450 $181,093 $32,450 
Embedded derivatives
Balance at beginning of the period$27,462 $3,889 $44,396 $4,423 
Extinguishment of the 2021 Convertible Notes embedded derivatives
(87)— (87)— 
Change in fair value of derivatives
24,264 1,525 7,330 991 
Balance at end of the period$51,639 $5,414 $51,639 $5,414 
The estimated fair value of financial instruments not carried at fair value in the Unaudited Condensed Consolidated Balance Sheets was as follows:
Level in fair value hierarchy
June 30, 2025
December 31, 2024
Carrying ValueFair ValueCarrying ValueFair Value
Notes receivable3$— $— $847 $740 
Loan commitment assets
3— — 21,731 21,051 
2021 Convertible Note*3— — 109,838 91,951 
2025 Convertible Notes
3239,251 285,000 — — 
AFG Convertible Notes*375,225 77,613 63,033 65,053 
Equipment financing facility31,073 1,036 2,385 2,097 
Preferred Stock
3532,269 575,605 488,696 454,581 
DOE Loan Facility
368,023 70,708 65,452 67,740 
  Total$915,841 $1,009,962 $751,982 $703,213 
*Includes the embedded derivative liabilities.