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FAIR VALUE MEASUREMENTS
 3 Months Ended
Mar. 31, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE MEASUREMENTS FAIR VALUE MEASUREMENTS
The Company’s financial instruments consist of cash, accounts payable, accrued expenses, derivative liability, warrant liability, and borrowings under its credit facilities. The Company believes that the carrying amounts of its financial instruments, including cash, accounts payable and accrued expenses approximate their fair values due to the short-term maturities of these instruments. The Company measures its derivative liability and warrant liability at fair value on a recurring basis. Borrowings under the Company’s credit facilities are carried at amortized cost; however, their estimated fair values are disclosed below. The Company uses a third-party valuation firm to assist in determining the fair value of certain financial instruments.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The Company classifies its financial instruments within the fair value hierarchy based on the lowest level of input that is significant to the fair value measurement. The hierarchy is as follows:

Level 1 — Quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company can access at the measurement date.

Level 2 — Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly.

Level 3 — Unobservable inputs for the asset or liability that are used when observable inputs are not available.
New Revolving Facility
March 31, 2026December 31, 2025
Carrying amountFair valueCarrying amountFair value
New Revolving Facility$71,615 $73,282 $78,727 $79,090 

The New Revolving Facility is carried at amortized cost. As of March 31, 2026 and December 31, 2025, the unamortized debt discount and issuance costs associated with the New Revolving Facility were $2.8 million and $3.8 million, respectively. The estimated fair value of the New Revolving Facility was determined using Level 2 inputs based on an estimated credit rating for the Company and the trading value of similar debt instruments with comparable credit characteristics.

Derivative Liability

The Company’s derivative liability consists of a compound embedded derivative associated with the Series A Convertible Preferred Stock and Series B Convertible Preferred Stock (the “Convertible Preferred Derivative”).

Fair Value Measurement Using (as of March 31, 2026)
Level 1Level 2Level 3Total
Convertible Preferred Derivative$— $— $9,300 $9,300 

Level 3 Rollforward - Derivative Liability ( March 31, 2026)
Balance at December 31, 2025
Change in fair value recognized in earnings
Conversions/ settlements
Balance at March 31, 2026
Convertible Preferred Derivative
$13,600 $(4,300)$— $9,300 

The Convertible Preferred Derivative arises from the contingent redemption feature and the conversion feature embedded in those instruments (see Note 6 for further information). Both features are aggregated and valued together as a compound derivative. The mandatory redemption and conversion features do not meet the equity classification criteria under ASC 815-40 because they are not indexed solely to the Company’s own stock and are therefore accounted for as an embedded derivative instrument. Accordingly, the mandatory redemption and conversion features were bifurcated from the host convertible preferred
stock and recorded as a derivative liability at fair value, with subsequent changes in fair value recorded in “Change in fair value of derivative liability and warrants” in the condensed consolidated statements of operations.

The Convertible Preferred Derivative is classified within Level 3 of the fair value hierarchy and is remeasured at fair value at each reporting date, with changes recognized in earnings. The decrease in fair value during the three months ended March 31, 2026 was primarily driven by a shorter expected time to a potential liquidity event and changes in the Company’s stock price.

The significant assumptions used in valuing the derivative liabilities as of March 31, 2026 include the following:

Convertible Preferred Derivative
AssumptionsSeries A Convertible Preferred StockSeries B Convertible Preferred StockUnits
Time to Liquidity0.150.15Years
Risk free rate (continuous)3.7%3.7%Percent per annum
Volatility90.0%90.0%Percent
Dividend Rate
12% - 18%
12% - 18%
Percent per annum
Discount Rate19.0%18.0%Percent per annum

Warrant Liability
Warrant liability - Public (Level 1) & Private Warrants (Level 3)
Fair Value Measurement Using
Level 1Level 2Level 3Total
Balance at December 31, 2025
$45 $— $1 $46 
Change in fair value
(16)— — (16)
Balance at March 31, 2026$29 $— $1 $30 

Changes in the fair value of the warrant liability are recorded in “Change in fair value of derivative liability and warrants” in the condensed consolidated statements of operations.

During the three months ended March 31, 2026 and 2025, there were no transfers between levels.