Outstanding Debt |
3 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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| Outstanding Debt | 8. Outstanding Debt The following two tables summarize outstanding debt as of March 31, 2026 and December 31, 2025, respectively (amount in thousands, except per share amounts):
Notes Payable During the three months ended March 31, 2026, the Company issued approximately 20.9 million shares of common stock with a fair value of $5.2 million to certain lenders in lieu of cash payments of $4.0 million of debt, including $0.8 million of accrued interest. In addition, the Company has extinguished certain debt pursuant to exchange agreements executed with various holders pursuant to which the Company issues common stock at a price based on a limited pricing period (the “Share payable”). During the three months ended March 31, 2026, the Company settled $0.2 million of Share payables and accrued $0.3 million of Share payables. The Company recognized an approximately $1.3 million debt extinguishment loss during the three months ended March 31, 2026 from the debt redemption. Convertible Notes During the three months ended March 31, 2026, the Company entered into a one-year convertible note and several two-year convertible notes (collectively the “Convertible Notes”) with multiple individual investors (the “Holders”) with an aggregate principal amount of $1.5 million. The Convertible Notes bear interest at 11% per annum and are convertible into common shares between $0.21 and $0.23 per share at the Holders’ option. During the three months ended March 31, 2026, the Company modified a convertible note that was originally issued in February 2024 by extending the maturity date. The modification was accounted for as a debt extinguishment. As a result, the Company recognized approximately $0.1 million of debt extinguishment loss during the three months ended March 31, 2026 from this debt amendment. During the three months ended March 31, 2026, the Company converted $0.3 million of convertible notes including $6,000 accrued interest into 1.5 million shares of common stock at a conversion price of $0.21 per share. Convertible Notes at Fair Value On January 26, 2026, the Company entered into a one-year convertible note (the “January Convertible Note”) with an individual investor (the “Holder”) for principal amount of $1.0 million. The January Convertible Note bears interest at 11% per annum and is convertible into common shares at $0.25 per share at the Holder’s sole option. In addition, the Holder has the right to purchase an additional two-year convertible note (the “Additional Note”) within 18 months from the issuance date of the January Convertible Note. The Additional Note shall not exceed $0.8 million and will have a conversion price at $0.50 per share. On March 4, 2026, the Company entered into several convertible note agreements (the “March Convertible Notes”) with various commercial lenders (the “March Holders”) for an aggregate principal amount of $5 million. The March Convertible Notes bear interest at 9% per annum with a 24-month term. The March Convertible Notes are convertible into the Company’s common stock at a conversion price equal to 86% of the daily VWAP during the 10 consecutive trading days immediately after the conversion notice submission date. The amounts of such conversions are limited to 20% of the principal during any rolling 20 trading day period. The conversion restrictions will be lifted upon the Company obtaining regulatory approval of the Company’s DCVax®-L treatment for glioblastoma. In addition, the Company incurred approximately $0.5 million of issuance costs associated with the March Convertible Notes, which was recognized in interest expense on the condensed consolidated statement of operations due to the Company applying the FVO, as describe below. The Company elected the FVO to fair value the January Convertible Note and the March Convertible Notes (collectively the “Convertible Notes at Fair Value”) on the issuance date and will subsequently remeasure at end of each reporting period. The estimated fair value of the Convertible Notes at Fair Value on the issuance date was approximate $6.7 million. The Company recognized a loss of $0.7 million upon the issuance of the Convertible Notes at Fair Value which was calculated at the difference between the principal amount and the fair value of the Convertible Notes at Fair Value. During the three months ended March 31, 2026, the Company modified certain existing convertible notes by (i) extending the maturity dates; (ii) modifying the holder’s right to purchase additional note in the future, (iii) reducing the conversion price, and (iv) modifying the principal amount. The modifications were accounted for as a debt extinguishment as the conversion feature of the amended notes were substantially different from the original terms. As a result, the Company recognized approximately $3.3 million of debt extinguishment loss during the three months ended March 31, 2026 from these debt amendments. During the three months ended March 31, 2026, the Company converted $3.3 million of certain convertible notes into 16 million shares of common stock at a weighted average conversion price of $0.21 per share. For the three months ended March 31, 2026 and 2025, interest expense related to outstanding debt totaled approximately $2.2 million and $1.6 million including amortization of debt discounts totaling $0.3 million and $0.3 million, respectively. |
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