Related Party Transactions and Balances |
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| Related Party Transactions and Balances | Note 9. Related Party Transactions and Balances Transactions with the Sponsor and its affiliates Sales Partner Referral Agreement On June 30, 2025, the Company entered into a Sales Partner Referral Agreement (the “Referral Agreement”) with Burkhan LLC (the “Sales Partner”), an affiliate of BurTech LP, LLC (the “Sponsor”). The Referral Agreement has an initial approved customer of BurTech Systems Tech LLC (“BST”), an affiliate of the Sales Partner. Under the agreement, BST will purchase, subject to the issuance of purchase orders, up to $56.5 million of the Company’s products on behalf of a certain unaffiliated end user. The Sales Partner will receive a commission from the Company of up to 10%, depending on the Company’s gross margins under the purchase order. The sales commission is payable in cash, or, partially, at the Company’s discretion, in shares of the Company’s common stock. The commission is payable to BST once the Company receives cash from these sales. During the three months ended March 31, 2026, the Company recognized $2.6 million in revenue from the Referral Agreement, inclusive of sales commissions of $0.3 million, which was reported as a reduction of revenue, and paid fully in cash. Other earnout shares - related party A portion of the “other earnout shares” were issued to an affiliate of the Sponsor at the time of the Merger. See Note 6 — “Common Stock, Currently Outstanding Warrants to Purchase Common Stock, and Earnout Shares”. The fair value of these other earnout shares as of March 31, 2026 and December 31, 2025 was $2.0 million and $2.2 million, respectively, as set forth on the Company’s condensed consolidated balance sheets as of each period. Working capital loan - related party Immediately prior to the consummation of the Merger, the Company issued an unsecured promissory note to the Sponsor, pursuant to which it borrowed $1.5 million for general corporate purposes. On the date of the Merger, this loan was recorded on the Company’s condensed consolidated balance sheets, and was outstanding as of March 31, 2026 and December 31, 2025. Repayment has been demanded by the Sponsor. Advances from related party Immediately prior to the consummation of the Merger, the Sponsor provided the Company with certain working capital advances, which are non-interest bearing and payable on demand, in the amount of $2.9 million. These amounts are reflected on the condensed consolidated balance sheets as of March 31, 2026 and December 31, 2025 as “advances from related party”. Repayment has been demanded by the Sponsor. Accounts payable - related party The Company owed management fees in the amount of $0.2 million to the Sponsor as of March 31, 2026 and December 31, 2025. These amounts are reflected on the condensed consolidated balance sheets as “accounts payable - related party”. Shareholder note receivable Immediately prior to the consummation of the Merger, the Sponsor issued a secured promissory note and pledge agreement (the “shareholder note receivable”) to the Company which will decrease when the Sponsor pays for transaction costs that the Company assumed from the Sponsor during the Merger. The shareholder note receivable is secured by collateral of 2,000,000 shares of the Company’s common stock owned by the Sponsor. As of March 31, 2026 and December 31, 2025, the outstanding principal of the shareholder note receivable was $8.6 million, the amount of which has been deducted from additional paid-in capital on the Company’s condensed consolidated balance sheets as of that date. Non-Redemption Agreements On December 31, 2024 and through January 13, 2025, the Company, its Sponsor, and Legacy Blaize entered into non-redemption agreements with several unaffiliated stockholders (each, an “Investor”) who agreed not to redeem (or, alternately, to validly rescind any redemption requests on) their shares of common stock (“Non-Redeemed Shares”) through up to 180 days after the Closing Date. These Non-Redeemed Shares were exchanged for shares of the Company’s common stock and were held in a separate escrow account. In exchange for the foregoing commitments not to redeem the Non-Redeemed Shares, the Sponsor agreed to guarantee that each Investor receive a return of $1.50 per Non-Redeemed Share held in a related cash escrow account, subject to certain conditions. The Sponsor, and not the Company, was contractually obligated for the $1.50 per share premium related to these non-redemption agreements. Accordingly, the Company did not recognize a non-redemption liability for the Sponsor’s commitment. Transactions with other related parties Transactions with other related parties for advisory and marketing services, and a related party employed by the Company are set forth in the table below:
(1) Marketing expenses were incurred with a company owned by a direct family member of a minority stockholder and member of the Company’s Board of Directors. (2) A relative of one of the Company’s named executive officers is employed by the Company. Compensation received is presented in “included in selling, general and administrative - related party” for the three months ended March 31, 2026.
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