Debt Obligations |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Debt Disclosure [Abstract] | |
| Debt Obligations | Debt Obligations Hercules Term Loan. In May 2026, the Company and its subsidiaries entered into a loan and security agreement with Hercules Capital, Inc. and certain of its affiliates (“Hercules”) that provides up to $100 million in borrowing capacity (the “Hercules Term Loan”) available in three tranches, each maturing in May 2030. The first $55 million tranche was funded at closing. The second $20 million tranche is available for draw at the Company’s option by no later than June 15, 2028, subject to the achievement of specified performance milestones and certain additional timing restrictions. The third $25 million tranche is available for draw at the Company’s option, subject to Hercules’s consent, at any time prior to the expiration of the interest-only payment period. A final payment (equal to 6.25% of the amount funded under the Hercules Term Loan), is due upon prepayment or maturity of the loan. Additionally, the Company may prepay the Hercules Term Loan in whole or in part at its option at any time. Any prepayment of the Hercules Term Loan is subject to prepayment fees initially equal to 3.0% of the outstanding principal being repaid, subject to a declining scale depending on when prepayment occurs relative to the applicable closing date. Warrants. In connection with the loan and security agreement, the Company agreed to grant Hercules warrants to purchase a number of shares of its common stock equal to 2% of the aggregate principal amount of the Hercules Term Loan made and funded under the loan and security agreement at an exercise price of $1.59 per share. Concurrent with the funding of the first tranche, the Company granted Hercules warrants to purchase 691,823 shares of its common stock. Upon funding of the second and third tranches, the Company will grant Hercules warrants to purchase an additional 251,572 and 314,465 shares of its common stock, respectively. The warrants are exercisable for a five-year period from the date of issuance. The Company used the Black-Scholes model to calculate the fair value of the warrants which are reflected in other long-term liabilities on the consolidated balance sheet and reduced the initial carrying value of long-term debt. The fair value was recorded using assumptions of stock price volatility, the expected life of the warrants and the fair value of the common stock underlying the warrants, among other assumptions and will be remeasured each reporting period with changes in fair value recorded in the condensed consolidated statement of comprehensive loss within interest and other expense. Interest, Principal Payments, and Carrying Value of Debt. Monthly interest-only payments are due during an initial 18-month period, which may be extended to 24 months or 30 months if specified performance milestones are achieved. The interest-only period will be followed by an amortization period extending through the maturity date. The Hercules Term Loan bears interest at a floating rate equal to the prime rate plus 3.10%, but not less than 9.85%. For the quarter ended June 30, 2026, the interest rate of the Hercules Term Loan was 9.85%. Payments of $3.5 million, $21.3 million, $21.3 million and $12.3 million, including debt principal and the final payment noted above, will be during the fiscal years ended December 31, 2027, December 31, 2028, December 31, 2029 and December 31, 2030, respectively. As of June 30, 2026, the carrying value of the Hercules Term Loan in long-term debt on the condensed consolidated balance sheet was $51.4 million primarily reflecting the unamortized balance of debt issuance costs and discounts totaling $3.7 million, which are being amortized into interest and other expense over the life of the loan. Restrictive Provisions/Covenants. The Company’s obligations under the Hercules Term Loan are secured by a first lien security interest in all of the assets of the Company and its subsidiaries. Financial covenants include (a) a minimum cash covenant beginning on June 1, 2027, which will be extended to January 1, 2028 upon achievement of specified performance milestones and waived at any time the Company meets specified market capitalization requirements and (b) a minimum revenue covenant relating to net sales of its products beginning only at specified times after the Company draws the second or third tranche, which will be waived at any time the Company meets specified minimum cash and/or market capitalization requirements. The Company was in compliance with its debt covenants as of June 30, 2026. Oxford Term Loans. Concurrent with its execution of the loan and security agreement with Hercules in May 2026, the Company repaid the remaining $54.3 million (including pro-rata final payment exit fees equal to 7% of the amount funded) under the Oxford Term Loans. In April 2025, December 2025 and February 2026, the Company repaid $45 million, $3 million and $5 million to Oxford, respectively, including pro-rata final payment exit fees equal to 7% of the amount funded under the Oxford Term Loans. In connection with the repayment of the Oxford term loans in May 2026, the Company recorded a loss on early extinguishment of debt of $4.3 million and is no longer subject to the $29 million minimum restricted cash requirement. For additional information on the Company’s long-term debt obligations, refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.
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