Note Payable |
6 Months Ended |
|---|---|
Jun. 30, 2026 | |
| Debt Disclosure [Abstract] | |
| Note Payable | Note 5. Note Payable
September 2025 Note
On September 22, 2025, the Company entered into a Secured Exchange Note Exchange Agreement with its existing Note holder, pursuant to which the parties agreed to exchange the Company’s outstanding notes (the “Prior Note”). As of the exchange date, the Prior Note had an outstanding principal balance of $1,220, bore interest at 8% per annum, and was scheduled to mature on December 31, 2025. Under the Exchange Agreement, the holder surrendered the Prior Note in exchange for (i) a new secured convertible promissory note (the “September 2025 Note”) issued in the principal amount of $1,220, bearing interest at 8% per annum and maturing on December 31, 2027, and (ii) shares of the Company’s common stock. The equity consideration was valued at $ per share, resulting in a fair value of $50 as of the issuance date. The September 2025 Note is convertible into common shares at $0.001 per share. The Company recorded interest expense of $25 and $49 for the three and six months ended June 30, 2026, respectively for this note. The Company recorded interest expense of $43 and $93 for the Prior Note for the three and six months ended June 30, 2025, respectively.
The Company reviewed the transaction under ASC 470-50 and concluded that the revised terms do not constitute a substantial modification. Accordingly, the transaction is accounted for as a modification of the existing November 2024 Note. The value of the equity in the transaction was $50 and recorded as a debt discount in accordance with ASC 470. The conversion feature added by the modification was determined to be non-substantive under ASC 470. No gain or loss was recognized because of the modification. The note continues to be carried at its previous amortized cost basis, adjusted for the $50 debt discount, which will be amortized over the remaining term of the note. For the three and six months ended June 30, 2026, the Company recorded $5 and $10, respectively in accretion of debt discount.
The September 2025 Note is classified as a long-term liability on the Company’s balance sheet as of December 31, 2025, as the maturity date exceeds one year from the reporting date. This note was extinguished on June 30, 2026.
Note Exchange Agreement
On June 30, 2026, the Company entered into an exchange agreement (the “Note Exchange Agreement”), whereby it issued shares of common stock and shares of a newly designated series of preferred stock, designated as Series E Convertible Preferred Stock, par value $ per share, which are convertible into common shares in consideration for the extinguishment of $1,220 in outstanding September 2025 Notes.
The equity consideration issued was valued at an aggregate fair value of $4,000 (consisting of $750 allocated to common stock par value, $3 allocated to preferred stock par value, and $3,247 allocated to additional paid-in capital). This resulted in a recognized non-operating loss on debt extinguishment of $2,814 for the three and six months ended June 30, 2026, representing the excess of the equity consideration’s fair value over the $1,186 net carrying value of the note (consisting of $1,220 in principal less $34 in remaining unamortized debt discount) immediately prior to settlement.
The issuance of the shares of Series E Preferred Stock and shares of Common Stock to Project Nickel LLC was not registered under the Securities Act of 1933, as amended (the “Securities Act”), in reliance upon the exemption from registration provided by Section 3(a)(9) of the Securities Act, as an exchange of securities by an issuer with an existing security holder exclusively where no commission or other remuneration was paid or given directly or indirectly for soliciting such exchange.
As of June 30, 2026, there are potentially dilutive shares of common stock issuable upon the conversion of the Series E Convertible Preferred Stock. These shares were excluded from the computation of diluted net loss per share for the three and six months ended June 30, 2026, as their inclusion would have been anti-dilutive due to the net loss positions recorded in the periods.
Note Payable – Related Party
On August 1, 2023 a former executive loaned the Company $15. During the three months ended June 30, 2026, the Company re-paid this note payable including $1 in interest expense. For the three months ended June 30, 2026 and 2025, respectively, the Company recorded $0.1 and $0.1 of interest expense in respect of this note.
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