Note 8. Notes Payable and Convertible Notes Payable

Our notes payable and convertible notes payable as of June 30, 2026 and December 31, 2025 were as follows:

Our interest expense on notes payable and convertible notes payable for the three and six months ended June 30, 2026 and 2025 was as follows:

Maryland Loans

In April 2019, we entered into a term loan agreement (the “2019 Cecil Loan”) with Cecil County, Maryland, for $0.1 million bearing simple interest at an annual rate of 8.00%. The 2019 Cecil Loan matures in full on April 30, 2034, with the repayment amount equal to the greater of (i) principal plus accrued interest or (ii) an amount equal to the fair market value of 1,199 shares of our common stock (the “2019 Cecil Phantom Shares”). As of June 30, 2026 and December 31, 2025, the 2019 Cecil Loan was recorded at principal plus accrued interest as it was greater than the value of the 2019 Cecil Phantom Shares.

In February 2019, we entered into a term loan agreement (the “2019 MD Loan”) with the Department of Housing and Community Development (“DHCD”), a principal department of the State of Maryland, for $0.5 million bearing simple interest at an annual rate of 8.00%. We are subject to covenants until maturity, including limitations on our ability to retire, repurchase, or redeem our stock, options, and warrants other than per the terms of the securities; and limitations on our ability to pay dividends. We are not in violation of any covenants. The 2019 MD Loan matures in full on February 22, 2034, with the repayment amount equal to the greater of (i) principal plus accrued interest or (ii) an amount equal to the fair market value of 5,995 shares of our common stock (the “2019 MD Phantom Shares”). As of  June 30, 2026 and  December 31, 2025, the 2019 MD Loan was recorded at principal plus accrued interest as it was greater than the value of the 2019 MD Phantom Shares.

In May 2022, we entered into a term loan agreement (the “2022 MD Loan”) with DHCD for up to $3.0 million bearing simple interest at an annual rate of 6.00% for the purchase of certain manufacturing equipment (the “Assets”). We drew a total of $1.0 million and our ability to draw the remaining $2.0 million expired in May 2024. The first 12 payments, commencing July 1, 2022, are deferred, followed by 18 monthly installments of interest-only based on the outstanding principal, each up to $15,000 maximum; followed by monthly installments of principal and interest in the amount of $33,306, payable for the lesser of 30 months or until the principal and accrued and unpaid interest is fully repaid, with a balloon payment of all remaining principal and unpaid interest due on the maturity date of July 1, 2027. As of June 30, 2026 and December 31, 2025, the balance of accrued and unpaid interest was $50,000 and $50,000, respectively, and is recorded as part of the carrying amount of the loan. We recorded debt issuance costs of $31,000 as a debt discount.

In December 2022, we entered into a term loan agreement (the “2022 DHCD Loan”) with DHCD for $5.0 million bearing simple interest at an annual rate of 6.00%. The first 12 payments, commencing January 1, 2023, are deferred, followed by 48 monthly installments of interest-only, with a balloon payment of all principal and unpaid interest due on the maturity date of January 1, 2028. As of June 30, 2026 and December 31, 2025, the balance of accrued and unpaid interest was $0.3 million and $0.3 million, respectively, and is recorded as part of the carrying amount of the loan. At any time after December 8, 2023, DHCD may, in its sole discretion, convert up to $5.0 million of principal into our common stock in increments of $1.0 million, at a price equal to the greater of: (i) 97% of the 30-day trailing volume weighted average price (“VWAP”) of our common stock; or (ii) $80.00 per share (the “DHCD Conversion Feature”). The DHCD Conversion Feature did not meet the requirements for derivative accounting. We recorded debt issuance costs of $0.1 million as a debt discount and the effective interest rate is 5.99%.

Senior Secured Convertible Promissory Notes

In December 2024, we entered into a note purchase agreement pursuant to which we sold the 2024 SSCP Notes in a principal amount totaling $10.0 million and bearing interest at an annual rate of 12.00%, which we amended in August 2025 (the “First 2024 SSCPN Amendment”) and in May 2026 (the “Second 2024 SSCPN Amendment”). The 2024 SSCP Notes were sold to related parties, including: (i) Kensington Clene 2024, LLC, an entity controlled by Alison Mosca, an independent director, (ii) 4Life, and (iii) La Scala Investments, LLC. 4Life and La Scala Investments, LLC, are controlled by David Lisonbee, who is also a stockholder and board member of a subsidiary of Clene. In accordance with the 2024 SSCP Note terms, we first used the proceeds to satisfy our obligations under a previous unrelated term loan. Pursuant to the Second 2024 SSCPN Amendment, the maturity date of the 2024 SSCP Notes was extended to the earlier of (i) August 13, 2027 or (ii) upon a change in control transaction. Payments were interest-only for the first 12 months, and, pursuant to the First 2024 SSCPN Amendment, interest is capitalized monthly and added to the balance of the 2024 SSCP Notes beginning in August 2025. Pursuant to the Second 2024 SSCPN Amendment, all principal and accrued interest payments were deferred until the maturity date. We recorded debt issuance costs of $1.5 million as a debt discount at the issuance date and an additional $0.7 million at the date of the First 2024 SSCPN Amendment. As of June 30, 2026 and December 31, 2025, the balance of accrued and unpaid interest was $1.2 million and $0.5 million, respectively, and is recorded as part of the carrying amount of the 2024 SSCP Notes. The First 2024 SSCPN Amendment was accounted for as a troubled debt restructuring under ASC 470, Debt (“ASC 470”), with no restructuring gain required to be recognized as the future cash payments were greater than the carrying amount of the 2024 SSCP Notes. The Second 2024 SSCPN Amendment was accounted for as a debt modification under ASC 470, with a change in fair value of separated derivative instruments (discussed below) of $1.6 million recorded as a loss in earnings.

In August 2025, we entered into a note purchase agreement pursuant to which we sold senior secured convertible promissory notes (the “2025 SSCP Notes,” and together with the 2024 SSCP Notes, the “SSCP Notes”) in a principal amount totaling $1.5 million and bearing interest at an annual rate of 12.00%, which we amended in May 2026 (the “First 2025 SSCPN Amendment”). Interest is capitalized monthly and added to the balance of the 2025 SSCP Notes. Pursuant to the First 2025 SSCPN Amendment, (i) the maturity date of the 2025 SSCP Notes was extended to the earlier of (A) August 13, 2027 or (B) upon a change in control transaction, and (ii) monthly payments totaling $150,000 per month, which were scheduled to commence in September 2026, were deferred until the maturity date. We recorded debt issuance costs of $0.2 million as a debt discount. As of June 30, 2026 and December 31, 2025, the balance of accrued and unpaid interest was $0.2 million and $0.1 million, respectively, and is recorded as part of the carrying amount of the notes. The First 2025 SSCPN Amendment was accounted for as a debt modification under ASC 470, with a change in fair value of separated derivative instruments (discussed below) of $0.2 million recorded as a loss in earnings.

We are subject to covenants until maturity, including a requirement to maintain unrestricted cash and cash equivalents of at least $2.0 million pursuant to the 2024 SSCP Notes. We are not in violation of any covenants. If certain events of default occur and are continuing, the holders of a majority of the outstanding principal balance may accelerate all obligations under the SSCP Notes, plus a penalty equal to 10% of all outstanding principal and accrued and unpaid interest (the “SSCPN Default Feature”). The SSCP Notes are collateralized by substantially all our tangible and intangible property and rights (the “Collateral”). During the continuance of an event of default, if the Collateral is sold or otherwise disposed of and the proceeds thereof are insufficient to satisfy our obligations under the SSCP Notes, we shall be liable for any deficiency, together with additional interest thereon at the rate of 10% per annum (the “SSCPN Collateral Deficiency Fee”). We account for the SSCPN Collateral Deficiency Fee as a contingent liability (see Note 9).

The holders of SSCP Notes may, in their sole discretion, convert up to (i) 65% of the outstanding balance of principal and accrued interest of the 2024 SSCP Notes into the number of shares of our common stock equal to the amount to be converted divided by (A) $5.668 for principal or (B) $4.44 for accrued interest, and (ii) 65% of the outstanding principal balance of the 2025 SSCP Notes into the number of shares of our common stock equal to the amount to be converted divided by $4.44 (the “SSCPN Conversion Feature”). Notwithstanding, in the event a holder declines to convert its pro rata share, the remaining holders may convert additional amounts, provided that no aggregate converted amount exceeds (i) 65% of the outstanding balance of principal and accrued interest for the 2024 SSCP Notes or (ii) $975,000 for the 2025 SSCP Notes. In the event of a change in control or any bankruptcy, liquidation, or other restructuring process, the holders may, at their option, (i) convert up to 65% of outstanding balance of principal and accrued interest for the 2024 SSCP Notes and up to 65% of the outstanding principal for the 2025 SSCP Notes into our common stock, (ii) receive a cash payment equal to 115% of the outstanding balance of principal and accrued interest for the 2024 SSCP Notes and 115% of the outstanding principal for the 2025 SSCP Notes, or (iii) any combination thereof, prior to such monetization event, before any security or claim junior to the SSCP Notes shall receive any proceeds from such monetization event (the “SSCPN Redemption Feature,” collectively with the SSCPN Conversion Feature and SSCPN Default Feature, the “SSCPN Derivative Liabilities”). The SSCPN Derivative Liabilities met the requirements to be separated as derivative instruments and measured at fair value (see Note 12). The issuance date fair value of the SSCPN Derivative Liabilities was (i) $1.4 million for the 2024 SSCP Notes and (ii) $0.2 million for the 2025 SSCP Notes and was recorded as a debt discount. The effective interest rates of the 2024 SSCP Notes and 2025 SSCP Notes are 18.08% and 18.78%, respectively.

We are required to file and maintain an effective registration statement covering the resale of the shares underlying the SSCPN Conversion Feature or we shall pay the holders a penalty equal to 2% of the face value of the 2024 SSCP Notes or 2025 SSCP Notes, as applicable, upon the occurrence of any such failure and for each 30-day period during which such failure is continuing (the “SSCPN Registration Fee”). The aggregate penalty will in no event exceed 10% of the face value of the 2024 SSCP Notes or the 2025 SSCP Notes, as applicable. We account for the SSCPN Registration Fee as a registration payment arrangement to be evaluated as a contingent liability (see Note 9).

Debt Maturities

Future debt payments, net of unamortized discounts and debt issuance costs, without giving effect to any potential future exercise of equity conversion features, are as follows: