v3.25.3
FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE
 9 Months Ended
Sep. 30, 2025
Fair Value Disclosures [Abstract]  
FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE
Financial Instruments Measured at Fair Value and Financial Statement Presentation
The accounting guidance establishes a three-tier hierarchy, which prioritizes the inputs used in the valuation methodologies in measuring fair value as of the measurement date as follows:
Level 1: Fair values are based on unadjusted quoted prices in active trading markets for identical assets and liabilities.
Level 2: Fair values are based on observable quoted prices other than those in Level 1, such as quoted prices for similar assets or liabilities in active markets or quoted prices for identical assets or liabilities in inactive markets.
Level 3: Fair values are based on at least one significant unobservable input for the asset or liability.

The Company’s policy is to recognize transfers between levels of the fair value hierarchy on the date of the event or change in circumstances that caused the transfer. There were no transfers into or out of Level 3 during the nine months ended September 30, 2025, and 2024.

Fair Value Measurements and Financial Statement Presentation

The Company’s financial instruments measured at fair value and their respective levels in the fair value hierarchy as of September 30, 2025, and December 31, 2024, were as follows:
 September 30, 2025December 31, 2024
 Fair Value of AssetsFair Value of Assets
In ThousandsLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Money market funds (1)
$— $— $— $— $1,058 $— $— $1,058 
Total$— $— $— $— $1,058 $— $— $1,058 

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(1) Included in cash and cash equivalents on the accompanying condensed consolidated balance sheets.


September 30, 2025December 31, 2024
Fair Value of LiabilitiesFair Value of Liabilities
In ThousandsLevel 1Level 2Level 3TotalLevel 1Level 2Level 3Total
Common Warrants$— $— $59 $59 $— $— $2,268 $2,268 
Total$— $— $59 $59 $— $— $2,268 $2,268 



The following table summarizes the Common Warrants activity for the nine months ended September 30, 2025:

In ThousandsLevel 3 Fair Value of Liabilities
Balance as of December 31, 2024$2,268 
Issued— 
Reclassified to stockholders' equity(1,742)
Change in fair value(467)
Balance as of September 30, 2025$59 


In January 2025, as a result of the Warrant Amendment Agreement, the Company reclassified the fair value of 1,100,000 2024 Common Warrants of $1.6 million from Class A common stock warrants liability to a component of stockholders’ equity within additional paid-in capital in the accompanying condensed consolidated balance sheets. The change in fair value of the Class A common stock warrants liability related to these 2024 Common Warrants of $0.3 million between December 31, 2024, and January 24, 2025, is reflected in non-operating income, net in the Company’s condensed consolidated statements of operations for the nine months ended September 30, 2025.

Furthermore, as a result of the Company obtaining the requisite approval from its stockholders on May 22, 2025, with respect to those 2024 Common Warrants held by Mr. Riggs, the Company reclassified the fair value of 98,040 2024 Common Warrants of $0.1 million from Class A common stock warrants liability to a component of stockholders’ equity within additional paid-in capital in the accompanying condensed consolidated balance sheets. The change in fair value of the Class A common stock warrants liability related to these 2024 Common Warrants of $0.1 million between March 31, 2025, and May 23, 2025, is reflected in non-operating income, net in the Company’s condensed consolidated statements of operations for the nine months ended September 30, 2025.

The following table summarizes the Common Warrants activity for the nine months ended September 30, 2024:

In ThousandsLevel 3 Fair Value of Liabilities
Balance as of December 31, 2023$1,418 
Issued10,151 
Change in fair value(8,908)
Balance as of September 30, 2024$2,661 


The Company estimates the fair value of the liability classified Common Warrants as of the date of issuance and at the end of every reporting period using a Black-Scholes option pricing model, which requires it to make assumptions regarding future stock price volatility and dividend yield. The Company estimates the risk-free interest rate based on the United States Treasury zero-coupon yield curve for the remaining life of the Common Warrants. Prior to the fourth quarter of 2024, the Company estimated its future stock price volatility using a weighted average historical volatility which took into consideration the Company’s historical volatility and historical volatility from a group of guideline companies, over the remaining life of the Common Warrants. Beginning in the fourth quarter of 2024, the Company began using its own historical stock price volatility, over the remaining life of the Common Warrants. The Company
does not pay dividends and does not expect to pay dividends in the foreseeable future.

The estimated fair values of the Common Warrants, and the assumptions used for the Black-Scholes option pricing model were as follows:
 As of September 30, 2025As of December 31, 2024
Estimated fair value of common warrants per share
$0.01 - $0.57
$0.39 - $1.70
Assumptions: 
Risk-free interest rate
3.6%
4.2% - 4.3%
Expected volatility
102.2% - 116.2%
111.0% - 118.1%
Expected term to liquidation (in years)
1.9 - 3.7
2.6 - 4.5


The estimated fair values of the 2024 Common Warrants on the January 2025 and May 2025 reclassification dates, and the assumptions used for the Black-Scholes option pricing model were as follows:

May 2025 ModificationJanuary 2025 Modifications
Estimated fair value of common warrants per share (1) (2)
$1.55
$1.34 - $1.55
Assumptions:
Risk-free interest rate4.0 %4.4 %
Expected volatility111.9 %111.4 %
Expected term to liquidation (in years)4.14.4

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(1) The May 23, 2025 Modification represents the 98,040 2024 Common Warrants held by Mr. Riggs, which were amended on May 23, 2025. The stock price immediately prior to the May 2025 Modification was $2.72 per share of Class A Common Stock.
(2) For the January 2025 Modifications, the $1.34 fair value per share represents the 550,000 2024 Common Warrants amended on January 22, 2025, and the $1.55 fair value per share represents 550,000 2024 Common Warrants amended on January 24, 2025. The stock price immediately prior to the January 2025 Modifications was $2.31 per share of Class A Common Stock and $2.60 per share of Class A Common Stock, respectively.
As of September 30, 2025, the Company had no other financial instruments measured at fair value.