LONG-TERM DEBT

12 Months Ended

Dec. 31, 2025

LONG-TERM DEBT

LONG-TERM DEBT

5. LONG-TERM DEBT

Loan and Security Agreement

June 28, 2024 Loan:

On June 28, 2024 (the “Closing Date”), the Company entered into a Loan and Security Agreement with Avenue Capital Group (“Loan”). Avenue Capital Group agreed to loan the Company up to an aggregate of $20 million (the “Avenue Capital Commitment”), to be disbursed in two tranches. The first tranche of $15 million (“Tranche 1”) consisted of $10 million, which was available to the Company on the Closing Date and $5 million constituted restricted cash, which was released from its restriction on January 10, 2025, as the following conditions were achieved: (i) the United States Food and Drug Administration (the “FDA”) has accepted the Company’s application for review with respect to its DrugSorb-ATR De Novo 510(k) and (ii) the Company received a minimum of $3 million in net proceeds from the sale of its equity securities after the Closing Date. The restriction was released on a dollar for dollar basis for equity raised between $3 million and $5 million. The second tranche (“Tranche 2”) consisted of $5 million, which would have been

disbursed at the Company’s request between July 1, 2025 and December 31, 2025, if the Company received FDA marketing approval of its DrugSorb-ATR application, which it did not. The proceeds from the Avenue Capital Commitment were used to pay off the existing outstanding debt with Bridge Bank and were additionally used for working capital purposes and to fund general business requirements. Amounts borrowed under the Avenue Capital Commitment bear interest at a variable rate per annum equal to the greater of (A) the Prime Rate plus five percent (5.00%) or (B) thirteen and one-half percent (13.50)%.

As additional consideration for the Commitment, on June 28, 2024, the Company also issued Avenue Capital Group with warrants with a fair value of $0.7 million to purchase an aggregate of 1,645,569 shares of the Company’s common stock for cash at the exercise price of $0.79, which expire on June 28, 2029. The number of warrants is fixed, however, the exercise price may be adjusted down if the Company raises equity (excluding sales of equity utilizing the Company’s at-the-market equity facility) at a share price that is lower than $0.79. These warrants meet the criteria for equity classification under ASC 815.

The loan required interest-only payments for the first 24 months, through July 1, 2026, followed by equal monthly installments of principal plus accrued and unpaid interest until maturity, on July 1, 2027; provided, however, that if the Company had drawn the full amount of Tranche 2 by December 31, 2025, and achieves for the trailing six-month period ended June 30, 2025, at least $25 million of revenue, (the Interest only Milestone as defined in the Loan), the Interest only Period would have been extended by six months to January 1, 2027, followed by equal monthly installments of principal plus accrued and unpaid interest through January 1, 2028.

On October 22, 2024 the Company announced that the FDA had accepted its application of DrugSorb-ATR, which was one of the two conditions required by the restricted cash debt covenant. Proceeds from the Rights Offering on January 10, 2025 satisfied the second condition of the debt covenant which allowed for the $5 million of restricted cash on the Company’s consolidated balance sheets to become unrestricted, and available for use.

The Lenders were also granted the right while the Commitment is outstanding to convert up to an aggregate amount of $2 million of the principal amount of the outstanding Growth Capital Loans into the Company’s common stock at a fixed conversion price of 120% of the Closing Price (as defined in the warrant) or $0.95 per share (the “Conversion Option”).

The obligations under the Loan and Security Agreement are secured by a first priority security interest in favor of the Lenders with respect to the Company’s Shares (as defined in the Loan and Security Agreement) and the Company’s Collateral (as defined in the Loan and Security Agreement), which includes the Company’s intellectual property, pursuant to that certain Intellectual Property Security Agreement, dated as of June 28, 2024, by and between the Company and the Administrative Collateral Agent.

November 13, 2025 Amended Loan and Security Agreement

On November 13, 2025, the Company and Avenue Capital Group entered into the First Amendment to Loan Documents (the “Amended Loan and Security Agreement”), amending the Company’s Loan and Security Agreement, dated June 28, 2024, as supplemented. The Amended Loan and Security Agreement funded an additional aggregate $2.5 million (“Tranche 2a”) from Avenue Capital Group in November 2025 and extended the interest-only period from July 1, 2026 to December 31, 2026, followed by equal monthly installments of principal plus accrued and unpaid interest until maturity on July 1, 2027. The Company will have access to an additional aggregate $2.5 million (“Tranche 2b”) from Avenue Capital Group and receive a further six-month extension of the interest only period to the July 1, 2027 maturity date, subject to FDA approval of DrugSorb-ATR, between January 1, 2026 and December 31, 2026. Tranche 2a and Tranche 2b, in the aggregate, replace Tranche 2 of the Loan. The Amended Loan and Security Agreement requires that the Company maintain revenue and certain operating cash burn targets prior to FDA approval of DrugSorb-ATR.

Upon a prepayment, the Company would incur a fee ranging from 1% to 3% of the outstanding principal, depending on the time of payment in relation to the maturity date.

The Loan and Security Agreement includes customary loan conditions, company representations and warranties, company affirmative covenants and company negative covenants for secured transactions of this type. As of December 31, 2025, the Company was in compliance with these covenants.

The Company evaluated the amendment in accordance with applicable accounting guidance and determined that the amendment should be accounted for as a debt modification. As a result of the debt amendment, there were no write-offs of existing unamortized deferred financing costs. The Company recorded new deferred financing costs of approximately $0.6 million related to the

fair value of warrants issued in connection with the debt amendment. The Company incurred approximately $0.1 million of third-party costs which were recorded as other expenses related to financing.

The Company’s obligations under the Amended Loan and Security Agreement are joint and several (see June 28, 2024 Loan for obligation under original loan agreement).

Under the terms of the Amended Loan and Security Agreement, the Company issued additional warrants to Avenue Capital Group to purchase 1,428,571 shares of the Company’s common stock for cash at the exercise price of $0.70, which expire on November 13, 2030. The number of warrants and exercise price are fixed.

Debt Discounts Related to Avenue Capital Group Agreements

In connection with the long-term debt transactions, the Company recorded the following discounts:

	(amounts, in thousands)
Fair value of warrants issued to Avenue Capital Group - 2024	$	690
Fair value of warrants issued to Avenue Capital Group - 2025		627
Final fee		900
Debt issuance cost		498
Commitment fee paid on the Closing Date (1% of the Avenue Capital Group commitment)		200
Total discounts recorded at inception against Avenue Capital Group Long Term Debt	$	2,915

The Company amortizes debt discounts as interest expense using the interest method through the maturity date. The loan and security agreement included a final payment upon maturity of $0.9 million. The Company accretes the final payment as interest expense using the interest method through the maturity date.

The Company’s obligations under the Amended Loan and Security Agreement are joint and several. The obligations under the Loan and Security Agreement are secured by a first priority security interest in favor of the Lenders with respect to the Company’s Shares (as defined in the Loan and Security Agreement) and the Company’s Collateral (as defined in the Loan and Security Agreement), which includes the Company’s intellectual property, pursuant to that certain Intellectual Property Security Agreement, dated as of June 28, 2024, by and between the Company and the Administrative and Collateral Agent.

Long - term debt as of December 31, 2025, and 2024 consists of the following:

	As of December 31, 2025		As of December 31, 2024
	(amounts in thousands)
Principal amount	$	17,500	15,000
Plus: final payment upon maturity		900	900
Less unamortized debt discount		(1,733)	(1,904)
Subtotal		16,667	13,996
Less current maturities		—	—
Long-term debt net of current maturities	$	16,667	13,996

As of December 31, 2025, principal payments of long-term debt, including the final payment, are due as follows:

	(amounts, in thousands)
2026	$	—
2027		18,400
Total	$	18,400

Bridge Bank

On June 28, 2024, concurrent with the closing of the Avenue Capital Group financing discussed above, the Company paid off its existing outstanding debt with Bridge Bank.

As of December 31, 2025, the following commitments survive after the termination of the Bridge Bank Amended and Restated Loan and Security Agreement and related amendments:

2022 Success Fee Letter

Pursuant to the 2022 Success Fee Letter, the Company will pay to Bridge Bank a success fee equal to (i) 1% of $5 million if the Company draws down the first tranche of the Company’s previously outstanding term loan with the Bank (the “Term C Loan”) and is payable only if the Company’s stock price equals or exceeds $8 for five consecutive trading days; (ii) 1.5% of $5 million if the Company draws down the second tranche of the Term C Loan and is payable only if the Company’s stock price equals or exceeds $10 for five consecutive trading days; and (iii) 2% of $5 million if the Company draws down the third tranche of the Term C Loan and is payable only if the Company’s stock price equals or exceeds $12 for five consecutive trading days (together, the “Success Fee”). The Company may pay the Success Fee in cash or in shares of common stock, at the Company’s sole discretion. The right of Bank to receive the Success Fees and the obligation of the Borrower to pay the Success Fees hereunder shall terminate on the date that is the fifth anniversary of the funding date of the last Term C Loans made but shall survive the termination of the Loan Agreement and any prepayment of the Term C Loans. Prior to repayment of the loan on June 28, 2024, the Company had drawn the first tranche of the loan and would be subject to total success fees of less than $0.1 million if the stock price exceeds $8.00 for five consecutive trading days prior to December 27, 2027. The Company did not draw down the second or third tranche prior to repayment of the loan. The termination date of the 2022 Success Fee Letter is December 27, 2027.