Long-Term Debt

9 Months Ended

Sep. 30, 2025

Long-term debt

The following table summarizes our borrowings (in millions):


	September 30, 2025		December 31, 2024
Long-term debt, non-current (Contractual maturity 2029)	$	100	$	50
Unamortized discounts, issuance costs and payment-in-kind interest, net	(2)		(2)
Total long-term debt	$	98	$	48

On August 27, 2024, we and Hercules Capital, Inc. ("Hercules") entered into a loan and security agreement (the "Hercules Agreement"), under which Hercules agreed to lend us up to $250 million in term loans in various tranches subject to minimum draw requirements for each tranche. Under the terms of this agreement, $50 million was drawn at closing and $50 million was drawn in the second quarter 2025, with an additional $50 million committed and fully available at our sole option in minimum increments of $25 million. A second tranche of $100 million will be available subject to future approval by Hercules.

The term loans have an interest only period for the first 48 months from the agreement date and bear cash interest at a rate equal to the greater of (i) 10.45% or (ii) the prime rate plus 1.95%. The agreement allows us to defer up to 2.0% of the cash interest as payment-in-kind interest which is added to the principal at a 1.10 multiple and effective July 1, 2025, we have elected the maximum payment-in-kind deferral.

The aggregate future minimum payments due under the Hercules Agreement, including principal payments, payment-in-kind interest incurred to date, and the end of term charge, are as follows (in millions):


Maturity Date	Amount
2028	$	30
2029	78
Total payments	$	108

During the three and nine months ended September 30, 2025, we recognized $4 million and $7 million of interest expense, respectively. During the three and nine months ended September 30, 2024, we recognized $1 million of interest expense. The effective interest rate of the debt, including payment-in-kind interest, amortization of the debt discount, and issuance costs, was 13.08% commencing with the quarter ended September 30, 2025 compared to 13.39% for the quarters ended March 31, 2025 and prior.