The Company has entered into notes payable agreements with third parties. The tables below summarize these agreements as of December 31, 2024, and 2023, providing details on contractual maturity dates, contractual interest rates, unpaid principal balances, fair value adjustments, original issue discounts, including proceeds allocated to warrants, and net carrying values.


	December 31, 2024
(in thousands)	Contractual Maturity Date	Contractual Interest Rates				Unpaid Principal Balance		Fair Value Measurement Adjustments		Original Issue Discount and Proceeds Allocated to Warrants		Net Carrying Value
Secured SPA Notes	Various	10	%	-	15%	$	3,118	$	2,651	$	(312)	$	5,457
2023 Unsecured SPA Notes	Various dates in 2029	10	%	-	15%	4,380		2,844		(508)		6,716
Junior Secured SPA Notes	September 2029	10%				28,840		13,163		(15,944)		26,059
2024 Unsecured SPA Notes	December 2029	10%				10,015		8,741		(11,724)		7,032
Notes payable – China other	Due on Demand	—%				4,173		—		—		4,173
Auto loans	October 2026	7%				51		—		—		51
						$	50,577	$	27,399	$	(28,488)	$	49,488


Notes payable, current portion												$	4,224
Notes payable, long-term portion												$	45,264


	December 31, 2023
(in thousands)	Contractual Maturity Date	Contractual Interest Rates				Unpaid Principal Balance		Fair Value Measurement Adjustments		Original Issue Discount and Proceeds Allocated to Warrants		Net Carrying Value
Secured SPA Notes	Various	10	%	-	15%	$	100,052	$	(15,501)	$	(10,319)	$	74,232
2023 Unsecured SPA Notes	Various dates in 2029	10	%	-	15%	13,219		1,262		(2,543)		11,938		(1)
Notes payable – China other	Due on Demand	—%				4,898		—		—		4,898
Auto loans	October 2026	7%				82		—		—		82
						$	118,251	$	(14,239)	$	(12,862)	$	91,150

Notes payable, current portion												$	91,150
Notes payable, long-term portion												$	—
_____________________
(1) The 2023 Unsecured SPA Notes line item values above were updated to exclude related party balance of $542 thousand for comparability of the presentation with the current year. (See Note 8, Related Party Transactions.)

The following table presents a roll forward of the Company’s Notes payable balances from December 31, 2023 to December 31, 2024. The table summarizes beginning and ending balances by debt category and details changes during the period, including repayments, conversions, reclassifications, fair value adjustments, and other significant transactions.


	Categories of Debt
(in thousands)	Secured SPA Notes		2023 Unsecured SPA Notes		Unsecured Convertible Notes		Junior Secured SPA Notes		2024 Unsecured SPA Notes		Notes payable – China other		Auto loans		Total
Balance as of December 31, 2023 (a)	$	74,232	$	11,938	$	—	$	—	$	—	$	4,898	$	82	$	91,150
New Issuances (b)	10,701		—		34,885		9,950		1,755				—		57,291

Repayment of Debt (c)	—		—		—		—		—		—		(31)		(31)

Conversion of Debt to Equity (d)	(50,691)		(14,931)		—		(1,056)		—		—		—		(66,678)

Extinguishments of Debt (e)	5,158		(2,394)		(65)		—		—		—		—		2,699
Fair Value Adjustments of Debt (f)	(33,943)		(10,268)		328		9,665		—		—		—		(34,218)

Reclassification of Debt Between Debt Categories (g)	—		22,371		(35,148)		7,500		5,277		—		—		—
Other Adjustments (h)	—		—		—		—		—		(725)		—		(725)
Balance as of December 31, 2024 (i)	$	5,457	$	6,716	$	—	$	26,059	$	7,032	$	4,173	$	51	$	49,488



(a) The carrying value for each note category, fair value or amortized cost depending on the election, as of December 31, 2023.
(b) Debt instruments issued during the period, recorded at fair value upon issuance if the fair value option is elected, or at principal balance net of discounts.

(c) Cash repayments of principal amounts during the period.

(d) Fair value of debt converted into equity during the period.

(e) Adjustments from amendments, modifications, or extinguishment of existing debt, in accordance with ASC 470-50, and presented as a component of 'Loss on settlement of notes payable' in the Consolidated Statements of Operations.
(f) Adjustments to debt fair value due to the fair value option election, embedded derivatives, or anti-dilution provisions. These adjustments are presented as a component of 'Change in fair value of notes payable, warrant liabilities, and call option derivatives' in the Consolidated Statements of Operations.

(g) Transfers of amounts between debt categories, such as from secured to unsecured classifications.
(h) Miscellaneous changes not captured in other columns, such as currency adjustments and reclassification to accrued expenses.
(i) The carrying value for each note category, fair value or amortized cost depending on the election, as of December 31, 2024.

The following table presents a roll forward of the Company’s Notes payable balances from December 31, 2022 to December 31, 2023 with third parties. The table summarizes beginning and ending balances by debt category and details changes during the period, including repayments, conversions, reclassifications, fair value adjustments, and other significant transactions.


	Categories of Debt
(in thousands)	Secured SPA Notes		2023 Unsecured SPA Notes		Notes payable – China other		Auto loans		Total
Balance as of December 31, 2022 (a)	$	26,008	$	—	$	4,997	$	100	$	31,105
New Issuances (b)	173,730		20,936		—		(18)		194,648

Repayment of Debt, including periodic interest on debt carried at fair value (c)	(1,167)		—		—		—		(1,167)

Conversion of Debt to Equity (d)	(114,252)		(9,135)		—		—		(123,387)

Extinguishments of Debt (e)	13,078		—		—		—		13,078
Fair Value Adjustments of Debt (f)	(23,165)		137		—		—		(23,028)


Other Adjustments (g)	—		—		(99)		—		(99)
Balance as of December 31, 2023 (h)	$	74,232	$	11,938	$	4,898	$	82	$	91,150



(a) The carrying value for each note category, fair value or amortized cost depending on the election, as of December 31, 2022.
(b) Debt instruments issued during the period, recorded at fair value upon issuance if the fair value option is elected, or at principal balance net of discounts.

(c) Cash repayments of principal amount and periodic interest, where fair value option is elected, during the period.

(d) Fair value of debt converted into equity during the period.

(e) Adjustments from amendments, modifications, or extinguishment of existing debt, in accordance with ASC 470-50, and presented as a component of Loss on settlement of notes payable in the Consolidated Statements of Operations.
(f) Adjustments to debt fair value due to the fair value option election, embedded derivatives, or anti-dilution provisions. These adjustments are presented as a component of Change in fair value of notes payable, warrant liabilities, and call option derivatives' in the Consolidated Statements of Operations.


(g) Miscellaneous changes not captured in other columns, such as currency adjustments.
(h) The carrying value for each note category, fair value or amortized cost depending on the election, as of December 31, 2023.

The Company has issued various financing arrangements, including secured and unsecured notes, convertible notes, and loans. These are categorized as follows: (i) Secured SPA Notes; (ii) 2023 Unsecured SPA Notes; (iii) Unsecured Convertible Notes; (iv) Junior Secured SPA Notes; (v) 2024 Unsecured SPA Notes; (vi) Collateralized loan; (vii) Notes payable – China other; and (viii) Auto loans.

The Secured SPA Notes were issued under the Secured SPA Agreement dated August 14, 2022, with FF Simplicity Ventures LLC (“FFSV”) acting as administrative agent, collateral agent, and purchaser, along with additional purchasers. These senior secured convertible notes are supported by a second lien on substantially all of the Company’s assets and are guaranteed by the Company’s domestic subsidiaries.

The Secured SPA Notes bear an annual interest rate of 10%, increasing to 15% if interest is paid in shares of Class A Common Stock. Principal and interest are due at maturity, unless converted earlier pursuant to the Secured SPA Notes’ conversion privileges. Issued at a 10% original issue discount, these notes are convertible into Class A Common Stock at the lesser of a fixed conversion price or 90% of the VWAP for the trading day immediately prior to the conversion date. The Secured SPA Notes are subject to full ratchet anti-dilution price protection and as of December 31, 2024 the fixed price conversion price was $1.16. The Secured SPA Notes mature six-years from each date of issuance. The outstanding Secured SPA Notes, as of December 31, 2024, are scheduled to mature on various dates in 2029 and 2030.

In connection with the issuance of the Secured SPA Notes, the Company also granted to each purchaser a warrant (the “Secured SPA Warrants”) to purchase shares of Class A Common Stock equal to 33% of the shares issuable upon conversion of the aggregate principal amount under the Secured SPA Notes funded. The Secured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the Secured SPA Notes. The Secured SPA Warrants are indexed to the Company’s Class A Common Stock and, as such, meet the scope exception in ASC 815-40 to be classified within equity.

The Company elected the fair value option afforded by ASC 825, Financial Instruments, with respect to the Secured SPA Notes because the notes include features, such as a contingently exercisable put option, that meet the definition of an embedded derivative. The Company expenses transaction costs to Change in fair value of notes payable, warrant liabilities, and derivative call options or Change in fair value of related party notes payable and related party warrant liabilities, as applicable, in the Consolidated Statements of Operations and Comprehensive Loss. The Company also elected to apply the fair value option for other SPA Portfolio Notes.

•Sixth Amendment (February 3, 2023): This amendment introduced Tranche C Notes with an aggregate principal of up to $135.0 million at an original base conversion price of $10,080.00, subject to anti-dilution adjustments. Certain outstanding Secured SPA Notes totaling $31.0 million in principal were replaced with notes carrying a conversion price of $8,568.00. The change to the conversion price triggered accounting treatment under ASC 470-50, Debt—Modifications and Extinguishments (“ASC 470-50”) and the Company recognized a Loss on settlement of notes payable because the change in fair value of the conversion feature was substantial.

•Seventh Amendment (March 23, 2023): Accelerated funding timelines for $40.0 million of committed Tranche C Notes and $5.0 million of optional Tranche B Notes. Original issuance discounts for $25.0 million of Tranche C Notes and $5.0 million of Tranche B Notes were increased to 14% and 16%, respectively.

•Eighth Amendment (May 8, 2023): Reduced the floor price for conversion from $2,016.00 to $960.00 and lowered exercise prices for the remaining Secured SPA Notes and related warrants from $10,080.00 to $8,568.00. The change to the conversion price triggered accounting treatment under ASC 470-50, Debt—Modifications and Extinguishments (“ASC 470-50”) and the Company recognized a Loss on settlement of notes payable because the change in fair value of the conversion feature was substantial.

•Unanimous Written Consents: During the six months ended June 30, 2024, the Company’s Board of Directors exercised its authority via a series of written consents (the “Unanimous Written Consents”) to adjust the principal conversion price of the Secured SPA Notes as it considered desirable. The Board chose to reduce the principal conversion price from $29.33 to 105% of the listed market price of the Company’s Common Stock at the close of the trading day on which a conversion notice is delivered. The adjustments to the principal conversion price were temporary in nature and contractually concluded on June 30, 2024. The actions of the Board in the Unanimous Written Consents did not trigger any full ratchet anti-dilution price protection in the Company’s debt and equity securities.

The Waiver Agreement dated August 2, 2024, revised key financial terms of the Secured SPA Notes and 2023 Unsecured SPA Notes, including elimination of the Make-Whole Amount. The Make-Whole Amount was a provision that entitled noteholders to compensation for the interest they would have received had the notes been held to maturity. Additionally, pursuant to the Waiver Agreement, the holders agreed that accrued interest shall be due at maturity or conversion. Further, the conversion price was reduced to the lesser of (1) the conversion price then in effect, $29.33, subject to full ratchet anti-dilution price protection (as adjusted for stock splits, stock dividends, stock combinations, recapitalizations or other similar transactions occurring thereafter) or (2) 90% of the VWAP of the Company’s Common Stock as of the trading day ended immediately prior to the time the conversion notice is delivered to the Company. The provisions of the Waiver Agreement will apply to all Secured SPA Notes and 2023 Unsecured SPA Notes currently issued or issuable in the future pursuant to the Secured SPA Agreement and 2023 Unsecured SPA Agreement.

In accordance with ASC 470-50, Debt—Modifications and Extinguishments, the changes pursuant to the Waiver Agreement qualified as an extinguishment because the change in the fair value of the conversion feature was substantial. Accordingly, the Company recognized a Loss on settlement of notes payable in the Consolidated Statements of Operations and Comprehensive Loss for the year ended December 31, 2024, calculated as the difference between the reacquisition price of the debt and the net carrying amount of the notes.

During the year ended December 31, 2023, the Company entered into multiple dilutive stock sale and purchase transactions, that triggered the full ratchet anti-dilution price protections embedded in the Secured SPA Notes and Secured SPA Warrants. As a result, the fixed-price conversion price of the Secured SPA Notes and exercise price of the Secured SPA Warrants outstanding prior to such financings was reduced to a price equal to the price per share paid in the dilutive financings.

On September 5, 2024, the Company entered into the Junior Secured SPA Agreement, which triggered the full ratchet anti-dilution price protection in the Secured SPA Notes and Secured SPA Warrants. The issuance of the Junior Secured SPA Notes constituted a dilutive issuance, as the stated conversion price of $5.24 was less than the Secured SPA Notes and Secured SPA Warrant exercise price.

On December 21, 2024, the Company entered into the 2024 Unsecured SPA Notes, which triggered the full ratchet anti-dilution price protection in the Secured SPA Notes and Secured SPA Warrant. The issuance of the 2024 Unsecured SPA Notes constituted a dilutive issuance, as the stated conversion price of $1.16 was less than the Secured SPA Notes conversion price and Secured SPA Warrant exercise price.

As of December 31, 2024, the fair value of the Secured SPA Notes was $5.5 million, compared to $74.2 million as of December 31, 2023. During the year ended December 31, 2024, the Company received cash proceeds, net of original issue discounts of $10.7 million in exchange for the issuance of the SPA Notes and incurred approximately $0.2 million in transaction costs. The Company converted debt with a principal amount of $108.8 million into 41,727,089 shares of the Company’s Class A Common Stock. The conversion of Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $126.1 million. For the year ended December 31, 2024, the Company recognized $33.9 million gain from fair value remeasurement of Secured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options and $5.2 million loss on extinguishment triggered by the Waiver Agreement recorded in Loss on settlement of notes payable in the Consolidated Statements of Operations and Comprehensive Loss.

During the year ended December 31, 2023, the Company received cash proceeds, net of original issue discounts of $187.2 million in exchange for the issuance of the SPA Notes and incurred approximately $1.9 million in transaction costs. The Company converted debt with a principal amount of $188.1 million into 419,646 shares of the Company’s Class A Common Stock. The conversion of Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $193.5 million. For the year ended December 31, 2023, the Company recognized $23.2 million gain from fair value remeasurement of Secured SPA Notes under ASC 825, recorded in Change in fair value of notes payable, warrant liabilities, and derivative call options and $13.1 million loss on extinguishment triggered by the Sixth and Eighth Amendments recorded in Loss on settlement of notes payable in the Consolidated Statements of Operations and Comprehensive Loss.

The 2023 Unsecured SPA Notes were issued under the Unsecured SPA Agreement dated May 8, 2023, with various investors including Metaverse Horizon Limited (“MHL”), a related party. These notes are unsecured and have terms similar to the Secured SPA Notes, except they lack collateral backing.

The 2023 Unsecured SPA Notes bear an annual interest rate of 10%, increasing to 15%, if interest is paid in shares of Class A Common Stock. Principal and interest are due at maturity, unless converted earlier pursuant to the 2023 Unsecured SPA Notes’ conversion privileges. Issued at a 10% original issue discount, these notes are convertible into the Company’s Class A Common Stock at a lesser of a fixed conversion price or 90% of the VWAP for the trading day immediately prior to the conversion date. The 2023 Unsecured SPA Notes are subject to full ratchet anti-dilution price protection and as of December 31, 2024 the fixed price conversion price was $1.16. The 2023 Unsecured SPA Notes mature primarily six-years from each date of issuance. The outstanding 2023 Unsecured SPA Notes, as of December 31, 2024, are scheduled to mature on various dates in 2029 and 2030.

In connection with the issuance of the 2023 Unsecured SPA Notes, the Company also granted to each purchaser a warrant (the “2023 Unsecured SPA Warrants”) to purchase shares of Class A Common Stock equal to 33% of the shares issuable upon conversion of the aggregate principal amount under the Secured SPA Notes funded. The 2023 Unsecured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the 2023 Unsecured SPA Notes. The 2023 Unsecured SPA Warrants are indexed to the Company’s Class A Common Stock and, as such, meet the scope exception in ASC 815-40 to be classified within equity.

The Waiver Agreement dated August 2, 2024, revised the terms of the Secured SPA Notes and 2023 Unsecured SPA Notes. The terms of the 2023 Unsecured SPA Notes are substantially similar to those of the Secured SPA Notes and were similarly impacted by the Waiver Agreements. Details of the Waiver Agreements and their effects on the Secured SPA Notes and 2023 Unsecured SPA Notes are discussed in the section on Secured SPA Notes.

During the year ended December 31, 2023, the Company entered into multiple dilutive stock sale and purchase transactions, that triggered the full ratchet anti-dilution price protections embedded in the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrants. As a result, the fixed-price conversion price of the 2023 Unsecured SPA Notes and exercise price of the 2023 Unsecured SPA Warrants outstanding prior to such financings was reduced to a price equal to the price per share paid in the dilutive financings.

On September 5, 2024, the Company entered into the Junior Secured SPA, which triggered the full ratchet anti-dilution price protection in the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrants. The issuance of the Junior Secured SPA Notes constituted a dilutive issuance, as the stated conversion price of $5.24 was less than the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrant exercise price.

On December 21, 2024, the Company entered into the 2024 Unsecured SPA Notes, which triggered the full ratchet anti-dilution price protection in the 2023 Unsecured SPA Notes and 2023 Unsecured SPA Warrant. The issuance of the 2024 Unsecured SPA Notes constituted a dilutive issuance, as the stated conversion price of $1.16 was less than the 2023 Unsecured SPA Notes conversion and Secured SPA Warrant exercise price.

As of December 31, 2024, the fair value of the 2023 Unsecured SPA Notes was $6.7 million, compared to $11.9 million as of December 31, 2023. During the year ended December 31, 2024, the Company did not receive cash proceeds or incur transaction costs, in exchange for the issuance of the 2023 Unsecured SPA Notes. Instead, the Company exchanged Unsecured Convertible Notes with a principal balance of $19.9 million for 2023 Unsecured SPA Notes with a principal of $22.1 million and fair value of $22.4 million. The Company converted debt with a principal amount of $31.0 million into 19,368,059 shares of the Company’s Class A Common Stock. The conversion of 2023 Unsecured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $31.5 million.

During the year ended December 31, 2023, the Company received cash proceeds, net of original issue discounts of $23.3 million in exchange for the issuance of the SPA Notes and incurred approximately $0.2 million in transaction costs. The Company converted debt with a principal amount of $12.5 million into 85,830 shares of the Company’s Class A Common Stock. The conversion of Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $9.2 million. For the year ended December 31, 2023, the Company recognized a net gain of $0.1 million, due to favorable fair value adjustments under ASC 825.

In 2024, the Company issued unsecured convertible note (the “Unsecured Convertible Notes”). These Unsecured Convertible Notes, maturing three months from issuance, accrued interest at 4.27% and were convertible at issuance into Class A Common Stock, 2023 Unsecured SPA Notes, or a future security purchase agreement issued by the Company, which became the 2024 Unsecured SPA Notes. The activity below does not include related parties activity, discussed separately in Note 8, Related Party Transactions.

There were no outstanding Unsecured Convertible Notes as of December 31, 2024, following their conversion into other SPA Portfolio Notes. During the year ended December 31, 2024, the Company issued Unsecured Convertible Notes with a principal value of $34.9 million and exchanged the balance for Unsecured Convertible Notes for 2023 Unsecured SPA Notes, Junior Secured SPA Notes, and 2024 Unsecured SPA Notes.

The Junior Secured SPA Notes were issued under the Junior Secured SPA dated September 5, 2024. These notes are secured by a second-priority lien on certain assets and bear an annual interest rate of 10%. Principal and interest are payable at maturity or at each conversion date. The notes are convertible along with accrued interest into Class A Common Stock at the lesser of (a) a fixed conversion price or (b) the greater of (1) the floor price, $1.05, or (2) the average VWAP of the common stock for the five previous trading days. Junior Secured SPA Notes are subject to full ratchet anti-dilution price protection and as of December 31, 2024 the fixed price conversion price was $1.16. These notes mature in September 2029.

The Junior Secured SPA Investors were given warrants (the “Junior SPA Warrants”) equal to 100% of the shares issuable upon conversion of the aggregate principal amount under the Junior Secured SPA Note funded. The Junior SPA Warrants are exercisable immediately with a term of five years. The Company issued to the placement agent for the transaction a warrant (the “Placement Agent Warrant”) identical to that of the Junior Secured SPA Investors for 202,768 shares of Common Stock, exercisable immediately. These warrants are subject to the same full ratchet anti-dilution price protection as the Junior Secured SPA Notes. The Company’s Junior SPA Warrants meet the requirements for liability classification pursuant to ASC 480-10, Distinguishing Liabilities from Equity. The Junior SPA Warrants could require cash settlement upon events that are considered outside of the control of the Company.

The Junior Secured SPA Investors were issued incremental warrants (the “Incremental Warrants”) to purchase additional Junior Secured SPA Notes up to the amounts originally funded under their original Junior Secured SPA Note commitments. The Incremental Warrants, presented in the Consolidated Balance Sheets as Derivative call options, are exercisable immediately upon issuance and have a one-year term. They allow the purchase of the respective notes at an exercise price equal to the principal amount of the notes issued to the investor, subject to full ratchet anti-dilution price protection, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations, or similar transactions. See Note 14, Fair Value of Financial Instruments for further details on the Incremental Warrants.

On December 21, 2024, the Company entered into the 2024 Unsecured SPA Notes, which triggered the full ratchet anti-dilution price protection in the Junior Secured SPA Notes and Junior Secured SPA Warrants. The issuance of the 2024 Unsecured SPA Notes constituted a dilutive issuance, as the stated conversion price of $1.16 was less than the Junior Secured SPA Notes conversion and Junior Secured SPA Warrant exercise price.

During the year ended December 31, 2024, the Company received cash proceeds, net of original issue discounts of $22.5 million in exchange for the issuance of the SPA Notes and incurred approximately $1.3 million in transaction costs. The Company also exchanged Unsecured Convertible Notes with a principal balance of $7.5 million for Junior Secured SPA Notes with the same principal amount. The Company converted debt with a principal amount $1.1 million into 1,046,651 shares of the Company’s Class A Common Stock. The conversion of Junior Secured SPA Notes into Class A Common Stock resulted in a Loss on extinguishment of $1.4 million.

The 2024 Unsecured SPA Notes were issued under the Unsecured SPA Agreement dated December 21, 2024. These notes bear an annual interest rate of 10%. Principal and interest are payable at maturity or at each conversion date. The notes are convertible along with accrued interest into Class A Common Stock at the lesser of (a) a fixed conversion price, which was $1.16 at issuance, or (b) the greater of (1) the floor price, $1.05, or (2) the lowest one-day VWAP of the common stock for the five previous trading days. 2024 Unsecured SPA Notes are subject to full ratchet anti-dilution price protection. These notes mature in December 2029.

The 2024 Unsecured SPA Investors were given warrants (the “2024 Unsecured SPA Warrants”) equal to 100% of the shares issuable upon conversion of the aggregate principal amount under the 2024 Unsecured SPA Notes funded. The 2024 Unsecured SPA Warrants are exercisable immediately with a term of five years. 2024 Unsecured SPA Warrants are subject to the same full ratchet anti-dilution price protection as the 2024 Unsecured SPA Notes. The Company’s 2024 Unsecured SPA Warrants meet the requirements for liability classification pursuant to ASC 480-10, Distinguishing Liabilities from Equity. The Junior SPA Warrants could require cash settlement upon events that are considered outside of the control of the Company in a manner that is not consistent with the holders of the Company’s Common Stock

The 2024 Unsecured SPA Investors were issued incremental warrants to purchase additional 2024 Unsecured SPA Notes up to the amounts originally funded under their original 2024 Unsecured SPA Note commitments. The Incremental Warrants, presented in the Consolidated Balance Sheets as Derivative call options, are exercisable immediately upon issuance and have a one-year term. They allow the purchase of the respective notes at an exercise price equal to the principal amount of the notes issued to the investor, subject to full ratchet anti-dilution price protection, as adjusted for stock splits, stock dividends, stock combinations, recapitalizations, or similar transactions. See Note 14, Fair Value of Financial Instruments for further details on the Incremental Warrants.

During the year ended December 31, 2024, the Company received cash proceeds, net of original issue discounts of $2.5 million in exchange for the issuance of the SPA Notes and incurred approximately zero in transaction costs. The Company also exchanged Unsecured Convertible Notes with a principal balance of $7.5 million for 2024 Unsecured SPA Notes with the same principal amount.