Annual report [Section 13 and 15(d), not S-K Item 405]

Fair Value Measurements

v3.26.1
Fair Value Measurements
 12 Months Ended
Dec. 31, 2025
Fair Value Disclosures [Abstract]  
Fair Value Measurements Fair Value Measurements
The following table sets forth, by level within the fair value hierarchy, the accounting of the Company’s financial assets and liabilities at fair value on a recurring basis according to the valuation techniques the Company uses to determine their fair value:

 
December 31, 2025
 
Level 1
Level 2
Level 3
(in thousands)
Recurring fair value measurements
 
 
 
Assets:
 
 
 
Money market funds
$
10,531
$
—
$
—
Liabilities:
U.S. Bounti Warrant
$
—
$
—
$
1,166
Cargill Amended Warrants
$
—
$
—
$
10,096
December 31, 2024
Level 1
Level 2
Level 3
(in thousands)
Recurring fair value measurements
Assets:
Money market funds
$
7,448
$
—
$
—
Liabilities:
Cargill Amended Warrants
$
—
$
—
$
6,403
The fair value of the Company's money market funds is determined using quoted market prices in active markets for identical assets.
Cargill Financial Common Stock Purchase Warrant Amendment

In connection with the Eleventh Amendment, the Company entered into amendments for existing warrants held by Cargill Financial (the "Cargill Warrant Amendments") to amend (i) the Common Stock Purchase Warrant, dated March 28, 2023 (the "Cargill Base Warrant") and (ii) the Warrants to Purchase Common Stock, each issued November 21, 2021 (the "Cargill 2021 Warrants" and, together with the Base Warrant, the "Cargill Original Warrants"; the Cargill Original Warrants as amended, the "Cargill Amended Warrants") to (a) amend the exercise price for the Cargill Original Warrants from $6.50 to $4.00 per share of common stock, (b) extend the expiration date to eight years from the closing of the Eleventh Amendment, and (c) amend and restate the Cargill 2021 Warrants to be on the same form as the Cargill Base Warrant. The Cargill Original Warrants were issued by the Company to Cargill Financial to purchase up to an aggregate of 5,408,145 shares of common stock and the aggregate number of shares is the same for the Cargill Amended Warrants. The change in the per share exercise price did not affect the classification of the Cargill Original Warrants. Therefore, the change in fair value of the Cargill Original Warrants will continue to be remeasured each quarter until the instrument is settled or expires with changes in fair value recorded in "Change in fair value of warrant liabilities" in the Consolidated Statements of Operations.
The fair value of the liability of the Cargill Amended Warrants is determined using a Black-Scholes model. The following table presents changes in the Level 3 fair value measurement for the warrant liability on a recurring basis (in thousands):
Balance as of December 31, 2023
$
7,214
Fair value measurement adjustments recognized through change in fair value of warrant liability
(811)
Balance as of December 31, 2024
$
6,403
Fair value measurement adjustments recognized through change in fair value of warrant liability
3,693
Balance as of December 31, 2025
$
10,096
The key inputs into the Black-Scholes model used to determine the fair value of the liability of the Cargill Amended Warrants were as follows at their measurement dates:

December 31,
2025
December 31, 2024
Input
Share price
$
2.14
$
2.07
Risk-free interest rate
3.9%
4.4%
Volatility
119%
122%
Exercise price
$
4.00
$
6.50
Warrant life (years)
7.3
3.2
Dividend yield
—%
—%

U.S. Bounti Warrant

The U.S. Bounti Warrant entitles the holder to purchase up to 550,000 shares of the Company’s common stock at an exercise price of $0.125 per share, subject to adjustment upon the occurrence of certain events such as stock dividends, stock splits, or other corporate actions. The U.S. Bounti Warrant is exercisable beginning on the date of issuance and expires on August 1, 2035. The Company concluded that the U.S. Bounti Warrant should be classified as a derivative liability pursuant to ASC 815, as the instrument fails the indexation and equity classification guidance. As such, the U.S. Bounti Warrant will be initially measured at fair value. The change in fair value will be remeasured each quarter until the instrument is settled or expires with changes in fair value recorded in "Change in fair value of warrant liability" in the Consolidated Statements of Operations.

The fair value of the liability of the U.S. Bounti Warrant is determined using a Black-Scholes model. The following table presents changes in the Level 3 fair value measurement for the warrant liability on a recurring basis (in thousands):

Balance as of August 1, 2025 (initial measurement)
$
1,502
Fair value measurement adjustments recognized through change in fair value of warrant liability
(336)
Balance as of December 31, 2025
$
1,166
The key inputs into the Black-Scholes model used to determine the fair value of the liability of the U.S. Bounti Warrant were as follows at their measurement dates:

December 31,
2025		 August 1, 2025 (initial measurement)
Input
Share price
$
2.14
$
2.73
Risk-free interest rate
4.2%
4.2%
Volatility
119%
123%
Exercise price
0.125
$
0.125
Warrant life (years)
9.6
10.0
Dividend yield
—%
—%

As of December 31, 2025 and 2024, the carrying value of the Company's cash and cash equivalents, restricted cash, accounts receivable, accounts payable and accrued expenses approximated their respective fair values due to their short-term maturities. Therefore, no unrealized gains or losses were recorded during the periods presented. There were no transfers of financial instruments between Level 1, Level 2, and Level 3 during the periods presented.