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Item 8. Financial Statements and Supplementary Data

2026-03-20 compared with 2025-03-20 · 277 added, 318 removed, 850 unchanged (41% of the section changed)

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Consolidated Balance Sheets

Consolidated Statements of Income

Consolidated Statements of Operations

Consolidated Statements of Stockholders’ Equity

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Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of SWK Holdings Corporation and its subsidiaries (the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of income, stockholders’ equity, and cash flows, for each of the two years in the period ended December 31, 2024, and the related notes (collectively referred to as the “consolidated financial statements”).

We have audited the accompanying consolidated balance sheets of SWK Holdings Corporation and its subsidiaries (the “Company”) as of December 31, 2025 and 2024, and the related consolidated statements of operations, stockholders’ equity, and cash flows, for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the consolidated financial position of the Company as of December 31, 2025 and 2024, and the consolidated results of its operations and its cash flows for each of the two years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

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The critical audit matter communicated below is a matter arising from the current period audit of the consolidated financial statements that was communicated or required to be communicated to the audit committee and that:

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments.

(1) relates to accounts or disclosures that are material to the consolidated financial statements and (2) involved especially challenging, subjective, or complex judgments.

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing separate opinions on the critical audit matter or on the accounts or disclosures to which it relates.

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The Company generated $38.4 million of finance receivable interest income, including fees, for the year ended December 31, 2025.

As explained in Note 1 to the consolidated financial statements, the Company’s finance receivables are stated at amortized cost, net of unamortized origination fees, if any, and allowance for credit losses.

Interest income on the finance receivables is recorded on an accrual basis based using the effective interest rate method to the extent that the Company expects to collect such amounts.

Interest income on the finance receivables is recorded on an accrual basis, using the effective interest rate method to the extent that the Company expects to collect such amounts.

The Company evaluates the collectibility of both interest and principal for each finance receivable to determine whether it is impaired.

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If actual cash flows were to be substantially lower than estimated, there could be a significant adverse impact on the carrying value of the Company’s finance receivables, related finance receivable interest income, and the Company’s results of operations.

The principal considerations for our determination that performing procedures relating to valuation of the finance receivables and related finance receivable interest income is a critical audit matter is the overall impact on the consolidated financial statements, including the realization of the Company’s deferred tax assets, and the significant amount of judgement by management in developing the assumptions of the expected future cash flows which, in turn, led to significant auditor judgement, subjectivity, and effort in performing audit procedures and evaluating audit evidence relating to the expected future cash flows.

The principal considerations for our determination that performing procedures relating to valuation of the finance receivables and related finance receivable interest income is a critical audit matter include the overall impact on the consolidated financial statements and the significant judgment by management in developing assumptions related to expected future cash flows, and the intent and ability to continue to hold the finance receivables for investment.

As a result, significant auditor judgment, subjectivity, and effort were required in performing audit procedures and evaluating audit evidence related to these assumptions.

Additionally, for certain finance receivables, there may be limited historical data with which to evaluate the expected future cash flows.

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(ii) testing the completeness and accuracy of the underlying data used in the estimate;

and (iii) evaluating management’s assumptions used to estimate future cash flows.

(iii) evaluating management’s assumptions used to estimate future cash flows, and (iv) evaluating management’s intent and ability to continue to hold the finance receivables for investment.

Evaluating management’s assumptions used to estimate future cash flows for reasonableness involved (i) considering historical cash flows from the Company’s finance receivable portfolio;

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(In thousands, except share data)

Year Ended December 31,

As of December 31,

Current assets:

Cash and cash equivalents $ 42,763 $ 5,927

Restricted cash — 733

Interest, accounts receivable, and other receivables, net 5,788 4,729

Interest, accounts receivable, and other receivables 3,860 5,788

Assets held for sale, net (Note 6)

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Total current assets 46,786 20,254

Finance receivables, net of allowance for credit losses of $ 11,249 and $ 13,901 as of December 31, 2024 and December 31, 2023, respectively

Finance receivables, net of allowance for credit losses of $ 7,278 and $ 11,249 as of December 31, 2025 and 2024, respectively

218,627 277,760

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Warrant assets 5,913 4,366

Intangible assets, net — 6,487

Property and equipment, net 48 5,438

Other non-current assets 2,993 3,109

Other non-current assets, net — 3,041

Total assets $ 272,422 $ 332,235

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Accounts payable and accrued liabilities $ 4,974 $ 2,810

Liabilities held for sale (Note 7)

Liabilities held for sale, net (Note 6)

Deferred income — 1,500

Total current liabilities 4,974 5,565

Contingent consideration payable — 4,900

Unsecured senior notes, net 32,110 31,412

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250,000,000 shares authorized;

12,213,599 and 12,497,770 shares issued and outstanding as of December 31, 2024 and December 31, 2023, respectively

12,095,979 and 12,213,599 shares issued and outstanding as of December 31, 2025 and 2024, respectively

Additional paid-in capital 4,418,010 4,419,991

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S WK HOLDINGS CORPORATION

CONSOLIDATED STATEMENTS OF INCOME

CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share data)

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Costs and expenses:

Provision for credit losses 12,756 1,912

Loss on impairment of intangible assets 5,771 —

Impairment of goodwill — 8,404

Provision for (benefit from) credit losses ( 924 ) 12,756

Loss on impairment 641 5,771

Loss on disposal of inventory 314 —

Interest expense 4,797 4,685

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Other income (expense), net

Unrealized net gain (loss) on warrants 2,406 ( 55 )

Net gain (loss) on exercise and cancellation of warrants 445 ( 799 )

Unrealized net gain on warrants 775 2,406

Net gain on exercise and cancellation of warrants — 445

Loss on sale of assets ( 82 ) —

Gain on sale of business 1,601 —

Net loss on marketable investments ( 384 ) ( 266 )

Realized gain on early payment of finance receivable 1,065 —

Gain on revaluation of finance receivable 2,495 —

Realized and unrealized foreign currency transaction gains 641 817

Income before income tax expense (benefit) 18,372 14,613

Income tax expense (benefit) 4,884 ( 1,274 )

Net income $ 13,488 $ 15,887

Net income per share

Realized gain on early payment of finance receivables 1,729 1,065

Gain (loss) on revaluation of finance receivables ( 3,727 ) 2,495

Realized and unrealized foreign currency transaction gains (losses) ( 71 ) 641

Income before income tax expense 20,116 18,372

Income tax expense 22,649 4,884

Net income (loss) $ ( 2,533 ) $ 13,488

Net income (loss) per share

Basic $ ( 0.21 ) $ 1.09

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Issuance of restricted common stock 73,364 — — — —

Effect of adoption of ASU 2016-13 — — — ( 9,683 ) ( 9,683 )

Forfeiture of unvested restricted stock ( 6,446 ) — — — —

Net settlement for employee taxes on stock options — — ( 43 ) — ( 43 )

Stock options exercised, net 2,595 — — — —

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Stock-based compensation — — 1,175 — 1,175

Forfeiture of unvested restricted stock ( 6,446 ) — — — —

Issuance of restricted common stock 72,834 — — — —

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Net settlement for employee taxes on stock options — — ( 89 ) — ( 89 )

Cash dividends ($ 4.00 per share)

— — — ( 49,078 ) ( 49,078 )

Stock options exercised, net 8,764 — — — —

Net income — — — 13,488 13,488

Net loss — — — ( 2,533 ) ( 2,533 )

Balances at December 31, 2025

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Cash flows from operating activities:

Net income $ 13,488 $ 15,887

Adjustments to reconcile net income to net cash provided by operating activities:

Provision for credit losses 12,756 1,912

Impairment of goodwill — 8,404

Loss on impairment of intangible assets 5,771 —

Right-of-use amortization and cease use costs 415 333

Net income (loss) $ ( 2,533 ) $ 13,488

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

Provision for (benefit from) credit losses ( 695 ) 12,756

Loss on sale of assets 82 —

Loss on impairment 641 5,771

Right-of-use amortization 143 415

Amortization of debt issuance costs 1,351 1,054

Deferred income taxes, net 22,573 4,807

Unrealized net (gain) loss on warrants ( 2,406 ) 55

Net (gain) loss on exercise and cancellation of warrants ( 445 ) 799

Net loss on marketable investments 266 —

Unrealized net gain on warrants ( 775 ) ( 2,406 )

Loss on disposal of inventory 314 —

Net gain on exercise and cancellation of warrants — ( 445 )

Gain on sale of business ( 1,476 ) —

Change in fair value of acquisition-related contingent consideration — ( 4,900 )

Gain on revaluation of finance receivable ( 2,495 ) —

Foreign currency transaction gain ( 1,414 ) ( 1,876 )

Loss (gain) on revaluation of finance receivables 3,727 ( 2,495 )

Foreign currency transaction gains ( 681 ) ( 1,414 )

Loss on marketable investments 384 266

Loan discount amortization and fee accretion ( 2,225 ) ( 3,918 )

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Changes in operating assets and liabilities:

Interest, accounts receivable and other receivables, net ( 1,059 ) ( 1,635 )

Interest, accounts receivable and other receivables 1,929 ( 1,059 )

Derivative assets and liabilities, net 915 1,229

Other assets 199 ( 787 )

Collateral on foreign currency forward contract 2,750 —

Other assets, net 1,343 199

Accounts payable, accrued expenses, and other non-current liabilities 1,589 ( 1,326 )

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Net cash provided by operating activities 27,286 23,049

Year Ended December 31,

Cash flows from investing activities:

Sale of finance receivables — 13,942

Proceeds from sale of property and equipment 110 —

Settlement of foreign currency forward contract 1,560 —

Proceeds from sale of assets and liabilities held for sale 6,790 —

Sale of marketable investments — 574

Investment in finance receivables ( 28,500 ) ( 63,706 )

Proceeds from sale of finance receivables 31,678 —

Repayment of finance receivables 56,911 53,109

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Purchases of property and equipment ( 512 ) ( 138 )

Net cash used in investing activities ( 10,134 ) ( 48,948 )

Net cash provided by (used in) investing activities 68,058 ( 10,134 )

Cash flows from financing activities:

Net settlement for employee taxes on stock options ( 89 ) ( 43 )

Net (payments on) proceeds from credit facility ( 6,117 ) 9,905

Payments for financing costs ( 50 ) ( 3,407 )

Proceeds from senior unsecured notes — 32,969

Net payments on from credit facility ( 6,233 ) ( 6,117 )

Cash dividends ( 49,078 ) —

Payments on financing costs ( 41 ) ( 50 )

Repurchases of common stock, including fees and expenses ( 3,067 ) ( 6,014 )

Net cash (used in) provided by financing activities ( 12,224 ) 33,140

Net increase (decrease) in cash, cash equivalents, and restricted cash 691 ( 920 )

Cash, cash equivalents, and restricted cash at beginning of period 5,236 6,156

Cash, cash equivalents, and restricted cash at end of period 5,927 5,236

Net cash used in financing activities ( 58,508 ) ( 12,224 )

Net increase in cash and cash equivalents 36,836 691

Cash and cash equivalents at beginning of period 5,927 5,236

Cash and cash equivalents at end of period 42,763 5,927

Supplemental non-cash investing and financing activities:

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Nature of Operations

SWK Holdings Corporation (the “Company,” “we,” or “us”) was incorporated in July 1996 in California and reincorporated in Delaware in September 1999.

In July 2012, we commenced a strategy of building a specialty finance and asset management business.

In August 2019, we commenced a complementary strategy of building a pharmaceutical development, manufacturing and intellectual property licensing business.

Our operations comprise two reportable segments:

“Finance Receivables” and “Pharmaceutical Development.” We evaluate and invest in a broad range of healthcare related companies and products with innovative intellectual property, including the biotechnology, medical device, medical diagnostics and related tools, animal health and pharmaceutical industries (collectively, “life sciences”).

We allocate capital to each segment in order to generate income through the sales of life science products by third parties and related earned income sources.

The Company is headquartered in Dallas, Texas, and as of December 31, 2024, the Company had 24 full-time employees.

The Company has net operating loss carryforwards (“NOLs”) and believes that the ability to utilize these NOLs is an important and substantial asset.

October 9, 2025, SWK Holdings Corporation (the “Company,” “we,” or “us”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Runway Growth Finance Corp., a Maryland corporation (“Runway Growth Finance”), RWAY Portfolio Holding Corp., a Delaware corporation and a direct wholly owned subsidiary of Runway Growth Finance (“Intermediary Sub”), RWAY Portfolio Corp., a Delaware corporation and a direct wholly owned subsidiary of Intermediary Sub, and Runway Growth Capital LLC, a Delaware limited liability company (collectively “Runway”).

Pursuant to the Merger Agreement, and subject to its terms and conditions, the Company will merge with and into Runway through a series of mergers (the “Merger”).

The closing of the Merger remains subject to certain other customary closing conditions, including the adoption of the Merger Agreement by the Company’s stockholders.

Completion of the Merger is expected to occur in the first half of 2026.

Prior to entering into the Merger Agreement, we operated as a specialty finance and asset management business focused on the life sciences sector.

We evaluated and invested in a broad range of healthcare-related companies and products with innovative intellectual property, including the biotechnology, medical device, medical diagnostics and related tools, animal health and pharmaceutical industries.

We allocated capital within our finance receivables portfolio to generate income derived from third-party sales of life science products and related earned-income sources.

Following completion of the Merger, the Company will cease operating as an independent specialty finance and asset management platform.

The Company was originally incorporated in California in July 1996 and reincorporated in Delaware in September 1999.

The Company is headquartered in Dallas, Texas, and had 9 full-time employees.

as of December 31, 2025.

As of March 7, 2026, the Company and its partners have executed transactions with 58 different parties under its specialty finance strategy, funding an aggregate of $ 876.1 million in various financial products across the life science sector.

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During 2019, we commenced our Pharmaceutical Development segment with the acquisition of Enteris BioPharma, Inc.

Enteris is a clinical development and manufacturing organization providing development services to pharmaceutical partners.

We seek to generate income by providing customers pharmaceutical development, formulation and manufacturing services.

With an effective date of April 21, 2023, we entered into a collaboration agreement with a strategic partner under which we would be the exclusive provider of certain contract development and manufacturing organization ("CDMO") services to its customers.

Fee revenue generated as a result of this agreement is presented as pharmaceutical development revenue on the consolidated statement of income and is accounted for in accordance with our revenue recognition policy as described under Revenue Recognition below.

With an effective date of January 1, 2024, we entered into an Option and Asset Purchase Agreement with a strategic partner on March 14, 2024, which granted the strategic partner an exclusive option to acquire certain of Enteris’ assets related to its business of providing good manufacturing practice (GMP) manufacturing and clinical supply services through Phase 1 and 2 to third parties, subject to certain exclusions.

The strategic partner must exercise the option by or before January 1, 2026.

As of December 31, 2024, Enteris is classified as held for sale as the option is expected to be exercised within the next 12-months - see Note 7 for further details.

As of March 13, 2025 the Company changed the name of Enteris to MOD3 Pharma ("MOD3").

MOD3 is a clinical development and manufacturing organization providing development services to pharmaceutical partners.

MOD3 seeks to generate income by providing customers pharmaceutical development, formulation and manufacturing services.

During the three months ended September 30, 2025, the Company sold MOD3, which was considered a disposition of a business but did not represent a strategic shift for the Company.

Basis of Presentation and Principles of Consolidation

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Segment Information

The Company earns revenues from its two U.S.-based business segments:

For the years ended December 31, 2025 and 2024, the Company earned revenues from its two U.S.-based business segments:

its specialty finance and asset management business offering customized financing solutions to a broad range of life-sciences companies, and its business offering clinical development and manufacturing services to pharmaceutical partners.

Following the sale of substantially all assets of the Pharmaceutical Development Segment in the third quarter of 2025, the Finance Receivables segment became the Company’s primary operating segment.

Intangible Assets

Finite-lived intangible assets are amortized over their estimated useful life, which is the period over which the assets are expected to contribute directly or indirectly to the future cash flows of the Company.

Goodwill and indefinite-lived intangible assets are not amortized, but instead, are subject to annual impairment testing.

We review goodwill and indefinite-lived intangible assets for impairment annually during the fourth quarter and continually assess whether a triggering event has occurred to determine whether the carrying value exceeds the implied fair value.

For the year ended December 31, 2024, the Company identified indicators of impairment for identifiable finite-lived intangible assets due to the lowering of financial expectations for the License Agreement with Cara, and concluded an impairment was required.

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Depreciation is recorded over the estimated useful lives of the assets involved using the straight-line method.

Leasehold improvements and capitalized lease assets are amortized to depreciation expense over the estimated useful life of the asset or the respective lease term used in determining lease classification, whichever is shorter.

Leasehold improvements and capitalized lease assets are amortized over the estimated useful life of the asset or the respective lease term used in determining lease classification, whichever is shorter.

The range of estimated useful lives is as follows:

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Research and development expenses include the costs associated with internal research and development and research and development conducted for the Company by third parties.

These costs primarily consist of salaries, pre-clinical and clinical trials,

outside consultants, and supplies.

These costs primarily consist of salaries, pre-clinical and clinical trials, outside consultants, and supplies.

All research and development costs discussed above are expensed as incurred.

Third-party expenses reimbursed under research and development contracts, which are not refundable, are recorded as a reduction to pharmaceutical manufacturing research and development expense in the consolidated statements of income.

Finance Receivables

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• it is unlikely that significant changes to the plan will be made or that the plan will be withdrawn.

The Company measure a long-lived asset or disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell and recognize any loss in the period in which the held for sale criteria are met.

The Company measures a long-lived asset or disposal group that is classified as held for sale at the lower of its carrying value or fair value less any costs to sell (“FVLCTS”) and recognizes any loss in the period in which the held for sale criteria are met.

Gains, if any, are not recognized until the date of sale.

We cease depreciation and amortization of a long-lived asset, or assets within a disposal group, upon their designation as held for sale and subsequently assess fair value less any costs to sell at each reporting period until the asset or disposal group is no longer classified as held for sale.

We cease depreciation and amortization of a long-lived asset, or assets within a disposal group, upon their designation as held for sale and subsequently assess FVLCTS of the long-lived assets at each reporting period until the asset or disposal group is no longer classified as held for sale.

On October 9, 2025, upon execution of the Merger Agreement, management concluded that all held‑for‑sale criteria were met.

Accordingly, the Company designated the SWK disposal group as held for sale as of that date.

Although the disposal group met the held‑for‑sale criteria under ASC Subtopic 360-10, Property, Plant, and Equipment-Overall-10, the Company does not present the assets and liabilities of the disposal group as separate “assets held for sale” and “liabilities held for sale” on the consolidated balance sheet.

Because the Merger involves the disposition of substantially all of the Company’s net assets, separate classification would not provide meaningful information.

The Company continues to present all assets and liabilities within their existing line items.

Additional information regarding the disposition is provided in Note 6.

Discontinued Operations

Under ASC Subtopic 205‑20, Presentation of Financial Statements-Discontinued Operations, a disposal group is classified as a discontinued operation when all of the following criteria in ASC 205‑20 are met:

(1) the disposal group represents a component of an entity whose operations and cash flows can be clearly distinguished, both operationally and for financial reporting purposes, from the rest of the Company;

(2) the component meets the held‑for‑sale criteria described above;

and (3) the disposal represents a strategic shift that has, or will have, a major effect on the Company’s operations and financial results.

Although the Merger represents a strategic shift, the disposal group does not meet the definition of a component of an entity because the operations being disposed of were not clearly distinguishable from the rest of the Company.

Therefore, the disposal does not qualify for discontinued operations presentation, and all related revenues, expenses, gains, and losses remain included within income from continuing operations for all periods presented.

Provision for Credit Losses

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The allowance for credit losses is determined based on specific allowances for loans that are impaired, based upon the value of underlying collateral or projected cash flows.

Changes to the allowance for credit losses are recorded in the provision for loan credit losses in the consolidated statements of income.

The Company adopted Accounting Standards Update 2016-13, Financial Instruments - Credit Losses:

Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”), as amended, on January 1, 2023 using the modified retrospective approach method.

See Note 4 for further information.

Changes to the allowance for credit losses are recorded in the provision for loan credit losses in the consolidated statements of operations.

Marketable Investments

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Equity securities that have a readily determinable fair value are stated at fair value.

The Company records changes in fair value of its equity securities in other income (expense), net in its consolidated statement of income.

The Company records changes in fair value of its equity securities in other income (expense), net in its consolidated statement of operations.

Foreign Currency Transactions

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Monetary assets and liabilities and transactions denominated in currencies other than an entity’s functional currency are remeasured into its functional currency using current exchange rates, whereas nonmonetary assets and liabilities are remeasured using historical exchange rates.

The Company recognizes gains and losses from such remeasurements within other income (expense), net in the consolidated statements of income in the period of occurrence.

The Company recognizes gains and losses from such remeasurements within other income (expense), net in the consolidated statements of operations in the period of occurrence.

Other Receivables

As of December 31, 2024 and 2023, the Company had collateral receivable of $ 2.8 million with the counterparties on its foreign currency exchange contract and is recorded as collateral on foreign currency forward contract in the consolidated balance sheets.

As of December 31, 2024, the Company had collateral receivable of $ 2.8 million with the counterparties on its foreign currency exchange contract and is recorded as collateral on foreign currency forward contract in the consolidated balance sheet.

All derivatives held by the Company are recognized in the consolidated balance sheets at fair value.

Changes in fair value for derivatives that do not meet the criteria for hedge accounting, or for which the Company has not elected hedge accounting are recorded in the consolidated statements of income.

If a derivative is recorded using hedge accounting, then depending on its nature, changes in its fair value will be either offset against change in the fair value of hedged assets or liabilities through the consolidated statements of income or recorded in other comprehensive income.

The Company had no derivatives designated as hedges as of December 31, 2025 and 2024.

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The Company maintains its cash deposits with well-known and stable financial institutions but balances may exceed stated federally insured limits.

Restricted Cash

Restricted cash as of December 31, 2023 is composed of a holdback amount associated with one of the Company's finance receivables.

Interest and Accounts Receivable

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Accounts are written-off only when all methods of recovery have been exhausted.

As of December 31, 2024 and 2023, the provision for credit losses on interest and accounts receivable was zero.

Certain Risks and Concentrations

As of December 31, 2025 and 2024, there was no allowance for credit losses on interest and accounts receivable.

Risks and Concentrations

Financial instruments that potentially subject the Company to significant concentrations of credit risk consist primarily of cash and cash equivalents, interest and accounts receivable, finance receivables and marketable investments.

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Finance Receivables Segment

For the year ended December 31, 2025, the Company had three customers that accounted for 33.9 % of revenues.

For the year ended December 31, 2024, the Company had one customer that accounted for 11.6 % of revenues.

For the year ended December 31, 2023, the Company had two customers that accounted for 24.1 % of revenues.

The Company performs ongoing credit evaluations of its partner companies and generally requires collateral.

For the year ended December 31, 2024, two of our business partners accounted for 36.6 % of our interest and accounts receivable.

For the year ended December 31, 2023, three of our business partners accounted for 35.0 % of our interest and accounts receivable.

As of December 31, 2025, four of our business partners accounted for 48.3 % of our interest and accounts receivable.

As of December 31, 2024, two of our business partners accounted for 36.6 % of our interest and accounts receivable.

Pharmaceutical Development Segment

For the year ended December 31, 2024, the Company had one customer that accounted for approximately 96.0 % of pharmaceutical development revenues.

For the year ended December 31, 2023, the Company had two customers that accounted for approximately 99.8 % of pharmaceutical development revenues.

The Company does not expect its current or future credit risk exposures to have a significant impact on its operations.

For the year ended December 31, 2025 and 2024, the Company had one customer that accounted for approximately 97.5 % and 96.0 % of pharmaceutical development revenues, respectively.

Given the sale of substantially all of the segment assets, the Company does not expect its current or future credit risk exposures to have a significant impact on its operations.

However, there can be no assurance that its business will not experience any adverse impact from credit risk in the future.

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Fair Value of Financial Instruments

The recorded values of cash and restricted cash, accounts and finance receivables, accounts payable, and accrued expenses approximate the fair values due to the short-term nature of the instruments.

The recorded values of our foreign currency forwards are fair value based on observable inputs other than quoted prices.

The recorded values of cash and cash equivalents, interest and accounts receivables, accounts payable, and accrued expenses approximate the fair values due to the short-term nature of the instruments.

Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.

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If the Company ultimately determines that the payment of such a liability is not necessary, then the Company reverses the liability and recognizes a tax benefit during the period in which the determination is made that the liability is no longer necessary.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax benefit in the statements of income.

Comprehensive Income

The consolidated statements of comprehensive income have been omitted, as net income equals comprehensive income for the years ended December 31, 2024 and 2023.

The Company recognizes accrued interest and penalties related to unrecognized tax benefits as a component of income tax benefit in the statements of operations.

Comprehensive Income (Loss)

The consolidated statements of comprehensive income (loss) have been omitted, as net income (loss) equals comprehensive income (loss) for the years ended December 31, 2025 and 2024.

Recent Accounting Pronouncements

In March 2020, the Financial Accounting Standards Board (“FASB”) issued Accounting Standard Update (“ASU”) 2020-04, “ Reference Rate Reform (Topic 848) ,” which provides optional guidance for a limited period of time to ease the potential burden in accounting for (or recognizing the effects of) reference rate reform on financial reporting.

ASU 2020-04 provides optional expedients and exceptions for applying GAAP to transactions affected by reference rate reform if certain criteria are met.

These transactions include:

(i) contract modifications, (ii) hedging relationships, and (iii) sales or transfers of debt securities classified as held-to-maturity.

ASU 2020-04 was effective upon issuance, and the provisions generally can be applied prospectively as of January 1, 2020 through December 31, 2024.

The Company’s finance agreements that utilized LIBOR discontinued the use of LIBOR and adopted the Secured Overnight Financing rate (“SOFR”) or Prime Rate, which did not materially impact our consolidated financial statements.

In November 2023, the FASB issued ASU 2023-07, " Segment Reporting (Topic 280):

Improvements to Reportable Segment Disclosures ," which requires public entities to retrospectively disclose information about their reportable segments’ significant expenses on an interim and annual basis.

This ASU is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

The adoption of the new standard affects financial statement disclosure only, and its adoption did not affect our results of operations or financial condition.

In December 2023, the FASB issued ASU 2023-09, " Income Taxes (Topic 740):

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The ASU is effective for fiscal years beginning after December 15, 2024, with early adoption permitted.

The Company is currently evaluating the impact of this ASU on its consolidated financial statements and related disclosures.

Net Income Per Share

Basic net income per share is computed using the weighted-average number of outstanding shares of common stock.

Diluted net income per share is computed using the weighted-average number of outstanding shares of common stock, and when dilutive, shares of common stock issuable upon exercise of options and warrants deemed outstanding using the treasury stock method.

On January 1, 2025, the Company adopted the new accounting pronouncement ASU No.

2023-09 in the current period.

The adoption of ASU No.

2023-09 did not have any impact on the consolidated financial statements of operations.

In November 2024, the FASB issued ASU 2024-03, "Disaggregation of Income Statement Expenses." The ASU enhances disclosures related to income statement expenses to further disaggregate expenses in the footnotes to the financial statements.

The standard requires disaggregation of any relevant expense caption presented on the face of the income statement that contains the following expense categories:

purchases of inventory, employee compensation, depreciation, intangible asset amortization, and depletion.

Further, the standard requires disclosure of the total amount and the entity's definition of selling expenses.

The ASU is effective for fiscal years beginning with its annual financial statements for the year ended December 31, 2027.

There was no material impact to our consolidated statement of operations as a result of the ASU.

Net Income (Loss) Per Share

Basic net income (loss) per share is computed using the weighted-average number of outstanding shares of common stock.

Diluted net income (loss) per share is computed using the weighted-average number of outstanding shares of common stock, and when dilutive, shares of common stock issuable upon exercise of options and warrants deemed outstanding using the treasury stock method.

The following table shows the computation of basic and diluted earnings per share for the following (in thousands, except per share amounts):

Year Ended December 31,

Net income $ 13,488 $ 15,887

Net income (loss) $ ( 2,533 ) $ 13,488

Weighted-average shares outstanding 12,162 12,369

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Weighted-average diluted shares 12,162 12,383

Basic net income per share $ 1.09 $ 1.26

Diluted net income per share $ 1.08 $ 1.25

As of December 31, 2024 and 2023, outstanding options to purchase shares of common stock and outstanding shares of restricted stock in an aggregate of approximately 158,000 and 122,000 , respectively, have been excluded from the calculation of diluted net income per share, as such securities were anti-dilutive.

Goodwill and Intangible Assets

The net book value of goodwill was solely related to the Enteris acquisition in 2019.

The Company reviews goodwill for impairment on an annual basis or whenever events or changes in circumstances indicate the carrying value of an asset may not be recoverable.

During the year ended December 31, 2023, the Company decreased its financial expectations for the License Agreement with Cara and elected to bypass the qualitative goodwill impairment assessment and proceed directly with a quantitative assessment.

The goodwill impairment test concluded that the fair value of the Company's Pharmaceutical Development reporting unit did not exceed the carrying amount and the Company recorded an impairment charge of $ 8.4 million .

An income valuation approach was used to estimate the fair value of the Enteris reporting unit which was estimated through a probability-adjusted discounted cash flow analysis.

As of December 31, 2024, certain assets of the Enteris reporting unit are classified as held for sale, including intangible assets net, of $ 0.2 million - see Note 7 for further details.

Basic net income (loss) per share $ ( 0.21 ) $ 1.09

Diluted net income (loss) per share $ ( 0.21 ) $ 1.09

There were no outstanding options to purchase shares of common stock for the year ended December 31, 2025.

For the year ended December 31, 2024, outstanding options to purchase shares of common stock in an aggregate of approximately 40,000 have been excluded from the calculation of diluted net income (loss) per share, as such securities were anti-dilutive.

Intangible Assets

As of December 31, 2023 , the gross book value, accumulated amortization, net book value and estimated useful life of acquired intangible assets were as follows (in thousands, except estimated useful life data):

As of December 31, 2023

Gross Book Value Accumulated Amortization Net Book Value Estimated Useful Life

License Agreement (1)

$ 29,400 $ 23,167 $ 6,233 10

Trade names and trademarks 210 92 118 10

Customer relationships 240 104 136 10

Total $ 29,850 $ 23,363 $ 6,487

(1) Prior to the Company's acquisition of Enteris, Enteris entered into the License Agreement with Cara, for oral formulation rights to Enteris’ technology to develop and commercialize Oral KORSUVA TM in any indication worldwide, excluding South Korea and Japan.

Cara is obligated to pay Enteris certain development, regulatory and tiered commercial milestone payments, as well as low single-digit royalties based on net sales in the licensed territory.

During 2024, the Company concluded that the milestones and royalties pursuant to the License Agreement would not be realized as a result of non-viability of product covered by the License Agreement.

The Company has recognized a full impairment on the license of its remaining net book value of $ 5.8 million which is included in the "Loss on impairment of intangible assets" section of our consolidated statements of income.

Amortization expense related to intangible assets was $ 0.5 million and $ 1.7 million for the year ended December 31, 2024 and 2023 , respectively.

Intangible Assets

As of December 31, 2024, certain assets of the MOD3 reporting unit were classified as held for sale, including intangible assets net, of $ 0.2 million - see Note 6 for further details.

During the year ended December 31, 2025, the Company recorded an impairment of intangible assets of $ 0.2 million in the consolidated statement of operations.

Prior to the Company's acquisition of MOD3, MOD3 entered into the License Agreement with Cara, for oral formulation rights to MOD3 technology to develop and commercialize Oral KORSUVA TM in any indication worldwide, excluding South Korea and Japan.

Cara is obligated to pay MOD3 certain development, regulatory and tiered commercial milestone payments, as well as low single-digit royalties based on net sales in the licensed territory.

During 2024, the Company concluded that the milestones and royalties pursuant to the License Agreement would not be realized as a result of non-viability of product covered by the License Agreement and as a result the Company has recognized a full impairment on the license of its remaining net book value of $ 5.8 million which is included in the " Loss on impairment " section of our consolidated statements of operations.

There was no amortization expense related to intangible assets during the year ended December 31, 2025.

Amortization expense related to intangible assets was $ 0.5 million for the year ended December 31, 2024.

Finance Receivables

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The loan portfolio segment is defined as the level at which an entity develops and documents a systematic method for determining its allowance for credit losses.

The Company adopted ASU 2016-13, as amended, on January 1, 2023 using the modified retrospective approach method.

The implementation of ASU 2016-13 also impacted the Company's ACL on unfunded loan commitments, as the ACL now represents expected credit losses over the contractual life of commitments not identified as unconditionally cancellable by the Company.

The reserve for unfunded commitments is estimated using the same reserve or coverage rates calculated on collectively evaluated loans following the application of a funding rate to the amount of the unfunded commitment.

The funding rate represents management's estimate of the amount of the current unfunded commitment that will be funded over the remaining contractual life of the commitment and is based on historical data.

On January 1, 2023, the Company recorded an adjustment for unfunded commitments of $ 0.4 million for the adoption of ASU 2016-13.

As of December 31, 2024 and December 31, 2023, the Company has a $ 0.1 million and $ 0.2 million, respectively, liability for credit losses on off-balance sheet exposures related to unfunded commitments, with this liability included in accounts payable and accrued liabilities on the consolidated balance sheets.

As of December 31, 2025 and December 31, 2024, the Company has a $ 0.1 million liability for credit losses on off-balance sheet exposures related to unfunded commitments, with this liability included in accounts payable and accrued liabilities on the consolidated balance sheets.

Please refer to Note 8 for further information on the Company's unfunded commitments.

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Allowance at beginning of period $ 7,158 $ 4,091 $ 11,249 $ 9,731 $ 4,170 $ 13,901

Effect of adoption of ASU 2016-13 — — — 8,900 2,886 11,786

Provision for (benefit from) credit losses ( 1,367 ) 368 ( 999 ) 8,907 ( 79 ) 8,828

Write offs, net of recoveries — ( 2,972 ) ( 2,972 ) ( 11,480 ) — ( 11,480 )

( 11,480 ) — ( 11,480 ) — ( 11,846 ) ( 11,846 )

Allowance at end of period $ 5,791 $ 1,487 $ 7,278 $ 7,158 $ 4,091 $ 11,249

(1) Reversal of finance receivable-specific ACL recognized in prior periods.

No impact to consolidated statement of income for the year ended December 31, 2023.

Non-Accrual Finance Receivables

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Total carrying value $ 8,429 $ 210,198 $ 218,627 $ 12,755 $ 265,005 $ 277,760

As of December 31, 2024, the Company had four finance receivables in nonaccrual status:

As of December 31, 2025, the Company had three finance receivables in nonaccrual status:

(1) the Flowonix Medical, Inc.

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(“Best”) royalty, with a carrying value of $ 1.8 million;

(3) the Ideal Implant, Inc.

and the Ideal Implant, Inc.

(“Ideal”) royalty, with a carrying value of $ 2.3 million.

and (4) the term loan to BIOLASE, Inc ("BIOLASE"), with a carrying value of $ 1.0 million.

The Company collected $ 15.9 million and $ 2.4 million on these nonaccrual finance receivables for the years ended December 31, 2024 and 2023 , respectively .

Term Loan Settlements/Payoffs

On November 14, 2024, a third party purchased certain Exeevo assets in accordance with an Asset Purchase Agreement ("Exeevo APA"), whereby the Company received a payment of $ 3.4 million cash at closing, a net $ 0.7 million payment in January 2025, and $ 0.5 million in February 2025.

Additionally, the Company is eligible to receive a three year contingent earn out consisting of 30 % of the annual increase in SAAS gross margin.

The Company assigned no value to the contingent earn out given the uncertainty that the contingencies will be met.

BIOLASE filed for Chapter 11 bankruptcy protection on October 1, 2024.

The Company agreed to make additional fundings to support the Chapter 11 process through Debtor-in-Possession (“DIP”) Financing and on October 9, 2024, the Company advanced an additional $ 1.4 million DIP Financing to BIOLASE.

During November 2024 certain assets of Biolase were sold to a third party.

On November 27, 2024 the Company received a $ 13.0 million payment from the bankruptcy estate.

The Company received an additional payment of $ 1.0 million in February 2025..

On December 16, 2024, certain assets of Trio Healthcare were sold to a third party and the Company received a $ 1.9 million cash payment.

The Company collected $ 3.1 million and $ 15.9 million on finance receivables in nonaccrual status for the years ended December 31, 2025 and 2024 , respectively .

Loan Modifications Made to Borrowers Experiencing Financial Difficulty

Effective January 1, 2023, the Company adopted the provisions of ASU 2022-02, which eliminated the accounting for TDRs while expanding loan modification and vintage disclosure requirements.

The update specifically required additional disclosures on loan modifications to borrowers experiencing financial difficulties that involved an interest rate reduction, other-than-insignificant payment delay, a term extension, principal forgiveness or a combination thereof.

The Company evaluates the carrying value of each finance receivable for impairment.

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Revaluation of Finance Receivable

On April 10, 2025, the Company completed the sale of the majority of its finance receivables segment royalty portfolio to Soleus Capital (“Soleus”) for approximately $ 34.0 million in cash ("the Transaction"), which approximated the fair value of those royalties.

The amortized cost basis of the royalty portfolio was $ 37.7 million, inclusive of interest receivables of $ 2.3 million.

As a result of the Transaction, the Company performed a lower-of-cost-or-market analysis in the aggregate resulting in a loss of $ 3.7 million which is included in the "Gain (loss) on revaluation of finance receivables" caption on the Company's consolidated statements of operations for the year ended December 31, 2025.

In conjunction with the closing, the Company's Board of Directors declared a special cash dividend of $ 4.00 per share, payable to all holders of record of the Company’s common stock as of April 24, 2025, with a payment date of May 8, 2025.

During the year ended December 31, 2024 , the C ompany revalued its royalty for Iluvien as a result of entering into an amendment.

Pursuant to the amendment, the forecast of cash flows to be received over the life of the financial royalty was revised resulting in a revaluation gain of $ 2.5 million and corresponding mark-up to the carrying value which is included in the "Gain on revaluation of finance receivable" caption on our consolidated statements of income for the year ended December 31, 2024.

Pursuant to the amendment, the forecast of cash flows to be received over the life of the financial royalty was revised resulting in a revaluation gain of $ 2.5 million and corresponding mark-up to the carrying value which is included in the "Gain on revaluation of finance receivables" caption on our consolidated statements of operations for the year ended December 31, 2024.

Credit Quality of Finance Receivables

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Royalties rated as Red are generally classified as non-accrual.

The following table summarizes the carrying value of Finance Receivables by origination year, grouped by risk rating as of December 31, 2024 and December 31, 2023 (in thousands):

The following table summarizes the carrying value of Finance Receivables by origination year, grouped by risk rating (in thousands):

December 31, 2025

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Total Finance Receivables, gross $ 15,934 $ 73,011 $ 66,584 $ 46,107 $ 27,351 $ 60,022 $ 289,009

Property and Equipment, Net

As of December 31, 2024, property and equipment, net, excluded $ 4.6 million that are included in assets held for sale on the consolidated balance sheet.

See Note 7 for further details.

Property and equipment, net consisted of the following (in thousands):

December 31, 2024 December 31, 2023

Production equipment and other $ — $ 4,079

Furniture and fixtures 139 198

Leasehold improvements 13 3,645

Capitalized software 16 192

Total 168 8,114

Less accumulated depreciation and amortization ( 120 ) ( 2,676 )

Property and equipment, net $ 48 $ 5,438

Depreciation and amortization expense on property and equipment was $ 0.9 million and $ 0.8 million for the year ended December 31, 2024 and 2023, respectively.

Marketable Investments

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December 31, 2024 $ 21 $ — $ — $ 21

December 31, 2023 $ 48 $ — $ — $ 48

Equity Securities

During the year ended December 31, 2024 the Company exercised its right to purchase AOTI, Inc ("AOTI") restricted stock.

Upon exercise, the Company received 402,634 shares of AOTI restrictedstock with a fair value of $ 0.7 million, or $ 1.68 per share.

The restricted stock can be converted into publicly traded common shares one year after the exercise date.

The following table presents gains and losses on equity securities as prescribed by ASC 321, Investments - Equity Securities during the year ended December 31, 2024 and 2023 (in thousands):

Net (gain) loss on equity securities during the period $ ( 180 ) $ 799

Net gain (loss) on warrants exercised or cancelled during the period 445 $ ( 799 )

On May 29, 2025, as part of an amendment to an existing term loan finance receivable agreement with Elutia, Inc ("Elutia") the Company received 50,000 shares of common stock with a fair value of $ 0.1 million, or $ 1.65 per share.

Sale of the shares was restricted until maturity of the term loan finance receivable with Elutia.

On June 30, 2024, the Company exercised its right to purchase all outstanding shares of AOTI, Inc ("AOTI") common stock.

Upon exercise, the Company received 402,634 shares of AOTI stock with a fair value of $ 0.7 million, or $ 1.68 per share.

The restricted stock can be converted into publicly traded common stock two years after the exercise date.

The following table presents gains and losses on equity securities as prescribed by ASC 321, Investments - Equity Securities during the years ended December 31, 2025 and 2024 (in thousands):

Net loss (gain) on equity securities during the period $ 384 $ ( 180 )

Net gain on warrants exercised or cancelled during the period — $ 445

Net loss recognized on equity securities sold during the period — ( 180 )

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Assets and Liabilities Held for Sale

With an effective date of January 1, 2024, the Company entered into an Option and Asset Purchase Agreement with a strategic partner on March 14, 2024, which granted the strategic partner an exclusive option to acquire certain of Enteris’ assets related to its business of providing CDMO services to third parties, subject to certain exclusions.

The strategic partner must exercise the Option by or before January 1, 2026.

As we expect the strategic partner to exercise the Option within the next 12 months from the year ended December 31, 2024, certain assets and liabilities of the Enteris business have been classified as held for sale.

The assets and liabilities held for sale represent the major operating assets and liabilities of the Enteris business (i.e.

the majority of the Pharmaceutical Development segment) and as such, when the Option is exercised, this segment of the business will no longer exist and only the specialty finance business will remain.

The decision to enter into the Option and Asset Purchase Agreement was made to align with the overall strategy to focus on the specialty finance business.

Agreement and Plan of Merger

On October 9, 2025, the Company entered into a definitive Agreement and Plan of Merger with Runway Growth Finance Corp.

(“Runway”) and its affiliated entities.

Under the terms of the agreement, Runway will acquire all outstanding equity interests of the Company in a transaction expected to close in the second quarter of 2026, subject to customary closing conditions.

Following execution of the Merger Agreement, management undertook actions during the fourth quarter of 2025 to prepare the Company for the transaction, including discontinuing the evaluation of alternative strategic options and initiating activities necessary to complete the merger.

As a result, the Company determined that the planned sale of the Company met the criteria for held for sale classification as of December 31, 2025.

The Company recorded an impairment charge of approximately $ 0.4 million related to its remaining fixed assets and right of use assets during the quarter, which was recognized within “Loss on impairment” on the consolidated statement of operations for the year ended December 31, 2025.

The transaction is expected to be structured as a stock acquisition;

therefore, the Company’s finance receivables, which represent a substantial portion of the total assets, will remain within the legal entity and continue to be managed in the ordinary course of business.

As a result, the Company’s finance receivables continue to be classified as loans held for investment as of December 31, 2025.

In connection with the planned sale, the Company reassessed the realizability of its deferred tax assets, recorded a valuation allowance of $ 17.9 million against its deferred tax asset as of December 31, 2025, and recognized income tax expense of $ 22.6 million for the year ended December 31, 2025.

Although the planned sale represents a significant strategic transaction, it does not qualify for discontinued operations presentation as the disposal group represents the remaining operations of the Company and is not a component.

The Company’s results of operations and any gains or losses associated with the held for sale classification continue to be reported within income from continuing operations.

MOD3 Exclusive Option and Asset Purchase Agreement

With an effective date of January 1, 2024, the Company entered into an Option and Asset Purchase Agreement (the "Option Agreement") with Aptar on March 14, 2024, which granted Aptar an exclusive option to acquire certain of MOD3 assets related to its business of providing contract development and manufacturing organizations ("CDMO") services to third parties, subject to certain exclusions.

Aptar was required to exercise the Option by or before January 1, 2026.

In exchange for the exclusive purchase option the partner provided consideration in the form of an "option fee" and "guaranteed revenue payments."

The option fee was broken into two components:

A low-single digit million fee due within 30 business days of executing the agreement;

and should the option not be exercised by the first anniversary of the effective date, an additional low-single digit million fee will be due at that time.

The first option fee was paid in April 2024 and the second option fee was paid in February 2025.

Option fee payments were included in deferred income until the earlier of term expiration or exercise of the purchase option.

Upon the exercise of the purchase option, the option fee payments were applied towards the purchase price.

The guaranteed revenue payments included two components:

A mid-single digit million guaranteed revenue payment in 2024 and a mid-single digit million guaranteed revenue payment in 2025.

The revenue was to be derived by the partner under an existing collaboration agreement, and the partner was to pay the difference should the minimum amount not be met each year.

Each year's guaranteed revenue amount is to be paid in two installments semi-annually each year.

Should revenue exceed the 2024 or 2025 guaranteed revenue amounts after receiving a difference payment in the first half of the year, we would be required to repay the partner the amount of such overpayment.

There was $ 0.2 million guaranteed revenue recognized during the year ended December 31, 2025 and $ 0.4 million guaranteed revenue recognized during the year ended December 31, 2024 .

On July 15, 2025, the Company, MOD3, and Aptar closed the asset purchase agreement (the "Purchase Agreement") for the sale and assignment of the assets to Aptar (the "sale of business") for an aggregate purchase price of approximately $ 6.9 million which includes cash previously paid by Aptar in accordance with the Option Agreement.

For the year ended December 31, 2025, the Company recognized a net gain on sale of $ 1.6 million for the completion of the sale, which was inclusive of $ 3.3 million in option fees recognized as a component of the gain on sale.

The gain was recognized in the "gain on sale of business" line item in our consolidated statement of operations for year ended December 31, 2025.

As a result of the option being exercised, Aptar's obligation to continue making guaranteed payments for the period following the closing of the sale of business was terminated.

As the Company expected Aptar to exercise the Option within 12 months from December 31, 2024, certain assets and liabilities of the MOD3 business were classified as held for sale as of December 31, 2024.

The assets and liabilities held for sale as of December 31, 2024, represent the major operating assets and liabilities of the MOD3 business (i.e.

the majority of the Pharmaceutical Development segment).

The decisions to enter into the Option Agreement and the Purchase Agreement were made to align with the overall strategy to focus on the specialty finance business.

The following table summarizes the assets and liabilities held for sale:

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Total liabilities held for sale $ 1,255

During the year ended December 31, 2024, there was not a strategic shift for the Company, and accordingly, the Pharmaceutical Development segment does not meet the criteria to be classified as a discontinued operation.

As a result, we will continue to report our operational results for the Pharmaceutical Development segment until the sale.

The following table shows the net loss before taxes for Enteris (in thousands):

Net loss before taxes $ ( 3,718 ) $ ( 9,763 )

During the years ended December 31, 2025 and 2024, the sale of MOD3 to Aptar did not represent a strategic shift for the Company, and accordingly, the Pharmaceutical Development segment does not meet the criteria to be classified as a discontinued operation.

As a result, we continued to report our operational results for the Pharmaceutical Development segment until the sale.

The following table shows the net income (loss) before taxes for MOD3 (in thousands):

Net income (loss) before taxes 119 ( 3,718 )

Revolving Credit Facility

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On August 29, 2024, the Company entered into an amendment to the Credit Agreement pursuant to which the consolidated interest coverage ratio of Borrower will not be less than 2.00 to 1:00, the net charge-off percentage in relation to Borrower's portfolio of loan assets will not be less than 8 % for such calendar month, and cumulative share repurchases will not exceed $ 7.0 million in value in any 12-month period.

As of December 31, 2024 and 2023, there were $ 6.2 million and $ 12.4 million, respectively, outstanding under the new Credit Agreement.

During the years ended December 31, 2024 and 2023, the Company recognized $ 1.1 million and $ 1.0 million, respectively, of interest expense in connection with the Credit Agreement and Prior Credit Agreement.

On December 4, 2025, the Company and the Lenders entered into a Sixth Amendment to the Credit Agreement (the “Amendment”), which amended the Credit Agreement, dated as of June 28, 2023, in order to reduce the aggregate commitments thereunder from $ 60.0 million to $ 10.0 million.

As of December 31, 2025, there was no outstanding amount under the new credit agreement.

As of December 31, 2024, there was $ 6.2 million outstanding under the new Credit Agreement.

During the years ended December 31, 2025 and 2024, the Company recognized $ 1.1 million and $ 1.1 million, respectively, of interest expense in connection with the Credit Agreement.

On February 12, 2026, First Horizon Bank and the financial institutions party thereto entered into a Seventh Amendment to Credit Agreement (the “Amendment”), which amended the Credit Agreement, dated as of June 28, 2023 (as amended by the Amendment, the “Credit Agreement”), by and among the Company, SWK Funding LLC, the lenders party thereto and First Horizon Bank as a lender and agent, in order to, effective as of February 12, 2026, amend the financial covenants and reduce the aggregate commitments thereunder from $ 10.0 million to $ 7.5 million.

Senior Notes Due 2027

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December 31, 2025

Total unsecured senior notes, net 32,969

Total unsecured senior notes $ 32,969

The Company may redeem the Notes for cash in whole or in part at any time (i) on or after September 30, 2025 (the “First Call Date”) and prior to September 30, 2026, at a price equal to the sum of 102 % of their principal amount, and (ii) on or after September 30, 2026 at a price equal to the sum of 100 % of their principal amount, plus (in each case noted above) accrued and unpaid interest to, but excluding, the date of redemption.

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The Notes are senior unsecured obligations of the Company and rank equal in right of payment with the Company’s existing and future senior unsecured indebtedness.

The Company evaluated the 2027 Senior Notes for derivatives pursuant to Accounting Standard Codification ("ASC") 815, " Derivatives and Hedging ," and identified an embedded derivative that required bifurcation as the feature is not clearly and closely related to the host instrument.

The Company evaluated the 2027 Senior Notes for derivatives pursuant to ASC 815, " Derivatives and Hedging ," and identified an embedded derivative that required bifurcation as the feature is not clearly and closely related to the host instrument.

The embedded derivative was a default provision, which could require additional interest payments.

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Right-of-use ("ROU") assets related to operating leases are included on the consolidated balance sheets in other non-current assets.

Operating lease cost is recognized over the lease term on a straight-line basis and is recorded within general and administrative expenses on the consolidated statements of income.

Operating lease cost is recognized over the lease term on a straight-line basis and is recorded within general and administrative expenses on the consolidated statements of operations.

In March of 2023, the Company entered into a new lease for office space in Dallas, Texas on Sherry Lane.

The Company’s corporate office space in Dallas, Texas totals approximately 4,450 square feet.

On June 10, 2024, the Company entered into a lease termination agreement to its Preston Road office lease in Dallas (the “Lease Termination”).

The Lease Termination terminated the Company’s rights and obligations with respect to the leased premises on June 30, 2024.

As such, the ROU assets and operating lease liabilities were written off, and the Company recorded a gain of $ 3 thousand for the year ended December 31, 2024 and paid an early termination fee of $ 9 thousand.

The Enteris headquarters is located in Boonton, New Jersey, where Enteris leases approximately 32,000 square feet of space.

Total rent expense recognized under the lease was $ 0.3 million for both the years ended December 31, 2024 and 2023.

The office lease expires in December 2029 with an option to renew for an additional five years .

Cash paid for amounts included in the measurement of operating lease liabilities was $ 0.4 million and $ 0.5 million for the years ended December 31, 2025 and 2024 and right-of-use assets obtained in exchange for new operating lease obligations was $ 0.4 million and $ 0.5 million.

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Operating lease right-of-use assets (1)

Other non-current assets $ 518 $ 2,085

Other non-current assets, net $ — $ 518

Operating lease liabilities, current Other current liabilities 144 130

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Total operating lease liabilities (2)

$ 598 $ 2,230

(1) As of December 31, 2024 operating lease right-of-use assets exclude $ 1.2 million that are included in assets held for sale, net, on the consolidated balance sheet.

As of December 31, 2025, operating lease right-of-use assets totaling $ 0.4 million were presented net of a valuation adjustment on disposal group of $ 0.4 million.

(2) As of December 31, 2024 total operating lease liabilities exclude $ 1.3 million that are included in liabilities held for sale on the consolidated balance sheet.

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Total future lease payments $ 499

(1) As of December 31, 2024, total future lease payments exclude $ 1.4 million of lease payments related to held for sale leases, of which $ 0.3 million are due in 2025.

Contingent Consideration

During fiscal year 2019 the Company recorded contingent consideration related to the 2019 acquisition of Enteris and sharing of certain milestone and royalties due to Enteris pursuant to the License Agreement.

During fiscal year 2019 the Company recorded contingent consideration related to the 2019 acquisition of MOD3 and sharing of certain milestone and royalties due to MOD3 pursuant to the License Agreement.

Contingent consideration is remeasured to fair value at each reporting date until the contingency is resolved, with changes in the estimated fair value recognized in earnings.

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Accordingly, the Company concluded that the liability for contingent consideration, previously held at its estimated fair value of $ 4.9 million, should be $ 0 .

The write-off of this contingent consideration liability resulted in a gain of $ 4.9 million during the year ended December 31, 2024, and is included in the "Change in fair value of acquisition-related contingent consideration" caption of our consolidated statements of income.

Unfunded Commitments

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As of December 31, 2025, the Company is not involved in any arbitration and/or other legal proceeding that it expects to have a material effect on its business, financial condition, results of operations and cash flows.

Merger Litigations

On March 6, 2026, in connection with the Mergers, a purported individual shareholder of the Company filed a complaint in New York state court, captioned Eric Brady v.

SWK Holdings Corp., et al., No.

651394/2026 (N.Y.

Cnty.), naming as defendants the Company and certain members of the Company’s board of directors as of the date of the Merger Agreement (“Brady”).

On March 9, 2026, an additional case was filed by a purported individual shareholder of the Company in the same court against the same defendants, captioned Anthony Malone v.

SWK Holdings Corp., et al., No.

651422/2026 (N.Y.

Cnty.) (“Malone”).

The Brady and Malone cases, and any similar subsequently filed cases involving the Company, RWAY, their respective boards of directors, or any committee thereof and/or any of their directors or officers relating directly or indirectly to the Merger Agreement, the Mergers, or any related transaction, are referred to as the “Merger Litigations.” The Merger Litigations filed to date generally allege that the proxy statement issued on Schedule 14A by the Company on March 3, 2026 is materially incomplete and misleading and assert claims for negligent misrepresentation and concealment and negligence under New York common law.

The Merger Litigations seek, among other things, an injunction enjoining consummation of the Mergers, rescission of the Mergers, costs of the actions, including attorneys’ fees and experts’ fees and expenses, and any other relief the court may deem just and proper.

In addition, the Company has received multiple demand letters from purported Company stockholders (the “Demand Letters”), alleging that the proxy statement omits material information in violation of federal securities laws and state law disclosure requirements and demanding that the Company provide additional disclosures in an amendment or supplement to the proxy statement.

The Company denies all allegations in the Merger Litigations and the Demand Letters, believes that no additional disclosure is required in the proxy statement, and intends to vigorously defend against these and any similar Merger Litigations and Demand Letters.

Indemnification

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The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited;

however, the Company has a director and officer insurance policy that limits its exposure and enables the Company to recover a portion of any such amounts.

however, the Company has a director and

officer insurance policy that limits its exposure and enables the Company to recover a portion of any such amounts.

As a result of the Company’s insurance policy coverage, the Company believes the estimated fair value of these indemnification agreements is insignificant.

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On May 31, 2022, the Board authorized a share repurchase program under which the Company was previously authorized to repurchase up to $ 10.0 million of the Company’s outstanding shares of common stock.

The previous repurchase periods under this program were July 1, 2022 through May 15, 2023 and May 16, 2023 through May 15, 2024 (the "Prior Repurchase Programs").

The previous repurchase periods under this program were July 1, 2022 through May 15, 2023, May 16, 2023 through May 15, 2024, and May 16, 2024 through May 16, 2025.

(the "Prior Repurchase Programs").

On May 19, 2025, the Company announced that the Board had authorized the Company to repurchase up to $ 10.0 million of the Company’s outstanding shares of common stock from time-to-time until May 16, 2025, through a trading plan established in compliance with Rule 10b5-1 and Rule 10b-18 of the Exchange Act (the “Current Repurchase Program”).

The actual timing, number and value of shares repurchased under the Current Repurchase Program will depend on several factors, including the constraints specified in the Rule 10b5-1 trading plan, price, and general market conditions.

There is no guarantee as to the exact number of shares that will be repurchased under the Current Repurchase Program.

Our Board may also suspend or discontinue the Current Repurchase Program at any time, in its sole discretion.

The purchase period for the Current Repurchase Program is May 16, 2024 through May 16, 2025.

The Current Repurchase Program was paused on August 11, 2025.

As of December 31, 2025, the Company has repurchased an aggregate of 992,629 shares under the Prior Repurchase Programs and Current Repurchase Program at a total cost of $ 16.5 million, or $ 16.67 per share.

As of December 31, 2024, the maximum dollar value of shares that may yet be purchased under the Current Repurchase Program was approximately $ 5.4 million of shares of common stock.

Preferred Stock

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67,500 $ 12.70 5.0 $ 326

Options canceled and retired ( 22,039 ) 16.29

Options exercised ( 18,750 ) 12.50

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Balances, December 31, 2025

48,750 12.78 3.8 137

Options vested and exercisable and expected to be vested and exercisable at December 31, 2024

48,750 $ 12.78 3.8 $ 137

Options vested and exercisable at December 31, 2024

48,750 $ 12.78 3.8 $ 137

At December 31, 2024, there were approximately 670,235 s hares reserved for issuance under t he 2010 Stock Incentive Plan, a nd the Company had no unrecognized stock option expense for time-based awards.

The following table summarizes significant ranges of outstanding and exercisable options as of December 31, 2024:

Exercise Prices Number Outstanding Weighted-Average Remaining Contractual Life (in years) Weighted-Average Exercise Price per Share Number Exercisable Weighted-Average Exercise Price per Share

$ 9.61 15,000 1.5 $ 9.61 15,000 $ 9.61

$ 12.50 18,750 4.4 $ 12.50 18,750 $ 12.50

$ 16.29 15,000 5.4 $ 16.29 15,000 $ 16.29

Total 48,750 3.8 $ 12.78 48,750 $ 12.78

The company issued an aggregate of 8,764 and 2,595 shares of common stock related to the cashless exercise of stock options during the years ended December 31, 2025 and 2024, respectively.

At December 31, 2025, there were approximately 597,401 s hares reserved for issuance under t he 2010 Stock Incentive Plan.

There were no outstanding and exercisable options as of December 31, 2025.

Employee stock-based compensation expense recognized for time-vesting options for the years ended December 31, 2025 and 2024, uses the Black-Scholes option pricing model for estimating the fair value of options granted under the Company’s equity incentive plans.

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The Company recorded aggregate stock-based compensation expense, including the quarterly and annual Board grants, of $ 1.2 million and $ 0.9 million during the years ended December 31, 2025 and 2024, respectively.

The Company had $ 0.6 million of unrecognized stock option expense for time-based awards, which will be recognized through 2028.

Fair Value Measurements

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Transfers into or out of any hierarchy level are recognized at the end of the reporting period in which the transfers occurred.

There were no transfers between any levels during the years ended December 31, 2024 and 2023.

There were no transfers between any levels for recurring fair value measurements during the years ended December 31, 2025 and 2024.

The following information is provided to help readers gain an understanding of the relationship between amounts reported in the accompanying consolidated financial statements and the related market or fair value.

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Finance receivables are not measured at fair value on a recurring basis, but estimates of fair value are reflected below.

Contingent Consideration

The fair value measurements of the contingent consideration obligations arising from business combinations are classified as Level 3 estimates under the fair value hierarchy, as these items have been valued using unobservable inputs.

These inputs include:

(a) the estimated amount and timing of projected cash flows;

(b) the probability of the achievement of the factors on which the contingency is based;

and (c) the risk-adjusted discount rate used to present value the probability-weighted cash flows.

Changes in fair value of this obligation are recorded as income or expense within operating income in our consolidated statements of income.

Significant increases or decreases in any of those inputs in isolation could result in a significantly lower or higher fair value measurement.

As noted above in Note 9, the acquisition-related contingent consideration liability was written down to $ 0 during the year ended December 31, 2024 due to non-viability of the underlying product.

Marketable Investments

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For non-exchange traded derivatives, fair value is based on option pricing models and are classified as Level 3.

The Company uses a foreign currency forward contract to manage the impact of fluctuations in foreign currency denominated cash flows expected to be received from one of its royalty finance receivables denominated in a foreign currency.

The foreign currency forward contract is not designated as a hedging instrument, and changes in fair value are recognized in earnings.

The foreign currency forward contract was recorded in other non-current assets in the consolidated balance sheets as of December 31, 2024 and December 31, 2023 and totaled to $ 2.5 million and $ 1.0 million, respectively.

The Company recognized a $ 1.5 million and $ 1.7 million gain due to changes in fair value related to its foreign currency forward contract for the years ended December 31, 2024 and December 31, 2023, respectively.

The Company used a foreign currency forward contract to manage the impact of fluctuations in foreign currency denominated cash flows expected to be received from one of its royalty finance receivables denominated in a foreign currency.

During April 2025, the Company sold the related royalty finance receivable as part of the Transaction (See Note 3).

As a result, the Company terminated its foreign currency forward contract and received a cash payment of $ 1.6 million.

The foreign currency forward contract was not designated as a hedging instrument, and changes in fair value were recognized in earnings.

The foreign currency forward contract was recorded in other non-current assets in the consolidated balance sheets as of December 31, 2024 and totaled $ 2.5 million.

The Company recognized a loss of $ 0.9 million and a gain of $ 1.5 million due to changes in fair value related to its foreign currency forward contract for the years ended December 31, 2025 and December 31, 2024, respectively.

The following table presents financial assets and liabilities measured at fair value on a recurring basis as of December 31, 2025 (in thousands):

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Foreign currency forward contract $ 2,475 $ — $ — $ 2,475

Financial liabilities:

Contingent consideration payable $ 4,900 $ — $ — $ 4,900

The contingent consideration payable was valued using a discounted cash flow approach and included a significant unobservable input which is the discount rate.

During the year ended December 31, 2024, there was a write off of the full balance of contingent consideration liability due to the non-viability of the underlying product.

See Note 9 for further information.

The changes on the value of the warrant assets during the years ended December 31, 2025 and 2024 w ere as follows (in thousands):

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Issuance 1,241

Cancelled ( 770 )

Decrease in fair value ( 55 )

Fair Value - December 31, 2023

Issuance 1,241

Exercised ( 985 )

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Fair Value - December 31, 2024

Increase in fair value 775

Gain on foreign currency transactions 235

Fair Value - December 31, 2025

The Company holds warrants issued to the Company in conjunction with certain term loan investments.

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As of December 31, 2024, the Company had one term loan, BIOLASE, that was deemed to be impaired based on reductions in carrying value.

As of December 31, 2023 , the Company had one royalty, Best, that was deemed to be impaired based on reductions in carrying value.

As of December 31, 2024 , the Company had three royalties, Best, Ideal, and Flowonix, that were deemed to be impaired based on reductions in carrying value.

The following table presents these royalty and the loans measured at amortized cost using the effective interest method, which approximates fair value, on a nonrecurring basis (in thousands):

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Foreign currency forward contract 2,475 2,475 — — 2,475

Financial liabilities

Contingent consideration payable $ 4,900 $ 4,900 $ — $ — $ 4,900

Revenue Recognition

As of December 31, 2024, Enteris (Pharmaceutical Development Segment) is classified as held for sale.

The Company's Pharmaceutical Development segment recognizes revenues received from contracts with its customers by revenue source, as we believe it best depicts the nature, amount, timing and uncertainty of our revenue and cash flow.

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The Company’s contract liabilities represent advance consideration received from customers and are recognized as revenue when the related performance obligation is satisfied.

The Company’s contract liabilities are presented as deferred income as of December 31, 2024 in the consolidated balance sheets (in thousands):

The Company’s contract liabilities are presented as deferred income in the consolidated balance sheets (in thousands):

December 31, 2025

Pharmaceutical Development Segment

Balance at January 1, 2024

Beginning balance $ 1,500

Additions to deferred income 1,800

Income recognized (1)

Deferred income 1,500

Balance at December 31, 2024

During the year ended December 31, 2024, the Company recognized the full remaini ng balance of $ 9 thousand of 2023 deferred income from satisfaction of performance obligations.

Ending balance $ —

(1) Included as a component on the gain of sale of MOD3 assets

The Company did not have any contra ct assets as of December 31, 2025 or December 31, 2024.

Enteris Exclusive Option and Asset Purchase Agreement

The strategic partner must exercise the Option by or before January 1, 2026.

As of December 31, 2024,

Enteris is classified as held for sale as the Option is expected to be exercised within the next 12-months - see Note 7 for further details.

In exchange for the exclusive purchase option the strategic partner is to provide consideration in the form of an "option fee" and "guaranteed revenue payments."

The option fee is broken into two components:

A low-single digit million fee due within 30 business days of executing the agreement;

and should the option not be exercised by the first anniversary of the effective date, an additional low-single digit million fee will be due at that time.

The first option fee was paid in April 2024.

Option fee payments will be included in deferred income until the earlier of term expiration or exercise of the purchase option.

Should the strategic partner exercise the purchase option, any option fee payments made will be applied towards the purchase price.

The guaranteed revenue payments include two components:

A mid-single digit million guaranteed revenue payment in 2024 and a mid-single digit million guaranteed revenue payment in 2025.

The revenue was derived by the strategic partner under an existing collaboration agreement, and the strategic partner was to pay the difference should the minimum amount not be met each year, which was $ 0.4 million at the end of 2024.

Each year's guaranteed revenue amount is to be paid in two installments semi-annually each year.

Should revenue exceed the 2024 or 2025 guaranteed revenue amounts after receiving a difference payment in the first half of the year, we must repay the partner the amount of such overpayment.

Guaranteed revenue of $ 0.4 million was recognized during the year ended December 31, 2024.

Segment Information

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The Company does not report assets by reportable segment, as this metric is not used by the Company's CEO in assessing performance or allocating resources to the segments.

As of December 31, 2024, Enteris is classified as held for sale (Pharmaceutical Development segment shown below) - see Note 7 for further details.

The following tables present financial information for the Company’s reportable segments for the periods indicated (in thousands):

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Other revenue 745 116 4 865

Provision for credit losses 12,756 — — 12,756

Loss on impairment of intangible assets — 5,771 — 5,771

Benefit from credit losses ( 924 ) — — ( 924 )

Loss on impairment — 209 432 641

Interest expense 1,115 17 3,665 4,797

Pharmaceutical manufacturing, research and development — 2,203 — 2,203

Change in fair value of acquisition-related contingent consideration — ( 4,900 ) — ( 4,900 )

Pharmaceutical manufacturing, research and development expense — 1,551 — 1,551

Loss on disposal of inventory — 314 — 314

Depreciation and amortization expense — — 40 40

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Provision for credit losses 12,756 — — 12,756

Impairment of goodwill — 8,404 — 8,404

Loss on impairment — 5,771 — 5,771

Interest expense 1,078 8 3,599 4,685

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General and administrative expense 449 2,967 8,071 11,487

Other expense, net ( 13 ) ( 24 ) — ( 37 )

Other income (expense), net 7,194 — ( 408 ) 6,786

Income tax benefit — — 4,884 4,884

Net income (loss) 34,251 ( 3,718 ) ( 17,045 ) 13,488

Included in Holding Company and Other are the expenses of the parent holding company and certain other enterprise-wide overhead costs, including public company costs and non-Enteris corporate employees, which have been included for purposes of reconciling to the consolidated amounts.

Included in Holding Company and Other are the expenses of the parent holding company and certain other enterprise-wide overhead costs, including public company costs and non-MOD3 corporate employees, which have been included for purposes of reconciling to the consolidated amounts.

The following table presents total assets for the Company's reportable segments for the periods indicated (in thousands):

Total Assets (Liabilities)

Finance Receivables $ 268,796 $ 299,248

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Total $ 272,422 $ 332,235

The components of income before income tax expense (benefit) are as follows (in thousands):

The components of income before income tax expense are as follows (in thousands):

$ 20,116 $ 18,372

The Company’s income tax expense (benefit) was as follows (in thousands):

The Company’s income tax expense was as follows (in thousands):

Current expense

State $ 75 $ 78

Deferred expense (benefit)

Deferred expense

Federal 22,401 4,879

State 173 ( 73 )

Total income tax expense (benefit) $ 4,884 $ ( 1,274 )

The components of the income tax expense (benefit) are as follows (in thousands):

Total income tax expense $ 22,649 $ 4,884

The components of the income tax expense are as follows (in thousands):

Federal tax provision at statutory rate $ 4,224 $ 3,858

Change in valuation allowance — ( 6,697 )

State taxes, net of federal income tax benefit 120 ( 13 )

Impairment of goodwill — 1,765

Mark-to-market adjustments ( 82 ) ( 476 )

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Write off of expired deferred tax assets 254 2,405

Total income tax expense (benefit) $ 4,884 $ ( 1,274 )

Change in valuation allowance 17,917 —

Total income tax expense $ 22,649 $ 4,884

The Company records deferred tax assets if the realization of such assets is more likely than not to occur in accordance with accounting standards that address income taxes.

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The Company has considered all available evidence, both positive and negative, such as historical levels of income and predictability of future forecasts of taxable income from existing investments, in determining whether a valuation allowance is required.

The Company is also required to forecast future taxable income in accordance with accounting standards that address income taxes to assess the appropriateness of a valuation allowance, which further requires the

exercise of significant management judgment.

The Company focuses on forecasting future taxable income for the investment portfolio that exists as of the balance sheet date.

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• level of profitability on a quarterly basis.

As of December 31, 2024, the Company had cumulative net income before tax for the three years then ended.

Based on its historical operating performance, the Company had previously concluded that it was more likely than not that the Company would not be able to realize the full benefit of the U.S.

federal and state deferred tax assets in the future.

However, at December 31, 2024 the Company has concluded that it is more likely than not that the Company will be able to realize approximately $ 23.5 million benefit of the U.S.

federal and state deferred tax assets in the future.

The Company will continue to assess the need for a valuation allowance on the deferred tax assets by evaluating both positive and negative evidence that may exist on a quarterly basis.

Any adjustment to the deferred tax asset valuation allowance would be recorded in the consolidated statements of income for the period that the adjustment is determined to be required.

There was no valuation allowance against deferred tax assets as of December 31, 2024 and 2023, respectively.

In connection with the anticipated sale to Runway Growth Finance Corporation expected in the second quarter of 2026, the Company re-evaluated the realizability of its deferred tax assets.

Based on all available evidence, the Company concluded it is more likely than not that a portion of its U.S.

federal and state deferred tax assets will not be realized.

Accordingly, the Company recorded a valuation allowance of $ 17.9 million as of December 31, 2025.

As of December 31, 2024, the Company maintained no valuation allowance against its deferred tax assets

Deferred tax assets consist of the following (in thousands):

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Stock-based compensation 277 230

Impairment 3,352 2,311

Other 720 688

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Gross deferred tax assets $ 18,810 $ 22,243

Valuation Allowance ( 17,917 ) —

Deferred tax liabilities:

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Other 14 ( 622 )

Valuation allowance — —

Net deferred tax assets $ 912 $ 23,484

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The Company records liabilities, where appropriate, for all uncertain income tax positions and recognizes potential accrued interest and penalties related to unrecognized tax benefits within income tax expense.

As of December 31, 2024 and 2023, the Company had approximately $ 0.7 million and $ 0.6 million, respectively of unrecognized tax benefit, none of which would impact the effective tax rate if recognized.

The adoption of these provisions did not have an impact on the Company's consolidated financial condition, results of operations or cash flows.

As of December 31, 2025 and 2024, the Company had approximately $ 0.7 million of unrecognized tax benefit, none of which would impact the effective tax rate if recognized.

The Company does not expect the unrecognized tax benefits to change materially over the next twelve months.

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and various state jurisdictions.

The Company is currently open to audit under the statute of limitations by the Internal Revenue Service for the years ending December 31, 1999 through December 31, 2024 due to

carryforward of unutilized net operating losses and research and development credits.

The Company is currently open to audit under the statute of limitations by the Internal Revenue Service for the years ending December 31, 2007 through December 31, 2025 due to carryforward of unutilized net operating losses and research and development credits.

The Company does not anticipate significant changes to its uncertain tax positions through December 31, 2025.

Subsequent Events

On March 17, 2025, ANI Pharmaceuticals, Inc.

exercised its buyout option related to the Iluvien royalty, which resulted in a payment of approximately $ 17.3 million to the Company.

On March 19, 2025, in a separate transaction, the Company entered into a definitive agreement with Soleus Capital (“Soleus”) for the sale of substantially all of its remaining performing royalty portfolio for approximately $ 34.0 million in cash.

The Soleus transaction is expected to close in approximately two weeks, subject to the satisfactory of customary conditions to closing.

CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 8. Financial Statements and Supplementary Data