BEYOND MEAT, INC.BYND
BEYOND MEAT, INC. Fair Value Disclosure
Fair Value of Financial Instruments
The Company had no financial instruments measured at fair value on a recurring basis as of December 31, 2024.
There were no transfers of financial assets or liabilities into or out of Level 1, Level 2 or Level 3 in the years ended December 31, 2025, 2024 or 2023.
Valuation of Warrant Liability
On June 26, 2025, in connection with the Initial Draw, the Company issued to Unprocessed Foods Warrants to purchase 3,823,454 shares of common stock with an initial exercise price of $3.26 per share, a fair value per share of $2.09 and an aggregate fair value of $8.0 million. The aggregate fair value of the issued Warrants was recorded as a discount to the $40.0 million in term loan balance included in Delayed draw term loans, net in the Company’s consolidated balance sheet and is being amortized to interest expense using the effective interest rate method.
The following were the assumptions used in the Black-Scholes option-pricing model to determine the fair value of the Warrants issued in connection with the Initial Draw at issuance on June 26, 2025:
| Risk-free interest rate | 3.79% | ||||
| Average expected term (years) | 5.0 | ||||
| Expected volatility | 69.35% | ||||
| Dividend yield | — | ||||
As of June 28, 2025, the Company concluded it was reasonably certain to draw the remaining $60.0 million available under the Delayed Draw Term Loan Facility before December 31, 2025, and therefore reasonably certain that it would issue to the Lenders Warrants to purchase the remaining 5,735,181 unissued shares of common stock pursuant to the Loan and Security Agreement. The fair value of the contingently issuable Warrants measured as of June 28, 2025 was $12.1 million. The Company recorded $20.1 million in liability for the total fair value of the issued and contingently issuable Warrants in Delayed draw term loan warrants in its consolidated balance sheet at June 28, 2025.
The following were the assumptions used to determine the fair value of the contingently issuable Warrants as of June 28, 2025, assuming the draw of the remaining $60.0 million available under the Delayed Draw Term Loan Facility before December 31, 2025:
| Assumption | As of June 28, 2025 | |||||||
| Issue date | June 26, 2025 | |||||||
| Expiration date | June 26, 2030 | |||||||
| Remaining term to expiration (years) | 5.0 | |||||||
| Remaining term to expiration (trading weeks) | 260 | |||||||
| Annualized volatility | 70.00% | |||||||
| Risk-free interest rate (continuous) | 3.76% | |||||||
On September 18, 2025, the Company drew the remaining $60.0 million available under the Delayed Draw Term Loan Facility. In connection with the Second Draw, the Company issued to Unprocessed Foods Warrants to purchase 5,735,181 shares of common stock with an initial exercise price of $3.26 per share, that were previously accounted for as contingently issuable Warrants.
On December 22, 2025, the exercise price of the Warrants was reduced to $1.95 from $3.26, pursuant to the provisions of the Warrant Agreement, which require a weighted average adjustment of the exercise price of the Warrants for certain below-market issuances of equity or equity-linked securities, subject to exceptions set forth in the Warrant Agreement.
The Company remeasured the fair value of the total warrant liability as of December 31, 2025 marking it to market. The following were the assumptions used in the Black-Scholes option-pricing model to mark-to-market the fair value of the total warrant liability as of December 31, 2025, the last trading day of the period:
| Risk-free interest rate | 3.73% | ||||
| Average expected term (years) | 4.5 | ||||
| Expected volatility | 107.25% | ||||
| Dividend yield | — | ||||
Total change in fair value of the Warrants recorded in , for the year ended December 31, 2025, was $15.1 million shown below.
The following table sets forth a summary of the changes in the fair value of the warrant liability for the periods indicated:
| Year Ended | ||||||||||||||
| (in thousands) | December 31, 2025 | December 31, 2024 | ||||||||||||
| Beginning balance | $ | — | $ | — | ||||||||||
| Fair value of warrants issued during the period | 20,143 | — | ||||||||||||
| Change in fair value of issued warrants | (15,077) | — | ||||||||||||
| Ending balance | $ | 5,066 | $ | — | ||||||||||
Valuation of 2030 Notes Embedded Derivative
The Company determined that the conversion option embedded within the 2030 Notes required bifurcation as a derivative liability under ASC 815. The sensitivity of the fair value calculation to these methods, assumptions, and estimates included could create materially different results under different conditions or using different assumptions. The mandatory conversion feature along with the make whole interest, the mandatory equitization feature along with the make whole interest and the holder’s optional conversion feature with the make whole interest require bifurcation and therefore, these embedded derivatives were bifurcated, along with the conversion option, from the debt host as a single, compound derivative liability (the “2030 Notes Embedded Derivative”).
The Company uses a binomial lattice valuation model in order to estimate the fair value of the 2030 Notes Embedded Derivative at inception and on subsequent period end dates. A binomial lattice valuation model generates two probable outcomes, whether up or down, arising at each point in time, starting from the inception date to the maturity date. Using this lattice model, the Company valued the 2030 Notes Embedded Derivative using a “with-and-without method,” where the value of the 2030 Notes including the embedded derivative is defined as the “with,” and the value of the 2030 Notes excluding the embedded derivative is defined as the “without,” with the difference recognized as the fair value of the 2030 Notes Embedded Derivative. Accordingly, the fair value of the 2030 Notes Embedded Derivative at the issuance date was $26.9 million, recorded as a debt discount to the 2030 Notes and is being amortized to interest expense over the term of the debt. For the year ended December 31, 2025, the Company recognized $1.1 million in interest expense related to the amortization of this discount. Furthermore, the change in fair value of the 2030 Notes Embedded Derivative from the issuance date to December 31, 2025 was $12.3 million and recognized in the Company’s consolidated statements of operations. As of December 31, 2025, the embedded derivative liability was $39.2 million. See Note 9. Due to the use of a qualitative adjustment for estimating volatility, the binomial lattice valuation used is considered Level 3 in the valuation hierarchy.
The following table sets forth selected inputs to the binomial lattice valuation model used to value the 2030 Notes Embedded Derivative:
| Inputs | 10/15/2025 | 12/31/2025 | ||||||||||||
| (at inception) | ||||||||||||||
| Term | 5.0 years | 4.8 years | ||||||||||||
| Continuous risk free rate | 3.60 | % | 3.68 | % | ||||||||||
| Volatility | 40.0 | % | 40.0 | % | ||||||||||
| Stock price on valuation date | $ | 0.67 | $ | 0.82 | ||||||||||
| Discount rate (continuous) | 24.89 | % | 19.71 | % | ||||||||||
About Fair Value Disclosures
Fair value disclosures classify all assets and liabilities measured at fair value into a three-level hierarchy: Level 1 (quoted market prices), Level 2 (observable inputs like yield curves), and Level 3 (unobservable inputs requiring management estimates). The proportion of Level 3 assets directly reflects how much of the balance sheet depends on internal models rather than market evidence.
Key signals: a growing Level 3 balance relative to total fair-value assets increases valuation uncertainty and earnings volatility risk. Watch for transfers between levels — assets moving from Level 2 to Level 3 often signal deteriorating market liquidity. Unrealized gains and losses on Level 3 positions flow through earnings or other comprehensive income, so large swings deserve scrutiny. For financial institutions, examine the sensitivity disclosures that show how Level 3 valuations change under alternative assumptions. Compare the fair value of debt against its carrying amount to gauge hidden leverage.