Note 5. Debt

Debt at March 31, 2018, consisted of the following (in thousands):

	March 31, 2018
	Principal			Unamortized Discount			Total
Loan and Security Agreement	$	30,000		$	(184	)	$	29,816
Less: debt - current		(1,429	)		—			(1,429	)
Debt - non-current	$	28,571		$	(184	)	$	28,387

Debt at December 31, 2017, consisted of the following (in thousands):

	December 31, 2017
	Principal		Unamortized Discount			Net Carrying Value
Loan and Security Agreement	$	30,000	$	(202	)	$	29,798
Less: debt - current		—		—			—
Debt - non-current	$	30,000	$	(202	)	$	29,798

Principal and interest payments on debt at March 31, 2018, are expected to be as follows (in thousands):

Year ended December 31,	Principal		Interest		Total
2018	$	—	$	2,062	$	2,062
2019		7,857		2,447		10,304
2020		8,571		1,673		10,244
2021		8,572		882		9,454
2022		5,000		2,552		7,552
Total	$	30,000	$	9,616	$	39,616

Loan and Security Agreement

Prior to December 31, 2016, the Company maintained a five year loan and security agreement (the “Term Loan Agreement”) with Oxford Finance LLC (“Oxford”), under which the Company borrowed $20.0 million. The Company received $10.0 million from the first tranche (“Term Loan A”) in June 2014. The second tranche of $10.0 million (“Term Loan B”) was drawn in June 2015. Term Loan A bore an interest rate of 6.95%. Term Loan B bore an interest rate of 7.01%. Term Loans A and B were set to mature on June 1, 2019, with various interest only periods.

On April 27, 2017, the Term Loan Agreement was amended to include an additional interest-only period for all advances under the Term Loan Agreement. As amended, the Company was required to make interest only payments from May 2017 through December 2017, followed by eighteen months of equal principal and interest payments thereafter. The Company determined that each of these amendments to the Term Loan Agreement resulted in a debt modification. As a result, the accounting treatment for the Term Loan continued under the interest method, with a new effective interest rate based on revised cash flows calculated on a prospective basis upon the execution of each of these amendments to the Term Loan Agreement. The Company was also required to make a final payment equal to 7% of the principal amounts of the Term Loans drawn payable on the earlier to occur of maturity or prepayment.

On July 31, 2017 (the “Closing Date”), the Company entered into an amended and restated loan and security agreement (the “Amended Credit Agreement”) with Oxford, which amends and restates the Term Loan Agreement in its entirety. The Amended Credit Agreement provides for secured growth capital term loans of up to $40.0 million (the “2017 Term Loans”). All of the Company’s current and future assets, excluding its intellectual property and 35% of the Company’s investment in Cerus Europe B.V., are secured for its borrowings under the Amended Credit Agreement. The 2017 Term Loans are available in two tranches. The first tranche of $30.0 million (“2017 Term Loan A”) was drawn by the Company on July 31, 2017, with the proceeds used in part to repay in full all of the outstanding term loans under the Term Loan Agreement of $17.6 million and the final payment of the Term Loan Agreement of $1.4 million. The second tranche of $10.0 million (“2017 Term Loan B”) will be made available to the Company upon the Company’s achieving consolidated trailing six-month revenues as defined in the agreement (the “Revenue Milestone”). If the Revenue Milestone is achieved, the Company may draw the 2017 Term Loan B through the earlier of (i) January 31, 2019, and (ii) the date which is 60 days after the achievement of the Revenue Milestone. The Company achieved the Revenue Milestone by March 31, 2018, and therefore 2017 Term Loan B is available to be drawn. The Company’s ability to draw the 2017 Term Loan B expires on May 14, 2018. The 2017 Term Loans require interest-only payments through February 1, 2019, followed by 42 monthly payments of equal principal plus declining interest payments. However, if the Company draws the 2017 Term Loan B, then the interest-only period will be extended through August 1, 2019, and the amortization period will be reduced to 36 months. Interest on the 2017 Term Loan A and the 2017 Term Loan B will bear interest at a rate equal to the greater of (i) 8.01% and (ii) the three-month U.S. LIBOR rate plus 6.72%. The interest rate on the 2017 Term Loan A at March 31, 2018, was approximately 9.03%. The Company will also be required to make a final payment fee of 8.00% of the principal amounts of the 2017 Term Loans. The Amended Credit Agreement contains certain nonfinancial covenants, with which the Company was in compliance at March 31, 2018.