Note 5. Debt

Debt at September 30, 2018, consisted of the following (in thousands):

	September 30, 2018
	Principal			Unamortized Discount			Total
Loan and Security Agreement	$	30,000		$	(148	)	$	29,852
Less: debt – current		(5,714	)		—			(5,714	)
Debt – non-current	$	24,286		$	(148	)	$	24,138

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 September 30, 2018, are expected to be as follows (in thousands):

Year ended December 31,	Principal		Interest		Total
2018	$	—	$	689	$	689
2019		7,857		2,470		10,327
2020		8,571		1,689		10,260
2021		8,572		891		9,463
2022		5,000		2,554		7,554
Total	$	30,000	$	8,293	$	38,293

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 provided 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 were 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 availability of the second tranche of $10.0 million (“2017 Term Loan B”) expired on May 14, 2018, and the Company did not elect to draw the 2017 Term Loan B. The 2017 Term Loan A requires interest-only payments through February 1, 2019, followed by 42 monthly payments of equal principal plus declining interest payments. The 2017 Term Loan A bears 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 September 30, 2018, was approximately 9.12%. The Company will also be required to make a final payment fee of 8.00% of the principal amount of the 2017 Term Loan A. The Amended Credit Agreement contains certain nonfinancial covenants, with which the Company was in compliance at September 30, 2018.