Note 10

Long-term Debt:

	December 31,
	2016			2015

Term note, net of debt discount of $258 and $287, respectively; and deferred financing cost of $276 and $306, respectively	$	11,466		$	9,851
Less: current portion		(1,714	)		-
Total long-term debt	$	9,752		$	9,851

Term-Note Credit Facility

On December 30, 2015, the Company entered into a $12,000 credit facility pursuant to a Credit and Security Agreement (the "Agreement") and related financing documents with MidCap Financial Trust ("MidCap") and the lenders listed therein. Under the Agreement, the credit facility may be drawn down in two tranches, the first of which was drawn for $10,500 on December 30, 2015. The proceeds of this first tranche were used to repay $10,000 principal amount of short-term senior secured promissory notes, plus associated interest, loan fees and expenses. The second tranche was drawn for $1,500 on January 29, 2016. On August 8, 2016, the minimum net revenue covenant was amended prospectively. The Company was in compliance with these covenants as of December 31, 2016. The payment term of the credit facility is 60 months, with first 18 months as interest only. The Interest rate on the credit facility is one month LIBOR plus 8.25%, subject to a LIBOR floor of 0.5%. The Company's existing debentures from its 2014 and 2015 financings were amended as a condition of this new term note facility, including subordination agreements and maturity extensions. Additionally if the Company cannot maintain its listing on Nasdaq, it would be deemed a default under the 2015 debentures and a breach of our affirmative covenants and therefore an event of default under the financing documents with Midcap. Unamortized discount on the long term debt and deferred financing costs was $534 and $649 as of December 31, 2016 and 2015, respectively. As of December 31, 2016 the net balance of long-term debt is $11,466.

The following table summarizes the future payments that the Company expects to make for long-term debt:

2017	$	1,714
2018		3,429
2019		3,429
2020		3,428
		12,000

In connection with the issuance of the Term Note the Company issued MidCap (and the lenders), on December 30, 2015, a warrant to purchase 650,442 shares of the Company's common stock for an exercise price of $1.13. Additionally, the Company issued MidCap (and the lenders), on January 29, 2016, a warrant to purchase 99,057 shares of the Company's common stock for an exercise price of $1.06. The warrants are exercisable at any time on or prior to the fifth anniversary of its issue date. The warrants are treated as a discount to the debt and that discount is accreted under the effective interest method over the repayment term of 60 months. The Company has accounted for these warrants as equity instruments since there is no option for cash or net-cash settlement when the warrants are exercised and since they are indexed to the Company's common stock. The Company computed the value of the warrants using the Black-Scholes method.

The key assumptions used to value the warrants are as follows:

	December 31, 2015			January 29, 2016

Number of shares underlying warrants		650,442			99,057
Exercise price	$	1.13		$	1.06
Stock price on date of issuance	$	1.11		$	1.05
Fair value of warrants	$	321		$	47
Volatility		50.0	%		50.0	%
Risk-free interest rate		1.8	%		1.8	%
Expected dividend yield		0	%		0	%
Expected warrant life	5 years			5 years