Revolving Line of Credit

12 Months Ended

Dec. 31, 2016

Debt Disclosure [Abstract]

Revolving Line of Credit

(6) Revolving Line of Credit

The Company entered into an Amended and Restated Loan and Security Agreement with Silicon Valley Bank (Loan Agreement), on August 31, 2014, which has been subsequently amended from time to time. On January 27, 2017, the Loan Agreement was amended to extend the maturity date of the facility to January 28, 2018. Under the Loan Agreement, the Company may borrow up to $20 million subject to compliance with certain covenants and borrowing base limitations. At the Company’s election, the interest rate applicable to borrowings may be based on the prime rate or LIBOR. Prime rate-based rates vary from prime rate plus 0.75% per annum to prime rate plus 1.75% per annum, while LIBOR-based rates vary from LIBOR plus 3.75% per annum to LIBOR plus 4.25% per annum. In addition, the Company is required to pay a monthly unused line fee of 0.5% per annum of the average unused portion of the facility. Obligations under the Loan Agreement are secured by a first priority security interest in all assets of the Company, including those at the East Providence facility, except for certain exclusions.

At December 31, 2016 and 2015, the Company had no amounts drawn under the Loan Agreement. Under the Loan Agreement, the Company is required to comply with both non-financial and financial covenants, including minimum Adjusted EBITDA and minimum Adjusted Quick Ratio, as defined. At December 31, 2016, the Company was in compliance with all such covenants.

The Company has been required to provide its landlord with letters of credit securing certain obligations. In addition, the Company has been required to provide certain customers with letters of credit securing obligations under commercial contracts. The Company had outstanding letters of credit backed by the revolving credit facility of $2.7 million at December 31, 2016 and 2015, which reduce the funds otherwise available to the Company under the Loan Agreement. Based on the available borrowing base and net of the $2.7 million of outstanding letters of credit, the amount available to the Company under the Loan Agreement at December 31, 2016 was $12.1 million.