Long-Term Debt

6 Months Ended

Jun. 30, 2022

Debt Disclosure [Abstract]

Long-Term Debt

5. Long-Term Debt

Secured Term Loan Facility

On March 10, 2021, the Company executed the Term Loan which provided a loan in the aggregate principal amount of up to $80 million, in three tranches. On March 29, 2021, the Company drew the initial $25.0 million tranche under the Term Loan. After giving effect to payment of fees and expenses associated with the draw, the Company received net proceeds of approximately $24.4 million. The Term Loan bore interest at a floating rate equal to the greater of either (i) 8.75% plus the prime rate as reported in The Wall Street Journal minus 3.25%, or (ii) 8.75%. The Company was initially obligated to make monthly payments of accrued interest under the Term Loan commencing on the initial borrowing date and continuing to April 1, 2023, followed by monthly installments of principal and interest until March 1, 2025. In July 2022, the Company prepaid $25.0 million of outstanding principal, together with approximately $1.7 million of accrued interest, fees and other amounts, due under the Term Loan. In connection with the prepayment, the Term Loan with Hercules was terminated, and all obligations, liens and security interests under the Term Loan were released, discharged and satisfied (see Note 11). By retiring the Term Loan, the Company is able to reduce future cash payments for interest and enhance its ability to generate additional liquidity from its intellectual property by removing the loan’s collateral requirements. 

Interest expense related to the Term Loan was $0.8 million and $1.5 million for the three and six months ended June 30, 2022, respectively, and the effective interest rate was approximately 9.7% and 9.4% for the three and six months ended June 30, 2022, respectively. Interest expense related to the Term Loan was $0.6 million for both the three- and six-month periods ended June 30, 2021, and the effective interest rate was approximately 9.0% in both periods.