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Debt
 12 Months Ended
Dec. 31, 2022
Debt Disclosure [Abstract]  
Debt Debt
On May 8, 2019, the Company entered into a loan and security agreement (the "Prior Credit Facility") with Silicon Valley Bank ("SVB"), pursuant to which the Company borrowed $5.0 million. The Prior Credit Facility accrued interest at a floating per annum rate equal to the greater of (i) 4.0% and (ii) 1.50% below the Prime Rate. The Prior Credit Facility had an interest-only period through August 31, 2020.
On August 28, 2020, the Company entered into a second amendment (the "Second Amendment") to the Prior Credit Facility. Pursuant to the Second Amendment, the Company drew $5.2 million upon execution of the Second Amendment, the proceeds of which were used to repay the Company’s existing balance under the Prior Credit Facility and satisfy its obligations to SVB. The Prior Credit Facility, as amended by the Second Amendment, accrued interest at a floating per annum rate equal to the greater of (i) 4.25% and (ii) 1.00% above the Prime Rate.
On October 29, 2021, the Company entered into a loan and security agreement (the "New Credit Facility") with SVB and Oxford ("Oxford" and, together with SVB and the other lenders from time to time a party thereto, the "Lenders"). Pursuant to the New Credit Facility, as amended on February 17, 2022, October 17, 2022, and December 27, 2022, the Company can borrow term loans in an aggregate amount of $100.0 million, which includes (i) $40.0 million available at the option of the Company in up to four principal advances through June 30, 2023, (ii) an additional $40.0 million in one principal advance, if the Company reaches certain development milestone events, through September 30, 2023 and (iii) an additional tranche of $20.0 million, subject to conditional approval from the Lenders. The New Credit Facility is secured by substantially all of the Company's personal property owned or later acquired, excluding intellectual property (but including the rights to payments and proceeds from intellectual property), and a negative pledge on intellectual property. The Company drew $25.0 million upon execution of the New Credit Facility, of which $5.5 million of the proceeds was used to repay the existing balance under the Prior Credit Facility and satisfy its obligations to SVB. Upon entering into the New Credit Facility, the Company terminated all commitments by SVB to extend further credit under the Prior Credit Facility and all guarantees and security interests granted by the Company to SVB under the Prior Credit Facility.
The New Credit Facility bears interest at a floating per annum rate equal to the greater of (i) 8.50% and (ii) 5.25% above the Prime Rate. Interest is payable monthly in arrears on the first day of each month. The Company is obligated to make interest-only payments through November 1, 2024, followed by equal monthly principal payments and applicable interest through the maturity date of October 1, 2026 (the Maturity Date). If certain development milestones are met, then the interest-only period will be extended to November 1, 2025.
The Company is also required to make a final payment to the Lenders equal to 4.25% of the principal amount of the term loans then extended to the Company. This final payment is accreted under the effective interest method over the life of each term loan. The term loans are secured by substantially all of the Company’s assets, except for its intellectual property which is subject to a negative pledge, and certain other customary exclusions.
At the Company’s option, it may prepay the outstanding principal balance of any term loans in whole but not in part, subject to a prepayment fee of: (a) 3.0% of the term loans then extended to the Company if the prepayment occurs on or prior to the first anniversary of the funding date of such term loan, (b) 2.0% of the term loans then extended to the Company if the prepayment occurs after the first anniversary of the funding date of such term loan but on or prior to the second anniversary of the funding date of such term loan, or (c) 1.0% of the term loans then extended to the Company if the prepayment occurs after the second anniversary of the funding date of such term loan but before the Maturity Date. The New Credit Facility includes customary affirmative and restrictive covenants applicable to the Company. Affirmative covenants include, among others, covenants requiring the Company to maintain its corporate existence and governmental approvals, deliver certain financial reports, maintain insurance coverage and satisfy certain requirements regarding deposit accounts. The restrictive covenants include, among others, requirements relating to the Company’s ability to transfer collateral, incur additional indebtedness, engage in mergers or acquisitions, pay dividends or make other distributions, make investments, create liens, sell assets and agree to a change in control, in each case subject to certain customary exceptions.
The Company’s payment obligations under the New Credit Facility are subject to acceleration upon the occurrence of specified events of default, which include, but are not limited to, the occurrence of a material adverse change in the Company’s business, operations, or financial or other condition. Amounts outstanding upon the occurrence of an event of default are payable upon the Lenders' demand and shall accrue interest at an additional rate of 5.0% per annum of the past due amount outstanding. As of December 31, 2022, the Company was in compliance with all covenants under the New Credit Facility. As such, as of December 31, 2022, the classification of the loan balance as stated on the balance sheet was based on the timing of defined future payment obligations.
The following is a summary of obligations under the New Credit Facility as of December 31, 2022:
(in thousands)December 31,
2022
Total debt$25,000 
Less: Current portion of long-term-debt— 
Total debt, net of current portion25,000 
Debt financing costs, net of accretion(324)
Accretion related to final payment253 
Long-term debt, net$24,929 
As of December 31, 2022, the estimated future principal payments due are as follows:
(in thousands)
2023$— 
20242,083 
202512,500 
202610,417 
Total debt$25,000 
Interest expense related to the New Credit Facility for the year ended December 31, 2022 was $3.2 million. The Company did not recognize any interest expense related to the New Credit Facility during the year ended December 31, 2021. Interest expense related to the Prior Credit Facility for the year ended December 31, 2021 was $0.8 million. The Company did not recognize any interest expense related to the Prior Credit Facility during the year ended December 31, 2022.