Long-term debt

6 Months Ended

Jun. 30, 2020

Long-term debt

Long-term debt

7 Long-term debt

On June 14, 2013, the Company entered into a venture debt loan facility with Hercules Growth Capital, Inc. (“Hercules”), which was amended and restated on June 26, 2014, and again on May 6, 2016 (“2016 Amended Facility”). On December 6, 2018, the Company signed an amendment to the Second Amended and Restated Loan and Security Agreement that both refinanced the then-existing $20 million 2016 Amended Facility and provided an additional unconditional commitment of $15 million as well as a conditional commitment of $15 million that expired on June 30, 2020 (the “2018 Amended Facility”). At signing of the 2018 Amended Facility, the Company drew down an additional $15 million for a total of $35 million outstanding. The 2018 Amended Facility extended the loan’s maturity date from May 1, 2020 until June 1, 2023. The interest-only period was initially extended from November 2018 to January 1, 2021 and was further extended to January 1, 2022 as a result of meeting the provision in the 2018 Amended Facility of raising more than $90.0 million in equity financing in September 2019. The Company is required to repay the facility in equal monthly installments of principal and interest between the end of the interest-only period and the maturity date. The interest rate continues to be adjustable and is the greater of (i) 8.85% and (ii) 8.85% plus the prime rate less 5.50% per annum.

Under the 2018 Amended Facility, the Company paid a facility fee of 0.50% of the $35 million outstanding as of signing and owes a back-end fee of 4.95% of the outstanding debt. In addition, in May 2020 the Company paid a back-end fee of $1.0 million in relation to the 2016 Amended Facility.

The amortized cost (including interest due presented as part of accrued expenses and other current liabilities) of the 2018 Amended Facility was $35.6 million as of June 30, 2020, compared to $36.3 million as of December 31, 2019, and is recorded net of discount and debt issuance costs. The foreign currency gain on the loan in the three and six months ended June 30, 2020, was $0.7 million and $0.0 million compared to a foreign currency gain of $0.5 million during the three months ended June 30, 2019, and a foreign currency loss of $0.2 million during the six months ended June 30, 2019.

Interest expense associated with the 2018 Amended Facility during the three and six months ended June 30, 2020 was $0.9 million and $1.8 million, respectively, compared to $0.9 million and $1.9 million during the same periods in 2019.

As a covenant in the 2018 Amended Facility, the Company has periodic reporting requirements and is required to keep a minimum cash balance deposited in bank accounts in the United States, equivalent to the lesser of (i) 65% of the outstanding balance of principal due or (ii) 100% of worldwide cash and cash equivalents. This restriction on cash and cash equivalents only relates to the location of the cash and cash equivalents, and such cash and cash equivalents can be used at the discretion of the Company. In combination with other covenants, the 2018 Amended Facility restricts the Company’s ability to, among other things, incur future indebtedness and obtain additional debt financing, to make investments in securities or in other companies, to transfer assets, to perform certain corporate changes, to make loans to employees, officers and directors, and to make dividend payments and other distributions. The Company secured the facilities by directly or indirectly pledging its total assets of $385.3 million with the exception of $110.0 million of cash and cash equivalents and other current assets held by uniQure N.V.

The 2018 Amended Facility contains provisions that include the occurrence of a material adverse effect, as defined therein, which would entitle Hercules to declare all principal, interest and other amounts owed by the Company immediately due and payable. As of June 30, 2020, the Company was in compliance with all covenants and provisions.