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Subsequent Events
12 Months Ended
Dec. 31, 2016
Subsequent Events [Abstract]  
Subsequent Events

Note 13. Subsequent Events

Facility Lease

Pursuant to the lease option that was exercised in May 2016 (see note 10), the Company entered into a long-term lease agreement with JCN Partners on January 7, 2017 to lease 39,599 square feet of manufacturing space in South San Francisco, a portion of which is currently subleased under an agreement with Solstice Neurosciences LLC. The long-term lease commences on June 1, 2017, terminates on May 31, 2027 and is extendible for two five year terms at the Company’s election. The total minimum lease commitment is $7.3 million.

Loan and Security Agreement

On March 7, 2017, the Company entered into a Loan and Security Agreement with Hercules Capital, Inc. (Hercules), which provides for a term loan (the Term Loan) in an aggregate principal amount of $20 million. Through September 15, 2017, the Company may draw up to an aggregate of $10 million, but cannot draw more than an aggregate of $5 million from June 15, 2017 to September 15, 2017. In addition, beginning on the date the Company initiates enrollment in Phase 1/2 clinical trials for AT132 and AT342 and continuing through December 15, 2017, it may draw up to an additional $10 million.

The Term Loan will bear interest at a rate equal to the greater of either (i) 7.95% plus the prime rate as reported in the Wall Street Journal minus 3.75%, and (ii) 7.95%. Upon repayment the Company will pay the greater of $200,000 or 5.40% of the aggregate amount of the term loans drawn under the agreement. The Term Loan matures on December 1, 2020. The Company shall begin to repay the aggregate principal amount that is outstanding in equal monthly installments of principal and interest beginning on July 1, 2018, or if certain clinical development or financing milestones are achieved, beginning on certain dates in 2019, until the Term Loan maturity The Company may voluntarily prepay the term loan, subject to a 2.0% premium for 12 months and a 1.0% premium after 12 months but prior to 24 months.  Certain mandatory prepayments are required upon a Change in Control. The Term Loan contains financial and other covenants. The Company’s obligations under the Term Loan are secured by substantially all of its assets, which do not include, among certain other items, the intellectual property of the Company.

In connection with the entry into the Loan Agreement, the Company issued a warrant to Hercules immediately exercisable for the number of shares of the Company’s common stock that is equal to the greater of (i) 3.0% of the aggregate amount of the term loan advances funded under the Loan Agreement or (ii) $150,000, in each case divided by the exercise price of $15.13 per share, subject to certain proportional adjustments.