Term Notes

3 Months Ended

Mar. 31, 2022

Debt Disclosure [Abstract]

Term Notes

Term Notes

Loan and Security Agreement

In February 2020, the Company entered into a First Amendment to its Loan and Security Agreement with Silicon Valley Bank (the “Amended Credit Agreement”) to, among other things, refinance its existing term loan, which is accounted for as a modification of the Loan and Security Agreement. The Amended Credit Agreement provides the Company with a supplemental term loan in the amount of $16.5 million. The principal amount outstanding under the supplemental term loan accrues interest at a floating per annum rate equal to the greater of (a) the Prime Rate minus 1.25% and (b) 3.5%. The interest rate was 3.5% as of March 31, 2022.

The supplemental term loan matures on December 1, 2023. The Amended Credit Agreement provides an interest-only payment period through June 30, 2022.

The additional final payment for the Amended Credit Agreement is $1.6 million, which will be accrued over the term of the supplemental term loan using an effective interest rate that reflects the revised cash flows of the modified term loan.

The supplemental term loan is secured by all of the Company’s assets, excluding intellectual property and certain other assets. The loan contains customary affirmative and restrictive covenants, including with respect to the Company’s ability to enter into fundamental transactions, incur additional indebtedness, grant liens, pay any dividend or make any distributions to its holders, make investments, merge or consolidate with any other person or engage in transactions with the Company’s affiliates, but does not include any financial covenants.

Current and noncurrent debt and net discount or premium balances are as follows:

	March 31, 2022		December 31, 2021
	(in thousands)
Principal amount of term note	$	16,500	$	16,500
Net premium associated with accretion of final payment, and other debt issuance costs	783		630
Term note, current and noncurrent	17,283		17,130
Less term note, current portion	(8,250)		(5,500)
Term note, noncurrent portion	$	9,033	$	11,630