On June 5, 2020, contemporaneously with the completion of the Series B Financing, as described and defined in Note 10, Stockholders’ equity, the Company entered into a Credit Agreement, or the Credit Agreement, with Perceptive Credit Holdings III, LP, an affiliate of Perceptive Advisors LLC, or Perceptive, that provided for an aggregate principal borrowing amount of up to $20.0 million, available in two tranches of $12.5 million and $7.5 million. Perceptive is considered a related party to the Company based on its ownership of the Company’s common stock.

In June 2020, the Company drew down on the first tranche of $12.5 million, or the Term Loan, which is outstanding as of December 31, 2021. The Company elected not to draw down the second tranche, which expired on June 30, 2021. The Term Loan is secured by a lien on substantially all of the Company’s assets and bears interest at a variable rate using the greater of LIBOR or 1.75%, plus 9.50%. The interest rate was 11.25% as of December 31, 2021. When the LIBOR interest rate is discontinued in the future, it is expected that the interest rate of the Term Loan would switch to Secured Overnight Financing Rate, or SOFR. As of December 31, 2021, the effect of switching from LIBOR to SOFR would not have been material to the Company’s consolidated financial statements.

The Credit Agreement requires the Company to maintain a minimum aggregate cash balance of $3.0 million in one or more controlled accounts and contains various affirmative and negative covenants that limit its ability to engage in specified types of transactions.

The Company is required to make interest-only payments until December 5, 2022, after which point the Company will be required to make payments of principal equal to 2% of the Term Loan until maturity on June 5, 2024, or the Maturity Date. If the Company pays off the Term Loan prior to the Maturity Date, it will be required to pay a prepayment fee. As of December 31, 2021, the prepayment fee would be $2.9 million.

Under the terms of the Credit Agreement, Perceptive was issued a warrant to purchase up to 338,784 shares of the Company’s common stock at an exercise price of $8.86 per share. As further described in Note 10, Stockholders’ equity, in May 2021, Perceptive exercised its warrant using the net exercise method provided by the Credit Agreement.

The following table contains the anticipated future minimum payments on long-term debt as of December 31, 2021 for each of the years ending December 31 and a reconciliation to the carrying value of long-term debt on the Company’s consolidated balance sheets (in thousands):

Undiscounted, minimum long-term debt payments:
2022	$	—
2023		3,000
2024		9,500
Total minimum long-term debt payments		12,500
Less: Unamortized debt issuance costs and debt discount related to warrant		(1,732	)
Total long-term debt—related party as of December 31, 2021	$	10,768