Note 5 - Senior Credit Facility

9 Months Ended

Sep. 30, 2019

Notes to Financial Statements

Debt Disclosure [Text Block]

Note

5

- Senior Credit Facility

On

February 5, 2019,

the Company entered into a

$100,000

Senior Credit Facility with an affiliate of MidCap Financial Services, LLC, as administrative agent (the “Second Amended and Restated Senior Credit Facility”). Borrowings under the Second Amended and Restated Senior Credit Facility will be available in

three

tranches, with (i) the

first

tranche comprised of

$50,000

funded at closing, which includes

$30,000

of proceeds that were deemed rolled over from the outstanding principal amount under the Company’s prior credit agreement, (ii) the

second

tranche to be comprised of

$30,000,

and (iii) the

third

tranche to be comprised of

$20,000,

with the

second

and

third

tranches to be funded upon the completion of certain contingencies related to the Company’s development activities of its product candidates and the establishment of certain financial covenants. The Second Amended and Restated Senior Credit Facility refinanced and replaced the Amended and Restated Senior Credit Facility dated as of

July 20, 2018 (

the “Amended and Restated Senior Credit Facility”). The Second Amended and Restated Senior Credit Facility bears a variable interest rate of LIBOR (which shall

not

be less than

0.5%

) plus

8%.

The Second Amended and Restated Senior Credit Facility includes an interest-only payment period through

June 2020

and scheduled monthly principal and interest payments for the subsequent

30

months. The Company used a portion of the proceeds of the Second Amended and Restated Senior Credit Facility to pay off outstanding amounts under the Amended and Restated Senior Credit Facility and the remainder will be used for general corporate purposes. Under the Second Amended and Restated Senior Credit Facility, the Company must maintain a minimum cash balance of

$25,000

of unrestricted cash at all times. The Company has access to an additional

second

tranche of

$30,000

based upon satisfying the positive APeX-

2

contingency, and if it does, the unrestricted cash balance minimum increases to

$40,000.

As of

September 30, 2019,

the Company had borrowings of

$50,000

under the Second Amended and Restated Senior Credit Facility bearing an interest rate of

10.1%.

The carrying amount of the debt approximates its fair value based on prevailing interest rates as of the balance sheet date. The remaining scheduled principal repayments of the Second Amended and Restated Senior Credit Facility are as follows:

Principal Payments
2020	$	10,000
2021		20,000
2022		20,000
Total	$	50,000

The debt agreement contains

two

provisions that if deemed probable would create the recognition of an embedded feature; however, we have determined that neither provision is probable.