XML 43 R12.htm IDEA: XBRL DOCUMENT v2.4.0.6
Debt
3 Months Ended
Mar. 31, 2013
Debt Disclosure [Abstract]  
Debt

6. Debt

Loan and Security Agreement

On June 7, 2012, the Company entered into a credit facility with MidCap, which permits the Company to borrow up to $50 million. The Credit Facility is due in June 2015 and consists of a revolving line of credit with a maximum borrowing base of $40 million, with the option to increase the maximum borrowing base to $50 million with the prior written consent of MidCap. The borrowing base is determined, from time to time, based on the value of domestic and foreign eligible accounts receivable and domestic eligible inventory. As collateral for the Credit Facility, the Company granted MidCap a security interest in substantially all of its assets, including all accounts receivable and all securities evidencing its interests in its subsidiaries. The revolving line of credit carries an interest rate equal to the London Interbank Offered Rate (“LIBOR”) plus 6.0%, which was 6.2% at March 31, 2013.

The Credit Facility includes traditional lending and reporting covenants including a fixed charge coverage ratio and a senior leverage ratio to be maintained by the Company. The Credit Facility also includes several potential events of default, such as payment default and insolvency conditions, which could cause interest to be charged at a rate which is up to five percentage points above the rate effective immediately before the event of default or result in MidCap’s right to declare all outstanding obligations immediately due and payable. In January 2013, the Company entered into a limited waiver and limited consent agreement with MidCap (the “Waiver”). The Waiver gave the Company consent on certain provisions under the Credit Facility related to the acquisition of Phygen and maintenance of cash balances in the U.S. In February 2013, the Company and MidCap entered into a first amendment to the Credit Facility (the First Amendment”). The First Amendment allows the Company to exclude payments related to the Phygen acquisition and the settlement agreement with Cross Medical Products, LLC (“Cross”) from calculation of the fixed charge coverage ratio and the senior leverage ratio. In conjunction with the First Amendment, the Company paid MidCap a fee of $0.1 million. The Company was in compliance with all of the covenants of the Credit Facility as of March 31, 2013.

Principal payments on debt are as follows as of March 31, 2013 (in thousands):

 

Year Ending December 31,

      

Remainder of 2013

   $ 859   

2014

     —    

2015

     39,352   

2016

     —    

2017

     —    

Thereafter

     —    
  

 

 

 

Total

     40,211   

Add: capital lease principal payments

     1,644   
  

 

 

 

Total

     41,855   

Less: current portion of long-term debt

     (1,277
  

 

 

 

Long-term debt, net of current portion

   $ 40,578