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Long-term debt and warrant – related party
12 Months Ended
Dec. 31, 2023
Debt Disclosure [Abstract]  
Long-term debt and warrant – related party Long-term debt and warrant – related party
Long-term debt – related party consisted of the following (in thousands):
December 31,
2022
Term Loan — related party, net of unamortized debt issuance costs and debt discount of $1,018 at December 31, 2022
$11,482 
Less: current portion2,287 
Total long-term debt — related party, net of current and discount9,195 
On June 5, 2020, contemporaneously with the completion of its Series B Financing, 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 was considered a related party to the Company based on its ownership of the Company’s common stock at inception of the Credit Agreement.
In June 2020, the Company drew down on the first tranche of $12.5 million, or the Term Loan. The Company elected not to draw down the second tranche, which expired on June 30, 2021.
On May 17, 2023, the Company entered into an amendment to the Credit Agreement pursuant to which the Company and its lender agreed to replace the LIBOR benchmark with SOFR, which is regulated by the Federal Reserve Bank of New York. The Company amended its Credit Agreement due to the Financial Conduct Authority's planned phase-out of LIBOR on June 30, 2023. The use of the SOFR rate became effective as of July 1, 2023.
In July 2023, the Company's obligation to pay a prepayment fee was extinguished based on the terms of the Credit Agreement. On July 26, 2023, the Company elected to repay the remaining outstanding principal balance on the Term Loan. In connection with the repayment of the outstanding balance on the Term Loan, the liens on substantially all of the Company's assets were released. The Company incurred a $0.6 million loss on the extinguishment of this debt for the year ended December 31, 2023.
Interest expense for the years ended December 31, 2023 and 2022, was $1.0 million and $1.5 million.