6. Term Loan

On February 5, 2016, we entered into a loan and security agreement with Hercules Technology Growth Capital, Inc. ("HTGC"), as administrative agent and lender, and Hercules Technology III, L.P., as lender, pursuant to which the lenders agreed to make available long-term loans in an aggregate principal amount of up to $40 million, subject to certain conditions. The lenders made an initial term loan to the Company on February 8, 2016 in the aggregate principal amount of $25 million. If we announce 1/ positive data from our ongoing Phase 3 clinical trial of aldoxorubicin for the treatment of soft tissue sarcoma and 2/ also demonstrate continued progress in the development of a second novel drug candidate based on our LADR technology platform such that a clinical trial ins initiated under an Investigational New Drug Application prior to December 31, 2016, which we refer to as "milestones," we may request an additional term loan in an aggregate principal amount of up to $15 million no later than December 31, 2016, or such later date that HTGC otherwise determines in its sole discretion.

The term loans bear interest at the daily variable rate per annum equal to 6.00% plus the prime rate, or 9.5%, whichever is greater. We are required to make interest-only payments on the term loans through February 28, 2017, and beginning on March 1, 2017 we will be required to make amortizing payments of principal and accrued interest in equal monthly installments until the maturity date of the term loans. If we achieve the milestone as it relates to the Phase 3 clinical trial of aldoxorubicin, the interest-only payment period will be extended through August 31, 2017, and if any additional term loan is extended by the lenders, the interest-only payment period will be extended through February 28, 2018. Under the terms of the loan, we are required to maintain a minimum cash balance equal to the greater of (i) $10 million or (ii) forward three months projected cash burn. In connection with the loan and security agreement, we issued to the lenders warrants to purchase a total of 634,146 shares of our common stock at an exercise price of $2.05. These warrants are classified as equity warrants with a fair value of $633,749. All outstanding principal and accrued interest on the term loans will be due and payable in full on the maturity date of February 1, 2020.

As security for our obligations under the loan and securities agreement, we granted HTGC, as administrative agent, a security interest in substantially all of our existing and after-acquired assets except for our intellectual property and certain other excluded assets

	March 31, 2016
Term Loan Principal - Current	$	616,102
Issuance Cost - Current		(13,031)
Loan Discount - Current		(68,929)
Term Loan, Net - Current	$	534,142

Long Term Loan Principal	$	24,383,898
End Fee Payable		1,771,250
Long Term Issuance Cost		(515,749)
Long Term Loan Discount		(2,728,062)
Long Term Loan, Net	$	22,911,337

The interest expense on the Term loan for the three-month period ended March 31, 2016 was $416,803 and zero for the 2015 comparative period