Note 9 - Note Payable Under Paycheck Protection Program

12 Months Ended

Dec. 31, 2020

(

)

Note payable under Paycheck Protection Program

May 1, 2020,

BioCardia Lifesciences, Inc. (the Borrower), a wholly owned subsidiary of BioCardia, Inc. (the Company), entered into a promissory note (the Note) with Silicon Valley Bank (the Lender) evidencing an unsecured loan in the aggregate principal amount of

$506,413

pursuant to the Paycheck Protection Program (the PPP) of the Coronavirus Aid, Relief, and Economic Security Act (CARES Act) administered by the U.S. Small Business Administration. All the funds under the Note were disbursed to the Borrower on

May 1, 2020.

In accordance with the requirements of the CARES Act, the Borrower used the proceeds from the Note in accordance with the requirements of the PPP to cover certain qualified expenses, including payroll costs, rent and utility costs. Interest accrued on the Note at the rate of

1.00%

per annum. The Borrower

may

apply for forgiveness of amount due under the Note, in an amount equal to the sum of qualified expenses under the PPP, which include payroll costs, rent obligations, and covered utility payments incurred during the

eight

weeks following disbursement under the Note. On

June 5, 2020,

the Paycheck Protection Flexibility Act extended the period for qualifying expenses from

eight

weeks to an optional

twenty-four

-week period.

Subject to any forgiveness under the PPP, the Note would have matured

two

years following the date of issuance of the Note and include a period for the

first

six

months during which time required payments of interest and principal would be deferred. On

October 7, 2020,

the Company applied for forgiveness of the note payable with the Lender. That application for forgiveness of

$506,000

and related interest payable of

$3,000

was approved in its entirety on

November 2, 2020.

Accordingly,

$509,000

is presented as a gain on extinguishment of Paycheck Protection Program note payable in the accompanying consolidated statements of operations for the year ended

December 31, 2020.