DEBT

Term Loans— On October 3, 2016, the Company entered into a loan and security agreement, (the "Loan Agreement"), with Pacific Western Bank, as the collateral agent and a lender (the "Lender"), pursuant to which the Lender agreed to lend to the Company up to $20.0 million in a series of term loans. Contemporaneously, the Company borrowed $10.0 million from the Lender (the "Term A Loan").

Under the terms of the Loan Agreement, because the Company achieved of positive Phase 2 clinical results from the STRIVE Phase 2 clinical trial of rezafungin by March 31, 2018 (the "Milestone"), the Company may, at its sole discretion through October 3, 2018, borrow from the Lender up to an additional $10.0 million (the "Term B Loan," and together with the Term A Loan, the "Term Loans"). Upon the occurrence of certain events, including but not limited to the Company’s failure to satisfy its payment obligations under the Loan Agreement, the breach of certain of its other covenants under the Loan Agreement, including any future milestone put into place to replace the Milestone, or the occurrence of a material adverse change, the collateral agent will have the right, among other remedies, to declare all principal and interest and other amounts due to the Lender under the Loan Agreement immediately due and payable.

The Company’s obligations under the Loan Agreement are secured by a first priority security interest in substantially all of the Company’s current and future assets, other than its intellectual property, which is subject to a double negative pledge.

The Term Loans mature on October 3, 2020 (the "Maturity Date"). Payments under the Term Loans will be interest-only through October 2, 2018, which includes an extension of six months which was triggered when the Milestone was achieved. The interest-only period will be followed by 24 monthly payments of principal and interest. The Term Loans will bear interest at a variable annual rate equal to the greater of (i) 4.5% or (ii) the Lender’s prime interest rate plus 1.0%. At March 31, 2018, the Term Loans bear interest at 5.75%.

As of March 31, 2018, future principal payments due under the Term A Loan are as follows (in thousands):



Year ended:
December 31, 2018	$	833
December 31, 2019	5,000
December 31, 2020	4,167
Total future principal payments due under the Term A Loan	$	10,000