Note 8. Debt

Debt at June 30, 2015, consisted of the following (in thousands):


	June 30, 2015
	Principal			Unamortized Discount			Total
Loan and Security Agreement	$	20,000		$	(106	)	$	19,894
Less: debt—current		(2,568	)		45			(2,523	)

Debt—non-current	$	17,432		$	(61	)	$	17,371

Debt at December 31, 2014, consisted of the following (in thousands):


	December 31, 2014
	Principal		Unamortized Discount			Total
Loan and Security Agreement	$	10,000	$	(128	)	$	9,872
Less: debt—current		—		—			—

Debt—non-current	$	10,000	$	(128	)	$	9,872

Principal and interest payments on debt at June 30, 2015, are expected to be as follows * (in thousands):


Year ended December 31,	Principal		Interest		Total
2015	$	—	$	640	$	640
2016		5,226		1,231		6,457
2017		5,603		854		6,457
2018		6,007		450		6,457
2019		3,164		1,465		4,629

Total	$	20,000	$	4,640	$	24,640

*	Unless interest only period extends to December 31, 2016, as described below.

Loan and Security Agreement

On June 30, 2014, the Company entered into a five year loan and security agreement with Oxford Finance LLC (the “Term Loan Agreement”) to borrow up to $30.0 million in term loans in three equal tranches (the “Term Loans”). On June 30, 2014, the Company received $10.0 million from the first tranche (“Term Loan A”). The second tranche of $10.0 million (“Term Loan B”) was drawn on June 15, 2015. The third tranche of $10.0 million (“Term Loan C”) will be available from July 1, 2015 through December 31, 2015, contingent upon the Company achieving trailing six months’ revenue at a specified threshold (the “Revenue Event”). Term Loan A bears an interest rate of 6.95%. Term Loan B bears an interest rate of 7.01%. Term Loan C will bear an interest rate calculated at the greater of 6.95% or 6.72% plus the three month U.S. LIBOR rate in effect three business days prior to the funding date. All of the Term Loans mature on June 1, 2019. The Company is required to make interest only payments through December 2015 followed by forty-two months of equal principal and interest payments thereafter; however, if the Revenue Event is achieved no later than November 30, 2015, then the interest-only period may be extended through December 31, 2016, and the amortization period will be reduced to thirty months. The Company is also required to make a final payment equal to 7% of the principal amounts of the Term Loans drawn payable on the earlier to occur of maturity or prepayment. The costs associated with the final payment are recognized as interest expense over the life of the Term Loans. The Company may prepay at any time the Term Loans subject to declining prepayment fees over the term of the Term Loan Agreement. The Company pledged all current and future assets, excluding its intellectual property and 35% of the Company’s investment in its subsidiary, Cerus Europe B.V., as security for borrowings under the Term Loan Agreement. The Term Loan Agreement contains certain nonfinancial covenants, with which the Company was in compliance at June 30, 2015.