AtriCure, Inc.ATRC
AtriCure, Inc. Debt Disclosure
BORROWINGS AND FINANCING OBLIGATION
The financing obligation is included in Other current liabilities and Other noncurrent liabilities on the Condensed Consolidated Balance Sheet.
Asset backed revolving credit facility. The Company has an asset-based credit agreement (Credit Agreement) among the Borrowers, JPMorgan Chase Bank, N.A., as administrative agent, and JPMorgan Chase Bank, N.A., as bookrunner and lead arranger (JPMCB), and Silicon Valley Bank, a Division of First-Citizen Bank & Trust Company, as Joint Lead Arrangers and Joint Bookrunners, and the lenders party thereto (Lenders). The Credit Agreement provides for an asset based revolving credit facility (ABL Facility) in an amount of up to $125,000. The Company may request an increase in the revolving commitment by up to $40,000 (not to exceed a total of $165,000). Borrowing availability under the ABL Facility is based on the lesser of $125,000 or a borrowing base calculation as defined by the Credit Agreement. A portion of the ABL Facility, limited to $5,000, is available for the issuance of letters of credit by JPMCB or other financial institutions. JPMCB in its sole discretion, may create swingline loans by advancing floating rate revolving loans requested. Any such swingline loans will reduce availability under the ABL Facility on a dollar-for-dollar basis.
At the initial closing, the Company borrowed $61,865. The proceeds of the ABL Facility were used to terminate the Company’s outstanding indebtedness and final fee under its then-existing Loan and Security Agreement with Silicon Valley Bank (SVB Loan Agreement). Certain prepayment and early termination fees under the SVB Loan Agreement were waived at termination. The SVB Loan Agreement terminated on January 5, 2024 and was treated as a debt extinguishment. The resulting loss on debt extinguishment is $1,362.
Through January 2025, the Company's required minimum utilization of the ABL facility was 40% of the aggregate revolving commitment or $50,000. This minimum utilization requirement was removed in connection with the First Amendment to Credit Agreement (as further described below). Subject to customary exceptions and restrictions, the Company may voluntarily prepay outstanding amounts under the ABL Facility at any time thereafter without premium or penalty. Any voluntary prepayments made will not reduce commitments under the ABL Facility. The Credit Agreement contains mandatory prepayment provisions which require prepayment of amounts outstanding under the ABL Facility upon specified events or Availability shortfall.
The ABL facility is subject to a commitment fee of 0.37% per annum of the daily available revolving commitment and paid on a quarterly basis. Outstanding amounts under the Credit Agreement bear interest at a rate per annum equal to, at the Company's election: (i) an alternate base rate (ABR) plus an applicable margin or (ii) an adjusted term secured overnight financing rate (SOFR) plus an applicable margin. All swingline loans bear interest at a rate per annum equal to the ABR plus the applicable margin under the Credit Agreement. Alternate base rate is equal to the greatest of Prime, the NYFRB Rate plus 0.50% and Adjusted Term SOFR Rate plus 1.00%. The applicable margin on borrowings will adjust ranging from 1.50% to 1.75% per annum for ABR borrowings and from 2.50% to 2.75% per annum for SOFR term borrowings determined by the average historical excess availability. Participation and fronting fees are accrued and paid on a quarterly basis. As of December 31, 2025, the effective interest rate on the ABL Facility was 6.59%.
The ABL Facility is secured by the assets of the Company, consisting of personal, tangible or intangible property, including certain outstanding equity interests of the Company’s direct subsidiaries, subject to limitations specified in the Credit Agreement. The Credit Agreement contains customary representations and warranties, events of default and financial, affirmative and negative covenants for facilities of this type, including but not limited to financial covenants relating to a fixed charge coverage ratio and a minimum excess availability requirement, and restrictions on indebtedness, liens, investments and acquisitions, asset dispositions, specified agreements, restricted payments and prepayment of certain indebtedness.
First Amendment to Credit Agreement. On January 9, 2026, the Company entered into a First Amendment to Credit Agreement (First Amendment). The First Amendment provides a three-year extension of the term of the Credit Agreement, and all outstanding borrowings are due upon maturity of the Credit Agreement on January 9, 2029. The First Amendment provides for a reduction in the overall interest rate on the loans under the ABL Facility. The applicable margin on borrowings will adjust ranging from 1.25% to 1.50% per annum for ABR borrowings and from 2.25% to 2.50% per annum for SOFR term borrowings determined by the average historical excess availability. The First Amendment removes the minimum utilization financial covenant in addition to certain other loan administration updates. At the time of closing, the Company paid down $865 of borrowings and had $62,750 available borrowing capacity under the ABL Facility. The First Amendment was treated as a debt modification. Borrowings outstanding under the existing Credit Agreement have been classified as long-term in the Consolidated Balance Sheet as of December 31, 2025.
Future maturities of debt, after consideration of the First Amendment to Credit Agreement on January 9, 2026, are projected as follows:
| 2026 | $ | — | |||
| 2027 | — | ||||
| 2028 | — | ||||
| 2029 | 61,000 | ||||
| 2030 | — | ||||
Total long-term debt, of which $61,000 is noncurrent. | $ | 61,000 | |||
Financing obligation. In August 2025, the Company transferred legal ownership of a building and certain real property on its corporate headquarters campus in Mason, Ohio for cash consideration of $6,250. Simultaneously, the Company entered into a contract to lease back the existing building and real property, as well as the planned building expansion space from the buyer-lessor. The buyer-lessor is financing the development and construction of the expansion of additional manufacturing and office space. During construction of the expansion, the Company will maintain occupancy and pay rent for the existing building. Upon construction completion, the expanded premises will be leased for fifteen years with three five-year options to renew. Annual rental payments will be calculated at an amount equal to 8% of the construction costs and will escalate 3% annually. Rental payments will be allocated between the existing and the expanded property based on the relative fair value upon construction completion. Expansion rental payments are projected to be $38,469 for the fifteen year lease term expected to begin during 2026. The classification of the lease related to the expansion will be assessed upon completion of construction. Rental payments will be finalized upon completion of the expansion construction. Estimated rental payments for the expansion over the next five annual periods are as follows:
| 2026 | $ | 1,034 | |||
| 2027 | 2,099 | ||||
| 2028 | 2,162 | ||||
| 2029 | 2,227 | ||||
| 2030 | 2,294 | ||||
The lease of the existing building and certain real property sold is a failed sale-and-leaseback as a result of finance lease classification. The Company established a financing obligation equal to the $6,250 cash proceeds received. The Company allocated projected rental payments during the term of construction and fifteen-year lease term based on the estimated fair value of the existing real property assets and future expansion. The company imputes interest monthly at a
rate of 6.76%. During the year ended December 31, 2025, interest expense was not significant. Future maturities of the financing obligation are projected as follows:
| 2026 | $ | 81 | |||
| 2027 | 128 | ||||
| 2028 | 152 | ||||
| 2029 | 180 | ||||
| 2030 | 209 | ||||
| 2031 and thereafter | 5,485 | ||||
Total long-term financing obligation, of which $81 is current | $ | 6,235 | |||
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 14, 2025 | |
| 2023 | Feb 16, 2024 | |
| 2022 | Feb 22, 2023 | |
| 2021 | Feb 17, 2022 | |
| 2020 | Feb 26, 2021 | |
| 2019 | Feb 24, 2020 | |
| 2018 | Mar 1, 2019 | |
| 2017 | Feb 28, 2018 | |
| 2016 | Mar 8, 2017 | |
| 2015 | Feb 29, 2016 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.