Loans and Convertible Notes Payable
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| December 31, 2024 | | December 31, 2023 |
| (In thousands) | Gross | | Discount | | Net | | Gross | | Discount | | Net |
Loans payable, current1 | $ | — | | | $ | — | | | $ | — | | | $ | 5,610 | | | $ | (371) | | | $ | 5,239 | |
| Convertible notes payable - current | — | | | — | | | — | | | 5,000 | | | (89) | | | 4,911 | |
| Total - Loans and notes payable | $ | — | | | $ | — | | | $ | — | | | $ | 10,610 | | | $ | (460) | | | $ | 10,150 | |
[1]The gross amount for December 31, 2023 included the 4.25% final payment of $0.5 million.
Term Loan from Avenue Venture Opportunities Fund, L.P.
On August 6, 2021, the Company entered into a Loan and Security Agreement (the “Avenue Loan Agreement”) with Avenue Venture Opportunities Fund, L.P. (the “Lender,” or “Avenue”) for a term loan in an aggregate principal amount of up to $20.0 million (the “Avenue Loan”). The Avenue Loan bore interest at an annual rate equal to the greater of (a) the sum of 7.70% plus the prime rate as reported in The Wall Street Journal and (b) 10.95%.
On March 31, 2023, the Avenue Loan Agreement was amended (the “Avenue Amendment”) to defer the interest only period to September 30, 2023, with an additional extension option upon FDA Approval for the HEPZATO KIT and subsequent receipt of at least $10 million from the sale and issuance of equity securities.
In connection with the initial entry into the Avenue Loan Agreement, the Company issued warrants to Avenue (the “Initial Avenue Warrant”) to purchase 127,755 shares of common stock at an exercise price per share equal to $0.01. Additionally, in connection with the Avenue Amendment, the Company issued to Avenue a warrant to purchase 34,072 shares of common stock at an exercise price per share equal to $0.01. Avenue exercised all outstanding warrants connected to the Avenue Loan in full in April 2024.
The Company determined that the embedded conversion option associated with the Avenue Loan did not require bifurcation and met the criteria for equity classification. In addition, the amendment was recorded under debt modification guidance. Aggregate debt discount amortization of $0.5 million and $0.8 million was recorded for the years ended December 31, 2024 and 2023, respectively. Interest expense incurred was $0.4 million and $1.5 million for the years ended December 31, 2024 and 2023, respectively. The Avenue Loan matured on August 1, 2024 with a 16.20% rate at maturity. Avenue did not exercise its option to convert the principal amount of the Avenue Loan into shares of the Company’s common stock.
Convertible Notes Payable
The Company had $2.0 million of principal outstanding related to Senior Secured Promissory Notes (the “Rosalind Notes”) which bore interest at 8% per annum. Pursuant to their original terms, the Rosalind Notes were convertible into Series E Preferred Stock at a price of $1,500 per share and were to mature on July 16, 2021.
On August 6, 2021, the Company executed an agreement to amend the Rosalind Notes to (i) reduce the conversion price to $1,198 per share of the Company’s Series E Convertible Preferred Stock; and (ii) extend the maturity date to October 30, 2024. In addition, the holders of the Rosalind Notes agreed to subordinate all of the Company’s indebtedness and obligations to Avenue and all of the holders’ security interest, to the Avenue Loan and Avenue’s security interest in the Company’s property.
The outstanding principal and accrued interest was paid on October 30, 2024. Rosalind did not exercise its option to convert the Rosalind Notes into shares of the Company’s common stock.
Interest expense relating to the Rosalind Notes was $0.1 million and $0.2 million for the years ended December 31, 2024 and 2023, respectively.