Item 1.01 Entry into a Material Definitive Agreement.
On November 1, 2021 (the "Closing Date"), G1 Therapeutics, Inc. (the "Company"),
as borrower, and Hercules Capital, Inc. and certain of its affiliates
(collectively, the "Lender") entered into a second amendment (the "Second
Amendment") to amend that certain loan and security agreement, dated as of
May 29, 2020, as amended by that certain First Amendment to Loan and Security
Agreement, dated as of March 31, 2021 (the "First Amendment"; and the loan and
security agreement, as amended by the First Amendment and the Second Amendment,
the "Loan and Security Agreement"), under which the Lender has agreed to lend
the Company up to $150.0 million, to be made available in a series of tranches,
subject to specified conditions. The Company borrowed an additional
$45.0 million on the Closing Date, which brings the total loan amount
outstanding to $75.0 million.
Under the terms of the Loan and Security Agreement, the Company has an option to
borrow up to an additional $25.0 million through September 15, 2022. A second
tranche (the "Second Tranche"), consisting of $20.0 million, will become
available to the Company for drawdown upon the Company's achievement of
$50,000,000 trailing six-month net product revenue of COSELATM no later than
June 30, 2023. The Second Tranche will be available, if specified conditions are
met, during the period beginning on the Closing Date through December 15, 2023.
A third tranche (the "Third Tranche") of $15.0 million will become available
upon achievement of certain development performance milestones. The Third
Tranche will be available to the Company through December 15, 2023. A fourth
tranche of $15.0 million will be available, at the Lender's option, in minimum
increments of $5 million through June 30, 2024.
The loan will mature on November 1, 2026. The Company may make payments of
interest only through December 1, 2024. Thereafter, the interest only period may
be extended through December 1, 2025, in quarterly increments, subject to
continued compliance with the covenants of the Loan and Security Agreement.
Amounts borrowed under the Loan and Security Agreement accrue interest at a rate
equal to the greater of either (A) (i) the prime rate as reported in The Wall
Street Journal, plus (ii) 5.90%, or (B) 9.15%.
The Company paid the Lender an upfront fee on the Closing Date in the amount of
$675,000. The Company may prepay all or a portion of the outstanding principal
amount under the Loan and Security Agreement subject to a prepayment fee
equaling a percentage of the amount to be prepaid, as follows: (A)(i) 3.0% of
the prepayment amount in the first year from the Closing Date; (ii) 2.0% of the
prepayment amount in the second year from the Closing Date; or (iii) 1.0% of the
prepayment amount thereafter, plus (B) a charge of 6.75% of the amount of the
loan being prepaid. The Company will be required to make a final payment to the
Lender in the amount of 6.75% of the aggregate amount of all loan advances, less
any amount previously paid. In addition, the Company will be required to make a
final payment to the Lender in the amount of $2,085,000 on the earliest
occurrence of (i) June 1, 2025, (ii) the date that the Company prepays the
outstanding principal amount under the Loan and Security Agreement in full, or
(iii) the date that the principal amount becomes due and payable in full.
As security for obligations arising under the Loan and Security Agreement, the
Company has granted the Lender a blanket lien on substantially all of the
Company's assets, including intellectual property, subject to certain
exemptions.
Under the Loan and Security Agreement, the Lender has the right to participate
in any equity offerings by the Company that are marketed to multiple investors
during the term of the loan under the Loan and Security Agreement in an amount
up to $5.0 million.
The Loan and Security Agreement contains a minimum revenue covenant. Beginning
August 15, 2022, with the reporting of the financial results for the second
fiscal quarter ended June 30, 2022, and tested monthly, the Company must have
achieved net product revenue of COSELA of at least 65% of the amounts projected
in the Company's forecast.
The foregoing description is only a summary of certain provisions of the Second
Amendment and is qualified in its entirety by reference to the Second Amendment,
a copy of which will be filed as an exhibit to the Company's Quarterly Report on
Form 10-Q for the quarter ending September 30, 2021 and will be incorporated by
reference herein.
--------------------------------------------------------------------------------
Item 2.02 Results of Operations and Financial Condition.
On November 3, 2021, the Company issued a press release announcing its financial
results for the third-quarter ended September 30, 2021. The full text of the
press release was posted on the Company's internet website and is furnished as
Exhibit 99.1 hereto and incorporated herein by reference.
Pursuant to General Instruction B.2 of Current Report on Form 8-K, the
information contained in, or incorporated into, Item 2.02, including the press
release attached as Exhibit 99.1, is being furnished and shall not be deemed
"filed" for the purposes of Section 18 of the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), or otherwise subject to the liabilities of that
section, nor shall it be deemed incorporated by reference into any registration
statement or other filing under the Securities Act of 1933, as amended, or the
Exchange Act, except as shall be expressly set forth by specific reference to
such filing.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information in Item 1.01 of this Current Report on Form 8-K is incorporated
by reference into this Item 2.03.
Item 9.01 Financial Statements and Exhibits.
Exhibit No. Description
99.1 Press Release dated November 3, 2021
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses