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HYPERION THERAPEUTICS INC FILES (8-K) Disclosing Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant, Financial Statements and Exhibits

July 21, 2014



Item 1.01. Entry into a Material Definitive Agreement.

On July 18, 2014, Hyperion Therapeutics, Inc. (the "Company") entered into a Loan and Security Agreement (the "Loan Agreement") with Silicon Valley Bank (the "Bank"), providing for two tranches of term loans of up to $16 million (the "Term Loans") and a revolving credit line of up to $5 million (the "Revolving Loans" and together with the Term Loans, the "Loans"). The Company drew down both tranches of the Term Loans at closing, of which approximately $5.8 million was used to pre-pay the Company's existing term loan. The actual amount of Revolving Loans that are available from time to time under the Loan Agreement is limited to a borrowing base amount that is determined according to, among other things, a percentage of the value of eligible accounts.

The Company's obligations under the Loan Agreement are secured by a first priority security interest in substantially all of the Company's assets, excluding its intellectual property. The Company has also agreed not to pledge or otherwise encumber its intellectual property assets, except that the Company may grant licenses of its intellectual property as set forth in the Loan Agreement.

The Company is required to pay interest only for the first 18 months of the Term Loans, followed by 30 equal monthly payments of interest and principal. The Term Loans will mature on June 30, 2018. The Revolving Loans will mature on July 18, 2017. The Loan Agreement provides for an interest rate of 4% per year on the Term Loans and the prime rate plus 0.75% per year on the Revolving Loans, with a minimum interest requirement on the Revolving Loans. Upon the maturity date of the Term Loans, a final payment fee of 6.75% of the original principal amount of such Term Loans (the "Final Payment") will be due.

The Loan Agreement contains customary representations, warranties and covenants (including the requirement to meet one of two financial covenants) by the Company, as well as customary events of default and indemnification obligations of the Company. Upon an event of default, after any applicable grace or cure period, all amounts owed under the Loan Agreement may be declared due and payable, including the original principal amount of the Loans, the accrued but unpaid interest thereon, the Final Payment and the prepayment fee. The description above is a summary only of the provisions of the Loan Agreement and is qualified in its entirety by the terms of the Loan Agreement attached as Exhibit 10.1 hereto.

Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an

Off-balance Sheet Arrangement of a Registrant.



The information set forth 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.

(d) Exhibits. Exhibit No. Description 10.1 Loan and Security Agreement, dated as of July 18, 2014, by and between Silicon Valley Bank and Hyperion Therapeutics, Inc.



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Source: Edgar Glimpses


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