aibioInvivyd signs term loan facility of up to $30 million with Silicon Valley Bank
Tickers IVVD
Silicon Valley Bank, a division of First-Citizens Bank & Trust Company, can lend Invivyd up to $30 million in three tranches. Only the first $10 million is open without revenue milestones, and the loans are due March 1, 2029.
Key facts
- Company
- Invivyd, Inc. (NASDAQ: IVVD)
- News type
- Debt Financing
- Primary source
- Invivyd, Inc. Form 8-K filed April 21, 2025 (SEC EDGAR)
Invivyd, Inc. (Nasdaq: IVVD) entered into a Loan and Security Agreement on April 18, 2025 with Silicon Valley Bank, a Division of First-Citizens Bank & Trust Company, as lender. The agreement provides a senior secured term loan facility of up to $30 million. The company disclosed it in a Form 8-K filed April 21, 2025.
The company's press release calls the facility non-dilutive. It is secured debt, though. The loans are secured by a pledge of substantially all of the company's assets, excluding intellectual property, and they carry fees and covenants.
The three tranches
Term A Loans of up to $10 million can be drawn from August 15, 2025 through December 31, 2026, if the company complies with certain financial covenants and conditions. Term B Loans and Term C Loans, each up to $10 million, can be drawn only after the company reaches certain net product revenue milestones, and no later than June 30, 2027. The proceeds may be used for working capital and general business purposes.
The filing does not say whether any milestone has been reached or when the company expects to reach one.
Interest, repayment and fees
The loans are due on March 1, 2029. Interest is payable monthly in arrears at the greater of the Wall Street Journal prime rate minus 0.25%, subject to a 9.00% cap, and 6.00%.
Principal repayment starts on April 1, 2027, in 24 equal monthly installments. If the company reaches certain net product revenue milestones, that start date can move to April 1, 2028, with repayment over 12 installments. At maturity, or on earlier prepayment, the company must pay a final payment fee of 4.50% of the principal advanced.
An unused term loan commitment fee of 1.00% of the facility is payable on the earliest of July 1, 2027, an event of default, or termination. The lender will waive it if the company has requested loans and the lender has funded some before that date. Voluntary prepayment must be of the whole facility, not part of it. The premium is 3.0% of principal outstanding through the first anniversary of closing, 2.0% through the second, 1.0% through the third, and nothing after that.
Covenants
The agreement contains customary limits on additional debt, liens, investments, acquisitions, mergers, asset sales, dividends and affiliate transactions. It also requires quarterly financial covenants. From the quarter after any loan is advanced, the company must maintain a minimum amount of net product revenue. From the quarter ending December 31, 2025, or earlier if more than $15 million has been advanced, it must also meet either a minimum EBITDA or a minimum unrestricted cash balance. That cash test is tied to six months of cash burn and to the loans outstanding.
A going-concern warning and reliance on one product
The annual report for 2024 says the company's financial condition raises substantial doubt about its ability to continue as a going concern. It says Invivyd is highly dependent on the commercial success of PEMGARDA. Its net losses were $169.9 million for 2024 and $198.6 million for 2023. The accumulated deficit was $902.0 million at December 31, 2024.
The same report describes a Controlled Equity Offering Sales Agreement signed in December 2023 with Cantor Fitzgerald & Co. as sales agent, for up to $75.0 million of common stock. To date, the company had sold 9,000,000 shares under it, for net proceeds of $39.3 million.
Advisers and counsel
The 8-K names the lender and no placement agent, underwriter or financial adviser. The loan agreement refers to a legal opinion from borrower's counsel but does not name that firm.
What the loan changes
The loan adds up to $30 million of secured debt with a floor rate of 6.00%, a final fee and a minimum cash test. The first $10 million does not depend on revenue milestones, but it does depend on covenant compliance. The loan does not alter the going-concern language in the annual report, which predates it. The company's own press release calls the loan non-dilutive. That is accurate only in the narrow sense that it sells no shares, since the loan is secured on substantially all assets and carries a minimum cash test.