8-KMaterial AgreementsFinancial EventsExhibits & Filings

DEXCOM INC 8-K Report, Material Agreement (Feb 5, 2008)

Filed February 5, 2008For Securities:DXCM

Summary

DexCom, Inc. (DXCM) filed a Form 8-K on February 5, 2008, reporting a material definitive agreement related to its financing. The company entered into a First Amendment to its Loan and Security Agreement with Square 1 Bank on January 31, 2008. This amendment allows DexCom to draw an additional $3 million under a new Facility B Equipment Line, increasing the total potential borrowing capacity under the original agreement. The new facility has an interest rate tied to the prime rate plus a 0.25% margin and matures in July 2011. As part of the agreement, DexCom continues to grant Square 1 Bank a security interest in substantially all of its personal property as collateral.

Key Highlights

  • 1DexCom, Inc. secured an additional $3 million in financing through an amendment to its existing Loan and Security Agreement with Square 1 Bank.
  • 2The new financing is structured as a Facility B Equipment Line.
  • 3The amendment was dated January 31, 2008, and reported in an 8-K filing on February 5, 2008.
  • 4The new facility carries an interest rate of prime rate plus 0.25%.
  • 5The maturity date for the Facility B Equipment Line is July 31, 2011.
  • 6The company grants a security interest in substantially all of its personal property as collateral to Square 1 Bank for the loan.
  • 7The agreement includes various covenants and restrictions on the company's operations and financial activities.

Frequently Asked Questions

The primary purpose of the amendment is to allow DexCom to access an additional $3 million in debt financing through a new Facility B Equipment Line from Square 1 Bank, thereby increasing its available capital.

The new Facility B Equipment Line allows DexCom to borrow up to $3 million. It bears an interest rate of the prime rate plus 0.25% and matures on July 31, 2011.

DexCom continues to grant Square 1 Bank a security interest in substantially all of its personal property as collateral for the loan, which includes the newly available funds.

Yes, the agreement imposes several limitations on DexCom, including restrictions on transferring business assets, engaging in new business lines, merging, incurring additional debt, creating liens, paying dividends, acquiring other companies, transacting with affiliates, making payments on subordinated debt, and storing collateral with third parties without proper notification to the lender.