Item 2.03. Creation of a Direct Financial Obligation or an Obligation Under an
Off-Balance Sheet Arrangement of a Registrant.
On May 14, 2021, Molecular Templates, Inc. (the "Company") through Molecular
Templates OpCo, Inc., as borrower, drew down an additional $20 million (the
"Second Tranche") pursuant to its previously disclosed Loan and Security
Agreement with K2 HealthVentures LLC, as administrative agent for Lenders, the
lenders from time to time party thereto, and Ankura Trust Company, LLC, as
collateral agent for Lenders, dated May 21, 2020 (the "K2 Loan and Security
Agreement"). The K2 Loan and Security Agreement consists of a total potential
borrowing capacity of $45 million, drawable in three tranches subject to the
satisfaction of the terms and conditions therein. The first tranche of
$15 million was drawn at the initial closing on May 21, 2020. The Second Tranche
consists of $20 million, and was drawable between March 1, 2021 and June 30,
2021, at the Company's option, subject to the achievement of certain clinical
milestones. The Company has achieved these milestones and has drawn the Second
Tranche. Pursuant to the terms of the K2 Loan and Security Agreement, the
principal accrues interest at an annual rate equal to the greater of 8.45% or
the sum of the Prime Rate plus 5.2%. Monthly payments commenced on July 1, 2020
and payments will be interest only until July 1, 2023. Thereafter, the loan
shall amortize monthly such that the principal amount of the loan and interest
accrued thereon shall be fully amortized by the loan's maturity date of June 1,
2024.
The description of the K2 Loan and Security Agreement in Item 1.01 of the
Company's Current Report on Form 8-K filed on May 22, 2020 is incorporated
herein by reference. The foregoing description of the K2 Loan and Security
Agreement does not purport to be complete and is qualified in its entirety by
reference to the K2 Loan and Security Agreement, which is filed as an exhibit to
the Company's Current Report on Form 8-K filed on May 22, 2020.
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