CareDx announced it entered into a secured facility for an aggregate $20 million, issuable in two tranches, with East West Bank. The facility replaces a prior facility from Oxford Finance and Silicon Valley Bank that was set to expire in 2016, which had approximately $10 million in remaining principal outstanding.

Under the terms of the loan agreement, $20 million is available in two tranches, $16 million at closing, with an additional $4 million available if certain financial conditions are maintained during the initial six month period. The loan is secured by the tangible assets of the company, and carries an initial annual interest rate of 5.25% that floats with the lender’s Prime Rate. There are no pre-payment or final payment fees associated with the loan. The facility matures in December 2018. CareDx has also issued East West Bank a warrant to purchase 34,483 shares of the company’s common stock with an exercise price of $6.96 and a term of five years. Additional warrants will be issued to East West Bank if the second tranche is drawn, consistent with the warrant formula applicable to the initial tranche.

“Our new credit facility is larger than our previous loan, carries minimal financial covenants and provides greater flexibility for us in the future. In addition, it will add six to ten million dollars to our balance sheet, strengthening our financial position. We are pleased to be working with East West Bank,” stated CareDx president and CEO Peter Maag.

“We are pleased to provide this loan to an innovation leader like CareDX to help them achieve their growth plans in the coming years,” stated Mark Horn, senior managing director, technology, private equity and life sciences at East West Bank. “This is another example of how our life science team at East West Bank can be an effective financial partner for leading edge technology-rich companies.”

Armentum Partners served as advisor to CareDx for this financing. Armentum has advised on more than 40 debt or royalty transactions in the past 12 months representing roughly $1 billion in committed capital.

Brisbane, CA-based CareDx is a molecular diagnostics company focused on the discovery, development and commercialization of clinically differentiated, high-value, non-invasive diagnostic surveillance solutions for transplant recipients.