Quarterly report pursuant to Section 13 or 15(d)

Notes Payable

v3.21.2
Notes Payable
 9 Months Ended
Aug. 31, 2021
Debt Disclosure [Abstract]  
Notes Payable

Note 5 – Notes Payable

On August 20, 2016, the Company entered into a Credit Agreement (“Agreement”) with Texas Capital Bank, National Association (“TCB”) for a term loan of $8.0 million in senior credit facilities.  The proceeds of the term loan were used by the Company to fund repurchases of the Company’s common stock.  Subject to the terms of the Agreement, on August 20, 2016, TCB advanced the Company $100.00.  On July 1, 2016, TCB advanced the remaining principal amount of $7,999,900 per a promissory note dated August 20, 2016 between the Company and TCB, at a rate of 3.75% per annum plus LIBOR, payable monthly with a maturity date of July 2021 extended to June 2022 with Second Amendment.  On August 26, 2016, the Company entered into a First Amendment to Credit Agreement with TCB.  Pursuant to terms of the First Amendment to Credit Agreement, on August 26, 2016, TCB made an additional advance to the Company in principal amount of $2,133,433 per an Amended and Restated Promissory Note dated August 26, 2016 between the Company and TCB.  The additional proceeds of the term loan were used by the Company to fund the extinguishment of revenue sharing agreements.  On June 11, 2018, the Company entered into a Second Amendment to Credit Agreement with TCB.  Pursuant to the terms of the Second Amendment to Credit Agreement, TCB increased the current outstanding principal amount of the loan from TCB by $9,000,000 to finance a portion of the purchase price of the Cord:Use Purchase.  In connection therewith, Cryo-Cell executed and delivered to TCB a Second Amended and Restated Promissory Note, in the principal amount of $15,500,000.  As of the three and nine months ended August 31, 2021, the Company paid interest of $25,862 and $99,294, respectively, which is reflected in interest expense on the accompanying consolidated statements of income.  As of the three and nine months ended August 31, 2020, the Company paid interest of $63,560 and $254,945, respectively, which is reflected in interest expense on the accompanying consolidated statements of income.  

Collateral of the term and subordinated loans includes all money, securities and property of the Company.

The Company incurred debt issuance costs related to the term loan in the amount of $548,085 which is recorded as a direct reduction of the carrying amount of the note payable and amortized over the life of the loan.  As of the three and nine months ended August 31, 2021, $12,390 and $47,462, respectively, of the debt issuance costs were amortized and are reflected in interest expense on the accompanying consolidated statements of income.   As of the three and nine months ended August 31, 2020, $20,193 and $67,012, respectively, of the debt issuance costs were amortized and are reflected in interest expense on the accompanying consolidated statements of income.  

As of August 31, 2021, and November 30, 2020, the note payable obligation was as follows:

 

 

 

August 31,

2021

 

 

November 30,

2020

 

Note payable

 

$

2,683,433

 

 

$

6,008,433

 

Unamortized debt issuance costs

 

 

(19,757

)

 

 

(67,219

)

Net note payable

 

$

2,663,676

 

 

$

5,941,214

 

 

 

 

 

 

 

 

 

 

Current portion of note payable

 

$

2,663,676

 

 

$

3,100,000

 

Long-term note payable, net of debt issuance costs

 

 

—

 

 

 

2,841,214

 

Total

 

$

2,663,676

 

 

$

5,941,214

 

 

 

Interest expense on the note payable for the three and nine months ended August 31, 2021 and August 31, 2020 was as follows:

 

 

 

For the three

months ended

August 31,

2021

 

 

For the nine

months ended

August 31,

2021

 

Interest expense on notes payable

 

$

25,862

 

 

$

99,294

 

Debt issuance costs

 

 

12,390

 

 

 

47,462

 

Total interest expense

 

$

38,252

 

 

$

146,756

 

 

 

 

For the three

months ended

August 31,

2020

 

 

For the nine

months ended

August 31,

2020

 

Interest expense on notes payable

 

$

63,560

 

 

$

254,945

 

Debt issuance costs

 

 

20,193

 

 

 

67,012

 

Total interest expense

 

$

83,753

 

 

$

321,957