Quarterly report pursuant to sections 13 or 15(d)

Indebtedness

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Indebtedness
9 Months Ended
Jun. 30, 2011
Indebtedness  
Indebtedness

Note 5. Indebtedness:

The outstanding debt under the Company's various loan agreements is presented in the table below:

 

     Revolving
line of
credit
    Term note     Mortgage
note
payable
    All other      Total  

June 30, 2011

           

Principal balance outstanding

   $ 22,350      $ 40,000      $ 3,483      $ 16       $ 65,849   

Remaining available credit

   $ 37,650        —          —          —         $ 37,650   

Effective interest rate

     2.69     2.69     6.68     Various      

Scheduled maturity date

     Oct 2020        Oct 2020        Mar 2014        Various      

Collateral

     Real estate        Real estate        Real estate        Various      

September 30, 2010

   $              

Principal balance outstanding

   $ 29,000      $ 40,000      $ 4,433        27       $ 73,460   

Remaining available credit

   $ 31,000        —          —          —         $ 31,000   

Effective interest rate

     2.76     2.76     6.68     Various      

Scheduled maturity date

     Oct 2020        Oct 2020        Mar 2014        Various      

Collateral

     Real estate        Real estate        Real estate        Various      

Alico has a revolving line of credit and term note with Rabo AgriFinance, Inc. ("Rabo") for $100 million, and a mortgage with Farm Credit of Florida (formerly known as Farm Credit of Southwest Florida) ("Farm Credit"). The line of credit is collateralized by 44,277 acres of farmland, and the term note is collateralized by 12,280 acres of property containing approximately 8,600 acres of producing citrus groves. The mortgage is collateralized by 7,680 acres of real estate in Hendry County used for farm leases, sugarcane and citrus production.

 

The Term note requires quarterly payments of interest at a floating rate of LIBOR plus 250 basis points beginning October 1, 2010. Quarterly principal payments of $500 thousand, together with accrued interest, begin on October 1, 2011 and continue until October 1, 2020, when the remaining principal balance and accrued interest will be due and payable. The mortgage note requires monthly principal payments of $106 thousand plus accrued interest until maturity. At June 30, 2011 and September 30, 2010, Alico was in compliance with all of its covenants under the various loan agreements.

Maturities of the Company's debt at June 30, 2011 were as follows:

 

Due within 1 year

   $ 2,782   

Due between 1 and 2 years

     3,267   

Due between 2 and 3 years

     2,950   

Due between 3 and 4 years

     2,000   

Due between 4 and 5 years

     2,000   

Due beyond five years

     52,850   
        

Total

   $ 65,849   
        

Interest costs expensed and capitalized to property, buildings and equipment were as follows:

 

     Three months ended
June  30,
     Nine months ended
June  30,
 
     2011      2010      2011      2010  

Interest expense

   $ 502       $ 926       $ 1,572       $ 2,650   

Interest capitalized

     25         17         90         68   
                                   

Total interest cost

   $ 527       $ 943       $ 1,662       $ 2,718   
                                   

As an agricultural credit cooperative, Farm Credit is owned by the member-borrowers who purchase stock and earn participation certificates which represent each members-borrowers respective share of the allocated surplus in the cooperative. Allocations of the surplus are made to members on an annual basis according to the proportionate amount of interest paid by each member. Allocations are made in cash and non-cash participation certificates.

During the second quarter of 2011, the Company wrote-off $1.7 million in allocated surplus it had recorded, based on its patronage allocation with Farm Credit. Farm Credit did not make any distributions of allocated surplus during 2010 and subsequently announced in 2011 the indefinite suspension of any future distributions of members' allocated surplus; therefore, the Company determined that the entire amount was uncollectible as no future revolvement plan has been established. The write-off of the $1.7 million is included in interest and investment income, net, in the accompanying Condensed Consolidated Statements of Operations (Unaudited).