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Notes Payable and Bank Debts
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9 Months Ended | ||||||||||||||||||||||||||||||||||||||||
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Sep. 30, 2014
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| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||
| Notes Payable and Bank Debts |
Notes Payable and Bank Debts
Bank loan
AIA had an unsecured four-year loan of $15.9 million from UniCredit Bank AG, Munich, Germany. The loan was subject to initial repayment of $0.7 million and thereafter regular half-yearly repayments of $2.2 million, no prepayment penalties and variable interest based on the six-month Euribor plus 2.35%. In order to avoid any exposure to the risk from rising interest rates associated with variable interest obligations, a portion of the variable interest payments was converted into fixed interest obligations by means of interest rate swaps over the term of the loan.
Under the terms of the loan agreement, mandatory special loan payments were required under certain conditions. The provision regarding mandatory special loan payments resulted in a mandatory special loan payment of $1.4 million on June 30, 2013. As a result, the repayment period and thus the loan would end six months earlier than originally envisioned. These special loan payments result in a reclassification of the amount of the special loan payments to the current portion of the loan as of December 31, 2013.
As of December 31, 2013, the principal and accrued interest outstanding on the bank loan was $3.4 million. As of September 30, 2014, there were no outstanding principal or accrued interest balance on the note.
Subordinated bank loan
AIA held a note payable of $2.6 million for mezzanine financing obtained through a financing program of Capital Efficiency Group AG, Zug, Switzerland. This financing program matured in March 2014. The interest rate was 8.8% per year. A payment of 1% had to be made each year and interest of 7.8% on the principal had to be paid every quarter. As of September 30, 2014, there were no outstanding principal or accrued interest balance on the note.
Bank Debt
With the acquisition of PMG in July 2013, the Company assumed approximately $3.3 million of debt in the form a $1.5 million term loan (the “Term Loan”) and a $1.8 million line of credit (the “LOC”) with a bank. The Term Loan and LOC mature in October 2017 and 2014, respectively, and bear interest at a rate equal to the bank’s reference rate, which was approximately 5.00% during the quarter ended September 30, 2014, or the bank’s current prime rate. The LOC matures in December 2014, and bears interest. Interest is paid on a monthly basis. Accrued interest on the Term Loan and LOC was $0.0 million at September 30, 2014. As of September 30, 2014, the principal balance outstanding on the Term Loan and the LOC were $1.1 million and $1.3 million respectively.
With the acquisition of IFES on October 18, 2013, the Company assumed approximately $1.3 million of debt in the form of two facility letters for a commercial mortgage loan with a bank for $0.2 million and $1.1 million. The mortgage letters mature in October 2014 and 2032, respectively, and bear interest at a rate equal to the bank’s base rate, which was approximately 3.25% during the year ended December 31, 2013. Interest is paid on a monthly basis. Accrued interest on the credit facilities was $0.0 million. As of September 30, 2014, there was $1.0 million in borrowings outstanding under facility letters.
The following is a schedule, by year, of future minimum principal payments required under notes payable and bank debts as of September 30, 2014 (in thousands):
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