NOTE 9 – DEBT



Long-term Debt

The mortgage on the Company’s headquarters building was payable in monthly installments and carried an interest rate of 6.83%.  The mortgage matured on March 1, 2016 and the Company made payments totaling $104,000 in the first quarter of 2016 to fully settle the liability. The mortgage was secured by the building.



Line of Credit

The Company has a $10,000,000 line of credit from Wells Fargo Bank.  The Company had $1,500,000 in outstanding borrowings against the line of credit at March 31, 2016 and no borrowings at March 31,  2015. Due to the revolving nature of loans under our credit facility, additional borrowings and periodic repayments and re-borrowings may be made until the maturity date. The total amount available for borrowings under our credit facility at March 31, 2016 was $8,500,000. Interest on borrowings on the credit line is at LIBOR plus 1.75%  (1.9% at March 31, 2016). The credit agreement expires October 31, 2016 and is secured by assets of the Company.  The Company has pledged $5.0 million in long term investments against the line of credit. Our credit agreement contains financial covenants including tangible net worth minimums and a minimum cash balance. The Company was in compliance with its financial covenants at March 31, 2016.