9. LONG TERM DEBT

12 Months Ended

Dec. 31, 2015

Notes to Financial Statements

9. LONG TERM DEBT

9.           Long Term Debt

(a)Flexible Solutions Ltd. had received a non-interest bearing loan from the Department of Agriculture and Agri-Food Canada (“AAFC”).  Eligible for up to $1,000,000 in Canadian funds, the Company had borrowed $910,801 in Canadian funds (US$658,054) as of December 31, 2015 on an unsecured basis (2014 - CDN$910,801; US$785,106).  The final loan payment was made in 2015.  The amount due at December 31, 2015 was nil (2014: CDN$182,160 ; US$157,021).

(b)           Flexible Solutions Ltd. has also received a 5% simple interest loan from Agriculture Financial Services Corp. (“AFSC”).  Eligible for up to $2,000,000 in Canadian funds, the Company had originally borrowed $1,491,000 in Canadian funds.  The Company was required to make interest payments until May 1, 2010 and then started to pay down the principal in equal payments until April 1, 2015.  The borrowing balance as December 31, 2013 was $1,016,056 in Canadian funds (US$955,296).  The Company had pledged the assets of the Taber, AB building, including equipment, inventory and accounts receivable as collateral, as well as signed a promissory note guaranteeing the amount of the loan.  The Company repaid this loan in full in September 2014.

(c)           In September 2014, NanoChem Solutions Inc. signed a US$1,005,967 promissory note with

Harris Bank with a rate of prime plus 0.5% to be repaid over 5 years with equal monthly installments plus interest.  This money was used to retire the AFSC debt and make the December 2014 payment on the AAFC loan.  The balance owing at December 31, 2015 was US$754,475 (2014: $955,668).

The Company has committed to the following repayments:

2016	$	201,193
2017	$	201,193
2018	$	201,193
2019	$	150,895

As of December 31, 2015, Company was in compliance with all loan covenants.

Continuity	2015			2014
Balance, January 1	$	1,112,689			1,297,830
Plus:  Proceeds from loans		-			1,005,967
Less:  Payments on loan		337,631			982,973
Effect of exchange rate		(20,583	)		(208,135	)
Balance, December 31	$	754,475		$	1,112,689

Outstanding balance at December 31,	2015			2014
a)  Long term debt - AAFC	$	-		$	157,5021
c)  Long term debt - Harris		754,475			955,668
Long-term Debt	$	754,475		$	1,112,689
Less: current portion		(201,193	)		(358,214	)
	$	553,282		$	754,475