Bank indebtedness

3 Months Ended

Mar. 31, 2019

Bank indebtedness [Text Block]

7.

Bank Indebtedness

The Company's credit facility is subject to review annually and consists of an operating demand line of credit of up to CAD$250 thousand ($187 thousand) and corporate credits cards of up to CAD$75 ($56 thousand) and $56 thousand, and foreign exchange contracts limited to CAD$425 thousand ($318 thousand). Borrowings under the operating demand line of credit bear interest at the Bank’s prime lending rate plus 2%. The credit facility and term loan (see note 8) are secured by a first ranking movable hypothec on all present and future movable property of the Company for an amount of CAD$4,250,000 ($3,180,000) plus 20%, and a 50% guarantee by Export Development Canada, a Canadian Crown corporation export credit agency. The terms of the banking agreement require the Company to comply with certain debt service coverage and debt to net worth financial covenants on an annual basis at the end of the Company’s fiscal year. As at March 31, 2019, the Company has not drawn on its credit facility.