INDEBTEDNESS

Long‑term Debt

Long‑term debt as of August 31, 2016 and 2015 consist of the following loans with a bank (in thousands):


	August 31,
	2016		2015
First note payable	$	1,105	$	1,207
Second note payable		1,804		1,933
Third note payable		—		767
Total long-term debt		2,909		3,907
Less: Current installments		(314)		(1,068)
Total long-term debt, excluding current installments	$	2,595	$	2,839

The long‑term notes in the table above carry variable interest rates, which ranged from 1.62% to 2.0% per annum as of August 31, 2016 and 2015, are payable in monthly installments, and are secured by the Company’s property, plant and equipment. The interest rates are based on the annual time deposit rate plus a certain spread. The first note payable requires monthly payments of principal and interest in the amount of $13 thousand over the 15‑year term of the note with final payment to occur in May 2024. The second note payable requires monthly payments of principal and interest in the amount of $17 thousand over the 15‑year term of the note with final payment to occur in December 2025. The notes do not have prepayment penalties or balloon payments upon maturity of the notes.

The scheduled principal payments for the Company’s long‑term debt as of August 31, 2016 consist of the following (in thousands):


	Scheduled
	Principal
Years Ending August 31,	Payments
2017	$	314
2018		319
2019		324
2020		330
2021		335
Thereafter		1,287
Total	$	2,909