Note 6. Notes Payable and Line of Credit

Notes payable consist of the following (in thousands):

	December 31, 2013			June 30, 2014
Senior secured notes due July 1, 2018, net of discount of $2,496 and $2,222 as of December 31, 2013 and June 30, 2014, respectively, with stated interest of 12.125%	$	222,504		$	222,778
Senior secured notes due July 1, 2018, including a premium of $4,642 and $4,116 as of December 31, 2013 and June 30, 2014, respectively, with stated interest of 12.125%		104,642			104,116
Ford Credit, monthly installments of $1 comprised of principal and interest, at 6.6% , through July 2016		28			23
GMAC, monthly installments of $1 comprised of principal and interest, at 2.96%, through June 2015		10			7
GMAC, monthly installments of $1 comprised of principal and interest, at 2.96%, through August 2015		12			8
Commerce Bank, see terms in note below		—			3,726
American United Life Insurance Company, see terms in note below		3,408			—
		330,604			330,658
Less: current portion		(258	)		(188	)
Notes payable, net of current portion	$	330,346		$	330,470

The terms of the Indenture require the Company to meet certain ratio tests giving effect to anticipated transactions, including borrowing debt and making restricted payments prior to entering these transactions. These ratio tests are, as defined per the Indenture, a Fixed Charge Coverage Ratio of at least 2.00 to 1.00 (which was 0.75 to 1.00 at June 30, 2014) and a Total Leverage Ratio not greater than 2.50 to 1.00 (which was 10.42 to 1.00 at June 30, 2014). The holders of the Notes granted a waiver to these covenants in conjunction with the issuance of the Tack-On Notes, and the Company has not entered into any other transaction that requires it to meet these tests as of June 30, 2014. Had the Company been required to meet these ratio tests as of June 30, 2014, the Company would not have met the Fixed Charge Coverage Ratio or the Total Leverage Ratio.

Under the terms of the Credit Facility the Company must maintain a Fixed Charge Coverage Ratio equal to at least 1.25 to 1.00 (which ratio was 1.23 to 1.00 at June 30, 2014) and a Leverage Ratio no greater than 6.00 to 1.00 (which ratio was 6.94 to 1.00 at June 30, 2014) during such time as a Triggering Event is continuing. The Leverage Ratio required during such time as a Triggering Event will decrease to 5.50 to 1.00 on July 1, 2014 and will decrease to 5.00 to 1.00 on January 1, 2015. A “Triggering Event” occurs when the Company’s undrawn availability (measured as of the last date of each month) on the Credit Facility has failed to equal at least $10 million for two consecutive months and continues until undrawn availability equals $20 million for at least three consecutive months. The Company is only required to maintain such ratios at such time that a Triggering Event is in existence. Failure to comply with such ratios during the existence of a Triggering Event constitutes an Event of Default (as defined therein) under the Credit Facility. Had the Company been required to meet these ratio tests as of June 30, 2014, the Company would not have met the Fixed Charge Coverage Ratio or the Leverage Ratio.

The Credit Facility has a maximum commitment of $50.0 million, subject to a borrowing base calculation and the compliance with certain covenants described above. The amounts available for additional borrowings available under the Credit Facility at December 31, 2013 and June 30, 2014 were $45.5 million and $25.3 million, respectively, subject to compliance with certain covenants described above.

The mortgage payable related to the Multiband headquarters building was refinanced with Commerce Bank on March 28, 2014, with an interest rate of 5.75% per annum and fifty-nine required monthly payments of principal and interest of $31,000 through March 2019. A final payment of $2.9 million is also due in March 2019. As additional collateral for the mortgage, Multiband Special Purpose, LLC, a wholly owned subsidiary of the Company (“MBSP”), deposited $1.0 million in escrow, which is classified as deposits and other assets on the balance sheet at June 30, 2014.

The original mortgage related to the Multiband headquarters building from American United Life Insurance Company was paid in full on March 28, 2014. The related letter of credit issued in the lender’s favor as collateral for the mortgage by MBSP, and fully backed by a certificate of deposit held by the lender of $1.4 million, was repaid to Multiband in April 2014.