Debt

6 Months Ended

Jun. 30, 2020

9. Debt

Notes Payable and Other Borrowings

The table below sets forth information regarding the Company’s notes payable and other borrowings (dollars in thousands):



	June 30, 2020						December 31, 2019
					Carrying						Carrying
					Amount of						Amount of
	Debt		Interest		Pledged		Debt		Interest		Pledged
	Balance		Rate		Assets		Balance		Rate		Assets
Bluegreen:
NBA Éilan Loan	$	16,996		4.75%	$	28,649	$	18,820		4.95%	$	31,259
Fifth Third Syndicated Line of Credit		70,000		2.49%		86,753		30,000		3.85%		49,062
Fifth Third Syndicated Term Loan		96,250		3.71%		119,285		98,750		3.71%		161,497
Unamortized debt issuance costs		(1,338)						(1,410)
Total Bluegreen	$	181,908					$	146,160
Other:
Community Development District Obligations	$	33,107		4.25-6.00%	$	46,571	$	29,287		4.25-6.00%	$	49,352
TD Bank Term Loan and Line of Credit		7,974		3.17%		(1)		6,826		5.00%		(1)
Iberia $50.0 million Revolving Line of Credit		—		—		(2)		—		—		(2)
Banc of America Leasing & Capital Equipment Note		—		—		—		355		4.75%		(3)
Bank of America Revolving Line of Credit		—		—		—		2,000		3.24%		(3)
Unsecured Note (4)		—		—		—		3,400		6.00%		—
Centennial Bank Note (4)		1,449		5.25%		1,867		1,469		5.25%		1,892
Other		35		15.00%		—		58		15.00%		—
Unamortized debt issuance costs		(1,045)						(824)
Total other	$	41,520					$	42,571
Total notes payable and other borrowings	$	223,428					$	188,731

(1)The collateral is a blanket lien on Renin’s assets.

(2)The collateral is a membership interest having a value of not less than $100.0 million in Woodbridge Holdings Corporation, a wholly-owned subsidiary of the Company which holds the Company’s investment in Bluegreen’s common stock.

(3)The collateral is a security interest in the equipment financed by the underlying note. Additionally, IT’SUGAR is guarantor of the note.

(4)BBX Capital is guarantor of the note.

See Note 13 to the Company’s consolidated financial statements included in the 2019 Annual Report for additional information regarding the above listed notes payable and other borrowings.

Except as described below, there were no new debt issuances or significant changes related to the above listed notes payable and other borrowings during the six months ended June 30, 2020.

Fifth Third Syndicated Line of Credit and Fifth Third Syndicated Term Loan. In March 2020, with its decision to increase liquidity given the anticipated effects of the COVID-19 pandemic, Bluegreen drew down $60.0 million under its line of credit. In June 2020, Bluegreen repaid $40 million under its syndicated line-of-credit and amended the agreements to modify the definition of certain customary covenants.

Community Development District Obligation. In May 2020, the Meadow View at Twin Creeks Community Development District issued $8.6 million of community development bonds related to the Company’s Beacon Lake Community development. The bonds issued in May 2020 have fixed interest rates ranging from 4.25% to 5.38% and mature at various times during the years 2026 through 2051. The Company at its option has the ability to repay a specified portion of the bonds at the time that it sells developed lots in the Beacon Lakes Community.

Toronto-Dominion Commercial Bank (“TD Bank”) Line of Credit. Renin maintains a credit facility with TD Bank which provides for a revolving line of credit for up to approximately $16.3 million based on available collateral, as defined in the facility, and subject to Renin’s compliance with the terms and conditions of the credit facility, including certain specific financial covenants. Through February 2020, the credit facility also provided for term loans for up to $1.7 million. However, in February 2020, the credit facility was amended to replace the existing debt service coverage ratio with an interest coverage ratio, and in connection with the amendment to the credit facility, Renin repaid the outstanding balance of the term loans with borrowings from the revolving line of credit. In July 2020, the credit facility was also amended to extend the maturity date of the facility from September 2020 to September 2022.

Banc of America Leasing & Capital Equipment Note and Bank of America Revolving Line of Credit. During the three months ended June 30, 2020, a wholly-owned subsidiary of BBXRE purchased IT’SUGAR’s revolving line of credit and equipment note from the respective lenders for the outstanding principal balance of the loans plus accrued interest and subsequently advanced an additional $2.0 million to IT’SUGAR pursuant to the terms of the loans. As the Company paid the respective third party lenders and was relieved of its obligations to such lenders under the respective debt arrangements, the Company derecognized the liabilities in its consolidated financial statements in connection with the purchase of the loans by its wholly-owned subsidiary.

Receivable-Backed Notes Payable

The table below sets forth information regarding Bluegreen’s receivable-backed notes payable facilities (dollars in thousands):



	June 30, 2020						December 31, 2019
					Principal						Principal
					Balance of						Balance of
					Pledged/						Pledged/
	Debt		Interest		Secured		Debt		Interest		Secured
	Balance		Rate		Receivables		Balance		Rate		Receivables
Receivable-backed notes
payable - recourse:
Liberty Bank Facility ⁽¹⁾	$	21,663		4.00%	$	26,630	$	25,860		4.75%	$	31,681
NBA Receivables Facility		26,484		3.50%		32,870		32,405		4.55%		39,787
Pacific Western Facility ⁽¹⁾		26,452		3.06%		32,747		30,304		4.68%		37,809
Total	$	74,599			$	92,247	$	88,569			$	109,277

Receivable-backed notes
payable - non-recourse:
KeyBank/DZ Purchase Facility		65,159		2.50%		81,522		31,708		3.99%		39,448
Quorum Purchase Facility		36,759		4.75-5.50%		42,836		44,525		4.75-5.50%		49,981
2012 Term Securitization		6,093		2.94%		7,167		8,638		2.94%		9,878
2013 Term Securitization		14,811		3.20%		16,581		18,219		3.20%		19,995
2015 Term Securitization		26,426		3.02%		28,707		31,188		3.02%		33,765
2016 Term Securitization		40,897		3.35%		46,375		48,529		3.35%		54,067
2017 Term Securitization		57,641		3.12%		66,280		65,333		3.12%		74,219
2018 Term Securitization		81,858		4.02%		94,755		91,231		4.02%		103,974
Unamortized debt issuance costs		(4,438)		—		—		(5,125)		—		—
Total	$	325,206			$	384,223	$	334,246			$	385,327
Total receivable-backed debt	$	399,805			$	476,470	$	422,815			$	494,604

(1)Recourse on these facilities are each limited to $10 million, subject to certain exceptions.

See Note 13 to the Company’s consolidated financial statements included in the 2019 Annual Report for additional information regarding the above listed receivable-backed notes payable facilities.

Except as described below, there were no new debt issuances or significant changes related to the above listed facilities during the six months ended June 30, 2020.

Liberty Bank Facility. Since 2008, Bluegreen has maintained a revolving VOI notes receivable hypothecation facility (the “Liberty Bank Facility”) with Liberty Bank which provides for advances on eligible receivables pledged under the Liberty Bank Facility, subject to specified terms and conditions, during the revolving credit period. In June 2020, Bluegreen amended the Liberty Bank Facility to extend the revolving credit period from June 2020 to June 2021 and the maturity from March 2023 to June 2024. In addition, the amendment decreased the advance rate with respect to Qualified Timeshare Loans from 85% to 80% of the unpaid principal balance of the Qualified Timeshare Loans by September 2020. The advance rate is 60% of the unpaid principal balance of Non-Conforming Qualified Timeshare Loans. The amendment also reduced the maximum permitted outstanding borrowings from $50.0 million to $40.0 million, subject to the terms of the facility, and commencing on July 1, 2020, decreased the interest rate to the Wall Street Journal (“WSJ”) Prime Rate minus 0.10% with a floor of 3.40% from the Prime Rate with a floor of 4.00%. In addition, recourse to Bluegreen under the restructured facility was reduced to $10 million, with certain exceptions set forth in the facility. Subject to the terms of the facility, principal and interest due under the Liberty Bank Facility are paid as cash is collected on the pledged receivables, with the remaining balance being due at maturity.

Quorum Purchase Facility. Bluegreen/Big Cedar Vacations has a VOI notes receivable purchase facility (the “Quorum Purchase Facility”) with Quorum Federal Credit Union (“Quorum”), pursuant to which Quorum has agreed to purchase eligible VOI notes receivable in an amount of up to an aggregate $50.0 million purchase price, subject to certain conditions precedent and other terms of the facility. On March 17, 2020, the Quorum Purchase Facility was amended to extend the advance period to December 2020 from June 2020. The interest rate on each advance is set at the time of funding based on rates mutually agreed upon by all parties. The maturity of the Quorum Purchase Facility is December 2032. The Quorum Purchase Facility provides for an 85% advance rate on eligible receivables sold under the facility; however, Quorum can modify this advance rate on future purchases subject to the terms and conditions of the Quorum Purchase Facility.

Junior Subordinated Debentures

The table below sets forth information regarding the Company’s junior subordinated debentures (dollars in thousands):



	June 30, 2020				December 31, 2019
			Effective				Effective
	Carrying		Interest		Carrying		Interest
	Amounts		Rates ⁽¹⁾		Amounts		Rates ⁽¹⁾
Woodbridge - Levitt Capital Trusts I - IV	$	66,302		4.11 - 4.56%	$	66,302		5.74 - 5.95%
Bluegreen Statutory Trusts I - VI		110,827		5.56 - 6.27%		110,827		6.74 - 6.86%
Unamortized debt issuance costs		(1,093)				(1,129)
Unamortized purchase discount		(38,333)				(38,746)
Total junior subordinated debentures	$	137,703			$	137,254

(1)The Company’s junior subordinated debentures bear interest at 3-month LIBOR (subject to quarterly adjustment) plus a spread ranging from 3.80% to 4.90%.

All of the junior subordinated debentures were eligible for redemption by Woodbridge and Bluegreen, as applicable, as of June 30, 2020 and December 31, 2019.

See Note 13 to the Company’s consolidated financial statements included in the 2019 Annual Report for additional information regarding the Company’s junior subordinated debentures.

Debt Compliance and Amounts Available under Credit Facilities

As of June 30, 2020, BBX Capital and its subsidiaries were in compliance with all financial debt covenants under their debt instruments, as amended.

Amounts available under credit facilities for BBX Capital and its subsidiaries as of June 30, 2020 were as follows (in thousands):



BBX Capital	$	22,383
Bluegreen		158,500
Renin		5,182
Total credit availability	$	186,065

The amounts available under the Company’s credit facilities are subject to eligible collateral requirements and the terms of the facilities, as applicable.

The effects of the COVID-19 pandemic on the Company’s operations could impact its ability to remain in compliance with the financial covenants under its debt instruments and the extent of availability under its credit facilities in future periods. If the Company is unable to maintain compliance with its debt covenants or obtain waivers from its lenders if it is not in compliance with its covenants, the Company will no longer be able to access its revolving credit facilities or may have to repay all or a portion of its borrowings prior to their scheduled maturity dates or provide additional collateral for such borrowings, any of which would have a material adverse effect on the Company’s liquidity, financial position, and results of operations.