Note 10 – Debt

The Company’s borrowings at June 30, 2018 and December 31, 2017, net of deferred financing costs and including the impact of interest rate derivatives on effective interest rates, are summarized below:


		As of June 30, 2018
(Dollars in thousands)		Maturity Date	Contractual Facility		Balance, Gross		Balance, Net(3)		Stated Interest Rate	Effective Interest Rate (1)
Denominated in USD
	Trust Preferred Securities (USA)	April 30, 2027	$	27,913	$	27,913	$	27,574	6.36%	6.36%
	Bank of America Credit Facility (USA)	November 28, 2019		55,000		31,000		31,000	5.09%	5.09%
	Bank of America Line of Credit (USA)	October 31, 2019		5,000		--		--	5.08%	5.08%
	Bank of America digital projector loan (USA)	December 28, 2019		3,830		3,830		3,830	5.00%	5.00%
	Cinema 1, 2, 3 Term Loan (USA)(4)	September 1, 2019		19,294		19,294		18,975	3.25%	3.25%
	Minetta & Orpheum Theatres Loan (USA)(4)	November 1, 2018		7,500		7,500		7,476	4.75%	4.75%
	U.S. Corporate Office Term Loan (USA)(4)	January 1, 2027		9,609		9,609		9,479	4.64% / 4.44%	4.61%
	Union Square Construction Financing (USA)(4)	December 29, 2019		57,500		19,888		17,263	6.06% / 12.10%	8.52%
Denominated in foreign currency ("FC") (2)
	NAB Corporate Term Loan (AU)	December 31, 2019		49,203		42,729		42,670	3.02%	3.02%
	Westpac Bank Corporate (general/non-construction) Credit Facility (NZ)	December 31, 2019		23,706		--		-	3.70%	3.70%
	Westpac Bank Corporate (construction) Credit Facility (NZ)	December 31, 2018		12,191		--		--	3.70%	3.70%
			$	270,746	$	161,763	$	158,267

(1)

Both interest rate derivatives associated with the Trust Preferred Securities and Bank of America Credit Facility expired in October 2017 so the effective interest rate no longer applies as of June 30, 2018.

(2)

The contractual facilities and outstanding balances of the FC-denominated borrowings were translated into U.S. dollars based on the applicable exchange rates as of June 30, 2018.

(3)

Net of deferred financing costs amounting to $3.5 million.

(4)

The term loan for our Cinema 1,2,3 Theatre was refinanced during the third quarter of 2016 with Valley National Bank. The term loan, which is collateralized by our new U.S Corporate Headquarters office building, was obtained with Citizens Asset Finance Inc. The loan for our Minetta and Orpheum Theatres was obtained from Santander Bank. In December 2016, we completed the negotiation of the construction financing for our Union Square redevelopment project, $8.0 million of which was advanced from the total construction loan limit of $57.5 million on December 29, 2016. As of June 30, 2018 an additional $11.9 million had been advanced.


		As of December 31, 2017
(Dollars in thousands)		Maturity Date	Contractual Facility		Balance, Gross		Balance, Net(3)		Stated Interest Rate	Effective Interest Rate (1)
Denominated in USD
	Trust Preferred Securities (USA)	April 30, 2027	$	27,913	$	27,913	$	27,554	5.38%	5.38%
	Bank of America Credit Facility (USA)	November 28, 2019		55,000		31,000		31,000	4.57%	4.57%
	Bank of America Line of Credit (USA)	October 31, 2019		5,000		--		--	4.57%	4.57%
	Cinema 1, 2, 3 Term Loan (USA)(4)	September 1, 2019		19,500		19,500		19,105	3.25%	3.25%
	Minetta & Orpheum Theatres Loan (USA)(4)	June 1, 2018		7,500		7,500		7,470	4.13%	4.13%
	U.S. Corporate Office Term Loan (USA)(4)	January 1, 2027		9,719		9,719		9,582	4.64% / 4.44%	4.61%
	Union Square Construction Financing (USA)(4)	December 29, 2019		57,500		8,000		5,033	5.81%	5.81%
Denominated in FC (2)
	NAB Corporate Loan Facility (AU)	June 30, 2019		51,970		30,869		30,781	3.66%	3.66%
	Westpac Bank Corporate (general/non-construction) Credit Facility (NZ)	December 31, 2019		24,850		--		--	3.70%	3.70%
	Westpac Bank Corporate (construction) Credit Facility (NZ)	December 31, 2018		12,780		--		--	3.70%	3.70%
			$	271,732	$	134,501	$	130,525

(1)

(2)

The contractual facilities and outstanding balances of the FC-denominated borrowings were translated into U.S. dollars based on the applicable exchange rates as of December 31, 2017.

(3)

Net of deferred financing costs amounting to $4.0 million.

(4)

The term loan for our Cinema 1,2,3 Theatre was refinanced during the third quarter of 2016 with Valley National Bank. The term loan, which is collateralized by our new U.S Corporate Headquarters office building, was obtained with Citizens Asset Finance, Inc.. The loan for our Minetta & Orpheum Theatres was obtained from Santander Bank. In December 2016, we completed the negotiation of the construction financing for our Union Square redevelopment project, $8.0 million of which was advanced from the total construction loan limit of $57.5 million on December 29, 2016. As of December 31, 2017 no further advances had been made under this financing agreement.

Our loan arrangements are presented, net of the deferred financing costs, on the face of our consolidated balance sheet as follows:


	Dollars in thousands
Balance Sheet Caption	June 30, 2018		December 31, 2017
Debt - current portion	$	10,747	$	8,109
Debt - long-term portion		119,946		94,862
Subordinated debt		27,574		27,554
Total borrowings	$	158,267	$	130,525

Bank of America Credit Facility

On March 3, 2016, we amended our $55.0 million credit facility with Bank of America to permit real property acquisition loans. This amendment reduces the applicable consolidated leverage ratio covenant by 0.25% and modifies the term of the facility based on the earlier of the eighteen months from the date of such borrowing or the maturity date of the credit agreement. Such modification was not considered substantial in accordance with U.S. GAAP.

Cinema 1,2,3 Term Loan

On August 31, 2016, Sutton Hill Properties LLC (“SHP”), a 75% subsidiary of RDI, refinanced its $15.0 million Santander Bank term loan with a different lender, Valley National Bank. This new $20.0 million loan is collateralized by our Cinema 1,2,3 property and bears an interest rate of 3.25% per annum, with principal instalments and accruing interest paid monthly. The new loan matures on September 1, 2019, with a one-time option to extend the maturity date for another year.

Bank of America Line of Credit

In October 2016, the term of this line of credit was extended to October 31, 2019. Such modification was not considered to be substantial under US GAAP.

U.S. Corporate Office Term Loan

On December 13, 2016, we obtained a ten-year $8.4 million mortgage loan on our new Los Angeles Corporate Headquarters at a fixed annual interest rate of 4.64%. This loan provided for a second loan upon completion of certain improvements. On June 26, 2017, we obtained a further $1.5 million under this provision at a fixed annual interest rate of 4.44%.

Union Square Construction Financing

On December 29, 2016, we closed on our new construction finance facilities totaling $57.5 million to fund the non-equity portion of the anticipated construction costs of the redevelopment of our property at 44 Union Square in New York City. The combined facilities consist of $50.0 million in aggregate loans (comprised of three loan tranches) from Bank of the Ozarks and a $7.5 million mezzanine loan from Tammany Mezz Investor, LLC, an affiliate of Fisher Brothers. At December 29, 2016, Bank of the Ozarks advanced $8.0 million to repay the then existing $8.0 million loan with East West Bank. As of June 30, 2018, an additional $4.4 million had been advanced under the senior loan facility, along with the full $7.5 million available under the mezzanine loan facility.

Presented in the table below is the breakdown of the Union Square construction financing as of June 30, 2018:


(Dollars in thousands)		Facility Limits and Advances
Financing Component	Lender	Facility Limit		Advanced-to- Date		Remaining Facility		Interest Rate(1)	Maturity Date(2)
Mezzanine loan	Tammany Mezz Investor LLC	$	7,500	$	7,500	$	--	Greater of (i) 10.50% and (ii) Adjusted LIBOR + 10%	December 29, 2019
Senior loan, including building and project loan	Bank of the Ozarks		50,000		12,388		37,612	Greater of (i) 4.75% and (ii) Adjusted LIBOR + 4.25%	December 29, 2019
Total Union Square Financing		$	57,500	$	19,888	$	37,612

(1)

Not to exceed the New York State maximum lawful borrowing rate, which typically is 16%.

(2)

Allowable for up to two (2) extension request options, one (1) year for each extension request.

Westpac Bank Corporate Credit Facility

On December 15, 2017, we extended the maturity of the 1st tranche (general/non-construction credit line) of our Westpac Corporate Credit Facility to December 31, 2019. Prior to this on April 26, 2017, we extended the maturity of our entire Westpac Corporate Credit Facility of $35.9 million (NZ$53.0 million) to December 31, 2018, from March 31, 2018. We are currently working on a longer-term renewal of our Westpac Corporate Credit Facility which will replace the existing facility.

Bank of America Digital Projector Loan

On February 5, 2018, we purchased our U.S. digital cinema projectors, which had previously been held on operating leases, using a $4.6 million loan from Bank of America. We made further U.S. digital cinema projector purchases in March and April 2018, increasing this loan to $4.9 million. This loan carries an interest rate of 5%.

NAB Corporate Term Loan (AU)

On May 9, 2018, we extended the term of NAB Corporate Term Loan to December 31, 2019. Such modification was not considered to be substantial under US GAAP.