Note 10 – Debt

The Company’s borrowings at September 30, 2019 and December 31, 2018, net of deferred financing costs and including the impact of interest rate derivatives on effective interest rates, are summarized below:



	As of September 30, 2019
(Dollars in thousands)	Maturity Date	Contractual Facility		Balance, Gross		Balance, Net(1)		Stated Interest Rate	Effective Interest Rate
Denominated in USD
Trust Preferred Securities (USA)	April 30, 2027	$	27,913	$	27,913	$	26,228	6.27%	6.27%
Bank of America Credit Facility (USA)	October 1, 2020		55,000		27,000		26,959	4.79%	4.79%
Bank of America Line of Credit (USA)	October 1, 2020		5,000		5,000		5,000	5.04%	5.04%
Banc of America digital projector loan (USA)	December 28, 2019		706		706		706	5.00%	5.00%
Cinemas 1, 2, 3 Term Loan (USA)	December 1, 2019		18,767		18,767		18,597	3.25%	3.25%
Minetta & Orpheum Theatres Loan (USA)(2)	November 1, 2023		8,000		8,000		7,880	4.15%	5.15%
U.S. Corporate Office Term Loan (USA)	January 1, 2027		9,320		9,320		9,210	4.64% / 4.44%	4.61%
Purchase Money Promissory Note	September 18, 2024		3,519		3,519		3,519	5.00%	5.00%
Union Square Construction Financing (USA)	December 29, 2019		50,000		32,350		31,915	6.27%	6.27%
Denominated in foreign currency ("FC") (3)
NAB Corporate Term Loan (AU)	December 31, 2023		80,952		54,977		54,782	1.91%	1.91%
Westpac Bank Corporate (NZ)	December 31, 2023		20,038		7,514		7,514	3.05%	3.05%
		$	279,215	$	195,066	$	192,310

(1)

Net of deferred financing costs amounting to $2.8 million.

(2)

The interest rate derivative associated with the Minetta & Orpheum loan provides for an effective fixed rate of 5.15%.

(3)

The contractual facilities and outstanding balances of the foreign currency denominated borrowings were translated into U.S. dollars based on the applicable exchange rates as of September 30, 2019.



	As of December 31, 2018
(Dollars in thousands)	Maturity Date	Contractual Facility		Balance, Gross		Balance, Net(1)		Stated Interest Rate	Effective Interest Rate
Denominated in USD
Trust Preferred Securities (USA)(2)	April 30, 2027	$	27,913	$	27,913	$	26,061	6.52%	6.52%
Bank of America Credit Facility (USA)(2)	May 1, 2020		55,000		25,000		25,000	5.02%	5.02%
Bank of America Line of Credit (USA)	October 31, 2019		5,000		—		—	5.48%	5.48%
Banc of America digital projector loan (USA)	December 28, 2019		2,604		2,604		2,604	5.00%	5.00%
Cinemas 1, 2, 3 Term Loan (USA)	September 1, 2019		19,086		19,086		18,838	3.25%	3.25%
Minetta & Orpheum Theatres Loan (USA)	November 1, 2023		8,000		8,000		7,857	4.88%	4.88%
U.S. Corporate Office Term Loan (USA)	January 1, 2027		9,495		9,495		9,373	4.64% / 4.44%	4.61%
Union Square Construction Financing (USA)	December 29, 2019		57,500		27,182		25,280	6.76% / 12.51%	8.35%
Denominated in foreign currency ("FC")(3)
NAB Corporate Loan Facility (AU)	December 31, 2023		46,856		37,696		37,660	3.05%	3.05%
Westpac Corporate Credit Facility (NZ)	December 31, 2023		21,475		10,067		10,067	3.80%	3.80%
		$	252,929	$	167,043	$	162,740

(1)

Net of deferred financing costs amounting to $4.3 million.

(2)

The interest rate derivatives associated with the Trust Preferred Securities and the Bank of America Credit Facility expired in October 2017 so the effective interest rate no longer applied as of December 31, 2018.

(3)

The contractual facilities and outstanding balances of the foreign currency denominated borrowings were translated into U.S. dollars based on the applicable exchange rates as of December 31, 2018.

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



	September 30,		December 31,
Balance Sheet Caption	2019		2018
Debt - current portion	$	34,374	$	30,393
Debt - long-term portion		131,681		106,286
Subordinated debt		26,255		26,061
Total borrowings	$	192,310	$	162,740

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. On March 5, 2019, this Credit Facility was extended for six (6) months to May 1, 2020. On August 8, 2019, this Credit Facility was extended by an additional four months to September 1, 2020. On November 5, 2019, this Credit Facility was further extended by an additional one month to October 1, 2020.

Bank of America Line of Credit

In October 2016, the term of this $5.0 million line of credit was extended to October 31, 2019. Such modification was not considered to be substantial under US GAAP. On August 8, 2019, this Line of Credit was extended an additional ten months to September 1, 2020. On November 5, 2019, this Line of Credit was further extended by an additional one month to October 1, 2020.

Minetta and Orpheum Theatres Loan

On October 12, 2018, we refinanced our $7.5 million loan with Santander Bank, which is secured by our Minetta and Orpheum Theatres, with a loan for a five year term of $8.0 million. Such modification was not considered to be substantial under US GAAP.

Banc 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 Banc of America. We made further U.S. digital projector purchases, of projectors similarly held on other operating leases, in March and April 2018, increasing this loan to $4.9 million. This loan carries an interest rate of 5% and is due and payable December 28, 2019.

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 consisted 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 31, 2016, Bank of the Ozarks advanced $8.0 million to repay the then existing $8.0 million loan with East West Bank. As of September 30, 2019, an additional $24.4 million had been advanced under the senior loan facility. On August 8, 2019, we repaid in full the $7.5 million mezzanine loan from Tammany Mezz Investor, LLC.

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%.

Cinemas 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 new lender, Valley National Bank. This new $20.0 million loan is collateralized by our Cinemas 1,2,3 property and bears an interest rate of 3.25% per annum, with principal installments and accruing interest paid monthly. The new loan matured on September 1, 2019, with a one-time option to extend maturity date for another year. On August 8, 2019, this maturity date was extended to December 1, 2019, with the one-time option to extend the maturity date for another year preserved. Such modification was not considered to be substantial under US GAAP.

Purchase Money Promissory Note

On September 18, 2019, we purchased 407,000 Company shares in a privately negotiated transaction under our Share Repurchase Program for $5.5 million. Of this amount, $3.5 million was paid by the issuance of a Purchase Money Promissory Note, which bears an interest rate of 5.0% per annum, payable in equal quarterly payments of principal plus accrued interest. The Purchase Money Promissory Note matures on September 18, 2024.

Westpac Bank Corporate Credit Facility (NZ)

On December 20, 2018, we restructured our Westpac Corporate Credit Facilities. The maturity of the 1st tranche (general/non-construction credit line) was extended to December 31, 2023, with the available facility being reduced from NZ$35.0 million to NZ$32.0 million. The facility bears an interest rate of 1.75% above the Bank Bill Bid Rate on the drawn down balance and a 1.1% line of credit charge on the entire facility. The 2nd tranche (construction line) with a facility of NZ$18.0 million was not renewed.

Australian NAB Corporate Term Loan (AU)

On March 15, 2019, we amended our Revolving Corporate Markets Loan Facility with National Australia Bank (“NAB”) from a facility comprised of (i) a AU$66.5 million loan facility with an interest rate of 0.95% above the Bank Bill Swap Bid Rate (“BBSY”) and a maturity date of June 30, 2019 and (ii) a bank guarantee of AU$5.0 million at a rate of 1.90% per annum into a (i) AU$120.0 million Corporate Loan facility at rates of 0.85%-1.30% above BBSY depending on certain ratios with a due date of December 31, 2023, of which AU$80.0 million is revolving and AU$40.0 million is core and (ii) a Bank Guarantee Facility of AU$5.0 million at a rate of 1.85% per annum. Such modifications of this particular term loan were not considered to be substantial under US GAAP.