Note 11 – Debt

The Company’s borrowings at March 31, 2020 and December 31, 2019, net of deferred financing costs and including the impact of interest rate derivatives on effective interest rates, are summarized below:



	As of March 31, 2020
(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	$	26,340	5.77%	5.77%
Bank of America Credit Facility (USA)	March 6, 2023		55,000		55,000		54,986	3.99%	3.99%
Bank of America Line of Credit (USA)	March 6, 2023		5,000		5,000		5,000	3.99%	3.99%
Cinemas 1, 2, 3 Term Loan (USA)	April 1, 2022		25,000		25,000		24,504	4.25%	4.25%
Minetta & Orpheum Theatres Loan (USA)(2)	November 1, 2023		8,000		8,000		7,894	3.63%	5.15%
U.S. Corporate Office Term Loan (USA)	January 1, 2027		9,199		9,199		9,096	4.64% / 4.44%	4.61%
Purchase Money Promissory Note	September 18, 2024		3,204		3,204		3,204	5.00%	5.00%
Union Square Construction Financing (USA)	December 29, 2020		50,000		36,947		36,782	5.50%	5.50%
Denominated in foreign currency ("FC") (3)
NAB Corporate Term Loan (AU)	December 31, 2023		73,668		73,668		73,512	1.69%	1.69%
Westpac Bank Corporate (NZ)	December 31, 2023		19,069		19,069		19,069	2.30%	2.30%
		$	276,053	$	263,000	$	260,387

(1)

Net of deferred financing costs amounting to $2.6 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 March 31, 2020.



	As of December 31, 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	$	26,311	5.94%	5.94%
Bank of America Credit Facility (USA)	March 6, 2023		55,000		33,500		33,445	4.80%	4.80%
Bank of America Line of Credit (USA)	March 6, 2023		5,000		—		—	4.80%	4.80%
Cinemas 1, 2, 3 Term Loan (USA)	April 1, 2022		18,658		18,658		18,532	3.25%	3.25%
Minetta & Orpheum Theatres Loan (USA)(2)	November 1, 2023		8,000		8,000		7,887	3.74%	5.15%
U.S. Corporate Office Term Loan (USA)	January 1, 2027		9,260		9,260		9,153	4.64% / 4.44%	4.64%
Union Square Construction Financing (USA)	December 29, 2020		50,000		36,048		36,035	6.02%	6.02%
Purchase Money Promissory Note	September 18, 2024		3,363		3,363		3,363	5.00%	5.00%
Denominated in foreign currency ("FC") (3)
NAB Corporate Term Loan (AU)	December 31, 2023		84,360		65,731		65,541	1.77%	1.77%
Westpac Bank Corporate (NZ)	December 31, 2023		21,584		6,745		6,745	3.05%	3.05%
Total		$	283,138	$	209,218	$	207,012

(1)

Net of deferred financing costs amounting to $2.2 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 December 31, 2019.

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



	March 31,		December 31,
Balance Sheet Caption	2020		2019
Debt - current portion	$	171,426	$	36,736
Debt - long-term portion		59,252		140,602
Subordinated debt - current portion		651		644
Subordinated debt - long-term portion		29,058		29,030
Total borrowings	$	260,387	$	207,012

Impact of COVID-19

As of March 31, 2020, we were in breach of certain covenants with Bank of America and National Australia Bank (“NAB”). During the second quarter, we received bank covenant waivers from Bank of America for the first quarter of 2020, and from National Australia Bank for the second and third quarters of 2020. As of March 31, 2020, we were not in breach of any debt covenants with respect to any of our other borrowing.

Due to the continuing uncertainties relating to the effects of COVID-19, it is uncertain whether we will continue to meet our covenant requirements for the 12 months from March 31, 2020. We anticipate continuing to receive covenant waivers from the relevant lenders, although these waivers are not in our control and no assurances can be given that we will receive such waivers for a period of one year subsequent to the issuance of these financial statements. We are required by U.S. GAAP to classify the Bank of America and NAB debt as current liabilities.

Bank of America Credit Facility

On March 6, 2020, we amended our $55.0 million credit facility with Bank of America extending the maturity date to March 6, 2023. The refinanced facility carries an interest rate of 2.5% - 3.0%, depending on certain financial ratios plus a variable rate based on the loan defined “Eurodollar” interest rate.

Bank of America Line of Credit

On March 6, 2020, the term of our $5.0 million line of credit was extended to March 6, 2023.

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.

44 Union Square Construction Financing

On December 29, 2016, we closed our 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 (“BOTO”), and a $7.5 million mezzanine loan from Tammany Mezz Investor, LLC, an affiliate of Fisher Brothers. As of December 31, 2016, BOTO advanced $8.0 million to repay the existing $8.0 million loan with East West Bank. On August 8, 2019, we repaid in full the $7.5 million mezzanine loan from Tammany Mezz Investor, LLC. On January 24, 2020, we exercised the first of our two extension options on the BOTO loan, taking the maturity to December 29, 2020.

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 March 13, 2020, Sutton Hill Properties LLC (“SHP”), a 75% subsidiary of RDI, refinanced its $20.0 million term loan with Valley National Bank with a new term loan of $25.0 million, an interest rate of 4.25%, and maturity date of April 1, 2022 with two six-month options to extend.

Purchase Money Promissory Note

On September 18, 2019, we purchased 407,000 Company Class A 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 removed.

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 U.S. GAAP.