Note 2. Debt

A summary of debt is as follows (amounts in thousands):

	December 31, 2012			March 31, 2012
10.5% Senior Notes, net of premium of $3,920 and $3,539 as of December 31, 2012 and March 31, 2012, respectively	$	358,920		$	343,539
Advanced payment from OEM, net of discount of $1,270 as of December 31, 2012	22,730			—
Other	1,845			3,792
Total debt	383,495			347,331
Current maturities	(7,908		)	(1,951		)
Total long-term debt	$	375,587		$	345,380

The line item “Interest expense” on the Condensed Consolidated Statements of Operations for the quarters and nine months ended December 31, 2012 and 2011, is as follows (amounts in thousands):

	Quarters Ended December 31,				Nine Months Ended December 31,
	2012		2011		2012			2011
Contractual interest expense	$	9,125	$	6,189	$	27,794		$	18,815
Amortization of debt issuance costs	426		274		1,278			829
Amortization of debt (premium) discount	48		415		(250		)	1,669
Imputed interest on acquisition related obligations	648		158		2,018			405
	$	10,247	$	7,036	$	30,840		$	21,718

Advanced Payment from OEM

On August 28, 2012, the Company entered into and amended an agreement (the “Agreement”), with an original equipment manufacturer (the “OEM”) pursuant to which the OEM agreed to advance KEMET $24.0 million (the “Advance Payment”). The Agreement provides that on a monthly-basis starting eight months following the receipt of the Advance Payment, the Company will pay the OEM an amount equal to a percentage of the aggregate purchase price of the capacitors sold to the OEM the preceding month, not to exceed $1.0 million per month. Pursuant to the terms of the Agreement, the percentage of the aggregate purchase price of capacitors sold to the OEM that will be used to repay the Advance Payment will double, and the total amount to be repaid will not exceed $2.0 million per month, in the event that (1) the OEM provides evidence that the price charged by KEMET for a particular capacitor during any prior quarter was equal to or greater than 110% of the price paid by the OEM or its affiliates for a third-party part qualified for the same product, and shipping in volume during such period, and (2) agreement cannot be reached between the OEM and the Company for a price adjustment during the current quarter which would bring KEMET’s price within 110% of the third-party price. Thirty-two months after the date of the Advance Payment, the remaining outstanding balance, if any, is due in full. Pursuant to the terms of the Agreement, the Company delivered to the OEM an irrevocable standby letter of credit in the amount of $16.0 million on October 8, 2012 and on October 22, 2012 the Company received the Advance Payment from the OEM. The debt discount related to the Advance Payment as of December 31, 2012 was $1.3 million which will be amortized over the term of the Agreement.

10.5% Senior Notes

On May 5, 2010, the Company completed a private placement of $230.0 million in aggregate principal amount of the Company’s 10.5% Senior Notes due 2018 (the “10.5% Senior Notes”). On March 27, 2012 and April 3, 2012, the Company completed the sale of $110.0 million and $15.0 million aggregate principal amount of its 10.5% Senior Notes due 2018, respectively, at an issue price of 105.5% of the principal amount plus accrued interest from November 1, 2011. The Senior Notes were issued as additional notes under the indenture, dated May 5, 2010, among the Company, the guarantors party thereto and Wilmington Trust Company, as trustee. Debt issuance costs related to the 10.5% Senior Notes, net of amortization, of $7.1 million and $7.8 million as of December 31, 2012 and March 31, 2012, respectively are being amortized over the term of the 10.5% Senior Notes. Debt premium related to the 10.5% Senior Notes of $3.9 million and $3.5 million as of December 31, 2012 and March 31, 2012, respectively are being amortized over the term of the 10.5% Senior Notes.

The Company had interest payable related to the 10.5% Senior Notes included in the line item “Accrued expenses” on its Condensed Consolidated Balance Sheets of $6.2 million and $14.7 million at December 31, 2012 and March 31, 2012, respectively.

Revolving Line of Credit

On September 30, 2010, KEMET Electronics Corporation (“KEC”) and KEMET Electronics Marketing (S) Pte Ltd. (“KEMET Singapore”) (each a “Borrower” and, collectively, the “Borrowers”) entered into a Loan and Security Agreement (the “Loan and Security Agreement”), with Bank of America, N.A, as the administrative agent and the initial lender. The Loan and Security Agreement provides a $50 million revolving line of credit, which is bifurcated into a U.S. facility (for which KEC is the Borrower) and a Singapore facility (for which KEMET Singapore is the Borrower). The size of the U.S. facility and Singapore facility can fluctuate as long as the Singapore facility does not exceed $30 million and the total facility does not exceed $50 million. A portion of the U.S. facility and of the Singapore facility can be used to issue letters of credit. The facilities expire on September 30, 2014.

Debt issuance costs related to the Loan and Security Agreement, net of amortization, were $0.7 million and $0.9 million as of December 31, 2012 and March 31, 2012, respectively are being amortized over the term of the Loan and Security Agreement. As described above, a standby letter of credit for $16.0 million was delivered to the OEM on October 8, 2012 which reduced the Company’s availability under the Loan and Security Agreement. There were no borrowings against the Loan and Security Agreement as of December 31, 2012 and March 31, 2012.