8. Short and Long-Term Debt

Short and long-term debt is summarized as follows:



	September 30,		December 31,
	2013		2012

Domestic Asset-Based Revolving Credit Facility	$	4,510	$	4,360
Foreign Overdraft and Letter of Credit Facility		1,345		1,795
Domestic Term-Loan		3,000		3,750
Note Payable Datrix Purchase		-		262
Total Debt		8,855		10,167
Less: Current maturities		(8,815)		(2,945)
Total Long-Term Debt	$	40	$	7,222

Domestic Credit Facilities

The Company and its domestic subsidiaries are parties to a credit facility with The PrivateBank and Trust Company. The credit facility, as amended, provides for:

an $8,000 revolving credit facility, with a $200 sub facility for letters of credit. Under the revolving credit facility, the availability of funds depends on a borrowing base composed of stated percentages of the Company’s eligible trade receivables and eligible inventory, and eligible equipment less a reserve; and

§	a term loan in the original amount of $4,000.

In December 2012, the Company and its domestic subsidiaries entered into a Fifth Amendment to the Loan and Security Agreement with The PrivateBank and Trust Company. The amendment, among other things:

§	permitted the Company to borrow an additional $1,250 under the term loan by increasing the then current principal balance of the term loan from $2,750 to $4,000, while keeping the existing amortization schedule in place.

increased the inventory cap on the borrowing base from $3,000 to $3,500 and removed eligible equipment from the base. Under the revolving credit facility as amended, the availability of funds depends on a borrowing base composed of stated percentages of the Company’s eligible trade receivables and inventory, less a reserve;

§	eliminated the minimum EBITDA covenant and amended certain other financial covenants; and

§	changed the dates when covenant compliance will be tested from monthly to quarterly.

The Company was not in compliance with the fixed charge and leverage covenants under the credit facility as of September 30, 2013 and obtained a covenant waiver from The PrivateBank.

The credit facility expires on August 13, 2014 and all outstanding borrowings will become due and payable. As a result, all of the borrowings under this facility have been characterized as current liabilities on our balance sheet. The Company expects to seek a further extension of the term of this facility or a new credit facility in the near future. As part of the extension or new credit facility the Company will seek revisions to its existing covenants. However, there is no guarantee that the Company will be able to obtain a further extension or new credit facility or that any revisions to the covenants will be favorable to the Company. Additionally, there can be no assurances that a future covenant violation would not lead The PrivateBank or a new lender to declare an event of default and accelerate our obligations under the credit facility.

Loans under the credit facility are secured by a security interest in substantially all of the assets of the Company and its domestic subsidiaries including a pledge of the stock of its domestic subsidiaries. Loans under the credit facility bear interest at varying rates based on the Company’s leverage ratio of funded debt / EBITDA, at the option of the Company, at:

§	the London InterBank Offered Rate (“LIBOR”) plus 3.00% - 4.00%, or

§	the base rate, which is the higher of (a) the rate publicly announced from time to time by the lender as its “prime rate” and (b) the Federal Funds Rate plus 0.5%, plus 0.25% - 1.25% depending on the Company’s leverage ratio.

Interest is payable monthly in arrears, except that interest on LIBOR based loans is payable at the end of the one, two or three month interest periods applicable to LIBOR based loans. IntriCon is also required to pay a non-use fee equal to 0.25% per year of the unused portion of the revolving line of credit facility, payable quarterly in arrears.

Weighted average interest on the revolving credit facility was 4.56% for the nine months ended September 30, 2013 and 4.52% for the year ended December 31, 2012. The outstanding balance of the revolving credit facility was $4,510 and $4,360 at September 30, 2013 and December 31, 2012, respectively. The total remaining availability on the revolving credit facility was approximately $1,939 and $2,689 at September 30, 2013 and December 31, 2012, respectively. The outstanding principal balance of the term loan, as amended, is payable in quarterly installments of $250, commencing with the calendar quarter ended December 31, 2012. Any remaining principal and accrued interest is payable on August 13, 2014. IntriCon is also required to use 100% of the net cash proceeds of certain asset sales (excluding inventory and certain other dispositions), sale of capital securities or issuance of debt to pay down the term loan.

Foreign Credit Facility

In addition to its domestic credit facilities, the Company’s wholly-owned subsidiary, IntriCon, PTE LTD., entered into an international senior secured credit agreement with Oversea-Chinese Banking Corporation Ltd. that originally provided for a $1,977 line of credit. The international credit agreement was modified in August 2010 and again in August 2011 to allow for an additional total of $736 in borrowing under the existing base to fund the Singapore facility relocation, Batam facility construction and various other capital needs with varying due dates from 2013 to 2015. Borrowings bear interest at a rate of .75% to 2.5% over the lender’s prevailing prime lending rate. Weighted average interest on the international credit facilities was 3.97% and 3.89% for the nine months ended September 30, 2013 and the year ended December 31, 2012. The outstanding balance was $1,345 and $1,795 at September 30, 2013 and December 31, 2012, respectively. The total remaining availability on the international senior secured credit agreement was approximately $799 and $639 at September 30, 2013 and December 31, 2012, respectively.