13. Secured Credit Facility
|12 Months Ended|
Dec. 31, 2015
|Secured Credit Facility|
|13. Secured Credit Facility||
On August 28, 2015, FNBS entered into a $40.0 million Credit Facility with Opus Bank, which facility was amended and restated by the Amended Credit Facility. The Amended Credit Facility consists of a $15.0 million, four-year credit facility, and a $25.0 million, five-year term loan. The maturity date of amounts borrowed under the revolving facility is August 28, 2019, and the maturity date of any amounts borrowed under the term loan is August 28, 2020.
As of December 31, 2015, the Company had borrowed $15.0 million under the revolver and $25.0 million under the term loan. The Company pays interest monthly at an initial rate of 4.5%, and recognized interest expense of approximately $282,000 during 2015. The interest rate is the higher of (a) the rate of interest in effect for such day as publicly announced from time to time by the Wall Street Journal as its prime rate (or the average prime rate if a high and a low prime rate are therein reported) plus the Applicable Margin (as defined in the Amended Credit Facility) in effect at such time, or (b) 3.25% plus the Applicable Margin.
We used the proceeds from the credit facility to retire approximately $11.0 million of notes held by Plexus Fund II, L.P., Plexus Funds III, L.P. and Plexus Fund QP III, L.P. (Plexus) and $28.0 million to fund our purchase of the assets of RootAxcess and the stock of Fidelity (See Note 5).
The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.
Reference 1: http://www.xbrl.org/2003/role/presentationRef