8. Financings

Revolving Credit Facility

We have a loan and security agreement with Bank of America to borrow up to $27.0 million on a revolving basis, based upon specified percentages of eligible receivables and inventory (“the Revolving Credit Facility”) which matures in October 2017. Our Chairman, Chief Executive Officer and President has guaranteed $7 million of the borrowings under the Revolving Credit Facility; this guarantee enables us to borrow $7 million in addition to the amount available from receivables and inventory, and may be terminated at any time. At September 30, 2016 and December 31, 2015, the balance outstanding on the Revolving Credit Facility was $25.5 million and $22.0 million, respectively. We recorded interest expense of $0.2 million for each of the three months ended September 30, 2016 and 2015, and $0.7 million and $0.5 million for the nine months ended September 30, 2016 and 2015, respectively.

Borrowings under the arrangement bear interest at a LIBOR rate or a defined base rate, each plus an applicable margin, depending on the nature of the loan. We are also obligated to pay various fees monthly. Outstanding loans become payable on demand to the extent that such loans exceed the Borrowing Base, and all outstanding amounts must be repaid on October 4, 2017. All obligations under the Revolving Credit Facility are secured by the assets of Revolution, and are guaranteed by Revolution.

The Revolving Credit Facility contains covenants that limit our ability to incur other debt, allow a lien on any property, pay dividends, restrict any wholly owned subsidiary from paying dividends, make investments, dispose of property, make loans or advances or enter into transactions with affiliates, among other things. As of September 30, 2016, we were in compliance with our covenants.

Notes Payable

Notes payable consisted of the following at September 30, 2016:

Energy Source Acquisition Notes

In connection with the acquisition of Energy Source in August 2015, we issued $10.0 million in promissory notes bearing interest at 5% per annum due July 20, 2016, which are supported by an irrevocable letter of credit from RVL. In July 2016, the maturity date was extended to January 2017, with an interest rate of 7%. We recorded accrued interest of $0.1 million and $0.2 million at September 30, 2016 and December 31, 2015, respectively. We recorded interest expense of $0.2 million for the three months ended September 30, 2016, and $0.4 million for the nine months ended September 30, 2016 (see Note 2).

Value Lighting Acquisition Note

In conjunction with the acquisition of Value Lighting, we refinanced $3.7 million of Value Lighting’s trade accounts payable by issuing a note payable to the creditor. The note is payable in monthly installments through October 2019 and a lump sum payment of $1.4 million due on November 22, 2018, which may be settled, at our option, in either cash or an equivalent amount of common shares based upon their then-current market value.

TNT Acquisition Notes

In connection with the acquisition of TNT in May 2016, we issued $2.0 million in promissory notes bearing interest at 5% per annum, of which $1.0 million is due on April 21, 2017 and $1.0 million is due on November 6, 2017 (see Note 2).