|6 Months Ended|
Jun. 30, 2018
Revolving Credit Facility
On January 26, 2017, we amended the loan and security agreement with Bank of America to borrow up to $50.0 million on a revolving basis, based upon specified percentages of eligible receivables and inventory, which matures on January 26, 2020 (the “Revolving Credit Facility”). Under the Revolving Credit Facility, the maximum applicable margin for LIBOR rate loans is 2.75%, and the maximum applicable margin for base rate loans is 1.75%. As of June 30, 2018, our Chairman, Chief Executive Officer and President had guaranteed $10.0 million of the borrowings under the Revolving Credit Facility (see Note 13). At June 30, 2018 and December 31, 2017, the balance outstanding on the Revolving Credit Facility was $42.1 million and $38.6 million, respectively. We recorded interest expense of $0.5 million for both the three months ended June 30, 2018 and 2017, respectively, and $1.0 million and $0.9 million for the six months ended June 30, 2018 and 2017, respectively.
In connection with obtaining the revolving credit facility, we incurred debt issuance costs, which are being amortized through the maturity date. At June 30, 2018 and December 31, 2017, we had $0.5 million and $0.6 million, respectively, of deferred debt issuance costs, which are recorded in “Other assets, net” in the unaudited Condensed Consolidated Balance Sheets. Amortization expense of deferred debt issuance costs was less than $0.1 million and $0.1 million for the three months ended June 30, 2018 and 2017, respectively, and $0.1 million and $0.2 million for the six months ended June 30, 2018 and 2017, respectively.
In conjunction with the acquisition of Value Lighting, we refinanced $3.7 million of Value Lighting’s trade accounts payable. The acquisition payable, which was modified during the second quarter of 2018, is paid in monthly installments through October 2019 and a lump sum payment of $1.2 million due on November 22, 2019, which may be settled, at our option, in either cash or an equivalent amount of our common shares based upon their then-current market value. At June 30, 2018 and December 31, 2017, the acquisition payable was $1.8 million and $2.1 million, respectively, of which $0.5 million and $1.8 million, respectively, was current.
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://fasb.org/us-gaap/role/ref/legacyRef