v3.5.0.2
Line of Credit
9 Months Ended
Sep. 30, 2016
Debt Disclosure [Abstract]  
Line of Credit

NOTE 8. Line of Credit

On March 27, 2014, the Company entered into a Loan and Security Agreement and an attendant Intellectual Property Security Agreement (collectively the “Agreement”) with Silicon Valley Bank (“SVB”), pursuant to which the Company could borrow up to $2 million based upon both its domestic and foreign eligible accounts receivable multiplied by an advance rate of 80% and 70%, respectively, with eligibility determined in accordance with the Agreement (the “Credit Facility”). The Credit Facility is secured by substantially all of the Company’s assets. Borrowings under the Credit Facility bear interest based on the face amount of the financed receivables at the prime rate plus 4.5% for domestic receivables and 3.53% for foreign receivables. On August 4, 2015, the Credit Facility, which contains representations and warranties, affirmative, restrictive and financial covenants, and events of default which are customary for credit facilities of this type, was amended to increase the availability of borrowings under the Credit Facility to $7 million. On August 23, 2016, the Credit Facility was amended to reduce the borrowing availability to $3 million. On October 6, 2016, the Credit Facility was further amended to add a $2 million sublimit to enable the Company to borrow U.S. dollars at a 70% advance rate against its Mexican Peso deposits with SVB. Borrowings under this sublimit bear interest at the prime rate. At September 30, 2016, the Company was in compliance with all covenants, $640,000 was drawn against the Credit Facility and $2,360,000 was available for borrowing under the credit line. The maturity date of the Credit Facility is September 27, 2017.