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BONDS AND BONDS INTEREST PAYABLE

9 Months Ended

Sep. 30, 2019

NOTE 8. BONDS AND BONDS INTEREST PAYABLE

Following is the outstanding balance of SPC’s Bonds and interest payable as of September 30, 2019 and December 31, 2018 (dollars in thousands):

	September 30, 2019			December 31, 2018
Bonds (Series A)	$	91,962		$	106,686
Bonds (Series B)		39,546			36,740
Bonds (Series B expansion)		20,764			19,290
Bonds (Series C)		79,115			—
Total outstanding bonds	$	231,387		$	162,716
Less: deferred bond issuance costs		(10,531	)		(8,179	)
Total outstanding bonds, net		220,856			154,537
Accrued Interest		2,577			4,037
Total oustanding bonds, net and accrued interest	$	223,433		$	158,574

The aggregate maturity of the bonds are as follows:

Year	September 30, 2019		December 31, 2018

2019	$	—	$	22,049
2020		22,786		22,049
2021		34,748		33,629
2022		34,748		33,629
2023		113,073		30,070
Thereafter		26,032		21,290
	$	231,387	$	162,716

On July 28, 2019, SPC issued Series C bonds in the amount of NIS 275 million (or approximately $78.1 million). The bonds are reported in NIS, and registered on the TASE, and bear an annual interest of 4.65%. Interest will be paid on January 31 and July 31 of each of the years 2020 through 2023, and the principal payment due in 2023. The Company incurred bond issuance costs of approximately $4.2 million.

During the nine months ended September 30, 2019, the Company made payments of $21.8 million and $11.6 million on bond principal and interests, respectively.

The Company recognized a loss on foreign currency exchange rate of $13.3 million during the nine month ended September 30, 2019.

On September 23, 2019, Southern entered into a foreign exchange risk hedging transaction agreement with Bank Leumi with the aim of hedging the risk that the NIS exchange rate against the dollar will fall below 3, thereby reducing the exposure of the bonds (Series A, B and C) to exchange rate volatility. The term of the agreement is six months and the face value of the transaction is NIS 664 million ($ 221 million). The hedge transaction costs as well as the fair value as of September 30, 2019 are immaterial.