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Related Party Notes Payable
 9 Months Ended
Mar. 31, 2014
Related Party Notes Payable

Note 3. Related Party Notes Payable

 

 

Maturity

 

  

Interest
Rate

 

 

March 31,
2014

 

  

June 30,
2013

 

Related party notes payable

 

7/31/2013

  

  

 

8

%

 

$

—

  

  

$

2,897

  

We had an interest-bearing subordinated loan, or the Note, from our Chief Executive Officer, Ashutosh Roy, which originated in 2002 and previously had a maturity date of March 31, 2012. On March 31, 2012, we entered into Amendment No.1 to the loan agreement with Mr. Roy. Pursuant to Amendment No.1 and subject to the terms and conditions contained therein, we agreed that (i) the maturity date of the Note would be extended 90 days to June 29, 2012; (ii) as of April 1, 2012 the “Face Amount” of the Note would be $5.6 million, which included $109,000 of interest for the 90 day extension. The Face Amount of $5.6 million reflected the reduced interest rate on the Note of 8% beginning April 1, 2012 prior to which the interest rate was 12%; and (iii) the Company could prepay the Note in full or in part at any time prior to the maturity date without interest penalty.

On June 29, 2012, we entered into Amendment No. 2 to the loan agreement with Mr. Roy. Pursuant to Amendment No. 2, and subject to the terms and conditions contained therein, we agreed to extend the maturity date of the Note to July 31, 2013. We could prepay the Note in full or in part at any time prior to the maturity date without interest penalty. On December 31, 2012, we made a $3.0 million partial repayment to Mr. Roy bringing the remaining indebtedness to Mr. Roy to $2.8 million.

On July 31, 2013, we repaid the outstanding amount of $2.9 million owed to Mr. Roy and terminated the loan agreement. Interest expense on the related party notes was $0 and $56,000, respectively, for the three months ended March 31, 2014 and 2013. Interest expense on the related party notes was $19,000 and $278,000, respectively, for the nine months ended March 31, 2014 and 2013.