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NOTE 6 - NOTES PAYABLE | 12 Months Ended
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Dec. 31, 2015
Debt Disclosure [Abstract] |
Debt Disclosure [Text Block] | NOTE 6 - NOTES PAYABLE The following table summarizes our outstanding debt as of the dates indicated:
Notes Payable |  | Maturity |  | Stated Interest Rate |  |  | Balance as of December 31, 2015 |  |  | Balance as of December 31, 2014
Subordinated Notes Payable: Roomtag Acquisition Note |  | 10/31/2016 |  |  | 0.36 | % |  | $ | - |  |  | $ | 694 |
Term Loan - Wells Fargo |  | 3/31/2019 |  |  | 5.00 | % |  |  | 13,687 |  |  |  | 14,437 |
Total Notes Payable |  |  |  |  |  |  |  | $ | 13,687 |  |  | $ | 15,131 |
Short-term notes payable |  |  |  |  |  |  |  | $ | 1,031 |  |  | $ | 750 |
Long-term notes payable |  |  |  |  |  |  |  | $ | 12,656 |  |  | $ | 14,381 |
The following table summarizes the future principal payments related to our outstanding debt:
Year Ended |  | Gross Amount |
December 31, 2016 |  | $ | 1,031 |
December 31, 2017 |  |  | 1,406 |
December 31, 2018 |  |  | 1,500 |
December 31, 2019 |  |  | 9,750 |
Gross Notes Payable |  | $ | 13,687 |
Subordinated Notes Payable: Roomtag Acquisition Note In August 2014, we acquired substantially all the assets of Roomtag. The aggregate consideration for the assets consisted of (i) $933 in cash, and (ii) an unsecured subordinated promissory note (“Note”) for $754. We funded the $933 cash payment with proceeds from our credit agreement with Wells Fargo. The Note bears interest at an annual rate of 0.36% and is payable on October 31, 2016. We recorded the Note at fair value using a discount rate of 5%, which resulted in an original issue discount of $73, which will accrete up the note to its aggregate principal amount over the course of the life of the loan using the effective interest method. This Note is subordinated to our obligations under the Term Loan discussed below. In August 2015, we paid $722 to retire this Note in full, after applying a 5% discount. Term Loan - Wells Fargo In March 2014, we entered into a Credit Agreement with Wells Fargo Bank, N.A., as administrative agent, and the lenders that are party thereto. We used the proceeds of the term loan to finance the repayment of all amounts outstanding under our loan agreement with Deerpath and the payment of certain fees, cost and expenses related to the Credit Agreement. The Credit Agreement provides for a term loan in the amount of $15,000. The term loan will mature in March 2019. The outstanding principal amount of the term loan is payable as follows:
· | $188 on June 30, 2014 and the last day of each fiscal quarter thereafter up to March 31, 2016;
· | $281 on June 30, 2016 and the last day of each fiscal quarter thereafter up to March 31, 2017; and
· | $375 on June 30, 2017 and the last day of each fiscal quarter thereafter, with a final payment of the remaining balance due on March 31, 2019
The Credit Agreement also provides for a revolving loan commitment in the aggregate amount of up to $3,000. The outstanding principal amount of the revolving loan is due and payable in March 2019. Additionally, the Credit Agreement provides for a $10,000 uncommitted incremental term loan facility to support permitted acquisitions. In July 2014, we borrowed $1,500 under the revolver, which was used to fund a portion of the acquisition cost of all of the issued and outstanding shares of common stock of FotoPunch, Inc. In August 2014, we borrowed $1,000 under the revolver which was used to fund a portion of the acquisition cost of substantially all the assets of Roomtag, LLC. We repaid the balance on the revolver in 2014, leaving a balance of $0 at December 31, 2014. As of December 31, 2015, $0 was outstanding and $3,000 was available for borrowing under the revolver. The term loan and revolving loan will bear interest, at our option, at (i) the greater of 1% or LIBOR, plus an applicable margin or (ii) a base rate (as defined in the Credit Agreement) plus an applicable margin. We have elected to use the LIBOR rate plus the applicable margin, which was has remained constant at 5% since the inception of the loan. Interest is payable quarterly and the margin varies based upon our leverage ratio. See table below of applicable margin rates as of December 31, 2015.
Total Leverage Ratio |  | Base Rate Margin |  |  | LIBOR Rate Margin |
> 2.75:1.0 |  |  | 3.00 | % |  |  | 4.00 | %
< 2.75:1.0 but > 2.25:1.0 |  |  | 2.50 | % |  |  | 3.50 | %
< 2.25:1.0 |  |  | 2.00 | % |  |  | 3.00 | %
As discussed below, the Credit Agreement was amended in November 2015. See table below of applicable margin rates as of December 31, 2015.
Total Leverage Ratio |  | Base Rate Margin |  |  | LIBOR Rate Margin |
> 3.25:1.0 |  |  | 3.50 | % |  |  | 4.50 | %
< 3.25:1.0 but > 2.75:1.0 |  |  | 3.00 | % |  |  | 4.00 | %
< 2.75:1.0 but > 2.25:1.0 |  |  | 2.50 | % |  |  | 3.50 | %
< 2.25:1.0 |  |  | 2.00 | % |  |  | 3.00 | %
We may voluntarily prepay the principal amount outstanding under the revolving loan at any time without penalty or premium. However, we must pay a premium if we make a voluntary prepayment of outstanding principal under the term loan during the first two years following the closing date or if we are required to prepay outstanding principal under the Credit Agreement with proceeds resulting from certain asset sales or debt incurrence. The premium is 1% or 0.5% of the principal amount being prepaid depending on whether the prepayment occurs on or before the first anniversary of the closing date or subsequent to the first anniversary date through the second anniversary of the closing date. In addition, we are required to repay outstanding principal on an annual basis with 50% of excess cash flow, certain over advances, asset sale proceeds, debt proceeds, and proceeds from judgments and settlements. As of December 31, 2015, none of these payments were due. Under the Credit Agreement, we were required to maintain a fixed charge coverage ratio of not less than 1.5 to 1.0 beginning with the quarter ending June 30, 2014 and each calendar quarter thereafter, and a leverage ratio of not greater than 3.5 to 1.0 beginning with the quarter ending June 30, 2014 with the levels stepping down thereafter. We amended the Credit Agreement in August 2014, March 2015 and November 2015. The August 2014 amendment revised the leverage ratio beginning with the quarter ending September 30, 2014 to a leverage ratio of not greater than 3.6 to 1.0 with the levels stepping down thereafter. The March 2015 amendment authorized us to optionally prepay, subject to specified conditions, the Subordinated Note Payable to Roomtag and revised the leverage ratio beginning with the quarter ended March 31, 2015 to a leverage ratio of not greater than 3.5 to 1.0 with the levels stepping down thereafter. The November 2015 amendment increased the applicable margin relative to the LIBOR rate upon which we compute the interest payable. We agreed that if our leverage ratio is (a) less than or equal to 2.25:1, (b) greater than 2.25:1 but less than or equal to 2.75:1, (c) greater than 2.75:1 but less than or equal to 3.25:1 or (d) greater than 3.25:1, the applicable margin relative to the LIBOR rate would be 3.00, 3.50, 4.00 or 4.50 percentage points, respectively. We further agreed that until the leverage ratio testing period ending September 30, 2016, we will pay interest based on the 4.50 percentage point margin level. We amended the Credit Agreement in March 2016. Under this amendment, we expanded our overall credit facility by $12,500 to $29,188. The amendment also changes the applicable margin rates for determining the interest rate payable on the loan and amended our leverage ratio requirements under the Credit Agreement. We have now agreed to a leverage ratio not to exceed 5.00:1 at March 31, 2016, stepping down to 2.25:1 at December 31, 2018. See Note 14- Subsequent Events for more information about the amendment. The Credit Agreement contains customary affirmative and negative covenants, including, among others, limitations with respect to debt, liens, fundamental changes, sale of assets, prepayment of debt, investments, dividends, and transactions with affiliates. As of December 31, 2015, we were in compliance with all covenants, with the exception of the leverage ratio and fixed charge coverage ratio, and all payments remain current. A covenant waiver related to the leverage ratio and fixed charge coverage ratio was received from the lender as of December 31, 2015. As a result of the waiver, we were in compliance with all covenant requirements as of December 31, 2015. We expect to be in compliance or be able to obtain compliance through debt repayments with the available cash on hand or as we expect to be generated from the ordinary course of operations over the next twelve months. The Credit Agreement contains customary events of default, including, among others, payment defaults, covenant defaults, judgment defaults, bankruptcy and insolvency events, cross defaults to certain indebtedness, incorrect representations or warranties, and change of control. In some cases, the defaults are subject to customary notice and grace period provisions. In March 2014 and in connection with the Credit Agreement, we and our wholly-owned active subsidiaries entered into a Guaranty and Security Agreement with Wells Fargo Bank. Under the Guaranty and Security Agreement, we and each of our wholly-owned active subsidiaries have guaranteed all obligations under the Credit Agreement and granted a security interest in substantially all of our and our subsidiaries’ assets.

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- Definition 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. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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