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Note 14 - Debt | 12 Months Ended
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Dec. 31, 2016
Notes to Financial Statements |
Long-term Debt [Text Block] |
( 14 ) | Debt
Long-term obligations consists of the following (in thousands):
|  | December 31, |
|  | 2016 |  |  | 2015 |
Current: |  |  |  |  |  |  |  |
Revolving Credit facility |  | $ | 0 |  |  | $ | 2,132 |
Current portion of long term debt |  |  | 0 |  |  |  | 1,714 |
Current portion of capital lease obligation |  |  | 208 |  |  |  | 0 |
Current debt and capital lease obligation |  | $ | 208 |  |  | $ | 3,846 |
Long Term: |  |  |  |  |  |  |  |
Term loan |  | $ | 0 |  |  | $ | 10,000 |
Note payable – related party |  |  | 6,500 |  |  |  | 5,500 |
Capital lease obligation |  |  | 2,950 |  |  |  | 0 |
Less unamortized debt issuance and modification costs |  |  | (125 | ) |  |  | (1,220 | )
Long term debt and capital lease obligations, net of unamortized debt costs |  | $ | 9,325 |  |  | $ | 14,280 |
The weighted average interest rate for outstanding borrowings at December 31, 2016 was 8.0%. The weighted average interest rates for borrowings during the years ended December 31, 2016 and 2015 were 10.4% and 7.2%, respectively. The Company had no capitalized interest in 2016 or 2015. Interest paid during the years ended December 31, 2016 and 2015 totaled approximately $3,579,000 and $1,436,000, respectively. Note Payable – Related Party During 2015, the Company received the proceeds of subordinated indebtedness from GFCM in an amount of $5,500,000. On February 26, 2016, the Company further amended the GFCM note to increase the amount by $1,000,000 to $6,500,000. GFCM is an entity controlled by the Company’s chairman, president and chief executive officer, Jeffrey T. Gill and one of our directors, R. Scott Gill. GFCM, Jeffrey T. Gill and R. Scott Gill are significant beneficial stockholders of the Company. The promissory note bears interest at a rate of 8.0% per year and the principal is due on January 30, 2019. On September 30, 2016, the Note was amended to begin paying interest on a quarterly basis. Obligations under the Note Payable are guaranteed by all of the U.S. subsidiaries and are secured by a first priority lien on substantially all assets of the Company. Revolving Credit Facility and Term Loan On October 30, 2015, the Company secured debt financing consisting of a $12,000,000 term loan (“Term Loan”) and a $15,000,000 revolving credit facility (“Revolving Credit Facility”). Proceeds from the two new financing arrangements (collectively the “Loan Agreements”) were used in part to repay the senior secured debt with a prior lender and the Meritor Note. On February 25, 2016, the Company entered into an amendment (the “Term Loan Amendment”) to the Term Loan and an amendment (the “Revolving Credit Amendment”) to the Revolving Credit Facility (together, the “Amendments”). The Amendments increased the Company’s borrowing capability under its Revolving Credit Facility and provided for an agreement on the use of proceeds from the sale of its Toluca, Mexico property and buildings, as described below. As a result of the Term Loan Amendment, the Company deposited $6,000,000 of the proceeds of the sale-leaseback of its Toluca, Mexico property and buildings (the “Toluca Sale-Leaseback”) into a Cash Collateral Account, to be held as additional collateral for the Term Loan. The Term Loan Amendment also permitted the Company to retain the remaining balance of the proceeds from Toluca Sale-Leaseback, and increased the interest rate of the Term Loan by 1.0%. On August 16, 2016, the Company repaid the Term Loan in full and paid down the outstanding balance under the Revolving Credit Facility with proceeds generated from the CSS Sale (see Note 4). In connection with the repayment of the Term Loan, the $6,000,000 held in the Cash Collateral Account was released. Additionally, on September 2, 2016, the Company terminated and paid all remaining obligations due under the Revolving Credit Facility. As a result of the early extinguishment of debt, the Company was required to pay $1,521,000 in penalties, which is included in loss on extinguishment of debt in the accompanying statements of operations, and wrote off the remaining amount of deferred loan costs associated with the Term Loan and Revolving Credit Facility, which is included in interest expense, net in the accompanying statements of operations. The classification of debt as of December 31, 2015 considers debt outstanding under the Loan Agreements on a long-term basis. However, the Revolving Credit Facility allowed the lender to establish certain reserves against the borrowing base which could, under certain circumstances, cause a potential event of default. Because such an event is not objectively measureable in advance and because the Company was required to maintain a lock-box arrangement, ASC 470 - 10 - 45 requires the otherwise long-term revolving advances to be classified as a current liability. As a result, all borrowings under the Revolving Credit Facility were classified in the accompanying consolidated balance sheets as a current liability. Capital Lease Obligation On March 9, 2016, the Company completed the sale of its 24 -acre Toluca property pursuant to an agreement with Promotora y Desarrolladora Pulso Inmobiliario, S.C. (together with its affiliates and assignees, “Buyer”) for 215,000,000 Mexican Pesos, or approximately $12,182,000 in U.S. currency. Simultaneously, the Company entered into a long-term lease of the 9 acres and buildings currently occupied by the Company and needed for its ongoing business in Toluca (see Note 5). The Company incurred transaction related expenses of $1,116,000. The Company recorded an initial gain on the sale of $2,370,000 during the year ended December 31, 2016, which is included in other income, net in the consolidated income statement, and recorded a deferred gain of $4,368,000 as of December 31, 2016, which will be recognized over the ten year lease term. The Company’s base rent, which is denominated in U.S. currency, is $936,000 annually, adjusted based on U.S. CPI with certain cap conditions. As a result of the Toluca Sale-Leaseback, the Company has a capital lease obligation of $3,158,000 for the building. The future minimum payments for the capital lease as of December 31, 2016 are as follows (in thousands):
2017 |  | $ | 503 |
2018 |  |  | 549 |
2019 |  |  | 549 |
2020 |  |  | 503 |
2021 |  |  | 548 |
Thereafter |  |  | 2,242 |
Total future payments |  |  | 4,894 |
Less: Amount representing interest |  |  | (1,736 | )
Present value of future minimum payments |  |  | 3,158 |
Less: Current portion |  |  | (208 | )
Long term portion |  | $ | 2,950 |
Note Payable – Meritor On July 2, 2015, the Company entered into a secured promissory note (the “Meritor Note”) in the principal amount of $3,047,000, with Meritor, in exchange for the release of certain outstanding net trade payables owed to Meritor for ongoing purchases of raw materials and the guarantee of certain inventory values related to Meritor’s business as collateral under the Credit Facility. The Meritor Note was secured by substantially all of the collateral for the Credit Facility, was senior to the promissory note previously issued to GFCM and was subordinate to the rights under the Credit Facility. The Meritor Note bore interest at a rate of 10.0% per year and all principal and interest on the Meritor Note was due and payable on the maturity date. On July 9, 2015, the Company entered an asset purchase agreement to sell certain assets and related liabilities used in the Company’s manufacturing facility in Morganton, North Carolina, to Meritor for $12,500,000. Meritor also agreed to purchase the Morganton plan facility and real estate for $3,200,000. At closing, the parties also entered into a Meritor Note Amendment, whereby the Company issued an additional secured obligation to Meritor of $412,000 on July 9, 2015 for the release of certain outstanding net trade payables and other accrued liabilities and further agreed to increase the Meritor Note by an additional $321,000 in September to reflect certain potential roof repairs required at the Morganton facility. On October 30, 2015, the Meritor Note and interest were repaid in full in conjunction with the Company’s new financing agreements.

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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