Debt

6 Months Ended

Jun. 30, 2020

Debt Disclosure [Abstract]

Debt

Note 6 — Debt

Debt and notes payable consists of the following:

	June 30,			December 31,
	2020			2019
	(In millions)
Pension liability	$	—		$	13.5
Stock purchase agreement notes payable (see Note 14 – Related Party Transactions)		17.6			17.6
Orix notes payable		29.0			13.0
Deferred financing costs		(2.4	)		(2.7	)
Bank loan		0.4			—
Other related parties notes payable		0.4			—
Other liabilities		0.1			0.2
Total long term debt		45.1			41.6

Stock purchase agreement notes payable bear interest at a 5% annual rate and mature on December 12, 2022. The interest under the notes is payable in arrears on the first day of each calendar quarter, or, at the Company’s option, in shares of common stock of the Company at a price reflecting market value.

The Company has multiple notes payable with Orix. Notes payable of $16 million issued in March 2020 bear interest at a 5.0% annual rate and mature on September 18, 2021.

Prior Orix notes payable of $13 million bear interest at a 7.5% annual rate and mature on September 30, 2026. Principal payments are due annually, commencing on March 31, 2021, and thereafter on March 31 of each year until maturity. The first two principal installments are $5,000,000 each and the remaining installments are $750,000 each. All accrued interest is due and payable in arrears, commencing on September 30, 2020, and thereafter on September 30 of each year until maturity.

On July 21, 2020, pursuant to a loan prepayment and security termination agreement, the Company prepaid the $16 million notes payable issued in March 2020 to Orix, together with accrued interest of $171,112. The prior Orix notes payable of $13 million was assigned from Adara Enterprises Corp. to Adara Asset Management LLC, which was ultimately sold to GEH Sport LLC, a related party, and, in effect, no longer an obligation of the Company. See Note 15 – Subsequent Events, for further information about these transactions.

On May 5, 2020, the Company received funds under a loan (the “Bank Loan”) from Signature Bank (the “Lender”) in the aggregate amount of $374,065, pursuant to the Paycheck Protection Program (the “PPP”) under Division A, Title I of the CARES Act, which was enacted March 27, 2020. The Bank Loan, which was in the form of a note, dated April 30, 2020, issued by the Lender, matures on April 30, 2022 and bears interest at a rate of 1.00% per annum, payable monthly commencing on November 30, 2020. The note may be prepaid by the Company at any time prior to maturity with no prepayment penalties. Under the terms of the PPP, certain amounts of the Bank Loan may be forgiven as long as the Company uses the proceeds for eligible purposes, including payroll, benefits, rent and utilities. The Company intends to use the entire Bank Loan amount for qualifying expenses.

Other related parties notes payable of $0.4 million is comprised of Demand Notes 4, 5 and 6 described below.

On June 30, 2020, SportBLX issued an unsecured demand note to Clinton Special Opportunities Fund LLC (“CSO”), a related party, in the aggregate principal amount of $150,000 (the Demand Note-4”). The Demand Note-4 bears interest at an 8% annual rate and matures upon the earlier to occur of (a) demand by CSO, or (b) July 1, 2021. As of June 30, 2020 SportBLX borrowed $150,000 under the Demand Note-4.

On June 30, 2020, SportBLX issued an unsecured demand note to Mr. De Perio, a related party, in the aggregate principal amount of $40,000 (the Demand Note-5”). The Demand Note-5 bears interest at an 8% annual rate and matures upon the earlier to occur of (a) demand by Mr. De Perio, or (b) July 1, 2021. As of June 30, 2020 SportBLX borrowed $40,000 under the Demand Note-5.

On June 30, 2020, SportBLX issued an unsecured demand note to Sport-BLX Securities, Inc. (“Securities”), a related party, in the aggregate principal amount of $213,793 (the Demand Note-6”). The Demand Note-6 bears interest at an 8% annual rate and matures upon the earlier to occur of (a) demand by Securities, or (b) July 1, 2021. As of June 30, 2020 SportBLX borrowed $213,793 under the Demand Note-6.

Scheduled maturities of the Company’s long-term debt, as they exist as of June 30, 2020, in each of the next five fiscal years and thereafter are as follows:

Fiscal years ending in	(in millions)
2020	$	—
2021		21.4
2022		22.9
2023		0.8
2024		0.8
2025 and thereafter		1.5
Total		47.4