Notes Payable and Accrued Interest

9 Months Ended

Sep. 30, 2016

Notes Payable and Accrued Interest [Abstract]

Notes Payable and Accrued Interest

4.Notes Payable and Accrued Interest

At September 30, 2016 and December 31, 2015, the Company's notes payable and accrued interest consisted of the following:

	September 30, 2016			December 31, 2015
Credit Facility:
Principal	$	110,100,000		$	110,400,000
Unamortized debt issuance costs		(2,220,200	)		(2,814,000	)
Accrued interest		80,000			35,600
Special purpose financing:
Principal		18,623,600			-
Accrued interest		30,000			-
	$	126,613,400		$	107,621,600

(a)Credit facility

The Company's $150 million Credit Facility is provided by a syndicate of banks and is secured by all of the Company's assets, including its aircraft and engine portfolio.  The Credit Facility, which expires on May 31, 2019, may be expanded to a maximum of $180 million.  The Company was in compliance with all covenants under the Credit Facility at September 30, 2016 and December 31, 2015.

The unused amount of the Credit Facility was $39,900,000 and $39,600,000 as of September 30, 2016 and December 31, 2015, respectively.

The weighted average interest rate on the Credit Facility was 3.93% and 3.80% at September 30, 2016 and December 31, 2015, respectively.

(b)Special purpose financing

In August 2016, the Company acquired two regional jet aircraft using cash and financing separate from its Credit Facility.  The financing resulted in note obligations of $9,805,600 and $9,804,300, which are being paid from a portion of the rent payments on the related aircraft leases through October 3, 2020 and November 7, 2020, respectively, and which bear interest at the rate of 4.455%.  The borrower under each note obligation is the special purpose entity that owns each aircraft.  The notes are collateralized by the aircraft and are recourse only to the special purpose entity borrower and its aircraft asset, subject to standard exceptions for this type of financing.  Payments due under the notes consist of quarterly principal and interest.  The combined balance of the notes payable and accrued interest on these notes at September 30, 2016 was $18,653,600.