Note 18 - Notes Payable

9 Months Ended

Sep. 30, 2018

Notes to Financial Statements

Debt Disclosure [Text Block]

18.

NOTES PAYABLE

Notes payable is summarized as follows:

(in thousands)	As of September 30, 2018		As of December 31, 2017
Mortgage note payable (1)	$	3,279	$	3,350
Acquisition Note Payable - related party (2)		5,304		5,304
Total Notes Payable	$	8,583	$	8,654

( 1 ) On October 1, 2013, the purchase of the Company’s Tualatin, Oregon corporate offices was completed for $5.1 million. The purchase was funded, in part, by a promissory note payable to Wells Fargo Bank in the amount of $3.7 million plus interest at the rate of 2% above LIBOR, payable over ten years with a balloon payment due at maturity. It was secured by a deed of trust on the purchased property which was executed by CUI Properties, LLC and guaranteed by CUI Global, Inc. During the nine months ended September 30, 2018, the Company made principal payments of $71 thousand against the mortgage promissory note payable. At September  30, 2018, the balance owed on the mortgage promissory note payable was $3.3 million, of which $97 thousand and $3.2 million were in current and long-term liabilities, respectively. See Note 16, Working Capital Line of Credit and Overdraft Facility, for more information on the Company's debt covenants.

( 2 ) The note payable to International Electronic Devices, Inc. (formerly CUI, Inc.) is associated with the acquisition of CUI, Inc. The promissory note is due May 15, 2020 and includes a 5% interest rate per annum, with interest payable monthly and the principal due as a balloon payment at maturity. The note contains a contingent conversion feature, such that in the event of default on the note the holder of the note can, at the holder’s option, convert the note principal into common stock at $0.001 per share. As of September  30, 2018, the Company is in compliance with all terms of this promissory note and the conversion feature is not effective.