Note Receivable

AMSC entered into a purchase and sale agreement dated

February 1, 2018

for the Devens facility (including land, building and building improvements) located at

Jackson Road, Devens, Massachusetts to

Jackson Road, LLC, a limited liability company, in the amount of

$23.0

million. The terms for payment included a

$1.0

million security deposit, and a note receivable for

$6.0

million payable to AMSC with the remaining cash net of certain adjustments for closing costs at the date of settlement.

The note receivable was due in

two

$3.0

million installments plus accrued interest at

1.96%

rate. The

first

installment was paid on

March 28, 2019

and the

second

installment was paid

May 23, 2019.

The note was subordinate to East Boston Savings Bank's mortgage on the Devens property. The note receivable was discounted to its present value of

$5.7

million utilizing a discount rate of

6%,

which was based on management’s assessment of what an appropriate loan at current market rate would be. The

$0.3

million discount was recorded as an offset to the long term portion of the note receivable. As of

March 31, 2019,

the remaining

$0.1

million discount was being amortized to interest income as an offset to the short-term portion of the note, over the remaining term of the note.

In addition, the resulting gain of

$0.1

million from the sale of the Devens property which was deferred previously was recorded as a component of the cumulative effect of an accounting change upon the adoption of ASU

2017

which was issued as a part of ASU

2014

09.

This gain was recorded as an offset to the opening accumulated deficit as of

April 1, 2018.

Note receivable as of

March 31, 2019

consisted of the following (in thousands):

	March 31, 2019
Current assets
Note receivable, current	$	3,000
Note receivable discount		(112	)
Total current note receivable	$	2,888

Long term assets
Note receivable, long term	$	—
Note receivable discount		—
Deferred gain on sale		—
Total long term note receivable	$	—