Debt

Notes payable consists of the following (in thousands):



	June 30, 2017			December 31, 2016
Line of credit with FGI	$	672		$	1,458
$2.0 million, 8% shareholder note due 2017 (Kanis S.A.) (1)	—			1,803
	672			3,261
Less current portion	(672		)	(3,261		)
	$	—		$	—


(1)	Debt discount related to extinguishment and amendment of previous outstanding debt. The aggregate amount of unamortized debt discount was $0.2 million at December 31, 2016. For additional information, refer to the respective discussions below.

Line of credit with FGI

The Company maintains a $7.5 million secured demand facility with FGI backed by its receivables and inventory. The Company also granted FGI a first lien collateral interest in substantially all of its assets. The current termination date is August 15, 2017, however it may be extended at the Company's option for additional one-year terms. FGI can cancel the facility at any time and demand payment.

The interest rate on advances or borrowings under the FGI facility is the greater of (i) 6.50% per annum and (ii) 2.50% per annum above the prime rate, as defined in the FGI facility and was 6.50% at June 30, 2017 and December 31, 2016. Any advances or borrowings under the FGI facility are due on demand.

At June 30, 2017, the Company had $0.4 million gross accounts receivable pledged to FGI as collateral for short-term debt as well as $0.3 million in borrowings outstanding against eligible inventory. The Company was in compliance with the terms of the FGI Facility at June 30, 2017 and December 31, 2016. However, there is no guarantee that the Company will be able to borrow to the full limit of $7.5 million if FGI chooses not to finance a portion of the Company’s receivables or inventory.

Kanis S. A. Indebtedness

On April 1, 2016, the Company borrowed $2.0 million from Kanis S.A. pursuant to a promissory note with an interest rate of 8% per annum and a maturity date of September 30, 2017 (see Note 17).

In January 2017, the Company repaid the entire $2.0 million balance and recorded a loss on extinguishment of $0.2 million.