Long-Term Debt

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

11.  Long-Term Debt

Long-term debt consists of the following:

In thousands	2015		2014
8¼% Limited convertible senior subordinated notes due 2012	$	626	$	1,083
9½% Subordinated debentures due 2012		334		334
Real estate mortgage – secured, due in monthly installments  through 2020		333		394
Long-term debt, including current portion		1,293		1,811
Less portion due within one year		1,031		1,811
Long-term debt	$	262	$	-

Payments of long-term debt due for the next five years are:

In thousands	2016	2017	2018	2019	2020
	$1,031	$75	$80	$85	$22

The Company has outstanding $626,000 of Notes which are no longer convertible into common shares.  The Notes matured as of March 1, 2012 and are currently in default.  As of December 31, 2015 and 2014, the Company had accrued $327,000 and $477,000, respectively, of interest related to the Notes, which is included in Accrued Liabilities in the Consolidated Balance Sheets.  The trustee, by notice to the Company, or the holders of 25% of the principal amount of the Notes outstanding, by notice to the Company and the trustee, may declare the outstanding principal plus interest due and payable immediately.

On December 22, 2015, the Company consummated a transaction with fourteen holders of the Notes in which an aggregate of $457,000 of principal under the Notes was exchanged for an aggregate of $228,500 cash and an aggregate of 38,082 shares of Common Stock valued at $152,000.  As part of the exchange agreements, all of the Company’s remaining obligations under the exchanged Notes, including the payment of accrued interest of $238,000, were terminated.  The Company recorded a gain on extinguishment of debt of $314,000.  The exchange agreements also provide the note holders with piggyback registration rights with respect to the resale of the shares of Common Stock that they received under the exchange agreements.

The Company has outstanding $334,000 of Debentures.  The Debentures matured as of December 1, 2012 and are currently in default.  As of December 31, 2015 and 2014, the Company had accrued $193,000 and $161,000, respectively, of interest related to the Debentures, which is included in Accrued Liabilities in the Consolidated Balance Sheets.  The trustee, by notice to the Company, or the holders of 25% of the principal amount of the Debentures outstanding, by notice to the Company and the trustee, may declare the outstanding principal plus interest due and payable immediately.

On April 23, 2015, the Company entered into a Credit Agreement (the “Credit Agreement”) with BFI Capital Fund II, LLC (“Lender”) for a $1.5 million credit line at a fixed rate of interest of 12.00%, with a maturity date of May 1, 2016, which was satisfied and terminated on November 23, 2015. The Company had borrowed $1.0 million under the Credit Agreement, which has been used for working capital. The funds utilized to make the loan included $500,000 of funding provided by Marco Elser, a director of the Company, to the Lender. The Company also issued the Lender a warrant to purchase 10,000 shares of Common Stock at an exercise price of $12.00 per share. The Company recorded the fair value of the warrant in the amount of $21,000, as well as deferred financing fees of $31,000. These deferred financing fees have been amortized over the term of the agreement. For the year ended December 31, 2015, amortization expense of the deferred financing fees in the amount of $52,000 was recorded in Interest expense, net in the Consolidated Statement of Operations.

As of December 31, 2014, the Company, through a subsidiary, had a $394,000 mortgage on its facility in Des Moines, Iowa, which was due to mature on March 1, 2015, had a fixed rate of interest of 6.50% and required an average minimum monthly compensating balance of $200,000.  On March 1, 2015, the mortgage was amended, extending the maturity to March 1, 2020, reducing the fixed rate of interest to 5.95% and reducing the average minimum monthly compensating balance to $100,000.  As of December 31, 2015, the mortgage had a balance of $333,000.  On February 1, 2016, the Des Moines facility was sold in a sale/leaseback transaction and the mortgage was satisfied.  See Note 20 – Subsequent Events for further details.