Bank Indebtedness and Production Facilities |
3 Months Ended |
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Mar. 31, 2024 | |
| Debt Instruments [Abstract] | |
| Bank Indebtedness and Production Facilities | Bank Indebtedness and Production Facilities The Company has certain credit facilities (together, the “Facilities”) that are comprised of the following:
Revolving Demand Facility
As of December 31, 2023, the Company had an outstanding balance of $2.9 million (CAD 3.8 million) on the revolving demand facility by way of bank prime rate loan draws, included as Bank Indebtedness within current liabilities on the Company’s condensed consolidated balance sheets. During the three months ended March 31, 2024, the Company paid the outstanding balance.
During March 2024, the Company amended the revolving demand facility. As a result of the amendment, the revolving demand facility allows for draws of up to CAD 1.0 million to be made by way of CAD prime rate loans, CAD overdrafts, USD base rate loans or letters of credit up to a maximum of $200,000 in either CAD or USD and having a term of up to 1 year. The CAD prime borrowings and overdrafts bear interest at a rate equal to bank prime plus 2.00% per annum. The USD base rate borrowings bear interest at a rate equal to bank base rate plus 2.00% per annum.
Treasury Risk Management Facility
During March 2024, an amendment was entered into that removed the treasury risk management facility.
Production Facilities
The production facilities are used for financing specific productions. The Company’s production facilities bear interest at rates ranging from bank prime plus 1.00% - 1.25% per annum. The production facilities are generally repayable on demand and are guaranteed and secured by the Company with no limitations for maximum potential future payments. The security reflects substantially all of the Company's tangible and intangible assets including a combination of federal and provincial tax credits, other government incentives, production service agreements and license agreements.
As of March 31, 2024 and December 31, 2023, the Company had an outstanding balance of USD 8.3 million (CAD 11.2 million), including USD 1.1 million (CAD 1.5 million) of interest, and USD 15.3 million (CAD 20.3 million), including USD 1.4 million (CAD 1.9 million) of interest, respectively, recorded as Production Facilities, net within current liabilities on the Company’s condensed consolidated balance sheets.
Equipment Lease Line
During March 2024, the equipment lease line was terminated, however, the Company has and will continue to make the regular principal and interest payments under the specific financing terms of the existing equipment lease agreements. Each existing transaction under the equipment lease line has specific financing terms in respect of the leased equipment such as term, finance amount, rate, and payment terms. The finance rates for these equipment leases range from 4.19% to 7.18% with remaining lease terms of 4 - 28 months as of March 31, 2024.
As of March 31, 2024, the outstanding balance of $1.0 million (CAD 1.4 million) was included within current and noncurrent Finance Lease Liabilities on the Company’s condensed consolidated balance sheets.
Equipment Lease Facility
The Company also entered into an equipment lease agreement with a Canadian bank. This additional equipment lease facility allows the Company to finance equipment purchases of up to CAD 1.4 million in total. Each transaction under the equipment lease line has specific financing terms in respect of the leased equipment such as term, finance amount, rate, and payment terms. As of March 31, 2024, the Company has leases remaining under this facility with finance rates of 7.52% to 8.20% and remaining lease terms of 20 - 29 months.
As of March 31, 2024, the outstanding balance of $0.5 million (CAD 0.7 million) was included within current and noncurrent Finance Lease Liabilities on the Company’s condensed consolidated balance sheets.
As of March 31, 2024, the Company met all required financial and non-financial covenants.
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