Quarterly report pursuant to Section 13 or 15(d)

Debt

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Debt
6 Months Ended
Jun. 30, 2014
Debt

9. DEBT

Credit Facility

On June 24, 2013, the subsidiaries of SLP entered into a $15,000 credit facility with City National Bank. The subsidiaries of SLP are the borrowers under such facility and SLP guarantees the obligations of its subsidiaries under the credit facility. The credit facility is secured by certain assets of SLP and its subsidiaries. The credit facility consists of a $7,500 delayed draw term loan that matures on June 24, 2020 and a $7,500 revolving credit facility that matures on December 24, 2016. The loan bears interest at either (a) the higher of the prime rate plus a margin of 0.05 percentage points and 2.5% or (b) the LIBOR rate plus 3 percentage points, at the borrowers’ option. On June 28, 2013, the borrowers borrowed $7,000 on the revolving credit loan. As of June 30, 2014 and December 31, 2013, no amount has been drawn on the term loan credit facility and the borrowers may draw up to the full amount of the term loan through June 25, 2018. Borrowings under the term loan on or prior to June 24, 2015 will be payable in 20 equal quarterly installments. Borrowings under the term loan after June 24, 2015 will be payable in equal quarterly installments through the maturity date. The credit facility contains restrictions on, among other things, (i) incurrence of additional debt, (ii) creating liens on certain assets, (iii) making certain investments, (iv) consolidating, merging or otherwise disposing of substantially all of our assets, (v) the sale of certain assets, and (vi) entering into transactions with affiliates. In addition, the credit facility contains certain financial covenants including a test on discretionary assets under management, maximum debt to EBITDA and a fixed charge coverage ratio. The credit facility contains customary events of default, including the occurrence of a change in control which includes a person or group of persons acting together acquiring more than 30% of the total voting securities of Silvercrest.

As of June 30, 2014 and December 31, 2013, $3,000 of principal was outstanding under the revolving credit loan.

The interest rate on the revolving credit loan as of June 30, 2014 was 3.75%.  Interest expense, which also includes amortization of deferred financing fees, incurred on the revolving credit and term loans for the three months ended June 30, 2014 and 2013 was $37 and $2, respectively. Interest expense, which also includes amortization of deferred financing fees, incurred on the revolving credit and term loans for the six months ended June 30, 2014 and 2013 was $74 and $2, respectively.

Notes Payable

The following is a summary of notes payable:

 

 

  

June 30, 2014

 

 

  

Interest Rate

 

 

Amount

 

Principal on fixed rate notes

  

 

5.0

 

$

2,570

  

Variable rate notes issued for redemption of partners’ interests (see Note 15)

  

 

Prime plus 1

%

 

 

5,300

  

Interest payable

  

 

 

 

 

 

294

  

Total, June 30, 2014

  

 

 

 

 

$

8,164

  

 

 

  

December 31, 2013

 

 

  

Interest Rate

 

 

Amount

 

Principal on fixed rate notes

  

 

5.0

 

$

2,665

  

Variable rate notes issued for redemption of partners’ interests (see Note 15)

  

 

Prime plus 1

%

 

 

5,486

  

Interest payable

  

 

 

 

 

 

152

  

Total, December 31, 2013

  

 

 

 

 

$

8,303

  

The carrying value of notes payable approximates fair value. The variable rate notes are based on a multiple of the U.S. Prime Rate.

As of June 30, 2014, future principal amounts payable under the fixed and variable rate notes are as follows:

 

2014 (remainder of)

  

$

2,338

  

2015

  

 

2,314

  

2016

  

 

1,751

  

2017

  

 

1,467

  

Total

  

$

7,870