9.	Line of Credit and Long-Term Debt

Long-term debt consists of the following (in thousands):

	As of December 31,
	2016			2015
Equipment-based Facility	$	3,532		$	17,957
Less deferred loan costs		(803	)		(1,119	)
Equipment-based Facility, Net		2,729			16,838
Notes payable for transportation and construction equipment and other		2,665			3,342
		5,394			20,180

Current maturities of long-term debt		4,648			5,192
Less current deferred loan costs		(803	)		(336	)
Less current maturities of long-term debt, net		(3,845	)		(4,856	)
Total long-term debt	$	1,549		$	15,324

Equipment-based Facility

May

2015,

the Company and its wholly-owned subsidiaries entered into a

$40.0

million loan and security agreement with Nations, consisting of a

$20.0

million Term Loan and a

$20.0

million Revolving Loan (combined, the “Equipment-based Facility”), which replaced its Prior Credit Facility. The sum of the outstanding balances of the Equipment-based Facility

may

not exceed the lesser of

$40.0

million or

65%

of the appraised value of the collateral pledged for the loans. At

December

31,

2016,

the Company had a borrowing base of approximately

$24.4

million, which was the result of calculating

65%

of the appraised value (where appraised value equals net operating liquidated value) of the Company’s collateral. The amount of the Revolving Loan that

may

be borrowed from time to time is the lesser of

$20.0

million or the available borrowing base. However, as a result of the

$10.0

million in principal payments made to our Term Loan during the year, as discussed below, we have reached our

$20.0

million revolver cap, and therefore, only

$20.0

million of borrowings were available at

December

31,

2016.

The Revolving Loan

may

be utilized by the Company to provide ongoing working capital and for other general corporate purposes.

The Equipment-based Facility bears interest at an initial fixed annual rate of

12%,

which is subject to (i) a decrease of up to

two

percentage points based on the Company's fixed charge coverage ratio for each of the most recently ended

four

quarters beginning with the

four

quarters ending

June

30,

2016;

and (ii) an increase of up to

two

percentage points beginning

December

31,

2015

based on the fixed charge coverage ratio at the end of the following

four

quarters. The interest rate has not changed since inception and continues to be

12%.

Principal on the Term Loan is payable in

monthly installments (with accrued interest) with a final payment of the then outstanding principal amount on

May

29,

2019.

The Term Loan

may

be prepaid in any year, but subject to a pre-payment fee that declines as the Term Loan nears maturity. Outstanding Revolving Loans are payable in full

thirty

days before the maturity date of the Term Loan.

The Equipment-based Facility is secured by all of the Company's personal property except accounts receivable, including all of its construction equipment, which forms the basis of availability under the Revolving Loan. The Equipment-based Facility is also secured by

one

-half of the equipment of the Company's

50%

-owned affiliates, Road and Highway Builders, LLC and Myers & Sons Construction, L.P. pursuant to a separate security agreement with those entities. If a default occurs, Nations

may

exercise the Company's rights in the collateral, with all of the rights of a secured party under the Uniform Commercial Code, including, among other things, the right to sell the collateral at public or private sale.

The proceeds of the Term Loan of

$20.0

million and our initial draw of

$14.6

million under the Revolving Loan were utilized by the Company to repay the balance outstanding and terminate the Prior Credit Facility and for other general corporate purposes. In addition, in connection with incurring this debt, we recorded

$1.3

million in deferred debt issuance costs which were included in “Long-term debt, net of current maturities” and “Current maturities of long-term debt” in our consolidated balance sheet, which is being amortized on a straight line basis over the term of the Equipment-based Facility.

The Company’s Equipment-based Facility has no financial covenants; however, it contains restrictions on the Company’s ability to:

Incur liens and encumbrances on equipment;

Incur further indebtedness;

Dispose of a material portion of assets or merge with a

third

party;

Make acquisitions; and

Make investments in securities.

Due to this new Equipment-based Facility agreement, the Company’s Letter of Credit, which under our Prior Credit Facility reduced the Company’s borrowing availability, is now collateralized with cash. Refer to Note

for more information regarding the Company’s cash and cash equivalents including restricted cash used as collateral.

During

2016,

the Company prepaid

$10.0

million of the principal balance of our Term Loan and paid approximately

$0.3

million as prepayment fees which were recorded as “Interest expense” in our consolidated statement of operations. There were no prepayments made to the Term Loan in

2015.

Interest expense related to our Equipment-based Facility was

$2.6

million for the

2016

fiscal year compared to

$2.9

million and

$1.0

million in the

2015

and

2014

fiscal years, respectively. The decrease in interest expense for

2016

was due to the decreased debt outstanding during the period offset by the prepayment fees noted above.

December

31,

2016,

the Company had no amounts drawn on the Revolving Loan,

$3.5

million outstanding under the Term Loan and

$20.0

million of borrowings available. At

December

31,

2015,

the Company had no amounts drawn on the Revolving Loan,

$18.0

million outstanding under the Term Loan and

$11.6

million of borrowings available.

Fair Value

The Company’s debt is recorded at the carrying amount in the consolidated balance sheets. The Company uses an income approach to determine the fair value of its

12%

Term Loan due

May

29,

2019

using estimated cash flows, which is a Level

fair value measurement. As of

December

31,

2016

and

2015,

the carrying values approximated fair values and were

$3.5

million and

$18.0

million, respectively, for the Term Loan. There were no amounts outstanding on the Revolving Loan as of

December

31,

2016

and

2015.

In order to extinguish our Prior Credit Facility debt, the Company incurred costs of

$0.2

million which were included in “Loss on extinguishment of debt” in the Company’s

2015

consolidated statement of operations.

Notes Payable for Transportation and Construction Equipment

The Company has purchased and financed various transportation and construction equipment to enhance the Company’s fleet of equipment. The total long-term notes payable, including current maturities of long-term debt, related to the purchase of financed equipment was

$2.7

million at

December

31,

2016,

and

$3.3

million at

December

31,

2015.

The purchases have payment terms ranging from

years and the associated interest rates range from

3.12%

6.92%.

Maturities of Debt

The Company’s long-term obligations mature in future years as follows (amounts in thousands):

Years Ending December 31,	Amount
2017	$	3,845
2018		920
2019		566
2020		59
2021		4
Thereafter		--
	$	5,394

The long-term obligations above include

$0.4

million related to

two

capital leases outstanding as of

December

31,

2016.

See Note

for more information regarding our capital leases.