DEBT

In connection with our acquisition of Opengear, we entered into a syndicated credit agreement with BMO Harris Bank N.A. (“BMO”) on December 13, 2019. This agreement provided us with committed credit facilities (the “Credit Facility”) totaling $150 million, consisting of (i) a $50 million term loan (the “Term Loan”) and (ii) a $100 million revolving loan (the “Revolving Loan”).

Borrowings under the Credit Facility bear interest rates based on an underlying variable benchmark plus applicable margin based on our total leverage. Interest rates for both the Term Loan and Revolving Loan reset quarterly. Our weighted average interest rate for the three months ended December 31, 2019 was 4.5%.

In addition to paying interest on the outstanding balance under the Credit Facility, we are required to pay a commitment fee on the non-utilized commitments thereunder. We also incurred debt issuance costs under the Credit Facility of $2.6 million in the first quarter of fiscal 2020, which is being amortized using the straight-line method over the term of the loan. Both the commitment fee and the amortization costs of the debt issuance costs are reported in interest expense.

Amounts under the Term Loan will be repaid in quarterly installments on the last day of each fiscal quarter, with amortization of 5% in the first two years, 7.5% in the next two years and 10% in the final year. The remaining outstanding balance will mature on December 13, 2024. The Revolving Loan is due in a lump sum payment at maturity on December 13, 2024.

Our Term Loan and Revolving Loan contains two financial covenants that require us to stay below a maximum debt-to-earnings before interest, taxes, depreciation and amortization (“EBITDA”) ratio and maintain a minimum ratio of interest expense-to-EBITDA. Both ratios are computed quarterly, with EBITDA calculated on a rolling four-quarter basis.

The fair values of the Term Loan and Revolving Loan approximated carrying value at December 31, 2019, due to the variable interest rates on these instruments.

The following table is a summary of our long-term indebtedness at December 31, 2019 (in thousands):



Revolving loan	$	60,000
Term loan	50,000
Total loans	110,000
Less unamortized issuance costs	(2,558		)
Less current maturities of long-term debt	(1,972		)
Total long-term debt, net of current portion	$	105,470

Covenants and Security Interest

The agreements governing the Credit Facility contain a number of covenants that, among other things, require us to maintain a certain financial ratio (net leverage ratio and minimum fixed charge ratio). At December 31, 2019, we were in compliance with these debt covenants. Amounts borrowed under the Credit Facility are secured by substantially all of our assets.