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Debt | 9 Months Ended
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Sep. 30, 2016
Debt Disclosure [Abstract] |
Debt | Note 5 – Debt Credit Agreement On July 31, 2015, the Company entered into a Credit Agreement with the lenders named therein and Capital One, National Association (as administrative agent). The Credit Agreement was amended on March 25, 2016 to, among other matters, increase the size of the senior secured revolving credit facility under the Credit Agreement (the “Revolving Credit Facility”) from $40.0 million to $50.0 million and to provide for the borrowing of an additional $40.0 million in aggregate principal amount of incremental senior secured term loans under the Credit Agreement (the “Incremental Term Loans”). As of September 30, 2016, the facilities under the Credit Agreement consisted of $160.0 million in senior secured term loans (the “Term Loans,” which include the Incremental Term Loans) and a $50.0 million Revolving Credit Facility (together with the Term Loans, the “Facilities”). The Company used the proceeds from the Incremental Term Loan borrowings to repay all of the Company’s then-outstanding borrowings under the Revolving Credit Facility. As of September 30, 2016, the Company had $153.0 million in principal amount of outstanding Term Loan borrowings and $25.0 million in principal amount of outstanding borrowings under the Revolving Credit Facility. The Facilities mature on July 31, 2020. Borrowings under the Credit Agreement bear interest, at the Company’s option, at either (1) the highest of the federal funds rate plus 0.50%, the Eurodollar rate for a one-month interest period plus 1.00%, or the administrative agent’s prime rate as announced from time to time, or (2) the Eurodollar rate for the applicable interest period, plus, in each case, an applicable margin based on the Company’s leverage ratio. As of September 30, 2016, the weighted average effective interest rate on the Company’s outstanding borrowings under the Credit Agreement was approximately 3.02%. Outstanding borrowings under the Term Loans must be repaid in two quarterly payments of $1.5 million each (which commenced on December 31, 2015), followed by two quarterly payments of $2.0 million each (which commenced on June 30, 2016), followed by eight quarterly payments of $3.0 million each (commencing December 31, 2016), followed by four quarterly payments of $4.0 million each (commencing December 31, 2018), followed by three quarterly payments of $6.0 million each (commencing December 31, 2019), followed by a final installment of $95.0 million at maturity on July 31, 2020. The commitment fee for the Revolving Credit Facility is payable quarterly at a rate of between 0.25% and 0.30%, depending on the Company’s leverage ratio. The Credit Agreement is guaranteed by all of the Company’s present and future direct and indirect wholly owned subsidiaries (other than certain insignificant or unrestricted subsidiaries), and is secured by substantially all of the Company’s and the subsidiary guarantors’ present and future personal and real property (subject to receipt of certain approvals). Under the Credit Agreement, the Company and its subsidiaries are subject to certain limitations, including limitations on their ability to: incur additional debt, grant liens, sell assets, make certain investments, pay dividends and make certain other restricted payments. In addition, the Company will be required to pay down the Facilities under certain circumstances if the Company or any of its subsidiaries sells assets or property, issues debt or receives certain extraordinary receipts. The Credit Agreement contains financial covenants regarding a maximum leverage ratio and a minimum fixed charge coverage ratio. The Credit Agreement also prohibits the occurrence of a change of control, which includes the acquisition of beneficial ownership of 30% or more of the Company’s equity securities (other than by certain permitted holders, which include, among others, Blake L. Sartini, Lyle A. Berman and certain affiliated entities) and a change in a majority of the members of the Company’s Board of Directors that is not approved by the Board. If the Company defaults under the Credit Agreement due to a covenant breach or otherwise, the lenders may be entitled to, among other things, require the immediate repayment of all outstanding amounts and sell the Company’s assets to satisfy the obligations thereunder. The Company was in compliance with its financial covenants under the Credit Agreement as of September 30, 2016. Hedging Activities Borrowings under the Company’s Facilities bear interest at a variable rate. To hedge the associated interest rate risk, in September 2016, the Company entered into an interest rate swap agreement that has the economic effect of modifying the variable interest obligations associated with 75% of the Company’s projected outstanding borrowings under the Company’s Facilities so that the LIBOR portion of the interest payable thereunder will effectively be fixed at 0.98% per annum. This agreement covers the period from December 30, 2016 through December 31, 2020 and changes in the cash flows of the interest rate swap are expected to be highly effective in offsetting the forecasted changes in interest rate payments associated with interest rate fluctuations on the portion of the Company's variable rate debt for which it applies. The material terms of the interest rate swap agreement match the material terms of the Facilities that the interest rate swap agreement pertains to, including the notional amounts and maturity date. The Company has designated this interest rate swap agreement as a qualifying hedging instrument and will account for it as a fair value hedge pursuant to ASC 815, Derivatives and Hedging. The transaction is characterized as a fair value hedge for financial accounting purposes because it protects the Company against changes in the fair value of certain of the Company’s variable-rate borrowings due to benchmark interest rate movements. The Company does not use any interest rate swap agreements for trading purposes. Summary of Outstanding Debt Long-term debt, net is comprised of the following:
|  | September 30, 2016 |  |  | December 31, 2015 |
|  | (In thousands) |
Term Loans |  | $ | 153,000 |  |  | $ | 118,500 |
Revolving Credit Facility |  |  | 25,000 |  |  |  | 25,000 |
Capital lease obligations |  |  | 2,140 |  |  |  | – |
Notes payable |  |  | 3,923 |  |  |  | 5,135 |
Total long-term debt |  |  | 184,063 |  |  |  | 148,635 |
Less: Unamortized debt issuance costs |  |  | (2,499 | ) |  |  | (2,537 | )
|  |  | 181,564 |  |  |  | 146,098 |
Less: Current portion, net of unamortized debt issuance costs |  |  | (14,545 | ) |  |  | (8,552 | )
Long-term debt, net |  | $ | 167,019 |  |  | $ | 137,546 |

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 505 -SubTopic 10 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6928386&loc=d3e21475-112644 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.19,20,22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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