XML 62 R25.htm IDEA: XBRL DOCUMENT
v3.20.1

Subsequent Events | 3 Months Ended
--- | ---
Mar. 31, 2020
Subsequent Events [Abstract] |
Subsequent Events | 16. Subsequent Events Credit Facility On May 8, 2020, the Company entered into a Second Amended and Restated Revolving Credit, Term Loan and Security Agreement (the “New Loan Agreement”) with PNC, replacing our previous Revised Loan Agreement with PNC (see Note 9 – “Long Term Debt” for information on the Revised Loan Agreement with PNC). The New Loan Agreement provides us with the following credit facility:
| ● | up to $18,000,000 revolving credit facility, subject to the amount of borrowings based on a percentage of eligible receivables and subject to certain reserves; and
| ● | a term loan of $1,741,818, which requires monthly installments of $35,547.
The New Loan Agreement terminates as of May 15, 2024, unless sooner terminated. Similar to our Revised Loan Agreement, the New Loan Agreement requires the Company to meet certain customary financial covenants, including, among other things, a minimum Tangible Adjusted Net Worth requirement of $27,000,000 at all times; maximum capital spending of $6,000,000 annually; and a minimum FCCR requirement of 1.15:1. Under the New Loan agreement, payment of annual rate of interest due on the credit facility is as follows:
● | revolving credit at prime plus 2.50% or LIBOR plus 3.50% and the term loan at prime plus 3.00% or LIBOR plus 4.00%. The Company can only elect to use the LIBOR interest payment option after it becomes compliant with meeting the minimum FCCR of 1.15:1; and
● | Upon the achievement of a FCCR of greater than 1.25:1, the Company will have the option of paying an annual rate of interest due on the revolving credit at prime plus 2.00% or LIBOR plus 3.00% and the term loan at prime plus 2.50% or LIBOR plus 3.50%. The Company met this FCCR in the first quarter of 2020.
Under the LIBOR option of interest payment noted above, a LIBOR floor of 0.75% shall apply in the event that LIBOR falls below 0.75% at any point in time. Pursuant to the New Loan Agreement, the Company may terminate the New Loan Agreement upon 90 days’ prior written notice upon payment in full of our obligations under the New Loan Agreement. The Company has agreed to pay PNC 1.0% of the total financing in the event we pay off our obligations on or before May 7, 2021 and 1/2% of the total financing if we pays off our obligations after May 7, 2021 but prior to or on May 7, 2022. No early termination fee shall apply if we pay off our obligations under the New Loan Agreement after May 7, 2022. In connection with New Loan Agreement, the Company paid its lender a fee of $50,000. CARES Act Paycheck Protection Program On April 14, 2020, the Company entered into a promissory note with PNC, our credit facility lender, in the amount of $5,666,300 under the Paycheck Protection Program (the “PPP Loan”). The Paycheck Protection Program (“PPP”) was established under the recently enacted CARES Act and is administered by the U.S. Small Business Administration (“SBA”). The PPP Loan is unsecured, with a term of two years and has interest rate of 1.00% per annum. Payment of accrued interest and principal shall be deferred for the first six months of the loan. The note evidencing the PPP Loan contains events of default relating to, among other things, payment defaults, breach of representations and warranties, and provisions of the promissory note. Under the terms of the CARES Act, the Company can apply for and be granted forgiveness for all or a portion of the PPP Loan. Such forgiveness will be determined, subject to limitations, based on the use of loan proceeds by the Company for eligible payroll costs, mortgage interest, rent and utility costs and the maintenance of employee and compensation levels for an eight-week period, beginning April 14, 2020, the date in which proceeds from the PPP Loan was disbursed to the Company by PNC. At least 75% of such forgiven amount must be used for eligible payroll costs. The Company expects to apply for forgiveness on repayment of a portion of the loan as permitted under the program, which is subject to the approval of its lender. Deferral of Employment Tax Deposits The CARES Act, among other things, provides employers the option to defer the payment of an employer’s share of social security taxes beginning on March 27, 2020. In the event that a company receives a loan under the PPP, which the Company did on April 14, 2020, deferment of the employer’s share of social security taxes ceases immediately on the date that the company receives forgiveness on the loan under the PPP from its lender. However, 50% of the amount of social security taxes deferred prior to the loan forgiveness will become due on December 31, 2021 with the remaining 50% due on December 31, 2022. The Company has elected to defer such taxes starting in mid-April 2020. The Company estimates the remaining payment of approximately $815,000 of social security taxes otherwise due in 2020 will be deferred with 50% due by December 31, 2021 and the remaining 50% due by December 31, 2022. This estimated deferral amount does not take into account the timing of forgiveness on the loan under the PPP which forgiveness is subject to the approval by the Company’s lender.

X
- References No definition available. + Details
Name: | us-gaap_SubsequentEventsAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 855 -URI http://asc.fasb.org/topic&trid=2122774 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 855 -SubTopic 10 -Section 50 -Paragraph 2 -Subparagraph (a) -URI http://asc.fasb.org/extlink&oid=6842918&loc=SL6314017-165662 + Details
Name: | us-gaap_SubsequentEventsTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration