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Debt | 9 Months Ended
--- | ---
Sep. 30, 2020
Debt Disclosure [Abstract] |
Debt | Note 8. Debt As of September 30, 2020, the Company had $57.8 million outstanding under its current term loan facility and $0.0 million in borrowings under its revolving credit facility. The Company has available $10.0 million under its revolving credit facility (unaudited). The following table reflects the current and noncurrent portions of the external debt facilities at December 31, 2019 and September 30, 2020 (in thousands):
|  | December 31, |  |  | September 30, |
|  | 2019 |  |  | 2020 |
|  |  |  |  |  | (unaudited) |
Term loan facility |  | $ | 65,250 |  |  | $ | 57,750 |
Less debt issuance costs |  |  | (1,638 | ) |  |  | (1,228 | )
Total debt |  |  | 63,612 |  |  |  | 56,522 |
Less current portion of term facility |  |  | (10,000 | ) |  |  | (10,000 | )
Current portion of debt issuance costs |  |  | 546 |  |  |  | 546 |
Total long-term external debt, net |  | $ | 54,158 |  |  | $ | 47,068 |
Secured credit agreement Both the term loan facility and the revolving credit facility mature on December 22, 2022. Following the completion of the Third Amendment (“Third Amendment”) to the December 21, 2017 credit agreement (as amended and restated, the “Credit Agreement”) entered into on June 28, 2019, the total term loan commitment was reduced to $70.0 million and the revolving agreement had an available commitment of $10.0 million. Interest accrues on the outstanding principal amount of the term loan on a quarterly basis and is equal to the three-month USD LIBOR rate plus a base rate of 4.75%, 4.25%, or 4.00%. The rate on the term loan at December 31, 2019 was 6.85%, was reduced to 6.0% on March 31, 2020, and remains at 6.0% at September 30, 2020 as a result of resetting the LIBOR rate applicable to the loan. In addition to paying interest on the outstanding principal under the term loan facility, the Company is required to pay a commitment fee in respect of the unutilized commitments under the revolving credit facility, payable quarterly in arrears. The Company is also required to pay letter of credit fees on the maximum amount available to be drawn under all outstanding letters of credit in an amount equal to the applicable margin on LIBOR based borrowings under the revolving credit facility on a per annum basis, payable in arrears, as well as customer fronting fees for the issuance of letters of credit and agency fees. The Company is permitted to voluntarily reduce the unutilized portion of the commitment amount and repay outstanding loans under the Credit Agreement at any time without premium or penalty, other than customary breakage costs with respect to LIBOR based loans. Maturities on the external debt outstanding at September 30, 2020 is as follows (unaudited and in thousands):
Year ending December 31, |  |  |  |
2020 (October - December) |  | $ | 2,500 |
2021 |  |  | 10,000 |
2022 |  |  | 45,250 |
Total |  | $ | 57,750 |
Borrowings under the Credit Agreement are secured by a first-priority lien on substantially all of the Company’s assets, the equity interests in the Company’s subsidiaries, and any intercompany debt. The Credit Agreement contains certain customary affirmative and negative covenants that are usual and customary for companies with similar credit ratings. As of September 30, 2020, the Company was in compliance with all affirmative and negative covenants (unaudited). The Company’s current debt covenant requirements for the next four quarters reflect the following limits, based on the time period noted, for compliance with the covenant.:
|  | Quarter ending
Covenant | Criteria |  | December 31, 2020 |  | March 31, 2021 |  | June 30, 2021 |  | September 30, 2021
Monthly minimum adjusted quick ratio | Min ratio | Non quarter-end months 1.00:1.00 Quarter-end months 1.15:1.00
Quarterly consolidated fixed charge coverage ratio | Min ratio |  | 1.25:1.00 |  | 1.25:1.00 |  | 1.25:1.00 |  | 1.25:1.00
Quarterly consolidated fixed charge coverage ratio | Time period | Trailing twelve-month
Quarterly consolidated leverage ratio | Max ratio |  | 2.50:1.00 |  | 2.25:1.00 |  | 2.25:1.00 |  | 2.00:1.00
Quarterly consolidated leverage ratio | Time period | Trailing twelve-month
Expected Discontinuation of LIBOR In July 2017, the United Kingdom’s Financial Conduct Authority, which regulates LIBOR, announced it will no longer compel banks to submit rates for the calculation of LIBOR after 2021. The Alternative Reference Rates Committee has proposed the Secured Overnight Financing Rate (“SOFR”) as its recommended alternative to LIBOR, and the first publication of SOFR rates was released in April 2018. The Company is evaluating the potential impact of the transition from LIBOR as an interest rate benchmark to other potential alternative reference rates, including SOFR. The Company’s Credit Agreement is currently indexed to LIBOR and the maturity date of the Credit Agreement extends beyond 2021. The Credit Agreement contemplates the discontinuation of LIBOR and provides options for the Company in such an event. The Company will continue to actively assess the related opportunities and risks involved in this transition. Net interest expense, including bank charges and amortization of debt issuance costs on the external debt, was $2.1 million and $1.2 million for the three-month period ended September 30, 2019 and 2020, respectively, and $6.7 million and $4.1 million for the nine-month periods ended September 30, 2019 and 2020, respectively.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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