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Debt and Contingent Obligations (Tables)
 9 Months Ended
Sep. 30, 2019
Debt Disclosure [Abstract]  
Net Carrying Amount of Debt
The Company’s net carrying amount of debt was comprised of the following:
($ in thousands)
 
September 30,
2019
 
December 31,
2018
Xcel Term Loan
 
$
20,000

 
$
15,500

Unamortized deferred finance costs related to term loan
 
(211
)
 
(200
)
IM Seller Note
 
—

 
742

Ripka Seller Note
 
—

 
583

Contingent obligation - HH Seller
 
900

 
—

Contingent obligation - JR Seller
 
—

 
100

Contingent obligation - CW Seller
 
—

 
2,850

Total
 
20,689

 
19,575

Current portion of long-term debt (i), (ii)
 
4,750

 
8,275

Long-term debt
 
$
15,939

 
$
11,300

(i)
The current portion of long-term debt as of September 30, 2019 consisted of $4.75 million related to the Xcel Term Loan.
(ii)
The current portion of long-term debt presented on the Condensed Consolidated Balance Sheet at December 31, 2018 includes (a) $4.0 million related to the Prior Term Loan, (b) $0.74 million related to the IM Seller Note, (c) $2.95 million related to contingent obligations, and (d) $0.58 million related to the Ripka Seller Note.
Maturities of Long-term Debt
Principal on Term Loan A is payable in quarterly installments on each of March 31, June 30, September 30, and December 31 as follows:
($ in thousands)
 
Period
Amount
June 30, 2019 – September 30, 2020
$
1,000

 
 
December 31, 2020
$
1,250


Principal on Term Loan B is payable in quarterly installments on each of March 31, June 30, September 30, and December 31 as follows:
($ in thousands)
 
Period
Amount
March 31, 2020 – September 30, 2020
$
250

 
 
March 31, 2021 – December 30, 2022
$
1,125

 
 
March 31, 2023 – December 31, 2023
$
1,250
Schedule of Fixed Charge Coverage Ratios and Leverage Ratios
The Xcel Term Loan contains customary covenants, including reporting requirements, trademark preservation, and the following financial covenants of Xcel (on a consolidated basis with Xcel and the Guarantors under the Second Amended and Restated Loan and Security Agreement):
•
net worth of at least $90.0 million at the end of each fiscal quarter;
•
liquid assets of at least $4.0 million through April 30, 2020, and at least $5.0 million thereafter;
•
the fixed charge coverage ratio for the twelve-fiscal month period ending at the end of each fiscal quarter shall not be less than the ratio set forth below for such fiscal period:
Fiscal Quarter End
Fixed Charge Coverage Ratio
December 31, 2019, March 31, 2020, June 30, 2020, September 30, 2020
1.05 to 1.00
December 31, 2020, March 31, 2021, June 30, 2021, September 30, 2021, December 31, 2021 and thereafter
1.10 to 1.00
•
capital expenditures (excluding any capitalized compensation costs) shall not exceed $1.7 million for fiscal year December 31, 2018;
•
capital expenditures (excluding any capitalized compensation costs) shall not exceed $0.9 million for fiscal year December 31, 2019;
•
capital expenditures (excluding any capitalized compensation costs) shall not exceed $0.7 million for any fiscal year beginning after December 31, 2019; and
•
the leverage ratio for the twelve-fiscal month period ending at the end of each fiscal period set forth below shall not exceed the ratio below:
Fiscal Period
Maximum Leverage Ratio
December 31, 2018
2.90 to 1.00
December 31, 2019, March 31, 2020, June 30, 2020, and September 30, 2020
2.40 to 1.00
December 31, 2020, March 31, 2021, June 30, 2021 and September 30, 2021
1.70 to 1.00
December 31, 2021 and each Fiscal Quarter end thereafter
1.50 to 1.00