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Debt and Other Long-term Liabilities (Tables)
 12 Months Ended
Dec. 31, 2019
Debt Disclosure [Abstract]  
Schedule of Debt at Carrying Amount

The Company’s net carrying amount of debt is comprised of the following:

 

 

 

 

 

 

 

 

 

 

December 31, 

($ in thousands)

 

2019

    

2018

Xcel Term Loan

 

$

19,000

 

$

15,500

Unamortized deferred finance costs related to term loan

 

 

(179)

 

 

(200)

IM Seller Note

 

 

 —

 

 

742

Ripka Seller Note

 

 

 —

 

 

583

Contingent obligation – JR Seller

 

 

 —

 

 

100

Contingent obligation – CW Seller

 

 

 —

 

 

2,850

Total

 

 

18,821

 

 

19,575

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

 

 

2,250

 

 

8,275

Long-term debt

 

$

16,571

 

$

11,300

(i)

The current portion of long-term debt presented on the consolidated balance sheet at December 31, 2019 consists of $2.25 million related to the Xcel Term Loan.

(ii)

The current portion of long-term debt presented on the consolidated balance sheet at December 31, 2018 includes (a) $4.0 million related to the Xcel 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 the Xcel Term Loan, as amended, is payable in fixed installments as follows:

 

 

 

 

($ in thousands)

Installment Payment Dates

    

Amount

June 30, 2020, September 30, 2020, and December 31, 2020

 

$

750

 

 

 

 

March 31, 2021, June 30, 2021, September 30, 2021, and December 31, 2021

 

$

1,125

 

 

 

 

April 30, 2021

 

$

750

 

 

 

 

March 31, 2022, June 30, 2022, September 30, 2022, and December 31, 2022

 

$

1,125

 

 

 

 

March 31, 2023, June 30, 2023, September 30, 2023, and December 31, 2023

 

$

1,250

 

In addition to the fixed installments outlined above, commencing with the fiscal quarter ended March 31, 2021, the Company is required to repay a portion of the Xcel Term Loan in an amount equal to 50% of the excess cash flow for the fiscal quarter, provided that no early termination fee shall be payable with respect to any such payment. Excess cash flow means, for any period, cash flow from operations (before certain permitted distributions) less (i) capital expenditures not made through the incurrence of indebtedness, (ii) all cash principal paid or payable during such period, and (iii) all dividends declared and paid (or which could have been declared and paid) during such period to equity holders of any credit party treated as a disregarded entity for tax purposes. To the extent that the cumulative amount of such variable repayments made is less than $2.00 million as of March 31, 2022, any such shortfall must be repaid at that date.

 

Thus, the aggregate remaining annual principal payments under the Xcel Term Loan are as follows:

 

 

 

 

 

 

 

Amount of

($ in thousands)

 

Principal

Year Ending December 31, 

    

Payment

2020

 

$

2,250

2021

 

 

5,250

2022

 

 

6,500

2023

 

 

5,000

Total

 

$

19,000

 

Schedule of Fixed Charge Coverage Ratios and Leverage Ratios

The Amended Loan Agreement contains customary covenants, including reporting requirements, trademark preservation, and the following financial covenants of the Company (on a consolidated basis with 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 $3.25 million through the earlier of December 31, 2020 or such time as any PPP loan proceeds are received by the Company, at least $4.0 million through December 31, 2020 provided that PPP loan proceeds have been received by the Company, and at least $5.0 million thereafter;

·

EBITDA shall not be less than $6.8 million for the fiscal year ended December 31, 2019, $5.0 million for the twelve fiscal month period ending March 31, 2020, and $4.8 million for the twelve fiscal month period ending June 30, 2020; 

·

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:

 

 

 

Fiscal Quarter End

    

Fixed Charge Coverage Ratio

September 30, 2020

 

1.00 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 the fiscal year ended December 31, 2018; $0.7 million for the fiscal year ended December 31, 2019; $1.6 million for the fiscal year ending December 31, 2020, and $0.7 million for any fiscal year beginning after December 31, 2020; 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 set forth below:

 

 

 

Fiscal Period

    

Maximum Leverage Ratio

December 31, 2018

 

2.90 to 1.00

June 30, 2020

 

4.25 to 1.00

September 30, 2020

 

3.50 to 1.00

December 31, 2020

 

2.75 to 1.00

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