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Debt (Tables)
 9 Months Ended
Sep. 30, 2020
Debt Disclosure [Abstract]  
Net Carrying Amount of Debt

 

 

 

 

 

 

 

 

 

 

September 30, 

 

December 31, 

 

($ in thousands)

    

2020

    

2019

 

Xcel Term Loan

 

$

17,500

 

$

19,000

 

Unamortized deferred finance costs related to term loan

 

 

(127)

 

 

(179)

 

Total

 

 

17,373

 

 

18,821

 

Current portion of long-term debt

 

 

2,850

 

 

2,250

 

Long-term debt

 

$

14,523

 

$

16,571

 

 

Maturities of Long-term Debt

 

The remaining principal balance of the Xcel Term Loan, as amended, outstanding at September 30, 2020 is payable in fixed installments as set forth in the following table, plus the variable payments as described below:

 

 

 

 

 

($ in thousands)

Installment Payment Dates

    

Amount

December 31, 2020

 

$

750

 

 

 

 

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

 

$

700

 

 

 

 

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 $4.45 million as of March 31, 2022, any such shortfall must be repaid at that date.

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

 

 

 

 

 

 

 

Amount of

($ in thousands)

 

Principal

Year Ending December 31, 

    

Payment

2020

 

$

750

2021

 

 

2,800

2022

 

 

8,950

2023

 

 

5,000

Total

 

$

17,500

 

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 as defined in the loan agreements of at least $90.0 million at the end of each fiscal quarter;

·

liquid assets of at least $3.0 million through December 31, 2020, at least $2.5 million for the fiscal quarters ending March 31, 2021 through September 30, 2021,  at least $3.0 million for the fiscal quarter ending December 31, 2021, and at least $5.0 million thereafter;

·

EBITDA shall not be less than $5.0 million for the twelve month fiscal period ending September 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

December 31, 2020, March 31, 2021, June 30, 2021, September 30, 2021, and December 31, 2021

 

1.25 to 1.00

March 31, 2022, and thereafter

 

1.10 to 1.00

 

·

capital expenditures (excluding any capitalized compensation costs) shall not exceed $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 below:

 

 

 

 

Fiscal Period

    

Maximum Leverage Ratio

September 30, 2020

 

4.00 to 1.00

December 31, 2020

 

3.50 to 1.00

March 31, 2021

 

3.15 to 1.00

June 30, 2021

 

3.00 to 1.00

September 30, 2021

 

2.75 to 1.00

December 31, 2021

 

2.50 to 1.00

March 31, 2022 and each Fiscal Quarter end thereafter

 

1.50 to 1.00