Quarterly report pursuant to Section 13 or 15(d)

Note 9 - Financing

v3.19.1
Note 9 - Financing
3 Months Ended
Mar. 31, 2019
Notes to Financial Statements  
Debt Disclosure [Text Block]
9.
Financing
 
Long-term debt consisted of the following:
 
   
As of
(in millions)
 
March 31, 2019
 
December 31, 2018
Term Loan B Facility
  $
312.0
 
  $
312.8
 
Deferred financing fees and discount on debt
   
(4.9
)
   
(5.1
)
Obligations under finance lease
   
2.2
 
   
2.6
 
Total debt
   
309.3
 
   
310.3
 
Less: Current portion of debt
   
(4.3
)
   
(4.6
)
Noncurrent portion of debt
  $
305.0
 
  $
305.7
 
 
Term Loan B Facility
 
At 
March 31, 2019
, we had
$312.0
million outstanding under our long-term credit facility that matures on
May 
29,
2025
(the “Term Loan B Credit Agreement” and together with the facility thereunder, the “Term Loan B Facility”). Amounts outstanding under this facility bear interest at a rate per annum equal to, at our option, either (
1
)
1.50%
plus an Alternate Base Rate (as defined in the Term Loan B Credit Agreement) or (
2
)
2.50%
plus the Adjusted LIBO Rate (as defined in the Term Loan B Credit Agreement).
 
In order to minimize the variability in cash flows caused by fluctuations in market interest rates, we entered into an interest rate swap agreement on
May 25, 2018,
which expires on
May 
31,
2023
.
This swap agreement fixes the LIBOR rate on
$150.0
million of our floating rate LIBOR debt at
2.75%
. At 
March 31, 2019
, amounts outstanding under the Term Loan B Facility combined with our interest rate swap derivative accrued interest at a weighted average rate of
5.12%
.
 
The Term Loan B Credit Agreement requires mandatory prepayments based on various events and circumstances as are customary in such agreements. We are subject to a
50%
excess cash flow sweep, subject to step-downs to
25%
and
0%
depending on the total net leverage ratio from time to time. We
may,
however, voluntarily prepay outstanding loans under the Term Loan B Facility at any time.
 
In connection with the Term Loan B Facility, we are required to make quarterly payments of
$0.8
million with the balance expected to be due at maturity.
 
ABL Facility
 
We have an asset-based revolving loan facility (the “ABL Credit Agreement” and together with the facility thereunder, the “ABL Facility”) that matures on
July 
19,
2021
and provides for borrowings of up to the lesser of
$200.0
million or the borrowing base, in each case less outstanding loans and letters of credit.
 
As of
March 31, 2019
, we had
no
borrowings outstanding under the ABL Facility and available borrowings under the facility were
$195.4
million after giving effect to
$4.6
million of letters of credit outstanding, which are used to provide collateral for our insurance programs. We
may
request an increase in the maximum commitments, at our option and under certain circumstances, of up to
$200.0
million (but the lenders are
not
obligated to grant such an increase).
 
The Credit Agreements
 
The ABL Credit Agreement and the Term Loan B Credit Agreement (together, the “Credit Agreements”) contain various covenants consistent with debt agreements of this kind, such as restrictions on the amounts of dividends we can pay. As of 
March 31, 2019
, we were in compliance with all of the covenants relating to the Credit Agreements.