Quarterly report pursuant to Section 13 or 15(d)

Debt

v3.21.2
Debt
 6 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Debt Debt
Long-term debt included the following (in thousands):
June 30, December 31,
2021 2020
Revolving credit facility $ 60,198  $ 78,000 
Aviation note 4,084  4,551 
Unamortized debt issuance costs (41) (48)
Total debt 64,241  82,503 
Less: current portion 1,430  1,165 
Total long-term debt $ 62,811  $ 81,338 

Mammoth Credit Facility

On October 19, 2018, Mammoth Inc. and certain of its direct and indirect subsidiaries, as borrowers, entered into an amended and restated revolving credit and security agreement with the lenders party thereto and PNC Bank, National Association, as a lender and as administrative agent for the lenders, as amended and restated (the “revolving credit facility”). The revolving credit facility matures on October 19, 2023. Borrowings under the revolving credit facility are secured by the assets of Mammoth Inc., inclusive of the subsidiary companies, and are subject to a borrowing base calculation prepared monthly.

The revolving credit facility also contains various customary affirmative and restrictive covenants. Among the covenants are two financial covenants, including a maximum leverage ratio (2.5 to 1.0) and a minimum fixed charges coverage ratio of at least 1.1 to 1.0. As of June 30, 2021 and December 31, 2020, the Company was in compliance with its financial covenants under the revolving credit facility.

At June 30, 2021, there were outstanding borrowings under the revolving credit facility of $60.2 million and $51.1 million of available borrowing capacity under the facility, after giving effect to $13.0 million of outstanding letters of credit. At December 31, 2020, there were outstanding borrowings under the revolving credit facility of $78.0 million and $38.7 million of borrowing capacity under the facility, after giving effect to $13.0 million of outstanding letters of credit.

As of July 27, 2021, the Company had $61.4 million in borrowings outstanding under its revolving credit facility, leaving an aggregate of $49.8 million of available borrowing capacity under this facility, after giving effect to $13.0 million of outstanding letters of credit. If an event of default occurs under the revolving credit facility and remains uncured, it could have a material adverse effect on the Company's business, financial condition, results of operations and cash flows. The lenders (i) would not be required to lend any additional amounts to the Company, (ii) could elect to increase the interest rate by 200 basis points, (iii) could elect to declare all outstanding borrowings, together with accrued and unpaid interest and fees, to be due and payable, (iv) may have the ability to require the Company to apply all of its available cash to repay outstanding borrowings, and (v) may foreclose on substantially all of the Company's assets.

Aviation Note

On November 6, 2020, Leopard Aviation LLC (“Leopard”) and Cobra Aviation entered into a 39 month promissory note agreement with Bank7 (the “Aviation Note”) in an aggregate principal amount of $4.6 million and received net proceeds of $4.5 million. The Aviation Note bears interest at a rate based on the Wall Street Journal Prime Rate plus a margin of 1%. Principal and interest payments of $0.1 million are due monthly beginning on March 1, 2021, with a final payment of $0.2 million due on February 1, 2024. The Aviation Note is collateralized by Leopard and Cobra Aviation's assets, including a $1.8 million certificate of deposit. The Aviation Note contains various customary affirmative and restrictive covenants. Included in the affirmative covenants is a minimum cash requirement, which requires Leopard and Cobra Aviation to maintain a minimum of $0.75 million of cash in accounts held by Bank7 until August 1, 2021.

As of June 30, 2021, the Company did not meet the minimum debt coverage ratio of 1.25 to 1.0 set forth in the Aviation Note. On July 26, 2021, Bank7 granted the Company a waiver of this event of default. The waiver extended the minimum cash requirement until November 15, 2021.