Debt |
6 Months Ended |
|---|---|
Jun. 30, 2023 | |
| Debt Disclosure [Abstract] | |
| Debt | DebtOn 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 subsequently further amended (the “existing revolving credit facility”). Borrowings under the existing 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 existing revolving credit facility also contains various affirmative and restrictive covenants. In particular, under the existing revolving credit facility, the Company is required, among other things, to mandatorily remit to PNC all amounts that constitute PREPA Claim Proceeds, as such term is defined in the existing revolving credit facility, including the $10.8 million received from PREPA on June 14, 2023, all of which was used to reduce outstanding borrowings under the existing revolving credit facility, as required under the terms thereof. Further, the existing revolving credit facility provides for a reduction in the maximum revolving advance amount in an amount equal to 50% of the PREPA Claims Proceeds remitted to PNC, subject to a floor equal to the sum of eligible billed and unbilled accounts receivables.
As of June 30, 2023, the applicable financial covenants under the existing revolving credit facility were as follows:
•the fixed charge coverage ratio was 1.1 to 1.0; and
•the minimum excess availability covenant was $10.0 million.
The Company was in compliance with the applicable financial covenants under its revolving credit facility in effect as of June 30, 2023 and December 31, 2022.
At June 30, 2023, there were outstanding borrowings under the existing revolving credit facility of $59.4 million, the borrowing base was $89.4 million and there was $13.6 million of available borrowing capacity under the facility, after giving effect to $6.4 million of outstanding letters of credit and the requirement to maintain a $10.0 million reserve out of the available borrowing capacity. At December 31, 2022, there were outstanding borrowings under the existing revolving credit facility of $83.5 million, the borrowing base was $119.8 million and there was $19.7 million of borrowing capacity under the facility, after giving effect to $6.5 million of outstanding letters of credit and the requirement to maintain a $10.0 million reserve out of the available borrowing capacity.
If an event of default occurs under the existing revolving credit facility and remains uncured, it could have a material adverse effect on the Company’s business, financial condition, liquidity and results of operations. 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. The existing revolving credit facility is currently scheduled to mature on October 19, 2023. See "Subsequent Events--Pending Repayment and Refinancing of Existing Revolving Credit Facility" for additional information.
Aviation Note
On November 6, 2020, 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 bore interest at a rate based on the Wall Street Journal Prime Rate plus a margin of 1%. The Aviation Note was paid off on September 30, 2022.
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