|9 Months Ended|
Jun. 30, 2020
|Debt Disclosure [Abstract]|
The Company maintains various credit facilities from time to time to finance acquisitions, the purchase of real estate, construction equipment, plants and other fixed assets, and for general working capital purposes. During the three and nine months ended June 30, 2020, these included, among other things, a credit agreement with BBVA USA (“BBVA”), as agent, issuing bank and a lender, and certain other lenders (as amended, the “BBVA Credit Agreement”), which provided for a term loan with an original principal amount of $82.0 million (the “Term Loan”) and a $30.0 million revolving credit facility (the “Revolving Credit Facility”). Debt at June 30, 2020 and September 30, 2019 consisted of the following (in thousands):
On October 1, 2019, the Company and each of its wholly owned subsidiaries entered into an amendment to the BBVA Credit Agreement that, among other things: (i) added Bank of America, N.A. (“Bank of America”) as a party in connection with the assignment by BBVA to Bank of America of certain of its lending obligations under the BBVA Credit Agreement; (ii) increased the aggregate amount of the Term Loan commitment by the lenders by $10.0 million to $54.7 million; (iii) provided for a Term Loan advance to the Company in the aggregate amount of $10.0 million, with the proceeds to be used solely for the purpose of buying out certain operating lease obligations; and (iv) extended the maturity date for the outstanding Term Loan advances from July 1, 2022 to October 1, 2024. In order to hedge against the risk of changes in interest rates on this advance, on October 1, 2019, the Company entered into an interest rate swap agreement with a notional amount of $5.9 million, under which the Company pays a fixed percentage rate of 1.58% and receives a credit based on the applicable London Interbank Offered Rate (“LIBOR”).
On February 27, 2020 the Company entered into an additional interest rate swap agreement with a notional amount of $26.3 million, under which the Company pays a fixed percentage rate of 1.24% and receives a credit based on the applicable LIBOR rate.
In March 2020, the Company drew $15.0 million on the Revolving Credit Facility to fund the March 23, 2020 Florida acquisition and to provide additional liquidity (see Note 4 - Business Acquisitions). This borrowing was paid off with the April 2020 Term Loan advance as noted below.
In April 2020, the Company and each of its wholly owned subsidiaries entered into an amendment to the BBVA Credit Agreement that, among other things, (i) provided for a Term Loan advance to the Company in the amount of $18.0 million, (ii) established a minimum interest rate for the foregoing Term Loan advance and future Term Loan advances, (iii) adjusted the Term Loan recourse amounts applicable to the Company and its subsidiaries, (iv) increased the amount of the quarterly principal installment payments under outstanding Term Loan advances to $2.5 million, and (v) set forth procedures by which the parties will select a replacement benchmark interest rate in the event that LIBOR, the current benchmark interest rate under the Credit Agreement, is no longer available or appropriate as a reference rate upon which to determine the interest rate after December 31, 2021, the date on which contributing banks will no longer be required to submit rate information from which LIBOR is calculated.Subsequent to June 30, 2020, the Company and each of its wholly owned subsidiaries entered into an Amended and Restated Credit Agreement with BBVA, as agent, sole lead arranger and sole bookrunner, and certain other lenders (the “Amended Credit Agreement”) that amended and restated the BBVA Credit Agreement in its entirety and, among other things, increased the aggregate amount of the commitments of the lenders under the Revolving Credit Facility from $30.0 million to $50.0 million and increased the Term Loan commitments of the lenders by $30.0 million. For more information about the Amended Credit Agreement, see the discussion under the heading Recent Financing Developments in Note 20 - Subsequent Events.
The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef