(3)Bank Debt

On March 18, 2016, we executed an amendment to our credit agreement with PNC, as administrative agent for our lenders, for the primary purpose of increasing liquidity and maintaining compliance through the maturity of the agreement in August 2019. The revolver was reduced from $250 million to $200 million and the $175 million term loan remained the same. Our debt at December 31, 2017 was $202 million (term-$71 million, revolver-$131 million). As of December 31, 2017, we had additional borrowing capacity of $69 million and total liquidity of $85 million.

Bank fees and other costs incurred in connection with the initial facility and the amendment were $9.1 million, which were deferred and are being amortized over five years. The credit facility is collateralized by substantially all of Sunrise’s assets, and we are the guarantor.

The amended credit facility increased the Maximum Leverage Ratio (Sunrise total funded debt/ trailing 12 months adjusted EBITDA) to those listed below:



Fiscal Periods Ending		Ratio
December 31, 2017 and March 31, 2018		4.25X
June 30, 2018 and September 30, 2018		4.00X
December 31, 2018		3.75X
March 31, 2019 and June 30, 2019		3.50X

The amended credit facility also requires a Debt Service Coverage Ratio minimum of 1.25X through the maturity of the credit facility. The amendment defines the Debt Service Coverage Ratio as trailing 12 months adjusted EBITDA/annual debt service.

At December 31, 2017, our Leverage Ratio was 2.40 and our Debt Service Coverage Ratio was 1.90. Therefore, we were in compliance with these two debt covenant ratios.

The interest rate on the facility ranges from LIBOR plus 2.25% to LIBOR plus 4%, depending on our leverage ratio. We entered into swap agreements to fix the LIBOR component of the interest rate to achieve an effective fixed rate of ~5% on the original term loan balance and on $100 million of the revolver. The revolver swap notional value steps down 10% each quarter which commenced on March 31, 2016. At December 31, 2017, these two interest rate swaps had an estimated net fair value of $.5 million included in other assets on our consolidated balance sheet. Notional values of the two interest rate swaps were $96 million and $30 million as of December 31, 2017.

At December 31, 2017, we were paying LIBOR at 1.57% plus 3% for a total interest rate of 4.57%.

New accounting standards adopted in 2016 required that our debt issuance costs be presented as a direct reduction from the related debt rather than as an asset. Our debt at December 31 is presented below (in thousands):



		2017		2016
Current debt	$	35,000	$	30,625
Less debt issuance cost		(1,829)		(1,829)
Net current portion	$	33,171	$	28,796

Long-term debt	$	166,992	$	207,992
Less debt issuance cost		(1,219)		(3,048)
Net long-term portion	$	165,773	$	204,944




Future Maturities (in thousands):
2018	$	35,000
2019		166,992
Total	$	201,992