Debt and Other Financing Arrangements

12 Months Ended

Dec. 31, 2015

10. Debt and Other Financing Arrangements

On March 20, 2014, the Company entered into an equipment financing arrangement with Banc of America Leasing & Capital, LLC (the “Lender”), which it amended on August 8, 2014 and September 15, 2015, including a Master Loan and Security Agreement and related documentation (collectively the “Equipment Loan Arrangement”) which provided the Company with the ability to finance, at its option, up to $8.8 million of new and used equipment purchases. Each such purchase financed under the Equipment Loan Arrangement is documented by the execution of an equipment note. Each note has a maturity date of 60 months from the applicable loan date, and bears interest at the then current 30-day LIBOR rate + 2.00%. Principal and interest are payable over the 60-month repayment period and principal is repayable without premium or penalty. Borrowings under the Equipment Loan Arrangement are secured by a first priority security interest in the equipment acquired with the proceeds of the equipment notes. Under the Equipment Loan Arrangement, the Company is subject to a maximum quarterly funded debt to EBITDA ratio and a minimum fixed charge coverage ratio. The Company was in compliance with all loan covenants as of December 31, 2015.

Under the Equipment Loan Arrangement, the Company executed notes on March 24, 2014, May 22, 2014, June 13, 2014, August 8, 2014 and September 15, 2015 in the amounts of $1,052,943, $1,935,241, $3,011,816, $999,626 and 1,098,539, respectively, for total borrowings of $8.1 million, of which $1.5 million and $700 thousand was repaid in 2015 and 2014, respectively. The interest rate for these notes for the year ended December 31, 2015 was 2.19%, and represented $128,700 of interest expense. As of December 31, 2015, the interest rate was 2.34%.

The annual principal repayment requirements for debt obligations as of December 31, 2015 are as follows:

2016	$	1,619,633
2017	$	1,619,633
2018	$	1,619,633
2019	$	868,090
2020	$	164,781
Total long-term debt	$	5,891,770
Less current portion of long-term debt	$	(1,619,633)
Total long-term debt, net of current portion	$	4,272,137