Debt

12 Months Ended

Dec. 31, 2021

Debt Disclosure [Abstract]

Debt

Note 7 – Debt 

	December 31,
	2021			2020
Term loan due August 2026. Interest (2.15% at December 31, 2021) payable monthly.	$	4,500		$	–
Unamortized deferred financing costs		(30	)		–
Total note payable		4,470			–
Less current portion		(1,000	)		–
Total long-term portion	$	3,470		$	–

The scheduled maturities of the term loan, excluding deferred financing costs, at December 31, 2021 are as follows: 

2022	$	1,000
2023		1,000
2024		1,000
2025		1,000
2026		500
Total term loan	$	4,500

Credit Agreement

On September 30, 2020, Lifeway entered into the Third Modification to the Amended and Restated Loan and Security Agreement, as amended, (the “Third Modification”) with its existing lender. The Third Modification amends the Amended and Restated Loan and Security Agreement, as amended, by removing the monthly borrowing base reporting requirement effective September 30, 2020, including a covenant to maintain a quarterly minimum working capital financial covenant, as defined, of no less than $11.25 million each of the fiscal quarters commencing the fiscal quarter ending December 31, 2020 through the expiration date, and eliminating the tier interest pricing structure. The Amended and Restated Loan and Security Agreement continues to provide Lifeway with a revolving line of credit up to a maximum of $5 million (the “Revolving Loan”) and provides the Borrowers with an incremental facility not to exceed $5 million (the “Incremental Facility” and together with the Revolving Loan, the “Loans”). The Termination Date of the Revolving Loan was extended to June 30, 2025, unless earlier terminated.

On August 18, 2021, Lifeway entered into the Fourth Modification (the “Fourth Modification”) to the Amended and Restated Loan and Security Agreement (as amended and modified from time to time, the “Credit Agreement” and, as amended and modified by the Fourth Modification, the “Modified Credit Agreement”) with its existing lender and certain of its subsidiaries. The Fourth Modification amends the Credit Agreement to provide for, among other things, a $5 million term loan by the existing lender to the borrowers to be repaid in quarterly installments of principal and interest payable monthly over a term of five years (the “Term Loan”). The termination date of the Term Loan is August 18, 2026, unless earlier terminated.

As amended, all outstanding amounts under the revolving line of credit and term loan bear interest, at Lifeway’s election, at either the lender Base Rate (the Prime Rate minus 1.00%) or the LIBOR plus 1.95%, payable monthly in arrears. Lifeway is also required to pay a quarterly unused revolving line of credit fee of 0.20% and, in conjunction with the issuance of any letters of credit, a letter of credit fee of 0.20%. There were no letters of credit issued or outstanding as of December 31, 2021.

Except as described above, as amended, the Modified Credit Agreement remains substantively unchanged and in full force and effect, including customary representations, warranties, and covenants on the part of Lifeway, including financial covenants requiring us to maintain a fixed charge coverage ratio of no less than 1.25 to 1.00 each of the fiscal quarters ending through the expiration date. The Modified Credit Agreement continues to provide for events of default, including failure to repay principal and interest when due and failure to perform or violation of the provisions or covenants of the agreement, as a result of which amounts due under the Modified Credit Agreement may be accelerated. The loans and all other amounts due and owed under the Credit Agreement and related documents are secured by substantially all of the Company’s assets.

Lifeway was in compliance with the fixed charge coverage ratio and minimum working capital covenants at December 31, 2021.

Revolving Credit Facility

As of December 31, 2021, the Company had $2,777 outstanding under the Revolving Credit Facility. Lifeway had $2,223 available for future borrowings under the Revolving Credit Facility as of December 31, 2021. Lifeway’s interest rate on debt outstanding under the Revolving Credit Facility as of December 31, 2021 was 2.15%.

Deferred Financing Costs

As of December 31, 2021, net unamortized deferred financing costs of $30 related to the term loan were included as a direct deduction from outstanding long-term debt.