Debt

6 Months Ended

Mar. 31, 2022

Debt consists of:


	March 31, 2022		September 30, 2021
Revolving credit agreement	$	12,838	$	8,930
Foreign subsidiary borrowings	6,809		6,632
Finance lease obligations	10		22
Other, net of unamortized debt issuance costs $(26) and $(32), respectively	706		5,581



Total debt	20,363		21,165

Less – current maturities	(17,097)		(18,496)
Total long-term debt	$	3,266	$	2,669

Credit Agreement and Security Agreement

The Credit Agreement (as amended, the "Credit Agreement") contains affirmative and negative covenants and events of default. On March 23, 2022, the Company entered into the Sixth Amendment (the "Sixth Amendment") to the Credit Agreement (as previously amended, the "Credit Agreement") and the Second Amendment (the "Second Amendment") to the Export Credit Agreement (the "Export Credit Agreement"), with its lender. The total collateral at March 31, 2022 and September 30, 2021 was $26,126 and $25,370, respectively, and the revolving commitment was $35,000 for both periods. Total availability at March 31, 2022 and September 30, 2021 was $12,759 and $14,570, respectively, which exceed both the collateral and total commitment threshold. Since the availability was greater than the 10.0% of the revolving commitment as of March 31, 2022 and September 30, 2021, no covenant calculations were required. The Company has letter of credit balance of $1,800 as of March 31, 2022 and September 30, 2021, respectively.

The Sixth Amendment amends the Credit Agreement to, among other things, (i) revise the fixed coverage ratio to exclude the first $1,500 of unfunded capital expenditures through April 20, 2023, (ii) increase the letter of credit sub-limit from $2,000 to $3,000, (iii) modify the reference rate from the London interbank offered rate ("LIBOR") to the secured overnight financing rate ("SOFR") under the Credit Agreement, and (iv) revise the property, plant and equipment component of the borrowing base under the Credit Agreement.

The Second Amendment amends the Export Credit Agreement to replace the reference rate from LIBOR to SOFR under the Export Credit Agreement.

The revolver has a rate based on SOFR plus 2.0% spread, which was 2.3% at March 31, 2022 and a rate based on LIBOR plus 1.75% spread, which was 1.8% at September 30, 2021. The Export Credit Agreement as amended has a rate based on SOFR plus 1.5% spread, which was 1.8% at March 31, 2022 and a rate based on LIBOR plus 1.25% spread, which was 1.3% at September 30, 2021, respectively. The Company also has a commitment fee of 0.25% under the Credit Agreement as amended to be incurred on the unused balance of the revolver.

Foreign subsidiary borrowings

Foreign debt consists of:


	March 31, 2022		September 30, 2021
Term loan	$	3,545	$	3,127
Short-term borrowings	2,553		1,867
Factor	711		1,638
Total debt	$	6,809	$	6,632

Less – current maturities	(4,012)		(4,551)
Total long-term debt	$	2,797	$	2,081

Receivables pledged as collateral	$	594	$	485

Interest rates on foreign borrowings are based on Euribor rates which range from 1.0% to 4.2%.

The Maniago, Italy ("Maniago") location obtained borrowings from one lender in the first six months of fiscal 2022. The loan was for $1,141 with repayment terms of six years. Under the terms of the borrowing, repayments are made quarterly in the amount of $56, beginning on December 31, 2022.

The Company factors receivables from one of its customers. The Company accounts for the pledge of receivables under this agreement as short-term debt and continues to carry the receivables on its consolidated condensed balance sheets.

Debt issuance costs

The Company had debt issuance costs of $86, which is included in the consolidated condensed balance sheets as a deferred charge in other current assets, net of amortization of $31 and $17 at March 31, 2022 and September 30, 2021, respectively.

Other

As of March 31, 2022 and September 30, 2021, the Paycheck Protection Program loan (the "PPP Loan") balance was $0 and $4,764, respectively. The Company applied for forgiveness of the full amount of the PPP Loan to the Small Business Administration ("SBA") and was notified by the SBA in January 2022 that the full PPP Loan originating amount of $5,025 was forgiven. All accrued interest was forgiven and the amount previously repaid by the Company of $261 was reimbursed to the Company by its lender. The Company elected to treat the PPP Loan as debt under FASB Topic 470. As such, the Company derecognized the liability in the second quarter of fiscal 2022 when the loan was forgiven and the Company was legally released from the loan. The gain on extinguishment of loan is included in the consolidated condensed statements of operations in the amount of $5,106 (includes $81 of interest forgiven).