Long-Term Debt and Capital Lease Obligations

FY2017 Revolving Credit Facility

On January 31, 2017, the Company entered into a credit agreement (the “Credit Agreement”) with Citizens Bank, N.A. as lender, LC issuer, administrative agent, sole lead arranger, and sole book runner; BMO Harris Bank, N.A. as lender, LC issuer and syndication agent; KeyBank, N.A. as lender and documentation agent, and five other banks as lenders. The Credit Agreement provides the Company with a $250,000 five-year secured revolving credit facility (“Revolving Facility”) with a sublimit of $15,000 available for the issuance of letters of credit. The Credit Agreement replaced the Company’s prior credit facility with Citizens Bank, N.A. (the “Prior Credit Agreement”) converting the existing amortizing term loan and revolving borrowing structure to a non-amortizing, fully revolving format. The Revolving Facility will be available for working capital and general corporate purposes as permitted under the Credit Agreement. The Credit Agreement includes borrowing capacity for letters of credit and for borrowings on same-day notice, referred to as “swingline loans.” Borrowings under the Credit Agreement are subject to the satisfaction of customary conditions, including absence of defaults and accuracy of representations and warranties. Under the terms of the Credit Agreement, the amount of the Revolving Facility may be increased through incremental revolving commitments, subject to a cap of an additional $75,000. The commitments under the Credit Agreement may be reduced, in whole or in part, without premium or penalty. Any borrowings outstanding under the Credit Agreement will mature on January 31, 2022.

Amounts outstanding under the Credit Agreement bear interest at the Base Rate (as defined, generally the prime rate) plus a margin of 0.50% to 1.75%, or at the Eurodollar Rate (as defined, generally the Libor rate) plus a margin of 1.50% to 2.75%, based on the Company's Leverage Ratio (as defined). In addition to these borrowing rates, there is a commitment fee which ranges from 0.20% to 0.50% (based on the Leverage Ratio) on any unused commitments. The applicable fees for issuance of letters of credit under the Revolving Facility is a range of 1.50% to 2.75%, also based on the Leverage Ratio.

The Company’s obligations under the Credit Agreement are secured by a pledge of substantially all of its assets and guaranteed by its principal operating subsidiaries. The Credit Agreement also contains cross-default provisions which become effective if the Company defaults on other indebtedness.

The Credit Agreement contains customary restrictive covenants that limit the Company's ability to, among other things: incur additional indebtedness or enter into guarantees; enter into sale/leaseback transactions; make investments, loans or acquisitions; grant or incur liens on its assets; sell its assets; engage in mergers, consolidations, liquidations or dissolutions; engage in transactions with affiliates; and make restricted payments. Under the Credit Agreement the Company is required to maintain a fixed charge coverage ratio of no less than 1.25 to 1.00 and to not permit its leverage ratio to exceed 3.00 to 1.00.

On January 31, 2017 the Company utilized $15,000 of cash on hand to pay down the existing $69,375 of Term Loan borrowings outstanding under the Prior Credit Agreement, resulting in an initial $54,375 borrowed under the Credit Agreement's Revolving Facility.

At March 31, 2017, the Company had $65,375 outstanding under the Credit Agreement. Funds available to borrow under the Credit Agreement, after consideration of letters of credit outstanding, were $86,306 at March 31, 2017.

In accounting for the transaction costs incurred in conjunction with the Credit Agreement, an additional $755 was capitalized, the Company carried forward $2,278 total costs incurred from Prior Credit Agreement, and immediately expensed $293 for costs associated with a non-participating lender. The March 31, 2017 balance of $2,932 will be amortized ratably over the term of the Credit Agreement.

FY2016 Revolving Credit Facility

On November 30, 2015, the Company entered into a five-year credit agreement (the “Prior Credit Agreement”) with Citizens Bank, N.A. as lender, LC issuer, administrative agent, sole lead arranger, and sole book runner; BMO Harris Bank, N.A. as lender, LC issuer and syndication agent; KeyBank, N.A. as lender and document agent, and five other banks as lenders. The Prior Credit Agreement provided the Company with an aggregate borrowing capacity of $175,000, consisting of a $100,000 five-year secured revolving credit facility (“Prior Revolving Facility”) with a sub-limit of $15,000 available for the issuance of letters of credit, as well as a five-year secured $75,000 term loan (“Term Loan”).

The proceeds of the Term Loan, together with cash on hand and proceeds from borrowing under the Prior Revolving Facility, were used to pay the purchase price for Willbros Professional Services ("Oil and Gas") and to fund transaction costs incurred in connection with the Oil and Gas acquisition. The Prior Revolving Facility also is available for working capital and general corporate purposes. The Prior Revolving Facility included borrowing capacity for letters of credit and for borrowings on same-day notice, referred to as “swingline loans.” Borrowings under the Prior Revolving Facility were subject to the satisfaction of customary conditions, including absence of defaults and accuracy of representations and warranties. The Company could request an increase in the amount of the Credit Agreement up to an additional $75,000, through additional term or revolving loans.

Borrowings outstanding under the Prior Revolving Facility would have matured on November 30, 2020. The Term Loan amortized in quarterly installments payable on the last day of each March, June, September, and December, commencing on March 31, 2016 in amounts equal to 1.875% of the term loan made or outstanding, with the balance payable on November 30, 2020 (the "Term Loan Maturity Date"). In addition, the Company was required, subject to certain exceptions, to make payments on the Term Loan (a) based on a stated percentage of Excess Cash Flow, either 50% or 0% depending on whether the Company's consolidated leverage is above or below 2 times adjusted EBITDA as defined in the Prior Credit Agreement, (b) in an amount of 100% of net cash proceeds from asset sales subject to certain reinvestment rights, (c) in an amount of 100% of net cash proceeds of any issuance of debt other than debt permitted to be incurred under the Prior Credit Agreement, and (d) in an amount of 100% of net cash proceeds from events of loss subject to certain reinvestment rights. The borrowings under the Prior Credit Agreement could be reduced, in whole or in part, without premium or penalty.

Amounts outstanding under the Prior Credit Agreement bore interest at the Base Rate (as defined, generally the prime rate) plus a margin of 0.50% to 1.25%, or at the Eurodollar Rate (as defined, generally the LIBOR rate) plus a margin of 1.50% to 2.25%, based on the Company's Leverage Ratio (as defined). In addition to these borrowing rates, there was a commitment fee which ranged from 0.20% to 0.375% on any unused commitments. The applicable fees for issuance of letters of credit under the Prior Revolving Facility was a range from 1.50% to 2.25%.

The Company’s obligations under the Prior Credit Agreement were secured by a pledge of substantially all of its assets and guaranteed by its principal operating subsidiaries. The Prior Credit Agreement also contained cross-default provisions which became effective if the Company defaulted on other indebtedness.

The Prior Credit Agreement contained various customary restrictive covenants that limited the Company's ability to, among other things: incur additional indebtedness including guarantees; enter into sale/leaseback transactions; make investments, loans or acquisitions; grant or incur liens on its assets; sell its assets; engage in mergers, consolidations, liquidations or dissolutions; engage in transactions with affiliates; and make restricted payments. Under the Prior Credit Agreement the Company was required to maintain a fixed charge coverage ratio of no less than 1.25 to 1.00 and to not permit its leverage ratio to exceed 3.00 to 1.00. The Credit Agreement also limited the payment of cash dividends to $10,000 in aggregate during its term.

On November 30, 2015, the Company borrowed $102,000 under the Credit Agreement to partially fund the Oil and Gas acquisition. The borrowing was comprised of a full borrowing of the $75,000 term loan and a $27,000 borrowing under the Prior Revolving Facility. Borrowings under the Term Loan bore interest at a stated rate of 2.11% and had an effective interest rate of 2.15% when paid in full at January 31, 2017.

Contractor-owned, contractor-operated (CoCo) facility debt

As of March 31, 2017, the Company had approximately $16,922 of debt obligations ("CoCo" debt) assumed in the Oil and Gas acquisition, of which $6,766 was current. A third party finance company had provided financing to Oil and Gas in conjunction with the construction of fueling facilities for the federal government pursuant to three government contracts. Upon acceptance of the constructed facilities, the federal government pays Oil and Gas in equal monthly installments over the subsequent five years. Therefore, as of March 31, 2017, the Company also had recorded approximately $16,922 of receivables which were acquired in the transaction, of which $6,766 was current. These amounts were recorded within other assets and represent the amount due from the federal government for the construction of the fueling facilities. As of March 31, 2017, the government has provided acceptance and final funding on all three contracts.

The principal amounts due under the Company’s remaining CoCo debt obligations as of March 31, 2017 for the remainder of fiscal year 2017 and succeeding fiscal years is as follows:



2017		$	2,103
2018		5,734
2019		3,717
2020		3,980
2021		1,388
	Total	$	16,922

Other Notes Payable

In July 2016, the Company financed $3,838 of insurance premiums payable in seven equal monthly installments of $552 each, including a finance charge of 2.19%. As of March 31, 2017, the balance outstanding under this agreement was $0.

In conjunction with the Caltrop acquisition, the Company entered into a three-year subordinated promissory note in the principal amount of $8,500 bearing 3% interest, of which $4,000 is current.

In conjunction with the Oil and Gas acquisition, the Company was required to remit a second cash payment of $7,500 payable at the earlier of certain Willbros contract novations (or written approval of a subcontract) and Willbros obtaining certain consents, or March 15, 2016. The second cash payment was made in two tranches, with $2,354 paid in March 2016 and the remaining balance paid in July 2016 in conjunction with the final net working capital settlement.