Debt

12 Months Ended

Dec. 31, 2015

Debt Disclosure [Abstract]

Debt

4. Debt

On October 1, 2015, HWC Wire & Cable Company, as borrower, entered into the Fourth Amended and Restated Loan and Security Agreement (the “2015 Loan Agreement”), with Bank of America, N.A., as agent and lender, and the Company, as guarantor, executed a Third Amended and Restated Guaranty of the borrower’s obligations thereunder. The 2015 Loan Agreement provides a $100 million revolving credit facility, bears interest at the agent’s base rate, with a London Interbank Offered Rate (“LIBOR”) rate option and expires on September 30, 2020. Under certain circumstances the Company may request an increase in the commitment by an additional $50 million. The 2015 Loan Agreement is secured by substantially all of the property of the Company, other than real estate. Availability under the 2015 Loan Agreement is limited to a borrowing base equal to 85% of the value of eligible accounts receivable, plus the lesser of 70% of the value of eligible inventory or 90% of the net orderly liquidation value percentage of the value of eligible inventory, in each case less certain reserves.

Portions of the loan may be converted to LIBOR loans in minimum amounts of $1,000 and integral multiples of $100. LIBOR loans bear interest at the British Bankers Association LIBOR Rate plus 100 to 150 basis points based on availability, and loans not converted to LIBOR loans bear interest at a fluctuating rate equal to the greatest of the agent’s prime rate, the federal funds rate plus 50 basis points, or 30-day LIBOR plus 150 basis points. The unused commitment fee is 25 basis points.

The 2015 Loan Agreement includes, among other things, covenants that require the Company to maintain a specified minimum fixed charge coverage ratio, unless certain availability levels exist. Additionally, the 2015 Loan Agreement allows for the unlimited payment of dividends and repurchases of stock, subject to the absence of events of default and maintenance of a fixed charge coverage ratio and minimum level of availability. The 2015 Loan Agreement contains certain provisions that may cause the debt to be classified as a current liability, in accordance with GAAP, if availability falls below certain thresholds, even though the ultimate maturity date under the loan agreement remains as September 30, 2020. At December 31, 2015, the Company was in compliance with the availability-based covenants governing its indebtedness.

The Company’s borrowings at December 31, 2015 and 2014 were $39,188 and $53,847, respectively. The weighted average interest rates on outstanding borrowings were 1.7% and 1.9% at December 31, 2015 and 2014, respectively.

During 2015, the Company had an average available borrowing capacity of approximately $46,562. This average was computed from the monthly borrowing base certificates prepared for the lender. At December 31, 2015, the Company had available borrowing capacity of $41,519 under the terms of the 2015 Loan Agreement. During the years ended December 31, 2015, 2014 and 2013, the Company paid $153, $114, and $130, respectively, for the unused facility.

Principal repayment obligations for succeeding fiscal years are as follows:

2016	$	—
2017		—
2018		—
2019		—
2020		39,188
Total	$	39,188