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Debt
 9 Months Ended
Jun. 30, 2021
Debt Disclosure [Abstract]  
Debt Debt
Long‑term debt consists of the following:
June 30,
2021		September 30,
2020
2021 Term Loan, due April 1, 2028 (1)$475,000 $— 
2021 Revolving Credit Facility, due April 1, 2026 (1)
95,000 — 
2014 Term Loan, due December 20, 2024 (1)— 819,276 
2014 Revolving Credit Facility (1)— — 
Securitization Facility, due April 1, 2024148,151 — 
Equipment Financing, due September 30, 2023 to July 5, 2029, interest rates ranging from 3.13% to 8.07%
83,255 63,918 
Notes Payable, due July 31, 2023455 611 
Mortgage (2)— 1,665 
Total debt801,861 885,470 
Less unamortized deferred financing fees(12,217)(9,436)
Total net debt789,644 876,034 
Less current portion(11,474)(14,339)
Total long‑term debt$778,170 $861,695 
(1)On April 1, 2021, the Company paid off the outstanding balance of the 2014 Term Loan (as defined below) and entered into the 2021 Credit Agreement (as defined below).
(2)In November 2020, the Company paid off the outstanding balance of the mortgage due June 30, 2028.
2014 Credit Agreement
On January 15, 2014, EWT III entered into a First Lien Credit Agreement (as modified, amended or supplemented from time to time, the “2014 Credit Agreement”) and a Second Lien Credit Agreement among EWT III, EWT II, the lenders party thereto and Credit Suisse AG as administrative agent and collateral agent. The term loans outstanding under the Second Lien Credit Agreement were prepaid on October 28, 2016. The 2014 Credit Agreement also made available to the Company a revolving credit facility (the “ 2014 Revolving Credit Facility”) of up to $125,000, with a letter of credit sublimit of up to $45,000. The term loan outstanding under the 2014 Credit Agreement (the “2014 Term Loan”) was scheduled to mature on December 20, 2024, and the 2014 Revolving Credit Facility was scheduled to mature on December 20, 2022. As described below, on April 1, 2021, we completed a refinancing of the outstanding 2014 Term Loan and terminated the 2014 Credit Agreement.
2021 Credit Agreement
On April 1, 2021, EWT III entered into a Credit Agreement (the “2021 Credit Agreement”) among EWT III, as borrower, EWT II, as parent guarantor, the lenders from time to time party thereto, JPMorgan Chase Bank, N.A., as administrative agent and collateral agent, and ING Capital, LLC, as sustainability coordinator. The 2021 Credit Agreement provides for a multi-currency senior secured revolving credit facility in an aggregate principal amount not to exceed the U.S. dollar equivalent of $350,000 (the “2021 Revolving Credit Facility”) and a discounted senior secured term (the “2021 Term Loan”) in the amount of $475,000 (together with the 2021 Revolving Credit Facility, the “Senior Facilities”). The 2021 Credit Agreement also provides for a letter of credit sub-facility not to exceed $60,000. The Senior Facilities are guaranteed by EWT II and certain existing and future direct or indirect wholly-owned domestic subsidiaries of EWT III (together with EWT III, collectively, the “Loan Parties”), and collateralized by a first lien on substantially all of the assets of the Loan Parties, with certain exceptions. In connection with entering into the 2021 Credit Agreement, on April 1, 2021, EWT III repaid all outstanding indebtedness under the 2014 Credit Agreement and terminated that facility.

The 2021 Credit Agreement contains customary representations, warranties, affirmative covenants, and negative covenants, each substantially similar to those included in the 2014 Credit Agreement, including, among other things, a springing maximum first lien leverage ratio of 5.55 to 1.00. The Company did not exceed this ratio during the three months ended June 30, 2021, does not anticipate exceeding this ratio during the year ending September 30, 2021, and therefore does not anticipate any additional repayments during the year ending September 30, 2021. In addition, the Company did not exceed this ratio as noted in the 2014 Credit Agreement during the six months ended March 31, 2021.
With respect to the 2021 Revolving Credit Facility, EWT III is required to pay a commitment fee based on the daily unused portion of the 2021 Revolving Credit Facility, as well as certain other fees to the agents and the arrangers under the Senior Facilities. Amounts outstanding under the Senior Facilities, at EWT III’s option, bear interest at either (i) a Base Rate determined in accordance with the terms of the 2021 Credit Agreement, (ii) with respect to any amounts denominated in U.S. dollars or Sterling, LIBOR, or replacement thereof, as determined in accordance with the terms of the 2021 Credit Agreement, or (iii) with respect to amounts denominated in Euros, the EURIBOR, or replacement thereof, as determined in accordance with the terms of the 2021 Credit Agreement. In the case of the 2021 Revolving Credit Facility, an applicable margin based on the consolidated total leverage of EWT III and its restricted subsidiaries, as calculated in accordance with the terms of the 2021 Credit Agreement, will be added to the interest rate elected by EWT III; provided that the interest rate may be adjusted if EWT III meets certain metrics for a sustainability price adjustment prior to December 31, 2021. In the case of the 2021 Term Loan, a fixed applicable margin, calculated in accordance with the terms of the 2021 Credit Agreement, will be added to the interest rate elected by EWT III.
On April 1, 2021, EWT III borrowed the full amount of $475,000 under the 2021 Term Loan and $105,000 under the 2021 Revolving Credit Facility. The 2021 Term Loan was issued at a discount of $2,375, which is recorded as a contra-liability to the carrying amount of debt issued, and is being amortized to interest expense using the effective interest method. The net proceeds of these borrowings under the Senior Facilities, together with the net proceeds of the Receivables Securitization Program (as defined below) and cash on hand, were used to repay all outstanding indebtedness, in an aggregate principal amount of approximately $814,538, under the 2014 Credit Agreement. The proceeds of the 2021 Revolving Credit Facility may also be used to finance or refinance the working capital and capital expenditures needs of EWT III and certain of its subsidiaries and for general corporate purposes.
The 2021 Term Loan matures on April 1, 2028 and requires quarterly principal payments of $1,188 starting in the fourth quarter of 2021. Subject to the terms of the 2021 Credit Agreement, to the extent not previously paid, any amount owed under the 2021 Revolving Credit Facility will become due and payable in full on April 1, 2026.
At June 30, 2021, the Company had (a) $475,000 outstanding under the 2021 Term Loan at an interest rate of 2.63%, comprised of 0.13% LIBOR plus the 2.50% spread, and (b) $95,000 outstanding under the 2021 Revolving Credit Facility at an interest rate of 2.38%, comprised of 0.13% LIBOR plus the 2.25% spread.
The following table summarizes the amount of the Company’s outstanding borrowings and outstanding letters of credit under the 2021 Revolving Credit Facility as of June 30, 2021, and under the 2014 Revolving Credit Facility as of September 30, 2020.
June 30,
2021		September 30,
2020
Borrowing availability$350,000 $125,000 
Outstanding borrowings95,000 — 
Outstanding letters of credit11,504 12,963 
Unused amounts$243,496 $112,037 
Additional letters of credit under a separate arrangement$— $52 
Receivables Securitization Program
On April 1, 2021, Evoqua Finance LLC (“Evoqua Finance”), an indirect wholly-owned subsidiary of the Company, entered into an accounts receivable securitization program (the “Receivables Securitization Program”) consisting of, among other agreements, (i) a Receivables Financing Agreement (the “Receivables Financing Agreement”) among Evoqua Finance, as the borrower, the lenders from time to time party thereto (the “Receivables Financing Lenders”), PNC Bank, National Association (“PNC Bank”), as administrative agent, Evoqua Water Technologies LLC (“EWT LLC”), an indirect wholly-owned subsidiary of the Company, as initial servicer, and PNC Capital Markets LLC (“PNC Markets”), as structuring agent, pursuant to which the lenders have made available to Evoqua Finance a receivables finance facility (the “Securitization Facility”) in an amount up to $150,000 and (ii) a Sale and Contribution Agreement (the “Sale Agreement”) among Evoqua Finance, as purchaser, EWT LLC, as initial servicer and as an originator, and Neptune Benson, Inc., an indirectly wholly-owned subsidiary of the Company, as an originator (together with EWT LLC, the “Originators”). Under the Receivables Securitization Program, the Originators, pursuant to the Sale Agreement, are required to sell substantially all of their domestic trade receivables and certain related rights to payment and obligations of the Originators with respect to such receivables (the “Receivables”) to Evoqua Finance, which, in turn, will obtain loans secured by the Receivables from the Receivables Financing Lenders pursuant to the Receivables Financing Agreement. The Receivables underlying any borrowings will continue to be included in Accounts receivable, net, in the Consolidated Balance Sheets of the Company. On April 1, 2021, Evoqua Finance borrowed $142,200 under the Securitization Facility. During the third quarter of 2021, Evoqua Finance borrowed an additional amount under the Securitization Facility and had $148,151 outstanding at June 30, 2021 which includes $51 of accrued interest.
The Receivables Securitization Program contains certain customary representations, warranties, affirmative covenants, and negative covenants, subject to certain cure periods in some cases, including the eligibility of the Receivables being sold by the Originators and securing the loans made by the Receivables Financing Lenders, as well as customary reserve requirements, events of default, termination events, and servicer defaults. The Company was in compliance with all covenants during the three months ended June 30, 2021, does not anticipate becoming noncompliant during the year ending September 30, 2021, and therefore does not anticipate any additional repayments during the year ending September 30, 2021.
The Receivables Financing Lenders under the Receivables Securitization Program receive interest at LIBOR or LMIR as selected by Evoqua Finance. The Receivables Financing Agreement contains customary LIBOR benchmark replacement language. The interest rate on the Securitization Facility was 1.35% as of June 30, 2021, comprised of 0.10% LIBOR plus the 1.25% spread. The Receivables Securitization Program matures on April 1, 2024.
Equipment Financings
During the nine months ended June 30, 2021, the Company completed the following equipment financings:
Date EnteredDueInterest Rate at 6/30/2021Principal Amount
June 30, 2021June 30, 20283.85 %$1,348 
June 30, 2021
July 31, 2029(1)
4.75 %8,378 
June 30, 2021June 30, 20294.09 %1,653 
March 31, 2021March 31, 20283.85 %3,630 
March 31, 2021June 30, 20294.09 %2,559
December 31, 2020June 30, 20294.09 %3,899
December 30, 2020December 30, 20273.73 %3,905
$25,372 
(1)    Represents an advance received from the lender on a multiple draw term loan in which the Company is making interest only payments through August 1, 2022 based on a 1.00% LIBOR floor plus a 3.75% spread. The Company entered into an interest rate swap with an effective date of August 1, 2022 to mitigate risk associated with this variable rate equipment financing, see Note 12, “Derivative Financial Instruments” for further discussion.
Deferred Financing Fees and Discounts
Deferred financing fees and discounts related to the Company’s long-term debt were included as a contra liability to debt on the Consolidated Balance Sheets as follows:
June 30,
2021		September 30,
2020
Current portion of deferred financing fees and discounts (1)$(1,791)$(2,112)
Long-term portion of deferred financing fees and discounts (2)(10,426)(7,324)
Total deferred financing fees and discounts$(12,217)$(9,436)
(1)Included in Current portion of debt, net of deferred financing fees and discounts on the Consolidated Balance Sheets.
(2)Included in Long-term debt, net of deferred financing fees and discounts on the Consolidated Balance Sheets.
As a result of the refinancing on April 1, 2021, the Company wrote off approximately $1,333 of deferred financing fees related to the 2014 Term Loan. In addition, the Company incurred approximately $4,985 of fees, of which approximately $1,931 were recorded as deferred financing fees on the Consolidated Balance Sheets and approximately $3,054 were expensed. During the nine months ended June 30, 2021, the Company incurred approximately $822 of fees related to the Receivables Securitization Program and $467 of fees related to an equipment financing which were recorded as deferred financing fees on the Consolidated Balance Sheets.
Amortization of deferred financing fees and discounts included in interest expense were $437 and $277 for the three months ended June 30, 2021 and 2020, respectively and $1,481 and $1,213 for the nine months ended June 30, 2021 and 2020, respectively.
Repayment Schedule
Aggregate maturities of all long‑term debt, including current portion of long‑term debt and excluding finance lease obligations as of June 30, 2021, are presented below:
Fiscal Year
Remainder of 2021$3,372 
202213,612 
202314,536 
2024161,158 
202514,579 
Thereafter
594,604 
Total
$801,861