Long-term Debt and Line of Credit

12 Months Ended

Sep. 30, 2022

Long-term Debt and Line of Credit [Abstract]

11.	Long-term Debt and Line of Credit

On August 9, 2022, the Company and certain of its subsidiaries entered into the Amended and Restated Credit Agreement (the “A&R Credit Facility”) with Truist Bank. The A&R Credit Facility provides for a $65.0 million revolving credit facility (the “A&R Revolving Facility”) that may be used for revolving credit loans (including up to $5.0 million in swingline loans and up to $5.0 million in letters of credit) and a $445.0 million term loan (the “A&R Term Loan”). Subject to certain conditions, the available amount under the revolving credit facility and term loans may be increased by $125.0 million in the aggregate. The A&R Credit Facility bears interest at a rate that is equal to Term SOFR plus an applicable margin ranging from 1.75% to 2.75% based on certain consolidated leverage ratio measures. The A&R Revolving Facility matures on August 9, 2027. The A&R Term Loan is repayable in installments beginning December 31, 2022, with the remainder due on August 9, 2027.

The A&R Credit Facility is collateralized by certain real and personal property (including certain capital stock) of the Company and its subsidiaries. The collateral does not include inventory and certain other assets of the Company’s subsidiaries financed under the Inventory Financing Facility. The A&R Credit Facility is subject to certain financial covenants related to the maintenance of a minimum fixed charge coverage ratio and a maximum consolidated leverage ratio. The A&R Credit Facility also contains non-financial covenants and restrictive provisions that, among other things, limit the ability of the Company to incur additional debt, transfer or dispose of all of its assets, make certain investments, loans or payments and engage in certain transactions with affiliates. The Company was in compliance with all covenants at September 30, 2022.

On November 30, 2021, the Company and certain of its subsidiaries entered into Incremental Amendment No. 2 (the “Second Amendment”) to the Credit Facility (as defined below) with Truist Bank. The Second Amendment amends the Credit Facility to, among other things, provide for an incremental term loan (the “Incremental Term Loan”) in an aggregate principal amount equal to $200.0 million which will be added to, and constitute part of, the existing $110.0 million term loan and will be on the same terms applicable to the existing term loan under the Credit Facility. Additionally, the Second Amendment further provides a $20.0 million increase in the revolving commitment, which will be added to, and constitute part of, the existing $30.0 revolving commitment.

On February 2, 2021, the Company entered into Incremental Amendment No. 1 (the “First Amendment”) to Amend the Credit Facility (as defined below), to among other things, provide for an incremental term loan in an aggregate principal amount equal to $30.0 million, which will be added to, and constitute a part of, the existing $80.0 million term loan. The First Amendment was on the same terms applicable to the existing term loan.

On July 22, 2020, the Company entered into a Credit Agreement (the “Credit Facility”), with Truist Bank. The Credit Facility provides for a $30.0 million revolving credit facility that may be used for revolving credit loans (including up to $5.0 million in swingline loans) and up to $5.0 million in letters of credit from time to time, and a $80.0 million term loan. Subject to certain conditions, the available amount under the revolving credit facility and the term loans may be increased by $50.0 million in the aggregate. The Credit Facility bears interest at a rate that is equal to LIBOR for such interest period plus an applicable margin of up to 3.00%, subject to step-downs to be determined based on the consolidated leverage ratio. The revolving credit facility is subject to an unused line fee of up to 0.40%, subject to step-downs to be determined based on the consolidated leverage ratio.

Long-term debt consisted of the following at:

($ in thousands)	September 30, 2022			September 30, 2021
Term note payable to Truist Bank, secured and bearing interest at 5.31% at September 30, 2022 and 2.75% at September 30, 2021. The note requires quarterly principal payments commencing on December 31, 2022 and maturing with a full repayment on August 9, 2027	$	445,000		$	105,875
Revolving note payable for an amount up to $65.0 million to Truist Bank		-			-
Notes payable to commercial vehicle lenders secured by the value of the vehicles bearing interest at rates ranging from 0.0% to 8.9% per annum. The notes require monthly installment payments of principal and interest ranging from $100 to $5,600 through October 2028		4,173			3,248
Note payable to Tom George Yacht Group, unsecured and bearing interest at 5.5% per annum. The note requires monthly interest payments, with a balloon payment of principal due on December 1, 2023		2,056			2,056
Note payable to Norfolk Marine Company, unsecured and bearing interest at 4.0% per annum. The note requires quarterly interest payments, with a balloon payment of principal due on December 1, 2024.		1,126			-
Note payable to Central Marine Services, Inc., unsecured and bearing interest at 5.5% per annum. The note was repaid in full on February 1, 2022.		-			2,164
Note payable to Ocean Blue Yacht Sales, unsecured and bearing interest at 5.0% per annum. The note was repaid in full on February 1, 2022.		-			1,920
Note payable to Slalom Shop, LLC, unsecured and bearing interest at 5.0% per annum. The note was repaid in full on December 1, 2021.		-			1,271
Total debt outstanding		452,355			116,534
Less current portion (net of current debt issuance costs)		(21,642	)		(11,366	)
Less unamortized portion of debt issuance costs		(9,551	)		(2,094	)
Long-term debt, net of current portion and unamortized debt issuance costs	$	421,162		$	103,074

Principal repayment requirements of long-term debt at September 30, 2022 are as follows (in thousands):

Year ending September 30,
2023	$	23,671
2024		25,506
2025		35,433
2026		45,014
2027		322,731
Total principal payments	$	452,355

Debt issuance costs are amortized on a straight-line basis over the life of the loan, which approximates the effective interest method. During the fiscal year ended 2022 and 2021, the Company capitalized loan costs of $9.1 million and $0.7 million, respectively, and had accumulated amortization of $1.9 million and $0.8 million as of September 30, 2022 and 2021, respectively. In connection with entering into the A&R Credit Facility, the Company wrote off unamortized debt issuance cost of $0.4 million which was included in loss on extinguishment of debt in the Consolidated Statements of Operations for the year ended September 30, 2022. In connection with the prepayment of the Term and Revolver Credit Facility with Goldman Sachs Specialty Lending Group, L.P., the Company wrote off unamortized debt issuance costs of $2.4 million which was included in loss on extinguishment of debt in the Consolidated Statement of Operations for the year ended September 30, 2020. Amortization for the years ended September 30, 2022, 2021 and 2020 amounted to $1.3 million, $0.7 million and $0.4 million, respectively, and is included in interest expense.

As of September 30, 2022, the Company had $0.4 million in letters of credit outstanding under the A&R Revolving Facility.