NOTE 9. LONG-TERM DEBT

As of June 30, 2020, the Company’s outstanding indebtedness, at face value, was as follows:


	Face Value Debt		Stated Interest Rate	Maturity Date
Credit Facility	$	70,000,000	30-Day LIBOR + 1.35% - 1.95% (1)	November 2023
Total Debt/Weighted-Average Rate	$	70,000,000	1.74%

⁽¹⁾

Effective April 30, 2020, the Company utilized an Interest Rate Swap to achieve a fixed interest rate of 0.48% plus the applicable spread on approximately $50 million of the outstanding balance on the Credit Facility.

Credit Facility. On November 26, 2019, the Company and the Operating Partnership entered into a credit agreement (the “Credit Agreement”) with a group of lenders for a senior unsecured revolving credit facility (the “Credit Facility”) in the maximum aggregate initial original principal amount of up to $100 million. BMO Capital Markets Corp. and Raymond James Bank, N.A. are joint lead arrangers and joint bookrunners, with Bank of Montreal (“BMO”) as administrative agent.

The Credit Facility has a term of four years, with the ability to extend the term for one year. The Credit Facility has an accordion feature that may allow the Operating Partnership to increase the availability under the Credit Facility by an additional $50 million, subject to meeting specified requirements and obtaining additional commitments from lenders.

Pursuant to the Credit Agreement, the indebtedness outstanding under the Credit Facility accrues at a rate ranging from the 30-day LIBOR plus 135 basis points to the 30-day LIBOR plus 195 basis points based on the total balance outstanding under the Credit Facility as a percentage of the total asset value of the Operating Partnership, as defined in the Credit Agreement.

The Operating Partnership is subject to customary restrictive covenants under the Credit Facility, including, but not limited to, limitations on the Operating Partnership’s ability to: (a) incur indebtedness; (b) make certain investments; (c) incur certain liens; (d) engage in certain affiliate transactions; and (e) engage in certain major transactions such as mergers. The Credit Facility also contains financial covenants covering the Operating Partnership, including but not limited to, tangible net worth and fixed charge coverage ratio. In addition, the Operating Partnership is subject to additional financial maintenance covenants as described in the Credit Agreement. On June 30, 2020, the Company and the Operating Partnership entered into the First Amendment to the Credit Agreement with the lenders (the “First Amendment”) whereby the tangible net worth covenant was adjusted to be more reflective of market terms.

At June 30, 2020, the current commitment level under the Credit Facility was $100.0 million. The available borrowing capacity under the Credit Facility was $30.0 million, based on the level of borrowing base assets. As of June 30, 2020, the Credit Facility had an outstanding balance of $70.0 million. See Note 1, “Business and Organization” for a discussion of the potential impact on borrowing base assets due to the COVID-19 Pandemic.

Long-term debt as of June 30, 2020 and December 31, 2019 consisted of the following:


	June 30, 2020				December 31, 2019
	Total		Due Within One Year		Total		Due Within One Year
Credit Facility	$	70,000,000	$	—	$	—	$	—
Loan Costs, net of accumulated amortization		(492,536)		—		—		—
Total Long-Term Debt	$	69,507,464	$	—	$	—	$	—

Payments applicable to reduction of principal amounts as of June 30, 2020 will be required as follows:


Year Ending December 31,	Amount
Remainder of 2020	$	—
2021		—
2022		—
2023		70,000,000
2024		—
2025 and thereafter		—
Total Long-Term Debt - Face Value	$	70,000,000

As of June 30, 2020, the Company’s long-term debt includes initial deferred financing costs of approximately $594,000, net of accumulated amortization, of approximately $101,000. These costs are amortized on a straight-line basis over the term of the Credit Facility and are included in interest expense in the Company’s accompanying consolidated and combined statements of operations. As of December 31, 2019, these costs were reflected as deferred expenses on the accompanying consolidated balance sheets as there was no outstanding debt as of December 31, 2019.

The following table reflects a summary of interest expense incurred and paid during the three and six months ended June 30, 2020 and 2019:


	Three Months Ended				Six Months Ended
	June 30, 2020		June 30, 2019		June 30, 2020		June 30, 2019
	The Company ($000's)		Predecessor ($000's)		The Company ($000's)		Predecessor ($000's)
Interest Expense	$	299	$	—	$	504	$	—
Amortization of Loan Costs		44		—		88		—
Total Interest Expense	$	343	$	—	$	592	$	—

Total Interest Paid	$	337	$	—	$	501	$	—

The Company was in compliance with all of its debt covenants as of June 30, 2020.