BANK DEBT

The Company entered into a Credit Agreement on

June 1, 2017

with JPMorgan Chase Bank, N.A. as lender, which was subsequently amended in connection with funding the acquisition of CAD Enterprises, Inc. (“CAD”) on

July 5, 2018 (

as amended, the “Credit Agreement”). As amended, the Credit Agreement is comprised of a revolving facility in the amount of

$12,000,000,

subject to a borrowing base (determined based on

80%

of Eligible Accounts, plus

50%

of Eligible Progress Billing Accounts, plus

50%

of Eligible Inventory, minus Reserves, each as defined in the Credit Agreement) and a term A loan in the amount of

$6,000,000.

Outstanding borrowings on the term A loan are payable in consecutive monthly installments, which currently amount to

$111,111

per month. The Credit Agreement was amended on

September 30, 2019

to expand the revolving loan amount from

$12,000,000

$20,000,000,

subject to a borrowing base, and to extend the maturity of revolving facility from

June 1, 2021

June 1, 2024.

The Credit Agreement was amended on

December 30, 2019

to eliminate the borrowing base.

The revolving facility under the Credit Agreement includes a

million sublimit for the issuance of letters of credit thereunder. [The Credit Agreement also provides for a separate credit line for borrowings of up to an aggregate of

$1,000,000

for capital expenditures until

July 5, 2019,

at which time any outstanding capital expenditure borrowings will be converted into a term loan maturing at the earlier of

five

years after such conversion or the termination of the revolving credit facility.]

The Company did

not

borrow from this credit line prior to its expiration. Interest for borrowings under the revolving facility accrues at a per annum rate equal to Prime Rate or LIBOR plus applicable margins of (i) (

0.25%

) for Prime Rate loans and (ii)

1.75%

for LIBOR loans. The maturity date of the revolving facility is

June 1, 2024.

Interest for borrowings under the term A loan accrues at a per annum rate equal to Prime Rate or LIBOR plus applicable margins of (i)

0.25%

for Prime Rate loans and (ii)

2.25%

for LIBOR loans. The maturity date of the term A loan is

December 1, 2022.

The Credit Agreement includes a commitment fee on the unused portion of the revolving facility of

0.25%

per annum payable quarterly. The obligations of the Company and other borrowers under the Credit Agreement are secured by a blanket lien on all the assets of the Company and its subsidiaries. The Credit Agreement also includes customary representations and warranties and applicable reporting requirements and covenants. The financial covenants under the Credit Agreement include a minimum fixed charge coverage ratio, a maximum senior funded debt to EBITDA ratio and a maximum total funded debt to EBITDA ratio.

Bank debt balances consist of the following:

	December 31, 201 9		December 31, 2018

Term Debt	$	4,111,111	$	5,444,444
Revolving Debt		3,722,995		4,184,158
Total Bank Debt		7,834,106		9,628,602
Less: Current Portion		1,333,333		1,333,333
Non-Current Bank Debt		6,500,773		8,295,269
Less: Unamortized Debt Costs		124,179		100,590
Net Non-Current Bank Debt	$	6,376,594	$	8,194,679

Minimum principal payments due on the term loan until maturity are:

	Term Loan

2020	$	1,333,333
2021		1,333,333
2022		1,444,445
Total principal payments	$	4,111,111

The Company had

$16.3

million and

$7.8

million available to borrow on the revolving credit facility at

December 31, 2019

and

2018,

respectively.