NOTE 8 – LONG TERM DEBT

On May 7, 2014, the Company and a bank syndicate entered into a loan agreement providing for a senior secured term loan of $350,000 and revolving loan of $100,000 (collectively referred to as the “loans”). On February 1, 2016, $65,000 of the revolving loan was used to fund the Albion International, Inc. acquisition (see Note 2). At December 31, 2016, the Company had a total of $281,500 of debt outstanding. The term loan is payable in quarterly installments of $8,750 commencing on September 30, 2014, with the outstanding principal due on the maturity date. The Company may draw on the revolving loan at its discretion. The revolving loan does not have installments and all outstanding amounts are due on the maturity date. The loans may be voluntarily prepaid in whole or in part without premium or penalty and have a maturity date of May 7, 2019. The loans are subject to an interest rate equal to LIBOR or a fluctuating rate as defined by the loan agreement, at the Company’s discretion, plus an applicable rate. The applicable rate is based upon the Company’s consolidated leverage ratio, as defined in the loan agreement, and the interest rate was 2.27% at December 31, 2016. The Company has $81,000 of undrawn revolving loan at December 31, 2016 that is subject to a commitment fee, which is based on the Company’s consolidated leverage ratio as defined in the loan agreement. The loan agreement contains quarterly covenants requiring the consolidated leverage ratio to be less than a certain maximum ratio and the consolidated fixed charge coverage ratio to exceed a certain minimum ratio. At December 31, 2016, the Company was in compliance with these covenants. Indebtedness under the Company’s loan agreements are secured by assets of the company.

The following table summarizes the future minimum debt payments as of December 31, 2016:

Year	Term loan		Revolving loan		Total
2017	$	35,000	$	-	$	35,000
2018		35,000		-		35,000
2019		192,500		19,000		211,500
Future principle payments		262,500		19,000		281,500
Less unamortized debt financing costs		1,010		-		1,010
Less current portion of long-term debt		35,000		-		35,000
Total long-term debt	$	226,490	$	19,000	$	245,490

Costs associated with the issuance of debt instruments are capitalized as debt discount and amortized over the terms of the respective financing arrangements using the effective interest method. If debt is retired early, the related unamortized costs are expensed in the period the debt is retired. Capitalized costs net of accumulated amortization total $1,010 at December 31, 2016 and are shown net against outstanding principle on the accompanying balance sheet. Amortization expense pertaining to these costs totaled $526 and $603 for the years ended December 31, 2016 and 2015, respectively, and is included in interest expense in the accompanying condensed consolidated statements of earnings.