Note 6 - Debt
|12 Months Ended|
Jun. 30, 2018
|Notes to Financial Statements|
|Debt Disclosure [Text Block]||
Total debt obligations at
June 30consist of the following (in thousands):
The Company entered into a
$150million senior secured revolving credit and term loan facility on
October 21, 2014,as amended (the “Facility”). The Company intends to use the Facility for working capital and general corporate purposes, including dividend payments and share repurchases. The Facility, which expires on
October 21, 2019,provided a term loan of up to
$35million and a revolving credit line of up to
$115million, subject to borrowing base availability. We incurred financing costs of
$1.5million under the Facility, which are being amortized by the interest method, over the remaining life of the Facility.
At the Company’s option, revolving loans under the Facility bear interest, based on the average availability, at an annual rate of either (a) the London Interbank Offered rate (“LIBOR”) plus
1.75%,or (b) the higher of (i) the prime rate, (ii) the federal funds effective rate plus
0.50%,or (iii) LIBOR plus
1.0%plus in each case
The Company pays a commitment fee of
0.25%per annum on the unused portion of the Facility, and fees on issued letters of credit at an annual rate of
1.75%based on the average availability. Certain payments are restricted if the availability under the revolving credit line falls below
20%of the total revolving credit line, and the Company is subject to pro forma compliance with the fixed charge coverage ratio if applicable.
2018the Company repaid the remaining balance of
$13.8million on the term loan with excess operating cash. In fiscal
$25.0million of the revolving credit facility with excess operating cash.
The Facility is secured by all property owned, leased or operated by the Company in the United States and includes certain real property owned by the Company and contains customary covenants which
maylimit the Company’s ability to incur debt; engage in mergers and consolidations; make restricted payments (including dividends and share repurchases); sell certain assets; and make investments.
The Facility includes a covenant that requires the Company to maintain a minimum fixed charge coverage ratio of
1.0at all times unless the outstanding term loans are less than
$17.5million and the fixed charge coverage ratio equals or exceeds
1.0,in which case the fixed charge coverage ratio ceases to apply and thereafter is only triggered if average monthly availability is less than
15%of the amount of the revolving credit line. The Company has met the exemption conditions and is currently exempt from the fixed charge coverage ratio covenant.
June 30, 2018and
June 30, 2017,there was
$0.1million respectively, of standby letters of credit outstanding under the Facility. In fiscal
2018we issued a
$5.9million letter of credit for our workmen’s compensation obligation in lieu of restricted cash, resulting in reclassification of this restricted cash to cash and cash equivalents. Total availability under the Facility was
June 30, 2018and
June 30, 2017.
June 30, 2018and
June 30, 2017,we were in compliance with all covenants under the Facility.
The weighted-average interest rate applicable under our outstanding debt obligations for each of the last
threefiscal years were as follows:
Aggregate scheduled maturities of our debt obligations for each of the
fivefiscal years subsequent to
June 30, 2018,and thereafter are as follows (in thousands):
The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.
Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef