Note 6 - Borrowings |
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| Notes to Financial Statements | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt Disclosure [Text Block] |
Total debt obligations at December 31, 2017 and June 30, 2017 consist of the following (in thousands):
The Company entered into a five year, $150 million senior secured revolving credit and term loan facility on October 21, 2014, as amended (the “Facility”). The Facility, which expires on October 21, 2019, provided a single-draw term loan of $35 million and a revolving credit line of up to
$115 million, subject to borrowing base availability. We incurred financing costs of $1.5 million under the Facility. The unamortized portion is being amortized 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
1.5% to 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 0.5% to 0.75%. During the quarter ended September 30, 2017, the remaining balance due on the term loan was repaid. The interest on the term loan under the Facility had been based on the Company’s rent adjusted leverage ratio with an annual rate of LIBOR plus
1.75% to 2.25%. The Company pays a commitment fee of 0.15% to 0.25% per annum on the unused portion of the Facility, and fees on issued letters of credit at an annual rate of 1.5% to 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.The Fa cility 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
may limit 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 1.1 to 1.0 at all times unless the outstanding term loans are less than $17.5 million and the fixed charge coverage ratio equals or exceeds 1.2
5 to 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.The Company intends to use the Facility for working capital and general corporate purposes, including dividend payments and share repurchases. At December 31, 2017 and June 30, 2017, there was $0.2 million and $0.1 million, respectively, of standby letters of credit outstanding under the Facility. Total availability under the Facility was $114.8 million at December 31, 2017 and $114.9 million at June 30, 2017.
At both December 31, 2017 and June 30, 2017, we were in compliance with all the covenants under the Facility.
The following table summarizes, as of December 31, 2017, the timing of cash payments related to our outstanding long-term debt obligations for the remaining
six months of fiscal 2018, and each of the five fiscal years subsequent to June 30, 2018, and thereafter (in thousands).
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