Note 4 - Debt

3 Months Ended

Dec. 31, 2016

Notes to Financial Statements

Debt and Capital Leases Disclosures [Text Block]

4

.

Debt

Credit Facility

The Company is party to a credit facility (the Credit Facility) pursuant to which the amount available for borrowing is

$45.0

million, including a

$5.0

million sublimit for standby letters of credit. The operating company is the borrower under the Credit Facility and its obligations under the Credit Facility are guaranteed by the holding company and

VC2.

The Credit Facility is secured by a lien on substantially all of the Company’s assets. The Company has the ability to increase the amount available for borrowing under the Credit Facility by an additional amount that

may

not exceed

$5.0

million if the existing lenders or other eligible lenders agree to provide an additional commitment or commitments. The Company has the right to borrow, prepay and re-borrow amounts under the Credit Facility at any time prior to the maturity date. The Credit Facility matures on

January

31,

2021.

For floating rate borrowings under the Credit Facility, interest is determined by the lender’s administrative agent based on the most recent compliance certificate of the operating company and stated at the base rate less the lender spread based upon certain financial measures. For fixed rate borrowings under the Credit Facility, interest is determined by quoted LIBOR rates for the interest period plus the lender spread based upon certain financial measures. The unused commitment fee is based upon certain financial measures.

The Credit Facility requires compliance with certain customary operational and financial covenants, including a leverage ratio. The Credit Facility also contains certain other customary limitations on the Company’s ability to incur additional debt, guarantee other obligations, grant liens on assets and make investments or acquisitions, among other limitations. Additionally, the Credit Facility prohibits the payment of cash dividends, except that so long as no default exists or would arise as a result thereof, the operating company

may

pay cash dividends to the holding company for various audit, accounting, tax, securities, indemnification, reimbursement, insurance and other reasonable expenses incurred in the ordinary course of business, and for repurchases of shares of common stock in an amount not to exceed

$10.0

million.

The Company had

$27.1

million and

$27.4

million outstanding under the Credit Facility as of

December

31,

2016

and

September

30,

2016,

respectively. As of each of

December

31,

2016

and

September

30,

2016,

the Company had undrawn, issued and outstanding letters of credit of

$1.0

million, which were reserved against the amount available for borrowing under the terms of the Credit Facility. The Company had

$16.9

million and

$16.6

million available for borrowing under the Credit Facility as of

December

31,

2016

and

September

30,

2016,

respectively.

Capital and Financing Lease Obligations

The Company had

16

leases as of each of

December

31,

2016

and

September

30,

2016

that are included in capital and financing lease obligations (see Note

6).

The Company does not record rent expense for these capitalized real estate leases; rather, rental payments under the capital leases are recognized as a reduction of the capital and financing lease obligation and as interest expense. The interest rate on capital and financing lease obligations is determined at the inception of the lease.

Interest

The Company incurred gross interest expense of approximately

$1.1

million and

$0.8

million for the

three

months ended

December

31,

2016

and

2015,

respectively. Interest expense for the

three

months ended

December

31,

2016

and

2015

relates primarily to interest on capital and financing lease obligations. The Company capitalized interest of

$0.1

million and

$0.2

million for the

three

months ended

December

31,

2016

and

2015,

respectively.