Long-Term Debt and Revolving Credit Facility

12 Months Ended

Jun. 30, 2021

Debt Disclosure [Abstract]

Long-Term Debt and Revolving Credit Facility

Long-Term Debt and Revolving Credit Facility

Short-term borrowings and long-term debt consisted of the following obligations:

(Amounts in Thousands)	June 30, 2021		June 30, 2020
Long-term debt under revolving credit facility due October 2024; 1.38% variable interest rate at June 30, 2021	$	40,000	$	—
Other debt maturing August 12, 2025; 9.25% fixed interest rate	109		136
Total Debt	$	40,109	$	136

Aggregate maturities of long-term debt for the next four years through maturity are, in thousands, $30, $33, $36, and $40,010, respectively.

As of June 30, 2021 we had a $125.0 million revolving credit facility with a maturity date of October 2024 that allowed for both issuances of letters of credit and cash borrowings. We also have an option to request an increase of the amount available for borrowing to $200.0 million, subject to participating banks’ consent. The revolving loans under the Credit Agreement could consist of, at our election, advances in U.S. dollars or advances in any other currency that was agreed to by the lenders. The proceeds of the loans are to be used for general corporate purposes including acquisitions. A portion of the revolving credit facility, not to exceed $10 million of the principal amount, was available for the issuance of letters of credit. At June 30, 2021, we had $1.7 million in letters of credit outstanding, which reduced our borrowing capacity on the revolving credit facility. Total availability to borrow under the revolving credit facility totaled $83.3 million at June 30, 2021. The commitment fee on the unused portion of principal amount of the revolving credit facility is payable at a rate that ranges from 20 to 30 basis points per annum as determined by our ratio of consolidated total indebtedness to adjusted consolidated EBITDA. The weighted average interest rate on borrowings outstanding at June 30, 2021 and June 30, 2020 was 1.40% and 9.25%, respectively. Interest expense incurred and paid on borrowings were, in thousands, $382, $15, and $87, in fiscal years 2021, 2020, and 2019, respectively.

The interest rate is dependent on the type of borrowings and will be one of the following two options:

•the adjusted London Interbank Offered Rate (“Adjusted LIBO Rate” as defined in the Credit Agreement) in effect two business days prior to the advance (adjusted upwards to reflect bank reserve costs) for such interest period, plus the Eurocurrency Loans margin which can range from 125.0 to 200.0 basis points based on the Company's ratio of consolidated total indebtedness to adjusted consolidated EBITDA; or

•the Alternate Base Rate (the “ABR”) which is defined as the highest of the fluctuating rate per annum equal to the higher of

a.prime rate as last quoted by The Wall Street Journal; or

b.1% per annum above the Adjusted LIBO rate; or

c.0.5% per annum above the Federal Reserve Bank of New York;

plus the ABR Loans spread which can range from 25.0 to 100.0 basis points based on the Company's ratio of consolidated total indebtedness to adjusted consolidated EBITDA.

We were in compliance with all debt covenants of the revolving credit facility during the twelve-month period ended June 30, 2021. The most significant financial covenants under the Credit Agreement require:

•an adjusted leverage ratio of (a) consolidated total indebtedness minus unencumbered U.S. cash equivalents in excess of $15,000,000 provided that the maximum subtraction shall not exceed $35,000,000 to (b) adjusted consolidated EBITDA,

determined as of the end of each of its fiscal quarters for the then most recently ended four fiscal quarters, to not be greater than 3.00 to 1.00, and

•an interest coverage ratio, for any period, of (a) Consolidated EBITDA for such period to (b) cash interest expense for such period, calculated on a consolidated basis in accordance with GAAP for the trailing four quarter period then ending, to not be less than 3.00 to 1.00.

Subsequent to June 30, 2021, we entered into an interest rate swap agreement with a bank with a notional value of $40 million. The interest rate swap became effective in July 2021 and will be accounted for using hedge accounting.

During fiscal year 2021, we acquired Poppin, Inc. subsequent to their borrowing of the Payment Protection Program (“PPP”) loan. During the fourth quarter of fiscal year 2021 we were notified that Poppin’s PPP loan had been forgiven in full and the proceeds were paid in the first quarter of fiscal year 2022 to the former Poppin, Inc. equity holders per the terms of the agreement and plan of merger.