Note F - Debt Facilities

3 Months Ended

Jul. 31, 2017

Notes to Financial Statements

Debt Disclosure [Text Block]

F – Debt Facilities

A summary of revolving credit facilities is as follows:

(In thousands)
	Aggregate		Interest				Balance at
	Amount		Rate		Maturity		July 31, 2017		April 30, 2017
Revolving credit facilities	$	200,000		LIBOR + 2.375%		December 12, 2019	$	117,822	$	118,124
				(3.61% at July 31, 2017 and 3.37% at April 30, 2017)

On

December 12, 2016,

the Company entered into a Second Amended and Restated Loan and Security Agreement which amended and restated the Company’s Credit Facilities. The new agreement extended the terms of the Credit Facilities to

December 12, 2019,

reduced the pricing tiers for determining the applicable interest rate from

four

to three, and reset the aggregate limit on the repurchase of Company stock to

$40

million beginning

December 12, 2016.

The agreement also increased the total revolving credit facilities from

$172.5

million to

$200

million, provided the option to request revolver commitment increases for up to an additional

$50

million and increased the advance rate on accounts receivable with

37

-

42

month terms from

50%

to

55%,

and the advance rate on accounts receivable with

43

-

60

month terms from

45%

to

50%.

The revolving credit facilities are collateralized primarily by finance receivables and inventory, are cross collateralized and contain a guarantee by the Company. Interest is payable monthly under the revolving credit facilities. The Credit Facilities provide for

three

pricing tiers for determining the applicable interest rate, based on the Company’s consolidated leverage ratio for the preceding fiscal quarter. The current applicable interest rate under the Credit Facilities is generally LIBOR plus

2.375%.

The Credit Facilities contain various reporting and performance covenants including (i) maintenance of certain financial ratios and tests, (ii) limitations on borrowings from other sources, (iii) restrictions on certain operating activities and (iv) restrictions on the payment of dividends or distributions.

The distribution limitations under the Credit Facilities allow the Company to repurchase the Company’s stock so long as: either (a) the aggregate amount of such repurchases does

not

exceed

$40

million beginning

December 12, 2016

and the sum of borrowing bases combined minus the principal balances of all revolver loans after giving effect to such repurchases is equal to or greater than

25%

of the sum of the borrowing bases, or (b) the aggregate amount of such repurchases does

not

exceed

75%

of the consolidated net income of the Company measured on a trailing

twelve

month basis; provided that immediately before and after giving effect to the stock repurchases at least

12.5%

of the aggregate funds committed under the credit facilities remain available.

The Company was in compliance with the covenants at

July 31, 2017.

The amount available to be drawn under the credit facilities is a function of eligible finance receivables and inventory; based upon eligible finance receivables and inventory at

July 31, 2017,

the Company had additional availability of approximately

$79

million under the revolving credit facilities.

The Company recognized approximately

$59,000

and

$70,000

of amortization for the

three

months ended

July 31, 2017

and

2016,

respectively, related to debt issuance costs. The amortization is reflected as interest expense in the Company’s Condensed Consolidated Statements of Operations.

During fiscal

2017,

the Company incurred approximately

$449,000

in debt issuance costs related to the Second Amended and Restated Loan and Security Agreement and incurred additional debt issuance costs of approximately

$28,000

during the

first

quarter of fiscal

2018.

Debt issuance costs of approximately

$561,000

and

$593,000

as of

July 31, 2017

and

April 30, 2017,

respectively, are shown as a deduction from the revolving credit facilities in the Condensed Consolidated Balance Sheet.

On

December 15, 2015,

the Company entered into an agreement to purchase the property on which

one

of its dealerships is located for a purchase price of

$550,000.

Under the agreement, the purchase price is being paid in monthly principal and interest installments of

$10,005.

The debt matures in

December 2020,

bears interest at a rate of

3.50%

and is secured by the property. The balance on this note payable was approximately

$386,000

and

$413,000

as of

July 31, 2017

and

April 30, 2017,

respectively.