9. LINE OF CREDIT

During the fiscal year ended June 30, 2016, the Company entered into a Loan and Security Agreement and other ancillary documents (as amended, the “Heritage Loan Documents”) with Heritage Bank of Commerce (“Heritage Bank”), providing for a secured asset-based revolving line of credit in an amount of up to $12.0 million (the “Heritage Line of Credit”) at an interest rate calculated based on the Federal Reserves’ Prime, which was 4.25% at June 30, 2017, plus 2.25%. The Heritage Line of Credit and the Company’s obligations under the Heritage Loan Documents are secured by substantially all of the Company’s assets, including its intellectual property.

During March 2017, the Company entered into the third amendment with Heritage Bank that extended the maturity date of the Heritage Line of Credit from March 29, 2017 to September 30, 2018. The Company paid a total of $90 thousand in deferred financing costs.

At the time of maturity, all outstanding advances under the Heritage Line of Credit as well as any unpaid interest are due and payable. Prior to maturity of the Heritage Line of Credit, the Company may prepay amounts due under the Heritage Line of Credit without penalty, and subject to the terms of the Heritage Loan Documents, may re-borrow any such amounts. The Heritage Loan Documents contain customary representations and warranties and affirmative and negative covenants applicable to the Company.

The balance due on the Heritage Line of Credit was $7.1 million at June 30, 2017 and $7.2 million at June 30, 2016. Included in the Heritage Line of Credit balance is $75 thousand of unamortized debt issuance costs, which is reflected in our net liability of $7.0 million for year ending June 30, 2017. As of June 30, 2017, $4.9 million was available under our line of credit.


	For Year ended
	June 30,
($ in thousands)	2017			2016

Principal balance at period-end	$	7,111		$	7,217
Unamortized discount		(75)			(98)
Line of credit, net	$	7,036		$	7,119
Maximum amount outstanding at any month end	$	7,395		$	7,217
Average balance outstanding during the period	$	7,177		$	4,959
Weighted-average interest rate:
As of the period-end		6.5	%		5.8	%
Paid during the period		6.0	%		5.5	%

Interest expense on the Line of Credit was approximately $434 thousand, $260 thousand and $211 thousand during each of the years ended June 30, 2017, 2016 and 2015 respectively.