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Debt and Floor Plan Payable
9 Months Ended
Dec. 28, 2019
Debt Disclosure [Abstract]  
Debt and Floor Plan Payable

8.

Debt and Floor Plan Payable

Long-term debt consisted of the following:

 

(Dollars in thousands)

 

December 28, 2019

 

 

March 30, 2019

 

Revolving credit facility maturing in 2023

 

$

26,900

 

 

$

41,900

 

Obligations under industrial revenue bonds due 2029

 

 

12,430

 

 

 

12,430

 

Total debt

 

 

39,330

 

 

 

54,330

 

Less: current portion

 

 

 

 

 

 

Total long-term debt

 

$

39,330

 

 

$

54,330

 

 

On June 5, 2018, the Company entered into a credit agreement (the “Credit Agreement”) with a syndicate of banks. The Credit Agreement provides for a revolving credit facility of up to $100.0 million, including a letter of credit sub-facility of not less than $45.0 million. Initial borrowings under the Credit Agreement were used to repay the Company’s existing $46.9 million term loans (“Term Loans”) and replace the Company’s existing cash collateralized stand-alone letter of credit facility. The revolving credit facility allows the Company to draw down, repay and re-draw loans on the available funds during the term of the Credit Agreement. During the three and nine months ended December 28, 2019, the Company repaid $5.0 million and $15.0 million, respectively, of amounts previously drawn on the revolving credit facility.

The Credit Agreement matures on June 5, 2023 and has no scheduled amortization. The interest rate on borrowings under the Credit Agreement adjusts based on the first lien net leverage of the Company from a high of LIBOR plus 2.25% and ABR plus 1.25% when the first lien net leverage is equal to or greater than 2.00:1.00, to a low of LIBOR plus 1.50% and ABR plus 0.50% when the first lien net leverage is below 0.50:1.00. In addition, the Company is obligated to pay an unused line fee ranging between 0.40% and 0.25% (depending on the first lien net leverage) in respect of unused commitments under the Credit Agreement. At December 28, 2019 the interest rate on borrowings under the Credit Agreement was 3.2%. At December 28, 2019, letters of credit issued under the Credit Agreement totaled $28.7 million. Total available borrowings under the Credit Agreement as of December 28, 2019 were $44.4 million.

Obligations under industrial revenue bonds are supported by letters of credit and bear interest based on a municipal bond index rate. The weighted-average interest rate at December 28, 2019, including related costs and fees, was 3.78%. At March 30, 2019, the weighted average interest rate was 3.62%. The industrial revenue bonds require lump-sum payments of principal upon maturity in 2029.

 

The Credit Agreement contains covenants that restrict the amount of additional debt, liens and certain payments, including equity buybacks, investments, dispositions, mergers and consolidations, among other restrictions as defined. The Company was in compliance with all covenants of the Credit Agreement as of December 28, 2019.

Floor Plan Payable

The Company’s retail operations utilize floor plan financing to fund the purchase of manufactured homes for display or resale. At December 28, 2019 and March 30, 2019, the Company had outstanding borrowings on floor plan financing agreements of $32.4 million and $33.3 million, respectively. Total credit line capacity provided under the agreements was $48.0 million as of December 28, 2019. Borrowings are secured by the homes and are required to be repaid when the Company sells the home to a customer.