Note 7 - Revolving Line of Credit and Long-term Debt

12 Months Ended

Jun. 30, 2020

Notes to Financial Statements

Debt Disclosure [Text Block]

NOTE

7

— REVOLVING LINE

OF CREDIT AND LONG-TERM DEBT

In

February 2019,

the Company amended its secured line of credit to a

$75

million facility from a

$100

million facility in order to better match its financing needs with an appropriate borrowing capacity. The line of credit expires in the

third

quarter of fiscal

2022.

Interest on the revolving line of credit is charged based upon an increment over the LIBOR rate as periodically determined, or at the bank's base lending rate, at the Company's option. The increment over the LIBOR borrowing rate, as periodically determined, fluctuates between

125

and

250

basis points depending upon the ratio of indebtedness to earnings before interest, taxes, depreciation and amortization (“EBITDA”), as defined in the line of credit agreement. The increment over LIBOR borrowing rate will be

125

basis points for the

first

quarter of fiscal

2021.

The fee on the unused balance of the

$75

million committed line of credit is

20

basis points. Under the terms of this line of credit, the Company has agreed to a negative pledge of real estate assets and is required to comply with financial covenants that limit the ratio of indebtedness to EBITDA and require a minimum fixed charge coverage ratio. As of

June 30, 2020,

there were

no

borrowings against the line of credit, and

$75.0

million was available as of that date. Based on the terms of the line of credit and the maturity date, the debt has been classified as long term.

The Company is in compliance with all of its loan covenants as of

June 30, 2020.