Note 3. Debt

The Company has a $10,000,000 line of credit agreement with Community Bank, N.A . Borrowings under this agreement bear interest at either the 30, 60, or 90 day London Inter-Bank Offered Rate (“LIBOR”) (0.33 % and 0.31 % for the 90 day LIBOR at November 30, 2015 and August 31, 2015, respectively ) plus 1.75% and/or the bank’s reference rate (3.25% at November 30, 2015 and August 31, 2015). Borrowings are secured by substantially all assets of Bisco and are guaranteed by the Company’s Chief Executive Officer, Chairman of the Board and majority shareholder, Glen F. Ceiley. The agreement expires on March 1, 2017 .

The amounts outstanding under this line of credit as of November 30, 2015 and August 31, 2015 were $961,000 and zero, respectively. Availability under the line of credit was $9,039,000 and $10,000,000 at November 30, 2015 and August 31, 2015, respectively.

The line of credit agreement contains nonfinancial and financial covenants, including the maintenance of certain financial ratios. As of November 30, 2015 and August 31, 2015, the Company was in compliance with all fin ancial covenants.