XML 84 R13.htm IDEA: XBRL DOCUMENT v2.4.0.6
Credit Arrangements
12 Months Ended
Jun. 30, 2012
Line of Credit Facility [Line Items]  
Schedule of Line of Credit Facilities [Table Text Block]
CREDIT ARRANGEMENTS
2011 Credit Agreement
On June 30, 2011, we entered into an unsecured senior credit facility (the “2011 Credit Agreement”) providing for a five-year term loan of $100.0 million and a revolving credit facility in the principal amount of up to $300.0 million. The borrowings all carry a variable interest rate based on LIBOR, prime, or a similar index, plus a margin (margin not to exceed a per annum rate of 1.75%).
We agreed to pay a commitment fee on the revolving loan commitment calculated as a percentage of the unused amount of the revolving loan commitments at a per annum rate of up to 0.40%. We also paid various customary fees to secure this arrangement, which are being amortized using the effective interest method over the life of the debt.
In September 2011, we entered into an interest rate swap and an interest rate cap agreement. These interest rate hedges were deemed to be fully effective in accordance with ASC 815 and, as such, unrealized gains and losses related to these derivatives are recorded as other comprehensive income. Principal in the amount of $100.0 million under the 2011 Credit Agreement has been hedged with an interest rate swap agreement and carries a fixed interest rate of 1.30% plus an applicable margin. Principal in the amount of $50.0 million has been hedged with an interest rate cap arrangement with an interest rate cap of 2.00% plus an applicable margin.
As of June 30, 2012, we had $125.0 million of principal borrowed under the revolving credit facility, $95.0 million of principal borrowed under the term loan, and borrowing availability of $175.0 million under the revolving credit facility. Our debt under the 2011 Credit Agreement, including the $100.0 million of principal hedged with an interest swap agreement, carried an average annualized interest rate of 1.90%.
During the twelve months ended June 30, 2012, we made principal payments of $5.0 million on the term loan. The remaining term loan scheduled repayments under the 2011 Credit Agreement increase over time: $5.0 million in Fiscal Year 2013, $10.0 million in Fiscal Year 2014, $20.0 million in Fiscal Year 2015, and $60.0 million in Fiscal Year 2016.
The 2011 Credit Agreement contains negative covenants applicable to us and our subsidiaries, including financial covenants requiring us to comply with maximum leverage ratios and minimum interest coverage ratios, as well as restrictions on liens, investments, indebtedness, fundamental changes, acquisitions, dispositions of property, making specified restricted payments (including stock repurchases exceeding an agreed to percentage of consolidated net income), and transactions with affiliates. As of June 30, 2012, we were in compliance with all covenants under the 2011 Credit Agreement.
2010 Credit Facility
In September 2010, we entered into three short-term credit facilities for an aggregate of $75.0 million (the “2010 Credit Facility”). In December 2010, we amended the 2010 Credit Facility to extend the expiration date to June 30, 2011. These amounts were fully repaid with the proceeds from the 2011 Credit Agreement.
2008 Credit Facility
In June 2008, we entered into an agreement for a credit facility (the “2008 Credit Facility”) in the principal amount of up to $315.0 million. The 2008 Credit Facility consisted of a $150.0 million unsecured term loan facility and an unsecured revolving credit facility up to $165.0 million.
As of June 30, 2011, all outstanding amounts under the 2008 Credit Facility were fully repaid with the proceeds from the 2011 Credit Agreement. In conjunction with this refinancing, we recognized $1.1 million of accelerated financing fees.
Additional Lines of Credit
We have an unsecured line of credit with JP Morgan UK in the amount of $4.5 million that bears interest at an annual rate ranging between 2.00% and 4.00%. We entered into this line of credit to facilitate business transactions. At June 30, 2012, we had $4.5 million available under this line of credit.
We have a cash pool facility with RBS Nederland, NV in the amount of 5.0 million Euros that bears interest at an annual rate ranging between 2.00% and 4.00%. We entered into this line of credit to facilitate business transactions. At June 30, 2012, we had 5.0 million Euros available under this line of credit.
We have a cash pooling arrangement with RBS Nederland, NV. Pooling occurs when debit balances are offset against credit balances and the overall net position is used as a basis by the bank for calculating the overall pool interest amount. Each legal entity owned by us and party to this arrangement remains the owner of either a credit (deposit) or a debit (overdraft) balance. Therefore, interest income is earned by legal entities with credit balances, while interest expense is charged to legal entities with debit balances. Based on the pool’s aggregate balance, the bank then (1) recalculates the overall interest to be charged or earned, (2) compares this amount with the sum of previously charged/earned interest amounts per account and (3) additionally pays/charges the difference. The gross overdraft balance related to this pooling arrangement was $63.4 million and $50.2 million at June 30, 2012 and June 30, 2011, respectively, and was included in cash and cash equivalents.