Credit Facilities

3 Months Ended

Sep. 30, 2011

Credit Facilities [Abstract]

Credit Facilities

9.         Credit Facilities 

The Company had no debt outstanding at September 30, 2011.

The Company has a $6.0 million secured Credit Agreement which expires on November 1, 2012.  Proceeds under the Credit Agreement may be used for working capital and capital expenditures.  Security under the Credit Agreement is substantially all non-real estate assets of the Company held in the United States.  Borrowings are designated as a Libor-based Advance or as a Prime-based Advance if the Libor-based Advance is not available.  Interest on Libor-based Advances is calculated currently at 2.35% above the Libor Rate offered at the time for the period chosen, and is payable on the last day of the applicable period.  The Company may not select a Prime-based rate for Advances except during a period of time during which the Libor-based rate is not available as the applicable interest rate.  Interest on Prime-based Advances is payable on the first business day of each month commencing on the first business day following the month during which such Advance is made and at maturity and is calculated daily, using the interest rate established by Comerica Bank as its prime rate for its borrowers.  Quarterly, the Company pays a commitment fee of 0.15% per annum on the average daily unused portion of the revolving credit commitment.  The Credit Agreement prohibits the Company from paying dividends but permits the Company to repurchase up to $5.0 million of its common stock through December 31, 2011.  In addition, the Credit Agreement requires the Company to maintain a minimum Tangible Net Worth, as defined in the Credit Agreement, minus the aggregate amount paid by the Company to redeem its shares of its common stock during the period beginning October 18, 2010 and ending December 31, 2011.  The Credit Agreement also requires the Company to have no advances outstanding for 30 days each calendar year.  At September 30, 2011, the Credit Agreement required a Tangible Net Worth of not less than $31.6 million and supported outstanding letters of credit totaling $311,000.

At September 30, 2011, the Company's German subsidiary (GmbH) had an unsecured credit facility totaling 300,000 euros (equivalent to approximately $408,000). The facility may be used to finance working capital needs and equipment purchases or capital leases. Any borrowings for working capital needs will bear interest at 9.0% on the first 100,000 euros of borrowings and 2.0% for borrowings over 100,000 euros. The German credit facility is cancelable at any time by either GmbH or the bank and any amounts then outstanding would become immediately due and payable. At September 30, 2011, GmbH had no borrowings outstanding.