DEBT

12 Months Ended

Jun. 30, 2021

Debt is comprised of the following (in thousands):


	6/30/2021		6/30/2020
Short-term and current maturities
Loan and Security Agreement (Line of Credit)	$	9,153	$	—
Loan and Security Agreement (Term Loan)	1,509		597
Brazil Loans	5,297		3,935
	15,959		4,532
Long-term debt (net of current portion)

Loan and Security Agreement (Term Loan)	6,010		5,941
Loan and Security Agreement (Line of Credit)	—		20,400
	6,010		26,341
	$	21,969	$	30,873

Future maturities of debt are as follows (in thousands):


Fiscal Year
2022	$	15.959
2023	1.560
2024	1.617
2025	1.677
2026	1.156
Thereafter	—
Total	$	21.969

As a result of a decrease in sales related to the COVID-19 pandemic, the Company anticipated potential non-compliance with its fixed charge coverage ratio for the year ended June 30, 2021 under its Loan and Security Agreement (the “Loan Agreement”) by and among the Company and its U.S. operating companies (collectively, the “Borrowers”) and TD Bank, N.A. (“TD Bank”). On June 25, 2020, the Borrowers and TD Bank entered into an amendment and restatement (the “Amendment and Restatement”) of the Loan Agreement. The Amendment and Restatement waived the fixed charge coverage ratio for the quarter ended June 30, 2021. In addition, the Amendment and Restatement clarifies that certain non-cash adjustments to the definition of EBITDA are permitted under the Loan Agreement, as amended. In addition, the Amendment and Restatement

increases the permitted borrowings from a foreign bank from $5.0 million to $15.0 million and permits the Company to draw the remainder of the outstanding balance under the Loan Agreement.

Pursuant to the terms of the Company’s Amended and Restated Loan and Security Agreement of June 25, 2020, the “First Amendment” to this loan agreement was executed on September 17, 2020, which include, among other things, (i) pause testing of the Fixed Charge Coverage Ratio until September 30, 2021 and (ii) establishment of a new minimum cumulative EBITDA and minimum liquidity covenants in lieu thereof. TD Bank perfected its security interests in the Company’s U.S. based assets, increased the maximum interest charged on the Line of Credit from and annual interest rate of 2.25% plus LIBOR to 3.50% plus LIBOR, and amended the borrowing base for the line of credit from 80% of Qualified AR and 50% of the lower of Cost or Market of US inventory values to 80% of qualified AR plus 85% of the Net Orderly Liquidation Value (NOLV) of US Inventory plus 62.5% of total appraised US real estate values. As a result of this change, the Company is projected to maintain its current borrowing capacity of $25,000,000 under the Line of Credit. The Company underwent a series of appraisals and field exams in all US locations as part of restructuring this agreement. In addition, the Company will provide additional reporting to TD Bank, including monthly profit and loss statements, balance sheets, cash flow statements and forecasting. This minimum adjusted EBITDA covenant is based on the Company’s plan for a slow pandemic recovery throughout FY21 and the impact of the Company’s restructuring plan initiatives. The Company will apply certain proceeds from the sale of US real estate assets against the principle balance of the term loans under the TD Bank loan agreement. The Agreement will revert to the existing covenant package for the quarter ending September 30, 2021 and every quarter thereafter.

On December 31, 2019, the Company entered into the Tenth Amendment of its Loan and Security Agreement (“Tenth Amendment”). Under the revised agreement, the credit limit for the Revolving Loan was increased from $23.0 million to $25.0 million. In addition, the Company entered into a new $10.0 million 5 years Term Loan with a fixed interest rate of 4.0%. The new Term Loan will require interest only payments for 12 months and will convert to a term loan requiring both interest and principle payments commencing January 1, 2021. Under the Tenth Amendment, the credit limit for external borrowing was increased from $2.5 million to $5.0 million.

In fiscal 2020 the Company paid-off $3.5 million of the Bytewise term loan (November 2011) using the proceeds from borrowing $6.5 million on the Loan and Security Agreement Term Loan.

Availability under the Line of Credit remains subject to a borrowing base comprised of accounts receivable and inventory. The Company believes that the borrowing base will consistently produce availability under the Line of Credit of $25.0 million. A 0.25% commitment fee is charged on the unused portion of the Line of Credit.

The Company’s Brazilian subsidiary loans are backed by the entity’s US dollar denominated export receivables were made with Brazilian Banks. As of June 30, 2021 the following table represents Brazil's outstanding debt (in thousands):


Lending Institution	Interest Rate		Beginning Date	Ending Date	Outstanding Balance
Brasil	4.30	%	September 2020	August 2021	$	119
Brasil	3.38	%	November 2020	November 2021	719
Bradesco	2.37	%	December 2020	December 2021	1,000
Bradesco	4.74	%	December 2020	December 2021	600
Santanter	5.98	%	February 2021	February 2022	1,500
Brasil	2.80	%	May 2021	May 2022	1,359
					$	5,297