Note 13 - Debt

12 Months Ended

Jun. 30, 2013

Debt Disclosure [Abstract]

Debt Disclosure [Text Block]

13. DEBT

Debt, including capitalized lease obligations, is comprised of the following (in thousands):

	June 30, 2013		June 30, 2012
Short-term and current maturities
Loan and Security Agreement	$	1,348	$	1,289
Short-term foreign credit facility		27		231
Capitalized leases		182		280
	$	1,557	$	1,800
Long-term debt
Loan and Security Agreement	$	24,037	$	28,985
Capitalized leases		215		402
		24,252		29,387
Total	$	25,809	$	31,187

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

Fiscal Year
2014	$	1,557
2015		13,448
2016		1,552
2017		1,543
2018		1,614
Thereafter		6,095
Total	$	25,809

The Company completed the negotiations for an amended Loan and Security Agreement (“Line of Credit”) and executed the new agreement as of April 25, 2012.  Borrowings under this agreement may not exceed $23 million.  The Line of Credit expires on April 30, 2015 and has an interest rate of LIBOR plus 1.5%.  The effective interest rate on the Line of Credit for fiscal 2013 was 1.95%.

On September 7, 2012, the Company completed an amendment to the financial covenants.  The material financial covenants of the amended Loan and Security Agreement are: 1) funded debt to EBITDA, excluding non-cash and retirement benefit expenses (“maximum leverage”), cannot exceed 1.45 to 1; 2) annual capital expenditures cannot exceed $15.0 million; 3) maintain a Debt Service Coverage Rate of a minimum of 1.25 to 1 and 4) maintain consolidated cash plus liquid investments of not less than $10.0 million at any time.

On May 9, 2013, the Company further amended the agreement to adjust the current funded debt to EBITDA ratio from 1.45 to 1, to 2.25 to 1 for the fourth quarter of fiscal 2013 and the first quarter of fiscal 2014. Thereafter, and through the end of the agreement on April 30, 2015, the funded debt to EBITDA covenant reverts to 1.45 to 1. The Company expects to be able to meet this covenant in future periods.

On November 22, 2011, in conjunction with the Bytewise acquisition, the Company entered into a new $15.5 million term loan (the “Term Loan”) under the then existing Loan and Security Agreement.  The term loan is a ten year loan bearing a fixed interest rate of 4.5% and is payable in fixed monthly payments of principal and interest of $160,640.  The $15.5 million term loan is subject to the same financial covenants as the Loan and Security Agreement.

Availability under the Line of Credit is 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 in excess of $23.0 million.  As of June 30, 2013, the Company had borrowings of $11.9 million under this facility. A 0.25% commitment fee is charged on the unused portion of the Line of Credit.

The Company has three standby letters of credit totaling $0.6 million which reduce the $23 million available Line of Credit to $22.4 million.  As of June 30, 2013, the Company has approximately $10.5 million available in the Line of Credit.

The obligations under the Credit Facility are unsecured. In the event of certain triggering events, such obligations would become secured by the assets of the Company’s domestic subsidiaries. A triggering event occurs when the Company fails to achieve any of the financial covenants noted above in consecutive quarters.