Note 7: Debt

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

	12/31/2015		6/30/2015
Notes payable and current maturities of long term debt
Loan and Security Agreement	$	1,507	$	1,474
Capitalized leases		9		78
		1,516		1,552
Long-term debt
Loan and Security Agreement		17,889		18,552
	$	19,405	$	20,104

The Company amended its Loan and Security Agreement, which includes a Line of Credit and a Term Loan, in January 2015 with changes that took effect on April 25, 2015. Borrowings under the Line of Credit may not exceed $23.0 million. The agreement expires on April 30, 2018 and has an interest rate of LIBOR plus 1.5%. As of December 31, 2015, $9.4 million was outstanding on the Line of Credit.

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”), not to exceed 2.25 to 1.2) annual capital expenditures not to 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. The Company was in compliance with all debt covenants as of December 31, 2015.

On November 22, 2011, in conjunction with the Bytewise acquisition, the Company entered into a $15.5 million term loan (the “Term Loan”) under the existing Loan and Security Agreement with TD Bank N.A. 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 Term Loan, which had a balance of $10.0 million at December 31, 2015, is subject to the same financial covenants as the Loan and Security Agreement.

The effective interest rate on the Line of Credit under the Loan and Security Agreement for the six months ended December 31, 2015 and 2014 was 2.1% and 2.0%, respectively.