v3.22.2.2
DEBT
 6 Months Ended
Aug. 31, 2022
Debt Disclosure [Abstract]  
Debt Disclosure [Text Block]

Note 4 – DEBT

 

Debt consists of the following:

 

   

August 31, 2022

    

February 28, 2022

  
                 

Line of credit

   $ 12,060,900     $ 17,723,500  
                 

Floating rate term loan(s) (1)

   $ 21,000,000     $ 14,651,000  

Fixed rate term loan

     15,000,000       10,349,100  

Total long-term debt

     36,000,000       25,000,100  
                 

Less current maturities

     (1,800,000

)

     (2,542,200

)

Less debt issue cost

     (224,200

)

     (48,400

)

Long-term debt, net

   $ 33,975,800     $ 22,409,500  
                 

(1) The February 28, 2022 floating rate term loans balance of $14,651,000 was comprised of the MidFirst Bank advancing term loans #1 and #2.

  

 

On August 9, 2022, the Company repaid in full all outstanding indebtedness and terminated all commitments and obligations under its Amended and Restated Loan Agreement dated February 15, 2021 (as amended), between the Company and MidFirst Bank. The Company’s payment to MidFirst Bank, including interest, was $45,028,600, which satisfied all of the Company’s debt obligations with MidFirst Bank. The Company did not incur any early termination penalties as a result of the repayment of indebtedness or termination of the Amended and Restated Loan Agreement, which provided Term Loan #1, Advancing Term Loan #1, Advancing Term Loan #2 and the Revolving Loan. In connection with the repayment of outstanding indebtedness, the Company was automatically and permanently released from all security interests, mortgages, liens and encumbrances under the Amended and Restated Loan Agreement with MidFirst Bank. The material terms of the Amended and Restated Loan Agreement with MidFirst Bank are described in the Company’s Form 10-K filed with the Securities and Exchange Commission (“SEC”) on May 5, 2022.

 

On August 9, 2022, the Company executed a new Credit Agreement (“Loan Agreement”) with BOKF, NA (“Bank of Oklahoma” or the “Lender”). The Loan Agreement establishes a fixed rate term loan in the principal amount of $15,000,000 (the “Fixed Rate Term Loan”), a floating rate term loan in the principal amount of $21,000,000 (the “Floating Rate Term Loan”; together with the Fixed Rate Term Loan, collectively, the “Term Loans”), and a revolving promissory note in the principal amount up to $15,000,000 (the “Revolving Loan” or “Line of Credit”).

 

Features of the Loan Agreement include:

 

 

(i)

Term Loans on 20-year amortization with 5-year maturity date of August 9, 2027
 

(ii)

Revolving Loan maturity date of August 9, 2023
 

(iii)

Fixed Rate Term Loan bears interest at a fixed rate per annum equal to 4.26%
 

(iv)

Floating Rate Term Loan bears interest at a rate per annum equal to Term SOFR Rate + 1.75% (effective rate was 4.03% at August 31, 2022)
 

(v)

Revolving Loan bears interest at a rate per annum equal to Term SOFR Rate + 2.50% (effective rate was 4.78% at August 31, 2022)
 

(vi)

Revolving Loan allows for Letters of Credit up to $7,500,000 (none were outstanding at August 31, 2022)

 

The Loan Agreement also contains provisions that require the Company to maintain a minimum fixed charge ratio and limits any additional debt with other lenders. Available credit under the current $15,000,000 revolving line of credit with the Lender was approximately $2,939,100 at August 31, 2022.

 

The following table reflects aggregate future scheduled maturities of long-term debt during the next five fiscal years and thereafter as follows:

 

Years ending February 28 (29),

        

2023

   $ 900,000  

2024

     1,800,000  

2025

     1,800,000  

2026

     1,800,000  

2027

     1,800,000  

Thereafter

     27,900,000  

Total

   $ 36,000,000