| Debt |
| | | |
| | | As of June 30, 2025, the Company was subject to potential federal and
state tax examinations for the tax years including and subsequent to 2020. |
| | | |
| 11. Debt | | The Company’s long-term debt as of June 30, 2025 and 2024 was
as follows (in thousands): |
| | |
June 30,
2025 | | |
June 30,
2024 | |
| Revolving Line of Credit | |
$ | 53,000 | | |
$ | 13,000 | |
| Less: unamortized discount and deferred financing costs | |
| - | | |
| (97 | ) |
| Total long-term debt | |
$ | 53,000 | | |
$ | 12,903 | |
| | | The Company is party, as borrower, to a syndicated credit agreement
(the “Credit Agreement”). Prior to the amendment described below, the agreement allowed for borrowings in the maximum aggregate
principal amount of up to $100 million, with an accordion feature to increase the revolving credit facility by up to $40 million for a
total of $140 million. On March 26, 2025, the Company amended the Credit Agreement to increase the maximum aggregate principal amount
from $100 million to $150 million and increase the accordion feature from $40 million to $50 million, for a total of $200 million. A portion
of the revolving credit facility is available for swingline loans and for the issuance of standby letters of credit. The amendment increased
the sublimit for swingline loans from $5 million to $7.5 million and the sublimit for standby letters of credit from $10 million to $15
million. In addition, as part of the amendment, the maturity date of the Credit Agreement was extended from May 6, 2027 to March 26, 2030. |
| | | |
| | | Pursuant to the terms of the Credit Agreement, in connection with the
discontinuation of the Bloomberg Short-Term Bank Yield Index rate (the “BSBY rate”), during October 2024, the BSBY rate was
replaced as the reference rate under the Credit Agreement by the Secured Overnight Financing Rate (“SOFR”) plus a SOFR adjustment
ranging from a minimum of 0.11% to a maximum of 0.43%. As a result, borrowings (other than swingline loans) under the Credit Agreement
bear interest, at a rate, at the Company’s election at the time of borrowing, equal to (a) SOFR plus 0.11% to 0.43%, plus an additional
adjustment margin that ranges between 1.25% and 1.75% depending on the Company’s consolidated leverage ratio, which is a ratio of
consolidated funded indebtedness to consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) (the “Consolidated
Leverage Ratio”) or (b) the highest of (i) prime, (ii) the federal funds rate plus 50 basis points, and (iii) SOFR plus 100 basis
points (such highest rate, the “Base Rate”), plus a margin that ranges between 0.25% and 0.75% depending on the Consolidated
Leverage Ratio. Swingline loans generally bear interest at the Base Rate plus a margin that ranges between 0.25% and 0.75% depending on
the Consolidated Leverage Ratio. |
| | | The Credit Agreement contains certain
covenants, including financial covenants requiring the Company to comply with maximum leverage ratios and minimum interest coverage ratios.
The Credit Agreement also contains other provisions which may restrict the Company’s ability to, among other things, dispose of
or acquire assets or businesses, incur additional indebtedness, make certain investments and capital expenditures, pay dividends, repurchase
shares and enter into transactions with affiliates. At June 30, 2025, the Company was in compliance with its covenants under the Credit
Agreement and $56.1 million was available to borrow under the revolving credit facility. |
| | | |
| | | The obligations of the Company under the Credit Agreement are secured
by substantially all of the assets of the Company and certain of its subsidiaries, and are guaranteed, jointly and severally, by certain
of the Company’s subsidiaries. |
| | | |
| | | The carrying value of the Company’s long-term debt reported in
the consolidated balance sheets herein approximates its fair value since it bears interest at variable rates approximating market
rates. |
|