Credit Arrangements |
3 Months Ended |
|---|---|
Sep. 30, 2026 | |
| Debt Disclosure [Abstract] | |
| Credit Arrangements | 4. CREDIT ARRANGEMENTS On August 18, 2026, the Company, as borrower, entered into a Credit Agreement (the “New Credit Agreement”) with Wells Fargo Bank, National Association (the “Lender”), providing for a secured revolving credit facility in an aggregate principal amount of up to $30.0 million (the “Credit Facility”). Proceeds of borrowings under the Credit Facility are used for working capital and other general corporate purposes. The Credit Facility has a three-year term. The Company may prepay outstanding borrowings under the Credit Facility, in whole or in part, at any time without premium or penalty, subject to the terms of the New Credit Agreement. The New Credit Agreement contains customary affirmative and negative covenants, including covenants that, among other things, limit or restrict the Company’s ability to incur indebtedness, grant liens, make investments, loans and advances, provide guarantees, pay dividends, repurchase stock, engage in mergers, consolidations and other fundamental changes, and enter into certain transactions. The obligations of the Company under the Credit Facility are secured pursuant to a Security Agreement (the “Security Agreement”) entered into with the Lender, pursuant to which the Company granted the Lender a security interest in substantially all of the Company’s personal property assets, whether now owned or hereafter acquired, including accounts receivable, deposit accounts, inventory, equipment, general intangibles, software, licenses, payment rights and related proceeds thereof, but excluding the Company’s real property. In addition, the New Credit Agreement requires the Company to maintain (i) an Asset Coverage Ratio of not less than 2.00 to 1.00, measured as of the last day of each fiscal quarter, and (ii) EBITDA of not less than $15.0 million, measured on a rolling four-quarter basis as of the end of each fiscal quarter. As of September 30, 2026, management believes the Company was in compliance with all covenants. Amounts outstanding under the Credit Facility bear interest at a rate per annum equal to Daily Simple SOFR plus a margin of 1.25%, or an effective interest rate of 5.15%, on September 30, 2026. Interest is payable monthly in arrears on the first business day of each month. In connection with the New Credit Agreement, the Company is required to pay a commitment fee equal to 0.30% per annum on the average daily unused portion of the Credit Facility and letter of credit fees at a rate equal to the then-effective applicable margin for advances under the New Credit Agreement multiplied by the aggregate amount of letters of credit outstanding. The New Credit Agreement contains customary events of default, including, among others, the failure to pay principal, interest or other amounts when due, breaches of covenants, certain bankruptcy or insolvency events, material judgment defaults and certain change of control events. Upon the occurrence and continuation of an event of default, the Lender may terminate its commitments under the Credit Facility and declare all outstanding obligations immediately due and payable. As of September 30, 2026, there were no outstanding borrowings under the New Credit Agreement, exclusive of fees and letters of credit. Letters of credit outstanding with the Lender as of September 30, 2026, totaled $0.9 million. |