5.Long-term Obligations

Capital Leases

The Company incurs capital lease obligations for student computers under a lease line of credit with PNC Equipment Finance, LLC with annual borrowing limits. The Company had annual borrowing availability under the lease line of credit of $35.0 million as of March 31, 2015 and June 30, 2014, respectively. As of March 31, 2015 and June 30, 2014, the cumulative annual borrowings outstanding under the lease line of credit was $32.3 million and $36.9 million, respectively, with lease interest rates ranging from 2.49% to 3.08%. Individual leases under the lease line of credit include 36-month payment terms with a $1 purchase option at the end of each lease term. The Company has pledged the assets financed to secure the outstanding leases. The lease line of credit was subject to cross default compliance provisions in the Company’s line of credit agreement with PNC Bank, N.A. (see Note 6). The net carrying value of leased student computers as of March 31, 2015 and June 30, 2014 was $21.6 million and $20.9 million, respectively.

In July 2014, the Company extended its leasing agreement with an annual borrowing limit of $35 million for fiscal year 2015. This availability expires in July 2015 and interest rates on the new borrowings are based upon an initial rate of 2.34% modified by changes in the three year interest rate swaps rate as published in the Federal Reserve Statistical Release H.15, “Selected Interest Rates,” between June 25, 2014 and the Lease Commencement Date, as defined in the lease line of credit.

The following is a summary as of March 31, 2015 of the present value of the net minimum payments due on outstanding capital leases under the Company’s commitments:

	Capital
As of June 30,	Leases
	($ in thousands)

2015	$	5,537
2016	16,197
2017	8,856
2018	2,601

Total minimum payments	33,191
Less amount representing interest (imputed weighted average capital lease interest rate of 2.65%)	(897		)

Net minimum payments	32,294
Less current portion	(17,845		)

Present value of minimum payments, less current portion	$	14,449