Debt

The Company has a five-year, $200.0 million senior secured revolving credit facility under a credit agreement (the "Credit Agreement") that expires March 13, 2019. Advances under the senior revolving credit facility may be used for working capital, acquisitions, capital expenditures, issuance of letters of credit and other lawful corporate purposes.

The Credit Agreement includes the following covenants and borrowing limitations:


•	Our Senior Leverage Ratio, as defined in the agreement, may not exceed 2.50 to 1.00 as of the end of each fiscal quarter.


•	We are required to maintain a Fixed Charge Coverage Ratio, as defined in the agreement, greater than or equal to 1.25 to 1.00 as of the end of each fiscal quarter.


•	Asset dispositions (other than inventory and obsolete or unneeded equipment disposed of in the ordinary course of business) are limited to $20.0 million per 12-month period.

Amounts borrowed under the Credit Agreement bear interest at LIBOR or an Alternate Base Rate, plus in each case, an additional margin based on the Senior Leverage Ratio. The additional margin on Alternate Base Rate and LIBOR-based loans ranges between 0.25% and 1.0% and between 1.25% and 2.0%, respectively.

The Credit Agreement also permits us to borrow in Canadian Dollars with a sublimit of U.S. $40.0 million. Amounts borrowed in Canadian Dollars will bear interest either at the CDOR Rate, plus an additional margin based on the Senior Leverage Ratio ranging from 1.25% to 2.0%, or at the Canadian Prime Rate, plus an additional margin based on the Senior Leverage Ratio ranging from 1.75% to 2.5%. The CDOR Rate is equal to the sum of the annual rate of interest, which is the rate determined as being the arithmetic average of the quotations of all institutions listed in respect of the relevant CDOR interest period for Canadian Dollar denominated bankers’ acceptances, plus 0.1%. The Canadian Prime Rate is equal to the greater of (i) the rate of interest per annum most recently announced or established by JPMorgan Chase Bank, N.A., Toronto Branch as its reference rate in effect on such day for determining interest rates for Canadian Dollar denominated commercial loans in Canada and (ii) the CDOR Rate plus 1.0%.

The Unused Credit Facility Fee is between 0.20% and 0.35% based on the Senior Leverage Ratio.

Under our Credit Agreement, we may declare and pay dividends on our capital stock during any fiscal year up to an amount which, when added to all other dividends paid during such fiscal year, does not exceed 50% of our cumulative net income for such fiscal year to date. We currently have no future plans to pay cash dividends.

The carrying value of the senior revolving credit facility approximates its fair value at each balance sheet date.

The Credit Agreement includes a Senior Leverage Ratio covenant, which provides that Consolidated Funded Indebtedness, as defined in the Credit Agreement, as of the end of any fiscal quarter, may not exceed 2.5 times Consolidated EBITDA, as defined in the Credit Agreement, over the previous four quarters. For the four quarters ended June 30, 2016, Consolidated EBITDA, as defined in the Credit Agreement, was $71.9 million. Accordingly, at June 30, 2016, there was a restriction on our ability to access the full amount of the senior revolving credit facility. Consolidated Funded Indebtedness at June 30, 2016 was $13.1 million.

Availability under the senior revolving credit facility is as follows:



	June 30, 2016		June 30, 2015
	(In thousands)
Senior revolving credit facility	$	200,000	$	200,000
Capacity constraint due to the Senior Leverage Ratio	20,138		54,968
Capacity under the senior revolving credit facility	179,862		145,032
Letters of credit issued	20,755		40,587
Borrowings outstanding	—		8,804
Availability under the senior revolving credit facility	$	159,107	$	95,641

The Company is in compliance with all other affirmative, negative, and financial covenants under the Credit Agreement.

The Company acquired $1.9 million of long-term debt in February 2016 as part of the BTE acquisition, which was subsequently repaid in March 2016.