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Notes Payable
 3 Months Ended
Sep. 30, 2022
Debt Disclosure [Abstract]  
Notes Payable

NOTE 8 – NOTES PAYABLE

Notes payable consist of the following:

 

 

September 30,

 

 

June 30,

 

(In thousands)

2022

 

 

2022

 

Revolving Credit Facility

$

37,525

 

 

$

62,525

 

Senior Secured Loans

 

7,248

 

 

 

8,902

 

Unamortized debt issuance costs

 

(142

)

 

 

(133

)

 

 

 

 

 

 

Total notes payable

 

44,631

 

 

 

71,294

 

Less: current portion

 

(4,331

)

 

 

(4,575

)

 

 

 

 

 

 

Total notes payable, net of current portion

$

40,300

 

 

$

66,719

 

 

Future maturities of notes payable for each of the next five fiscal years ending June 30 and thereafter are as follows:

 

(In thousands)

 

 

2023 (remaining)

$

3,221

 

2024

 

4,027

 

2025

 

—

 

2026

 

—

 

2027

 

—

 

Thereafter

 

37,525

 

 

 

 

Total

$

44,773

 

 

Revolving Credit Facility

The Company entered into a $200,000 syndicated, revolving credit facility (the “Revolving Credit Facility”) pursuant to a Credit Agreement dated as of August 5, 2022. The Credit Facility includes a $75,000 accordion feature to support future acquisition opportunities. The Credit Facility was entered into with Bank of America, N.A. and BMO Capital Markets Corp. as joint book runners and joint lead arrangers, Bank of America, N.A. as Administrative Agent, Swingline Lender and Letter of Credit Issuer, Bank of Montreal as syndication agent, KeyBank National Association and MUFG Union Bank, N.A. as co-documentation agents and Bank of America, N. A., Bank of Montreal, KeyBank National Association, MFUG Union Bank, N.A. and Washington Federal Bank, National Association as lenders (such named lenders are collectively referred to herein as “Lenders”). This replaces the $150,000 Revolving Credit Facility dated March 13, 2020.

The Credit Facility has a term of five years and is collateralized by a first-priority security interest in the accounts receivable and other assets of the Company and the guarantors named below on a parity basis with the security interest held by Fiera Private Debt Fund IV LP and Fiera Private Debt Fund V LP described below. Borrowings under the Credit Facility accrue interest (at the Company’s option), at a) the Lenders’ base rate plus 0.75% and can be subsequently adjusted based on the Company’s consolidated net leverage ratio under the facility at the Lenders’ base rate plus 0.50% to 1.50%; b) Term SOFR plus 1.65% and can be subsequently adjusted based on the Company’s consolidated net leverage ratio under the facility at Term SOFR plus 1.40% to 2.40%; and c) Term SOFR Daily Floating Rate plus 1.65% and can be subsequently adjusted based on the Company’s consolidated net leverage ratio under the facility at Term SOFR Daily Floating Rate plus 1.40% to 2.40%. The Company’s U.S. and Canadian subsidiaries are guarantors of the Credit Facility. As of September 30, 2022, the interest rate was 4.34%.

For general borrowings under the Credit Facility, the Company is subject to the maximum consolidated net leverage ratio of 3.00 and minimum consolidated interest coverage ratio of 3.00. Additional minimum availability requirements and financial covenants apply in the event the Company seeks to use advances under the Credit Facility to pursue acquisitions or repurchase its common stock.

Senior Secured Loans

In connection with the Company’s acquisition of Radiant Canada (formerly, Wheels International Inc.), Radiant Canada obtained a CAD$29,000 senior secured Canadian term loan from Fiera Private Debt Fund IV LP (“FPD IV” formerly, Integrated Private Debt Fund IV LP) pursuant to a CAD$29,000 Credit Facilities Loan Agreement. The Company and its U.S. and Canadian subsidiaries are guarantors of the Radiant Canada obligations thereunder. The loan matures on April 1, 2024 and accrues interest at a rate of 6.65% per annum. The Company is required to maintain five months interest in a debt service reserve account to be controlled by FPD IV. As of September 30, 2022, the amount of $581 is recorded as long-term restricted cash in the accompanying condensed consolidated financial statements. The Company made interest-only payments for the first twelve months followed by monthly principal and interest payments of CAD$390 that will be paid through maturity. As of September 30, 2022, $5,077 was outstanding under this term loan.

In connection with the Company’s acquisition of Lomas, Radiant Canada obtained a CAD$10,000 senior secured Canadian term loan from Fiera Private Debt Fund V LP (formerly, Integrated Private Debt Fund V LP) pursuant to a CAD$10,000 Credit Facilities Loan Agreement. The Company and its U.S. and Canadian subsidiaries are guarantors of the Radiant Canada obligations thereunder. The loan matures on June 1, 2024 and accrues interest at a fixed rate of 6.65% per annum. The loan repayment consists of monthly principal and interest payments of CAD$149. As of September 30, 2022, $2,171 was outstanding under this term loan.

The loans may be prepaid in whole at any time providing the Company gives at least 30 days prior written notice and pays the difference between (i) the present value of the loan interest and the principal payments foregone discounted at the Government of Canada Bond Yield for the term from the date of prepayment to the maturity date, and (ii) the face value of the principal amount being prepaid.

The covenants of the Revolving Credit Facility, described above, also apply to the FPD IV and FPD V term loans. As of September 30, 2022, the Company was in compliance with all of its covenants. The restatement described in Explanatory Note has no impact on the Company’s compliance with debt covenant ratios. Although the restatement delayed the process of providing audited financial statements for the fiscal year ended June 30, 2022 and unaudited financial statements for the three months ended September 30, 2022 to the lender, a waiver was received to extend the period within which financial statements may be submitted to the lender.