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Subsequent Event
9 Months Ended
Dec. 31, 2018
Subsequent Events [Abstract]  
Subsequent Event

10. Subsequent Event

On February 12, 2019, the Company entered into an amendment to its existing loan and security agreement governing the terms and conditions of its Line of Credit. Such amendment:

waives compliance with the minimum interest coverage ratio requirement for the measurement period ending November 30, 2018;

modifies the minimum interest coverage ratio requirement to be 0.44 to 1.0 for the measurement period ending December 31, 2018, and 0.20 to 1.0 for the measurement period ending January 31, 2019, and 1.0 to 1.0 for the measurement period ending February 28, 2019 and thereafter; and

reduced the Line of Credit to $140 million.

After giving effect to such amendment, the interest coverage ratio is calculated as of each month end for the three-month period then ended as the ratio of (A) the Company’s adjusted net earnings plus interest expense and provision for income tax for the applicable period to (B) the Company’s interest expenses for such period and the minimum loss reserve amount is calculated as of each month for the three-month period then ended as (A) four times the net charge-offs divided by (B) the net balances due under all contracts divided by three. The interest rates for borrowings under the credit facility remain at base rate plus 3.0% or LIBOR plus 4.0%.

The Company’s obligations under the loan and security agreement are secured by substantially all of the operating assets of the Company. The loan and security agreement contains other events of default and requires the Company to comply with certain other financial ratios and covenants and to satisfy specified financial tests, including maintenance of asset quality and portfolio performance tests. Unless waived by lender, failure to meet any required financial ratios, covenants or financial tests would result in an event of default under the loan and security agreement. If an event of default occurs, theCompany’s lenders could increase borrowing costs, restrict the Company’s ability to obtain additional borrowings under the facility, accelerate all amounts outstanding under the facility, or enforce their interest against collateral pledged under the facility.