Short-Term and Long-Term Obligations | 6 Months Ended |
Dec. 31, 2013 |
Debt Instruments [Abstract] | ' |
Short-term and Long-term Obligations | ' |
Short-term and Long-term Obligations |
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Short-term and long-term obligations as of December 31, 2013 and June 30, 2013 consisted of the following (in thousands): |
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| December 31, | | June 30, |
| 2013 | | 2013 |
Lines of credit: | | | |
Bank of America | $ | 10,899 | | | $ | 10,899 | |
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CTBC Bank | 3,520 | | | — | |
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Total line of credit | 14,419 | | | 10,899 | |
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Building term loans: | | | |
Bank of America | 7,933 | | | 9,333 | |
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CTBC Bank | 19,989 | | | 14,939 | |
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Total building term loans | 27,922 | | | 24,272 | |
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Total debt | 42,341 | | | 35,171 | |
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Current portion | (37,208 | ) | | (28,638 | ) |
Long-term portion | $ | 5,133 | | | $ | 6,533 | |
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Activities under Revolving Lines of Credit and Term Loans |
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Bank of America |
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In October 2011, the Company entered into an amendment to the existing credit agreement with Bank of America, N.A. ("Bank of America") which provided for (i) a $40,000,000 revolving line of credit facility that matured on June 15, 2013 and (ii) a five-year $14,000,000 term loan facility. The term loan is secured by three buildings located in San Jose, California and the principal and interest are payable monthly through September 30, 2016 with an interest rate at the LIBOR rate plus 1.50% per annum. The credit agreement was subsequently amended to extend the maturity date of the revolving line of credit facility to August 15, 2014. |
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The line of credit facility provides for borrowings denominated both in U.S. dollars and in Taiwanese dollars. For borrowings denominated in U.S. dollars, the interest rate for the revolving line of credit is at the LIBOR rate plus 1.25% per annum. The LIBOR rate was 0.17% at December 31, 2013. For borrowings denominated in Taiwanese dollars, the interest rate is equal to the lender's established interest rate which is adjusted monthly. |
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As of December 31, 2013 and June 30, 2013, the total outstanding borrowings under the Bank of America term loan was $7,933,000 and $9,333,000, respectively. The total outstanding borrowings under the Bank of America line of credit was $10,899,000 as of December 31, 2013 and June 30, 2013, respectively. The interest rates for these loans ranged from 1.20% to 1.67% per annum at December 31, 2013 and 1.23% to 1.69% per annum at June 30, 2013, respectively. As of December 31, 2013, the unused revolving line of credit with Bank of America was $29,101,000. |
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CTBC Bank |
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In October 2011, the Company obtained an unsecured revolving line of credit from CTBC Bank Co., Ltd ("CTBC Bank", formerly, China Trust Bank) totaling NT$300,000,000 Taiwanese dollars, or $9,898,000 U.S. dollar equivalents. In July 2012, the Company increased the credit facility to NT$450,000,000 Taiwanese dollars or $14,912,000 U.S. dollar equivalents. The term loan was secured by the land and building located in Bade, Taiwan with an interest rate equal to the lender’s established interest rate plus 0.30% which was adjusted monthly. |
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In November 2013, the Company entered into an amendment to the existing credit agreement with CTBC Bank to increase the credit facility amount and extend the maturity date to November 30, 2014. The amendment provides for (i) a 13-month NT$700,000,000 Taiwanese dollars or $23,787,000 U.S. dollar equivalents term loan secured by the land and building located in Bade, Taiwan with an interest rate equal to the lender's established New Taiwan Dollar ("NTD") interest rate plus 0.25% per annum which is adjusted monthly and (ii) a 13-month unsecured term loan up to NT$100,000,000 Taiwanese dollars or $3,398,000 U.S. dollar equivalents and a 13-month revolving line of credit up to 80% of eligible accounts receivable in an aggregate amount of up to NT$500,000,000 Taiwanese dollars or $16,991,000 U.S. dollar equivalents with an interest rate equal to the lender's established NTD interest rate plus 0.25% per annum or lender's established USD interest rate plus 0.30% per annum which is adjusted monthly. The total borrowings allowed under the credit agreement is capped at NT$1,000,000,000 Taiwanese dollars or $33,981,000 U.S. dollar equivalents. |
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The total outstanding borrowings under the CTBC Bank term loan was denominated in Taiwanese dollars and was translated into U.S. dollars of $19,989,000 and $14,939,000 at December 31, 2013 and June 30, 2013, respectively. The total outstanding borrowings under the CTBC Bank revolving line of credit was $3,520,000 and $0 at December 31, 2013 and June 30, 2013, respectively. The interest rates for these loans ranged from 1.11% to 1.74% per annum at December 31, 2013 and was at 1.20% per annum at June 30, 2013. At December 31, 2013, NT$294,340,000 Taiwanese dollars or $9,806,000 U.S. dollar equivalents were available for future borrowing under this credit agreement. |
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Covenant Compliance |
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The credit agreement with Bank of America contains customary representations and warranties and customary affirmative and negative covenants applicable to the Company and its subsidiaries. The credit agreement contains certain financial covenants, including the following: |
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| • | | Not to incur on a consolidated basis, a net loss before taxes and extraordinary items in any two consecutive quarterly accounting periods; | | | | |
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| • | | The Company’s funded debt to EBITDA ratio (ratio of all outstanding liabilities for borrowed money and other interest-bearing liabilities, including current and long-term debt, less the non-current portion of subordinated liabilities to EBITDA) shall not be greater than 2.00; | | | | |
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| • | | The Company’s unencumbered liquid assets, as defined in the agreement, held in the United States shall have an aggregate market value of not less than $30,000,000, measured as of the last day of each fiscal quarter and the last day of each fiscal year. | | | | |
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As of December 31, 2013 and June 30, 2013, total assets of $663,476,000 and $586,742,000, respectively collateralized the line of credit with Bank of America and were all of the assets of the Company except for the three buildings located in San Jose, California and the land and building located in Bade, Taiwan. As of December 31, 2013 and June 30, 2013, total assets collateralizing the term loan with Bank of America were $17,699,000 and $17,813,000, respectively. As of December 31, 2013, the Company was in compliance with all financial covenants associated with the credit agreement with Bank of America. |
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As of December 31, 2013 and June 30, 2013, the net book value of land and building located in Bade, Taiwan collateralizing the term loan with CTBC Bank was $27,556,000 and $27,702,000, respectively. There are no financial covenants associated with the term loan with CTBC Bank at December 31, 2013. |