Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an


          Off-Balance Sheet Arrangement of a Registrant



As previously disclosed, Ethan Allen Interiors Inc. (the "Company") is party to a $165 million revolving credit facility agreement (the "Facility") with a syndicate of banks pursuant to the Second Amended and Restated Credit Agreement, dated December 21, 2018 (the "Credit Agreement"). The Facility provides a revolving credit line, subject to borrowing base availability, with the maturity date of December 21, 2023. The material terms of the Facility are also described in Note 11 of the Company's Annual Report on Form 10-K for the fiscal year ended June 30, 2019.

On March 23, 2020, the Company provided notice to the administrative agent under the Credit Agreement to borrow an aggregate principal amount of $80 million under the Facility. Prior to such notice, there were no borrowings outstanding under the Facility. The borrowing bears interest at a rate equal to the one-month LIBOR rate of 0.9375% plus a spread using a debt leverage pricing grid, currently at 1.50%. Interest on the loan outstanding is payable monthly in arrears and the principal balance is payable on the maturity date of December 21, 2023. The Company may repay amounts borrowed at any time without penalty. The Company, while currently having available cash on its balance sheet and no outstanding debt, elected to draw on the Facility to increase its cash position as a precautionary measure and to maximize financial flexibility in light of the current uncertainty surrounding the impact of COVID-19.

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