Quarterly report pursuant to Section 13 or 15(d)

Long-Term Debt

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Long-Term Debt
6 Months Ended
Jun. 30, 2012
Long-Term Debt  
Long-Term Debt

(5)                     Long-Term Debt

 

On August 9, 2011, the Company entered into a Revolving Credit Agreement with Wells Fargo Bank, N. A., that permits the Company to borrow up to $15,000 through August 9, 2013, bearing interest at LIBOR plus 1.25 percent. The Company must pay an annual commitment fee of 0.25 percent on the unused portion of the commitment. At June 30, 2012 and December 31, 2011, the Company had $15,000 available under this facility.

 

A term loan of $10,000 was obtained in conjunction with the Revolving Credit Agreement with Wells Fargo Bank, N. A., and has a maturity date of August 9, 2014, a variable interest rate of LIBOR plus 1.25 percent (1.50 percent as of June 30, 2012) and monthly amortization of principal. The term loan is collateralized by the Company’s manufacturing facility in Spanish Fork, Utah.

 

Long-term debt at June 30, 2012 and December 31, 2011 consists of the following:

 

 

 

June 30,

 

December 31,

 

 

 

2012

 

2011

 

Term loan due in monthly installments of approximately $285, including interest, secured by real estate

 

$

7,552

 

$

9,190

 

Less current installments

 

(3,320

)

(3,296

)

Long-term debt

 

$

4,232

 

$

5,894

 

 

The various debt agreements contain restrictions on liquidity, leveraging, minimum net income and consecutive quarterly net losses. In addition, the agreements restrict capital expenditures, lease expenditures, other indebtedness, liens on assets, guaranties, loans and advances, and the merger, consolidation and the transfer of assets except in the ordinary course of business.  The Company is currently in compliance with these debt covenants.