Notes Payable and Long-Term Debt

12 Months Ended

Sep. 30, 2012

Notes Payable and Long-Term Debt [Abstract]

Notes Payable and Long-Term Debt

10. Notes Payable and Long-Term Debt:

The Company did not have any outstanding notes payable or long-term debt at September 30, 2012 and 2011.

On March 2, 2011, the Company entered into a new credit agreement (as amended, the “Credit Agreement”) with a bank. Under the Credit Agreement, the Company can borrow up to $25.0 million principally secured by its accounts receivable, inventories and equipment. In addition, certain domestic subsidiaries of the Company have guaranteed the obligations of the Company under the Credit Agreement and such subsidiaries have secured the obligations by the pledge of certain of the assets of such subsidiaries. The New Credit Agreement expires on March 2, 2014. The Credit Agreement limits the incurrence of additional indebtedness, requires the maintenance of certain financial ratios, restricts the Company and its subsidiaries’ ability to pay cash dividends and contains other covenants customary in agreements of this type. The interest rate for borrowings under the New Credit Agreement is a LIBOR based rate with a margin spread of 250-350 basis points depending upon the maintenance of certain ratios. At September 30, 2012, the Company was in compliance with all covenants. At September 30, 2012 and 2011, there were no borrowings outstanding under the Credit Agreement, standby letters of credit outstanding in the amount of $0.2 million and additional borrowings available were $24.8 million.