DEBT

Long-term debt consists of the following (in thousands):

		(86,425)			(86,425)
	March 31, 2012			December 31, 2011
Convertible notes	$	91,875		$	91,875
Less unamortized debt discount		(2,725	)		(5,450	)

		89,150			86,425
Less current portion		(89,150	)		(86,425	)

Total long-term debt	$	—		$	—

The Company's outstanding debt consists of convertible notes and a revolving credit facility. At March 31, 2012, the Company had $36.7 million of outstanding borrowings under its revolving credit facility and additional available borrowing capacity of approximately $63.2 million.

Convertible Notes Offering. The Company's outstanding $91.9 million convertible notes are due on July 1, 2012.

On and after April 1, 2012, until the close of business on the third business day immediately preceding the maturity date, holders may convert their notes. Upon conversion of any notes, the Company will pay, on the date of maturity, cash up to the principal amount of the notes converted and deliver shares of its common stock to the extent the daily conversion value exceeds the proportionate principal amount of such notes based on a pre-established 40 trading-day observation period defined by the debt agreement. The conversion rate will be 45.9116 shares of common stock per $1,000 principal amount of notes, which is equivalent to a conversion price of approximately $21.78 per share of common stock. Shares issued as a result of the conversion of any notes will have a dilutive effect on future earnings per share.

The following table provides additional information regarding the Company's convertible notes (in thousands, except conversion price):

		6 months			6 months
	March 31, 2012			December 31, 2011
Principal amount of the liability component	$	91,875		$	91,875
Unamortized discount of liability component		(2,725	)		(5,450	)
Net carrying amount of liability component		89,150			86,425
Carrying amount of the equity component		23,360			23,360
Remaining amortization period of discount		3 months			6 months
Conversion price	$	21.78		$	21.78
Effective interest rate on liability component		18.41	%		18.41	%
If-converted value in excess of principal amount (a)	$	20,713		$	3,454
If-converted number of shares to be issued (a)		776			153

		6 months		6 months
	Three Months Ended March 31,
	2012		2011
Interest expense at coupon rate (6.0%)	$	1,378	$	1,463
Non-cash interest in accordance with ASC 470		2,725		2,323

Total interest expense recognized on convertible debt instruments	$	4,103	$	3,786

(a)

If-converted value amounts are for disclosure purposes only. The if-converted value in excess of the principal amount and the if-converted number of shares to be issued illustrated above are based on the average stock price of $26.69 during the three months ended March 31, 2012, which exceeded the conversion price of $21.78. The actual number of shares issued upon conversion will be determined by the Company's stock price during the 40 trading-day observation period defined by the debt agreement.

Revolving Credit Facility. On January 6, 2012, the Company entered into an Amended and Restated Credit Agreement (the "Revolving Credit Facility") with BB&T, Wells Fargo Capital Finance, LLC and BB&T Capital Markets (the "Lenders"). Under the Amended Credit Agreement, the Lenders agreed to provide us with one or more revolving loans in a collective maximum principal amount of $100,000,000. The Revolving Credit Facility replaces the previous revolving credit facility in its entirety. Amounts drawn under the Revolving Credit Facility are subject to a borrowing base consisting of certain accounts receivables, inventories, machinery and equipment and real estate.

Compliance with Debt Covenants and Restrictions. The Company's ability to make scheduled principal and interest payments and to borrow and repay amounts under any outstanding revolving credit facility, and continue to comply with any loan covenants depends primarily on the Company's ability to generate substantial cash flow from operations.

As of March 31, 2012, the Company was in compliance with all of the covenants contained in its debt agreements. Failure to comply with the loan covenants might cause lenders to accelerate the repayment obligations under the credit facility, which may be declared payable immediately based on a default and which could result in a cross-default under the convertible notes.