XML 100 R15.htm IDEA: XBRL DOCUMENT v2.4.0.6
Credit Facility
12 Months Ended
Aug. 25, 2012
Debt Disclosure [Abstract]  
Credit Facility
Credit Facilities
On October 13, 2009, we entered into a Loan and Security Agreement (the "Loan Agreement") with Burdale Capital Finance, Inc., as Agent (the "Agent"). The Loan Agreement provided for an initial $20.0 million revolving credit facility, based on the Company's eligible accounts receivable and eligible inventory. The facility expired on October 13, 2012. The Loan Agreement contained no financial covenant restrictions for borrowings up to $12.5 million; provided that borrowings cannot exceed the Asset Coverage Amount (as defined in the Loan Agreement) divided by 2.25. The Loan Agreement required us to comply with certain financial covenants not yet established if we borrowed more than $12.5 million up to $20.0 million. These covenants to be established included minimum EBITDA and minimum liquidity measurements, as defined in the agreement and limitations on capital expenditures. The Loan Agreement also included a framework to expand the size of the facility up to $50.0 million, based on mutually agreeable covenants to be determined at the time of the expansion. Interest on loans made under the credit facility would have been based on the greater of LIBOR or 2.0% plus a margin of 4.0% or the greater of prime rate or 4.25% plus a margin of 3.0%. The unused line fee associated with this Loan Agreement was 1.25% per annum. No borrowings were made under the Loan Agreement in Fiscal 2012.
The Loan Agreement contained typical affirmative representations and covenants for a credit agreement of this size and nature. Additionally, the Loan Agreement contained negative covenants limiting our ability, among other things, to incur debt, grant liens, make acquisitions, make certain investments, pay certain dividends and distributions (including stock repurchases), engage in mergers, consolidations or acquisitions and sell certain assets. The Loan Agreement expressly prohibited the payment of cash dividends without the consent of the Agent and the lenders thereunder in their sole discretion. Our obligations under the Loan Agreement were secured by a security interest in all of our accounts and other receivables, chattel paper, documents, deposit accounts, instruments, equipment, inventory, investment property, leasehold interest, cash and cash equivalents, letter-of-credit rights, most real property and fixtures and certain other business assets.

On February 1, 2012 Wells Fargo Bank, National Association purchased the loan portfolio of Burdale Capital Finance, Inc., which included the Loan Agreement. No modifications were made to the Loan Agreement as a result of this transaction.

The Loan Agreement expired on October 13, 2012. We are reviewing other financing alternatives and expect to enter into a similar facility before the end of calendar 2012.