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Credit Facility And Debt
9 Months Ended
Mar. 29, 2013
Debt Disclosure [Abstract]  
Credit Facility And Debt
Credit Facility and Debt
During the quarter ended October 1, 2010, we terminated our previous credit facility with two commercial banks and entered into a new $40.0 million credit facility with Silicon Valley Bank ("SVB") for an initial term of one year expiring on September 30, 2011. We repaid the outstanding debt of $5.0 million under the previous credit facility on October 1, 2010 with the proceeds of advance borrowings of $6.0 million under the new facility with SVB. On September 23, 2011, the availability of the facility was extended and, on November 2, 2011, the facility was amended to expire on February 28, 2014 and provide for a two-year term loan for up to $8.3 million to fund the redemption of the preference shares issued by our Singapore subsidiary. On January 30, 2012, we borrowed $8.3 million to complete that redemption. The term loan matures on January 31, 2014 and must be repaid in 24 equal monthly principal payments commencing on February 29, 2012.
Our SVB credit facility provides for a committed amount of up to $40.0 million. The facility provides for (1) advance borrowings (with no stated maturity date other than the February 28, 2014 expiration of the facility); (2) fixed term Eurodollar loans for up to six months; (3) a two-year term loan of $8.3 million; and (4) the issuance of standby or commercial letters of credit. As of March 29, 2013, available credit under this facility was $24.4 million reflecting borrowings of $9.8 million , as described below, and outstanding letters of credit of $5.2 million.
As of March 29, 2013, our outstanding debt under the SVB facility consisted of the $6.0 million advance borrowings in fiscal 2011 and a $3.8 million outstanding balance on the original $8.3 million term loan. Since the expiration of the credit facility is less than 12 months from March 29, 2013, we reclassified the $6.0 million advance borrowings from long-term debt as of June 29, 2012 to short-term debt as of March 29, 2013.
The advance borrowings carry an interest rate computed at the daily prime rate as published in the Wall Street Journal. Interest on Eurodollar loans is offered at LIBOR plus a spread of between 2.00% to 2.75% based on our current leverage ratio. The interest rate on Eurodollar loans is adjustable quarterly based on the computed actual leverage ratio for the most recently completed fiscal quarter. During the first three quarters of fiscal 2013, the weighted average interest rate on our $6.0 million advance borrowings was 3.25%. The two-year term loan bears a fixed interest rate of 5% per annum and provides for equal monthly payments of principal. The SVB credit facility, as further amended on September 28, 2012, contains a minimum liquidity ratio covenant and a minimum profitability covenant. As of March 29, 2013, we were in compliance with these financial covenants. The facility also imposes certain restrictions on our ability to pay dividends or make distributions to our stockholders under certain circumstances. Certain of our assets, including accounts receivable, inventory, and equipment, are pledged as collateral for the credit facility. Pursuant to the loan and security agreement, if a material adverse event occurs, all obligations in connection with the agreement would be immediately due and payable.