Note 5 - Debt

6 Months Ended

Mar. 27, 2022

Notes to Financial Statements

Debt Disclosure [Text Block]

5 DEBT

The Company has debt consisting of a single 25-year term loan with BH Finance LLC, in an aggregate principal balance of $462,554,000 at a 9% annual rate and matures on March 16, 2045 (referred to herein as “Credit Agreement” and “Term Loan”). At March 27, 2022, based on market quotations, the fair value approximates carrying value. This represents a level 2 fair value measurement.

During the three months ended March 27, 2022 we made no principal debt payments. During the six months ended March 27, 2022, we made principal debt payments of $20,062,000.  Future payments are contingent on the Company's ability to generate future excess cash flow, as defined in the Credit Agreement. As of March 27, 2022 there was no excess cash flow payment due (as such term is defined in the Term Loan).

Warrants

We entered into a Warrant Agreement dated  March 31, 2014 (the “Warrant Agreement”). Under the Warrant Agreement, certain warrant holders received warrants to purchase, in cash, an initial aggregate of 600,000 shares of Common Stock, subject to adjustment pursuant to anti-dilution provisions and at an exercise price of $41.90 per share (the “Warrants”). The Warrants expired on March 31, 2022.

The Warrant Agreement required the Warrants to be measured at fair value and included in warrants and other liabilities in our Consolidated Balance Sheets. The initial fair value of the Warrants was $16,930,000. We re-measure the fair value of the liability each reporting period using the Black-Scholes option pricing model. The change in value of $71,000 is reported as income in other, net non-operating income (expense).

As of March 27, 2022, the warrants had no fair value. As of September 26, 2021, the fair value of the warrants was $71,000.

In connection with the issuance of the Warrants, we entered into a Registration Rights Agreement dated  March 31, 2014 (the “Registration Rights Agreement”). The Registration Rights Agreement required, among other matters, that we use our commercially reasonable efforts to maintain the effectiveness for certain specified periods of a shelf registration statement related to the shares of Common Stock to be issued upon exercise of the Warrants.