Note 9 - Line of Credit

3 Months Ended

Mar. 31, 2018

Notes to Financial Statements

Debt Disclosure [Text Block]

9. Line of Credit

The Company and its subsidiaries are party to a loan agreement with Citizens Bank of Pennsylvania which, as of

March 31, 2018,

provides for a

$40

million revolving credit facility and includes a sub-limit of

$5

million for letters of credit (the “Revolving Credit Facility”) and expires

December 11, 2019. 

The Revolving Credit Facility has been amended several times, most recently pursuant to the Tenth Amendment entered into on

February 14, 2018

when the Company increased the Revolving Credit Facility to

$40

million from its previous amount of

$35

million. The Company also entered into to the Ninth Amendment on

December 8, 2017

when the Company was granted waivers that expressly allowed a cash dividend of up to

$12.4

million and waived certain expenses from the Company’s loan covenant calculations, including

$1.3

million of certain expenses related legal costs, office closures and other expenses in fiscal

2017,

up to

$1.0

million consulting expenses for analyzing tax credits for research and development costs and

179D

energy savings tax credits on a rolling

four

quarter basis and up to

$4.6

million for goodwill impairment.  Borrowings under the Revolving Credit Facility bear interest at

one

of

two

alternative rates, as selected by the Company at each incremental borrowing.  These alternatives are: (i) LIBOR (London Interbank Offered Rate), plus applicable margin, typically borrowed in fixed

30

-day increments or (ii) the agent bank’s prime rate generally borrowed over shorter durations.  The Company also pays unused line fees based on the amount of the Revolving Credit Facility that is

not

drawn.  Unused line fees are recorded as interest expense.  The effective interest rate, including unused line fees, for the

thirteen

week period ended

March 31, 2018

was

3.0%.

All borrowings under the Revolving Credit Facility are collateralized by all of the assets of the Company and its subsidiaries and a pledge of the stock of its subsidiaries.  The Revolving Credit Facility also contains various financial and non-financial covenants, such as a covenant that restricts on the Company’s ability to borrow in order to pay dividends.  As of

March 31, 2018,

the Company was in compliance with all covenants contained in its Revolving Credit Facility.

Borrowings under the line of credit as of

March 31, 2018

and

December 30, 2017

were

$32.0

million and

$27.3

million, respectively. At

March 31, 2018

and

December 30, 2017

there were letters of credit outstanding for

$0.8

million. At

March 31, 2018,

the Company had availability for additional borrowings under the Revolving Credit Facility of

$7.2

million.