Note 11

6 Months Ended

Mar. 25, 2017

Notes to Financial Statements

Fair Value Disclosures [Text Block]

Note 11 We have classified our investment securities as marketable securities held to maturity and available for sale. The FASB defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the FASB has established three levels of inputs that may be used to measure fair value:

Level 1 Observable input such as quoted prices in active markets for identical assets or liabilities;

Level 2 Observable inputs, other than Level 1 inputs in active markets, that are observable either directly or indirectly; and

Level 3 Unobservable inputs for which there is little or no market data, which require the reporting entity to develop its own assumptions.

Marketable securities held to maturity and available for sale consist primarily of investments in mutual funds, preferred stock and corporate bonds.  The fair values of mutual funds are based on quoted market prices in active markets and are classified within Level

1

of the fair value hierarchy.  The fair values of preferred stock, corporate bonds and certificates of deposit are based on quoted prices for identical or similar instruments in markets that are not active.  As a result, preferred stock, corporate bonds and certificates of deposit are classified within Level

2

of the fair value hierarchy. 

The amortized cost, unrealized gains and losses, and fair market values of our investment securities held to maturity at

March

25,

2017

are summarized as follows:

			Gross		Gross		Fair
	Amortized		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
	(in thousands)
Corporate Bonds	$	120,368	$	306	$	225	$	120,449
Certificates of Deposit		1,920		4		-		1,924
Total investment securities held to maturity	$	122,288	$	310	$	225	$	122,373

The amortized cost, unrealized gains and losses, and fair market values of our investment securities available for sale at

March

25,

2017

are summarized as follows:

			Gross		Gross		Fair
	Amortized		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
	(in thousands)
Mutual Funds	$	13,003	$	-	$	269	$	12,734
Preferred Stock		16,791		502		67		17,226
Total investment securities available for sale	$	29,794	$	502	$	336	$	29,960

The mutual funds seek current income with an emphasis on maintaining low volatility and overall moderate duration. The unrealized losses of

$269,000

are spread over

4

funds with total fair market value of

$12.7

million. The Fixed-to-Floating Perpetual Preferred Stock generate fixed income to call dates in

2018,

2019

and

2025

and then income is based on a spread above LIBOR if the securities are not called. The mutual funds and Fixed-to-Floating Perpetual Preferred Stock do not have contractual maturities; however, we classify them as long term assets as it is our intent to hold them for a period of over

one

year, although we

may

sell some or all of them depending on presently unanticipated needs for liquidity or market conditions. The corporate bonds generate fixed income to maturity dates in

2017

through

2021,

with

$108

million maturing within

3

years. Our expectation is that we will hold the corporate bonds to their maturity dates and redeem them at our amortized cost.

The amortized cost, unrealized gains and losses, and fair market values of our investment securities held to maturity at

September

24,

2016

are summarized as follows:

			Gross		Gross		Fair
	Amortized		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
	(in thousands)
Corporate Bonds	$	103,311	$	734	$	138	$	103,907
Certificates of Deposit		960		11		-		971
Total investment securities held to maturity	$	104,271	$	745	$	138	$	104,878

The amortized cost, unrealized gains and losses, and fair market values of our investment securities available for sale at

September

24,

2016

are summarized as follows:

			Gross		Gross		Fair
	Amortized		Unrealized		Unrealized		Market
	Cost		Gains		Losses		Value
	(in thousands)
Mutual Funds	$	13,003	$	-	$	520	$	12,483
Preferred Stock		16,791		273		82		16,982
Total investment securities available for sale	$	29,794	$	273	$	602	$	29,465

The amortized cost and fair value of the Company’s held to maturity securities by contractual maturity at

March

25,

2017

and

September

24,

2016

are summarized as follows:

	March 25, 2017				September 24, 2016
			Fair				Fair
	Amortized		Market		Amortized		Market
	Cost		Value		Cost		Value
	(in thousands)
Due in one year or less	$	37,176	$	37,182	$	13,539	$	13,552
Due after one year through five years		85,112		85,191		90,732		91,326
Due after five years through ten years		-		-		-		-
Total held to maturity securities	$	122,288	$	122,373	$	104,271	$	104,878
Less current portion		37,176		37,182		13,539		13,552
Long term held to maturity securities	$	85,112	$	85,191	$	90,732	$	91,326

Proceeds from the redemption and sale of marketable securities were

$4,629,000

and

$5,104,000

in the

three

and

six

months ended

March

25,

2017

and

$4,186,000

and

$5,384,000

in the

three

and

six

months ended

March

26,

2016,

respectively. No gains or losses were recorded in the

three

and

six

months ended

March

25,

2017

and losses of

$297,000

and

$406,000

were recorded in the

three

and

six

months ended

March

26,

2016,

respectively.

We use the specific identification method to determine the cost of securities sold.