Revolving Line Of Credit

12 Months Ended

Dec. 31, 2012

Revolving Line Of Credit [Abstract]

Revolving Line Of Credit

(7)REVOLVING LINE OF CREDIT

On August 11, 2010, we entered into a new $150.0 million Credit Agreement (the “Credit Facility”) and a related pledge and security agreement with a group of seven financial institutions, with Bank of America, N.A., as Administrative Agent.  The Credit Facility provides for a revolving credit line of $150.0 million (which may be increased up to $200.0 million subject to our obtaining commitments for such increase), with a $25.0 million sublimit for letters of credit.  The Credit Facility matures on August 11, 2014.  Borrowings under the Credit Facility may be used for general corporate purposes, including working capital requirements, acquisitions and share repurchases. 

Borrowings under the Credit Facility bear interest at a rate of either (1) the Bank of America’s prime rate plus a margin of 1.50% to 2.75% or (2) the 30, 60, 90 or 180-day LIBOR rate plus a margin of 2.50% to 3.75%, with the margin determined by our consolidated leverage ratio.  In 2012 and 2011, our effective average interest rate for borrowings was 3.4% and 3.3%, respectively.  As of December 31, 2012, our interest rate was 2.7%.  The Credit Facility is secured by substantially all of our assets, excluding real property.  The Credit Facility requires us to maintain certain financial ratios and other financial conditions and prohibits us from making certain investments, advances, cash dividends or loans, and limits incurrence of additional indebtedness and liens.  As of December 31, 2012, we were in compliance with those covenants.  

As of December 31, 2012, we had $18.0 million in outstanding borrowings and unused available borrowing capacity of $126.1 million under the Credit Facility.  In addition, as of December 31, 2012, we had outstanding letters of credit totaling $5.9 million. Some of our customers, primarily those for our property appraisal services, require that we obtain performance bonds in connection with our contracts.  The maximum potential amount of an outstanding performance bond would be the remaining cost of work to be performed under our contracts.  The notional amount of performance guarantees outstanding as of December 31, 2012 was estimated to be $35.1 million.  We provide letters of credit as security for the issuance of performance bonds.    These letters of credit are issued under our revolving line of credit and  reduce our available borrowing capacity.  We do not believe these letters of credit will be required to be drawn upon.  These letters of credit expire in 2013.

We paid interest of $2.0 million in 2012 and $1.9 million in 2011.