6 .	Revolving Credit Facility

The Company has a

five

-year revolving credit facility (“Revolver”) with

aximum borrowings totaling

$400,000,000

from

April

through

July

and

$500,000,000

from

August

through

March

and the Revolver matures on

July 5, 2021.

The Revolver balance as of

December 29, 2018

was

$214,161,000

and is included in Current Portion of Long-Term Debt in the accompanying Condensed Consolidated Balance Sheet

The Company utilizes its Revolver for general corporate purposes, including seasonal working capital needs, to pay debt principal and interest obligations, and to fund capital expenditures and acquisitions. Seasonal working capital needs are affected by the growing cycles of the vegetables and fruits the Company processes. The majority of vegetable and fruit inventories are produced during the months of

June

through

November

and are then sold over the following year. Payment terms for vegetable and fruit produce are generally

three

months but can vary from a few days to

seven

months. Accordingly, the Company’s need to draw on the Revolver

may

fluctuate significantly throughout the year.

The Company also has a

$100

million unsecured term loan with Farm Credit which was in violation of an interest ratio covenant requirement at the balance sheet date, but the Company obtained a waiver for the quarter ended

December 29, 2018.

A more restrictive covenant must be met at

March 31, 2019

and it is probable that the Company will fail to meet that requirement at that date as well unless an additional waiver or amendment is obtained. Therefore, the Company concluded that the Farm Credit term loan, as of

December 29, 2018,

should be classified as a current liability. In addition, the Revolver agreement contains a cross-default provision. The Revolver agreement has triggered an event of default as of

December 29, 2018,

due to the Farm Credit loan default. A waiver was obtained from the lender to provide temporary relief of default as of this measurement date. However, the Company believes that it is probable that the Revolver will be in default as of

March 31, 2019

given the likelihood of a Farm Credit default again thus triggering a cross-default. Therefore, the Company concluded that the Revolver should be classified as a current liability as of

December 29, 2018.

The decrease in the reported end of period amount of Revolver borrowings during the

first

nine

months of fiscal

2019

compared to the

first

nine

months of fiscal

2018

was attributable to Working Capital which is

$390,538,000

(

$181,953,000

excluding the Revolver reclassification to current) lower than the same period last year due to the Modesto disposal, partially offset by a net loss in the last

twelve

months ended

December 29, 2018.

General terms of the Revolver include payment of interest at LIBOR plus a defined spread.

The following table documents the quantitative data for Revolver borrowings during the

third

quarter and year-to-date of fiscal

2019

and fiscal

2018:

	Third Quarter						Year-to-Date
	2019			2018			2019			2018
	(In thousands)						(In thousands)
Reported end of period:
Outstanding borrowings	$	214,161		$	290,196		$	214,161		$	290,196
Weighted average interest rate		4.02	%		3.04	%		4.02	%		3.04	%
Reported during the period:
Maximum amount of borrowings	$	242,947		$	296,088		$	294,062		$	296,088
Average outstanding borrowings	$	192,323		$	280,960		$	225,345		$	246,414
Weighted average interest rate		3.86	%		2.82	%		3.64	%		2.59	%