Quarterly report pursuant to Section 13 or 15(d)

Borrowings

 v2.3.0.11
Borrowings
6 Months Ended
Jul. 02, 2011
Borrowings  
Borrowings

9.                                      Borrowings

 

Long-term debt, capital lease and other financing obligations as of July 2, 2011 and January 1, 2011 consist of the following:

 

 

 

July 2,
2011

 

January 1,
2011

 

6.85% mortgage, due in monthly installments of $15, including interest, due January 2013, collateralized by land and building

 

$

—

 

$

1,509

 

Floating rate term loan, due in monthly installments of $21, plus interest, due February 2021, collateralized by land and building

 

2,423

 

—

 

Floating rate term loans, due in monthly installments of $54, including interest, due March 2021, collateralized by equipment

 

4,720

 

—

 

2.75% note, due in monthly installments of $3, including interest, due October 2024, collateralized by equipment

 

454

 

468

 

10.00% note, due in monthly installments of $10, including interest, due December 2014

 

440

 

440

 

7.25% note, due on demand with a maturity date of December 2011

 

—

 

2,100

 

4.00% note, due on demand with no stated maturity date

 

—

 

1,400

 

3.00% note, due February 2011

 

—

 

280

 

Capital leases and other financing obligations

 

522

 

700

 

 

 

8,559

 

6,897

 

Less current maturities

 

1,089

 

4,396

 

 

 

$

7,470

 

$

2,501

 

 

On January 24, 2011, we entered into a $2,550 term loan with PNC Bank to refinance the existing mortgage on our California facility.  The term loan is payable as follows, subject to acceleration upon the occurrence of an event of default or termination of the Revolving Credit Agreement: 119 consecutive monthly principal payments of $21 plus interest commencing on February 1, 2011 and continuing on the first day of each month thereafter followed by a 120th payment of all unpaid principal, interest and fees on January 1, 2021. The term loan is collateralized with our California facility located in Compton, California. The term loan bears interest at PNC Base Rate plus 2.25%, or 1-, 2- or 3-month PNC LIBOR Rate plus 3.25%.  As of July 2, 2011, the interest rate was PNC Base Rate of 3.25% plus 2.25% or 5.50%.  In connection with the $2,550 term loan, we repaid our existing 6.85% mortgage, including prepayment penalties and accrued interest, of $1,544 that resulted in $1,006 of additional borrowings under our Revolving Credit Agreement described in Note 7.

 

On March 10, 2011, ARCA Advanced Processing, LLC entered into three separate commercial term loans (“Term Loans”) with Susquehanna Bank, pursuant to the guidelines of the U.S. Small Business Administration 7(a) Loan Program.  The total amount of the Term Loans is $4,750, split into three separate loans for $2,100; $1,400; and $1,250.  AAP repaid $3,780 of short-term debt and repaid $443 to ARCA for loans that were eliminated in the consolidated financial statements. The Term Loan matures in ten years and bears an interest rate of Prime plus 2.75%.  As of July 2, 2011, the interest rate was 6.00%. The total monthly interest and principal payments are $54 and begin on July 1, 2011.  AAP paid interest only between March 10, 2011 and June 30, 2011.  Borrowings under the Term Loans are secured by substantially all of the assets of AAP along with liens on the business assets and certain personal assets of the owners of 4301 Operations, LLC. We are a guarantor of the Term Loans along with 4301 Operations, LLC and its owners.

 

On December 13, 2010, we guaranteed a 3.00% note, due in February 2011, of $280 between Central Bank and AAP.  The guarantee was provided by pledging $280 of our cash balance at Central Bank until the loan was repaid by AAP.  The loan was repaid by AAP on March 10, 2011 as described above.

 

Capital leases and other financing obligations:  We acquire certain equipment under capital leases and other financing obligations.  The cost of the equipment was approximately $1,767 and $1,660 at July 2, 2011 and January 1, 2011, respectively.  Accumulated amortization at July 2, 2011 and January 1, 2011 was approximately $1,356 and $1,192, respectively.  Depreciation and amortization expense is included in cost of revenues and selling, general and administrative expenses.