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DEBT | 3 Months Ended
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Jan. 31, 2021
DEBT [Abstract] |
DEBT | NOTE 6 - DEBT Short-term debt was $0.0 million, and $4.7 million as of January 31, 2021 and October 31, 2020, respectively. The weighted-average interest rate on our short-term debt as of October 31, 2020 was 2.02%. The tables below provide information on our long-term debt.
As of January 31, 2021 |  | Xiamen Project Loans |  |  | Xiamen Working Capital Loans |  |  | Hefei Equipment Loan |  |  | Finance Lease |  |  | Total |
Principal due: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Next 12 months |  | $ | 6,961 |  |  | $ | 8,861 |  |  | $ | - |  |  | $ | 5,819 |  |  | $ | 21,641 |
Months 13 – 24 |  | $ | 10,055 |  |  | $ | 990 |  |  | $ | 4,641 |  |  | $ | 5,445 |  |  | $ | 21,131 |
Months 25 – 36 |  |  | 10,055 |  |  |  | 3,465 |  |  |  | 1,701 |  |  |  | 5,509 |  |  |  | 20,730 |
Months 37 – 48 |  |  | 10,055 |  |  |  | - |  |  |  | - |  |  |  | 18,787 |  |  |  | 28,842 |
Months 49 – 60 |  |  | 9,281 |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | 9,281 |
Thereafter |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |  |  |  | - |
Long-term debt |  | $ | 39,446 |  |  | $ | 4,455 |  |  | $ | 6,342 |  |  | $ | 29,741 |  |  | $ | 79,984 |
Interest rate at balance sheet date |  |  | 4.90 | % |  |  | 4.53% - 4.61 | % |  |  | 4.20 | % |  |  | 1.14 | % |  |  |  |
Basis spread on interest rates |  |  | 25.00 |  |  |  | 67.75 - 76.00 |  |  |  | (45.00 | ) |  |  | N/A |  |  |  |  |
Interest rate reset |  | Quarterly |  |  | Monthly/Annually |  |  | Annually |  |  |  | N/A |  |  |  |  |
Maturity date |  | December 2025 |  |  | July 2023 |  |  | September 2026 |  |  | December 2024 |  |  |  |  |
Periodic payment amount |  | Increases as loans mature |  |  | Increases as loans mature |  |  | Varies (1) |  |  | Varies (3) |  |  |  |  |
Periodic payment frequency |  | Semiannual, on individual loans |  |  | Semiannual, on individual loans |  |  | Semiannual(2) |  |  | Monthly |  |  |  |  |
Loan collateral (carrying amount) |  | $ | 95,703 |  |  |  | N/A |  |  | $ | 89,799 |  |  | $ | 35,560 | (4) |  |  |  |
(1) First five loan repayments will each be for 7.5 percent of the approved 200 million RMB loan principal; last five installments will each be for 12.5 percent of the approved loan principal. (2) Semiannual repayments commence in March 2022. (3) See Note 8 for periodic payment amounts. (4) Amount represents the carrying amount of the related right-of-use asset, in which the lessor has a secured interest.
As of October 31, 2020 |  | Xiamen Project Loans |  |  | Xiamen Working Capital Loans |  |  | Total |
Principal due: |  |  |  |  |  |  |  |  |
Next 12 months |  | $ | 6,705 |  |  | $ | 2,265 |  |  | $ | 8,970 |
Months 13 – 24 |  | $ | 7,334 |  |  | $ | 7,808 |  |  | $ | 15,142 |
Months 25 – 36 |  |  | 9,592 |  |  |  | 3,814 |  |  |  | 13,406 |
Months 37 – 48 |  |  | 9,789 |  |  |  | - |  |  |  | 9,789 |
Months 49 – 60 |  |  | 9,432 |  |  |  | - |  |  |  | 9,432 |
Thereafter |  |  | 7,211 |  |  |  | - |  |  |  | 7,211 |
Long-term debt |  | $ | 43,358 |  |  | $ | 11,622 |  |  | $ | 54,980 |
Interest rate at balance sheet date |  |  | 4.90 | % |  |  | 4.53% - 4.61 | % |  |  |  |
Basis spread on interest rates |  |  | 25.00 |  |  |  | 40.00 - 76.00 |  |  |  |  |
Loan collateral (carrying amount) |  | $ | 94,459 |  |  |  | N/A |  |  |  |  |
Xiamen Project Loans In November 2018, PDMCX was approved for credit of 345 million RMB (approximately $53.4 million, at the balance sheet date), subject to certain limitations related to PDMCX registered capital at the time of the initial approval, pursuant to which PDMCX has and will enter into separate loan agreements (“the Project Loans”) for intermittent borrowings. The Project Loans, which are denominated in RMB, are being used to finance certain capital expenditures for our Xiamen, China facility. PDMCX granted liens on its land use right, building, and certain equipment as collateral for the Project Loans. As of January 31, 2021, PDMCX had outstanding borrowings of 300.0 million RMB ($46.4 million) against this approval. The interest rates on the Project Loans are variable, and based on the RMB Loan Prime Rate of the National Interbank Funding Center. Interest incurred on the loans is eligible for reimbursement through incentives provided by the Xiamen Torch Hi-Tech Industrial Development Zone, which provide for such reimbursements up to a prescribed limit. Xiamen Working Capital Loans In November 2018, PDMCX was approved for revolving, unsecured credit of the equivalent of $25.0 million, pursuant to which PDMCX may enter into separate loan agreements with varying terms to maturity. Under this credit agreement (the “Working Capital Loans”), PDMCX can borrow up to 140.0 million RMB to pay value-added taxes (“VAT”), and up to 60.0 million RMB to fund operations; combined total borrowings are limited to the equivalent of $25.0 million. As of January 31, 2021, PDMCX had 86.1 million RMB ($13.3 million) outstanding against the approval to pay VAT and no outstanding borrowings against the approval to fund operations. The interest rates on the approval to pay VAT are variable, based on the RMB Loan Prime Rate of the National Interbank Funding Center. Interest incurred on the VAT loans are eligible for reimbursement through incentives provided by the Xiamen Torch Hi-Tech Industrial Development Zone, which provide for such reimbursements up to a prescribed limit. Hefei Equipment Loan In October 2020, our Hefei facility was approved to borrow 200 million RMB (approximately $30.9 million, at the balance sheet date) from the China Construction Bank Corporation. Loan proceeds have been, and will be, used to fund the purchases of two lithography tools at our facility in Hefei, China. As of January 31, 2021, we had 41.0 million RMB ($6.3 million) outstanding against this approval. The interest rate on the loan is variable and based on the RMB Loan Prime Rate of the National Interbank Funding Center. The borrowings are secured by the Hefei facility, its related land use right, and certain manufacturing equipment. The Hefei Equipment Loan has covenants and provisions, certain of which relate to the assets pledged as security for the loan, which we were not in compliance with at January 31, 2021. We obtained waivers from the lender for all instances of noncompliance, but are precluded from borrowing additional funds against this facility until our noncompliance with this provision has been cured. In addition, the loan includes covenants for the ratio of total liabilities to total assets and the ratio of current assets to current liabilities. Finance Lease In December 2020, under a Master Lease Agreement which we entered into effective July 2019, we entered into a $35.6 million lease for a high-end lithography tool. Upon entering into the lease, our prior $3.5 million short-term obligation to the lessor became a portion of this lease liability. See Note 8 for additional information on this lease. Corporate Credit Agreement In September 2018, we entered into a five-year amended and restated credit agreement (the “Credit Agreement”), which has a $50 million borrowing limit, with an expansion capacity to $100 million. The Credit Agreement is secured by substantially all of our assets located in the United States and common stock we own in certain foreign subsidiaries. The Credit Agreement includes covenants around minimum interest coverage ratio, total leverage ratio, and minimum unrestricted cash balance (all of which we were in compliance with at January 31, 2021), and limits the amount of cash dividends, distributions, and redemptions we can pay on our common stock to an aggregate annual amount of $50 million. We had no outstanding borrowings against the Credit Agreement at January 31, 2021, and $50 million was available for borrowing. The interest rate on the Credit Agreement (1.12% at January 31, 2021) is based on our total leverage ratio at LIBOR plus a spread, as defined in the Credit Agreement.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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