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Financing Agreements
 12 Months Ended
Apr. 28, 2012
Financing Agreements [Abstract]  
Financing Agreements
Financing Agreements

We have a credit agreement with a U.S. bank that provides for a $35.0 million line of credit and includes up to $15.0 million for standby letters of credit.  The line of credit is due on November 15, 2012. The interest rate ranges from LIBOR plus 125 basis points to LIBOR plus 175 basis points depending on the ratio of interest-bearing debt to EBITDA.  EBITDA is defined as net income before income taxes, interest expense, depreciation and amortization.  The effective interest rate was 1.5 percent at April 28, 2012.  We are assessed a loan fee equal to 0.125 percent per annum of any non-used portion of the loan.  As of April 28, 2012, there were no advances under the line of credit.

The credit agreement is unsecured.  In addition to provisions that limit dividends to the current year net profits after tax, the credit agreement also requires us to be in compliance with the following financial ratios:

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A minimum fixed charge coverage ratio of 2 to 1 at the end of any fiscal year.  The ratio is equal to (a) EBITDA less dividends, a capital expenditure reserve of $6.0 million, and income tax expense, over (b) all principal and interest payments with respect to debt, excluding debt outstanding on the line of credit, and
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A ratio of interest-bearing debt, excluding any marketing obligations, to EBITDA of less than 1 to 1 at the end of any fiscal quarter.

We have an additional credit agreement with another U.S. bank that expires on November 15, 2012 that is intended to support our credit needs outside of the U.S., primarily in China and Europe.  The facility provides for a $20.0 million line of credit and includes facilities to issue up to $20.0 million for letters of credit and bank guarantees and to secure foreign loans.  This U.S. credit facility secured the credit facility that we entered into in China with a Chinese affiliate of the U.S. bank.  It is also expected to secure another facility in Europe to be used to issue credit enhancements as required under our contracts with our customers.  The U.S. credit agreement is unsecured and is cross collateralized with the $35.0 million line of credit described above.  It contains the same covenants as the credit agreement for that line of credit.  As of April 28, 2012, there was $1.5 million of advances outstanding under the China credit facility.

We were in compliance with all applicable covenants as of April 28, 2012.  The special dividends paid on October 14, 2010 and December 22, 2011 were excluded from the computation of the fixed charge coverage ratio and are not subject to the limitations on dividends set forth in the credit agreement.  The minimum fixed charge coverage ratio as of April 28, 2012 was 45-to-1, and the ratio of interest-bearing debt to EBITDA as of April 28, 2012 was approximately 0.08-to-1.