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Note 29 - Subsequent Events | 9 Months Ended
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Mar. 25, 2012
Subsequent Events [Text Block] | 29. Subsequent Events On April 24, 2012, the Company entered into a commitment letter for a $150,000 senior secured credit facility (“ABL Facility”) with Wells Fargo Bank, N.A. (“Wells Fargo”) and Bank of America, N.A. The ABL Facility will consist of a $100,000 revolving credit facility (“ABL Revolver”) and a $50,000 term loan (“ABL Term Loan”). Wells Fargo will serve as the administrative agent, sole lead arranger and sole book runner. In addition, the Company entered into a commitment letter with MacKay Shields LLC, a Delaware limited liability company, solely in its capacity as investment adviser or subadviser with investment authority for certain discretionary client accounts, for the incurrence of a $30,000 term loan (“Term B Loan”). Wilmington Trust National Association (“Wilmington Trust”) will serve as the administrative agent under the Term B Loan. The purpose of the ABL Facility and the Term B Loan is to, among other things, refinance the Company’s existing indebtedness including the redemption of the 2014 notes and to repay in full and terminate the existing First Amended Credit Agreement. The ABL Facility and the Term B Loan will become effective on May 24, 2012 (the “Closing Date”) and the ABL Revolver, ABL Term Loan, and Term B Loan each have a maturity date of May 24, 2017. As previously disclosed, the Company called for redemption in full of the $123,722 remaining principal amount of the outstanding 2014 notes at par and announced that it will repay in full and terminate the existing First Amended Credit Agreement, which had an outstanding principal balance of $35,000 as of March 25, 2012. The Company plans to finance these transactions (plus related debt refinancing expenses and fees) by using approximately $22,000 of cash, $60,000 of borrowings under the ABL Revolver, $50,000 of borrowings under the ABL Term Loan and $30,000 of borrowings under the Term B Loan. The ABL Facility will be secured by a first-priority perfected security interest in substantially all owned or hereafter acquired property and assets, together with all proceeds and products thereof, of the Company, Unifi Manufacturing, Inc. and its subsidiary guarantors (the “Loan Parties”) other than the assets to which the Loan Parties have a second-priority lien. It will also be secured by a first priority perfected security interest in all of the stock of (or other ownership interests in) each of the Loan Parties (other than the Company) and certain subsidiaries of the Loan Parties; provided, that only 65% of the stock of (or other ownership interests in) first tier controlled foreign corporations will be pledged, together with all proceeds and products thereof. The ABL Facility will further be secured by a second-priority lien on the Company’s indirect limited liability company membership interest in PAL. The Term B Loan will be secured by a first-priority lien on the Company’s indirect limited liability company membership interest in PAL and a second-priority lien on the ABL Facility first-priority collateral described above. Wells Fargo and Wilmington Trust will enter into an intercreditor agreement (“Intercreditor Agreement”) on May 24, 2012 to confirm the relative priority of their respective security interests. The ABL Facility will include representations and warranties to be made by the Loan Parties, affirmative and negative covenants and events of default that are usual and customary for financings of this type. Should excess availability under the ABL Revolver fall below the greater of $10,000 or 15% of maximum availability under the ABL Revolver, the ABL Facility also contains a financial covenant requiring the Loan Parties to maintain a fixed charge coverage ratio on a monthly basis of at least 1.05 to 1.0. In addition, the ABL Facility contains certain restricted payment and restricted investment provisions. The Term B Loan contains representations and warranties, affirmative and negative, covenants and events of default comparable to those included in the ABL Facility. The Company’s ability to borrow under the ABL Revolver (which under certain circumstances may be increased or decreased) will be limited to a borrowing base equal to specified percentages of eligible accounts receivable and inventory and is subject to certain conditions and limitations. Borrowings under the ABL Revolver will bear interest at rates of either a LIBOR Rate plus an Applicable Margin of 1.75% to 2.25% or the Base Rate plus an Applicable Margin of 0.75% to 1.25%. The “Base Rate” means the greatest of (i) the prime lending rate as publicly announced from time to time by Wells Fargo Bank, N.A., (ii) the Federal Funds Rate plus 0.5%, and (iii) the LIBOR rate plus 1.0%. The “LIBOR Rate” is available for interest periods of one, two, three or six months. The “Applicable Margin” is based on the average quarterly excess availability under the ABL Revolver. There will be an unused line fee under the ABL Revolver of 0.25% to 0.375% of the unused line amount. Under the terms of the ABL Facility, the Company is required to hedge at least $50 million of the variable interest rate exposure (so long as funded debt with variable interest rates exceeds $75 million).The Company will have the ability to request that the borrowing capacity of the ABL Revolver be increased to as much as $150,000, at the discretion of the participating lenders. The ABL Term Loan will be repaid in quarterly installments of $1,800 commencing on September 1, 2012 and continuing on the first day of each December, March, June and September thereafter, together with a final installment of all remaining unpaid principal (and all accrued and unpaid interest) coming due on the maturity date. The ABL Term Loan will bear interest at rates of the LIBOR Rates plus an Applicable Margin of 2.25% to 2.75% or the Base Rate plus an Applicable Margin of 1.25% to 1.75% depending upon the Company’s level of excess borrowing availability. The ABL Term Loan may be prepaid at par, in whole or in part, at any time before the maturity date, at the Company’s discretion, subject to the provisions of the Intercreditor Agreement. The Term B Loan bears interest at a rate of LIBOR plus 7.50% (with a LIBOR floor of 1.25%) with interest payable monthly. The Term B Loan does not amortize and prepayments are only required if PAL after-tax distributions are received by the Company (100% of such distributions up to the first $3,000 and 50% thereafter), the Company sells all or any part of its membership interest in PAL or under certain other circumstances specified within the Intercreditor Agreement described above. The Company may prepay the Term B Loan at any time subject to the Intercreditor Agreement, in whole or in part, with a call premium of 3% during the first year, 2% during the second year, 1% during the third year and at par thereafter. The conditions of the lenders’ obligations to fund the ABL Facility and the Term B Loan include the delivery of all required documents, that no event of default has occurred before or on the Closing Date, that the Company will have at least $22,500 of excess borrowing base availability under the ABL Revolver after the initial extensions of credit and payment of all expenses required to be paid by the Company on the Closing Date and that there has not been the occurrence of any material adverse change. Each of the ABL Facility and the Term B Loan are conditioned upon the consummation and performance of the other. The closings of the ABL Facility and the Term B Loan are also subject to additional customary closing conditions and are expected to fund simultaneously with the redemption of the 2014 notes. The Company evaluated all events and material transactions for potential recognition or disclosure through such time as these statements were filed with the Securities and Exchange Commission and determined there were no other items deemed reportable.

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References No definition available. + Details
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