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Note 12 - Long-Term Debt | 9 Months Ended
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Mar. 30, 2014
Disclosure Text Block [Abstract] |
Long-term Debt [Text Block] | 12. Long-Term Debt Debt Obligations The following table presents the total balances outstanding for the Company’s debt obligations, their scheduled maturity dates and the weighted average interest rate for borrowings (including the effects of an interest rate swap) as well as the applicable current portion of long-term debt:
|  | Scheduled |  |  | Weighted Average Interest Rate as of |  |  | Principal Amounts as of |
|  | Maturity Date |  |  | March 30, 2014 |  |  | March 30, 2014 |  |  | June 30, 2013 |
ABL Revolver |  | March 2019 |  |  |  | 3.4% |  |  | $ | 25,400 |  |  | $ | 52,500 |
ABL Term Loan |  | March 2019 |  |  |  | 3.1% |  |  |  | 68,000 |  |  |  | 42,800 |
Term loan from unconsolidated affiliate |  | August 2015 |  |  |  | 3.0% |  |  |  | 1,250 |  |  |  | 1,250 |
Capital lease obligations |  |  |  | (1) |  |  |  | (2) |  |  | 3,861 |  |  |  | 1,203 |
Total debt |  |  |  |  |  |  |  |  |  |  | 98,511 |  |  |  | 97,753 |
Current portion of long-term debt |  |  |  |  |  |  |  |  |  |  | (4,905 | ) |  |  | (65 | )
Total long-term debt |  |  |  |  |  |  |  |  |  | $ | 93,606 |  |  | $ | 97,688 |
| (1) | Scheduled maturity dates for capital lease obligations range from January 2017 to November 2027.
| (2) | Fixed interest rates for capital lease obligations range from 2.3% to 4.6%.
ABL Facility On May 24, 2012, the Company entered into a credit agreement (the “Credit Agreement”) to establish a $150,000 senior secured credit facility (“ABL Facility”) with Wells Fargo Bank, N.A. and Bank of America, N.A. In addition, the Company entered into a $30,000 term loan (“Term B Loan”) which was repaid on January 8, 2013. The Company entered into a First Amendment to Credit Agreement on December 27, 2012, a Second Amendment to Credit Agreement on June 25, 2013, a Third Amendment to Credit Agreement on January 16, 2014 (the “Third Amendment”), and a Fourth Amendment to Credit Agreement on March 28, 2014 (the “Fourth Amendment”). The ABL Facility, as amended, has a maturity date of March 28, 2019, and consists of a $100,000 revolving credit facility (“ABL Revolver”) and a $68,000 term loan (“ABL Term Loan”). The Third Amendment, among other things: (i) revised the definition of permitted indebtedness to allow the Company to enter into permitted sales and leaseback transactions of equipment in an aggregate amount not to exceed $4,000 per fiscal year; (ii) revised the definition of permitted dispositions to increase the amount of certain asset sales or dispositions from $500 to $4,000 per fiscal year; and (iii) revised the mandatory prepayment provision to increase the amount of net proceeds received from certain permitted dispositions that would be required to prepay the outstanding ABL Facility debt from $500 to $4,000 per fiscal year. No amendment fee was required. The Fourth Amendment, among other things: (i) increased the ABL Term Loan by $18,000 to $68,000; (ii) beginning October 1, 2014, requires $2,125 of fixed quarterly payments on the ABL Term Loan; (iii) extended the maturity date of the ABL Facility from May 24, 2018 to March 28, 2019; (iv) modified the calculation of the fixed charge coverage ratio to exclude certain capital expenditures, at the election of the Company, through June 30, 2015, subject to a maximum exclusion of $18,000 for any consecutive twelve month period and other limitations; and (v) modified the definition of the “Trigger Level”, such that it is reached when excess availability under the ABL Revolver falls below the greater of $10,000, 20% of the maximum revolver amount or 12.5% of the sum of the maximum revolver amount plus the outstanding principal amount of the ABL Term Loan. In connection with the Fourth Amendment, $327 of debt financing fees was recorded and will be amortized through the ABL Facility maturity date. The ABL Facility is secured by a first-priority security interest in substantially all property and assets of Unifi, Inc., Unifi Manufacturing, Inc. and certain subsidiary guarantors (the “Loan Parties”). It is also secured by a first-priority security interest in all (or 65% in the case of first tier controlled foreign corporations) 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, together with all proceeds and products thereof. The ABL Facility is further secured by a first-priority lien on the Company’s limited liability company membership interest in Parkdale America, LLC (“PAL”). The Credit Agreement, as amended, includes representations and warranties 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 Trigger Level, 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 becomes effective. The Trigger Level as of March 30, 2014 was $21,000. In addition, the ABL Facility contains restrictions on certain payments and investments, including restrictions on the payment of dividends and share repurchases, unless excess availability is greater than the Trigger Level for the thirty day period prior to the making of such a distribution (as calculated on a pro forma basis as if the payment and any revolving loans made in connection therewith were made on the first day of such period). The Company’s ability to borrow under the ABL Revolver is limited to a borrowing base equal to specified percentages of eligible accounts receivable and inventory and is subject to certain conditions and limitations. ABL Revolver borrowings bear interest at the London Interbank Offer Rate (“LIBOR”) plus an applicable margin of 1.75% to 2.25%, or the Base Rate plus an applicable margin of 0.75% to 1.25%, with interest currently being paid on a monthly basis. The applicable margin is based on the average quarterly excess availability under the ABL Revolver. The Base Rate means the greater of (i) the prime lending rate as publicly announced from time to time by Wells Fargo, (ii) the Federal Funds Rate plus 0.5%, and (iii) LIBOR plus 1.0%. There is also a monthly unused line fee under the ABL Revolver of 0.25% to 0.375% of the unused line amount. The ABL Term Loan bears interest at LIBOR plus an applicable margin of 2.25%, or the Base Rate plus an applicable margin of 1.25%, with interest currently being paid on a monthly basis. Subject to certain provisions, 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. Under the terms of the ABL Facility, the Company is required to hedge at least $50,000 of variable interest rate exposure so long as the outstanding principal of all indebtedness having variable rates of interest exceeds $75,000. As of March 30, 2014, the Company was in compliance with all financial covenants, the excess availability under the ABL Revolver was $62,740, the fixed charge coverage ratio was 7.64 to 1.0 and the Company had $2,325 of standby letters of credit, none of which have been drawn upon. Term Loan from Unconsolidated Affiliate On August 30, 2012, a foreign subsidiary of the Company entered into an unsecured loan agreement for $1,250 with its unconsolidated affiliate, U.N.F. Industries Ltd. The loan bears interest at 3%, payable semi-annually, and does not amortize. The maturity date has been extended from August 30, 2014 to August 30, 2015, at which time the entire principal balance is due. Accordingly, $1,250 has been recorded in long-term debt as of March 30, 2014. Capital Lease Obligations On November 19, 2012, the Company entered into a capital lease with Salem Leasing Corporation for certain transportation equipment. The original amount due under the fifteen year term of the lease is $1,234 and payments are made monthly. The implicit annual interest rate under the lease is approximately 4.6%. During the three months ended March 30, 2014, the Company entered into three capital leases with an unrelated third party for certain machinery and equipment, with original amounts due of $2,800. Scheduled Debt Maturities The following table presents the scheduled maturities of the Company’s outstanding debt obligations for the remainder of fiscal year 2014 and the fiscal years thereafter:
|  | Scheduled Maturities on a Fiscal Year Basis |  |  |  |  |
|  | 2014 |  |  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | Thereafter |
ABL Revolver |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 25,400 |
ABL Term Loan |  |  | — |  |  |  | 6,375 |  |  |  | 8,500 |  |  |  | 8,500 |  |  |  | 8,500 |  |  |  | 36,125 |
Term loan from unconsolidated affiliate |  |  | — |  |  |  | — |  |  |  | 1,250 |  |  |  | — |  |  |  | — |  |  |  | — |
Capital lease obligations |  |  | 162 |  |  |  | 661 |  |  |  | 681 |  |  |  | 634 |  |  |  | 558 |  |  |  | 1,165 |
Total debt |  | $ | 162 |  |  | $ | 7,036 |  |  | $ | 10,431 |  |  | $ | 9,134 |  |  | $ | 9,058 |  |  | $ | 62,690 |
Debt Financing Fees Debt financing fees are classified within other non-current assets and consist of the following:
|  | March 30, 2014 |
Balance at beginning of year |  | $ | 2,117 |
Amounts recorded related to debt modification |  |  | 330 |
Amortization charged to interest expense |  |  | (317 | )
Balance at end of period |  | $ | 2,130 |
Interest Expense Interest expense consists of the following:
|  | For the Three Months Ended |  |  | For the Nine Months Ended |
|  | March 30, 2014 |  |  | March 24, 2013 |  |  | March 30, 2014 |  |  | March 24, 2013 |
Interest on ABL Facility |  | $ | 785 |  |  | $ | 1,007 |  |  | $ | 2,450 |  |  | $ | 2,747 |
Interest on Term B Loan |  |  | — |  |  |  | 43 |  |  |  | — |  |  |  | 722 |
Amortization of debt financing fees |  |  | 105 |  |  |  | 157 |  |  |  | 317 |  |  |  | 486 |
Marked to market adjustment for interest rate swap |  |  | (99 | ) |  |  | (103 | ) |  |  | (107 | ) |  |  | (177 | )
Reclassification adjustment for interest rate swap |  |  | 133 |  |  |  | 106 |  |  |  | 433 |  |  |  | 198 |
Interest capitalized to property, plant and equipment, net |  |  | (39 | ) |  |  | — |  |  |  | (122 | ) |  |  | — |
Other |  |  | 77 |  |  |  | 26 |  |  |  | 146 |  |  |  | 65 |
Total interest expense |  | $ | 962 |  |  | $ | 1,236 |  |  | $ | 3,117 |  |  | $ | 4,041 |
Loss on Extinguishment of Debt The components of loss on extinguishment of debt consist of the following:
|  | For the Three Months Ended |  |  | For the Nine Months Ended |
|  | March 30, 2014 |  |  | March 24, 2013 |  |  | March 30, 2014 |  |  | March 24, 2013 |
Prepayment call premium and other costs for Term B Loan |  | $ | — |  |  | $ | 470 |  |  | $ | — |  |  | $ | 671 |
Non-cash charges due to write-off of debt financing fees |  |  | — |  |  |  | 276 |  |  |  | — |  |  |  | 431 |
Loss on extinguishment of debt |  | $ | — |  |  | $ | 746 |  |  | $ | — |  |  | $ | 1,102 |

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- Definition The entire disclosure for long-term debt. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 22 -Article 5 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 210 -SubTopic 10 -Section S99 -Paragraph 1 -Subparagraph (SX 210.5-02.22) -URI http://asc.fasb.org/extlink&oid=6877327&loc=d3e13212-122682 + Details
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