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Note 12 - Long-term Debt | 6 Months Ended
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Dec. 28, 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 rates for borrowings (including the effects of the 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 |  |  | December 28, 2014 |  | December 28, 2014 |  |  | June 29, 2014 |
ABL Revolver |  | March 2019 |  |  | 2.2% |  | $ | 19,000 |  |  | $ | 26,000 |
ABL Term Loan |  | March 2019 |  |  | 3.2% |  |  | 87,187 |  |  |  | 68,000 |
Term loan from unconsolidated affiliate |  | August 2015 |  |  | 3.0% |  |  | 1,250 |  |  |  | 1,250 |
Capital lease obligations |  | (1) |  |  | (2) |  |  | 3,821 |  |  |  | 4,238 |
Total debt |  |  |  |  |  |  |  | 111,258 |  |  |  | 99,488 |
Current portion of long-term debt |  |  |  |  |  |  |  | (13,353 | ) |  |  | (7,215 | )
Total long-term debt |  |  |  |  |  |  | $ | 97,905 |  |  | $ | 92,273 |
| (1) | Scheduled maturity dates for capital lease obligations range from January 2017 to November 2027.
| (2) | Interest rates for capital lease obligations range from 2.3% to 4.6%.
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. The ABL Facility has been amended several times, such that it has a maturity date of March 28, 2019 and consists of a $100,000 revolving credit facility (“ABL Revolver”) and a $90,000 term loan (“ABL Term Loan”). ABL Facility The ABL Facility is secured by a first-priority security interest in substantially all owned property and assets (together with proceeds and products) 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 certain first tier controlled foreign corporations, as required by the lenders) 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. If excess availability under the ABL Revolver falls below the defined 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 December 28, 2014 was $23,398. 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 all such payments and any revolving loans made in connection therewith were made on the first day of such period) and the fixed charge coverage ratio is at least 1.0 to 1.0 (as calculated on a pro forma basis as if all such payments made pursuant to the most recent compliance certificate date were made on the last day of the applicable twelve-month period). 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. 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 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%. Fifth Amendment On August 25, 2014, the Company entered into a Fifth Amendment to Credit Agreement (“Fifth Amendment”). The Fifth Amendment, among other things: (i) increased the ABL Term Loan by $22,000 to $90,000; (ii) increased the fixed quarterly payments on the ABL Term Loan from $2,125 to $2,812; (iii) modified the calculation of the fixed charge coverage ratio to exclude certain capital expenditures and permitted acquisitions, at the election of the Company, through June 30, 2015, subject to a maximum exclusion of $40,000 for any consecutive twelve-month period and other limitations; (iv) increased the ABL Term Loan interest rate from LIBOR plus an applicable margin of 2.25%, or the Base Rate plus an applicable margin of 1.25%, to LIBOR plus an applicable margin of 2.50%, or the Base Rate plus an applicable margin of 1.50%; (v) modified the date on which the eligibility of certain collateral is calculated as a date between July 19, 2015 and December 31, 2015, subject to satisfaction of certain additional conditions, such that the ABL Term Loan amount can be increased again up to $90,000; (vi) related to the making of restricted payments (consisting of dividends and share repurchases), in addition to existing requirements, added a requirement to have a fixed charge coverage ratio of at least 1.0 to 1.0 during the same period, calculated on a pro forma basis as if all such restricted payments made pursuant to the most recent compliance certificate date were made on the last day of the applicable twelve-fiscal-month period; and (vii) removed the requirement to hedge interest rate exposure on funded indebtedness. Debt financing fees of $184 were recorded during the six months ended December 28, 2014 related to the amendment. As of December 28, 2014, the Company was in compliance with all financial covenants; the excess availability under the ABL Revolver was $60,919; the fixed charge coverage ratio was 4.5 to 1.0; and the Company had $525 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 under which it borrowed $1,250 from the Company’s unconsolidated affiliate, U.N.F. Industries Ltd. The loan does not amortize and bears interest at 3%, payable semi-annually. The entire principal balance is due August 30, 2015, the maturity date. Scheduled Debt Maturities The following table presents the scheduled maturities of the Company’s outstanding debt obligations for the remainder of fiscal year 2015 and the fiscal years thereafter:
|  | Scheduled Maturities on a Fiscal Year Basis |
|  | 2015 |  |  | 2016 |  |  | 2017 |  |  | 2018 |  |  | 2019 |  |  | Thereafter |
ABL Revolver |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | — |  |  | $ | 19,000 |  |  | $ | — |
ABL Term Loan |  |  | 5,625 |  |  |  | 11,250 |  |  |  | 11,250 |  |  |  | 11,250 |  |  |  | 47,812 |  |  |  | — |
Capital lease obligations |  |  | 423 |  |  |  | 866 |  |  |  | 808 |  |  |  | 558 |  |  |  | 366 |  |  |  | 800 |
Term loan from unconsolidated affiliate |  |  | — |  |  |  | 1,250 |  |  |  | — |  |  |  | — |  |  |  | — |  |  |  | — |
Total |  | $ | 6,048 |  |  | $ | 13,366 |  |  | $ | 12,058 |  |  | $ | 11,808 |  |  | $ | 67,178 |  |  | $ | 800 |
Debt Financing Fees Debt financing fees are classified within other non-current assets and consist of the following:
Balance at June 29, 2014 |  | $ | 2,093 |
Amounts recorded related to debt modification |  |  | 184 |
Amortization charged to interest expense |  |  | (258 | )
Balance at December 28, 2014 |  | $ | 2,019 |
Interest Expense Interest expense consists of the following:
|  | For the Three Months Ended |  |  | For the Six Months Ended |
|  | December 2 8, 201 4 |  |  | December 29, 2013 |  |  | December 2 8, 201 4 |  |  | December 29, 2013 |
Interest on ABL Facility |  | $ | 925 |  |  | $ | 812 |  |  | $ | 1,785 |  |  | $ | 1,665 |
Other |  |  | 43 |  |  |  | 30 |  |  |  | 91 |  |  |  | 69 |
Subtotal |  |  | 968 |  |  |  | 842 |  |  |  | 1,876 |  |  |  | 1,734 |
Reclassification adjustment for cash flow hedge |  |  | 89 |  |  |  | 145 |  |  |  | 193 |  |  |  | 300 |
Amortization of debt financing fees |  |  | 146 |  |  |  | 105 |  |  |  | 258 |  |  |  | 212 |
Mark-to-market adjustment for interest rate swap |  |  | 12 |  |  |  | (148 | ) |  |  | (246 | ) |  |  | (8 | )
Interest capitalized to property, plant and equipment, net |  |  | (6 | ) |  |  | (41 | ) |  |  | (53 | ) |  |  | (83 | )
Subtotal |  |  | 241 |  |  |  | 61 |  |  |  | 152 |  |  |  | 421 |
Total interest expense |  | $ | 1,209 |  |  | $ | 903 |  |  | $ | 2,028 |  |  | $ | 2,155 |

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- Definition The entire disclosure for long-term debt. + References Reference 1: 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 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher SEC -Name Regulation S-X (SX) -Number 210 -Section 02 -Paragraph 22 -Article 5 + Details
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