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Notes Payable
3 Months Ended
Mar. 31, 2012
Notes Payable [Abstract]  
Notes Payable

6. Notes Payable

Revolving Credit Agreement

The Company entered into a credit agreement with JP Morgan Chase Bank, N.A. ("Chase") in October 2007. The credit agreement has a maturity date of July 1, 2013. At both March 31, 2012 and December 31, 2011 there were $5.0 million of borrowings outstanding. There was additional borrowing capacity of $2.2 million and $3.7 million at March 31, 2012 and December 31, 2011, respectively. The revolving credit line is $10.0 million with a limit of up to $6.0 million of borrowing in the event that "adjusted net income" is less than $1.00 for any quarter ("Line Limit"). Adjusted net income is defined as domestic operating income plus depreciation and amortization. The agreement is collateralized by the Company's real estate in Houston and Beaumont, Texas, trade accounts receivable, equipment, inventories, and work-in-process, and the Company's U.S. subsidiaries are guarantors of the borrowings.

Under the agreement, the Company pays a commitment fee of 0.3% per annum of the unused portion of the credit limit each quarter. Additionally, the terms of the agreement contain covenants which provide for customary restrictions and limitations, the maintenance of certain financial ratios, including maintenance of a minimum current ratio, leverage ratio and tangible net worth and restriction from paying dividends without prior written consent of the bank. On July 27, 2011, the Company amended its interest rate on the Company borrowings to 30 day LIBOR rate (0. 24% at March 31, 2012) plus 3.25% per annum.

On May 1, 2012, the Company and Chase executed a consent and amendment to the credit agreement to allow for the preferred stock financing as discussed in Note 11. Subsequent Events.