Line of Credit
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6 Months Ended | ||
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Jun. 30, 2012
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Line of Credit [Abstract] | |||
Line of Credit |
We have a revolving line of credit agreement with a financial institution with a current expiration date of November 16, 2012. The credit agreement permits borrowings up to the lesser of $15 million or our borrowing base which is calculated based upon the collateral value of our accounts receivable, inventory, and certain property and equipment. Borrowings under this agreement bear interest at the prime rate, provided, however, that at no time will the rate be less than 4.25% per annum. Borrowings are secured by a pledge of certain of our assets, and the agreement contains various financial covenants, including covenants requiring compliance with certain financial ratios. At June 30, 2012, we had $14.0 million of outstanding borrowings under this agreement and another $0.5 million was reserved for outstanding letters of credit. On August 1, 2012, in conjunction with our entering into a new revolving credit and security agreement with a different financial institution, we repaid all the outstanding borrowings and terminated this credit agreement. See Note 13. Subsequent Events.
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