Note 10 - Notes Payable and Bank Credit Facility

12 Months Ended

Nov. 25, 2017

Notes to Financial Statements

Debt Disclosure [Text Block]

10

.

Notes Payable and Bank Credit Facility

Our notes payable consist of the following:

	November 25, 2017
	Principal Balance			Unamortized Discount			Net Carrying Amount
Zenith acquisition note payable	$	3,000		$	(13	)	$	2,987
Real estate notes payable		747			-			747
Total debt		3,747			(13	)		3,734
Less current portion		(3,418	)		13			(3,405	)
Total long-term debt	$	329		$	-		$	329

	November 26, 2016
	Principal Balance			Unamortized Discount			Net Carrying Amount
Zenith acquisition note payable	$	6,000		$	(108	)	$	5,892
Real estate notes payable		1,219			-			1,219
Total debt		7,219			(108	)		7,111
Less current portion		(3,385	)		95			(3,290	)
Total long-term debt	$	3,834		$	(13	)	$	3,821

The future maturities of our notes payable are as follows:

Fiscal 2018	$	3,418
Fiscal 2019		329
	$	3,747

Zenith Acquisition Note Payable

As part of the consideration given for our acquisition of Zenith on

February 2, 2015,

we issued a

n unsecured note payable to the former owner in the amount of

$9,000,

payable in

three

annual installments of

$3,000

due on each anniversary of the note, the

first

installment having been paid on

February 2, 2016.

Interest is payable annually at the

one

year LIBOR rate. The note was recorded at its fair value in connection with the acquisition resulting in a debt discount that is amortized to the principal amount through the recognition of non-cash interest expense over the term of the note. Interest expense resulting from the amortization of the discount was

$95,

$204

and

$252

for fiscal

2017,

2016

and

2015,

respectively. The current portion of the note due within

one

year, including unamortized discount, was

$2,987

and

$2,904

at

November 25, 2017

and

November 26, 2016,

respectively.

Real Estate Notes Payable

Two of our retail real estate properties have been financed through commercial mortgages with interest rates of

6.73%.

These mortgages are collateralized by the respective properties with net book values totaling approximately $

5,727

and

$5,858

at

November 25, 2017

and

November 26, 2016,

respectively. The total balance outstanding under these mortgages was

$747

and

$1,219

at

November 25, 2017

and

November 26, 2016,

respectively. The current portion of these mortgages due within

one

year was

$418

and

$385

as of

November 25, 2017

and

November 26, 2016,

respectively.

Fair Value

We believe that the carrying amount of our notes payable approximates fair value at both

November 25, 2017

and

November 26, 2016.

In estimating the fair value, we utilize current market interest rates for similar instruments. The inputs into these fair value calculations reflect our market assumptions and are

not

observable. Consequently, the inputs are considered to be Level

3

as specified in the fair value hierarchy in ASC Topic

820,

Fair Value Measurements and Disclosures

. See Note

4.

Bank Credit Facility

Effective

December 5, 2015,

we entered into a new credit facility with

our bank which provides for a line of credit of up to

$15,000.

This credit facility, which matures in

December

of

2018,

is unsecured and contains covenants requiring us to maintain certain key financial ratios. We are in compliance with all covenants under the facility and expect to remain in compliance for the foreseeable future.

We have $

2,249

outstanding under standby letters of credit against our line, leaving availability under our credit line of

$12,751.

In addition, we have outstanding standby letters of credit with another bank totaling

$511.

Total interest paid during fiscal

201

7,

2016

and

2015

was

$139,

$353

and

$277,

respectively.