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Bank Line Of Credit
6 Months Ended
Jun. 30, 2011
Bank Line Of Credit  
Bank Line Of Credit

6. Bank Line of Credit

 

On February 28, 2010, the Company amended its existing revolving line of credit agreement with Comerica Bank. The maximum that can be borrowed under the agreement is $7.5 million. The line expires on December 31, 2011.

 

Borrowing under the line of credit bears interest at a "daily adjusting LIBOR rate". Borrowings under the line are subject to reporting covenants requiring the provision of financial statements to Comerica, and, as amended, financial covenants requiring the Company to maintain a minimum adjusted quick ratio of 1.15 and positive net worth. The agreement includes a letter of credit sublimit not to exceed $1.0 million. At June 30, 2011, the Company had an outstanding letter of credit for $103,000. There were no borrowings outstanding on the line of credit at June 30, 2011, and the Company was in compliance with all its covenants.