Credit Facilities And Long-Term Debt

12 Months Ended

May 31, 2014

Credit Facilities And Long-Term Debt [Abstract]

9. Credit Facilities and Long-Term Debt

Long-term debt consisted of the following (in thousands except interest rate and installment data):



	May 31		June 1
	2014		2013

Note payable at 6.20%, due in monthly principal installments of $250,000, plus interest, maturing in 2019	$	16,500	$	19,500
Note payable at 5.99%, due in monthly principal installments of $150,000, plus interest, maturing in 2021		14,500		16,300
Note payable at 6.35%, due in monthly principal installments of $100,000, plus interest, maturing in 2017		11,500		12,700
Series A Senior Secured Notes at 5.45%, due in monthly principal installments of $175,500, plus interest, maturing in 2018		8,417		10,524
Note payable at 5.40%, due in monthly principal installments of $125,000, plus interest, maturing in 2018		6,250		-
Note payable at 6.40%, due in monthly principal installments of $35,000, plus interest, maturing in 2018		3,560		3,980
Note payable at 2.00%, due in semi-annual principal installments of $20,790, plus interest, maturing in 2019		197		-
Note payable at 6.07%, due in monthly principal installments of $33,300, plus interest, maturing in 2015		169		569
Note payable at 6.80%, due in monthly principal installments of $165,000, plus interest, maturing in 2014		-		1,190
Note payable-Texas Egg Products, LLC (payable to non-affiliate equity members)		-		257
Total debt		61,093		65,020
Less: current maturities		10,216		10,373
Long-term debt, less current maturities	$	50,877	$	54,647

The aggregate annual fiscal year maturities of long-term debt at May 31, 2014 are as follows (in thousands):


2015	$	10,216
2016		10,082
2017		20,265
2018		8,439
2019		5,091
Thereafter		7,000
	$	61,093

Certain property, plant, and equipment is pledged as collateral on our notes payable and senior secured notes. Unless otherwise approved by our lenders, we are required by provisions of our loan agreements to (1) maintain minimum levels of working capital (ratio of not less than 1.25 to 1) and net worth (minimum of $90.0 million tangible net worth, plus 45% of cumulative net income); (2) limit dividends paid in any given quarter to not exceed an amount equal to one third of the previous quarter’s consolidated net income (allowed if no events of default), (3) maintain minimum total funded debt to total capitalization (debt to total tangible capitalization not to exceed 55%); and (4) maintain various current and cash-flow coverage ratios (1.25 to 1), among other restrictions. At May 31, 2014, we were in compliance with the financial covenant requirements of all loan agreements. Under certain of the loan agreements, the lenders have the option to require the prepayment of any outstanding borrowings in the event we undergo a change in control, as defined in the applicable loan agreement. Our debt agreements require Fred R. Adams, Jr., the Company’s Founder and Chairman Emeritus, or his family, to maintain ownership of Company shares representing not less than 50% of the outstanding voting power of the Company. In addition, with the acquisition of Delta Egg, we assumed certain debt that contains restrictive covenants. We are in compliance with those covenants at May 31, 2014.

Interest of $3.1 million, $3.9 million, and $4.6 million was paid during fiscal 2014, 2013 and 2012, respectively. Interest of $603,000, $383,000, and $150,000 was capitalized for construction of certain facilities during fiscal 2014, 2013 and 2012, respectively.

- Definition

The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants.

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