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(8) Line of Credit
3 Months Ended
Mar. 30, 2019
Commitments and Contingencies Disclosure [Abstract]  
(8) Line of Credit

 

(8)       Line of Credit

In early November 2018, the Company renewed its $1.5 million revolving line of credit line with Santander Bank. The agreement will mature on June 30, 2019. The LOC is secured by the accounts receivable and other assets of the Company and has an interest rate of prime plus 100 basis points. Under the terms of the agreement, the Company is required to maintain its operating accounts with Santander Bank. The Company is also subject to certain financial covenants. These include specific earnings levels, targeted current ratios and targeted debt to tangible net worth ratios at the end of subsequent quarters. At March 30, 2019, the net loss for the quarter exceeded the earnings covenant. A waiver to maintain compliance with the loan agreement was obtained on May 13, 2019. Also, at March 30, 2019 the Company had $200 thousand borrowings under this LOC and its borrowing base at the time would have permitted an additional $1.3 million to have been borrowed.