Borrowing Arrangements

12 Months Ended

Dec. 31, 2013

Debt Disclosure [Abstract]

BORROWING ARRANGEMENTS

BORROWING ARRANGEMENTS

Under the terms of an unsecured credit facility with Bank of the West, the Company has a $5.0 million line of credit available for general working capital needs, which includes a $5.0 million letter of credit sub-facility including a $2.0 million foreign exchange sub-facility. In April 2013, certain terms of the credit agreement were amended including an extension of the expiration date to April 30, 2014 and the deletion of a minimum effective tangible net worth covenant. Interest rates under the amended agreement are based on one of three interest rates, at the Company’s option: (1) a variable alternate base rate plus 1.0%, the alternate base rate being the greater of (x) Bank of the West’s prime rate, (y) the Fed Funds Rate plus 0.5% or (z) daily adjusted one-month LIBOR plus 1.0%; (2) floating one-month LIBOR plus 2.0% or (3) fixed LIBOR for one, two, three or six month periods, plus 2.0%. The agreement includes certain restrictive covenants and, as of December 31, 2013, the Company was in compliance with such covenants.

The borrowing arrangements include a provision for the issuance of commercial or standby letters of credit by the bank on behalf of the Company. As of December 31, 2013, the Company had $0.3 million in letters of credit outstanding. The letters of credit are issued to guarantee payments for the Company’s workers compensation program. As of December 31, 2013, the Company had no borrowings under the line of credit.

Through the PhaseLink acquisition, the Company acquired two term loans totaling $0.3 million with a local bank in Taiwan. The Company paid off the acquired bank loans in full in June 2012.