Business Context and Reporting Period
Company: Optical Cable Corporation
Filing Type: Form 8-K (Current Report)
Date of Report: May 7, 2015
Event: Entry into a Material Definitive Agreement regarding the renewal of a revolving credit facility with SunTrust Bank.
Key Financial Metrics
- Outstanding Debt: $4.5 million under the Commercial Note.
- Credit Facility Limit: Up to $9.0 million, subject to borrowing base calculations (85% of eligible receivables, 35% of eligible foreign receivables, and 25% of eligible raw materials inventory).
- Interest Rate: LIBOR plus 2.2%.
- Repayment Terms: Interest due monthly; principal and accrued interest due at maturity.
- Liquidity: The facility is designated for working capital needs.
Note: The filing does not provide data on revenue, profit, cash flow, or margins.
Material Changes
- Maturity Extension: The maturity date of the Commercial Note was extended from August 31, 2016, to August 31, 2017, via a Binding Letter of Renewal.
- Security Agreement: The Company entered into an Amended and Restated Security Agreement, replacing the agreement dated April 30, 2010. The new agreement is substantially similar in material aspects to the prior version.
- Terms: All other terms of the Commercial Note remain unaltered.
Outlook, Risks, and Management Commentary
The filing contains no forward-looking guidance, management commentary on future performance, or specific risk factors beyond the standard obligations of the credit agreement. The primary focus is the administrative renewal of existing debt terms to maintain working capital liquidity.
Investor Verification Checklist
- Verify the current borrowing base availability against the $9.0 million cap.
- Confirm the current LIBOR rate to calculate the effective interest cost.
- Review the Amended and Restated Security Agreement (Exhibit 10.2) for any subtle changes in collateral requirements.
- Monitor the company's ability to meet monthly interest payments and the final principal repayment due in August 2017.