Company: BRID
Filing Date: 2025-03-07
Form Type: 10-Q
Source: 0001493152-25-009592
Chunk: 70

Company: BRIDGFORD FOODS CORP
Filing Date: 2025-03-07
Form: 10-Q
Item: Part I, Item 8
Chunk 70
---
 
    $-  
    $- 
  
    Equipment note payable: 

    3.68% note due 04/16/27, out of lockout 04/17/22 
     2,609  
     2,786 
  
    Total debt 
     2,609  
     2,786 
  
    Less current debt 
     (1,091) 
     (1,084)
  
    Total long-term debt 
    $1,518  
    $1,702 

Loan
Covenants

The
Wells Fargo Loan Agreements and the credit agreement contain various affirmative and negative covenants that limit the use of funds and
define other provisions of the loans. Material financial covenants are listed below, and the capitalized terms are defined in the applicable
agreements:

    ●
    Total
    Liabilities divided by Tangible Net Worth not greater than 2.0 to 1.0 at each fiscal quarter end, 

    ●
    Quick
    Ratio not less than 1.25 to 1.0 at each fiscal quarter end, and

    ●
    Fixed
    Charge Coverage Ratio not less than 1.25 to 1.0 at each fiscal quarter end.

As
of January 24, 2025, the Company was in violation of the Fixed Charge Coverage Ratio covenant which was subsequently waived for the
fiscal quarter ended January 24, 2025 (per letter dated March 6, 2025).

Recently
issued accounting pronouncements and regulations

In June 2016, the FASB issued ASU No. 2016-13, Financial
Instruments—Credit Losses (ASC 326), which provides guidance on measurement of credit losses on financial instruments. This ASU
adds a current expected credit loss impairment model to GAAP that is based on expected losses rather than incurred losses whereby a broader
range of reasonable and supportable information is required to be utilized in order to derive credit loss estimates. The effective date
of the new guidance as amended by ASU No. 2019-10 is fiscal years beginning after December 15, 2022, including interim periods within
those fiscal years. The adoption of ASU No. 2019-10 did not have a material or significant impact on the Company’s Consolidated
Financial Statements as it has been our policy to estimate and record credit losses on trade