Company: BRID
Filing Date: 2025-03-07
Form Type: 10-Q
Source: 0001493152-25-009592
Chunk: 34

Company: BRIDGFORD FOODS CORP
Filing Date: 2025-03-07
Form: 10-Q
Item: Part I, Item 1
Chunk 34
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. (collectively referred to as the “Wells Fargo Loan Agreements”).

The
following table reflects major components of our revolving credit facility and equipment note payable as of January 24, 2025, and November
1, 2024, respectively.

    January 24, 2025  
    November 1, 2024 

    Revolving credit facility 
    $-  
    $- 
  
    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