We expect to experience continued growth in our working capital requirements and
capital expenditures as we continue to expand our business. Our long-term future
capital requirements will depend on many factors, including our level of
revenues, the timing and extent of spending to support our product development
efforts, the expansion of sales and marketing activities, the timing of our
introductions of new products, the costs to ensure access to adequate
manufacturing capacity and the continuing market acceptance of our products. We
intend to fund this continued expansion through cash generated by operations and
by drawing on the revolving credit facility or through other debt financing.
However we cannot be certain whether such financing will be available on
commercially reasonable or otherwise favorable terms or that such financing will
be available at all. We anticipate that working capital and capital expenditures
will constitute a material use of our cash resources and that we will either
extend our current credit facilities or obtain alternative credit facilities.
Assuming we are successful in extending our credit facility or entering into
alternative facilities, we have sufficient cash on hand to continue to operate
for at least the next 12 months.
Other factors affecting liquidity and capital resources
Activities under Revolving Lines of Credit and Term Loans
Bank of America In
October 2011, we entered into an amendment to our existing credit agreement with Bank of America, N.A. (" Bank of America") which provided for (i) a $40.0 millionrevolving line of credit facility through June 15, 2013and (ii) a five-year $14.0 millionterm loan facility. The term loan is secured by the three buildings purchased in San Jose, Californiain June 2010and the principal and interest are payable monthly through September 30, 2016with an interest rate at the LIBOR rate plus 1.50% per annum. In June and August 2013, we extended the revolving line of credit to mature on August and September 15, 2013, respectively, and we are currently negotiating with Bank of America to renew the revolving line of credit. The line of credit facility provided for borrowings denominated both in U.S. dollars and in Taiwanese dollars. For borrowings denominated in U.S. dollars, the interest rate for the revolving line of credit is at the LIBOR rate plus 1.25% per annum. The LIBOR rate was 0.19% at June 30, 2013. For borrowings denominated in Taiwanese dollars, the interest rate for the revolving line of credit is equal to the lender's established interest rate which is adjusted monthly. As of June 30, 2013and 2012, the total outstanding borrowings under the Bank of America term loan was $9.3 millionand $12.1 million, respectively. The total outstanding borrowings under the Bank of America line of credit was $10.9 millionand $10.6 millionas of June 30, 2013and 2012, respectively. The interest rates for these loans ranged from 1.23% to 1.69% per annum at June 30, 2013and 1.29% to 1.81% per annum at June 30, 2012, respectively. As of June 30, 2013, the unused revolving line of credit under Bank of America was $29.1 million.