Overstock.com 2007 Annual Report Download - page 114

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Overstock.com, Inc.
Notes to Consolidated Financial Statements (Continued)
9. ACCRUED LIABILITIES
Accrued liabilities consist of the following (in thousands):
December 31,
2006 2007
Inventory received but not invoiced $ 243 $ 2,165
Allowance for returns 3,615 5,028
Accrued payroll and other related costs 7,952 10,783
Deferred revenue 2,650 17,357
Accrued marketing expenses 10,835 6,997
Credit card processing fee accrual 818 669
Accrued freight 554 665
Accrued professional expenses 1,410 1,638
Accrued taxes 2,075 486
Lease termination costs 5,949 1,001
Other accrued expenses 4,041 5,809
$40,142 $52,598
10. BORROWINGS
$30.0 million Credit Agreement
The Company has a credit agreement (as amended to date, the "Credit Agreement") with Wells Fargo Bank, National Association ("Wells Fargo"). The
Credit Agreement provides a revolving line of credit to the Company of up to $30.0 million which the Company uses primarily to obtain letters of credit to
support inventory purchases. Interest on borrowings is payable monthly and accrued at either (i) 1.0% above LIBOR in effect on the first day of an applicable
fixed rate term, or (ii) at a fluctuating rate per annum determined by the bank to be one half a percent (0.50%) above daily LIBOR in effect on each business
day a change in daily LIBOR is announced by the bank. The Credit Agreement expires on January 1, 2010, and requires the Company to comply with certain
covenants, including restrictions on mergers, business combinations or transfer of assets.
Borrowings and outstanding letters of credit under the Credit Agreement are required to be completely collateralized by cash balances held at Wells
Fargo Bank, N.A, and therefore the facility does not provide additional liquidity to the Company.
At December 31, 2007, no amounts were outstanding under the Credit Agreement, and letters of credit totaling $2.8 million were issued on behalf of the
Company.
$40.0 million WFRF Agreement
The Company is a party to a Loan and Security Agreement (the "WFRF Agreement") with Wells Fargo Retail Finance, LLC and related security
agreements and other agreements described in the WFRF Agreement.
The WFRF Agreement provides for advances to the Company and for the issuance of letters of credit for its account of up to an aggregate maximum of
$40.0 million. The amount actually available to the Company may be less and may vary from time to time, depending on, among other factors, the
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