vj, you got it dead right. KKD is within 10 mil. of violating debt covenants. While they hold up 5 mil. in prepayment of debt as a good thing, it was necessary to keep the margin of safety they have been attempting to maintain with the covenants. Unfortunately for KKD the ratios they are supposed to beat get tougher as time goes on. Watch for another debt covenant violation over the next few quarters followed by a penalty and increase in interest rates paid.