COPPELL, Texas, July 21, 2009 (GLOBE NEWSWIRE) -- Craftmade International, Inc. (Nasdaq:CRFT) announced that effective July 10, 2009, it completed a $40 million Loan and Security Agreement (the "Revolving Loan Agreement") with Bank of America, N.A. ("Bank of America"). The three-year Revolving Loan Agreement is secured by substantially all of Craftmade's assets, excluding its current real estate holdings. Additionally, Craftmade maintained its long-term relationship with Frost National Bank ("Frost") with a $3.5 million, three-year term loan secured by Woodard's manufacturing and distribution facility in Owosso, Michigan. The proceeds from these loans were used to pay off all amounts owed under Craftmade's previous line of credit with Frost and other lenders.
The Revolving Loan Agreement has an interest rate of LIBOR plus 3% to 4% based on Craftmade's cash flow performance as measured by the Fixed Charge Coverage Ratio. Under the Revolving Loan Agreement, Craftmade is required to maintain a Fixed Charge Coverage Ratio starting at 0.85 and building to 1.0 by August, 2009. The terms allow for a deferral of the Fixed Charge Coverage Ratio test as long as $6 million of available credit under the borrowing base has been maintained for 60 days.
"These loans will provide essential support for our working capital needs during a challenging economic time, and they also expand our banking relationships for the next three years," commented J. Marcus Scrudder, Craftmade's Chief Executive Officer. "Refinancing of our line of credit has been a top priority for the company. We're happy to have established a new banking relationship with Bank of America, while at the same time continuing our long association with Frost."
For more detailed information about these loans, please see the Form 8-K filed by Craftmade with the Securities and Exchange Commission on July 16, 2009.
About Craftmade
Founded in 1985, Craftmade International, Inc. is engaged in the design, manufacturing, distribution and marketing of a broad range of home decor products, including proprietary ceiling fans, lighting products and outdoor furniture. The Company distributes its premium products through a network of independent showrooms and mass retail customers through its headquarters and distribution facility in Coppell, Texas and manufacturing plant in Owosso, Michigan. More information about Craftmade International, Inc. can be found at www.craftmade.com.
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