Optical Cable Corporation Extends and Restructures Bank Financing
ROANOKE, Va., April 1 /PRNewswire-FirstCall/ -- Optical Cable Corporation (Nasdaq: OCCF - news) today announced that Wachovia Bank, N.A. (formerly First Union National Bank) has agreed to extend and has arranged to restructure the Company's credit facility.
Wachovia Bank, N.A. has arranged a new three-year credit facility providing up to a maximum of $25.0 million that will replace the Company's current $9.5 million credit facility with the bank. A commitment letter has been issued for the new credit facility, which is expected to close on or before April 30, 2002. The new credit facility is subject to negotiation of a definitive loan agreement. The current facility, which expired March 31, has been extended to April 30, 2002.
``The new line of credit will provide us with additional working capital, as needed, to facilitate future capital requirements and growth,'' stated Neil Wilkin, Acting-President and Chief Financial Officer. ``While we received similar offers from other financial institutions to extend the Company credit, we chose to continue our long-standing and favorable relationship with Wachovia Bank. We appreciate their continued support,'' added Mr. Wilkin.
The new credit facility will be secured by all of the Company's tangible and intangible assets. Borrowings under the new credit facility will be subject to certain coverage ratios, advance limits and qualifications that will be applied to the Company's accounts receivable, inventory and fixed assets. The Company's ability to access the full amount of the new credit facility will depend on the future growth of the Company's borrowing base. The amount of the credit initially available at the time of the closing of the new credit facility is expected to be approximately $11 million.
As of March 31, 2002, the Company's outstanding balance on its current line of credit was $6.3 million, and its cash and cash equivalents on hand was $4.5 million.
Optical Cable Corporation manufactures and markets a broad range of fiber optic cables for ``high bandwidth'' transmission of data, video, and audio communications over short to moderate distances. Optical Cable Corporation's cables can be used both indoors and outdoors and utilize a tight-buffer coating process that protects the optical fiber.
Further information on Optical Cable Corporation is available through our website on the World Wide Web at www.occfiber.com .
FORWARD-LOOKING INFORMATION
This news release may contain certain ``forward-looking'' information within the meaning of the federal securities laws. The forward-looking information may include, among other information, (i) statements concerning Optical Cable Corporation's (the ``Company'') outlook for the future, (ii) statements of belief, (iii) future plans, strategies or anticipated events, and (iv) similar information and statements concerning matters that are not historical facts. Such forward-looking information is subject to risks and uncertainties that may cause actual events to differ materially from the expectations of the Company. Factors that could cause or contribute to such differences include, but are not limited to, the level of sales to key customers or distributors; the economic conditions affecting network service providers; the slowdown in corporate spending on information technology; actions by competitors; fluctuations in the price of raw materials (including optical fiber); the Company's dependence on a single manufacturing facility; the ability of the Company to protect its proprietary manufacturing technology; market conditions influencing prices or pricing; the Company's dependence on a limited number of suppliers; an adverse outcome in litigation, claims and other actions, and potential litigation, claims and other actions against the Company, including, but not limited to, the shareholder litigation that has been filed; the effect of sales of the Company's common stock by the various brokerage firms alleging that the Company's former President and Chief Executive Officer pledged substantially all of his personally-held unregistered shares of the Company to cover personal margin loans; technological changes and introductions of new competing products; the current recession; terrorist attacks or acts of war, particularly given the acts of terrorism against the United States on September 11, 2001 and subsequent military responses by the United States; ability to retain key personnel; changes in market demand; exchange rates; productivity; weather; and market and economic conditions in the areas of the world in which the Company operates and markets its products.
SOURCE: Optical Cable Corporation |
