Costar Technologies, Inc. Announces New Credit Facility
04 April 2013 - 12:21AM
OTC Markets
FOR IMMEDIATE RELEASE
CONTACT: Scott Switzer
April 03, 2013
Chief Financial Officer
Costar Technologies, Inc.
(469) 635-6800
Costar
Technologies, Inc. Announces New Credit
Facility
Coppell, Texas – April 03, 2013 – Costar Technologies, Inc.
(the “Company”) (OTC Markets Group: CSTI) announced today that it
has entered into a new credit facility with the BOKF, NA dba Bank
of Texas. The new facility has a significantly lower interest rate
and fees than the Company’s previous facility with Briar Capital,
L.P.
The Company’s
wholly owned subsidiary, Costar Video Systems, LLC (“Costar”),
entered into the new facility with the Bank of Texas. The
facility provides up to $1,000,000 in a revolving line of credit,
with a one year maturity. The facility is secured by a lien on
substantially all of Costar’s accounts receivable, inventory, and
equipment, and the Company is a guarantor of Costar’s obligations
under the facility. Borrowings under the facility accrue interest
at a rate equal to the Bank of Texas prime rate, currently at 4.0%
per annum.
The facility
contains customary representations and warranties, events of
default and covenants, including, among other things, covenants
that restrict the ability of Costar to incur certain additional
indebtedness or issue additional equity interests. The facility
also contains financial covenants calculated on a consolidated
basis requiring the Company to maintain a certain debt service
coverage ratio, minimum profitability and a minimum tangible net
worth.
James Pritchett,
President and Chief Executive Officer of the Company, stated, “Due
to the Company’s improving profits, our new line of credit is more
than sufficient to meet the Company’s cash flow needs. With the
lower interest rate and fees associated with the new loan, the
Company is able to retain flexibility, minimize borrowing costs,
and maximize profitability.”
About Costar
Technologies, Inc.
Costar
Technologies, Inc. develops, designs and distributes a range of
security solution products including surveillance cameras, lenses,
digital video recorders and high-speed domes. The Company also
develops, designs and distributes industrial vision products to
observe repetitive production and assembly lines, thereby
increasing efficiency by detecting faults in the production
process. Headquartered in Coppell, Texas, the Company’s shares
currently trade on the OTC Markets Group under the ticker symbol
“CSTI”.
Cautionary
Statement Regarding Forward Looking
Statements
This document
contains forward-looking statements that involve risks and
uncertainties, as well as assumptions, that if they never
materialize or prove incorrect, could cause the results of the
Company to differ materially from those expressed or implied by
such forward-looking statements. Forward-looking statements
generally are identified by the words “expects,” “anticipates,”
“believes,” “intends,” “estimates,” “should,” “would,” “strategy,”
“plan” and similar expressions. All statements other than
statements of historical fact are statements that could be deemed
forward-looking statements. The risks, uncertainties and
assumptions include developments in the marketplace for our
products, competition, related products and services and general
economic conditions, as well as other risks and uncertainties.
Accordingly, we cannot give assurance that any of the events
anticipated by the forward-looking statements will transpire or
occur, or if any of them do so, what impact they will have on the
results of operations or financial condition of the
Company.
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