Physicians Formula Holdings, Inc. (NASDAQ: FACE) (“Physicians Formula”
or the “Company”) today announced that Physicians Formula, Inc., the
Company’s wholly-owned subsidiary, has entered into a third amendment to
its existing senior credit agreement with Union Bank of California, N.A.
(the “Amendment”).
The Amendment, dated as of December 5, 2008, increases the size of the
revolving credit facility to $25 million from $20 million. The
applicable interest rates on the revolving credit facility remain the
same at LIBOR plus 1.75% or a base rate plus 0.25%.
As of September 30, 2008, the Company had $2 million of outstanding
indebtedness under its revolving credit facility, no letters of credit
and $18 million available for borrowing under its revolving credit
facility and $11.3 million of borrowings under the term loan facility.
The Amendment also amends the maximum total leverage ratio covenant and
the minimum net worth covenant, and imposes a condition that any time
the Company makes a repurchase of common stock, it must have minimum
availability under its revolving credit facility after giving effect to
the repurchase.
“We are very pleased to have successfully expanded our credit agreement
in the current credit market environment and believe this underscores
the confidence our lenders have in our business platform and ability to
execute on our future strategies,” said Joseph Jaeger, Chief Financial
Officer of Physicians Formula. “This increase combined with our expected
future operating cash flow will provide additional financial flexibility
for the future.”
About Physicians Formula Holdings, Inc.
Physicians Formula is one of the fastest growing cosmetics companies
operating in the mass market prestige, or "masstige", market. Under its
Physicians Formula brand name, created in 1937, the Company develops,
markets and distributes innovative, premium-priced products for the mass
market channel. Physicians Formula differentiates itself by addressing
skin imperfections through a problem-solving approach, rather than
focusing on changing fashion trends. Currently, Physicians Formula
products are sold in approximately 27,000 stores throughout the U.S.
including stores operated by Wal-Mart, Target, CVS, Walgreens and Kroger.
Safe Harbor Statement
This press release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended.
