ELMIRA, N.Y., March 23 /PRNewswire-FirstCall/ -- Hardinge Inc. (Nasdaq: HDNG), a leading global provider of advanced metal-cutting solutions, announced that on March 16, 2009, the Company entered into a new financing arrangement with Manufacturers and Traders Trust Company ("M&T"). Under the new agreement M&T provided the Company a $10 million term loan which is secured by substantially all of the Company's U. S. assets, as well as two thirds of the Company's investment in its foreign subsidiaries. The loan agreement contains no financial covenants.

Proceeds from the term loan were used to repay approximately $8 million of Company indebtedness under a secured credit facility entered into in June 2008. As announced in the Company's year-end earnings release, the Company had violated the fixed charge covenant under that agreement. The June 2008 credit facility has been paid in full and the Company has taken a non-cash charge of approximately $1 million related to deferred financing costs in connection with its termination.

Contemporaneous with the execution of the new term loan with M&T, the Company entered into a commitment letter with M&T for a three- year $25 million revolving credit facility ("Credit Facility"), which when consummated will replace the $10 million term loan with M&T Bank, discussed above. The Company expects to close on the Credit Facility on or before April 30, 2009.

"The term loan announced today is intended to bridge us through the work required to finalize the Credit Facility, which should provide Hardinge with ample liquidity as we manage through this global economic crisis," said Richard L. Simons, President and Chief Executive Officer. "Prior to closing the term loan, we had used cash on hand generated from operating results to reduce the outstanding obligations under the previous facility by $16 million since the end of 2008. The short term financing we have put in place comes with less upfront fees and more favorable terms than an amendment of the previous facility would have entailed. As of today, we also have approximately $8 million of cash on hand to handle day to day operating requirements."

"We continue to proactively address the operating challenges presented by the current global economic environment," Mr. Simons continued. "And we will use our strong balance sheet and solid working capital position to manage through the difficult times ahead of us, as well as prepare for growth as the economy recovers.