Escalade Inc. said that it had received a letter from a lender, saying it was in default on its credit agreement, according to a filing with the Securities & Exchange Commission. The filing said that the company and the lender, JPMorgan Chase, are “undertaking negotiations” concerning the default issues.
“The company is actively working on its 2009 business plan, which it believes will improve the company's operations and financial results, thereby meeting Chase's expectations,” it said in the filing.
The Company was out of compliance as of the end of the company's 2008 fiscal second and third quarters, with certain financial covenants (leverage ratio and debt service ratio) set forth in that certain Amended and Restated Credit Agreement, dated as of October 24, 2001, with maximum available funds of $30,000,000 with JPMorgan Chase Bank. As of January 15, 2009, the outstanding balance under the credit agreement was $28,978,037.
