Lapolla Industries Closes on New Line of Credit
New Facility and Reduction of Debt Provides Substantial Savings
Houston, TX, September 12, 2016 – Lapolla Industries, Inc. (“Lapolla” or the “Company”) (OTCQX: LPAD), a Houston-based global supplier and manufacturer of spray polyurethane foam insulation, roofing foam, reflective roof coatings, and equipment for their application, announced today that by significantly reducing outstanding debt and obtaining a $15 million line of credit with Bank of America, N.A. on September 7, 2016, the Company will be able to reduce interest expense by 78%.
Douglas J. Kramer, CEO and President of Lapolla stated, “During the first half of 2016, we reduced our debt by $5.9 million, reducing interest by $373,000 on an annual basis. We have also amended our Loan and Security Agreement with Bank of America which now provides the Company with a $15 million line of credit that has a substantially lower interest rate and very favorable terms. This allowed us to pay off our higher interest Term Notes, which reduced our average cost of capital from 9.7% to 3.0%, resulting in further interest savings of $583,000 on an annual basis. The overall interest savings will be $936,000 on an annual basis.”
“This is a significant milestone for Lapolla and is the direct result of our corporate commitment to success and financial diligence. The reduction of debt and lower cost of capital will provide significant value to Lapolla and our shareholders while supporting our continued growth. We have been extremely fortunate to have had Enhanced Capital and Bank of America as our partners over the years and we are very appreciative of their support.” concluded Mr. Kramer.
Lapolla’s Chief Financial Officer, Jomarc C. Marukot added, “The Agreement with Bank of America provides the Company with greater flexibility and significantly reduces interest expense, this will have a positive impact on cash flow and increase net income, further strengthening the Company’s balance sheet.”
About Lapolla Industries, Inc.
Lapolla Industries, Inc. is a global supplier and manufacturer of spray polyurethane foam insulation, roofing foam, reflective roof coatings, and equipment for their application designed to reduce energy consumption in the residential, industrial and commercial markets for both new construction and retrofit applications. More information is available at www.lapolla.com.
Forward Looking Statements
Certain statements in this press release that are forward-looking and not statements of historical fact are forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are generally identifiable by the use of words like “may,” “will,” “should,” “could,” “expect,” “anticipate,” “estimate,” “believe,” “intend,” or “project” or the negative of these words or other variations on these words or comparable terminology. The reader is cautioned not to put undue reliance on these forward-looking statements, as these statements are subject to numerous factors and uncertainties outside of our control that can make such statements untrue. More detailed information about the Company and the risk factors that may affect the realization of forward-looking statements is set forth in the Company’s filings with the Securities and Exchange Commission (SEC), including the Company’s Annual Report on Form 10-K and its Quarterly Reports on Form 10-Q. Investors and security holders are urged to read these documents free of charge on the SEC’s web site at http://www.sec.gov. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise.
Michael T. Adams, EVP