PORTLAND, OR, Dec. 19, 2013 /PRNewswire/ - CRAiLAR Technologies Inc. (TSXV: CL) (OTCQB: CRLRF), which produces and markets CRAiLAR® Flax fiber The Friendliest Fiber On The Planet™, today announced that it has completed a General Supply Agreement and CA$3.2 million of financing with Ikea. IKEA has extended the Company a €2.2 million (CA$3.2 million), 30 month, 1.9% fixed rate loan ("Loan") designated for the installation of equipment to support and expand CRAiLAR's European production facility and working capital for IKEA orders. The Loan is to be secured by assets purchased with the proceeds as well as a portion of the secured assets used to secure the July 26, 2013 10% secured convertible debentures.
The IKEA General Supply Agreement provides for exclusivity in certain domestic textiles categories and requires minimum order quantities through 2019. CRAiLAR has already received orders and has begun flax fiber production for IKEA at its European production facility.
" A robust commercialization agreement together with financing from an iconic global customer is a major step for CRAiLAR as a brand, manufacturer and supplier" said Ken Barker, CEO. "We are very proud and humbled by this vote of confidence, and are excited to begin delivering CRAiLAR Flax fiber to consumers globally, while working with the largest home furnishings retailer in the world."
The Company has agreed to amend, in exchange for the release of secured assets, the conversion terms of its July 26, 2013 10.0% secured, subordinated convertible debentures (the "Debentures"); in the principal amount of $3,535,000; such that, at the holder's option, the Debentures may now be converted into common shares in the capital of the Company at $1.25 instead of $2.00 per Share.Each of the proposed Loan and amended Debentures is subject to definitive documentation and TSX Venture Exchange approval prior to the completion thereof.