Farmstead Telephone Group, Inc. Completes $3 Million Financing with Laurus Funds

Farmstead Telephone Group, Inc. Completes $3 Million Financing
with Laurus Funds 


EAST HARTFORD, Conn., April 4  /PRNewswire-FirstCall/ -- Farmstead Telephone
Group, Inc. (AMEX:FTG) announced that it has completed a new three-year, $3
million credit facility with Laurus Master Fund, Ltd, a New York-based
institutional fund that specializes in direct investments in small cap
companies. The facility consists of a $2.5 million convertible secured
revolving note and a $500,000 convertible minimum borrowing note. The
outstanding balance on the notes are convertible into shares of the Company's
common stock, subject to certain limitations set forth in the agreement based
upon the stock's trading volume and Laurus' ownership position. The Company
also issued to Laurus a five-year warrant to purchase up to 500,000 shares of
common stock of the Company. Borrowings under the revolving note will be based
upon a percentage of eligible accounts receivable and inventories as defined in
the agreement. This new credit facility replaces the $1.7 million revolving
credit facility the Company had with Business Alliance Capital Corporation.

Jean-Marc Stiegemeier, Farmstead's President and CEO commented, "We are excited
to have entered into this relationship with Laurus Funds. This facility gives
us an immediate uplift in our current borrowing availability and will provide
us with enhanced financial flexibility to continue the execution of our 2005
plan."

About Farmstead

Farmstead Telephone Group, Inc. is an Avaya Inc. Gold Business Partner,
selling, installing and maintaining both new and refurbished Avaya business
communications products nationwide. Further information about Farmstead
Telephone may be found at http://www.farmstead.com/.

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This release contains forward-looking statements that involve risks and
uncertainties. In addition to historical information, investors should consider
carefully the risks associated with an investment in the Company's securities
as previously outlined by the Company in its prior filings with the Securities
and Exchange Commission. 

DATASOURCE: Farmstead Telephone Group, Inc.



CONTACT:  Robert G. LaVigne, CFO of Farmstead Telephone Group, Inc.,

[phone], or fax: [phone] 



Web site:  http://www.farmstead.com/ 

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