Phoenix Footwear Enters Into New $4.5 Million Revolving Credit Facility With First Community Financial

CARLSBAD, Calif., Dec. 4  /PRNewswire-FirstCall/ -- Phoenix Footwear Group, Inc. (NYSE Amex: PXG), announced today that it has entered into a new two year, secured revolving credit facility with First Community Financial, a division of Pacific Western Bank. The facility replaces the Company's previous credit facility with Wells Fargo Business Credit. The new credit facility provides for a line of credit up to $4.5 million, subject to a borrowing base limit, and as of December 4, 2009, has $2.0 million in borrowings, net of cash, outstanding under the new facility.

Borrowings under the new credit facility bear interest at an annual rate of prime plus 2.75%, subject to a minimum of 6%. Additionally, the there is a minimum monthly interest charge of $10,000 for the first year of the facility and $5,000 for the following year. The new credit facility is secured by liens on certain personal property of the Company and its subsidiaries.

"We are pleased to be able to announce our new credit facility. While this has been a lengthy process, it has resulted in a significant increase in capacity, a more competitive cost of funds and a multi-year commitment giving us working capital strength and flexibility to support our efforts to grow our brands", said Rusty Hall, Phoenix Footwear's Chief Executive Officer. "We finish the year having accomplished our critical initiatives including; rightsizing the organization, divesting or exiting two lines of business and recapitalizing our balance sheet. We have also gained momentum of late with a substantial increase in our future orders and number of new retail partners. We are working to translate this into a return to sustained, profitable growth."

About Phoenix Footwear Group, Inc.

Phoenix Footwear Group, Inc., headquartered in Carlsbad, California, designs, develops and markets men's and women's footwear and accessories. Phoenix Footwear's brands include Trotters®, SoftWalk® and H.S. Trask®. Emphasizing quality, fit, and traditional and authentic designs, these brands are primarily sold through department stores, specialty retailers, mass merchants and catalogs. Phoenix Footwear Group, Inc. is traded on the NYSE Amex under the symbol PXG.

Forward-Looking Statements

The words "anticipates," "will," "expects," "intends" and words of similar meaning identify forward-looking statements. Forward-looking statements also include representations of the Company's expectations or beliefs concerning future events that involve risks and uncertainties, including the risks detailed in the Company's periodic report filings with the Securities and Exchange Commission. The forward-looking statements speak only as of the date of this press release, and the Company expressly disclaims any obligation to release publicly any update or revision to any forward-looking statement contained herein if there are changes in the Company's expectations or if any events, conditions or circumstances on which any such forward-looking statement is based.

This press release contains certain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which are intended to be covered by the safe harbors created thereby. These forward-looking statements include, but are not limited to, statements regarding future growth and performance of individual brands, Phoenix Footwear's expected financial performance and condition for fiscal 2009 and/or statements preceded by, followed by or that include the words "believes," "could," "expects," "anticipates," "estimates," "intends," "plans," "projects," "seeks," "exploring," or similar expressions. Many of these risks and uncertainties are discussed in Phoenix Footwear's Annual Report on Form 10-K for the fiscal year ended January 3, 2009 filed with the Securities and Exchange Commission (the "SEC"), and in any subsequent reports filed with the SEC, all of which are available at the SEC's website at http://www.sec.gov/. These include, without limitation: the risk that Phoenix Footwear could be delisted from the NYSE Amex; the risk that Phoenix Footwear will not be able to continue as a going concern; Phoenix Footwear's ability to sustain its return to profitability despite its restructuring efforts and debt reduction; risk associated with the recent disruptions in the overall economy and the impact on the retail industry, including Phoenix Footwear's customers; risk associated with Phoenix's accessories business; the concentration of Phoenix Footwear's sales to a relatively small group of customers; changing consumer preferences and fashion trends; Phoenix's ability to execute on its growth strategies, including the introduction of new products or the distribution of products through new channels; competition from other companies in Phoenix Footwear's markets; the potential financial instability of Phoenix Footwear's customers and the risk of loss of future and pending orders; Phoenix Footwear's ability to protect its intellectual property rights; the risk of losing third party trademark licenses; Phoenix Footwear's ability to manage inventory levels; fluctuations in its financial results as a result of the seasonality in its business; the risks of doing business in international markets; Phoenix Footwear's reliance on independent manufacturers, including those to whom the Company may be past-due; disruptions in Phoenix Footwear's manufacturing system; the loss of one or more senior executives; fluctuations in the price, availability and quality of raw materials; a decline in general market and economic conditions; and, risk associated with claims arising from divestiture transactions, including indemnification claims. Although Phoenix Footwear believes that the assumptions underlying the forward- looking statements contained herein are reasonable, any of the assumptions could be inaccurate, and therefore, there can be no assurance that the forward-looking statements included in this press release will prove to be accurate. In light of the significant uncertainties inherent in the forward-looking statements included herein, the inclusion of such information should not be regarded as a representation by Phoenix Footwear or any other person that the objectives and plans of Phoenix Footwear will be achieved. All forward-looking statements included in this press release are based on Phoenix Footwear's current expectations and projections about future events, based on information available at the time of the release, and Phoenix Footwear assumes no obligation to update any forward-looking statements. 

DATASOURCE: Phoenix Footwear Group, Inc.



CONTACT:  Dennis T. Nelson, Chief Financial Officer, Phoenix Footwear

Group, Inc., [phone]



Web Site:  http://www.phoenixfootwear.com/ 

Copyright