On April 27, 2022, Clearfield, Inc. (the “Company”) entered into a Loan Agreement with Bremer Bank, National Association (the “Lender”) (the “loan agreement”), that provides the Company with a $40 million revolving line of credit that is secured by certain of the Company’s assets under a Security Agreement in favor of the Lender (the “security agreement”). The line of credit matures on April 27, 2025 and borrowed amounts will bear interest at a variable rate equal to the CME one-month term SOFR plus 1.85%, but not less than 1.80% per annum. As of April 27, 2022, the initial interest rate for the line of credit indebtedness is 2.50%.

The loan agreement contains customary affirmative and negative covenants and requirements relating to the Company and its operations, including a requirement that the Company maintain a debt service coverage ratio of not less than 1.20 to 1 as of the end of each fiscal year for the fiscal year then ended and that the Company maintain a debt to cash flow ratio of not greater than 2 to 1 measured as of the end of each the Company’s fiscal quarters for the trailing 12 month period.

The debt service coverage ratio is the ratio of Cash Available for Debt Service to Debt Service. Cash Available for Debt Service generally means the Company’s net income, plus the sum of (i) interest expense; plus (ii) depreciation, amortization, and other non-cash expenses; minus (iii) all dividends and distributions. Debt Service means the sum of (i) all obligations of the Company for interest on its indebtedness; plus (ii) all obligations of the Company for payment of principal on its indebtedness within such fiscal year.

For purposes of the debt to cash flow ratio covenant, Debt generally means the sum of: (i) the outstanding balance of the Company’s funded debt; plus (ii) all outstanding commitments to fund additional debt (including without limitation, the amount of the revolving note under the loan agreement that remains unfunded). For purposes of the debt to cash flow ratio covenant, Cash Flow generally means the Company’s net income plus the sum of interest expense, depreciation, taxes, and amortization and other non-cash expenses.

The security agreement also contains customary affirmative and negative covenants and requirements relating to the Company, the security interest created by the security agreement, and the Company’s assets located inside the United States.

The foregoing summaries of the loan agreement and the security agreement do not purport to be complete and are subject to and qualified in their respective entirety by reference to the loan agreement and the security agreement, which are attached hereto as Exhibit 10.1 and Exhibit 10.2, respectively, and are incorporated herein by reference.

On April 28, 2022, the Company issued a press release announcing the results of its second quarter of fiscal 2022 ended March 31, 2022. A copy of that press release is furnished hereto as Exhibit 99.1 and is hereby incorporated by reference. Also furnished hereto as Exhibit 99.2 is the slide presentation that is part of the Company’s “FieldReport” to be used by Cheryl Beranek, the Company’s President and Chief Executive Officer, and Daniel Herzog, the Company’s Chief Financial Officer, during the live webcast and telephone conference relating to the second quarter ended March 31, 2022 results held on April 28, 2022.

The information as set forth under Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.

Exhibit No.		Description
10.1		Loan Agreement dated April 27, 2022 by and between Clearfield, Inc. and Bremer Bank, National Association.
10.2		Security Agreement dated April 27, 2022 by Clearfield, Inc. in favor of Bremer Bank, National Association.
99.1		Press release of Clearfield, Inc. issued on April 28, 2022.
99.2		Presentation of Clearfield, Inc. for April 28, 2022 live webcast and telephone conference.
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)