March 5, 2010 (FinancialWire) — American Home Food Products (OTCBB: AHFP), which is currently doing business as Artisanal Premium Cheese, said it has closed a $2.5 million financing. The terms of the financing include a three-year senior loan with an interest rate of 8% to be paid quarterly, as well as 9.3 million shares of common stock.

As part of the conditions of the financing, the company said it has agreed to the cessation of future preferred dividends with the goal of simplifying its capital structure and eliminating future dilution.

Artisanal plans to use the financing to repay existing debt and obligations including the payoff of its $300,000 loan from Summit Financial. It said that the balance of the capital will be used for working capital to execute the company’s retail roll-out.

Company CEO Daniel W. Dowe said the money will “immediately impact” his firm’s operating performance by lowering its inventory costs and increasing overall inventory.

He said that Artisanal had missed a lot of selling opportunities in our foodservice and online businesses in 2009 due to a shortage of inventory. The new funding, “will remedy this problem and help us execute on our retail store growth strategy with major retailers in the Northeast,” according to Dowe.

He said that Artisanal’s expansion into the retail space is an extension of the company’s presence in the restaurant and hotel industry.

In August 2007 New York-based American Home Food Products acquired 100% of the ownership interests in Artisanal Premium Cheese. The company operates in the specialty cheese market in the United States.

Artisanal mmarkets and distributes a line of specialty, artisanal and farmstead cheese products, as well as other related specialty food products under its own brand to food wholesalers and retailers, as well as directly to consumers through its catalogue and web site.

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