POTLATCH CORPORATION (NASDAQ:PCH) Files An 8-K Entry into a Material Definitive AgreementItem 1.01 Entry into a Material Definitive Agreement
On February 14, 2018, Potlatch Corporation (the “Company”), and its wholly owned subsidiaries Potlatch Forest Holdings, Inc. and Potlatch Land & Lumber, LLC (the “Borrowers”), entered into a Second Amended and Restated Credit Agreement among KeyBank National Association, as Administrative Agent, L/C Issuer and Swing Line Lender, the Guarantors from time to time party thereto and the Lenders from time to time party thereto (the “Credit Agreement”), amending and restating their existing Amended and Restated Credit Agreement dated as of August 12, 2014 among the Borrowers the Administrative Agent, L/C Issuer and Swing Line Lender, the Guarantors from time to time party thereto and the Lenders from time to time party thereto, as amended by the First Amendment dated January 16, 2015 and the Second Amendment dated November 9, 2015. Capitalized terms used and not otherwise defined herein have the meanings set forth in the Credit Agreement.
Under the Credit Agreement, the lenders have agreed to extend revolving loans to the Borrowers in an initial aggregate principal amount not to exceed $380 million, which may be increased by up to an additional $420 million of principal amount.The Credit Agreement includes a sublimit of $75 million for the issuance of standby letters of credit and a sublimit of $25 million for swing line loans.The Credit Agreement is an unsecured 66-month revolving facility, with a stated maturity date of April 13, 2023.
Pricing is set according to the type of borrowing under the Credit Agreement.LIBOR Loans are issued at a rate equal to LIBOR plus the Applicable Rate, while Base Rate Loans are issued at a rate equal to the Base Rate, which is a fluctuating rate per annum equal to the highest of (a) the Federal Funds Rate plus ½ of 1.00%, (b) LIBOR that would then be applicable to a new LIBOR Loan with a one month Interest Period plus 1.00%, and (c) the rate of interest in effect for such day as publicly announced from time to time by KeyBank as its “prime rate.”The Applicable Rate for LIBOR Loans can range from 0.875% to 1.70% and the Applicable Rate for Base Rate loans can range from 0.00% to 0.70% depending on the Debt Rating.
The Credit Agreement contains covenants that, among other things, limit the Borrowers’ ability to create liens, merge or consolidate, dispose of assets, incur indebtedness and guarantees, repurchase or redeem capital stock and indebtedness, make certain investments and acquisitions, enter into certain transactions with affiliates or change the nature of the Borrowers’ business.The Credit Agreement contains financial covenants including (a) the maintenance of an Interest Coverage Ratio (a ratio of consolidated EBITDDA to consolidated interest expense) of at least 3.00 to 1.00, and (b) a Leverage Ratio (a ratio of total consolidated funded indebtedness to the consolidated value of timberlands and other defined assets) of no more than 40%.
Events of Default under the Credit Agreement include, but are not limited to, payment defaults, covenant defaults, breaches of representations and warranties, cross defaults to certain other material agreements and indebtedness, bankruptcy and other insolvency events, material adverse judgments, actual or asserted invalidity of loan documentation, and certain change of control events.
The monies lent under the Credit Agreement are available to be used by the Borrowers, among other things, to refinance existing indebtedness, fund working capital needs, capital expenditures and for other general corporate purposes, including acquisitions.
The foregoing description of the Credit Agreement is qualified in its entirety by reference to the full text of the Credit Agreement, a copy of which is attached as Exhibit 10.1 hereto and is incorporated herein by reference.
Item 9.01 Financial Statements and Exhibits
(d) Exhibits
POTLATCH CORP ExhibitEX-10.1 2 pch-ex101_6.htm EX-10.1 SECOND AMENDED AND RESTATED CREDIT AGREEMENT pch-ex101_6.htm SECOND AMENDED AND RESTATED CREDIT AGREEMENT Dated as of February 14,…To view the full exhibit click here
About POTLATCH CORPORATION (NASDAQ:PCH)
Potlatch Corporation is a real estate investment trust (REIT). The Company operates through three segments: Resource, Wood Products and Real Estate. The Resource segment management activities include planting and harvesting trees, and building and maintaining roads. Its activities also include hunting leases, recreation permits and leases, mineral rights leases, biomass production and carbon sequestration. Its Wood Products segment manufactures and markets lumber, plywood and residual products at approximately five mills located in Arkansas, Idaho, Michigan and Minnesota. The activities of the Real Estate segment consist of the sale of selected non-core timberland real estate, which consists of over three categories, such as higher or better use (HBU) properties, rural real estate and non-strategic. The Company, through its subsidiaries, Potlatch TRS, operates real estate sales business and approximately five wood products manufacturing facilities that produce lumber and plywood.
