Exhibit 99.1
AMENDMENT NO. 5 TO TERM LOAN AGREEMENT
This AMENDMENT NO. 5 TO TERM LOAN AGREEMENT (this "Amendment") is dated as
of February 16, 2006, by THE PACIFIC LUMBER COMPANY, a Delaware corporation
("Palco"), THE XXXXX LUMBER CO., INC., a Delaware corporation ("Xxxxx" and
together with Palco, the "Borrowers"), the Loan Parties signatory hereto, CREDIT
SUISSE, NEW YORK BRANCH (f/k/a Credit Suisse First Boston, acting through its
New York Branch), as administrative agent (the "Administrative Agent") for
itself and the Lenders under and as defined in the Credit Agreement (as
hereinafter defined), and the Lenders. Unless otherwise specified herein,
capitalized terms used in this Amendment shall have the meanings ascribed to
them by the Credit Agreement.
RECITALS
WHEREAS, the Borrowers, the Administrative Agent and the Lenders have
entered into that certain Term Loan Agreement, dated as of April 19, 2005 (as
amended, supplemented, restated or otherwise modified from time to time, the
"Credit Agreement"); and
WHEREAS, the parties hereto have agreed to amend the Credit Agreement as
set forth herein;
NOW THEREFORE, in consideration of the foregoing, the mutual agreements
contained herein and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:
SECTION 1. Amendment to Section 1.01. Section 1.01 of the Credit Agreement is
hereby amended by amending and resting the definition of "Applicable Margin" as
follows:
""Applicable Margin" shall mean (a) with respect to the Loans comprising
each ABR Borrowing, (i) as of the Closing Date through and including November
17, 2005, 5.00% per annum, (ii) as of November 18, 2005 through and including
March 31, 2006, 7.00% per annum and (iii) at any time on and after April 1,
2006, 5.00% per annum and (b) with respect to the Loans comprising each
Eurodollar Borrowing, (i) as of the Closing Date through and including November
17, 2005, 6.00% per annum, (ii) as of November 18, 2005 through and including
March 31, 2006, 8.00% per annum and (iii) at any time on and after April 1,
2006, 6.00% per annum."
SECTION 2. Amendment to Section 5.04(c). Section 5.04(c) of the Credit Agreement
is hereby amended by amending and restating the phrase prior to clause (i)
thereof as follows: "within 30 days after the end of each fiscal month of each
fiscal quarter (other than the last fiscal month of each fiscal quarter),".
SECTION 3. Amendment to Section 6.01(i). Section 6.01(i) of the Credit Agreement
is hereby amended and restated to read in its entirety as follows:
"(i) (A) other unsecured Indebtedness of Palco to Holdings in an aggregate
amount not to exceed $11,000,000 at any time outstanding in accordance with the
terms of that certain Subordinated Intercompany Note, dated as of April 19,
2005, executed by Palco, Holdings and the other persons party thereto; provided,
however that such unsecured Indebtedness does not mature, and no payments of any
kind may be made on or with respect thereto, until six (6) months after the
Maturity Date and (B) other unsecured Indebtedness of the Borrowers and the
Subsidiaries in an aggregate amount not to exceed $500,000 at any time
outstanding."
SECTION 4. Limited Waiver. The Lenders hereby waive any Event of Default or
Default arising as a result of the Borrowers' failure to furnish to the
Administrative Agent financial statements for the month ended December 31, 2005
within 30 days after the end of such month pursuant to Section 5.04(c) of the
Credit Agreement prior to giving effect to this Amendment.
SECTION 5. Effectiveness. The effectiveness of this Amendment is subject to the
satisfaction of each the following conditions precedent:
(a) this Amendment shall have been duly executed and delivered by the Borrower,
the Loan Parties, the Administrative Agent and each Lender; and
(b) the representations and warranties contained herein shall be true and
correct in all respects.
SECTION 6. Representations and Warranties. In order to induce the Administrative
Agent and each Lender to enter into this Amendment, each Loan Party hereby
represents and warrants to the Administrative Agent and each Lender, which
representations and warranties shall survive the execution and delivery of this
Amendment, that:
(a) all of the representations and warranties contained in the Credit Agreement
and in each Loan Document are true and correct as of the date hereof after
giving effect to this Amendment, except (i) to the extent that any such
representations and warranties expressly relate to an earlier date, in which
case such representations and warranties shall be true and correct as of such
earlier date, (ii) the existence of an Event of Default which has occurred and
is continuing (and for the avoidance of doubt, such Event of Default is in no
respect being waived or cured by this Amendment) as a result of a breach of
Section 7(g) of the Credit Agreement relating to the breach of Section 6.11
(Minimum Combined EBITDA) of the Revolving Credit Agreement in respect of the
period ending November 30, 2005, and (iii) breach of Section 6.11 (Minimum
Combined EBITDA) of the Credit Agreement and Revolving Credit Agreement which
may occur in respect of the period ending December 31, 2005 (and for the
avoidance of doubt, such breach is in no respect being waived or cured by this
Amendment), the Administrative Agent having been previously notified of items
(ii) and (iii);
(b) the execution, delivery and performance by such Loan Party of this Amendment
has been duly authorized by all necessary corporate action required on its part
and this Amendment, and the Credit Agreement is the legal, valid and binding
obligation of such Loan Party enforceable against such Loan Party in accordance
with its terms, except as its enforceability may be affected by the effect of
bankruptcy, insolvency, reorganization, moratorium or other similar laws now or
hereafter in effect relating to or affecting the rights or remedies of creditors
generally;
(c) neither the execution, delivery and performance of this Amendment by such
Loan Party, the performance by such Loan Party of the Credit Agreement nor the
consummation of the transactions contemplated hereby does or shall contravene,
result in a breach of, or violate (i) any provision of any Loan Party's
certificate or articles of incorporation or bylaws or other similar documents,
or agreements, (iii) any law or regulation, or any order or decree of any court
or government instrumentality, or (iii) any indenture, mortgage, deed of trust,
lease, agreement or other instrument to which any Loan Party or any of its
Subsidiaries is a party or by which any Loan Party or any of its Subsidiaries or
any of their property is bound, except in any such case to the extent such
conflict or breach has been waived herein or by a written waiver document, a
copy of which has been delivered to Administrative Agent on or before the date
hereof; and
(d) other than as described in Section 6(a)(ii) above, no event has occurred
which has resulted, or would result in, the occurrence of a Default or Event of
Default.
SECTION 7. Reference to and Effect Upon the Credit Agreement.
(a) Except as specifically set forth above, the Credit Agreement and the other
Loan Documents shall remain in full force and effect and are hereby ratified and
confirmed.
(b) The amendments and waiver set forth herein is effective solely for the
purposes set forth herein and shall be limited precisely as written, and shall
not be deemed to (i) be a consent to any amendment, waiver or modification of
any other term or condition of the Credit Agreement or any other Loan Document,
(ii) operate as a waiver or otherwise prejudice any right, power or remedy that
the Administrative Agent or the Lenders may now have or may have in the future
under or in connection with the Credit Agreement or any other Loan Document,
(iii) constitute a waiver of any provision of the Credit Agreement or any Loan
Document, except as specifically set forth herein, or (iv) constitute a waiver
of any Event of Default, Default or other event or condition that has resulted
in or could result in the occurrence of an Event of Default or Default, except
as specifically set forth herein. Upon the effectiveness of this Amendment, each
reference in the Credit Agreement to "this Agreement", "herein", "hereof" and
words of like import and each reference in the Credit Agreement and the Loan
Documents to the Credit Agreement shall mean the Credit Agreement as amended
hereby. This Amendment shall be construed in connection with and as part of the
Credit Agreement.
(c) Each of the Administrative Agent and the Lenders hereby expressly reserves
its rights at any time to take any and all actions, and to exercise any and all
remedies, authorized or permitted under the Credit Agreement or any other Loan
Document, or available under applicable law or equity or otherwise.
(d) This Amendment shall be a Loan Document.
SECTION 8. Costs And Expenses. As provided in Section 9.05 of the Credit
Agreement, the Borrowers agree to reimburse Administrative Agent for all fees,
costs, and expenses, including the reasonable fees, costs, and expenses of
counsel or other advisors for advice, assistance, or other representation in
connection with this Amendment.
SECTION 9. Reaffirmation of Guaranties. The Loan Parties signatory hereto hereby
reaffirm their Guarantees of the Obligations, taking into account the provisions
of this Amendment.
SECTION 10. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
SECTION 11. Headings. Section headings in this Amendment are included herein for
convenience of reference only and shall not constitute part of this Amendment
for any other purposes.
SECTION 12. Counterparts. This Amendment may be executed in any number of
counterparts, each of which when so executed shall be deemed an original, but
all such counterparts shall constitute one and the same instrument.
(signature page follows)
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment as of the date first written above.
THE PACIFIC LUMBER COMPANY
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Name: XXXX X. XXXXX
Title: VP Finance & Administration and CFO
XXXXX LUMBER CO., INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Name: XXXX X. XXXXX
Title: VP Finance & Administration and CFO
CREDIT SUISSE, NEW YORK BRANCH, as Administrative Agent
By: /s/ Xxxxx Xxxx
-------------------------------------
Name: XXXXX XXXX
Title: Vice President
By: /s/ Xxxxxxx Xxxxxxxxxxx
-------------------------------------
Name: XXXXXXX XXXXXXXXXXX
Title: Associate
CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as a Lender
By: /s/ Xxxxx Xxxx
------------------------------------
Name: XXXXX XXXX
Title: Vice President
By: /s/ Xxxxxxx Xxxxxxxxxxx
------------------------------------
Name: XXXXXXX XXXXXXXXXXX
Title: Associate
GSO CREDIT OPPORTUNITIES FUND (HELIOS), as a Lender
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Managing Director
CREDIT OPPORTUNITIES FUND (EMPLOYEE), as a Lender
By: /s/ Xxxxx Xxxxxxxxx
--------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Managing Director
MARATHON STRUCTURED FINANCE FUND, L.P., as a Lender
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Name: XXXX X. XXXXX
Title: Director
[SIGNATURE PAGE TO AMENDMENT NO. 5]
IN WITNESS WHEREOF, this Amendment has been duly executed as of the date
first written above by below Persons in their capacity as Loan Parties and not
as a Borrower.
SALMON CREEK LLC
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Name: XXXX X. XXXXX
Title: President and CEO
SCOTIA INN INC.
By: /s/ Xxxx X. Xxxxx
-------------------------------------
Name: XXXX X. XXXXX
Title: VP Finance & Administration and CFO
MAXXAM GROUP INC.
By: /s/ Xxxx X. Xxxxx
--------------------------------------
Name: XXXX X. XXXXX
Title: Vice President and CFO
