Exhibit 99.2
AMENDMENT NO. 5 TO REVOLVING CREDIT AGREEMENT
This AMENDMENT NO. 5 TO REVOLVING CREDIT 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, THE CIT GROUP/BUSINESS CREDIT, INC., 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 Revolving Credit Agreement, dated as of April 19, 2005
(as amended, supplemented, restated or otherwise modified from time to time, the
"Credit Agreement");
WHEREAS, the parties hereto have agreed to, among other things, increase
permitted unsecured debt by $2,000,000 which may be used to prepay the Loans;
NOW THEREFORE, in consideration of the foregoing recital, mutual agreements
contained herein and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Administrative Agent and
Lenders hereby agree as follows:
SECTION 1. 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 2. 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;
(b) the representations and warranties contained herein shall be true and
correct in all respects; and
(c) evidence that the Borrower, the Loan Parties and the required lenders party
to the Term Loan Agreement have effectuated amendments to the Term Loan
Agreement comparable to the amendments set forth in Section 1 hereof.
SECTION 3. 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, (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 and the Administrative Agent continues to fully reserve
its rights with respect to such Event of Default in accordance with the Notice
of Event of Default; Reservation of Rights, dated February 7, 2005, previously
delivered to Palco) as a result of the breach of Section 6.11 (Minimum Combined
EBITDA) of the 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 Term Loan Agreement which may occur in respect of the period
ending December 31, 2005, 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 3(a)(ii) above, no event has occurred
which has resulted, or would result in, the occurrence of a Default or Event of
Default.
SECTION 4. 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; and
(b) The amendment 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 or (iii)
constitute a waiver of any provision of the Credit Agreement or any Loan
Document, 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.
SECTION 5. Costs And Expenses. As provided in Section 9.05 of the Credit
Agreement, the Borrower agrees 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 6. Reaffirmation of Guaranties. The Loan Parties signatory hereto hereby
reaffirm their Guarantees of the Obligations, taking into account the provisions
of this Amendment.
SECTION 7. GOVERNING LAW. THIS WAIVER SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
SECTION 8. 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 9. 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.
BORROWERS:
THE PACIFIC LUMBER COMPANY
By: /s/ Xxxx X. Xxxxx
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Name: XXXX X. XXXXX
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Title: VP, Finance & Administration and CFO
XXXXX LUMBER CO., INC.
By: /s/ Xxxx X. Xxxxx
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Name: XXXX X. XXXXX
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Title: VP Finance & Administration and CFO
THE CIT GROUP/BUSINESS CREDIT, INC.,
as Administrative Agent and Lender
By: /s/ Xxxxxxx Xxxxxxx
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Name: XXXXXXX XXXXXXX
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Title: Vice President
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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
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Name: XXXX X. XXXXX
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Title: President and CEO
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SCOTIA INN INC.
By: /s/ Xxxx X. Xxxxx
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Name: XXXX X. XXXXX
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Title: VP Finance & Administration and CFO
MAXXAM GROUP INC.
By: /s/ Xxxx X. Xxxxx
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Name: XXXX X. XXXXX
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Title: Vice President and CFO
