Exhibit 4.2.8
AMENDMENT
DATED AS OF JANUARY 1, 1998
TO
CREDIT AND SECURITY AGREEMENT
DATED AS OF NOVEMBER 30, 1992
Reference is hereby made to that certain Credit and Security Agreement
("Credit Agreement") dated as of November 30, 1992 among Principal Mutual Life
Insurance Company, Aetna Life Insurance Company, The Northwestern Mutual Life
Insurance Company, Chemical Bank, Seattle-First National Bank and Bank of
America Oregon, and WTD Industries, Inc. and its Affiliates and the Term Notes
issued by the Borrowers in connection with the Credit Agreement. Capitalized
terms used herein shall have the same meaning ascribed thereto in the Credit
Agreement.
The Term Notes currently are held by the following entities in the
proportions set forth herein:
Principal Mutual Life
Insurance Company 57.111632%
The Northwestern Mutual Life
Insurance Company 20.450484%
Foothill Group, Inc. 13.532675%
Xxxxxxxxxxx & Co., Inc. 6.911127%
Fixed Plus Partners, beneficial owner
of Note registered in the name of
Bear Xxxxxxx Securities Corp. 1.994082%
The Credit Agreement is hereby modified as follows:
1. Credit Agreement Section 6.01.C is hereby restated to read as
follows:
C. Collateral Coverage Ratio. Maintain a ratio of Borrower's
Current Collateral to the outstanding balance of the Term Loan (the
"Collateral Ratio"), not less than the Collateral Ratio set forth
below, at all times during the periods set forth below:
Period Collateral Ratio
Effective Date through 4/30/95 0.55 (55%)
5/1/95 through 12/31/95 0.60 (60%)
1/1/96 through 2/29/96 0.54 (54%)
3/1/96 through 3/31/96 0.55 (55%)
4/1/96 through 6/30/96 0.56 (56%)
7/1/96 through 12/31/97 0.60 (60%)
1/1/98 through 7/31/98 0.57 (57%)
8/1/98 through 1/31/99 0.60 (60%)
2/1/99 and beyond 0.65 (65%)
As used herein, "Current Collateral" means for Borrowers, on a
consolidated basis, all in accordance with GAAP, (i) all Current Assets, less
(ii) the sum of (x) Borrower's current assets which are classified on Borrowers'
consolidated balance sheet as "prepaid expenses", excluding the amount of
interest prepaid on the Term Notes, and otherwise included in prepaid expenses,
(y) Borrowers' current liabilities which are classified on Borrowers'
consolidated balance sheet as "accounts payable", and (z) all of Borrowers'
current liabilities which are classified on Borrowers' consolidated balance
sheet as "timber contracts payable."
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2. Credit Agreement Section 6.01.G is hereby restated to read as follows:
G. Minimum Cumulative Adjusted EBITDA. Maintain a minimum
EBITDA (calculated from and including the first day of the first
calendar month following the Effective Date) minus (a) actual Capital
Expenditures, minus (b) Timber and Timberlands Expenditures
Non-Current, of not less than the respective amount set forth below, at
all times during the periods set forth below:
Period Millions of Dollars
Effective Date through 4/30/93 0
5/1/93 through 7/31/93 2
8/1/93 through 1/31/94 5
2/1/94 through 7/31/94 10
8/1/94 through 12/31/95 20
1/1/96 through 6/30/96 19
7/1/96 through 12/31/96 22.5
1/1/97 through 6/30/97 25
7/1/97 through 7/31/98 27.5
8/1/98 through 10/31/98 32.5
11/1/98 through 4/30/99 40
5/1/99 through 4/30/00 52.5
5/1/00 and beyond 67.5
3. Credit Agreement Section 6.01.J is hereby restated to read as
follows:
J. Minimum Working Capital. Maintain minimum working capital,
at all times during the periods set forth below, calculated as Current
Assets minus Current Liabilities; provided, for the purpose of
computing Current Assets under this Section 6.01.J, the portion of
Current Assets which consists of Timber and Timberlands Current or
contract rights relating thereto shall be included only up to an amount
equal to (x) on or before January 31, 1993, forty-five percent (45%)
and (y) thereafter, forty percent (40%), of the amount of Borrowers'
overall Current Assets determined in accordance with GAAP:
Period Millions Of Dollars
Effective Date through 12/31/95 25
1/1/96 through 6/30/96 19
7/1/96 through 6/30/97 22.5
7/1/97 through 9/30/97 25
10/1/97 through 12/31/97 21.5
1/1/98 through 10/31/98 17.5
11/1/98 and beyond 20
4. Credit Agreement Section 6.01.K is hereby restated to read as
follows:
K. Minimum Operating Income. In no fiscal quarter of
Borrowers, incur an operating loss in excess of Three Million Dollars
($3,000,000), calculated as EBIT, except that with respect to
Borrowers' fiscal quarter ending January 31, 1998, said operating loss
shall not exceed Three Million Five Hundred Thousand Dollars
($3,500,000), calculated as EBIT.
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5. Credit Agreement Section 6.02.A is hereby restated to read as
follows:
A. Capital Expenditures. Make Capital Expenditures and Timber
and Timberlands Expenditures Non-Current in an aggregate amount in
excess of Eight Million Dollars ($8,000,000) per fiscal year of
Borrowers, except that for Borrowers' fiscal year ending April 30, 1998
said expenditures shall not exceed Eight Million Five Hundred Thousand
Dollars ($8,500,000).
6. In all other respects, the Credit Agreement shall remain unchanged
and in full force and effect.
EFFECTIVE DATE: January 1, 1998
PRINCIPAL MUTUAL LIFE THE NORTHWESTERN MUTUAL LIFE
INSURANCE COMPANY INSURANCE COMPANY
By: By:
------------------------------ -------------------------------
Its: Its:
------------------------------ -------------------------------
(pro rata interest: 20.450484%)
By:
------------------------------
Its:
------------------------------ FOOTHILL GROUP, INC.
(pro rata interest: 57.111632%)
By:
-------------------------------
XXXXXXXXXXX & CO., INC. Its:
-------------------------------
(pro rata interest: 13.532675%)
By:
------------------------------
Its:
------------------------------ WTD INDUSTRIES, INC.
(pro rata interest: 6.911127%)
By:
-------------------------------
FIXED PLUS PARTNERS, Beneficial Its:
Owner of Note Registered in the Name -------------------------------
of Bear Xxxxxxx Securities Corp.
By:
------------------------------
Its:
------------------------------
(pro rata interest: 1.994082%)
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