Rayonier Advanced Materials Announces Credit Agreement Amendment Providing Financial Covenant Relief Through 2021
September 30 2019 - 4:17PM
Business Wire
Rayonier Advanced Materials Inc. (the “Company”) today announced
that it has reached agreement with lenders under its Senior Secured
Credit Agreement and entered into an amendment (the “Amendment”)
under which, among other changes, the lenders have agreed to relax
the Total Net Senior First Lien Secured Leverage Ratio and Interest
Coverage Ratio tests through 2021. The Amendment also increases the
interest rate margin on borrowings to be paid to lenders by a
maximum of 1.25 percent, subject to operation of a pricing grid
which provides for reduced interest rate margins with improved
leverage ratios; provides additional collateral for the lenders;
and requires the Company to maintain availability under its
revolving credit facility in specified amounts that vary to reflect
the seasonality of the business. Lenders were paid a customary fee
as consideration for their consent to the Amendment.
Under the terms of the Amendment, the Company will also retain
up to $50 million in net proceeds from the previously-announced
sale of its Matane pulp mill, which remains on track to close in
the fourth quarter, with the remainder of the net proceeds to be
used to repay a portion of the Company’s secured debt.
“Working collaboratively with our lenders, we reached an
Amendment that addresses the current challenging commodity markets,
provides enhanced financial flexibility through 2021 and allows us
to avoid the potential covenant breach that led to the going
concern disclosure in our second quarter financial statements,”
said Paul G. Boynton, Chairman, President and Chief Executive
Officer. “We believe we now have the runway to manage the business
through these challenging economic conditions, enabling us to
emerge financially stronger and able to realize the earnings
potential of our business.”
About Rayonier Advanced Materials
Rayonier Advanced Materials is a global leader of
cellulose-based technologies, including high purity cellulose
specialties, a natural polymer commonly found in cell phones,
computer screens, filters and pharmaceuticals. The Company also
manufactures products for lumber, paper and packaging markets. With
manufacturing operations in the U.S., Canada and France, Rayonier
Advanced Materials employs approximately 4,200 people and generated
approximately $2.1 billion of revenues in 2018. More information is
available at www.rayonieram.com.
Forward-Looking Statements
Certain statements in this document regarding anticipated
financial, business, legal or other outcomes including business and
market conditions, outlook and other similar statements relating to
Rayonier Advanced Materials’ future events, developments, or
financial or operational performance or results, are
“forward-looking statements” made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995
and other federal securities laws. These forward-looking statements
are identified by the use of words such as “may,” “will,” “should,”
“expect,” “estimate,” “believe,” “intend,” “forecast,”
“anticipate,” “guidance,” and other similar language. However, the
absence of these or similar words or expressions does not mean a
statement is not forward-looking. While we believe these
forward-looking statements are reasonable when made,
forward-looking statements are not guarantees of future performance
or events and undue reliance should not be placed on these
statements. Although we believe the expectations reflected in any
forward-looking statements are based on reasonable assumptions, we
can give no assurance these expectations will be attained and it is
possible actual results may differ materially from those indicated
by these forward-looking statements due to a variety of risks and
uncertainties. Certain important factors that could cause actual
results or events to differ materially from those expressed in
forward-looking statements that may have been made in this document
are described or will be described in our filings with the U.S.
Securities and Exchange Commission, including our Annual Report on
Form 10-K, including those described under :Risk Factors” in Item
1A of such document, and Quarterly Reports on Form 10-Q. Rayonier
Advanced Materials assumes no obligation to update these statements
except as is required by law.
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Media: Eric Johnson, 904-357-9134 Investors: Mickey Walsh,
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