Resolute Forest Products Inc. (NYSE: RFP) (TSX: RFP) today announced that it has entered into an amended and restated senior secured credit agreement for up to $360 million, replacing the company's existing $185 million senior secured credit facility. The amended and restated credit agreement includes a term loan facility of up to $180 million and a six-year revolving credit facility of up to $180 million. The term loan facility is available with a delayed draw period of up to three years, and the choice of maturities of six to ten years from the date of drawing.
"This renewal and upsize gives us an additional $175 million of liquidity – for over $740 million in total – and at very competitive rates, flexible terms and maturities of up to 13 years. Reflecting our strong financial situation, we renewed and upsized the facility without pledging any additional collateral," said Remi G. Lalonde, senior vice president and chief financial officer. "This is another tool to further enhance our financial flexibility in the execution of our strategic transformation initiatives," added Yves Laflamme, president and chief executive officer.
At closing, the company repaid its $46.25 million term loan by borrowing under its new six-year revolving credit facility. Future borrowings under the senior secured credit facility will be used for general corporate purposes.
The amended and restated senior secured credit agreement contains customary covenants, representations and warranties, and events of default for credit agreements of this type. The company's obligations under the facility are guaranteed by certain material U.S. subsidiaries and are secured by first priority liens on assets of its Calhoun (Tennessee) mill. The credit agreement also provides for an uncommitted option to increase the facility by up to an additional $360 million, subject to certain terms and conditions.
The amended and restated senior secured credit agreement was arranged and syndicated by American AgCredit. Troutman Sanders acted as legal counsel to Resolute.
www.resolutefp.com
