United States Securities and Exchange Commission
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of
Report (Date of earliest event reported): April 29, 2010
P. H. Glatfelter Company
(Exact name of registrant as specified in its charter)
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| Pennsylvania
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1-3560
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23-0628360 |
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| (State or other jurisdiction of incorporation)
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(Commission File Number)
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(IRS Employer Identification Number) |
96 South George Street, Suite 500
York, Pennsylvania 17401
(Address of principal executive offices) (Zip Code)
(717) 225-4711
(Registrant’s telephone number, including area code)
Check the appropriate box below if the form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2 to Form 8-K):
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 24.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17
CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17
CFR 40.13e-4(c)) |
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| Item 1.01 |
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Entry into a Material Definitive Agreement |
On
April 29, 2010, P. H.
Glatfelter Company (the “Company”), certain of its subsidiaries as borrowers (together with the Company,
the “Borrowers”)
and certain of its subsidiaries as guarantors entered into a Credit Agreement (the “Credit Agreement”)
with certain banks (the “Banks”), PNC Bank, National
Association, as administrative agent for the banks under the Credit
Agreement (the “Agent”), PNC Capital Markets LLC and Citizens Bank of Pennsylvania, as joint lead arrangers and
bookrunners, and Citizens Bank of Pennsylvania, as syndication agent (the “Syndication Agent”). The description
of the terms of the Credit Agreement contained in Item 2.03 below is incorporated herein by reference.
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| Item 1.02 |
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Termination of a Material Definitive Agreement |
On
April 29, 2010,
simultaneously with entering into the Credit Agreement, the terms of which are described in Item 2.03 below, the
Company terminated its existing $200 million revolving credit facility and its existing $100 million term loan
facility (the “Prior Credit Facilities”) evidenced by those certain Credit Agreements, dated as of April 3, 2006,
among the Company, certain of its subsidiaries as borrowers and party thereto, certain financial institutions party
thereto (the “Existing Banks”) and PNC Bank, National Association, as agent for the Existing Banks.
Prior to the termination of the Prior Credit Facilities, the Company
had repaid in full all of its obligations under the
Prior Credit Facilities. The lending commitments under the Prior Credit Facilities were scheduled to expire on
April 2, 2011. The Agent under the Credit Agreement was an Existing Bank under the Prior Credit Facilities.
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| Item 2.03 |
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Creation of a Direct Financial Obligation or an Obligation Under an Off-Balance Sheet
Arrangement. |
Pursuant to the Credit
Agreement, the Borrowers may borrow, repay and reborrow multi-currency revolving credit loans (the “Revolving Loans”)
in an aggregate principal amount not to exceed $225 million outstanding at any time (the “Revolving Facility”).
Under the Revolving Facility, the Borrowers may request (i) letters of credit in an aggregate face amount not to
exceed $20 million and (ii) Swing Loans (as defined in the Credit Agreement) in an aggregate principal amount not
to exceed $20 million. Borrowings under the Credit Agreement will be available in United States dollars, Euros,
British Pound Sterling, and Canadian dollars. Under the Credit Agreement, the Borrowers also have the option to
request of the Agent, subject to the approval of the Banks, that the maximum principal amount of the Revolving
Facility be increased from $225 million up to a maximum of $300 million. All borrowings under the Credit Agreement
are unsecured.
The
Borrowers are permitted under the Credit Agreement to use the
borrowings for their general corporate purposes, working capital needs
and to finance future permitted acquisitions.
Borrowing rates for the
Revolving Loans are determined at the Borrowers’ option at the time of each borrowing as follows: for all US dollar
denominated borrowings, the borrowing rate is either, (a) the bank’s base rate
plus an applicable spread (the “bank base rate”) based on the corporate credit ratings of
the Company determined by Standard & Poor’s Rating Services and
Moody’s Investor Service, Inc. (the “Corporate Credit
Rating”)
which is equal to the greater of the prime
rate, the federal funds rate plus 50 basis points, or the daily
London Interbank Offer Rate (“LIBOR”) plus 100 basis points; or (b) a Euro-Rate
based generally on the daily LIBOR plus an applicable margin ranging from 175 basis points to
275 basis points based on the Corporate Credit Rating of the Company. For non-US dollar denominated borrowings, interest is based on (b) above.
All
Swing Loans will bear interest
at a rate to be agreed upon by the Agent and the
Company. In addition, the Borrowers are required to pay customary commitment fees in connection with the unused
portion of the Revolving Facility and customary fees for use of letters of credit.
All principal outstanding
under the Revolving Facility will be due and payable on May 31, 2014. Interest accrued on outstanding amounts under
the Revolving Facility will be payable at maturity of the respective
amount drawn, but in no event less frequently than quarterly.
The Borrowers have the
right to prepay the Revolving Loans in whole or in part without premium or penalty, subject to timing conditions
related to the borrowing rate chosen by the applicable Borrower.
The Credit Agreement contains
representations, warranties and covenants customary for financings of this type including, without limitation,
financial covenants under which the Borrowers are obligated to
maintain a maximum ratio of consolidated total net debt
to consolidated adjusted EBITDA and a minimum ratio of consolidated EBITDA to consolidated interest
expense, and covenants limiting the ability of the Borrowers and subsidiary guarantors to (i) incur debt and
guaranty obligations, (ii) incur liens, (iii) make loans, advances, investments and acquisitions, (iv) merge
or liquidate, (v) sell or transfer assets, or (vi) engage in transactions with affiliates.
The Credit Agreement also
contains customary events of default, including, without limitation, (i) failure to pay principal, interest or fees
when due; (ii) material breach of representations or warranties, (iii) covenant default, (iv) cross-default to other
debt in excess of an agreed amount, (v) a change in control, (vi) insolvency or bankruptcy, and (vii) monetary judgment
default in excess of an agreed amount. If an event of default under the Credit Agreement occurs and is continuing,
then the Agent may declare outstanding obligations under the Credit Agreement immediately due and payable.
In addition to their
functions under the Credit Agreement and the Prior Credit Facilities, the Agent and Syndication Agent perform certain
general banking services for the Company. All services provided to the Company by the Agent and Syndication Agent
have been provided to the Company on substantially the same terms as those prevailing at the time for comparable
transactions with other persons.
The description of the Credit
Agreement set forth above is qualified by reference to the Credit Agreement filed herewith as Exhibit 10.1 and
incorporated herein by reference.