Exhibit 10.2

 

AMENDMENT NO. 6 TO TERM LOAN AGREEMENT

This AMENDMENT NO. 6 TO TERM LOAN AGREEMENT (this "Amendment") is dated as of
March 15, 2006, by THE PACIFIC LUMBER COMPANY, a Delaware corporation ("Palco"),
THE BRITT LUMBER CO., INC., a Delaware corporation ("Britt" and together with
Palco, the "Borrowers"), the Loan Parties signatory hereto, CREDIT SUISSE, NEW
YORK BRANCH (f/k/a Credit Suisse First Boston, acting through its New York
Branch), 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 party hereto. 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 Term Loan Agreement, dated as of April 19, 2005 (as amended,
supplemented, restated or otherwise modified from time to time, the "Credit
Agreement"); and

WHEREAS, the parties hereto have agreed to amend the Credit Agreement as set
forth herein;

NOW THEREFORE, in consideration of the foregoing, the mutual agreements
contained herein and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

SECTION 1. Amendment to Section 1.01. Section 1.01 of the Credit Agreement is
hereby amended by amending and resting the definition of "Applicable Margin" as
follows:

""Applicable Margin" shall mean (a) with respect to the Loans comprising each
ABR Borrowing, (i) as of the Closing Date through and including November 17,
2005, 5.00% per annum, (ii) as of November 18, 2005 through and including May 1,
2006, 7.00% per annum and (iii) at any time on and after May 2, 2006, 5.00% per
annum and (b) with respect to the Loans comprising each Eurodollar Borrowing,
(i) as of the Closing Date through and including November 17, 2005, 6.00% per
annum, (ii) as of November 18, 2005 through and including May 1, 2006, 8.00% per
annum and (iii) at any time on and after May 2, 2006, 6.00% per annum."

SECTION 2.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 $17,000,000 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 3. 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 the Required Lenders;
and

(b)          the representations and warranties contained herein shall be true
and correct in all respects.

SECTION 4. 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, in which
case such representations and warranties shall be true and correct as of such
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) as a result of a breach of
Section 7(g) of the Credit Agreement relating to the breach of Section 6.11
(Minimum Combined EBITDA) of the Revolving Credit Agreement in respect of the
periods ending November 30, 2005 and January 31, 2006, and (iii) breach of
Section 6.11 (Minimum Combined EBITDA) of the Credit Agreement and Revolving
Credit Agreement which may occur in respect of the period ending December 31,
2005 (and for the avoidance of doubt, such breach is in no respect being waived
or cured by this Amendment), 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; and

(d)          other than as described in Section 4(a)(ii) above, no event has
occurred which has resulted, or would result in, the occurrence of a Default or
Event of Default.

SECTION 5. 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.

(b)          The amendments set forth herein are 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,
(iii) constitute a waiver of any provision of the Credit Agreement or any Loan
Document, or (iv) constitute a waiver of any Event of Default, Default or other
event or condition that has resulted in or could result in the occurrence of an
Event of Default or Default. 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.

(c)          Each of the Administrative Agent and the Lenders hereby expressly
reserves its rights at any time to take any and all actions, and to exercise any
and all remedies, authorized or permitted under the Credit Agreement or any
other Loan Document, or available under applicable law or equity or otherwise.

 

(d)

This Amendment shall be a Loan Document.

SECTION 6. Costs And Expenses. As provided in Section 9.05 of the Credit
Agreement, the Borrowers agree 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 7. Reaffirmation of Guaranties. The Loan Parties signatory hereto hereby
reaffirm their Guarantees of the Obligations, taking into account the provisions
of this Amendment.

SECTION 8. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.

SECTION 9. 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 10. 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.

THE PACIFIC LUMBER COMPANY

By: /s/ GARY L. CLARK                                      

Name: GARY L. CLARK

Title: VP Finance & Administration and CFO

BRITT LUMBER CO., INC.

By: /s/ GARY L. CLARK                                      

Name: GARY L. CLARK

Title: VP Finance & Administration and CFO

CREDIT SUISSE, NEW YORK BRANCH, as Administrative Agent

By: /s/ DAVID DODD                                          

Name: DAVID DODD

Title: VICE PRESIDENT

By: /s/ MIKHAIL FAYBUSOVICH                    

Name: MIKHAIL FAYBUSOVICH

Title: ASSOCIATE

CREDIT SUISSE, CAYMAN ISLANDS BRANCH, as a Lender

By: /s/ DAVID DODD                                          

Name: DAVID DODD

Title: VICE PRESIDENT

By: /s/ MIKHAIL FAYBUSOVICH                    

Name: MIKHAIL FAYBUSOVICH

Title: ASSOCIATE

 

[SIGNATURE PAGE TO AMENDMENT NO. 6]

 

 

 

GSO CREDIT OPPORTUNITIES FUND (HELIOS), as a Lender

By: /s/ LOUIS SALVATORE                              

Name: LOUIS SALVATORE

Title: MANAGING DIRECTOR

CREDIT OPPORTUNITIES FUND (EMPLOYEE), as a Lender

By: /s/ LOUIS SALVATORE                              

Name: LOUIS SALVATORE

Title: MANAGING DIRECTOR

 

[SIGNATURE PAGE TO AMENDMENT NO. 6]

 

 

 

MARATHON STRUCTURED FINANCE FUND, L.P., as a Lender

By:                                                                          

Name:

Title:

 

[SIGNATURE PAGE TO AMENDMENT NO. 6]

 

 

 

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/ GARY L. CLARK                                      

Name: GARY L. CLARK

Title: President and CEO

SCOTIA INN INC.

By: /s/ GARY L. CLARK                                      

Name: GARY L. CLARK

Title: VP Finance & Administration and CFO

MAXXAM GROUP INC.

By: /s/ GARY L. CLARK                                      

Name: GARY L. CLARK

Title: Vice President and CFO

 

 

[SIGNATURE PAGE TO AMENDMENT NO. 6]