x | QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
For the transition period from to |
Large accelerated filer x | Accelerated filer o | |
Non-accelerated filer o | Smaller reporting company o |
Item | Page | ||
PART I - FINANCIAL INFORMATION | |||
1. | |||
2. | |||
3. | |||
4. | |||
PART II - OTHER INFORMATION | |||
1. | |||
2. | |||
6. | |||
Three Months Ended March 31, | |||||||
2015 | 2014 | ||||||
SALES | $140,305 | $143,187 | |||||
Costs and Expenses | |||||||
Cost of sales | 107,234 | 115,900 | |||||
Selling and general expenses | 10,898 | 13,237 | |||||
Other operating income, net (Note 17) | (5,574 | ) | (375 | ) | |||
112,558 | 128,762 | ||||||
OPERATING INCOME | 27,747 | 14,425 | |||||
Interest expense | (8,544 | ) | (10,675 | ) | |||
Interest income and miscellaneous expense, net | (1,494 | ) | (1,011 | ) | |||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 17,709 | 2,739 | |||||
Income tax benefit | 471 | 7,596 | |||||
INCOME FROM CONTINUING OPERATIONS | 18,180 | 10,335 | |||||
DISCONTINUED OPERATIONS, NET (Note 2) | |||||||
Income from discontinued operations, net of income tax expense of $0 and $15,308 | — | 31,008 | |||||
NET INCOME | 18,180 | 41,343 | |||||
Less: Net income (loss) attributable to noncontrolling interest | 433 | (83 | ) | ||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 17,747 | 41,426 | |||||
OTHER COMPREHENSIVE (LOSS) INCOME | |||||||
Foreign currency translation adjustment, net of income tax benefit of $343 and $0 | (14,323 | ) | 17,803 | ||||
New Zealand joint venture cash flow hedges, net of income tax benefit (expense) of $436 and ($501) | (946 | ) | 1,711 | ||||
Amortization of pension and postretirement plans, net of income tax expense of $158 and $931 | 781 | 2,097 | |||||
Total other comprehensive (loss) income | (14,488 | ) | 21,611 | ||||
COMPREHENSIVE INCOME | 3,692 | 62,954 | |||||
Less: Comprehensive (loss) income attributable to noncontrolling interest | (3,791 | ) | 5,425 | ||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $7,483 | $57,529 | |||||
EARNINGS PER COMMON SHARE (Note 3) | |||||||
BASIC EARNINGS PER SHARE ATTRIBUTABLE TO RAYONIER INC. | |||||||
Continuing Operations | $0.14 | $0.08 | |||||
Discontinued Operations | — | 0.25 | |||||
Net Income | $0.14 | $0.33 | |||||
DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO RAYONIER INC. | |||||||
Continuing Operations | $0.14 | $0.08 | |||||
Discontinued Operations | — | 0.24 | |||||
Net Income | $0.14 | $0.32 | |||||
Dividends per share | $0.25 | $0.49 |
March 31, 2015 | December 31, 2014 | ||||||
ASSETS | |||||||
CURRENT ASSETS | |||||||
Cash and cash equivalents | $139,049 | $161,558 | |||||
Accounts receivable, less allowance for doubtful accounts of $42 and $42 | 19,960 | 24,018 | |||||
Inventory (Note 14) | 13,100 | 8,383 | |||||
Prepaid and other current assets | 18,040 | 19,745 | |||||
Total current assets | 190,149 | 213,704 | |||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | 2,073,024 | 2,088,501 | |||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS (NOTE 5) | 71,952 | 77,433 | |||||
PROPERTY, PLANT AND EQUIPMENT | |||||||
Land | 1,833 | 1,833 | |||||
Buildings | 8,894 | 8,961 | |||||
Machinery and equipment | 3,530 | 3,503 | |||||
Construction in progress | 710 | 579 | |||||
Total property, plant and equipment, gross | 14,967 | 14,876 | |||||
Less — accumulated depreciation | (8,375 | ) | (8,170 | ) | |||
Total property, plant and equipment, net | 6,592 | 6,706 | |||||
OTHER ASSETS | 70,833 | 66,771 | |||||
TOTAL ASSETS | $2,412,550 | $2,453,115 | |||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||
CURRENT LIABILITIES | |||||||
Accounts payable | $22,228 | $20,211 | |||||
Current maturities of long-term debt | 130,213 | 129,706 | |||||
Accrued taxes | 12,461 | 11,405 | |||||
Accrued payroll and benefits | 2,996 | 6,390 | |||||
Accrued interest | 9,892 | 8,433 | |||||
Other current liabilities | 19,002 | 25,857 | |||||
Total current liabilities | 196,792 | 202,002 | |||||
LONG-TERM DEBT | 612,804 | 621,849 | |||||
PENSION AND OTHER POSTRETIREMENT BENEFITS (Note 13) | 33,661 | 33,477 | |||||
OTHER NON-CURRENT LIABILITIES | 21,077 | 20,636 | |||||
COMMITMENTS AND CONTINGENCIES (Notes 11 and 12) | |||||||
SHAREHOLDERS’ EQUITY | |||||||
Common Shares, 480,000,000 shares authorized, 126,802,309 and 126,773,097 shares issued and outstanding | 703,588 | 702,598 | |||||
Retained earnings | 776,827 | 790,697 | |||||
Accumulated other comprehensive loss | (15,088 | ) | (4,825 | ) | |||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,465,327 | 1,488,470 | |||||
Noncontrolling interest | 82,889 | 86,681 | |||||
TOTAL SHAREHOLDERS’ EQUITY | 1,548,216 | 1,575,151 | |||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $2,412,550 | $2,453,115 |
Three Months Ended March 31, | |||||||
2015 | 2014 | ||||||
OPERATING ACTIVITIES | |||||||
Net income | $18,180 | $41,343 | |||||
Adjustments to reconcile net income to cash provided by operating activities: | |||||||
Depreciation, depletion and amortization | 29,975 | 25,981 | |||||
Non-cash cost of land sold and real estate development costs recovered upon sale | 3,747 | 3,076 | |||||
Stock-based incentive compensation expense | 805 | 3,103 | |||||
Deferred income taxes | (189 | ) | 5,596 | ||||
Non-cash adjustments to unrecognized tax benefit liability | — | (3,896 | ) | ||||
Depreciation and amortization from discontinued operations | — | 20,649 | |||||
Amortization of losses from pension and postretirement plans | 939 | 3,028 | |||||
Other | 105 | 2,368 | |||||
Changes in operating assets and liabilities: | |||||||
Receivables | 3,544 | (15,950 | ) | ||||
Inventories | (3,133 | ) | (950 | ) | |||
Accounts payable | 2,857 | 13,929 | |||||
Income tax receivable/payable | (150 | ) | 1,319 | ||||
All other operating activities | (3,282 | ) | 3,002 | ||||
Expenditures for dispositions and discontinued operations | — | (2,498 | ) | ||||
CASH PROVIDED BY OPERATING ACTIVITIES | 53,398 | 100,100 | |||||
INVESTING ACTIVITIES | |||||||
Capital expenditures | (13,292 | ) | (34,640 | ) | |||
Real estate development costs | (306 | ) | (1,812 | ) | |||
Purchase of timberlands | (23,070 | ) | (10,637 | ) | |||
Change in restricted cash | (7,071 | ) | 45,312 | ||||
Other | — | (778 | ) | ||||
CASH USED FOR INVESTING ACTIVITIES | (43,739 | ) | (2,555 | ) | |||
FINANCING ACTIVITIES | |||||||
Issuance of debt | 12,000 | 31,819 | |||||
Repayment of debt | (11,371 | ) | (110,000 | ) | |||
Dividends paid | (31,667 | ) | (62,545 | ) | |||
Proceeds from the issuance of common shares | 546 | 2,027 | |||||
Repurchase of common shares | (94 | ) | (1,754 | ) | |||
Other | — | (678 | ) | ||||
CASH USED FOR FINANCING ACTIVITIES | (30,586 | ) | (141,131 | ) | |||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | (1,582 | ) | 13 | ||||
CASH AND CASH EQUIVALENTS | |||||||
Change in cash and cash equivalents | (22,509 | ) | (43,573 | ) | |||
Balance, beginning of year | 161,558 | 199,644 | |||||
Balance, end of period | $139,049 | $156,071 | |||||
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION | |||||||
Cash paid during the period: | |||||||
Interest (a) | $5,016 | $6,928 | |||||
Income taxes | 138 | 7,134 | |||||
Non-cash investing activity: | |||||||
Capital assets purchased on account | 2,441 | 17,891 |
(a) | Interest paid is presented net of patronage refunds received of $1.3 million for the three months ended March 31, 2015 and $2.1 million for the three months ended March 31, 2014. For additional information on patronage refunds, see Note 13 — Debt in the 2014 Form 10-K. |
1. | BASIS OF PRESENTATION |
2. | DISCONTINUED OPERATIONS |
Three Months Ended March 31, 2014 | ||||
Sales | $243,499 | |||
Cost of sales and other | (193,864 | ) | ||
Transaction expenses | (3,319 | ) | ||
Income from discontinued operations before income taxes | 46,316 | |||
Income tax expense | (15,308 | ) | ||
Income from discontinued operations, net | $31,008 |
Three Months Ended March 31, 2014 | |||
Interest expense allocated to the Performance Fibers business | ($2,295 | ) |
Three Months Ended March 31, 2014 | |||
Depreciation and amortization | $20,649 | ||
Capital expenditures | 17,876 |
Three Months Ended March 31, 2014 | |||
Hardwood purchases | $2,745 |
3. | EARNINGS PER COMMON SHARE |
Three Months Ended March 31, | |||||||
2015 | 2014 | ||||||
Income from continuing operations | $18,180 | $10,335 | |||||
Less: Net income (loss) from continuing operations attributable to noncontrolling interest | 433 | (83 | ) | ||||
Income from continuing operations attributable to Rayonier Inc. | $17,747 | $10,418 | |||||
Income from discontinued operations, net, attributable to Rayonier Inc. | — | 31,008 | |||||
Net income attributable to Rayonier Inc. | $17,747 | $41,426 | |||||
Shares used for determining basic earnings per common share | 126,614,334 | 126,344,987 | |||||
Dilutive effect of: | |||||||
Stock options | 168,680 | 286,535 | |||||
Performance and restricted shares | 51,494 | 83,850 | |||||
Assumed conversion of Senior Exchangeable Notes (a) | 892,885 | 1,063,538 | |||||
Assumed conversion of warrants (a) | — | 645,583 | |||||
Shares used for determining diluted earnings per common share | 127,727,393 | 128,424,493 | |||||
Basic earnings per common share attributable to Rayonier Inc.: | |||||||
Continuing operations | $0.14 | $0.08 | |||||
Discontinued operations | — | 0.25 | |||||
Net income | $0.14 | $0.33 | |||||
Diluted earnings per common share attributable to Rayonier Inc.: | |||||||
Continuing operations | $0.14 | $0.08 | |||||
Discontinued operations | — | 0.24 | |||||
Net income | $0.14 | $0.32 |
Three Months Ended March 31, | |||||
2015 | 2014 | ||||
Anti-dilutive shares excluded from the computations of diluted earnings per share: | |||||
Stock options, performance and restricted shares | 757,960 | 731,046 | |||
Assumed conversion of exchangeable note hedges (a) | 892,885 | 1,063,538 | |||
Total | 1,650,845 | 1,794,584 |
Three Months Ended March 31, | |||||||||||||
2015 | 2014 | ||||||||||||
Income tax expense at federal statutory rate | ($6,198 | ) | 35.0 | % | ($959 | ) | 35.0 | % | |||||
REIT income and taxable losses | 7,502 | (42.4 | ) | 7,188 | (262.4 | ) | |||||||
Foreign operations | 1,137 | (6.4 | ) | (10 | ) | 0.4 | |||||||
Net operating loss valuation allowance | (1,812 | ) | 10.2 | — | — | ||||||||
Other | (158 | ) | 0.9 | 7 | (0.3 | ) | |||||||
Income tax benefit before discrete items | $471 | (2.7 | )% | $6,226 | (227.3 | )% | |||||||
Prior period state tax adjustments | — | — | 1,370 | (50.0 | ) | ||||||||
Income tax benefit as reported for continuing operations | $471 | (2.7 | )% | $7,596 | (277.3 | )% |
Higher and Better Use Timberlands and Real Estate Development Costs | |||||||||||
Land and Timber | Development Costs | Total | |||||||||
Non-current portion at December 31, 2014 | $65,959 | $11,474 | $77,433 | ||||||||
Plus: Current portion (a) | 4,875 | 57 | 4,932 | ||||||||
Total Balance at December 31, 2014 | 70,834 | 11,531 | 82,365 | ||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | (3,669 | ) | (4 | ) | (3,673 | ) | |||||
Timber depletion from harvesting activities | (554 | ) | — | (554 | ) | ||||||
Capitalized real estate development costs (b) | — | 276 | 276 | ||||||||
Capital expenditures (silviculture) | 49 | — | 49 | ||||||||
Acquisitions | — | — | — | ||||||||
Transfers | — | — | — | ||||||||
Total Balance at March 31, 2015 | 66,660 | 11,803 | 78,463 | ||||||||
Less: Current portion (a) | (6,173 | ) | (338 | ) | (6,511 | ) | |||||
Non-current portion at March 31, 2015 | $60,487 | $11,465 | $71,952 |
(a) | The current portion of Higher and Better Use Timberlands and Real Estate Development Costs is recorded in Inventory. See Note 14 — Inventory for additional information. |
(b) | Capitalized real estate development costs for the three months ended March 31, 2015 of $276,000 consisted of $306,000 in cash outflows and a $30,000 change in accrued spending. |
6. | RESTRICTED DEPOSITS |
7. | SHAREHOLDERS’ EQUITY |
Rayonier Inc. Shareholders’ Equity | ||||||||||||||||||||||
Common Shares | Retained Earnings | Accumulated Other Comprehensive Income/(Loss) | Non-controlling Interest | Total Shareholders’ Equity | ||||||||||||||||||
Shares (a) | Amount | |||||||||||||||||||||
Balance, December 31, 2013 | 126,257,870 | $692,100 | $1,015,209 | ($46,139 | ) | $94,073 | $1,755,243 | |||||||||||||||
Net income (loss) | — | — | 99,337 | — | (1,491 | ) | 97,846 | |||||||||||||||
Dividends ($2.03 per share) | — | — | (256,861 | ) | — | — | (256,861 | ) | ||||||||||||||
Contribution to Rayonier Advanced Materials | — | (301 | ) | (61,318 | ) | 80,749 | — | 19,130 | ||||||||||||||
Adjustments to Rayonier Advanced Materials (b) | — | — | (5,670 | ) | (2,556 | ) | — | (8,226 | ) | |||||||||||||
Issuance of shares under incentive stock plans | 561,701 | 5,579 | — | — | — | 5,579 | ||||||||||||||||
Stock-based compensation | — | 7,869 | — | — | — | 7,869 | ||||||||||||||||
Tax deficiency on stock-based compensation | — | (791 | ) | — | — | — | (791 | ) | ||||||||||||||
Repurchase of common shares | (46,474 | ) | (1,858 | ) | — | — | — | (1,858 | ) | |||||||||||||
Net loss from pension and postretirement plans | — | — | — | (24,147 | ) | — | (24,147 | ) | ||||||||||||||
Noncontrolling interest redemption of shares | — | — | — | — | (931 | ) | (931 | ) | ||||||||||||||
Foreign currency translation adjustment | — | — | — | (11,526 | ) | (4,321 | ) | (15,847 | ) | |||||||||||||
Joint venture cash flow hedges | — | — | — | (1,206 | ) | (649 | ) | (1,855 | ) | |||||||||||||
Balance, December 31, 2014 | 126,773,097 | $702,598 | $790,697 | ($4,825 | ) | $86,681 | $1,575,151 | |||||||||||||||
Net income | — | — | 17,747 | — | 433 | 18,180 | ||||||||||||||||
Dividends ($0.25 per share) | — | — | (31,617 | ) | — | — | (31,617 | ) | ||||||||||||||
Issuance of shares under incentive stock plans | 32,196 | 546 | — | — | — | 546 | ||||||||||||||||
Stock-based compensation | — | 805 | — | — | — | 805 | ||||||||||||||||
Tax deficiency on stock-based compensation | — | (267 | ) | — | — | — | (267 | ) | ||||||||||||||
Repurchase of common shares | (2,984 | ) | (94 | ) | — | — | — | (94 | ) | |||||||||||||
Net gain from pension and postretirement plans | — | — | — | 781 | — | 781 | ||||||||||||||||
Foreign currency translation adjustment | — | — | — | (10,429 | ) | (3,894 | ) | (14,323 | ) | |||||||||||||
Joint venture cash flow hedges | — | — | — | (615 | ) | (331 | ) | (946 | ) | |||||||||||||
Balance, March 31, 2015 | 126,802,309 | $703,588 | $776,827 | ($15,088 | ) | $82,889 | $1,548,216 |
(a) | The Company’s common shares are registered in North Carolina and have a $0.00 par value. |
(b) | Primarily relates to adjustments made to the Rayonier Advanced Materials contribution as income taxes and pension and postretirement plan assets and obligations were finalized. |
8. | SEGMENT AND GEOGRAPHICAL INFORMATION |
Three Months Ended March 31, | |||||||
SALES | 2015 | 2014 | |||||
Southern Timber | $35,531 | $33,876 | |||||
Pacific Northwest Timber | 19,154 | 33,038 | |||||
New Zealand Timber | 41,194 | 37,764 | |||||
Real Estate | 23,791 | 5,530 | |||||
Trading | 20,635 | 35,686 | |||||
Intersegment Eliminations | — | (2,707 | ) | ||||
Total | $140,305 | $143,187 |
Three Months Ended March 31, | |||||||
OPERATING INCOME | 2015 | 2014 | |||||
Southern Timber | $12,413 | $10,493 | |||||
Pacific Northwest Timber | 2,587 | 12,642 | |||||
New Zealand Timber | 5,694 | 2,411 | |||||
Real Estate | 12,582 | 725 | |||||
Trading | 270 | (412 | ) | ||||
Corporate and other | (5,799 | ) | (11,434 | ) | |||
Total Operating Income | 27,747 | 14,425 | |||||
Unallocated interest expense and other | (10,038 | ) | (11,686 | ) | |||
Total income from continuing operations before income taxes | $17,709 | $2,739 |
Three Months Ended March 31, | |||||||
DEPRECIATION, DEPLETION AND AMORTIZATION | 2015 | 2014 | |||||
Southern Timber | $14,301 | $11,996 | |||||
Pacific Northwest Timber | 3,790 | 6,297 | |||||
New Zealand Timber | 8,003 | 6,496 | |||||
Real Estate | 3,812 | 910 | |||||
Trading | — | — | |||||
Corporate and other | 69 | 282 | |||||
Total | $29,975 | $25,981 |
Three Months Ended March 31, | |||||||
NON-CASH COST OF LAND SOLD AND REAL ESTATE COSTS RECOVERED UPON SALE | 2015 | 2014 | |||||
Southern Timber | — | — | |||||
Pacific Northwest Timber | — | — | |||||
New Zealand Timber | — | 2,098 | |||||
Real Estate | 3,747 | 978 | |||||
Trading | — | — | |||||
Corporate and other | — | — | |||||
Total | $3,747 | $3,076 |
9. | DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES |
Three Months Ended March 31, | |||||||||
Income Statement Location | 2015 | 2014 | |||||||
Derivatives designated as cash flow hedges: | |||||||||
Foreign currency exchange contracts | Other comprehensive (loss) income | ($700 | ) | $1,487 | |||||
Foreign currency option contracts | Other comprehensive (loss) income | (681 | ) | 725 | |||||
Derivative designated as a net investment hedge: | |||||||||
Foreign currency exchange contract | Other comprehensive (loss) income | 591 | — | ||||||
Derivatives not designated as hedging instruments: | |||||||||
Foreign currency exchange contracts | Other operating (income) expense | — | 25 | ||||||
Foreign currency option contracts | Other operating (income) expense | — | 7 | ||||||
Interest rate swaps | Interest and miscellaneous (expense) income, net | (1,855 | ) | (1,134 | ) | ||||
Fuel hedge contracts | Cost of sales (benefit) | — | 317 |
Notional Amount | |||||||
March 31, 2015 | December 31, 2014 | ||||||
Derivatives designated as cash flow hedges: | |||||||
Foreign currency exchange contracts | $29,560 | $28,540 | |||||
Foreign currency option contracts | 99,400 | 79,400 | |||||
Derivative designated as a net investment hedge: | |||||||
Foreign currency exchange contract | 26,278 | 27,419 | |||||
Derivatives not designated as hedging instruments: | |||||||
Interest rate swaps | 142,101 | 161,968 |
Location on Balance Sheet | Fair Value Assets / (Liabilities) (a) | ||||||||
March 31, 2015 | December 31, 2014 | ||||||||
Derivatives designated as cash flow hedges: | |||||||||
Foreign currency exchange contracts | Prepaid and other current assets | $87 | $132 | ||||||
Other assets | 8 | 59 | |||||||
Other current liabilities | (823 | ) | (272 | ) | |||||
Other non-current liabilities | (49 | ) | — | ||||||
Foreign currency option contracts | Prepaid and other current assets | 393 | 299 | ||||||
Other assets | 390 | 198 | |||||||
Other current liabilities | (2,176 | ) | (1,439 | ) | |||||
Other non-current liabilities | (374 | ) | (196 | ) | |||||
Derivative designated as a net investment hedge: | |||||||||
Foreign currency exchange contract | Prepaid and other current assets | 711 | — | ||||||
Other current liabilities | — | (223 | ) | ||||||
Derivatives not designated as hedging instruments: | |||||||||
Interest rate swaps | Other current liabilities | (80 | ) | — | |||||
Other non-current liabilities | (8,085 | ) | (7,247 | ) | |||||
Total derivative contracts: | |||||||||
Prepaid and other current assets | $1,191 | $431 | |||||||
Other assets | 398 | 257 | |||||||
Total derivative assets | 1,589 | 688 | |||||||
Other current liabilities | (3,079 | ) | (1,934 | ) | |||||
Other non-current liabilities | (8,508 | ) | (7,443 | ) | |||||
Total derivative liabilities | ($11,587 | ) | ($9,377 | ) |
(a) | See Note 10 — Fair Value Measurements for further information on the fair value of the Company’s derivatives including their classification within the fair value hierarchy. |
10. | FAIR VALUE MEASUREMENTS |
March 31, 2015 | December 31, 2014 | ||||||||||||||||||||
Asset (liability) | Carrying Amount | Fair Value | Carrying Amount | Fair Value | |||||||||||||||||
Level 1 | Level 2 | Level 1 | Level 2 | ||||||||||||||||||
Cash and cash equivalents | $139,049 | $139,049 | — | $161,558 | $161,558 | — | |||||||||||||||
Restricted cash (a) | 13,759 | 13,759 | — | 6,688 | 6,688 | — | |||||||||||||||
Current maturities of long-term debt | (130,213 | ) | — | (150,588 | ) | (129,706 | ) | — | (156,762 | ) | |||||||||||
Long-term debt | (612,804 | ) | — | (621,605 | ) | (621,849 | ) | — | (628,476 | ) | |||||||||||
Interest rate swaps (b) | (8,165 | ) | — | (8,165 | ) | (7,247 | ) | — | (7,247 | ) | |||||||||||
Foreign currency exchange contracts (b) | (66 | ) | — | (66 | ) | (304 | ) | — | (304 | ) | |||||||||||
Foreign currency option contracts (b) | (1,767 | ) | — | (1,767 | ) | (1,138 | ) | — | (1,138 | ) |
(a) | Restricted cash is recorded in “Other Assets” and represents the proceeds from LKE sales deposited with a third-party intermediary. |
(b) | See Note 9 — Derivative Financial Instruments and Hedging Activities for information regarding the Balance Sheet classification of the Company’s derivative financial instruments. |
11. | GUARANTEES |
Financial Commitments | Maximum Potential Payment | Carrying Amount of Associated Liability | ||||||
Standby letters of credit (a) | $16,685 | $15,000 | ||||||
Guarantees (b) | 2,254 | 43 | ||||||
Surety bonds (c) | 682 | — | ||||||
Total financial commitments | $19,621 | $15,043 |
(a) | Approximately $15 million of the standby letters of credit serve as credit support for industrial revenue bonds. The remaining letters of credit support various insurance related agreements, primarily workers’ compensation. These letters of credit will expire at various dates during 2015 and will be renewed as required. |
(b) | In conjunction with a timberland sale and note monetization in 2004, the Company issued a make-whole agreement pursuant to which it guaranteed $2.3 million of obligations of a special-purpose entity that was established to complete the monetization. At March 31, 2015, the Company has a de minimis liability to reflect the fair market value of its obligation to perform under the make-whole agreement. |
(c) | Rayonier issues surety bonds primarily to secure timber harvesting obligations in the State of Washington and to provide collateral for the Company’s workers’ compensation self-insurance program in that state. These surety bonds expire at various dates during 2015 and 2016 and are expected to be renewed as required. |
12. | CONTINGENCIES |
• | Sating v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01395; filed November 12, 2014 in the United States District Court for the Middle District of Florida; |
• | Keasler v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01398, filed November 13, 2014 in the United States District Court for the Middle District of Florida; |
• | Lake Worth Firefighters’ Pension Trust Fund v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01403, filed November 13, 2014 in the United States District Court for the Middle District of Florida; |
• | Christie v. Rayonier Inc. et al, Civil Action No. 3:14-cv-01429, filed November 21, 2014 in the United States District Court for the Middle District of Florida; and |
• | Brown v. Rayonier Inc. et al, Civil Action No. 1:14-cv-08986, initially filed in the United States District Court for the Southern District of New York and later transferred to the United States District Court for the Middle District of Florida and assigned as Civil Action No. 3:14-cv-01474. |
13. | EMPLOYEE BENEFIT PLANS |
Pension | Postretirement | ||||||||||||||
Three Months Ended March 31, | Three Months Ended March 31, | ||||||||||||||
2015 | 2014 | 2015 | 2014 | ||||||||||||
Components of Net Periodic Benefit Cost | |||||||||||||||
Service cost | $371 | $1,624 | $3 | $179 | |||||||||||
Interest cost | 830 | 4,683 | 13 | 206 | |||||||||||
Expected return on plan assets | (1,007 | ) | (6,658 | ) | — | — | |||||||||
Amortization of prior service cost | 3 | 292 | — | 4 | |||||||||||
Amortization of losses | 933 | 2,737 | 3 | 129 | |||||||||||
Amortization of negative plan amendment | — | — | — | (134 | ) | ||||||||||
Net periodic benefit cost (a) | $1,130 | $2,678 | $19 | $384 | |||||||||||
(a) | Net periodic benefit cost for the three months ended March 31, 2014 includes $2.0 million recorded in “Income from discontinued operations, net” on the Consolidated Statements of Income and Comprehensive Income. |
14. | INVENTORY |
March 31, 2015 | December 31, 2014 | ||||||
Finished goods inventory | |||||||
Real estate inventory (a) | $6,511 | $4,932 | |||||
New Zealand log inventory | 6,589 | 3,451 | |||||
Total inventory | $13,100 | $8,383 |
(a) | Represents HBU real estate (including capitalized development costs) expected to be sold within 12 months. |
15. | DEBT |
16. | ACCUMULATED OTHER COMPREHENSIVE INCOME/(LOSS) |
Foreign currency translation gains/ (losses) | Net investment hedge of New Zealand JV | New Zealand JV cash flow hedges | Unrecognized components of employee benefit plans | Total | |||||||||||||||
Balance as of December 31, 2013 | $36,914 | — | ($342 | ) | ($82,711 | ) | ($46,139 | ) | |||||||||||
Other comprehensive income/(loss) before reclassifications | (11,381 | ) | (145 | ) | 510 | 47,938 | (a) | 36,922 | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | — | (1,716 | ) | 6,108 | (b) | 4,392 | ||||||||||||
Net other comprehensive income/(loss) | (11,381 | ) | (145 | ) | (1,206 | ) | 54,046 | 41,314 | |||||||||||
Balance as of December 31, 2014 | $25,533 | ($145 | ) | ($1,548 | ) | ($28,665 | ) | ($4,825 | ) | ||||||||||
Other comprehensive income/(loss) before reclassifications | (11,020 | ) | 591 | (907 | ) | — | (11,336 | ) | |||||||||||
Amounts reclassified from accumulated other comprehensive loss | — | — | 292 | 781 | (c) | 1,073 | |||||||||||||
Net other comprehensive income/(loss) | (11,020 | ) | 591 | (615 | ) | 781 | (10,263 | ) | |||||||||||
Balance as of March 31, 2015 | $14,513 | $446 | ($2,163 | ) | ($27,884 | ) | ($15,088 | ) |
(a) | Reflects $78 million, net of taxes, of comprehensive income due to the transfer of losses to Rayonier Advanced Materials Pension Plans. This comprehensive income was offset by $30 million, net of taxes, of losses as a result of revaluations required due to the spin-off and at December 31, 2014. See Note 22 — Employee Benefit Plans in the 2014 Form 10-K for additional information. |
(b) | This accumulated other comprehensive income component is comprised of $5 million from the computation of net periodic pension cost and the $1 million write-off of a deferred tax asset related to the revaluation and transfer of liabilities as a result of the spin-off. |
(c) | This component of other comprehensive income is included in the computation of net periodic pension cost. See Note 13 — Employee Benefit Plans for additional information. |
Details about accumulated other comprehensive income components | Amount reclassified from accumulated other comprehensive income | Affected line item in the income statement | ||||||||
March 31, 2015 | March 31, 2014 | |||||||||
Realized loss (gain) on foreign currency exchange contracts | $364 | ($872 | ) | Other operating income, net | ||||||
Realized loss (gain) on foreign currency option contracts | 293 | (107 | ) | Other operating income, net | ||||||
Noncontrolling interest | (230 | ) | 343 | Comprehensive (loss) income attributable to noncontrolling interest | ||||||
Income tax (benefit) expense on loss from foreign currency contracts | (135 | ) | 144 | Income tax benefit | ||||||
Net loss (gain) on cash flow hedges reclassified from accumulated other comprehensive income | $292 | ($492 | ) |
17. | OTHER OPERATING INCOME, NET |
Three Months Ended March 31, | |||||||
2015 | 2014 | ||||||
Lease income, primarily from hunting leases | $4,109 | $3,036 | |||||
Other non-timber income | 1,364 | 552 | |||||
Foreign currency losses | (241 | ) | (1,519 | ) | |||
Loss on foreign currency exchange contracts | — | (32 | ) | ||||
Miscellaneous income (expense), net | 342 | (1,662 | ) | ||||
Total | $5,574 | $375 |
18. | CONSOLIDATING FINANCIAL STATEMENTS |
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
SALES | — | — | — | $140,305 | — | $140,305 | |||||||||||||||||
Costs and Expenses | |||||||||||||||||||||||
Cost of sales | — | — | — | 107,234 | — | 107,234 | |||||||||||||||||
Selling and general expenses | — | 4,949 | — | 5,949 | — | 10,898 | |||||||||||||||||
Other operating income, net | — | — | — | (5,574 | ) | — | (5,574 | ) | |||||||||||||||
— | 4,949 | — | 107,609 | — | 112,558 | ||||||||||||||||||
OPERATING (LOSS) INCOME | — | (4,949 | ) | — | 32,696 | — | 27,747 | ||||||||||||||||
Interest expense | (3,168 | ) | (92 | ) | (2,432 | ) | (2,852 | ) | — | (8,544 | ) | ||||||||||||
Interest and miscellaneous income (expense), net | 1,936 | 837 | (144 | ) | (4,123 | ) | — | (1,494 | ) | ||||||||||||||
Equity in income (loss) from subsidiaries | 18,979 | 23,183 | 1,427 | — | (43,589 | ) | — | ||||||||||||||||
INCOME (LOSS) FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 17,747 | 18,979 | (1,149 | ) | 25,721 | (43,589 | ) | 17,709 | |||||||||||||||
Income tax benefit (expense) | — | — | 960 | (489 | ) | — | 471 | ||||||||||||||||
NET INCOME (LOSS) | 17,747 | 18,979 | (189 | ) | 25,232 | (43,589 | ) | 18,180 | |||||||||||||||
Less: Net income attributable to noncontrolling interest | — | — | — | 433 | — | 433 | |||||||||||||||||
NET INCOME (LOSS) ATTRIBUTABLE TO RAYONIER INC. | 17,747 | 18,979 | (189 | ) | 24,799 | (43,589 | ) | 17,747 | |||||||||||||||
OTHER COMPREHENSIVE (LOSS) INCOME | |||||||||||||||||||||||
Foreign currency translation adjustment | (10,430 | ) | (10,430 | ) | (852 | ) | (14,323 | ) | 21,712 | (14,323 | ) | ||||||||||||
New Zealand joint venture cash flow hedges | (615 | ) | (615 | ) | (615 | ) | (946 | ) | 1,845 | (946 | ) | ||||||||||||
Amortization of pension and postretirement plans, net of income tax | 781 | 781 | 20 | 20 | (821 | ) | 781 | ||||||||||||||||
Total other comprehensive loss | (10,264 | ) | (10,264 | ) | (1,447 | ) | (15,249 | ) | 22,736 | (14,488 | ) | ||||||||||||
COMPREHENSIVE INCOME (LOSS) | 7,483 | 8,715 | (1,636 | ) | 9,983 | (20,853 | ) | 3,692 | |||||||||||||||
Less: Comprehensive loss attributable to noncontrolling interest | — | — | — | (3,791 | ) | — | (3,791 | ) | |||||||||||||||
COMPREHENSIVE INCOME (LOSS) ATTRIBUTABLE TO RAYONIER INC. | $7,483 | $8,715 | ($1,636 | ) | $13,774 | ($20,853 | ) | $7,483 | |||||||||||||||
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Three Months Ended March 31, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non-guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
SALES | — | — | — | $143,187 | — | $143,187 | |||||||||||||||||
Costs and Expenses | |||||||||||||||||||||||
Cost of sales | — | — | — | 115,900 | — | 115,900 | |||||||||||||||||
Selling and general expenses | — | 2,150 | — | 11,087 | — | 13,237 | |||||||||||||||||
Other operating expense (income), net | — | 2,375 | — | (2,750 | ) | — | (375 | ) | |||||||||||||||
— | 4,525 | — | 124,237 | — | 128,762 | ||||||||||||||||||
OPERATING (LOSS) INCOME | — | (4,525 | ) | — | 18,950 | — | 14,425 | ||||||||||||||||
Interest expense | (3,193 | ) | (243 | ) | (6,690 | ) | (549 | ) | — | (10,675 | ) | ||||||||||||
Interest and miscellaneous income (expense), net | 2,698 | 814 | (1,047 | ) | (3,476 | ) | — | (1,011 | ) | ||||||||||||||
Equity in income from subsidiaries | 41,921 | 46,478 | 31,110 | — | (119,509 | ) | — | ||||||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 41,426 | 42,524 | 23,373 | 14,925 | (119,509 | ) | 2,739 | ||||||||||||||||
Income tax (expense) benefit | — | (603 | ) | 2,824 | 5,375 | — | 7,596 | ||||||||||||||||
INCOME FROM CONTINUING OPERATIONS | 41,426 | 41,921 | 26,197 | 20,300 | (119,509 | ) | 10,335 | ||||||||||||||||
DISCONTINUED OPERATIONS, NET | |||||||||||||||||||||||
Income from discontinued operations, net of income taxes | — | — | — | 31,008 | — | 31,008 | |||||||||||||||||
NET INCOME | 41,426 | 41,921 | 26,197 | 51,308 | (119,509 | ) | 41,343 | ||||||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | — | (83 | ) | — | (83 | ) | |||||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 41,426 | 41,921 | 26,197 | 51,391 | (119,509 | ) | 41,426 | ||||||||||||||||
OTHER COMPREHENSIVE INCOME | |||||||||||||||||||||||
Foreign currency translation adjustment | 12,894 | 12,893 | 766 | 17,795 | (26,545 | ) | 17,803 | ||||||||||||||||
New Zealand joint venture cash flow hedges | 1,112 | 1,112 | 1,112 | 1,711 | (3,336 | ) | 1,711 | ||||||||||||||||
Amortization of pension and postretirement plans, net of income tax | 2,097 | 2,097 | 1,620 | 1,620 | (5,337 | ) | 2,097 | ||||||||||||||||
Total other comprehensive income | 16,103 | 16,102 | 3,498 | 21,126 | (35,218 | ) | 21,611 | ||||||||||||||||
COMPREHENSIVE INCOME | 57,529 | 58,023 | 29,695 | 72,434 | (154,727 | ) | 62,954 | ||||||||||||||||
Less: Comprehensive income attributable to noncontrolling interest | — | — | — | 5,425 | — | 5,425 | |||||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $57,529 | $58,023 | $29,695 | $67,009 | ($154,727 | ) | $57,529 | ||||||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEETS As of March 31, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
ASSETS | |||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||
Cash and cash equivalents | $77,738 | $4,282 | $1,287 | $55,742 | — | $139,049 | |||||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | — | 182 | 19,778 | — | 19,960 | |||||||||||||||||
Inventory | — | — | — | 13,100 | — | 13,100 | |||||||||||||||||
Prepaid and other current assets | — | 2,075 | 2,120 | 13,845 | — | 18,040 | |||||||||||||||||
Total current assets | 77,738 | 6,357 | 3,589 | 102,465 | — | 190,149 | |||||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | — | 2,073,024 | — | 2,073,024 | |||||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | — | 71,952 | — | 71,952 | |||||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 390 | — | 6,202 | — | 6,592 | |||||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,465,487 | 1,946,368 | 650,156 | — | (4,062,011 | ) | — | ||||||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 250,530 | — | 21,713 | — | (272,243 | ) | — | ||||||||||||||||
OTHER ASSETS | 2,667 | 16,538 | 1,516 | 50,112 | — | 70,833 | |||||||||||||||||
TOTAL ASSETS | $1,796,422 | $1,969,653 | $676,974 | $2,303,755 | ($4,334,254 | ) | $2,412,550 | ||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||
Accounts payable | — | $1,809 | $31 | $20,388 | — | $22,228 | |||||||||||||||||
Current maturities of long-term debt | — | — | 130,213 | — | — | 130,213 | |||||||||||||||||
Accrued taxes | — | 11 | — | 12,450 | — | 12,461 | |||||||||||||||||
Accrued payroll and benefits | — | 1,282 | — | 1,714 | — | 2,996 | |||||||||||||||||
Accrued interest | 6,095 | (8 | ) | 1,047 | 33,468 | (30,710 | ) | 9,892 | |||||||||||||||
Other current liabilities | — | 788 | (69 | ) | 18,283 | — | 19,002 | ||||||||||||||||
Total current liabilities | 6,095 | 3,882 | 131,222 | 86,303 | (30,710 | ) | 196,792 | ||||||||||||||||
LONG-TERM DEBT | 325,000 | — | 33,759 | 254,045 | — | 612,804 | |||||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,345 | — | (684 | ) | — | 33,661 | ||||||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,623 | — | 14,454 | — | 21,077 | |||||||||||||||||
INTERCOMPANY PAYABLE | — | 459,316 | — | (201,620 | ) | (257,696 | ) | — | |||||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,465,327 | 1,465,487 | 511,993 | 2,068,368 | (4,045,848 | ) | 1,465,327 | ||||||||||||||||
Noncontrolling interest | — | — | — | 82,889 | — | 82,889 | |||||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,465,327 | 1,465,487 | 511,993 | 2,151,257 | (4,045,848 | ) | 1,548,216 | ||||||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,796,422 | $1,969,653 | $676,974 | $2,303,755 | ($4,334,254 | ) | $2,412,550 |
CONDENSED CONSOLIDATING BALANCE SHEETS As of December 31, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
ASSETS | |||||||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||||||
Cash and cash equivalents | $102,218 | $11 | $8,094 | $51,235 | — | $161,558 | |||||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | — | 1,409 | 22,609 | — | 24,018 | |||||||||||||||||
Inventory | — | — | — | 8,383 | — | 8,383 | |||||||||||||||||
Prepaid and other current assets | — | 2,003 | 6 | 17,736 | — | 19,745 | |||||||||||||||||
Total current assets | 102,218 | 2,014 | 9,509 | 99,963 | — | 213,704 | |||||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | — | 2,088,501 | — | 2,088,501 | |||||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | — | 77,433 | — | 77,433 | |||||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 433 | — | 6,273 | — | 6,706 | |||||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,463,303 | 1,923,185 | 640,678 | — | (4,027,166 | ) | — | ||||||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 248,233 | — | 21,500 | — | (269,733 | ) | — | ||||||||||||||||
OTHER ASSETS | 2,763 | 16,610 | 1,759 | 45,639 | — | 66,771 | |||||||||||||||||
TOTAL ASSETS | $1,816,517 | $1,942,242 | $673,446 | $2,317,809 | ($4,296,899 | ) | $2,453,115 | ||||||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||||||
Accounts payable | — | $2,687 | $123 | $17,401 | — | $20,211 | |||||||||||||||||
Current maturities of long-term debt | — | — | 129,706 | — | — | 129,706 | |||||||||||||||||
Accrued taxes | — | 11 | — | 11,394 | — | 11,405 | |||||||||||||||||
Accrued payroll and benefits | — | 3,253 | — | 3,137 | — | 6,390 | |||||||||||||||||
Accrued interest | 3,047 | (3 | ) | 2,520 | 31,281 | (28,412 | ) | 8,433 | |||||||||||||||
Other current liabilities | — | 928 | 145 | 24,784 | — | 25,857 | |||||||||||||||||
Total current liabilities | 3,047 | 6,876 | 132,494 | 87,997 | (28,412 | ) | 202,002 | ||||||||||||||||
LONG-TERM DEBT | 325,000 | — | 31,000 | 265,849 | — | 621,849 | |||||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,161 | — | (684 | ) | — | 33,477 | ||||||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,436 | — | 14,200 | — | 20,636 | |||||||||||||||||
INTERCOMPANY PAYABLE | — | 431,466 | — | (153,754 | ) | (277,712 | ) | — | |||||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 509,952 | 2,017,520 | (3,990,775 | ) | 1,488,470 | ||||||||||||||||
Noncontrolling interest | — | — | — | 86,681 | — | 86,681 | |||||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 509,952 | 2,104,201 | (3,990,775 | ) | 1,575,151 | ||||||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,816,517 | $1,942,242 | $673,446 | $2,317,809 | ($4,296,899 | ) | $2,453,115 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 2015 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
CASH PROVIDED BY OPERATING ACTIVITIES | $6,735 | $13,604 | — | $42,105 | ($9,046 | ) | $53,398 | ||||||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||||||
Capital expenditures | — | — | — | (13,292 | ) | — | (13,292 | ) | |||||||||||||||
Real estate development costs | — | — | — | (306 | ) | — | (306 | ) | |||||||||||||||
Purchase of timberlands | — | — | — | (23,070 | ) | — | (23,070 | ) | |||||||||||||||
Change in restricted cash | — | — | — | (7,071 | ) | — | (7,071 | ) | |||||||||||||||
Investment in Subsidiaries | — | — | (8,807 | ) | — | 8,807 | — | ||||||||||||||||
CASH USED FOR INVESTING ACTIVITIES | — | — | (8,807 | ) | (43,739 | ) | 8,807 | (43,739 | ) | ||||||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||||||
Issuance of debt | — | — | 12,000 | — | — | 12,000 | |||||||||||||||||
Repayment of debt | — | — | (10,000 | ) | (1,371 | ) | — | (11,371 | ) | ||||||||||||||
Dividends paid | (31,667 | ) | — | — | — | — | (31,667 | ) | |||||||||||||||
Proceeds from the issuance of common shares | 546 | — | — | — | — | 546 | |||||||||||||||||
Repurchase of common shares | (94 | ) | — | — | — | — | (94 | ) | |||||||||||||||
Intercompany distributions | — | (9,333 | ) | — | 9,094 | 239 | — | ||||||||||||||||
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES | (31,215 | ) | (9,333 | ) | 2,000 | 7,723 | 239 | (30,586 | ) | ||||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | — | (1,582 | ) | — | (1,582 | ) | |||||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||||||
Change in cash and cash equivalents | (24,480 | ) | 4,271 | (6,807 | ) | 4,507 | — | (22,509 | ) | ||||||||||||||
Balance, beginning of year | 102,218 | 11 | 8,094 | 51,235 | — | 161,558 | |||||||||||||||||
Balance, end of period | $77,738 | $4,282 | $1,287 | $55,742 | — | $139,049 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 2014 | |||||||||||||||||||||||
Rayonier Inc. (Parent Guarantor) | ROC (Subsidiary Guarantor) | Rayonier TRS Holdings Inc. (Issuer) | Non- guarantors | Consolidating Adjustments | Total Consolidated | ||||||||||||||||||
CASH PROVIDED BY OPERATING ACTIVITIES | $25,931 | $32,794 | — | $68,585 | ($27,210 | ) | $100,100 | ||||||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||||||
Capital expenditures | — | (170 | ) | — | (34,470 | ) | — | (34,640 | ) | ||||||||||||||
Real estate development costs | — | — | — | (1,812 | ) | — | (1,812 | ) | |||||||||||||||
Purchase of timberlands | — | — | — | (10,637 | ) | — | (10,637 | ) | |||||||||||||||
Change in restricted cash | — | — | — | 45,312 | — | 45,312 | |||||||||||||||||
Investment in Subsidiaries | — | — | 69,103 | — | (69,103 | ) | — | ||||||||||||||||
Other | — | — | — | (778 | ) | — | (778 | ) | |||||||||||||||
CASH (USED FOR) PROVIDED BY INVESTING ACTIVITIES | — | (170 | ) | 69,103 | (2,385 | ) | (69,103 | ) | (2,555 | ) | |||||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||||||
Issuance of debt | — | — | 30,000 | 1,819 | — | 31,819 | |||||||||||||||||
Repayment of debt | — | — | (110,000 | ) | — | — | (110,000 | ) | |||||||||||||||
Dividends paid | (62,545 | ) | — | — | — | — | (62,545 | ) | |||||||||||||||
Proceeds from the issuance of common shares | 2,027 | — | — | — | — | 2,027 | |||||||||||||||||
Repurchase of common shares | (1,754 | ) | — | — | — | — | (1,754 | ) | |||||||||||||||
Intercompany distributions | — | (28,434 | ) | — | (67,879 | ) | 96,313 | — | |||||||||||||||
Other | — | — | — | (678 | ) | — | (678 | ) | |||||||||||||||
CASH USED FOR FINANCING ACTIVITIES | (62,272 | ) | (28,434 | ) | (80,000 | ) | (66,738 | ) | 96,313 | (141,131 | ) | ||||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | — | 13 | — | 13 | |||||||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||||||
Change in cash and cash equivalents | (36,341 | ) | 4,190 | (10,897 | ) | (525 | ) | — | (43,573 | ) | |||||||||||||
Balance, beginning of year | 130,181 | 304 | 10,719 | 58,440 | — | 199,644 | |||||||||||||||||
Balance, end of period | $93,840 | $4,494 | ($178 | ) | $57,915 | — | $156,071 |
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Three Months Ended March 31, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
SALES | — | — | $140,305 | — | $140,305 | ||||||||||||||
Costs and Expenses | |||||||||||||||||||
Cost of sales | — | — | 107,234 | — | 107,234 | ||||||||||||||
Selling and general expenses | — | 4,949 | 5,949 | — | 10,898 | ||||||||||||||
Other operating income, net | — | — | (5,574 | ) | — | (5,574 | ) | ||||||||||||
— | 4,949 | 107,609 | — | 112,558 | |||||||||||||||
OPERATING (LOSS) INCOME | — | (4,949 | ) | 32,696 | — | 27,747 | |||||||||||||
Interest expense | (3,168 | ) | (2,524 | ) | (2,852 | ) | — | (8,544 | ) | ||||||||||
Interest and miscellaneous income (expense), net | 1,936 | 693 | (4,123 | ) | — | (1,494 | ) | ||||||||||||
Equity in income from subsidiaries | 18,979 | 24,799 | — | (43,778 | ) | — | |||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 17,747 | 18,019 | 25,721 | (43,778 | ) | 17,709 | |||||||||||||
Income tax benefit (expense) | — | 960 | (489 | ) | — | 471 | |||||||||||||
NET INCOME | 17,747 | 18,979 | 25,232 | (43,778 | ) | 18,180 | |||||||||||||
Less: Net income attributable to noncontrolling interest | — | — | 433 | — | 433 | ||||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 17,747 | 18,979 | 24,799 | (43,778 | ) | 17,747 | |||||||||||||
OTHER COMPREHENSIVE (LOSS) INCOME | |||||||||||||||||||
Foreign currency translation adjustment | (10,430 | ) | (10,430 | ) | (14,323 | ) | 20,860 | (14,323 | ) | ||||||||||
New Zealand joint venture cash flow hedges | (615 | ) | (615 | ) | (946 | ) | 1,230 | (946 | ) | ||||||||||
Amortization of pension and postretirement plans, net of income tax | 781 | 781 | 20 | (801 | ) | 781 | |||||||||||||
Total other comprehensive loss | (10,264 | ) | (10,264 | ) | (15,249 | ) | 21,289 | (14,488 | ) | ||||||||||
COMPREHENSIVE INCOME | 7,483 | 8,715 | 9,983 | (22,489 | ) | 3,692 | |||||||||||||
Less: Comprehensive loss attributable to noncontrolling interest | — | — | (3,791 | ) | — | (3,791 | ) | ||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $7,483 | $8,715 | $13,774 | ($22,489 | ) | $7,483 | |||||||||||||
CONSOLIDATING STATEMENTS OF INCOME AND COMPREHENSIVE INCOME For the Three Months Ended March 31, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
SALES | — | — | $143,187 | — | $143,187 | ||||||||||||||
Costs and Expenses | |||||||||||||||||||
Cost of sales | — | — | 115,900 | — | 115,900 | ||||||||||||||
Selling and general expenses | — | 2,150 | 11,087 | — | 13,237 | ||||||||||||||
Other operating expense (income), net | — | 2,375 | (2,750 | ) | — | (375 | ) | ||||||||||||
— | 4,525 | 124,237 | — | 128,762 | |||||||||||||||
OPERATING (LOSS) INCOME | — | (4,525 | ) | 18,950 | — | 14,425 | |||||||||||||
Interest expense | (3,193 | ) | (6,933 | ) | (549 | ) | — | (10,675 | ) | ||||||||||
Interest and miscellaneous income (expense), net | 2,698 | (233 | ) | (3,476 | ) | — | (1,011 | ) | |||||||||||
Equity in income from subsidiaries | 41,921 | 51,391 | — | (93,312 | ) | — | |||||||||||||
INCOME FROM CONTINUING OPERATIONS BEFORE INCOME TAXES | 41,426 | 39,700 | 14,925 | (93,312 | ) | 2,739 | |||||||||||||
Income tax benefit | — | 2,221 | 5,375 | — | 7,596 | ||||||||||||||
INCOME FROM CONTINUING OPERATIONS | 41,426 | 41,921 | 20,300 | (93,312 | ) | 10,335 | |||||||||||||
DISCONTINUED OPERATIONS, NET | |||||||||||||||||||
Income from discontinued operations, net of income tax | — | — | 31,008 | — | 31,008 | ||||||||||||||
NET INCOME | 41,426 | 41,921 | 51,308 | (93,312 | ) | 41,343 | |||||||||||||
Less: Net loss attributable to noncontrolling interest | — | — | (83 | ) | — | (83 | ) | ||||||||||||
NET INCOME ATTRIBUTABLE TO RAYONIER INC. | 41,426 | 41,921 | 51,391 | (93,312 | ) | 41,426 | |||||||||||||
OTHER COMPREHENSIVE INCOME | |||||||||||||||||||
Foreign currency translation adjustment | 12,894 | 12,892 | 17,795 | (25,778 | ) | 17,803 | |||||||||||||
New Zealand joint venture cash flow hedges | 1,112 | 1,112 | 1,711 | (2,224 | ) | 1,711 | |||||||||||||
Amortization of pension and postretirement plans, net of income tax | 2,097 | 2,097 | 1,620 | (3,717 | ) | 2,097 | |||||||||||||
Total other comprehensive income | 16,103 | 16,101 | 21,126 | (31,719 | ) | 21,611 | |||||||||||||
COMPREHENSIVE INCOME | 57,529 | 58,022 | 72,434 | (125,031 | ) | 62,954 | |||||||||||||
Less: Comprehensive income attributable to noncontrolling interest | — | — | 5,425 | — | 5,425 | ||||||||||||||
COMPREHENSIVE INCOME ATTRIBUTABLE TO RAYONIER INC. | $57,529 | $58,022 | $67,009 | ($125,031 | ) | $57,529 | |||||||||||||
CONDENSED CONSOLIDATING BALANCE SHEETS As of March 31, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
ASSETS | |||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||
Cash and cash equivalents | $77,738 | $5,569 | $55,742 | — | $139,049 | ||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | 182 | 19,778 | — | 19,960 | ||||||||||||||
Inventory | — | — | 13,100 | — | 13,100 | ||||||||||||||
Prepaid and other current assets | — | 4,195 | 13,845 | — | 18,040 | ||||||||||||||
Total current assets | 77,738 | 9,946 | 102,465 | — | 190,149 | ||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | 2,073,024 | — | 2,073,024 | ||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | 71,952 | — | 71,952 | ||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 390 | 6,202 | — | 6,592 | ||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,465,487 | 2,084,531 | — | (3,550,018 | ) | — | |||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 250,530 | 21,713 | — | (272,243 | ) | — | |||||||||||||
OTHER ASSETS | 2,667 | 18,054 | 50,112 | — | 70,833 | ||||||||||||||
TOTAL ASSETS | $1,796,422 | $2,134,634 | $2,303,755 | ($3,822,261 | ) | $2,412,550 | |||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||
Accounts payable | — | $1,840 | $20,388 | — | $22,228 | ||||||||||||||
Current maturities of long-term debt | — | 130,213 | — | — | 130,213 | ||||||||||||||
Accrued taxes | — | 11 | 12,450 | — | 12,461 | ||||||||||||||
Accrued payroll and benefits | — | 1,282 | 1,714 | — | 2,996 | ||||||||||||||
Accrued interest | 6,095 | 1,039 | 33,468 | (30,710 | ) | 9,892 | |||||||||||||
Other current liabilities | — | 719 | 18,283 | — | 19,002 | ||||||||||||||
Total current liabilities | 6,095 | 135,104 | 86,303 | (30,710 | ) | 196,792 | |||||||||||||
LONG-TERM DEBT | 325,000 | 33,759 | 254,045 | — | 612,804 | ||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,345 | (684 | ) | — | 33,661 | |||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,623 | 14,454 | — | 21,077 | ||||||||||||||
INTERCOMPANY PAYABLE | — | 459,316 | (201,620 | ) | (257,696 | ) | — | ||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,465,327 | 1,465,487 | 2,068,368 | (3,533,855 | ) | 1,465,327 | |||||||||||||
Noncontrolling interest | — | — | 82,889 | — | 82,889 | ||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,465,327 | 1,465,487 | 2,151,257 | (3,533,855 | ) | 1,548,216 | |||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,796,422 | $2,134,634 | $2,303,755 | ($3,822,261 | ) | $2,412,550 |
CONDENSED CONSOLIDATING BALANCE SHEETS As of December 31, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
ASSETS | |||||||||||||||||||
CURRENT ASSETS | |||||||||||||||||||
Cash and cash equivalents | $102,218 | $8,105 | $51,235 | — | $161,558 | ||||||||||||||
Accounts receivable, less allowance for doubtful accounts | — | 1,409 | 22,609 | — | 24,018 | ||||||||||||||
Inventory | — | — | 8,383 | — | 8,383 | ||||||||||||||
Prepaid and other current assets | — | 2,009 | 17,736 | — | 19,745 | ||||||||||||||
Total current assets | 102,218 | 11,523 | 99,963 | — | 213,704 | ||||||||||||||
TIMBER AND TIMBERLANDS, NET OF DEPLETION AND AMORTIZATION | — | — | 2,088,501 | — | 2,088,501 | ||||||||||||||
HIGHER AND BETTER USE TIMBERLANDS AND REAL ESTATE DEVELOPMENT COSTS | — | — | 77,433 | — | 77,433 | ||||||||||||||
NET PROPERTY, PLANT AND EQUIPMENT | — | 433 | 6,273 | — | 6,706 | ||||||||||||||
INVESTMENT IN SUBSIDIARIES | 1,463,303 | 2,053,911 | — | (3,517,214 | ) | — | |||||||||||||
INTERCOMPANY NOTES RECEIVABLE | 248,233 | 21,500 | — | (269,733 | ) | — | |||||||||||||
OTHER ASSETS | 2,763 | 18,369 | 45,639 | — | 66,771 | ||||||||||||||
TOTAL ASSETS | $1,816,517 | $2,105,736 | $2,317,809 | ($3,786,947 | ) | $2,453,115 | |||||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||||||||||
CURRENT LIABILITIES | |||||||||||||||||||
Accounts payable | — | $2,810 | $17,401 | — | $20,211 | ||||||||||||||
Current maturities of long-term debt | — | 129,706 | — | — | 129,706 | ||||||||||||||
Accrued taxes | — | 11 | 11,394 | — | 11,405 | ||||||||||||||
Accrued payroll and benefits | — | 3,253 | 3,137 | — | 6,390 | ||||||||||||||
Accrued interest | 3,047 | 2,517 | 31,281 | (28,412 | ) | 8,433 | |||||||||||||
Other current liabilities | — | 1,073 | 24,784 | — | 25,857 | ||||||||||||||
Total current liabilities | 3,047 | 139,370 | 87,997 | (28,412 | ) | 202,002 | |||||||||||||
LONG-TERM DEBT | 325,000 | 31,000 | 265,849 | — | 621,849 | ||||||||||||||
PENSION AND OTHER POSTRETIREMENT BENEFITS | — | 34,161 | (684 | ) | — | 33,477 | |||||||||||||
OTHER NON-CURRENT LIABILITIES | — | 6,436 | 14,200 | — | 20,636 | ||||||||||||||
INTERCOMPANY PAYABLE | — | 431,466 | (153,754 | ) | (277,712 | ) | — | ||||||||||||
TOTAL RAYONIER INC. SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 2,017,520 | (3,480,823 | ) | 1,488,470 | |||||||||||||
Noncontrolling interest | — | — | 86,681 | — | 86,681 | ||||||||||||||
TOTAL SHAREHOLDERS’ EQUITY | 1,488,470 | 1,463,303 | 2,104,201 | (3,480,823 | ) | 1,575,151 | |||||||||||||
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY | $1,816,517 | $2,105,736 | $2,317,809 | ($3,786,947 | ) | $2,453,115 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 2015 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
CASH PROVIDED BY OPERATING ACTIVITIES | $6,735 | $13,604 | $42,105 | ($9,046 | ) | $53,398 | |||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||
Capital expenditures | — | — | (13,292 | ) | — | (13,292 | ) | ||||||||||||
Real estate development costs | — | — | (306 | ) | — | (306 | ) | ||||||||||||
Purchase of timberlands | — | — | (23,070 | ) | — | (23,070 | ) | ||||||||||||
Change in restricted cash | — | — | (7,071 | ) | — | (7,071 | ) | ||||||||||||
Investment in Subsidiaries | — | (8,807 | ) | — | 8,807 | — | |||||||||||||
CASH USED FOR INVESTING ACTIVITIES | — | (8,807 | ) | (43,739 | ) | 8,807 | (43,739 | ) | |||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||
Issuance of debt | — | 12,000 | — | — | 12,000 | ||||||||||||||
Repayment of debt | — | (10,000 | ) | (1,371 | ) | — | (11,371 | ) | |||||||||||
Dividends paid | (31,667 | ) | — | — | — | (31,667 | ) | ||||||||||||
Proceeds from the issuance of common shares | 546 | — | — | — | 546 | ||||||||||||||
Repurchase of common shares | (94 | ) | — | — | — | (94 | ) | ||||||||||||
Intercompany distributions | — | (9,333 | ) | 9,094 | 239 | — | |||||||||||||
CASH (USED FOR) PROVIDED BY FINANCING ACTIVITIES | (31,215 | ) | (7,333 | ) | 7,723 | 239 | (30,586 | ) | |||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | (1,582 | ) | — | (1,582 | ) | ||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||
Change in cash and cash equivalents | (24,480 | ) | (2,536 | ) | 4,507 | — | (22,509 | ) | |||||||||||
Balance, beginning of year | 102,218 | 8,105 | 51,235 | — | 161,558 | ||||||||||||||
Balance, end of period | $77,738 | $5,569 | $55,742 | — | $139,049 |
CONDENSED CONSOLIDATING STATEMENTS OF CASH FLOWS For the Three Months Ended March 31, 2014 | |||||||||||||||||||
Rayonier Inc. (Parent Issuer) | Subsidiary Guarantors | Non- guarantors | Consolidating Adjustments | Total Consolidated | |||||||||||||||
CASH PROVIDED BY OPERATING ACTIVITIES | $25,931 | $32,794 | $68,585 | ($27,210 | ) | $100,100 | |||||||||||||
INVESTING ACTIVITIES | |||||||||||||||||||
Capital expenditures | — | (170 | ) | (34,470 | ) | — | (34,640 | ) | |||||||||||
Real estate development costs | — | — | (1,812 | ) | — | (1,812 | ) | ||||||||||||
Purchase of timberlands | — | — | (10,637 | ) | — | (10,637 | ) | ||||||||||||
Change in restricted cash | — | — | 45,312 | — | 45,312 | ||||||||||||||
Investment in Subsidiaries | — | 69,103 | — | (69,103 | ) | — | |||||||||||||
Other | — | — | (778 | ) | — | (778 | ) | ||||||||||||
CASH PROVIDED BY (USED FOR) INVESTING ACTIVITIES | — | 68,933 | (2,385 | ) | (69,103 | ) | (2,555 | ) | |||||||||||
FINANCING ACTIVITIES | |||||||||||||||||||
Issuance of debt | — | 30,000 | 1,819 | — | 31,819 | ||||||||||||||
Repayment of debt | — | (110,000 | ) | — | — | (110,000 | ) | ||||||||||||
Dividends paid | (62,545 | ) | — | — | — | (62,545 | ) | ||||||||||||
Proceeds from the issuance of common shares | 2,027 | — | — | — | 2,027 | ||||||||||||||
Repurchase of common shares | (1,754 | ) | — | — | — | (1,754 | ) | ||||||||||||
Intercompany distributions | — | (28,434 | ) | (67,879 | ) | 96,313 | — | ||||||||||||
Other | — | — | (678 | ) | — | (678 | ) | ||||||||||||
CASH USED FOR FINANCING ACTIVITIES | (62,272 | ) | (108,434 | ) | (66,738 | ) | 96,313 | (141,131 | ) | ||||||||||
EFFECT OF EXCHANGE RATE CHANGES ON CASH | — | — | 13 | — | 13 | ||||||||||||||
CASH AND CASH EQUIVALENTS | |||||||||||||||||||
Change in cash and cash equivalents | (36,341 | ) | (6,707 | ) | (525 | ) | — | (43,573 | ) | ||||||||||
Balance, beginning of year | 130,181 | 11,023 | 58,440 | — | 199,644 | ||||||||||||||
Balance, end of period | $93,840 | $4,316 | $57,915 | — | $156,071 |
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
Three Months Ended March 31, | |||||||
Financial Information (in millions) | 2015 | 2014 | |||||
Sales | |||||||
Southern Timber | $35.5 | $33.9 | |||||
Pacific Northwest Timber | 19.2 | 33.0 | |||||
New Zealand Timber | 41.2 | 37.8 | |||||
Real Estate | |||||||
Improved Development | — | — | |||||
Unimproved Development | 4.8 | 0.1 | |||||
Rural | 6.8 | 5.1 | |||||
Non-Strategic / Timberlands | 12.2 | 0.3 | |||||
Total Real Estate | 23.8 | 5.5 | |||||
Trading | 20.6 | 35.7 | |||||
Intersegment Eliminations | — | (2.7 | ) | ||||
Total Sales | $140.3 | $143.2 | |||||
Operating Income | |||||||
Southern Timber | $12.4 | $10.5 | |||||
Pacific Northwest Timber | 2.6 | 12.6 | |||||
New Zealand Timber | 5.7 | 2.4 | |||||
Real Estate | 12.6 | 0.7 | |||||
Trading | 0.3 | (0.4 | ) | ||||
Corporate and other | (5.9 | ) | (11.4 | ) | |||
Operating Income | 27.7 | 14.4 | |||||
Interest Expense, Interest Income and Other | (10.0 | ) | (11.7 | ) | |||
Income Tax Benefit | 0.5 | 7.6 | |||||
Income from Continuing Operations | 18.2 | 10.3 | |||||
Discontinued Operations, Net | — | 31.0 | |||||
Net Income | 18.2 | 41.3 | |||||
Less: Net income (loss) attributable to noncontrolling interest | 0.5 | (0.1 | ) | ||||
Net Income Attributable to Rayonier Inc. | $17.7 | $41.4 | |||||
Adjusted EBITDA (a) | |||||||
Southern Timber | $26.7 | $22.5 | |||||
Pacific Northwest Timber | 6.4 | 18.9 | |||||
New Zealand Timber | 13.7 | 11.0 | |||||
Real Estate | 20.1 | 2.6 | |||||
Trading | 0.3 | (0.4 | ) | ||||
Corporate and Other | (5.8 | ) | (11.1 | ) | |||
Total Adjusted EBITDA (a) | $61.4 | $43.5 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended March 31, | |||||||
Southern Timber Overview | 2015 | 2014 | |||||
Sales Volume (in thousands of tons) | |||||||
Pine Pulpwood | 905 | 776 | |||||
Pine Sawtimber | 418 | 387 | |||||
Total Pine Volume | 1,323 | 1,163 | |||||
Hardwood | 47 | 111 | |||||
Total Volume | 1,370 | 1,274 | |||||
Percentage Delivered Sales | 25 | % | 30 | % | |||
Percentage Stumpage Sales | 75 | % | 70 | % | |||
Net Stumpage Pricing (dollars per ton) | |||||||
Pine Pulpwood | $18.83 | $18.55 | |||||
Pine Sawtimber | 28.84 | 27.07 | |||||
Weighted Average Pine | $21.99 | $21.38 | |||||
Hardwood | 13.07 | 13.73 | |||||
Weighted Average Total | $21.69 | $20.72 | |||||
Summary Financial Data (in millions of dollars) | |||||||
Sales | $35.5 | $33.9 | |||||
Less: Cut and Haul | (5.8 | ) | (7.5 | ) | |||
Net Stumpage Sales | $29.7 | $26.4 | |||||
Operating Income | $12.4 | $10.5 | |||||
Adjusted EBITDA (a) | $26.7 | $22.5 | |||||
Other Data | |||||||
Non-Timber Income (in millions of dollars) | $4.5 | $3.1 | |||||
Period-End Acres (in thousands) | 1,901 | 1,898 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Sales (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $33.9 | |||
Changes Attributable to: | ||||
Volume/Mix | 1.0 | |||
Price | 0.6 | |||
March 31, 2015 | $35.5 |
Operating Income (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $10.5 | |||
Changes Attributable to: | ||||
Volume/Mix | 1.2 | |||
Price | 0.8 | |||
Cost | (0.5 | ) | ||
Non-timber income | 1.5 | |||
Depreciation, depletion and amortization | (1.1 | ) | ||
March 31, 2015 | $12.4 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | |||
March 31, 2014 | $22.5 | |||
Changes Attributable to: | ||||
Volume/Mix | 2.5 | |||
Price | 0.8 | |||
Cost | (0.5 | ) | ||
Non-timber income | 1.5 | |||
Other | (0.1 | ) | ||
March 31, 2015 | $26.7 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended March 31, | |||||||
Pacific Northwest Timber Overview | 2015 | 2014 | |||||
Sales Volume (in thousands of tons) | |||||||
Pulpwood | 55 | 86 | |||||
Sawtimber | 270 | 458 | |||||
Total Volume | 325 | 544 | |||||
Sales Volume (converted to MBF) | |||||||
Pulpwood | 5,140 | 8,111 | |||||
Sawtimber | 33,455 | 54,570 | |||||
Total Volume | 38,595 | 62,681 | |||||
Percentage Delivered Sales | 79 | % | 47 | % | |||
Percentage Stumpage Sales | 21 | % | 53 | % | |||
Delivered Log Pricing (in dollars per ton) | |||||||
Pulpwood | $43.19 | $37.92 | |||||
Sawtimber | 72.03 | 81.90 | |||||
Weighted Average Log Price | $66.91 | $74.00 | |||||
Summary Financial Data (in millions of dollars) | |||||||
Sales | $19.2 | $33.0 | |||||
Less: Cut and Haul | (8.1 | ) | (8.3 | ) | |||
Net Stumpage Sales | $11.1 | $24.7 | |||||
Operating Income | $2.6 | $12.6 | |||||
Adjusted EBITDA (a) | $6.4 | $18.9 | |||||
Other Data | |||||||
Non-Timber Income (in millions of dollars) | $1.0 | $0.5 | |||||
Period-End Acres (in thousands) | 368 | 372 | |||||
Sawtimber (in dollars per MBF) | $604 | $684 | |||||
Estimated Percentage of Export Volume | 19 | % | 27 | % |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Sales (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $33.0 | |||
Changes Attributable to: | ||||
Volume/Mix | (10.7 | ) | ||
Price | (3.2 | ) | ||
Other | 0.1 | |||
March 31, 2015 | $19.2 |
Operating Income (in millions of dollars) | Three Months Ended | ||||
March 31, 2014 | $12.6 | ||||
Changes Attributable to: | |||||
Volume/Mix | (7.3 | ) | |||
Price | (2.8 | ) | |||
Cost | (0.4 | ) | |||
Non-timber income | 0.5 | ||||
March 31, 2015 | $2.6 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | |||
March 31, 2014 | $18.9 | |||
Changes Attributable to: | ||||
Volume/Mix | (9.8 | ) | ||
Price | (2.8 | ) | ||
Cost | (0.4 | ) | ||
Non-timber income | 0.5 | |||
March 31, 2015 | $6.4 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended March 31, | |||||||
New Zealand Timber Overview | 2015 | 2014 | |||||
Sales Volume (in thousands of tons) | |||||||
Domestic Sawtimber (Delivered) | 150 | 144 | |||||
Domestic Pulpwood (Delivered) | 100 | 73 | |||||
Export Sawtimber (Delivered) | 201 | 142 | |||||
Export Pulpwood (Delivered) | 11 | 9 | |||||
Stumpage | 76 | 91 | |||||
Total Volume | 538 | 459 | |||||
Percentage Delivered Sales | 86 | % | 80 | % | |||
Percentage Stumpage Sales | 14 | % | 20 | % | |||
Delivered Log Pricing (in dollars per ton) | |||||||
Domestic Sawtimber | $70.77 | $80.04 | |||||
Domestic Pulpwood | $35.38 | $38.34 | |||||
Export Sawtimber | $102.60 | $120.62 | |||||
Summary Financial Data (in millions of dollars) | |||||||
Sales | $37.8 | $35.8 | |||||
Less: Cut and Haul | (16.0 | ) | (15.9 | ) | |||
Less: Port and Freight Costs | (6.6 | ) | (5.6 | ) | |||
Net Stumpage Sales | $15.2 | $14.3 | |||||
Land Sales | 3.4 | 2.0 | |||||
Total Sales | $41.2 | $37.8 | |||||
Operating Income | $5.7 | $2.4 | |||||
Adjusted EBITDA (a) | $13.7 | $11.0 | |||||
Other Data | |||||||
New Zealand Dollar to U.S. Dollar Exchange Rate (b) | 0.7556 | 0.8253 | |||||
Net Plantable Period-End Acres (in thousands) | 303 | 313 | |||||
Export Sawtimber (in dollars per JAS m3) | $119.04 | $139.95 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
(b) | Represents the average period rate. |
Sales (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $37.8 | |||
Changes Attributable to: | ||||
Volume/Mix | 8.4 | |||
Price | (6.4 | ) | ||
Other | 1.4 | |||
March 31, 2015 | $41.2 |
Operating Income (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $2.4 | |||
Changes Attributable to: | ||||
Volume/Mix | 1.9 | |||
Price | (1.3 | ) | ||
Cost | 0.3 | |||
Non-timber income (a) | 0.7 | |||
Foreign exchange | (0.1 | ) | ||
Depreciation, depletion and amortization | 1.4 | |||
Non-cash cost of land and real estate development costs recovered upon sale | 2.1 | |||
Other (b) | (1.7 | ) | ||
March 31, 2015 | $5.7 |
(a) | Primarily related to timber sold in conjunction with the relinquishment of a forestry right. |
(b) | Includes $1.9 million of timber basis sold in conjunction with the relinquishment of a forestry right. |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | |||
March 31, 2014 | $11.0 | |||
Changes Attributable to: | ||||
Volume/Mix | 2.9 | |||
Price | (1.3 | ) | ||
Cost | 0.3 | |||
Non-timber income | 0.7 | |||
Foreign exchange | (0.1 | ) | ||
Other | 0.2 | |||
March 31, 2015 | $13.7 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Three Months Ended March 31, | |||||||
Timber Segments Selected Operating Information | 2015 | 2014 | |||||
Depreciation, Depletion and Amortization (in millions of dollars) | |||||||
Southern Timber | $14.3 | $12.0 | |||||
Pacific Northwest Timber | 3.8 | 6.3 | |||||
New Zealand Timber | 8.0 | 6.5 | |||||
Total | $26.1 | $24.8 | |||||
Timber Capital Expenditures (in millions of dollars) | |||||||
U.S. Timber | |||||||
Reforestation, silvicultural and other capital expenditures | $4.8 | $5.4 | |||||
Property taxes, lease payments and allocated overhead | 5.5 | 6.3 | |||||
Timberland acquisitions | 23.1 | 10.6 | |||||
Subtotal U.S. Timber | $33.4 | $22.3 | |||||
New Zealand Timber | |||||||
Reforestation, silvicultural and other capital expenditures | 1.5 | 1.8 | |||||
Property taxes, lease payments and allocated overhead | 1.2 | 1.3 | |||||
Subtotal New Zealand Timber | $2.7 | $3.1 | |||||
Total Timber Segments Capital Expenditures | $36.1 | $25.4 |
Three Months Ended March 31, | |||||||
Real Estate Overview | 2015 | 2014 | |||||
Sales (in millions of dollars) | |||||||
Improved Development (a) | — | — | |||||
Unimproved Development | 4.8 | 0.1 | |||||
Rural (b) | 6.8 | 5.1 | |||||
Non-Strategic / Timberlands (b) | 12.2 | 0.3 | |||||
Total Sales | $23.8 | $5.5 | |||||
Sales (Development and Rural Only) | $11.6 | $5.2 | |||||
Acres Sold | |||||||
Improved Development (a) | — | — | |||||
Unimproved Development | 409 | 27 | |||||
Rural (b) | 2,877 | 1,733 | |||||
Non-Strategic / Timberlands (b) | 4,111 | 362 | |||||
Total Acres Sold | 7,397 | 2,122 | |||||
Acre Sold (Development and Rural Only) | 3,286 | 1,760 | |||||
Percentage of U.S. South acreage sold (c) | 0.2 | % | 0.1 | % | |||
Price per Acre (dollars per acre) | |||||||
Improved Development (a) | — | — | |||||
Unimproved Development | $11,781 | $5,259 | |||||
Rural (b) | 2,368 | 2,958 | |||||
Non-Strategic / Timberlands (b) | 2,957 | 723 | |||||
Weighted Average (Total) | $3,216 | $2,606 | |||||
Weighted Average (Development and Rural) (d) | $3,540 | $2,994 |
(a) | Reflects land with capital invested in infrastructure improvements. |
(b) | Conservation sales previously reported as Rural are now reported with Non-Strategic / Timberlands. |
(c) | Calculated as Southern development and rural acres sold over U.S. South acres owned. |
(d) | Excludes Improved Development. |
Sales (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $5.5 | |||
Changes Attributable to: | ||||
Volume/Mix | 8.1 | |||
Price | 10.2 | |||
March 31, 2015 | $23.8 |
Operating Income (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $0.7 | |||
Changes Attributable to: | ||||
Volume/Mix | 8.5 | |||
Price | 4.5 | |||
Depreciation, depletion and amortization | (0.8 | ) | ||
Non-cash cost of land and real estate development costs recovered upon sale | (0.3 | ) | ||
March 31, 2015 | $12.6 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | |||
March 31, 2014 | $2.6 | |||
Changes Attributable to: | ||||
Volume/Mix | 13.0 | |||
Price | 4.5 | |||
March 31, 2015 | $20.1 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
Sales (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | $35.7 | |||
Changes Attributable to: | ||||
Volume/Other | (7.9 | ) | ||
Price | (6.9 | ) | ||
Other | (0.3 | ) | ||
March 31, 2015 | $20.6 |
Operating Income (in millions of dollars) | Three Months Ended | |||
March 31, 2014 | ($0.4 | ) | ||
Changes Attributable to: | ||||
Foreign exchange | 1.1 | |||
Other | (0.4 | ) | ||
March 31, 2015 | $0.3 |
Adjusted EBITDA (in millions of dollars) (a) | Three Months Ended | |||
March 31, 2014 | ($0.4 | ) | ||
Changes Attributable to: | ||||
Foreign exchange | 1.1 | |||
Other | (0.4 | ) | ||
March 31, 2015 | $0.3 |
(a) | Adjusted EBITDA is a non-GAAP measure defined and reconciled in Performance and Liquidity Indicators. |
March 31, | December 31, | ||||||
(millions of dollars) | 2015 | 2014 | |||||
Cash and cash equivalents | $139.0 | $161.6 | |||||
Total debt | 743.0 | 751.6 | |||||
Shareholders’ equity | 1,548.2 | 1,575.2 | |||||
Adjusted EBITDA (a) | 61.4 | 50.9 | |||||
Total capitalization (total debt plus equity) | 2,291.2 | 2,326.8 | |||||
Debt to capital ratio | 32 | % | 32 | % | |||
Net debt to enterprise value (b) | 15 | % | 14 | % |
(a) | Adjusted EBITDA is presented as the quarter-to-date amount (three months ended March 31, 2015 and December 31, 2014) for comparative purposes. For reconciliation of Adjusted EBITDA to net income see Performance and Liquidity Indicators. |
(b) | Enterprise value is calculated as the number of shares outstanding multiplied by the Company’s share price plus net debt as of March 31, 2015 and December 31, 2014. |
(millions of dollars) | 2015 | 2014 | |||||
Cash provided by (used for): | |||||||
Operating activities | $53.4 | $100.1 | |||||
Investing activities | (43.7 | ) | (2.6 | ) | |||
Financing activities | (30.6 | ) | (141.1 | ) |
Three Months Ended | |||||||||||
March 31, 2015 | December 31, 2014 | March 31, 2014 | |||||||||
Net Income to Adjusted EBITDA Reconciliation | |||||||||||
Net Income | $18.2 | $8.3 | $41.3 | ||||||||
Interest, net, continuing operations | 10.0 | 10.5 | 11.7 | ||||||||
Income tax benefit, continuing operations | (0.5 | ) | (4.3 | ) | (7.6 | ) | |||||
Depreciation, depletion and amortization | 30.0 | 29.7 | 26.0 | ||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | 3.7 | 4.6 | 3.1 | ||||||||
Discontinued operations (a) | — | (0.3 | ) | (31.0 | ) | ||||||
Internal review and restatement costs | — | 2.4 | — | ||||||||
Adjusted EBITDA | $61.4 | $50.9 | $43.5 |
Three Months Ended | Southern Timber | Pacific Northwest Timber | New Zealand Timber | Real Estate | Trading | Corporate and other | Total | ||||||||||||||||||||
March 31, 2015 | |||||||||||||||||||||||||||
Operating income | $12.4 | $2.6 | $5.7 | $12.6 | $0.3 | ($5.9 | ) | $27.7 | |||||||||||||||||||
Depreciation, depletion and amortization | 14.3 | 3.8 | 8.0 | 3.8 | — | 0.1 | 30.0 | ||||||||||||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | — | — | — | 3.7 | — | — | 3.7 | ||||||||||||||||||||
Adjusted EBITDA | $26.7 | $6.4 | $13.7 | $20.1 | $0.3 | ($5.8 | ) | $61.4 | |||||||||||||||||||
March 31, 2014 | |||||||||||||||||||||||||||
Operating income | $10.5 | $12.6 | $2.4 | $0.7 | ($0.4 | ) | ($11.4 | ) | $14.4 | ||||||||||||||||||
Depreciation, depletion and amortization | 12.0 | 6.3 | 6.5 | 0.9 | — | 0.3 | 26.0 | ||||||||||||||||||||
Non-cash cost of land sold and real estate development costs recovered upon sale | — | — | 2.1 | 1.0 | — | — | 3.1 | ||||||||||||||||||||
Adjusted EBITDA | $22.5 | $18.9 | $11.0 | $2.6 | ($0.4 | ) | ($11.1 | ) | $43.5 |
Three Months Ended March 31, | |||||||
2015 | 2014 | ||||||
Cash provided by operating activities | $53.4 | $100.1 | |||||
Capital expenditures from continuing operations (a) | (13.3 | ) | (16.9 | ) | |||
Real estate development costs | (0.3 | ) | (1.8 | ) | |||
Cash flow from discontinued operations | — | (56.0 | ) | ||||
Working capital and other balance sheet changes | 2.9 | (14.6 | ) | ||||
CAD | 42.7 | 10.8 | |||||
Mandatory debt repayments | — | — | |||||
Adjusted CAD | $42.7 | $10.8 |
Cash used for investing activities | ($43.7 | ) | ($2.6 | ) | |||
Cash used for financing activities | ($30.6 | ) | ($141.1 | ) |
(a) | Capital expenditures exclude timberland acquisitions of $23.1 million and $10.6 million during the three months ended March 31, 2015 and March 31, 2014, respectively. |
Item 3. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK |
Item 4. | CONTROLS AND PROCEDURES |
Item 1. | Legal Proceedings |
Item 2. | Unregistered Sales of Equity Securities and Use of Proceeds |
Period | Total Number of Shares Purchased (a) | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs | Maximum Number of Shares that May Yet Be Purchased Under the Plans or Programs | |||||||||
January 1 to January 31 | — | — | — | 3,836,655 | |||||||||
February 1 to February 28 | 2,984 | $29.69 | — | 3,836,655 | |||||||||
March 1 to March 31 | — | — | — | 3,836,655 | |||||||||
Total | 2,984 | — | 3,836,655 |
(a) | Repurchased to satisfy the minimum tax withholding requirements related to the vesting of restricted shares under the Rayonier Incentive Stock Plan. |
Item 6. | Exhibits |
10.1 | Rayonier Inc. Executive Severance Pay Plan, as amended* | Filed herewith | |
10.2 | Rayonier Incentive Stock Plan, as amended* | Filed herewith | |
10.3 | 2015 Performance Share Award Program* | Filed herewith | |
10.4 | Rayonier Annual Bonus Program, as amended* | Filed herewith | |
10.5 | Form of Rayonier Incentive Stock Plan Restricted Stock Award Agreement* | Filed herewith | |
31.1 | Chief Executive Officer’s Certification Pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed herewith | |
31.2 | Chief Financial Officer’s Certification Pursuant to Rule 13a-14(a)/15d-14(a) and pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 | Filed herewith | |
32 | Certification of Periodic Financial Reports Under Section 906 of the Sarbanes-Oxley Act of 2002 | Furnished herewith | |
101 | The following financial information from our Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2015, formatted in Extensible Business Reporting Language (“XBRL”), includes: (i) the Consolidated Statements of Income and Comprehensive Income for the Three Months Ended March 31, 2015 and 2014; (ii) the Consolidated Balance Sheets as of March 31, 2015 and December 31, 2014; (iii) the Consolidated Statements of Cash Flows for the Three Months Ended March 31, 2015 and 2014; and (iv) the Notes to Consolidated Financial Statements | Filed herewith |
RAYONIER INC. | ||
(Registrant) | ||
By: | /s/ H. EDWIN KIKER | |
H. Edwin Kiker Chief Accounting Officer (Duly Authorized Officer, Principal Accounting Officer) |
90586109.9 |
A. | Qualifying Termination. If, within two years following a Change in Control, (a) an Executive terminates his or her full time employment for Good Reason, or (b) the Company terminates an Executive's full time employment, the Executive shall be provided Scheduled Severance Pay and Additional Severance (collectively, “Separation Benefits”) in accordance with the terms of this Plan, except that Separation Benefits shall not be payable where Executive: |
1 |
• | is terminated for Cause; |
• | voluntarily resigns (including normal retirement), other than for Good Reason; |
• | voluntarily fails to return from an approved leave of absence (including a medical leave of absence); or |
• | terminates employment as a result of Executive's death or Disability. |
B. | Definitions Related to Qualifying Termination. For purposes of this Section 3, the following terms have the indicated definitions: |
2 |
A. | An Executive’s “Scheduled Severance Pay” is the product of the Executive’s Base Pay times the Executive’s Applicable Tier Multiplier. |
B. | An Executive’s “Additional Severance” is the sum of the Executive’s Benefits Continuation Amount, calculated as provided in Section 4C below, and the Executive’s Bonus Severance, calculated as provided in this Section 4B. |
(i) | An Executive’s “Bonus Severance” is the product of the Executive’s Applicable Bonus times the Executive’s Applicable Tier Multiplier, together with an additional amount equal to the Executive’s Current Pro-rata Bonus. |
(1) | An Executive’s “Applicable Bonus” is the greatest of (A) the highest bonus amount actually paid to the Executive under the Rayonier annual incentive |
3 |
(2) | An Executive’s “Current Pro-rata Bonus” is equal to the product of the Executive’s Applicable Bonus times a fraction the numerator of which is the number of months or portion thereof lapsed in the then current year prior to the Qualifying Termination and the denominator of which is twelve. |
C. | Benefits Continuation Amounts. The Executive’s Benefits Continuation Amount is the sum of the Executive’s Retirement Savings Adjustment and Other Benefits Adjustment. The Executive’s Retirement Savings Adjustment shall be in addition to amounts to which Executive is entitled under the Retirement Plan for Salaried Employees of Rayonier Inc., the Retirement Plan for Salaried Employees of ITT Corporation, the Rayonier Investment and Savings Plan for Salaried Employees and the Supplemental Plans (collectively, the "Retirement Plans"), in effect on the Effective Date of the Qualifying Termination. (Capitalized terms in this Section 4C that are not otherwise defined here or elsewhere in this Plan shall have the meaning ascribed to them in the applicable Retirement Plans.) |
(i) | An Executive’s “Retirement Savings Adjustment” is an amount equal to the excess of (X) over (Y), where (X) is the “Equivalent Actuarial Value” of the benefit to which Executive would have been entitled under the terms of the Retirement Plans, without regard to "vesting" thereunder, had Executive accumulated an additional 3 years of eligibility service as a fully vested participant in the Retirement Plans and an additional 3 years of benefit service in all the Retirement Plans other than the Retirement Plan for Salaried Employees of ITT Corporation and the ITT Supplemental Plans and as if Executive were 3 years older, solely for purposes of benefit eligibility and determining the amount of reduction in benefit on account of payment commencing prior to the Executive's normal retirement date, and by defining Executive's “Final Average Compensation” as equal to the greater of Executive's Base Pay on the Effective Date of Executive's Qualifying Termination or Executive's Final Average Compensation as determined under the terms of the Retirement Plan for Salaried Employees of Rayonier Inc., and (Y) is the Equivalent Actuarial Value of the amounts otherwise actually payable to Executive under the Retirement Plans. The Equivalent Actuarial Value shall be determined using the same assumptions utilized under the Rayonier Inc. Excess Benefit Plan upon the date of payment of the Benefits Continuation Amount and based on Executive's age on such date. |
4 |
(ii) | Other Benefits Adjustment. The “Other Benefits Adjustment” is an amount equal to the sum of the Medical Benefits Payment and the Outplacement Services, determined as provided in subsections (1) - (3) below. |
(1) | An Executive’s “Medical Benefits Payment” is the product of the employer contribution component of the health and welfare plans maintained for the Executive as of the Change in Control under the applicable employee welfare benefit plan (within the meaning of Section 3(1) of ERISA) maintained by the Company for the benefit of the Company's employees at such date, times the Executive’s Applicable Tier Multiplier, discounted for present value applying a 4% discount rate. |
(2) | “Outplacement Services” means the cost of outplacement services, the scope and provider of which shall be selected by Executive in his or her sole discretion, for a period not to extend beyond twelve (12) months after the Effective Date of Executive's Qualifying Termination, in an amount not to exceed $30,000 in the aggregate. |
D. | Equity Benefits. Company shall provide to Executive the following additional benefits upon a Qualifying Termination of the Executive, to the extent not actually provided under an Applicable Incentive Stock Plan of the Company (collectively, the “Equity Benefits”). Terms used in this Section 4D not otherwise defined in this Plan shall have the meaning assigned in the Applicable Incentive Stock Plan. |
(i) | Options. The Company shall cause (a) all of the options to purchase the Common Shares of the Company ("Stock Options") granted to Executive prior to the Qualifying Termination by the Company to become immediately exercisable in full in accordance with the terms of the Applicable Incentive Stock Plan pursuant to which they were issued (provided that no Stock Option shall be exercisable after the termination date of such Stock Option). |
5 |
(ii) | Restricted Stock. The Company shall (a) cause Executive to immediately vest in all outstanding shares of Restricted Stock that were the subject of an Award under an Incentive Stock Plan of the Company which Restricted Stock is held by or for the benefit of the Executive immediately prior to the Qualifying Termination without any remaining restrictions other than those imposed by applicable securities laws, (b) issue stock certificates in respect thereof to Executive without a restrictive legend and (c) permit Executive to tender within 60 days of the Qualifying Termination all such Restricted Stock to the Company and in the event of such a tender forthwith pay to the Executive the Fair Market Value therefore. |
(iii) | Performance Share Awards. In the event of a Qualifying Termination, Awards of “Performance Shares” under all “Performance Share Award Programs” shall be settled as follows: (a) with respect to any Award for which the applicable Performance Period is more than 50% completed, the Performance Period shall be deemed to end as of the Qualifying Termination and the Executive shall receive the greater of (1) the Award resulting from utilizing the Fair Market Value in calculating total shareholder return for the Company for purposes of measuring Company performance with that of the comparison group under the applicable program, and (2) the Award at 100% of target performance under the applicable program; and (b) with respect to any Award as to which the applicable Performance Period is not more than 50% completed, the Executive shall receive the Award at 100% of target performance under the applicable program. Performance Shares due hereunder shall be settled in cash and paid on the basis of the Fair Market Value. |
(iv) | Coordination with Incentive Stock Plans. Any amounts paid hereunder shall be an offset against amounts otherwise due from the Company under the Applicable Incentive Stock Plan in respect of the same Award covered herein. |
(v) | Coordination with Section 409A. If at any time the payment of an Equity Benefit would be deemed to be payable to an Executive as a result of the Executive’s Separation from Service, payment of such Equity Benefit shall not be made earlier than the end of the Separation Delay Period where on the date of the Separation from Service the Executive was a Specified Employee; provided that, such delay in payment shall not apply to any portion of the Equity Benefit that is excepted from such delay under the Code Section 409A Rules as a Short-Term Deferral, Separation Pay or otherwise |
6 |
A. | In the event any dispute arises between Executive and the Company as to the validity, enforceability and/or interpretation of any right or benefit afforded by this Plan, at Executive's option such dispute shall be resolved by binding arbitration proceedings in accordance with the rules of the American Arbitration Association. The arbitrators shall presume that the rights and/or benefits afforded by this Plan which are in dispute are valid and enforceable and that Executive is entitled to such rights and/or benefits. The Company shall be precluded from asserting that such rights and/or benefits are not valid, binding and enforceable and shall stipulate before such arbitrators that the Company is bound by all the provisions of this Plan. The burden of overcoming by clear and convincing evidence the presumption that Executive is entitled to such rights and/or benefits shall be on the Company. The results of any arbitration shall be conclusive on both parties and shall not be subject to judicial interference or review on any ground whatsoever, including without limitation any claim that the Company was wrongfully induced to enter into this agreement to arbitrate such a dispute. |
B. | In the event Executive is required to defend in any legal action or other proceeding the validity or enforceability of any right or benefit afforded by this Plan, the Company will pay any and all actual legal fees and expenses incurred by such Executive regardless of the outcome of such action and, if requested by Executive, shall (within two business days of such request) advance such expenses to Executive. The Company shall be precluded from asserting in any judicial or other proceeding commenced with respect to any right or benefit afforded by this Plan that such rights and benefits are not valid, binding and enforceable and shall stipulate in any such proceeding that the Company is bound by all the provisions of this Plan. |
C. | Amounts payable by the Company under this Section 5 shall in the first instance be paid by the trustee under the trust established by that certain Trust Agreement, known as the “Legal Resources Trust” authorized by the Compensation and Management Development Committee on July 20, 2001, to the extent such amounts were previously transferred by the Company to the trustee of the Legal Resources Trust. |
A. | As a condition to the receipt of a designated portion of the Equity Benefits and the other Plan Benefits otherwise payable hereunder (such portion, the “Covenant Amount”) and in consideration thereof, Executive shall be deemed to have made and be bound by the “Change |
7 |
B. | The Executive’s “Change in Control Covenants” are the Confidentiality Covenants set forth in this Section 6B. |
(vi) | Confidentiality Covenants. While employed by the Company following the Change in Control, and for a period of two (2) years following a Qualifying Termination (the “Confidential Information Period”), Executive covenants that Executive shall not disclose or make available to any person or entity any “Confidential Information” (as defined below) and shall not use or cause to be used any Confidential Information for any purpose other than fulfilling Executive’s employment obligations to the Company, without the express prior written authorization of the Company. For this purpose, “Confidential Information” means all information about the Company relating to any of its products or services or any phase of operations, including, without limitation, business plans and strategies, trade secrets, know-how, contracts, financial statements, pricing strategies, costs, customers and potential customers, vendors and potential vendors, marketing and distribution information, business results, software, hardware, databases, processes, procedures, technologies, designs, concepts, ideas, and methods not generally known through legitimate means to any of its competitors with which Executive became acquainted during the term of employment by the Company. Confidential Information also includes confidential information of third parties made available to the Company on a confidential basis, but does not include information which is generally known to the public without breach by Executive, (b) was given to Executive by a third party without any obligation of confidentiality, or (c) was obtained or independently developed by Executive prior to or following employment by the Company without the use of information that is otherwise Confidential Information. |
C. | Remedies Limited to Equitable Relief. By accepting payment of the Covenant Amount, Executive shall be deemed (a) to have acknowledged that in the event Executive breaches any of the Change in Control Covenants, the damages to the Company would be irreparable and that the Company shall have the right to seek injunctive and/or other equitable relief in |
8 |
A. | Notwithstanding any provision of this Plan to the contrary, in the event that the payments and other benefits payable under this Plan or otherwise payable to an Executive under any other plan, program, arrangement or agreement maintained by the Company or one of its affiliates (i) would constitute an “excess parachute payment” (as defined under Code Section 280G) and (ii) would be subject to the excise tax imposed by Section 4999 of the Code, then such payments and other benefits shall be payable either (x) in full or (y) in a reduced amount that would result in no portion of such payments and other benefits being subject to the excise tax imposed under Section 4999 of the Code, whichever of the foregoing amounts, taking into account the applicable federal, state, and local income taxes and the excise tax imposed by Section 4999 of the Code, results in the receipt by such Executive on an after-tax basis, of the greatest amount of severance benefits under this Plan or otherwise, notwithstanding that all or some portion of such severance benefits may be taxable under Section 4999 of the Code. |
B. | The determination of whether it is necessary to decrease a payment or benefit to be paid under this Plan must be made in good faith by a nationally recognized certified public accounting firm (the “Accounting Firm”) selected by the Company. This determination will be conclusive and binding upon the Executive and the Company. In the event that the Accounting Firm is serving as accountant or auditor for the individual, entity, or group effecting the Change in Control, the Company shall appoint another nationally recognized certified public accounting firm to make the determination required under this Plan. The Company shall bear all fees of the Accounting Firm. If a reduction is necessary, the Executive will have the right to designate the particular payment or benefit to be reduced or eliminated so that no portion of the payment or benefit to be paid to the Executive will be an excess parachute payment subject to the deduction limits under Section 280G of the Code and the excise tax under Section 4999 of the Code. However, no payment of “deferred compensation” (as defined under Treasury Regulation Section 1.409A-1(b)(1), after giving effect to the exemptions in Treasury Regulation Sections 1.409A-1(b)(3) through (b)(12)) may be reduced to the extent that a reduction can be made to any payment or benefit that is not “deferred compensation.” |
9 |
10 |
11 |
12 |
13 |
14 |
15 |
1. | Purpose |
2. | Definitions |
3. | Shares Subject to the Plan |
5. | Stock Options and Rights |
6. | Performance Shares |
7. | Restricted Stock |
8. | Certificates for Awards of Stock |
9. | Change in Control |
(i) | subject to the conditions contained in the final paragraph of this definition, the filing of a report on Schedule 13D with the Securities and Exchange Commission pursuant to Section 13(d) of the Act disclosing that any person, other than the Company or any employee benefit plan sponsored by the Company, is the beneficial owner (as the term is defined in Rule 13d-3 under the Act) directly or indirectly, of securities representing 50 percent or more of the total voting power represented by the Company’s then outstanding Voting Securities (calculated as provided in paragraph (d) of Rule 13d-3 under the Act in the case of rights to acquire Voting Securities); or |
(ii) | the purchase by any person, other than the Company or any employee benefit plan sponsored by the Company, of shares pursuant to a tender offer or exchange offer to |
(iii) | the approval by the shareholders of the Company, and the subsequent occurrence, of (A) any consolidation or merger of the Company in which the Company is not the continuing or surviving corporation (other than a merger of the Company in which holders of Common Shares of the Company immediately prior to the merger have the same proportionate ownership of Common Shares of the surviving corporation immediately after the merger as immediately before), or pursuant to which Common Shares of the Company would be converted into cash, securities, or other property, or (B) any sale, lease, exchange, or other transfer (in one transaction or a series of related transactions) of all or substantially all the assets of the Company; or |
(iv) | a change in the composition of the Board of the Company at any time during any consecutive 24-month period such that “continuing directors” cease for any reason to constitute at least a 70 percent majority of the Board. |
10. | Beneficiary |
12. | Amendment, Extension or Termination |
13. | Adjustments in Event of Change in Common Stock and Change in Control |
14. | Forfeiture of Gains on Exercise |
15. | Conditions Subsequent |
16. | Clawback Policy |
17. | Miscellaneous |
18. | Effective Date, Term of Plan and Shareholder Approval |
• | TSR is defined as stock price appreciation plus the reinvestment of dividends on a quarterly basis. For purposes of performance measurement, TSR shall be the final reported figure as may be adjusted by the Committee for unusual items to avoid distortion in the operation of the Program. |
• | TSR over the performance period will be calculated by measuring the value of a hypothetical $100 investment in Rayonier shares as compared to an equal investment in each of the peer group companies. |
• | TSR calculations of stock price appreciation will be the average of the closing prices of Rayonier common shares and that of each of the peer group companies for the first 20 trading dates and last 20 trading dates of the Performance Period. |
• | The TSR performance of Rayonier and the peer group companies will be calculated and Rayonier’s relative performance, on a percentile basis, is determined. |
• | The payout percentage of Target Award based on Rayonier’s percentile TSR performance against the peer group companies will be calculated per the following table: |
Percentile Rank | Award (Expressed As Percent of Target Award) |
80th and Above | 200% |
51st –79th | 100%, plus 3.33% for each incremental percentile position over the 50th percentile |
50th | 100% |
31st – 49th | 30%, plus 3.5% for each incremental percentile position over the 30th percentile |
30th | 30% |
Below 30th | 0% |
• | The payout percentage may not exceed 100% of target awards if Rayonier’s TSR for the Performance Period is negative. |
• | Payment, if any, is to be made in Rayonier Common Shares, and may be offset, to the extent allowed under applicable regulations, by the number of shares equal in value to the amount needed to cover associated tax liabilities. |
• | Dividend equivalents and interest will be paid in cash on the number of Rayonier Common Shares earned under the Program. |
• | Dividends equivalents and interest will be calculated by taking the dividends paid on one share of Rayonier Common Stock during the performance period times the number of shares awarded at the end of the period. Interest on such dividends will be earned at a rate equal to the prime rate as reported in the Wall Street Journal, adjusted and compounded annually, from the date such cash dividends were paid by the Company. |
• | Awards will be valued as soon as practicable following the end of the performance period. Awards, including dividends and interest, will be distributed to participants as soon as practicable following the valuation date. |
• | Target awards will be prorated in cases of retirement, death, or disability in accordance with Plan provisions. |
• | Notwithstanding any other provision in this Plan to the contrary, any award or shares issued thereunder and any amount received with respect to the sale of any such Award or shares, shall be subject to potential cancellation, recoupment, rescission, payback, or other action in accordance with the terms of the Company’s Clawback Policy as in effect from time to time (the “Clawback Policy”). |
• | Catchmark Timber Trust |
• | Deltic Timber |
• | Potlatch Corporation |
• | Plum Creek |
• | Pope Resources |
• | Weyerhaeuser |
• | Alexander & Baldwin, Inc. |
• | American Campus Communities, Inc. |
• | Apartment Investment and Management Company |
• | Avalonbay Communities Inc. |
• | AV Homes, Inc. |
• | Camden Property Trust |
• | Equity Residential |
• | Equity LifeStyle Properties, Inc. |
• | Essex Property Trust Inc. |
• | Forest City Enterprises Inc. |
• | Forestar Group Inc. |
• | HCP, Inc. |
• | Home Properties Inc. |
• | The Howard Hughes Corporation |
• | Mid-America Apartment Communities Inc. |
• | Omega Healthcare Investors Inc. |
• | Post Properties Inc. |
• | Senior Housing Properties Trust |
• | The St. Joe Company |
• | Sun Communities Inc. |
• | UDR, Inc. |
(a) | “Available Bonus Pool” means with respect to any Performance Period, the sum of the Preliminary Bonus Awards for all Designated Employees excluding Covered Executives, as adjusted by any change made by the Committee pursuant to Section 4(d)(i); provided that, such sum shall not exceed the amount specified in Section 4(a). |
(a) | “Bonus Award” means the bonus payable in respect of a specified Performance Period to a Designated Employee determined in accordance with Section 4. |
(b) | “Bonus Program” means this Rayonier Annual Bonus Program, as it may be modified from time to time by the Committee. |
(c) | “Clawback Policy” has the meaning set forth in Section 8(j). |
(d) | “Code” means the Internal Revenue Code of 1986, as it may be amended from time to time, and the applicable regulations thereunder. |
(e) | “Rayonier Performance Factor” or “RPF” has the meaning set forth in Section 5. |
(f) | “Covered Executive” has the same meaning as set forth in the Plan. |
(g) | “Designated Employees” means with respect to any applicable Performance Period, the Covered Executives and other U.S. based employees identified by Salary Grades L1 to L11, or otherwise, as designated by the Committee prior to the end of the first quarter of the Performance Period. |
(h) | “Exchange Act” means the Securities Exchange Act of 1934, as amended. |
(i) | “Performance Period” means the Company’s fiscal year or any other period designated by the Committee with respect to which Bonus Awards are granted. |
(j) | “Performance Bonus Award” is the Bonus Award determined in accordance with this Bonus Program and the Plan. |
(k) | “Plan” means the Rayonier Non-Equity Incentive Plan, pursuant to which this Bonus Program is adopted, or any successor thereto. |
(l) | “Preliminary Bonus Award” means: |
(i) | for Designated Employees other than Covered Executives, the product of multiplying (a) the employee’s Target Award times (b) the Rayonier Performance Factor calculated in accordance with Exhibit A; and |
(ii) | for Covered Executives, an amount equal to 150% of the executive’s Target Award unless the Rayonier Performance Factor is 0%, in which case the Preliminary Bonus Award will be zero. |
(m) | “Target Award” means with respect to a Designated Employee, the amount expressed as a percent of the Designated Employee’s Performance Period base pay earnings. |
(a) | Maximum Bonus Pool for a Performance Period. The aggregate amount payable as Bonus Awards for any Performance Period for all Designated Employees shall not exceed 150% of the sum of the Target Awards for all Executives. |
(b) | Setting Performance Goals, Performance Objectives and Target Awards. Within ninety (90) days of the start date of each Performance Period (or by such earlier time as may be required in the future by the applicable provisions of the Code in the case of Covered Executives), the Committee shall: |
(i) | Determine the Designated Employees by class or otherwise who will participate in the Bonus Program for the particular Performance Period; |
(ii) | Determine the parameters of the Rayonier Performance Factor to be applied for the Performance Period in accordance with Section 5(a) and substantially in the form set forth on Exhibit A; |
(iii) | Establish the Target Award for the Performance Period for the Designated Employees covered by the Bonus Program by class or otherwise, including for each Covered Executive, by reference to a percent of base salary by Salary Grade at the end of the performance period as set forth on Exhibit B; and |
(c) | Calculation of Performance Bonus Awards. In the case of Designated Employees who are not Covered Executives, individual Performance Bonus Awards are determined based upon the Designated Employee’s Preliminary Bonus Award, adjusted up to +30/-100% based upon the Designated Employee’s performance against identified individual objectives established for each Designated Employee; provided that, the sum of all Performance Bonus Awards for Designated Employees who are not Covered Executives cannot exceed the Available Bonus Pool. Notwithstanding any adjustments recommended in respect of a Designated Employee’s performance against identified individual objectives, the Committee may increase or reduce the final Performance Bonus Award of any Designated Employee who is not a Covered Executive where it deems appropriate, in its sole discretion, subject to the aggregate limitation in Section 4(a) for all Bonus Awards. Covered Executive Performance Bonus Awards are calculated pursuant to (d)(ii) of this Section 4. |
(d) | Certification of RPF and Finalization of Bonus Awards. At the end of each Performance Period, the Committee shall: |
(i) | Review the calculation of the Available Bonus Pool and the Preliminary Bonus Award payout levels for all Designated Employees covered by the Bonus Program, and if the Committee deems necessary or appropriate, exercise its discretion to increase or decrease the Available Bonus Pool based on such factors as it may deem relevant. Preliminary Bonus Awards of Designated Employees that comprise the Available Bonus Pool will be adjusted proportionately in the event of such a discretionary adjustment. The Committee shall make such adjustments as provided for in Section 4 (c) to individual Performance Bonus Awards to Designated Employees who are not Covered Executives as the Committee deems appropriate in its discretion; |
(ii) | With respect to each Covered Executive, determine the reductions if any to the Covered Executives’ Preliminary Bonus Awards based upon the Committee’s review of each Covered Executive’s performance in terms of the RPF and performance against identified individual objectives established for each Covered Executive, with such determination in the sole negative discretion of the Committee; |
(iii) | Establish the form of payment and the payment date for Bonus Awards for the Performance Period for Covered Executives as provided in Section 6; and |
(iv) | Prior to the payment of a Bonus Award to any Covered Executive, certify by Committee resolution or otherwise in writing, in accordance with the requirements of Section 162(m) of the Code and Section 5(e)(B) of the Plan, whether the material terms for paying such Bonus Award in respect of the Performance Period have been achieved or met. |
(a) | Criteria for Establishing the RPF. The “Rayonier Performance Factor” shall consist of those Performance Goals permitted under the Plan that are selected by the Committee for the specified Performance Period, and weighted as designated by the Committee for such Performance Period so as to reflect Performance Objectives under the Plan. Such selection and weighting in determining the Rayonier Performance Factor may be changed from time to time by the Committee consistent with the provisions of the Plan in respect of Covered Executives, provided that with respect to a particular Performance Period, the Rayonier Performance Factor shall be established generally prior to the commencement of such Performance Period and in all events not later than the end of the first quarter of any Performance Period. |
(b) | Initial RPF Performance Goals and Parameters. The Rayonier Performance Factor shall be computed as specified in Exhibit A hereto until changed by the Committee as provided in Section 5(a), with such adjustments to reported earnings for accounting rule changes, special non-recurring items, discontinued operations, and similar adjustments as are approved by the Committee made so as to provide consistent measurements of continuing performance. |
(a) | Entitlement to Payments Generally. Subject to Sections 4(d)(iii) and (iv) for Covered Executives, Bonus Awards for a Performance Period shall be paid at such time as designated by the Committee following the closing of the Performance Period and its determination of the final Bonus Awards as provided in Section 4(d), to Designated Employees who are employed by the Company on the payment date or whose employment terminated as a result of death, disability or normal retirement following the end of the applicable Performance Period. The Chief Executive Officer shall determine if a pro-rated Bonus Award shall be paid to any Designated Employee, other than a Covered Executive, whose employment terminated as a result of death, disability or normal retirement during the applicable Performance Period. Except as provided in the previous sentence, the Committee shall determine in its sole discretion if a Bonus Award shall be paid to any Designated Employee who is not employed by the Company on the payment date. |
(b) | Employment After Commencing of a Performance Period. Subject to such modifications as may be approved by the Committee, Designated Employees who commence employment after the start of a Performance Period may be granted a Bonus Award determined pro-rata for the term of such employee’s employment during the Performance Period. To the extent a new Designated Employee may become entitled to a Bonus Award hereunder, a Target Award shall be computed for such Designated Employee to reflect such pro-rata participation and the Available Bonus Pool shall be adjusted to reflect such Target Award. |
(c) | Form of Payment. Bonus Awards shall be paid in cash, except that Bonus Awards for Covered Executives may be paid in cash, stock, other stock-based or stock-denominated units or any combination thereof as determined by the Committee to the extent permitted by the Plan at the time, and subject to compliance with any applicable listing requirements and securities laws. |
(d) | Timing of Payments. Before payment of any Bonus Award is made to a Covered Executive under this Bonus Program, the Committee shall have complied with the provisions of Section 4(d)(iv). It is anticipated that for Designated Employees other than Covered Executives, if authorized by the Committee, payments of Bonus Awards can be based on preliminary data available in the last month of the Performance Period and made shortly after the end of the Performance Period, subject to confirmation following the close of the Performance Period by report to the Committee at its next regularly scheduled meeting following such payments indicating that payment was made in compliance with the terms of the Bonus Program. The time of payment shall be as determined by the Committee, though in all events payment shall be made prior to the end the applicable short-term deferral period under Section 409A of the Code. |
(a) | No Designated Employee shall have any claim or right to be granted a Bonus Award under the Bonus Program until such Bonus Award is actually made. Neither the existence of this Bonus Program, nor any action taken hereunder, shall be construed as giving any Designated Employee any right to be retained in the employ of the Company or in any way interfere with or limit the right of the Company to terminate any Designated Employee’s employment |
(b) | No employee shall, at any time, have a right to become a Designated Employee in the Bonus Program for any Performance Period, for any reason, including notwithstanding the individual’s having previously participated in the Bonus Program. |
(c) | The Company shall have the right to deduct from a Bonus Award or from any other amounts due the Designated Employee from the Company, any taxes or other amounts required or permitted to be withheld by law. |
(d) | No Designated Employee or any other party claiming an interest in amounts earned under the Bonus Program shall have any interest whatsoever in any specific asset of the Company. To the extent that any person or entity acquires a right to receive payments under the Bonus Program, such rights shall be that of an unsecured general creditor of the Company. |
(e) | All questions pertaining to the construction, regulation, validity and effect of the provisions of the Bonus Program shall be determined in the sole discretion of the Committee pursuant to the Plan. |
(f) | With the exception of payments made following the death of a Designated Employee, the rights and benefits of a Designated Employee hereunder are personal to the Designated Employee and shall not be subject to any voluntary or involuntary alienation, assignment, pledge, transfer, encumbrance, attachment, garnishment or other disposition. |
(g) | Bonus Awards under this Bonus Program shall not constitute compensation for the purpose of determining participation or benefits under any other plan of the Company unless specifically included as compensation in such plan. |
(h) | If any provision of this Bonus Program would cause a Performance Bonus Award not to constitute “qualified performance-based compensation” under Section 162(m) with respect to a Covered Executive, that provision shall be severed from, and shall be deemed not to be a part of, the Bonus Program, in respect of such Covered Executive but the other provisions hereof shall remain in full force and effect. |
(i) | In the event that changes are made to Section 162(m) to permit greater flexibility under the Bonus Program, the Committee may make any adjustments it deems appropriate. |
(j) | Notwithstanding any other provision in this Plan to the contrary, any Bonus Award issued thereunder and any amount received with respect of any Bonus Award, shall be subject to potential cancellation, recoupment, rescission, payback, or other action in accordance with the terms of the Company’s Clawback Policy as in effect from time to time (the “Clawback Policy”. |
2015 Performance Goals | Payout Range |
Recurring Cash Flow (“RCF”) divided by Budget RCF | 0% - 120% |
Strategic / Quality of Earnings Multiplier (as reviewed and approved by the Committee) | +/-30% |
▪ | Determine the RCF payout using the table below, interpolating values between the threshold, target and maximum levels. |
▪ | Once the Committee has determined the strategic/quality of earnings payout multiplier ranging from -30% to +30%, add the strategic payout multiplier percentage results to the financial payout percentage results to determine the RPF. With the strategic/quality of earnings multiplier the payout can range from 0-150%. |
KEY EMPLOYEE ___________________________________ Name: «First_Name» «Last_Name» Address: «Address_Line_1» «Address_Line_2» «City», «State» «Zip_Code» | RAYONIER INC. By____________________________ Shelby L. Pyatt Vice President, Human Resources |
1. | I have reviewed this quarterly report on Form 10-Q of Rayonier Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/S/ DAVID L NUNES | |
David L. Nunes President and Chief Executive Officer, Rayonier Inc. |
1. | I have reviewed this quarterly report on Form 10-Q of Rayonier Inc.; |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report; |
4. | The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rule 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rule 13a-15(f) and 15d-15(f)) for the registrant and have: |
a. | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; |
b. | Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; |
c. | Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and |
d. | Disclosed in this report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and |
5. | The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions): |
a. | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and |
b. | Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal control over financial reporting. |
/s/ MARK MCHUGH | |
Mark McHugh Senior Vice President and Chief Financial Officer, Rayonier Inc. |
1. | The quarterly report on Form 10-Q of Rayonier Inc. (the "Company") for the period ended March 31, 2015 (the "Report") fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and |
2. | The information in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company. |
/s/ DAVID L. NUNES | /s/ MARK MCHUGH | |
David L. Nunes | Mark McHugh | |
President and Chief Executive Officer, Rayonier Inc. | Senior Vice President and Chief Financial Officer, Rayonier Inc. |
CONSOLIDATING FINANCIAL STATEMENTS (Tables)
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Mar. 31, 2015
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Senior Exchangeable Notes due August 2015 at a fixed interest rate of 4.50% [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Statements, Captions [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Condensed Consolidating Statement of Income and Comprehensive Income |
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Schedule of Condensed Consolidating Balance Sheets |
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Schedule of Condensed Consolidating Statements of Cash Flows |
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Senior Notes due 2022 at a fixed interest rate of 3.75% [Member] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Condensed Financial Statements, Captions [Line Items] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Condensed Consolidating Statement of Income and Comprehensive Income |
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Schedule of Condensed Consolidating Balance Sheets |
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Schedule of Condensed Consolidating Statements of Cash Flows |
|
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