-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, A88NoOLM7YxIa9RyUvU+1DkRQgMzahDtCPVpZv05qHT+WIN31PcEtyavp9eG7mCs wgBqYl7TuN3q7ohFiExLAQ== 0000950123-96-004388.txt : 19960814 0000950123-96-004388.hdr.sgml : 19960814 ACCESSION NUMBER: 0000950123-96-004388 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 7 CONFORMED PERIOD OF REPORT: 19960630 FILED AS OF DATE: 19960813 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: RAYONIER INC CENTRAL INDEX KEY: 0000052827 STANDARD INDUSTRIAL CLASSIFICATION: LUMBER & WOOD PRODUCTS (NO FURNITURE) [2400] IRS NUMBER: 132607329 STATE OF INCORPORATION: NC FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 001-06780 FILM NUMBER: 96611225 BUSINESS ADDRESS: STREET 1: 1177 SUMMER ST CITY: STAMFORD STATE: CT ZIP: 06904 BUSINESS PHONE: 2033487000 MAIL ADDRESS: STREET 1: 1177 SUMMER STREET CITY: STAMFORD STATE: CT ZIP: 06905-5529 FORMER COMPANY: FORMER CONFORMED NAME: ITT RAYONIER INC /CT/ DATE OF NAME CHANGE: 19940422 FORMER COMPANY: FORMER CONFORMED NAME: ITT RAYONIER INC DATE OF NAME CHANGE: 19920703 10-Q 1 RAYONIER INC. 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (Mark One) (x) QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1996 OR ( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM ........... TO ............ COMMISSION FILE NUMBER 1-6780 RAYONIER INC. Incorporated in the State of North Carolina I.R.S. Employer Identification Number l3-2607329 l177 Summer Street, Stamford, Connecticut 06905-5529 (Principal Executive Office) Telephone Number: (203) 348-7000 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section l3 or l5(d) of the Securities Exchange Act of l934 during the preceding l2 months and (2) has been subject to such filing requirements for the past 90 days. YES (X) NO ( ) As of August 6, 1996, there were 29,469,322 Common Shares of the Registrant outstanding. __________ 2 RAYONIER INC. TABLE OF CONTENTS PAGE ---- PART I. FINANCIAL INFORMATION Item 1. Financial Statements Statements of Consolidated Income for the Three Months and Six Months Ended June 30, 1996 and 1995 1 Consolidated Balance Sheets as of June 30, 1996 and December 3l, 1995 2 Statements of Consolidated Cash Flows for the Six Months Ended June 30, 1996 and 1995 3 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 4-6 Item 3. Selected Operating Data 7 PART II. OTHER INFORMATION Item 4. Submission of Matters to a Vote of Security Holders 8 Item 5. Other Information 8 Item 6. Exhibits and Reports on Form 8-K 8 Signature 8 Exhibit Index 9-10 i 3 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS The following unaudited financial statements reflect, in the opinion of Rayonier Inc. (Rayonier or the Company), all adjustments (which include only normal recurring adjustments) necessary for a fair presentation of the results of operations, the financial position and the cash flows for the periods presented. Certain reclassifications have been made to the prior year's financial statements to conform to current year presentation. For a full description of accounting policies, please refer to Notes to Consolidated Financial Statements in the 1995 Annual Report on Form 10-K. RAYONIER INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED INCOME (UNAUDITED) (THOUSANDS OF DOLLARS, EXCEPT PER SHARE DATA)
Three Months Six Months Ended June 30, Ended June 30, -------------- -------------- 1996 1995 1996 1995 ----------- ----------- ----------- ----------- SALES $ 296,667 $ 313,564 $ 590,647 $ 599,396 ----------- ----------- ----------- ----------- Costs and expenses Cost of sales 254,787 252,213 480,461 476,257 Selling and general expenses 9,398 9,426 18,241 17,813 Other operating income, net (467) (1,766) (896) (3,209) ----------- ----------- ----------- ----------- 263,718 259,873 497,806 490,861 ----------- ----------- ----------- ----------- OPERATING INCOME 32,949 53,691 92,841 108,535 Interest expense (7,097) (8,773) (14,243) (17,308) Interest and miscellaneous income, net 1,473 999 2,961 1,667 Minority interest (7,549) (7,272) (16,537) (16,572) ----------- ----------- ----------- ----------- Income before income taxes 19,776 38,645 65,022 76,322 Provision for income taxes (4,372) (12,307) (18,141) (24,835) ----------- ----------- ----------- ----------- NET INCOME $ 15,404 $ 26,338 $ 46,881 $ 51,487 =========== =========== =========== =========== NET INCOME PER COMMON SHARE $ 0.51 $ 0.88 $ 1.56 $ 1.72 =========== =========== =========== =========== Weighted average Common Shares outstanding 30,030,479 29,955,149 30,060,476 29,895,951 =========== =========== =========== ===========
1 4 RAYONIER INC. AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (THOUSANDS OF DOLLARS) ASSETS
June 30, December 31, 1996 1995 -------------- --------------- CURRENT ASSETS Cash and short-term investments $ 4,813 $ 10,932 Accounts receivable, less allowance for doubtful accounts of $4,394 and $4,420 138,039 128,478 Inventories Finished goods 63,047 71,307 Work in process 21,351 25,681 Raw materials 41,793 44,350 Manufacturing and maintenance supplies 30,780 28,740 ------------- -------------- Total inventories 156,971 170,078 Timber stumpage 31,198 49,464 Other current assets 22,703 15,412 Deferred income taxes 13,243 15,208 ------------- -------------- Total current assets 366,967 389,572 OTHER ASSETS 47,752 47,239 TIMBER STUMPAGE 34,940 29,396 TIMBER, TIMBERLANDS AND LOGGING ROADS, NET OF DEPLETION AND AMORTIZATION 483,244 476,463 PROPERTY, PLANT AND EQUIPMENT Land, buildings, machinery and equipment 1,358,027 1,292,059 Less - accumulated depreciation 617,492 586,796 ------------- -------------- 740,535 705,263 ------------- -------------- $ 1,673,438 $ 1,647,933 ============= ============== LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES Accounts payable $ 89,326 $ 102,938 Bank loans and current maturities 2,929 3,040 Accrued taxes 20,050 9,941 Accrued payroll and benefits 18,041 26,554 Accrued interest 5,166 5,268 Other current liabilities 36,370 39,943 Current reserves for dispositions 16,116 16,047 ------------- -------------- Total current liabilities 187,998 203,731 DEFERRED INCOME TAXES 163,245 160,574 LONG-TERM DEBT 461,972 446,696 NON-CURRENT RESERVES FOR DISPOSITIONS 19,292 23,542 OTHER NON-CURRENT LIABILITIES 26,519 25,204 MINORITY INTEREST 21,386 18,815 SHAREHOLDERS' EQUITY Common Shares, 60,000,000 shares authorized, 29,510,389 and 29,653,278 shares issued and outstanding 152,977 159,032 Retained earnings 640,049 610,339 ------------- -------------- 793,026 769,371 ------------- -------------- $ 1,673,438 $ 1,647,933 ============= ==============
2 5 RAYONIER INC. AND SUBSIDIARIES STATEMENTS OF CONSOLIDATED CASH FLOWS (UNAUDITED) (THOUSANDS OF DOLLARS)
Six Months Ended June 30, -------------- 1996 1995 ------------- -------------- OPERATING ACTIVITIES Net income $ 46,881 $ 51,487 Non-cash items included in income Depreciation, depletion and amortization 46,687 47,238 Deferred income taxes 4,024 7,912 Increase in other non-current liabilities 1,315 2,679 Change in accounts receivable, inventories and accounts payable (10,066) (60,371) Decrease in current timber stumpage 18,266 268 Increase in other current assets (7,291) (2,904) Decrease in accrued liabilities (2,079) (10,112) Change in reserves for dispositions (2,500) (2,533) ------------- -------------- Cash from operating activities 95,237 33,664 ------------- -------------- INVESTING ACTIVITIES Capital expenditures, net of sales and retirements of $671 and $713 (88,740) (68,332) Expenditures for dispositions, net of tax benefits of $612 and $2,165 (1,069) (3,654) Change in timber stumpage and other assets (6,057) (1,087) ------------- -------------- Cash used for investing activities (95,866) (73,073) ------------- -------------- FINANCING ACTIVITIES Issuance of debt 17,200 50,773 Repayments of debt (2,035) (201) Dividends (17,170) (14,808) (Repurchase) issuance of Common Shares (6,056) 858 Increase (decrease) in minority interest 2,571 (1,037) ------------- -------------- Cash (used for) provided by financing activities (5,490) 35,585 ------------- -------------- CASH AND SHORT-TERM INVESTMENTS Decrease during the period (6,119) (3,824) Balance, beginning of period 10,932 9,178 ------------- -------------- Balance, end of period $ 4,813 $ 5,354 ============= ============== Supplemental disclosures of cash flow information Cash paid during the period for: Interest $ 15,210 $ 16,755 ============= ============== Income taxes, net of refunds $ 6,900 $ 19,251 ============= ==============
3 6 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The sales and operating income of Rayonier's business segments for the three and six months ended June 30, 1996 and 1995 were as follows (thousands of dollars):
Three Months Six Months Ended June 30, Ended June 30, -------------- -------------- 1996 1995 1996 1995 ----------- ----------- ----------- ----------- SALES TIMBER AND WOOD PRODUCTS Log trading and merchandising $ 92,965 $ 121,301 $ 160,757 $ 201,302 Timberlands management and stumpage 41,192 37,508 90,941 87,661 Wood products 27,129 19,409 47,767 34,532 Intrasegment eliminations (3,158) (5,564) (8,287) (9,748) ----------- ----------- ----------- ----------- Total Timber and Wood Products 158,128 172,654 291,178 313,747 ----------- ----------- ----------- ----------- SPECIALTY PULP PRODUCTS Chemical cellulose 95,499 82,423 200,143 166,029 Fluff and specialty paper pulps 43,856 64,933 101,738 132,093 ----------- ----------- ----------- ----------- Total Specialty Pulp Products 139,355 147,356 301,881 298,122 ----------- ----------- ----------- ----------- Intersegment eliminations (816) (6,446) (2,412) (12,473) ----------- ----------- ----------- ----------- Total sales $ 296,667 $ 313,564 $ 590,647 $ 599,396 =========== =========== =========== =========== OPERATING INCOME Timber and Wood Products $ 32,466 $ 35,747 $ 69,649 $ 78,501 Specialty Pulp Products 4,035 20,374 29,175 35,647 Corporate and other (3,693) (3,330) (6,189) (5,501) Intersegment eliminations 141 900 206 (112) ----------- ----------- ----------- ----------- Total operating income $ 32,949 $ 53,691 $ 92,841 $ 108,535 =========== =========== =========== ===========
RESULTS OF OPERATIONS SALES AND OPERATING INCOME Sales of $297 million for the second quarter of 1996 were $17 million or 5 percent lower than the second quarter of 1995 due primarily to lower log trading and merchandising sales in the Pacific Rim. Operating income of $33 million was $21 million or 39 percent lower than last year's second quarter due to lower fluff pulp pricing and continued weakness in Asian wood markets which affected pricing for logs. Sales for the six months ended June 30, 1996 of $591 million were $9 million or 1 percent lower than the prior year, and operating income of $93 million decreased $16 million or 14 percent from the prior year. 4 7 Timber and Wood Products Timber and Wood Products' sales in the second quarter were $158 million, down $15 million from the 1995 second quarter. Operating income for the quarter of $32 million was down $3 million from the prior year. Sales for the six month period were $291 million, down $23 million from the same period of 1995, with operating income of $70 million down $9 million from the prior year. The declines were due to lower log and stumpage prices reflecting continued softness in Asian markets. Log trading and merchandising sales and operating income, which include the Company's New Zealand log sales, declined from the 1995 second quarter due to weakness in Asian markets which pushed prices down for U.S. domestic and export logs. In New Zealand, volume was down compared to last year's second quarter and pricing was slightly lower, due to continued weak export markets. Timberlands management and stumpage sales improved from the second quarter of 1995 reflecting higher volume which was mostly offset by lower stumpage prices contracted during weak 1995-96 timber and wood markets. By midyear, customers in the Northwest had cut about two-thirds of the anticipated annual harvest at prices higher than the Company expects to realize in the second half of 1996. Wood products results improved significantly from a year ago due to improved lumber markets and lower log costs. Specialty Pulp Products Sales of Specialty Pulp Products were $139 million, down $8 million from last year's second quarter, and operating income declined $16 million as a result of lower fluff pulp pricing. Shipments remained strong even though the Company's Port Angeles, Washington, mill took market down time. Specialty Pulp Products sales for the first half of 1996 were $302 million, up $4 million from the prior period reflecting higher volume. Operating income declined $6 million to $29 million in 1996 reflecting lower fluff pulp prices largely offset by higher chemical cellulose prices. Fluff pulp prices declined significantly in the first six months of 1996 stabilizing late in the second quarter. The Company is undertaking a comprehensive study to help develop long-term strategies to enhance profitability and reduce the cyclicality of its specialty pulp business. The study will focus on potential growth opportunities, new end uses and the cost competitiveness of each of the pulp mills. Intersegment Six month intersegment sales of $2 million in 1996 were less than the comparable 1995 amount due to lower stumpage sales from the Timber and Wood Products segment to the Specialty Pulp Products segment. OTHER ITEMS As previously announced, the Company's results for 1996 are expected to be below last year's results. Fluff pulp pricing bottomed out in the second quarter of 1996 and appears to be on a modest upward trend with price increases announced for the third quarter. Some of this initial price move will be offset by moderate reductions in second half prices for chemical cellulose pulps, which lag the commodity pulp cycle. In the Timber and Wood Products segment, weak Asian markets will likely result in lower demand and prices for export logs and timber in the second half of 1996. The Company's Form 10-K for 1995 referred to federal environmental regulations governing air and water discharges that were proposed in 1993. In July 1996, the U.S. Environmental Protection Agency announced that it anticipates that technologies other than those which formed the basis of the proposed water regulations will be used to establish the final regulations for dissolving pulp mills. The agency said that it would await the results of studies being undertaken by the Company and other manufacturers of chemical cellulose pulps before proposing final regulations. The Company now expects that its costs to comply with these regulations will probably be less than previously estimated with implementation required at later dates than originally projected. Interest expense was $14 million for the first half of 1996, $3 million favorable to 1995, reflecting a lower average debt level, lower interest rates and higher capitalized interest expense. Minority interest in the earnings of Rayonier's subsidiary, Rayonier Timberlands, L.P. (RTLP) was relatively flat to the first half of 1995, reflecting higher Northwest U.S. stumpage volume offset by lower Southeast U.S. stumpage volume and lower prices in 5 8 both regions. The minority participation in the earnings of RTLP will change from approximately 24 percent to approximately 1 percent effective January 1, 2001. The effective tax rate for the first half of 1996 was 27.9 percent compared to 32.5 percent in the 1995 first half. The change reflects 1996 recognition of a tax asset related to a prior year transaction following resolution of various uncertainties related to its realization. NET INCOME Net income for the second quarter was $15 million or $0.51 per Common Share, down $11 million or $0.37 per Common Share from 1995. Net income for the six months ended June 30, 1996 was $47 million or $1.56 per Common Share, down $5 million or $0.16 per Common Share. LIQUIDITY AND CAPITAL RESOURCES Cash flow from operating activities of $95 million for the first six months of 1996 increased from $34 million in 1995 as a result of reduced working capital requirements. EBITDA (defined as earnings from continuing operations before non-recurring items, interest expense, income taxes and depreciation, depletion and amortization) for the first six months of 1996 of $126 million decreased $15 million from the comparable period of 1995. Cash from operations and new debt financed capital expenditures of $89 million, dividends of $17 million and the repurchase of Common Shares of $7 million. Second quarter ending debt of $465 million was $15 million greater than year-end debt. The Company's debt-to-total-capital-ratio at June 30, 1996 was 37 percent, the same level as at year-end 1995. During the first quarter of 1996, the Company began a common share repurchase program to minimize the dilutive effect on earnings per share of its employee incentive stock plans. The number of shares that may be repurchased each year is limited to the greater of 1.5 percent of the Company's outstanding shares or the number of incentive stock shares issued to employees during the year. The Company expects to repurchase approximately 300,000 to 450,000 shares in 1996. In the first six months, 191,700 shares were repurchased at an average cost of $36.03 per share with a total cost of approximately $7 million. The Company has unsecured credit facilities totaling $300 million, which are used for direct borrowings and as support for $115 million of outstanding commercial paper. As of June 30, 1996, the Company had $185 million of available borrowings under its revolving credit facilities. In addition, through currently effective shelf registration statements filed with the Securities and Exchange Commission, the Company may offer up to $141 million of new public debt securities. The Company believes that internally generated funds combined with available external financing will enable Rayonier to fund capital expenditures, share repurchases, working capital and other liquidity needs for the foreseeable future. 6 9 ITEM 3. SELECTED OPERATING DATA
Three Months Six Months Ended June 30, Ended June 30, -------------- -------------- 1996 1995 1996 1995 ---- ---- ---- ---- TIMBER AND WOOD PRODUCTS Log sales North America - millions of board feet 83 108 134 168 New Zealand - thousands of cubic meters 427 465 856 852 Other - millions of board feet 3 4 9 6 Timber harvest Northwest U.S. - millions of board feet 53 42 114 88 Southeast U.S. - thousands of short green tons 537 476 1,107 1,148 New Zealand - thousands of cubic meters 291 324 548 604 Lumber sold - millions of board feet 73 53 134 94 Intercompany sales Logs - millions of board feet 2 10 4 11 Northwest U.S. timber stumpage - millions of board feet 4 10 13 17 Southeast U.S. timber stumpage - thousands of short green tons 28 37 76 202 SPECIALTY PULP PRODUCTS Pulp sales Chemical cellulose sales - thousands of metric tons 100 103 211 208 Fluff and specialty paper pulp sales - thousands of metric tons 91 81 173 174 Production as a percent of capacity 85.7% 89.9% 89.6% 95.3% SELECTED SUPPLEMENTAL INFORMATION (thousands of dollars) New Zealand - Sales $25,709 $28,794 $ 51,005 $ 53,076 ====== ====== ======= ====== New Zealand - Operating Income $ 1,984 $ 3,714 $ 3,404 $ 7,407 ====== ====== ======= =======
7 10 PART II. OTHER INFORMATION ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS The Annual Meeting of Shareholders of the Company was held on May 17, 1996. At that meeting, three directors were elected as follows (there were no broker non-votes with respect to the election of directors):
Votes For Votes Withheld --------- -------------- Directors of Class II, Term Expires in 1999: William J. Alley 26,538,261 79,477 Paul G. Kirk, Jr. 26,250,342 367,396 Gordon I. Ulmer 26,546,950 70,788
ITEM 5. OTHER INFORMATION On July, 19, 1996, W. Lee Nutter was elected President and Chief Operating Officer and a director of the Company. On the same date, Ronald M. Gross's title was changed to Chairman and Chief Executive Officer. William J. Alley, a director of the Company, died on July 26, 1996. ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K (a) See Exhibit Index. (b) Rayonier Inc. did not file a report on Form 8-K during the quarter covered by this report. SIGNATURE Pursuant to the requirements of Section 13 of the Securities Exchange Act of l934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. RAYONIER INC. (Registrant) --------------------------- BY KENNETH P. JANETTE ------------------ Kenneth P. Janette Vice President and Corporate Controller August 13, 1996 (Chief Accounting Officer) 8 11 EXHIBIT INDEX -------------
EXHIBIT NO. DESCRIPTION LOCATION ----------- ----------- -------- 2 Plan of acquisition, reorganization, None arrangement, liquidation or succession 3.1 Amended and restated articles of incorporation No amendments 3.2 By-laws No amendments 4.1 Amendment No. 1, dated as of June 16, 1995, to Filed herewith the $100 million 364-day Revolving Credit Agreement dated as of April 14, 1995 among Rayonier Inc. as Borrower and the banks named therein as Banks, Citibank, N.A. as Administrative Agent and Citicorp Securities, Inc. and the Toronto-Dominion Bank as Arrangers 4.2 Amendment No. 2, dated as of April 12, 1996, to Filed herewith the $100 million 364-day Revolving Credit Agreement dated as of April 14, 1995 among Rayonier Inc. as Borrower and the banks named therein as Banks, Citibank, N.A. as Administrative Agent and Citicorp Securities, Inc. and the Toronto-Dominion Bank as Arrangers 4.3 Amendment No. 1, dated as of June 16, 1995, to Filed herewith the $200 million Revolving Credit Agreement dated as of April 14, 1995 among Rayonier Inc. as Borrower and the banks named therein as Banks, Citibank, N.A. as Administrative Agent and Citicorp Securities, Inc. and the Toronto-Dominion Bank as Arrangers 4.4 Amendment No. 2, dated as of April 12, 1996, to Filed herewith the $200 million Revolving Credit Agreement dated as of April 14, 1995 among Rayonier Inc. as Borrower and the banks named therein as Banks, Citibank, N.A. as Administrative Agent and Citicorp Securities, Inc. and the Toronto-Dominion Bank as Arrangers 4.5 Instruments defining the rights of security holders, Not required to be filed. The including indentures Registrant hereby agrees to file with the Commission a copy of any instrument defining the rights of holders of the Registrant's long-term debt upon request of the Commission. 10 Material contracts None 11 Statement re computation of per share earnings Not required to be filed
9 12 EXHIBIT INDEX -------------
EXHIBIT NO. DESCRIPTION LOCATION ----------- ----------- -------- 12 Statement re computation of ratios Filed herewith 15 Letter re unaudited interim financial information None 18 Letter re change in accounting principles None 19 Report furnished to security holders None 22 Published report regarding matters None submitted to vote of security holders 23 Consents of experts and counsel None 24 Power of attorney None 27 Financial data schedule Filed herewith 99 Additional exhibits None
10 EX-4.1 2 REVOLVING CREDIT AGREEMENT 1 EXHIBIT 4.1 AMENDMENT NO. 1 TO THE U.S. $100,000,000 364-DAY REVOLVING CREDIT AGREEMENT Dated as of June 16, 1995 AMENDMENT NO. 1 TO THE CREDIT AGREEMENT among Rayonier Inc., a North Carolina corporation (the "Borrower"), the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the "Lenders") and Citibank, N.A., as administrative agent (the "Administrative Agent") for the Lenders. PRELIMINARY STATEMENTS: (1) The Borrower, the Lenders and the Administrative Agent have entered into a Credit Agreement dated as of April 14, 1995, (the "Credit Agreement"). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement. (3) The Required Lenders are, on the terms and conditions stated below, willing to grant the request of the Borrower and the Borrower and the Required Lenders have agreed to amend the Credit Agreement as hereinafter set forth. SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2, hereby amended as follows: (a) Section 1.01 is amended by adding the following definition in proper alphabetical sequence: " 'RIFSL' " has the meaning specified in Section 5.02(c)(v). (b) Section 5.02(c) is amended by deleting the word "and" at the end of subclause (iii) and substituting "," therefor. 2 2 (c) Section 5.02(c) is further amended by adding at the end of subclause (iv) before the period thereto, the following: "and (v) sales from time to time during the period from June 16, 1995 through and including April 12, 1996 of accounts receivables by the Borrower to its indirect wholly owned subsidiary Rayonier International Financial Services Limited ("RIFSL"), provided that (x) RIFSL is at all times during such period an indirect wholly-owned subsidiary of the Borrower and (y) with respect to each such sale (1) the aggregate fair market value of the accounts receivables sold by the Borrower to RIFSL in each such sale shall not exceed $50,000,000, (2) such sales are for cash and (3) such sales are on terms no less favorable to the Borrower than it would obtain in a comparable arms-length transaction. SECTION 2. Conditions of Effectiveness. This Amendment shall become effective as of the date first above written when, and only when, the Administrative Agent shall have received counterparts of this Amendment executed by the Borrower and the Required Lenders or, as to any of the Lenders, advice satisfactory to the Administrative Agent that such Lender has executed this Amendment. The effectiveness of this Amendment is conditioned upon the accuracy of the factual matters described herein. This Amendment is subject to the provisions of Section 8.01 of the Credit Agreement. SECTION 3. Representations and Warranties of the Borrower. The Borrower represents and warrants that, in accordance with Section 2, on and as of the date this Amendment becomes effective: (a) The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of North Carolina. (b) The execution, delivery and performance by the Borrower of this Amendment and the Credit Agreement, as amended hereby are within the Borrower's corporate powers, have been duly authorized by all necessary corporate action, and do not contravene (i) the Borrower's charter or by-laws or (ii) law or any contractual restriction binding on or affecting the Borrower. (c) No authorization or approval or other action by, and no notice to or filing with, any governmental authority, regulatory body or any other third party is required for the due execution, delivery and performance by the Borrower of this Amendment or the Credit Agreement, as amended hereby. 3 3 (d) This Amendment has been duly executed and delivered by the Borrower and is, the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with its terms. (e) No event has occurred and is continuing that constitutes a Default. SECTION 4. Reference to and Effect on the Credit Agreement and the Notes. (a) On and after the effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like import referring to the Credit Agreement, and each reference in the Notes to "the Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment. (b) The Credit Agreement and the Notes, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement. SECTION 5. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment by telecopier shall be effective as delivery of a manually executed counterpart of this Amendment. 4 4 SECTION 6. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written. RAYONIER INC. By ------------------------------------- Name: Title: By ------------------------------------- Name: Title: CITIBANK, N.A. as Administrative Agent and as Lender By ------------------------------------- Name: Title: THE TORONTO-DOMINION BANK By ------------------------------------- Name: Title: BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By ------------------------------------- Name: Title: 5 5 THE BANK OF NEW YORK By ------------------------------------- Name: Title: THE CHASE MANHATTAN BANK, N.A. By ------------------------------------- Name: Title: MORGAN GUARANTY TRUST COMPANY OF NEW YORK By ------------------------------------- Name: Title: NATIONSBANK, N.A. (Carolinas) By ------------------------------------- Name: Title: THE SUMITOMO BANK, LIMITED NEW YORK BRANCH By ------------------------------------- Name: Title: 6 6 TRUST COMPANY BANK By ------------------------------------- Name: Title: AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED By ------------------------------------- Name: Title: FLEET BANK, N.A. By ------------------------------------- Name: Title: UNITED STATES NATIONAL BANK OF OREGON By ------------------------------------- Name: Title: EX-4.2 3 REVOLVING CREDIT AGREEMENT 1 EXHIBIT 4.2 AMENDMENT NO. 2 TO THE U.S. $100,000,000 364-DAY REVOLVING CREDIT AGREEMENT Dated as of April 12, 1996 AMENDMENT NO. 2 TO THE CREDIT AGREEMENT among Rayonier Inc., a North Carolina corporation (the "Borrower"), the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the "Lenders") and Citibank, N.A., as administrative agent (the "Administrative Agent") for the Lenders. PRELIMINARY STATEMENTS: (1) The Borrower, the Lenders and the Administrative Agent have entered into a Credit Agreement dated as of April 14, 1995, as amended as of June 16, 1995 (the "Credit Agreement"). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement. (2) The Lenders are, on the terms and conditions stated below, willing to grant the request of the Borrower, and the Borrower and the Lenders have agreed to amend the Credit Agreement as hereinafter set forth. SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2, hereby amended as follows: (a) The definition of "Termination Date" in Section 1.01 of the Credit Agreement is amended in full to read as follows: "'Termination Date' means the earlier of (a) subject to the provisions of Section 8.10, April 11, 1997 and (b) the date of termination in whole of the Commitments pursuant to Section 2.06 or 6.01.". 2 2 (b) The definition of "Applicable Margin" in Section 1.01 of the Credit Agreement is amended in full to read as follows: "'Applicable Margin' means, as of any date, a percentage per annum determined by reference to the Public Debt Rating in effect on such date as set forth below:
Applicable Margin for Public Debt Rating Eurodollar Rate S&P and Moody's Advances --------------- -------- Level 1 ------- BBB+/Baa1 .2550% or above Level 2 ------- BBB/Baa2 .2600% Level 3 ------- Less than .3000%" BBB/Baa2
(c) The definition of "Applicable Percentage" in Section 1.01 of the Credit Agreement is amended in full to read as follows: "'Applicable Percentage' means, as of any date, a percentage per annum determined by reference to the Public Debt Rating in effect on such date as set forth below:
Public Debt Rating Applicable S&P and Moody's Percentage --------------- ---------- Level 1 ------- BBB+/Baa1 .0700% or above Level 2 ------- BBB/Baa2 .0900% Level 3 ------- Less than .1500%" BBB/Baa2
3 3 (d) Section 5.02(c) of the Credit Agreement is amended in full to read as follows: "Sales, Etc. of Assets. Sell, lease, transfer or otherwise dispose of, or permit any of its Subsidiaries to sell, lease, transfer or otherwise dispose of, any assets, or grant any option or other right to purchase, lease or otherwise acquire any assets, except (i) as permitted by Section 5.02(b), (ii) any such sale, lease, transfer or disposition that is made in the ordinary course of its business, (iii) any such sale, lease, transfer or disposition by a Subsidiary of the Borrower to the Borrower or to another wholly owned Subsidiary of the Borrower (whether by dissolution, liquidation or otherwise), (iv) any such sale, lease, transfer or disposition to the extent the net book value of any single asset sold, leased, transferred or disposed of from and after April 12, 1996 pursuant to this clause (iv) is less than $2,000,000, and the aggregate of all such assets sold, leased, transferred or disposed of from and after April 12, 1996 in any given calendar year pursuant to this clause (iv) is less than $10,000,000, (v) any such sale, lease, transfer or disposition to the extent the net book value of all assets sold, leased, transferred or disposed of from and after April 12, 1996 pursuant to this clause (v) does not exceed the greater of (x) $164,793,000 and (y) 10% of the Borrower's Consolidated Assets measured as of the last day of the most recent Fiscal Quarter of the Borrower ended on or prior to such date of determination and (vi) sales from time to time during the period from June 16, 1995 through and including April 11, 1997, of accounts receivables by the Borrower to its indirect wholly owned subsidiary Rayonier International Financial Services Limited ("RIFSL"), provided that (x) RIFSL is at all times during such period an indirect wholly-owned subsidiary of the Borrower and (y) with respect to each such sale (1) the aggregate fair market value of the accounts receivables sold by the Borrower to RIFSL in each such sale shall not exceed $50,000,000, (2) such sales are for cash and (3) such sales are on terms no less favorable to the Borrower than it would obtain in a comparable arms-length transaction." (e) Schedule 5.02(a) of the Credit Agreement is hereby deleted and replaced in full with the Schedule attached hereto. SECTION 2. Conditions of Effectiveness. This Amendment shall become effective when, and only when, the Administrative Agent shall have received counterparts of this Amendment duly executed by the Borrower and the Lenders or, as to any of the Lenders, advice satisfactory to the Administrative Agent that such Lender has executed this Amendment and Section 1 hereof shall become effective when, and only when, the Agent shall have additionally received all of the following documents, each such document (unless otherwise specified) dated the date of receipt thereof by the Agent (unless otherwise specified), in form 4 4 and substance satisfactory to the Agent (unless otherwise specified) and in sufficient copies for each Lender: (a) Certified copies of all necessary corporate approvals and any necessary governmental approvals with respect to the matters contemplated by this Amendment. (b) A certificate of the Secretary or an Assistant Secretary of the Borrower certifying the names and true signatures of the officers of the Borrower authorized to sign this Amendment and the other documents to be delivered hereunder. (c) A favorable opinion of John B. Canning, Corporate Secretary and Associate General Counsel of the Borrower, that this Amendment is the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with its terms. (d) A certificate signed by a duly authorized officer of the Borrower stating that: (i) The representations and warranties contained in Section 3 are correct on and as of the date of such certificate as though made on and as of such date; and (ii) No event has occurred and is continuing that constitutes a Default. The effectiveness of this Amendment is conditioned upon the accuracy of the factual matters described herein. This Amendment is subject to the provisions of Section 8.01 of the Credit Agreement. SECTION 3. Representations and Warranties of the Borrower. The Borrower represents and warrants that, in accordance with Section 2, on and as of the date this Amendment becomes effective: (a) The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of North Carolina. (b) The execution, delivery and performance by the Borrower of this Amendment and the performance by the Borrower of the Credit Agreement, as amended hereby, are within the Borrower's corporate powers, have been duly authorized by all necessary corporate action, and do not contravene (i) the Borrower's charter or by-laws or (ii) law or any contractual restriction binding on or affecting the Borrower. 5 5 (c) No authorization or approval or other action by, and no notice to or filing with, any governmental authority, regulatory body or any other third party is required for the due execution, delivery and performance by the Borrower of this Amendment or the performance by the Borrower of the Credit Agreement, as amended hereby. (d) This Amendment has been duly executed and delivered by the Borrower and is the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with its terms. (e) No event has occurred and is continuing that constitutes a Default. SECTION 4. Reference to and Effect on the Credit Agreement and the Notes. (a) On and after the effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like import referring to the Credit Agreement, and each reference in the Notes to "the Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment. (b) The Credit Agreement and the Notes, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement. SECTION 5. Costs, Expenses. The Borrower agrees to pay on demand all costs and expenses of the Agent in connection with the preparation, execution, delivery and administration, modification and amendment of this Amendment and the other instruments and documents to be delivered hereunder (including, without limitation, the reasonable fees and expenses of counsel for the Agent) in accordance with the terms of Section 8.04 of the Credit Agreement. SECTION 6. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this 6 6 Amendment by telecopier shall be effective as delivery of a manually executed counterpart of this Amendment. SECTION 7. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written. RAYONIER INC. By ------------------------------------- Name: Title: By ------------------------------------- Name: Title: $9,333,334.50 CITIBANK, N.A. as Administrative Agent and as Lender By ------------------------------------- Name: Title: $9,333,334.50 THE TORONTO-DOMINION BANK By ------------------------------------- Name: Title: 7 7 $8,333,333.00 BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By ------------------------------------- Name: Title: $8,333,333.00 THE BANK OF NEW YORK By ------------------------------------- Name: Title: $8,333,333.00 THE CHASE MANHATTAN BANK, N.A. By ------------------------------------- Name: Title: $8,333,333.00 MORGAN GUARANTY TRUST COMPANY OF NEW YORK By ------------------------------------- Name: Title: $8,333,333.00 NATIONSBANK, N.A., formerly known as Nationsbank, N.A. (Carolinas) By ------------------------------------- Name: Title: 8 8 $8,333,333.00 THE SUMITOMO BANK, LIMITED NEW YORK BRANCH By ------------------------------------- Name: Title: $8,333,333.00 SUNTRUST BANK, ATLANTA, formerly known as Trust Company Bank By ------------------------------------- Name: Title: $8,000,000.00 SWISS BANK CORPORATION By ------------------------------------- Name: Title: $5,000,000.00 AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED By ------------------------------------- Name: Title: 9 9 $5,000,000.00 FLEET NATIONAL BANK, formerly known as Fleet National Bank of Connecticut, successor by merger to Fleet Bank, N.A. By ------------------------------------- Name: Title: $5,000,000.00 UNITED STATES NATIONAL BANK OF OREGON By ------------------------------------- Name: Title: $100,000,000.00 Total of the Commitments EX-4.3 4 REVOLVING CREDIT AGREEMENT 1 EXHIBIT 4.3 AMENDMENT NO. 1 TO THE U.S. $200,000,000 REVOLVING CREDIT AGREEMENT Dated as of June 16, 1995 AMENDMENT NO. 1 TO THE CREDIT AGREEMENT among Rayonier Inc., a North Carolina corporation (the "Borrower"), the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the "Lenders") and Citibank, N.A., as administrative agent (the "Administrative Agent") for the Lenders. PRELIMINARY STATEMENTS: (1) The Borrower, the Lenders and the Administrative Agent have entered into a Credit Agreement dated as of April 14, 1995, (the "Credit Agreement"). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement. (3) The Required Lenders are, on the terms and conditions stated below, willing to grant the request of the Borrower and the Borrower and the Required Lenders have agreed to amend the Credit Agreement as hereinafter set forth. SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2, hereby amended as follows: (a) Section 1.01 is amended by adding the following definition in proper alphabetical sequence: " 'RIFSL' " has the meaning specified in Section 5.02(c)(v). (b) Section 5.02(c) is amended by deleting the word "and" at the end of subclause (iii) and substituting "," therefor. 2 2 (c) Section 5.02(c) is further amended by adding at the end of subclause (iv) before the period thereto, the following: "and (v) sales from time to time during the period from June 16, 1995 through and including June 30, 1996, of accounts receivables by the Borrower to its indirect wholly owned subsidiary Rayonier International Financial Services Limited ("RIFSL"), provided that (x) RIFSL is at all times during such period an indirect wholly-owned subsidiary of the Borrower and (y) with respect to each such sale (1) the aggregate fair market value of the accounts receivables sold by the Borrower to RIFSL in each such sale shall not exceed $50,000,000, (2) such sales are for cash and (3) such sales are on terms no less favorable to the Borrower than it would obtain in a comparable arms-length transaction. SECTION 2. Conditions of Effectiveness. This Amendment shall become effective as of the date first above written when, and only when, the Administrative Agent shall have received counterparts of this Amendment executed by the Borrower and the Required Lenders or, as to any of the Lenders, advice satisfactory to the Administrative Agent that such Lender has executed this Amendment. The effectiveness of this Amendment is conditioned upon the accuracy of the factual matters described herein. This Amendment is subject to the provisions of Section 8.01 of the Credit Agreement. SECTION 3. Representations and Warranties of the Borrower. The Borrower represents and warrants that, in accordance with Section 2, on and as of the date this Amendment becomes effective: (a) The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of North Carolina. (b) The execution, delivery and performance by the Borrower of this Amendment and the Credit Agreement, as amended hereby are within the Borrower's corporate powers, have been duly authorized by all necessary corporate action, and do not contravene (i) the Borrower's charter or by-laws or (ii) law or any contractual restriction binding on or affecting the Borrower. (c) No authorization or approval or other action by, and no notice to or filing with, any governmental authority, regulatory body or any other third party is required for the due execution, delivery and performance by the Borrower of this Amendment or the Credit Agreement, as amended hereby. 3 3 (d) This Amendment has been duly executed and delivered by the Borrower and is, the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with its terms. (e) No event has occurred and is continuing that constitutes a Default. SECTION 4. Reference to and Effect on the Credit Agreement and the Notes. (a) On and after the effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like import referring to the Credit Agreement, and each reference in the Notes to "the Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment. (b) The Credit Agreement and the Notes, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement. SECTION 5. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment by telecopier shall be effective as delivery of a manually executed counterpart of this Amendment. 4 4 SECTION 6. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written. RAYONIER INC. By ------------------------------------- Name: Title: By ------------------------------------- Name: Title: CITIBANK, N.A. as Administrative Agent and as Lender By ------------------------------------- Name: Title: THE TORONTO-DOMINION BANK By ------------------------------------- Name: Title: BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By ------------------------------------- Name: Title: 5 5 THE BANK OF NEW YORK By ------------------------------------- Name: Title: THE CHASE MANHATTAN BANK, N.A. By ------------------------------------- Name: Title: MORGAN GUARANTY TRUST COMPANY OF NEW YORK By ------------------------------------- Name: Title: NATIONSBANK, N.A. (Carolinas) By ------------------------------------- Name: Title: THE SUMITOMO BANK, LIMITED NEW YORK BRANCH By ------------------------------------- Name: Title: 6 6 TRUST COMPANY BANK By ------------------------------------- Name: Title: AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED By ------------------------------------- Name: Title: FLEET BANK, N.A. By ------------------------------------- Name: Title: UNITED STATES NATIONAL BANK OF OREGON By ------------------------------------- Name: Title: EX-4.4 5 REVOLVING CREDIT AGREEMENT 1 EXHIBIT 4.4 AMENDMENT NO. 2 TO THE U.S. $200,000,000 REVOLVING CREDIT AGREEMENT Dated as of April 12, 1996 AMENDMENT NO. 2 TO THE CREDIT AGREEMENT among Rayonier Inc., a North Carolina corporation (the "Borrower"), the banks, financial institutions and other institutional lenders parties to the Credit Agreement referred to below (collectively, the "Lenders") and Citibank, N.A., as administrative agent (the "Administrative Agent") for the Lenders. PRELIMINARY STATEMENTS: (1) The Borrower, the Lenders and the Administrative Agent have entered into a Credit Agreement dated as of April 14, 1995, as amended as of June 16, 1995 (the "Credit Agreement"). Capitalized terms not otherwise defined in this Amendment have the same meanings as specified in the Credit Agreement. (2) The Lenders are, on the terms and conditions stated below, willing to grant the request of the Borrower, and the Borrower and the Lenders have agreed to amend the Credit Agreement as hereinafter set forth. SECTION 1. Amendments to Credit Agreement. The Credit Agreement is, effective as of the date hereof and subject to the satisfaction of the conditions precedent set forth in Section 2, hereby amended as follows: (a) The definition of "Termination Date" in Section 1.01 of the Credit Agreement is amended in full to read as follows: "'Termination Date' means the earlier of April 12, 2001 and the date of termination in whole of the Commitments pursuant to Section 2.06 or 6.01.". 2 2 (b) The definition of "Applicable Margin" in Section 1.01 of the Credit Agreement is amended in full to read as follows: "'Applicable Margin' means, as of any date, a percentage per annum determined by reference to the Public Debt Rating in effect on such date as set forth below:
Applicable Margin for Public Debt Eurodollar Rate S&P and Moody's Advances --------------- -------- Level 1 ------- A-/A1 or above .1950% Level 2 ------- BBB+/Baal .2250% Level 3 ------- BBB/Baa2 .2400% Level 4 ------- BBB-/Baa3 .3000% Level 5 ------- Less than .5000%" BBB-/Baa3
(c) The definition of "Applicable Percentage" in Section 1.01 of the Credit Agreement is amended in full to read as follows: "'Applicable Percentage' means, as of any date, a percentage per annum determined by reference to the Public Debt Rating in effect on such date as set forth below: 3 3
Public Debt Rating Applicable S&P and Moody's Percentage --------------- ---------- Level 1 ------- A-/A1 or above .0800% Level 2 ------- BBB+/Baal .1000% Level 3 ------- BBB/Baa2 .1100% Level 4 ------- BBB-/Baa3 .1500% Level 5 ------- Less than .2500%" BBB-/Baa3
(d) Section 5.02(c) of the Credit Agreement is amended in full to read as follows: "Sales, Etc. of Assets. Sell, lease, transfer or otherwise dispose of, or permit any of its Subsidiaries to sell, lease, transfer or otherwise dispose of, any assets, or grant any option or other right to purchase, lease or otherwise acquire any assets, except (i) as permitted by Section 5.02(b), (ii) any such sale, lease, transfer or disposition that is made in the ordinary course of its business, (iii) any such sale, lease, transfer or disposition by a Subsidiary of the Borrower to the Borrower or to another wholly owned Subsidiary of the Borrower (whether by dissolution, liquidation or otherwise), (iv) any such sale, lease, transfer or disposition to the extent the net book value of any single asset sold, leased, transferred or disposed of from and after April 12, 1996 pursuant to this clause (iv) is less than $2,000,000, and the aggregate of all such assets sold, leased, transferred or disposed of from and after April 12, 1996 in any given calendar year pursuant to this clause (iv) is less than $10,000,000, (v) any such sale, lease, transfer or disposition to the extent the net book value of all assets sold, leased, transferred or disposed of from and after April 12, 1996 pursuant to this clause (v) does not exceed the greater of (x) $164,793,000 and (y) 10% of the Borrower's Consolidated Assets measured as of the last day of the most recent Fiscal Quarter of the Borrower ended on or prior to such date of determination and (vi) sales from time to time during the period from June 16, 1995 through 4 4 and including June 30, 1997, of accounts receivables by the Borrower to its indirect wholly owned subsidiary Rayonier International Financial Services Limited ("RIFSL"), provided that (x) RIFSL is at all times during such period an indirect wholly-owned subsidiary of the Borrower and (y) with respect to each such sale (1) the aggregate fair market value of the accounts receivables sold by the Borrower to RIFSL in each such sale shall not exceed $50,000,000, (2) such sales are for cash and (3) such sales are on terms no less favorable to the Borrower than it would obtain in a comparable arms-length transaction." (e) Schedule 5.02(a) of the Credit Agreement is hereby deleted and replaced in full with the Schedule attached hereto. SECTION 2. Conditions of Effectiveness. This Amendment shall become effective when, and only when, the Administrative Agent shall have received counterparts of this Amendment duly executed by the Borrower and the Lenders or, as to any of the Lenders, advice satisfactory to the Administrative Agent that such Lender has executed this Amendment and Section 1 hereof shall become effective when, and only when, the Agent shall have additionally received all of the following documents, each such document (unless otherwise specified) dated the date of receipt thereof by the Agent (unless otherwise specified), in form and substance satisfactory to the Agent (unless otherwise specified) and in sufficient copies for each Lender: (a) Certified copies of all necessary corporate approvals and any necessary governmental approvals with respect to the matters contemplated by this Amendment. (b) A certificate of the Secretary or an Assistant Secretary of the Borrower certifying the names and true signatures of the officers of the Borrower authorized to sign this Amendment and the other documents to be delivered hereunder. (c) A favorable opinion of John B. Canning, Corporate Secretary and Associate General Counsel of the Borrower, that this Amendment is the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with its terms. (d) A certificate signed by a duly authorized officer of the Borrower stating that: (i) The representations and warranties contained in Section 3 are correct on and as of the date of such certificate as though made on and as of such date; and (ii) No event has occurred and is continuing that constitutes a Default. 5 5 The effectiveness of this Amendment is conditioned upon the accuracy of the factual matters described herein. This Amendment is subject to the provisions of Section 8.01 of the Credit Agreement. SECTION 3. Representations and Warranties of the Borrower. The Borrower represents and warrants that, in accordance with Section 2, on and as of the date this Amendment becomes effective: (a) The Borrower is a corporation duly organized, validly existing and in good standing under the laws of the State of North Carolina. (b) The execution, delivery and performance by the Borrower of this Amendment and the performance by the Borrower of the Credit Agreement, as amended hereby, are within the Borrower's corporate powers, have been duly authorized by all necessary corporate action, and do not contravene (i) the Borrower's charter or by-laws or (ii) law or any contractual restriction binding on or affecting the Borrower. (c) No authorization or approval or other action by, and no notice to or filing with, any governmental authority, regulatory body or any other third party is required for the due execution, delivery and performance by the Borrower of this Amendment or the performance by the Borrower of the Credit Agreement, as amended hereby. (d) This Amendment has been duly executed and delivered by the Borrower and is the legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with its terms. (e) No event has occurred and is continuing that constitutes a Default. SECTION 4. Reference to and Effect on the Credit Agreement and the Notes. (a) On and after the effectiveness of this Amendment, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof" or words of like import referring to the Credit Agreement, and each reference in the Notes to "the Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement, shall mean and be a reference to the Credit Agreement, as amended by this Amendment. (b) The Credit Agreement and the Notes, as specifically amended by this Amendment, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. 6 6 (c) The execution, delivery and effectiveness of this Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender or the Administrative Agent under the Credit Agreement, nor constitute a waiver of any provision of the Credit Agreement. SECTION 5. Costs, Expenses. The Borrower agrees to pay on demand all costs and expenses of the Agent in connection with the preparation, execution, delivery and administration, modification and amendment of this Amendment and the other instruments and documents to be delivered hereunder (including, without limitation, the reasonable fees and expenses of counsel for the Agent) in accordance with the terms of Section 8.04 of the Credit Agreement. SECTION 6. Execution in Counterparts. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Delivery of an executed counterpart of a signature page to this Amendment by telecopier shall be effective as delivery of a manually executed counterpart of this Amendment. 7 7 SECTION 7. Governing Law. This Amendment shall be governed by, and construed in accordance with, the laws of the State of New York. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized, as of the date first above written. RAYONIER INC. By ------------------------------------- Name: Title: By ------------------------------------- Name: Title: $20,666,665.50 CITIBANK, N.A. as Administrative Agent and as Lender By ------------------------------------- Name: Title: $20,666,665.50 THE TORONTO-DOMINION BANK By ------------------------------------- Name: Title: $16,666,667.00 BANK OF AMERICA NATIONAL TRUST AND SAVINGS ASSOCIATION By ------------------------------------- Name: Title: 8 8 $16,666,667.00 THE BANK OF NEW YORK By ------------------------------------- Name: Title: $16,666,667.00 THE CHASE MANHATTAN BANK, N.A. By ------------------------------------- Name: Title: $16,666,667.00 MORGAN GUARANTY TRUST COMPANY OF NEW YORK By ------------------------------------- Name: Title: $16,666,667.00 NATIONSBANK, N.A., formerly known as Nationsbank, N.A. (Carolinas) By ------------------------------------- Name: Title: $16,666,667.00 THE SUMITOMO BANK, LIMITED NEW YORK BRANCH By ------------------------------------- Name: Title: 9 9 $16,666,667.00 SUNTRUST BANK, ATLANTA, formerly known as Trust Company Bank By ------------------------------------- Name: Title: $12,000,000.00 SWISS BANK CORPORATION By ------------------------------------- Name: Title: $10,000,000.00 AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED By ------------------------------------- Name: Title: $10,000,000.00 FLEET NATIONAL BANK, formerly known as Fleet National Bank of Connecticut, successor by merger to Fleet Bank, N.A. By ------------------------------------- Name: Title: $10,000,000.00 UNITED STATES NATIONAL BANK OF OREGON By ------------------------------------- Name: Title: $200,000,000.00 Total of the Commitments EX-12 6 RATIO OF EARNINGS TO FIXED CHARGES 1 EXHIBIT 12 RAYONIER INC. AND SUBSIDIARIES RATIO OF EARNINGS TO FIXED CHARGES (UNAUDITED) (THOUSANDS OF DOLLARS)
Six Months Ended June 30, -------------- 1996 1995 --------- --------- Earnings: Net Income $ 46,881 $ 51,487 Add: Income Taxes 18,141 24,835 Minority Interest 16,537 16,572 Amortization of Capitalized Interest 982 822 --------- --------- 82,541 93,716 Adjustments to Earnings for Fixed Charges: Interest and Other Financial Charges 14,243 17,308 Interest Factor Attributable to Rentals 722 738 --------- --------- 14,965 18,046 --------- --------- EARNINGS AS ADJUSTED $ 97,506 $ 111,762 ========= ========= Fixed Charges: Fixed Charges above $ 14,965 $ 18,046 Capitalized Interest 865 511 --------- --------- TOTAL FIXED CHARGES $ 15,830 $ 18,557 ========= ========= RATIO OF EARNINGS AS ADJUSTED TO TOTAL FIXED CHARGES 6.16 6.02 ==== ====
EX-27 7 FINANCIAL DATA SCHEDULE
5 1,000 6-MOS DEC-31-1996 JAN-01-1996 JUN-30-1996 4,813 0 142,433 4,394 156,971 366,967 1,358,027 617,492 1,673,438 187,998 461,972 0 0 152,977 640,049 1,673,438 590,647 590,647 480,461 480,461 30,921 0 14,243 65,022 18,141 46,881 0 0 0 46,881 1.56 1.56
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