Rock-Tenn amends credit facility to increase repurchases of notes

By Angela McDaniels

Tacoma, Wash., July 27 - Rock-Tenn Co. and Rock-Tenn Co. of Canada amended their credit facility on July 21 to expand the company's ability to refinance its senior notes due 2016, according to an 8-K filing with the Securities and Exchange Commission.

The amendment also expands Rock-Tenn's authority to redeem or repurchase its senior notes due 2011 and/or senior notes due 2013 in an amount not to exceed:

• $85 million in any fiscal year of the company plus, beginning with the fiscal year ending on Sept. 30, 2011, the unused amount available under the annual limit for the immediately preceding fiscal year; and

• $170 million for all such redemptions or repurchases of the 2011 and 2013 notes.

If the company's pro forma leverage ratio does not exceed 3 to 1, Rock-Tenn may make additional purchases of the 2011 and 2013 notes in an amount not to exceed $100 million, which is an increase of $25 million.

After giving effect to any such purchases, the company must have at least $300 million of availability under the revolving committed amount.

In addition, the amendment provides that the company will not have to prepay the loans with the proceeds from any debt issuance to the extent that those proceeds are used to repay the 2011/2013 notes at maturity, redeem or repurchase the 2011/2013 notes or prepay the term loans, in each case within one year of the debt issuance.

The amendment also provides that the company may incur debt in connection with the 2016 notes and incur unsecured debt in a principal amount not to exceed $100 million, provided that the maturity date of such unsecured debt is not earlier than one year following the term loan B maturity date.

Wachovia Bank, NA is the administrative agent.

RockTenn is a Norcross, Ga., manufacturer of paperboard, containerboard, consumer and corrugated packaging and merchandising displays.

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