Fortress Paper Ltd. reports that its wholly-owned subsidiary, Fortress Specialty Cellulose Inc. ("FSC"), has entered into a credit agreement with a private arm's length lender, who will provide a secured revolving credit facility in the principal amount of up to $5 million to FSC, subject to certain borrowing base restrictions (the "Loan").
The Loan will mature on December 30, 2020 and will accrue interest at a rate of LIBOR plus 5.75% per annum.
The Loan is secured by FSC's wood fibre inventory located at the FSC mill, consisting of round wood, wood chips, and dissolving pulp and excluding certain non-eligible inventory. FSC intends to use the proceeds of the Loan for general corporate purposes.
Fortress Paper operates its dissolving pulp business at the Fortress Specialty Cellulose Mill located in Canada, which has expanded into the renewable energy generation sector with the construction of a cogeneration facility.
