SOURCE: Port Townsend Paper Corporation

March 30, 2007 17:54 ET

Port Townsend Paper Corporation Receives Interim Court Approval of $50 Million Debtor in Possession Financing

PORT TOWNSEND, WA -- (MARKET WIRE) -- March 30, 2007 -- Port Townsend Paper Corporation and its affiliates (the "Company") today announced that it has received interim approval from the U.S. Bankruptcy Court for the Western District of Washington (the "Court") to obtain up to $38 million in replacement debtor in possession ("DIP") financing. The replacement DIP facility includes an aggregate commitment of $50 million which will be made fully available to the Company upon final approval by the Court. Proceeds from the replacement DIP facility will be used to retire the Company's obligations under its current DIP facility in addition to providing the Company with increased working capital to meet the Company's liquidity needs in Chapter 11.

The replacement DIP facility is being provided by certain holders of the Company's 11% Senior Secured Notes due 2011 (the "Notes," and a holder thereof, a "Noteholder"). All Noteholders of record, as of March 29, 2007, are eligible to purchase notes issued under the replacement DIP facility and will receive a participation notice which contains the terms, conditions, and instructions on how to become a participant under the facility. The deadline for becoming a note purchaser under the replacement DIP facility is April 5, 2007. All inquires concerning Noteholder participation should be directed to Timothy P. Leybold, the Company's Chief Financial Officer.

"The new facility has been provided by a group of the Company's noteholders and demonstrates their continued commitment to the business and assures the Company's viability for the foreseeable future," said John Begley, Chief Executive Officer. "The financing allows us to get back on a fast track to confirm the plan of reorganization," continued Begley.

Copies of court documents filed in connection with the Chapter 11 cases are available via the Court's website at www.wawb.uscourts.gov. Please note that a PACER password is required to access the documents via the Court's website.

The Port Townsend Paper family of companies employs approximately 800 people and annually produces more than 320,000 tons of unbleached Kraft pulp, paper and linerboard at its mill in Port Townsend, Washington. The Company also manufactures approximately 1.8 billion square feet of corrugated products annually at its three Crown Packaging Plants and two BoxMaster Plants located in British Columbia and Alberta. For more information on Port Townsend Paper Corporation, please see the Company's websites at www.ptpc.com and www.crownpackaging.com.

Some of the statements in this press release are forward-looking statements. Forward-looking statements include statements about our future financial condition, our industry and our business strategy. Statements that contain words such as "will," "should," "anticipate," "believe," "expect," "intend," "estimate," "hope" or similar expressions, are forward-looking statements. These forward-looking statements are based on the current expectations of Port Townsend Paper Corporation, its parent, PT Holdings Company, Inc. and all of its subsidiaries. Because forward-looking statements involve inherent risks and uncertainties, the plans, actions and actual results Port Townsend Paper Corporation, PT Holdings Company, Inc. and its subsidiaries, could differ materially. Among the factors that could cause plans, actions and results to differ materially from current expectations include the following: the impact of general economic conditions; containerboard and corrugated products general industry conditions, including competition, product demand and product pricing; fluctuation in wood fiber and recycled fiber costs; fluctuations in purchased energy costs; and legislative or regulatory requirements, particularly concerning environmental matters.

Contact Information

  • Contact:
    Timothy P. Leybold
    Port Townsend Paper Corporation
    (360) 385-3170