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Conifex Timber secures $25 million term loan

CANADA (News release) -- Conifex Timber Inc. announced that it has completed a $25 million secured term loan with PenderFund Capital Management Ltd. ("Pender"), an independent investment firm located in Vancouver, British Columbia, Canada. A portion of the term loan was utilized to repay and retire Conifex's existing lumber segment credit facility with Wells Fargo Capital Finance Corporation Canada in the amount of approximately $11 million. The balance of the term loan will be available for working capital and general corporate purposes.

The term loan has a term of 5 years, bears interest of 14% per annum and is substantially secured by Conifex's lumber segment assets. Conifex has also agreed to issue 3.6 million common share purchase warrants to Pender having a 5 year term.

Having completed the term loan, Conifex is now evaluating opportunities to secure a working capital facility to further help ensure sufficient liquidity to sustain operations through a period of below normal lumber prices. Across its lumber and power operations, Conifex's total long-term debt, including the PenderFund term loan is approximately $75.3 million having a weighted average interest rate of 9.29%.

Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing and distribution.

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