Clearwater Paper Files 8‑K: New Credit Agreement and Redemption of $275M Notes

What Happened

• Clearwater Paper Corporation announced on September 18, 2026 that it entered into a Second Amended and Restated Credit Agreement providing a $275 million Term Loan Facility and a $200 million Revolving Loan Facility (subject to borrowing base limits). The Company used the proceeds to fund the full redemption of its outstanding $275 million 4.750% Senior Notes due 2028 and to terminate its ABL credit facility. The Company notified note holders on September 18, 2026 that the 2028 Notes would be redeemed on October 3, 2026 and deposited funds with the trustee; $1.7 million of accrued interest was paid in connection with the redemption.

Key Details

• Credit facilities: $275M term loan (fully drawn at closing) + $200M revolver (maximum; $15M drawn at closing); up to $10M of the revolver can be used for letters of credit. Possible increase to revolver commitments by up to $100M after FY2027 subject to lender commitments.
• Maturity and repayment: revolver and commitments terminate September 18, 2031. Term loan requires $5.5M annual principal installments each December 1 starting Dec. 1, 2027, with remaining principal due at maturity; prepayments allowed without penalty.
• Pricing and collateral: initial interest rate ~8.25% p.a. (SOFR‑based or agent rates plus a margin of 2.50%–4.75% depending on leverage). Obligations secured by liens on substantially all personal property and, after post‑closing conditions, material real property (including mills in GA, AR, ID).
• Covenants and defaults: financial covenants include a Debt Service Coverage Ratio (2.65x through Q2 2027; 2.75x for Q3 2027; 3.00x thereafter) and a current ratio ≥1.75x. Agreement contains customary affirmative/negative covenants and events of default (including change of control >40%).

Why It Matters

• This refinancing replaces the prior term revolver and ABL facilities, extends the company’s secured financing runway to 2031, and uses proceeds to eliminate $275M of higher‑priority notes due in 2028. Investors should note the initial cash interest cost (about 8.25% at closing), the secured nature of the debt, and the new financial covenants that could limit flexibility if operating results weaken. The optional revolver expansion and letters‑of‑credit capacity provide some additional liquidity options, but the collateral and covenants increase lender protections compared with unsecured notes.