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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported):
July 10, 1998
KTI, INC.
(Exact name of Registrant as specified in Charter)
New Jersey 33-85234 22-2665282
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(State or other juris- (Commission (IRS Employer
diction of incorporation) File Number) Identification
Number)
7000 Boulevard East, Guttenberg, New Jersey 07093
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(Address of principal executive office) (Zip Code)
Registrant's telephone number including area code- (201) 854-7777
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Not Applicable
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(Former name and former address, as changed since last report)
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Item 5. Other Events
On July 10, 1998, KTI, Inc. (the "Company" or the "Registrant") and
certain of its subsidiaries, collectively, the "Borrowers", entered into a $150
million Revolving Credit Agreement (the "Revolving Credit Agreement") with
KeyBank, National Association ("KeyBank"), both individually and as agent for
other financial institutions. The Revolving Credit Agreement replaces the prior
Revolving and Term Loan and Security Agreement (the "Loan and Security
Agreement") with KeyBank, individually. The Loan and Security Agreement provided
for a revolving line of credit for $30 million and a term loan of $7.5 million.
The Revolving Credit Agreement has the following principal terms:
A. The Revolving Credit Agreement may be used for general working capital
purposes, issuance of letters of credit and for acquisitions. (Up to $15
million under the Revolving Credit Agreement may be used for the issuance
of letters of credit.) Information packages must be submitted to the
Lenders on acquisitions with a cost of $5 million or more (such cost
includes, without limitation, any debt assumed with the assets acquired or
owed by any acquired company in the case of a stock purchase and covenants
not to compete, but does not include any "earnout" or other contingent
payments). Acquisitions with a cost of $10 million or more require
approval from Lenders holding in aggregate not less than a 75%
participation in the Revolving Credit Agreement.
B. Loans may be obtained by any Borrower, based on either the Base Rate of
KeyBank or on LIBOR, at the Borrower's option. All loans are the joint and
several obligation of each Borrower. The actual rates paid on each Loan
will vary, depending on the ratio of total senior funded debt to
consolidated adjusted EBITDA, as determined from time to time.
C. The Revolving Credit Agreement terminates on April 30, 2001.
D. The Revolving Credit Agreement is secured by all of the assets of the
Company (other than certain assets pledged to third party lenders and the
stock of the Company's K-C International, Ltd. subsidiary) and all of the
assets (other than certain assets pledged to third party lenders) of the
Company's subsidiaries, other than Data Destruction Services, Inc.; K-C
International, Ltd., KTI Environmental Group, Inc.; Maine Energy Recovery
Company, Limited Partnership; Penobscot Energy Recovery Company, Limited
Partnership and Timber Energy Resources, Inc. Timber Energy Resources,
Inc. issued its guaranty to KeyBank in connection with the Revolving
Credit Agreement. KTI Environmental Group, Inc. has pledged its limited
partnership interest in PERC Management Company Limited Partnership.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
KTI, Inc.
(the Registrant)
Dated: July 10, 1998 By: /s/ Martin J. Sergi
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Name: Martin J. Sergi
Title: President
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Item 7. Exhibits
Exhibit Number Description
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4.1 Revolving Credit Agreement dated July 10, 1998 among
KTI, Inc. and the Subsidiary Borrowers, Jointly and
Severally as the Borrower, KeyBank National Association
and other financial institutions as Lenders and KeyBank
National Association, as Agent. The schedules to this
Exhibit do not contain information which is material to
an investment decision and which is not otherwise
disclosed in the Revolving Credit Agreement. The Company
hereby agrees to furnish a copy of any omitted schedule
to the Commission upon request.
4.2 News Release dated July 10, 1998