UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q/A NO. 1
---------------
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JUNE 30, 1998
Commission File Number 333-18723
MAXXAM GROUP HOLDINGS INC.
(Exact name of Registrant as specified in its charter)
DELAWARE 76-0518669
(State or other jurisdiction (I.R.S. Employer
of incorporation or Identification Number)
organization)
5847 SAN FELIPE, SUITE 2600 77057
HOUSTON, TEXAS (Zip Code)
(Address of Principal
Executive Offices)
Registrant's telephone number, including area code: (713) 975-7600
Indicate by check mark whether the Registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities
Exchange Act of 1934 during the preceding 12 months (or for such shorter
period that the Registrant was required to file such reports), and (2) has
been subject to such filing requirements for the past 90 days.
Yes /X/ No / /
Number of shares of common stock outstanding at July 31, 1998: 1,000
Registrant meets the conditions set forth in General Instruction H(1)(a)
and (b) of Form 10-Q and is therefore filing this Form with the reduced
disclosure format.
<PAGE>
PART II. OTHER INFORMATION
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
A. EXHIBITS:
4.1 Indenture between Scotia LLC and State Street Bank and Trust
Company ("State Street"), as Trustee, regarding the Timber
Notes (incorporated herein by reference to Exhibit 4.1 to
the Quarterly Report on Form 10-Q of MAXXAM for the quarter
ended June 30, 1998, File No. 1-3924; the "MAXXAM June 30,
1998 10-Q")
4.2 Deed of Trust, Security Agreement, Financing Statement,
Fixture Filing and Assignment of Proceeds among Scotia LLC,
Fidelity National Title Insurance Company, as Trustee, and
State Street, as Collateral Agent (incorporated herein by
reference to Exhibit 4.2 to the MAXXAM June 30, 1998 10-Q)
4.3 Credit Agreement among Scotia LLC, Bank of America National
Trust and Savings Association and other financial
institutions party thereto (incorporated herein by reference
to Exhibit 4.3 to the MAXXAM June 30, 1998 10-Q)
**4.4 First Supplemental Indenture dated as of July 8, 1998,
to the Indenture dated as of December 23, 1996, between
the Company and U.S. Bank Trust National Association, as
Trustee
**4.5 Second Supplemental Indenture dated as of July 29, 1998,
to the Indenture dated as of December 23, 1996, between the
Company and U.S. Bank Trust National Association, as Trustee
*10.1 New Master Purchase Agreement between Pacific Lumber and
Scotia LLC
* 10.2 New Services Agreement between Pacific Lumber and Scotia LLC
*10.3 New Additional Services Agreement between Pacific Lumber and
Scotia LLC
*10.4 New Reciprocal Rights Agreement among Pacific Lumber, Scotia
LLC and Salmon Creek
*10.5 New Environmental Indemnification Agreement between Pacific
Lumber and Scotia LLC
*27 Financial Data Schedule
- -------------
* Previously filed as an exhibit to the Company's Quarterly Report on Form
10-Q dated July 31, 1998; File No. 333-18723
** Included with this filing
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 thereunto duly authorized, who has signed this report on
behalf of the Registrant and as the principal accounting officer of the
Registrant.
MAXXAM GROUP HOLDINGS INC.
Date: August 10, 1998 By: /S/ PAUL N. SCHWARTZ
Paul N. Schwartz
Vice President, Chief Financial
Officer and Director
Date: August 10, 1998 By: /S/ ELIZABETH D. BRUMLEY
Elizabeth D. Brumley
Assistant Controller
(Principal Accounting Officer)
MAXXAM GROUP HOLDINGS INC.
$130,000,000 12% Senior Secured Notes due 2003
FIRST SUPPLEMENTAL INDENTURE
Dated as of July 8, 1998
to
INDENTURE
Dated as of December 23, 1996
--------------------
U.S. Bank Trust National Association, Trustee
FIRST SUPPLEMENTAL INDENTURE, dated as of July 8, 1998, between
MAXXAM Group Holdings Inc., a Delaware corporation (the "Company"), and
U.S. Bank Trust National Association, a national banking association
(formerly known as First Bank National Association), as Trustee (the
"Trustee").
WHEREAS, the Company and First Bank National Association, as
trustee, executed an Indenture, dated as of December 23, 1996 (the
"Indenture"), in respect of $130,000,000 aggregate principal amount of 12%
Senior Secured Notes due 2003;
WHEREAS, the Indenture was also executed by MAXXAM Inc., a
Delaware corporation ("MAXXAM"), to confirm its agreements set forth in
Article 12 of the Indenture;
WHEREAS, for all purposes of this First Supplemental Indenture,
except as otherwise defined or unless the context otherwise requires, terms
used in capitalized form in this First Supplemental Indenture and defined
in the Indenture have the meanings specified in the Indenture;
WHEREAS, Section 9.02 of the Indenture permits the Company and
the Trustee, with the written consent of the Holders of at least a majority
of the aggregate principal amount of the Securities then outstanding, to
amend, supplement or otherwise modify the Indenture or the Securities as
hereinafter provided; and
WHEREAS, all conditions and requirements necessary to make this
First Supplemental Indenture a valid, binding and legal instrument in
accordance with its terms have been performed and fulfilled and the
execution and delivery hereof have been in all respects duly authorized.
NOW, THEREFORE, in consideration of the above premises, each
party agrees, for the benefit of the other and for the equal and ratable
benefit of the Holders of the Securities, as follows:
ARTICLE I
AMENDMENTS
The Indenture is hereby amended as follows:
1. The definition of the term "Asset Sale" in Section 1.01 of
the Indenture is hereby amended by adding the words "or New Timber Notes"
after the words "Timber Notes" in the second parenthetical of such
definition.
2. The definition of the term "Consolidated Cash Flow Coverage
Ratio" in Section 1.01 of the Indenture is hereby amended by adding the
words "or New Timber Notes" after the words "Timber Notes" in the second
parenthetical of such definition.
3. The definition of the term "Consolidated Interest Expense"
in Section 1.01 of the Indenture is hereby amended by adding the words "or
New Timber Notes" after the words "Timber Notes" in the last clause of such
definition and by adding the following sentence at the end of such
definition:
Notwithstanding the foregoing, if any New Timber Notes are
issued, for each fiscal quarter preceding the New Timber Notes
Issuance Date, Consolidated Interest Expense shall be reduced by
$10.0 million.
4. The definition of the term "Deed of Trust" in Section 1.01
of the Indenture is hereby amended by inserting the words ", prior to the
New Timber Notes Issuance Date," after the words "`Deed of Trust' means"
and by deleting the period at the end of such definition and substituting
the following therefor:
, and, from and after the New Timber Notes Issuance Date, any
deed of trust or other security document which grants a Lien on
assets of Scotia Pacific as security for the obligations of
Scotia Pacific under or in connection with any New Timber Notes,
any New Timber Note Indenture or any revolving credit agreement
or any other liquidity arrangement in connection with any New
Timber Notes, as any of the same may be amended, supplemented or
otherwise modified from time to time.
5. The definition of the term "EBITDA" in Section 1.01 of the
Indenture is hereby amended by adding the words "or New Timber Notes" after
the words "Timber Notes" in clause (A) of such definition.
6. The following three definitions are hereby inserted in
Section 1.01 of the Indenture in the appropriate alphabetical order:
"NEW TIMBER NOTES" means any secured notes in an aggregate
original principal amount not exceeding $900,000,000 issued by
Scotia Pacific during the period from July 1, 1998 through
September 30, 1998 (and any secured notes issued by Scotia
Pacific in exchange for such secured notes pursuant to one or
more exchange offers registered under the Securities Act), as any
such secured notes may be amended, supplemented or otherwise
modified from time to time, provided that any New Timber Notes
outstanding on the New Timber Notes Issuance Date (i) are
collateralized by timberlands comprising at least a majority
(measured by area) of the timberlands then owned by Pacific
Lumber and the other Restricted Subsidiaries of the Company, and
(ii) are initially rated "BBB" or higher by Standard & Poor's
Rating Services, a Division of The McGraw Hill Companies, Inc.
and "Baa2" or higher by Moody's Investor Service, Inc., or any
successor to any such corporation's business of rating
securities.
"NEW TIMBER NOTES ISSUANCE DATE" means the first date on which
any New Timber Notes shall be outstanding.
"NEW TIMBER NOTE INDENTURE" means, at any time, any indenture
pursuant to which any New Timber Notes outstanding at such time were
issued, as such indenture has been or may be amended, supplemented or
otherwise modified from time to time.
7. The definition of the term "Scotia Pacific" in Section 1.01
of the Indenture is hereby amended by deleting the word "corporation" after
the word "successor" and replacing it with the word "entity".
8. The definition of the term "Scotia Pacific Agreements" in
Section 1.01 of the Indenture is hereby amended by inserting the words "(i)
prior to the New Timber Notes Issuance Date," after the words "`Scotia
Pacific Agreements' means" and by deleting the period at the end of such
definition and substituting the following therefor:
and (ii) from and after the New Timber Notes Issuance Date, any
agreements between Scotia Pacific and Pacific Lumber (or among
Scotia Pacific, Pacific Lumber and Salmon Creek) in effect on the
date of issuance of any New Timber Notes as the same may be
amended after such date in accordance with the terms thereof,
including, without limitation, any master purchase agreement, any
services agreement, any additional services agreement, any
environmental indemnification agreement and any reciprocal rights
agreement entered into in connection with New Timber Notes.
9. The definition of the term "Unrestricted Subsidiary" in
Section 1.01 of the Indenture is hereby amended by adding the words "or New
Timber Notes" after the words "Timber Notes" in the parenthetical of the
third sentence of such definition.
10. Section 4.03(a) of the Indenture is hereby amended by
deleting the parenthetical "(other than Scotia Pacific so long as there are
any Timber Notes outstanding)" therein.
11. The first clause of Section 4.03(b) of the Indenture is
hereby amended by inserting the number "(x)," immediately preceding the
number "(xi)" in the first parenthetical of such subsection and by adding
the words "or New Timber Notes" after the words "Timber Notes" in the first
parenthetical of such subsection.
12. Section 4.03(b)(xi) of the Indenture is hereby amended by
inserting the words "or any New Timber Notes or any New Timber Note
Indenture" after the words "under the Timber Notes or the Timber Note
Indenture" and by deleting the word ", as" from the last clause after the
words "with the Timber Notes" and substituting therefor the words "or any
New Timber Notes, including Indebtedness under any revolving credit
agreement or any other liquidity arrangement in connection with any New
Timber Notes, as any of".
13. Section 4.03(c) of the Indenture is hereby amended by
deleting the parenthetical "(other than Scotia Pacific so long as there are
any Timber Notes outstanding)" therein.
14. Section 4.05(a) of the Indenture is hereby amended by
adding, in clause (i) thereof, the words "or other equity interests"
between the words "Redeemable Stock" and "of Scotia Pacific," "Redeemable
Stock" and "of any Restricted Subsidiary" and "outstanding Stock" and "of
Scotia Pacific", and by adding the following at the end of such subsection:
None of the foregoing provisions of this Section 4.05(a) shall be
deemed to have been violated by any merger of Scotia Pacific into
a limited liability company which, at the time of such merger, is
wholly owned by Pacific Lumber.
15. Section 4.06(b)(ix) of the Indenture is hereby amended by
(A) deleting the word "the" immediately prior to the words "Deed of Trust"
and substituting therefor the word "any", (B) inserting the words ", any
New Timber Note Indenture" following the words "Timber Note Indenture" and
(C) deleting the word ", as" in the last clause following the words "in
connection with the Timber Notes" and substituting therefor the words "or
any New Timber Notes, including any revolving credit agreement or any other
liquidity arrangement in connection with any New Timber Notes, as any of".
16. Section 4.10(xiii) of the Indenture is hereby amended by (A)
deleting the words "or the" after the words "the Timber Note Indenture" and
substituting therefor the words ", any New Timber Notes, any New Timber
Note Indenture or any", (B) inserting the words "or any New Timber Notes
(including in connection with any revolving credit agreement or any other
liquidity arrangement in connection with any New Timber Notes)" following
the words "with the Timber Notes" in the first instance in which such
phrase appears in such subsection and (C) inserting the words "or any New
Timber Notes" following the words "with the Timber Notes" in the second
instance in which such phrase appears in such subsection.
17. Section 4.11 of the Indenture is hereby amended by deleting
the word "the" after the words "the Timber Note Indenture," and
substituting therefor the words "any New Timber Note Indenture, any".
18. Section 5.01(iii) of the Indenture is hereby amended by
inserting the words "(A) a merger of the Company into a limited liability
company which, immediately prior to such merger, is a Wholly Owned
Restricted Subsidiary or (B)" following after the words "except in the case
of".
ARTICLE II
MISCELLANEOUS PROVISIONS
Section 2.1. Indenture. Except as amended hereby, the Indenture
and the Securities are in all respects ratified and confirmed and all their
terms shall remain in full force and effect.
Section 2.2. Governing Law. THE LAWS OF THE STATE OF NEW YORK
SHALL GOVERN THIS FIRST SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICA-
TION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY, EXCEPT
THAT THE LAWS OF THE STATE OF MINNESOTA SHALL GOVERN MATTERS CONCERNING THE
VALIDITY AND PERFECTION OF SECURITY INTERESTS OF THE TRUSTEE IN FAVOR OF
THE HOLDERS IN THE ACCOUNTS, WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES
OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 2.3. Successors. All agreements of the Company in this
First Supplemental Indenture shall bind its successors. All agreements of
the Trustee in this First Supplemental Indenture shall bind its successors.
Section 2.4. Multiple Counterparts. This First Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but
one and the same instrument.
Section 2.5. Effectiveness and Operativeness. The provisions of
this First Supplemental Indenture shall become effective immediately upon
its execution and delivery by the Trustee in accordance with the provisions
of Article 9 of the Indenture; provided, however, that the amendments
provided for in Article I shall only become operative concurrently with the
consummation of a financing transaction by Scotia Pacific Company LLC.
Section 2.6. Termination. If the amendments provided for in
Article I have not become operative on or prior to September 30, 1998, such
amendments shall be deemed to have been rescinded and this First
Supplemental Indenture shall be of no force or effect.
(REMAINDER OF PAGE INTENTIONALLY LEFT BLANK)
<PAGE>
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed, all as of the date first
written above.
Attest: MAXXAM GROUP HOLDINGS INC.
By: /S/ LISA S. BLAHA By: /S/ DELONA J. MOORE
Name: Lisa S. Blaha Name: Delona J. Moore
Title: Assistant Secretary Title: Assistant Treasurer
Attest: U.S. BANK TRUST NATIONAL
ASSOCIATION
By: /S/ JUDITH M. ZUZEK
Name: Judith M. Zuzek By: /S/ RICHARD H. PROKOSCH
Title: Assistant Secretary Name: Richard H. Prokosch
Title: Assistant Vice
President
MAXXAM Inc. hereby consents to the
execution and delivery of this
First Supplemental Indenture and
confirms its agreements set forth
Attest: in Article 12 of the Indenture
By: /S/ LISA S. BLAHA By: /S/ BERNARD L. BIRKEL
Name: Lisa S. Blaha Name: Bernard L. Birkel
Title: Assistant Secretary Title: Secretary
MAXXAM GROUP HOLDINGS INC.
$130,000,000 12% Senior Secured Notes due 2003
SECOND SUPPLEMENTAL INDENTURE
Dated as of July 29, 1998
to
INDENTURE
Dated as of December 23, 1996
--------------------
U.S. Bank Trust National Association, Trustee
SECOND SUPPLEMENTAL INDENTURE, dated as of July 29, 1998, between
MAXXAM Group Holdings Inc. (the "Company") and U.S. Bank Trust National
Association, a national banking association (formerly known as First Bank
National Association), as Trustee (the "Trustee").
WHEREAS, the Company and First Bank National Association, as
trustee, executed an Indenture, dated as of December 23, 1996, in respect
of $130,000,000 aggregate principal amount of 12% Senior Secured Notes due
2003 (the "Indenture");
WHEREAS, the Indenture was supplemented and amended by a First
Supplemental Indenture dated as of July 8, 1998;
WHEREAS, the Indenture, as supplemented and amended by such First
Supplemental Indenture, is hereinafter referred to as the "Indenture";
WHEREAS, the Indenture was also executed by MAXXAM Inc. to
confirm its agreements set forth in Article 12 of the Indenture;
WHEREAS, for all purposes of this Second Supplemental Indenture,
except as otherwise defined or unless the context otherwise requires, terms
used in capitalized form in this Second Supplemental Indenture and defined
in the Indenture have the meanings specified in the Indenture;
WHEREAS, Section 9.01 of the Indenture permits the Company and
the Trustee to amend, supplement or otherwise modify the Indenture or the
Securities as hereinafter provided; and
WHEREAS, all conditions and requirements necessary to make this
Second Supplemental Indenture a valid, binding and legal instrument in
accordance with its terms have been performed and fulfilled and the
execution and delivery hereof have been in all respects duly authorized.
NOW, THEREFORE, in consideration of the above premises, each
party agrees, for the benefit of the other and for the equal and ratable
benefit of the Holders of the Securities, as follows:
ARTICLE I
AMENDMENTS
The Indenture is hereby amended as follows:
1. Section 4.03(a) of the Indenture is hereby amended by
replacing the number 2.0 in such section with the number 3.2.
2. Section 5.01 of the Indenture is hereby amended by replacing
the number 2.0 in clause (iii) of such section with the number 3.2.
3. Section 10.01(b) of the Indenture is hereby amended by
deleting the first sentence following clause (iv) of such section.
4. Section 10.05(c)(1) of the Indenture is hereby amended by
replacing the number 16,055,000 in clause (iii) of such subsection with the
number 27,938,250.
5. Exhibit D to the Indenture is hereby amended to read in its
entirety as follows:
<TABLE>
<CAPTION>
Company Type of Stock Certificate No. No. of Shares
<S> <C> <C> <C>
Kaiser Aluminum Common SFU 1216 27,938,250
Corporation
MAXXAM Group Common 2 100
Inc.
</TABLE>
ARTICLE II
PLEDGE OF RELEASED KAISER SHARES
To secure the full and punctual payment of principal and premium
of and interest on the Securities and all other amounts payable pursuant to
the Indenture, MGHI hereby grants to the Trustee, pursuant to Section
10.1(b) of the Indenture, for the benefit of the Holders and the Trustee, a
first priority and (except for Liens permitted under Section 4.16 of the
Indenture) exclusive security interest in all its right, title and interest
in and to the following:
(i) the 27,938,250 shares of Common Stock, par value $.01 per
share, of Kaiser described on Exhibit D to the Indenture, as amended
by this Second Supplemental Indenture;
(ii) all certificates whether now owned or hereafter acquired
representing any of the shares referred to in clause (i) of this
Article II;
(iii)all dividends, cash, instruments and other property and
proceeds from time to time received, receivable or otherwise
distributed on or in exchange for any of the foregoing after the date
hereof, including, without limitation, any stocks, bonds or other
securities, options, warrants, or other such rights, cash or other
property payable or distributable on any of the shares referred to in
clause (i) of this Article II at any time after the date hereof,
including, without limitation, any distribution on any such shares
upon the dissolution or liquidation, in whole or in part, of the
issuer of such shares or the consolidation or merger of such issuer
with any other person or persons, or the reorganization of such
issuer, or any distribution on any such shares of the capital or
paid-in capital surplus or any part thereof of the issuer of such
shares, in any form, or any subdivision, combination, reclassification
or redemption of any such shares; and
(iv) to the extent not included in clauses (i), (ii) and (iii) of
this Article II, all proceeds (as defined in the Uniform Commercial
Code as in effect on the date of the Indenture) of any and all of the
foregoing (arising after the date hereof).
ARTICLE III
MISCELLANEOUS PROVISIONS
Section 2.1. Indenture. Except as amended hereby, the Indenture
and the Securities are in all respects ratified and confirmed and all their
terms shall remain in full force and effect.
Section 2.2. Governing Law. THE LAWS OF THE STATE OF NEW YORK
SHALL GOVERN THIS SECOND SUPPLEMENTAL INDENTURE WITHOUT GIVING EFFECT TO
APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICA-
TION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY, EXCEPT
THAT THE LAWS OF THE STATE OF MINNESOTA SHALL GOVERN MATTERS CONCERNING THE
VALIDITY AND PERFECTION OF SECURITY INTERESTS OF THE TRUSTEE IN FAVOR OF
THE HOLDERS IN THE ACCOUNTS, WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES
OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF
ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.
Section 2.3. Successors. All agreements of the Company in this
Second Supplemental Indenture shall bind their successors. All agreements
of the Trustee in this Second Supplemental Indenture shall bind its
successors.
Section 2.4. Multiple Counterparts. This Second Supplemental
Indenture may be executed in any number of counterparts, each of which
shall be an original; but such counterparts shall together constitute but
one and the same instrument.
Section 2.5. Effectiveness. The provisions of this Second
Supplemental Indenture shall become effective immediately upon its
execution and delivery by the Trustee in accordance with the provisions of
Article 9 of the Indenture.
(REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK)
<PAGE>
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Second
Supplemental Indenture to be duly executed, all as of the date first
written above.
Attest: MAXXAM GROUP HOLDINGS INC.
By: /S/ LISA S. BLAHA By: /S/ DELONA J. MOORE
Name: Lisa S. Blaha Name: Delona J. Moore
Title: Assistant Secretary Title: Assistant Treasurer
Attest: U.S. BANK TRUST NATIONAL
ASSOCIATION
By: /S/ JUDITH M. ZUZEK
Name: Judith M. Zuzek By: /S/ RICHARD H. PROKOSCH
Title: Assistant Secretary Name: Richard H. Prokosch
Title: Assistant Vice
President
MAXXAM Inc. hereby consents to the
execution and delivery of this
Second Supplemental Indenture and
confirms its agreements set forth
Attest: in Article 12 of the Indenture
By: /S/ LISA S. BLAHA By: /S/ PAUL N. SCHWARTZ
Name: Lisa S. Blaha Name: Paul N. Schwartz
Title: Assistant Secretary Title: President
