8-K

UNITED STATES
 
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

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): April 8, 2003
 

Rock-Tenn Company

(Exact Name of Registrant as Specified in Its Charter)

Georgia	0-23340	62-0342590
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

504 Thrasher Street, Norcross, Georgia	30071
(Address of Principal Executive Offices)	(Zip Code)

(770) 448-2193
(Registrant’s telephone number, including area code)

TABLE OF CONTENTS

	Item 5. Other Events.
	Item 7. Financial Statements and Exhibits
	Item 9. Regulation FD Disclosure.
SIGNATURES
INDEX TO EXHIBITS
EX-99.1 TEXT OF PRESS RELEASE
EX-99.2 THIRD AMENDMENT TO CREDIT AGREEMENT
EX-99.3 TEXT OF PRESS RELEASE
EX-99.4 SLIDE PRESENTATION
EX-99.5 CHART THAT COMPARES THE ROIC OF ROCK-TENN

Item 5. Other Events.

April 2 Press Release

On April 2, 2003, Rock-Tenn Company (“Rock-Tenn”) issued a press release (the “April 2 Press Release”) that announced that it has amended its bank credit facility and renewed its asset securitization facility. A copy of the April 2 Press Release is attached hereto as Exhibit 99.1 and hereby incorporated herein. A copy of the Third Amendment to the Credit Agreement is attached hereto as Exhibit 99.2 and hereby incorporated herein.

April 8 Press Release

On April 8, 2003, Rock-Tenn issued a press release (the “April 8 Press Release”) that set forth:

• Rock-Tenn’s guidance of earnings per share for the second fiscal quarter of 2003.

• Rock-Tenn’s debt balance at the end of the second fiscal quarter of 2003 compared to the balance on September 30, 2002.

• Rock-Tenn’s capital expenditures during the second fiscal quarter of 2003 as compared with its previous estimate for fiscal year 2003.

A copy of the April 8 Press Release is attached hereto as Exhibit 99.3 and hereby incorporated herein.

Forward-Looking Statements

Statements made in this report and the exhibits hereto, including statements regarding expected earnings, debt levels, capital expenditures, and expected credit availability, constitute “forward-looking statements” within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such statements are based on current expectations and beliefs and involve risks, uncertainties, and assumptions that could cause actual results to differ materially from those contained in any forward-looking statement. Such factors are described in Rock-Tenn’s filings with the Securities and Exchange Commission.

Item 7. Financial Statements and Exhibits

(c) Exhibits

99.1	Text of Press Release of Rock-Tenn Company, dated April 2, 2003.
99.2	Third Amendment to the Credit Agreement, dated March 31, 2003.
99.3	Text of Press Release of Rock-Tenn Company, dated April 8, 2003.
99.4	Rock-Tenn’s Slide Presentation from the SunTrust Robinson Humphrey 32nd Annual Institutional Investor Conference.
99.5	Chart that compares the ROIC of Rock-Tenn with the ROIC of four peers using pre-tax interest rather than interest after tax to calculate ROIC and a reconciliation of Rock-Tenn’s ROIC using pre-tax interest with Rock-Tenn’s ROIC using interest after tax.

Item 9. Regulation FD Disclosure.

The following information is furnished pursuant to Item 12, “Results of Operations and Financial Condition.”

On April 8, 2003, Rock-Tenn issued the April 8 Press Release in which it disclosed unaudited financial information related to earnings per share, debt balance, and capital expenditures for the second quarter of fiscal 2003. A copy of the April 8 Press Release is attached hereto as Exhibit 99.3 and hereby incorporated herein.

On April 8, 2003, James A. Rubright, Rock-Tenn’s Chairman and Chief Executive Officer, made a public presentation at the SunTrust Robinson Humphrey 32nd Annual Institutional Investor Conference (the “Presentation”). On April 7, 2003, Rock-Tenn issued a press release

announcing that Mr. Rubright would speak at the conference and that investors could access a webcast of the Presentation on the Rock-Tenn website, both live and archived for seven days. Rock-Tenn also made available on its website a copy of the slides included as part of the Presentation. A copy of these slides (the “Slide Presentation”) is set forth in the attached Exhibit 99.4 and hereby incorporated herein. All information in the Slide Presentation is presented as of April 8, 2003, and Rock-Tenn does not assume any obligation to correct or update such information in the future.

The Slide Presentation includes a slide (slide 22 of 24) entitled “ROIC vs. Folding Carton Peers.” This slide is a chart that compares the ROIC (return on invested capital) of Rock-Tenn with the ROIC of four peers. The slide identifies the financial information that Rock-Tenn used to calculate ROIC, a non-GAAP ratio, which includes certain GAAP financial measures and one non-GAAP financial measure, interest after tax.

Rock-Tenn does not believe that there is a GAAP measure that is directly comparable to ROIC. Rock-Tenn believes that pre-tax interest is the financial measure most directly comparable to interest after tax that is calculated and presented in accordance with GAAP. Further, if Rock-Tenn calculated ROIC using pre-tax interest, the ROIC ratio would not be a non-GAAP financial measure. A chart that compares the ROIC of Rock-Tenn with the ROIC of four peers using pre-tax interest rather than interest after tax to calculate ROIC is attached hereto as Exhibit 99.5 and hereby incorporated herein. Exhibit 99.5 also includes a reconciliation of Rock-Tenn’s ROIC using pre-tax interest with Rock-Tenn’s ROIC using interest after tax.

Management believes that ROIC, calculated using interest after tax, helps investors more easily evaluate Rock-Tenn’s results of operation, both over time and as compared with its peers. Management regularly uses this ROIC ratio to similarly evaluate the performance of each of its divisions as well as the overall performance of Rock-Tenn. Further, management believes that calculating ROIC using interest after tax offers investors a more effective analysis of the rate of return on invested capital because it takes into consideration interest paid on debt as a deductible business expense that reduces the cost of the debt capital.

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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.

		ROCK-TENN COMPANY (Registrant)
Date: April 9, 2003	By:	/s/ STEVEN C. VOORHEES
		Steven C. Voorhees, Executive Vice-President and Chief Financial Officer (Principal Financial Officer, Principal Accounting Officer and duly authorized officer)

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INDEX TO EXHIBITS

Exhibit Number and Description

99.1	Text of Press Release of Rock-Tenn Company, dated April 2, 2003.
99.2	Third Amendment to the Credit Agreement, dated March 31, 2003.
99.3	Text of Press Release of Rock-Tenn Company, dated April 8, 2003.
99.4	Rock-Tenn’s Slide Presentation from the SunTrust Robinson Humphrey 32nd Annual Institutional Investor Conference.
99.5	Chart that compares the ROIC of Rock-Tenn with the ROIC of four peers using pre-tax interest rather than interest after tax to calculate ROIC and a reconciliation of Rock-Tenn’s ROIC using pre-tax interest with Rock-Tenn’s ROIC using interest after tax.

5 EX-99.1 3 g81980exv99w1.htm EX-99.1 TEXT OF PRESS RELEASE

EXHIBIT 99.1

Rock-Tenn Company Announces Amendment to its Bank Credit Facility and the Renewal of its Asset Securitization Facility

NORCROSS, Ga., April 2, 2003 (BUSINESS WIRE) — Rock-Tenn Company (NYSE: RKT) announced that it has amended its bank credit facility and renewed its asset securitization facility.

The Company has reduced the amount of available borrowing capacity under the bank credit facility from $300 million to $125 million. The amendment to the bank credit facility reduces the minimum fixed charge coverage ratio from 2:1 to 1.75:1 and increases the maximum funded debt to EBITDA ratio from 3.5:1 to 4:1 through September 30, 2004 and to 3.75:1 thereafter. The amendment to the bank credit facility excludes the cash costs of certain plant closings from the fixed charge and funded debt to EBITDA covenant calculations and also excludes from the calculation of the minimum consolidated net worth covenant pension plan charges and credits taken to other comprehensive income after September 30, 2001. The Company renewed its $125 million asset securitization facility through March 29, 2004.

Executive Vice President and Chief Financial Officer Steve Voorhees said, “As a result of our recent issuance of $100 million of 10 year notes at an interest rate of 5.625%, we decided to reduce the bank credit facility from $300 million to $125 million. We amended the covenants in the facility to provide additional financial flexibility. Our combined credit availability under these two facilities is expected to exceed $75 million as of March 31, 2003.”

Statements herein regarding the expected credit availability of the Company constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such statements are based on the Company’s expected earnings, which are subject to market and operating risks and uncertainties that could cause actual amounts to differ materially from those projected.

Rock-Tenn Company is one of North America’s leading packaging companies, with annual net sales of over $1.4 billion and over 75 manufacturing operations in the United States, Canada, Mexico and Chile.

EX-99.2 4 g81980exv99w2.htm EX-99.2 THIRD AMENDMENT TO CREDIT AGREEMENT

EXHIBIT 99.2

THIRD AMENDMENT TO CREDIT AGREEMENT

     THIS THIRD AMENDMENT TO CREDIT AGREEMENT is dated as of March 31, 2003 (the “Amendment”), by and among ROCK-TENN COMPANY, a Georgia corporation (the “Borrower”), SUNTRUST BANK, a banking corporation organized under the laws of the State of Georgia (“SunTrust”), the other banks and financial institutions listed on the signature pages hereof (SunTrust and such other banks, lending institutions and assignees thereof referred to collectively herein as the “Lenders”), SUNTRUST BANK, in its capacity as Agent for the Lenders (the “Agent”), BANK OF AMERICA, N.A., as Syndication Agent (the “Syndication Agent”) and WACHOVIA BANK, N.A., as Documentation Agent (the “Documentation Agent”).

     WHEREAS, the Borrower, the Agent, the Syndication Agent, the Documentation Agent and the Lenders are parties to that certain Credit Agreement dated as of June 30, 2000, as amended by that certain First Amendment to Credit Agreement, dated as of April 6, 2001, and that certain Second Amendment to Credit Agreement, dated as of July 26, 2001 (as amended, the “Credit Agreement”; all capitalized terms not otherwise defined herein shall have the meanings set forth in the Credit Agreement), pursuant to which the Lenders have made available certain financial accommodations to the Borrower; and

     WHEREAS, the Borrower reduced the Revolving Credit Commitment of all Lenders to $125,000,000 effective as of March 19, 2003, and each Lender’s Revolving Credit Commitment as of such date has been reduced as set forth in Section 2.3 of the Credit Agreement; and

     WHEREAS, the parties wish to amend the Credit Agreement on the terms and conditions contained herein;

     NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows:

     Section 1.  Amendments.

          (a) The Credit Agreement is hereby amended by deleting the definition of “Fee Letter” from Section 1.1 and substituting in lieu thereof the following new definition of “Fee Letter”:

“Fee Letter” means, collectively, that certain letter agreement dated May 30, 2000, between the Borrower, the Agent and SunTrust Equitable Securities Corporation and that certain fee letter dated March 7, 2003, by SunTrust Capital Markets, Inc. and the Agent and acknowledged and agreed to by the Borrower, each relating to certain fees from time to time payable by the Borrower to the Agent, SunTrust Equitable Securities Corporation and SunTrust Capital Markets, Inc., together with all amendments and supplements thereto.

          (b) The Credit Agreement is hereby amended by deleting the definition of “Consolidated Net Worth” from Section 1.1 and substituting in lieu thereof the following new definition of “Consolidated Net Worth”:

     “Consolidated Net Worth” shall mean the stockholders’ equity of the Consolidated Companies plus any OCI pension plan charges taken after September 30, 2001, minus (i) Restricted Investments, but only to the extent the Restricted Investments exceed in the aggregate ten percent (10%) of stockholders’ equity, and (ii) OCI pension plan credits taken after September 30, 2001. For purposes of this definition, stockholders’ equity shall be determined on a consolidated basis in accordance with GAAP, as applied on a consistent basis by the Borrower in the calculation of such amounts in the Borrower’s most recent Financial Reports.

          (c) The Credit Agreement is hereby amended by deleting the definition of “EBITDA” from Section 1.1 and substituting in lieu thereof the following new definition of “EBITDA”:

     “EBITDA” shall mean for any fiscal period, Consolidated Net Income (or Consolidated Net Loss, as the case may be) for such period plus (a) the aggregate amount deducted in determining such Consolidated Net Income (Loss) in respect of (i) Interest Expense, (ii) Income Taxes of the Consolidated Companies determined in accordance with GAAP, (iii) depreciation and amortization expense of the Consolidated Companies determined in accordance with GAAP, in each case for the applicable fiscal period, (iv) the amount of any non-cash charges relating to plant shut-downs and asset impairment charges actually taken by the Borrower for the quarter ending March 31, 2000, (v) any non-cash charges actually taken by the Consolidated Companies after March 31, 2000 which are associated with the accelerated write-off of any tangible or intangible assets related to the acquisition of Waldorf Corporation provided such amounts do not exceed $100,000,000 in the aggregate through the Maturity Date, (vi) any non-cash charges actually taken which are associated with the accelerated write-off of any tangible or intangible assets provided such amounts do not exceed $50,000,000 in the aggregate through the Maturity Date, (vii) the amount of cash charges actually taken which resulted from the Home Office and Folding Carton Division reorganizations and the closing of the Borrower’s Downingtown, Pennsylvania converting facility, Norcross, Georgia folding facility, Lynchburg, Virginia converting facility, Augusta, Georgia folding facility, Madison, Wisconsin folding facility, and Chicago, Illinois folding facility in an aggregate amount not to exceed $4,832,000 for the fiscal quarter ending June 30, 2000, $5,637,000 for the fiscal quarter ending September 30, 2000, $1,906,000 for the fiscal quarter ending December 31, 2000 and an aggregate of $7,000,000 thereafter, in each case for the Consolidated Companies determined on a consolidated basis in accordance with GAAP, (viii) the amount of cash charges actually taken which resulted from the closing of the Borrower’s El Paso, Texas folding facility, Hunt Valley, Maryland display packout facility and the Vineland,

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New Jersey converting facility and the shutdown of the Borrower’s Dallas, Texas paperboard machine, all such cash charges in an aggregate amount not to exceed $2,500,000, in each case for the Consolidated Companies determined on a consolidated basis in accordance with GAAP, and (ix) the amount of cash charges actually taken which result from the shutdown of folding and laminated paperboard products converting facilities in an aggregate amount not to exceed $6,500,000, in each case for the Consolidated Companies determined on a consolidated basis in accordance with GAAP, (b) actual rental expense associated with any Synthetic Lease and (c) cash distributions of earnings of Unrestricted Subsidiaries made to a Consolidated Company to the extent previously excluded in the determination of Consolidated Net Income or Consolidated Net Loss by virtue of clause (i) of the respective definitions thereof. For purposes of determining EBITDA hereunder, there shall be included in such determination of EBITDA for any period the Acquired EBITDA of any Person, property, business or asset (other than an Unrestricted Subsidiary) acquired by a Consolidated Company pursuant to a Permitted Acquisition and not subsequently sold, transferred or otherwise disposed of by any Consolidated Company during such period based on the actual Acquired EBITDA of such Person, property, business or asset for such period (including the portion thereof occurring prior to such acquisition).

          (d) The Credit Agreement is hereby amended by deleting the definition of “EBITR” from Section 1.1 and substituting in lieu thereof the following new definition of “EBITR”:

“EBITR” shall mean for any fiscal period, Consolidated Net Income (or Consolidated Net Loss, as the case may be) for such period plus (a) the aggregate amount deducted in determining such Consolidated Net Income (Loss) in respect of (i) Interest Expense, (ii) Income Taxes of the Consolidated Companies determined in accordance with GAAP, (iii) 100% of lease expense (including any rental expense under any Synthetic Lease but excluding expenses incurred in respect of Capital Leases) of the Consolidated Companies determined in accordance with GAAP, in each case for the applicable fiscal period, (iv) any non-cash charges relating to plant shut-downs and asset impairment charges actually taken by the Consolidated Companies for the quarter ending March 31, 2000, (v) any non-cash charges actually taken by the Consolidated Companies after March 31, 2000 which are associated with the accelerated write-off of any tangible or intangible assets related to the acquisition of Waldorf Corporation provided such amounts do not exceed $100,000,000 in the aggregate through the Maturity Date, (vi) any non-cash charges actually taken which are associated with the accelerated write-off of any tangible or intangible assets provided such amounts do not exceed $50,000,000 in the aggregate through the Maturity Date, (vii) the amount of cash charges actually taken which resulted from the Home Office and Folding Carton Division reorganizations and the closing of the Borrower’s Downingtown, Pennsylvania converting facility, Norcross, Georgia folding facility, Lynchburg,

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Virginia converting facility, Augusta, Georgia folding facility, Madison, Wisconsin folding facility, and Chicago, Illinois folding facility in an aggregate amount not to exceed $4,832,000 for the fiscal quarter ending June 30, 2000, $5,637,000 for the fiscal quarter ending September 30, 2000, $1,906,000 for the fiscal quarter ending December 31, 2000 and an aggregate of $7,000,000 thereafter; in each case for the Consolidated Companies determined on a consolidated basis in accordance with GAAP, (viii) the amount of cash charges actually taken which resulted from the closing of the Borrower’s El Paso, Texas folding facility, Hunt Valley, Maryland display packout facility and the Vineland, New Jersey converting facility and the shutdown of the Borrower’s Dallas, Texas paperboard machine, all such cash charges in an aggregate amount not to exceed $2,500,000, in each case for the Consolidated Companies determined on a consolidated basis in accordance with GAAP, and (ix) the amount of cash charges actually taken which result from the shutdown of folding and laminated paperboard products converting facilities in an aggregate amount not to exceed $6,500,000, in each case for the Consolidated Companies determined on a consolidated basis in accordance with GAAP, and (b) cash distributions of earnings of Unrestricted Subsidiaries made to a Consolidated Company to the extent previously excluded in the determination of Consolidated Net Income or Consolidated Net Loss by virtue of clause (i) of the respective definitions thereof.

          (e) The Credit Agreement is hereby further amended by deleting Section 2.1(a) in its entirety and substituting in lieu thereof the following new Section 2.1(a):

(a) Subject to and upon the terms and conditions herein set forth, each Lender severally agrees to make to the Borrower from time to time on and after the Closing Date, but prior to the Maturity Date, Revolving Loans; provided that, immediately after each such Revolving Loan is made, (i) such Lender’s Revolving Credit Exposure does not exceed such Lender’s Revolving Credit Commitment and (ii) the sum of the aggregate Revolving Credit Exposures of all Lenders does not exceed the lesser of (y) the Revolving Credit Commitments of all Lenders or (z) 125,000,000.

          (f) The Credit Agreement is hereby amended by deleting Section 8.1(i) in its entirety and substituting in lieu thereof the following new Section 8.1(i):

(i) Fixed Charges.  Suffer or permit the ratio of (a) Consolidated EBITR to (b) Fixed Charges as of the last day of each fiscal quarter, as calculated for a period consisting of the four preceding fiscal quarters, to be less than 1.75:1.0.

          (g) The Credit Agreement is hereby amended by deleting Section 8.1(ii) in its entirety and substituting in lieu thereof the following new Section 8.1(ii):

(ii) Total Funded Debt to EBITDA. Permit the ratio of (a) Total Funded Debt to (b) EBITDA as of the last day of each fiscal quarter ending during the

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periods set forth below, as calculated for a period consisting of the four preceding fiscal quarters, to exceed the ratio set forth opposite such period:

Period	Ratio
Closing Date through September 30, 2004		4.00:1.0
October 1, 2004 through the Maturity Date		3.75:1.0

          (h) The Credit Agreement is hereby amended by deleting the last proviso to Section 8.12 therefrom so that after giving effect thereto Section 8.12 shall read as follows:

          Section 8.12. Restrictive Agreements.

     Neither the Borrower nor any Restricted Subsidiary shall, directly or indirectly, enter into, incur or permit to exist any agreement that prohibits, restricts or imposes any condition upon (a) the ability of the Borrower or any Restricted Subsidiary to create, incur or permit any Lien upon any of its assets or properties, whether now owned or hereafter acquired, or (b) the ability of any Restricted Subsidiary to pay dividends or other distributions with respect to its common stock, to make or repay loans or advances to the Borrower or any other Restricted Subsidiary, to Guaranty Indebtedness of the Borrower or any other Restricted Subsidiary or to transfer any of its property or assets to the Borrower or any Restricted Subsidiary; provided, that (i) the foregoing shall not apply to restrictions or conditions imposed by law or by this Agreement or any other Credit Document, (ii) the foregoing shall not apply to customary restrictions and conditions contained in agreements relating to the sale of a Restricted Subsidiary pending such sale, provided such restrictions and conditions apply only to the Restricted Subsidiary that is sold and such sale is permitted hereunder, (iii) clause (a) shall not apply to restrictions or conditions imposed by any agreement relating to Purchase Money Indebtedness permitted by this Agreement if such restrictions and conditions apply only to the property or assets securing such Indebtedness, (iv) clause (a) shall not apply to customary provisions in leases restricting the assignment thereof and (v) clause (a) shall not apply to restrictions or conditions imposed by that certain Indenture dated July 31, 1995 between Rock-Tenn Company and SunTrust Bank, N.A. (as successor trustee to Trust Company Bank).

          (i) The Credit Agreement is hereby amended by deleting Schedule 1.01(a) in its entirety and substituting in lieu thereof the new Schedule 1.01(a) attached hereto.

     Section 2.  Acknowledgement of Reduction of Revolving Credit Commitment.  The parties hereby acknowledge and agree that the Borrower reduced the Revolving Credit Commitment of all Lenders to $125,000,000 effective as of March 19, 2003, and that each

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Lender’s Revolving Credit Commitment as of such date has been reduced as set forth in Section 2.3 of the Credit Agreement.

     Section 3.  Benefits of Credit Documents.  Each reference to the Credit Agreement in any of the Credit Documents shall be deemed to be a reference to the Credit Agreement as amended by this Amendment, and as the Credit Agreement may from time to time be further amended, supplemented, restated or otherwise modified in the future by one or more other written amendments or supplemental or modification agreements entered into pursuant to the applicable provisions thereof.

     Section 4.  Conditions to Effectiveness of Amendment.  The effectiveness of this Amendment is subject to the following conditions precedent:

          (a) that each of the following be received by the Agent (unless otherwise waived in writing by the Agent), each of which shall be satisfactory in form and substance to the Agent:

               (1) this Amendment executed by the Borrower and by the Required Lenders;

               (2) the Acknowledgment and Consent of the Guarantors, substantially in the form of Exhibit A hereto, executed by each of the Guarantors (as defined below) (the “Acknowledgment”);

               (3) payment by the Borrower to the Agent of any expenses incurred by the Agent which are due and payable; and

               (4) such other approvals, opinions or documents as the Agent may reasonably request; and

          (b) no Default or Event of Default shall then be in existence.

     Section 5.  Representations.  The Borrower represents to the Lenders that:

          (a) The Borrower has the right and power, and has taken all necessary action to authorize it, to execute and deliver this Amendment, and to perform this Amendment, and the Credit Agreement, as amended by this Amendment, in accordance with their respective terms. This Amendment has been duly executed and delivered by the duly authorized officers of the Borrower, and each of this Amendment, the Credit Agreement, as amended by this Amendment, and the other Credit Documents to which the Borrower is a party is a legal, valid and binding obligation of the Borrower enforceable against the Borrower in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity.

          (b) The execution and delivery of this Amendment, and the performance by the Borrower of this Amendment, and the Credit Agreement, as amended by this Amendment, in accordance with their respective terms, do not and will not, by the passage of time or the giving

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of notice, or otherwise: (i) violate any Requirement of Law relating to the Borrower; (ii) conflict with, result in a breach of or constitute a default under the charter or by-laws of the Borrower or any of its Material Contractual Obligations; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by the Borrower other than those permitted by the Credit Agreement.

          (c) The articles of incorporation and bylaws of the Borrower have not changed since delivery of such articles of incorporation and bylaws to the Lenders in connection with the consummation of the Credit Agreement.

     Section 6.  Reaffirmation.  The Borrower hereby repeats and reaffirms all representations and warranties made by the Borrower in the Credit Agreement and the other Credit Documents to which it is a party as of the date hereof with the same force and effect as if such representations and warranties were set forth in this Amendment in full except to the extent such representations expressly relate to an earlier date or have been updated to the extent permitted by the Credit Agreement.

     Section 7.  Reaffirmation and Representations by Guarantors.  By execution of the Acknowledgment, each Subsidiary that has executed a Subsidiary Guarantee (a “Guarantor”):

          (a) reaffirms its continuing obligations to the Agent and the Lenders under the Subsidiary Guarantee to which it is a party and agrees that the transactions contemplated by this Amendment shall not in any way affect the validity and enforceability of such Subsidiary Guarantee or reduce, impair or discharge the obligations of such Guarantor thereunder; and

          (b) represents to the Lenders that:

               (1) Such Guarantor has the right and power, and has taken all necessary action to authorize it, to execute and deliver this Acknowledgement, and to perform this Acknowledgement in accordance with its terms. This Acknowledgement has been duly executed and delivered by the duly authorized officers of such Guarantor, and the Acknowledgement is a legal, valid and binding obligation of such Guarantor enforceable against such Guarantor in accordance with its terms, except as may be limited by applicable bankruptcy, insolvency, reorganization, moratorium, or similar laws affecting the enforcement of creditors’ rights generally and by general principles of equity; and

               (2) the execution and delivery of this Acknowledgement, and the performance by such Guarantor of this Acknowledgement, do not and will not, by the passage of time or the giving of notice, or otherwise: (i) violate any Requirement of Law relating to such Guarantor; (ii) conflict with, result in a breach of or constitute a default under the charter or by-laws of such Guarantor, or any of its Material Contractual Obligations; or (iii) result in or require the creation or imposition of any Lien upon or with respect to any property now owned or hereafter acquired by such Guarantor other than those permitted by the Credit Agreement.

     Section 8.  Benefits.  This Amendment shall be binding upon and shall inure to the benefit of the parties hereto and their respective successors and assigns.

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     Section 9. GOVERNING LAW. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF GEORGIA.

     Section 10. Effect. Except as expressly herein amended, the terms and conditions of the Credit Agreement shall remain in full force and effect.

     Section 11. Counterparts. This Amendment may be executed in any number of counterparts, each of which shall be deemed to be an original and shall be binding upon all parties.

[Signatures on Following Page]

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     IN WITNESS WHEREOF, the parties have caused this Third Amendment to Credit Agreement to be executed by their authorized officers all as of the day and year first above written.

	ROCK-TENN COMPANY
(CORPORATE SEAL)	By:	/s/ Wade D. Hampe
		Title: Treasurer

Attest:

By:  /s/ Robert B. McIntosh
Title: Secretary

[Signatures Continued on Next Page]

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[Signature Page to Third Amendment to Credit Agreement]

SUNTRUST BANK, as Agent, Swing Line Lender and a Lender
By:	/s/ Daniel S. Komitor
	Title: Director

WACHOVIA BANK, N.A., as a Lender and Documentation Agent
By:	/s/ Shawn Janko
	Title: Vice President

BANK OF AMERICA, N.A., as a Lender and Syndication Agent
By:	/s/ Kevin F. Sullivan
	Title: Managing Director

JP MORGAN CHASE BANK FORMERLY KNOWN AS THE CHASE MANHATTAN BANK, as a Lender
By:	/s/ Peter S. Predun
	Title: Vice President

THE BANK OF TOKYO-MITSUBISHI, LTD., as a Lender
By:	/s/ Spencer Hughes
	Title: Authorized Signatory

THE BANK OF NEW YORK, as a Lender
By:	/s/ David C. Siegel
	Title: Vice President

[Signatures Continued on Next Page]

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[Signature Page to Third Amendment to Credit Agreement]

FIRST UNION NATIONAL BANK, as a Lender
By:	/s/ Shawn Janko
	Title: Vice President

THE MIZUHO CORPORATE BANK, LTD. as a Lender
By:	/s/ Gregg Botshon
	Title: Vice President

BNP PARIBAS, as a Lender
By:
	Title:
By:
	Title:

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EXHIBIT A
 
ACKNOWLEDGMENT AND CONSENT OF SUBSIDIARY GUARANTORS

     Each of the undersigned Subsidiaries hereby (i) acknowledges receipt of the foregoing Third Amendment to Credit Agreement by and among Rock-Tenn Company, the Lenders under the Credit Agreement (the “Lenders”), SunTrust Bank, in its capacity as Agent for the Lenders (the “Agent”), Bank of America, N.A., as Syndication Agent, and Wachovia Bank, N.A., as Documentation Agent (the “Amendment”), (ii) consents to the Amendment, (iii) agrees and acknowledges to the terms thereof including, without limitation, the representations and agreements of the each of the undersigned set forth in Section 7 of the Amendment, and (iv) restates and affirms its respective obligations under its Subsidiary Guarantee previously executed and delivered in favor of the Agent (for the ratable benefit of the Lenders) without defense, counterclaim or set-off.

     IN WITNESS WHEREOF, each of the undersigned Subsidiaries has executed this Acknowledgment and Consent of Subsidiary Guarantors this      day of March, 2003.

ROCK-TENN COMPANY, MILL DIVISION, INC., a Tennessee corporation ROCK-TENN COMPANY OF TEXAS, a Georgia corporation ROCK-TENN COMPANY OF ARKANSAS, a Georgia corporation ROCK-TENN COMPANY OF CALIFORNIA, INC., a Delaware corporation ROCK-TENN COMPANY OF ILLINOIS, INC., an Illinois corporation ROCK-TENN CONVERTING COMPANY, a Georgia corporation CONCORD INDUSTRIES, INC., an Illinois corporation WABASH CORPORATION, a Delaware corporation WALDORF CORPORATION, a Delaware corporation BEST RECYCLING, INC., an Iowa corporation WALDORF REALTY, INC., a Delaware corporation ROCK-TENN PARTITION COMPANY, a Georgia corporation WALDORF CORPORATION OF MINNESOTA, a Delaware corporation
By:
	Name:
	Title:

Schedule 1.01(a)
 
APPLICABLE MARGIN AND FACILITY FEE PERCENTAGE

Pricing	Total Funded Debt		Facility Fee
Level	to EBITDA Ratio	Applicable Margin	Percentage
I	Less than 1.50:1.00	.625% p.a.	.125% p.a.
II	Less than 2.00:1.00 but greater than or equal to 1.50:1.00	.750% p.a.	.125% p.a.
III	Less than 2.50:1.00 but greater than or equal to 2.00:1.00	.850% p.a.	.15% p.a.
IV	Less than 3.00:1.00 but greater than or equal to 2.50:1.0	1.05% p.a.	.20% p.a.
V	Less than 3.50:1.00 but greater than or equal to 3.00:1.00	1.125% p.a.	.25% p.a.
VI	Less than 3.75:1.00 but greater than or equal to 3.50:1.00	1.375% p.a.	.375% p.a.
VII	Greater than or equal to 3.75:1.00	1.50% p.a.	.50% p.a.

ACKNOWLEDGMENT AND CONSENT OF SUBSIDIARY GUARANTORS

     Each of the undersigned Subsidiaries hereby (i) acknowledges receipt of the foregoing Third Amendment to Credit Agreement by and among Rock-Tenn Company, the Lenders under the Credit Agreement (the “Lenders”), SunTrust Bank, in its capacity as Agent for the Lenders (the “Agent”), Bank of America, N.A., as Syndication Agent, and Wachovia Bank, N.A., as Documentation Agent (the “Amendment”), (ii) consents to the Amendment, (iii) agrees and acknowledges to the terms thereof including, without limitation, the representations and agreements of the each of the undersigned set forth in Section 7 of the Amendment, and (iv) restates and affirms its respective obligations under its Subsidiary Guarantee previously executed and delivered in favor of the Agent (for the ratable benefit of the Lenders) without defense, counterclaim or set-off.

     IN WITNESS WHEREOF, each of the undersigned Subsidiaries has executed this Acknowledgment and Consent of Subsidiary Guarantors this 31st day of March, 2003.

ROCK-TENN COMPANY, MILL DIVISION, INC., a Tennessee corporation ROCK-TENN COMPANY OF TEXAS, a Georgia corporation ROCK-TENN COMPANY OF ARKANSAS, a Georgia corporation ROCK-TENN COMPANY OF CALIFORNIA, INC., a Delaware corporation ROCK-TENN COMPANY OF ILLINOIS, INC., an Illinois corporation ROCK-TENN CONVERTING COMPANY, a Georgia corporation CONCORD INDUSTRIES, INC., an Illinois corporation WABASH CORPORATION, a Delaware corporation WALDORF CORPORATION, a Delaware corporation BEST RECYCLING, INC., an Iowa corporation WALDORF REALTY, INC., a Delaware corporation ROCK-TENN PARTITION COMPANY, a Georgia corporation WALDORF CORPORATION OF MINNESOTA, a Delaware corporation
By:	/s/ Wade D. Hampe
	Name: Wade D. Hampe Title: Treasurer

EX-99.3 5 g81980exv99w3.htm EX-99.3 TEXT OF PRESS RELEASE

EXHIBIT 99.3

Rock-Tenn Company Affirms Second Fiscal Quarter 2003 Earnings Guidance

NORCROSS, Ga., April 8, 2003- Rock-Tenn Company (NYSE: RKT) Chairman and Chief Executive Officer James A. Rubright today affirmed the Company’s guidance of $0.16 to $0.20 per share for the second fiscal quarter of 2003. Rubright also stated that Rock-Tenn Company’s debt balance, excluding the fair value hedge adjustment, at the end of the quarter was $496 million compared to $453 million on September 30, 2002. The increase of $43 million represents a paydown of over $20 million of debt after accounting for the acquisition of Cartem-Wilco Group at a cost of approximately $66 million. Rubright also commented that, during the first half of fiscal year 2003, Rock-Tenn’s capital expenditures were approximately $31 million, in line with its previous estimate of $60 million to $65 million in capital expenditures for fiscal year 2003.

Statements herein regarding the expected earnings, debt levels and capital expenditures of the Company constitute forward-looking statements within the meaning of the Securities Act of 1933 and the Securities Exchange Act of 1934. Such statements are based on the Company’s expected financial results, which are subject to risks and uncertainties that could cause actual amounts to differ materially from those projected.

Rock-Tenn Company is one of North America’s leading marketing and packaging solutions companies, with annual net sales of over $1.4 billion and over 75 manufacturing operations in the United States, Canada, Mexico and Chile.

EX-99.4 6 g81980exv99w4.htm EX-99.4 SLIDE PRESENTATION

2003 SunTrust Robinson Humphrey Institutional Investor Conference April 8, 2003 Exhibit 99.4

Statements herein that are not historical facts are forward- looking statements. Forward-looking statements are based on our current expectations and beliefs and involve risks, uncertainties and assumptions. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statement. Such factors are more particularly described in our filings with the Securities and Exchange Commission, see "Forward-looking Information and Risk Factors" in our Annual Report on Form 10-K for the most recently ended fiscal year. We believe that our forward-looking statements are reasonable; however, undue reliance should not be placed on any forward-looking statements. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Safe Harbor Statement

Outperforming peers in a very competitive market Customer and product diversity provides stability in turbulent markets Continued cash flow available for growth and debt reduction Rock-Tenn Company

Packaging Products Business Segments At-A-Glance Merchandising Displays And Corrugated Packaging Paperboard Segment Sales: $ 790.2 Million Segment Income: $ 50.5 Million Return On Sales: 6.4% Segment Sales: $ 290.1 Million Segment Income: $ 32.8 Million Return On Sales: 11.3% Segment Sales: $ 516.1 Million Segment Income: $ 24.1 Million Return On Sales: 4.7%

Packaging and Display Segments Increase Contribution From 57% to 78% of Operating Income 2000 Packaging Products Paperboard Specialty Corrugated Packaging & Display FY98 34 43 23 Packaging Products Paperboard Specialty Corrugated Packaging & Display 47 22 31 2002 $39.7 Million, 34% $27.6 Million, 23% $51.4 Million, 43% $50.5 Million, 47% $32.8 Million, 31% $24.1 Million, 22% Packaging Products Paperboard Merchandising Displays and Corrugated Packaging Total Operating Income: $ 107.4 Million Total Operating Income: $ 118.7 Million Operating Income By Segment

.. Rock-Tenn Strategy Packaging Products Bring Low Cost Solutions To Demanding Requirements Invest In Cost Reducing Technologies Consolidate Operations To Plants With Best Cost Structures Merchandising Display & Corrugated Packaging Continued Expansion Of Merchandising Display Platform Continued Commitment To Being Service Leader Streamline Processes Of Merchandising Display Business Paperboard Product Differentiation Operate At High Production Rates

.. Rock-Tenn Capital Expenditures Segment Capex 2000-2002 Results Packaging Products $116.5 Million Converted folding carton plants to CTP technology Added high-speed printing, cutting and finishing equipment to folding carton plants Added new thermo-forming and extrusion equipment to plastic packaging plants Merchandising Displays and Corrugated Packaging $36.3 Million Expanded display manufacturing capacity Opened new manufacturing, contract packing and design facilities to meet increased demand Paperboard $81.4 Million Rebuilt and converted machines to target more attractive markets Added latest generation computer control systems Upgraded fiber cleaning systems

Capital Expenditures 1998 - 2003E 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr East 20.4 27.4 90 20.4 West 30.6 38.6 34.6 31.6 North 45.9 46.9 45 43.9 1st Qtr 2nd Qtr 3rd Qtr 4th Qtr East 20.4 27.4 90 20.4 West 30.6 38.6 34.6 31.6 North 45.9 46.9 45 43.9 Depreciation and Amortization Cash Provided By Operating Activities

Packaging Products Segment Folding Carton- Fifth-largest manufacturer of folding cartons in North America RTS Packaging- Largest producer of solid fiber interior packaging in North America Plastic Packaging- Supplies 40% of the rigid barrier plastic trays for the case-ready market

Top 10 Customers = 32% of Total Sales Top 25 Customers = 49% of Total Sales '99 '00 '01 '02 Sales 565.3 597.4 602.7 598.5 Sales ($ Millions) Folding Carton Customer Profile

.. Folding Carton Competitive Strengths Commitment to the Industry State of the art facilities covering broad geography, broad customer base Excel With Demanding Printing or Finishing Requirement Products Overnight letters, metal edge packaging, multi-pack packaging Solutions Provider Digital workflow leadership, computer-to-plate technology, MillMask(r) systems paperboard Culture of Service Custom business solutions, technical support team, graphic and structural design, ExtraNet communications, vendor managed inventory systems Quality Six Sigma methodology, ISO certification Building for the Future Capital investment exceeds industry norms, expanding product offerings, growth through acquisition

Customer Profile Food Products 0.52 Paper Goods 0.16 Hardware Products 0.1 Other 0.09 Retail Boxes 0.03 Medical Products 0.03 Leisure Products 0.02 Soap 0.02 Cosmetic Products 0.02 Textiles 0.01 Folding Carton Customer Profile Recent Cartem Wilco acquisition gives Rock-Tenn expanded presence in health and beauty, pharmaceuticals and hair care markets.

Merchandising Displays and Corrugated Packaging Segment Alliance- Largest manufacturer of temporary point-of-purchase displays in North America Corrugated Packaging- Leading producer in the Southeast

Concept to Consumer(r) strategy has proven highly successful as consumer products companies continue to seek more service from fewer vendors Growth accelerates by adding new major customers, new products and new services A total POP market of $15+B. Alliance is the market leader in the $2.5B in-store promotional display sector Promotional spending on temporary point of purchase displays increasing in importance 110 million Wal-Mart Shoppers every week Traditional advertising becoming unnoticed "noise" Consumer products companies are looking for "Full Service" vendors to take on more services to reduce costs '98 '99 '00 '01 '02 Sales 72 112 153 181 219 Sales Growth CAGR=32% Alliance: Concept to Consumer(r)

.. Rock-Tenn Acquisitions Rock-Tenn has made $26 million of strategic bolt-on acquisitions in the display businesses. Acquisition Acquisition Result 11/30/01 Advertising Display Co. Transferred business acquired from ADC to existing merchandising display facilities. 3/21/02 Athena Industries, Inc. Expanded merchandising display expertise into wire and metal fabrication fixtures. 8/12/02 Turnedge Expanded merchandising display expertise into high-end DVD packaging.

Paperboard Segment Recycled Paperboard Third Largest Producer of Recycled Boxboard (excluding linerboard and corrugating medium) Coated Mill Capacity: 554,000 tons Specialty Paperboard Capacity: 443,500 tons Buys and sells over 1.5 million tons of recycled fiber per year.

Annual Capacity Changes: Recycled Folding 2002 -0.015 2003 -0.028 2004 0.003 2005 0.002 2003-5 Average Projected -0.008 1990's Average Historic 0.017 2002 Recycled Folding Year End Capacity: 2.9 million tons Source: AF&PA

.. Paperboard Strengths Latest Generation Technology In Mills Quality Control Systems Fiber Cleaning Systems Flexibility To Change Fiber Mix At Mills Product Differentiation Introduction of Millennium Board(r) SUS Replacement Introduction of MillMask (r) Grease Masking Paperboard Technology Rebuilt Lynchburg No. 2 Machine To Produce Gypsum Linerboard for LaFarge Joint Venture

Value-Added Packaging Businesses With Strong Competitive Position Folding Carton: Provide low full process cost solutions to complex and demanding requirements Alliance Display: Service leader in merchandising display market RTS Packaging: World's best equipment and unparalleled service Continuing Productivity Improvements in Both Manufacturing and Administration Continuing Strong Cash Generation Seeking Opportunities to Grow Expect continued growth in merchandising displays business Expect to capitalize on product innovation in plastics Target acquisitions in pharmaceutical and health and beauty care packaging Manage and Compensate To Return Over Capital Costs Maximizing Long-Term Shareholder Value .. Rock-Tenn Company Summary

.. First Quarter Financial Results

.. Second Quarter 2003 2Q03 Guidance: $0.16-$0.20 per diluted share Debt Balance $496 Million At End of 2Q03 vs. $453 Million on September 30, 2002. Paydown over $20 million after acquisition of Cartem-Wilco Group at cost of approximately $66 million. Capital Expenditures Year-To- Date: $31 Million Estimated In line with Company's previous estimate of $60-65 million for FY03.

ROIC vs. Folding Carton Peers 2000 2001 2002 RKT 0.7 5.9 5 Peer 1 7 4.8 3.9 Peer 2 3.8 3.8 -19.4 Peer 3 3.9 1.4 1.7 Peer 4 -0.6 3.3 4.2 ROIC= (Net Income + Interest After Tax)/(Current Maturities of Debt+Long-term Debt+Total Shareholders' Equity). Includes plant closing costs of $65.6 million, $16.9 million and $18.2 million in fiscal 2000, 2001 and 2002, respectively. As of 9/30/02. The Company does not believe that there is a GAAP measure that is directly comparable to ROIC. With the exception of Interest After Tax, all of the elements included in the calculation of ROIC are numbers calculated in accordance with GAAP. If the Company had calculated its ROIC using the pre-tax interest amount from the corresponding income statement, the ROIC would have been 2.1%, 7.4% and 6.2% in fiscal 2000, 2001 and 2002, respectively.

Outperforming peers in a very competitive market Customer and product diversity provides stability in turbulent markets Continued cash flow available for growth and debt reduction Rock-Tenn Company

2003 SunTrust Robinson Humphrey Institutional Investor Conference April 8, 2003

EX-99.1

EX-99.1 TEXT OF PRESS RELEASE

EX-99.2

EX-99.2 THIRD AMENDMENT TO CREDIT AGREEMENT

EX-99.3

EX-99.3 TEXT OF PRESS RELEASE

EX-99.4

EX-99.4 SLIDE PRESENTATION

EX-99.5

ROIC vs. Folding Carton Peers 2000 2001 2002 RKT 2.1 7.4 6.2 Peer 1 9.5 7.1 5.6 Peer 2 6.5 5.8 -17.3 Peer 3 5.7 3.4 3.5 Peer 4 0.4 4.5 5.8 ROIC= (Net Income + Interest Before Tax)/(Current Maturities of Debt+Long-term Debt+Total Shareholders' Equity). Includes plant closing costs of $65.6 million, $16.9 million and $18.2 million in fiscal 2000, 2001 and 2002, respectively. As of 9/30/02. When the Company calculated ROIC using interest before tax, the ROIC was 0.7%, 5.9% and 5.0% in fiscal 2000, 2001 and 2002, respectively. If the Company had calculated its ROIC using the pre-tax interest amount from the corresponding income statement, the ROIC would have been 2.1%, 7.4% and 6.2% in fiscal 2000, 2001 and 2002, respectively. Exhibit 99.5