Glatfelter in talks with loan lenders on possible maximum leverage ratio violation

By Sara Rosenberg

New York, May 9 - P.H. Glatfelter Co. is in discussions with its bank group about the potential violation of the maximum leverage ratio at the end of the second quarter, according to a 10-Q filed with the Securities and Exchange Commission Wednesday.

Currently, the maximum leverage ratio reduces to 3.5 times from 3.75 times at June 30, and, as a result of a $6 million charge related to the Fox River remediation and operating expectations, the company feels like it may near the covenant limit.

The company's 7½% notes contain a cross default provision that, in the event of a default under the credit facility, the notes would become currently due.

Glatfelter is a York, Pa.-based manufacturer of specialty papers and engineered products.

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