Conifex Timber Inc. has amended and restated its existing credit agreement with PenderFund Capital Management Ltd. ("Pender").

The restated agreement increases the aggregate principal amount of the secured term loan provided thereunder to up to $41 million, of which $5 million is available immediately, and the remaining $11 million is subject to completion of financial diligence. The loan continues to have a term of 5 years from original issuance and is substantially on the same terms, including the same annual interest rate. The loan was advanced in lieu of Conifex's consideration of a working capital facility to fund ongoing working capital requirements.

"The additional borrowings will be used to fund a build-up in sawlog inventories to support our transition to a two-shift operation at our sawmill complex, effective January 6, 2025," commented Conifex's Chairman and CEO, Ken Shields.

The decision to move to a two-shift operation was based on a steadily improving backdrop for lumber prices, as evidenced by the 18% improvement in cash prices for Spruce Pine Fir benchmark lumber prices in the Q4 2024 relative to those in the Q3 2024.

Mr. Shields continued: "The benefits of spreading our fixed costs over a larger base coupled with additional product sales are expected to lower our cash costs and boost the operating cash flow we expect to achieve in the Q1 2025 from what we presently achieve on a one-shift basis."

Conifex and its subsidiaries' primary business currently includes timber harvesting, reforestation, forest management, sawmilling logs into lumber and wood chips, and value added lumber finishing and distribution.