Item 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.
Amended and Restated Credit Agreement
On August 17, 2021, Republic Services, Inc. (the "Company") entered into an
Amended and Restated Credit Agreement, with Bank of America, N.A., as
Administrative Agent, Swing Line Lender and L/C Issuer (the "Administrative
Agent") and the other lenders party thereto (the "Credit Agreement"). The Credit
Agreement amends and restates the Company's prior Credit Agreement, dated as of
June 8, 2018, with Bank of America, N.A., as Administrative Agent, Swing Line
Lender and L/C Issuer and the other lenders party thereto, as amended.
The Credit Agreement is unsecured and will mature in August 2026. Under the
Credit Agreement, each lender agrees to make loans to the Company in an
aggregate amount not to exceed the amount of such lender's commitment set forth
in the Credit Agreement with the total outstanding principal amount under the
Credit Agreement not to exceed the current aggregate lenders' commitments of
$3.0 billion, as such amounts may be adjusted from time to time in accordance
with the Credit Agreement. The Company may request two one-year extensions of
the maturity date, but none of the lenders are committed to participate in such
extensions. The Credit Agreement includes a feature that allows the Company to
increase availability under the facility, at the Company's option, by an
aggregate amount of up to $1.0 billion, through increased commitments from
existing lenders or the addition of new lenders, subject to obtaining additional
commitments and other customary conditions.
At the Company's option, and subject to customary conditions, borrowings bear
interest at a base rate, a daily floating London Interbank Offered Rate
("LIBOR") rate or a Eurodollar rate, plus an applicable margin based on the
Company's debt ratings. On the earliest of (i) the date that all available
tenors of U.S. dollar LIBOR have permanently or indefinitely ceased to be
provided or have been announced to be no longer representative, (ii) June 30,
2023 or (iii) the effective date of an election to opt into a secured overnight
financing rate ("SOFR"), the LIBOR rate will be replaced by a forward-looking
term rate based on SOFR or a daily rate based on SOFR published on such date.
After the effective date of the Credit Agreement, the Company, in consultation
with one or more lenders selected by the Company to be the sustainability
coordinator under the Credit Agreement (the "Sustainability Coordinator"), will
be entitled to establish specified key performance indicators ("KPIs") with
respect to certain environmental, social and governance targets of the Company
and its subsidiaries. The Sustainability Coordinator, the Company and the
Administrative Agent may amend the Credit Agreement, unless such amendment is
objected to by lenders holding more than 50% of the commitments under the Credit
Agreement, solely for the purpose of incorporating the KPIs so that certain
adjustments to the otherwise applicable facility fee or interest rate may be
made based on the Company's performance against the KPIs.
Available amounts subject to outstanding letters of credit, and outstanding
principal, accrued and unpaid interest and other amounts payable under the
facility, may be accelerated upon the occurrence of customary events of default,
including (subject to certain materiality thresholds and grace periods) payment
defaults, failures to comply with covenants, material inaccuracies of
representations or warranties, bankruptcy or insolvency proceedings, changes of
control, ERISA matters and cross-defaults to other debt agreements.
The Credit Agreement contains customary affirmative and negative covenants,
including, among other things, a covenant requiring the Company not to exceed a
maximum ratio of total debt to EBITDA, as defined in the Credit Agreement. The
Company may pay dividends and repurchase common stock if it is in compliance
with these covenants.
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The foregoing description of the Credit Agreement does not purport to be
complete, and is qualified in its entirety by reference to the full text of the
Credit Agreement, which is attached hereto as Exhibit 4.1 and is incorporated
herein by reference. The Credit Agreement is not intended to be a source of
factual, business or operational information about the Company or its
subsidiaries. The representations and warranties contained in the Credit
Agreement were made only for purposes of such agreement and as of specific
dates, were solely for the benefit of the parties to such agreement, and may be
subject to limitations agreed upon by the parties, including being qualified by
disclosures for the purpose of allocating contractual risk between the parties
instead of establishing matters as facts; and may be subject to standards of
materiality applicable to the contracting parties that differ from those
applicable to investors or security holders. Accordingly, investors should not
rely on the representations, warranties and covenants or any descriptions
thereof as characterizations of the actual state of facts or condition of the
Item 1.02 TERMINATION OF A MATERIAL DEFINITIVE AGREEMENT.
On August 17, 2021, and in connection with the execution and delivery of the
Credit Agreement described in Item 1.01 above, the Company terminated its
$1.0 billion 364-day revolving credit facility pursuant to a Credit Agreement
with Bank of America, N.A., as Administrative Agent, and the other lenders party
thereto (the "364-Day Facility"). As of August 17, 2021, there was no
indebtedness or fees outstanding under the 364-Day Facility. The disclosure
provided in Item 1.01 above is incorporated herein by reference.
Item 2.03 CREATION OF A DIRECT FINANCIAL OBLIGATION OR AN OBLIGATION UNDER AN
OFF-BALANCE SHEET ARRANGEMENT OF A REGISTRANT.
The disclosure required hereunder is provided under Item 1.01 above relating to
the entry into the Credit Agreement and is incorporated by reference herein.
Item 9.01 FINANCIAL STATEMENTS AND EXHIBITS.
4.1 Amended and Restated Credit Agreement, dated as of August 17, 2021,
by and among Republic Services, Inc., as Borrower, Bank of America,
N.A., as Administrative Agent, Swing Line Lender and L/C Issuer, and
the other lenders party thereto.
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