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Casella enters $550 million credit agreement at Libor plus 200 bps
By Wendy Van Sickle
Columbus, Ohio, May 15 – Casella Waste Systems Inc. entered into a new five-year credit agreement on Monday that provides for a $350 million term loan and a $200 million revolving credit facility, according to an 8-K filing with the Securities and Exchange Commission.
The revolver has a $60 million sublimit for letters of credit, and the credit agreement allows for additional loans up to the greater of $125 million or an additional amount provided that a consolidated secured net leverage ratio test is satisfied.
Borrowings bear interest at Libor plus a margin of 200 basis points initially. The margin is subject to range from 125 bps to 225 bps, based on the consolidated net leverage ratio.
The revolver’s commitment fee is initially 40 bps and can range from 30 bps to 50 bps, also based on the consolidated net leverage ratio.
The term loan amortizes quarterly at 0.25% of the initial principal amount through Dec. 31, 2021 and at 0.625% of the initial principal amount per quarter onwards. The balance is due on the maturity date of May 14, 2023.
Bank of America Merrill Lynch, Citizens Bank, NA, JPMorgan Chase Bank, NA and Comerica Bank are the joint lead arrangers and joint bookrunners.
Bank of America, NA is the administrative agent.
Proceeds may be used to refinance existing debt and for working capital and general corporate purposes.
The borrower must comply with a minimum consolidated EBITDA to consolidated cash interest charges ratio and a maximum funded debt to consolidated EBITDA ratio.
In connection with the closing of the new credit agreement, the company repaid and terminated its previous credit agreement with Bank of America as administrative agent.
Casella is a Rutland, Vt.-based solid waste, recycling and resource management services company.
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