8-KMaterial AgreementsFinancial EventsExhibits & Filings

REPUBLIC SERVICES, INC. 8-K Report, Material Agreement (Nov 25, 2009)

Filed November 25, 2009For Securities:RSG

Summary

Republic Services, Inc. (RSG) has filed an 8-K report detailing the completion of a $600 million Senior Notes issuance due in 2021. The primary purpose of this debt offering is to refinance existing debt, specifically calling approximately $450 million of its 7.875% Senior Notes due 2013 and a portion ($145.6 million) of its 4.250% Senior Subordinated Convertible Debentures due 2034. This move is aimed at optimizing the company's capital structure and potentially lowering its overall interest expense. The issuance was conducted as a private placement to qualified institutional buyers under Rule 144A and to non-U.S. persons under Regulation S, indicating that these notes are not freely tradable without registration. The company has entered into a Registration Rights Agreement to facilitate the exchange of these restricted notes for freely tradable registered notes, or in certain circumstances, to file a shelf registration statement for resales. Failure to complete the exchange offer within a specified timeframe may result in additional interest payments.

Key Highlights

  • 1Republic Services, Inc. successfully issued $600 million in Senior Notes due 2021.
  • 2Net proceeds of approximately $595.6 million will be used to refinance existing debt.
  • 3The issuance aims to call $450 million of 7.875% Senior Notes due 2013.
  • 4Approximately $145.6 million will be used to finance the call of 4.250% Senior Subordinated Convertible Debentures due 2034.
  • 5The notes were issued through a private offering to qualified institutional buyers and non-U.S. persons.
  • 6A Registration Rights Agreement is in place to register the notes for public resale or exchange.
  • 7The indenture includes covenants related to liens, sale and leaseback transactions, and change of control provisions.

Frequently Asked Questions

The primary purpose is to refinance existing debt. Specifically, Republic Services plans to use the proceeds to call back its 7.875% Senior Notes due 2013 and a portion of its 4.250% Senior Subordinated Convertible Debentures due 2034. This is a strategic move to optimize the company's debt structure.

No, the notes were issued in a private placement under Rule 144A and Regulation S, making them restricted securities. Republic Services has entered into a Registration Rights Agreement to work towards registering these notes for public resale through an exchange offer or a shelf registration statement.

This refinancing could lead to a lower overall interest expense for the company if the new notes have a lower coupon rate than the debt being refinanced. It also extends the maturity profile of some of the company's debt obligations. The company also has the option to redeem the notes early under certain conditions, which offers financial flexibility.

If Republic Services is unable to complete the exchange offer within 365 days of the issuance date, or in certain other limited circumstances where a shelf registration is required, the company agreed to pay additional interest on the notes. This provision incentivizes the company to ensure the notes become freely tradable.