Summary
United Rentals, Inc. (URI) has filed an 8-K report detailing a significant amendment to its receivables financing facility. The amendment extends the facility's expiration date to August 30, 2016, with the potential for further 364-day extensions. Importantly, the total commitment under the facility has been increased from $550 million to $625 million, providing the company with enhanced liquidity and financial flexibility. This amendment also introduces Bank of Montreal (BMO) as a new participant, taking on certain rights and obligations previously held by The Bank of Nova Scotia. The agreement reinforces the structure where advances are secured by eligible receivables, with collections serving as the sole source of repayment. The ability to designate certain obligors as 'excluded' offers additional flexibility in managing the collateral pool. Investors should note that these advances are reflected as debt on the company's balance sheet.
Key Highlights
- 1Extended the receivables financing facility's expiration date to August 30, 2016, with potential for further 364-day extensions.
- 2Increased the aggregate commitments under the facility from $550 million to $625 million, enhancing liquidity.
- 3Added Bank of Montreal (BMO) as a new participant, sharing duties with The Bank of Nova Scotia.
- 4The amendment allows for the designation of certain obligors as 'excluded', impacting the collateral pool.
- 5The structure maintains that receivables in the collateral pool are the lenders' only source of repayment.
- 6Advances under the facility will continue to be reflected as debt on the company's balance sheets.
- 7The company announced participation in the RBC Capital Markets 2015 Global Industrials Conference on September 9, 2015.