Waste Management restates loan for $2.25 billion commitments due 2018

By Marisa Wong

Madison, Wis., July 30 - Waste Management, Inc. amended and restated its revolving credit agreement to increase total commitments to $2.25 billion from $2 billion and extend the maturity date to July 26, 2018, according to an 8-K filed Tuesday with the Securities and Exchange Commission.

Waste Management restated its credit agreement on July 26 with Bank of America, NA as administrative agent; JPMorgan Chase Bank, NA and Barclays Bank plc as syndication agents; BNP Paribas, Citibank, NA, Deutsche Bank AG New York Branch, Bank of Tokyo-Mitsubishi UFJ, Ltd., Royal Bank of Scotland plc, U.S. Bank NA and Wells Fargo Bank, NA as co-documentation agents; and J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Inc. and Barclays Bank plc as lead arrangers and joint bookrunners.

Under the second amended and restated credit agreement, interest is equal to Libor plus a spread of 90 basis points to 147.5 bps. The spread is based on the company's senior public debt rating.

In addition, the company is required to pay a quarterly facility fee at an annualized rate of 10 bps to 27.5 bps and letter-of-credit fees of 90 basis points to 147.5 bps.

Based on the company's current rating, the interest rate is Libor plus 107.5 bps, the facility fee is 17.5 bps, and the letter-of-credit fee is 107.5 bps.

The credit agreement requires the company to maintain a minimum interest coverage ratio and a maximum total debt to consolidated EBITDA ratio. Specifically, the ratio of consolidated EBIT for the preceding four fiscal quarters to consolidated total interest expense for the current period is not to be less than 2.75 to 1. The ratio of total debt to EBITDA for the preceding four fiscal quarters is not to be more than 3.75 to 1 for each fiscal quarter ending before Sept. 30, 2015 and 3.5 to 1 for each fiscal quarter ending on or after Sept. 30, 2015.

At closing, Waste Management had $255 million of eurodollar loans and $951 million of letters of credit outstanding and unused and available credit of $1.04 billion.

The waste services company is based in Houston.

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