Interstate Waste finalizes $575 million of term loans at 98.5 OID

By Sara Rosenberg

New York, Oct. 5 – Interstate Waste Services Inc. (Action Environmental Group Inc.) set the original issue discount on its $500 million seven-year first-lien term loan B (B2/B) and $75 million delayed-draw first-lien term loan B (B2/B) at 98.5, the tight end of the 98 to 98.5 talk, according to a market source.

Also, the company revised the delayed-draw term loan ticking fee to half the spread for days 46 to 90 and the full spread thereafter, from half the spread for days 61 to 120 and the full spread thereafter, maximum draws were changed to four from unlimited, the minimum draw amount was increased to $10 million from $2.5 million and the draw period was shortened to 18 months from 24 months, the source said.

Furthermore, the company made some changes to documentation, including to MFN, incremental, restricted payments and investments, the asset sale sweep was removed, and quarterly lender calls and management discussion and analysis were added.

Pricing on the term loan debt remained at SOFR plus 450 basis points with a 0.5% floor.

The term loan still has 101 soft call protection for six months.

JPMorgan Chase Bank, BMO Capital Markets, Comerica, MUFG and Stifel are the leads on the deal.

Recommitments were scheduled to be due at noon ET on Thursday, the source added.

Proceeds will be used to repay existing debt, pay minority shareholders and add cash to the balance sheet in connection with an investment from Ares Management.

Interstate Waste is a Teaneck, N.J.-based provider of waste and recycling services.

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