Casella Waste Systems Inc., a Rutland, Vermont-based solid waste, recycling and resource management services company, has announced an amendment to its existing $650 million credit facility that links borrowing costs to progress in achieving certain annual sustainability goals.
The company also announced an amendment to its credit facility associated with the early adoption of term secured overnight financing rate (SOFR) as its reference rate, replacing the London interbank offered rate (LIBOR) in advance of its anticipated cessation later this year.
“As a leading provider of resource management services, sustainability has been at the core of our business for the last 45 years,” says John W. Casella, chairman and CEO of Casella Waste Systems Inc. “The implementation of the sustainability-linked credit facility further strengthens the alignment of our business strategies with continued advances in sustainability.”
The company established the following two measurable key performance indicators as part of its sustainability-linked credit facility:
improving its safety performance by lowering its total recordable incident rate (TRIR); and
growing its resource solutions business by reducing, reusing or recycling more tons of solid waste material.
“We believe that the safety of our people is our number one priority as a team and we are committed to continually improving the safety of our workforce,” Casella says. “Improving our TRIR metric through continued focus, training and select investments not only enhances our safety culture but could also lead to increased employee engagement and retention of key operational roles.”
The performance of these metrics will be measured annually against targets established within the amended credit facility. The company’s interest rate margin may adjust on the drawn or undrawn portion of the credit facility’s revolver based on attainment or failure to attain each metric.
In 2021, Casella entered into a $650 million amended and restated credit facility with Bank of America, N.A., as administrative agent and swing line lender; Bank of America, N.A., Citizens Bank, N.A., JPMorgan Chase Bank N.A. and Comerica Bank as joint lead arrangers and joint book runners; and certain other agents and lenders. The credit facility matures on December 22, 2026, and replaced Casella’s prior $550 million credit facility.
The credit facility provides for a term loan A facility in the amount of $350 million and a revolving credit facility in the principal amount of up to $300 million, with a $75 million sublimit for letters of credit.
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