e424b3
Filed Pursuant to Rule 424(b)(3)
Registration No. 333-166567
PROSPECTUS
Republic Services,
Inc.
Offers to Exchange all
Outstanding and Unregistered
5.00% Notes due
2020;
5.25% Notes due
2021;
5.50% Notes due 2019;
and
6.20% Notes due
2040
for
5.00% Notes due
2020;
5.25% Notes due
2021;
5.50% Notes due 2019;
and
6.20% Notes due
2040
Which Have Been Registered
Under the Securities Act
This prospectus and accompanying letter of transmittal relate to
our proposed offers to exchange up to $850,000,000 aggregate
principal amount of 5.00% notes due 2020 (the 2020
exchange notes), $600,000,000 aggregate principal amount
of 5.25% notes due 2021 (the 2021 exchange
notes), $650,000,000 aggregate principal amount of
5.50% notes due 2019 (the 2019 exchange notes),
and $650,000,000 aggregate principal amount of 6.20% notes
due 2040 (the 2040 exchange notes), all of which are
registered under the Securities Act of 1933, as amended, for any
and all of our unregistered 5.00% notes due 2020,
5.25% notes due 2021, 5.50% notes due 2019 and
6.20% notes due 2040 that were issued on March 4,
2010, November 25, 2009 , September 8, 2009 and
March 4, 2010, respectively. The 2020 exchange notes, the
2021 exchange notes, the 2019 exchange notes and the 2040
exchange notes are collectively referred to herein as the
exchange notes. The unregistered notes are, and the
exchange notes will be, fully and unconditionally and jointly
and severally guaranteed by substantially all of our direct and
indirect subsidiaries. All references to the unregistered notes
and the exchange notes include references to the related
guarantees. The unregistered notes have certain transfer
restrictions. The exchange notes will be freely transferable.
The principal features of the exchange offers are as follows:
EACH EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK
CITY TIME, ON AUGUST 2, 2010, UNLESS WE EXTEND THE
OFFER.
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You may withdraw tendered outstanding unregistered notes at any
time prior to the expiration of the applicable exchange offer.
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We will exchange all outstanding unregistered notes that are
validly tendered and not validly withdrawn prior to the
expiration of the applicable exchange offer for an equal
principal amount of the applicable exchange notes.
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The terms of each series of the exchange notes to be issued are
substantially similar to the applicable unregistered notes,
except they are registered under the Securities Act, do not have
any transfer restrictions and do not have registration rights or
rights to additional interest.
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The exchange of unregistered notes for exchange notes pursuant
to the exchange offers will not be a taxable event for
U.S. federal income tax purposes.
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We will not receive any proceeds from the exchange offers.
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We do not intend to apply for listing of the exchange notes on
any securities exchange or automated quotation system.
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Please see Risk Factors beginning on
page 11 for a discussion of certain factors you should
consider in connection with the exchange offers.
Neither the Securities and Exchange Commission nor any other
regulatory body has approved or disapproved of these securities
or passed upon the adequacy or accuracy of this prospectus. Any
representation to the contrary is a criminal offense.
The date of this prospectus is July 1, 2010.
Each holder of an unregistered note wishing to accept an
exchange offer must deliver the unregistered note to be
exchanged, together with the letter of transmittal that
accompanies this prospectus and any other required
documentation, to the applicable exchange agent identified in
this prospectus. Alternatively, you may effect a tender of
unregistered notes by book-entry transfer into the applicable
exchange agents account at The Depository
Trust Company (DTC). All deliveries are at the
risk of the holder. You can find detailed instructions
concerning delivery in the section called The Exchange
Offers in this prospectus and in the accompanying letter
of transmittal.
If you are a broker-dealer that receives exchange notes for your
own account, you must acknowledge that you will deliver a
prospectus in connection with any resale of the exchange
notes. The letter of transmittal accompanying this
prospectus states that, by so acknowledging and by delivering a
prospectus, you will not be deemed to admit that you are an
underwriter within the meaning of the Securities
Act. You may use this prospectus, as we may amend or supplement
it in the future, for your resales of exchange notes. We will
use commercially reasonable efforts to have the registration
statement, of which this prospectus forms a part, remain
effective for a period ending on the earlier of
(i) 180 days from the date on which this registration
statement is declared effective and (ii) the date on which
a broker-dealer is no longer required to deliver a prospectus in
connection with market-making or other trading activities. We
will also amend or supplement this prospectus during this
180-day
period, if requested by one or more participating
broker-dealers, in order to expedite or facilitate such resales.
Table of
Contents
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i
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iii
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1
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11
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23
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23
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24
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33
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48
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51
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51
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51
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52
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52
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ABOUT
THIS PROSPECTUS
You should rely only on the information contained in this
prospectus and in any applicable prospectus supplement. We have
not authorized any other person to provide you with different
information. The information contained in this prospectus and
any applicable prospectus supplement are accurate only as of the
date such information is presented. Our business, financial
condition, results of operations and prospects may have
subsequently changed. You should also read this prospectus
together with the additional information described under the
heading Where You Can Find More Information.
This prospectus may be supplemented from time to time to add,
update or change information in this prospectus. Any statement
contained in this prospectus will be deemed to be modified or
superseded for purposes of this prospectus to the extent that a
statement contained in such prospectus supplement modifies or
supersedes such statement. Any statement so modified will be
deemed to constitute a part of this prospectus only as so
modified, and any statement so superseded will be deemed not to
constitute a part of this prospectus.
The registration statement containing this prospectus,
including the exhibits to the registration statement, provides
additional information about us and the securities offered under
this prospectus. For further information relating to us and the
exchange notes, we refer you to the registration statement and
its exhibits, from which this prospectus incorporates important
business and financial information about us that is not included
in or delivered herewith. You may obtain a copy of the
registration statement and its exhibits, free of charge, by oral
or written request directed to: Republic Services, Inc., 18500
North Allied Way, Phoenix, AZ 85054, Attention: Investor
Relations, Phone:
(480) 627-2700.
To ensure timely delivery, please make your request as soon as
practicable and, in any event, no later than five business days
prior to the expiration of this exchange offer. The registration
statement, including the exhibits, can also be read on the
website of the Securities and Exchange Commission or at the
offices of the SEC mentioned under the heading Where You
Can Find More Information.
Company
References
As used in this prospectus the terms the Company,
Republic, we, us, and
our may, depending upon the context, refer to
Republic Services, Inc., our consolidated subsidiaries or to all
of them taken as a whole.
ii
DISCLOSURE
REGARDING FORWARD-LOOKING STATEMENTS
This prospectus, any prospectus supplement and the documents
incorporated by reference herein and therein contain certain
forward-looking information about us. Forward-looking statements
are statements that are not historical facts. Words such
as guidance, expect, will,
may, anticipate, could and
similar expressions are intended to identify forward-looking
statements. These statements include statements about the
expected benefits of our merger with Allied Waste Industries,
Inc. (Allied), our plans, strategies and prospects.
Forward-looking statements are not guarantees of performance.
These statements are based upon the current beliefs and
expectations of our management and are subject to risk and
uncertainties that could cause actual results to differ
materially from those expressed in, or implied or projected by,
the forward-looking information and statements. Although we
believe that the expectations reflected in the forward-looking
statements are reasonable, we can give no assurance that the
expectations will prove to be correct. Among the factors that
could cause actual results to differ materially from the
expectations expressed in the forward-looking statements are:
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the impact on us of our substantial post-merger indebtedness,
including our ability to obtain financing on acceptable terms to
finance our operations and growth strategy and to operate within
the limitations imposed by financing arrangements and the fact
that any downgrade in our bond ratings could adversely impact us;
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general economic and market conditions including, but not
limited to, the current global economic and financial market
crisis, inflation and changes in commodity pricing, fuel, labor,
risk and health insurance and other variable costs that are
generally not within our control, and our exposure to credit and
counterparty risk;
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whether our estimates and assumptions concerning our selected
balance sheet accounts, income tax accounts, final capping,
closure, post-closure and remediation costs, available airspace,
and projected costs and expenses related to our landfills and
property and equipment (including our estimates of the fair
values of the assets and liabilities acquired in our acquisition
of Allied), and labor, fuel rates and economic and inflationary
trends, turn out to be correct or appropriate;
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competition and demand for services in the solid waste industry;
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the fact that price increases or changes in commodity prices may
not be adequate to offset the impact of increased costs,
including but not limited to labor, third-party disposal and
fuel, and may cause us to lose volume;
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our ability to manage growth and execute our growth strategy;
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our compliance with, and future changes in, environmental and
flow control regulations and our ability to obtain approvals
from regulatory agencies in connection with operating and
expanding our landfills;
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our ability to retain our investment grade ratings for our debt;
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our dependence on key personnel;
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our dependence on large, long-term collection, transfer and
disposal contracts;
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the fact that our business is capital intensive and may consume
cash in excess of cash flow from operations;
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that any exposure to environmental liabilities, to the extent
not adequately covered by insurance, could result in substantial
expenses;
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risks associated with undisclosed liabilities of acquired
businesses;
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risks associated with pending and any future legal proceedings,
including our matters currently pending with the Internal
Revenue Service;
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severe weather conditions, which could impair our financial
results by causing increased costs, loss of revenue, reduced
operational efficiency or disruptions to our operations;
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compliance with existing and future legal and regulatory
requirements, including limitations or bans on disposal of
certain types of wastes or on the transportation of waste, which
could limit our ability to conduct or grow our business,
increase our costs to operate or require additional capital
expenditures;
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any litigation, audits or investigations brought by or before
any governmental body;
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iii
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workforce factors, including potential increases in our costs if
we are required to provide additional funding to any
multi-employer pension plan to which we contribute and the
negative impact on our operations of union organizing campaigns,
work stoppages or labor shortages;
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the negative effect that trends toward requiring recycling,
waste reduction at the source and prohibiting the disposal of
certain types of wastes could have on volumes of waste going to
landfills;
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changes by the Financial Accounting Standards Board or other
accounting regulatory bodies to generally accepted accounting
principles or policies;
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acts of war, riots or terrorism, including the events taking
place in the Middle East and the continuing war on terrorism, as
well as actions taken or to be taken by the United States or
other governments as a result of further acts or threats of
terrorism, and the impact of these acts on economic, financial
and social conditions in the United States; and
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the timing and occurrence (or non-occurrence) of transactions
and events which may be subject to circumstances beyond our
control.
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The risks included here are not exhaustive. Refer to Risk
Factors for further discussion regarding our exposure to
risks. You should be aware that any forward-looking statement
made by us in this prospectus, any prospectus supplement or the
documents incorporated herein or therein by reference or
elsewhere, speaks only as of the date on which we make it. New
risks and uncertainties come up from time to time, and it is
impossible for us to predict these events or how they may affect
us. In light of these risks and uncertainties, you should keep
in mind that any scenarios or results contained in any
forward-looking statement made in this prospectus, any
prospectus supplement or the documents incorporated herein or
therein by reference or elsewhere might not occur. Readers are
cautioned not to place undue reliance on these forward-looking
statements. Except to the extent required by applicable law or
regulation, we undertake no obligation to update or publish
revised forward-looking statements to reflect events or
circumstances after the date hereof or to reflect the occurrence
of unanticipated events.
iv
SUMMARY
This summary highlights selected information contained
elsewhere in this prospectus. Because this is only a summary, it
may not contain all of the information you should consider in
making your decision to participate in an exchange offer. To
understand all of the terms of this offering and for a more
complete understanding of our business, you should carefully
read this entire prospectus and the documents incorporated by
reference in this prospectus.
The
Company
We are the second largest provider of services in the domestic
non-hazardous solid waste industry as measured by revenue. We
provide non-hazardous solid waste collection services for
commercial, industrial, municipal and residential customers
through 367 collection companies in 40 states and Puerto
Rico and we also own or operate 217 transfer stations, 190
active solid waste landfills and 77 recycling facilities. We
also operate 75 landfill gas and renewable energy projects.
Our operations are national in scope, but the physical
collection and disposal of waste is very much a local business;
therefore, the dynamics and opportunities differ in each of our
markets. By combining local operating management with
standardized business practices, we can drive greater overall
operating efficiency across the company, while maintaining
day-to-day
operating decisions at the local level, closest to the customer.
We implement this strategy through an organizational structure
that groups our operations within a corporate, region and area
structure. We manage our operations through four geographic
operating segments which are also our reportable segments:
Eastern, Midwestern, Southern and Western. Each of our regions
is organized into several operating areas and each area contains
multiple operating locations. Each of our regions and
substantially all our areas provide collection, transfer,
recycling and disposal services. We believe this structure
facilitates the integration of our operations within each
region, which is a critical component of our operating strategy,
and allows us to maximize the growth opportunities in each of
our markets and to operate the business efficiently, while
maintaining effective controls and standards over operational
and administrative matters, including financial reporting.
On December 5, 2008, we acquired all of the issued and
outstanding shares of Allied Waste Industries, Inc.
(Allied) in a
stock-for-stock
transaction for an aggregate purchase price of
$12.1 billion, which included approximately
$5.4 billion of debt, at fair value. As a condition of the
merger with Allied, the Department of Justice (DOJ) required us
to divest of certain assets and related liabilities. As of
September 30, 2009, we completed our required divestitures.
As a result of our acquisition of Allied, we committed to a
restructuring plan related to our corporate overhead and other
administrative and operating functions. The plan included
closing our corporate office in Florida, consolidating
administrative functions to Arizona, the former headquarters of
Allied, and reducing staffing levels. The plan also included
closing and consolidating certain operating locations and
terminating certain leases. We believe that our merger with
Allied created a strong operating platform that will allow us to
continue to provide quality service to our customers and
superior returns to our stockholders.
We had revenue of $8.2 billion and $3.7 billion and
operating income of $1.6 billion and $0.3 billion for
the years ended December 31, 2009 and 2008, respectively.
In addition to our merger with Allied, a number of items
impacted our 2009 and 2008 financial results. For a description
of these items, see Item 7, Managements Discussion
and Analysis of Financial Condition and Results of
Operations Overview of Our Business and Consolidated
Results of Operations included in our Annual Report on
Form 10-K
for the year ended December 31, 2009, which is incorporated
by reference herein.
For the first quarter, we had revenue of $2.0 billion and
$2.1 billion and operating income of $0.4 million and
$0.4 million for the three months ended March 31, 2010
and 2009, respectively. In addition to our merger with Allied, a
number of items impacted our 2010 and 2009 financial results.
For a description of these items, see Item 2,
Managements Discussion and Analysis of Financial
Condition and Results of Operations Consolidated
Results of Operations included in our Interim Report on
Form 10-Q
for the three months ended March 31, 2010, which is
incorporated by reference herein. Operating results for interim
periods are not necessarily indicative of the results that can
be expected for a full year.
We were incorporated as a Delaware corporation in 1996. Our
principal and administrative offices are located at 18500 North
Allied Way, Phoenix, Arizona 85054. Our telephone number at that
location is
(480) 627-2700.
Our web site is located at
http://www.republicservices.com.
The information on our website is not part of this prospectus.
1
The
Exchange Offers
On September 8, 2009, we issued $650 million aggregate
principal amount of 5.50% notes due 2019, on
November 25, 2009, we issued $600 million aggregate
principal amount of 5.25% notes due 2021 and on
March 4, 2010, we issued $850 million aggregate
principal amount of 5.00% notes due 2020 and
$650 million aggregate principal amount of 6.20% notes
due 2040. On those same days, we and the initial purchasers of
the unregistered notes entered into a registration rights
agreement in which we agreed that you, as a holder of
unregistered notes, would be entitled to exchange your
unregistered notes for exchange notes registered under the
Securities Act of 1933, as amended. The exchange offers are
intended to satisfy these rights. After the applicable exchange
offer is completed, you will no longer be entitled to any
registration rights with respect to your unregistered notes.
Each series of exchange notes will be our obligations and will
be entitled to the benefits of the applicable indenture relating
to that series of exchange notes. The form and terms of the each
series of exchange notes are identical in all material respects
to the form and terms of the applicable unregistered notes,
except that:
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the exchange notes have been registered under the Securities Act
and, therefore, will contain no restrictive legends;
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the exchange notes will not have registration rights; and
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the exchange notes will not have rights to additional interest.
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The Exchange Offers |
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We are offering to exchange any and all of our 5.00% notes
due 2020, 5.25% notes due 2021, 5.50% notes due 2019,
and 6.20% notes due 2040, all of which have been registered
under the Securities Act, for any and all of our outstanding
unregistered 5.00% notes due 2020 that were issued March 4,
2010, unregistered 5.25% notes due 2021 that were issued
November 25, 2009, unregistered 5.50% notes due 2019 that
were issued September 8, 2009 and unregistered 6.20% notes
due 2040 that were issued March 4, 2010. As of the date of this
prospectus, $850 million in aggregate principal amount of our
unregistered 5.00% notes due 2020, $600 million in
aggregate principal amount of our unregistered 5.25% notes
due 2021, $650 million in aggregate principal amount of our
unregistered 5.50% notes due 2019 and $650 million in
aggregate principal amount of our unregistered 6.20% notes
due 2040 are outstanding. |
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Expiration of the Exchange Offers |
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The exchange offers will expire at 5:00 p.m., New York City
time, on August 2, 2010, unless we decide to extend any
exchange offer. |
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Conditions of the Exchange Offers |
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We will not be required to accept for exchange any unregistered
notes, and may amend or terminate an exchange offer, if any of
the following conditions or events occurs: |
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the applicable exchange offer or the making of any
exchange by a holder of unregistered notes violates applicable
law or any applicable interpretation of the staff of the SEC;
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any action or proceeding shall have been instituted
or threatened with respect to the applicable exchange offer
which, in our reasonable judgment, would impair our ability to
proceed with the exchange offer; and
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any laws, rules or regulations or applicable
interpretations of the staff of the SEC are issued or
promulgated which, in our good faith determination, do not
permit us to effect the applicable exchange offer.
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We will give oral or written notice of any non-acceptance,
amendment or termination to the registered holders of the
unregistered notes as promptly as practicable. We reserve the
right to waive any conditions of any exchange offer. |
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Resale of the Exchange Notes |
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Under existing interpretations of the Securities Act by the SEC
contained in several no action letters to third parties, and
subject to the immediately following sentence, we believe that
the exchange notes would generally be freely transferable by
holders thereof after the applicable exchange offer without
further registration under the Securities Act (subject to
certain representations required to be made by each holder of
unregistered notes, as set forth below). However, any purchaser
of notes who is an affiliate of us or any guarantor
and any purchaser of notes who intends to participate in any
exchange offer for the purpose of distributing the exchange
notes: |
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will not be able to rely on the interpretation of
the staff of the SEC;
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will not be able to tender its unregistered notes in
the exchange offer; and
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must comply with the registration and prospectus
delivery requirements of the Securities Act in connection with
any sale or transfer of the notes unless such sale or transfer
is made pursuant to an exemption from such requirements.
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In addition, in connection with any resales of exchange notes,
any broker dealer, which we refer to as a Participating Broker
Dealer, which acquired the unregistered notes for its own
account as a result of market making or other trading activities
must deliver a prospectus meeting the requirements of the
Securities Act. The SEC has taken the position that
Participating Broker Dealers may fulfill their prospectus
delivery requirements with respect to the exchange notes with
this prospectus. If we receive notice from one or more
Participating Broker Dealers in connection with an exchange
offer or within 20 days after consummation of the exchange
offer that such Participating Broker Dealer is exchanging or has
exchanged notes acquired for the account of such Participating
Broker Dealer as a result of market-making or other trading
activities, we will agree to make available for a period of up
to 180 days after consummation of the exchange offer a
prospectus meeting the requirements of the Securities Act to any
Participating Broker Dealer and any other persons with similar
prospectus delivery requirements for use in connection with any
resale of exchange notes. A Participating Broker Dealer or any
other person that delivers such a prospectus to purchasers in
connection with such resales will be subject to certain of the
civil liability provisions under the Securities Act and will be
bound by the provisions of the registration rights agreement
(including certain indemnification rights and obligations
thereunder). |
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Each holder of the unregistered notes who wishes to exchange
their notes for exchange notes in an exchange offer will be
required to make certain representations, including
representations that: |
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any exchange notes to be received by it will be
acquired in the ordinary course of its business;
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it has no arrangement or understanding with any
person to participate in the distribution (within the meaning of
the Securities Act) of the exchange notes; and
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it is not an affiliate (as defined in
Rule 405 under the Securities Act) of us or any guarantor.
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Accrued Interest on the Exchange Notes and Unregistered
Notes |
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Holders of unregistered notes whose unregistered notes are
accepted for exchange in the exchange offers will be deemed to
have waived the right to receive any payment in respect of
interest on the unregistered notes accrued from the date of
issuance or the last interest payment date, as applicable.
Consequently, holders who exchange their unregistered notes for
exchange notes will receive the same interest payment on the
next interest payment date with respect to the unregistered
notes and the first interest payment date with respect to the
exchange notes following consummation of the exchange offers
that they would have received if they had not accepted the
exchange offer. We will pay interest on the exchange notes
semi-annually on March 1 and September 1, commencing
September 1, 2010 (in the case of the 2020 exchange notes
and 2040 exchange notes), March 15 and September 15,
commencing September 15, 2010 (in the case of the 2019
exchange notes), and May 15 and November 15, commencing
November 15, 2010 (in the case of the 2021 exchange notes). |
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Procedures for Tendering Unregistered Notes |
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If you wish to participate in an exchange offer, you must: |
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transmit a properly completed and signed letter of
transmittal, and all other documents required by the letter of
transmittal, to the applicable exchange agent at the address set
forth in the letter of transmittal. These materials must be
received by the applicable exchange agent before 5:00 p.m.,
New York City time, on August 2, 2010, the expiration date
of the exchange offers. You must also provide physical delivery
of your unregistered notes to the applicable exchange
agents address as set forth in the letter of transmittal.
The letter of transmittal must also contain the representations
you must make to us as described under The Exchange Offers
Procedures for Tendering; or
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you may effect a tender of unregistered notes
electronically by book-entry transfer into the exchange
agents account at DTC. By tendering the unregistered notes
by book-entry transfer, you must agree to be bound by the terms
of the letter of transmittal.
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Special Procedures for Beneficial Owners |
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If you are a beneficial owner of unregistered notes that are
held through a broker-dealer, commercial bank, trust company or
other nominee and you wish to tender such unregistered notes,
you should contact the registered holder promptly and instruct
them to tender your unregistered notes on your behalf. |
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Acceptance of Outstanding Notes and Delivery of Exchange
Notes |
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Subject to customary conditions, we will accept outstanding
unregistered notes that are properly tendered in the exchange
offers and not |
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withdrawn prior to the expiration date. The exchange notes will
be delivered promptly following the expiration date. |
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Withdrawal Rights |
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You may withdraw the tender of your unregistered notes at any
time prior to 5:00 p.m., New York City time, on
August 2, 2010, the expiration date. |
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Consequences of Failure to Exchange |
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If you are eligible to participate in the exchange offers and
you do not tender your unregistered notes as described in this
prospectus, your unregistered notes may continue to be subject
to transfer restrictions. As a result of the transfer
restrictions and the availability of exchange notes, the market
for the unregistered notes is likely to be much less liquid than
before the exchange offers. The unregistered notes will, after
the exchange offers, bear interest at the same rate as the
exchange notes. The unregistered notes will not retain any
rights under the applicable registration rights agreement. |
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Material United States Federal Income Tax Considerations |
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The exchange of the unregistered notes for exchange notes
pursuant to the exchange offers will not be a taxable event for
U.S. federal income tax purposes. See Material U.S.
Federal Income Tax Considerations. |
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Exchange Agents |
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U.S. Bank National Association has been appointed as the
exchange agent for the 2020 exchange notes, 2021 exchange notes
and 2040 exchange notes. The Bank of New York Mellon
Trust Company, N.A., has been appointed as the exchange
agent for the 2019 exchange notes. |
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Use of Proceeds |
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We will not receive any proceeds from the issuance of exchange
notes in the exchange offers. |
5
Summary
Description of the Exchange Notes
The following summary contains basic information about the
notes and is not intended to be complete. It may not contain all
of the information that is important to you. Certain terms and
conditions described below are subject to important limitations
and exceptions. For a more complete description of the terms of
the exchange notes, see Description of the Notes.
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Issuer |
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Republic Services, Inc. |
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Exchange Notes |
|
$850,000,000 aggregate principal amount of 5.00% notes due
2020. |
|
|
|
$600,000,000 aggregate principal amount of 5.25% notes due
2021. |
|
|
|
$650,000,000 aggregate principal amount of 5.50% notes due
2019. |
|
|
|
$650,000,000 aggregate principal amount of 6.20% notes due
2040. |
|
Maturity Dates |
|
The 2020 exchange notes will mature on March 1, 2020. |
|
|
|
The 2021 exchange notes will mature on November 15, 2021. |
|
|
|
The 2019 exchange notes will mature on September 15, 2019. |
|
|
|
The 2040 exchange notes will mature on March 1, 2040. |
|
Interest Rate |
|
Interest on the exchange notes will accrue from the last
interest payment date on which interest was paid on the
unregistered notes or, if no interest has been paid on the
unregistered notes, from the date of issuance of the
unregistered notes. Interest will accrue on the exchange notes
at the annual rate of 5.00%, in the case of the 2020 exchange
notes, 5.25%, in the case of the 2021 exchange notes, 5.50%, in
the case of the 2019 exchange notes and 6.20%, in the case of
the 2040 exchange notes. |
|
Interest Payment Dates |
|
March 1 and September 1, beginning September 1, 2010
for the 2020 exchange notes. |
|
|
|
May 15 and November 15, beginning November 15, 2010 for the
2021 exchange notes. |
|
|
|
March 15 and September 15, beginning September 15,
2010 for the 2019 exchange notes. |
|
|
|
March 1 and September 1, beginning September 1, 2010
for the 2040 exchange notes. |
|
Guarantees |
|
The exchange notes initially will be guaranteed, fully and
unconditionally and jointly and severally, by all of our
subsidiaries that guarantee the unregistered notes and our
credit facilities. Each guarantee will be a senior obligation of
the guarantor, will rank equally with all unsecured and
unsubordinated indebtedness of the guarantor from time to time
outstanding, will rank senior to any subordinated indebtedness
of the guarantor from time to time outstanding and will rank
junior to any secured indebtedness of a guarantor from time to
time outstanding to the extent of the value of the assets
securing such. |
|
Ranking |
|
The exchange notes, like the unregistered notes, will be our
unsecured unsubordinated obligations and will rank equally with
all of our other unsecured and unsubordinated indebtedness from
time to time outstanding. The exchange notes will be senior to
any of our subordinated indebtedness from time to time
outstanding and will rank junior to our |
6
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|
|
secured indebtedness from time to time outstanding to the extent
of the value of the assets securing such indebtedness. The
exchange notes will also be effectively junior in right of
payment to all existing and future liabilities, including trade
payables, of our domestic subsidiaries that do not guarantee the
notes and all of our foreign subsidiaries, which will not
guarantee the notes. |
|
Optional Redemption |
|
At our option, we may redeem some or all of the exchange notes,
at any time or from time to time at the redemption price
described in this prospectus plus accrued and unpaid interest.
The redemption prices are described under Description of
the Exchange Notes Optional Redemption in this
prospectus. |
|
Change of Control |
|
If we experience specific kinds of changes of control, each
holder of the exchange notes will have the right to require us
to purchase all or a portion of such holders exchange
notes, at a purchase price equal to 101% of the principal amount
thereof plus accrued and unpaid interest. See Description
of the Exchange Notes Change in Control Triggering
Event in this prospectus. |
|
Covenants |
|
The indentures governing the exchange notes provide for certain
limitations on our ability and the ability of certain of our
subsidiaries to (i) create liens on the capital stock or
indebtedness of any principal subsidiary or certain property and
(ii) enter into sale and leaseback transactions. |
|
Consolidations, Mergers and Sales of Assets |
|
We may not consolidate, merge or sell substantially all of our
assets as an entirety, unless, among other requirements:
(i) the successor corporation assumes our obligations on
the exchange notes and (ii) no Event of Default (as defined
in the applicable indenture governing the exchange notes) has
occurred and is continuing. |
|
Events of Default Cross Default |
|
Failure to pay when due any of our obligations or any of our
principal subsidiaries obligations in the aggregate
principal amount of at least $25 million that continues for
25 days after notice to us by the trustee or holders of at
least 25% in principal amount of any series of notes then
outstanding constitutes a default under the applicable indenture
governing the series of notes. |
|
Discharge |
|
The indentures governing the exchange notes are subject to
defeasance and discharge under certain circumstances. |
Investing in the exchange notes involves substantial risks.
See Risk Factors beginning on page 11 for a
discussion of certain risks relating to us, our business and an
investment in the notes that you should carefully consider
before investing in the exchange notes.
7
Summary
Historical Consolidated Financial Data
The Statement of Operations Data and Other Operating Data for
each of the years ended December 31, 2009, 2008, 2007, 2006
and 2005 and the Balance Sheet Data at December 31, 2009,
2008, 2007, 2006 and 2005 is derived from our audited
consolidated financial statements. The Statement of Operations
Data and Other Operating Data for the three months ended
March 31, 2010 and 2009 and the Balance Sheet Data as of
March 31, 2010 is derived from our unaudited condensed
consolidated financial statements. You should not regard the
results of operations for the three months ended March 31,
2010 as indicative of the results that may be expected for the
entire fiscal year. You should read our discussion regarding
The Company beginning on page 1.
The following information should be read in conjunction with our
historical consolidated financial statements and the related
notes and Managements Discussion and Analysis of
Financial Condition and Results of Operations included in
our Interim Report on
Form 10-Q
for the three months ended March 31, 2010, and in our
Annual Report on
Form 10-K
for the year ended December 31, 2009, which are
incorporated by reference herein.
We are the second largest provider of services in the domestic
non-hazardous solid waste industry, as measured by revenue. We
provide non-hazardous solid waste collection services for
commercial, industrial, municipal and residential customers
through 367 collection companies in 40 states and Puerto
Rico. We own or operate 217 transfer stations, 190 active solid
waste landfills and 77 recycling facilities. We also operate
75 landfill gas and renewable energy projects. We completed
our merger with Allied in December 2008.
On December 5, 2008, we acquired all of the issued and
outstanding shares of Allied in a
stock-for-stock
transaction for an aggregate purchase price of
$12.1 billion, which included approximately
$5.4 billion of debt, at fair value.
We primarily used the proceeds from the unregistered notes to
redeem or tender for certain of our outstanding senior notes
before their scheduled maturity. As such for the three months
ended March 31, 2010 and the year ended December 31,
2009, we incurred a loss on extinguishment of debt in the amount
of $132.1 million and $134.1 million for premiums paid
to repurchase debt, charges for unamortized debt discounts and
professional fees paid to effectuate the repurchase of the
senior notes.
These historical results are not necessarily indicative of the
results to be expected in the future. Amounts are in millions,
except per share data.
8
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|
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|
|
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|
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three Months Ended
|
|
|
|
|
|
|
March 31,
|
|
|
Year Ended December 31,
|
|
|
|
2010
|
|
|
2009
|
|
|
2009
|
|
|
2008
|
|
|
2007
|
|
|
2006
|
|
|
2005
|
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statement of Operations Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
|
$
|
1,957.7
|
|
|
$
|
2,060.5
|
|
|
$
|
8,199.1
|
|
|
$
|
3,685.1
|
|
|
$
|
3,176.2
|
|
|
$
|
3,070.6
|
|
|
$
|
2,863.9
|
|
Expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost of operations
|
|
|
1,136.8
|
|
|
|
1,208.7
|
|
|
|
4,844.2
|
|
|
|
2,416.7
|
|
|
|
2,003.9
|
|
|
|
1,924.4
|
|
|
|
1,803.9
|
|
Depreciation, amortization and depletion
|
|
|
203.0
|
|
|
|
221.8
|
|
|
|
869.7
|
|
|
|
354.1
|
|
|
|
305.5
|
|
|
|
296.0
|
|
|
|
278.8
|
|
Accretion
|
|
|
20.2
|
|
|
|
23.3
|
|
|
|
88.8
|
|
|
|
23.9
|
|
|
|
17.1
|
|
|
|
15.7
|
|
|
|
14.5
|
|
Selling, general and administrative
|
|
|
210.3
|
|
|
|
217.5
|
|
|
|
880.4
|
|
|
|
434.7
|
|
|
|
313.7
|
|
|
|
315.0
|
|
|
|
289.5
|
|
Loss (gain) on disposition of assets and impairments, net
|
|
|
0.5
|
|
|
|
4.9
|
|
|
|
(137.0
|
)
|
|
|
89.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Restructuring charges
|
|
|
5.6
|
|
|
|
31.3
|
|
|
|
63.2
|
|
|
|
82.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating income
|
|
|
381.3
|
|
|
|
353.0
|
|
|
|
1,589.8
|
|
|
|
283.2
|
|
|
|
536.0
|
|
|
|
519.5
|
|
|
|
477.2
|
|
Interest expense
|
|
|
(134.5
|
)
|
|
|
(153.5
|
)
|
|
|
(595.9
|
)
|
|
|
(131.9
|
)
|
|
|
(94.8
|
)
|
|
|
(95.8
|
)
|
|
|
(81.0
|
)
|
Loss on extinguishment of debt
|
|
|
(132.3
|
)
|
|
|
|
|
|
|
(134.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest income
|
|
|
|
|
|
|
0.7
|
|
|
|
2.0
|
|
|
|
9.6
|
|
|
|
12.8
|
|
|
|
15.8
|
|
|
|
11.4
|
|
Other income (expense), net
|
|
|
1.7
|
|
|
|
0.2
|
|
|
|
3.2
|
|
|
|
(1.6
|
)
|
|
|
14.1
|
|
|
|
4.2
|
|
|
|
1.6
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income before income taxes
|
|
|
116.2
|
|
|
|
200.4
|
|
|
|
865.0
|
|
|
|
159.3
|
|
|
|
468.1
|
|
|
|
443.7
|
|
|
|
409.2
|
|
Provision for income taxes
|
|
|
51.0
|
|
|
|
87.0
|
|
|
|
368.5
|
|
|
|
85.4
|
|
|
|
177.9
|
|
|
|
164.1
|
|
|
|
155.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
|
|
|
65.2
|
|
|
|
113.4
|
|
|
|
496.5
|
|
|
|
73.9
|
|
|
|
290.2
|
|
|
|
279.6
|
|
|
|
253.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Less: Income attributable to noncontrolling interests
|
|
|
(0.2
|
)
|
|
|
(0.4
|
)
|
|
|
(1.5
|
)
|
|
|
(0.1
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income attributable to Republic Services, Inc.
|
|
$
|
65.0
|
|
|
$
|
113.0
|
|
|
$
|
495.0
|
|
|
$
|
73.8
|
|
|
$
|
290.2
|
|
|
$
|
279.6
|
|
|
$
|
253.7
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share attributable to Republic Services, Inc.
stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Basic earnings per share
|
|
$
|
0.17
|
|
|
$
|
0.30
|
|
|
$
|
1.30
|
|
|
$
|
0.38
|
|
|
$
|
1.53
|
|
|
$
|
1.41
|
|
|
$
|
1.23
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common shares outstanding
|
|
|
381.4
|
|
|
|
378.9
|
|
|
|
379.7
|
|
|
|
196.7
|
|
|
|
190.1
|
|
|
|
198.2
|
|
|
|
207.0
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share attributable to Republic Services,
Inc. stockholders:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Diluted earnings per share
|
|
$
|
0.17
|
|
|
$
|
0.30
|
|
|
$
|
1.30
|
|
|
$
|
0.37
|
|
|
$
|
1.51
|
|
|
$
|
1.39
|
|
|
$
|
1.20
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted average common and common equivalent shares outstanding
|
|
|
383.3
|
|
|
|
379.9
|
|
|
|
381.0
|
|
|
|
198.4
|
|
|
|
192.0
|
|
|
|
200.6
|
|
|
|
210.8
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash dividends per common share
|
|
$
|
0.1900
|
|
|
$
|
0.1900
|
|
|
$
|
0.7600
|
|
|
$
|
0.7200
|
|
|
$
|
0.5534
|
|
|
$
|
0.4000
|
|
|
$
|
0.3466
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Operating Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities
|
|
$
|
299.1
|
|
|
$
|
512.4
|
|
|
$
|
1,396.5
|
|
|
$
|
512.2
|
|
|
$
|
661.3
|
|
|
$
|
511.2
|
|
|
$
|
747.8
|
|
Capital expenditures
|
|
|
208.4
|
|
|
|
193.4
|
|
|
|
826.3
|
|
|
|
386.9
|
|
|
|
292.5
|
|
|
|
326.7
|
|
|
|
309.0
|
|
Proceeds from sales of property and equipment
|
|
|
5.9
|
|
|
|
4.9
|
|
|
|
31.8
|
|
|
|
8.2
|
|
|
|
6.1
|
|
|
|
18.5
|
|
|
|
10.1
|
|
9
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
As of March 31,
|
|
As of December 31,
|
|
|
2010
|
|
2009
|
|
2008
|
|
2007
|
|
2006
|
|
2005
|
|
|
(Unaudited)
|
|
|
|
|
|
|
|
|
|
|
|
Balance Sheet Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash and cash equivalents
|
|
$
|
81.4
|
|
|
$
|
48.0
|
|
|
$
|
68.7
|
|
|
$
|
21.8
|
|
|
$
|
29.1
|
|
|
$
|
131.8
|
|
Restricted cash and marketable securities
|
|
|
221.8
|
|
|
|
240.5
|
|
|
|
281.9
|
|
|
|
165.0
|
|
|
|
153.3
|
|
|
|
255.3
|
|
Total assets
|
|
|
19,465.3
|
|
|
|
19,540.3
|
|
|
|
19,921.4
|
|
|
|
4,467.8
|
|
|
|
4,429.4
|
|
|
|
4,550.5
|
|
Total debt
|
|
|
7,114.0
|
|
|
|
6,962.6
|
|
|
|
7,702.5
|
|
|
|
1,567.8
|
|
|
|
1,547.2
|
|
|
|
1,475.1
|
|
Total stockholders equity
|
|
|
7,568.7
|
|
|
|
7,567.1
|
|
|
|
7,282.5
|
|
|
|
1,303.8
|
|
|
|
1,422.1
|
|
|
|
1,605.8
|
|
10
RISK
FACTORS
You should carefully consider the risks described below
before making a decision to participate in the exchange offers.
Prior to making a decision about whether to participate in the
exchange offers, you should carefully consider all of the
information set forth in this prospectus and any documents
incorporated by reference herein and, in particular, the risks
and uncertainties described below, together with the risk
factors discussed in our Annual Report on
Form 10-K
for the year ended December 31, 2009. The occurrence of any
of those risks and uncertainties may materially adversely affect
our financial condition, results of operations, cash flows or
business. In that case, the price or value of our securities
could decline and you could lose all or part of your investment.
You are encouraged to perform your own investigation with
respect to the exchange notes and our company. Some of the
statements in this discussion of risk factors are
forward-looking statements. See Forward-Looking
Statements.
Risks
Related to the Exchange Notes and the Exchange Offers
We
have substantial indebtedness, which may limit our financial
flexibility.
As of March 31, 2010, we had approximately
$7.5 billion in principal value of debt and capital leases
outstanding. This amount of indebtedness and our debt service
requirements may limit our financial flexibility to access
additional capital and make capital expenditures and other
investments in our business, to withstand economic downturns and
interest rate increases, to plan for or react to changes in our
business and our industry, and to comply with the financial and
other restrictive covenants of our debt instruments. Further,
our ability to comply with the financial and other covenants
contained in our debt instruments may be affected by changes in
economic or business conditions or other events that are beyond
our control. If we do not comply with these covenants and
restrictions, we may be required to take actions such as
reducing or delaying capital expenditures, reducing dividends,
selling assets, restructuring or refinancing all or part of our
existing debt, or seeking additional equity capital.
We may
be able to incur substantially more debt. This could exacerbate
the risks associated with our indebtedness.
We and our subsidiaries may be able to incur substantial
additional indebtedness in the future. The exchange notes and
the existing terms of our other debt do not prohibit us and our
subsidiaries from incurring significant additional indebtedness
in the future, subject to maintenance of certain financial
covenants in our credit facilities. If new debt is added to our
current debt levels, the related risks that we and our
subsidiaries now face could intensify.
We may
not be able to purchase the exchange notes if we experience a
change of control triggering event.
If we experience a change of control triggering event, we will
be required to offer to purchase each holders exchange
notes at a price equal to 101% of their principal amount plus
accrued and unpaid interest. When such change of control event
occurs, we may not have sufficient financial resources to
purchase all of the exchange notes that holders tender to us in
connection with a change of control offer. The instruments
governing our credit facilities also provide that a change of
control will be a default that allows the lenders thereunder to
accelerate the maturity of borrowings thereunder and we have
other debt that must be repurchased upon a change of control.
Any future debt agreements may contain similar provisions. Our
failure to purchase the exchange notes as required under the
applicable indenture governing the exchange notes would be a
default, which could have material adverse consequences for us.
See Description of the Exchange Notes Change
of Control Triggering Event.
The
exchange notes and guarantees are unsecured and will be
effectively subordinated to all of our and our subsidiary
guarantors existing and future secured obligations to the
extent of the collateral securing such
obligations.
The exchange notes and guarantees are unsecured and will be
effectively subordinated to all of our and our subsidiary
guarantors secured obligations from time to time
outstanding to the extent of the collateral securing such
obligations. Our $1.75 billion and $1.0 billion
revolving credit facilities are unsecured. As of March 31,
2010, we had $91.6 million of obligations under capital
leases. The applicable indenture governing the exchange notes
11
generally will allow us to incur liens in an amount up to, in
addition to specified permitted liens, 20% of our consolidated
net tangible assets. As of March 31, 2010, the book value
of our property and equipment, including landfill development
costs, approximated $6.6 billion.
We
conduct a substantial portion of our operations through our
subsidiaries. Not all of our subsidiaries will guarantee the
exchange notes and assets of our non-guarantor subsidiaries may
not be available to make payments on the exchange
notes.
Cash flow and our ability to service debt, including the
exchange notes, depends substantially on the distribution of
earnings, loans or other payments made by our subsidiaries to
us. If distributions from our subsidiaries to us were
eliminated, delayed, reduced or otherwise impaired, our ability
to make payments on the exchange notes would be substantially
impaired. Payments on the exchange notes will only be required
to be made by us and the subsidiary guarantors. The
non-guarantor subsidiaries include subsidiaries that are not
wholly owned, insurance companies, other finance-related
subsidiaries and other subsidiaries which are not guarantors
under our credit facilities. Because the non-guaranteeing
subsidiaries may have other creditors and are not obligated to
repay and do not guarantee repayment of the exchange notes, you
cannot rely on such subsidiaries to make any payments on the
exchange notes directly to you or to make sufficient
distributions to enable us to satisfy our obligations to you
under the exchange notes. If any or all of our non-guarantor
subsidiaries become the subject of a bankruptcy, liquidation or
reorganization, the creditors of the subsidiary or subsidiaries,
including debt holders, must be paid in full out of the
subsidiarys or subsidiaries assets before any monies
may be distributed to us as the holder of the equity in the
subsidiary or subsidiaries.
The
subsidiary guarantees of the exchange notes may be limited in
duration.
The exchange notes will be guaranteed by substantially all of
our subsidiaries. The subsidiary guarantors may be released from
their respective obligations under the applicable indenture
under certain circumstances. Under such circumstances the
exchange notes would no longer have the benefit of subsidiary
guarantees and holders of the exchange notes would no longer
have direct claims against the subsidiary guarantors.
The
subsidiary guarantees of the exchange notes may be subject to
review under United States federal or state fraudulent transfer
law, which could limit their enforceability.
To the extent that a United States court were to find that
(x) the guarantees were incurred with intent to hinder,
delay or defraud any present or future creditor, or a subsidiary
guarantor contemplated insolvency with a design to prefer one or
more creditors to the exclusion in whole or in part of others,
or (y) the subsidiary issuing the guarantee did not receive
fair consideration or reasonably equivalent value for issuing
its guarantees and any subsidiary guarantor (i) was
insolvent, (ii) was rendered insolvent by reason of the
issuance of the guarantees, (iii) was engaged or about to
engage in a business or transaction for which the remaining
assets of a subsidiary guarantor constituted unreasonably small
capital to carry on its business or (iv) intended to incur,
or believed that it would incur, debts beyond its ability to pay
such debts as they matured, that court could avoid or
subordinate the guarantees in favor of a subsidiary
guarantors other creditors. If the guarantees are
subordinated, payments of principal and interest on the exchange
notes generally would be subject to the prior payment in full of
all other indebtedness of the subsidiary guarantor. Among other
things, a legal challenge of the guarantees on fraudulent
conveyance grounds may focus on the benefits, if any, realized
by the subsidiary guarantor as a result of the issuance by us of
the exchange notes. The extent (if any) to which a particular
subsidiary guarantor may be deemed to have received such
benefits may depend on our use of the proceeds of this offering,
including the extent (if any) to which such proceeds or benefits
therefrom are contributed to the subsidiary guarantor. The
measure of insolvency for purposes of the foregoing will vary
depending on the law of the applicable jurisdiction. Generally,
however, an entity would be considered insolvent if the sum of
its debts (including contingent or unliquidated debts) is
greater than all of its property at a fair valuation or if the
present fair saleable value of its assets is less than the
amount that will be required to pay its probable liability under
its existing debts as such debts become absolute and matured.
Based upon financial and other information currently available
to us, we presently believe that the guarantees are being
incurred for proper purposes and in good faith, and that the
subsidiary guarantors (i) are solvent and will continue to
be solvent after issuing the guarantees, (ii) will have
sufficient capital for carrying on their business after such
issuance and (iii) will
12
be able to pay their debts as they mature. There can be no
assurance, however, that a court would necessarily agree with
these conclusions, or determine that any particular subsidiary
guarantor received fair consideration or reasonably equivalent
value for issuing its guarantee.
Your
ability to transfer the exchange notes may be limited by the
absence of an active trading market, and there is no assurance
that any active trading market will develop for the exchange
notes.
There is no existing trading market for the exchange notes. We
do not intend to have the exchange notes listed on a national
securities exchange. The initial purchasers of the unregistered
notes have advised us that they intend to make a market in the
exchange notes, as permitted by applicable laws and regulations;
however, the initial purchasers of the unregistered notes are
not obligated to make a market in the exchange notes, and they
may discontinue their market-making activities at any time
without notice. Therefore, we cannot assure you that an active
market for the exchange notes will develop or, if developed,
that such a market will continue. In addition, subsequent to the
exchange offers, the exchange notes may trade at a discount from
their initial offering price, depending upon prevailing interest
rates, the market for similar notes, our performance and other
factors.
You
may not be able to sell your unregistered notes if you do not
exchange them for exchange notes in the applicable exchange
offer.
If you do not exchange your unregistered notes for exchange
notes in the applicable exchange offer, your unregistered notes
will continue to be subject to the restrictions on transfer as
stated in the legend on the unregistered notes. In general, you
may not reoffer, resell or otherwise transfer the unregistered
notes in the United States unless they are:
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registered under the Securities Act;
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offered or sold under an exemption from the Securities Act and
applicable state securities laws; or
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offered or sold in a transaction not subject to the Securities
Act and applicable state securities laws.
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We do not currently anticipate that we will register the offer
or sale of the unregistered notes under the Securities Act.
Holders
of the unregistered notes who do not tender their unregistered
notes will have no further registration rights under the
applicable registration rights agreement.
Holders who do not tender their unregistered notes will not have
any further registration rights under the applicable
registration rights agreement or otherwise and will not have
rights to receive additional interest.
The
market for unregistered notes may be significantly more limited
after the exchange offers and you may not be able to sell your
unregistered notes after the exchange offers.
If unregistered notes are tendered and accepted for exchange
under the applicable exchange offer, the trading market for
unregistered notes that remain outstanding may be significantly
more limited. As a result, the liquidity of the unregistered
notes not tendered for exchange could be adversely affected. The
extent of the market for unregistered notes of any series and
the availability of price quotations would depend upon a number
of factors, including the number of holders of unregistered
notes of that series remaining outstanding and the interest of
securities firms in maintaining a market in the unregistered
notes of that series. An issue of securities with a similar
outstanding market value available for trading, which is called
the float, may command a lower price than would be
comparable to an issue of securities with a greater float. As a
result, the market price for unregistered notes that are not
exchanged in the exchange offers may be affected adversely as
unregistered notes exchanged in the exchange offers reduce the
float. The reduced float also may make the trading price of the
unregistered notes that are not exchanged more volatile.
13
Your
unregistered notes will not be accepted for exchange if you fail
to follow the applicable exchange offer procedures and, as a
result, your unregistered notes will continue to be subject to
existing transfer restrictions and you may not be able to sell
your unregistered notes.
We will not accept your unregistered notes for exchange if you
do not follow the applicable exchange offer procedures. We will
issue exchange notes as part of the applicable exchange offer
only after timely receipt of your unregistered notes, a properly
completed and duly executed letter of transmittal and all other
required documents. Therefore, if you want to tender your
unregistered notes, please allow sufficient time to ensure
timely delivery. If we do not receive your unregistered notes,
letter of transmittal and other required documents by the
expiration date of the applicable exchange offer, we will not
accept your unregistered notes for exchange. We are under no
duty to give notification of defects or irregularities with
respect to the tenders of unregistered notes for exchange. If
there are defects or irregularities with respect to your tender
of unregistered notes, we will not accept your unregistered
notes for exchange.
Some
persons who participate in the exchange offers must deliver a
prospectus in connection with resales of the exchange
notes.
Based on interpretations of the staff of the SEC contained in no
action letters with third parties unrelated to us, we believe
that you may offer for resale, resell or otherwise transfer the
exchange notes without compliance with the registration and
prospectus delivery requirements of the Securities Act so long
as the conditions described in The Exchange
Offers Resale of Exchange Notes are satisfied.
However, in some instances, including those described in this
prospectus under Plan of Distribution, you will
remain obligated to comply with certain prospectus delivery
requirements of the Securities Act to transfer your exchange
notes. In these cases, if you transfer any exchange note without
delivering a prospectus meeting the requirements of the
Securities Act or without an exemption from registration of your
exchange notes under the Securities Act, you may incur liability
under this Act. We do not and will not assume, or indemnify you
against, this liability.
Risks
Related to the Company
The
downturn in the U.S. economy may continue to have an adverse
impact on our operating results.
A weak economy generally results in decreases in the volumes of
waste generated. In 2009, weakness in the U.S. economy had
a negative effect on our revenue, operating results and
operating cash flows. The current and previous economic
slowdowns have negatively impacted the portion of our collection
business servicing the manufacturing and construction industries
and our proceeds from sales of recycled commodities. As a result
of the global economic crisis, we may experience the negative
effects of increased competitive pricing pressure and customer
turnover as well. We cannot assure you that worsening economic
conditions or a prolonged or recurring recession will not have a
significant adverse impact on our consolidated financial
condition, results of operations or cash flows. Further, we
cannot assure you that an improvement in economic conditions
will result in an immediate, or any, improvement in our
consolidated financial condition, results of operations or cash
flows.
The
downturn in the U.S. economy may expose us to credit risk for
amounts due from governmental agencies, large national accounts
and others.
The weak U.S. economy has reduced the amount of taxes
collected by various governmental agencies. We provide services
to a number of these agencies including numerous municipalities.
These governmental agencies may suffer financial difficulties
resulting from a decrease in tax revenue and may ultimately be
unable or unwilling to pay amounts owed to us. In addition, the
weak economy may cause other customers, including our large
national accounts, to suffer financial difficulties and
ultimately to be unable or unwilling to pay amounts owed to us.
This could have a negative impact on our consolidated financial
condition, results of operations and cash flows.
The
downturn in the U.S. economy and in the financial markets could
expose us to counter-party risk associated with our
derivatives.
To reduce our exposure to fluctuations in various commodities
and interest rates, we have entered into a number of derivative
agreements. These derivative agreements require us or the
counter-party to such agreements to
14
make payments to the other party if the price of certain
commodities or interest rates vary from a specified amount. A
continued downturn in the U.S. economy or in the financial
markets could adversely impact the financial stability of the
counter-parties with which we do business, potentially limiting
their ability to fulfill their obligations under our derivative
agreements. This could have a negative impact on our
consolidated financial condition, results of operations and cash
flows.
The
waste industry is highly competitive and includes competitors
that may have greater financial and operational resources,
flexibility to reduce prices and other competitive advantages
that could make it difficult for us to compete
effectively.
We principally compete with large national waste management
companies, municipalities and numerous regional and local
companies for collection and disposal accounts. Competition for
collection accounts is primarily based on price and the quality
of services. Competition for disposal business is primarily
based on disposal costs, geographic location and quality of
operations. Some of our competitors may have greater financial
and operational resources than us. Many counties and
municipalities that operate their own waste collection and
disposal facilities have the benefits of tax revenue or
tax-exempt financing. Our ability to obtain solid waste volume
for our landfills may also be limited by the fact that some
major collection companies also own or operate landfills to
which they send their waste. In markets in which we do not own
or operate a landfill, our collection operations may operate at
a disadvantage to fully integrated competitors. As a result of
these factors, we may have difficulty competing effectively from
time to time or in certain markets. If we were to lower prices
to address these competitive issues, it could negatively impact
our revenue growth and profitability.
Price
increases may not be adequate to offset the impact of increased
costs and may cause us to lose volume.
We seek to secure price increases necessary to offset increased
costs (including fuel and environmental costs), to improve
operating margins and to obtain adequate returns on our
substantial investments in assets such as our landfills. From
time to time, our competitors may reduce their prices in an
effort to expand their market share. Contractual, general
economic or market-specific conditions may also limit our
ability to raise prices. As a result, we may be unable to offset
increases in costs, improve our operating margins and obtain
adequate investment returns through price increases. We may also
lose volume to lower-cost competitors.
Increases
in the cost of fuel or petrochemicals will increase our
operating expenses, and we cannot assure you that we will be
able to recover fuel or oil cost increases from our
customers.
We depend on fuel to run our collection and transfer trucks and
other equipment used for collection, transfer, and disposal. We
buy fuel in the open market. Fuel prices are unpredictable and
can fluctuate significantly based on events beyond our control,
including geopolitical developments, actions by the Organization
of the Petroleum Exporting Countries and other oil and gas
producers, supply and demand for oil and gas, war, terrorism and
unrest in oil-producing countries, and regional production
patterns. We may not be able to offset such volatility through
fuel surcharges. For example, our fuel costs were
$349.8 million in 2009, representing 4.3% of our revenue
compared to $235.3 million in 2008, representing 6.4% of
our revenue. This decrease in fuel costs as a percent of revenue
primarily reflects a decrease in the price of fuel.
In order to manage our exposure to volatility in fuel prices, we
have entered into multiple swap agreements whereby we receive or
make payments to counter-parties if the price of fuel varies
from a specified amount. However, we do not hedge our entire
fuel usage. During 2009, only 6.4% of our fuel purchases were
hedged.
Over the last several years, regulations have been adopted
mandating the reduction of vehicle tail pipe emissions and, in
October 2009, the EPA indicated it will establish the first
U.S. standards for greenhouse gas emissions from
automobiles. The regulations could affect the type of fuel our
trucks use and could materially increase the cost and
consumption of our fuel. Our operations also require the use of
products (such as liners at our landfills) whose costs may vary
with the price of petrochemicals. An increase in the price of
petrochemicals could increase the cost of those products, which
would increase our operating and capital costs. We are also
susceptible to increases in indirect fuel surcharges from our
vendors.
15
Fluctuations
in prices for recycled commodities that we sell to customers may
adversely affect our consolidated financial condition, results
of operations and cash flows.
We process recyclable materials such as paper, cardboard,
plastics, aluminum and other metals for sale to third parties.
Our results of operations may be affected by changing prices or
market requirements for recyclable materials. The resale and
purchase prices of, and market demand for, recyclable materials
can be volatile due to changes in economic conditions and
numerous other factors beyond our control. These fluctuations
may affect our consolidated financial condition, results of
operations and cash flows.
Adverse
weather conditions may limit our operations and increase the
costs of collection and disposal.
Our collection and landfill operations could be adversely
impacted by extended periods of inclement weather, or by
increased severity of weather and climate extremes resulting in
the future from climate change, any of which could increase the
volume of waste collected under our existing contracts (without
corresponding compensation), interfere with collection and
landfill operations, delay the development of landfill capacity
or reduce the volume of waste generated by our customers. In
addition, adverse weather conditions may result in the temporary
suspension of our operations, which can significantly affect our
operating results in the affected regions during those periods.
We
currently have matters pending with the Internal Revenue Service
(the IRS), which could result in large cash
expenditures and could have a material adverse impact on our
operating results and cash flows.
We are currently under examination by the IRS with regard to
Allieds federal income tax returns for tax years 2007 and
2008, and Allieds 2000 through 2006 federal income tax
returns are at appeals. Republic is under audit for its 2007 and
2008 federal income tax returns, and under examination for its
2008 federal income tax return.
During its examination of Allieds 2002 tax year, the IRS
asserted that a 2002 redemption of four partnership interests in
waste-to-energy
businesses should have been recharacterized as disguised sale
transactions. This issue is currently before the Appeals
Division of the IRS. The Company believes its position is
supported by relevant technical authorities and strong business
purpose and we intend to vigorously defend our position on this
matter. The potential tax and interest through December 31,
2009 (to the extent unpaid) have been fully reserved in our
consolidated balance sheet. A disallowance would not materially
affect our consolidated results of operations; however, a
deficiency payment would adversely impact our cash flow in the
period the payment was made. The accrual of additional interest
charges through the time this matter is resolved will affect our
consolidated results of operations. In addition, the successful
assertion by the IRS of penalty and penalty-related interest in
connection with this matter could have a material adverse impact
on our consolidated financial condition, results of operations
and cash flows.
Additionally, during its examination of Allieds 2000
through 2003 tax years, the IRS proposed that certain landfill
costs be allocated to the collection and control of methane gas
that is naturally emitted from landfills. The IRS position
is that the methane gas emitted by a landfill constitutes a
joint product resulting from landfill operations and, therefore,
associated costs should not be expensed until the methane gas is
sold or otherwise disposed. We believe we have several
meritorious defenses, including the fact that methane gas is not
actively produced for sale by us but rather arises naturally in
the context of providing disposal services. Therefore, we
believe that the resolution of this issue will not have a
material adverse impact on our consolidated financial position,
results of operations or cash flows.
For additional information on these matters, see Note 10,
Income Taxes, to our consolidated financial statements in
Item 8 of our Annual Report on
Form 10-K
for the year ended December 31, 2009 and Note 8,
Income Taxes, to our unaudited consolidated financial
statements in Item 1 of our Quarterly Report on
Form 10-Q
for the quarter ended March 31, 2010.
Other matters may also arise in the course of tax audits that
could adversely impact our consolidated financial condition,
results of operations or cash flows.
16
We may
be unable to execute our financial strategy.
Our ability to execute our financial strategy depends on our
ability to maintain investment grade ratings on our senior debt.
The credit rating process is contingent upon a number of
factors, many of which are beyond our control. We cannot assure
you that we will be able to maintain our investment grade
ratings in the future. Our interest expense would increase and
our ability to obtain financing on favorable terms may be
adversely affected should we fail to maintain investment grade
ratings.
Our financial strategy is also dependent on our ability to
generate sufficient cash flow to reinvest in our existing
business, fund internal growth, acquire other solid waste
businesses, pay dividends, reduce indebtedness and minimize
borrowings, and take other actions to enhance shareholder value.
We cannot assure you that: we will be successful in executing
our broad-based pricing program; we will generate sufficient
cash flow to execute our financial strategy; we will be able to
pay cash dividends at our present rate, that we will be able to
increase the amount of such dividends, or that we will be able
to reinstitute our share repurchase program.
A
downgrade in our bond ratings could adversely affect our
liquidity by increasing the cost of debt and financial assurance
instruments.
While downgrades of our bond ratings may not have an immediate
impact on our cost of debt or liquidity, they may impact our
cost of debt and liquidity over the near to medium term. If the
rating agencies downgrade our debt, this may increase the
interest rate we must pay to issue new debt, and it may even
make it prohibitively expensive for us to issue new debt. If our
debt ratings are downgraded, future access to financial
assurance markets at a reasonable cost, or at all, also may be
adversely impacted.
The
solid waste industry is a capital-intensive industry and the
amount we spend on capital expenditures may exceed current
expectations, which could require us to obtain additional
funding for our operations or impair our ability to grow our
business.
Our ability to remain competitive and to grow and expand our
operations largely depends on our cash flow from operations and
access to capital. If our capital efficiency programs are unable
to offset the impact of inflation and business growth, it may be
necessary to increase the amount we spend. Additionally, if we
make acquisitions or further expand our operations, the amount
we expend on capital, capping, closure, post-closure and
environmental remediation expenditures will increase. Our cash
needs also will increase if the expenditures for capping,
closure, post-closure and remediation activities increase above
our current estimates, which may occur over a long period due to
changes in federal, state or local government requirements and
other factors beyond our control. Increases in expenditures
would negatively impact our cash flows.
Over the last several years, regulations have been adopted
mandating the reduction of vehicle tail pipe emissions. These
regulations have caused some increases in the costs of the
collection vehicles we buy. The EPA recently has indicated it
intends to adopt further regulations addressing greenhouse gas
emissions from automobiles. As a result, we could experience an
increase in capital costs. This also could cause an increase in
vehicle operating costs or a reduction in operating efficiency.
We may reduce the number of vehicles we purchase until
manufacturers adopt the new standards to increase efficiency.
We may
be unable to obtain or maintain required permits or to expand
existing permitted capacity of our landfills, which could
decrease our revenue and increase our costs.
We cannot assure you that we will successfully obtain or
maintain the permits we require to operate our business because
permits to operate non-hazardous solid waste landfills and to
expand the permitted capacity of existing landfills have become
more difficult and expensive to obtain and maintain. Permits
often take years to obtain as a result of numerous hearings and
compliance requirements with regard to zoning, environmental and
other regulations. These permits are also often subject to
resistance from citizen or other groups and other political
pressures. Local communities and citizen groups, adjacent
landowners or governmental agencies may oppose the issuance of a
permit or approval we may need, allege violations of the permits
under which we currently operate or laws or regulations to which
we are subject, or seek to impose liability on us for
environmental damage. Responding to these challenges has, at
times, increased our costs and extended the time associated with
establishing new
17
facilities and expanding existing facilities. In addition,
failure to receive regulatory and zoning approval may prohibit
us from establishing new facilities, maintaining permits for our
facilities or expanding existing facilities. Our failure to
obtain the required permits to operate our non-hazardous solid
waste landfills could have a material adverse impact on our
consolidated financial condition, results of operations and cash
flows. In addition, we may have to dispose collected waste at
landfills operated by our competitors or haul the waste long
distances at a higher cost to one of our landfills, either of
which could significantly increase our waste disposal costs.
The waste industry is subject to extensive government
regulation, and existing or future regulations may restrict our
operations, increase our costs of operations or require us to
make additional capital expenditures.
If we
inadequately accrue for landfill capping, closure and
post-closure costs, our financial condition and results of
operations may be adversely affected.
A landfill must be closed and capped, and post-closure
maintenance commenced, once the permitted capacity of the
landfill is reached and additional capacity is not authorized.
We have significant financial obligations relating to capping,
closure and post-closure costs at our existing owned or operated
landfills, and will have material financial obligations with
respect to any future owned or operated landfills. We establish
accruals for the estimated costs associated with capping,
closure and post-closure financial obligations. We could
underestimate such accruals, and our financial obligations for
capping, closure or post-closure costs could exceed the amount
accrued or amounts otherwise receivable pursuant to trust funds
established for this purpose. Such a shortfall could result in
significant unanticipated charges to income. Additionally, if a
landfill is required to be closed earlier than expected or its
remaining airspace is reduced for any other reason, the accruals
for capping, closure and post-closure could be required to be
accelerated, which could have a material adverse impact on our
consolidated financial condition, results of operations and cash
flows.
We
cannot assure you that we will continue to operate our landfills
at current volumes due to the use of alternatives to landfill
disposal caused by state requirements or voluntary
initiatives.
Most of the states in which we operate landfills require
counties and municipalities to formulate comprehensive plans to
reduce the volume of solid waste deposited in landfills through
waste planning, composting and recycling, or other programs.
Some state and local governments mandate waste reduction at the
source and prohibit the disposal of certain types of wastes,
such as yard waste, at landfills. Although such actions are
useful in protecting our environment, these actions, as well as
voluntary private initiatives by customers to reduce waste or
seek disposal alternatives, have and may in the future reduce
the volume of waste going to landfills in certain areas. If this
occurs, we cannot assure you that we will be able to operate our
landfills at their current volumes or charge current prices for
landfill disposal services due to the decrease in demand for
such services.
The
possibility of landfill and transfer station site development
projects, expansion projects or pending acquisitions not being
completed or certain other events could result in a material
charge to income.
We capitalize certain expenditures relating to development,
expansion and other projects. If a facility or operation is
permanently shut down or determined to be impaired, or a
development or expansion project is not completed or is
determined to be impaired, we will charge any unamortized
capitalized expenditures to income relating to such facility or
project that we are unable to recover through sale, transfer or
otherwise. In future periods, we may incur charges against
earnings in accordance with this policy, or other events may
cause impairments. Such charges could have a material adverse
impact on our consolidated financial condition, results of
operations and cash flows.
We are
subject to costly environmental regulations and flow-control
regulations that may affect our operating margins, restrict our
operations and subject us to additional liability.
Complying with laws and regulations governing the use,
treatment, storage, transfer and disposal of solid and hazardous
wastes and materials, air quality, water quality and the
remediation of contamination associated with the release of
hazardous substances is costly. Laws and regulations often
require us to enhance or replace our equipment and to modify
landfill operations or initiate final closure of a landfill. We
cannot assure you that we will be able to
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implement price increases sufficient to offset the costs of
complying with these laws and regulations. In addition,
environmental regulatory changes could accelerate or increase
expenditures for capping, closure and post-closure, and
environmental and remediation activities at solid waste
facilities and obligate us to spend sums in addition to those
presently accrued for such purposes.
Our collection, transfer, and landfill operations are, and may
in the future continue to be, affected by state or local laws or
regulations that restrict the transportation of solid waste
across state, county or other jurisdictional lines. Such laws
and regulations could negatively affect our operations,
resulting in declines in landfill volumes and increased costs of
alternate disposal.
In addition to the costs of complying with environmental
regulations, we incur costs to defend against litigation brought
by government agencies and private parties who may allege we are
in violation of our permits and applicable environmental laws
and regulations, or who assert claims alleging environmental
damage, personal injury or property damage. As a result, we may
be required to pay fines or implement corrective measures, or we
may have our permits and licenses modified or revoked. A
significant judgment against us, the loss of a significant
permit or license, or the imposition of a significant fine could
have a material adverse impact on our consolidated financial
condition, results of operations and cash flows. We establish
accruals for our estimates of the costs associated with our
environmental obligations. We could underestimate such accruals
and remediation costs could exceed amounts accrued. Such
shortfalls could result in significant unanticipated charges to
income.
Regulation
of greenhouse gas emissions could impose costs on our
operations, the magnitude of which we cannot yet
estimate.
Efforts to curtail the emission of greenhouse gases (GHGs), to
ameliorate the effect of climate change, continue to advance on
the federal, regional, and state level. Our landfill operations
emit methane, identified as a GHG. In June 2009, the
U.S. House of Representatives passed a bill that would
regulate GHGs comprehensively. While the centerpiece of that
bill would be a GHG emission allowance
cap-and-trade
system, landfills would not be compelled to hold allowances for
their GHG emissions. Rather, they would be subject to certain
further emission controls to be determined through
administrative rule-making. Senate passage of counterpart
legislation, and whether such legislation would treat landfills
in the same manner, is uncertain. Should comprehensive federal
climate change legislation be enacted, we expect it to impose
costs on our operations, the materiality of which we cannot
predict.
Absent comprehensive federal legislation to control GHG
emissions, EPA is moving ahead administratively under its
existing Clean Air Act authority. In October 2009, EPA published
a Proposed Prevention of Significant Deterioration and
Title V Greenhouse Gas Tailoring Rule (PSD tailoring
rule). The proposed rule would set new thresholds for GHG
emissions that define when Clean Air Act permits would be
required and would tailor these programs to limit
which facilities would be required to obtain permits. EPAs
legal authority to tailor this rule in the manner it
proposed has been challenged. If finalized as proposed, many of
our landfills would be subject to the PSD tailoring rule, which
could require permit amendments and additional emission
controls. In December 2009, EPA finalized its finding that six
GHGs endanger public health. While EPA made its finding in the
context of regulating air emissions from motor vehicles, other
Clean Air Act provisions appear to compel EPA to make comparable
findings for stationary sources, such as landfills. We cannot
predict the requirements or effective date of stationary source
rules that might apply to landfills as a result of this
endangerment finding and, accordingly, we cannot assure you that
further developments in this area will not have a material
effect on our landfill operations or on our consolidated
financial condition, results of operations or cash flows.
We may
have potential environmental liabilities that are not covered by
our insurance. Changes in insurance markets also may impact our
financial results.
We may incur liabilities for the deterioration of the
environment as a result of our operations. We maintain high
deductibles for our environmental liability insurance coverage.
If we were to incur substantial liability for environmental
damage, our insurance coverage may be inadequate to cover such
liability. This could have a material adverse impact on our
consolidated financial condition, results of operations and cash
flows.
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Also, due to the variable condition of the insurance market, we
may experience future increases in self- insurance levels as a
result of increased retention levels and increased premiums. As
we assume more risk for self- insurance through higher retention
levels, we may experience more variability in our self-insurance
reserves and expense.
Despite
our efforts, we may incur additional hazardous substances
liability in excess of amounts presently known and
accrued.
We are a potentially responsible party at many sites under
CERCLA, which provides for the remediation of contaminated
facilities and imposes strict, joint and several liability for
the cost of remediation on current owners and operators of a
facility at which there has been a release or a threatened
release of a hazardous substance, on parties who
were site owners and operators at the time hazardous substances
were disposed of, and on persons who arrange for the disposal of
such substances at the facility (i.e., generators of the waste
and transporters who selected the disposal site). Hundreds of
substances are defined as hazardous under CERCLA and
their presence, even in minute amounts, can result in
substantial liability. Notwithstanding our efforts to comply
with applicable regulations and to avoid transporting and
receiving hazardous substances, we may have additional liability
under CERCLA or similar laws in excess of our current reserves
because such substances may be present in waste collected by us
or disposed of in our landfills, or in waste collected,
transported or disposed of in the past by companies we have
acquired. Actual costs for these liabilities could be
significantly greater than amounts presently accrued for these
purposes, which could have a material adverse impact on our
consolidated financial position, results of operations and cash
flows.
Currently
pending or future litigation or governmental proceedings could
result in material adverse consequences, including judgments or
settlements.
We are, and from time to time become, involved in lawsuits,
regulatory inquiries, and governmental and other legal
proceedings arising out of the ordinary course of our business.
Many of these matters raise difficult and complicated factual
and legal issues and are subject to uncertainties and
complexities. The timing of the final resolutions to lawsuits,
regulatory inquiries, and governmental and other legal
proceedings is uncertain. Additionally, the possible outcomes or
resolutions to these matters could include adverse judgments or
settlements, either of which could require substantial payments,
adversely affecting our consolidated financial condition,
results of operations and cash flows.
We may
be unable to manage our growth effectively.
Our growth strategy places significant demands on our financial,
operational and management resources. To continue our growth, we
may need to add administrative and other personnel, and will
need to make additional investments in operations and systems.
We cannot assure you that we will be able to find and train
qualified personnel, or do so on a timely basis, or expand our
operations and systems to the extent, and in the time, required.
We may
be unable to execute our acquisition growth
strategy.
Our ability to execute our growth strategy depends in part on
our ability to identify and acquire desirable acquisition
candidates as well as our ability to successfully consolidate
acquired operations into our business. The consolidation of our
operations with those of acquired companies may present
significant challenges to our management. In addition,
competition among our competitors for acquisition candidates may
prevent us from acquiring certain acquisition candidates. As
such, we cannot assure you that:
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desirable acquisition candidates exist or will be identified;
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we will be able to acquire any of the candidates identified;
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we will effectively consolidate companies we acquire; or
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any acquisitions will be profitable or accretive to our earnings.
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If any of the aforementioned factors force us to alter our
growth strategy, our growth prospects could be adversely
affected.
Businesses
we acquire may have undisclosed liabilities.
In pursuing our acquisition strategy, our due diligence
investigations of the acquisition candidates may fail to
discover certain undisclosed liabilities of the acquisition
candidates. If we acquire a company having undisclosed
liabilities such as environmental, remediation or contractual,
as a successor owner we may be responsible for such undisclosed
liabilities. We expect to try to minimize our exposure to such
liabilities by conducting due diligence, by obtaining
indemnification from each of the sellers of the acquired
companies, by deferring payment of a portion of the purchase
price as security for the indemnification and by acquiring only
specified assets. However, we cannot assure you that we will be
able to obtain indemnification or that any indemnification
obtained will be enforceable, collectible or sufficient in
amount, scope or duration to fully offset any undisclosed
liabilities arising from our acquisitions.
Our
consolidated financial statements are based on estimates and
assumptions that may differ from actual results.
Our consolidated financial statements have been prepared in
accordance with U.S. GAAP and necessarily include amounts
based on estimates and assumptions made by management. Actual
results could differ from these amounts. Significant items
requiring management to make subjective or complex judgments
about matters that are inherently uncertain include the carrying
value of long-lived assets, the depletion and amortization of
landfill development costs, accruals for final capping, closure
and post-closure costs, valuation allowances for accounts
receivable and deferred tax assets, liabilities for potential
litigation, claims and assessments, and liabilities for
environmental remediation, employee benefit and pension plans,
deferred taxes, uncertain tax positions and self- insurance.
We cannot assure you that the liabilities recorded for landfill
and environmental costs will be adequate to cover the
requirements of existing environmental regulations, future
changes to or interpretations of existing regulations, or the
identification of adverse environmental conditions previously
unknown to management.
The
introduction of new accounting rules, laws or regulations could
adversely impact our results of operations.
Complying with new accounting rules, laws or regulations could
adversely impact our financial condition, results of operations
or cash flows, or cause unanticipated fluctuations in our
results of operations in future periods.
We may
be subject to workforce influences, including work stoppages,
which could increase our operating costs and disrupt our
operations.
As of December 31, 2009, approximately 27% of our workforce
was represented by various local labor unions. If our unionized
workers were to engage in a strike, work stoppage or other
slowdown, we could experience a significant disruption of our
operations and an increase in our operating costs, which could
have an adverse impact on our consolidated financial condition,
results of operations and cash flows. In addition, if a greater
percentage of our workforce becomes unionized, our business and
financial results could be materially and adversely impacted due
to the potential for increased operating costs.
Our
obligation to fund multi-employer pension plans to which we
contribute may have an adverse impact on us.
We contribute to at least 25 multi-employer pension plans
covering at least 17% of our current employees. We do not
administer these plans and generally are not represented on the
boards of trustees of these plans. The Pension Protection Act
enacted in 2006 (the PPA) requires under-funded pension plans to
improve their funding ratios. Based on the information available
to us, we believe that some of the multi-employer plans to which
we contribute are either critical or
endangered as those terms are defined in the PPA. We
cannot determine at this time the amount of additional funding,
if any, we may be required to make to these plans and,
therefore, have not recorded
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any related liabilities. However, plan assessments could have an
adverse impact on our results of operations or cash flows for a
given period. Furthermore, under current law, upon the
termination of a multi-employer pension plan, or in the event of
a withdrawal by us (which we consider from time to time) or a
mass withdrawal of contributing employers (each, a
Withdrawal Event), we would be required to make
payments to the plan for our proportionate share of the
plans unfunded vested liabilities. We cannot assure you
that there will not be a Withdrawal Event with respect to any of
the multi-employer pension plans to which we contribute or that,
in the event of such a Withdrawal Event, the amounts we would be
required to contribute would not have a material adverse impact
on our consolidated financial condition, results of operations
and cash flows.
The
costs of providing for pension benefits and related funding
requirements are subject to changes in pension fund values and
fluctuating actuarial assumptions, and may have a material
adverse impact on our results of operations and cash
flows.
We sponsor a defined benefit pension plan which is funded with
trustee assets invested in a diversified portfolio of debt and
equity securities. Our costs for providing such benefits and
related funding requirements are subject to changes in the
market value of plan assets. Our pension expenses and related
funding requirements are also subject to various actuarial
calculations and assumptions, which may differ materially from
actual results due to changing market and economic conditions,
interest rates and other factors. A significant increase in our
pension obligations and funding requirements could have a
material adverse impact on our consolidated financial condition,
results of operations and cash flows.
The
loss of key personnel could have a material adverse effect on
our consolidated financial condition, results of operations,
cash flows and growth prospects.
Our future success depends on the continued contributions of
several key employees and officers. The loss of the services of
key employees and officers, whether such loss is through
resignation or other causes, or the inability to attract
additional qualified personnel, could have a material adverse
effect on our financial condition, results of operations, cash
flows and growth prospects.
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RATIO OF
EARNINGS TO FIXED CHARGES
The following table shows our ratio of earnings to fixed charges
for the three months ended March 31, 2010 and for each of
the years ended December 31, 2009, 2008, 2007, 2006 and
2005. It should be noted that on December 5, 2008 we
acquired all the issued and outstanding shares of Allied in a
stock-for-stock
transaction for an aggregate purchase price of
$12.1 billion, which included approximately
$5.4 billion of debt, at fair value. For the purpose of
computing these ratios, the numerator, earnings, consists of
income from continuing operations before provision for income
taxes plus interest expense and an estimate of interest within
rent expense divided by the denominator, fixed charges, which
consists of interest expense including amounts capitalized and
an estimate of interest within rent expense.
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Three Months
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Ended
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March 31,
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Year Ended December 31,
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2010
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2009
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2008
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2007
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2006
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2005
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Ratio of earnings to fixed charges
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1.83
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2.39
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2.14
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5.63
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5.35
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5.72
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USE OF
PROCEEDS
The exchange offers are intended to satisfy our obligations
under the registration rights agreements for the unregistered
notes. We will not receive any cash proceeds from the issuance
of the exchange notes pursuant to the exchange offers. In
consideration for issuing the exchange notes as contemplated in
this prospectus, we will receive a like principal amount of the
unregistered notes, the terms of which are identical in all
material respects to the exchange notes, except as otherwise
noted in this prospectus. We will retire and cancel all of the
unregistered notes tendered in the exchange offers. Accordingly,
the issuance of the exchange notes will not result in any change
in our indebtedness or capitalization.
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THE
EXCHANGE OFFERS
Purpose
and Effect of Exchange Offers; Registration Rights
We and the guarantors entered into a registration rights
agreement with the initial purchasers of each series of
unregistered notes on September 8, 2009 (in the case of the
2019 notes), November 25, 2009 (in the case of the 2021
notes) and March 4, 2010 (in the case of the 2020 notes and
2040 notes), pursuant to which we and the guarantors agreed, to
the extent not prohibited by any applicable law or applicable
interpretations of the staff of the SEC, for the benefit of the
holders of the unregistered notes, that on or before
September 8, 2010 (in the case of the 2019 notes), or
November 25, 2010 (in the case of the 2020 notes, 2021
notes and 2040 notes), we would, at our own expense, use our
reasonable best efforts to:
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file a registration statement (which we refer to as an exchange
offer registration statement) with respect to a registered
exchange offer (which we refer to as an exchange offer) to
exchange the unregistered notes for new notes with terms
substantially identical in all material respects with the
unregistered notes (except that the exchange notes will not
contain transfer restrictions);
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cause the exchange offer registration statement to be declared
effective by the SEC under the Securities Act; and
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consummate the exchange offer.
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In addition, we agreed to keep each exchange offer open for at
least 20 business days after the date that we deliver notice of
the exchange offer to the holders of the unregistered notes and
to use our reasonable best efforts to cause each exchange offer
to be consummated not later than 60 days after the date on
which the exchange offer registration statement becomes
effective. The exchange notes are being offered under this
prospectus to satisfy our obligations under the registration
rights agreements.
If you participate in the exchange offers, you will, with
limited exceptions, receive exchange notes that are freely
tradable and not subject to restrictions on transfer. You should
read the information in this prospectus under the heading
Resale of Exchange Notes for more
information relating to your ability to transfer exchange notes.
No exchange offer is being made to, nor will we accept tenders
for exchange from, holders of unregistered notes in any
jurisdiction in which the exchange offer or the acceptance of
the exchange offer would not be in compliance with the
securities laws or blue sky laws of such jurisdiction.
If you are eligible to participate in an exchange offer and you
do not tender your unregistered notes as described in this
prospectus, you will not have any further registration rights.
In that case, your unregistered notes may continue to be subject
to restrictions on transfer under the Securities Act.
Shelf
Registration
In the registration rights agreements, we agreed that in the
event that:
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any changes in law or the applicable interpretations of the
staff of the SEC do not permit us to effect the applicable
exchange offer;
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for any other reason the applicable exchange offer is not
consummated on or before September 8, 2010 (in the case of
the 2019 notes), or November 25, 2010 (in the case of the
2020 notes, 2021 notes and 2040 notes);
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under certain circumstances, the initial purchasers shall so
request; or
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any holder of notes (other than the initial purchasers) is not
eligible to participate in the exchange offer,
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then we and the guarantors will, at our expense, (i) within
60 days after such filing obligation arises (but in no
event earlier than July 5, 2010 (in the case of the 2019
notes) or September 21, 2010 (in the case of the 2020
notes, 2021 notes and 2040 notes)), file with the SEC a shelf
registration statement covering resales of the unregistered
notes, (ii) use our reasonable best efforts to cause the
shelf registration statement to be declared effective within
120 days after such filing obligation arises (but in no
event earlier than September 8, 2010 (in the case of the
2019 notes), or November 25, 2010 (in the case of the 2020
notes, 2021 notes and 2040 notes)) and (iii) use our
reasonable best
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efforts to keep the shelf registration statement effective for a
period of at least one year following the effective date of such
shelf registration statement (or shorter period that will
terminate when all the notes covered by such shelf registration
statement have been sold pursuant to such shelf registration
statement).
We will, in the event of the filing of the shelf registration
statement, provide to each holder of the unregistered notes
copies of the prospectus which is a part of the shelf
registration statement, notify each such holder when the shelf
registration statement has become effective and take certain
other actions as are required to permit unrestricted resales of
the unregistered notes. A holder of unregistered notes that
sells its unregistered notes pursuant to the shelf registration
statement generally (a) will be required to be named as a
selling security holder in the related prospectus and to deliver
a prospectus to purchasers, (b) will be subject to certain
of the civil liability provisions under the Securities Act in
connection with such sales and (c) will be bound by the
provisions of the registration rights agreement that are
applicable to such a holder (including certain indemnification
rights and obligations thereunder). In addition, each holder of
the unregistered notes will be required to deliver information
to be used in connection with the shelf registration statement
and to provide comments on the shelf registration statement
within the time periods set forth in the registration rights
agreement to have their unregistered notes included in the shelf
registration statement and to benefit from the provisions
regarding additional interest described below.
Additional
Interest
If we have not exchanged the exchange notes for all unregistered
notes validly tendered in accordance with the terms of an
exchange offer on or before September 8, 2010 (in the case
of the 2019 notes), or November 25, 2010 (in the case of
the 2020 notes, 2021 notes and 2040 notes), or, if applicable, a
shelf registration statement covering resales of the
unregistered notes has not been filed within 60 days of the
date such obligation arises (but in no event earlier than
July 5, 2010 (in the case of the 2019 notes) or
September 21, 2010 (in the case of the 2020 notes, 2021
notes and 2040 notes)), or the shelf registration statement has
not been declared effective within 120 days of the date
such obligation arises (but in no event earlier than
September 8, 2010 (in the case of the 2019 notes), or
November 25, 2010 (in the case of the 2020 notes, 2021
notes and 2040 notes)), or such shelf registration statement
ceases to be effective at any time during the shelf registration
period, then, upon the occurrence of any of such events,
additional interest shall accrue on the principal amount of the
unregistered notes at a rate of 0.25% per annum for the first
90-day
period immediately following such date and by an additional
0.25% per annum with respect to each subsequent
90-day
period, up to a maximum additional rate of 1.0% per annum
thereafter, until the exchange offer is completed, the shelf
registration statement is filed or declared effective or, if
such shelf registration statement ceased to be effective, again
becomes effective.
The exchange offers are intended to satisfy our exchange offer
obligations under the registration rights agreements. The
exchange notes will not have rights to additional interest as
set forth above, upon the consummation of the applicable
exchange offer. The above summary of the registration rights
agreements is not complete and is subject to, and qualified by
reference to, all the provisions of the applicable registration
rights agreement. A copy of each registration rights agreement
is an exhibit to the registration statement that includes this
prospectus.
Terms of
the Exchange Offers
Upon the terms and subject to the conditions set forth in this
prospectus and in the accompanying letter of transmittal, we are
offering to exchange $1,000 principal amount of exchange notes
for each $1,000 principal amount of the applicable series of
unregistered notes. You may tender some or all of your
unregistered notes only in minimum denominations of $2,000 and
larger integral multiples of $1,000. As of the date of this
prospectus, $850,000,000 aggregate principal amount of the
unregistered 5.00% notes due 2020, $600,000,000 aggregate
principal amount of the unregistered 5.25% notes due 2021,
$650,000,000 aggregate principal amount of the unregistered
5.50% notes due 2019 and $650,000,000 aggregate principal
amount of the unregistered 6.20% notes due 2040 notes are
outstanding.
The terms of each series of the exchange notes to be issued are
substantially similar to the applicable series of unregistered
notes, except that the offering of the exchange notes will have
been registered under the Securities Act and, therefore, the
certificates for the exchange notes will not bear legends
restricting their transfer. In addition, the exchange notes will
not have registration rights and will not have rights to
additional interest. Each series of
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exchange notes will be issued under and be entitled to the
benefits of the applicable indenture pursuant to which the
applicable series of unregistered notes were issued.
In connection with the issuance of the unregistered notes, we
arranged for the unregistered notes to be issued and
transferable in book-entry form through the facilities of DTC.
The exchange notes will also be issuable and transferable in
book-entry form through DTC.
There will be no fixed record date for determining the eligible
holders of the unregistered notes that are entitled to
participate in the exchange offers. We will be deemed to have
accepted for exchange validly tendered unregistered notes when
and if we have given oral (promptly confirmed in writing) or
written notice of acceptance to the applicable exchange agent.
The applicable exchange agent will act as agent for the
tendering holders of unregistered notes for the purpose of
receiving exchange notes from us and delivering them to such
holders.
If any tendered unregistered notes are not accepted for exchange
because of an invalid tender or the occurrence of certain other
events described herein, certificates for any such unaccepted
unregistered notes will be returned, without expenses, to the
tendering holder thereof promptly after the expiration of the
applicable exchange offer.
Holders of unregistered notes who tender in an exchange offer
will not be required to pay brokerage commissions or fees or,
subject to the instructions in the letter of transmittal,
transfer taxes with respect to the exchange of unregistered
notes for exchange notes pursuant to an exchange offer. We will
pay all charges and expenses, other than certain applicable
taxes, in connection with the exchange offers. It is important
that you read the section Fees and Expenses below
for more details regarding fees and expenses incurred in the
exchange offers.
Any unregistered notes which holders do not tender or which we
do not accept in the exchange offers will remain outstanding and
continue to accrue interest and may be subject to restrictions
on transfer under the Securities Act. We will not have any
obligation to register the offer or sale of such unregistered
notes under the Securities Act. Holders wishing to transfer
unregistered notes would have to rely on exemptions from the
registration requirements of the Securities Act.
Conditions
of the Exchange Offers
You must tender your unregistered notes in accordance with the
requirements of this prospectus and the letter of transmittal in
order to participate in the exchange offers. Notwithstanding any
other provision of any exchange offer, or any extension of any
exchange offer, we will not be required to accept for exchange
any unregistered notes, and may amend or terminate any exchange
offer if:
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the applicable exchange offer, or the making of any exchange by
a holder of unregistered notes, violates applicable law or any
applicable interpretation of the staff of the SEC;
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any action or proceeding shall have been instituted or
threatened with respect to the applicable exchange offer which,
in our reasonable judgment, would impair our ability to proceed
with the exchange offer; and
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any law, rule or regulation or applicable interpretations of the
staff of the SEC have been issued or promulgated, which, in our
good faith determination, does not permit us to effect the
applicable exchange offer.
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Expiration
Date; Extensions; Amendment; Termination
The exchange offers will expire at 5:00 p.m., New York City
time, on August 2, 2010, unless we, in our sole discretion,
extend any of them. In the case of any extension, we will notify
the applicable exchange agent orally (promptly confirmed in
writing) or in writing of any extension. We will also notify the
registered holders of the applicable unregistered notes of the
extension no later than 9:00 a.m., New York City time, on
the business day after the previously scheduled expiration of
the exchange offer.
To the extent we are legally permitted to do so, we expressly
reserve the right, in our sole discretion, to:
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delay accepting any unregistered senior note due to an extension
of the exchange offer;
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waive any condition of any exchange offer; and
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amend the terms of any exchange offer in any manner.
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We will give oral or written notice of any non-acceptance or
amendment to the registered holders of the applicable
unregistered notes as promptly as practicable. If we consider an
amendment to an exchange offer to be material, we will promptly
inform the registered holders of the applicable unregistered
notes of such amendment in a reasonable manner.
If we determine, in our sole discretion, that any of the events
or conditions described in Conditions of the
Exchange Offers has occurred, we may terminate any
exchange offer. We may:
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refuse to accept any unregistered notes and return to the
holders any unregistered notes that have been tendered;
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extend the exchange offer and retain all unregistered notes
tendered prior to the expiration of the exchange offer, subject
to the rights of the holders to withdraw their tendered
unregistered notes; or
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waive the condition with respect to the exchange offer and
accept all properly tendered unregistered notes that have not
been withdrawn.
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If any such waiver constitutes a material change in any exchange
offer, we will disclose the change by means of a supplement to
this prospectus that will be distributed to each registered
holder of the applicable unregistered notes, and we will extend
the exchange offer for a period of five to ten business days,
depending upon the significance of the waiver and the manner of
disclosure to the registered holders of the applicable
unregistered notes, if the exchange offer would otherwise expire
during that period.
Any determination by us concerning the events described above
will be final and binding upon the parties. Without limiting the
manner by which we may choose to make public announcements of
any extension, delay in acceptance, amendment or termination of
an exchange offer, we will have no obligation to publish,
advertise, or otherwise communicate any public announcement,
other than by making a timely release to a financial news
service.
Interest
on the Exchange Notes
We will pay interest on the exchange notes semi-annually on
March 1 and September 1, commencing September 1, 2010
(in the case of the 2020 exchange notes and 2040 exchange
notes), May 15 and November 15, commencing November 15,
2010 (in the case of the 2021 exchange notes), and March 15 and
September 15, commencing September 15, 2010 (in the
case of the 2019 exchange notes). Holders of unregistered notes
whose unregistered notes are accepted for exchange in the
exchange offers will be deemed to have waived the right to
receive any payment in respect of interest on the unregistered
notes accrued from the date of issuance or the last interest
payment date, as applicable. Consequently, holders who exchange
their unregistered notes for exchange notes will receive the
same interest payment on the next interest payment date with
respect to the unregistered notes and the first interest payment
date with respect to the exchange notes following consummation
of the exchange offers that they would have received if they had
not accepted the exchange offer.
Resale of
Exchange Notes
Under existing interpretations of the Securities Act by the SEC
contained in several no action letters to third parties, and
subject to the immediately following sentence, we believe that
the exchange notes would generally be freely transferable by
holders thereof after the exchange offer without further
registration under the Securities Act (subject to certain
representations required to be made by each holder of
unregistered notes, as set forth below). However, any purchaser
of notes who is an affiliate of us or any guarantor
and any purchaser of notes who intends to participate in any
exchange offer for the purpose of distributing the exchange
notes:
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will not be able to rely on the interpretation of the staff of
the SEC;
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will not be able to tender its unregistered notes in any
exchange offer; and
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must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any sale
or transfer of the notes unless such sale or transfer is made
pursuant to an exemption from such requirements.
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In addition, in connection with any resales of exchange notes,
any broker dealer, which we refer to as a Participating Broker
Dealer, which acquired the unregistered notes for its own
account as a result of market making or other trading activities
must deliver a prospectus meeting the requirements of the
Securities Act. The SEC has taken the position that
Participating Broker Dealers may fulfill their prospectus
delivery requirements with respect to the exchange notes with
this prospectus. If we receive notice from one or more
Participating Broker Dealers in connection with an exchange
offer or within 20 days after consummation of the exchange
offer that such Participating Broker Dealer is exchanging or has
exchanged notes acquired for the account of such Participating
Broker Dealer as a result of market-making or other trading
activities, we will agree to make available for a period of up
to 180 days after consummation of the exchange offer a
prospectus meeting the requirements of the Securities Act to any
Participating Broker Dealer and any other persons with similar
prospectus delivery requirements for use in connection with any
resale of exchange notes. A Participating Broker Dealer or any
other person that delivers such a prospectus to purchasers in
connection with such resales will be subject to certain of the
civil liability provisions under the Securities Act and will be
bound by the provisions of the registration rights agreement
(including certain indemnification rights and obligations
thereunder).
Each holder of the unregistered notes who wishes to exchange
their notes for exchange notes in an exchange offer will be
required to make certain representations, including
representations that:
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any exchange notes to be received by it will be acquired in the
ordinary course of its business;
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it has no arrangement or understanding with any person to
participate in the distribution (within the meaning of the
Securities Act) of the exchange notes; and
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it is not an affiliate (as defined in Rule 405
under the Securities Act) of us or any guarantor.
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Upon consummation of the exchange offer, the exchange notes will
have different CUSIP and ISIN numbers from the unregistered
notes.
Procedures
for Tendering
The term holder with respect to the exchange offers
means any person in whose name unregistered notes are registered
on our agents books or any other person who has obtained a
properly completed bond power from the registered holder, or any
person whose unregistered notes are held of record by DTC who
desires to deliver such unregistered notes by book-entry
transfer at DTC.
Except in limited circumstances, only a DTC participant listed
on a DTC notes position listing with respect to the applicable
unregistered notes may tender its unregistered notes in an
exchange offer. To tender unregistered notes in an exchange
offer:
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holders of unregistered notes that are DTC participants may
follow the procedures for book-entry transfer as provided for
below under Book-Entry Transfer and in
the letter of transmittal.
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In addition:
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the applicable exchange agent must receive any corresponding
certificate or certificates representing the applicable
unregistered notes along with the letter of transmittal; or
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the applicable exchange agent must receive, before expiration of
the applicable exchange offer, a timely confirmation of
book-entry transfer of applicable unregistered notes into the
applicable exchange agents account at DTC according to
standard operating procedures for electronic tenders described
below and a properly transmitted agents message described
below.
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The tender by a holder of unregistered notes will constitute an
agreement between such holder and us in accordance with the
terms and subject to the conditions set forth in this prospectus
and in the letter of transmittal. If less than all the
unregistered notes held by a holder of unregistered notes are
tendered, a tendering holder should fill
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in the amount of unregistered notes being tendered in the
specified box on the letter of transmittal. The entire amount of
unregistered notes delivered to the applicable exchange agent
will be deemed to have been tendered unless otherwise indicated.
The method of delivery of unregistered notes, the letter of
transmittal and all other required documents or transmission of
an agents message, as described under
Book Entry Transfer, to the applicable
exchange agent is at the election and risk of the holder.
Instead of delivery by mail, we recommend that holders use an
overnight or hand delivery service. In all cases, sufficient
time should be allowed to assure timely delivery prior to the
expiration of the applicable exchange offer. No letter of
transmittal or unregistered notes should be sent to us but must
instead be delivered to the applicable exchange agent. Delivery
of documents to DTC in accordance with their procedures will not
constitute delivery to the applicable exchange agent.
If you are a beneficial owner of unregistered notes that are
registered in the name of a broker, dealer, commercial bank,
trust company or other nominee and you wish to tender your
unregistered notes, you should contact the registered holder
promptly and instruct the registered holder to tender on your
behalf. If you wish to tender on your own behalf, you must,
prior to completing and executing the letter of transmittal and
delivering your unregistered notes, either:
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make appropriate arrangements to register ownership of the
unregistered notes in your name; or
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obtain a properly completed bond power from the registered
holder.
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The transfer of record ownership may take considerable time and
might not be completed prior to the expiration date.
Signatures on a letter of transmittal or a notice of withdrawal
as described in Withdrawal of Tenders
below, as the case may be, must be guaranteed by a member firm
of a registered national securities exchange or the Financial
Industry Regulatory Authority, Inc., a commercial bank or trust
company having an office or correspondent in the United States
or an eligible guarantor institution within the
meaning of
Rule 17Ad-15
under the Exchange Act, unless the unregistered notes tendered
pursuant thereto are tendered:
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by a registered holder who has not completed the box entitled
Special Registration Instructions or Special
Delivery Instructions in the letter of transmittal; or
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for the account of an eligible institution.
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If the letter of transmittal is signed by a person other than
the registered holder of any unregistered notes listed therein,
the applicable unregistered notes must be endorsed or
accompanied by appropriate bond powers which authorize the
person to tender the applicable unregistered notes on behalf of
the registered holder, in either case signed as the name of the
registered holder or holders appears on the applicable
unregistered notes. If the letter of transmittal or any
unregistered notes or bond powers are signed by trustees,
executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when
signing and, unless waived by us, evidence satisfactory to us of
their authority to so act must be submitted with the letter of
transmittal.
We will determine in our sole discretion all the questions as to
the validity, form, eligibility (including time of receipt),
acceptance and withdrawal of the tendered unregistered notes.
Our determinations will be final and binding. We reserve the
absolute right to reject any and all unregistered notes not
validly tendered or any unregistered notes the acceptance of
which would, in the opinion of our counsel, be unlawful. We
reserve the absolute right to waive any irregularities or
conditions of tender as to particular unregistered notes;
provided that any waiver of a condition of tender will apply to
all unregistered notes and not only to particular unregistered
notes. Our interpretation of the terms and conditions of the
exchange offers (including the instructions in the letter of
transmittal) will be final and binding on all parties. Unless
waived, any defects or irregularities in connection with tenders
of unregistered notes must be cured within such time as we will
determine. However, all conditions must be satisfied or waived
prior to the expiration of the exchange offer (as extended, if
applicable). Neither we, the applicable exchange agent nor any
other person shall be under any duty to give notification of
defects or irregularities with respect to tenders of
unregistered notes nor shall any of them incur any liability for
failure to give such notification. Tenders of unregistered notes
will not be deemed to have been made until such
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irregularities have been cured or waived. Any unregistered notes
received by the applicable exchange agent that are not properly
tendered and as to which the defects or irregularities have not
been cured or waived will be returned without cost by the
applicable exchange agent to the tendering holder of such
unregistered notes, unless otherwise provided in the letter of
transmittal, promptly following the expiration date of the
exchange offer.
In addition, we reserve the right in our sole discretion to
(1) purchase or make offers for any unregistered notes that
remain outstanding subsequent to the expiration date, and
(2) to the extent permitted by applicable law, purchase
unregistered notes in the open market, in privately negotiated
transactions or otherwise. The terms of any such purchases or
offers may differ from the terms of the exchange offers.
Book-Entry
Transfer
We understand that the applicable exchange agent will make a
request promptly after the date of this document to establish an
account with respect to the applicable unregistered notes at DTC
for the purpose of facilitating the applicable exchange offer.
Any financial institution that is a participant in DTCs
system may make book-entry delivery of unregistered notes by
causing DTC to transfer such unregistered notes into the
applicable exchange agents DTC account in accordance with
DTCs Automated Tender Offer Program procedures for such
transfer. The exchange for tendered unregistered notes will only
be made after a timely confirmation of a book-entry transfer of
the unregistered notes into the applicable exchange agents
account at DTC, and timely receipt by the applicable exchange
agent of an agents message.
The term agents message means a message,
transmitted by DTC and received by the applicable exchange agent
and forming part of the confirmation of a book-entry transfer,
which states that DTC has received an express acknowledgment
from a participant tendering unregistered notes and that such
participant has received an appropriate letter of transmittal
and agrees to be bound by the terms of the letter of
transmittal, and we may enforce such agreement against the
participant. Delivery of an agents message will also
constitute an acknowledgment from the tendering DTC participant
that the representations contained in the appropriate letter of
transmittal and described above are true and correct.
Withdrawal
of Tenders
Except as otherwise provided herein, tenders of unregistered
notes may be withdrawn at any time prior to 5:00 p.m., New
York City time, on August 2, 2010, the expiration date of
the exchange offers.
For a withdrawal to be effective:
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the applicable exchange agent must receive a written notice of
withdrawal, which may be by facsimile transmission or letter, at
the applicable address set forth below under Exchange
Agent; or
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for DTC participants, holders must comply with their respective
standard operating procedures for electronic tenders and the
applicable exchange agent must receive an electronic notice of
withdrawal from DTC.
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Any notice of withdrawal must:
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specify the name of the person who tendered the unregistered
notes to be withdrawn;
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identify the unregistered notes to be withdrawn, including the
certificate number or numbers and principal amount to be
withdrawn;
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be signed by the person who tendered the unregistered notes in
the same manner as the original signature on the letter of
transmittal, including any required signature
guarantees; and
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specify the name in which the unregistered notes are to be
re-registered, if different from that of the withdrawing holder.
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If unregistered notes have been tendered pursuant to the
procedure for book-entry transfer described above, any notice of
withdrawal must specify the name and number of the account at
DTC to be credited with the withdrawn unregistered notes and
otherwise comply with the procedures of the facility. We will
determine all questions as to the validity, form and eligibility
(including time of receipt) for such withdrawal notices, and our
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determination shall be final and binding on all parties. Any
unregistered notes so withdrawn will be deemed not to have been
validly tendered for purposes of the exchange offers, and no
exchange notes will be issued with respect thereto unless the
unregistered notes so withdrawn are validly re-tendered.
Properly withdrawn unregistered notes may be re-tendered by
following the procedures described above under Procedures
for Tendering at any time prior to the expiration of the
applicable exchange offer.
Consequences
of Failure to Exchange
If you do not tender your unregistered notes to be exchanged in
the exchange offers, they will remain restricted
securities within the meaning of Rule 144(a)(3) of
the Securities Act.
Accordingly, they:
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may be resold only if (1) registered pursuant to the
Securities Act, (2) an exemption from registration is
available or (3) neither registration nor an exemption is
required by law; and
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shall continue to bear a legend restricting transfer in the
absence of registration or an exemption therefrom.
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As a result of the restrictions on transfer of the unregistered
notes, as well as the availability of the exchange notes, the
unregistered notes are likely to be much less liquid than before
the exchange offers.
Exchange
Agents
U.S. Bank National Association has been appointed as the
exchange agent for the 2020 exchange notes, 2021 exchange notes
and 2040 exchange notes. The Bank of New York Mellon
Trust Company, N.A., has been appointed as the exchange
agent for the 2019 exchange notes. Questions and requests for
assistance relating to the exchange of the unregistered notes
should be directed to the applicable exchange agent addressed as
follows:
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In the case of the 2020
exchange notes, 2021
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exchange notes and 2040 exchanges notes:
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In the case of the 2019 exchange notes:
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By Mail:
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By Mail:
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U.S. Bank National Association
West Side Flats Operations Center
Attn: Rachel Muehlbauer
60 Livingston Avenue
St. Paul, MN 55107
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The Bank of New York Mellon Corporation
Corporate Trust Operations
Reorganization Unit
101 Barclay Street - 7 East
New York, NY 10286
Attn: Ms. Diane Amoroso
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By Overnight Mail or Courier:
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By Overnight Mail or Courier:
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U.S. Bank National Association
West Side Flats Operations Center
Attn: Rachel Muehlbauer
60 Livingston Avenue
St. Paul, MN 55107
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The Bank of New York Mellon Corporation
Corporate Trust Operations
Reorganization Unit
101 Barclay Street - 7 East
New York, NY 10286
Attn: Ms. Diane Amoroso
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By Facsimile (for Eligible Institutions Only):
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By Facsimile (for Eligible Institutions Only):
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(651) 495-8158
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(212) 298-1915
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For Information or Confirmation by Telephone:
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For Information or Confirmation by Telephone:
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(651) 495-3511
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(212) 815-2742
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Fees and
Expenses
We will bear the expenses of soliciting tenders pursuant to the
exchange offers. The principal solicitation for tenders pursuant
to the exchange offers is being made by mail. Additional
solicitations may be made by our officers and regular employees
and our affiliates in person or by telephone.
We will not make any payments to brokers, dealers or other
persons soliciting acceptances of the exchange offers. We,
however, will pay the exchange agents reasonable and customary
fees for its services and will reimburse
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each of the exchange agents for its related reasonable
out-of-pocket
expenses and accounting and legal fees. We may also pay
brokerage houses and other custodians, nominees and fiduciaries
the reasonable
out-of-pocket
expenses incurred by them in forwarding copies of this
prospectus, letters of transmittal and related documents to the
beneficial owners of the unregistered notes and in handling or
forwarding tenders for exchange.
We will pay all transfer taxes, if any, applicable to the
exchange of unregistered notes pursuant to the exchange offers.
The tendering holder, however, will be required to pay any
transfer taxes, whether imposed on the registered holder or any
other person, if:
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certificates representing exchange notes or unregistered notes
for principal amounts not tendered or accepted for exchange are
to be delivered to, or are to be registered or issued in the
name of, any person other than the registered holder of the
notes tendered;
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tendered notes are registered in the name of any person other
than the person signing the letter of transmittal; or
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a transfer tax is imposed for any reason other than the exchange
of unregistered notes under the exchange offer.
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If satisfactory evidence of payment of such taxes or exemption
therefrom is not submitted with the letter of transmittal, the
amount of such transfer taxes will be billed directly to such
tendering holder.
Accounting
Treatment
We will record the exchange notes in our accounting records at
the same carrying value as the unregistered notes, which is the
aggregate principal amount as reflected in our accounting
records on the date of applicable exchange. Accordingly, we will
not recognize any gain or loss for accounting purposes upon the
consummation of the exchange offers. The exchange offers costs
will be amortized as part of deferred financing costs over the
life of the notes.
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DESCRIPTION
OF THE EXCHANGE NOTES
General
The 2020 exchange notes, 2021 exchange notes and 2040 exchange
notes will be issued under an indenture, dated as of
November 25, 2009, as supplemented by the First
Supplemental Indenture, dated as of November 25, 2009, the
Second Supplemental Indenture and the Third Supplemental
Indenture, each dated March 4, 2010, among the Company, as
issuer, the guarantors named therein and U.S. Bank National
Association, as trustee (collectively, the U.S. Bank
Indenture). The 2019 exchange notes will be issued under
an indenture, dated as of September 8, 2009, as
supplemented by the First Supplemental Indenture, dated as of
September 8, 2009, among the Company, as issuer, the
guarantors named therein and The Bank of New York Mellon
Trust Company, N.A., as trustee (the BNY Mellon
Indenture, and together with the U.S. Bank Indenture,
the indentures). The term notes refers
collectively to the exchange notes and the unregistered notes.
In the discussion that follows, we summarize the material
provisions of the indenture. Whenever particular provisions or
defined terms in the indenture are referred to in this offering
memorandum, these provisions or defined terms are incorporated
by reference in this offering memorandum. References, in this
section only, to the Company refer to Republic
Services, Inc., exclusive of our subsidiaries. Since our
discussion of indenture provisions is only a summary, the
Company urges you to read the applicable indenture because it,
and not this description, defines your rights as a holder of the
notes. The indentures have been filed as exhibits to the
registration statement that includes this prospectus. See
Where You Can Find More Information.
Maturity,
Principal and Interest
The 2020 exchange notes will:
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be the Companys unsecured unsubordinated obligations;
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rank equally with all of the Companys other unsecured and
unsubordinated indebtedness from time to time outstanding;
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be senior to any of the Companys subordinated indebtedness
from time to time outstanding;
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rank junior to the Companys secured indebtedness from time
to time outstanding to the extent of the value of the assets
securing such indebtedness;
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be effectively junior in right of payment to all existing and
future liabilities, including trade payables, of those of the
Companys domestic subsidiaries that do not guarantee the
notes and of any of the Companys foreign subsidiaries,
which will not guarantee the notes;
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be initially limited to $850 million aggregate principal
amount;
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be issued in registered form in minimum denominations of $2,000
and in integral multiples of $1,000;
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mature on March 1, 2020; and
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bear interest at a rate of 5.00% per annum, payable semiannually
in arrears on March 1 and September 1 in each year (the
2020 interest payment dates), commencing on
September 1, 2010, to the person in whose name the note (or
any predecessor note) is registered at the close of business on
the February 15 or August 15 immediately preceding the relevant
interest payment date.
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The 2021 exchange notes will:
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be the Companys unsecured unsubordinated obligations;
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rank equally with all of the Companys other unsecured and
unsubordinated indebtedness from time to time outstanding;
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be senior to any of the Companys subordinated indebtedness
from time to time outstanding;
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rank junior to the Companys secured indebtedness from time
to time outstanding to the extent of the value of the assets
securing such indebtedness;
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be effectively junior in right of payment to all existing and
future liabilities, including trade payables, of those of the
Companys domestic subsidiaries that do not guarantee the
notes and of any of the Companys foreign subsidiaries,
which will not guarantee the notes;
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be initially limited to $600 million aggregate principal
amount;
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be issued in registered form in minimum denominations of $2,000
and in integral multiples of $1,000;
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mature on November 15, 2021; and
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bear interest at a rate of 5.25% per annum, payable semiannually
in arrears on May 15 and November 15 in each year (the
2021 interest payment dates), commencing November
15, 2010, to the person in whose name the note (or any
predecessor note) is registered at the close of business on the
May 1 or November 1 immediately preceding the relevant interest
payment date.
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The 2019 exchange notes will:
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be the Companys unsecured unsubordinated obligations;
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rank equally with all of the Companys other unsecured and
unsubordinated indebtedness from time to time outstanding;
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be senior to any of the Companys subordinated indebtedness
from time to time outstanding;
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rank junior to the Companys secured indebtedness from time
to time outstanding to the extent of the value of the assets
securing such indebtedness;
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be effectively junior in right of payment to all existing and
future liabilities, including trade payables, of those of the
Companys domestic subsidiaries that do not guarantee the
notes and of any of the Companys foreign subsidiaries,
which will not guarantee the notes;
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be initially limited to $650 million aggregate principal
amount;
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be issued in registered form in minimum denominations of $2,000
and in integral multiples of $1,000;
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mature on September 15, 2019; and
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bear interest at a rate of 5.50% per annum, payable semiannually
in arrears on March 15 and September 15 in each year (the
2019 interest payment dates), commencing on
September 15, 2010, to the person in whose name the note
(or any predecessor note) is registered at the close of business
on the March 1 or September 1 immediately preceding the relevant
interest payment date.
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The 2040 exchange notes will:
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be the Companys unsecured unsubordinated obligations;
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rank equally with all of the Companys other unsecured and
unsubordinated indebtedness from time to time outstanding;
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be senior to any of the Companys subordinated indebtedness
from time to time outstanding;
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rank junior to the Companys secured indebtedness from time
to time outstanding to the extent of the value of the assets
securing such indebtedness;
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be effectively junior in right of payment to all existing and
future liabilities, including trade payables, of those of the
Companys domestic subsidiaries that do not guarantee the
notes and of any of the Companys foreign subsidiaries,
which will not guarantee the notes;
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be initially limited to $650 million aggregate principal
amount;
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be issued in registered form in minimum denominations of $2,000
and in integral multiples of $1,000;
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mature on March 1, 2040; and
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bear interest at a rate of 6.20% per annum, payable semiannually
in arrears on March 1 and September 1 in each year (the
2040 interest payment dates, and together with each
of the 2020 interest payment dates, 2021 interest payment dates
and 2019 interest payment dates, an interest payment
date), commencing on September 1, 2010, to the person
in whose name the note (or any predecessor note) is registered
at the close of business on the February 15 or August 15
immediately preceding the relevant interest payment date.
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Additional notes of the same class and series may be issued in
one or more tranches from time to time, without notice to or the
consent of the existing holders of the notes. Additional notes
of the same class and series may not be fungible with the 2020
exchange notes, the 2021 exchange notes, the 2019 exchange notes
and or the 2040 exchange notes for federal income tax purposes.
Interest will be computed on the basis of a
360-day year
comprised of twelve
30-day
months.
Guarantees
The notes initially will be guaranteed, fully and
unconditionally and jointly and severally, by all of the
Companys subsidiaries that guarantee the Companys
revolving credit facilities. Each guarantee will be a senior
obligation of the guarantor, will rank equally with all
unsecured and unsubordinated indebtedness of the guarantor from
time to time outstanding, will rank senior to any subordinated
indebtedness of the guarantor from time to time outstanding and
will rank junior to any secured indebtedness of a guarantor from
time to time outstanding to the extent of the value of the
assets securing such indebtedness.
In accordance with the terms of the applicable indenture, each
guarantee of a guarantor will be released in the following
circumstances:
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concurrently with the satisfaction and discharge of the
applicable indenture in accordance with the terms of the
applicable indenture;
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concurrently with the defeasance or covenant defeasance of the
applicable notes in accordance with the terms of the applicable
indenture;
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upon the consummation of any transaction (whether involving a
sale or other disposition of securities, a merger or otherwise)
whereby the guarantor ceases to be a Subsidiary of the
Company; or
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upon the termination of such guarantors obligations under
its guarantees provided with respect to the Companys
revolving credit facilities, or upon the release of such
guarantor from its obligations under the Companys
revolving credit facilities.
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Optional
Redemption
The notes of each series will be redeemable, as a whole or in
part, at the option of the Company, at any time or from time to
time, at a redemption price equal to the greater of:
(1) 100% of the principal amount of the notes to be
redeemed, and
(2) the sum of the present values of the remaining
scheduled payments of principal and interest on the notes to be
redeemed (and, in the case of the 2020 exchange notes and the
2040 exchange notes, not including any portion of any interest
accrued to the redemption date) discounted to the date of
redemption on a semi-annual basis (assuming a
360-day year
consisting of twelve
30-day
months) at the applicable Treasury Rate, plus 25 basis
points (in the case of the 2020 exchange notes), 30 basis
points (in the case of the 2021 exchange notes and 2040 exchange
notes), or 35 basis points (in the case of the 2019
exchange notes).
In the case of each of clauses (1) and (2), accrued
interest will be payable to the redemption date.
Holders of notes to be redeemed will receive notice thereof by
first-class mail at least 30 and not more than 60 days
before the date fixed for redemption. If fewer than all of the
notes of a series are to be redeemed, the applicable trustee
will select, at least 30 and not more than 60 days prior to
the redemption date, the particular notes
35
or portions thereof for redemption from the outstanding notes of
such series not previously called by such method as the
applicable trustee deems fair and appropriate.
On and after the redemption date, interest will cease to accrue
on the notes of a series or any portion of the notes of a series
called for redemption unless the Company defaults in the payment
of the redemption price and accrued interest. On or before the
redemption date, the Company will deposit with a paying agent
(or the applicable trustee) money sufficient to pay the
redemption price of and accrued interest on the notes of a
series to be redeemed on that date.
Comparable Treasury Issue means the
U.S. Treasury security selected by an Independent
Investment Banker as having a maturity comparable to the
remaining term (Remaining Life) of the notes of a
series to be redeemed that would be utilized, at the time of
selection and in accordance with customary financial practice,
in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such notes.
Comparable Treasury Price means, with respect
to any redemption date, (1) the average of five Reference
Treasury Dealer Quotations for such redemption date, after
excluding the highest and lowest Reference Treasury Dealer
Quotations, or (2) if the Independent Investment Banker
obtains fewer than five such Reference Treasury Dealer
Quotations, the average of all such quotations.
Independent Investment Banker means
(1) with respect to the 2020 exchange notes, any of
Barclays Capital Inc., J.P. Morgan Securities Inc. and UBS
Securities LLC, (2) with respect to the 2021 exchange
notes, any of Banc of America Securities LLC, RBS Securities
Inc., BNP Paribas Securities Corp. or Wells Fargo Securities,
LLC, (3) with respect to the 2019 exchange notes, any of
Banc of America Securities LLC, Barclays Capital or
J.P. Morgan Securities Inc., and (4) with respect to
the 2040 exchange notes, any of Banc of America Securities LLC
and J.P. Morgan Securities Inc., and; in each case, their
respective successors, or, in each case, if all of such firms
are unwilling or unable to select the Comparable Treasury Issue,
an independent investment banking institution of national
standing appointed by the Company.
Reference Treasury Dealer means (1)
(a) with respect to the 2020 exchange notes, any of
Barclays Capital Inc., J.P. Morgan Securities Inc. and UBS
Securities LLC, (b) with respect to the 2021 exchange
notes, each of Banc of America Securities LLC, RBS Securities
Inc. and BNP Paribas Securities Corp., and a Primary Treasury
Dealer (as defined below) selected by Wells Fargo Securities,
LLC, (c) with respect to the 2019 exchange notes, each of
Banc of America Securities LLC, Barclays Capital Inc. and
J.P. Morgan Securities Inc, (d) with respect to the
2040 exchange notes, any of Banc of America Securities LLC and
J.P. Morgan Securities Inc., and, in each case, their
respective successors; provided, however, that if any of the
foregoing shall cease to be a primary U.S. Government
securities dealer in New York City in the case of the 2019
exchange notes and 2021 exchange notes, or generally, in the
case of the 2020 exchange notes and 2040 exchange notes (a
Primary Treasury Dealer), the Company will
substitute for such bank another Primary Treasury Dealer and
(2) any other Primary Treasury Dealer selected by the
Independent Investment Banker after consultation with the
Company.
Reference Treasury Dealer Quotations means,
with respect to each Reference Treasury Dealer and any
redemption date, the average, as determined by any Independent
Investment Banker, of the bid and asked prices for the
Comparable Treasury Issue (expressed in each case as a
percentage of its principal amount) quoted in writing to such
Independent Investment Banker at 5:00 p.m., New York City
time, on the third business day preceding such redemption date.
Treasury Rate means, with respect to any
redemption date, (1) the yield, under the heading which
represents the average for the immediately preceding week,
appearing in the most recently published statistical release
designated H.15(519) or any successor publication
which is published weekly by the Board of Governors of the
Federal Reserve System and which establishes yields on actively
traded U.S. Treasury securities adjusted to constant
maturity under the caption Treasury Constant
Maturities, for the maturity corresponding to the
Comparable Treasury Issue (if no maturity is within three months
before or after the Remaining Life, yields for the two published
maturities most closely corresponding to the Comparable Treasury
Issue will be determined and the Treasury Rate will be
interpolated or extrapolated from such yields on a straight line
basis, rounding to the nearest month) or (2) if such
release (or any successor release) is not published during the
week preceding the calculation date or does not contain such
yields, the rate per annum equal to the semi-annual equivalent
yield to
36
maturity of the Comparable Treasury Issue, calculated using a
price for the Comparable Treasury Issue (expressed as a
percentage of its principal amount) equal to the Comparable
Treasury Price for such redemption date. The Treasury Rate will
be calculated on the third business day preceding the redemption
date.
Change of
Control Triggering Event
Upon the occurrence of a Change of Control Triggering Event with
respect to the notes of any series, unless the Company has
exercised its right to redeem the notes of that series as
described under Optional Redemption,
each holder of notes of that series will have the right to
require the Company to purchase all or a portion (equal to
$2,000 or an integral multiple of $1,000 in excess thereof) of
such holders notes of that series pursuant to the offer
described below (the Change of Control Offer), at a
purchase price equal to 101% of the principal amount thereof
plus accrued and unpaid interest, if any, to the date of
purchase (the Change of Control Payment), subject to
the rights of holders of notes of that series on the relevant
record date to receive interest due on the relevant interest
payment date.
Within 30 days following the date upon which the Change of
Control Triggering Event occurred with respect to the notes of
that series, or at the option of the Company, prior to any
Change of Control but after the public announcement of the
pending Change of Control, the Company will be required to send,
by first class mail, a notice to each holder of notes of that
series, with a copy to the applicable trustee, which notice will
govern the terms of the Change of Control Offer. Such notice
will state, among other things, the purchase date, which must be
no earlier than 30 days nor later than 60 days from
the date such notice is mailed, other than as may be required by
law (the Change of Control Payment Date). The
notice, if mailed prior to the date of consummation of the
Change of Control, will state that the Change of Control Offer
is conditioned on the Change of Control being consummated on or
prior to the Change of Control Payment Date.
On the Change of Control Payment Date, the Company will, to the
extent lawful, (1) accept or cause a third party to accept
for payment all notes or portions of notes properly tendered
pursuant to the Change of Control Offer; (2) deposit or
cause a third party to deposit with the paying agent an amount
equal to the Change of Control Payment in respect of all notes
or portions of notes properly tendered; and (3) deliver or
cause to be delivered to the trustee the notes accepted together
with an officers certificate stating the aggregate
principal amount of notes or portions of notes being repurchased.
The Company will not be required to make a Change of Control
Offer with respect to the notes of the applicable series if a
third party makes such an offer in the manner, at the times and
otherwise in compliance with the requirements for such an offer
made by the Company and such third party purchases all the notes
properly tendered and not withdrawn under its offer.
The Company will comply in all material respects with the
requirements of
Rule 14e-1
under the Securities Exchange Act of 1934, as amended (the
Exchange Act) and any other securities laws and
regulations thereunder to the extent those laws and regulations
are applicable in connection with the repurchase of the notes of
the applicable series as a result of a Change of Control
Triggering Event. To the extent that the provisions of any such
securities laws or regulations conflict with the Change of
Control Offer provisions of the notes, the Company will comply
with those securities laws and regulations and will not be
deemed to have breached the Companys obligations under the
Change of Control Offer provisions of the notes by virtue of any
such conflict.
For purposes of the foregoing discussion of a Change of Control
Offer, the following definitions are applicable:
Change of Control means the occurrence of any
of the following after the date of issuance of the notes:
(1) the direct or indirect sale, lease, transfer,
conveyance or other disposition (other than by way of merger or
consolidation), in one or a series of related transactions, of
all or substantially all of the assets of Republic Services,
Inc. and its Subsidiaries taken as a whole to any
person or group (as those terms are used
in Section 13(d)(3) of the Exchange Act) other than to
Republic Services, Inc. or one of its Subsidiaries;
(2) the consummation of any transaction (including, without
limitation, any merger or consolidation) the result of which is
that any person or group (as those terms
are used in Section 13(d)(3) of the Exchange Act, it being
agreed that an employee of Republic Services, Inc. or any of its
Subsidiaries for whom shares are
37
held under an employee stock ownership, employee retirement,
employee savings or similar plan and whose shares are voted in
accordance with the instructions of such employee shall not be a
member of a group (as that term is used in
Section 13(d)(3) of the Exchange Act) solely because such
employees shares are held by a trustee under said plan)
becomes the beneficial owner (as defined in
Rules 13d-3
and 13d-5
under the Exchange Act), directly or indirectly, of the
Companys Voting Stock representing more than 50% of the
voting power of the Companys outstanding Voting Stock;
(3) the Company consolidates with, or merge with or into,
any Person, or any Person consolidates with, or merges with or
into, the Company, in any such event pursuant to a transaction
in which any of the Companys outstanding Voting Stock or
Voting Stock of such other Person is converted into or exchanged
for cash, securities or other property, other than any such
transaction where the Companys Voting Stock outstanding
immediately prior to such transaction constitutes, or is
converted into or exchanged for, Voting Stock representing more
than 50% of the voting power of the Voting Stock of the
surviving Person immediately after giving effect to such
transaction;
(4) during any period of 24 consecutive calendar months,
the majority of the members of the Companys board of
directors shall no longer be composed of individuals
(a) who were members of the Companys board of
directors on the first day of such period or (b) whose
election or nomination to the Companys board of directors
was approved by individuals referred to in clause (a) above
constituting, at the time of such election or nomination, at
least a majority of the Companys board of directors or, if
directors are nominated by a committee of the Companys
board of directors, constituting at the time of such nomination,
at least a majority of such committee; or
(5) the adoption of a plan relating to the Companys
liquidation or dissolution.
Change of Control Triggering Event means,
with respect to the notes of any series, the notes of that
series cease to be rated Investment Grade by each of the Rating
Agencies on any date during the period (the Trigger
Period) commencing 60 days prior to the first public
announcement by the Company of any Change of Control (or pending
Change of Control) and ending 60 days following
consummation of such Change of Control (which Trigger Period
will be extended following consummation of a Change of Control
for so long as any of the Rating Agencies has publicly announced
that it is considering a possible ratings change). If a Rating
Agency is not providing a rating for the notes of any series at
the commencement of any Trigger Period, the notes of that series
will be deemed to have ceased to be rated Investment Grade by
such Rating Agency during that Trigger Period. Notwithstanding
the foregoing, no Change of Control Triggering Event will be
deemed to have occurred in connection with any particular Change
of Control unless and until such Change of Control has actually
been consummated.
Investment Grade means a rating of Baa3 or
better by Moodys (or its equivalent under any successor
rating category of Moodys) and a rating of BBB-or better
by S&P (or its equivalent under any successor rating
category of S&P), and the equivalent investment grade
credit rating from any replacement rating agency or rating
agencies selected by the Company under the circumstances
permitting the Company to select a replacement agency and in the
manner for selecting a replacement agency, in each case as set
forth in the definition of Rating Agency.
Moodys means Moodys Investors
Service, Inc., a subsidiary of Moodys Corporation, and its
successors.
Person means any individual, corporation,
partnership, limited liability company, joint venture,
association, joint-stock company, trusts, unincorporated
organization or government or any agency or political
subdivisions thereof.
Rating Agency means each of Moodys and
S&P; provided, that if any of Moodys or S&P
ceases to rate the notes of any series or fails to make a rating
of the notes of that series publicly available for reasons
outside the Companys control, the Company may appoint
another nationally recognized statistical rating
organization within the meaning of
Rule 15c3-1(c)(2)(vi)(F)
under the Exchange Act as a replacement for such Rating Agency;
provided, that the Company shall give notice of such appointment
to the applicable trustee.
S&P means Standard &
Poors Ratings Services, a division of The McGraw-Hill
Companies, Inc., and its successors.
38
Voting Stock of any specified Person as of
any date means the capital stock of such Person that is at the
time entitled to vote generally in the election of the board of
directors of such Person.
The definition of Change of Control includes a phrase relating
to the direct or indirect sale, lease, transfer, conveyance or
other disposition of all or substantially all of the
properties or assets of Republic Services, Inc. and its
Subsidiaries taken as a whole. Although there is a limited body
of case law interpreting the phrase substantially
all, there is no precise, established definition of the
phrase under applicable law. Accordingly, the applicability of
the requirement that the Company offer to repurchase the notes
as a result of a sale, lease, transfer, conveyance or other
disposition of less than all of the assets of Republic Services,
Inc. and its Subsidiaries taken as a whole to another Person or
group may be uncertain.
In addition, under a recent Delaware Chancery Court
interpretation of a change of control repurchase requirement
with a continuing director provision, a board of directors may
approve a slate of shareholder-nominated directors without
endorsing them or while simultaneously recommending and
endorsing its own slate instead. The foregoing interpretation
would permit the Companys board to approve a slate of
directors that included a majority of dissident directors
nominated pursuant to a proxy contest, and the ultimate election
of such dissident slate would not constitute a Change of
Control Triggering Event that would trigger your right to
require the Company to repurchase your notes as described above.
Certain
Covenants
The following restrictions will apply to each series of notes:
Restrictions
on Liens
The Company will not, and will not permit any Restricted
Subsidiary to, Incur any Lien on any shares of stock,
Indebtedness or other obligations of a Subsidiary or any
Principal Property of the Companys or a Restricted
Subsidiary, whether such shares of stock, Indebtedness or other
obligations of a Subsidiary or Principal Property is owned at
the date of the applicable indenture or thereafter acquired,
without in any such case effectively providing that all the
notes will be directly secured equally and ratably with such
Lien.
These restrictions do not apply to:
(1) the Incurrence of any Lien on any shares of stock,
Indebtedness or other obligations of a Subsidiary or any
Principal Property acquired after the date of the applicable
indenture (including acquisitions by way of merger or
consolidation) by the Company or a Restricted Subsidiary
contemporaneously with such acquisition, or within 120 days
thereafter, to secure or provide for the payment or financing of
any part of the purchase price thereof, or the assumption of any
Lien upon any shares of stock, Indebtedness or other obligations
of a Subsidiary or any Principal Property acquired after the
date of the applicable indenture existing at the time of such
acquisition, or the acquisition of any shares of stock,
Indebtedness or other obligations of a Subsidiary or any
Principal Property subject to any Lien without the assumption
thereof, provided that every such Lien referred to in this
clause (1) shall attach only to the shares of stock,
Indebtedness or other obligations of a Subsidiary or any
Principal Property so acquired and fixed improvements thereon;
(2) any Lien on any shares of stock, Indebtedness or other
obligations of a Subsidiary or any Principal Property existing
on the date the notes are initially issued;
(3) any Lien on any shares of stock, Indebtedness or other
obligations of a Subsidiary or any Principal Property in favor
of Republic Services, Inc. or any Restricted Subsidiary;
(4) any Lien on Principal Property being constructed or
improved securing loans to finance such construction or
improvements;
(5) any Lien on shares of stock, Indebtedness or other
obligations of a Subsidiary or any Principal Property Incurred
in connection with the issuance of tax-exempt government
obligations; and
39
(6) any renewal of or substitution for any Lien permitted
by any of the preceding clauses (1) through (5), provided,
in the case of a Lien permitted under clause (1), (2) or
(4), the debt secured is not increased nor the Lien extended to
any additional assets.
Notwithstanding the foregoing, the Company or any Restricted
Subsidiary may create or assume Liens in addition to those
permitted by clauses (1) through (6), and renew, extend or
replace such Liens, provided that at the time of such creation,
assumption, renewal, extension or replacement of such Lien, and
after giving effect thereto, together with any sale and
leaseback transactions entered into pursuant to the provisions
of the applicable indenture described below in the last
paragraph under Certain Covenants
Limitations on Sale and Leaseback Transactions, Exempted
Debt does not exceed 20% of Consolidated Net Tangible Assets.
For the purposes of this Restrictions on Liens
covenant and the Limitation on Sale and Leaseback
Transactions covenant, the giving of a guarantee which is
secured by a Lien on any shares of stock, Indebtedness or other
obligations of a Subsidiary or any Principal Property, and the
creation of a Lien on any shares of stock, Indebtedness or other
obligations of a Subsidiary or any Principal Property to secure
Indebtedness that existed prior to the creation of such Lien,
shall be deemed to involve the creation of Indebtedness in an
amount equal to the principal amount guaranteed or secured by
such Lien.
Given the size of the Companys operations, at any given
time the Company expects to have very few or no Principal
Properties and, accordingly, very few or no Restricted
Subsidiaries.
Limitation
on Sale and Leaseback Transactions
The indentures provide that the Company will not, and will not
permit any Restricted Subsidiary to, sell or transfer, directly
or indirectly, except to the Company or a Restricted Subsidiary,
any Principal Property as an entirety, or any substantial
portion thereof, with the intention of taking back a lease of
such property, except a lease for a period of two years or less
at the end of which it is intended that the use of such property
by the lessee will be discontinued; provided that,
notwithstanding the foregoing, the Company or any Restricted
Subsidiary may sell any such Principal Property and lease it
back for a longer period:
(1) if the Company or such Restricted Subsidiary would be
entitled, pursuant to the provisions of the applicable indenture
described above under Certain
Covenants Restrictions on Liens, to create a
mortgage on the property to be leased securing Funded Debt in an
amount equal to the Attributable Debt with respect to such sale
and leaseback transaction without equally and ratably securing
the outstanding notes; or
(2) if the Company promptly informs the applicable trustee
of such transaction, the net proceeds of such transaction are at
least equal to the fair market value (as determined by board
resolution) of such property, and the Company causes an amount
equal to the net proceeds of the sale to be applied to the
retirement, within 180 days after receipt of such proceeds,
of Funded Debt Incurred or assumed by the Company or a
Restricted Subsidiary (including the notes); provided further
that, in lieu of applying all or any part of such net proceeds
to such retirement, the Company may, within 75 days after
such sale or transfer, deliver or cause to be delivered to the
applicable trustee for cancellation either debentures or notes
evidencing Funded Debt of the Company (which may include the
notes offered hereby) or of a Restricted Subsidiary previously
authenticated and delivered by the applicable trustee, and not
theretofore tendered for sinking fund purposes or called for a
sinking fund or otherwise applied as a credit against an
obligation to redeem or retire such notes or debentures. If the
Company so delivers debentures or notes to the applicable
trustee and an officers certificate to the applicable
trustee for the notes, the amount of cash that the Company will
be required to apply to the retirement of Funded Debt will be
reduced by an amount equal to the aggregate of the then
applicable optional redemption prices (not including any
optional sinking fund redemption prices) of such debentures or
notes, or if there are no such redemption prices, the principal
amount of such debentures or notes, provided, that in the case
of debentures or notes which provide for an amount less than the
principal amount thereof to be due and payable upon a
declaration of the maturity thereof, such amount of cash shall
be reduced by the amount of principal of such debentures or
notes that would be due and payable as of the date of such
application upon a declaration of acceleration of the maturity
thereof pursuant to the terms of the indenture pursuant to which
such debentures or notes were issued; or
40
(3) if the Company, within 180 days after the sale or
transfer, apply or cause a Restricted Subsidiary to apply an
amount equal to the greater of the net proceeds of such sale or
transfer or the fair market value of the Principal Property (or
portion thereof) so sold and leased back at the time of entering
into such sale and leaseback transaction (in either case as
determined by board resolution) to purchase other Principal
Property having a fair market value at least equal to the fair
market value of the Principal Property (or portion thereof) sold
or transferred in such sale and leaseback transaction.
Notwithstanding the foregoing, the Company or any Restricted
Subsidiary may enter into sale and leaseback transactions in
addition to those permitted in the foregoing paragraph and
without any obligation to retire any outstanding notes or other
Funded Debt, provided that at the time of entering into such
sale and leaseback transactions and after giving effect thereto,
together with any Liens created, assumed or otherwise incurred
pursuant to the provisions of the applicable indenture described
above in the third paragraph under Certain
Covenants Restrictions on Liens, Exempted Debt
does not exceed 20% of Consolidated Net Tangible Assets.
Definitions
Set forth below are certain defined terms used in the
indentures. Reference is made to the applicable indenture for a
full disclosure of all such terms, as well as any other
capitalized terms used herein for which no definition is
provided.
Attributable Debt means, when used in
connection with a sale and leaseback transaction, at any date of
determination, the product of (1) the net proceeds from
such sale and leaseback transaction multiplied by (2) a
fraction, the numerator of which is the number of full years of
the term of the lease relating to the property involved in such
sale and leaseback transaction (without regard to any options to
renew or extend such term) remaining at the date of the making
of such computation and the denominator of which is the number
of full years of the term of such lease measured from the first
day of such term.
Capital Stock means, with respect to any
Person, any and all shares, interests, rights to purchase,
warrants, options, participations or other equivalents of or
interests (including partnership interests) in (however
designated) the equity of such Person, including any preferred
stock, but excluding any debt securities convertible into such
equity.
Consolidated Net Tangible Assets means, as of
any date, the total amount of assets of Republic Services, Inc.
and its Subsidiaries on a consolidated basis (less applicable
reserves and other properly deductible items) after deducting
therefrom (1) all current liabilities (excluding any
current liabilities which are by their terms extendible or
renewable at the option of the obligor thereon to a time more
than 12 months after the time as of which the amount
thereof is being computed or which are supported by other
borrowings with a maturity of more than 12 months from the
date of calculation), (2) all goodwill, trade names,
trademarks, patents, unamortized debt discount and expense and
other like intangibles and (3) appropriate adjustments on
account of minority interests of other Persons holding stock of
Republic Services, Inc.s Subsidiaries, all as set forth on
the most recent balance sheet of Republic Services, Inc. and its
consolidated Subsidiaries (but, in any event, as of a date
within 120 days of the date of determination), in each case
excluding intercompany items and computed in accordance with
generally accepted accounting principles.
Exempted Debt means the sum, without
duplication, of the following items outstanding as of the date
Exempted Debt is being determined with respect to each series of
notes: (1) Indebtedness of Republic Services, Inc. and the
Restricted Subsidiaries Incurred after the date of the
applicable supplemental indenture and secured by Liens created,
assumed or otherwise Incurred or permitted to exist pursuant to
the provisions of the applicable indenture described above under
Certain Covenants Restrictions on
Liens and (2) Attributable Debt of Republic Services,
Inc. and the Restricted Subsidiaries in respect of all sale and
leaseback transactions with regard to any Principal Property
entered into pursuant to the provisions of the applicable
indenture described above under Certain
Covenants Limitation on Sale and Leaseback
Transactions.
Funded Debt means all Indebtedness for
borrowed money, including purchase money indebtedness, having a
maturity of more than one year from the date of its creation or
having a maturity of less than one year but by its
41
terms being renewable or extendible, at the option of the
obligor in respect thereof, beyond one year from its creation.
Incur means to issue, assume, guarantee,
incur or otherwise become liable for. The terms
Incurred, Incurrence and
Incurring shall each have a correlative meaning.
Indebtedness means with respect to any Person
at any date of determination (without duplication), indebtedness
for borrowed money or indebtedness evidenced by bonds, notes,
debentures or other similar instruments given to finance the
acquisition of any businesses, properties or assets of any kind
(including, without limitation, Capital Stock or other equity
interests in any Person).
Lien with respect to any property or assets,
means any mortgage or deed of trust, pledge, hypothecation,
assignment, deposit arrangement, security interest, lien,
charge, easement (other than any easement not materially
impairing usefulness or marketability), encumbrance, preference,
priority or other security agreement or preferential arrangement
of any kind or nature whatsoever on or with respect to such
property or assets (including, without limitation, any
conditional sale or other title retention agreement having
substantially the same economic effect as any of the foregoing),
but not including the interest of a lessor under a lease that is
an operating lease under generally accepted accounting
principles.
Principal Property means any land, land
improvements or building, together with the land upon which it
is erected and fixtures comprising a part thereof, in each case,
owned or leased by the Company or any Restricted Subsidiary and
located in the United States, the gross book value (without
deduction of any reserve for depreciation) of which on the date
as of which the determination is being made is an amount which
exceeds 2% of Consolidated Net Tangible Assets but not including
such land, land improvements, buildings or portions thereof
which is financed through the issuance of tax-exempt
governmental obligations, or any such property that has been
determined by a board resolution not to be of material
importance to the respective businesses conducted by the Company
or such Restricted Subsidiary effective as of the date such
resolution is adopted by the Companys board of directors.
Restricted Subsidiary means any Subsidiary
which, at the time of determination, owns or is a lessee
pursuant to a capital lease of any Principal Property.
Subsidiary of a Person means, with respect to
any Person, any corporation, association, partnership or other
business entity of which at least a majority of the total voting
power of the Capital Stock entitled (without regard to the
occurrence of any contingency) to vote in the election of
directors, managers or trustees thereof is at the time owned or
controlled, directly or indirectly, by (1) such Person,
(2) such Person and one or more Subsidiaries of such Person
or (3) one or more Subsidiaries of such Person.
Consolidation,
Merger or Sale of Substantially All Assets
The Company may consolidate or merge with, or sell all or
substantially all of the Companys assets to, another
corporation as long as the surviving corporation is organized
under the laws of the United States or any state thereof or the
District of Columbia and the consolidation, merger or sale does
not create a default under the applicable indenture. The
remaining or acquiring corporation must assume all of the
Companys responsibilities and liabilities under the
applicable indenture, including the payment of all amounts due
on the notes and performance of the covenants. Under these
circumstances, if the Companys properties or assets become
subject to a Lien not permitted by the applicable indenture, the
Company will equally and ratably secure the notes.
Filing of
Financial Statements
The indentures require the Company to file quarterly and annual
financial statements with the SEC.
Events of
Default
An event of default under the applicable indenture with respect
to any series of notes includes the following:
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failure to pay interest on the notes of that series for
30 days;
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failure to pay principal on the notes of that series when due;
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failure to perform any of the other covenants or agreements in
the applicable indenture relating to the notes of that series
that continues for 60 days after notice to the Company by
the applicable trustee or holders of at least 25% in principal
amount of the notes of that series then outstanding (for
purposes of the financial statement reporting covenant, the
60-day grace
period will be extended to 365 days);
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failure to pay when due any Indebtedness of the Company or any
Restricted Subsidiary having an aggregate principal amount
outstanding of at least $25.0 million that continues for
25 days after notice to the Company by the applicable
trustee or holders of at least 25% in principal amount of the
notes of that series then outstanding; or
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certain events of bankruptcy, insolvency or reorganization
relating to the Company or any Restricted Subsidiary.
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The indentures provide that the applicable trustee will, with
certain exceptions, notify the holders of notes of the
applicable series of any event of default known to it with
respect to the notes of that series within 90 days after
the occurrence of such event.
If an event of default (other than with respect to certain
events of bankruptcy, insolvency or reorganization) occurs and
is continuing with respect to the notes of any series, the
applicable trustee or the holders of not less than 25% in
principal amount of the notes of that series then outstanding
may declare the principal amount to be due and payable. In that
case, subject to certain conditions, the holders of a majority
in principal amount of the notes of that series then outstanding
can rescind and annul such declaration and its consequences. If
an event of default with respect to certain events of
bankruptcy, insolvency or reorganization occurs and is
continuing, then all of the notes will ipso facto become and be
due and payable immediately in an amount equal to the principal
amount of the notes, together with accrued and unpaid interest,
if any, to the date the notes become due and payable, without
any declaration or other act on the part of the applicable
trustee or any holder.
In the event of a declaration of acceleration because an event
of default related to the failure to pay when due any
Indebtedness having an aggregate principal amount outstanding of
at least $25.0 million has occurred and is continuing, such
declaration of acceleration shall be automatically rescinded and
annulled if the default triggering such event of default shall
be remedied or cured by the Company or the relevant Subsidiary
or waived by the holders of the relevant Indebtedness within
60 days after the declaration of acceleration with respect
thereto.
The Company is required to file an annual officers
certificate with the applicable trustee concerning the
Companys compliance with the applicable indenture. Subject
to the provisions of the applicable indenture relating to the
duties of the trustee, the applicable trustee is not obligated
to exercise any of its rights or powers at the request or
direction of any of the holders unless they have offered the
applicable trustee security or indemnity satisfactory to the
applicable trustee. If the holders provide security or indemnity
satisfactory to the applicable trustee, the holders of a
majority in principal amount of the outstanding notes of the
applicable series during an event of default may direct the
time, method and place of conducting any proceeding for any
remedy available to the applicable trustee under the applicable
indenture or exercising any of the applicable trustees
trusts or powers with respect to the notes.
Prior to the acceleration of the maturity of the notes of any
series, the holders of not less than a majority in aggregate
principal amount of the outstanding notes of that series may on
behalf of the holders of all outstanding notes of that series
waive any past default or event of default and its consequences,
except a default or event of default (a) in the payment of
the principal of, premium, if any, or interest on any note of
that series (which may only be waived with the consent of each
holder of notes affected) or (b) in respect of a covenant
or a provision of the applicable indenture which cannot be
modified or amended without the consent of the holder of each
note outstanding affected by such modification or amendment.
Modification
and Amendment of the Indentures
The Company and the guarantors may enter into supplemental
indentures to the applicable indenture with the applicable
trustee without the consent of the holders of the notes to,
among other things:
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evidence the assumption by a successor corporation of the
Companys obligations;
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add covenants for the protection of the holders of the notes of
any series;
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create a new series of securities under the applicable indenture;
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cure any ambiguity or correct any inconsistency in the
applicable indenture;
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add guarantees or security; and
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make any change that does not adversely affect the rights of
holders of the notes.
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With the consent of the holders of a majority in principal
amount of the notes of any series then outstanding and affected,
the Company and the guarantors may execute supplemental
indentures with the applicable trustee to add provisions or
change or eliminate any provision of the applicable indenture or
any supplemental indenture or to modify the rights of the
holders of the notes so affected.
Without the consent of the holders of each outstanding note of a
series affected, no supplemental indenture will, among other
things:
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reduce the percentage in principal amount of the notes of that
series, the consent of the holders of which is required for any
such supplemental indenture;
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reduce the principal amount of the notes of that series or their
interest rate or change the stated maturity of or extend the
time for payment of interest on the notes of that series;
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reduce the premium payable upon redemption of the notes of that
series or change the time when the notes of that series may or
shall be redeemed;
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amend, change or modify the Companys obligation to make
and consummate a Change of Control Offer in the event of a
Change of Control Triggering Event in accordance with
Change of Control Triggering Event above
after such Change of Control Triggering Event has occurred,
including amending, changing or modifying any definition related
thereto;
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impair the right to institute suit for the enforcement of the
notes of that series;
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reduce the percentage in principal amount of the notes of that
series required for waiver of compliance with certain provisions
of the applicable indenture or certain defaults; or
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modify any other provisions with respect to modification and
waiver, except to increase the percentage required for any
modification or waiver or to provide that other provisions of
the applicable indenture may not be modified or waived without
your consent.
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Defeasance
and Covenant Defeasance
At the option of the Company, the Company (1) will be
discharged from all obligations under the applicable indenture
in respect of the notes of any series (except for certain
obligations to exchange or register the transfer of the notes of
that series, replace stolen, lost or mutilated notes of that
series, maintain paying agencies and hold monies for payment in
trust) or (2) need not comply with certain restrictive
covenants of the applicable indenture (including the
restrictions on Liens, the limitations on sale and lease back
transactions and the requirement to make a Change of Control
Offer) with respect to the notes of that series, in each case if
the Company deposits with the applicable trustee, in trust,
money or U.S. government obligations (or a combination
thereof) sufficient to pay the principal of and any premium or
interest on the notes of that series when due. In order to
select option (1) above, the Company must provide the
trustee with an opinion of counsel stating that (a) the
Company received from, or there has been published by, the
Internal Revenue Service a ruling or (b) since the date of
the applicable indenture, there has been a change in the
applicable federal income tax law, in either case to the effect
that and based thereon such opinion of counsel shall confirm
that, the holders and beneficial owners of the notes of that
series will not recognize income, gain or loss for federal
income tax purposes as a result of such defeasance and will be
subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
defeasance had not occurred. In order to select option
(2) above, the Company must provide the applicable trustee
with an opinion of counsel to the effect that the holders and
beneficial owners of the notes of that series will not recognize
income, gain or loss for federal income tax purposes as a result
of such covenant defeasance and will be
44
subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such
covenant defeasance had not occurred.
In the event the Company exercises its option under
(2) above with respect to the notes of any series and the
notes of that series are declared due and payable because of the
occurrence of any event of default other than default with
respect to such obligations, the amount of money and
U.S. government obligations on deposit with the applicable
trustee will be sufficient to pay amounts due on the notes of
that series at the time of their stated maturity but may not be
sufficient to pay amounts due on the notes of that series at the
time of the acceleration resulting from such event of default.
The Company would remain liable, however, for such amounts.
Satisfaction
and Discharge
The applicable indenture will be discharged as to all
outstanding notes when:
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either (1) all of the notes authenticated and delivered
(other than (i) lost, stolen or destroyed notes which have
been replaced or paid in accordance with the applicable
indenture or (ii) all notes for whose payment money has
been deposited in trust or segregated and held in trust by the
Company and thereafter repaid to the Company or discharged from
such trust) have been delivered to the applicable trustee for
cancellation, or (2) all notes not delivered to the
applicable trustee for cancellation (i) have become due and
payable or (ii) will become due and payable at their stated
maturity within one year; and the Company has irrevocably
deposited or caused to be deposited with the applicable trustee
as trust funds in trust an amount in U.S. dollars
sufficient to pay and discharge the entire indebtedness on the
notes not theretofore delivered to the applicable trustee for
cancellation;
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the Company has paid or caused to be paid all other sums payable
by the Company under the applicable indenture; and
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the Company has delivered to the applicable trustee an
officers certificate and an opinion of independent counsel
each stating that (i) all conditions precedent relating to
the satisfaction and discharge have been complied with,
(ii) no default with respect to the notes has occurred and
is continuing and (iii) such deposit does not result in a
breach or violation of, or constitute a default under, the
applicable indenture or any other agreement or instrument to
which the Company is a party.
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Governing
Law
The indentures will be governed by, and construed in accordance
with, the laws of the State of New York.
Book-Entry,
Delivery and Form
The notes will be issued in one or more fully registered global
notes (the Global Notes) in minimum denominations of
$2,000 and integral multiples of $1,000 in excess thereof. The
Global Notes will be deposited upon issuance with the applicable
trustee as custodian for The Depository Trust Company
(DTC), in New York, New York, and registered in the
name of DTC or its nominee, in each case for credit to an
account of a direct or indirect participant in DTC as described
below.
Except as set forth below, the Global Notes may be transferred,
in whole and not in part, only to another nominee of DTC or to a
successor of DTC or its nominee. Beneficial interests in the
Global Notes may be exchanged for notes in certificated form
only in limited circumstances. See
Exchange of Global Notes for
Certificated Notes. In addition, transfers of beneficial
interests in the Global Notes will be subject to the applicable
rules and procedures of DTC and its direct or indirect
participants (including, if applicable, those of Euroclear and
Clearstream), which may change from time to time.
Depository
Procedures
The following description of the operations and procedures of
DTC, Euroclear and Clearstream are provided solely as a matter
of convenience. These operations and procedures are solely
within the control of the respective
45
settlement systems and are subject to changes by them. The
Company takes no responsibility for these operations and
procedures and urge investors to contact the system or their
participants directly to discuss these matters.
DTC has advised the Company that DTC is a limited-purpose trust
company created to hold securities for its participating
organizations (collectively, the Participants) and
to facilitate the clearance and settlement of transactions in
those securities between Participants through electronic
book-entry changes in accounts of its Participants. The
Participants include securities brokers and dealers (including
the initial purchasers), banks, trust companies, clearing
corporations and certain other organizations. Access to
DTCs system is also available to other entities such as
banks, brokers, dealers and trust companies that clear through
or maintain a custodial relationship with a Participant, either
directly or indirectly (collectively, the Indirect
Participants).
Persons who are not Participants may beneficially own securities
held by or on behalf of DTC only through the Participants or the
Indirect Participants. The ownership interests in, and transfers
of ownership interests in, each security held by or on behalf of
DTC are recorded on the records of the Participants and Indirect
Participants.
DTC has also advised the Company that, pursuant to procedures
established by it: (1) upon deposit of the Global Notes,
DTC will credit the accounts of Participants designated by the
initial purchasers with portions of the principal amount of the
Global Notes; and (2) ownership of these interests in the
Global Notes will be shown on, and the transfer of ownership
thereof will be effected only through, records maintained by DTC
(with respect to the Participants) or by the Participants and
the Indirect Participants (with respect to other owners of
beneficial interest in the Global Notes).
Except as described below, owners of interests in the Global
Notes will not have notes registered in their names, will not
receive physical delivery of notes in certificated form and will
not be considered the registered owners or holders
thereof under the applicable indenture for any purpose.
Payments in respect of the principal of, and interest and
premium, if any, on a Global Note registered in the name of DTC
or its nominee will be payable to DTC in its capacity as the
registered holder under the applicable indenture. Under the
terms of the applicable indenture, the Company and the
applicable trustee will treat the Persons in whose names the
notes, including the Global Notes, are registered as the owners
thereof for the purpose of receiving payments and for all other
purposes. Consequently, neither the Company, the applicable
trustee nor any agent of the Company or the applicable trustee
has or will have any responsibility or liability for:
(1) any aspect of DTCs records or any
Participants or Indirect Participants records
relating to or payments made on account of beneficial ownership
interest in the Global Notes or for maintaining, supervising or
reviewing any of DTCs records or any Participants or
Indirect Participants records relating to the beneficial
ownership interests in the Global Notes; or (2) any other
matter relating to the actions and practices of DTC or any of
its Participants or Indirect Participants.
DTC has advised the Company that its current practice, upon
receipt of any payment in respect of securities such as the
notes (including principal and interest), is to credit the
accounts of the relevant Participants with the payment on the
payment date unless DTC has reason to believe it will not
receive payment on such payment date. Each relevant Participant
is credited with an amount proportionate to its beneficial
ownership of an interest in the principal amount of the relevant
security as shown on the records of DTC. Payments by the
Participants and the Indirect Participants to the beneficial
owners of notes will be governed by standing instructions and
customary practices and will be the responsibility of the
Participants or the Indirect Participants and will not be the
responsibility of DTC, the applicable trustee or the Company.
Neither the Company nor the applicable trustee will be liable
for any delay by DTC or any of its Participants or Indirect
Participants in identifying the beneficial owners of the notes,
and the Company and the applicable trustee may conclusively rely
on and will be protected in relying on instructions from DTC or
its nominee for all purposes.
Transfers between Participants in DTC will be effected in
accordance with DTCs procedures, and will be settled in
same-day
funds, and transfers between Participants in Euroclear and
Clearstream will be effected in accordance with their respective
rules and operating procedures.
Cross-market transfers between the Participants in DTC, on the
one hand, and Euroclear or Clearstream participants, on the
other hand, will be effected through DTC in accordance with
DTCs rules on behalf of Euroclear or Clearstream, as the
case may be, by its respective depositary; however, such
cross-market transactions will
46
require delivery of instructions to Euroclear or Clearstream, as
the case may be, by the counterparty in such system in
accordance with the rules and procedures and within the
established deadlines (Brussels time) of such system. Euroclear
or Clearstream, as the case may be, will, if the transaction
meets its settlement requirements, deliver instructions to its
respective depositary to take action to effect final settlement
on its behalf by delivering or receiving interests in the
relevant Global Note in DTC, and making or receiving payment in
accordance with normal procedures for
same-day
funds settlement applicable to DTC. Euroclear participants and
Clearstream participants may not deliver instructions directly
to the depositories for Euroclear or Clearstream.
DTC has advised the Company that it will take any action
permitted to be taken by a holder of notes only at the direction
of one or more Participants to whose account DTC has credited
the interests in the Global Notes and only in respect of such
portion of the aggregate principal amount of the notes as to
which such Participant or Participants has or have given such
direction. However, if there is an event of default under the
notes, DTC reserves the right to exchange the Global Notes for
legended notes in certificated form, and to distribute such
notes to its Participants.
Although DTC, Euroclear and Clearstream have agreed to the
foregoing procedures to facilitate transfers of interests Global
Notes among Participants in DTC, Euroclear and Clearstream, they
are under no obligation to perform or to continue to perform
such procedures, and may discontinue such procedures at any
time. Neither the Company nor the applicable trustee nor any of
their respective agents will have any responsibility for the
performance by DTC, Euroclear or Clearstream or their respective
Participants or Indirect Participants of their respective
obligations under the rules and procedures governing their
operations.
Exchange
of Global Notes for Certificated Notes
A Global Note is exchangeable for definitive notes in registered
certificated form (Certificated Notes) if
(1) DTC (a) notifies the Company that it is unwilling
or unable to continue as depositary for the Global Notes and the
Company fails to appoint a successor depositary or (b) has
ceased to be a clearing agency registered under the Exchange Act
and the Company fails to appoint a successor depositary,
(2) the Company elects to issue Certificated Notes or
(3) there shall have occurred and be continuing an event of
default with respect to the notes.
In addition, beneficial interests in a Global Note may be
exchanged for Certificated Notes upon prior written notice given
to the applicable trustee by or on behalf of DTC in accordance
with the applicable indenture. In all cases, Certificated Notes
delivered in exchange for any Global Note or beneficial
interests in Global Notes will be registered in the names, and
issued in any approved denominations, requested by or on behalf
of the depositary (in accordance with its customary procedures).
Same-Day
Settlement and Payment
The Company will make payments in respect of the notes
represented by the Global Notes (including principal, premium,
if any, and interest, if any) by wire transfer of immediately
available funds to the accounts specified by the Global Note
holder. The Company will make all payments of principal,
interest and premium, if any, with respect to Certificated Notes
by wire transfer of immediately available funds to the accounts
specified by the holders thereof or, if no such account is
specified, by mailing a check to each such holders
registered address. The notes represented by the Global Notes
are expected to be eligible to trade in DTCs
Same-Day
Funds Settlement System, and any permitted secondary market
trading activity in such notes will, therefore, be required by
DTC to be settled in immediately available funds. The Company
expects that secondary trading in any Certificated Notes will
also be settled in immediately available funds.
Because of time zone differences, the securities account of a
Euroclear or Clearstream participant purchasing an interest in a
Global Note from a Participant in DTC will be credited, and any
such crediting will be reported to the relevant Euroclear or
Clearstream participant, during the securities settlement
processing day (which must be a business day for Euroclear and
Clearstream) immediately following the settlement date of DTC.
DTC has advised the Company that cash received in Euroclear or
Clearstream as a result of sales of interests in a Global Note
by or through a Euroclear or Clearstream participant to a
Participant in DTC will be received with value on the settlement
date of DTC but will be available in the relevant Euroclear or
Clearstream cash account only as of the business day for
Euroclear or Clearstream following DTCs settlement date.
47
MATERIAL
U.S. FEDERAL INCOME TAX CONSIDERATIONS
The following is a discussion of material U.S. federal
income tax considerations and, in the case of a
non-U.S. holder
(as defined below), material U.S. federal estate tax
considerations, to beneficial owners of unregistered notes whose
unregistered notes are tendered and accepted in an exchange
offer. This summary is based on the U.S. federal income tax
laws, regulations, rulings and judicial decisions now in effect,
all of which are subject to change or differing interpretation,
possibly with retroactive effect. This summary does not discuss
all aspects of U.S. federal income taxation that may be
relevant to a particular beneficial owner of unregistered notes
or to certain types of beneficial owners of unregistered notes
that may be subject to special tax rules (such as banks,
tax-exempt entities, insurance companies, S corporations,
dealers in securities or currencies, traders in securities
electing to
mark-to-market,
pass-through entities (including partnerships and entities and
arrangements classified as partnerships for U.S. federal
income tax purposes) and beneficial owners of pass-through
entities, beneficial owners that incurred indebtedness to
purchase or carry the unregistered notes, beneficial owners that
hold the unregistered notes or will hold the exchange notes as a
position in a straddle or conversion transaction, or
as part of a synthetic security or other integrated
financial transaction or beneficial owners that have a
functional currency other than the
U.S. dollar). The discussion is limited to exchanging
beneficial owners of unregistered notes that have held the
unregistered notes, and will hold the exchange notes, as
capital assets within the meaning of
section 1221 of the Internal Revenue Code of 1986, as
amended (the Code). Because the law with respect to
certain U.S. federal income tax considerations of the
exchange offers is uncertain and no ruling has been or will be
requested from the Internal Revenue Service (the
IRS) on any U.S. federal income tax matter
concerning the exchange offers, no assurances can be given that
the IRS or a court considering these issues will agree with the
positions or conclusions discussed below.
Exchange
Offers
The exchange of unregistered notes for exchange notes in the
exchange offers will not constitute a taxable event to holders
for U.S. federal income tax purposes. Consequently, you
will not recognize gain or loss upon receipt of an exchange
note. The holding period of the exchange note will include the
holding period of the unregistered note exchanged therefor and
the basis of the exchange note will be the same as the basis of
the unregistered note immediately before the exchange.
Persons considering the exchange of unregistered notes for
exchange notes should consult their own tax advisors concerning
the U.S. federal income tax consequences in light of their
particular situations as well as any consequences arising under
the laws of any other taxing jurisdiction.
U.S.
Holders
The discussion below applies to you only if you are a
U.S. holder. A U.S. Holder is a beneficial
owner of unregistered notes whose unregistered notes are
tendered and accepted in an exchange offer that is, for
U.S. federal income tax purposes, (a) a citizen or
resident of the United States, (b) a corporation (or other
entity classified as a corporation for such purposes) created or
organized in or under the laws of the United States, or any
State thereof or the District of Columbia, (c) an estate,
the income of which is subject to U.S. federal income
taxation regardless of the source of that income, or (d) a
trust if (i) a court within the United States can exercise
primary supervision over its administration and one or more
United States persons (as defined for
U.S. federal income tax purposes) have the authority to
control all of the substantial decisions of the trust or
(ii) the trust has validly elected to be treated as a
United States person under applicable regulations.
Interest. Interest on an unregistered note and
interest on an exchange note received by a U.S. Holder will
be taxable to the U.S. Holder as ordinary interest income
in accordance with the U.S. Holders method of
accounting for U.S. federal income tax purposes.
Amortizable Bond Premium. Unamortized bond
premium which a U.S. Holder may have on the unregistered
notes will carry over to the exchange notes received in exchange
therefor. It may be possible for the U.S. Holder to elect
to amortize this premium using a constant yield method over the
term of the exchange note (or until an earlier call date, as
applicable). The amortized amount of the premium for a taxable
year generally will be treated first as a reduction of interest
on the exchange note included in such taxable year to the extent
thereof, then as a deduction
48
allowed in that taxable year to the extent of the beneficial
owners prior interest inclusions on the exchange note, and
finally as a carryforward allowable against the beneficial
owners future interest inclusions on the exchange note. A
U.S. Holder must reduce its tax basis in such exchange note
by the amount of the premium so amortized. The election to
amortize premium on a constant yield method, once made, applies
to all debt obligations held or subsequently acquired by the
electing U.S. Holder on or after the first day of the
taxable year to which the election applies and may not be
revoked without the consent of the Service. U.S. Holders
should consult their own tax advisors concerning the computation
and amortization of any bond premium on their exchange notes.
Market Discount. Accrued market discount on
unregistered notes not previously treated as ordinary income by
a U.S. Holder will carry over to the exchange notes
received in exchange therefor. A U.S. Holder will be
required to treat any gain on the sale, exchange, retirement or
other taxable disposition (collectively, a
disposition) of an exchange note as ordinary income
to the extent of the accrued market discount on the exchange
note at the time of the disposition unless such market discount
has been previously included in income by the U.S. Holder
pursuant to an election by the beneficial owner to include the
market discount in income as it accrues (under either a ratable
or constant yield method).
Dispositions. Subject to the discussion above
regarding market discount, a U.S. Holders disposition
of an exchange note will result in capital gain or loss equal to
the difference between the amount realized (except to the extent
such amount is attributable to accrued but unpaid interest on
the exchange note, which amount will be taxable as ordinary
interest income in accordance with such U.S. holders
method of accounting for U.S. federal income tax purposes)
and the U.S. Holders adjusted tax basis in such
exchange note immediately before such disposition (which should
reflect any market discount previously included in income).
Capital gain or loss will be long-term capital gain or loss if
at the time of the disposition the U.S. Holder has held the
exchange note for more than one year. Subject to limited
exceptions, capital losses cannot be used to offset ordinary
income.
Non-U.S.
Holders
The following discussion applies to you if you are a beneficial
owner of unregistered notes whose unregistered notes are
exchanged for exchange notes and you are not a U.S. Holder
(as defined above) and also are not a partnership (or an entity
or arrangement classified as a partnership for U.S. federal
tax purposes) (a
non-U.S. holder).
Interest. The United States generally imposes
a 30 percent withholding tax on payments of interest to
non-U.S. persons.
The 30 percent (or lower applicable treaty rate)
U.S. federal withholding tax will not apply to a
non-U.S. Holder
in respect of any payment of interest on the exchange notes that
is not effectively connected with the conduct of a
U.S. trade or business provided that such holder:
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does not actually (or constructively) own 10 percent or
more of the total combined voting power of all classes of our
voting stock within the meaning of the Code and the
U.S. Treasury regulations;
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is not a controlled foreign corporation that is related to us
actually or constructively through sufficient stock ownership;
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is not a bank whose receipt of interest on the notes is
described in section 881(c)(3)(A) of the Code; and
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(a) provides identifying information (i.e., name and
address) to us or our paying agent on IRS
Form W-8BEN
(or successor form), and certifies, under penalty of perjury,
that such holder is not a U.S. person or (b) a
financial institution holding the notes on behalf of such holder
certifies, under penalty of perjury, that it has received the
applicable IRS
Form W-8BEN
(or successor form) from the beneficial owner and provides us
with a copy.
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If a
non-U.S. Holder
cannot satisfy the requirements described above, payments of
interest made to such holder will be subject to the
30 percent U.S. federal withholding tax, unless such
holder provides us with a properly executed (i) IRS
Form W-8BEN
(or successor form) claiming an exemption from or reduction in
withholding under the benefit of an income tax treaty or
(ii) IRS
Form W-8ECI
(or successor form) stating that interest paid on the exchange
note is not subject to withholding tax because it is effectively
connected with such holders conduct of a trade or business
in the United States.
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If a
non-U.S. Holder
is engaged in a trade or business in the United States and
interest on the notes is effectively connected with the conduct
of that trade or business (and, if required by an applicable
income tax treaty, is attributable to a permanent establishment
in the United States maintained by such holder), such holder,
although exempt from the 30 percent withholding tax,
generally will be subject to U.S. federal income tax on
that interest on a net income basis in the same manner as if
such holder were a United States person as defined
under the Code. In addition, if a
non-U.S. Holder
is a
non-U.S. corporation,
it may be subject to a branch profits tax equal to
30 percent (or lower applicable treaty rate) of its
earnings and profits for the taxable year, subject to
adjustments, that are effectively connected with the conduct by
it of a trade or business in the United States. For this
purpose, effectively connected interest on notes will be
included in earnings and profits.
Dispositions. Any gain realized on the
disposition of an exchange note by a
non-U.S. Holder
generally will not be subject to U.S. federal income or
withholding tax unless (i) that gain is effectively
connected with the
non-U.S. Holders
conduct of a trade or business in the United States (and, if
required by an income tax treaty, is attributable to a
U.S. permanent establishment maintained by such
non-U.S. Holder),
(ii) such holder is an individual who is present in the
United States for 183 days or more in the taxable year of
that disposition and certain other conditions are met, or
(iii) in the case of disposition proceeds representing
accrued interest, the
non-U.S. Holder
cannot satisfy the requirements of the complete exemption from
withholding tax described above (and the
non-U.S. Holders
U.S. federal income tax liability has not otherwise been
fully satisfied through the U.S. federal withholding tax
described above).
If a
non-U.S. Holders
gain is effectively connected with such holders
U.S. trade or business (and, if required by an applicable
income tax treaty, is attributable to a U.S. permanent
establishment maintained by such holder), such holder generally
will be required to pay U.S. federal income tax on the net
gain derived from the sale in the same manner as if it were a
United States person as defined under the Code. If
such a
non-U.S. Holder
is a corporation, such holder may also, under certain
circumstances, be subject to a branch profits tax at a
30 percent rate (or lower applicable treaty rate). If a
non-U.S. Holder
is subject to the
183-day rule
described above, such holder generally will be subject to
U.S. federal income tax at a flat rate of 30 percent
(or a reduced rate under an applicable treaty) on the amount by
which capital gains allocable to U.S. sources (including
gains from the sale, exchange, retirement or other disposition
of the exchange note) exceed capital losses allocable to
U.S. sources, even though the
non-U.S. Holder
is not considered a resident alien under the Code.
U.S. Federal Estate Tax with respect to the Exchange
Notes. If you are an individual and are not a
U.S. citizen or a resident of the United States (as
specially defined for U.S. federal estate tax purposes) at
the time of your death, your exchange notes generally will not
be subject to the U.S. federal estate tax, unless, at the
time of your death:
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the holder directly or indirectly, actually or constructively,
owns 10 percent or more of the total combined voting power
of all classes of our stock entitled to vote within the meaning
of section 871(h)(3) of the Code and the Treasury
regulations thereunder; or
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the holders interest on the notes is effectively connected
with such holders conduct of a U.S. trade or business.
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Information
Reporting and Backup Withholding
In general, information reporting requirements apply to interest
paid to, and to the proceeds of a sale or other disposition of
an exchange note (including a redemption) by, certain
U.S. Holders. In addition, backup withholding applies to a
non-corporate U.S. Holder unless such holder provides a
correct taxpayer identification number and otherwise complies
with applicable requirements of the backup withholding rules.
Backup withholding generally does not apply to payments made to
certain exempt U.S. persons. In general, a
non-U.S. Holder
will not be subject to backup withholding and information
reporting with respect to interest payments that we make to such
holder provided that we have received from such holder the
certification described above under
Non-U.S. Holders
Interest and neither we nor our paying agent has actual
knowledge or reason to know that you are a U.S. Holder.
However, we or our paying agent may be required to report to the
IRS and the
non-U.S. Holder
payments of interest on the notes and the amount of tax, if any,
withheld with respect to those payments. Copies of the
information returns reporting such interest payments and any
withholding may also be made available to the tax authorities in
the country in which the
non-U.S. Holder
resides under the provisions of a treaty or agreement.
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Payments of the proceeds of a sale or other disposition
(including a redemption) of the notes made to or through a
non-U.S. office
of
non-U.S. financial
intermediaries that do not have certain enumerated connections
with the United States generally will not be subject to
information reporting or backup withholding. In addition, a
non-U.S. Holder
will not be subject to backup withholding or information
reporting with respect to the proceeds of the sale or other
disposition of a note within the United States or conducted
through
non-U.S. financial
intermediaries with certain enumerated connections with the
United States, if the payor receives the certification described
above under
Non-U.S. Holders
Interest or such holder otherwise establishes an
exemption, provided that the payor does not have actual
knowledge or reason to know that the
non-U.S. Holder
is a United States person or the conditions of any other
exemption are not, in fact, satisfied.
Backup withholding is not an additional tax. Any amounts
withheld under the backup withholding rules will be allowed as a
refund or credit against a holders U.S. federal
income tax liability provided the required information is
furnished by such holder to the IRS in a timely manner.
PLAN OF
DISTRIBUTION
Each broker-dealer that receives exchange notes for its own
account pursuant to the exchange offer must acknowledge that it
will deliver a prospectus in connection with any resale of such
exchange notes. This prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer
in connection with resales of exchange notes received in
exchange for unregistered notes where such unregistered notes
were acquired as a result of market-making activities or other
trading activities. We have agreed to use commercially
reasonable best efforts to keep the registration statement, of
which this prospectus forms a part, continuously effective,
supplemented and amended to the extent necessary to ensure that
it is available for resales of the notes acquired by
broker-dealers for their own accounts as a result of
market-making activities or other trading activities, and to
ensure that it conforms in all material respects with the
requirements of the registration rights agreement, the
Securities Act and the policies, rules and regulations of the
SEC as announced from time to time, for a period ending on the
earlier of (i) 180 days from the date on which this
registration statement is declared effective and (ii) the
date on which a broker-dealer is no longer required to deliver a
prospectus in connection with market-making or other trading
activities.
We will not receive any proceeds from any sale of exchange notes
by broker-dealers. Exchange notes received by broker-dealers for
their own account pursuant to the exchange offer may be sold
from time to time in one or more transactions in the
over-the-counter
market, in negotiated transactions or a combination of such
methods of resale, at market prices prevailing at the time of
resale, at prices related to such prevailing market prices or at
negotiated prices. Any such resale may be made directly to
purchasers or to or through brokers or dealers that may receive
compensation in the form of commissions or concessions from any
such broker-dealer or the purchasers of any such exchange notes.
Any broker-dealer that resells exchange notes that were received
by it for its own account pursuant to the exchange offer and any
broker or dealer that participates in a distribution of such
exchange notes may be deemed to be an underwriter
within the meaning of the Securities Act and any profit on any
such resale of exchange notes and any commission or concessions
received by any such persons may be deemed to be underwriting
compensation under the Securities Act. The letter of transmittal
states that, by acknowledging that it will deliver and by
delivering a prospectus, a broker-dealer will not be deemed to
admit that it is an underwriter within the meaning
of the Securities Act.
LEGAL
MATTERS
Certain legal matters regarding the validity of the exchange
notes will be passed upon for us by Mayer Brown LLP, Chicago,
Illinois.
EXPERTS
The consolidated financial statements of Republic Services, Inc.
included in Republic Services, Inc.s Annual Report
(Form 10-K)
for the year ended December 31, 2009, and the effectiveness
of Republic Services, Inc.s internal control over
financial reporting as of December 31, 2009 have been
audited by Ernst & Young LLP, independent registered
public accounting firm, as set forth in their reports thereon,
included therein, and incorporated herein by reference. Such
consolidated financial statements are incorporated herein by
reference in reliance upon such reports given on the authority
of such firm as experts in accounting and auditing.
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WHERE YOU
CAN FIND MORE INFORMATION
We have filed a registration statement on
Form S-4
with the SEC under the Securities Act to register the securities
offered by means of this prospectus. This prospectus, which is a
part of the registration statement, does not contain all of the
information identified in the registration statement. For
further information about us and the securities offered by means
of this prospectus, we refer you to the registration statement
and the exhibits filed as a part of the registration statement.
If a contract or document has been filed as an exhibit to the
registration statement, we refer you to the copy of the contract
or document that has been filed.
We are subject to the information and periodic reporting
requirements of the Securities Exchange Act of 1934. In
accordance with those requirements, we file annual, quarterly
and special reports, proxy statements and other information with
the SEC. You can read and copy any document we file at the
SECs public reference rooms at the following location:
100 F Street, N.E.
Washington, D.C., 20549
You can request copies of these documents upon payment of a
duplicating fee by writing to the SEC. Please call the SEC at
1-800-SEC-0330
for further information on the operation of the public reference
rooms and the procedure for obtaining copies.
The SEC maintains an Internet site that contains reports, proxy
and information statements, and other information regarding
issuers that file electronically with the SEC. The documents
that we file with the SEC, including the registration statement,
are available to investors on this web site. You can log onto
the SECs web site at
http://www.sec.gov.
Our common stock is listed on the New York Stock Exchange (NYSE:
RSG), and you can obtain information about us at the offices of
the New York Stock Exchange, 20 Broad Street, New York, NY
10005. Certain information is also available on our website at
http://www.republicservices.com.
INCORPORATION
BY REFERENCE
We file annual, quarterly and special reports and other
information with the SEC. See Where You Can Find More
Information. The following documents are incorporated into
this prospectus by reference:
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Republics Annual Report on
Form 10-K
for the year ended December 31, 2009;
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Republics Quarterly Report on
Form 10-Q
for the three months ended March 31, 2010;
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Republics Current Reports on
Form 8-K,
dated January 4, 2010, January 6, 2010,
February 12, 2010, March 1, 2010 (relating to
item 8.01 which is filed with the SEC), March 1, 2010
(relating to item 2.03 which is filed with the SEC),
March 4, 2010, May 14, 2010 and June 28,
2010; and
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All documents filed by us under Section 13(a), 13(c), 14 or
15(d) of the Exchange Act on or after the date of this
prospectus until the exchange offer is terminated (other than
Current Reports on
Form 8-K
or portions thereof furnished under Item 2.02 or 7.01 of
Form 8-K and
portions of other documents which under applicable securities
laws are deemed furnished and not filed with the SEC).
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Any information incorporated by reference is considered part of
this prospectus, and any information that we file with the SEC
subsequent to the filing of the incorporated material or the
date of this prospectus will automatically update and, if
applicable, supercede the incorporated information and this
prospectus.
You may obtain a copy of these filings, including exhibits (but
not including exhibits that are specifically incorporated by
reference), free of charge, by oral or written request directed
to: Republic Services, Inc., 18500 North Allied Way, Phoenix, AZ
85054, Attention: Investor Relations, Phone:
(480) 627-2700.
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