Business Context and Reporting Period
This Form 8-K Current Report was filed by Verra Mobility Corporation on March 19, 2021. The filing details the entry into a material definitive agreement regarding a new debt issuance by VM Consolidated Inc., a wholly-owned indirect subsidiary of the Company.
Key Financial Metrics and Transaction Details
- Debt Issuance: $350 million aggregate principal amount of senior notes due 2029.
- Interest Rate: 5.50% per year, payable semi-annually in arrears.
- Net Proceeds: Estimated at approximately $340 million after deducting fees and expenses.
- Expected Closing Date: On or about March 26, 2021.
- Revenue/Profit/Cash Flow: The filing text does not provide a clear value for current period revenue, profit, or operating cash flow metrics.
Material Changes and Use of Proceeds
The Company intends to utilize the net proceeds from the notes, combined with cash on hand and proceeds from an amended term loan facility, for the following purposes:
- Refinance all outstanding term loans and accrued interest under the First Lien Term Credit Agreement dated March 1, 2018.
- Pay approximately $113 million of cash purchase consideration for the proposed acquisition of Redflex Holdings Limited.
- Cover fees and expenses related to the refinancing and the notes offering.
- General corporate purposes.
Outlook, Risks, and Management Commentary
The offering is subject to the satisfaction of customary closing conditions. The Company has entered into a purchase agreement with BofA Securities, Inc., acting as representative for initial purchasers. The transaction involves a private offering to qualified institutional buyers under Rule 144A and to persons outside the United States under Regulation S. No specific forward-looking guidance regarding future revenue or earnings was included in this specific filing.
Key Facts for Investor Verification
- Verify the final closing of the $350 million senior notes offering on or about March 26, 2021.
- Confirm the successful execution of the amendment and restatement of the First Lien Term Credit Agreement to secure additional term loan proceeds.
- Monitor the status of the proposed acquisition of Redflex Holdings Limited and the deployment of the $113 million cash consideration.
- Review the full text of the Purchase Agreement (Exhibit 1.1) for specific covenants and indemnification terms.