[8-K] RGC Resources Inc Reports Material Event
RGC Resources, Inc. (RGCO) subsidiary RGC Midstream, LLC entered a $53.6 million Credit Agreement with Atlantic Union Bank and CoBank on September 5, 2025, replacing Midstream's existing debt. The facility bears interest at one month Term SOFR plus 155 basis points with monthly interest payments and scheduled quarterly principal payments aligned with Mountain Valley Pipeline shipper agreements that expire June 2044. Resources provided a guaranty of Midstream's obligations.
Midstream also executed interest rate swaps converting $35.6 million of the variable-rate exposure to an effective fixed rate of 5.061%, and redesignated existing swaps so total hedged notional equals $53.6 million. Separately, Midstream obtained two project Notes with Atlantic Union for MVP Southgate and MVP expansion totaling potential draws of $1.85 million and $3.65 million, at Term SOFR plus 175 basis points reducible to plus 155 basis points upon project operations. The Credit and Loan Agreements include customary fees and financial covenants, including consolidated long-term indebtedness limits, priority indebtedness limits, and a minimum consolidated interest coverage ratio of 1.50 to 1.00.
RGC Resources, Inc. (RGCO), tramite la sua controllata RGC Midstream, LLC, ha sottoscritto il 5 settembre 2025 un Credit Agreement da 53,6 milioni di dollari con Atlantic Union Bank e CoBank, sostituendo l’indebitamento preesistente di Midstream. La linea prevede un tasso variabile pari al Term SOFR a un mese più 155 punti base, con interessi pagabili mensilmente e rimborsi di capitale programmati su base trimestrale in linea con gli accordi di shipper del Mountain Valley Pipeline, in scadenza a giugno 2044. RGC Resources ha rilasciato una garanzia per le obbligazioni di Midstream.
Midstream ha inoltre stipulato swap sui tassi di interesse per convertire 35,6 milioni di esposizione a tasso variabile in un tasso effettivo fisso del 5,061% e ha riallocato swap esistenti in modo che il notional coperto totale sia pari a 53,6 milioni. Separatamente, Midstream ha ottenuto da Atlantic Union due note di progetto per MVP Southgate e l’espansione MVP, con possibili erogazioni rispettivamente di 1,85 milioni e 3,65 milioni di dollari, a Term SOFR più 175 punti base riducibili a 155 al momento dell’avvio operativo dei progetti. Gli accordi di credito e di prestito prevedono commissioni consuete e covenant finanziari, tra cui limiti sul debito a lungo termine consolidato, limiti sul debito prioritario e un indice minimo di copertura degli interessi consolidato di 1,50 a 1,00.
RGC Resources, Inc. (RGCO), a través de su subsidiaria RGC Midstream, LLC, firmó el 5 de septiembre de 2025 un acuerdo de crédito por 53,6 millones de dólares con Atlantic Union Bank y CoBank, reemplazando la deuda previa de Midstream. La facilidad devenga interés a Term SOFR a un mes más 155 puntos básicos, con pagos de intereses mensuales y amortizaciones de capital programadas trimestralmente, alineadas con los contratos de transporte del Mountain Valley Pipeline que vencen en junio de 2044. Resources otorgó una garantía de las obligaciones de Midstream.
Midstream también ejecutó swaps de tasas para convertir 35,6 millones de exposición variable a una tasa fija efectiva del 5,061% y redesignó swaps existentes de modo que el nocional cubierto total sea 53,6 millones. Por separado, Midstream obtuvo dos notas de proyecto con Atlantic Union para MVP Southgate y la expansión de MVP, con posibles disposiciones de 1,85 millones y 3,65 millones respectivamente, a Term SOFR más 175 puntos básicos, reducibles a 155 cuando los proyectos entren en operación. Los acuerdos de crédito y préstamo incluyen comisiones habituales y convenios financieros, entre ellos límites de deuda a largo plazo consolidada, límites de deuda prioritaria y un ratio mínimo consolidado de cobertura de intereses de 1,50 a 1,00.
RGC Resources, Inc. (RGCO)의 자회사 RGC Midstream, LLC는 2025년 9월 5일 Atlantic Union Bank 및 CoBank와 5,360만 달러 규모의 신용계약을 체결하여 기존 채무를 대체했습니다. 이 대출은 1개월 Term SOFR에 155베이시스 포인트를 더한 변동금리를 적용하며 이자는 월별로 지급되고 원금은 Mountain Valley Pipeline의 shipper 계약 만기(2044년 6월)에 맞춰 분기별로 상환됩니다. RGC Resources가 Midstream의 채무를 보증했습니다.
Midstream은 또한 이자율 스왑을 실행해 변동금리 노출 3,560만 달러를 유효 고정금리 5.061%로 전환했고, 기존 스왑을 재지정하여 총 헤지 대상 명목액이 5,360만 달러가 되도록 했습니다. 별도로 Midstream은 Atlantic Union으로부터 MVP Southgate 및 MVP 확장 프로젝트를 위한 두 건의 프로젝트 노트를 확보했으며, 각각 최대 인출액은 185만 달러와 365만 달러이고 금리는 Term SOFR에 175bp를 더하되 프로젝트 가동 시 155bp로 낮아질 수 있습니다. 신용 및 대출 계약에는 통상 수수료와 재무 약정(연결 장기부채 한도, 우선채무 한도, 최소 연결 이자보상비율 1.50:1.00 등)이 포함됩니다.
RGC Resources, Inc. (RGCO), par l’intermédiaire de sa filiale RGC Midstream, LLC, a conclu le 5 septembre 2025 un accord de crédit de 53,6 millions de dollars avec Atlantic Union Bank et CoBank, remplaçant la dette existante de Midstream. La facilité porte un intérêt au Term SOFR à un mois plus 155 points de base, avec paiements d’intérêts mensuels et remboursements de capital programmés trimestriellement, alignés sur les contrats d’expédition du Mountain Valley Pipeline arrivant à échéance en juin 2044. Resources a fourni une garantie des obligations de Midstream.
Midstream a en outre exécuté des swaps de taux d’intérêt convertissant 35,6 millions d’exposition à taux variable en un taux fixe effectif de 5,061%, et a requalifié des swaps existants pour que le notional total couvert s’élève à 53,6 millions. Par ailleurs, Midstream a obtenu deux billets de projet auprès d’Atlantic Union pour MVP Southgate et l’expansion de MVP, avec des tirages potentiels de 1,85 million et 3,65 millions de dollars, au Term SOFR plus 175 points de base, réduits à plus 155 points de base à la mise en service des projets. Les accords de crédit et de prêt comprennent les frais usuels et des engagements financiers, notamment des limites d’endettement consolidé à long terme, des limites d’endettement prioritaire et un ratio minimum consolidé de couverture des intérêts de 1,50 à 1,00.
RGC Resources, Inc. (RGCO)-Tochter RGC Midstream, LLC schloss am 5. September 2025 eine Kreditvereinbarung über 53,6 Millionen US-Dollar mit Atlantic Union Bank und CoBank ab und ersetzte damit die bestehende Verschuldung von Midstream. Die Facility verzinst sich mit dem einmonatigen Term SOFR zuzüglich 155 Basispunkte, Zinsen sind monatlich fällig, die planmäßigen Kapitalrückzahlungen erfolgen vierteljährlich und sind an die Shipper-Verträge der Mountain Valley Pipeline gebunden, die im Juni 2044 auslaufen. Resources stellte eine Bürgschaft für die Verpflichtungen von Midstream.
Midstream schloss zudem Zinsswaps ab, um 35,6 Millionen der variablen Zinsposition in einen effektiven Festzins von 5,061% zu wandeln, und redesignierte bestehende Swaps, sodass das insgesamt gehedgte Nominal 53,6 Millionen beträgt. Separat erhielt Midstream zwei Projekt-Notes von Atlantic Union für MVP Southgate und die MVP-Erweiterung mit potenziellen Abrufen von 1,85 Millionen bzw. 3,65 Millionen US-Dollar, jeweils zu Term SOFR plus 175 Basispunkte, die bei Inbetriebnahme der Projekte auf plus 155 Basispunkte reduziert werden können. Die Kredit- und Darlehensverträge enthalten übliche Gebühren und finanzielle Covenants, darunter Grenzen für die konsolidierte langfristige Verschuldung, Grenzen für vorrangige Schulden und ein Mindestzinssdeckungsgrad von 1,50 zu 1,00.
- $53.6 million refinance replaces existing debt, simplifying capital structure and refinancing risk
- Interest rate swaps convert $35.6 million to fixed rate and, combined with existing swaps, hedge the full $53.6 million notional
- Principal schedule aligned with MVP shipper agreements, matching debt service to contracted revenue timing
- Parent guaranty provides additional lender support which may lower borrowing costs or improve terms
- Financial covenants (65% long-term indebtedness cap, 15% priority indebtedness cap, 1.50x interest coverage) may constrain operational flexibility
- Portion of project financing ($1.85M and $3.65M) carries a higher initial spread (SOFR+175bps) until projects commence, exposing timing risk
- Parent exposure increases because Resources guaranteed Midstream obligations, concentrating credit risk at the parent level
Insights
TL;DR: Refinance reduces immediate refinancing risk and locks fixed-rate exposure on most debt, supporting cashflow predictability.
The $53.6 million refinance replaces prior debt and centralizes bank relationships with Atlantic Union and CoBank. Converting $35.6 million to a fixed effective 5.061% rate and redesignating swaps to cover the full $53.6 million reduces Midstream's exposure to short-term rate volatility, improving interest expense visibility. Quarterly principal amortization matched to MVP shipper agreements aligns debt service with contracted cash inflows, which is credit-positive if shipper volumes and payments remain as contracted. The parent guaranty enhances lender comfort but also places Resources on the hook for Midstream obligations, consolidating credit risk at the parent level.
TL;DR: Hedging and scheduled amortization lower market risk but covenants and project-linked pricing retain operational and covenant risk.
The interest rate swaps materially reduce interest-rate risk for the hedged notional, yet a portion of exposure remains variable until project milestones reduce margins. The project Notes carry a higher spread until operations commence, tying future borrowing costs to project execution. Financial covenants such as a 65% consolidated long-term indebtedness cap and a 1.50x interest coverage floor could constrain flexibility if cashflows weaken. Monitoring covenant headroom and MVP shipper performance will be important to assess covenant compliance risk.
RGC Resources, Inc. (RGCO), tramite la sua controllata RGC Midstream, LLC, ha sottoscritto il 5 settembre 2025 un Credit Agreement da 53,6 milioni di dollari con Atlantic Union Bank e CoBank, sostituendo l’indebitamento preesistente di Midstream. La linea prevede un tasso variabile pari al Term SOFR a un mese più 155 punti base, con interessi pagabili mensilmente e rimborsi di capitale programmati su base trimestrale in linea con gli accordi di shipper del Mountain Valley Pipeline, in scadenza a giugno 2044. RGC Resources ha rilasciato una garanzia per le obbligazioni di Midstream.
Midstream ha inoltre stipulato swap sui tassi di interesse per convertire 35,6 milioni di esposizione a tasso variabile in un tasso effettivo fisso del 5,061% e ha riallocato swap esistenti in modo che il notional coperto totale sia pari a 53,6 milioni. Separatamente, Midstream ha ottenuto da Atlantic Union due note di progetto per MVP Southgate e l’espansione MVP, con possibili erogazioni rispettivamente di 1,85 milioni e 3,65 milioni di dollari, a Term SOFR più 175 punti base riducibili a 155 al momento dell’avvio operativo dei progetti. Gli accordi di credito e di prestito prevedono commissioni consuete e covenant finanziari, tra cui limiti sul debito a lungo termine consolidato, limiti sul debito prioritario e un indice minimo di copertura degli interessi consolidato di 1,50 a 1,00.
RGC Resources, Inc. (RGCO), a través de su subsidiaria RGC Midstream, LLC, firmó el 5 de septiembre de 2025 un acuerdo de crédito por 53,6 millones de dólares con Atlantic Union Bank y CoBank, reemplazando la deuda previa de Midstream. La facilidad devenga interés a Term SOFR a un mes más 155 puntos básicos, con pagos de intereses mensuales y amortizaciones de capital programadas trimestralmente, alineadas con los contratos de transporte del Mountain Valley Pipeline que vencen en junio de 2044. Resources otorgó una garantía de las obligaciones de Midstream.
Midstream también ejecutó swaps de tasas para convertir 35,6 millones de exposición variable a una tasa fija efectiva del 5,061% y redesignó swaps existentes de modo que el nocional cubierto total sea 53,6 millones. Por separado, Midstream obtuvo dos notas de proyecto con Atlantic Union para MVP Southgate y la expansión de MVP, con posibles disposiciones de 1,85 millones y 3,65 millones respectivamente, a Term SOFR más 175 puntos básicos, reducibles a 155 cuando los proyectos entren en operación. Los acuerdos de crédito y préstamo incluyen comisiones habituales y convenios financieros, entre ellos límites de deuda a largo plazo consolidada, límites de deuda prioritaria y un ratio mínimo consolidado de cobertura de intereses de 1,50 a 1,00.
RGC Resources, Inc. (RGCO)의 자회사 RGC Midstream, LLC는 2025년 9월 5일 Atlantic Union Bank 및 CoBank와 5,360만 달러 규모의 신용계약을 체결하여 기존 채무를 대체했습니다. 이 대출은 1개월 Term SOFR에 155베이시스 포인트를 더한 변동금리를 적용하며 이자는 월별로 지급되고 원금은 Mountain Valley Pipeline의 shipper 계약 만기(2044년 6월)에 맞춰 분기별로 상환됩니다. RGC Resources가 Midstream의 채무를 보증했습니다.
Midstream은 또한 이자율 스왑을 실행해 변동금리 노출 3,560만 달러를 유효 고정금리 5.061%로 전환했고, 기존 스왑을 재지정하여 총 헤지 대상 명목액이 5,360만 달러가 되도록 했습니다. 별도로 Midstream은 Atlantic Union으로부터 MVP Southgate 및 MVP 확장 프로젝트를 위한 두 건의 프로젝트 노트를 확보했으며, 각각 최대 인출액은 185만 달러와 365만 달러이고 금리는 Term SOFR에 175bp를 더하되 프로젝트 가동 시 155bp로 낮아질 수 있습니다. 신용 및 대출 계약에는 통상 수수료와 재무 약정(연결 장기부채 한도, 우선채무 한도, 최소 연결 이자보상비율 1.50:1.00 등)이 포함됩니다.
RGC Resources, Inc. (RGCO), par l’intermédiaire de sa filiale RGC Midstream, LLC, a conclu le 5 septembre 2025 un accord de crédit de 53,6 millions de dollars avec Atlantic Union Bank et CoBank, remplaçant la dette existante de Midstream. La facilité porte un intérêt au Term SOFR à un mois plus 155 points de base, avec paiements d’intérêts mensuels et remboursements de capital programmés trimestriellement, alignés sur les contrats d’expédition du Mountain Valley Pipeline arrivant à échéance en juin 2044. Resources a fourni une garantie des obligations de Midstream.
Midstream a en outre exécuté des swaps de taux d’intérêt convertissant 35,6 millions d’exposition à taux variable en un taux fixe effectif de 5,061%, et a requalifié des swaps existants pour que le notional total couvert s’élève à 53,6 millions. Par ailleurs, Midstream a obtenu deux billets de projet auprès d’Atlantic Union pour MVP Southgate et l’expansion de MVP, avec des tirages potentiels de 1,85 million et 3,65 millions de dollars, au Term SOFR plus 175 points de base, réduits à plus 155 points de base à la mise en service des projets. Les accords de crédit et de prêt comprennent les frais usuels et des engagements financiers, notamment des limites d’endettement consolidé à long terme, des limites d’endettement prioritaire et un ratio minimum consolidé de couverture des intérêts de 1,50 à 1,00.
RGC Resources, Inc. (RGCO)-Tochter RGC Midstream, LLC schloss am 5. September 2025 eine Kreditvereinbarung über 53,6 Millionen US-Dollar mit Atlantic Union Bank und CoBank ab und ersetzte damit die bestehende Verschuldung von Midstream. Die Facility verzinst sich mit dem einmonatigen Term SOFR zuzüglich 155 Basispunkte, Zinsen sind monatlich fällig, die planmäßigen Kapitalrückzahlungen erfolgen vierteljährlich und sind an die Shipper-Verträge der Mountain Valley Pipeline gebunden, die im Juni 2044 auslaufen. Resources stellte eine Bürgschaft für die Verpflichtungen von Midstream.
Midstream schloss zudem Zinsswaps ab, um 35,6 Millionen der variablen Zinsposition in einen effektiven Festzins von 5,061% zu wandeln, und redesignierte bestehende Swaps, sodass das insgesamt gehedgte Nominal 53,6 Millionen beträgt. Separat erhielt Midstream zwei Projekt-Notes von Atlantic Union für MVP Southgate und die MVP-Erweiterung mit potenziellen Abrufen von 1,85 Millionen bzw. 3,65 Millionen US-Dollar, jeweils zu Term SOFR plus 175 Basispunkte, die bei Inbetriebnahme der Projekte auf plus 155 Basispunkte reduziert werden können. Die Kredit- und Darlehensverträge enthalten übliche Gebühren und finanzielle Covenants, darunter Grenzen für die konsolidierte langfristige Verschuldung, Grenzen für vorrangige Schulden und ein Mindestzinssdeckungsgrad von 1,50 zu 1,00.
FAQ
What debt did RGC Midstream incur and for what amount?
What interest rates apply to the new facilities for RGCO/Midstream?
When do the loans mature and how is principal repaid?
Does RGC Resources guarantee Midstream's debt?
What covenants did Midstream agree to under the Credit and Loan Agreements?
