| Item 1.01 |
Entry into a Material Definitive Agreement. |
Senior Notes Due 2034
On February 27, 2026, Advanced Drainage Systems, Inc. (the “Company”) issued $500.0 million aggregate principal amount of its 5.375% senior notes due 2034 (the “Notes”) pursuant to an Indenture, dated February 27, 2026 (the “Indenture”), among the Company, the guarantors party thereto (as defined below, the “Guarantors”) and U.S. Bank Trust Company, National Association, as Trustee (the “Trustee”). The Notes are guaranteed by each of the Company’s present and future direct and indirect wholly owned domestic subsidiaries that is a guarantor under the Company’s senior secured credit facility. The Notes were offered and sold either to persons reasonably believed to be “qualified institutional buyers” pursuant to Rule 144A under the Securities Act of 1933 (the “Securities Act”) or to persons outside the United States under Regulation S of the Securities Act.
Interest on the Notes will be payable semi-annually in cash in arrears on March 1 and September 1 of each year, commencing on September 1, 2026, at a rate of 5.375% per annum. The Notes will mature on March 1, 2034. The Company intends to use the net proceeds from the offering of the Notes, together with the proceeds of the term loan “B” portion of its existing senior secured credit facility, to refinance the outstanding balance of the Company’s senior secured credit facility and redeem the 5.000% senior notes due 2027 in full, with the balance for general corporate purposes.
The Company may redeem the Notes, in whole or in part, at any time on or after March 1, 2029 at certain specified redemption prices set forth in the Indenture. In addition, at any time prior to March 1, 2029, the Company may redeem the Notes, in whole or in part, at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date plus an applicable “make-whole” premium. At any time prior to March 1, 2029, the Company may also redeem up to 40% of the aggregate principal amount of Notes issued under the Indenture with net cash proceeds of certain equity offerings at a redemption price equal to 105.375% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.
The Indenture contains customary events of default, including, among other things, payment default, failure to comply with covenants or agreements contained in the Indenture or the Notes and certain provisions related to bankruptcy events. The Indenture also contains customary negative covenants.
The information contained in this Current Report, including the exhibits hereto, shall not constitute an offer to sell, or a solicitation of an offer to purchase, any Notes in any jurisdiction in which such an offer, solicitation or sale would be unlawful.
The preceding description of the Indenture and the Notes is a summary and is qualified in its entirety by the Indenture and the form of Notes, copies of which are filed as Exhibit 4.1 and Exhibit 4.2 hereto and are incorporated by reference herein.
Fourth Amendment to Credit Agreement
On February 27, 2026, the Company entered into a Fourth Amendment (the “Fourth Amendment”) to the Company’s Credit Agreement dated as of July 31, 2019 (as amended by the First Amendment to Credit Agreement, dated as of September 24, 2019, the Second Amendment to Credit Agreement, dated as of May 26, 2022, the Third Amendment to Credit Agreement, dated as of November 26, 2025 and as further amended, restated, amended and restated, supplemented or otherwise modified prior to the date hereof the “Existing Credit Agreement”, and as amended by the Fourth Amendment, the “Credit Agreement”), with Bank of America, N.A. as administrative agent under the Term Facility, PNC Bank, National Association as administrative agent under the Revolving Facility and as Successor Administrative Agent (as defined in the Fourth Amendment), Barclays Bank PLC, as Predecessor Administrative Agent (as defined in the Fourth Amendment), and the several financial institutions from time to time party thereto as lenders. The obligations of the Company under the Credit Agreement are guaranteed by certain of the Company’s subsidiaries, including Infiltrator Water Technologies, LLC, StormTech LLC and Orenco, Inc. (the “Guarantors”) and the Guarantors secure the obligations thereunder by granting a first priority lien in substantially all of such Guarantor’s assets (subject to certain exceptions and limitations).
