Covanta Holding Corporation (NYSE: CVA) today announced that it has priced $335 million in new tax exempt bonds to refinance outstanding tax exempt bonds of the same amounts and maturities. The new bonds have a weighted average coupon of 4.58% across maturities up to 2042, representing a weighted average tenor of 21 years. Descriptions of both series of bonds are listed below.

The new bonds are unsecured obligations of Covanta Holding Corporation and are not guaranteed by any of our subsidiaries, whereas the outstanding bonds are guaranteed by our subsidiary, Covanta Energy LLC. The transaction is subject to customary conditions to closing, which is expected to occur on September 27, 2018.

The transaction lowers the weighted average coupon on the bonds by over 40 basis points, and as a result of the removal of upstream subsidiary guarantees, will lower the leverage ratio under our senior secured credit facilities on a pro forma basis, with an expected corresponding reduction in the cost of borrowings under the revolving credit facility by a further 12.5 basis points.

"This refinancing transaction presented a unique opportunity to lower our overall cost of debt, simplify our capital structure, and increase our senior borrowing capacity and flexibility – all while maintaining an extremely attractive term structure that is not available to us in any other market," said Bradford J. Helgeson, Covanta's CFO. "We will continue to look for opportunities to optimize our capital structure over time."

Description of the new bonds

• $20,000,000 4.00% National Finance Authority (New Hampshire) Resource Recovery Refunding Revenue Bonds (Covanta Project) Series 2018A (AMT) due November 1, 2027;
• $67,225,000 4.625% National Finance Authority (New Hampshire) Resource Recovery Refunding Revenue Bonds (Covanta Project) Series 2018BA (Non-AMT) due November 1, 2042;
• $82,370,000 4.875% National Finance Authority (New Hampshire) Resource Recovery Refunding Revenue Bonds (Covanta Project) Series 2018C (AMT) due November 1, 2042;
• $130,000,000 4.75% Niagara Area Development Corporation (New York) Solid Waste Disposal Facility Refunding Revenue Bonds (Covanta Project) Series 2018A (AMT) due November 1, 2042;
• $35,010,000 3.50% Niagara Area Development Corporation (New York) Solid Waste Disposal Facility Refunding Revenue Bonds (Covanta Project) Series 2018B (Non-AMT) due November 1, 2024 (collectively, the "Series 2018 Tax Exempt Bonds").

Description of the outstanding bonds

• $20,000,000 4.875% Massachusetts Development Finance Agency Resource Recovery Refunding Revenue Bonds (Covanta Project) Series 2012A (AMT) due November 1, 2027;
• $67,225,000 4.875% Massachusetts Development Finance Agency Resource Recovery Refunding Revenue Bonds (Covanta Project) Series 2012B (Non-AMT) due November 1, 2042;
• $82,370,000 5.25% Massachusetts Development Finance Agency Resource Recovery Refunding Revenue Bonds (Covanta Project) Series 2012C (AMT) due November 1, 2042;
• $130,000,000 5.25% Niagara Area Development Corporation (New York) Solid Waste Disposal Facility Refunding Revenue Bonds (Covanta Project) Series 2012A (AMT) due November 1, 2042;
• $35,010,000 4.00% Niagara Area Development Corporation (New York) Solid Waste Disposal Facility Refunding Revenue Bonds (Covanta Project) Series 2012B (Non-AMT) due November 1, 2024 (collectively, the "Series 2012 Tax Exempt Bonds").

About Covanta

Covanta is a world leader in providing sustainable waste and energy solutions. Annually, Covanta's modern Energy-from-Waste facilities safely convert approximately 20 million tons of waste from municipalities and businesses into clean, renewable electricity to power one million homes and recycle approximately 600,000 tons of metal. Through a vast network of treatment and recycling facilities, Covanta also provides comprehensive industrial material management services to companies seeking solutions to some of today's most complex environmental challenges. For more information, visit covanta.com.