UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(D)
OF THE SECURITIES EXCHANGE ACT OF 1934
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| Item 1.01 | Entry into a Material Definitive Agreement. |
On August 9, 2024 (the “Closing Date”), Quanta Services, Inc. (the “Company”) issued (i) $600,000,000 aggregate principal amount of its 4.750% Senior Notes due 2027 (the “2027 Notes”) and (ii) $650,000,000 aggregate principal amount of its 5.250% Senior Notes due 2034 (the “2034 Notes,” and together with the 2027 Notes, the “Notes”). The Notes were sold pursuant to an underwriting agreement, dated as of August 7, 2024 (the “Underwriting Agreement”), by and among the Company and BofA Securities, Inc., Wells Fargo Securities, LLC, J.P. Morgan Securities LLC, PNC Capital Markets LLC and Truist Securities, Inc., as representatives of the several underwriters named in Schedule A to the Underwriting Agreement, as previously reported on the Company’s Current Report on Form 8-K filed on August 7, 2024.
The 2027 Notes were issued under the indenture, dated as of September 22, 2020, between the Company, as issuer, and U.S. Bank Trust Company, National Association (as successor in interest to U.S. Bank National Association), as trustee (the “Trustee”) (the “Base Indenture”), as supplemented and amended by the fifth supplemental indenture, dated as of August 9, 2024, between the Company and the Trustee (the “Fifth Supplemental Indenture”). The 2034 Notes were issued under the Base Indenture, as supplemented and amended by the sixth supplemental indenture, dated as of August 9, 2024, between the Company and the Trustee (the “Sixth Supplemental Indenture,” and together with the Base Indenture and Fifth Supplemental Indenture, the “Indenture”). Interest on the 2027 Notes will accrue at a rate of 4.750% per annum and is payable semi-annually, in arrears, on February 9 and August 9 of each year, commencing February 9, 2025. The 2027 Notes will mature on August 9, 2027, unless earlier redeemed. Interest on the 2034 Notes will accrue at a rate of 5.250% per annum and is payable semi-annually, in arrears, on February 9 and August 9 of each year, commencing February 9, 2025. The 2034 Notes will mature on August 9, 2034, unless earlier redeemed.
The Notes are the Company’s senior unsecured obligations and rank equally in right of payment with the Company’s existing and future senior unsecured indebtedness. The Notes are effectively junior to the Company’s existing and future secured indebtedness to the extent of the value of the assets securing such indebtedness. The Notes are not guaranteed by any of the Company’s subsidiaries and are therefore structurally subordinated to all of the existing and future indebtedness and other liabilities of the Company’s subsidiaries, including trade payables.
Prior to July 9, 2027 (one month prior to their maturity date), the 2027 Notes will be redeemable, at the Company’s option, in whole or in part, at any time and from time to time, at a price equal to the greater of (a) (i) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2027 Notes matured on the Par Call Date (as defined in the Fifth Supplemental Indenture)) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Fifth Supplemental Indenture) plus 15 basis points less (ii) interest accrued to the date of redemption and (b) 100% of the principal amount of the 2027 Notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to (but excluding) the redemption date. Commencing on July 9, 2027, the Company may redeem the 2027 Notes, in whole or in part, at any time and from time to time, at the Company’s option, at a redemption price equal to 100% of the principal amount of the 2027 Notes being redeemed plus accrued and unpaid interest thereon to (but excluding) the redemption date. Prior to May 9, 2034 (three months prior to their maturity date), the 2034 Notes will be redeemable, at the Company’s option, in whole or in part, at any time and from time to time, at a price equal to the greater of (a) (i) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2034 Notes matured on the Par Call Date (as defined in the Sixth Supplemental Indenture)) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate (as defined in the Sixth Supplemental Indenture) plus 25 basis points less (ii) interest accrued to the date of redemption and (b) 100% of the principal amount of the 2034 Notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to (but excluding) the redemption date. Commencing on May 9, 2034, the Company may redeem the 2034 Notes, in whole or in part, at any time and from time to time, at the Company’s option, at a redemption price equal to 100% of the principal amount of the 2034 Notes being redeemed plus accrued and unpaid interest thereon to (but excluding) the redemption date.
Upon the occurrence of a Change of Control Triggering Event (as defined in the Indenture), unless the Company has exercised its right to redeem the Notes in full by giving irrevocable notice to the Trustee in accordance with the Indenture, each holder of the Notes will have the right to require the Company to purchase all or a portion (equal to $2,000 or whole multiples of $1,000 in excess thereof) of such holder’s Notes at a purchase price equal to 101% of the principal amount thereof plus accrued and unpaid interest thereon to (but excluding) the date of purchase.
The Indenture contains covenants that, among other things, limit the Company’s ability to incur liens securing certain indebtedness, to engage in certain sale and leaseback transactions with respect to certain properties and to sell all or substantially all of the Company’s assets or merge or consolidate with or into other companies. The Indenture also contains customary events of default.
The foregoing description of the Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the Base Indenture, the Fifth Supplemental Indenture, the Sixth Supplemental Indenture, the form of 2027 Note and the form of 2034 Note, copies of which are filed as Exhibits 4.1, 4.2, 4.3, 4.4 and 4.5, respectively, to this Current Report on Form 8-K and are incorporated herein by reference.
| Item 2.03 | Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant. |
The information set forth in Item 1.01 of this Current Report on Form 8-K with respect to the Indenture and the Notes is incorporated herein by reference in its entirety.
| Item 9.01 | Financial Statements and Exhibits. |
(d) Exhibits.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Dated August 9, 2024 | Quanta Services, Inc. | |||||
| By: | /s/ Jayshree Desai | |||||
| Name: | Jayshree Desai | |||||
| Title: | Chief Financial Officer | |||||