OPCH secures $49.6M incremental term loan and extends revolver maturity
Rhea-AI Filing Summary
Option Care Health entered into a Fourth Amendment to its First Lien Credit Agreement that refinances its existing term loans into a new seven-year tranche priced at Term SOFR plus 1.75%. The amendment also provides for incremental term loans totaling $49,639,386.20 at the same rate and maturity, and extends the maturity of the revolving credit commitments to the fifth anniversary of the amendment, subject to a springing maturity 91 days prior to the Unsecured Notes maturity if any Unsecured Notes remain outstanding. After the amendment, the principal amount of First Lien Term Loan indebtedness is approximately $678,000,000. The amendment was executed by the company and Bank of America, N.A., as administrative agent.
Positive
- Refinanced term loans at a lower rate: new loans bear interest at Term SOFR +1.75%, reducing stated spread
- Extended revolver maturity to the fifth anniversary, providing longer committed liquidity runway
- Incremental term loan capacity of $49,639,386.20 at the same economics, adding flexibility
- Seven-year maturity on refinanced term loans, extending tenor and deferring near-term principal amortization
Negative
- Springing maturity provision can accelerate revolver maturity to 91 days before Unsecured Notes maturity if those notes remain unpaid
- Material secured indebtedness remains: First Lien Term Loan principal is approximately $678,000,000 post-amendment
Insights
TL;DR: Refinancing lowers the term loan coupon and secures incremental capacity, extending revolving maturity — improves debt cost and liquidity profile.
The amendment replaces prior term loans with a new seven-year facility priced at Term SOFR +1.75%, which explicitly reduces the stated spread versus prior indebtedness as described in the filing. The incremental term loan capacity of $49.6 million provides stated additional funded capacity at the same economics. Extending the revolver to the fifth anniversary defers near-term refinancing risk, although the springing maturity tied to Unsecured Notes creates conditional acceleration risk if unsecured debt remains unpaid. The post-amendment first lien term loan balance is ~ $678 million, confirming the scale of secured leverage affected.
TL;DR: A seven-year reprice and modest incremental term loan is a constructive refinancing from a creditor-cost perspective, with typical covenant/timing trade-offs.
The transaction explicitly sets a lower floating spread of Term SOFR +1.75% for new and incremental term loans, which should reduce interest expense assuming unchanged SOFR levels. The five-year extension of revolver commitments lengthens committed liquidity runway; however, the filing notes a springing maturity mechanism tied to Unsecured Notes which could shorten revolver life contingent on unsecured note repayment status. The stated $678 million first lien term loan balance indicates material secured indebtedness remains in place post-amendment.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
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Item 1.01. Entry into a Material Definitive Agreement
On September 22, 2025, Option Care Health Inc. (the “Company”) entered into that certain Fourth Amendment to Amended and Restated First Lien Credit Agreement (the “Amendment”), by and among the Company, as borrower, certain subsidiaries of the Company party thereto, each 2025 Refinancing Term Lender, each 2025 Incremental Term Lender, each Extending Revolving Credit Lender and Bank of America, N.A., as administrative agent (the “Agent”), which amends that certain Amended and Restated First Lien Credit Agreement, dated as of October 27, 2021 (as amended by that certain First Amendment to Amended and Restated First Lien Credit Agreement, dated as of June 8, 2023, that certain Second Amendment to Amended and Restated First Lien Credit Agreement, dated as of December 7, 2023, that certain Third Amendment to Amended and Restated First Lien Credit Agreement, dated as of May 8, 2024, and the Amendment, the “Credit Agreement”), by and among the Company, as borrower, certain subsidiaries of the Company from time to time party thereto, the Lenders from time to time party thereto and the Agent. The Amendment, among other things, (i) refinances the existing term loans under the Credit Agreement with a new class of term loans bearing interest at a lower interest rate of Term SOFR plus 1.75% and maturing seven years after the effective date of the Amendment, (ii) provides for incurrence of incremental term loans in the aggregate principal amount of $49,639,386.20, which bear interest at the same interest rate and have the same maturity date as provided in the foregoing clause (i), and (iii) extends the maturity date of the revolving credit commitments under the Credit Agreement to the fifth anniversary of the effective date of the Amendment (subject to a springing maturity date moving the maturity date of such revolving credit commitments to 91 days prior to the maturity date of the Unsecured Notes to the extent any amount of the Unsecured Notes remains unpaid as of such date). Post-Amendment, the principal amount of the First Lien Term Loan indebtedness under the Credit Agreement is approximately $678,000,000.
The foregoing description of the Amendment is not complete and is qualified in its entirety by reference to the full text of the Amendment, which is attached to this Current Report on Form 8-K as Exhibit 10.1, and is incorporated herein by reference. Capitalized terms used in this Item 1.01 but not defined herein have the meaning assigned to such terms in the Amendment or the Credit Agreement, as applicable.
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 above is incorporated into this Item 2.03 by reference.
Item 9.01. Financial Statements and Exhibits
(d) Exhibits.
| Exhibit Number |
Exhibit Description | |
| 10.1 | Fourth Amendment to Amended and Restated First Lien Credit Agreement, dated as of September 22, 2025, by and among Option Care Health, Inc., a Delaware corporation, as borrower, each other Loan Party (as defined therein) party thereto, each 2025 Refinancing Term Lender (as defined therein) party thereto, each 2025 Incremental Term Lender (as defined therein), each Extending Revolving Credit Lender (as defined therein) and Bank of America, N.A., as administrative agent. | |
| 104 | Cover Page Interactive Data File (embedded within the inline XBRL document) |
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.
| Option Care Health, Inc. | |||
| Date: | September 25, 2025 | By: | /s/ Michael Shapiro |
| Michael Shapiro | |||
| Chief Financial Officer |
FAQ
What did Option Care Health (OPCH) change in its credit agreement?
How large is Option Care Health's first lien term loan balance after the amendment?
What is the interest rate on the new and incremental term loans?
Did the amendment change the revolver maturity for OPCH?
Who is the administrative agent for the amended credit agreement?
