Item 1.01 Entry into a Material Definitive Agreement.
The information set forth in Item 2.03 of this report is incorporated herein by
reference.
Item 2.03 Creation of a Direct Financial Obligation or an Obligation Under an
Off-Balance Sheet Arrangement of the Registrant.
Credit Agreement
On August 16, 2021, AdaptHealth LLC ("AdaptHealth"), a Delaware limited
liability company and wholly owned indirect subsidiary of AdaptHealth Corp.,
entered into that certain Second Amendment (the "Credit Agreement Amendment") to
the Credit Agreement, dated as of January 20, 2021 (as amended, restated,
increased, extended, supplemented or otherwise modified from time to time, the
"Credit Agreement"), by and among AdaptHealth, the guarantors named therein,
Regions Bank as administrative agent and collateral agent and the lenders party
thereto. The Credit Agreement Amendment expressly permitted the issuance of the
Notes (as defined below) and the prepayment of the outstanding principal amount
under the promissory notes held by affiliates of Assured Investment Management
LLC (f/k/a BlueMountain Capital Management, LLC) (the "Preferred Notes") with
the proceeds of the Notes. In addition, it increased the amount of unencumbered
cash that may be used to reduce total indebtedness in the calculation of certain
financial covenants for the fiscal quarters ending September 30, 2021 and
December 31, 2021.
The foregoing description of the Credit Agreement Amendment does not purport to
be complete and is qualified in its entirety by the full text thereof, which is
filed as Exhibit 10.1 hereto and incorporated herein by reference.
Notes Offering
On August 19, 2021, AdaptHealth completed its previously announced offering of
$600,000,000 aggregate principal amount of its 5.125% Senior Notes due 2030 (the
"Notes"). The Notes were issued under an indenture (the "Indenture"), dated
August 19, 2021, among AdaptHealth, the guarantors party thereto and The Bank of
New York Mellon Trust Company, N.A., as trustee.
The gross proceeds from the issuance of the Notes were used to repay the
Preferred Notes, to repay amounts outstanding under AdaptHealth's revolving
credit facility, to pay related fees and expenses, and the remainder will be
used for general corporate purposes.
The Notes are unsecured senior obligations of AdaptHealth and rank equally in
right of payment to all of its existing and future senior debt, including its
existing $350,000,000 aggregate principal amount of 6.125% senior notes due 2028
and $500,000,000 aggregate principal amount of 4.625% senior notes due 2029, and
senior in right of payment to all of its future subordinated debt. The Notes are
effectively subordinated to any of AdaptHealth's existing and future secured
debt, including under the Credit Agreement, to the extent of the value of the
assets securing such debt.
The Notes are guaranteed by each of AdaptHealth's existing and future
subsidiaries that is a borrower or that guarantees its obligations under the
Credit Agreement or certain other indebtedness, and by AdaptHealth's direct
parent, AdaptHealth Intermediate Holdco LLC, which also guarantees its
obligations under the Credit Agreement. The Notes will mature on March 1, 2030.
Interest on the Notes will be payable on March 1 and September 1 of each year,
beginning on March 1, 2022.
The Notes will be redeemable, in whole or in part, at any time on or after March
1, 2025, and the redemption price for the Notes if redeemed during the 12 months
beginning (i) March 1, 2025 is 102.563%, (ii) March 1, 2026 is 101.281% and
(iii) March 1, 2027 and thereafter is 100.000%, in each case together with
accrued and unpaid interest, if any, to, but excluding, the redemption date.
AdaptHealth may also redeem some or all of the Notes before March 1, 2025 at a
redemption price of 100% of the principal amount, plus a "make-whole" premium,
plus accrued and unpaid interest, if any, to, but not including, the redemption
date. In addition, AdaptHealth may redeem up to 40% of the aggregate principal
amount of the Notes before March 1, 2025 with the net cash proceeds from certain
equity offerings at a price equal to 105.125% of the principal amount of the
Notes, plus accrued but unpaid interest, if any, to, but not including, the
redemption date. Furthermore, AdaptHealth may be required to make an offer to
purchase the Notes upon the sale of certain assets or upon specific kinds of
changes of control.
The offering of the Notes was not registered under the Securities Act of 1933,
as amended (the "Securities Act"), or any state securities laws, and the Notes
may not be offered or sold in the United States absent registration or an
applicable exemption from the registration requirements of the Securities Act
and applicable state securities laws. The Notes were sold to persons reasonably
believed to be "qualified institutional buyers," as defined in Rule 144A under
the Securities Act, and non-U.S. persons outside the United States under
Regulation S under the Securities Act.
- 2 -
The foregoing description of the Indenture does not purport to be complete and
is subject to, and qualified in its entirety by, the full text of the Indenture.
A copy of the Indenture is attached as Exhibit 4.1 hereto and is incorporated by
reference herein.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
4.1 Indenture, dated as of August 19, 2021, by and among AdaptHealth LLC,
the guarantors party thereto and The Bank of New York Mellon Trust
Company, N.A., as trustee.
10.1 Second Amendment dated as of August 16, 2021, to the Credit Agreement,
dated as of January 20, 2021, among AdaptHealth LLC, the guarantors named
therein, Regions Bank as administrative agent and collateral agent and the
lenders party thereto.
104 The cover page from this Current Report on Form 8-K, formatted in Inline
XBRL.
- 3 -
© Edgar Online, source Glimpses