{"url_path":"/sec/ach/8-k/2026-06-15/item-1-01","section_key":"item-1-01","section_title":"Item 1.01 Entry Into a Material Definitive Agreement","topic":"sec","document":{"doc_type":"8-K","doc_date":"2026-06-15","source_url":"https://www.sec.gov/Archives/edgar/data/75252/0001193125-26-271115-index.html","accession_number":"0001193125-26-271115","cik":"0000075252","ticker":"ACH","issuer_name":"ACCENDRA HEALTH INC/VA/","edgar_url":"https://www.sec.gov/Archives/edgar/data/75252/0001193125-26-271115-index.html","primary_entity_key":"0000075252","primary_entity_name":"ACCENDRA HEALTH INC/VA/"},"word_count":2886,"has_tables":true,"body_markdown":"Item 1.01.\n\nEntry Into a Material Definitive Agreement\n\nThe information set forth in the Explanatory Note of this Current Report on Form 8-K (this “Current Report”) is incorporated into this Item 1.01 by reference.\n\n \n\nNew Notes Indentures and New Notes\n\nOverview\n\nThe First Lien Notes issued as part of the new money issuance and delivered in exchange for the 2029 Notes tendered prior to the Early Exchange Time were issued pursuant to the Indenture, dated June 15, 2026 (the “First Lien Indenture”), by and among the Company, the guarantors named therein and Regions Bank, as trustee (in such capacity, the “First Lien Trustee”) and as collateral agent (in such capacity, the “First Lien Collateral Agent”) and the Second Lien Notes delivered in exchange for the Early Tendered Notes were, and any Second Lien Notes delivered in exchange for any remaining Existing Notes that are validly tendered in the Exchange Offers following the Early Exchange Time and at or prior to the Expiration Time will be, issued pursuant to the Indenture, dated June 15, 2026 (the “Second Lien Indenture” and, together with the First Lien Indenture, the “New Indentures”), by and among the Company, the guarantors named therein and Regions Bank, as trustee (in such capacity, the “Second Lien Trustee” and, together with the First Lien Trustee, the “Trustees”) and as collateral agent (in such capacity, the “Second Lien Collateral Agent” and, together with the First Lien Collateral Agent, the “Collateral Agents”).\n\nInterest; Ranking; Security; Guarantees\n\nThe First Lien Notes bear interest at a rate of 9.000% per year, payable semi-annually in cash in arrears on June 15 and December 15 of each year, commencing December 15, 2026. The Second Lien Notes bear interest at a rate of 9.750% per year, payable semi-annually in cash in arrears on June 15 and December 15 of each year, commencing December 15, 2026.\n\nThe New Notes are our general senior obligations, and the First Lien Notes are secured by a first-priority lien on the collateral securing the First Lien Notes, while the Second Lien Notes are secured by a second-priority lien on the collateral securing the Second Lien Notes, in each case, subject to permitted liens and certain exceptions on substantially all of our and the guarantors’ existing and future assets other than excluded property that secure the Company’s credit facilities.\n\nThe First Lien Notes are pari passu in right of payment with any of our existing and future senior indebtedness, including indebtedness under the Company’s credit facilities, the Second Lien Notes and the Existing Notes. The First Lien Notes are pari passu as to the collateral owned by us with our indebtedness under the credit facilities and all of our future indebtedness secured by a first-priority lien on the collateral securing the First Lien Notes, effectively senior to all of our existing and future unsecured indebtedness (including the Existing Notes) and junior lien obligations (including the Second Lien Notes), to the extent of the value of the collateral securing the First Lien Notes, effectively subordinated to any of our existing or future indebtedness that is secured by liens on assets that do not constitute a part of the collateral to the extent of the value of such assets, senior in right of payment to any of our future subordinated indebtedness and structurally subordinated to any existing and future indebtedness and other liabilities of our subsidiaries that are not guarantors.\n\nThe Second Lien Notes are pari passu in right of payment with any of our existing and future senior indebtedness, including indebtedness under the Company’s credit facilities, the First Lien Notes and the Existing Notes. The Second Lien Notes are junior as to the collateral owned by us with our indebtedness under the credit facilities and pari passu as to all of our future indebtedness secured by a second-priority lien on the collateral securing the Second Lien Notes, effectively senior to all of our existing and future unsecured indebtedness (including the Existing Notes) and junior lien obligations, to the extent of the value of the collateral securing the Second Lien Notes, effectively subordinated to any of our existing or future indebtedness that is secured by liens on assets that do not constitute a part of the collateral to the extent of the value of such assets, senior in right of payment to any of our future subordinated indebtedness and structurally subordinated to any existing and future indebtedness and other liabilities of our subsidiaries that are not guarantors.\n\nSubject to certain exceptions, the Company’s existing and future wholly-owned domestic subsidiaries (including each subsidiary guarantor of the Existing Notes) guarantee our obligations under the First Lien Notes and Second Lien Notes on a senior secured basis.\n\n \n\nOptional Redemption\n\nThe Company may, at its option, redeem at any time and from time to time, all or part of the First Lien Notes, prior to June 15, 2029, at a price equal to 100% of the principal amount of the First Lien Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, plus a “make-whole” premium, as described in the First Lien Indenture. On and after June 15, 2029, the Company may redeem all or part of the First Lien Notes at the applicable redemption prices described in the First Lien Indenture, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.\n\nThe Company may also redeem up to 40% of the aggregate principal amount of First Lien Notes at any time prior to June 15, 2029, at a redemption price equal to 109.000% with an amount equal to or less than the net cash proceeds from certain equity offerings, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. At any time prior to June 15, 2029, the Company may also redeem the First Lien Notes upon the consummation of a Change of Control (as defined in the First Lien Indenture), at a redemption price equal to 103% of the aggregate principal amount thereof, plus accrued and unpaid interest thereon to, but excluding, the redemption date.\n\nThe Company may, at its option, redeem at any time and from time to time, all or part of the Second Lien Notes, prior to June 15, 2029, at a price equal to 100% of the principal amount of the Second Lien Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date, plus a “make-whole” premium, as described in the Second Lien Indenture. On and after June 15, 2029, the Company may redeem all or part of the Second Lien Notes at the applicable redemption prices described in the Second Lien Indenture, plus accrued and unpaid interest, if any, to, but excluding, the redemption date.\n\nThe Company may also redeem up to 40% of the aggregate principal amount of Second Lien Notes at any time prior to June 15, 2029, at a redemption price equal to 109.750% with an amount equal to or less than the net cash proceeds from certain equity offerings, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. At any time prior to June 15, 2029, the Company may also redeem the Second Lien Notes upon the consummation of a Change of Control (as defined in the Second Lien Indenture), at a redemption price equal to 103% of the aggregate principal amount thereof, plus accrued and unpaid interest thereon to, but excluding, the redemption date.\n\nChange of Control\n\nSubject to certain limitations, in the event of a Change of Control (as defined in the First Lien Indenture), the Company will be required to offer to repurchase the New Notes from holders at 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.\n\nSubject to certain limitations, in the event of a Change of Control (as defined in the Second Lien Indenture), the Company will be required to offer to repurchase the New Notes from holders at 101% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but excluding, the repurchase date.\n\nCovenants; Events of Default\n\nThe New Indentures contain certain covenants, including, among other things, covenants that restrict the ability of the Company and its restricted subsidiaries to incur or guarantee additional indebtedness or issue disqualified stock or certain preferred stock, pay dividends and make other distributions or repurchase stock, make certain investments, make certain payments of junior indebtedness, create or incur liens, sell certain assets, enter into restrictions affecting the ability of restricted subsidiaries to make distributions, loans or advances or transfer assets to the Company or the guarantors, enter into certain transactions with the Company’s affiliates, designate restricted subsidiaries as unrestricted subsidiaries, merge, consolidate or transfer or sell all or substantially all of the Company’s or the guarantors’ assets and consummate a liability management transaction. These covenants are subject to a number of important limitations and exceptions. Most of these covenants will not apply to the Company and its restricted subsidiaries during any period in which the New Notes are rated investment grade by any two of Moody’s Investors Service, Inc., S&P Global Ratings and Fitch Inc.\n\n \n\nThe New Indentures also contain customary provisions for events of default including, but not limited to, for failure to pay principal or interest when due and payable, failure to comply with covenants or agreements in the New Indentures or the New Notes and failure to cure or obtain a waiver of such default upon notice, failure of any liens created by the New Notes collateral documents on any material portion of the collateral intended to be covered to be valid and perfected, and events of bankruptcy, insolvency or reorganization affecting the Company and certain of its subsidiaries. In the case of an event of default, the principal amount of the New Notes plus accrued and unpaid interest, if any, may be accelerated.\n\nThe foregoing description of the New Notes and the New Indentures in this Current Report are summaries and are qualified in their entirety by reference to the full text of the New Indentures and the form of New Notes included therein. The New Indentures are filed hereto as Exhibits 4.1 and 4.3 and the form of global notes representing the New Notes are filed hereto as Exhibits 4.2 and 4.4, and are incorporated by reference herein.\n\nSupplemental Indentures for Existing Notes\n\nFollowing receipt of the requisite consents in the Consent Solicitations to adopt the Amendments to the Existing Note Indentures, the Company entered into the Existing Notes Supplemental Indentures on June 9, 2026, which became operative in connection with the acceptance and cancellation of the Early Tendered Notes on June 15, 2026.\n\nThe foregoing description of the Existing Notes Supplemental Indentures in this Current Report are summaries and are qualified in their entirety by reference to the full text of the Existing Notes Supplemental Indentures, which are filed as Exhibits 4.5 and 4.6 to this Current Report and are incorporated by reference.\n\nFourth Amendment to Credit Agreement and Consent\n\nOn June 15, 2026, the Company, as parent borrower (the “Parent Borrower”), Barista Acquisition I, LLC, Barista Acquisition II, LLC, Byram Healthcare Centers, Inc. and Apria, Inc. (together with the Parent Borrower, the “Borrowers”) and the guarantors party thereto (together with the Borrowers, the “Loan Parties”), entered into that certain Amendment No. 4 to Credit Agreement and Consent (the “Fourth Amendment”) with each lender party thereto and Bank of America, N.A., as administrative agent, collateral agent, letter of credit issuer and swingline lender, thereby amending that certain Credit Agreement, initially dated March 10, 2021 (as amended, restated, amended and restated, modified, extended, replaced or supplemented prior to the date hereof, and as further amended by the Fourth Amendment, the “Revolving Credit Agreement”), by and among, inter alios, the Company and Bank of America, N.A.\n\nPursuant to the Fourth Amendment, a new $300.0 million revolving credit facility (with the last $50 million available only in connection with mergers and acquisitions, and subject to compliance with certain leverage ratios) (the “New Revolving Credit Facility”) due in 2030, subject to a springing maturity of 91 days inside intervening maturities of certain indebtedness in excess of $25.0 million in aggregate principal amount, was established and the existing revolving credit facility thereunder was cancelled.\n\nThe interest rate on the New Revolving Credit Facility will be based on either the applicable SOFR rate or the base rate plus an applicable rate which vary depending on the Total Leverage Covenant Ratio (as defined in the Revolving Credit Agreement). The commitment fee on the unutilized revolving credit commitments under the New Revolving Credit Facility will vary depending on the Total Leverage Covenant Ratio and the current Debt Ratings (each as defined in the Revolving Credit Agreement). The Revolving Credit Agreement contains certain conditions to utilization and we shall not be permitted to utilize the New Revolving Credit Facility above an amount that would result in us having more than $50 million of unrestricted cash on our consolidated balance sheet (after giving effect to certain anticipated payments) immediately after giving effect to such borrowing.\n\nThe Revolving Credit Agreement is secured by first-priority liens and security interests in (a) all present and future shares of capital stock owned by the loan parties in the Loan Parties’ present and future subsidiaries and (b) all present and future personal property and assets of the Loan Parties, subject to certain exceptions. The security interests are subject to the Pari Passu First Lien Intercreditor Agreement and the Junior Lien Intercreditor Agreement (each as defined in the Revolving Credit Agreement).\n\n \n\nThe Revolving Credit Agreement requires us to maintain a Total Leverage Covenant Ratio (as defined in the Revolving Credit Agreement) of less than 5.50:1.00 in respect of test periods ending prior to January 1, 2028 and less than 4.50:1:00 (or 5.00:1.00 for the first four fiscal quarters following the date of certain qualifying acquisitions) in respect of test periods ending thereafter. The Revolving Credit Agreement requires us to maintain a consolidated interest coverage ratio of greater than or equal to 2.00:1.00, including on a pro forma basis in the event of an acquisition or divestiture.\n\nThe Revolving Credit Agreement contains covenants that, among other things, limit our ability and the ability of our restricted subsidiaries to incur or guarantee additional indebtedness or issue disqualified stock, pay dividends and make other distributions or repurchase stock, make certain investments, make certain payments of junior indebtedness, create or incur liens, sell assets, enter into restrictions affecting the ability of restricted subsidiaries to make distributions, loans or advances or transfer assets to the issuer or the guarantors, enter into certain transactions with the issuer’s affiliates, designate restricted subsidiaries as unrestricted subsidiaries, and merge, consolidate or transfer or sell all or substantially all of the Company’s or a restricted subsidiary’s assets.\n\nThe Revolving Credit Agreement also contains affirmative covenants customary for credit facilities of this nature, including as to compliance with laws, maintenance of required insurance, payment of taxes, delivery of quarterly and annual financial statements, and maintenance and operation of property. In addition, the Revolving Credit Agreement contains customary events of default, including as to non-payment, cross-defaults, failure to comply with financial covenants and other covenants, bankruptcy and insolvency events, judgments, invalidity of collateral or guarantees, changes of control and ERISA-related events.\n\nEach of these affirmative and negative covenants and events of default is subject to certain important limitations and exceptions.\n\nThe foregoing description of the Fourth Amendment is a summary and is qualified in its entirety by reference to the full text of the Fourth Amendment, which is filed as Exhibit 10.1 to this Current Report and incorporated by reference herein.\n\nSecond Amendment to Term Loan Credit Agreement and Consent\n\nOn June 15, 2026, the Parent Borrower and Loan Parties, entered into that certain Amendment No. 2 to the Term Loan Credit Agreement and Consent (“Second Amendment”) with each consenting Term A-1 Term Lender party thereto, each consenting Term B-1 Term Lender party thereto and JPMorgan Chase Bank, N.A. as administrative agent and collateral agent, thereby amending that certain Term Loan Credit Agreement, initially dated March 29, 2022 (as amended, restated, amended and restated, modified, extended, replaced or supplemented prior to the date hereof, and as further amended by the Fourth Amendment, the “Term Loan Credit Agreement”) by and among, inter alios, the Company and JPMorgan Chase Bank, N.A..\n\nPursuant to the Second Amendment, the applicable consenting lenders consented to: (i) a waiver of the mandatory prepayment provisions set forth in the Term Loan Credit Agreement in relation to certain asset sales with an aggregate amount of net cash proceeds equal to $400.0 million, (ii) the transactions contemplated by the Offers and Consent Solicitations, including the issuance of the New Notes and the granting of the liens in connection therewith, (iii) making certain modifications to the affirmative and negative covenants set forth in the Term Loan Credit Agreement (including with respect to covenants, “baskets,” exceptions, thresholds and qualifiers), and (iv) certain amendments to the intercreditor arrangements applicable to the Term Loan Credit Agreement.\n\nThe foregoing description of the Second Amendment is a summary and is qualified in its entirety by reference to the full text of the Second Amendment, which is filed as Exhibit 10.2 to this Current Report and incorporated by reference herein."}