01—Abstract
Summary
Summary of the 8-K filed June 27, 2025. Cited figures are marked; the original filing is the authoritative source.
Labcorp Holdings Inc. (LH) disclosed on June 27, 2025 that it, as parent guarantor, and Laboratory Corporation of America Holdings (LCAH), as borrower, entered into a Fourth Amended and Restated Credit Agreement with Bank of America, N.A., as administrative agent, and the other lenders party thereto.
The agreement provides a $1,000,000,000a senior unsecured revolving credit facility, including a $100,000,000 swingline subfacility and a $150,000,000 sublimit for letters of credit, scheduled to mature on June 27, 2030. It amends and restates the Third Amended and Restated Credit Agreement dated April 30, 2021, which provided a $1,000,000,000 facility scheduled to mature on April 30, 2026. As of the closing date, there were no outstanding borrowings under the Credit Facility.
The Credit Facility carries floating-rate pricing tied to LCAH's long-term debt ratings: SOFR-based borrowings at a margin of 0.805% to 1.300%, or base-rate borrowings at a margin of 0% to 0.300%. A facility fee of 0.070% to 0.200% is payable quarterly on total commitments regardless of usage. The agreement allows an increase of up to $500,000,000,b subject to conditions including obtaining additional lender commitments.
The agreement includes customary representations, affirmative and negative covenants, and events of default, and requires a consolidated leverage ratio of not more than 4.0 to 1.0 as of each quarter-end. The ratio may rise to 4.5 to 1.0 for four fiscal quarters following a material acquisition (a "Leverage Holiday"), which may be elected an unlimited number of times, subject to a requirement that the ratio return to 4.0 to 1.0 for at least two fiscal quarters before another election.
Upon an event of default, outstanding loans may be accelerated. The Company also disclosed that some lenders and their affiliates provide commercial banking, investment banking and advisory services to the Company in the ordinary course for customary fees.
02—Key points
Key Highlights
- Entered into a Fourth Amended and Restated Credit Agreement dated June 27, 2025, providing a $1,000,000,000 senior unsecured revolving credit facility maturing June 27, 2030.
- Facility replaces the Third Amended and Restated Credit Agreement dated April 30, 2021, whose $1,000,000,000 facility was scheduled to mature April 30, 2026, extending the maturity by the new term.
- No outstanding borrowings under the Credit Facility as of the closing date.
- Includes a $100,000,000 swingline subfacility, a $150,000,000 letter of credit sublimit, and an option to increase the facility by up to $500,000,000 subject to conditions.
- Pricing is tied to LCAH's long-term debt ratings: SOFR margin of 0.805% to 1.300% or base rate margin of 0% to 0.300%, plus a facility fee of 0.070% to 0.200% on total commitments.
- Financial covenant requires a consolidated leverage ratio of not more than 4.0 to 1.0, with a permitted increase to 4.5 to 1.0 for four fiscal quarters after a material acquisition, usable an unlimited number of times subject to conditions.
- Item 2.03 disclosure incorporates the credit agreement terms by reference as a direct financial obligation of the registrant.
03—Questions
Frequently Asked Questions
What is the size and maturity of the new credit facility?
The Credit Agreement provides a $1,000,000,000 senior unsecured revolving credit facility scheduled to mature on June 27, 2030.
Was the company drawing on the facility at closing?
No. As of the Closing Date, there were no outstanding borrowings under the Credit Facility.
How is borrowing priced?
Borrowings bear interest at either a SOFR-based rate plus a margin of 0.805% to 1.300%, or a base rate plus a margin of 0% to 0.300%, depending on LCAH's long-term debt ratings. A facility fee of 0.070% to 0.200% is payable quarterly on the aggregate commitments regardless of usage.
What financial covenant applies to the facility?
The Company must maintain a consolidated leverage ratio of not more than 4.0 to 1.0 as of the last day of each quarter. This may be raised to 4.5 to 1.0 for four fiscal quarters following a material acquisition, but the ratio must return to 4.0 to 1.0 for at least two fiscal quarters before another such election.
What does the agreement replace?
It amends and restates in its entirety the Third Amended and Restated Credit Agreement dated April 30, 2021, which provided a $1,000,000,000 senior unsecured revolving facility scheduled to mature April 30, 2026.
04—Continue