Acadia Healthcare expands facility, extends maturity, reduces pricing

By Marisa Wong

Madison, Wis., Feb. 19 - Acadia Healthcare Co., Inc. entered into a fourth amendment to its amended and restated senior credit facility dated Dec. 31, 2012 to increase the size of the facility and extend the maturity date, according to an 8-K filing with the Securities and Exchange Commission.

The fourth amendment, completed on Feb. 13, provides the company with an up to $300 million revolving line of credit and $300 million of term loans.

The term loans require quarterly principal payments of $1.9 million for March 31 to Dec. 31, 2014, $3.8 million for March 31, 2015 to Dec. 31, 2015, $5.6 million for March 31, 2016 to Dec. 31, 2016, $7.5 million for March 31, 2017 to Dec. 31, 2017 and $9.4 million for March 31, 2018 to Dec. 31, 2018, with the remaining principal balance due on the maturity date of Feb. 13, 2019.

The amendment also provides for a $150 million incremental credit facility, with the potential for unlimited additional incremental amounts, provided that the company meets specific financial ratios.

In addition, the amendment reduces the facility's interest rates and provides the company with increased flexibility in terms of its financial and other restrictive covenants.

Borrowings bear interest at a rate tied to the company's consolidated leverage ratio. The applicable margin for Libor loans ranges from 225 bps to 300 bps.

The company is also required to pay a commitment fee on undrawn amounts. The unused line fee ranges from 30 bps to 45 bps.

The amendment resulted in a 50 bps decrease in the applicable rate and a 10 bps decrease in the unused line fee.

The financial covenants under the amended facility include maintaining:

• A fixed-charge coverage ratio of not less than 1.25 to 1 as of the end of any fiscal quarter;

• A consolidated leverage ratio of not greater than 5.5 to 1 for each of the quarters ending March 31 to Dec. 31, 2014, 5.25 to 1 for each of the quarters ending March 31, 2015 to Dec. 31, 2015, 5 to 1 for each of the quarters ending March 31, 2016 to Dec. 31, 2016 and 4.5 to 1 for the quarter ending March 31, 2017 and each quarter after that; and

• A consolidated senior secured leverage ratio of not greater than 3.5 to 1 for each of the quarters ending March 31 to Dec. 31, 2014, 3.25 to 1 for each of the quarters ending March 31, 2015 to Dec. 31, 2015 and 3 to 1 for the quarter ending March 31, 2016 and each quarter after that.

Acadia is a Franklin, Tenn.-based provider of inpatient behavioral health care services.

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