Oscar Health, Inc.OSCR
Oscar Health, Inc. Debt Disclosure
DEBT
2031 Convertible Senior Notes
In February 2022, the Company issued $305.0 million in aggregate principal amount of convertible senior notes due 2031 (the “2031 Notes”) in a private placement to funds affiliated with or advised by Dragoneer Investment Group, LLC, Thrive Capital, LionTree Investment Management, LLC and Tenere Capital LLC (the “Initial Purchasers”). In connection with the issuance of the 2031 Notes, on January 27, 2022, the Company entered into an investment agreement with the Initial Purchasers (the “Investment Agreement”) and on February 3, 2022, the Company entered into an indenture with U.S. Bank, as Trustee (the “2031 Indenture”). On September 11, 2025, the Company entered into an amendment to the Investment Agreement to permit the private offering of the 2030 Notes (as defined below) under the Investment Agreement (the “Amendment”). The Amendment provided, in relevant part, that the issuance of the 2030 Notes would be permitted provided that the 2030 Notes were and remained expressly subordinated in right of payment to the 2031 Notes for as long as Oasis FD Holdings, LP (“Dragoneer”) held at least $75.0 million in aggregate principal amount of the 2030 Notes. As discussed further below, in connection with the Exchange Agreement and the related transactions, as of November 5, 2025, the debt covenants in the Investment Agreement, as amended, were extinguished, and the 2030 Notes ceased to be subordinated to the 2031 Notes.
The 2031 Notes are the Company's senior, unsecured obligations which bear interest at a rate of 7.25% per annum, payable in cash, semi-annually in arrears on June 30 and December 31 of each year, commencing on June 30, 2022. The 2031 Notes will mature on December 31, 2031, subject to earlier repurchase, redemption, or conversion.
Upon the occurrence of a fundamental change (as defined in the 2031 Indenture), holders of the 2031 Notes have the right to require the Company to repurchase all or some of their 2031 Notes for cash, subject to certain conditions. The repurchase price will be equal to the principal amount of the notes to be repurchased, plus accrued and unpaid interest, if any, to, but excluding, the applicable repurchase date. Additionally, the Initial Purchasers of the 2031 Notes have the right to require the Company to repurchase all of their 2031 Notes for cash, on each of June 30, 2027, June 30, 2028, June 30, 2029 and June 30, 2030, subject to certain notice requirements.
The Company may not redeem the 2031 Notes before December 31, 2026. The Company may redeem all of the 2031 Notes, from December 31, 2026 to the 35th scheduled trading day before the maturity date, at the redemption price. To do so, the last reported sale price per share of Class A common stock must have exceeded 200% of the conversion price for 20 of the last 30 consecutive trading days immediately before the date on which the Company sends the applicable redemption notice. The redemption price will be a cash amount equal to the principal amount of the 2031 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. If the Company calls any of the 2031 Notes for redemption, the Initial Purchasers may elect to convert their 2031 Notes and receive shares of Class A common stock pursuant to the terms of the Investment Agreement.
The 2031 Notes are initially convertible into the Company's Class A common stock at a price of approximately $8.32 per share of Class A common stock (based on an initial conversion rate of 120.1721 per $1,000 principal amount), subject to customary adjustments upon the occurrence of certain events. The holders may elect to convert their 2031 Notes: (i) on or after August 31, 2031, (ii) if the Company calls the 2031 Notes for redemption, (iii) upon satisfaction of a Class A common stock sale price condition, (iv) upon satisfaction of a 2031 Note trading price condition, or (v) upon certain corporate events. Upon conversion, the Company may choose to settle the 2031 Notes in shares of Class A common stock, cash, or a combination of both, unless an Initial Purchaser of the 2031 Notes elects to receive shares of Class A common stock pursuant to the terms of the Investment Agreement. During the quarterly period ended December 31, 2025, the Class A common stock sales price condition was satisfied because the last reported sales price per share of the Company’s common stock exceeded 130% of the conversion price of $8.32 per share for twenty (20) trading days of the thirty (30) consecutive trading days ending on the last trading day of the quarter. As a result, the holders may elect to convert their 2031 Notes during the first quarter of 2026.
The 2031 Notes include customary provisions relating to the occurrence of “Events of Default” (as defined in the Indenture), as well as customary covenants for convertible notes of this type, including restrictions on the Company's ability to refinance the Company's indebtedness and incur additional indebtedness.
In October 2025, the Company received conversion notices from certain of the Initial Purchasers to convert a total of $20.0 million in aggregate principal amount of the 2031 Notes. The Company elected to issue approximately 2.4 million shares of Class A common stock to settle these conversions. As a result of this partial conversion associated with certain Initial Purchasers, the net carrying amount of 2031 Notes, including unamortized debt discount and issuance costs of $0.9 million, were transferred to additional paid-in capital, and no gain or loss was recognized on the transaction.
On November 3, 2025, the Company and Dragoneer entered into an Exchange Agreement (the “Exchange Agreement”) pursuant to which, until December 14, 2025, Dragoneer could elect to exchange up to $250.0 million aggregate principal amount of the 2031 Notes, representing the balance of its 2031 Notes, for aggregate consideration consisting of (A) a number of shares of Class A common stock based on the conversion rate set forth in the 2031 Indenture, and (B) up to $17.8 million, payable in shares of Class A common stock and/or cash, pursuant to the terms of the Exchange Agreement and subject to the satisfaction of certain conditions. In November 2025, Dragoneer exchanged a total of $250.0 million aggregate principal amount of their 2031 Notes in exchange for approximately 30.1 million shares of the Company’s Class A common stock. As a result of this conversion, the net carrying amount of 2031 Notes, including unamortized debt discount and issuance costs of $12.9 million, were transferred to additional paid-in capital. Additionally, with the exchange, Dragoneer also received an inducement payment totaling $17.8 million, of which $4.4 million was paid in cash and the remaining $13.3 million was settled through the issuance of approximately 0.7 million additional shares of Class A common stock. The Company recognized the inducement payment as Other expense in its Consolidated Statements of Operations.
In connection with the Exchange Agreement and the related transactions, as of November 5, 2025, the debt covenants in the Investment Agreement, as amended, were extinguished, and the 2030 Notes (as defined below) ceased to be subordinated to the 2031 Notes.
2030 Convertible Senior Notes
On September 18, 2025, the Company issued $410.0 million aggregate principal amount of convertible senior notes due 2030 (the “2030 Notes”). The 2030 Notes were issued pursuant to an indenture (the “2030 Indenture”), dated as of September 18, 2025, between the Company and U.S. Bank Trust Company, National Association, as trustee.
The 2030 Notes are the Company’s unsecured indebtedness which bear interest at a rate of 2.25% per annum, payable semi-annually in arrears on March 1 and September 1 of each year, beginning on March 1, 2026. The 2030 Notes will mature on September 1, 2030, unless they are earlier repurchased, redeemed, or converted.
As discussed above under “–2031 Convertible Senior Notes”, the 2031 Notes were originally subordinated to the 2030 Notes. In connection with the Exchange Agreement and the related transactions, as of November 5, 2025, the 2030 Notes ceased to be subordinated to the 2031 Notes.
Upon the occurrence of a fundamental change (as defined in the 2030 Indenture), holders of the 2030 Notes may require the Company to repurchase their 2030 Notes for cash, subject to certain conditions. The repurchase price will be equal to the
principal amount of the 2030 Notes to be repurchased, plus accrued and unpaid interest to, but excluding, the repurchase date.
The Company may redeem the 2030 Notes, in whole or in part (subject to certain limitations described below), from September 6, 2028 to the 25th scheduled trading day before the maturity date. To do so, (i) the 2030 Notes must be freely tradable (as defined in the 2030 Indenture) as of the date of the redemption notice, the Company must be current in its interest payment obligations to the 2030 Notes holders; and (ii) the last reported sale price per share of the Company’s Class A common stock must have exceeded 130% of the conversion price on (1) 20 of the last 30 consecutive trading days immediately before the date the Company sends the applicable redemption notice; and (2) the trading day immediately before the date the Company sends such redemption notice. The Company may only redeem less than all of the outstanding 2030 Notes if at least $100.0 million aggregate principal amount of 2030 Notes are outstanding (and not called for redemption) when the Company sends the redemption notice. The redemption price will be a cash amount equal to the principal amount of the 2030 Notes to be redeemed, plus accrued and unpaid interest, if any, to, but excluding, the redemption date. Calling any 2030 Note for redemption will constitute a make-whole fundamental change (as defined in the 2030 Indenture) with respect to that 2030 Note, so the conversion rate for that 2030 Note will be increased in certain circumstances if it is converted after it is called for redemption.
Before June 1, 2030, noteholders may only convert their 2030 Notes upon the occurrence of certain events. From June 1, 2030 until the second scheduled trading day before the maturity date, noteholders may elect to convert their 2030 Notes at any time. The Company may choose to settle conversions in cash, shares of its Class A common stock, or a combination of both. The initial conversion price is approximately $24.82 per share of the Company’s Class A common stock (based on an initial conversion rate of 40.2946 shares of the Company’s Class A common stock per $1,000 principal amount of 2030 Notes). The conversion rate and conversion price are subject to customary adjustments upon the occurrence of certain events. In addition, if certain make-whole fundamental changes occur, the conversion rate will, in certain circumstances, be increased for a specified period of time.
The following is a summary of net carrying amounts and the estimated fair values of the Company’s convertible notes:
| 2030 Notes | 2031 Notes | |||||||||||||||||||
| (in thousands) | December 31, 2025 | December 31, 2025 | December 31, 2024 | |||||||||||||||||
| Principal amount | $ | 410,000 | $ | 35,000 | $ | 305,000 | ||||||||||||||
| Unamortized debt discount and issuance costs | $ | 13,356 | $ | 1,549 | $ | 5,445 | ||||||||||||||
| Net carrying amount | $ | 396,644 | $ | 33,451 | $ | 299,555 | ||||||||||||||
| Fair value amount | $ | 401,431 | $ | 63,997 | $ | 539,843 | ||||||||||||||
| Leveling | Level 2 | Level 3 | Level 3 | |||||||||||||||||
The following table presents the interest expense over the term of the Company’s convertible notes:
| Year Ended December 31, | |||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | ||||||||||||||
| 2031 Notes | |||||||||||||||||
| Coupon interest expense | $ | 12,325 | $ | 21,928 | $ | 22,112 | |||||||||||
| Amortization of debt discount and issuance costs | 811 | 778 | 778 | ||||||||||||||
| Interest expense for 2031 Notes | $ | 13,136 | $ | 22,706 | $ | 22,890 | |||||||||||
| 2030 Notes | |||||||||||||||||
| Coupon interest expense | $ | 2,639 | |||||||||||||||
| Amortization of debt discount and issuance costs | 819 | ||||||||||||||||
| Interest expense for 2030 Notes | $ | 3,458 | |||||||||||||||
Capped Call Transactions
On September 15, 2025, in connection with the pricing of the offering of 2030 Notes, the Company entered into privately negotiated capped call transactions (the “Base Capped Call Transactions”) with certain of the 2030 Notes initial purchasers or their affiliates and certain other financial institutions (the “Option Counterparties”). In addition, on September 16, 2025, in connection with the initial purchasers’ exercise of their option to purchase additional 2030 Notes, the Company entered into additional capped call transactions (the “Additional Capped Call Transactions,” and, together with the Base Capped Call Transactions, the “Capped Call Transactions”) with each of the Option Counterparties.
The Capped Call Transactions cover the aggregate number of shares of the Company’s Class A common stock that initially underlie the 2030 Notes (subject to customary anti-dilution adjustments), and are expected to reduce potential dilution to the Company’s Class A common stock upon any conversion of 2030 Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted 2030 Notes, with such reduction and/or offset subject to a cap, based on the cap price of the Capped Call Transactions. The cap price of the Capped Call Transactions is initially $37.46 per share (subject to adjustment under the terms of the Capped Call Transactions), which represents a premium of 100% over the last reported sale price of the Company’s Class A common stock on September 15, 2025. The cost of the Capped Call Transactions was approximately $34.4 million.
For accounting purposes, the Capped Call Transactions are separated from the 2030 Notes. As the Capped Call Transactions qualify for a scope exception from derivative accounting for instruments that are both indexed to the issuer’s own stock and classified in stockholders’ equity, the premiums paid for the purchase of the Capped Call Transactions are recorded as a reduction to additional paid-in capital. The Capped Call Transactions will not be remeasured as long as they continue to meet the conditions for equity classification.
2021 Revolving Credit Facility
On December 28, 2023, the Company entered into a third amendment to its senior secured credit agreement with Wells Fargo Bank, National Association, as lender and administrative agent, and certain other lenders party thereto from time to time, and Oscar Management Corporation, as a subsidiary guarantor, which amended the senior secured credit agreement, dated as of February 21, 2021 (as amended, the “2021 Amended Credit Agreement”). The 2021 Amended Credit Agreement provided for a revolving loan credit facility (the “2021 Revolving Credit Facility”) in the aggregate principal amount of $115.0 million, with proceeds to be used for general corporate purposes of the Company. On September 18, 2025, the Company terminated the 2021 Revolving Credit Facility. At the time of termination, there were no outstanding borrowings under the 2021 Revolving Credit Facility.
Subsequent Event
On February 6, 2026, Oscar Health, Inc. entered into a $475.0 million secured three-year revolving credit facility (the “2026 Revolving Credit Facility”), pursuant to a Credit Agreement (the “2026 Credit Agreement”) by and among the Company, certain subsidiaries of the Company, as subsidiary guarantors, JPMorgan Chase Bank, N.A., as administrative agent, and the lenders party thereto. The facility is set to expire on February 6, 2029, and includes the ability for the Company to increase commitments up to an additional $100.0 million, subject to customary closing conditions. Proceeds will be used for general corporate purposes. Borrowings will initially bear interest, at the Company’s option, at Term SOFR plus 4.50% per annum or the Alternate Base Rate plus 3.50% per annum. Starting June 30, 2026, each of the commitment fee (initially 0.50% for available but undrawn amounts) and applicable interest rate margin will be adjusted based on the Company’s Total Net Leverage Ratio. The 2026 Credit Agreement contains customary conditions precedent, representations and warranties, affirmative and negative covenants, events of default and indemnities. In addition, the 2026 Revolving Credit Facility requires compliance with certain financial covenants.Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 13, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 15, 2024 | |
| 2022 | Feb 24, 2023 | |
| 2021 | Feb 25, 2022 | |
About Debt Disclosures
Debt disclosures detail a company's borrowing structure — the types of instruments, interest rates, maturity schedule, and covenant restrictions that define its financial obligations and flexibility. This section is essential for assessing refinancing risk, interest rate exposure, and the margin of safety against financial distress.
Key signals: the maturity schedule reveals concentration risk — large maturities within 1-2 years during tight credit markets can force dilutive refinancing or asset sales. Compare the fair value of debt against carrying amount to gauge whether the market views the company's credit risk differently than the balance sheet suggests. Watch covenant compliance disclosures for tightening cushions, especially leverage and interest coverage ratios. Variable-rate debt exposure quantifies sensitivity to interest rate changes. Secured versus unsecured mix affects recovery rates and future borrowing capacity. Compare net debt-to-EBITDA against industry peers and covenant limits to assess financial health.