SELECT MEDICAL HOLDINGS CORPSEM
SELECT MEDICAL HOLDINGS CORP Debt Disclosure
Long-Term Debt and Notes Payable
As of December 31, 2025, the Company’s long-term debt and notes payable are as follows:
| Principal Outstanding | Unamortized Discount | Unamortized Issuance Costs | Carrying Value | Fair Value | ||||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||
6.250% senior notes due 2032 | $ | 550,000 | $ | — | $ | (9,305) | $ | 540,695 | $ | 537,262 | ||||||||||||||||||||||
| Credit facilities: | ||||||||||||||||||||||||||||||||
| Revolving facility | 100,000 | — | — | 100,000 | 98,500 | |||||||||||||||||||||||||||
| Term loan | 1,039,500 | (2,293) | (4,807) | 1,032,400 | 1,036,901 | |||||||||||||||||||||||||||
| Other debt, including finance leases | 155,914 | — | (813) | 155,101 | 155,101 | |||||||||||||||||||||||||||
| Total debt | $ | 1,845,414 | $ | (2,293) | $ | (14,925) | $ | 1,828,196 | $ | 1,827,764 | ||||||||||||||||||||||
Principal maturities of the Company’s long-term debt and notes payable are approximately as follows:
| 2026 | 2027 | 2028 | 2029 | 2030 | Thereafter | Total | |||||||||||||||||||||||||||||||||||
| (in thousands) | |||||||||||||||||||||||||||||||||||||||||
6.250% senior notes due 2032 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | 550,000 | $ | 550,000 | |||||||||||||||||||||||||||
| Credit facilities: | |||||||||||||||||||||||||||||||||||||||||
| Revolving facility | — | — | — | 100,000 | — | — | 100,000 | ||||||||||||||||||||||||||||||||||
| Term loan | 10,500 | 10,500 | 10,500 | 10,500 | 10,500 | 987,000 | 1,039,500 | ||||||||||||||||||||||||||||||||||
| Other debt, including finance leases | 13,717 | 2,375 | 1,599 | 2,145 | 2,379 | 133,699 | 155,914 | ||||||||||||||||||||||||||||||||||
| Total debt | $ | 24,217 | $ | 12,875 | $ | 12,099 | $ | 112,645 | $ | 12,879 | $ | 1,670,699 | $ | 1,845,414 | |||||||||||||||||||||||||||
As of December 31, 2024, the Company’s long-term debt and notes payable are as follows:
| Principal Outstanding | Unamortized Discount | Unamortized Issuance Costs | Carrying Value | Fair Value | ||||||||||||||||||||||||||||
| (in thousands) | ||||||||||||||||||||||||||||||||
6.250% senior notes due 2032 | $ | 550,000 | $ | — | $ | (10,637) | $ | 539,363 | $ | 528,000 | ||||||||||||||||||||||
| Credit facilities: | ||||||||||||||||||||||||||||||||
| Revolving facility | 105,000 | — | — | 105,000 | 102,900 | |||||||||||||||||||||||||||
| Term loan | 1,050,000 | (2,693) | (5,646) | 1,041,661 | 1,051,313 | |||||||||||||||||||||||||||
| Other debt, including finance leases | 26,282 | — | (491) | 25,791 | 25,791 | |||||||||||||||||||||||||||
| Total debt | $ | 1,731,282 | $ | (2,693) | $ | (16,774) | $ | 1,711,815 | $ | 1,708,004 | ||||||||||||||||||||||
Credit Facilities
On March 6, 2017, Select entered into a senior secured credit agreement (the “credit agreement”). The credit agreement has provided $1,050.0 million in term loan borrowings (the “term loan”) and the Company has the ability to borrow $600.0 million under a revolving credit facility (the “revolving facility” and, together with the term loan, the “credit facilities”), including a $125.0 million sublimit for the issuance of standby letters of credit. At December 31, 2025, Select had $469.1 million of availability under the revolving facility after giving effect to $100.0 million of outstanding borrowings and $30.9 million of outstanding letters of credit. The maturity date of the term loan is December 3, 2031 and the maturity date of the revolving facility is December 3, 2029.
The interest rate on the term loan is equal to Term SOFR plus 2.00%, or the Alternative Base Rate (as defined in the credit agreement) plus 1.00%. The interest rate on the revolving facility is equal to Adjusted Term SOFR plus a percentage ranging from 2.25% to 2.50%, or the Alternative Base Rate (as defined in the credit agreement) plus a percentage ranging from 1.25% to 1.50%, in each case subject to a specified leverage ratio. As of December 31, 2025, the term loan borrowings bear interest at a rate that is indexed to one-month Term SOFR plus 2.00%. As of December 31, 2025, the revolving facility borrowings bear interest either at a rate indexed to one-month Adjusted Term SOFR plus 2.25% or the Alternative Base Rate plus 1.25%.
The revolving facility requires Select to maintain a leverage ratio, as specified in the credit agreement, not to exceed 7.00 to 1.00. As of December 31, 2025, Select’s leverage ratio was 3.67 to 1.00.
Borrowings under the credit facilities are guaranteed by Holdings and substantially all of Select’s current domestic subsidiaries, other than certain non-guarantor subsidiaries, and will be guaranteed by substantially all of Select’s future domestic subsidiaries. Borrowings under the credit facilities are secured by substantially all of Select’s existing and future property and assets and by a pledge of Select’s capital stock, the capital stock of Select’s domestic subsidiaries, other than certain non-guarantor subsidiaries, and up to 65% of the capital stock of Select’s foreign subsidiaries held directly by Select or a domestic subsidiary.
Prepayment of Borrowings
Select will be required to prepay borrowings under the credit facilities with (i) the net cash proceeds received from non-ordinary course asset sales or other dispositions, or as a result of a casualty or condemnation, subject to reinvestment provisions and other customary carveouts and, to the extent required, the payment of certain indebtedness secured by liens having priority over the debt under the credit facilities or subject to a first lien intercreditor agreement, (ii) the net cash proceeds received from the issuance of debt obligations other than certain permitted debt obligations, and (iii) a percentage of excess cash flow (as defined in the credit agreement) based on Select’s leverage ratio, as specified in the credit agreement. The Company will not be required to make a prepayment of borrowings as a result of excess cash flow for the year ended December 31, 2025.
Select 6.250% Senior Notes due 2032
On December 3, 2024, Select issued and sold $550.0 million aggregate principal amount of 6.250% senior notes due December 1, 2032. Interest on the 2032 senior notes accrues at the rate of 6.250% per annum and is payable semi-annually in arrears on June 1 and December 1 of each year, beginning on June 1, 2025.
The senior notes are Select’s senior unsecured obligations which are subordinated to all of Select’s existing and future secured indebtedness, including its credit facilities. The senior notes rank equally in right of payment with all of Select’s other existing and future senior unsecured indebtedness and senior in right of payment to all of Select’s existing and future subordinated indebtedness. The senior notes are unconditionally guaranteed on a joint and several basis by each of Select’s direct or indirect existing and future domestic restricted subsidiaries, other than certain non-guarantor subsidiaries.
Select may redeem some or all of the notes prior to December 1, 2027 by paying a “make-whole” premium. Select may redeem some or all of he notes on or after December 1, 2027 at specified redemption prices. The prices which would be paid if redeemed during the twelve-month period beginning on December 1 of the years indicated below are as follows:
| Year | Percentage | |||||||
| 2027 | 103.125 | % | ||||||
| 2028 | 101.563 | % | ||||||
| 2029 and thereafter | 100.000 | % | ||||||
Select is obligated to offer to repurchase the senior notes at a price of 101% of their principal amount plus accrued and unpaid interest, if any, as a result of certain change of control events. These restrictions and prohibitions are subject to certain qualifications and exceptions.
Loss on Early Retirement of Debt
During the year ended December 31, 2024, the Company repaid the term loan, refinanced the Select credit facilities and the senior notes which resulted in a loss on early retirement of debt of $28.8 million.
During the year ended December 31, 2023, the Company refinanced the Select credit facilities which resulted in a loss on early retirement of debt of $14.7 million.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Feb 19, 2026 | Showing above |
| 2024 | Feb 20, 2025 | |
| 2023 | Feb 22, 2024 | |
| 2022 | Feb 23, 2023 | |
| 2021 | Feb 24, 2022 | |
| 2020 | Feb 25, 2021 | |
| 2019 | Feb 20, 2020 | |
| 2018 | Feb 21, 2019 | |
| 2017 | Feb 22, 2018 | |
| 2016 | Feb 23, 2017 | |
| 2015 | Feb 26, 2016 | |
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.