Oncology Institute, Inc. 8-K

What Happened

• Oncology Institute, Inc. announced a Credit Agreement dated July 1, 2026 with Orbimed Opportunities (CA) V LLC as the initial lender and administrative agent, providing a $75.0 million term loan facility that was drawn in full on the Closing Date. The Company used the loan proceeds, together with cash on hand, to repay in full its 4% senior secured convertible notes due 2027 (approximately $86 million principal outstanding as of July 1, 2026). The loan matures on the earlier of July 1, 2031 or upon acceleration on an event of default.

Key Details

• Loan amount drawn: $75.0 million (Closing Date: July 1, 2026).
• Interest: greater of (i) a forward‑looking one‑month term SOFR and (ii) 3.00%, in each case plus a spread of 5.75% (paid monthly).
• Security & guarantees: secured by a first‑priority lien on substantially all assets and guaranteed by certain direct and indirect subsidiaries under a Pledge and Security Agreement dated July 1, 2026.
• Covenants & amortization: includes customary affirmative/negative covenants and a minimum net revenue requirement of at least $700 million on a trailing 12‑month basis beginning with the period ending Dec 31, 2027; loans begin quarterly amortization (7.5% of outstanding principal each quarter) starting with the first fiscal quarter ending after the 36‑month anniversary of the Closing Date, plus repayment premium and exit fee.
• Equity-related item: as part of the 2027 note repayment, the Company issued warrants to Deerfield Partners, L.P. and affiliates on July 1, 2026 — 10,025,535 underlying shares, initial exercise price $8.567, expiration Aug 9, 2027; no additional cash consideration was paid.

Why It Matters

• This transaction refines the Company’s capital structure: it replaces 2027 convertible debt (≈$86M principal) with a $75M secured term loan and cash, extending the debt maturity to 2031 but creating a secured first‑priority lien on substantially all assets and adding financial and operational covenants.
• The loan’s interest spread and the quarterly amortization (beginning after 3 years) affect future cash interest and principal outflows; the revenue covenant ($700M trailing 12 months starting end of 2027) is a material operating milestone investors should monitor.
• The issued warrants could dilute common shareholders if exercised prior to Aug 9, 2027; conversely, repayment of the convertible notes removes conversion risk tied to that earlier instrument.