XML 264 R18.htm IDEA: XBRL DOCUMENT v3.25.3
Debt
 9 Months Ended
Sep. 26, 2025
Debt Disclosure [Abstract]  
Debt Disclosure
11.Debt
Debt was comprised of the following at the end of each period:
September 26, 2025December 27, 2024
Principal
Carrying Value
Unamortized Discount and Debt Issuance Costs
Principal
Carrying Value
Unamortized Discount and Debt Issuance Costs
Current maturities of long-term debt:
Term Loan due July 2030$22.5 $22.5$—$—$— $—
Term Loan due April 203115.0 15.0 — — — — 
Second-Out Takeback Term Loan due November 2028— — — 3.9 3.9 — 
Total current maturities of long-term debt$37.5 $37.5 $— $3.9 $3.9 $— 
Long-term debt:

Term Loan due July 2030$1,177.5 $1,177.5$26.1$—$— $—
Term Loan due April 2031 (1)
1,470.0 1,476.4 ————
8.50% Senior Secured Notes Due April 2031 (1)
1,000.0 1,062.8 ————
Revolving Credit Facility due July 2030— — 1.5— — — 
Second-Out Takeback Term Loan due November 2028— — — 384.5 406.3 — 
14.75% Second-Out Takeback Notes due November 2028— — —477.2505.4 —
Receivables financing facility due December 2027— ———— 2.2
Total long-term debt$3,647.5 $3,716.7 $27.6 

$861.7 $911.7 $2.2 
Total debt$3,685.0 $3,754.2 $27.6 $865.6 $915.6 $2.2 
(1)As a result of the Business Combination, the Company recorded its acquired debt instruments at fair value. The Company accounted for its debt instruments utilizing the amortized cost method and amortizes the fair value premium to the principal amount over the term of the respective instruments. Such amortization expense is reflected as interest expense on the unaudited condensed consolidated statement of operations.
Takeback debt
On November 14, 2023, the Company entered into a senior secured first lien term loan facility with an aggregate principal amount of approximately $871.4 million (“Takeback Term Loans”), consisting of approximately $229.4 million of “first-out” Takeback Term Loans (“First-Out Takeback Term Loans”) and approximately $642.0 million of “second-out” Takeback Term Loans (“Second-Out Takeback Term Loans”). The Company also issued approximately $778.6 million in aggregate principal amount of “second-out” 14.75% senior secured first lien notes due 2028 (“Takeback Notes”).
On December 6, 2024, the Company (i) mandatorily prepaid a portion of its Takeback Term Loans in an aggregate principal amount of approximately $474.1 million (of which approximately $227.1 million consisted of its First-Out Takeback Term Loans and approximately $247.0 million consisted of its Second-Out Takeback Loans) together with a payment of approximately $36.4 million in required makewhole premium (of which approximately $15.2 million was in respect of its First-Out Takeback Term Loans and approximately $21.2 million was in respect of its Second-Out Takeback Term Loans) and (ii) mandatorily redeemed $301.4 million in aggregate principal amount of Takeback Notes together with a payment of approximately $27.3 million in required makewhole premium. As a result of the mandatory prepayment, the Company recorded $19.7 million as a net loss on extinguishment of debt, comprised of the $63.7 million payment of the makewhole premium, offset by a $44.0 million gain to write-off certain unamortized premiums.
On August 1, 2025, in connection with the consummation of the Business Combination, Mallinckrodt and its subsidiaries (i) prepaid in full approximately $385.5 million in outstanding aggregate principal amount of the Second-Out Takeback Term Loans, constituting all of the remaining indebtedness outstanding under the existing Mallinckrodt credit agreement, together with accrued and unpaid interest thereon, as well as a payment of approximately $10.6 million in required makewhole premium and (ii) repaid all amounts outstanding under the receivables financing facility due December 2027 (“Existing ABL Facility”).
Also in connection with the consummation of the Business Combination, on August 1, 2025, Mallinckrodt and its subsidiaries redeemed in full approximately $477.2 million in outstanding principal amount of Takeback Notes, constituting all of the existing Takeback Notes outstanding under the existing Mallinckrodt indenture, for a redemption price equal to such outstanding principal amount, accrued and unpaid interest thereon and approximately $13.7 million in required makewhole premium. As a result of such prepayment, redemption and repayment, the existing Mallinckrodt credit agreement and the Existing ABL Facility were terminated, the existing Mallinckrodt indenture was discharged and all guarantees of, and liens securing, the obligations thereunder were released.
As a result of the mandatory prepayment, the Company recorded $4.6 million as a net gain on debt extinguishment, comprised of $40.2 million to write-off certain unamortized premiums net of debt issuance costs write-offs, offset by the $24.3 million payment of the makewhole premium and $11.3 million in debt fees.
New Credit Agreement
On July 31, 2025, in connection with the consummation of the Business Combination, ST 2020, Inc. (“Parent”), a wholly owned subsidiary of Mallinckrodt, and MEH, Inc. (“Borrower”), a wholly owned subsidiary of Parent, entered into a credit agreement (as amended, modified or supplemented, the “New Credit Agreement”) with the lenders named therein, Wilmington Savings Fund Society, FSB, as administrative agent and collateral agent, and OPY Credit Corp., as trading agent, providing for $1,350.0 million in aggregate principal amount of senior secured credit facilities (“Facilities”), comprising (i) a $1,200.0 million senior secured term loan facility with a maturity date of July 31, 2030 (“Term Facility due July 2030”) and (ii) a $150.0 million senior secured revolving credit facility with a maturity date of July 31, 2030 (“Revolving Credit Facility due July 2030”). The Borrower borrowed $1,200.0 million under the Term Facility due July 2030 on August 1, 2025. The Facilities mature on July 31, 2030, unless extended pursuant to the terms of the New Credit Agreement.
The Term Facility due July 2030 will amortize in quarterly installments as follows: (i) commencing with the fiscal quarter ending December 31, 2025 through (and including) the fiscal quarter ending September 30, 2026, 0.625% of the initial aggregate principal amount of the Term Facility due July 2030, (ii) from the last day of the fiscal quarter ending December 31, 2026 through (and including) the last day of the fiscal quarter ending September 30, 2027, 1.25% of the initial aggregate principal amount of the Term Facility due July 2030, (iii) from the last day of the fiscal quarter ending December 31, 2027 through (and including) the last day of the fiscal quarter ending September 30, 2028, 1.875% of the initial aggregate principal amount of the Term Facility due July 2030 and (iv) from the last day of the fiscal quarter ending December 31, 2028 through the maturity date of the Term Facility due July 2030, 2.50% of the initial aggregate principal amount of the Term Facility due July 2030, with the balance payable on the maturity date of the Term Facility due July 2030.
The Facilities are subject to mandatory prepayment provisions, including requirements to prepay the Term Facility due July 2030 with (i) 75% of annual Excess Cash Flow (as defined in the New Credit Agreement), beginning with the 2026 fiscal year, to prepay the Term Facility due July 2030 (subject to specified adjustments and with the applicable percentage being reduced to (x) 50% if the first lien net leverage ratio as of the end of the applicable fiscal year is less than or equal to 1.90 to 1.00, but greater than 1.40 to 1.00 and (y) 25% if the first lien net leverage ratio as of the end of the applicable fiscal year is less than or equal to 1.40 to 1.00) and (ii) 100% of the net proceeds of asset sales and casualty events (subject to customary exceptions and customary reinvestment provisions). Amounts outstanding under the Facilities may be prepaid at any time. Certain mandatory and voluntary prepayments of the Term Facility due July 2030 are subject to payment of a premium equal to (a) before July 31, 2026, a customary make-whole premium, (b) on or after July 31, 2026, but before July 31, 2027, 2.0% of the aggregate principal amount of loans under the Term Facility due July 2030 being prepaid, (c) on or after July 31, 2027, but before July 31, 2028, 1.0% of the aggregate principal amount of loans under the Term Facility due July 2030 being prepaid and (d) thereafter, $0.
The New Credit Agreement contains customary representations and warranties, as well as customary affirmative and negative covenants applicable to Parent and its subsidiaries (including Borrower), including covenants governing: incurrence of liens, incurrence of indebtedness, fundamental changes, asset sales, restricted payments and investments, transactions with affiliates, burdensome agreements, modification of terms of restricted junior indebtedness, changes in nature of business and accounting changes. Additionally, in the event the aggregate outstanding revolving credit exposure under the Revolving Credit Facility due July 2030 exceeds 40% of the aggregate revolving commitments then in effect, Parent and the Borrower will be required to comply with a maximum first lien net leverage ratio commencing with the test period ending December 31, 2025 not to exceed (i) on or before March 31, 2027, 4.00 to 1.00, (ii) after March 31, 2027 and on or before March 31, 2028, 3.25 to 1.00 and (iii) thereafter, 2.50 to 1.00. The New Credit Agreement also contains customary events of default relating to, among other things, failure to make payments, breach of covenants and breach of representations. Borrowings under the Facilities will be made in U.S. dollars and bear interest at rates per annum, determined, at Borrower’s option, by reference to (i) for base rate loans, the applicable base rate (subject to a 3.00% floor) plus 6.00% and (ii) for SOFR loans, the applicable Term SOFR (as defined in the New Credit Agreement) (subject to a 2.00% floor) plus 7.00%. Borrower is also required to pay quarterly in arrears a commitment fee on undrawn commitments under the Revolving Credit Facility at a per annum rate equal to 0.25%.
The obligations under the New Credit Agreement are guaranteed by Parent and certain subsidiaries of Borrower from time to time and secured by a lien on substantially all the assets (with certain exceptions) of Borrower and such guarantors in accordance with the terms of the New Credit Agreement and the related security documents.
As of September 26, 2025, the aggregate outstanding principal amount of loans under the Term Facility due July 2030 was $1,200.0 million and the Revolving Facility due July 2030 was undrawn.
The Company capitalized $28.3 million of certain third-party debt issuance costs in connection with executing the New Credit Agreement. Approximately $26.8 million of the capitalized costs were attributed to the New Credit Agreement and were recorded as a direct reduction of long-term debt on the Company’s Consolidated Balance Sheet. Approximately $1.5 million of the capitalized costs were attributed to the Revolving Credit Facility due July 2030 and were recorded within other assets on the Company’s Consolidated Balance Sheet. These capitalized costs will be amortized into interest expense over the five-year term of the New Credit Agreement.

Endo’s Indebtedness that Remained Outstanding after the Business Combination
After the consummation of the Business Combination, Endo’s existing indebtedness remained outstanding, including existing credit facilities comprised of a revolving credit facility and term loan facility and senior secured notes. Refer to Note 3 for further information on the Business Combination.
Endo Credit Facilities
After the consummation of the Business Combination, Endo’s existing credit facilities remained outstanding. Endo’s outstanding credit facilities consist of (i) a revolving credit facility with a maturity date of April 23, 2029 and commitments equal to $400.0 million (“Revolving Credit Facility due April 2029”) and (ii) a term facility with a maturity date of April 23, 2031 with an outstanding principal balance of $1,489 million (“Term Facility due April 2031”, together with the Revolving Credit Facility due April 2029, the “Endo Credit Facilities”). As of the consummation of the Business Combination approximately $396.0 million of capacity under the Revolving Credit Facility due April 2029 is undrawn and available to Endo, net of outstanding standby letters of credit.
The Endo Credit Facilities are governed by that certain credit agreement, dated as of April 23, 2024, among Endo Finance Holdings LP (f/k/a Endo Finance Holdings, Inc.), as the borrower (“Endo Borrower”), Endo, as parent, the lenders from time to time party thereto and Goldman Sachs Bank USA, as administrative agent, collateral agent, issuing bank and swingline lender (as amended, modified or supplemented, the “Endo Credit Agreement”). The Endo Credit Agreement contains mandatory prepayment provisions, representations and warranties, affirmative and negative covenants and events of default that, in each case, the Company believes to be customary for senior secured credit facilities of this type. The negative covenants include, among other things, indebtedness, fundamental changes, dispositions of property and assets (including sale-leaseback transactions), investments, restricted payments, restrictive agreements, transactions with affiliates, swap arrangements, amending subordinated debt documents, changes in fiscal year and changes in the nature of business. If Endo draws more than 40% of total available credit under its Revolving Credit Facility due April 2029 (other than (a) undrawn letters of credit in an amount not to exceed $20.0 million and (b) cash collateralized or backstopped letters of credit), Endo will be required to comply with a maximum first lien net leverage ratio not to exceed 6.10 to 1.00.
Borrowings bear interest, at the borrower’s election, based on: (x) under the Revolving Credit Facility due April 2029, (i) the alternate base rate; (ii) the Canadian prime rate; (iii) Term SOFR (as defined in the Endo Credit Agreement); or (iv) Adjusted Term CORRA (as defined in the Endo Credit Agreement) and (y) under the Term Facility due April 2031, (i) the alternate base rate or (ii) Term SOFR (as defined in the Endo Credit Agreement), in each case, plus the applicable margin; provided that Term SOFR and Adjusted Term CORRA shall not be less than, with respect to loans under the Revolving Credit Facility due April 2029, 0.00% per annum, and with respect to loans under the Term Facility due April 2031, 0.50%. The applicable margins are based upon a first lien net leverage ratio as set forth in the Endo Credit Agreement, which range from: (i) for loans under the Revolving Credit Facility due April 2029 based on (x) Term SOFR or Adjusted Term CORRA, 3.00% to 3.50% and (y) alternate base rate or Canadian prime rate, 2.00% to 2.50%; and (ii) for loans under the Term Facility due April 2031 based on (x) Term SOFR, 3.75% to 4.00% and (y) alternate base rate, 2.75% to 3.00%. The Endo Borrower is also required to pay quarterly in arrears a commitment fee on undrawn commitments under the Revolving Credit Facility due 2029 at a per annum rate, based upon a first lien net leverage ratio, of 0.25% to 0.50%.
As of September 26, 2025, the aggregate outstanding principal amount of loans under the Term Facility due April 2031 was $1,485.0 million and approximately $396.0 million of capacity under the Revolving Credit Facility due April 2029 was undrawn and available to the Endo Borrower, net of outstanding standby letters of credit.
The obligations under the Endo Credit Agreement are guaranteed by Endo and certain of its subsidiaries (“Guarantors”) and secured by a lien on substantially all the assets (with certain exceptions) of the Endo Borrower and the Guarantors in accordance with the terms of the Endo Credit Agreement, the other related security documents and that certain first lien intercreditor agreement, dated as of April 23, 2024, among the notes collateral agent for the 8.50% Senior Secured Notes due April 2031 (as defined below), the collateral agent for the Endo Credit Agreement, the Endo Borrower, the Guarantors from time to time party thereto and the other agents from time to time party thereto (as amended, modified or supplemented, the “Intercreditor Agreement”).
Pursuant to the Intercreditor Agreement, with respect to any Shared Collateral (as defined in the Intercreditor Agreement) proceeds received after the occurrence, and during the continuance, of an event of default under the applicable secured debt documents and certain other circumstances, holders of the obligations under the Revolving Credit Facility due April 2029 and certain specified cash management and hedging obligations secured in connection therewith (the “Revolving Facility Obligations”), shall be paid prior to the obligations under the Term Facility due April 2031 and the obligations under the Indenture for the 8.50% Senior Secured Notes due April 2031. Moreover, the collateral agent for the Endo Credit Agreement is the controlling agent under the Intercreditor Agreement and, prior to the discharge of the Revolving Facility Obligations, will take direction from lenders holding a majority of the commitments under the Revolving Credit Facility due April 2029 in respect of the exercise of rights and remedies, including in any insolvency proceeding, consent to debtor-in-possession financing, sale of collateral, use of cash collateral, adequate protection and other customary bankruptcy provisions.
Endo’s 8.50% Senior Secured Notes due April 2031
After the consummation of the Business Combination, 8.50% Senior Secured Notes with a maturity date of April 15, 2031 issued by the Endo Borrower remained outstanding (the “8.50% Senior Secured Notes due April 2031”). As of September 26, 2025, the 8.50% Senior Secured Notes due April 2031 had an outstanding principal balance of $1,000.0 million. The 8.50% Senior Secured Notes due April 2031 are obligations of the Endo Borrower (and a subsidiary thereof), are guaranteed by the Guarantors and are secured by a lien on substantially all the assets (with certain exceptions) of the Endo Borrower and the Guarantors in accordance with the terms of the Indenture (as defined below), the other related security documents and the Intercreditor Agreement. The 8.50% Senior Secured Notes due April 2031 will mature on April 15, 2031, subject to earlier repurchase or redemption in accordance with the terms of the Indenture (as defined below), and bear interest at 8.50% per annum, payable semi-annually in cash in arrears on April 15 and October 15 of each year, commencing on October 15, 2024.
At any time prior to April 15, 2027, the 8.50% Senior Secured Notes due April 2031 are redeemable by the Endo Borrower, in whole or in part, at a redemption price equal to 100.00% of the principal amount of the 8.50% Senior Secured Notes due April 2031 redeemed, plus the greater of 1.0% of the principal amount of the 8.50% Senior Secured Notes due April 2031 redeemed and a “make-whole” premium, plus accrued and unpaid interest, if any, to, but not including, the date of redemption.
At any time prior to April 15, 2027, the Endo Borrower may redeem up to 10.00% of the original aggregate principal amount of the 8.50% Senior Secured Notes due April 2031 during each twelve-month period commencing with April 23, 2024 at a redemption price equal to 103.00% of the principal amount thereof, plus accrued and unpaid interest, if any, to, but not including, the date of redemption.
At any time prior to April 15, 2027, the Endo Borrower may redeem up to 40.00% of the aggregate principal amount of the 8.50% Senior Secured Notes due April 2031 with the net cash proceeds from specified equity offerings at a redemption price equal to 108.50% of the aggregate principal amount of the 8.50% Senior Secured Notes due April 2031 redeemed, plus accrued and unpaid interest, if any, to, but not including, the date of redemption.
If Endo experiences certain change of control events, the Endo Borrower must offer to repurchase the 8.50% Senior Secured Notes due April 2031 at 101.00% of their aggregate principal amount, plus accrued and unpaid interest, if any, to, but not including, the date of purchase.
On or after April 15, 2027, the Endo Borrower may on any one or more occasions redeem all or part of the 8.50% Senior Secured Notes due April 2031 at a redemption price expressed as a percentage of the principal amount thereof, which percentages are 104.25% for the twelve-month period beginning on April 15, 2027; 102.125% for the twelve-month period beginning on April 15, 2028; and 100.00% beginning on April 15, 2029 and thereafter, in each case, plus accrued and unpaid interest, if any, to, but not including, the date of redemption.
The 8.50% Senior Secured Notes due April 2031 and the guarantees thereof were issued pursuant to an indenture by and among the Endo Borrower, Endo, the subsidiary guarantors from time to time party thereto and Computershare Trust Company, National Association, as trustee and notes collateral agent (as amended, modified or supplemented, the “Indenture”). The Indenture contains customary events of default, as well as covenants that, among other things, restrict Endo’s ability and the ability of its restricted subsidiaries to incur certain additional indebtedness and issue preferred stock, make certain dividend payments, distributions, investments and other restricted payments, sell certain assets, agree to any restrictions on the ability of restricted subsidiaries to make payments to the Endo Borrower, create certain liens, merge, consolidate, or sell all or substantially all of Endo’s or any restricted subsidiary’s assets, or enter into certain transactions with affiliates. These covenants are subject to a number of important exceptions and qualifications, including the suspension of certain of these covenants upon the 8.50% Senior Secured Notes due April 2031 receiving investment grade credit ratings.
Applicable interest rate
As of September 26, 2025, the applicable interest rate on the Company's debt instruments were as follows:
Applicable Interest Rate
Term Loan due July 203011.3 %
Term Loan due April 2031 (1)
8.0 %
8.50% Senior Secured Notes due April 20318.5 %
(1)Includes the impact of the interest rate cap agreement, which is discussed further in Note 14.
The Company's stated long-term debt principal maturity amounts in the next five fiscal years as of September 26, 2025 are as follows:
Remainder of FY 2025$15.0 
Fiscal 202652.5 
Fiscal 202782.5 
Fiscal 2028
112.5 
Fiscal 2029135.0 
Fiscal 2030885.0