U.S. Physical Therapy, Inc. entered into a 45-month forward-starting interest rate swap with Bank of America, National Association on September 22, 2026, to fix the variable interest on its term debt at a rate of 4.578% per annum. The agreement, which carries an initial notional amount of $170.6 million, is designed to manage the company's exposure to fluctuating borrowing costs on its existing credit facilities.
The swap becomes effective on June 30, 2027, a date that coincides with the expiration of the company's current interest rate swap agreement. By locking in the fixed rate now, U.S. Physical Therapy aims to stabilize its financial obligations under the Fourth Amended and Restated Credit Agreement dated April 14, 2026. The notional amount reflects the projected term loan amortization as of the swap's effective date, ensuring the hedge aligns with the actual debt balance at that time.
Under the terms of the new agreement, the company will make monthly payments at the fixed rate of 4.578% per annum. In return, it will receive variable payments based on the one-month SOFR interest rate for the same notional amount. This structure allows the company to exchange its variable-rate exposure for a predictable fixed cost during the life of the instrument. The swap will amortize in line with the term loan payment schedule under the Credit Agreement and will terminate on April 14, 2031.
Bank of America serves as both the counterparty to this new swap and as the Administrative Agent and lender under the underlying Credit Agreement. The transaction is governed by an ISDA Master Agreement originally dated April 26, 2022, which has been amended and supplemented over time. The full legal descriptions of both the master agreement and the specific rate swap transaction confirmation are filed as exhibits to the company's Form 8-K current report.
The company disclosed this development in a Form 8-K filed with the Securities and Exchange Commission on September 28, 2026. Nchacha Etta, Chief Financial Officer of U.S. Physical Therapy, Inc., signed the report as a duly authorized officer and principal financial and accounting officer. The filing indicates that U.S. Physical Therapy is not an emerging growth company and trades its common stock on the New York Stock Exchange under the symbol USPH.