Attached files
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EX-10.1 - EX-10.1 - COVENTRY HEALTH CARE INC | g27564exv10w1.htm |
EX-99.1 - EX-99.1 - COVENTRY HEALTH CARE INC | g27564exv99w1.htm |
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported)
June 22, 2011 (June 22, 2011)
June 22, 2011 (June 22, 2011)
COVENTRY HEALTH CARE, INC.
(Exact name of registrant as specified in its charter).
Delaware | 1-16477 | 52-2073000 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification Number) |
6705 Rockledge Drive, Suite 900, Bethesda, Maryland 20817
(Address of principal executive offices) (Zip Code)
(Address of principal executive offices) (Zip Code)
(301) 581-0600
(Registrants telephone number, including area code)
(Registrants telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions (see General Instruction
A.2. below):
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o
Precommencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Precommencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
TABLE OF CONTENTS
Item 1.01
|
Entry into a Material Definitive Agreement | |
Item 1.02
|
Termination of a Material Definitive Agreement | |
Item 2.03
|
Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant | |
Item 8.01
|
Other Events | |
Item 9.01
|
Financial Statements and Exhibits | |
Ex-10.1
|
Credit Agreement | |
Ex-99.1
|
Press Release |
SECTION 1 REGISTRANTS BUSINESS AND OPERATIONS
Item 1.01 Entry into a Material Definitive Agreement
Coventry Health Care, Inc. (the Company) entered into a new $750,000,000 Credit Agreement,
dated as of June 22, 2011 (the Credit Agreement) with the banks, financial institutions and other
lenders and issuers of letters of credit from time to time parties thereto, JPMorgan Chase Bank,
National Association as Administrative Agent, Citibank, N.A. and Bank of America, N.A. as
Syndication Agents and J.P. Morgan Securities LLC, Citigroup Global Markets, Inc. and Merrill,
Lynch, Pierce, Fenner & Smith Incorporated as Joint Lead Arrangers and Joint Bookrunners. The
Credit Agreement provides for a five-year revolving credit facility in the principal amount of
$750,000,000 with the Company having the ability to request an increase in the facility up to an
amount not to exceed $1,000,000,000. The obligations under the Credit Agreement are general
unsecured obligations of the Company.
Advances under the Credit Agreement bear interest at (1) a rate per annum equal to the
Administrative Agents base rate (the Base Rate) or (2) the one-, two-, three-, six-, nine-, or
twelve-month rate per annum for Eurodollar deposits (the Eurodollar Rate) plus an applicable
margin, as selected by the Company. The applicable margin for Eurodollar Rate advances depends on
the Companys debt ratings and varies from 1.050% to 1.850%.
The credit facility provides for a $100,000,000 subfacility for letters of credit. Letter of
credit fees are payable in respect of outstanding letters of credit at a rate per annum equal to
the applicable margin for Eurodollar Rate advances in effect from time to time.
Commitment fees on the credit facility are payable regardless of usage at rates per annum
ranging from 0.200% to 0.400%, depending on the Companys debt ratings.
The Credit Agreement contains various affirmative and negative covenants, including, among
others, covenants that restrict the ability of the Company and its subsidiaries to create or permit
liens on assets, make accounting changes other than as required or permitted by generally accepted
accounting principles, dispose of substantially all of the consolidated assets of the Company or
enter into new unrelated lines of business. The Credit Agreement also includes covenants that
restrict the ability of the Company to engage in mergers or consolidations where the Company is not
the surviving corporation and that restrict the ability of the Companys subsidiaries to incur
indebtedness and guarantee obligations. The Credit Agreement also requires compliance with a
maximum leverage ratio test.
If an event of default under the credit facility shall occur and be continuing, the
commitments under the credit facility may be terminated and the principal amount outstanding under
the credit facility, together with all accrued unpaid interest and other amounts owing under the
Credit Agreement and related loan documents, may be declared immediately due and payable. The
Company also would be required to cash-collateralize any letters of credit outstanding under the
credit facility.
Extensions
of credit under the Credit Agreement will be used for general
corporate purposes.
The description of the Credit Agreement set forth in this Form 8-K is qualified in its
entirety by reference to the Credit Agreement, which is attached hereto as Exhibit 10.1.
Item 1.02 Termination of a Material Definitive Agreement
Effective June 22, 2011, the Company terminated its Amended and Restated Credit Agreement (the
Terminated Credit Agreement) with the lenders named therein, Citibank, N.A., as Administrative
Agent, JPMorgan Chase Bank, N.A. as Syndication Agent, Deutsche Bank Securities, Inc., Lehman
Brothers Commercial Bank and The Royal Bank of Scotland PLC, as Co-Documentation Agents, and
Citigroup Global Markets Inc. and J.P. Morgan Securities Inc., as Joint Lead Arrangers and Joint
Bookrunners. The Terminated Credit Agreement was set to expire July 11, 2012.
SECTION 2 FINANCIAL INFORMATION
Item 2.03 Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet
Arrangement of a Registrant
Item 1.01 is incorporated by reference into this Item 2.03 to the extent it describes the
creation of a direct financial obligation.
SECTION 8 OTHER EVENTS
Item 8.01 Other Events
On June 22, 2011, the Company issued a press release regarding the entry into the new Credit
Agreement. The press release is furnished herewith as Exhibit 99.1.
SECTION 9 FINANCIAL STATEMENTS AND EXHIBITS
Item 9.01
Financial Statements and Exhibits
(d) | Exhibits. |
Exhibit No. | Description of Exhibit | |
10.1
|
Credit Agreement, dated as of June 22, 2011, among Coventry Health Care, Inc., as Borrower, the lenders named therein, as Initial Lenders, the initial issuing banks named therein, as Initial Issuing Banks, JPMorgan Chase Bank, National Association, as Administrative Agent, Citibank, N.A. and Bank of America, N.A. as Syndication Agents and J.P. Morgan Securities LLC, Citigroup Global Markets, Inc. and Merrill, Lynch, Pierce, Fenner & Smith Incorporated as Joint Lead Arrangers and Joint Bookrunners. | |
99.1
|
Coventry Health Care, Inc.s press release dated June 22, 2011, containing information related to entry into the new Credit Agreement. |
Signature(s)
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly
caused this Report to be signed on its behalf by the undersigned hereunto duly authorized.
COVENTRY HEALTH CARE, INC. |
||||
By: | /s/ John J. Ruhlmann | |||
John J. Ruhlmann | ||||
Senior Vice President and Corporate Controller | ||||
Dated: June 22, 2011 | ||||