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SUBSEQUENT EVENTS | 3 Months Ended
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Mar. 31, 2020
Subsequent Events [Abstract] |
SUBSEQUENT EVENTS | SUBSEQUENT EVENTS On April 6, 2020, the Company completed its acquisition of select assets which constitute substantially all of the operations of Memorial Hermann Diagnostic Laboratories, the outreach laboratory division of Memorial Hermann, in an all cash transaction for $120 million. Based on the preliminary purchase price allocation, the Company expects to recognize approximately $30 million of customer-related intangible assets, and approximately $90 million of goodwill. All of the goodwill acquired in connection with the acquisition has been allocated to the Company's DIS business. See Note 5 to the interim unaudited consolidated financial statements for more information about the acquisition. In April 2020, the Company borrowed $100 million under its secured receivables credit facility and $100 million under its senior unsecured revolving credit facility. See Note 8 for further discussion of such facilities. In April 2020, the Company terminated its existing fixed-to-variable interest rate swap agreements. As a result of the termination, the Company received proceeds of $40 million. Such amount will be amortized as a reduction of interest expense over the remaining terms of the hedged debt instruments. In March 2020, in response to the COVID-19 pandemic, the Coronavirus Aid, Relief, and Economic Security Act ("CARES Act") was signed into law. The CARES Act provides numerous tax provisions and other stimulus measures, including temporary changes regarding the prior and future utilization of net operating losses, temporary changes to the prior and future limitations on interest deductions, temporary suspension of certain payment requirements for the employer portion of social security taxes, technical corrections from prior tax legislation for tax depreciation of certain qualified improvement property, and the creation of certain payroll tax credits associated with the retention of employees. The CARES Act also includes a number of benefits that are applicable to the Company and other healthcare providers including, but not limited to, the appropriation of $100 billion to health care providers for related expenses or lost revenues that are attributable to the COVID-19 pandemic. In April 2020, the Company received approximately $65 million from the initial tranche of $30 billion that was distributed to health care providers. On April 30, 2020, the Company entered into an amendment to its senior unsecured revolving credit facility in order to provide for increased flexibility under the leverage ratio covenant. Pursuant to the amendment, the leverage ratio covenant was increased from the second quarter of 2020 through the second quarter of 2021 as follows:
As of: |  | Applicable Covenant:
June 30, 2020 |  | no more than 5 times EBITDA
September 30, 2020 |  | no more than 5.5 times EBITDA
December 31, 2020 |  | no more than 6.5 times EBITDA
March 31, 2021 |  | no more than 6.25 times EBITDA
June 30, 2021 |  | no more than 4.5 times EBITDA
After the second quarter of 2021, the leverage ratio covenant reverts to no more than 3.5 times EBITDA. During the period that the increased covenant applies, which period may be terminated early by the Company provided that it is in compliance with the historical 3.5 times EBITDA leverage ratio, the amended credit agreement contains certain additional limitations and restrictions including, but not limited to, regarding repurchases of the Company's common stock, the amount of funds that can be used on business acquisitions, the incurrence of secured indebtedness, and, under certain circumstances, the payment of dividends. Interest on the amended senior unsecured revolving credit facility is subject to a pricing schedule that can fluctuate based on changes in the Company's credit ratings and current EBITDA leverage ratio.

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- Definition The entire disclosure for significant events or transactions that occurred after the balance sheet date through the date the financial statements were issued or the date the financial statements were available to be issued. Examples include: the sale of a capital stock issue, purchase of a business, settlement of litigation, catastrophic loss, significant foreign exchange rate changes, loans to insiders or affiliates, and transactions not in the ordinary course of business. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 855 -URI http://asc.fasb.org/topic&trid=2122774 + Details
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