Washington, D.C. 20549
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:
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or
Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Item 1.01. Entry into a Material Definitive Agreement.
4.375% Senior Notes due 2028
On June 2, 2020 (the “Settlement Date”), Molina Healthcare, Inc., a Delaware corporation (the “Company”), completed
the private offering of $800.0 million aggregate principal amount of the Company’s 4.375% Senior Notes due 2028 (the “Notes”) pursuant to an indenture, dated as of the Settlement Date, by and between the Company and U.S. Bank National Association,
as trustee, in the form attached as Exhibit 4.1 to this Current Report on Form 8-K (the “Indenture”).
The following is a brief description of the terms of the Notes and the Indenture.
Interest and Maturity
The Notes bear interest at the rate of 4.375% per year. Interest on the Notes is payable
semi-annually in arrears on June 15 and December 15 of each year, commencing December 15, 2020. Interest accrues from the Settlement Date. The Notes will mature on June 15, 2028.
Ranking
The Notes are senior unsecured obligations of the Company and rank pari passu in right of payment with all existing and future senior debt and senior to all existing and future subordinated debt of the Company. The Notes are effectively subordinated to all
existing and future secured debt of the Company to the extent of the value of the assets securing such debt. In addition, the Notes are structurally subordinated to all indebtedness and other liabilities, including trade payables, of the Company’s
subsidiaries.
Future Guarantors
Each of the Company’s subsidiaries that guarantees any of the Company’s indebtedness under its credit
agreement in the future will be required to guarantee the Notes on a pari passu basis. The Notes will not initially be guaranteed by any of the Company’s subsidiaries.
Optional Redemption
The Notes are redeemable on and after June 15, 2023 at the redemption prices specified in the Indenture plus accrued
and unpaid interest, if any, to, but not including, the redemption date. In addition, the Company may redeem up to 40% of the Notes prior to June 15, 2023 with the net cash proceeds of certain equity offerings at the redemption price specified in
the Indenture plus accrued and unpaid interest, if any, to, but not including, the redemption date. The Company may also redeem some or all of the Notes prior to June 15, 2023 at a redemption price equal to 100% of the principal amount of the Notes
redeemed plus accrued and unpaid interest, if any, to, but not including, the redemption date, plus an applicable “make-whole premium”.
Repurchase
at the Option of the Holders upon a Change of Control
Upon the occurrence of a Change of Control (as defined in the Indenture), unless the Company has exercised its right
to redeem all of the Notes as described under “—Optional Redemption” above, each holder of the Notes will have the right to require the Company to repurchase all or any part of such holder’s notes at a purchase price calculated as provided in the
Indenture plus accrued and unpaid interest, to, but not including, the repurchase date (subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date).
Covenants
The Indenture governing the Notes limits the Company’s and its consolidated subsidiaries’ ability to, among other
things:
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enter into sale and leaseback transactions (except as provided in the Indenture);
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issue, assume or guarantee indebtedness for money borrowed that is secured by a lien on certain of the Company’s principal property (or on any shares of capital
stock of the Company’s subsidiaries that own such principal property) without securing the notes on a pari passu basis; and
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consolidate with or merge with or into, or sell, transfer, convey or lease all or substantially all of the Company’s or its subsidiaries’ properties and assets,
taken as a whole, to another person.
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No Registration Rights
The Company will not be required to, nor does it intend to, register the Notes for resale under the Securities Act
of 1933, as amended, or the securities laws of any other jurisdiction.
Events of Default
The Indenture provides for customary events of default, including cross acceleration to certain other indebtedness
of the Company.
The foregoing description of the Indenture and the Notes does not purport to be complete and is qualified in its
entirety by reference to the Indenture and the form of Notes filed as Exhibits 4.1, and 4.2, respectively, to this Current Report on Form 8-K and incorporated herein by reference.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an Off‑Balance Sheet Arrangement of a
Registrant.
The information set forth in Item 1.01 of this Current Report on Form 8-K with respect to the Notes and the
Indenture is incorporated herein by reference into this Item 2.03.
Item 8.01. Other Events.
On the Settlement Date, the Company issued a press release announcing the closing of the offering of the Notes. The
full text of the press release is attached as Exhibit 99.1.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits:
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Exhibit No.
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Description
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104
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Cover page information from Molina Healthcare, Inc.’s Current Report on Form 8-K filed on June 2, 2020
formatted in iXBRL (Inline Extensible Business Reporting Language).
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