Item 1.01. Entry into a Material Definitive Agreement.
On July 1, 2021, Centene Corporation, a Delaware corporation (the "Company"),
completed its previously announced underwritten public offering (the "Offering")
of $1,800,000,000 aggregate principal amount of the Company's 2.450% Senior
Notes due 2028 (the "Notes"). The Company intends to use the net proceeds of the
Offering to finance a portion of the cash consideration payable in connection
with Centene's previously announced acquisition of Magellan Health Inc.
("Magellan Health" and such proposed acquisition, the "Magellan Acquisition")
and to pay related fees and expenses. The closing of the offering is not
conditioned on the closing of the Magellan Acquisition. If the Magellan
Acquisition is not completed, Centene expects to use the net proceeds of the
offering for debt repayment and general corporate purposes.
The Notes are governed by the terms of the Indenture, dated as of October 7,
2020 (the "Base Indenture"), between the Company and The Bank of New York Mellon
Trust Company, N.A., as trustee (the "Trustee"), as supplemented by the Third
Supplemental Indenture, dated as of July 1, 2021 (the "Third Supplemental
Indenture" and, together with the Base Indenture, the "Indenture"), between the
Company and the Trustee.
The Notes will mature on July 15, 2028 and the Company will pay interest on the
Notes semi-annually in arrears on January 15 and July 15, beginning on January
15, 2022. The Notes will be the Company's senior unsecured obligations and rank
equally in right of payment with all of the Company's existing and future senior
indebtedness and will be senior in right of payment to any of the Company's
existing and future subordinated indebtedness. The Notes will be effectively
junior to all existing and future secured indebtedness to the extent of the
value of the assets securing such indebtedness. The Notes will not be guaranteed
by any of the Company's subsidiaries.
The Company may redeem the Notes at any time or from time to time in whole or in
part, prior to May 15, 2028 (two months prior to the maturity date of the Notes)
(the "Par Call Date"), at its option at a redemption price equal to the greater
of: (i) 100% of the principal amount of the Notes being redeemed on that
redemption date, or (ii) the sum of the present values of the remaining
scheduled payments of principal and interest on the Notes being redeemed
(exclusive of interest accrued to, but excluding, the date of redemption) that
would be due if such Notes matured on the Par Call Date, discounted to the date
of redemption on a semi-annual basis (assuming a 360-day year consisting of
twelve 30-day months) at the Treasury Rate (as defined in the Third Supplemental
Indenture) plus 50 basis points, plus, in each case, accrued and unpaid interest
on the Notes being redeemed, if any, to, but excluding, the date of redemption.
The Company may also redeem the Notes at any time or from time to time in whole
or in part, on and after the Par Call Date, at its option at a redemption price
equal to 100% of the principal amount of the Notes being redeemed, plus accrued
and unpaid interest on the Notes being redeemed, if any, to, but excluding, the
date of redemption.
Subject to certain limitations, if the Company experiences specific kinds of
changes of control, it will be required to make an offer to purchase the Notes
at a purchase price equal to 101% of the principal amount of the Notes, plus
accrued and unpaid interest, if any, to, but excluding, the date of repurchase.
The Indenture provides for customary events of default, including failure to
make required payments; failure to comply with certain agreements or covenants;
failure to pay, or acceleration of, certain other material indebtedness; certain
events of bankruptcy and insolvency; and failure to pay certain judgments. An
event of default under the Indenture will allow either the Trustee or the
holders of at least 25% in principal amount of the then outstanding Notes to
accelerate, or in certain cases, will automatically cause the acceleration of,
the amounts due under the Notes.
The Notes were offered and sold pursuant to the Company's automatic shelf
registration statement on Form S-3ASR (Registration No. 333-238050) under the
Securities Act of 1933, as amended, which was filed with the Securities and
Exchange Commission ("SEC") and became effective on May 6, 2020. The Company has
filed with the SEC a prospectus supplement, dated June 24, 2021, together with
the accompanying prospectus, dated May 6, 2020, relating to the offering and
sale of the Notes.
--------------------------------------------------------------------------------
The foregoing description of the Base Indenture, the Third Supplemental
Indenture and the Notes is qualified in its entirety by reference to the full
text of the Base Indenture, which is incorporated herein by reference, and each
of the Third Supplemental Indenture and the form of Note due 2028, each of which
are attached to this Current Report and are incorporated herein by reference on
Form 8-K as Exhibits 4.2 and 4.3, respectively.
Item 2.03. Creation of a Direct Financial Obligation or an Obligation under an
Off-Balance Sheet Arrangement of a Registrant.
The information in Item 1.01 above is incorporated herein by reference.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
No. Description
4.1 Base Indenture, dated as of October 7, 2020, between the Company and The
Bank of New York Mellon Trust Company, N.A., as trustee (incorporated by
reference to Exhibit 4.1 to the Company's Form 8-K, dated October 7,
2020)
4.2 Third Supplemental Indenture, dated as of July 1, 2021, between the
Company and The Bank of New York Mellon Trust Company, N.A., as trustee
4.3 Form of 2.450% Senior Note due 2028 (included in Exhibit 4.2)
5.1 Opinion of Skadden, Arps, Slate, Meagher & Flom LLP
23.1 Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in
Exhibit 5.1)
104 Cover Page Interactive Data File (embedded within the Inline XBRL
document)
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses
CENTENE CORPORATION 
