Item 1.01. Entry into a Material Definitive Agreement.
On November 1, 2021, Molina Healthcare, Inc., a Delaware corporation (the
"Company"), entered into a purchase agreement (the "Purchase Agreement"), by and
between the Company and Truist Securities, Inc., acting as representative of the
several initial purchasers named in Schedule A thereto (the "Initial
Purchasers"), relating to the issuance and sale of $750 million aggregate
principal amount of the Company's senior notes due 2032 (the "Notes"), in a
private offering to individuals reasonably believed to be "qualified
institutional buyers" pursuant to Rule 144A under the Securities Act of 1933, as
amended (the "Securities Act"), and to certain persons outside the United States
in reliance on Regulation S under the Securities Act. The offering is expected
to close on or about November 16, 2021, subject to the satisfaction of customary
closing conditions (the "Settlement Date").
The Notes will bear interest at a rate of 3.875% per year. Interest will be
payable semi-annually in arrears on May 15 and November 15 of each year,
commencing May 15, 2022, and will accrue from the Settlement Date. The Notes
will mature on May 15, 2032.
The Company estimates that after deducting fees and expenses payable by the
Company, the net proceeds from the issuance and sale of the Notes will be
approximately $741 million (the "Net Proceeds"). The Company intends to use
approximately $725 million of the Net Proceeds to redeem the entire $700 million
outstanding principal amount of its 5.375% senior notes due 2022. The Company
intends to use the remaining Net Proceeds for general corporate purposes, which
may include repayment of indebtedness, share repurchases, funding for
acquisitions, capital expenditures, additions to working capital and capital
contributions to the Company's health plan subsidiaries to meet statutory
requirements in new or existing states.
The Purchase Agreement contains customary representations, warranties and
agreements by the Company. In addition, the Company has agreed to indemnify the
Initial Purchasers against certain liabilities, as more particularly described
in Section 7(a) of the Purchase Agreement.
The foregoing summary of the Purchase Agreement does not purport to be complete
and is subject to, and qualified in its entirety by, the full text of the
Purchase Agreement. A copy of the form of Purchase Agreement is being filed as
Exhibit 1.1 hereto and is incorporated herein by reference.
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Item 8.01. Other Events.
On November 1, 2021, the Company issued a press release announcing the pricing
of the Notes. A copy of the press release is being filed as Exhibit 99.1 to
this Current Report on Form 8-K.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits:
Exhibit
No. Description
1.1 Form of Purchase Agreement, dated November 1, 2021, by and between the
Company and Truist Securities, Inc., as representative of the several
initial purchasers named in Schedule A thereto
99.1 Press release of Molina Healthcare, Inc. issued November 1, 2021
104 Cover page information from Molina Healthcare, Inc.'s Current Report on
Form 8-K filed on November 2, 2021 formatted in iXBRL (Inline Extensible
Business Reporting Language)
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