Item 1.01. Entry into a Material Definitive Agreement.
3.875% Senior Notes due 2032
On November 16, 2021 (the "Settlement Date"), Molina Healthcare, Inc., a
Delaware corporation (the "Company"), completed the private offering of $750.0
million aggregate principal amount of the Company's 3.875% Senior Notes due 2032
(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
Interest and Maturity
The Notes bear interest at the rate of 3.875% per year. Interest on the Notes is
payable semi-annually in arrears on May 15 and November 15 of each year,
commencing May 15, 2022. Interest accrues from the Settlement Date. The Notes
will mature on May 15, 2032.
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.
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.
The Notes are redeemable on and after February 15, 2032 at par plus accrued and
unpaid interest, if any, to, but not including, the redemption date. In
addition, the Company may redeem some or all of the Notes prior to February 15,
2032 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).
The Indenture governing the Notes limits the Company's and its consolidated
subsidiaries' ability to, among other things:
•create certain liens;
•enter into sale and leaseback transactions (except as provided in the
•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
•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.
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.
Exhibit No. Description
4.1 Indenture, dated as of November 16, 2021, by and between Molina Healthcare,
Inc. and U.S. Bank National Association, as Trustee.
4.2 Form of Notes (included in Exhibit 4.1).
99.1 Press release of Molina Healthcare, Inc, issued November 16, 2021.
104 Cover page information from Molina Healthcare, Inc.'s Current Report on Form
8-K filed on November 16, 2021 formatted in iXBRL (Inline Extensible Business
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