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Item 1.01
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Entry into a Material Definitive Agreement.
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On October 10, 2019, Cigna
Corporation, a Delaware corporation (“Cigna”), issued a press release announcing the early results of its previously
announced (1) offers to Eligible Holders (as defined below) to exchange (the “Exchange Offers”) any and all of certain
outstanding notes (collectively, the “Existing Notes”) issued by Cigna’s wholly-owned subsidiaries: Cigna Holding
Company, a Delaware corporation (“CHC”), Express Scripts Holding Company (“ESHC”), a Delaware corporation,
and Medco Health Solutions, Inc., a Delaware corporation (“Medco” and, together with CHC and ESHC, the “Subsidiary
Issuers”), for (i) new senior notes to be issued by Cigna (collectively, the “New Cigna Notes”) and (ii) cash,
and (2) solicitations of Eligible Holders of each series of Existing Notes to consent to certain proposed amendments to the indentures
governing such Existing Notes (the “Consent Solicitations”).
On October 11, 2019,
Cigna accepted for exchange the Existing Notes that were validly tendered prior to the early tender date and not withdrawn
and consummated the exchange of such Existing Notes by issuing New Cigna Notes to exchanging holders. In connection with the
early settlement of the Exchange Offers and the issuance of the New Cigna Notes, Cigna entered into that certain Supplemental
Indenture No. 3 (the “Supplemental Indenture No. 3”), dated as of October 11, 2019, with CHC and ESHC, each as
guarantors, and U.S. Bank National Association, as trustee, which such Supplemental Indenture No. 3 supplements the
Indenture, dated as of September 17, 2018, among Cigna, CHC and ESHC, each as guarantors, and U.S. Bank National Association,
as trustee.
The New Cigna Notes were
not registered under the Securities Act of 1933, as amended (the “Securities Act”), or the securities laws of any other
jurisdiction. The New Cigna Notes were offered only to persons who certified that they are either (1) “Qualified Institutional
Buyers,” as such term is defined in Rule 144A under the Securities Act, or (2) persons that are outside the United States
and that are (i) not “U.S. persons,” as such terms are defined in Rule 902 under the Securities Act and (ii) “non-U.S.
qualified offerees” (such persons, “Eligible Holders”).
Supplemental Indenture No. 3
Pursuant to the Supplemental Indenture No.
3, on October 11, 2019, Cigna issued the following series of New Cigna Notes:
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1.
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$214,833,000
aggregate principal amount of its 4.500% 2021 Notes, which will mature on March 15, 2021. Cigna will pay interest on its 4.500%
2021 Notes on March 15 and September 15 of each year, commencing on March 15, 2020.
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2.
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$544,728,000
aggregate principal amount of its 4.00% 2022 Notes, which will mature on February 15, 2022. Cigna will pay interest on its 4.00%
2022 Notes on February 15 and August 15 of each year, commencing on February 15, 2020.
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3.
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$3,077,000
aggregate principal amount of its 8.30% 2023 Notes, which will mature on January 15, 2023. Cigna will pay interest on its 8.30%
2023 Notes on January 15 and July 15 of each year, commencing on January 15, 2020.
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4.
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$40,289,000
aggregate principal amount of its 7.65% 2023 Notes, which will mature on March 1, 2023. Cigna will pay interest on its 7.65% 2023
Notes on March 1 and September 1 of each year, commencing on March 1, 2020.
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5.
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$756,761,000
aggregate principal amount of its 3.250% 2025 Notes, which will mature on April 15, 2025. Cigna will pay interest on its 3.250%
2025 Notes on April 15 and October 15 of each year, commencing on, October 15, 2019.
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6.
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$178,804,000
aggregate principal amount of its 7.875% 2027 Notes, which will mature on May 15, 2027. Cigna will pay interest on its 7.875%
2027 Notes on May 15 and November 15 of each year, commencing on November 15, 2019.
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7.
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$547,120,000
aggregate principal amount of its 3.050% Notes, which will mature on October 15, 2027. Cigna will pay interest on its 3.050% 2027
Notes on April 15 and October 15 of each year, commencing on October 15, 2019.
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8.
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$31,882,000
aggregate principal amount of its 8.30% Step-Down Notes, which will mature on January 15, 2033. Cigna will pay interest on its
8.30% 2033 Step-Down Notes on January 15 and July 15 of each year, commencing on January 15, 2020. The interest rate on Cigna’s
8.30% 2033 Step-Down Notes will step-down from 8.30% per annum to 8.08% per annum on and from January 15, 2023.
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9.
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$175,076,000
aggregate principal amount of its 6.150% 2036 Notes, which will mature on November 15, 2036. Cigna will pay interest on its 6.150%
2036 Notes on May 15 and November 15 of each year, commencing on November 15, 2019.
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10.
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$91,102,000
aggregate principal amount of its 5.875% 2041 Notes, which will mature on March 15, 2041. Cigna will pay interest on its
5.875% 2041 Notes on March 15 and September 15 of each year, commencing on March 15, 2020.
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11.
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$295,860,000
aggregate principal amount of its 5.375% 2042 Notes, which will mature on February 15, 2042. Cigna will pay interest on its 5.375%
2042 Notes on February 15 and August 15 of each year, commencing on February 15, 2020.
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12.
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$964,658,000
aggregate principal amount of its 3.875% 2047 Notes, which will mature on October 15, 2047. Cigna will pay interest on its 3.875%
2047 Notes on April 15 and October 15 of each year, commencing on October 15, 2019.
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13.
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$386,240,000
aggregate principal amount of its 3.300% 2021 Notes, which will mature on February 25, 2021. Cigna will pay interest on its 3.300%
2021 Notes on February 25 and August 25 of each year, commencing on February 25, 2020.
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14.
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$909,504,000
aggregate principal amount of its 4.750% 2021
Notes, which will mature on November 15, 2021. Cigna will pay interest on its 4.750% 2021 Notes on May 15 and November 15 of each
year, commencing on November 15, 2019.
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15.
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$771,699,000
aggregate principal amount of its 3.900% 2022 Notes, which will mature on February 15, 2022. Cigna will pay interest on its 3.900%
2022 Notes on February 15 and August 15 of each year, commencing on February 15, 2020.
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16.
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$424,807,000
aggregate principal amount of its 3.050% 2022 Notes, which will mature on November 30, 2022. Cigna will pay interest on its 3.050%
2022 Notes on May 30 and November 30 of each year, commencing on November 30, 2019.
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17.
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$849,224,000
aggregate principal amount of its 3.000% 2023
Notes, which will mature on July 15, 2023. Cigna will pay interest on its 3.000% 2023 Notes on January 15 and July 15 of each
year, commencing on January 15, 2020.
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18.
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$713,257,000
aggregate principal amount of its 3.50% 2024 Notes, which will mature on June 15, 2024. Cigna will pay interest on its 3.50% 2024
Notes on June 15 and December 15 of each year, commencing on December 15, 2019.
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19.
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$1,232,326,000
aggregate principal amount of its 4.500% 2026 Notes, which will mature on February 25, 2026. Cigna will pay interest on its 4.500%
2026 Notes on February 25 and August 25 of each year, commencing on February 25, 2020.
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20.
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$1,318,547,000
aggregate principal amount of its 3.400% 2027 Notes, which will mature on March 1, 2027. Cigna will pay interest on its 3.400%
2027 Notes on March 1 and September 1 of each year, commencing on March 1, 2020.
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21.
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$417,008,000
aggregate principal amount of its 6.125% 2041 Notes, which will mature on November 15, 2041. Cigna will pay interest on its
6.125% 2041 Notes on May 15 and November 15 of each year, commencing on November 15, 2019.
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22.
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$1,405,394,000
aggregate principal amount of its 4.800% 2046 Notes, which will mature on July 15, 2046. Cigna will pay interest on the New Cigna
4.800% 2046 Notes on January 15 and July 15 of each year, commencing on January 15, 2020.
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23.
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$348,886,000
aggregate principal amount of its 4.125% 2020 Notes, which will mature on September 15, 2020. Cigna will pay interest on its 4.125%
2020 Notes on March 15 and September 15 of each year, commencing on March 15, 2020.
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The
foregoing description of the Supplemental Indenture No. 3 does not purport to be complete and is qualified in its entirety
by reference to the Supplemental Indenture No. 3, which is filed as Exhibit 4.1 to this Current Report on Form 8-K,
and incorporated herein by reference as though fully set forth herein.
Registration
Rights Agreement
In
connection with the issuance of the New Cigna Notes, on October 11, 2019, Cigna entered into a Registration Rights Agreement
(the “Registration Rights Agreement”), together with CHC and ESHC, each as guarantors, and J.P. Morgan Securities LLC,
Deutsche Bank Securities Inc. and Wells Fargo Securities, LLC, each as dealer managers (collectively, the “Dealer Managers”).
Pursuant to the Registration Rights Agreement, Cigna has agreed to, for the benefit of the
holders of each series of New Cigna Notes, use its commercially reasonable efforts to (1) file a registration statement on an appropriate
registration form with respect to a registered offer to exchange the New Cigna Notes for new notes (the “Registered Exchange
Offer”), with terms substantially identical in all material respects to the New Cigna Notes (except that the new notes will
not contain terms with respect to transfer restrictions or any increase in annual interest rate), (2) cause the registration statement
to become effective under the Securities Act and (3) complete the Registered Exchange Offer by October 11, 2020.
If
the Registered Exchange Offer is not completed on or before October 11, 2020, or, upon receipt of a written request from any Dealer
Manager representing that it holds New Cigna Notes that are ineligible to be exchanged in the Registered Exchange Offer, Cigna
will use its commercially reasonable efforts to file and to cause to become effective a shelf registration statement relating to
resales of the New Cigna Notes.
If
a “Registration Default” (as such term is defined in the Registration Rights Agreement) occurs with respect to the
New Cigna Notes of a particular series, the annual interest rate on such series of New Cigna Notes will increase by 0.25% for the
first 90-day period beginning on the day immediately following the Registration Default. The annual interest rate on the New Cigna
Notes will increase by an additional 0.25% for each subsequent 90-day period during which the Registration Default continues, up
to a maximum additional interest rate of 1.00% per year. If the Registration Default is corrected, the applicable interest rate
on the applicable series of New Cigna Notes will revert to the original level.
The
foregoing description of the Registration Rights Agreement does not purport to be complete and is qualified in its entirety by
reference to the Registration Rights Agreement, which is filed as Exhibit 4.2 to this Current Report on Form 8-K, and incorporated
herein by reference as though fully set forth herein.
Amendments
to Certain of the Indentures Governing the Existing Notes
In
connection with the receipt of the requisite consents in the Consent Solicitations, on October 11, 2019, each of the Subsidiary
Issuers entered into supplemental indentures to the indentures governing each series of
Existing
Notes (other than the existing 8.30% Notes due 2023 and the existing 7.65% Notes due 2023, each issued by CHC) issued by
them, as applicable, to effect the amendments described in Cigna’s Offering Memorandum and Consent Solicitation
Statement, dated as of September 26, 2019.
CHC
entered into (1) that certain Supplemental Indenture No. 12, dated as of October 11, 2019 (the “Supplemental
Indenture No. 12”), with Cigna, as parent guarantor, and U.S. Bank, National Association, as trustee, which such
Supplemental Indenture No. 12 supplements the Indenture, dated as of August 16, 2006, by, among others, CHC and U.S. Bank
National Association, as trustee and (2) that certain Supplemental Indenture No. 2,
dated as of October 11, 2019 (the “Supplemental Indenture No. 2”), with Cigna, as parent guarantor, and HSBC
Bank USA, National Association, as trustee, which such Supplemental Indenture No. 2 supplements the Indenture, dated as of
January 1, 1994, by, among others, CHC and HSBC Bank USA, National Association, as trustee, in each case to eliminate
certain of the covenants, restrictive provisions, reporting requirements, events of default and related provisions contained
in the applicable indenture.
ESHC
entered into that certain Twenty-Sixth Supplemental Indenture, dated as of October 11, 2019 (“Twenty-Sixth Supplemental
Indenture”), with Cigna, as parent guarantor, and Wells Fargo Bank, National Association, as trustee, which such
Twenty-Sixth Supplemental Indenture supplements the Indenture, dated as of November 21, 2011, by, among others, ESHC
and Wells Fargo Bank, National Association, as trustee, to eliminate certain of the covenants, restrictive
provisions, reporting requirements, events of default and related provisions contained therein.
Medco
entered into that certain Seventh Supplemental Indenture, dated as of October 11, 2019 (“Seventh Supplemental
Indenture”), with Cigna, as parent guarantor, and U.S. Bank Trust National Association, as trustee, which such
Seventh Supplemental Indenture supplements the Indenture, dated as of March 18, 2008, by, among others, Medco and U.S. Bank
Trust National Association, as trustee, to eliminate certain of the covenants, restrictive provisions, reporting
requirements, events of default and related provisions contained therein.
The
foregoing descriptions of Supplemental Indenture No. 12, Supplemental Indenture No. 2, the Twenty-Sixth
Supplemental Indenture and the Seventh Supplemental Indenture do not purport to be complete and are qualified in their
entirety by reference to Supplemental Indenture No. 12, Supplemental Indenture No. 2, the Twenty-Sixth Supplemental
Indenture and the Seventh Supplemental Indenture, which are filed as Exhibits 4.3, 4.4, 4.5 and 4.6, respectively, to this
Current Report on Form 8-K, each of which is incorporated herein by reference as though fully set forth herein.