UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported): October 3, 2001
PACIFICARE HEALTH SYSTEMS, INC.
(Exact name of registrant as specified in its charter)
Delaware (State or other jurisdiction of incorporation or organization) |
000-21949 (Commission File Number) |
95-4591529 (IRS Employer Identification Number) |
3120 Lake Center Drive, Santa Ana, California 92704
(Address of principal executive offices, including zip code)
(Registrants telephone number, including area code): (714) 825-5200
ITEM 5. OTHER EVENTS. | ||||||||
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS. | ||||||||
SIGNATURES | ||||||||
EXHIBIT INDEX | ||||||||
EXHIBIT 99.1 | ||||||||
EXHIBIT 99.2 |
ITEM 5. OTHER EVENTS.
On October 3, 2001, PacifiCare Health Systems, Inc. announced the completion of a debt for equity exchange with a holder of its 7% Senior Notes due 2003. |
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS.
(c) Exhibits. |
99.1 Press release issued October 3, 2001 by the Registrant announcing the completion of a debt for equity exchange with a holder of its 7% Senior Notes due 2003. | |
99.2 Letter Amendment, dated as of August 30, 2001, to the Amended and Restated Credit Agreement, dated as of August 20, 2001, among the Registrant, the Initial Lenders, the Initial Issuing Bank and Swing Line Banks named in the Credit Agreement, as Initial Lenders, Initial Issuing Bank and Swing Line Bank, Bank of America, N.A. in its capacity as Collateral Agent and Administrative Agent, Banc of America Securities LLC and J.P. Morgan Securities Inc. in their capacity as Co-Lead Arrangers, and Banc of America Securities LLC, J.P. Morgan Securities Inc. and Salomon Smith Barney Inc. in their capacity as Joint Book-Running Managers. |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
PACIFICARE HEALTH SYSTEMS, INC. (Registrant) |
|||
| |||
Date: October 4, 2001 | By: | /s/ SUSAN L. BERKEL | |
Susan L. Berkel Senior Vice President of Finance and Corporate Controller (Chief Accounting Officer) |
EXHIBIT INDEX
Exhibit No. | Description of Exhibits | |
99.1 | Press release issued October 3, 2001 by the Registrant announcing the completion of a debt for equity exchange with a holder of its 7% Senior Notes due 2003. | |
99.2 | Letter Amendment, dated as of August 30, 2001, to the Amended and Restated Credit Agreement, dated as of August 20, 2001, among the Registrant, the Initial Lenders, the Initial Issuing Bank and Swing Line Banks named in the Credit Agreement, as Initial Lenders, Initial Issuing Bank and Swing Line Bank, Bank of America, N.A. in its capacity as Collateral Agent and Administrative Agent, Banc of America Securities LLC and J.P. Morgan Securities Inc. in their capacity as Co-Lead Arrangers, and Banc of America Securities LLC, J.P. Morgan Securities Inc. and Salomon Smith Barney Inc. in their capacity as Joint Book-Running Managers. |
EXHIBIT 99.1
3120 W. Lake Center Drive Santa Ana, California 92704 Tel. (714) 825-5200 |
News Release
CONTACT: |
Suzanne C. Shirley Investor Relations (714) 825-5491 |
Ben Singer Media Relations (714) 825-5120 |
FOR IMMEDIATE RELEASE
PACIFICARE HEALTH SYSTEMS COMPLETES DEBT FOR
EQUITY EXCHANGE
SANTA ANA, Calif., October 3, 2001 PacifiCare Health Systems, Inc. (NASDAQ: PHSY) announced today that the company completed a debt for equity exchange with a holder of its 7% Senior Notes due 2003. As a result of the transaction conducted with HBV Rediscovered Opportunities Fund LP, an investment fund operated by New York-based HBV Capital Management, LLC, the company issued approximately 753,000 shares of common stock and retired $12 million in debt. PacifiCare now has approximately 34.5 million shares outstanding.
Dedicated to making peoples lives better, PacifiCare Health Systems is one of the nations largest health care services companies with approximately $12 billion in annual revenues. Primary operations include health insurance products for employer groups and Medicare beneficiaries in eight Western states and Guam. Other specialty products and operations include behavioral health services, life and health insurance, dental and vision services and pharmacy benefit management. More information on PacifiCare Health Systems can be obtained at www.pacificare.com.
# # #
EXHIBIT 99.2
LETTER AMENDMENT
Dated as of August 30, 2001
To the banks, financial institutions and other institutional lenders (collectively, the Lender Parties) parties to the Credit Agreement referred to below and to Bank of America, N.A., as administrative agent (the Administrative Agent) for the Lender Parties |
Ladies and Gentlemen:
We refer to the Amended and Restated Credit Agreement dated as of August 20, 2001 among PacifiCare Health Systems, Inc., a Delaware corporation, formerly known as N-T Holdings, Inc. (the Borrower), the Subsidiary Guarantors parties thereto (together with the Borrower, the Loan Parties), the banks, financial institutions and other institutional lenders listed on the signature pages thereof as the Initial Lenders (the Initial Lenders), the bank listed on the signature pages thereof as the Initial Issuing Bank (the Initial Issuing Bank and, together with the Initial Lenders, the Initial Lender Parties) and the Swing Line Bank referred to therein, Banc of America Securities LLC (Banc of America Securities) and J.P. Morgan Securities Inc. as co-lead arrangers (the Co-Lead Arrangers), Banc of America Securities, J.P. Morgan Securities Inc. and Salomon Smith Barney Inc. as joint book-running managers (the Joint Book-Running Managers), Bank of America, N.A. (Bank of America), as collateral agent (together with any successor collateral agent appointed pursuant to Article VII thereto, the Collateral Agent), and Bank of America, as administrative agent (together with any successor administrative agent appointed pursuant to Article VII thereto, the Administrative Agent and, together with the Collateral Agent, the Agents) for the Lender Parties thereto (such Amended and Restated Credit Agreement, as amended hereby and as otherwise amended, amended and restated, supplemented or modified from time to time, the Credit Agreement). Capitalized terms not otherwise defined in this Letter Amendment have the meanings specified in the Credit Agreement.
We hereby request that you agree to amend Section 5.02(k) to the Credit Agreement in its entirety to read as follows:
"(k) Prepayments, Etc., of Debt. Prepay, redeem, purchase, defease or otherwise satisfy prior to the scheduled maturity thereof in any manner, or make |
1
any payment in violation of any subordination terms of, any Debt, except (i) the prepayment of the Advances in accordance with the terms of this Agreement, (ii) regularly scheduled or required repayments or redemptions of Debt permitted under Section 5.02(b) and (iii) any exchange of the 7% Senior Notes for common Equity Interests of the Borrower, or amend, modify or change in any manner any term or condition of any Surviving Debt or the 7% Senior Notes, other than any amendment, modification or change which could not be reasonably likely to have a Material Adverse Effect, or permit any of its Subsidiaries to do any of the foregoing other than to prepay any Debt payable to the Borrower. |
The provisions of this Letter Amendment shall become effective as of the date first above written, provided, however, that the Administrative Agent shall have first received (i) counterparts of this Letter Amendment executed by the Borrower and the Required Lenders and (ii) counterparts of the Consent to this Letter Amendment executed by each Subsidiary Guarantor.
The Borrower hereby confirms that on and as of the date hereof and after giving effect to the terms of this Letter Amendment (i) the representations and warranties contained in the Loan Documents are correct in all material respects (other than any such representations and warranties, that, by their terms, refer to a specific date), and (ii) no event has occurred and is continuing which constitutes a Default.
The Credit Agreement and each of the other Loan Documents, except to the extent they are modified by the amendment specifically set forth above, are and shall continue to be in full force and effect and are hereby in all respects ratified and confirmed. Without limiting the generality of the foregoing, the Loan Documents and all of the Collateral described therein do and shall continue to secure the payment of all Obligations of the Loan Parties under the Loan Documents. The execution, delivery and effectiveness of this Letter Amendment shall not, except as expressly provided herein, operate as a waiver of any right, power or remedy of any Lender Party or the Administrative Agent under the Credit Agreement or any other Loan Document, nor constitute a waiver of any provision of the Credit Agreement or any other Loan Document.
If you agree to the terms and provisions of this Letter Amendment, please evidence such agreement by executing and returning at least two counterparts first via facsimile then by mail to Laurie Kolpinski at Shearman & Sterling, 599 Lexington Avenue, New York, NY 10022, facsimile (212) 893-0425.
This Letter Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed shall be deemed to be an original and all of which taken together shall constitute one and the same agreement. Delivery of an executed counterpart of a signature page to this Letter Amendment by telecopier shall be effective as delivery of a manually executed counterpart of this Letter Amendment.
2
This Letter Amendment shall be governed by, and construed in accordance with, the laws of the State of New York.
Very truly yours, |
PACIFICARE HEALTH SYSTEMS, INC., as Borrower |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | VP Treasurer |
BANK OF AMERICA, N.A., as Administrative Agent, Collateral Agent and as Initial Lender |
||
| ||
By | /s/ Joseph L. Corah | |
Title: | Principal |
Initial Lenders
AIB INTERNATIONAL FINANCE | ||
| ||
By | /s/ Ronan G. ONeill | |
Title: | Director |
THE BANK OF NEW YORK | ||
| ||
By | /s/ Rebecca K. Levine | |
Title: | Vice President |
THE BANK OF NOVA SCOTIA | ||
| ||
By | /s/ R. P. Reynolds | |
Title: | Director |
BANK ONE NA | ||
| ||
By | /s/ Dennis Warren | |
Title: | First Vice President |
BNP PARIBAS | ||
| ||
By | /s/ Duane P. Helkow | |
Title: | Director | |
| ||
By | /s/ Shayn P. March | |
Title: | Vice President |
THE CHASE MANHATTAN BANK | ||
| ||
By | /s/ Dawn Lee Lum | |
Title: | Vice President |
CIBC INC. | ||
| ||
By | /s/ Terence Moore | |
Title: | Executive Director |
CITIBANK DELAWARE | ||
| ||
By | /s/ Dennis Bermack | |
Title: | Vice President |
CITIBANK, N.A. | ||
| ||
By | /s/ Dennis Bermack | |
Title: | Vice President |
CREDIT LYONNAIS | ||
| ||
By | /s/ C. Heidsieck | |
Title: | Senior Vice President |
CREDIT SUISSE FIRST BOSTON | ||
| ||
By | /s/ William S. Lutkins | |
Title: | Vice President | |
| ||
By | /s/ David M. Koczan | |
Title: | Assistant Vice President |
THE DAI-ICHI KANGYO BANK, LTD. | ||
| ||
By | /s/ JOHN SNEED | |
Title: | Senior Vice President |
THE INDUSTRIAL BANK OF JAPAN, LIMITED | ||
| ||
By | /s/ V. Timiraos | |
Title: | Joint General Manager |
INTESABCI-NEW YORK BRANCH | ||
| ||
By | /s/ Frank Maffei | |
Title: | Vice President | |
| ||
By | /s/ J. Dickerhof | |
Title: | Vice President |
MORGAN GUARANTY TRUST COMPANY | ||
| ||
By | /s/ William Ingrassia | |
Title: | Vice President |
SOCIETE GENERALE | ||
| ||
By | /s/ Richard Bernal | |
Title: | Director |
SUMITOMO MITSUI BANKING CORP. | ||
| ||
By | /s/ Al Galluzzo | |
Title: | Senior Vice President |
SUNTRUST BANK | ||
| ||
By | /s/ William D. Priester | |
Title: | Vice President |
UNION BANK OF CALIFORNIA, N.A. | ||
| ||
By | /s/ Bette McCole | |
Title: |
WELLS FARGO BANK, NATIONAL ASSOCIATION | ||
| ||
By | /s/ Lucy Nixon | |
Title: | Vice President |
CONSENT
Dated as of August 30, 2001
Each of the undersigned, as Subsidiary Guarantors under the Credit Agreement dated as of August 20, 2001 (the Credit Agreement) in favor of the Lender Parties to the Credit Agreement referred to in the foregoing Letter Amendment dated as of the date hereof, hereby consent to the said Letter Amendment and hereby confirm and agree that the Subsidiary Guaranty is, and shall continue to be, in full force and effect and is hereby ratified and confirmed in all respects except that, upon the effectiveness of, and on and after the date of, the said Letter Amendment, each reference in the Credit Agreement to the Loan Documents or any thereof, thereunder, thereof or words of like import shall mean and be a reference to the Loan Documents or such Loan Document as amended by the said Letter Amendment.
[Signature pages follow]
IN WITNESS WHEREOF, each Subsidiary Guarantor has caused this Consent to be duly executed and delivered by its officer thereunto duly authorized as of the date first above written.
PACIFICARE HEALTH PLAN ADMINISTRATORS, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
PACIFICARE eHOLDINGS, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
SENIORCO, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
RxCONNECT ACQUISITION CORPORATION, as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
Rx SOLUTIONS, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
S-1
PACIFICARE BEHAVIORAL HEALTH, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Assistant Treasurer |
SECUREHORIZONS USA, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
PACIFICARE VENTURES, INC., as Subsidiary Guarantor |
||
| ||
By | /s/ Coy F. Baugh | |
Title: | Treasurer |
S-2