8-KMaterial AgreementsFinancial Events

CENTENE CORP 8-K Report, Material Agreement (Sep 16, 2004)

Filed September 16, 2004For Securities:CNC

Summary

Centene Corporation (CNC) filed an 8-K on September 16, 2004, reporting the execution of a new five-year, $100,000,000 revolving credit agreement with various financial institutions, led by LaSalle Bank National Association as administrative agent. This new facility, effective September 14, 2004, replaces their previous $50,000,000 line of credit with LaSalle Bank, which was terminated on the same date. The new agreement provides increased borrowing capacity and flexibility, with interest rates tied to LIBOR, the Federal Funds Rate, or the Prime Rate, initially set at LIBOR plus 1%.

Key Highlights

  • 1Centene Corporation entered into a new $100,000,000 revolving credit agreement on September 14, 2004, significantly increasing its borrowing capacity.
  • 2The new credit facility has a five-year term, expiring on September 14, 2009.
  • 3Interest rates are variable, based on LIBOR, Federal Funds Rate, or Prime Rate, initially set at LIBOR plus 1%.
  • 4The agreement is secured by the common stock and membership interests of Centene's subsidiaries.
  • 5Financial covenants are included, such as minimum fixed charge coverage ratios, debt-to-EBITDA ratios, and tangible net worth requirements.
  • 6The new credit agreement replaced a prior $50,000,000 revolving line of credit with LaSalle Bank National Association.
  • 7As of the filing date (September 16, 2004), no funds had been drawn under the new credit facility.

Frequently Asked Questions

The primary purpose is to report the entry into a new, larger revolving credit agreement and the termination of a previous, smaller one. This indicates a strategic move to enhance the company's financial flexibility and borrowing capacity.

The new facility is a $100,000,000 revolving credit agreement, which is double the size of the previous $50,000,000 line of credit that was terminated. This suggests Centene is preparing for potential growth or increased operational needs.

The agreement has a five-year term, secured by subsidiary assets, and includes financial covenants like minimum fixed charge coverage, debt-to-EBITDA, and tangible net worth. Interest rates are variable, initially set at LIBOR plus 1%.

No, as of September 16, 2004, the filing date, Centene had not drawn any funds under the new $100,000,000 revolving credit agreement.