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EXHIBIT 4.4
EXECUTION COPY
5-7/8% SENIOR NOTES DUE 2012
REGISTRATION RIGHTS AGREEMENT
DATED AS OF JANUARY 28, 2005
BY AND AMONG
COVENTRY HEALTH CARE, INC.,
AS ISSUER,
AND
LEHMAN BROTHERS INC.,
CIBC WORLD MARKETS CORP.,
ABN AMRO INCORPORATED,
BANC OF AMERICA SECURITIES LLC,
WACHOVIA SECURITIES,
BNP PARIBAS,
BNY CAPITAL MARKETS, INC.
AND
PIPER JAFFRAY & CO.,
AS THE INITIAL PURCHASERS
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This Registration Rights Agreement (this "AGREEMENT") is dated
as of
January 28, 2005, by and among Coventry Health Care, Inc., a
Delaware
corporation (the "COMPANY") and Lehman Brothers Inc., CIBC World
Markets Corp.,
ABN AMRO Incorporated, Banc of America Securities LLC, Wachovia
Securities, BNP
Paribas, BNY Capital Markets, Inc. and Piper Jaffray & Co.
(each an "INITIAL
PURCHASER" and, collectively, the "INITIAL PURCHASERS"), each of
whom has agreed
to purchase the Company's 5-7/8% Senior Notes due 2012 (the
"NOTES") pursuant to
the Purchase Agreement (as defined below).
This Agreement is made pursuant to the Purchase Agreement,
dated
January 21, 2005 (the "PURCHASE AGREEMENT"), by and among the
Company and the
Initial Purchasers. In order to induce the Initial Purchasers to
purchase the
Notes, the Company has agreed to provide the registration rights
set forth in
this Agreement. The execution and delivery of this Agreement is
a condition to
the obligations of the Initial Purchasers set forth in Section 6
of the Purchase
Agreement. Capitalized terms used herein and not otherwise
defined shall have
the meanings assigned to them in the Indenture, dated the date
hereof (the
"INDENTURE"), among the Company and Wachovia Bank, National
Association, as
Trustee (the "TRUSTEE"), relating to the Notes and the Exchange
Notes (as
defined below).
The parties hereby agree as follows:
SECTION 1. DEFINITIONS
As used in this Agreement, the following capitalized terms
shall
have the following meanings:
ACT: The U.S. Securities Act of 1933, as amended.
AFFILIATE: As defined in Rule 144 of the Act.
BROKER-DEALER: Any broker or dealer registered under the
Exchange
Act.
CERTIFICATED SECURITIES: Definitive Notes, as defined in the
Indenture.
CLOSING DATE: The date of this Agreement.
COMMISSION: The U.S. Securities and Exchange Commission.
CONSUMMATE: An Exchange Offer shall be deemed "Consummated"
for
purposes of this Agreement upon the occurrence of (a) the filing
and
effectiveness under the Act of the Exchange Offer Registration
Statement
relating to the Exchange Notes to be issued in the Exchange
Offer, (b) the
maintenance of such Exchange Offer Registration Statement
continuously effective
and the keeping of the Exchange Offer open for a period not less
than the period
required pursuant to Section 3(b) hereof and (c) the delivery by
the Company to
the Registrar under an Indenture of Exchange Notes in the same
aggregate
principal amount as the aggregate principal amount of Notes
tendered by Holders
thereof pursuant to the Exchange Offer.
CONSUMMATION DEADLINE: As defined in Section 3(b) hereof.
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2
EFFECTIVENESS DEADLINE: As defined in Section 3(a) hereof.
EXCHANGE ACT: The U.S. Securities Exchange Act of 1934, as
amended.
EXCHANGE NOTES: The Company's 5-7/8% Senior Notes due 2012,
registered under the Act, to be issued pursuant to the Indenture
(a) in the
Exchange Offer or (b) as contemplated by Section 4 hereof.
EXCHANGE OFFER: The exchange and issuance by the Company of
a
principal amount of Exchange Notes (which shall be registered
pursuant to the
Exchange Offer Registration Statement) equal to the outstanding
principal amount
of Notes that are tendered by such Holders in connection with
such exchange and
issuance.
EXCHANGE OFFER REGISTRATION STATEMENT: The Registration
Statement
relating to the Exchange Offer, including the related
Prospectus.
EXEMPT RESALES: The transactions in which the Initial
Purchasers
propose to sell the Notes to certain "qualified institutional
buyers," as such
term is defined in Rule 144A under the Act, and pursuant to
Regulation S under
the Act.
FILING DEADLINE: As defined in Sections 3(a) and 4(a)
hereof.
HOLDERS: As defined in Section 2 hereof.
INTEREST PAYMENT DATE: As defined in the Notes and the
Exchange
Notes.
PERSON: As defined in the Indenture.
PROSPECTUS: The prospectus included in a Registration Statement
at
the time such Registration Statement is declared effective, as
amended or
supplemented by any prospectus supplement and by all other
amendments thereto,
including post-effective amendments, and all material
incorporated by reference
into such Prospectus.
RECOMMENCEMENT DATE: As defined in Section 6(e) hereof.
REGISTRATION DEFAULT: As defined in Section 5 hereof.
REGISTRATION STATEMENT: Any registration statement of the
Company
relating to (a) an offering of Exchange Notes pursuant to an
Exchange Offer or
(b) the registration for resale of Transfer Restricted
Securities pursuant to
the Shelf Registration Statement, in each case (i) that is filed
pursuant to the
provisions of this Agreement and (ii) including the Prospectus
included therein,
all amendments and supplements thereto (including post-effective
amendments) and
all exhibits and material incorporated by reference therein.
REGULATION S: Regulation S promulgated under the Act.
RULE 144: Rule 144 promulgated under the Act.
SHELF REGISTRATION STATEMENT: As defined in Section 4(a)
hereof.
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SUSPENSION NOTICE: As defined in Section 6(e) hereof.
TIA: The U.S. Trust Indenture Act of 1939 (15 U.S.C. Section
77aaa-77bbbb) as in effect on the date of the Indenture.
TRANSFER RESTRICTED SECURITIES: (a) Each Note, until the
earliest to
occur of (i) the date on which such Note has been exchanged by a
Person other
than a Broker-Dealer for an Exchange Note in the Exchange Offer
and is entitled
to be resold to the public by such Person without complying with
the prospectus
delivery requirements of the Act, (ii) the date on which such
Note has been
effectively registered under the Act and disposed of in
accordance with the
Shelf Registration Statement, or (iii) the date on which such
Note is eligible
to be distributed to the public pursuant to Rule 144 under the
Act, and (b) each
Exchange Note acquired by a Broker-Dealer in the Exchange Offer
of a Note for
such Exchange Note, until the date on which such Exchange Note
is sold to a
purchaser who receives from such Broker-Dealer on or prior to
the date of such
sale a copy of the Prospectus contained in the Exchange Offer
Registration
Statement.
SECTION 2. HOLDERS
A Person is deemed to be a holder of Transfer Restricted
Securities
(each, a "HOLDER") whenever such Person owns Transfer Restricted
Securities.
SECTION 3. REGISTERED EXCHANGE OFFER
(a) Unless the Exchange Offer shall not be permitted by
applicable
federal law (after the procedures set forth in Section 6(a)(i)
below have been
complied with), the Company shall (i) cause the Exchange Offer
Registration
Statement to be filed with the Commission no later than 120 days
after the
Closing Date (such 120th day being the "FILING DEADLINE"), (ii)
use their best
efforts to cause such Exchange Offer Registration Statement to
become effective
no later than 180 days after the Closing Date (such 180th day
being the
"EFFECTIVENESS DEADLINE"), (iii) in connection with the
foregoing, (A) file all
pre-effective amendments to such Exchange Offer Registration
Statement as may be
necessary in order to cause it to become effective, (B) file, if
applicable, a
post-effective amendment to such Exchange Offer Registration
Statement pursuant
to Rule 430A under the Act and (C) cause all necessary filings,
if any, in
connection with the registration and qualification of the
Exchange Notes to be
made under the Blue Sky laws of such jurisdictions as are
necessary to permit
Consummation of the Exchange Offer, and (iv) upon the
effectiveness of such
Exchange Offer Registration Statement, commence and use all
commercially
reasonable efforts to Consummate the Exchange Offer. The
Exchange Offer shall be
on the appropriate form permitting (I) registration of the
Exchange Notes to be
offered in exchange for the Notes that are Transfer Restricted
Securities and
(II) resales of Exchange Notes by Broker-Dealers that tendered
into the Exchange
Offer Notes that such Broker-Dealer acquired for its own account
as a result of
market making activities or other trading activities (other than
Notes acquired
directly from the Company or any its Affiliates) as contemplated
by Section 3(c)
below.
(b) The Company shall use its best efforts to cause the
Exchange
Offer Registration Statement to be effective continuously, and
shall keep the
Exchange Offer open for
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4
a period of not less than (i) 20 business days or more than 45
days or (ii) if
longer, the minimum period required under applicable federal and
state
securities laws to Consummate the Exchange Offer. The Company
shall cause the
Exchange Offer to comply with all applicable federal and state
securities laws.
No securities other than the Exchange Notes shall be included in
the Exchange
Offer Registration Statement. The Company shall use all
commercially reasonable
efforts to cause the Exchange Offer to be Consummated on or
prior to 30 Business
Days after the Exchange Offer Registration Statement has become
effective, but
in no event later than 30 business days thereafter (such 30th
business day being
the "CONSUMMATION DEADLINE").
(c) The Company shall include a "Plan of Distribution" section
in
the Prospectus contained in the Exchange Offer Registration
Statement and
indicate therein that any Broker-Dealer who holds Transfer
Restricted Securities
that were acquired for the account of such Broker-Dealer as a
result of
market-making activities or other trading activities (other than
Notes acquired
directly from the Company or any Affiliate of the Company), may
exchange such
Transfer Restricted Securities pursuant to the Exchange Offer.
Such "Plan of
Distribution" section shall also contain all other information
with respect to
such sales by such Broker-Dealers that the Commission may
require in order to
permit such sales pursuant thereto, but such "Plan of
Distribution" shall not
name any such Broker-Dealer or disclose the amount of Transfer
Restricted
Securities held by any such Broker-Dealer, except to the extent
required by the
Commission as a result of a change in policy, rules or
regulations after the
date of this Agreement.
Because such Broker-Dealer may be deemed to be an
"underwriter"
within the meaning of the Act and must, therefore, deliver a
prospectus meeting
the requirements of the Act in connection with its initial sale
of any Exchange
Notes received by such Broker-Dealer in the Exchange Offer, the
Company shall
permit the use of the Prospectus contained in the Exchange Offer
Registration
Statement by such Broker-Dealer to satisfy such prospectus
delivery requirement.
To the extent necessary to ensure that the prospectus contained
in the Exchange
Offer Registration Statement is available for sales of Exchange
Notes by
Broker-Dealers, the Company agrees to use its best efforts to
keep the Exchange
Offer Registration Statement continuously effective,
supplemented, amended and
current as required by and subject to the provisions of Section
6(a) and (c)
hereof and in conformity with the requirements of this
Agreement, the Act and
the policies, rules and regulations of the Commission as
announced from time to
time, for a period of one year from the date on which the
Exchange Offer is
Consummated or such shorter period as will terminate when all
Transfer
Restricted Securities covered by such Registration Statement
have been sold
pursuant thereto. The Company shall provide sufficient copies of
the latest
version of such Prospectus to such Broker-Dealers, promptly upon
request, and in
no event later than one day after such request, at any time
during such period.
SECTION 4. SHELF REGISTRATION
(a) Shelf Registration. If (i) due to applicable law or
interpretations thereof by the Commission's staff, the Company
determines upon
advice of its outside counsel that it is not permitted to effect
the Exchange
Offer as contemplated by Section 3 hereof (after the Company has
complied with
the procedures set forth in Section 6(a)(i) hereof); (ii) for
any other reason
the Exchange Offer Registration Statement is not declared
effective within 180
days
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5
following the date of the original issuance of the Notes or the
Exchange Offer
is not consummated within 210 days following the date of the
original issuance
of the Notes; (iii) any Initial Purchaser so requests with
respect to Notes that
are not eligible to be exchanged for Exchange Notes in the
Exchange Offer and
that are held by it following consummation of the Exchange
Offer; (iv) any
Holder (other than an Initial Purchaser) of Transfer Restricted
Securities is
not eligible to participate in the Exchange Offer or does not
receive freely
tradeable Exchange Notes in the Exchange Offer other than by
reason of such
Holder being an Affiliate of the Company (it being understood
that the
requirement that a participating Broker-Dealer deliver the
Prospectus contained
in the Exchange Offer Registration Statement in connection with
sales of
Exchange Notes shall not result in such Exchange Notes being not
"freely
tradeable"); or (v) in the case of any Initial Purchaser that
participates in
the Exchange Offer or acquires Exchange Notes from the Company
as a result of
its determination that it is not eligible to participate in the
Exchange Offer
with respect to any unsold Notes, such Initial Purchaser does
not receive freely
tradeable Exchange Notes in exchange for Notes constituting any
portion of an
unsold allotment (it being understood that (x) the requirement
that an Initial
Purchaser deliver a Prospectus containing the information
required by Item 507
or 508 of Regulation S-K under the Act in connection with sales
of Exchange
Notes acquired in exchange for such Notes shall result in such
Exchange Notes
being not "freely tradeable"; and (y) the requirement that a
participating
Broker-Dealer delivers a Prospectus in connection with sales of
Exchange Notes
acquired in the Exchange Offer in exchange for Notes acquired as
a result of
market-making activities or other trading activities shall not
result in such
Exchange Notes being not "freely tradeable"), the Company shall
effect a Shelf
Registration Statement in accordance with subsection (b)
below.
(b) If required pursuant to subsection (a) above,
(I) the Company shall, as promptly as practicable, file with
the Commission and thereafter shall use its best efforts to
cause to be
declared effective under the Act a Shelf Registration Statement
relating
to the offer and sale of the Notes or the Exchange Notes, as
applicable,
by the Holders thereof from time to time in accordance with the
methods of
distribution elected by such Holders and set forth in such
Shelf
Registration Statement; provided, however, that no Holder (other
than an
Initial Purchaser) shall be entitled to have the Notes or
Exchange Notes
held by it covered by such Shelf Registration Statement unless
such Holder
agrees in writing to be bound by all of the provisions of this
Agreement
applicable to such Holder; and provided further, that with
respect to
Exchange Notes received by an Initial Purchaser in exchange for
Notes
constituting any portion of an unsold allotment, the Company
may, if
permitted by current interpretations by the Commission's staff,
file a
post-effective amendment to the Exchange Offer Registration
Statement
containing the information required by Item 507 or 508 of
Regulation S-K,
as applicable, in satisfaction of its obligations under this
subsection
with respect thereto, and any such Exchange Offer Registration
Statement,
as so amended, shall be referred to herein as, and governed by
the
provisions herein applicable to, a Shelf Registration
Statement.
(II) the Company shall use its best efforts to keep the
Shelf
Registration Statement continuously effective, supplemented and
amended as
required by the Act, in order to permit the Prospectus forming
part
thereof to be usable by Holders for a period of two years (as
extended
pursuant to Section 6(c)(i)hereof) from the date the
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Shelf Registration Statement is declared effective by the
Commission or
such shorter period that will terminate when all the Notes or
Exchange
Notes, as applicable, covered by the Shelf Registration
Statement have
been sold pursuant to the Shelf Registration Statement (in any
such case,
such period being called the "SHELF REGISTRATION PERIOD"). The
Company
shall be deemed not to have used its best efforts to keep the
Shelf
Registration Statement effective during the requisite period if
it
voluntarily takes any action that would result in Holders of
Notes or
Exchange Notes covered thereby not being able to offer and sell
such Notes
or Exchange Notes during that period, unless (A) such action is
required
by applicable law; or (B) such action is taken by the Company in
good
faith and for valid business reasons (not including avoidance of
the
Company's obligations hereunder), including the acquisition or
divestiture
of assets, so long as the Company promptly thereafter complies
with the
requirements of Section 5(k) hereof, if applicable; provided,
however,
that in any case if such Registration Default occurs for a
continuous
period in excess of 30 days, Additional Interest shall be
payable in
accordance with Section 5 hereof from the day such Registration
Default
occurs until such Registration Default is cured.
(III) the Company shall cause the Shelf Registration
Statement
and the related Prospectus and any amendment or supplement
thereto, as of
the effective date of the Shelf Registration Statement or such
amendment
or supplement, (A) to comply in all material respects with the
applicable
requirements of the Act and the rules and regulations of the
Commission;
and (B) not to contain any untrue statement of a material fact
or omit to
state a material fact required to be stated therein or necessary
in order
to make the statements therein, in the light of the
circumstances under
which they were made, not misleading.
(c) Provision by Holders of Certain Information in Connection
with
the Shelf Registration Statement. No Holder of Transfer
Restricted Securities
may include any of its Transfer Restricted Securities in any
Shelf Registration
Statement pursuant to this Agreement unless and until such
Holder furnishes to
the Company in writing, within 20 days after receipt of a
request therefor, the
information specified in Item 507 or 508 of Regulation S-K, as
applicable, of
the Act for use in connection with any Shelf Registration
Statement or
Prospectus or preliminary Prospectus included therein. No Holder
of Transfer
Restricted Securities shall be entitled to Additional Interest
pursuant to
Section 5 hereof unless and until such Holder shall have
provided all such
information. By its acceptance of Transfer Restricted
Securities, each Holder
agrees to promptly furnish additional information required to be
disclosed in
order to make the information previously furnished to the
Company by such Holder
not materially misleading.
SECTION 5. ADDITIONAL INTEREST
If (a) on or prior to the 120th day following the original
issue
date of the Notes, neither the Exchange Offer Registration
Statement nor the
Shelf Registration Statement has been filed with the Commission,
(b) on or prior
to the 180th day following the original issue date of the Notes,
neither the
Exchange Offer Registration Statement nor the Shelf Registration
Statement has
been declared effective, (c) on or prior to the 210th day
following the original
issue date of the Notes, neither the Exchange Offer has been
consummated nor the
Shelf
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7
Registration Statement has been declared effective, or (d) after
either the
Exchange Offer Registration Statement or the Shelf Registration
Statement has
been declared effective, except as provided in Section 4(b)(II)
hereof, such
Registration Statement thereafter ceases to be effective or
usable in connection
with resales of Notes or Exchange Notes in accordance with and
during the
periods specified in this Agreement (each such event referred to
in clauses (a)
through (d), a "REGISTRATION DEFAULT"), interest ("ADDITIONAL
INTEREST") will
accrue on the principal amount of the Notes and the Exchange
Notes (in addition
to the stated interest on the Notes and Exchange Notes) from and
including the
date on which any such Registration Default shall occur to but
excluding the
date on which all Registration Defaults have been cured.
Additional Interest
will accrue at a rate of 0.25% per annum during the 90-day
period immediately
following the occurrence of such Registration Default and shall
increase by
0.25% per annum at the end of each subsequent 90-day period, but
in no event
shall such rate exceed 1.00% per annum.
All accrued Additional Interest shall be paid to the Holders
entitled thereto, in the manner provided for the payment of
interest in the
Indenture, on each Interest Payment Date, as more fully set
forth in the
Indenture and the Notes and the Exchange Notes. Notwithstanding
the fact that
any securities for which Additional Interest are due cease to be
Transfer
Restricted Securities, all obligations of the Company to pay
Additional Interest
with respect to securities shall survive until such time as such
obligations
with respect to such securities shall have been satisfied in
full.
SECTION 6. REGISTRATION PROCEDURES
(a) Exchange Offer Registration Statement. In connection with
the
Exchange Offer, the Company shall (i) comply with all applicable
provisions of
Section 6(c) below, (ii) use its best efforts to effect such
exchange and to
permit the resale of Exchange Notes by any Broker-Dealer that
tendered Notes in
the Exchange Offer that such Broker-Dealer acquired for its own
account as a
result of its market making activities or other trading
activities (other than
Notes acquired directly from the Company or any of its
Affiliates) being sold in
accordance with the intended method or methods of distribution
thereof, and
(iii) comply with all of the following provisions:
(A) If, following the date hereof there has been announced a
change
in Commission policy with respect to exchange offers such as the
Exchange
Offer, that in the reasonable opinion of counsel to the Company
raises a
substantial question as to whether the Exchange Offer is
permitted by
applicable federal law, the Company hereby agrees to seek a
no-action
letter or other favorable decision from the Commission allowing
the
Company to Consummate an Exchange Offer for such Transfer
Restricted
Securities. The Company hereby agrees to pursue the issuance of
such a
decision to the Commission staff level. In connection with the
foregoing,
the Company hereby agrees to take all such other actions as may
be
requested by the Commission or otherwise required in connection
with the
issuance of such decision, including without limitation (I)
participating
in telephonic conferences with the Commission staff, (II)
delivering to
the Commission staff an analysis prepared by counsel to the
Company
setting forth the legal bases, if any, upon which such counsel
has
concluded that such an Exchange Offer should be permitted and
(III)
diligently pursuing a resolution (which need not be favorable)
by the
Commission staff.
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(B) As a condition to its participation in the Exchange Offer,
each
Holder of Transfer Restricted Securities (including, without
limitation,
any Holder who is a Broker-Dealer) shall furnish, upon the
request of the
Company, prior to the Consummation of the Exchange Offer, a
written
representation to the Company (which may be contained in the
letter of
transmittal contemplated by the Exchange Offer Registration
Statement) to
the effect that (I) it is not an Affiliate of the Company, (II)
it is not
engaged in, and does not intend to engage in, and has no
arrangement or
understanding with any person to participate in, a distribution
of the
Exchange Notes to be issued in the Exchange Offer and (III) it
is
acquiring the Exchange Notes in its ordinary course of business.
Each
Holder using the Exchange Offer to participate in a distribution
of the
Exchange Notes will be required to acknowledge and agree that,
if the
resales are of Exchange Notes obtained by such Holder in
exchange for
Notes acquired directly from the Company or an Affiliate
thereof, it (1)
could not, under Commission policy as in effect on the date of
this
Agreement, rely on the position of the Commission enunciated in
Morgan
Stanley and Co., Inc. (available June 5, 1991) and Exxon Capital
Holdings
Corporation (available May 13, 1988), as interpreted in the
Commission's
letter to Shearman & Sterling dated July 2, 1993, and
similar no-action
letters (including, if applicable, any no-action letter obtained
pursuant
to clause (A) above), and (2) must comply with the registration
and
prospectus delivery requirements of the Act in connection with a
secondary
resale transaction and that such a secondary resale transaction
must be
covered by an effective Registration Statement containing the
selling
security holder information required by Item 507 or 508, as
applicable, of
Regulation S-K
(C) Prior to effectiveness of the Exchange Offer
Registration
Statement, the Company shall provide a supplemental letter to
the
Commission (I) stating that the Company is registering the
Exchange Offer
in reliance on the position of the Commission enunciated in
Exxon Capital
Holdings Corporation (available May 13, 1988), Morgan Stanley
and Co.,
Inc. (available June 5, 1991) as interpreted in the Commission's
letter to
Shearman & Sterling dated July 2, 1993, and, if applicable,
any no-action
letter obtained pursuant to clause (A) above, (II) including
a
representation that the Company has not entered into any
arrangement or
understanding with any Person to distribute the Exchange Notes
to be
received in the Exchange Offer and that, to the best of the
Company's
information and belief, each Holder participating in the
Exchange Offer is
acquiring the Exchange Notes in its ordinary course of business
and has no
arrangement or understanding with any Person to participate in
the
distribution of the Exchange Notes received in the Exchange
Offer and
(III) any other undertaking or representation required by the
Commission
as set forth in any no-action letter obtained pursuant to clause
(A)
above, if applicable.
(b) Shelf Registration Statement. In connection with the
Shelf
Registration Statement, the Company shall:
(i) comply with all the provisions of Section 6(c) an
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