Item 1.01 Entry into a Material Definitive Agreement.
On September 23, 2022, GoHealth, Inc. (Nasdaq: GOCO) (the "Company" or
"GoHealth") entered into an Investment Agreement which is filed as Exhibit 10.1
to this Current Report on Form 8-K (the "Investment Agreement") with Anthem
Insurance Companies, Inc. and GH 22 Holdings, Inc. (the "Purchasers"), relating
to the issuance and sale by the Company to the Purchasers of 50,000 shares of
the Company's Series A Convertible Perpetual Preferred Stock, par value $0.0001
per share (the "Preferred Stock"), for an aggregate purchase price of
$50.0 million, at $1,000 per share of Preferred Stock (the "Issuance").
Affiliates of the Purchasers are significant customers of the Company. The
closing of the Issuance occurred on September 23, 2022 (the "Closing Date").
The Preferred Stock ranks senior to the shares of the Company's Class A Common
Stock, par value $0.0001 per share (the "Class A Common Stock"), and the
Company's Class B Common Stock, par value $0.0001 per share (the "Class B Common
Stock" and, together with the Class A Common Stock, the "Common Stock"), with
respect to dividend rights and rights on the distribution of assets on any
voluntary or involuntary liquidation, dissolution or winding up of the affairs
of the Company. The Preferred Stock has an initial liquidation preference of
$1,000 per share, which shall increase by accumulated quarterly dividends that
are not paid in cash ("compounded dividends"). Holders of the Preferred Stock
are entitled to a dividend at the rate of 7.0% per annum, accruing daily and
payable quarterly in arrears, as set forth in the certificate of designations
designating the Preferred Stock, which is filed as Exhibit 3.1 to this Current
Report on Form 8-K (the "Certificate of Designations"). Dividends are payable in
cash, by increasing the amount of liquidation preference (compounded dividends)
with respect to a share of Preferred Stock, or any combination thereof, at the
sole discretion of the Company.
The Preferred Stock is convertible in full at the option of the holders into the
number of shares of Class A Common Stock equal to the quotient of (a) the sum of
(x) the liquidation preference (reflecting increases for compounded dividends)
plus (y) the accrued dividends with respect to each share of Preferred Stock as
of the applicable conversion date divided by (b) the conversion price (initially
$0.64) as of the applicable conversion date. Notwithstanding the foregoing, a
holder of Preferred Stock may elect to receive upon conversion, in lieu of the
shares of Class A Common Stock otherwise deliverable, one share of a newly
created class of preferred stock (the "Series A-1 Preferred Stock") for every
1,000 shares of Class A Common Stock otherwise deliverable upon conversion. The
Series A-1 Preferred Stock will be essentially a substitute for the Class A
Common Stock in the form of non-voting preferred stock and have the terms set
forth in the certificate of designations designating the Series A-1 Preferred
Stock (the "Series A-1 Certificate of Designations"), which is filed as Exhibit
3.2 to this Current Report on Form 8-K. The terms of the Preferred Stock and
Series A-1 Preferred Stock contain certain anti-dilution adjustments. Subject to
certain conditions, at any time after the third anniversary of the Closing Date,
if the volume weighted average price per share of Class A Common Stock on Nasdaq
is equal to or greater than 150% of the then-applicable conversion price for
each of at least twenty (20) trading days, whether or not consecutive, in any
period of thirty (30) consecutive trading days ending on and including the
trading day immediately before the Company provides the holders with notice of
its election to convert all or a portion of the Preferred Stock into the
relevant number of shares of Class A Common Stock or Series A-1 Preferred Stock
(at the election of the holder), the Company may elect to convert all or a
portion of the Preferred Stock into the relevant number of shares of Class A
Common Stock or Series A-1 Preferred Stock.
In the event of any voluntary or involuntary liquidation, dissolution or winding
up of the affairs of the Company, the holders of shares of Series A-1 Preferred
Stock (if issued upon conversion of the Preferred Stock) will be entitled, out
of assets legally available therefor, and subject to the rights of the holders
of any senior stock (including the Preferred Stock) or parity stock (including
the Common Stock) and the rights of the Company's existing and future creditors,
to receive an aggregate amount per share equal to 1,000 (as may be adjusted)
times the aggregate amount to be distributed per share to holders of shares of
Class A Common Stock. Each holder of a whole share of Series A-1 Preferred Stock
(if issued upon conversion of the Preferred Stock) shall be entitled to receive
. . .
Item 3.02. Unregistered Sales of Equity Securities.
The information contained in Item 1.01 is incorporated herein by reference.
As described in Item 1.01, pursuant to the terms of the Investment Agreement,
the Company has issued shares of the Preferred Stock to the Purchasers. This
issuance and sale are exempt from registration under the Securities Act of 1933,
as amended (the "Securities Act"), pursuant to Section 4(a)(2) of the Securities
Act. The Purchasers have each
3
--------------------------------------------------------------------------------
represented to the Company that it is an "accredited investor" as defined in
Rule 501 of the Securities Act and that the Preferred Stock is being acquired
for its own account and not with a view to, or for sale in connection with, any
distribution thereof, and appropriate legends will be affixed to any
certificates evidencing shares of the Preferred Stock or shares of the Class A
Common Stock or Series A-1 Preferred Stock issued in connection with any future
conversion of the Preferred Stock.
Item 5.03 Amendments to Articles of Incorporation or Bylaws.
On September 23, 2022, the Company filed with the Secretary of State of the
State of Delaware (i) the Certificate of Designations designating the Preferred
Stock and (ii) the Series A-1 Certificate of Designations designating the Series
A-1 Preferred Stock, in each case establishing the powers, designations,
preferences and relative, participating, optional or other special rights, and
the qualifications, limitations and restrictions of the shares of Preferred
Stock and Series A-1 Preferred Stock. Each of the Certificate of Designations
and Series A-1 Certificate of Designations became effective upon filing.
The information in Item 1.01 is incorporated herein by reference.
Item 7.01. Other Events.
On September 26, 2022, the Company issued a press release announcing the closing
of the Issuance. A copy of the press release is furnished herewith as Exhibit
99.1 to this Current Report on Form 8-K.
The information furnished under Item 7.01 of this Current Report on Form 8-K,
including the press release furnished herewith as Exhibit 99.1, shall be deemed
"furnished" and not "filed" for purposes of Section 18 of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to
the liabilities of that Section, and shall not be incorporated by reference in
any filing under the Securities Act or the Exchange Act, except as shall be
expressly set forth by specific reference in such filing.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit
No. Description
3.1 Certificate of Designations of Series A Convertible Perpetual
Preferred Stock of GoHealth, Inc.
3.2 Certificate of Designations of Series A-1 Convertible Non-Voting
Perpetual Preferred Stock of GoHealth, Inc.
10.1 Investment Agreement dated as of September 23, 2022 among GoHealth,
Inc. and the purchasers identified therein.
10.2 Registration Rights Agreement dated as of September 23, 2022 among
GoHealth, Inc. and the persons identified therein.
10.3 Amendment No. 2 to the Second Amended and Restated Limited Liability
Company Agreement of GoHealth Holdings, LLC, dated as of September 23,
2022
99.1 Press Release dated September 26, 2022
104 Cover Page Interactive Data File (the cover page XBRL tags are
embedded within the Inline XBRL document).
4
--------------------------------------------------------------------------------
© Edgar Online, source Glimpses