Bright Health Group Secures Financing to Support Operations Pending the Expected Close of California Medicare Advantage Business Sale

Bright Health Group, Inc., the value-driven, technology-driven healthcare company, today announced that it has entered into a credit facility with an investment partnership of New Enterprise Associates ( “NEA ) with a credit facility of $60 million on August 4, 2023 Bright Health also announced that it has entered into a permanent default waiver of its existing credit facility, which will Expires February 2024.

“We are excited to have the continued support of NEA, and all of our partners, as we continue to transform our business into one of the leading value-driven healthcare companies.”

Mike Mikan, President and CEO of Bright Health.

The financing is expected to cover the company’s working capital needs pending the closing of the sale of California Medicare Advantage Business to Molina Healthcare, Inc.As part of the new credit facility, Bright Health also announced that it will issue coin warrants to purchase up to 1,656,789 shares of the company’s common stock from lenders under the new credit facility. This. The issue of warrants generally requires shareholder approval, but the Bright Health Board of Directors’ Audit Committee has determined that deferring debt financing (including the issuance of subscription warrants) ) until approved by the shareholders will jeopardize the financial viability of the company.Accordingly, the Audit Subcommittee approved that the Company did not receive the approval of shareholders. Bright Health expects to formally notify shareholders as soon as practicable after this date that it intends to issue coin warrants relating to the financing of loans under the new credit facility. without their consent. The New York Stock Exchange (“NYSE”) has approved the Company’s use of the exception provided in section 312.05 of the NYSE Handbook for Listed Companies.Bright Health is expected to report its second-quarter 2023 results on August 9, and will provide details on quarterly and annual performance through that date.Moelis & Company LLC acted as financial advisor to Bright Health and Simpson Thacher & Bartlett LLP acted as legal counsel to Bright Health in the process.
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