Express Scripts 2013 Annual Report Download - page 55

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55 Express Scripts 2013 Annual Report
BRIDGE FACILITY
On August 5, 2011, ESI entered into a credit agreement with Credit Suisse AG, Cayman Islands Branch, as
administrative agent, Citibank, N.A., as syndication agent, and the other lenders and agents named within the agreement. The
credit agreement provided for a one-year unsecured $14,000.0 million bridge term loan facility (the “bridge facility”). No
amounts were withdrawn under the bridge facility, and subsequent to consummation of the Merger on April 2, 2012, the bridge
facility was terminated.
See Note 7 - Financing for more information on the bridge facility.
FIVE-YEAR CREDIT FACILITY
On April 30, 2007, Medco entered into a senior unsecured credit agreement, which was available for general
working capital requirements. The facility consisted of an $1,000.0 million, 5-year senior unsecured term loan and a $2,000.0
million, 5-year senior unsecured revolving credit facility. The facility was due to mature on April 30, 2012. Medco refinanced
the $2,000.00 million senior unsecured revolving credit facility on January 23, 2012. Upon completion of the Merger, the
$1,000.0 million senior unsecured term loan and all associated interest, and the $1,000.0 million then outstanding under the
senior unsecured revolving credit facility, were repaid in full and terminated.
See Note 7 - Financing for more information on the five-year credit facility.
ACCOUNTS RECEIVABLE FINANCING FACILITY
Upon consummation of the Merger, Express Scripts assumed a $600.0 million, 364-day renewable accounts
receivable financing facility that was collateralized by Medco’s pharmaceutical manufacturer rebates accounts receivable. On
September 21, 2012, Express Scripts terminated the facility and repaid all amounts drawn down.
See Note 7 - Financing for more information on the accounts receivable financing facility.
INTEREST RATE SWAP
Medco entered into five interest rate swap agreements in 2004. These swap agreements, in effect, converted $200.0
million of Medco’s $500.0 million of 7.250% senior notes due 2013 to variable interest rate debt. Under the terms of these
swap agreements, Medco received a fixed rate of interest of 7.250% on $200.0 million and paid variable interest rates based on
the six-month LIBOR plus a weighted-average spread of 3.050%. The payment dates under the agreements coincided with the
interest payment dates on the hedged debt instruments and the difference between the amounts paid and received was included
in interest expense. These swaps were settled on May 7, 2012. Express Scripts received $10.1 million for settlement of the
swaps and the associated accrued interest receivable through May 7, 2012 and recorded a loss of $1.5 million related to the
carrying amount of the swaps and bank fees.
See Note 7 - Financing for more information on the interest rate swap.