Humana 2015 Annual Report Download - page 78

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We entered into a commercial paper program in October 2014. Net proceeds from the issuance of commercial
paper were $298 million 2015 and the maximum principal amount outstanding at any one time during 2015 was $414
million. There were no net proceeds from the issuance of commercial paper in 2014 and the maximum principal amount
outstanding at any one time during 2014 was $175 million.
In September 2014, we issued $400 million of 2.625% senior notes due October 1, 2019, $600 million of 3.85%
senior notes due October 1, 2024 and $750 million of 4.95% senior notes due October 1, 2044. Our net proceeds,
reduced for the underwriters' discount and commission and offering expenses, were $1.73 billion. We used a portion
of the net proceeds to redeem our $500 million 6.45% senior unsecured notes.
The remainder of the cash used in or provided by financing activities in 2015, 2014, and 2013 primarily resulted
from proceeds from stock option exercises and the change in book overdraft.
Future Sources and Uses of Liquidity
Dividends
The following table provides details of dividend payments, excluding dividend equivalent rights, in 2013, 2014,
and 2015 under our Board approved quarterly cash dividend policy:
Payment
Date
Amount
per Share
Total
Amount
(in millions)
2013 $1.06 $ 167
2014 $1.10 $ 170
2015 $1.14 $ 170
The Merger discussed in Note 2 to the consolidated financial statements included in Item 8. – Financial Statements
and Supplementary Data does not impact our ability and intent to continue quarterly dividend payments prior to the
closing of the Merger consistent with our historical dividend payments. Under the terms of the Merger Agreement, we
have agreed with Aetna that our quarterly dividend will not exceed $0.29 per share prior to the closing of the Merger.
Declaration and payment of future quarterly dividends is at the discretion of our Board and may be adjusted as business
needs or market conditions change. In addition, under the terms of the Merger Agreement, we have agreed with Aetna
to coordinate the declaration and payment of dividends so that our stockholders do not fail to receive a quarterly dividend
around the time of the closing of the Merger.
On October 29, 2015, the Board declared a cash dividend of $0.29 per share that was paid on January 29, 2016 to
stockholders of record on December 30, 2015, for an aggregate amount of $43 million.
Stock Repurchases
In September 2014, our Board of Directors replaced a previous share repurchase authorization of up to $1 billion
(of which $816 million remained unused) with a new current authorization for repurchases of up to $2 billion of our
common shares exclusive of shares repurchased in connection with employee stock plans, expiring on December 31,
2016. Under the share repurchase authorization, shares may be purchased from time to time at prevailing prices in the
open market, by block purchases, through plans designed to comply with Rule 10b5-1 under the Securities Exchange
Act of 1934, as amended, or in privately-negotiated transactions (including pursuant to accelerated share repurchase
agreements with investment banks), subject to certain regulatory restrictions on volume, pricing, and timing. Pursuant
to the Merger Agreement, after July 2, 2015, we are prohibited from repurchasing any of our outstanding securities
without the prior written consent of Aetna, other than repurchases of shares of our common stock in connection with
the exercise of outstanding stock options or the vesting or settlement of outstanding restricted stock awards. Accordingly,
as announced on July 3, 2015, we have suspended our share repurchase program. Our remaining repurchase authorization
was $1.04 billion as of July 3, 2015.