HUMANA INC 8-K

What Happened
Humana Inc. announced on May 19, 2026 (Closing Date May 15, 2026) the issuance and sale of Pre‑Capitalized Trust Securities ("P‑Caps") by two Horseshoe Funding Trusts: $750.0M to Horseshoe Funding Trust I and $750.0M to Horseshoe Funding Trust II (aggregate $1.5B). Each Trust invested proceeds in U.S. Treasury principal and interest strips (Eligible Assets). Humana entered separate Facility Agreements giving it the right to require each Trust to purchase, on demand, up to $750.0M aggregate principal of Humana senior notes: 6.062% Senior Notes due 2036 (2036 Trust; ten‑year issuance period) and 6.887% Senior Notes due 2055 (2055 Trust; thirty‑year issuance period).

Key Details

• Amounts: $750,000,000 P‑Caps issued per Trust; $1.5 billion total.
• Senior note coupons and maturities: 6.062% due Feb 15, 2036; 6.887% due Nov 15, 2055.
• Fees and costs: Humana pays facility fees on unexercised amounts at 1.661% p.a. (2036 Trust) and 1.916% p.a. (2055 Trust), paid semi‑annually; Trusts pledged Eligible Assets to secure obligations.
• Triggers and mechanics: Issuance Rights auto‑exercise on certain payment defaults, bankruptcy events, or other specified triggers; Humana must exercise if consolidated net worth falls below $4.0B or upon certain indenture/change‑of‑control events. P‑Caps are mandatorily redeemable Feb 15, 2036 (2036 Trust) and Nov 15, 2055 (2055 Trust). Change‑of‑control repurchases: P‑Caps repurchased at 101% of initial purchase price; Senior Notes repurchased at 101% of principal plus accrued interest.

Why It Matters
This transaction provides Humana with on‑demand liquidity and a committed financing capacity of up to $1.5B through pre‑funded trusts without immediately issuing the senior notes to the public. If and when Humana exercises an Issuance Right, the related senior notes will become direct debt on Humana’s balance sheet and affect leverage and interest expense (noting the stated coupon rates and facility fees). Investors should note the automatic exercise triggers (including defaults and bankruptcy events) and the covenant restrictions in the indentures that could limit certain company actions. The filing discloses the material agreements and creates a new potential financial obligation that could impact Humana’s credit profile if drawn.