Filed by RightCHOICE Managed Care, Inc.
Pursuant to Rule 425 under the Securities Act of 1933
Subject Company: RightCHOICE Managed Care, Inc.
Commission File No. 333-34750
The following communications contain forward-looking statements within the
meaning of the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. In particular, statements regarding the reorganization of
RightCHOICE Managed Care, Inc., a Missouri corporation, are based on
management's current expectations or beliefs and are subject to a number of
factors and uncertainties that could cause actual results to differ materially
from those described in the forward-looking statements. Careful consideration
should be given to risk factors included in RightCHOICE's reports filed with
the Securities and Exchange Commission, especially the section entitled "Risk
Factors" in "ITEM 1. BUSINESS" of RightCHOICE's Annual Report on Form 10-K for
the year ended December 31, 1999.
For Further Information
Kevin Aandahl 314-923-6268
Deb Wiethop 314-923-4767
RightCHOICE Announces Special Shareholders' Meeting
Progress towards Proposed Settlement Continues
ST. LOUIS, Missouri (October 4, 2000) - RightCHOICE Managed Care, Inc.
(NYSE:RIT) announced today that the Registration Statement on Form S-4 which
relates to the proposed settlement with the State of Missouri and its related
reorganization has been declared effective by the Securities and Exchange
Commission. The Registration Statement contains proxy and prospectus
information regarding the special shareholders' meeting and the settlement
reorganization.
A special shareholders' meeting will be held on Tuesday, November 28, 2000, at
1831 Chestnut St., St. Louis, Mo. 63103. The Company expects to mail a proxy
statement/prospectus in October to all of the shareholders of record as of
October 4, 2000, the record date. If all the conditions to the closing are
completed, including the receipt of shareholder approval, the closing could
occur as soon as November 30, 2000, although the reorganization agreement only
requires that the closing occur by December 31, 2000.
Both RightCHOICE and its parent company, Blue Cross and Blue Shield of Missouri,
reached agreement with Missouri officials to resolve litigation initiated
against the parent company related to its continued ownership of RightCHOICE
after its creation in 1994. The parties to the settlement agreed earlier this
year to use their best efforts to consummate the settlement and the related
reorganization by December 31, 2000.
"We are excited about the reorganization that will result from the settlement
and firmly believe that it's in the best interest of members, RightCHOICE
shareholders and the people of Missouri," said John O'Rourke, chairman,
president and chief executive officer of RightCHOICE and president and chief
executive officer of Blue Cross and Blue Shield of Missouri.
A number of significant conditions must be satisfied before the settlement is
completed; in addition to receipt of approval of the reorganization from the
company's shareholders at the special shareholders' meeting, the parties also
have sought a private letter ruling from the IRS and final approval of the
reorganization from both the Blue Cross and Blue Shield Association and the
Missouri Department of Insurance. The reorganization is also conditioned upon
the receipt of legal opinions from counsel to the various parties.
In addition, there remains pending a case regarding the status of Blue Cross
and Blue Shield of Missouri that could affect the closing of the reorganization.
The case relates to whether Blue Cross and Blue Shield of Missouri is a public
benefit or a mutual benefit company. Actions in that case could have an effect
on the timing of the closing of the reorganization.
Blue Cross and Blue Shield of Missouri and its for-profit subsidiary,
RightCHOICE Managed Care, Inc., are the largest providers of health care
benefits in Missouri in terms of members. After the reorganization, Blue Cross
and Blue Shield of Missouri and RightCHOICE will be combined. The resulting
company will be a fully for-profit company with stock traded on the New York
Stock Exchange. The Missouri Foundation for Health will own about 80 percent
of the common stock although that stock will be subject to a voting trust and
divestiture agreement in order to provide for the orderly disposition of the
stock.
The Foundation has agreed that at least 95 percent of its shares will be voted
as directed by the New RightCHOICE Board of Directors on all matters except
those related to any future change of control of New RightCHOICE.
Caution Concerning Forward-Looking Statements
This press release includes "forward-looking statements" within the meaning of
the Private Securities Litigation Reform Act of 1995. These statements are
based on management's current expectations and are naturally subject to
uncertainty and changes in circumstances. Actual results may vary materially
from the expectations described above. Investors should not view these
forward-looking statements as guarantees of future performance. The risks and
uncertainties that could cause actual results to differ materially are detailed
in the company's filings with the Securities and Exchange Commission, including
its most recent Quarterly Report on Form 10-Q and Annual Report on Form 10-K.
RightCHOICE is not under any obligation, and expressly disclaims any obligation,
to update or alter its forward-looking statements whether as a result of new
information, future events or otherwise.
Important Information about Proposed Reorganization
RightCHOICE Managed Care, Inc., a Delaware corporation, referred to above as
New RightCHOICE, together with RightCHOICE Managed Care, Inc., a Missouri
corporation, referred to above as RightCHOICE or the company, has filed with
the Securities and Exchange Commission a preliminary proxy statement/prospectus
regarding the proposed settlement and reorganization transaction described
above. In addition, New RightCHOICE and RightCHOICE will file with the SEC a
definitive proxy statement/prospectus and other documents regarding the proposed
settlement and reorganization transaction. You are urged to read the definitive
proxy statement/prospectus, when it becomes available, because it will contain
important information. The definitive proxy statement/prospectus will be sent
to shareholders of RightCHOICE seeking their approval of the proposed settlement
and reorganization transaction. You may obtain a free copy of the definitive
proxy statement/prospectus (when it is available) and other documents filed by
New RightCHOICE (as well as by RightCHOICE) with the SEC at the SEC's web site
at www.sec.gov. The definitive proxy statement/prospectus (when it is
available) and these other documents may also be obtained for free by
RightCHOICE shareholders by directing a request to: RightCHOICE Managed Care,
Inc., 1831 Chestnut Street, St. Louis, Missouri, 63103, Attn: Investor
Relations, telephone number (314) 923-4831; e-mail: [email protected] .
RightCHOICE and its respective officers, directors, employees and agents may be
deemed to be participants in the solicitation of proxies from their shareholders
with respect to the reorganization transaction. Information concerning the
participants in the solicitation will be set forth in the definitive proxy
statement/prospectus.
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