THE EXCHANGE OFFER
General
We are offering to exchange a like principal amount of exchange notes for any or all outstanding notes on the terms and subject to the
conditions set forth in this prospectus and accompanying letter of transmittal. We refer to the offer as the "exchange offer." You may tender some or all of your outstanding notes pursuant to the
exchange offer.
As
of the date of this prospectus, $500,000,000 aggregate principal amount of 5.375% Senior Notes due 2024 is outstanding. This prospectus, together with the letter of transmittal, is
first being sent to all registered holders of outstanding notes known to us on or about May 8, 2017. Our obligation to accept outstanding notes for exchange pursuant to the exchange offer is
subject to the satisfaction or waiver of certain conditions set forth under "Conditions to the Exchange Offer" below. We anticipate that each of the conditions will be satisfied and that
no waivers will be necessary.
Purpose and Effect of the Exchange Offer
In connection with the private offering and sale of the outstanding notes, we and the guarantors of the notes entered into the Registration
Rights Agreement with the initial purchasers of the outstanding notes in which we agreed, under certain circumstances, to file a registration statement relating to an offer to exchange the
outstanding notes for exchange notes. The following description of the Registration Rights Agreement is only a brief summary of the agreement. It does not purport to be complete and is qualified in
its entirety by reference to all of the terms, conditions and provisions of the Registration Rights Agreement. For further information, please refer to the Registration Rights Agreement attached as an
exhibit to our Current Report on Form 8-K filed with the SEC on May 26, 2016. We also agreed to use all commercially reasonable efforts to cause the exchange offer to be consummated on
the earliest practicable date after the exchange offer registration statement has become effective but in no event later than the 395
th
day following the issuance date of the
outstanding notes. The form and terms of the exchange notes will be identical in all material respects to the form and terms of the outstanding notes, except that the exchange notes will be registered
under the Securities Act, and will not contain terms with respect to transfer restrictions, registration rights and additional payments upon a failure to fulfill certain of our obligations under the
Registration Rights Agreement. $500,000,000 aggregate principal amount of the outstanding notes were issued on May 26, 2016.
Pursuant
to the Registration Rights Agreement and under the circumstances set forth below, we and the guarantors of the notes will use commercially reasonable efforts to cause the SEC to
declare effective a shelf registration statement with respect to the resale of the outstanding notes within the time periods specified in the Registration Rights Agreement and to keep the shelf
registration statement effective for up to two years after the effective date of the shelf registration statement. These circumstances include:
-
-
if we determine that this exchange offer is not permitted because it would violate any applicable law or applicable interpretations of the
staff of the SEC; or
-
-
if for any other reason the exchange offer is not consummated within 395 days after the issuance date of the outstanding notes; or
-
-
any holder notifies the Company prior to the 20th business day following the consummation of the exchange offer that:
-
(A)
-
the
holder is prohibited by law or SEC policy from participating in the exchange offer
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-
(B)
-
the
holder may not resell the exchange notes acquired by it in the exchange offer to the public without delivering a prospectus and the prospectus contained in the
exchange offer registration statement is not appropriate or available for such resales by such holder; or
-
(C)
-
such
holder is an initial purchaser and holds exchange notes acquired directly from the Company and any if its affiliates.
If
we fail to comply with specified obligations under the Registration Rights Agreement, we will be required to pay special interest to holders of the outstanding notes. These
obligations include:
-
-
the obligation to consummate the exchange offer within 395 days after the issuance date of the outstanding notes;
-
-
the obligation to cause a shelf registration statement, if required, to be filed within the applicable timeframes required by the Registration
Rights Agreement;
-
-
the obligation to cause a shelf registration statement, if required, to be declared effective within the applicable timeframes required by the
Registration Rights Agreement; and
-
-
the obligation to keep the exchange offer registration statement or the shelf registration statement, as the case may be, effective and usable
for its intended purpose, during the periods specified in the Registration Rights Agreement.
If
you wish to exchange your outstanding notes for exchange notes in the exchange offer, you will be required to make the following written
representations:
-
-
you are not our "affiliate" or an "affiliate" of any guarantor of the notes;
-
-
you are not engaged in, and do not intend to engage in, a distribution of the exchange notes; and
-
-
you will acquire the exchange notes in the ordinary course of your business.
Each
broker-dealer that receives exchange notes for its own account in exchange for outstanding notes, where the broker-dealer acquired the outstanding notes as a result of market-making
activities or other trading activities, must acknowledge that it will deliver a prospectus, as required by law, in connection with any resale of such exchange notes. See "Plan of Distribution."
Resale of Exchange Notes
Based on interpretations by the SEC set forth in no-action letters issued to third parties, we believe that you may resell or otherwise transfer
exchange notes issued in the exchange offer without complying with the registration and prospectus delivery provisions of the Securities Act, if:
-
-
you are acquiring the exchange notes in the ordinary course of your business;
-
-
you do not have an arrangement or understanding with any person to participate in a distribution of the exchange notes;
-
-
you are not our "affiliate" or an "affiliate" of any guarantor of the notes as defined by Rule 405 of the Securities Act; and
-
-
you are not engaged in, and do not intend to engage in, a distribution of the exchange notes.
If
you are our "affiliate," or are engaging in, or intend to engage in, or have any arrangement or understanding with any person to participate in, a distribution of the exchange notes,
or are not acquiring the exchange notes in the ordinary course of your business, then:
-
-
you cannot rely on the position of the SEC set forth in Morgan Stanley & Co. Incorporated (available June 5, 1991) and
Exxon Capital Holdings Corporation (available May 13, 1988), as
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interpreted
in the SEC's letter to Shearman & Sterling, dated July 2, 1993, or similar no- action letters; and
-
-
in the absence of an exception from the position stated immediately above, you must comply with the registration and prospectus delivery
requirements of the Securities Act in connection with any resale of the exchange notes.
This
prospectus may be used for an offer to resell, or for the resale or other transfer of exchange notes only as specifically set forth in this prospectus. With regard to
broker-dealers, only broker-dealers that acquired the outstanding notes as a result of market-making activities or other trading activities may participate in the exchange offer. Each broker-dealer
that receives exchange notes for its own account in exchange for outstanding notes where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other
trading activities must acknowledge that it will deliver a prospectus in connection with any resale of the exchange notes. Please read "Plan of Distribution" for more details regarding the transfer of
exchange notes.
Terms of the Exchange Offer
On the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal, we will accept for
exchange in the exchange offer any outstanding notes that are validly tendered and not validly withdrawn prior to the expiration date. Outstanding notes may only be tendered in denominations of $2,000
and integral multiples of $1,000 in excess of $2,000;
provided
, that the untendered portion of any outstanding note must be in a minimum denomination of
$2,000. We will issue $2,000 principal amount or an integral multiple of $1,000 of exchange notes in exchange for a corresponding principal amount of outstanding notes surrendered in the exchange
offer. In exchange for each outstanding note surrendered in the exchange offer, we will issue exchange notes with a like principal amount.
The
form and terms of the exchange notes will be identical in all material respects to the form and terms of the outstanding notes, except that the exchange notes will be registered
under the Securities Act and will not contain terms with respect to transfer restrictions, registration rights and additional payments upon a failure to fulfill certain of our obligations under the
Registration Rights Agreement. The exchange notes will be issued under and entitled to the benefits of the indenture that authorized the issuance of the outstanding notes. For a description of the
indenture, see "
Description of the Exchange Notes
."
The
exchange offer is not conditioned upon any minimum aggregate principal amount of outstanding notes being tendered for exchange.
As
of the date of this prospectus, $500,000,000 aggregate principal amount of the 5.375% Senior Notes due 2024 is outstanding. This prospectus and the letter of transmittal is being sent
to all registered holders of outstanding notes. There will be no fixed record date for determining registered holders of outstanding notes entitled to participate in the exchange offer.
We
intend to conduct the exchange offer in accordance with the provisions of the Registration Rights Agreement, the applicable requirements of the Securities Act and the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations of the SEC.
Outstanding
notes that are not tendered for exchange in the exchange offer will remain outstanding and continue to accrue interest and will be entitled to the rights and benefits that
such holders have under the indenture relating to such holders' outstanding notes and the Registration Rights Agreement, except we will not have any further obligations to provide for the registration
of the outstanding notes under the Registration Rights Agreement.
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We
will be deemed to have accepted for exchange properly tendered outstanding notes when we have given written notice of the acceptance to the exchange agent. The exchange agent will act
as agent for the tendering holders for the purposes of receiving the exchange notes from us and delivering exchange notes to holders. Subject to the terms of the Registration Rights Agreement, we
expressly reserve the right to amend or terminate the exchange offer and to refuse to accept outstanding notes for exchange upon the occurrence of any of the conditions specified below under
"Conditions to the Exchange Offer."
If
you tender your outstanding notes in the exchange offer, you will not be required to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal,
transfer taxes with respect to the exchange of outstanding notes. We will pay all charges and expenses, other than certain applicable taxes described below, in connection with the exchange offer. It
is important that you read "Fees and Expenses" below for more details regarding fees and expenses incurred in the exchange offer.
Expiration Date, Extensions and Amendments
As used in this prospectus, the term "expiration date" means 5:00 p.m., New York City time, on June 6, 2017. However, if we, in
our sole discretion, extend the period of time for which the exchange offer is open, the term "expiration date" will mean the latest time and date to which we shall have extended the expiration of
such exchange offer.
To
extend the period of time during which an exchange offer is open, we will notify the exchange agent of any extension by written notice, followed by notification by press release or
other public announcement to the registered holders of the outstanding notes no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration
date.
We
reserve the right, in our sole discretion:
-
-
to delay accepting for exchange any outstanding notes (only in the case that we amend or extend the exchange offer);
-
-
to extend the exchange offer or to terminate the exchange offer if any of the conditions set forth below under "Conditions to the
Exchange Offer" have not been satisfied by giving written notice of such delay, extension or termination to the exchange agent; and
-
-
subject to the terms of the Registration Rights Agreement, to amend the terms of the exchange offer in any manner. In the event of a material
change in the exchange offer, including the waiver of a material condition, we will extend the offer period, if necessary, so that at least five business days remain in such offer period following
notice of the material change.
Any
delay in acceptance, extension, termination or amendment will be followed as promptly as practicable by written notice to the registered holders of the outstanding notes. If we amend
an exchange offer in a manner that we determine to constitute a material change, we will promptly disclose the amendment in a manner reasonably calculated to inform the holders of applicable
outstanding notes of that amendment.
Conditions to the Exchange Offer
Despite any other term of the exchange offer, we will not be required to accept for exchange, or to issue exchange notes in exchange for, any
outstanding notes, and we may terminate or amend the exchange offer as provided in this prospectus prior to the expiration date if in our reasonable
judgment:
-
-
the exchange offer, or the making of any exchange by a holder, violates any applicable law or interpretation of the SEC;
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-
-
any action or proceeding has been instituted or threatened in writing in any court or by or before any governmental agency with respect to the
exchange offer that, in our judgment, would reasonably be expected to impair our ability to proceed with the exchange offer.
In
addition, we will not be obligated to accept for exchange the outstanding notes of any holder that has not made to us:
-
-
the representations described under "
Purpose and Effect of the Exchange Offer
" and
"
Procedures for Tendering Outstanding Notes
" and "
Plan of Distribution
;" and
-
-
any other representations as may be reasonably necessary under applicable SEC rules, regulations, or interpretations to make available to us an
appropriate form for registration of the exchange notes under the Securities Act.
We
expressly reserve the right at any time or at various times to extend the period of time during which the exchange offer is open. Consequently, we may delay acceptance of any
outstanding notes by giving oral or written notice of such extension to their holders. We will return any outstanding notes that we do not accept for exchange for any reason without expense to their
tendering holder promptly after the expiration or termination of the exchange offer.
We
expressly reserve the right to amend or terminate the exchange offer and to reject for exchange any outstanding notes not previously accepted for exchange upon the occurrence of any
of the conditions of the exchange offer specified above. We will give oral or written notice of any extension, amendment, non-acceptance or termination to the holders of the outstanding notes as
promptly as practicable. In
the case of any extension, such notice will be issued no later than 9:00 a.m., New York City time, on the next business day after the previously scheduled expiration date.
These
conditions are for our sole benefit, and we may assert them regardless of the circumstances that may give rise to them or waive them in whole or in part at any or at various times
prior to the expiration date in our sole discretion. If we fail at any time to exercise any of the foregoing rights, this failure will not constitute a waiver of such right. Each such right will be
deemed an ongoing right that we may assert at any time or at various times prior to the expiration date.
In
addition, we will not accept for exchange any outstanding notes tendered, and will not issue exchange notes in exchange for any such outstanding notes, if at such time any stop order
is threatened or in effect with respect to the registration statement of which this prospectus constitutes a part or the qualification of the indenture under the Trust Indenture Act of 1939, as
amended.
Procedures for Tendering Outstanding Notes
To tender your outstanding notes in the exchange offer, you must comply with either of the following:
-
-
complete, sign and date the letter of transmittal or a facsimile of the letter of transmittal, have the signature(s) on the letter of
transmittal guaranteed if required by the letter of transmittal and mail or deliver such letter of transmittal or facsimile thereof to the exchange agent at the address set forth below under
"
Exchange AgentNotes
" prior to the expiration date; or
-
-
comply with DTC' s Automated Tender Offer Program procedures described below.
In
addition, you will comply with either of the following conditions:
-
-
the exchange agent must receive certificates for outstanding notes along with the letter of transmittal prior to the expiration date; or
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-
the exchange agent must receive a timely confirmation of book-entry transfer of outstanding notes into the exchange agent's account at DTC
according to the procedures for book-entry
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Your
tender, if not withdrawn prior to the expiration date, constitutes an agreement between us and you upon the terms and subject to the conditions described in this prospectus and in
the letter of transmittal.
The
method of delivery of outstanding notes, letters of transmittal and all other required documents to the exchange agent is at your election and risk. We recommend that instead of
delivery by mail, you use an overnight or hand delivery service, properly insured. In all cases, you should allow sufficient time to assure timely delivery to the exchange agent before the expiration
date. You should not send letters of transmittal or certificates representing outstanding notes to us. You may request that your broker, dealer, commercial bank, trust company or nominee effect the
above transactions for you.
If
you are a beneficial owner whose outstanding notes are held in the name of a broker, dealer, commercial bank, trust company, or other nominee and you wish to tender your outstanding
notes, you should promptly instruct the registered holder to tender outstanding notes on your behalf. If you wish to tender the outstanding notes yourself, you must, prior to completing and executing
the letter of transmittal and delivering your outstanding notes, either:
-
-
make appropriate arrangements to register ownership of the outstanding notes in your name; or
-
-
obtain a properly completed bond power from the registered holder of outstanding notes.
The
transfer of registered ownership may take considerable time and may not be able to be completed prior to the expiration date.
Signatures
on the letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed by a member firm of a registered national securities exchange or of the
Financial Industry Regulatory Authority, a commercial bank or trust company having an office or correspondent in the United States or another "eligible guarantor institution" within the meaning of
Rule 17A(d)-15 under the Exchange Act unless the outstanding notes surrendered for exchange are tendered:
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-
by a registered holder of the outstanding notes who has not completed the box entitled "Special Registration Instructions" or "Special Delivery
Instructions" on the letter of transmittal; or
-
-
for the account of an eligible guarantor institution.
If
the letter of transmittal is signed by a person other than the registered holder of any outstanding notes listed on the outstanding notes, such outstanding notes must be endorsed or
accompanied by a properly completed bond power. The bond power must be signed by the registered holder as the registered holder's name appears on the outstanding notes and an eligible guarantor
institution must guarantee the signature on the bond power.
If
the letter of transmittal or any certificates representing outstanding notes or bond powers are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers
of corporations, or others acting in a fiduciary or representative capacity, those persons should also indicate when signing and, unless waived by us, they should also submit evidence satisfactory to
us of their authority to so act.
The
exchange agent and DTC have confirmed that any financial institution that is a participant in DTC's system may use DTC's Automated Tender Offer Program to tender. Participants in the
program may, instead of physically completing and signing the letter of transmittal and delivering it to the exchange agent, electronically transmit their acceptance of the exchange by causing DTC to
transfer the outstanding notes to the exchange agent in accordance with DTC's Automated Tender Offer Program procedures for transfer. DTC will then send an agent's message to the exchange agent. The
term
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"agent's
message" means a message transmitted by DTC, received by the exchange agent and forming part of the book-entry confirmation, which states that:
-
-
DTC has received an express acknowledgment from a participant in its Automated Tender Offer Program that is tendering outstanding notes that
are the subject of the book-entry confirmation;
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-
the participant has received and agrees to be bound by the terms of the letter of transmittal; and
-
-
we may enforce that agreement against such participant.
DTC
is referred to herein as a "book-entry transfer facility."
Acceptance of Exchange Notes
In all cases, we will promptly issue exchange notes for outstanding notes that we have accepted for exchange under the exchange offer only after
the exchange agent timely receives:
-
-
outstanding notes or a timely book-entry confirmation of such outstanding notes into the exchange agent's account at the book-entry transfer
facility; and
-
-
a properly completed and duly executed letter of transmittal and all other required documents or a properly transmitted agent's message.
By
tendering outstanding notes pursuant to the exchange offer, you will represent to us that, among other things:
-
-
you are not our "affiliate" or an "affiliate" of any guarantor of the notes within the meaning of Rule 405 under the Securities Act;
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-
you do not have an arrangement or understanding with any person or entity to participate in a distribution of the exchange notes; and
-
-
you are acquiring the exchange notes in the ordinary course of your business.
In
addition, each broker-dealer that is to receive exchange notes for its own account in exchange for outstanding notes must represent that such outstanding notes were acquired by that
broker-dealer as a result of market-making activities or other trading activities and must acknowledge that it will deliver a prospectus that meets the requirements of the Securities Act in connection
with any resale of the exchange notes. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter"
within the meaning of the Securities Act. See "Plan of Distribution."
Our
interpretation of the terms and conditions of the exchange offer, including the letters of transmittal and the instructions to the letters of transmittal, and our resolution of all
questions as to the validity, form, eligibility, including time of receipt, and acceptance of outstanding notes tendered for exchange will be final and binding on all parties. We reserve the absolute
right to reject any and all tenders of any particular outstanding notes not properly tendered or to not accept any particular outstanding notes if the acceptance might, in our or our counsel's
judgment, be unlawful. We also reserve the absolute right to waive any defects or irregularities as to any particular outstanding notes prior to the expiration date.
Unless
waived, any defects or irregularities in connection with tenders of outstanding notes for exchange must be cured within such reasonable period of time as we determine. Neither we,
the exchange agent, nor any other person will be under any duty to give notification of any defect or irregularity with respect to any tender of outstanding notes for exchange, nor will we or any of
them incur any liability for any failure to give notification. Any outstanding notes received by the exchange agent that are not properly tendered and as to which the irregularities have not been
cured or waived
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will
be returned by the exchange agent to the tendering holder, unless otherwise provided in the letter of transmittal, promptly after the expiration date.
Book-Entry Delivery Procedures
Promptly after the date of this prospectus, the exchange agent will establish an account with respect to the outstanding notes at DTC, as the
book-entry transfer facility, for purposes of the exchange offer. Any financial institution that is a participant in the book-entry transfer facility's system may make book-entry delivery of the
outstanding notes by causing the book-entry transfer facility to transfer those outstanding notes into the exchange agent's account at the facility in
accordance with the facility's procedures for such transfer. To be timely, book-entry delivery of outstanding notes requires receipt of a confirmation of a book-entry transfer, a "book-entry
confirmation," prior to the expiration date. In addition, although delivery of outstanding notes may be effected through book-entry transfer into the exchange agent's account at the book-entry
transfer facility, the letter of transmittal or a manually signed facsimile thereof, together with any required signature guarantees and any other required documents, or an "agent's message," as
defined below, in connection with a book-entry transfer, must, in any case, be delivered or transmitted to and received by the exchange agent at its address set forth on the cover page of the letter
of transmittal prior to the expiration date to receive exchange notes for tendered outstanding notes. Tender will not be deemed made until such documents are received by the exchange agent. Delivery
of documents to the book-entry transfer facility does not constitute delivery to the exchange agent.
Other Matters
New exchange notes will be issued in exchange for outstanding notes accepted for exchange only after timely receipt by the exchange agent
of:
-
-
certificates for (or a timely book-entry confirmation with respect to) your outstanding notes;
-
-
a properly completed and duly executed letter of transmittal or facsimile thereof with any required signature guarantees, or, in the case of a
book-entry transfer, an agent's message; and
-
-
any other documents required by the letter of transmittal.
We
will determine, in our sole discretion, all questions as to the form of all documents, validity, eligibility, including time of receipt, and acceptance of all tenders of outstanding
notes. There will be no guaranteed delivery procedures for the offer. Our determination will be final and binding on all parties.
Alternative, conditional or contingent tenders
of outstanding notes will not be considered valid. We reserve the absolute right to reject any or all tenders of outstanding notes that are not in proper
form or the acceptance of which, in our opinion, would be unlawful. We also reserve the right to waive any defects, irregularities or conditions of tender as to particular outstanding
notes.
Our
interpretation of the terms and conditions of the exchange offer, including the instructions in the accompanying letter of transmittal, will be final and binding.
Any
defect or irregularity in connection with tenders of outstanding notes must be cured within the time we determine, unless waived by us. We will not consider the tender of outstanding
to have been validly made until all defects and irregularities have been waived by us or cured. Neither we, the exchange agent nor any other person will be under any duty to give notice of any defects
or irregularities in tenders of outstanding notes, or will incur any liability to holders for failure to give any such notice.
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Withdrawal Rights
Except as otherwise provided in this prospectus, you may withdraw your tender of outstanding notes at any time prior to 5:00 p.m., New
York City time, on the expiration date. For a withdrawal to be effective:
-
-
the exchange agent must receive a written notice, which may be by telegram, telex, facsimile or letter, of withdrawal at its address set forth
below under "Exchange Agent;" or
-
-
you must comply with the appropriate procedures of DTC's Automated Tender Offer Program system.
Any
notice of withdrawal must:
-
-
specify the name of the person who tendered the outstanding notes to be withdrawn;
-
-
identify the outstanding notes to be withdrawn, including the certificate numbers and principal amount of the outstanding notes; and
-
-
where certificates for outstanding notes have been transmitted, specify the name in which such outstanding notes were registered, if different
from that of the withdrawing holder.
If
certificates for outstanding notes have been delivered or otherwise identified to the exchange agent, then, prior to the release of such certificates, you must also
submit:
-
-
the serial numbers of the particular certificates to be withdrawn; and
-
-
a signed notice of withdrawal with signatures guaranteed by an eligible guarantor institution unless you are an eligible guarantor institution.
If
outstanding notes have been tendered pursuant to the procedures for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at
the book-entry transfer facility to be credited with the withdrawn outstanding notes and otherwise comply with the procedures of the facility. We will determine all questions as to the validity, form,
and eligibility, including time of receipt of notices of withdrawal and our determination will be final and binding on all parties. Any outstanding notes so withdrawn will be deemed not to have been
validly tendered for
exchange for purposes of the exchange offer. Any outstanding notes that have been tendered for exchange but that are not exchanged for any reason will be returned to their holder, without cost to the
holder, or, in the case of book-entry transfer, the outstanding notes will be credited to an account at the book-entry transfer facility, promptly after withdrawal, rejection of tender or termination
of the exchange offer. Properly withdrawn outstanding notes may be retendered by following the procedures described under "
Procedures for Tendering Outstanding
Notes
" above at any time on or prior to the expiration date.
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Exchange Agent
The Bank of New York Mellon Trust Company, N.A. has been appointed as the exchange agent for the exchange offer. The Bank of New York Mellon
Trust Company, N.A., also acts as trustee under the indenture governing the notes. You should direct all executed letters of transmittal and all questions and requests for assistance with respect to
exchange offer procedures, and requests for additional copies of this prospectus or of the letters of transmittal to the exchange agent addressed as follows:
By Mail, Hand Delivery or Overnight Courier:
The Bank of New York Mellon Trust Company, N.A.
c/o The Bank of New York Mellon Corporation
Issuer & Loan Services / CSDReorg
111 Sanders Creek Parkway
East Syracuse, New York 13057
Attn: Adam DeCapioProcessor
(if by mail, registered or certified recommended)
|
|
|
By Facsimile:
|
|
To Confirm by Telephone:
|
732-667-9408
|
|
315-414-3360
|
Attn: Bondholder Communications
|
|
Attn: Bondholder Communications
|
If
you deliver the letter of transmittal to an address other than the one set forth above or transmit instructions via facsimile other than the one set forth above, that delivery
or those instructions will not be effective.
Fees and Expenses
The Registration Rights Agreement provides that we will bear all expenses in connection with the performance of our obligations relating to the
registration of the exchange notes and the conduct of the exchange offer. These expenses include registration and filing fees, accounting and legal fees and printing costs, among others. We will pay
the exchange agent reasonable and customary fees for its services and reasonable out-of-pocket expenses. We will also reimburse brokerage houses and other custodians, nominees and fiduciaries for
customary mailing and handling expenses incurred by them in forwarding this prospectus and related documents to their clients that are holders of outstanding notes and for handling or tendering for
such clients.
We
have not retained any dealer manager in connection with the exchange offer and will not pay any fee or commission to any broker, dealer, nominee or other person, for soliciting
tenders of outstanding notes pursuant to the exchange offer.
Accounting Treatment
We will record the exchange notes in our accounting records at the same carrying value as the outstanding notes, which is the aggregate
principal amount as reflected in our accounting records on the date of exchange. Accordingly, we will not recognize any gain or loss for accounting purposes upon the consummation of the exchange
offer. We will capitalize, as appropriate, the expenses of the exchange offer and amortize them over the life of the notes.
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Transfer Taxes
We will pay all transfer taxes, if any, applicable to the exchanges of outstanding notes under the exchange offer. The tendering holder,
however, will be required to pay any transfer taxes, whether imposed on the registered holder or any other person, if:
-
-
certificates representing outstanding notes for principal amounts not tendered or accepted for exchange are to be delivered to, or are to be
issued in the name of, any person other than the registered holder of outstanding notes tendered;
-
-
tendered outstanding notes are registered in the name of any person other than the person signing the letter of transmittal; or
-
-
a transfer tax is imposed for any reason other than the exchange of outstanding notes under the exchange offer.
If
satisfactory evidence of payment of such taxes is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed to that tendering holder.
Holders
who tender their outstanding notes for exchange notes will not be required to pay any transfer taxes. However, holders who instruct us to register exchange notes in the name of,
or request that outstanding notes not tendered or not accepted in the exchange offer be returned to, a person other than the registered tendering holder will be required to pay any applicable transfer
tax.
Consequences of Failure to Exchange
If you do not exchange your outstanding notes for exchange notes under the exchange offer, your outstanding notes will remain subject to the
restrictions on transfer of such outstanding notes:
-
-
as set forth in the legend printed on the outstanding notes as a consequence of the issuance of the outstanding notes pursuant to the
exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws; and
-
-
as otherwise set forth in the applicable offering memorandum distributed in connection with the private offering of the outstanding notes.
In
general, you may not offer or sell your outstanding notes unless they are registered under the Securities Act or if the offer or sale is exempt from registration under the Securities
Act and applicable state securities laws. Except as required by the Registration Rights Agreement, we do not intend to register resales of the outstanding notes under the Securities Act.
Other
Participating in the exchange offer is voluntary, and you should carefully consider whether to accept. You are urged to consult your financial
and tax advisors in making your own decision on what action to take.
We
may in the future seek to acquire untendered outstanding notes in open market or privately negotiated transactions, through subsequent exchange offers or otherwise. We have no present
plans to acquire any outstanding notes that are not tendered in the exchange offer or to file a registration statement to permit resales of any untendered outstanding notes.
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DESCRIPTION OF THE EXCHANGE NOTES
You can find the definitions of certain terms used in this description under the subheading "
Certain
Definitions
." In this description, the word "LifePoint" refers only to LifePoint Health, Inc. and not to any of its subsidiaries.
LifePoint
issued $500.0 million in aggregate principal amount of 5.375% Senior Notes due 2024 (the "outstanding notes") under the indenture dated May 26, 2016, among
itself, the Guarantors and The Bank of New York Mellon Trust Company, N.A., as trustee (the "indenture"). The exchange notes will also be issued under the indenture. The exchange notes are part of the
same series of notes previously issued under the indenture. The terms of the notes include those stated in the indenture and those made part of the indenture by reference to the Trust Indenture Act of
1939.
The
following description is a summary of the material provisions of the indenture. It does not restate that agreement in its entirety. We urge you to read the indenture because it, and
not this description, defines your rights as holders of the notes. Copies of the indenture are available as set forth below under "
Concerning the
Trustee
." Certain defined terms used in this description but not defined below under "
Certain Definitions
" have the
meanings assigned to them in the indenture. The exchange notes will be issued only in fully registered book entry form without coupons only in minimum denominations of $2,000 and integral multiples of
$1,000 in excess thereof. The exchange notes will be issued in the form of global notes, registered in the name of a nominee of DTC, New York, New York as described under "
Book
Entry Settlement and Clearance
.".
The
registered Holder of a note will be treated as the owner of it for all purposes. Only registered Holders will have rights under the indenture.
Brief Description of the Notes and the Guarantees
The Notes
The notes:
-
-
are senior unsecured obligations of LifePoint;
-
-
are senior in right of payment to all existing and future obligations of LifePoint that are by their terms expressly subordinated or junior in
right of payment to the notes;
-
-
are
pari passu
in right of payment with all existing and future unsubordinated obligations of
LifePoint;
-
-
are effectively junior to any of LifePoint's existing and future secured obligations to the extent of the value of the assets securing such
obligations, including obligations under the Credit Agreement; and
-
-
are structurally subordinated to all existing and future obligations, including trade payables, of those LifePoint Subsidiaries that will not
guarantee the notes.
The Guarantees
The Guarantors will jointly and severally irrevocably and unconditionally guarantee, on a senior basis, the performance and full and punctual
payment when due, whether at maturity, by acceleration or otherwise, of all obligations of LifePoint under the notes and the indenture, whether for payment of principal of, premium, if any, or
interest on the notes, expenses, indemnification or otherwise, on the terms set forth in the indenture by executing the indenture. Each of LifePoint's Domestic Subsidiaries that is a Wholly-Owned
Subsidiary, other than any Excluded Subsidiary, and each Domestic Subsidiary that is a non-Wholly-Owned Subsidiary if such non-Wholly-Owned Subsidiary guarantees Indebtedness
37
Table of Contents
under
the Credit Agreement, any other credit agreement, bank facility, term loan or any capital markets securities of LifePoint or a Guarantor will, subject to certain exceptions, guarantee the notes.
Each
guarantee of the notes:
-
-
is a senior unsecured obligation of the Guarantor;
-
-
is senior in right of payment to all existing and future obligations of that Guarantor that are expressly subordinated to its guarantee;
-
-
is
pari passu
in right of payment with all existing and future unsubordinated obligations of
that Guarantor; and
-
-
is effectively junior to any existing and future secured obligations of that Guarantor to the extent of the value of the assets securing such
obligations, including obligations under the Credit Agreement.
As
of March 31, 2017, LifePoint and the Guarantors had approximately $2,835.1 million of unsubordinated Indebtedness, excluding unamortized debt issuance costs and premium,
$735.1 million of which was secured and would effectively rank senior to the notes and the Guarantees to the extent of the value of the collateral securing such Indebtedness; in addition, we
would have had the ability to borrow an additional $581.3 million under our Credit Agreement, which represents $600.0 million available under our revolving credit facility thereunder,
net of outstanding letters of credit of $18.7 million, but excluding amounts available under the uncommitted accordion features of our Credit Agreement.
Not
all of LifePoint's Subsidiaries will guarantee the notes. In particular, our Domestic Subsidiaries which are non-Wholly Owned Subsidiaries and which do not guarantee Indebtedness
under the Credit Agreement, any other credit agreement, bank facility, term loan or any capital markets securities of LifePoint or a Guarantor, and certain Wholly Owned Subsidiaries that are Excluded
Subsidiaries, will not guarantee the notes. See "
Risk FactorsRisks relating to our indebtedness and this offeringThe notes will be structurally
subordinated to all obligations of our non-guarantor subsidiaries and effectively subordinated to our secured obligations
."
In
the event of a bankruptcy, liquidation or reorganization of any of these non-guarantor Subsidiaries, the non-guarantor Subsidiaries will pay the holders of their debt and their trade
creditors before they will be able to distribute any of their assets to LifePoint. As of March 31, 2017, the non-guarantor
Subsidiaries had total liabilities, including trade payables and excluding intercompany liabilities, of approximately $462.8 million. The non-guarantor Subsidiaries accounted for
$703.1 million, or 43.1%, of our total revenues for the three months ended March 31, 2017 and $2,171.7 million, or 34.2%, of our total assets and $462.8 million, or 11.8%,
of our total liabilities (excluding intercompany liabilities) as of March 31, 2017.
Principal, Maturity and Interest
LifePoint will issue the exchange notes in an aggregate principal amount of $500 million. LifePoint may issue additional notes from time
to time after this offering. Any offering of additional notes is subject to the covenant described below under the caption "
Certain
CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
." The notes and any additional notes of the same series subsequently issued under the indenture
will be treated as a single class for all purposes under the indenture, including, without limitation, waivers, amendments, redemptions and offers to purchase. LifePoint will issue notes in minimum
denominations of $2,000 and integral multiples of $1,000 in excess thereof. The notes will mature on May 1, 2024.
Interest
on the notes will accrue at the rate of 5.375% per annum. Interest on the notes will be payable semi-annually in arrears on May 1 and November 1, commencing on
November 1, 2016.
38
Table of Contents
LifePoint
will make each interest payment to the Holders of record at the close of business on the immediately preceding April 15 and October 15 (whether or not a business day).
Interest
on the notes will accrue from the date of original issuance or, if interest has already been paid or duly provided for from the date it was most recently paid or duly provided
for. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months.
Methods of Receiving Payments on the Notes
If a Holder has given wire transfer instructions to LifePoint and the trustee at least 15 days prior to the applicable payment date, all
principal, interest and premium on that Holder's notes will be paid in accordance with those instructions, subject to surrender of the note in the case of payment of principal and premium. All
payments of interest on certificated notes will be made at the office or agency of the paying agent and registrar unless LifePoint elects to make interest payments by check mailed to the Holders at
their address set forth in the register of Holders. LifePoint will pay principal of, and premium (if any) and interest (including additional interest, if any) on notes in global form registered in the
name of or held by DTC or its nominee in immediately available funds to DTC or its nominee, as the case may be, as the registered Holder of such Global Note.
Paying Agent and Registrar for the Notes
The trustee will initially act as paying agent and registrar. LifePoint may change the paying agent or registrar without prior notice to the
Holders of the notes, and LifePoint or any of its Subsidiaries may act as paying agent or registrar.
Transfer and Exchange
A Holder may transfer or exchange notes in accordance with the indenture. The registrar and the trustee may require a Holder to furnish
appropriate endorsements and transfer documents in connection with a transfer of notes. Holders will be required to pay all taxes due on transfer. LifePoint is not required to transfer or exchange any
note selected for redemption. Also, LifePoint is not required to transfer or exchange any note for a period of 15 days before a selection of notes to be redeemed.
Subsidiary Guarantees
The Subsidiary Guarantees will be full and unconditional, and joint and several obligations of the Guarantors. Each Subsidiary Guarantee will be
a senior unsecured obligation of that Guarantor. The obligations of each Guarantor under its Subsidiary Guarantee will be limited as necessary to prevent that Subsidiary Guarantee from constituting a
fraudulent conveyance under applicable law. If a Subsidiary Guarantee were rendered voidable, it could be subordinated by a court to all other indebtedness (including guarantees and other contingent
liabilities) of the applicable Guarantor, and depending on the amount of such indebtedness, a Guarantor's liability on its Subsidiary Guarantee could be reduced to zero. See
"
Risk FactorsRisks relating to our indebtedness and this offeringYour ability to enforce the guarantees of the notes may be
limited
."
A
Guarantor may not sell or otherwise dispose of all or substantially all of its assets to, or consolidate with or merge with or into (whether or not such Guarantor is the surviving
Person), another Person, other than LifePoint or another Guarantor, unless:
-
(1)
-
immediately
after giving effect to that transaction, no Default or Event of Default exists; and
-
(2)
-
subject
to the provisions of the following paragraph, the Person acquiring the property in any such sale or disposition or the Person formed by or surviving any such
consolidation or merger
39
Table of Contents
The
Subsidiary Guarantee of a Guarantor will be released, and any Person acquiring assets (including by way of merger or consolidation) or Capital Stock of a Guarantor shall not be
required to assume the obligations of any such Guarantor:
-
(1)
-
in
connection with any sale or other disposition of all or substantially all of the assets of such Guarantor (including by way of merger or consolidation) to a
Person that is not (either before or after giving effect to such transaction) a Restricted Subsidiary, if the sale or other disposition complies with the first paragraph of the covenant described
under "
Repurchase at the Option of HoldersAsset Sales
";
-
(2)
-
in
connection with any sale of the Capital Stock of such Guarantor to a Person that is not (either before or after giving effect to such transaction) a Restricted
Subsidiary, if as a result of such sale such Guarantor ceases to be a Subsidiary of LifePoint and the sale complies with the first paragraph of the covenant described under
"
Repurchase at the Option of HoldersAsset Sales
";
-
(3)
-
if
LifePoint (i) designates such Guarantor to be an Unrestricted Subsidiary or (ii) designates such Guarantor to be an Excluded Subsidiary, in each
case in accordance with the requirements of the indenture;
-
(4)
-
if
such Guarantor is or becomes a non-Wholly-Owned Subsidiary and does not then guarantee Indebtedness under the Credit Agreement, any other credit agreement, bank
facility, term loan or any capital markets securities of LifePoint or a Guarantor;
-
(5)
-
if
such Guarantor is otherwise no longer obligated to provide a Subsidiary Guarantee pursuant to the indenture;
-
(6)
-
upon
LifePoint's exercise of its legal defeasance option or covenant defeasance option as described under "
Legal Defeasance and
Covenant Defeasance
" below or if LifePoint's obligations under the indenture and notes are discharged in accordance with the terms of the indenture; or
-
(7)
-
pursuant
to the covenant described below under the caption "
Certain CovenantsCovenant
Suspension
."
Optional Redemption
At any time prior to May 1, 2019, LifePoint may on any one or more occasions redeem up to 35% of the aggregate principal amount of the
notes (including any additional notes) at a redemption price of 105.375% of the principal amount, plus accrued and unpaid interest, if any, to (but not including) the redemption date, with the net
cash proceeds of one or more Equity Offerings;
provided
that:
-
(1)
-
at
least 65% of the aggregate principal amount of such notes remains outstanding immediately after the occurrence of such redemption (excluding notes held by
LifePoint and its Subsidiaries); and
-
(2)
-
the
redemption occurs within 180 days of the date of the closing of such Equity Offering.
At
any time prior to May 1, 2019, LifePoint may redeem all or a part of the notes, upon not less than 30 nor more than 60 days' notice, at a redemption price equal to 100%
of the principal amount thereof, plus the Applicable Redemption Premium and accrued and unpaid interest to (but not including) the redemption date.
40
Table of Contents
Except
pursuant to the preceding two paragraphs, the notes will not be redeemable at LifePoint's option prior to May 1, 2019. On or after May 1, 2019, LifePoint may redeem
all or a part of the notes upon not less than 30 nor more than 60 days' notice, at the redemption prices (expressed as percentages of principal amount) set forth below plus accrued and unpaid
interest, if any, on the notes redeemed,
to (but not including) the applicable redemption date, if redeemed during the twelve-month period beginning on May 1 of the years indicated below.
|
|
|
|
|
Period
|
|
Redemption
Price
|
|
2019
|
|
|
104.031
|
%
|
2020
|
|
|
102.688
|
%
|
2021
|
|
|
101.344
|
%
|
2022 and thereafter
|
|
|
100.000
|
%
|
Mandatory Redemption
Except as set forth below under "
Repurchase at the Option of Holders
," LifePoint is
not required to make mandatory redemption or sinking fund payments with respect to the notes.
Repurchase at the Option of Holders
Change of control
If a Change of Control occurs, unless LifePoint has exercised its right to redeem all of the notes as described above under
"
Optional Redemption
" by giving notice of such redemption to the holders of the notes, each Holder of notes will have the right to require
LifePoint to repurchase all or any part (equal to $1,000 or an integral multiple of $1,000 in excess thereof;
provided
that the unrepurchased portion of
a note must be in a minimum denomination of $2,000) of that Holder's notes pursuant to a Change of Control Offer on the terms set forth in the indenture. In the Change of Control Offer, LifePoint will
offer a Change of Control Payment in cash equal to 101% of the aggregate principal amount of notes repurchased plus accrued and unpaid interest, if any, on the notes repurchased, to (but not
including) the date of purchase. Within 30 days following any Change of Control, LifePoint will mail a notice to each Holder stating the transaction or transactions that constitute the Change
of Control and offering to repurchase notes on the Change of Control Payment Date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the
date such notice is mailed, pursuant to the procedures required by the indenture and described in such notice. LifePoint will comply, to the extent applicable, with the requirements of
Rule 14e-1 under the Securities Exchange Act of 1934, as amended (the "Exchange Act") and any other securities laws and regulations thereunder in connection with the repurchase of the notes as
a result of a Change of Control. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control provisions of the indenture, LifePoint will comply with the
applicable securities laws and regulations and will not be deemed to have breached its obligations under the Change of Control provisions of the indenture by virtue of such conflict.
On
the Change of Control Payment Date, LifePoint will, to the extent lawful:
-
(1)
-
accept
for payment all notes or portions of notes properly tendered pursuant to the Change of Control Offer;
-
(2)
-
deposit
with the paying agent an amount equal to the Change of Control Payment in respect of all notes or portions of notes properly tendered; and
-
(3)
-
deliver
or cause to be delivered to the trustee the notes properly accepted together with an officers' certificate stating the aggregate principal amount of notes or
portions of notes being purchased by LifePoint.
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Table of Contents
The
paying agent will promptly deliver to each Holder of notes properly tendered the Change of Control Payment for such notes, and the trustee will promptly authenticate and deliver (or
cause to be transferred by book entry) to each Holder a new note equal in principal amount to any unpurchased portion of the notes surrendered, if any;
provided
that each new note will be in a principal
amount of $2,000 or an integral multiple of $1,000 in excess thereof. LifePoint will publicly
announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date. The provisions described above that require LifePoint to make a Change of
Control Offer following a Change of Control will be applicable whether or not any other provisions of the indenture are applicable.
LifePoint
will not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in
compliance with the requirements set forth in the indenture applicable to a Change of Control Offer made by LifePoint and purchases all notes properly tendered and not withdrawn under the Change of
Control Offer. Any Change of Control Offer may be made in advance of, and conditioned on the consummation of, such Change of Control.
A
Change of Control Offer may be made in advance of a Change of Control, and conditioned upon such Change of Control, if a definitive agreement is in place for the Change of Control at
the time of making of the Change of Control Offer.
The
definition of Change of Control includes a phrase relating to the direct or indirect sale, transfer, conveyance or other disposition of "all or substantially all" of the properties
or assets of LifePoint and its Restricted Subsidiaries taken as a whole. Although there is a limited body of case law interpreting the phrase "substantially all," there is no precise established
definition of the phrase under applicable law. Accordingly, the ability of a Holder of notes to require LifePoint to repurchase its notes as a result of a sale, lease, transfer, conveyance or other
disposition of less than all of the assets of LifePoint and its Restricted Subsidiaries taken as a whole to another Person or group may be uncertain.
The
Change of Control purchase feature of the notes may in certain circumstances make more difficult or discourage a sale or takeover of LifePoint and, thus, the removal of incumbent
management. The Change of Control purchase feature is a result of negotiations between us and the initial purchasers. We have no present intention to engage in a transaction involving a Change of
Control, although it is possible that we could decide to do so in the future. Subject to the limitations discussed below, we could, in the future, enter into certain other transactions, including
acquisitions, refinancings or other recapitalizations, that would not constitute a Change of Control under the indenture, but that could increase the amount of indebtedness outstanding at such time or
otherwise affect our capital structure or credit ratings. Restrictions on our ability to incur additional Indebtedness are contained in the
"Incurrence of Indebtedness and Issuance of Preferred Stock" covenant. Such restrictions can only be waived with the consent of the holders of a majority in principal amount of the notes then
outstanding. Except for the limitations contained in such covenants, however, the indenture does not contain any covenants or provisions that may afford Holders protection in the event of a highly
leveraged transaction. Future indebtedness that we may incur may contain prohibitions on the occurrence of certain events that would constitute a Change of Control or require the repurchase of such
indebtedness upon a Change of Control. Moreover, the exercise by the holders of their right to require us to repurchase their notes could cause a default under such indebtedness, even if the Change of
Control itself does not, due to the financial effect of such repurchase on us.
The
provisions under the indenture relative to our obligation to make an offer to repurchase the notes as a result of a Change of Control may be waived or modified with the consent of
the holders of a majority in principal amount of the notes.
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Asset Sales
LifePoint will not, and will not permit any of the Restricted Subsidiaries to, consummate an Asset Sale unless:
-
(1)
-
LifePoint
(or a Restricted Subsidiary) receives consideration at the time of the Asset Sale at least equal to the fair market value of the assets or Equity Interests
issued or sold or otherwise disposed of;
-
(2)
-
the
fair market value is determined by LifePoint's Board of Directors and evidenced by a resolution of the Board of Directors; and
-
(3)
-
at
least 75% of the consideration received in the Asset Sale by LifePoint or such Restricted Subsidiary is in the form of cash, Cash Equivalents and/or Replacement
Assets. For purposes of this provision, each of the following will be deemed to be cash:
-
(a)
-
any
liabilities, as shown on LifePoint's or any Restricted Subsidiary's most recent balance sheet, of LifePoint or any Restricted Subsidiary (other than contingent
liabilities and liabilities that are by their terms subordinated to the notes or any Subsidiary Guarantee) that are assumed by the transferee of any such assets and from which LifePoint or such
Restricted Subsidiary is released from further liability;
-
(b)
-
any
securities, notes or other obligations received by LifePoint or any such Restricted Subsidiary from such transferee that are converted by LifePoint or such
Restricted Subsidiary into cash within 180 days of receipt, to the extent of the cash received in that conversion; and
-
(c)
-
any
Designated Non-cash Consideration received by LifePoint or any of its Restricted Subsidiaries in such Asset Sale having an aggregate fair market value, taken
together with all other Designated Non-cash Consideration received pursuant to this clause (c) that is at that time outstanding, not to exceed the greater of $100 million and 2.0% of
Total Assets at the time of the receipt of such Designated Non-cash Consideration (with the fair market value of each item of Designated Non-cash Consideration being measured at the time received and
without giving effect to subsequent changes in value).
Within
365 days after the receipt of any Net Proceeds from an Asset Sale, LifePoint or a Restricted Subsidiary may apply those Net Proceeds at its option:
-
(1)
-
to
repay, prepay, redeem or purchase (x) Indebtedness of LifePoint or any Guarantor that is not Subordinated Indebtedness or (y) any Indebtedness of a
Restricted Subsidiary that is not a Guarantor;
-
(2)
-
to
acquire all or substantially all of the assets of, or a majority of the Voting Stock of, another Permitted Business;
-
(3)
-
to
make a capital expenditure;
-
(4)
-
to
acquire Replacement Assets; or
-
(5)
-
to
acquire other long-term assets that are used or useful in a Permitted Business.
LifePoint
or the Restricted Subsidiary will be deemed to have complied with the immediately preceding sentence with respect to any such Net Proceeds if it enters into a binding agreement
to make an acquisition or capital expenditure permitted pursuant to clause (2), (3), (4) or (5) of the immediately preceding sentence in an amount equal to such Net Proceeds
within such 365 days;
provided
that, if the relevant acquisition or capital expenditure is not consummated or completed, as the case may be,
within the later of (x) 365 days after the receipt of the relevant Net Proceeds and (y) 180 days after the date of such binding agreement, such Net Proceeds will constitute
"Excess
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Proceeds."
Pending the final application of any Net Proceeds, LifePoint or the Restricted Subsidiary may temporarily invest the Net Proceeds in any manner that is not prohibited by the indenture.
Any
Net Proceeds from Asset Sales that are not applied or invested as provided in the preceding paragraph will constitute Excess Proceeds. When the aggregate amount of Excess Proceeds
exceeds $75 million, LifePoint will make an offer (an "Asset Sale Offer") to all Holders of notes (and, at the option of LifePoint, to holders of any other Indebtedness of LifePoint or any
Guarantor that is not Subordinated Indebtedness and/or any Indebtedness of any Restricted Subsidiary of LifePoint (collectively, "other indebtedness")) to purchase the maximum principal amount of
notes (and such other Indebtedness), in minimum denominations of $1,000 principal amount and in integral multiples of $1,000 in excess thereof;
provided
that the unrepurchased portion of a note must be in a minimum denomination of $2,000, out of the Excess Proceeds at a purchase price of 100% of their principal amount (or, in the event such other
Indebtedness was issued with significant original issue discount, 100% of the accreted value thereof) without premium, plus accrued but unpaid interest (or, in respect of such other Indebtedness, such
lesser price, if any, as may be provided for by the terms of such Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in the indenture. To
the extent that the aggregate amount of notes (and such other Indebtedness) tendered pursuant to such an offer is less than the Excess Proceeds, LifePoint may use any remaining Excess Proceeds for
general corporate purposes. If the aggregate principal amount of notes (and such other Indebtedness) surrendered by holders thereof exceeds the amount of Excess
Proceeds, the trustee shall select the notes to be purchased in the manner described in the indenture. Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
LifePoint
will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations
are applicable in connection with each repurchase of notes pursuant to an Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale
provisions of the indenture, LifePoint will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Sale provisions of the
indenture by virtue of such conflict.
Selection and Notice
If less than all of the notes are to be redeemed at any time, the trustee will select notes for redemption on a
pro
rata
basis, by lot or by such method as the trustee deems fair and appropriate,
provided
, that with respect to notes held in the
form of Global Notes, the selection of such notes for redemption shall be made in accordance with the procedures of DTC.
No
notes of $2,000 or less can be redeemed in part. Notices of redemption will be delivered by first class mail at least 30 but not more than 60 days before the redemption date to
each Holder of notes to be redeemed at its registered address, except that redemption notices may be delivered more than 60 days prior to a redemption date if the notice is issued in connection
with a defeasance of the notes or a satisfaction and discharge of the indenture. Notices of redemption may be conditional upon the occurrence of certain events, including equity offerings.
If
any note is to be redeemed in part only, the notice of redemption that relates to that note will state the portion of the principal amount of that note that is to be redeemed. A new
note in principal amount equal to the unredeemed portion of the original note will be issued in the name of the Holder of notes upon cancellation of the original note. Notes called for redemption
become due on the date fixed for redemption. On and after the redemption date, interest ceases to accrue on notes or portions of them called for redemption.
44
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Certain Covenants
Covenant Suspension
From and after the first date on which both (a) the notes are rated Investment Grade by each of Moody's Investor Service, Inc.
("Moody's") and Standard & Poor's Ratings Group ("S&P" and together with Moody's the "Rating Agencies") and (b) there shall not exist a Default or Event of Default under the indenture
(the occurrence of the events described in the foregoing
clauses (a) and (b) being collectively referred to as a "Covenant Suspension Event"), LifePoint and the Restricted Subsidiaries will no longer be subject to the covenants described under
the captions "
Repurchase at the Option of HoldersAsset Sales
," "
Restricted
Payments
," "
Incurrence of Indebtedness and Issuance of Preferred Stock
,"
"
Liens
," "
Dividend and Other Payment Restrictions Affecting Restricted
Subsidiaries
," "
Limitation on Sale and Leaseback Transactions
," clause (4) of the first paragraph under
"
Merger, Consolidation or Sale of Assets
," "
Transactions with Affiliates
" and
"
Additional Subsidiary Guarantees
" (collectively, the "Suspended Covenants");
provided
that, during the Suspension Period (as defined below), LifePoint and its Restricted Subsidiaries will be subject to the covenant described below under the caption
"
Limitation on Secured Indebtedness
." Upon the occurrence of a Covenant Suspension Event (the "Suspension Date"), the Subsidiary Guarantees
of each of the Guarantors will be automatically released.
In
the event that LifePoint and the Restricted Subsidiaries are not subject to the Suspended Covenants under the indenture for any period of time as a result of the foregoing, and on any
subsequent date (the "Reversion Date") one or both of the Rating Agencies withdraw their Investment Grade rating or downgrade the rating assigned to the notes below an Investment Grade rating then,
following the Reversion Date, LifePoint and the Restricted Subsidiaries will again be subject to the Suspended Covenants under the indenture and all required Subsidiary Guarantees will be reinstated
and issued. Following the Reversion Date, LifePoint and its Restricted Subsidiaries will not be subject to the covenant described below under the caption
"
Limitation on Secured Indebtedness
."
The
period of time between the Suspension Date and the Reversion Date is referred to in this description as the "Suspension Period." Additionally, upon the occurrence of a Covenant
Suspension Event, the amount of Excess Proceeds from Net Proceeds shall be reset at zero. In the event of any such reinstatement, no action taken or omitted to be taken by LifePoint or any of its
Restricted Subsidiaries prior to such reinstatement will give rise to a Default or Event of Default under the indenture with respect to notes. Calculations made after the Reversion Date of the amount
available to be made as Restricted Payments under the covenant described under the caption "
Restricted Payments
" will be made as though
such covenant had been in effect since the Issue Date and during the Suspension Period. For purposes of the "
Incurrence of Indebtedness and Issuance of Preferred
Stock
" covenant, all Indebtedness incurred, or Disqualified Stock or preferred stock issued, during the Suspension Period will be classified to have been incurred or issued
pursuant to clause (2) of the second paragraph of such covenant. For purposes of the "
Liens
" covenant, on the Reversion Date, any
Lien securing Indebtedness, which Lien was permitted by the "
Limitation on Secured Indebtedness
" covenant and did not require that a Lien
be created for the benefit of note Holders pursuant to the requirements of the "
Limitation on Secured Indebtedness
" covenant, shall be
deemed to have been outstanding on the Issue Date so that it is classified as permitted under clause (5) of the definition of "Permitted Lien." For purposes of the
"
Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries
" covenant, on the Reversion Date, any encumbrance or restriction
on the ability of any Restricted Subsidiary described under clauses (1), (2) or (3) of the first paragraph thereof created, otherwise caused or permitted to exist or become
effective during the Suspension Period shall be deemed to have been outstanding on the Issue Date, so that it is classified as permitted under clause (1) of the second paragraph of such
covenant. For purposes of the "
Transactions with Affiliates
" covenant, on the Reversion Date, any Affiliate Transaction entered into or
permitted to exist
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during
the Suspension Period shall be deemed to have been outstanding on the Issue Date, so that it is classified as permitted under clause (2) of the second paragraph of such covenant.
In
the event Moody's or S&P is no longer in existence or issuing ratings, such organization may be replaced by a nationally recognized statistical rating organization (as defined in
Rule 436 under the Securities Act) designated by LifePoint with notice to the trustee and the foregoing provisions will apply to the rating issued by the replacement rating agency.
Limitation on Secured Indebtedness
During any Suspension Period, LifePoint will not, and will not permit any Restricted Subsidiary to, incur any Indebtedness secured by a Lien
(other than a Permitted Lien) on any Principal Property or on any share of stock or Indebtedness of a Subsidiary without making effective provisions whereby LifePoint or such Restricted Subsidiary, as
the case may be, will secure the notes equally and ratably with (or, if the Indebtedness to be secured by such Lien is subordinated in right of payment to the notes, prior to) the Indebtedness so
secured until such time as such Indebtedness is no longer secured by a Lien, unless the aggregate amount of all Indebtedness secured by all such Liens (excluding any Permitted Lien) would not exceed
5% of Total Assets. Any Lien created for the benefit of the holders of the notes pursuant to the preceding sentence shall provide by its terms that such Lien shall be automatically and unconditionally
released and discharged upon the release and discharge of the initial Lien.
Restricted Payments
LifePoint will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly:
-
(1)
-
declare
or pay any dividend or make any other payment or distribution on account of LifePoint's or any Restricted Subsidiary's Equity Interests (including, without
limitation, any payment in connection with any merger or consolidation involving LifePoint or any of its Restricted Subsidiaries) or to the direct or indirect holders of LifePoint's or any of its
Restricted Subsidiaries' Equity Interests in their capacity as such (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of LifePoint or to LifePoint or a
Restricted Subsidiary);
-
(2)
-
purchase,
redeem or otherwise acquire or retire for value (including, without limitation, in connection with any merger or consolidation involving LifePoint) any
Equity Interests of LifePoint (other than Equity Interests held by a Restricted Subsidiary);
-
(3)
-
make
any voluntary or optional payment on or with respect to, or purchase, redeem, defease or otherwise acquire or retire for value any Subordinated Indebtedness
(other than Subordinated Indebtedness held by LifePoint or a Restricted Subsidiary), except a payment of interest or principal at the Stated Maturity thereof or the purchase, redemption, defeasance,
acquisition or retirement for value of any such Indebtedness within 365 days of the Stated Maturity thereof; or
-
(4)
-
make
any Restricted Investment
(all
such payments and other actions set forth in these clauses (1) through (4) above being collectively referred to as "Restricted Payments"), unless, at the time of and after giving
effect to such Restricted Payment:
-
(1)
-
no
Default or Event of Default has occurred and is continuing or would occur as a consequence of such Restricted Payment;
-
(2)
-
LifePoint
would, at the time of such Restricted Payment and after giving
pro forma
effect thereto as if such
Restricted Payment had been made at the beginning of the applicable
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The
preceding provisions will not prohibit:
-
(1)
-
the
payment of any dividend within 60 days after the date of declaration of the dividend, if at the date of declaration the dividend payment would have
complied with the provisions of the indenture;
-
(2)
-
the
redemption, repurchase, retirement, defeasance or other acquisition of any Subordinated Indebtedness of LifePoint or any Restricted Subsidiary or of any Equity
Interests of LifePoint in exchange for, or out of the net cash proceeds of the substantially concurrent sale (other
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provided
that cancellation of Indebtedness owing to LifePoint or any Restricted Subsidiary from any future, present or former employees, directors,
managers or consultants of LifePoint (or any permitted transferee thereof), or any Restricted Subsidiary in connection with a repurchase of Equity Interests of LifePoint will not be deemed to
constitute a Restricted Payment for purposes of this covenant or any other provision of the indenture;
-
(6)
-
the
repurchase of Equity Interests deemed to occur upon the exercise of stock options or stock appreciation rights or the lapsing of restrictions on restricted
stock, to the extent such Equity Interests represent a portion of the exercise price of those stock options or stock appreciation rights or the withholding taxes payable in connection with such stock
options, stock appreciation rights or restricted stock;
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-
(7)
-
the
repurchase of any class of Capital Stock of a Restricted Subsidiary (other than Disqualified Stock) if such repurchase is made
pro
rata
among all holders of such class of Capital Stock;
-
(8)
-
the
payment of any dividend or similar distribution, and any repayment of the stated amount, liquidation preference or any similar amount at final maturity or on any
redemption or repurchase date, in respect of any series of preferred stock or similar securities of LifePoint or any Restricted Subsidiary (including Disqualified Stock),
provided
that such series of
preferred stock or similar securities was issued in compliance with the "
Incurrence of
Indebtedness and Issuance of Preferred Stock
" covenant;
-
(9)
-
payments
in lieu of fractional shares;
-
(10)
-
the
purchase of any Indebtedness that is subordinate to the notes at a purchase price no greater than 101% of the principal amount thereof in the event of a Change
of Control in accordance with provisions similar to those described under the caption "
Repurchase at the Option of HoldersChange of
control
";
provided
that prior to or simultaneously with such purchase LifePoint has made the Change of Control Offer as provided
in such section and has purchased all notes validly tendered for payment in connection with such Change of Control Offer;
-
(11)
-
payments
or distributions to dissenting stockholders pursuant to applicable law in connection with any merger, consolidation or disposition in accordance with the
terms of the indenture;
-
(12)
-
the
purchase, redemption, cancellation or other retirement for a nominal value per right of any rights granted to holders of LifePoint common stock pursuant to a
shareholder rights plan;
-
(13)
-
the
repurchase, redemption or other acquisition of Disqualified Stock of LifePoint or any of its Restricted Subsidiaries in exchange for or out of the proceeds of a
substantially concurrent offering of, Disqualified Stock of LifePoint;
-
(14)
-
the
repurchase of Equity Interests of LifePoint in an aggregate amount after the Issue Date not to exceed $550 million;
-
(15)
-
the
purchase of any Subordinated Indebtedness from Net Proceeds to the extent permitted by the provisions under "
Repurchase at
the Option of HoldersAsset Sales
;"
-
(16)
-
the
payment by LifePoint of dividends on its common stock in an aggregate annual amount of $25 million;
-
(17)
-
additional
Restricted Payments pursuant to this clause (17) in an aggregate amount after the Issue Date not to exceed the greater of $325 million and
6.0% of Total Assets at the time of such Restricted Payment (with each such Restricted Payment being valued as of the date made and without regard to subsequent changes in value); and
-
(18)
-
any
Restricted Payment;
provided
that on a
pro forma
basis after
giving effect to such Restricted Payment the Consolidated Total Leverage Ratio would be equal to or less than 2.5 to 1.00;
provided
that at the time of, and after giving effect to, any Restricted Payment permitted under subclause (b) of clause (3) and
clauses (17) and (18) above, no Default has occurred and is continuing or would be caused thereby.
The
amount of all Restricted Payments (other than cash) will be the fair market value on the date of the Restricted Payment of the asset(s) or securities proposed to be transferred or
issued by LifePoint or such Restricted Subsidiary, as the case may be, pursuant to the Restricted Payment. The fair market
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value
of any assets or securities that are required to be valued by this covenant will be determined by the Board of Directors of LifePoint in good faith, whose determination with respect thereto will
be conclusive.
For
purposes of determining compliance with this "Restricted Payments" covenant, in the event that a Restricted Payment meets the criteria of more than one of the categories of
Restricted Payments described in clauses (1) through (18) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, LifePoint will be entitled to classify
such Restricted Payment (or portion thereof) on the date of its payment or later reclassify such Restricted Payment (or portion thereof) in any manner that complies with this covenant.
As
of the Issue Date, LifePoint would have been able to make approximately $550 million of Restricted Payments under the provisions of the indenture described in the first
paragraph above.
Incurrence of Indebtedness and Issuance of Preferred Stock
LifePoint will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guarantee
or otherwise become directly or indirectly liable, contingently or otherwise, with respect to (collectively, "incur") any Indebtedness (including Acquired Debt), and LifePoint will not issue any
Disqualified Stock and will not permit any of its Restricted Subsidiaries to issue any shares of preferred stock;
provided
,
however
, that LifePoint and any
Restricted Subsidiary may incur Indebtedness (including Acquired Debt) and LifePoint may issue Disqualified Stock and
any Restricted Subsidiary may issue preferred stock (including Disqualified Stock) if the Fixed Charge Coverage Ratio for LifePoint's most recently ended four full fiscal quarters for which internal
financial statements are available immediately preceding the date on which such additional Indebtedness is incurred or such Disqualified Stock or preferred stock is issued would have been at least 2.0
to 1, determined on a
pro forma
basis (including a
pro forma
application of the net proceeds therefrom),
as if the additional Indebtedness had been incurred or the Disqualified Stock or preferred stock had been issued, as the case may be, at the beginning of such four-quarter period.
The
first paragraph of this covenant will not prohibit the following (collectively, "Permitted Debt"):
-
(1)
-
the
incurrence by LifePoint and its Restricted Subsidiaries of additional Indebtedness and letters of credit under Credit Facilities in an aggregate principal amount
at any one time outstanding under this clause (1) (with letters of credit being deemed to have a principal amount equal to the maximum potential liability of LifePoint and its Restricted
Subsidiaries thereunder) not to exceed $2,000 million;
-
(2)
-
Existing
Indebtedness;
-
(3)
-
the
incurrence by LifePoint and the Guarantors of Indebtedness represented by (a) the notes and the related Subsidiary Guarantees to be issued on the Issue
Date and (b) the Exchange Notes and the Exchange Subsidiary Guarantees to be issued pursuant to the indenture in exchange for the notes and the Subsidiary Guarantees in accordance with the
terms of the Registration Rights Agreement;
-
(4)
-
the
incurrence by LifePoint or any of its Restricted Subsidiaries of Indebtedness represented by Capital Lease Obligations, mortgage financings or purchase money
obligations, in each case, incurred for the purpose of financing all or any part of the purchase price or cost of construction or improvement of property, plant or equipment used in the business of
LifePoint or such Subsidiary, in an aggregate principal amount, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this
clause (4), not to exceed the greater of $250 million and 5.0% of Total Assets at any time outstanding;
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-
(5)
-
the
incurrence by LifePoint or any of its Restricted Subsidiaries of Permitted Refinancing Indebtedness in exchange for, or the net proceeds of which are used to
extend, refinance, renew, replace, defease, or refund Indebtedness (other than intercompany Indebtedness) that was permitted by the indenture to be incurred under the first paragraph of this covenant
or clauses (2), (3), (4), (12), (13), (15), (26) or this clause (5) of this paragraph;
-
(6)
-
the
incurrence by LifePoint or any of its Restricted Subsidiaries of intercompany Indebtedness or the issuance of Disqualified Stock or Preferred Stock between or
among LifePoint and any of its Restricted Subsidiaries;
provided
,
however
, that (a) any
subsequent issuance or transfer of Equity Interests that results in any such Indebtedness, Disqualified Stock or Preferred Stock being held by a Person other than LifePoint or a Restricted Subsidiary
and (b) any sale or other transfer of any such Indebtedness, Disqualified Stock or Preferred Stock to a Person that is not either LifePoint or a Restricted Subsidiary, will be deemed, in each
case, to constitute an incurrence of such Indebtedness, Disqualified Stock or Preferred Stock by LifePoint or such Restricted Subsidiary, as the case may be, that was not permitted by this
clause (6);
-
(7)
-
the
incurrence by LifePoint or any of its Restricted Subsidiaries of Hedging Obligations that are incurred for the purpose of fixing or hedging (a) interest
rate risk with respect to any Indebtedness that is permitted by the terms of the indenture to be outstanding or (b) exchange rate risk with respect to obligations under any agreement or
Indebtedness, or with respect to any asset, of such Person that is payable or denominated in a currency other than U.S. Dollars;
-
(8)
-
the
guarantee by LifePoint or any of the Restricted Subsidiaries of Indebtedness of LifePoint or a Restricted Subsidiary that was permitted to be incurred by another
provision of this covenant;
-
(9)
-
the
accrual of interest, the accretion or amortization of original issue discount, the payment of interest on any Indebtedness in the form of additional Indebtedness
with the same terms, and the payment of dividends on preferred stock (including Disqualified Stock) in the form of additional shares of the same class of preferred stock (including Disqualified Stock)
will not be deemed to be an incurrence of Indebtedness or an issuance of preferred stock (including Disqualified Stock) for purposes of this covenant;
provided
, in each such case, that the amount
thereof is included in Fixed Charges of LifePoint as accrued;
-
(10)
-
Indebtedness
of LifePoint or any Restricted Subsidiary consisting of guarantees, indemnities, hold backs or obligations in respect of purchase price adjustments in
connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock of Restricted Subsidiaries, or contingent payment obligations incurred in connection
with the acquisition or disposition of assets which are contingent on the performance of the assets acquired or disposed of;
-
(11)
-
Indebtedness
represented by (a) letters of credit for the account of LifePoint or any Restricted Subsidiary or (b) other obligations to reimburse
third parties pursuant to any surety bond or other similar arrangements, to the extent that such letters of credit and other obligations, as the case may be, are intended to provide security for
workers' compensation claims, payment obligations in connection with self-insurance, in connection with participation in government reimbursement or other programs or other similar requirements in the
ordinary course of business;
-
(12)
-
the
incurrence by LifePoint or any Restricted Subsidiary of Indebtedness to the extent the proceeds thereof are used to purchase notes pursuant to a Change of
Control Offer or to defease or discharge notes in accordance with the terms of the indenture;
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-
(13)
-
Indebtedness
arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of
daylight overdrafts) drawn against insufficient funds in the ordinary course of business;
provided
,
however
, that such Indebtedness is extinguished within
five Business Days of incurrence;
-
(14)
-
Indebtedness
incurred in the ordinary course of business in connection with cash pooling arrangements, cash management and other Indebtedness incurred in the
ordinary course of business in respect of netting services, overdraft protections and similar arrangements in each case in connection with cash management and deposit accounts;
-
(15)
-
Indebtedness
consisting of (a) the financing of insurance premiums or (b) take or pay obligations in supply agreements, in each case in the ordinary
course of business;
-
(16)
-
Indebtedness
of LifePoint and its Subsidiaries representing the obligation of such Person to make payments with respect to the cancellation or repurchase of Capital
Stock of officers, employees or directors (or their estates) of LifePoint or such Subsidiaries pursuant to the terms of employment, severance or termination agreements, benefit plans or similar
documents;
-
(17)
-
Indebtedness
incurred by a Securitization Subsidiary in connection with a Qualified Securitization Transaction that is not recourse with respect to LifePoint and
its Restricted Subsidiaries;
provided
,
however
, that in the event such Securitization Subsidiary ceases
to qualify as a Securitization Subsidiary or such Indebtedness becomes recourse to LifePoint or any of its Restricted Subsidiaries, such Indebtedness will, in each case, be deemed to be, and must be
classified by LifePoint as, incurred at such time (or at the time initially incurred) under one more of the other provisions of this covenant;
-
(18)
-
the
disposition of accounts receivable in connection with receivables factoring arrangements in the ordinary course of business;
-
(19)
-
unsecured
Indebtedness in respect of obligations of LifePoint or any of its Restricted Subsidiaries to pay the deferred purchase price of goods or services or
progress payments in connection with such goods and services;
provided
that such obligations are incurred in connection with open accounts extended by
suppliers on customary trade terms (which require that all such payments be made within 60 days after the incurrence of the related obligations) in the ordinary course of business;
-
(20)
-
Indebtedness
representing deferred compensation to employees of LifePoint or any of its Restricted Subsidiaries incurred in the ordinary course of business;
-
(21)
-
reimbursement
obligations with respect to letters of credit, bank guarantees, warehouse receipts or similar instruments issued in the ordinary course of business,
and Indebtedness of LifePoint in respect of letters of credit issued by LifePoint for its own account or for the account of any of its Restricted Subsidiaries;
-
(22)
-
Indebtedness
arising from any Sale and Leaseback Transaction;
provided
that the principal amount of any Indebtedness
incurred pursuant to this clause may not exceed (a) $50 million;
-
(23)
-
Physician
Support Obligations incurred by LifePoint or any Restricted Subsidiary;
-
(24)
-
Indebtedness
incurred on behalf of or representing Guarantees of Indebtedness of Permitted Joint Ventures of LifePoint or any Restricted Subsidiary not in excess
the greater of $50 million and 1.0% of Total Assets at any one time outstanding;
-
(25)
-
the
incurrence by LifePoint or any of its Restricted Subsidiaries of additional Indebtedness (which may include, but is not limited to, Indebtedness of the types
referred to in the foregoing clauses (1) through (24) and clause (26)) in an aggregate principal amount (or
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accreted
value, as applicable) at any time outstanding, including all Permitted Refinancing Indebtedness incurred to refund, refinance or replace any Indebtedness incurred pursuant to this
clause (25), not to exceed the greater of $300 million and 6.0% of Total Assets;
-
(26)
-
Indebtedness
of (x) LifePoint or a Restricted Subsidiary incurred to finance an acquisition or (y) a Restricted Subsidiary outstanding on the date on
which such Restricted Subsidiary was acquired by LifePoint or otherwise became a Restricted Subsidiary;
provided
that after giving effect thereto,
(a) LifePoint would be permitted to incur at least $1 of additional Indebtedness pursuant to the Fixed Charge Coverage Ratio test in the first paragraph above, or (b) the Fixed Charge
Coverage Ratio would be no worse than immediately prior thereto;
provided
,
however
, that up to
$100 million in aggregate principal amount of any such Indebtedness may be incurred and outstanding at any time without regard to the previous proviso; and
-
(27)
-
Indebtedness
of a Restricted Subsidiary borrowed from a NMTC Special Purpose Entity in connection with the New Markets Tax Credit program, the funds for which were
loaned to the NMTC Special Purpose Entity by the Company or a Restricted Subsidiary.
For
purposes of determining compliance with this "Incurrence of Indebtedness and Issuance of Preferred Stock" covenant:
-
(1)
-
in
the event that an item of proposed Indebtedness meets the criteria of more than one of the categories of Permitted Debt described in clauses (1) through
(26) above, or is entitled to be incurred pursuant to the first paragraph of this covenant, LifePoint will be permitted to classify and reclassify such item of Indebtedness in any manner that
complies with this covenant. Indebtedness under Credit Facilities outstanding on the date on which notes are first issued and authenticated under the indenture will be deemed to have been incurred on
such date in reliance on the exception provided by clause (1) of the definition of "
Permitted Debt
"; and
-
(2)
-
at
the time of incurrence, LifePoint will be entitled to divide and classify an item of Indebtedness in more than one of the types of Indebtedness described in the
first and second paragraphs above (or any portion thereof) without giving
pro forma
effect to the Indebtedness incurred on such date pursuant to the
second paragraph above (or any portion thereof) when calculating the amount of Indebtedness that may be incurred pursuant to the first paragraph above (or any portion thereof).
Notwithstanding
any other provision of this covenant, the maximum amount of Indebtedness that may be incurred pursuant to this covenant will not be deemed to be exceeded with respect to
any Indebtedness solely as a result of fluctuations in exchange rates or currency values.
Guarantees
of, or obligations in respect of letters of credit relating to, Indebtedness that is otherwise included in the determination of particular amount of Indebtedness shall not be
included in the determination of such amount of Indebtedness;
provided
that the incurrence of the Indebtedness represented by such guarantee or letter
of credit, as the case may be, was in compliance with this covenant.
Liens
LifePoint will not, and will not permit any Restricted Subsidiary to, directly or indirectly, issue, assume or guarantee any Indebtedness
secured by any Lien (other than a Permitted Lien) on any property or asset now owned or hereafter acquired by LifePoint or such Restricted Subsidiary without making effective provision whereby any and
all notes then or thereafter outstanding will be secured by a Lien equally and ratably with or prior to any and all other obligations thereby secured for so long as any such obligations shall be so
secured. Any Lien created for the benefit of the holders of the notes pursuant to the preceding sentence shall provide by its terms that such Lien shall be automatically and unconditionally released
and discharged upon the release and discharge of the initial Lien.
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Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries
LifePoint will not, and will not permit any of its Restricted Subsidiaries to, directly or indirectly, create or permit to exist or become
effective any consensual encumbrance or restriction on the ability of any Restricted Subsidiary to:
-
(1)
-
pay
dividends or make any other distributions on its Capital Stock to LifePoint or any of its Restricted Subsidiaries, or with respect to any other interest or
participation in, or measured by, its profits, or pay any indebtedness owed to LifePoint or any of its Restricted Subsidiaries;
-
(2)
-
make
loans or advances to LifePoint or any of its Restricted Subsidiaries; or
-
(3)
-
transfer
any of its properties or assets to LifePoint or any of its Restricted Subsidiaries.
However,
the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of:
-
(1)
-
agreements
governing Existing Indebtedness and Credit Facilities or other agreements as in effect on the Issue Date and any amendments, modifications, restatements,
renewals, increases, supplements, refundings, replacements or refinancings of those agreements,
provided
that the amendments, modifications,
restatements, renewals, increases, supplements, refundings, replacement or refinancings are not materially more restrictive, taken as a whole, with respect to such dividend and other payment
restrictions than those contained in those agreements on the Issue Date;
-
(2)
-
the
indenture, the notes, the Subsidiary Guarantees, the Exchange Notes and the Exchange Subsidiary Guarantees;
-
(3)
-
applicable
law;
-
(4)
-
any
instrument governing Indebtedness or Capital Stock of a Person, or such encumbrances or restrictions with respect to other property or assets, in any case
acquired by LifePoint or any of its Restricted Subsidiaries as in effect at the time of such acquisition (except to the extent such encumbrances or restrictions relate to Indebtedness was incurred in
connection with or in contemplation of such acquisition),
provided
that, in the case of Indebtedness, such Indebtedness was permitted by the terms of
the indenture to be incurred, and any amendments, modifications, restatements, supplements, renewals, replacements or refinancings thereof that are not materially more restrictive, taken as a whole,
with respect to such encumbrances or restrictions, than those contained in such instruments, encumbrances or restrictions;
-
(5)
-
customary
non-assignment provisions in leases, licenses and other agreements entered into in the ordinary course of business;
-
(6)
-
purchase
money obligations or Capital Lease Obligations for property acquired or leased in the ordinary course of business that impose restrictions on that property
or the assets otherwise subject thereto of the nature described in clause (3) of the preceding paragraph;
-
(7)
-
any
agreement for the sale or other disposition of a Restricted Subsidiary or any assets thereof that restricts distributions by that Restricted Subsidiary pending
the sale or other disposition;
-
(8)
-
Permitted
Refinancing Indebtedness;
provided
that the restrictions contained in the agreements governing such
Permitted Refinancing Indebtedness are not materially more restrictive, taken as a whole, than those contained in the agreements governing the Indebtedness being refinanced;
-
(9)
-
Liens
securing Indebtedness otherwise permitted to be incurred under the provisions of the covenant described above under the caption
"
Liens
";
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-
(10)
-
any
encumbrance or restriction pursuant to customary provisions in joint venture agreements, assets sale agreements, stock sale agreements and other similar
agreements entered into in the ordinary course of business;
-
(11)
-
restrictions
imposed in connection with a financing transaction involving a sale or other disposition of accounts receivable and related assets (including, without
limitation, in connection with a securitization or similar financing) or in connection with a financing involving a subsidiary trust or similar financing vehicle that is permitted by the covenant
described above under the caption "
Incurrence of Indebtedness and Issuance of Preferred Stock
";
provided
that such restrictions do not materially
adversely affect LifePoint's ability to pay interest and principal on the notes when due;
-
(12)
-
restrictions
on cash or other deposits or net worth imposed by customers under contracts entered into in the ordinary course of business or imposed by governmental
agencies or authorities;
-
(13)
-
in
the case of clause (3) of the preceding paragraph, encumbrances or restrictions arising or agreed to in the ordinary course of business, not relating to
Indebtedness and that do not materially detract from the value of the property or assets of LifePoint and its Restricted Subsidiaries;
-
(14)
-
encumbrances
or restrictions contained in the terms of Indebtedness if the encumbrance or restriction is not materially more disadvantageous to Holders than is
customary in comparable financings and will not materially affect LifePoint's ability to make principal or interest payments on the notes (in each case determined by LifePoint in good faith); and
-
(15)
-
agreements
with respect to Insurance Subsidiaries or with respect to securities thereof, in each case in connection with the operation of any Insurance Subsidiary.
Limitation on Sale and Leaseback Transactions
LifePoint will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Leaseback Transaction with respect to any property
or asset unless LifePoint or the Restricted Subsidiary would be entitled to:
-
(1)
-
incur
Indebtedness in an amount equal to the Attributable Debt with respect to such Sale and Leaseback Transaction pursuant to the covenant described above under the
caption "
Incurrence of Indebtedness and Issuance of Preferred Stock
"; and
-
(2)
-
create
a Lien on such property securing such Attributable Debt pursuant to the covenant described above under the caption
"
Liens
";
in
which case, the corresponding Indebtedness and Lien will be deemed incurred pursuant to those provisions.
Merger, Consolidation or Sale of Assets
LifePoint may not, directly or indirectly: (1) consolidate or merge with or into another Person (whether or not LifePoint is the
surviving corporation); or (2) sell, assign, transfer, convey, lease or otherwise dispose of all or substantially all of the properties or assets of LifePoint and its Restricted Subsidiaries
taken as a whole, in one or more related transactions, to another Person; unless:
-
(1)
-
either:
(a) LifePoint is the surviving corporation; or (b) the Person formed by or surviving any such consolidation or merger (if other than LifePoint)
or to which such sale, assignment, transfer, conveyance, lease or other disposition has been made is a Person organized or
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This
"Merger, Consolidation or Sale of Assets" covenant will not apply to a sale, assignment, transfer, conveyance or other disposition of assets between or among LifePoint and any of
the Guarantors.
Upon
any consolidation or merger, or any sale, assignment, transfer, conveyance, transfer, lease or other disposition of all or substantially all of the properties or assets of LifePoint
and its Restricted Subsidiaries, taken as a whole, in accordance with the foregoing provisions, the successor Person formed by such consolidation or into which LifePoint is merged or to which such
sale, assignment, transfer, conveyance, lease or other disposition is made, shall succeed to, and be substituted for, and may exercise every right and power of, LifePoint under the indenture with the
same effect as if such successor had been named as LifePoint therein. When a successor assumes all the obligations of its predecessor under the indenture and the notes following a consolidation or
merger, or any sale, assignment, transfer, conveyance or other disposition (except a lease) of all or substantially all of the assets of the predecessor in accordance with the foregoing provisions,
the predecessor shall be released from those obligations.
Designation of Restricted and Unrestricted Subsidiaries
The Board of Directors of LifePoint may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause
a Default. If a Restricted Subsidiary is designated as an Unrestricted Subsidiary, the aggregate fair market value of all outstanding Investments owned by LifePoint and its Restricted Subsidiaries in
the Subsidiary so designated will be deemed to be an Investment made as of the time of the designation and will reduce the amount available for Restricted Payments under the first paragraph of the
covenant described above under the caption "
Restricted Payments
" or Permitted Investments, as determined by LifePoint. That designation
will only be permitted if the Investment would be permitted at that time and if the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Board of Directors of
LifePoint may re-designate any Unrestricted Subsidiary to be a Restricted Subsidiary if the redesignation would not
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cause
a Default. As of the Issue Date, our Subsidiary, Life Indemnity, LTD, is our only Unrestricted Subsidiary.
Transactions with Affiliates
LifePoint will not, and will not permit any of its Restricted Subsidiaries to, make any payment to, or sell, lease, transfer or otherwise
dispose of any of its properties or assets to, or purchase any property or assets from, or enter into or make or amend any transaction, contract, agreement, understanding, loan, advance or guarantee
with, or for the benefit of, any Affiliate involving aggregate consideration in excess of $5.0 million (each, an "Affiliate Transaction"), unless:
-
(1)
-
the
Affiliate Transaction is on terms that are no less favorable to LifePoint or the relevant Restricted Subsidiary than those that would have been obtained in a
comparable transaction by LifePoint or such Restricted Subsidiary with an unrelated Person; and
-
(2)
-
with
respect to any Affiliate Transaction or series of related Affiliate Transactions involving aggregate consideration in excess of $40 million LifePoint
delivers to the trustee a resolution of LifePoint's Board of Directors set forth in an officers' certificate certifying that such Affiliate Transaction complies with this covenant and that such
Affiliate Transaction has been approved by a majority of the disinterested members of LifePoint's Board of Directors, or an opinion as to the fairness to the Holders of such Affiliate Transaction from
a financial point of view issued by an accounting, appraisal or investment banking firm of national standing in the United States.
The
following items will not be deemed to be Affiliate Transactions and, therefore, will not be subject to the provisions of the prior paragraph:
-
(1)
-
directors'
fees, indemnification and similar arrangements, consulting fees, employee salaries, bonuses or employment agreements, compensation, retirement,
disability, severance or employee benefit arrangements and incentive arrangements with, and loans and advances to, any officer, director or employee in the ordinary course of business;
-
(2)
-
performance
of all agreements in existence on the Issue Date and any modification thereto or any transaction contemplated thereby in any replacement agreement
therefor so long as such modification or replacement is not materially more disadvantageous to LifePoint or any of its Restricted Subsidiaries than the original agreement in effect on the Issue Date;
-
(3)
-
transactions
in connection with a financing transaction involving a sale or other disposition of accounts receivable and related assets (including, without
limitation, in connection with a securitization or similar financing) or in connection with a financing involving a subsidiary trust or similar financing vehicle that is permitted by the covenant
described above under the caption "
Incurrence of Indebtedness and Issuance of Preferred Stock
";
-
(4)
-
transactions
in the ordinary course of business with any joint venture that is otherwise permitted by the indenture;
provided
that such joint venture is between and among LifePoint and/or any of its Subsidiaries on
the one hand and third parties that are not otherwise
Affiliates of LifePoint on the other hand;
-
(5)
-
transactions
between or among LifePoint and/or its Restricted Subsidiaries;
-
(6)
-
transactions
with a Person (other than an Unrestricted Subsidiary) that is an Affiliate of LifePoint solely because LifePoint or a Restricted Subsidiary owns an
Equity Interest in, or controls, such Person;
-
(7)
-
sales
of Equity Interests (other than Disqualified Stock) to Affiliates of LifePoint and the granting of registration and other customary rights in connection
therewith;
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-
(8)
-
Restricted
Payments and Permitted Investments that are permitted by the provisions of the indenture described above under the caption
"
Restricted Payments
";
-
(9)
-
transactions
complying with the covenant described above under the caption "
Merger, Consolidation or Sale of
Assets
";
-
(10)
-
pledges
of Equity Interests of Unrestricted Subsidiaries;
-
(11)
-
any
transaction effected as part of a Qualified Securitization Financing;
-
(12)
-
any
transaction with an Insurance Subsidiary in the ordinary course of business; and
-
(13)
-
transactions
with customers, clients, suppliers, or purchasers or seller of goods or services, in each case in the ordinary course of business and otherwise in
compliance with the terms of the indenture that are fair to LifePoint or its Restricted Subsidiaries, in the reasonable determination of the Board of Directors or the senior management of LifePoint,
or are no less favorable to LifePoint and its Restricted Subsidiaries than could reasonably be expected to be obtained at the time in an arm's-length transaction with a person who was not an
Affiliate.
Additional Subsidiary Guarantees
If LifePoint or any of its Restricted Subsidiaries acquires or creates another Domestic Subsidiary that is a Wholly-Owned Subsidiary after the
Issue Date, other than an Excluded Subsidiary, then that newly acquired or created Domestic Subsidiary that is a Wholly-Owned Subsidiary will become a Guarantor and execute and deliver a supplemental
indenture and deliver an opinion of counsel in form satisfactory to the trustee as promptly as possible after the end of the fiscal quarter in which it was acquired or created.
LifePoint
will not permit any Domestic Subsidiary that is a non-Wholly-Owned Subsidiary to guarantee Indebtedness under the Credit Agreement, any other credit agreement, bank facility,
term loan or any capital markets securities of LifePoint or a Guarantor unless such Restricted Subsidiary executes and delivers a supplemental indenture and delivers an opinion of counsel in form
satisfactory to the trustee as promptly as possible after the end of the fiscal quarter in which it guarantees such Indebtedness providing for a Guarantee by such Restricted
Subsidiary:
-
(a)
-
if
the notes or such Guarantor's Guarantee are subordinated in right of payment to such Indebtedness, the Guarantee under the supplemental indenture shall be
subordinated to such Restricted Subsidiary's guarantee with respect to such Indebtedness substantially to the same extent as the notes are subordinated to such Indebtedness; and
-
(b)
-
if
such Indebtedness is by its express terms subordinated in right of payment to the notes or such Guarantor's Guarantee, any such guarantee by such Restricted
Subsidiary with respect to such Indebtedness shall be subordinated in right of payment to such Guarantee substantially to the same extent as such Indebtedness is subordinated to the notes;
provided
that this covenant shall not be applicable to any guarantee of any Restricted Subsidiary that existed at the time such Person became a
Restricted Subsidiary and was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary.
Any
such Guarantee shall be released as provided under the section entitled "
Subsidiary Guarantees
".
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Reports
Whether or not required by the Commission, so long as any notes are outstanding, LifePoint will furnish to the Holders of notes and the trustee
and file with the Commission (unless the Commission will not accept such filing), within the time periods specified in the Commission's rules and regulations:
-
(1)
-
all
quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K if LifePoint were
required to file such Forms, including a "Management's Discussion and Analysis of Financial Condition and Results of Operations" and, with respect to the annual information only, a report on the
annual financial statements by LifePoint's certified independent accountants; and
-
(2)
-
all
current reports that would be required to be filed with the Commission on Form 8-K if LifePoint were required to file such reports;
provided
that any information in clauses (1) and (2) above that is accepted for filing with the Commission shall be deemed to have been
furnished to Holders of the notes and the trustee.
Events of Default and Remedies
Each of the following is an Event of Default with respect to the notes:
-
(1)
-
default
for 30 days in the payment when due of interest on the notes;
-
(2)
-
default
in payment when due of the principal of, or premium, if any, on the notes (including the failure to repurchase notes pursuant to a Change of Control Offer or
Asset Sale Offer);
-
(3)
-
failure
by LifePoint, any Guarantor or any Significant Subsidiary to comply with the covenants described above under the caption
"
Certain CovenantsMerger, Consolidation or Sale of Assets
";
-
(4)
-
failure
by LifePoint, any Guarantor or any Significant Subsidiary for 60 days after notice to comply with any of the other agreements in the indenture;
-
(5)
-
default
under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed
by LifePoint, any Guarantor or any Significant Subsidiary (or the payment of which is guaranteed by LifePoint, any Guarantor or any Significant Subsidiary) whether such Indebtedness or guarantee now
exists, or is created after the Issue Date, if that default:
-
(a)
-
is
caused by a failure to pay principal of such Indebtedness at its final stated maturity after giving effect to any grace period provided in such Indebtedness on
the date of such default (a "Payment Default"); or
-
(b)
-
results
in the acceleration of such Indebtedness prior to its express maturity, and, in each case, the principal amount of any such Indebtedness, together with the
principal amount of any other such Indebtedness under which there has been a Payment Default or the maturity of which has been so accelerated, aggregates $100 million or more;
-
(6)
-
failure
by LifePoint, any Guarantor or any Significant Subsidiary to pay final, non-appealable judgments aggregating in excess of $100 million that are not
covered by insurance or as to which an insurer has not acknowledged coverage in writing, which judgments are not paid, discharged or stayed for a period of 60 days;
-
(7)
-
except
as permitted by the indenture, any Subsidiary Guarantee of a Significant Subsidiary of notes shall be held in any final, non-appealable judicial proceeding to
be unenforceable or invalid or shall cease for any reason to be in full force and effect or any Guarantor that is a
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A
Default under clause (4) is not an Event of Default in respect of the notes until the trustee or the Holders of at least 25% in principal amount of the notes then outstanding
notify LifePoint and the trustee (in the case of a notice given by holders) of the Default and LifePoint does not cure such default within the time specified after receipt of such notice. Such notice
must specify the Default, demand that it be remedied and state that such notice is a "
Notice of Default
."
In
the case of an Event of Default arising from certain events of bankruptcy or insolvency with respect to LifePoint, all outstanding notes will become due and payable immediately
without further action or
notice. If any other Event of Default occurs and is continuing, the trustee or the Holders of at least 25% in principal amount of the then outstanding notes may declare all the notes to be due and
payable immediately.
Holders
of the notes may not enforce the indenture or the notes except as provided in the indenture. Subject to certain limitations, Holders of a majority in principal amount of the then
outstanding notes may direct the trustee in its exercise of any trust or power. The trustee may withhold from Holders of the notes notice of any continuing Default or Event of Default if it determines
that withholding notice is in their interest, except a Default or Event of Default relating to the payment of principal or interest.
The
Holders of a majority in aggregate principal amount of the notes then outstanding by notice to the trustee may on behalf of the Holders of all of the notes waive any existing Default
or Event of Default and its consequences under the indenture except a continuing Default or Event of Default in the payment of interest or premium on, or the principal of, the notes.
LifePoint
is required to deliver to the trustee annually a statement regarding compliance with the indenture. Upon becoming aware of any Default or Event of Default, LifePoint is
required to deliver to the trustee a statement specifying such Default or Event of Default.
No Personal Liability of Directors, Officers, Employees and Stockholders
No director, officer, employee, incorporator or stockholder of LifePoint or any Guarantor, as such, will have any liability for any obligations
of LifePoint or the Guarantors under the notes, the indenture, the Subsidiary Guarantees, or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder of
notes by accepting a note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the notes. The waiver may not be effective to waive liabilities
under the federal securities laws.
Legal Defeasance and Covenant Defeasance
LifePoint may, at its option and at any time, elect to have all of its obligations discharged with respect to the outstanding notes and all
obligations of the Guarantors discharged with respect to their Subsidiary Guarantees ("Legal Defeasance") except for:
-
(1)
-
the
rights of Holders of outstanding notes to receive payments in respect of the principal of, or interest or premium on, such notes when such payments are due from
the trust referred to below;
-
(2)
-
LifePoint's
obligations with respect to the notes concerning issuing temporary notes, registration of notes, mutilated, destroyed, lost or stolen notes and the
maintenance of an office or agency for payment and money for security payments held in trust;
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-
(3)
-
the
rights, powers, trusts, duties and immunities of the trustee, and LifePoint's and the Guarantor's obligations in connection therewith; and
-
(4)
-
the
Legal Defeasance provisions of the indenture.
In
addition, LifePoint may, at its option and at any time, elect to have the obligations of LifePoint and the Guarantors released with respect to certain covenants that are described in
the indenture ("Covenant Defeasance") and thereafter any omission to comply with those covenants will not constitute a Default or Event of Default with respect to the notes. In the event Covenant
Defeasance occurs in respect of the notes, certain events (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events with respect to LifePoint) described under
"
Events of Default and Remedies
" will no longer constitute an Event of Default with respect to the notes.
In
order to exercise either Legal Defeasance or Covenant Defeasance:
-
(1)
-
LifePoint
must irrevocably deposit with the trustee, in trust, for the benefit of the Holders of the notes, cash in U.S. dollars sufficient, non-callable Government
Securities, the scheduled payments of principal of and interest on which will be sufficient, or a combination of cash in U.S. dollars and non-callable Government Securities, the scheduled payments of
principal of and interest on which will together with such cash be sufficient, without consideration of any reinvestment of interest, to pay the principal of, or interest and premium on, the
outstanding notes on the stated maturity or on the applicable redemption date, as the case may be, and LifePoint must specify whether such notes are being defeased to maturity or to a particular
redemption date;
-
(2)
-
in
the case of Legal Defeasance, LifePoint has delivered to the trustee an opinion of counsel in form reasonably acceptable to the trustee confirming that
(a) LifePoint has received from, or there has been published by, the Internal Revenue Service a ruling or (b) since the Issue Date, there has been a change in the applicable federal
income tax law, in either case to the effect that, and based thereon such opinion of counsel will confirm that, the Holders of the outstanding notes will not recognize income, gain or loss for federal
income tax purposes as a result of such Legal Defeasance and will be subject to federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such
Legal Defeasance had not occurred;
-
(3)
-
in
the case of Covenant Defeasance, LifePoint has delivered to the trustee an opinion of counsel in form reasonably acceptable to the trustee confirming that the
Holders of the outstanding notes will not recognize income, gain or loss for federal income tax purposes as a result of such Covenant Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;
-
(4)
-
no
Default or Event of Default has occurred and is continuing on the date of such deposit (other than a Default or Event of Default resulting from the borrowing of
funds to be applied to such deposit and the grant of any Lien securing such borrowing);
-
(5)
-
such
Legal Defeasance or Covenant Defeasance will not result in a breach or violation of, or constitute a default under any material agreement or instrument (other
than the indenture and the agreements governing any other Indebtedness being defeased, discharged or replaced) to which LifePoint or any of its Subsidiaries is a party or by which LifePoint or any of
its Subsidiaries is bound;
-
(6)
-
LifePoint
must deliver to the trustee an officers' certificate stating that the deposit was not made by LifePoint with the intent of preferring the Holders of notes
over the other creditors
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Notwithstanding
the foregoing, the opinion of counsel required by clause (2) above with respect to a Legal Defeasance need not be delivered if all notes not theretofore delivered
to the trustee for cancellation (i) have become due and payable or (ii) will become due and payable on the maturity date or on a redemption date within one year (in the case of a
redemption) under arrangements satisfactory to the trustee for the giving of notice of redemption by the trustee in the name, and at the expense, of LifePoint.
Amendment, Supplement and Waiver
Except as provided in the next two succeeding paragraphs, the indenture or the notes may be amended or supplemented with the consent of the
Holders of at least a majority in principal amount of the notes then outstanding (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer
for, notes), and any existing default or compliance with any provision of the indenture or the notes may be waived with the consent of the
Holders of a majority in principal amount of the then outstanding notes (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for,
notes).
Without
the consent of each Holder affected, an amendment or waiver may not (with respect to any notes held by a non-consenting Holder):
-
(1)
-
reduce
the principal amount of notes whose Holders must consent to an amendment, supplement or waiver;
-
(2)
-
reduce
the principal of or change the fixed maturity of any note or alter the provisions with respect to the redemption of the notes (other than provisions relating
to the covenants described above under the caption "
Repurchase at the Option of Holders
" and other than notice provisions with respect to
any optional redemption by LifePoint);
-
(3)
-
reduce
the rate of or change the time for payment of interest on any note;
-
(4)
-
waive
a Default or Event of Default in the payment of principal of, or interest or premium on, the notes (except a rescission of acceleration of the notes by the
Holders of at least a majority in aggregate principal amount of the notes and a waiver of the payment default in respect of the notes that resulted from such acceleration);
-
(5)
-
make
any note payable in money other than that stated in the notes;
-
(6)
-
make
any change in the provisions of the indenture relating to waivers of past Defaults or the rights of Holders of notes to receive payments of principal of, or
interest or premium on, the notes;
-
(7)
-
after
the date of an event giving rise to a redemption, waive a redemption payment with respect to any note (other than a payment required by one of the covenants
described above under the caption "
Repurchase at the Option of Holders
");
-
(8)
-
release
any Guarantor from any of its obligations under its Subsidiary Guarantee or the indenture, except in accordance with the terms of the indenture; or
-
(9)
-
make
any change in the preceding amendment and waiver provisions.
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Notwithstanding
the preceding, without the consent of any Holder of notes, LifePoint, the Guarantors, if applicable, and the trustee may amend or supplement the indenture or the
notes:
-
(1)
-
to
cure any ambiguity, defect or inconsistency;
-
(2)
-
to
provide for uncertificated notes in addition to or in place of certificated notes;
-
(3)
-
to
provide for the assumption of LifePoint's or a Guarantor's obligations to Holders of notes in the case of a merger or consolidation or sale of all or
substantially all of LifePoint's or a Guarantor's assets;
-
(4)
-
to
make any change that would provide any additional rights or benefits to the Holders of notes or that does not adversely affect the legal rights under the
indenture of any such Holder;
-
(5)
-
to
comply with requirements of the Commission in order to effect or maintain the qualification of the indenture under the Trust Indenture Act;
-
(6)
-
to
allow any Guarantor to execute a supplemental indenture and/or a Subsidiary Guarantee with respect to the notes;
-
(7)
-
to
evidence and provide the acceptance of the appointment of a successor trustee under the indenture;
-
(8)
-
to
mortgage, pledge, hypothecate or grant a security interest in favor of the trustee for the benefit of the Holders of notes as additional security for the payment
and performance of LifePoint's or a Guarantor's obligations;
-
(9)
-
to
release a Guarantor from its Subsidiary Guarantee pursuant to the terms of the indenture when permitted or required pursuant to the terms of the indenture; or
-
(10)
-
to
conform the text of the indenture, the notes or the Subsidiary Guarantees to any provision of this Description of the Exchange Notes to the extent that such
provision in this Description of the Exchange Notes was intended to be a substantially verbatim recitation of a provision of the indenture, the notes or the Subsidiary Guarantees.
The
consent of the Holders is not necessary under the indenture to approve the particular form of any proposed amendment. It is sufficient if such consent approves the substance of the
proposed amendment.
Satisfaction and Discharge
The indenture will be discharged and will cease to be of further effect as to all notes issued thereunder, when:
-
(1)
-
either:
-
(a)
-
all
notes that have been authenticated, except lost, stolen or destroyed notes that have been replaced or paid and notes for whose payment money has been deposited
in trust and thereafter repaid to LifePoint, have been delivered to the trustee for cancellation; or
-
(b)
-
all
notes that have not been delivered to the trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or otherwise or
will become due and payable within one year and LifePoint or any Guarantor has irrevocably deposited or caused to be deposited with the trustee as trust funds in trust solely for the benefit of the
Holders of notes, cash in U.S. dollars, non-callable Government Securities, the scheduled payments of principal of and interest on which will be sufficient, or a combination of cash in U.S. dollars
and noncallable Government Securities, the scheduled
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payments
of principal of and interest on which will, together with such cash, be sufficient, without consideration of any reinvestment of interest, to pay and discharge the entire indebtedness on the
notes not delivered to the trustee for cancellation for principal, premium and accrued interest to the date of maturity or redemption;
-
(2)
-
LifePoint
or any Guarantor has paid or caused to be paid all sums payable by it under the indenture with respect to the notes; and
-
(3)
-
LifePoint
has delivered irrevocable instructions to the trustee under the indenture to apply the deposited money toward the payment of the notes at maturity or the
redemption date, as the case may be.
In
addition, LifePoint must deliver an officers' certificate and an opinion of counsel to the trustee stating that all conditions precedent to satisfaction and discharge have been
satisfied or waived.
Concerning the Trustee
If the trustee becomes a creditor of LifePoint or any Guarantor, the indenture limits its right to obtain payment of claims in certain cases, or
to realize on certain property received in respect of any such claim as security or otherwise. The trustee will be permitted to engage in other transactions; however, if it acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the Commission for permission to continue or resign.
The
Holders of a majority in principal amount of the then outstanding notes will have the right to direct the time, method and place of conducting any proceeding for exercising any
remedy available to the trustee, subject to certain exceptions. The indenture provides that in case an Event of Default occurs and is continuing, the trustee will be required, in the exercise of its
power, to use the degree of care of a prudent person in the conduct of such person's own affairs. Subject to such provisions, the trustee will be under no obligation to exercise any of its rights or
powers under the indenture at the request of any Holder of notes, unless such Holder has offered to the trustee security and indemnity satisfactory to it against any loss, liability or expense.
Anyone
who receives this prospectus supplement may obtain a copy of the indenture without charge by writing to LifePoint Health, Inc., 330 Seven Springs Way, Brentwood, Tennessee
37027, Attention: Investor Relations.
Certain Definitions
Set forth below are certain defined terms used in the indenture. Reference is made to the indenture for a full disclosure of all such terms, as
well as any other capitalized terms used herein for which no definition is provided.
"
Acquired Debt
" means, with respect to any specified Person Indebtedness of any other Person existing at the time such other Person is
merged with or into or became a Restricted Subsidiary of such specified Person, whether or not such Indebtedness is incurred in connection with, or in contemplation of, such other Person merging with
or into, or becoming a Restricted Subsidiary of, such specified Person.
"
Affiliate
" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect
common control with such specified Person. For purposes of this definition, "
control
," as used with respect to any Person, means the possession,
directly or indirectly, of the power to direct or cause the direction of the management or policies of such Person, whether through the ownership of voting securities, by agreement or otherwise. For
purposes of this definition, the terms "
controlling
," "
controlled by
" and "
under
common control with
" have correlative meanings.
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"
Applicable Redemption Premium
" means, with respect to any note on any redemption date, the excess of
-
(1)
-
the
present value at such redemption date of the redemption price of such note if such note were redeemed on May 1, 2018 plus all required interest payments
due on such note through May 1, 2018 (not including any portion of such payments of interest accrued to the redemption date) computed using a discount rate equal to the Treasury Rate at such
redemption date plus 50 basis points, over
-
(2)
-
the
then-outstanding principal amount of the note.
"
Asset Sale
" means:
-
(1)
-
the
sale, lease, conveyance or other disposition by LifePoint or any of its Restricted Subsidiaries of any assets, other than sales of products and services in the
ordinary course of business consistent with past practices;
provided
that the sale, conveyance or other disposition of all or substantially all of the
assets of LifePoint and its Restricted Subsidiaries taken as a whole will be governed by the covenant described above under the caption "
Repurchase at the Option
of HoldersChange of control
" and/or the covenant described above under the caption "
Certain CovenantsMerger,
Consolidation or Sale of Assets
" and not by the provisions of the Asset Sale covenant; and
-
(2)
-
the
issuance of Equity Interests (other than directors' qualifying shares) by any Restricted Subsidiary or the sale of Equity Interests in any Restricted Subsidiary.
Notwithstanding
the preceding, the following items will not be deemed to be Asset Sales:
-
(1)
-
any
single transaction or series of related transactions that involves assets having a fair market value of less than $75 million;
-
(2)
-
a
transfer of assets between or among LifePoint and one or more Restricted Subsidiaries;
-
(3)
-
an
issuance of Equity Interests by a Restricted Subsidiary to LifePoint or to another Restricted Subsidiary;
-
(4)
-
the
sale, lease, assignment, sublease or other disposition of equipment, inventory, accounts receivable or other assets in the ordinary course of business;
-
(5)
-
the
sale or other disposition of cash or Cash Equivalents;
-
(6)
-
a
Restricted Payment (or Payment that would constitute a Restricted Payment but for the exclusions from the definition thereof) or Permitted Investment that is
permitted by the covenant described above under the caption "
Certain CovenantsRestricted Payments
";
-
(7)
-
a
sale or other disposition of accounts receivable and related assets in connection with a financing transaction involving such assets (including, without
limitation, in connection with a securitization or similar financing);
-
(8)
-
any
disposition of property in the ordinary course of business by LifePoint or any Restricted Subsidiary that, in the good faith judgment of management of LifePoint,
has become obsolete, worn out, damaged or no longer useful in the conduct of the business of LifePoint or the Restricted Subsidiaries;
-
(9)
-
any
Asset Swap;
-
(10)
-
any
sale of securities constituting Equity Interests that are issued by a subsidiary trust or other financing vehicle in a transaction permitted by the covenant
described above under the caption "
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
";
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-
(11)
-
the
discount or forgiveness of accounts receivable in the ordinary course of business in connection with the collection or compromise thereof;
-
(12)
-
licenses
and sublicenses by LifePoint or any of its Restricted Subsidiaries of software or intellectual property in the ordinary course of business or consistent
with past practice;
-
(13)
-
a
Sale and Leaseback Transaction;
provided
that at least 75% of the consideration paid to LifePoint or the
Restricted Subsidiary for such Sale and Leaseback Transaction consists of cash received at closing;
-
(14)
-
the
sale, transfer or other disposition of Hedging Obligations incurred pursuant to the covenant described above under the caption
"
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
";
-
(15)
-
the
creation of any Permitted Lien and dispositions in connection with Permitted Liens;
-
(16)
-
dispositions
of assets resulting from the assertion by federal, state or local governmental authorities (or similarly empowered Persons) of rights of eminent
domain, condemnation or expropriation or similar rights;
-
(17)
-
long-term
leases of Hospitals to another Person;
provided
that the aggregate book value of all such properties
subject to such leases does not exceed 10% of the Total Assets of LifePoint;
-
(18)
-
sales
of assets received by LifePoint or any of its Restricted Subsidiaries upon the foreclosure on a Lien;
-
(19)
-
the
disposition of Receivables and Related Assets in a Qualified Securitization Transaction; and
-
(20)
-
the
disposition of Capital Stock or Indebtedness or other securities of an Unrestricted Subsidiary.
"
Asset Sale Offer
" has the meaning set forth in the covenant described above under the caption
"
Repurchase at the Option of HoldersAsset Sales
."
"
Asset Swap
" means an exchange by LifePoint or any Restricted Subsidiary of property or assets for property or assets of another Person;
provided
that (i) LifePoint
or the applicable Restricted Subsidiary, as the case may be, receives consideration at the time of such exchange at
least equal to the fair market value of the assets or other property sold, issued or otherwise disposed of (as evidenced by a resolution of LifePoint's Board of Directors), and (ii) at least
75% of the consideration received in such exchange constitutes assets or other property of a kind usable by LifePoint and its Restricted Subsidiaries in a Permitted Business;
provided
,
further
, that any cash and Cash Equivalents received by LifePoint or any of its Restricted
Subsidiaries in connection with such an exchange shall constitute Net Proceeds subject to the provisions under "
Repurchase at the Option of HoldersAsset
Sales
."
"
Attributable Debt
" means, in respect of a Sale and Leaseback Transaction, the present value, discounted at the interest rate implicit in
the Sale and Leaseback Transaction, of the total obligations of the lessee for rental payments during the remaining term of the lease in the Sale and Leaseback Transaction.
"
Beneficial Owner
" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in
calculating the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person" will be deemed to have beneficial ownership of all
securities that such "person" has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a
subsequent condition. The terms "Beneficially Owns" and "Beneficially Owned" have a corresponding meaning.
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"
Board of Directors
" means:
-
(1)
-
with
respect to a corporation, the board of directors of the corporation (or any duly authorized committee thereof);
-
(2)
-
with
respect to a partnership, the Board of Directors (or any duly authorized committee thereof) of the general partner of the partnership;
-
(3)
-
with
respect to a limited liability company, the managing member or members or any controlling committee of managing members thereof; and
-
(4)
-
with
respect to any other Person, the board or committee of such Person serving a similar function.
"
Capital Lease Obligation
" means, at the time any determination is to be made, the amount of the liability in respect of a capital lease
that would at that time be required to be capitalized on a balance sheet in accordance with GAAP.
"
Capital Stock
" means:
-
(1)
-
in
the case of a corporation, corporate stock;
-
(2)
-
in
the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;
-
(3)
-
in
the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and
-
(4)
-
any
other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing
Person.
"
Cash Equivalents
" means:
-
(1)
-
United
States dollars;
-
(2)
-
Securities
constituting direct obligations of the United States or any agency or instrumentality of the United States, the payment or guarantee of which constitutes
a full faith and credit obligation of the United States, maturing in three years or less from the date of acquisition thereof;
-
(3)
-
securities
constituting direct obligations of any State or municipality within the United States maturing in three years or less form the date of acquisition thereof
which, in any such case, at the time of acquisition by LifePoint or any Restricted Subsidiary, is accorded one of the two highest long-term or short-term, as applicable, debt ratings by S&P or Moody's
or any other United States nationally recognized credit rating agency of similar standing;
-
(4)
-
certificates
of deposit with a maturity of one year or less or bankers' acceptances issued by a bank or trust company having capital, surplus and undivided profits
aggregating at least $500 million and having a short-term unsecured debt rating of at least "P-1" by Moody's or "A-1" by S&P;
-
(5)
-
eurodollar
time deposits with maturities of one year or less and overnight bank deposits with any bank or trust company having capital, surplus and undivided profits
aggregating at least $500 million and having a short-term unsecured debt rating of at least "P-1" by Moody's or "A-1" by S&P;
-
(6)
-
repurchase
obligations with a term of not more than thirty days for underlying securities of the types described in clauses (2), (3), (4) and
(5) above entered into with any financial institution meeting the qualifications specified in such clauses above;
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-
(7)
-
commercial
paper maturing in 365 days or less from the date of issuance which, at the time of acquisition by LifePoint or any Restricted Subsidiary, is
accorded a rating of "A2" or better by S&P or "P2" or better by Moody's or any other United States nationally recognized credit rating agency of similar standing; and
-
(8)
-
any
fund or other pooling arrangement at least 95% of the assets of which constitute Investments described in clauses (1) through (7) of this
definition.
"
Change of Control
" means the occurrence of any of the following:
-
(1)
-
the
direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or a series of related transactions, of
all or substantially all of the assets of LifePoint and its Restricted Subsidiaries taken as a whole to any "person" (as that term is used in Section 13(d)(3) of the Exchange Act);
-
(2)
-
the
adoption of a plan relating to the liquidation or dissolution of LifePoint; or
-
(3)
-
LifePoint
becomes aware of (by way of a report or other filing pursuant to Section 13(d) of the Exchange Act, proxy, written notice or otherwise) the
consummation of any transaction (including, without limitation, any merger or consolidation) the result of which is that any "person" (as defined above), becomes the Beneficial Owner, directly or
indirectly, of more than 50% of the Voting Stock of LifePoint, measured by voting power rather than number of shares.
"
Code
" means the Internal Revenue Code of 1986, as amended.
"
Consolidated
" means, when used with reference to financial statements or financial statement items of any Person, such statements or
items on a consolidated basis in accordance with applicable principles of consolidation under GAAP.
"
Consolidated Assets
" of any Person as of any date means the total assets of such Person and its Restricted Subsidiaries on a consolidated
basis at such date, as determined in accordance with GAAP.
"
Consolidated Cash Flow
" means, with respect to any specified Person for any period, the Consolidated Net Income of such Person for such
period
plus
:
-
(1)
-
an
amount equal to any extraordinary, unusual or non-recurring loss, expense or charge plus any net loss realized by such Person or any of its Restricted
Subsidiaries in connection with an Asset Sale (without regard to the dollar limitation in the definition thereof), to the extent such losses, expenses or charges were deducted in computing such
Consolidated Net Income;
plus
-
(2)
-
provision
for taxes based on income or profits of such Person and its Restricted Subsidiaries for such period, to the extent that such provision for taxes was
deducted in computing such Consolidated Net Income;
plus
-
(3)
-
consolidated
interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued and whether or not capitalized (including,
without limitation, amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of
all payments associated with Capital Lease Obligations, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the
effect of all payments made or received pursuant to Hedging Obligations), to the extent that any such expense was deducted in computing such Consolidated Net Income;
plus
-
(4)
-
depreciation,
amortization (including amortization of goodwill and other intangibles but excluding amortization of prepaid cash expenses that were paid in a prior
period) and other
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non-cash
expenses (excluding any such non-cash expense to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense that
was paid in a prior period) of such Person and its Restricted Subsidiaries for such period to the extent that such depreciation, amortization and other non-cash expenses were deducted in computing
such Consolidated Net Income;
plus
-
(5)
-
severance
payments, other employee termination benefits or relocation costs, expenses or charges, non-cash stock-based compensation expense, and net income
attributable to non-controlling interests in LifePoint's non-wholly-owned Subsidiaries;
minus
-
(6)
-
any
amortization of discounts of convertible debt instruments resulting from the application of APB 14-1 "
Accounting for Convertible
Debt Instruments
";
minus
-
(7)
-
non-cash
items increasing such Consolidated Net Income for such period, other than the accrual of revenue in the ordinary course of business,
in
each case, on a consolidated basis and determined in accordance with GAAP.
Notwithstanding
the preceding, the provision for taxes based on the income or profits of, and the depreciation and amortization and other non-cash expenses of, a Restricted Subsidiary
will be added to Consolidated Net Income to compute Consolidated Cash Flow of LifePoint only to the extent that a corresponding amount would be permitted at the date of determination to be dividended
to LifePoint by such Restricted Subsidiary without prior governmental approval (that has not been obtained), pursuant to the terms of its charter and all agreements, instruments, judgments, decrees,
orders, statutes, rules and governmental regulations applicable to that Restricted Subsidiary or its stockholders.
"
Consolidated Net Income
" means, with respect to any specified Person for any period, the aggregate of the Net Income of such Person and
its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP;
provided
that:
-
(1)
-
the
Net Income (but not loss) of any Person that is not a Restricted Subsidiary or that is accounted for by the equity method of accounting will be included only to
the extent of the amount of dividends or distributions paid in cash to the specified Person or a Restricted Subsidiary of the Person;
-
(2)
-
the
Net Income of any Restricted Subsidiary will be excluded to the extent that the declaration or payment of dividends or similar distributions by that Restricted
Subsidiary of that Net Income is not at the date of determination permitted without any prior governmental approval (that has not been obtained) or, directly or indirectly, by operation of the terms
of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Restricted Subsidiary or its stockholders;
-
(3)
-
for
purposes of the covenant described above under the caption "
Certain CovenantsRestricted
Payments
", the Net Income of any Person acquired in a pooling of interests transaction for any period prior to the date of such acquisition will be excluded; and
-
(4)
-
the
cumulative effect of a change in accounting principles will be excluded.
"
Consolidated Secured Debt Ratio
" as of the date of any event for which a calculation is required (the "date of determination") means the
ratio of (a) (i) the aggregate amount of all Indebtedness of LifePoint and its Restricted Subsidiaries that is secured by Liens as of the date of determination
minus
(ii) the unrestricted cash
and Cash Equivalents of LifePoint and its Restricted Subsidiaries on a Consolidated basis as of the date of
determination to (b) the Consolidated Cash Flow of LifePoint for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding
the date of determination, in each case with such
pro forma
adjustments as are appropriate and consistent with the
pro
forma
adjustment provisions set forth in the definition of
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"Fixed
Charge Coverage Ratio";
provided
that LifePoint may elect pursuant to an officers' certificate delivered to the trustee to treat all or any
portion of the commitment (such amount elected, the "Elected Amount") under such Indebtedness secured by Liens as being incurred at such time, in which case (i) any subsequent incurrence of
such Indebtedness secured by Liens under such commitment shall not be deemed, for purposes of this calculation, to be an incurrence at such subsequent time and (ii) for purposes of all
subsequent calculations of the Consolidated Secured Debt Ratio at any time during which such commitment remains effective, the Elected Amount shall be deemed to be outstanding, whether or not such
amount is actually outstanding.
"
Consolidated Senior Leverage Ratio
" means, as of the date of determination, the ratio (x) of (i) the aggregate amount of
all Indebtedness (other than Subordinated Indebtedness) of LifePoint and its Restricted Subsidiaries and preferred stock of Restricted Subsidiaries that are not Guarantors as of the date of the
determination
minus
(ii) the unrestricted cash and Cash Equivalents of LifePoint and its Restricted Subsidiaries on a Consolidated basis as of
the date of determination to (y) the Consolidated Cash Flow of LifePoint for the most recently ended four full fiscal quarters for which internal financial statements are available immediately
preceding the date of determination, in each case with such
pro forma
adjustments as are appropriate and consistent with the
pro
forma
adjustment provisions set forth in the definition of "Fixed Charge Coverage Ratio."
"
Consolidated Total Leverage Ratio
" means, as of the date of determination, the ratio (x) of (i) the aggregate amount of all
Indebtedness of LifePoint and its Restricted Subsidiaries and preferred stock of Restricted Subsidiaries that are not Guarantors as of the date of the determination
minus
(ii) the unrestricted cash
and Cash Equivalents of LifePoint and its restricted Subsidiaries on a Consolidated basis as of the date of
determination to (y) the Consolidated Cash Flow of LifePoint for the most recently ended four full fiscal quarters for which internal financial statements are available immediately preceding
the date of determination, in each case with such
pro forma
adjustments as are appropriate and consistent with the
pro
forma
adjustment provisions set forth in the definition of "Fixed Charge Coverage Ratio."
"
Credit Agreement
" means the Credit Agreement, dated as of July 24, 2012, by and among LifePoint, as borrower, the lenders parties
thereto, Citibank, N.A., as administrative agent, Bank of America, N.A., and Barclays Bank PLC, as co-syndication agents and Citigroup Global Markets Inc., Merrill Lynch, Pierce,
Fenner & Smith Incorporated and Barclays Bank PLC as lead arrangers and bookrunners, including any related notes, guarantees, collateral documents, instruments and agreements executed in
connection therewith, and in each case, as amended and as further amended (including, without limitation, as to principal amount), modified, renewed, refunded, replaced or refinanced from time to time
(whether or not with the original agents or lenders and whether or not contemplated under the original agreement relating thereto).
"
Credit Facilities
" means one or more debt facilities (including, without limitation, the Credit Agreement), note purchase agreements,
commercial paper facilities or indentures, in each case with
banks, institutional or other lenders or a trustee providing for revolving credit loans, term loans, receivables financing (including through the sale of receivables to such lenders or to special
purpose entities formed to borrow from such lenders against such receivables), letters of credit or debt securities, in each case, as amended (including, without limitation, as to principal amount),
restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time (whether or not with the original agents or lenders or parties and whether or not contemplated under
the original agreement relating thereto).
"
Default
" means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.
"
Designated Non-cash Consideration
" means any non-cash consideration received by LifePoint or one of its Restricted Subsidiaries in
connection with an Asset Sale that is designated as Designated
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Non-cash
Consideration pursuant to an officers' certificate executed by the principal financial officer and any of the other executive officers of LifePoint or such Restricted Subsidiary at the time
of such Asset Sale. Any particular item of Designated Non-cash Consideration will cease to be considered to be outstanding once it has been sold for cash or Cash Equivalents.
"
Disqualified Stock
" means any Capital Stock that, by its terms (or by the terms of any security into which it is convertible, or for
which it is exchangeable, in each case at the option of the holder of the Capital Stock), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the holder of the Capital Stock, in whole or in part, on or prior to the date that is 91 days after the date on which the notes mature.
Notwithstanding the preceding sentence, any Capital Stock that would constitute Disqualified Stock solely because the holders of the Capital Stock have the right to require LifePoint to repurchase
such Capital Stock upon the occurrence of a change of control with respect to LifePoint or an asset sale by LifePoint or its Restricted Subsidiaries will not constitute Disqualified Stock if the terms
of such Capital Stock provide that LifePoint may not repurchase or redeem any such Capital Stock pursuant to such provisions unless such repurchase or redemption complies with the covenant described
above under the caption "
Certain CovenantsRestricted Payments
."
"
Domestic Subsidiary
" means any Restricted Subsidiary organized under the laws of the United States or any state of the United States or
the District of Columbia.
"
Equity Interests
" means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security
that is convertible into, or exchangeable for, Capital Stock).
"
Equity Offering
" means any public or private sale by LifePoint for cash of its common stock or preferred stock (excluding Disqualified
Stock).
"
Excess Proceeds
" has the meaning set forth in the covenant described above under the caption
"
Repurchase at the Option of HoldersAsset Sales
."
"
Exchange Notes
" means the debt securities of LifePoint issued pursuant to the indenture in exchange for the notes in compliance with the
terms of the Registration Rights Agreement.
"
Exchange Subsidiary Guarantees
" means the guarantees of the obligation of LifePoint under the Indenture and the notes issued pursuant to
the indenture in exchange for the Subsidiary Guarantees in compliance with the terms of the Registration Rights Agreement.
"Excluded Subsidiaries
" means those Domestic Subsidiaries which are Wholly Owned Subsidiaries that are designated by LifePoint as Domestic
Subsidiaries that will not be Guarantors;
provided
,
however
, that in no event will the Excluded
Subsidiaries, either individually or collectively, hold more than 4.5% of the consolidated assets of LifePoint and its Domestic Subsidiaries as of the end of any fiscal quarter (determined as of the
most recent fiscal quarter for which LifePoint has internal financial statements available);
provided
,
further
, that any Subsidiary that guarantees
Indebtedness under the Credit Agreement, any other credit agreement, bank facility, term loan or any
capital markets securities of LifePoint or a Guarantor may not be designated as or continue to be an Excluded Subsidiary. In the event any Subsidiaries, individually or collectively, previously
designated as Excluded Subsidiaries cease to meet the requirements of the previous sentence, LifePoint will, within 60 calendar days following such event, cause one or more of such Subsidiaries to
become Guarantors so that the requirements of the previous sentence are complied with.
"
Existing Indebtedness
" means Indebtedness of LifePoint and its Restricted Subsidiaries (other than Indebtedness under the Credit
Agreement) in existence on the Issue Date, until such amounts are repaid.
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"
Fixed Charges
" means, with respect to any specified Person for any period, the sum, without duplication, of:
-
(1)
-
the
consolidated interest expense of such Person and its Restricted Subsidiaries for such period, whether paid or accrued, including, without limitation,
amortization of debt issuance costs and original issue discount, non-cash interest payments, the interest component of any deferred payment obligations, the interest component of all payments
associated with Capital Lease Obligations, commissions, discounts and other fees and charges incurred in respect of letter of credit or bankers' acceptance financings, and net of the effect of all
payments made or received pursuant to Hedging Obligations;
plus
-
(2)
-
the
consolidated interest of such Person and its Restricted Subsidiaries that was capitalized during such period;
plus
-
(3)
-
any
interest expense on Indebtedness of another Person that is Guaranteed by such Person or one of its Restricted Subsidiaries or secured by a Lien on assets of such
Person or one of its Restricted Subsidiaries, to the extent such Guarantee or Lien is called upon;
plus
-
(4)
-
the
product of (a) all dividends, whether paid or accrued and whether or not in cash, on any series of preferred stock of such Person or any of its Restricted
Subsidiaries, other than dividends on Equity Interests payable solely in Equity Interests of LifePoint (other than Disqualified Stock) or to LifePoint or a Restricted Subsidiary, times (b) a
fraction, the numerator of which is one and the denominator of which is one minus the then current combined federal, state and local statutory tax rate of such Person, expressed as a decimal, in each
case, on a consolidated basis and in accordance with GAAP;
minus
-
(5)
-
any
amortization of discounts of convertible debt instruments resulting from the application of APB 14-1 "
Accounting for Convertible
Debt Instruments
."
"
Fixed Charge Coverage Ratio
" means with respect to any specified Person for any period, the ratio of the Consolidated Cash Flow of such
Person for such period to the Fixed Charges of such Person for such period. In the event that the specified Person or any of its Restricted Subsidiaries incurs, assumes, Guarantees, repays,
repurchases or redeems any Indebtedness (other than ordinary working capital borrowings) or issues, repurchases or redeems preferred stock subsequent to the commencement of the period for which the
Fixed Charge Coverage Ratio is being calculated and on or prior to the date on
which the event for which the calculation of the Fixed Charge Coverage Ratio is made (the "Calculation Date"), then the Fixed Charge Coverage Ratio will be calculated giving
pro forma
effect to such
incurrence, assumption, Guarantee, repayment, repurchase or redemption of Indebtedness, or such issuance, repurchase or
redemption of preferred stock, and the use of the proceeds therefrom as if the same had occurred at the beginning of the applicable four-quarter reference period.
In
addition, for purposes of calculating the Fixed Charge Coverage Ratio,
pro forma
effect will be given to:
-
(1)
-
acquisitions
of any operations or businesses or assets that have been made by the specified Person or any of its Restricted Subsidiaries, including through purchases
or through mergers or consolidations and including any related financing transactions, during the four-quarter reference period or subsequent to such reference period and on or prior to the
Calculation Date, as if they had occurred on the first day of the four-quarter reference period; and
-
(2)
-
the
discontinuance of operations or businesses and dispositions of operations or businesses or assets during the four quarter reference period or subsequent to such
reference period and on or prior to the Calculation Date, as if they had occurred on the first day of the four quarter reference period.
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If
any Indebtedness bears a floating rate of interest and is being given
pro forma
effect, the interest on such Indebtedness shall be
calculated as if the rate in effect on the Calculation Date had been the applicable rate for the entire period. Interest on a Capital Lease Obligation shall be deemed to accrue at an interest rate
reasonably determined by a responsible financial or accounting officer of LifePoint to be the rate of interest implicit in such Capital Lease Obligation in accordance with GAAP. For purposes of making
the computation referred to above, interest on any Indebtedness under a revolving credit facility computed on a
pro forma
basis shall be computed based
upon the average daily balance of such Indebtedness during the applicable period. Interest on Indebtedness that may optionally be determined at an interest rate based upon a factor of a prime or
similar rate, a eurocurrency interbank offered rate, or other rate, shall be deemed to have been based upon the rate actually chosen, or, if none, then based upon such optional rate chosen as
LifePoint may designate.
For
purposes of this definition, whenever
pro forma
effect is to be given to an acquisition of assets, the amount of income or earnings
relating thereto and the amount of consolidated interest expense associated with any Indebtedness incurred in connection therewith, the
pro forma
calculations shall be
determined in good faith by a responsible financial or accounting officer of LifePoint. In addition, any such
pro forma
calculation may include
adjustments appropriate, in the reasonable determination of LifePoint as set forth in an officers' certificate, to reflect operating expense reductions reasonably expected to result from any
acquisition or merger.
"
GAAP
" means generally accepted accounting principles in the United States as in effect as of the Issue Date, including those set forth
in:
-
(1)
-
the
Financial Accounting Standards Board's FASB Accounting Standards Codification; and
-
(2)
-
the
rules and regulations of the SEC with respect to generally accepted accounting principles, including those governing the inclusion of financial statements in
periodic reports required to be filed pursuant to Section 13 of the Exchange Act, including opinions and pronouncements in staff accounting bulletins and similar written statements from the
accounting staff of the SEC.
"
Government Securities
" means securities that are:
-
(1)
-
direct
obligations of the United States of America for the timely payment of which its full faith and credit is pledged; or
-
(2)
-
obligations
of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is
unconditionally guaranteed as a full faith and credit obligation by the United States of America,
which,
in either case, are not callable or redeemable at the option of the issuers thereof, and shall also include a depository receipt issued by a bank (as defined in Section 3(a)(2) of the
Securities Act), as custodian with respect to any such Government Securities or a specific payment of principal of or interest on any such Government Securities held by such custodian for the account
of the holder of such depository receipt;
provided
that (except as required by law) such custodian is not authorized to make any deduction from the
amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Securities or the specific payment of principal of or interest on the
Government Securities evidenced by such depository receipt.
"
Guarantee
" means a guarantee other than by endorsement of negotiable instruments for collection in the ordinary course of business,
direct or indirect, in any manner including, without limitation, by way of a pledge of assets or through letters of credit or reimbursement agreements in respect thereof, of all or any part of any
Indebtedness.
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"
Guarantors
" means each of:
-
(1)
-
the
Wholly-Owned Subsidiaries that are Domestic Subsidiaries of LifePoint as of the Issue Date, other than Excluded Subsidiaries, and the Domestic Subsidiaries as of
the Issue Date which are non-Wholly-Owned Subsidiaries but which guarantee Indebtedness under the Credit Agreement, any other credit agreement, bank facility, term loan or any capital markets
securities of LifePoint or a Guarantor; and
-
(2)
-
any
other Subsidiary that executes a Subsidiary Guarantee in accordance with the provisions of the indenture, and their respective successors and assigns;
provided
that upon the release and discharge of any
Person from its Subsidiary Guarantee in accordance with the indenture, such Person shall cease to be
a Guarantor.
"
Hedging Obligations
" means, with respect to any specified Person, the obligations of such Person under:
-
(1)
-
interest
rate swap agreements, interest rate cap agreements and interest rate collar agreements; and
-
(2)
-
other
agreements or arrangements designed to protect such Person against fluctuations in interest rates or foreign exchange rates or commodity prices.
"
Hospital
" means a hospital, outpatient clinic, outpatient surgical center, long-term care facility, diagnostic facility, medical office
building or other facility or business that is used or useful in or related to the provision of healthcare services.
"
Indebtedness
" means, with respect to any specified Person, any indebtedness of such Person, whether or not contingent:
-
(1)
-
in
respect of borrowed money;
-
(2)
-
evidenced
by bonds, notes, debentures or similar instruments or letters of credit (or reimbursement agreements in respect thereof);
-
(3)
-
in
respect of banker's acceptances;
-
(4)
-
representing
Capital Lease Obligations of such Person and Attributable Debt in respect of Sale and Leaseback Transactions entered into by such Person;
-
(5)
-
representing
the balance deferred and unpaid of the purchase price of any property; or
-
(6)
-
representing
any Hedging Obligations,
if
and to the extent any of the preceding items (other than letters of credit and Hedging Obligations) would appear as a liability upon a balance sheet of the specified Person prepared in accordance
with GAAP. In addition, the term "Indebtedness" includes all Indebtedness of others secured by a Lien on any asset of the specified Person (whether or not such Indebtedness is assumed by the specified
Person) and, to the extent not otherwise included, the Guarantee by the specified Person of any indebtedness of any other Person, in each case limited to the maximum amount of liability of the
specified Person with respect to such Lien or Guarantee on the date in question. Notwithstanding anything in the foregoing to the contrary, Indebtedness shall not include trade payables or accrued
expenses for property or services incurred in the ordinary course of business, any liability for federal, state, local or other taxes, any settlements or judgments relating to governmental litigations
and/or investigations or contingent obligations incurred in the ordinary course of business. The amount of any Indebtedness issued with original issue discount will be the accreted value of such
Indebtedness.
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"
Insurance Subsidiary
" means a Subsidiary of LifePoint or any Restricted Subsidiary established for the purpose of
insuring the businesses or facilities owned or operated by LifePoint or any of its Subsidiaries or any joint venture to which they are party or any Person employed by or on the staff of any such
business or facility.
"
Investment Grade
" means (1) with respect to S&P, any of the rating categories from and including AAA to and including
BBB and (2) with respect to Moody's, any of the rating categories from and including Aaa to and including Baa3.
"
Investments
" means, with respect to any Person, all direct or indirect investments by such Person in other Persons (including Affiliates)
in the forms of loans (including Guarantees or other obligations), advances or capital contributions (excluding commission, travel and similar advances to directors, officers and employees made in the
ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities, together with all items that are or would be classified as
investments on a balance sheet prepared in accordance with GAAP. If LifePoint or any Restricted Subsidiary sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted
Subsidiary such that, after giving effect to any such sale or disposition, such Person is no
longer a Restricted Subsidiary, LifePoint will be deemed to have made an Investment on the date of any such sale or disposition equal to the fair market value of the Equity Interests of such
Restricted Subsidiary not sold or disposed of in an amount determined as provided in the covenant described above under the caption "
Certain
CovenantsRestricted Payments
";
provided
that LifePoint shall not have been deemed to have made an Investment
pursuant to the foregoing if LifePoint shall have previously or concurrently therewith been deemed to have made an Investment in connection with such Equity Interests. The acquisition by LifePoint or
any Restricted Subsidiary of a Person that holds an Investment in a third Person will be deemed to be an Investment by LifePoint or such Restricted Subsidiary in such third Person in an amount equal
to the fair market value of the Investment held by the acquired Person in such third Person in an amount determined as provided in the covenant described above under the caption
"
Certain CovenantsRestricted Payments
";
provided
LifePoint or such Restricted
Subsidiary shall not have been deemed to have made an Investment pursuant to the foregoing if LifePoint or any Restricted Subsidiary shall have previously or concurrently therewith been deemed to have
made an Investment in connection with such acquisition. "Investments" shall exclude extensions of trade credit.
"
Issue Date
" means May 26, 2016, the issuance date of the outstanding notes.
"
Lien
" means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, any lease in the nature thereof, any option
or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction.
"
Limited Originator Recourse
" means a reimbursement obligation of LifePoint in connection with a drawing on a letter of credit, revolving
loan commitment, cash collateral account or other such credit enhancement issued to support Indebtedness of a Securitization Subsidiary that LifePoint's board of directors (or a duly authorized
committee thereof) determines is necessary to effectuate a Qualified Securitization Transaction;
provided
that the available amount of any such form of
credit enhancement at any time shall not exceed 10% of the principal amount of such Indebtedness at such time; and
provided
,
further
, that such
reimbursement obligation is permitted to be incurred by LifePoint pursuant to the covenant described above under the caption
"
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
."
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"
Net Income
" means, with respect to any specified Person, the net income (loss) of such Person, determined in accordance with GAAP and
before any reduction in respect of preferred stock dividends, excluding, however:
-
(1)
-
any
gain or loss, together with any related provision for taxes on such gain or loss, realized in connection with: (a) any Asset Sale (without regard to the
dollar limitation in the definition thereof); (b) the disposition of any securities by such Person or any of its Restricted Subsidiaries or the extinguishment of any Indebtedness of such Person
or any of its Restricted Subsidiaries; or (c) any acquisition, recapitalization or Permitted Investment of such Person or any of its Restricted Subsidiaries;
-
(2)
-
any
extraordinary, unusual or non-recurring gain, charge, expense or loss (together with any related provision for taxes on such extraordinary, unusual or
non-recurring gain, charge, expense or loss), including, without limitation, (a) restructuring charges, reserves or other related expenses, (b) fees, expenses or charges relating to
facility shutdowns and discontinued operations, (c) acquisition integration costs, (d) severance or other employee termination or relocation costs, expenses or charges,
(e) non-cash compensation charges recorded from grants of stock options, restricted stock, stock appreciation rights and other equity equivalents to officers, directors and employees and
(f) litigation and investigation settlement costs and related expenses; and
-
(3)
-
the
net income (or loss) from disposed or discontinued operations for the four fiscal quarters preceding the date of determining Net Income.
"
Net Proceeds
" means the aggregate cash proceeds and Cash Equivalents received by LifePoint or its Restricted Subsidiaries in respect of
any Asset Sale (including, without limitation, any cash received upon the sale or other disposition of any non-cash consideration received in any Asset Sale), net of the direct costs relating to such
Asset Sale, including, without limitation, legal, accounting and investment banking fees, sales commissions, any relocation expenses incurred as a result of the Asset Sale, any taxes paid or payable
as a result of the Asset Sale, in each case, after taking into account any available tax credits or deductions and any tax sharing arrangements, amounts required to be applied to the repayment of
Indebtedness, all distributions and other payments required to be made to non-majority interest holders in subsidiaries or joint ventures as a result of such Asset Sale and appropriate amounts to be
provided by LifePoint or any Restricted Subsidiary, as the case may be, as a reserve required in accordance with GAAP against any liabilities associated with such Asset Sale and retained by LifePoint
or any Restricted Subsidiary, as the case may be, after such Asset Sale, including, without limitation, pension and other post-employment benefit liabilities, liabilities related to environmental
matters and liabilities under any indemnification obligations associated with such Asset Sale.
"
New Markets Tax Credit program
" means the New Markets Tax Credit program authorized under the Community Renewal and Tax Relief Act of
2000, and jointly administered by the Community Development Financial Institutions Fund and the Internal Revenue Service or any successor or substantially similar Federal tax program having
substantially similar structures and financial effect.
"
NMTC Special Purpose Entity
" means a special purpose or similar entity, or any subsidiary thereof, formed for purposes of participating
in the New Markets Tax Credit program.
"
Obligations
" means any principal, interest, penalties, fees, indemnifications, reimbursements, damages and other liabilities payable
under the documentation governing any Indebtedness.
"
Permitted Business
" means the business or businesses conducted by LifePoint and its Restricted Subsidiaries, or any of them, as of the
Issue Date and any business ancillary or complementary thereto.
"
Permitted Debt
" has the meaning set forth in the covenant described above under the caption "
Certain
CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
."
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"
Permitted Investments
" means:
-
(1)
-
any
Investment in LifePoint or in a Restricted Subsidiary;
-
(2)
-
any
Investment in Cash Equivalents;
-
(3)
-
any
Investment by LifePoint or any Restricted Subsidiary in a Person, if as a result of such Investment:
-
(a)
-
such
Person becomes a Restricted Subsidiary; or
-
(b)
-
such
Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, LifePoint or a
Restricted Subsidiary;
-
(4)
-
any
Investment made as a result of the receipt of non-cash consideration from an Asset Sale (including any Asset Swap) that was made pursuant to and in compliance
with the covenant described above under the caption "
Repurchase at the Option of HoldersAsset Sales
" or any disposition of
assets not constituting an Asset Sale;
-
(5)
-
any
Investment received to the extent the consideration therefor was the issuance of Equity Interests (other than Disqualified Stock) of LifePoint;
-
(6)
-
Hedging
Obligations;
-
(7)
-
intercompany
Indebtedness to the extent permitted under the covenant described above under the caption the "
Certain
CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
";
-
(8)
-
Investments
in prepaid expenses, negotiable instruments held for collection and lease, utility and workers' compensation, performance and other similar deposits made
in the ordinary course of business and Investments to secure participation in government reimbursement programs;
-
(9)
-
loans
and advances to officers, directors and employees made in the ordinary course of business;
-
(10)
-
Investments
represented by accounts and notes receivable created or acquired in the ordinary course of business;
-
(11)
-
Investments
existing on the Issue Date and any renewal or replacement thereof on terms and conditions not materially less favorable than that being renewed or
replaced;
-
(12)
-
Investments
by any qualified or nonqualified benefit plan established by LifePoint or its Restricted Subsidiaries made in accordance with the terms of such plan, or
any Investments made by LifePoint or any Restricted Subsidiary in connection with the funding thereof;
-
(13)
-
Investments
received in settlement of debts or judgments owed to LifePoint or any Restricted Subsidiary, including, without limitation, as a result of foreclosure,
perfection or enforcement of any Lien or indebtedness or in connection with any bankruptcy, liquidation, receivership or insolvency proceeding;
-
(14)
-
Investments
in any Subsidiary that constitutes a special purpose entity formed for the primary purpose of issuing trust preferred or similar securities in a
transaction permitted by the covenant described above under the caption "
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred
Stock
" covenant;
-
(15)
-
Investments
deemed to have been made as a result of the acquisition of a Person permitted under clause (3) of this definition;
provided
that such Investments are not acquired in contemplation of the
acquisition;
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-
(16)
-
Investments
by LifePoint or a Restricted Subsidiary in a Securitization Subsidiary in connection with a Qualified Securitization Transaction, which investment
consists of a retained interest in transferred Receivables and Related Assets;
-
(17)
-
Investments
made within 90 days after the date of the commitment to make the Investment, that when such commitment was made would have complied with the
terms of the indenture;
-
(18)
-
Guarantees
issued in accordance with the covenant described above under the caption "
Certain CovenantsIncurrence
of Indebtedness and Issuance of Preferred Stock
" and performance guarantees;
-
(19)
-
payroll,
travel and similar advances to cover matters that are expected at the time of such advances ultimately to be treated as expenses for accounting purposes
and that are made in the ordinary course of business;
-
(20)
-
Investments
in a Permitted Joint Venture, together with all other Investments made by LifePoint or any Restricted Subsidiary pursuant to this clause (20) in
an aggregate amount at the time of such Investment not to exceed the greater of $75 million and 1.5% of Total Assets in the aggregate outstanding at any one time;
-
(21)
-
Investments
in any Insurance Subsidiary in an amount which does not at the time made exceed 125% of the minimum amount of capital required under the laws of the
jurisdiction in which the Insurance Subsidiary is formed (other than any excess capital that would result in any unfavorable tax or reimbursement impact if distributed), in any self-insurance trust in
an amount not to exceed 125% of the aggregate amount of the risk retained by the Insurance Subsidiary, LifePoint or any of its Subsidiaries on an annual basis and any Investment by such Insurance
Subsidiary or self-insurance trust which is a legal investment for an insurance company under the laws of the jurisdiction in which the Insurance Subsidiary is formed or for a self-insurance trust
under the applicable laws;
-
(22)
-
Investments
consisting of Physician Support Obligations made by LifePoint or any Restricted Subsidiary;
-
(23)
-
Investments
consisting of loans made to a NMTC Special Purpose Entity in connection with the New Markets Tax Credit program, the funds from which are then borrowed
by a Restricted Subsidiary; and
-
(24)
-
other
Investments in any Person having an aggregate fair market value (measured on the date each such Investment was made and without giving effect to subsequent
changes in value), when taken together with all other outstanding Investments made pursuant to this clause (24), not to exceed the greater of $300 million and 6.0% of Total Assets in the
aggregate at any one time outstanding.
"
Permitted Joint Venture
" means, with respect to any Person, (1) any corporation, association, or other business entity (other than
a partnership) of which 50% or less of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers
or trustees thereof is at the time of determination owned or controlled, directly or indirectly, by such Person or one or more of the Restricted Subsidiaries of that Person or a combination thereof
and (2) any partnership, joint venture, limited liability company or similar entity of which 50% or less of the capital accounts, distribution rights, total equity and voting interests or
general or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Restricted Subsidiaries of that Person or a
combination thereof whether in the form of membership, general, special or limited partnership interests or otherwise.
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"
Permitted Liens
" means:
-
(1)
-
Liens
in favor of LifePoint or its Restricted Subsidiaries;
-
(2)
-
Liens
on property of a Person existing at the time such Person is merged with or into or consolidated with LifePoint or any Restricted Subsidiary;
provided
that such Liens were in existence prior to the
contemplation of such merger or consolidation and do not extend to any assets other than those
of the Person merged into or consolidated with LifePoint or the Restricted Subsidiary;
-
(3)
-
Liens
on property existing at the time of acquisition of the property by LifePoint or any Restricted Subsidiary;
provided
that such Liens were in existence prior to the contemplation of such acquisition;
-
(4)
-
Liens
to secure Indebtedness (including, without limitation, Capital Lease Obligations) permitted by clause (4) of the second paragraph of the covenant
described above under the caption "
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
" covering only
the assets acquired with such Indebtedness;
-
(5)
-
Liens
existing on the Issue Date;
-
(6)
-
Liens
for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings
promptly instituted and diligently concluded,
provided
that any reserve or other appropriate provision as is required in conformity with GAAP has been
made therefor;
-
(7)
-
Liens
securing any Hedging Obligations of LifePoint or any Restricted Subsidiary;
-
(8)
-
Liens
securing any Indebtedness otherwise permitted to be incurred under the indenture, the proceeds of which are used to refinance Indebtedness of LifePoint or any
Restricted Subsidiary;
provided
that such Liens extend to or cover only the assets secured by the Indebtedness being refinanced;
-
(9)
-
Liens
on property of a Person existing at the time such Person becomes a Restricted Subsidiary;
provided
that such
Liens were not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary;
-
(10)
-
statutory
Liens and other Liens imposed by law incurred in the ordinary course of business for sums not yet delinquent or being contested in good faith, if
LifePoint or any applicable Restricted Subsidiaries shall have made any reserves or other appropriate provision required by GAAP;
-
(11)
-
Liens
incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social
security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, performance, return-of-money bonds, participation in government
reimbursement programs and other similar obligations;
-
(12)
-
judgment
Liens not giving rise to an Event of Default, so long as any appropriate legal proceedings which may have been duly initiated for the review of such
judgment shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired;
-
(13)
-
easements,
rights-of-way, zoning restrictions and other similar charges or encumbrances in respect of real property not interfering in any material respect with the
conduct of the business of LifePoint or any of its Restricted Subsidiaries;
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-
(14)
-
any
interest or title of a lessor in assets or property subject to Capital Lease Obligations or an operating lease of LifePoint or any Restricted Subsidiary;
-
(15)
-
Liens
incurred in connection with a financing involving the sale or other disposition of accounts receivable and related assets (including, without limitation, in
connection with a securitization or similar financing);
-
(16)
-
leases
or subleases granted to others not interfering with the ordinary conduct of the business of LifePoint or any of the Restricted Subsidiaries;
-
(17)
-
bankers'
liens with respect to the right of set-off arising in the ordinary course of business against amounts maintained in bank accounts or certificates of
deposit in the name of LifePoint or any Restricted Subsidiary;
-
(18)
-
the
interest of any issuer of a letter of credit in any cash or Cash Equivalents deposited with or for the benefit of such issuer as collateral for such letter of
credit;
provided
that the Indebtedness so collateralized is permitted to be incurred by the terms of the indenture;
-
(19)
-
any
Lien consisting of a right of first refusal or option to purchase an ownership interest in any Restricted Subsidiary or to purchase assets of LifePoint or any
Restricted Subsidiary, which right of first refusal or option is entered into in the ordinary course of business or is otherwise permitted under the indenture;
-
(20)
-
any
Lien granted to the trustee pursuant to the terms of the indenture and any substantially equivalent Lien granted to the respective trustees under the indentures
for other debt securities of LifePoint;
-
(21)
-
statutory,
contractual or common law Liens of landlords and mortgagees of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen,
repairmen or workmen in the ordinary course of business;
-
(22)
-
licenses
and sublicenses of intellectual property granted to third parties in the ordinary course of business;
-
(23)
-
Liens
upon specific items of inventory or other goods and proceeds of any Person securing such Person's Obligations in respect of bankers' acceptances issued or
created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
-
(24)
-
Liens
securing Indebtedness of any Restricted Subsidiary (other than a Guarantor) that was permitted by the terms of this indenture to be incurred, and related
Obligations, which Liens encumber only assets of such Restricted Subsidiary;
-
(25)
-
Liens
securing Indebtedness incurred pursuant to clause (1) or (22) of the second paragraph of the covenant described above under the caption
"
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
";
-
(26)
-
Liens
securing any Indebtedness incurred pursuant to the first paragraph of the covenant described above under the caption
"
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
" so long as, after giving effect to such
incurrence, the Consolidated Secured Debt Ratio shall be equal to or less than 3.5 to 1 as of the date on which such Lien is incurred;
-
(27)
-
Liens
with respect to obligations that do not at any one time outstanding exceed the greater of $300 million and 6.0% of Total Assets; and
-
(28)
-
Liens
on assets transferred to a Securitization Subsidiary or on assets of a Securitization Subsidiary, in either case, incurred in connection with a Qualified
Securitization Transaction.
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"
Permitted Refinancing Indebtedness
" means any Indebtedness of LifePoint or any Restricted Subsidiary issued in exchange for, or the net
proceeds of which are used to extend, refinance, renew, replace, defease or refund other Indebtedness of LifePoint or any of its Restricted Subsidiaries (other than intercompany Indebtedness);
provided
that:
-
(1)
-
the
principal amount of such Permitted Refinancing Indebtedness does not exceed the principal amount of the Indebtedness extended, refinanced, renewed, replaced,
defeased or refunded (plus all accrued interest on the Indebtedness and the amount of all fees, expenses and premiums incurred in connection therewith);
-
(2)
-
such
Permitted Refinancing Indebtedness has a final maturity date not earlier than the final maturity date of, and has a Weighted Average Life to Maturity equal to
or greater than, the Weighted Average Life to Maturity of, the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded;
-
(3)
-
if
the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded is subordinated in right of payment to the notes, such Permitted Refinancing
Indebtedness is subordinated in right of payment to the notes on terms not materially less favorable to the Holders of notes as those contained in the documentation governing the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; and
-
(4)
-
if
the Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded was incurred by LifePoint or a Guarantor, the obligor on the Permitted
Refinancing Indebtedness may not be a Restricted Subsidiary that is not a Guarantor.
"
Person
" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated
organization, limited liability company or government or other entity.
"
Physician Support Obligation
" means:
-
(1)
-
a
loan to or on behalf of, or a Guarantee of Indebtedness of or income of, (x) a physician or healthcare professional providing service to patients in the
service area of a Hospital operated by LifePoint or any of its Restricted Subsidiaries or (y) any independent practice association or other entity that is majority owned by any Person or group
of Persons described in clause (x), in either case made or given by LifePoint or any Restricted Subsidiary of LifePoint:
-
(a)
-
in
the ordinary course of its business; and
-
(b)
-
pursuant
to a written agreement having a period not to exceed five years; or
-
(2)
-
Guarantees
by LifePoint or any Restricted Subsidiary of leases and loans to acquire property (real or personal) for or on behalf of a physician, healthcare
professional or any independent practice association or other entity that is majority owned by any Person or group of Persons described in clause (x) above providing service to patients in the
service area of a Hospital operated by LifePoint or any of its Restricted Subsidiaries.
"
Principal Property
" means each Hospital (excluding personal property, office fixtures and equipment (including data processing equipment,
vehicles and equipment used on, or useful with, vehicles)) owned solely by LifePoint and/or one or more of its Subsidiaries and located in the United States of America unless the Board of Directors of
LifePoint determines that any such hospital is not material to LifePoint and its Subsidiaries taken as a whole.
"
Qualified Securitization Transaction
" means any transaction or series of transactions that may be entered into by LifePoint or any
Restricted Subsidiary pursuant to which (a) LifePoint or any Restricted Subsidiary may sell, convey or otherwise transfer to a Securitization Subsidiary its interests in Receivables and Related
Assets and (b) such Securitization Subsidiary transfers to any other person, or
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grants
a security interest in, such Receivables and Related Assets, pursuant to a transaction which is customarily used to achieve a transfer of financial assets under GAAP.
"
Receivables and Related Assets
" means any account receivable (whether now existing or arising thereafter) of LifePoint or any Restricted
Subsidiary, and any assets related thereto including all collateral securing such accounts receivable, all contracts and contract rights and all Guarantees or other obligations in respect of such
accounts receivable, proceeds of such accounts receivable and other assets which are customarily transferred or in respect of which security interest are customarily granted in connection with asset
securitization transaction involving accounts receivable.
"
Registration Rights Agreement
" means the Registration Rights Agreement, dated May 26, 2016, among LifePoint, the Guarantors
identified therein and Goldman, Sachs & Co., as representative of the several initial purchasers.
"
Replacement Assets
" mean properties or assets substantially similar to the assets disposed of in a particular Asset Sale and acquired to
replace the properties or assets that were the subject of such Asset Sale or that are otherwise useful in a Permitted Business.
"
Restricted Investment
" means an Investment other than a Permitted Investment.
"
Restricted Subsidiary
" means any direct or indirect Subsidiary of LifePoint other than an Unrestricted Subsidiary.
"
Sale and Leaseback Transaction
" means, with respect to any Person, an arrangement whereby such Person enters into a lease of property
previously transferred by such Person to the lessor in contemplation of such leasing.
"
Securitization Subsidiary
" means a Subsidiary of LifePoint:
-
(1)
-
that
is designated a "
Securitization Subsidiary
" by the board of directors of LifePoint (or a duly authorized
committee thereof);
-
(2)
-
that
does not engage in any activities other than Qualified Securitization Transactions and any activity necessary or incidental thereto;
-
(3)
-
no
portion of the Indebtedness or any other obligation, contingent or otherwise, of which
-
(A)
-
is
Guaranteed by LifePoint or any Restricted Subsidiary in any way other than pursuant to Standard Securitization Undertakings or Limited Originator Recourse,
-
(B)
-
is
recourse to or obligates LifePoint or any other Restricted Subsidiary in any way other than pursuant to Standard Securitization Undertakings or Limited Originator
Recourse, or
-
(C)
-
subjects
any property or asset of LifePoint or any other Restricted Subsidiary, directly or indirectly, contingently or otherwise, to the satisfaction thereof other
than pursuant to Standard Securitization Undertakings or Limited Originator Recourse; and
-
(4)
-
with
respect to which neither LifePoint nor any other Restricted Subsidiary has any obligation to maintain or preserve its financial condition or cause it to achieve
certain levels of operating results.
Any
designation of a Subsidiary as a Securitization Subsidiary shall be evidenced to the trustee by filing with the trustee a certified copy of the resolution of the board of directors
of LifePoint giving effect to the designation and an officers' certificate certifying that the designation complied with the preceding conditions.
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"
Significant Subsidiary
" means any Restricted Subsidiary that would be a "significant subsidiary" as defined in Article 1,
Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such Regulation is in effect on the date hereof.
"
Standard Securitization Undertakings
" means representations, warranties, covenants and indemnities entered into by LifePoint or any
Restricted Subsidiary that are reasonably customary in accounts receivable securitization transactions, as the case may be.
"
Stated Maturity
" means, with respect to any installment of interest or principal on any series of Indebtedness, the date on which the
payment of interest or principal was scheduled to be paid in the original documentation governing such Indebtedness, and will not include any contingent obligations to repay, redeem or repurchase any
such interest or principal prior to the date originally scheduled for the payment thereof.
"
Subordinated Indebtedness
" means any Indebtedness of LifePoint or any Guarantor which is subordinated in right of payment to the notes or
any Subsidiary Guarantee, as applicable, pursuant to a written agreement to that effect.
"
Subsidiary
" means, with respect to any specified Person, (a) any corporation more than 50% of the outstanding securities having
ordinary voting power of which shall at the time be owned or controlled, directly or indirectly, by such Person or by one or more of its Restricted Subsidiaries or by such Person and one or more of
its Restricted Subsidiaries, or (b) any partnership, limited liability company, association, joint venture or similar business organization more than 50% of the ownership interests having
ordinary voting power of which shall at the time be so owned or controlled.
"
Subsidiary Guarantee
" means a guarantee of notes pursuant to the indenture.
"
Total Assets
" means, as of any date of determination, the total assets of LifePoint and its Restricted Subsidiaries as shown on the
balance sheet for the most recently completed quarter for which internal financial statements are available determined in accordance with GAAP.
"
Treasury Rate
" means, as of the date the redemption notice is given to holders of the notes, the yield to maturity as of such date (as
compiled by and published in the most recent Federal Reserve Statistical Release H. 15(519), which has become publicly available at least two business days prior to the date of the redemption notice
for which such computation is being made (or if such Statistical Release is no longer published, as reported in any publicly available source of similar market data)), of United States Treasury
securities with a constant maturity most nearly equal to the period from the relevant redemption date to May 1, 2019;
provided
that, if such
period is not equal to the constant maturity of the United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated
to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury securities for which such yields are given;
provided
,
further
, that if such period is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant
maturity of one year shall be used.
"
Unrestricted Subsidiary
" means any Subsidiary of LifePoint that is designated by the Board of Directors of LifePoint as an Unrestricted
Subsidiary pursuant to a Board Resolution, but only to the extent that such Subsidiary:
-
(1)
-
has
no Indebtedness other than Indebtedness that is without recourse to LifePoint or its Restricted Subsidiaries;
-
(2)
-
is
not party to any agreement, contract, arrangement or understanding with LifePoint or any Restricted Subsidiary unless the terms of any such agreement, contract,
arrangement or understanding are not materially less favorable to LifePoint or such Restricted Subsidiary than those that might be obtained at the time from Persons who are not Affiliates of
LifePoint;
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-
(3)
-
is
a Person with respect to which neither LifePoint nor any of its Restricted Subsidiaries has any (a) continuing direct or indirect obligation to subscribe
for additional Equity Interests or (b) direct or indirect obligation to maintain or preserve such Person's financial condition or to cause such Person to achieve any specified levels of
operating results; and
-
(4)
-
has
not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of LifePoint or any of its Restricted Subsidiaries.
In
addition, any Subsidiary that constitutes a special purpose entity formed for the primary purpose of financing receivables or for the primary purpose of issuing trust preferred or
similar securities in connection with a transaction permitted by the covenant described above under the caption "
Certain CovenantsIncurrence of
Indebtedness and Issuance of Preferred Stock
" shall be, and any Insurance Subsidiary may be, an Unrestricted Subsidiary.
Any
designation of a Subsidiary of LifePoint as an Unrestricted Subsidiary after the Issue Date will be evidenced to the trustee by filing with the trustee a certified copy of the
resolution of the Board of Directors of LifePoint giving effect to such designation and an officers' certificate certifying that such designation complied with the preceding conditions and was
permitted by the covenant described above under the caption "
Certain CovenantsRestricted Payments
." If, at any time, any
Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of the indenture and any
Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of LifePoint as of such date and, if such Indebtedness is not permitted to be incurred as of such date under
the covenant described above under the caption "
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
,"
LifePoint will be in default of such covenant. The Board of Directors of LifePoint may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary;
provided
that such designation
will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of any outstanding Indebtedness of such
Unrestricted Subsidiary and such designation will only be permitted if (1) such Indebtedness is permitted under the covenant described above under the caption
"
Certain CovenantsIncurrence of Indebtedness and Issuance of Preferred Stock
," calculated on a
pro
forma
basis as if such designation had occurred at the beginning of the four quarter reference period; and (2) no Default or Event of Default would be in existence
following such designation.
"
Voting Stock
" of any Person as of any date means the Capital Stock of such Person that is at the time entitled to vote in the election of
the Board of Directors of such Person.
"
Weighted Average Life to Maturity
" means, when applied to any Indebtedness at any date, the number of years obtained by
dividing:
-
(1)
-
the
sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect of the Indebtedness, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the
making of such payment; by
-
(2)
-
the
then outstanding principal amount of such Indebtedness.
"
Wholly-Owned Subsidiary
" of any Person means a Subsidiary of such Person, 100% of the outstanding Equity Interests of which (other than
directors' qualifying shares) shall at the time be owned by such Person or by one or more Wholly-Owned Subsidiaries of such Person.
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BOOK-ENTRY SETTLEMENT AND CLEARANCE
The Global Notes
The outstanding notes were initially issued in the form of several registered notes in global form, without interest coupons, as
follows:
-
-
notes sold to qualified institutional buyers under Rule 144A were represented by the Rule 144A global note; and
-
-
notes sold in offshore transactions to non-U.S. persons in reliance on Regulation S were represented by the Regulation S global
note.
Upon
issuance, each of the outstanding notes were, and each of the exchange notes will be, deposited with the Trustee as custodian for The Depository Trust Company ("DTC") and registered
in the name of Cede & Co., as nominee of DTC.
Ownership of beneficial interests in each note was, and will be, limited to persons who have accounts with DTC ("DTC participants") or persons who hold interests
through DTC participants. We expect that under procedures established by DTC:
-
-
upon deposit of each global note with DTC's custodian, DTC will credit portions of the principal amount of the global note to the accounts of
the DTC participants; and
-
-
ownership of beneficial interests in each global note will be shown on, and transfer of ownership of those interests will be effected only
through, records maintained by DTC (with respect to interests of DTC participants) and the records of DTC participants (with respect to other owners of beneficial interests in the global note).
Beneficial
interests in the global notes may not be exchanged for notes in physical, certificated form except in the limited circumstances described below.
Exchanges Among the Global Notes
After consummation of the exchange offer, beneficial interests in one outstanding note may generally be exchanged for interests in another
outstanding note and beneficial interest in one exchange note may generally be exchanged for interest in another exchange note. Depending on which global note the transfer is being made, the Trustee
may require the seller to provide certain written certifications in the form provided in the indenture.
A
beneficial interest in a global note that is transferred to a person who takes delivery through another global note will, upon transfer, become subject to any transfer restrictions and
other procedures applicable to beneficial interests in the other global note.
Book-Entry Procedures for the Global Notes
All interests in the global notes will be subject to the operations and procedures of DTC. We provide the following summaries of those
operations and procedures solely for the convenience of investors. The operations and procedures of DTC are controlled by DTC and may be changed at any time. Neither we, the Trustee nor the initial
purchasers are responsible for those operations or procedures.
DTC
has advised us that it is:
-
-
a limited purpose trust company organized under the laws of the State of New York;
-
-
a "banking organization" within the meaning of the New York State Banking Law;
-
-
a member of the Federal Reserve System;
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-
-
a "clearing corporation" within the meaning of the Uniform Commercial Code; and
-
-
a "clearing agency" registered under Section 17A of the Securities Exchange Act of 1934.
DTC
was created to hold securities for its participants and to facilitate the clearance and settlement of securities transactions between its participants through electronic book-entry
changes to the accounts of its participants. DTC's participants include securities brokers and dealers, including the initial purchasers, banks and trust companies, clearing corporations and other
organizations. Indirect access to DTC's system is also available to others such as banks, brokers, dealers and trust companies; these indirect participants clear through or maintain a custodial
relationship with a DTC participant, either directly or indirectly. Investors who are not DTC participants may beneficially own securities held by or on behalf of DTC only through DTC participants or
indirect participants in DTC.
So
long as DTC's nominee is the registered owner of a global note, that nominee will be considered the sole owner or holder of the notes represented by that global note for all purposes
under the indenture. Except as provided below, owners of beneficial interests in a global note:
-
-
will not be entitled to have notes represented by the global note registered in their names;
-
-
will not receive or be entitled to receive physical, certificated notes; and
-
-
will not be considered the owners or holders of the notes under the indenture for any purpose, including with respect to the giving of any
direction, instruction or approval to the Trustee under the indenture.
As
a result, each investor who owns a beneficial interest in a global note must rely on the procedures of DTC to exercise any rights of a holder of notes under the indenture (and, if the
investor is not a participant or an indirect participant in DTC, on the procedures of the DTC participant through which the investor owns its interest).
Payments
of principal, premium (if any) and interest with respect to the notes represented by a global note will be made by the Trustee to DTC's nominee as the registered holder of the
global note. Neither we nor the Trustee will have any responsibility or liability for the payment of amounts to owners of beneficial interests in a global note, for any aspect of the records relating
to or payments made on account of those interests by DTC, or for maintaining, supervising or reviewing any records of DTC relating to those interests.
Payments
by participants and indirect participants in DTC to the owners of beneficial interests in a global note will be governed by standing instructions and customary industry practice
and will be the responsibility of those participants or indirect participants and DTC.
Transfers
between participants in DTC will be effected under DTC's procedures and will be settled in same-day funds. If the laws of a jurisdiction require that certain persons take
physical delivery of securities in definitive form, the ability to transfer beneficial interests in a global note to such persons may be limited. Because DTC can only act on behalf of participants,
who in turn act on behalf of indirect participants and certain banks, the ability of a person holding a beneficial interest in a global note to pledge its interest to a person or entity that does not
participate in the DTC system, or otherwise take actions in respect of its interest, may be affected by the lack of a physical security.
DTC
has agreed to the above procedures to facilitate transfers of interests in the global notes among participants in DTC. However, DTC is not obligated to perform these procedures and
may discontinue or change these procedures at any time. Neither we nor the Trustee will have any responsibility for the performance by DTC or its participants or indirect participants of their
obligations under the rules and procedures governing its operations.
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Certificated Notes
Notes in physical, certificated form will be issued and delivered to each person that DTC identifies as a beneficial owner of the related notes
only if:
-
-
DTC notifies us at any time that it is unwilling or unable to continue as depositary for the global notes and a successor depositary is not
appointed within 90 days;
-
-
DTC ceases to be registered as a clearing agency under the Securities Exchange Act of 1934 and a successor depositary is not appointed within
90 days;
-
-
we, at our option, notify the Trustee that we elect to cause the issuance of certificated notes; or
-
-
certain other events provided in the indenture should occur.
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