Item 1.01. Entry into a Material Definitive Agreement.
On May 12, 2017, CHS/Community Health Systems, Inc. (the Issuer), a direct, wholly owned subsidiary of Community Health
Systems, Inc. (the Company), completed its previously announced tack-on public offering of $900,000,000 aggregate principal amount of its 6.250% Senior Secured Notes due 2023 at an issue price of 101.75% of their aggregate principal
amount, plus accrued interest from March 16, 2017 (the Additional Notes). The terms of the Additional Notes are governed by a base indenture, dated March 16, 2017, by and between the Issuer and Regions Bank, as trustee (the
Trustee) (the 2023 Base Indenture), as amended and supplemented by a first supplemental indenture, dated March 16, 2017, by and among the Issuer, the Company, the other guarantors party thereto, the Trustee and Credit
Suisse AG, as collateral agent (the First Supplemental Indenture) and a second supplemental indenture dated as of May 12, 2017, by and among the Issuer, the Company, the other guarantors party thereto, the Trustee and Credit Suisse
AG, as collateral agent (the Second Supplemental Indenture and, together with the 2023 Base Indenture and the First Supplemental Indenture, the Indenture).
The Additional Notes bear interest at a rate of 6.250% per year payable semi-annually in arrears on March 31 and September 30 of each year,
commencing on September 30, 2017.
The Issuer may redeem some or all of the Additional Notes at any time prior to March 31, 2020 at a price
equal to 100% of the principal amount of the Additional Notes redeemed plus accrued and unpaid interest, if any, plus a make-whole premium, as described in the Indenture. The Issuer may redeem some or all of the Additional Notes at any
time on or after March 31, 2020 at the redemption prices set forth in the Indenture, plus accrued and unpaid interest, if any. In addition, the Issuer may redeem up to 40% of the aggregate principal amount of the Additional Notes at any time
prior to March 31, 2020 using the net proceeds from certain equity offerings at the redemption price set forth in the Indenture, plus accrued and unpaid interest, if any.
If the Company or the Issuer experience a Change of Control (as defined in the Indenture), the Issuer is required to offer to repurchase the Additional Notes
at 101% of their principal amount plus accrued and unpaid interest, if any, to the date of purchase.
The Indenture provides for customary events of
default which include (subject in certain cases to customary grace and cure periods), among others, nonpayment of principal or interest, breach of other agreements in the Indenture, failure to pay certain other indebtedness, failure to pay certain
final judgments, failure of certain guarantees to be enforceable and certain events of bankruptcy or insolvency. The Indenture contains covenants that, among other things, limit the Companys ability and the ability of its restricted
subsidiaries to incur or guarantee additional indebtedness, pay dividends or make other restricted payments, make certain investments, create or incur certain liens, sell assets and subsidiary stock, impair a security interest, transfer all or
substantially all of the Companys assets or enter into merger or consolidation transactions and enter into transactions with affiliates.
The
Additional Notes are secured by a first-priority lien (subject to a shared lien of equal priority with certain other obligations, including obligations under our existing senior secured credit facilities (our Credit Facility), our 5.125%
Senior Secured Notes due 2021 (the 2021 Secured Notes) and, for so long as they remain outstanding, our 5.125% Senior Secured Notes due 2018 (the 2018 Secured Notes), and subject to other prior ranking liens permitted by the
Indenture) on substantially the same assets that secure the obligations under our Credit Facility, our 2021 Secured Notes and, for so long as they remain outstanding, the 2018 Secured Notes, subject to certain exceptions.
The foregoing summary and description of the Indenture and the Additional Notes does not purport to be complete and is subject to, and qualified in its
entirety by, the full text of the 2023 Base Indenture and the
First Supplemental Indenture, which were filed as Exhibits 4.1 and 4.2, respectively, to Companys Current Report on
Form 8-K
filed with the
Securities and Exchange Commission on March 16, 2017 and incorporated by reference herein, as well as the full text of the Second Supplemental Indenture, which is filed as Exhibit 4.3 hereto and incorporated by reference herein.
A copy of the press release announcing the completion of the Additional Notes offering is attached as Exhibit 99.1 to this Current Report on
Form 8-K.