(Mark One) | ||
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||
For the fiscal year ended December 31, | ||
OR | ||
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |
For the transition period fromto |
Delaware | 75-2497104 | |
(State or Other Jurisdiction of Incorporation or Organization) | (I.R.S. Employer Identification No.) | |
One Park Plaza Nashville, Tennessee | 37203 (Zip Code) | |
(Address of Principal Executive Offices) |
Large accelerated filer o | Accelerated filer o | Non-accelerated filer | Smaller reporting companyo |
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Item 1. | Business |
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• | maintain our dedication to the care and improvement of human life; | |
• | maintain our commitment to ethics and compliance; | |
• | leverage our leading local market positions; | |
• | expand our presence in key markets; | |
• | continue to leverage our scale; | |
• | continue to develop enduring physician relationships; and | |
• | become the health care employer of choice. |
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Year Ended December 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
Medicare | 26 | % | 27 | % | 28 | % | |||||||
Managed Medicare | 5 | (a | ) | (a | ) | ||||||||
Medicaid | 5 | 5 | 5 | ||||||||||
Managed Medicaid | 3 | 3 | 3 | ||||||||||
Managed care and other insurers(a) | 53 | 57 | 54 | ||||||||||
Uninsured(b) | 8 | 8 | 10 | ||||||||||
Total | 100 | % | 100 | % | 100 | % | |||||||
Year Ended December 31, | ||||||||||||
2007 | 2006 | 2005 | ||||||||||
Medicare | 24 | % | 26 | % | 27 | % | ||||||
Managed Medicare | 5 | 5 | (a | ) | ||||||||
Medicaid | 5 | 5 | 5 | |||||||||
Managed Medicaid | 3 | 3 | 3 | |||||||||
Managed care and other insurers(a) | 53 | 53 | 57 | |||||||||
Uninsured | 10 | 8 | 8 | |||||||||
Total | 100 | % | 100 | % | 100 | % | ||||||
(a) | Prior to 2006, managed Medicare revenues were classified as managed care. | |
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Psychiatric |
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Years Ended December 31, | ||||||||||||||||||||
2006 | 2005 | 2004 | 2003 | 2002 | ||||||||||||||||
Number of hospitals at end of period(a) | 166 | 175 | 182 | 184 | 173 | |||||||||||||||
Number of freestanding outpatient surgery centers at end of period(b) | 98 | 87 | 84 | 79 | 74 | |||||||||||||||
Number of licensed beds at end of period(c) | 39,354 | 41,265 | 41,852 | 42,108 | 39,932 | |||||||||||||||
Weighted average licensed beds(d) | 40,653 | 41,902 | 41,997 | 41,568 | 39,985 | |||||||||||||||
Admissions(e) | 1,610,100 | 1,647,800 | 1,659,200 | 1,635,200 | 1,582,800 | |||||||||||||||
Equivalent admissions(f) | 2,416,700 | 2,476,600 | 2,454,000 | 2,405,400 | 2,339,400 | |||||||||||||||
Average length of stay (days)(g) | 4.9 | 4.9 | 5.0 | 5.0 | 5.0 | |||||||||||||||
Average daily census(h) | 21,688 | 22,225 | 22,493 | 22,234 | 21,509 | |||||||||||||||
Occupancy rate(i) | 53 | % | 53 | % | 54 | % | 54 | % | 54 | % | ||||||||||
Emergency room visits(j) | 5,213,500 | 5,415,200 | 5,219,500 | 5,160,200 | 4,802,800 | |||||||||||||||
Outpatient surgeries(k) | 820,900 | 836,600 | 834,800 | 814,300 | 809,900 | |||||||||||||||
Inpatient surgeries(l) | 533,100 | 541,400 | 541,000 | 528,600 | 518,100 |
Years Ended December 31, | ||||||||||||||||||||
2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||
Number of hospitals at end of period (a) | 161 | 166 | 175 | 182 | 184 | |||||||||||||||
Number of freestanding outpatient surgery centers at end of period (b) | 99 | 98 | 87 | 84 | 79 | |||||||||||||||
Number of licensed beds at end of period (c) | 38,405 | 39,354 | 41,265 | 41,852 | 42,108 | |||||||||||||||
Weighted average licensed beds (d) | 39,065 | 40,653 | 41,902 | 41,997 | 41,568 | |||||||||||||||
Admissions (e) | 1,552,700 | 1,610,100 | 1,647,800 | 1,659,200 | 1,635,200 | |||||||||||||||
Equivalent admissions (f) | 2,352,400 | 2,416,700 | 2,476,600 | 2,454,000 | 2,405,400 | |||||||||||||||
Average length of stay (days) (g) | 4.9 | 4.9 | 4.9 | 5.0 | 5.0 | |||||||||||||||
Average daily census (h) | 21,049 | 21,688 | 22,225 | 22,493 | 22,234 | |||||||||||||||
Occupancy rate (i) | 54 | % | 53 | % | 53 | % | 54 | % | 54 | % | ||||||||||
Emergency room visits (j) | 5,116,100 | 5,213,500 | 5,415,200 | 5,219,500 | 5,160,200 | |||||||||||||||
Outpatient surgeries (k) | 804,900 | 820,900 | 836,600 | 834,800 | 814,300 | |||||||||||||||
Inpatient surgeries (l) | 516,500 | 533,100 | 541,400 | 541,000 | 528,600 |
(a) | Excludes eight facilities in 2007 and seven facilities in 2006, 2005, 2004 and 2003 | |
(b) | Excludes nine facilities in 2007 and 2006, seven facilities in 2005, eight facilities in 2004 and four facilities in 2003 that are not consolidated (accounted for using the equity method) for financial reporting purposes. | |
(c) | Licensed beds are those beds for which a facility has been granted approval to operate from the applicable state licensing agency. | |
(d) | Weighted average licensed beds represents the average number of licensed beds, weighted based on periods owned. | |
(e) | Represents the total number of patients admitted to our hospitals and is used by management and certain investors as a general measure of inpatient volume. |
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(f) | Equivalent admissions are used by management and certain investors as a general measure of combined inpatient and outpatient volume. Equivalent admissions are computed by multiplying admissions (inpatient volume) by the sum of gross inpatient revenue and gross outpatient revenue and then dividing the resulting amount by gross inpatient revenue. The equivalent admissions computation “equates” outpatient revenue to the volume measure (admissions) used to measure inpatient volume, resulting in a general measure of combined inpatient and outpatient volume. | |
(g) | Represents the average number of days admitted patients stay in our hospitals. | |
(h) | Represents the average number of patients in our hospital beds each day. | |
(i) | Represents the percentage of hospital licensed beds occupied by patients. Both average daily census and occupancy rate provide measures of the utilization of inpatient rooms. | |
(j) | Represents the number of patients treated in our emergency rooms. | |
(k) | Represents the number of surgeries performed on patients who were not admitted to our hospitals. Pain management and endoscopy procedures are not included in outpatient surgeries. | |
(l) | Represents the number of surgeries performed on patients who have been admitted to our hospitals. Pain management and endoscopy procedures are not included in inpatient surgeries. |
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Item 1A. | Risk Factors |
• | increasing our vulnerability to general economic and industry conditions; | |
• | requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities; | |
• | exposing us to the risk of increased interest rates as certain of our unhedged borrowings are at variable rates of interest; | |
• | limiting our ability to make strategic acquisitions or causing us to make nonstrategic divestitures; | |
• | limiting our ability to obtain additional financing for working capital, capital expenditures, product or service line development, debt service requirements, acquisitions and general corporate or other purposes; and | |
• | limiting our ability to adjust to changing market conditions and placing us at a competitive disadvantage compared to our competitors who are less highly leveraged. |
• | incur additional indebtedness or issue certain preferred shares; | |
• | pay dividends on, repurchase or make distributions in respect of our capital stock or make other restricted payments; | |
• | make certain investments; | |
• | sell or transfer assets; | |
• | create liens; |
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• | consolidate, merge, sell or otherwise dispose of all or substantially all of our assets; and | |
• | enter into certain transactions with our affiliates. |
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• | billing for services; | |
• | relationships with physicians and other referral sources; | |
• | adequacy of medical care; | |
• | quality of medical equipment and services; | |
• | qualifications of medical and support personnel; |
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• | confidentiality, maintenance and security issues associated with health-related information and medical records; | |
• | the screening, stabilization and transfer of individuals who have emergency medical conditions; | |
• | licensure and certification; | |
• | hospital rate or budget review; | |
• | operating policies and procedures; and | |
• | addition of facilities and services. |
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• | accounting and financial reporting; | |
• | billing and collecting accounts; | |
• | coding and compliance; | |
• | clinical systems; | |
• | medical records and document storage; | |
• | inventory management; and | |
• | negotiating, pricing and administering managed care contracts and supply contracts. |
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Item 1B. | Unresolved Staff Comments |
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Item 2. | Properties |
State | Hospitals | Beds | ||||||
Alaska | 1 | 250 | ||||||
California | 5 | 1,515 | ||||||
Colorado | 7 | 2,227 | ||||||
Florida | 37 | 9,427 | ||||||
Georgia | 13 | 2,234 | ||||||
Idaho | 2 | 481 | ||||||
Indiana | 1 | 278 | ||||||
Kansas | 4 | 1,286 | ||||||
Kentucky | 2 | 384 | ||||||
Louisiana | 10 | 1,602 | ||||||
Mississippi | 1 | 130 | ||||||
Missouri | 6 | 1,055 | ||||||
Nevada | 3 | 1,075 | ||||||
New Hampshire | 2 | 295 | ||||||
Oklahoma | 2 | 793 | ||||||
South Carolina | 3 | 740 | ||||||
Tennessee | 13 | 2,317 | ||||||
Texas | 35 | 10,054 | ||||||
Utah | 6 | 932 | ||||||
Virginia | 10 | 2,963 | ||||||
International | ||||||||
England | 6 | 704 | ||||||
169 | 40,742 | |||||||
Item 3. | Legal Proceedings |
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Item 4. | Submission of Matters to a Vote of Security Holders |
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Item 5. | Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities |
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Item 6. | Selected Financial Data |
2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||
Summary of Operations: | ||||||||||||||||||||
Revenues | $ | 26,858 | $ | 25,477 | $ | 24,455 | $ | 23,502 | $ | 21,808 | ||||||||||
Salaries and benefits | 10,714 | 10,409 | 9,928 | 9,419 | 8,682 | |||||||||||||||
Supplies | 4,395 | 4,322 | 4,126 | 3,901 | 3,522 | |||||||||||||||
Other operating expenses | 4,241 | 4,056 | 4,034 | 3,769 | 3,656 | |||||||||||||||
Provision for doubtful accounts | 3,130 | 2,660 | 2,358 | 2,669 | 2,207 | |||||||||||||||
Gains on investments | (8 | ) | (243 | ) | (53 | ) | (56 | ) | (1 | ) | ||||||||||
Equity in earnings of affiliates | (206 | ) | (197 | ) | (221 | ) | (194 | ) | (199 | ) | ||||||||||
Depreciation and amortization | 1,426 | 1,391 | 1,374 | 1,250 | 1,112 | |||||||||||||||
Interest expense | 2,215 | 955 | 655 | 563 | 491 | |||||||||||||||
Gains on sales of facilities | (471 | ) | (205 | ) | (78 | ) | — | (85 | ) | |||||||||||
Impairment of long-lived assets | 24 | 24 | — | 12 | 130 | |||||||||||||||
Transaction costs | — | 442 | — | — | — | |||||||||||||||
Government settlement and investigation related costs | — | — | — | — | (33 | ) | ||||||||||||||
25,460 | 23,614 | 22,123 | 21,333 | 19,482 | ||||||||||||||||
Income before minority interests and income taxes | 1,398 | 1,863 | 2,332 | 2,169 | 2,326 | |||||||||||||||
Minority interests in earnings of consolidated entities | 208 | 201 | 178 | 168 | 150 | |||||||||||||||
Income before income taxes | 1,190 | 1,662 | 2,154 | 2,001 | 2,176 | |||||||||||||||
Provision for income taxes | 316 | 626 | 730 | 755 | 844 | |||||||||||||||
Net income | $ | 874 | $ | 1,036 | $ | 1,424 | $ | 1,246 | $ | 1,332 | ||||||||||
Financial Position: | ||||||||||||||||||||
Assets | $ | 24,025 | $ | 23,675 | $ | 22,225 | $ | 21,840 | $ | 21,400 | ||||||||||
Working capital | 2,356 | 2,502 | 1,320 | 1,509 | 1,654 | |||||||||||||||
Long-term debt, including amounts due within one year | 27,308 | 28,408 | 10,475 | 10,530 | 8,707 | |||||||||||||||
Minority interests in equity of consolidated entities | 938 | 907 | 828 | 809 | 680 | |||||||||||||||
Equity securities with contingent redemption rights | 164 | 125 | — | — | — | |||||||||||||||
Stockholders’ (deficit) equity | (10,538 | ) | (11,374 | ) | 4,863 | 4,407 | 6,209 | |||||||||||||
Cash Flow Data: | ||||||||||||||||||||
Cash provided by operating activities | $ | 1,396 | $ | 1,845 | $ | 2,971 | $ | 2,954 | $ | 2,292 | ||||||||||
Cash used in investing activities | (479 | ) | (1,307 | ) | (1,681 | ) | (1,688 | ) | (2,862 | ) | ||||||||||
Cash (used in) provided by financing activities | (1,158 | ) | (240 | ) | (1,212 | ) | (1,347 | ) | 650 |
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2007 | 2006 | 2005 | 2004 | 2003 | ||||||||||||||||
Operating Data: | ||||||||||||||||||||
Number of hospitals at end of period(a) | 161 | 166 | 175 | 182 | 184 | |||||||||||||||
Number of freestanding outpatient surgical centers at end of period(b) | 99 | 98 | 87 | 84 | 79 | |||||||||||||||
Number of licensed beds at end of period(c) | 38,405 | 39,354 | 41,265 | 41,852 | 42,108 | |||||||||||||||
Weighted average licensed beds(d) | 39,065 | 40,653 | 41,902 | 41,997 | 41,568 | |||||||||||||||
Admissions(e) | 1,552,700 | 1,610,100 | 1,647,800 | 1,659,200 | 1,635,200 | |||||||||||||||
Equivalent admissions(f) | 2,352,400 | 2,416,700 | 2,476,600 | 2,454,000 | 2,405,400 | |||||||||||||||
Average length of stay (days)(g) | 4.9 | 4.9 | 4.9 | 5.0 | 5.0 | |||||||||||||||
Average daily census(h) | 21,049 | 21,688 | 22,225 | 22,493 | 22,234 | |||||||||||||||
Occupancy(i) | 54 | % | 53 | % | 53 | % | 54 | % | 54 | % | ||||||||||
Emergency room visits(j) | 5,116,100 | 5,213,500 | 5,415,200 | 5,219,500 | 5,160,200 | |||||||||||||||
Outpatient surgeries(k) | 804,900 | 820,900 | 836,600 | 834,800 | 814,300 | |||||||||||||||
Inpatient surgeries(l) | 516,500 | 533,100 | 541,400 | 541,000 | 528,600 | |||||||||||||||
Days revenues in accounts receivable(m) | 53 | 53 | 50 | 48 | 52 | |||||||||||||||
Gross patient revenues(n) | $ | 92,429 | $ | 84,913 | $ | 78,662 | $ | 71,279 | $ | 62,626 | ||||||||||
Outpatient revenues as a % of patient revenues(o) | 37 | % | 36 | % | 36 | % | 37 | % | 37 | % |
(a) | Excludes eight facilities in 2007 and seven facilities in 2006, 2005, 2004, and 2003 that are not consolidated (accounted for using the equity method) for financial reporting purposes. | |
(b) | Excludes nine facilities in 2007 and 2006, seven facilities in 2005, eight facilities in 2004 and four facilities in 2003 that are not consolidated (accounted for using the equity method) for financial reporting purposes. | |
(c) | Licensed beds are those beds for which a facility has been granted approval to operate from the applicable state licensing agency. | |
(d) | Weighted average licensed beds represents the average number of licensed beds, weighted based on periods owned. | |
(e) | Represents the total number of patients admitted to our hospitals and is used by management and certain investors as a general measure of inpatient volume. | |
(f) | Equivalent admissions are used by management and certain investors as a general measure of combined inpatient and outpatient volume. Equivalent admissions are computed by multiplying admissions (inpatient volume) by the sum of gross inpatient revenue and gross outpatient revenue and then dividing the resulting amount by gross inpatient revenue. The equivalent admissions computation “equates” outpatient revenue to the volume measure (admissions) used to measure inpatient volume, resulting in a general measure of combined inpatient and outpatient volume. | |
(g) | Represents the average number of days admitted patients stay in our hospitals. | |
(h) | Represents the average number of patients in our hospital beds each day. | |
(i) | Represents the percentage of hospital licensed beds occupied by patients. Both average daily census and occupancy rate provide measures of the utilization of inpatient rooms. | |
(j) | Represents the number of patients treated in our emergency rooms. | |
(k) | Represents the number of surgeries performed on patients who were not admitted to our hospitals. Pain management and endoscopy procedures are not included in outpatient surgeries. | |
(l) | Represents the number of surgeries performed on patients who have been admitted to our hospitals. Pain management and endoscopy procedures are not included in inpatient surgeries. |
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State | Hospitals | Beds | ||||||
Alaska | 1 | 238 | ||||||
California | 5 | 1,504 | ||||||
Colorado | 7 | 2,246 | ||||||
Florida | 38 | 9,900 | ||||||
Georgia | 12 | 2,124 | ||||||
Idaho | 2 | 476 | ||||||
Indiana | 1 | 278 | ||||||
Kansas | 4 | 1,286 | ||||||
Kentucky | 2 | 384 | ||||||
Louisiana | 11 | 1,748 | ||||||
Mississippi | 1 | 130 | ||||||
Missouri | 7 | 1,222 | ||||||
Nevada | 3 | 1,075 | ||||||
New Hampshire | 2 | 295 | ||||||
Oklahoma | 2 | 942 | ||||||
South Carolina | 3 | 740 | ||||||
Tennessee | 13 | 2,297 | ||||||
Texas | 35 | 9,896 | ||||||
Utah | 6 | 932 | ||||||
Virginia | 10 | 2,963 | ||||||
International | ||||||||
Switzerland | 2 | 220 | ||||||
England | 6 | 704 | ||||||
173 | 41,600 | |||||||
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Votes in Favor | Votes Against | Abstentions | ||||||||||
To adopt the Agreement and Plan of Merger, dated as of July 24, 2006, by and among the Company, Hercules Holding II, LLC, a Delaware limited liability company, and Hercules Acquisition Corporation, a Delaware corporation and a wholly-owned subsidiary of Hercules Holding II, LLC | 283,539,958 | 31,968,124 | 4,830,055 |
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2006 | 2005 | 2004 | 2003 | 2002 | ||||||||||||||||||
Summary of Operations: | ||||||||||||||||||||||
Revenues | $ | 25,477 | $ | 24,455 | $ | 23,502 | $ | 21,808 | $ | 19,729 | ||||||||||||
Salaries and benefits | 10,409 | 9,928 | 9,419 | 8,682 | 7,952 | |||||||||||||||||
Supplies | 4,322 | 4,126 | 3,901 | 3,522 | 3,158 | |||||||||||||||||
Other operating expenses | 4,057 | 4,039 | 3,797 | 3,676 | 3,341 | |||||||||||||||||
Provision for doubtful accounts | 2,660 | 2,358 | 2,669 | 2,207 | 1,581 | |||||||||||||||||
(Gains) losses on investments | (243 | ) | (53 | ) | (56 | ) | (1 | ) | 2 | |||||||||||||
Equity in earnings of affiliates | (197 | ) | (221 | ) | (194 | ) | (199 | ) | (206 | ) | ||||||||||||
Depreciation and amortization | 1,391 | 1,374 | 1,250 | 1,112 | 1,010 | |||||||||||||||||
Interest expense | 955 | 655 | 563 | 491 | 446 | |||||||||||||||||
Gains on sales of facilities | (205 | ) | (78 | ) | — | (85 | ) | (6 | ) | |||||||||||||
Transaction costs | 442 | — | — | — | — | |||||||||||||||||
Impairment of long-lived assets | 24 | — | 12 | 130 | 19 | |||||||||||||||||
Government settlement and investigation related costs | — | — | — | (33 | ) | 661 | ||||||||||||||||
Impairment of investment securities | — | — | — | — | 168 | |||||||||||||||||
23,615 | 22,128 | 21,361 | 19,502 | 18,126 | ||||||||||||||||||
Income before minority interests and income taxes | 1,862 | 2,327 | 2,141 | 2,306 | 1,603 | |||||||||||||||||
Minority interests in earnings of consolidated entities | 201 | 178 | 168 | 150 | 148 | |||||||||||||||||
Income before income taxes | 1,661 | 2,149 | 1,973 | 2,156 | 1,455 | |||||||||||||||||
Provision for income taxes | 625 | 725 | 727 | 824 | 622 | |||||||||||||||||
Net income | $ | 1,036 | $ | 1,424 | $ | 1,246 | $ | 1,332 | $ | 833 | ||||||||||||
Financial Position: | ||||||||||||||||||||||
Assets | $ | 23,675 | $ | 22,225 | $ | 21,840 | $ | 21,400 | $ | 19,059 | ||||||||||||
Working capital | 2,502 | 1,320 | 1,509 | 1,654 | 766 | |||||||||||||||||
Long-term debt, including amounts due within one year | 28,408 | 10,475 | 10,530 | 8,707 | 6,943 | |||||||||||||||||
Minority interests in equity of consolidated entities | 907 | 828 | 809 | 680 | 611 | |||||||||||||||||
Equity securities with contingent redemption rights | 125 | — | — | — | — | |||||||||||||||||
Stockholders’ (deficit) equity | (11,374 | ) | 4,863 | 4,407 | 6,209 | 5,702 | ||||||||||||||||
Cash Flow Data: | ||||||||||||||||||||||
Cash provided by operating activities | $ | 1,845 | $ | 2,971 | $ | 2,954 | $ | 2,292 | $ | 2,648 | ||||||||||||
Cash used in investing activities | (1,307 | ) | (1,681 | ) | (1,688 | ) | (2,862 | ) | (1,740 | ) | ||||||||||||
Cash (used in) provided by financing activities | (240 | ) | (1,212 | ) | (1,347 | ) | 650 | (934 | ) | |||||||||||||
Operating Data: | ||||||||||||||||||||||
Number of hospitals at end of period(a) | 166 | 175 | 182 | 184 | 173 | |||||||||||||||||
Number of freestanding outpatient surgical centers at end of period(b) | 98 | 87 | 84 | 79 | 74 | |||||||||||||||||
Number of licensed beds at end of period(c) | 39,354 | 41,265 | 41,852 | 42,108 | 39,932 | |||||||||||||||||
Weighted average licensed beds(d) | 40,653 | 41,902 | 41,997 | 41,568 | 39,985 | |||||||||||||||||
Admissions(e) | 1,610,100 | 1,647,800 | 1,659,200 | 1,635,200 | 1,582,800 | |||||||||||||||||
Equivalent admissions(f) | 2,416,700 | 2,476,600 | 2,454,000 | 2,405,400 | 2,339,400 | |||||||||||||||||
Average length of stay (days)(g) | 4.9 | 4.9 | 5.0 | 5.0 | 5.0 | |||||||||||||||||
Average daily census(h) | 21,688 | 22,225 | 22,493 | 22,234 | 21,509 | |||||||||||||||||
Occupancy(i) | 53 | % | 53 | % | 54 | % | 54 | % | 54 | % | ||||||||||||
Emergency room visits(j) | 5,213,500 | 5,415,200 | 5,219,500 | 5,160,200 | 4,802,800 | |||||||||||||||||
Outpatient surgeries(k) | 820,900 | 836,600 | 834,800 | 814,300 | 809,900 | |||||||||||||||||
Inpatient surgeries(l) | 533,100 | 541,400 | 541,000 | 528,600 | 518,100 | |||||||||||||||||
Days revenues in accounts receivable(m) | 53 | 50 | 48 | 52 | 52 | |||||||||||||||||
Gross patient revenues(n) | $ | 84,913 | $ | 78,662 | $ | 71,279 | $ | 62,626 | $ | 53,542 | ||||||||||||
Outpatient revenues as a % of patient revenues(o) | 36 | % | 36 | % | 37 | % | 37 | % | 37 | % |
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(m) | Revenues per day is calculated by dividing the revenues for the period by the days in the period. Days revenues in accounts receivable is then calculated as accounts receivable, net of the allowance for doubtful accounts, at the end of the period divided by revenues per day. | |
(n) | Gross patient revenues are based upon our standard charge listing. Gross charges/revenues typically do not reflect what our hospital facilities are paid. Gross charges/revenues are reduced by contractual adjustments, discounts and charity care to determine reported revenues. | |
(o) | Represents the percentage of patient revenues related to patients who are not admitted to our hospitals. |
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Item 7. | Management’s Discussion and Analysis of Financial Condition and Results of Operations |
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• | expanding the number of high quality specialty services, such as cardiology, orthopedics, oncology and neonatology; | |
• | continuing to use joint ventures with physicians to further develop our outpatient business, particularly through ambulatory surgery centers and outpatient diagnostic centers; | |
• | developing medical office buildings to provide convenient facilities for physicians to locate their practices and serve their patients; and | |
• | continuing our focus on improving hospital quality and performance and implementing advanced technologies in our facilities to attract physicians to our facilities. |
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% of Accounts Receivable | ||||||||||||
Under 91 Days | 91—180 Days | Over 180 Days | ||||||||||
Accounts receivable aging at December 31, 2007: | ||||||||||||
Medicare and Medicaid | 11 | % | 1 | % | 2 | % | ||||||
Managed care and other insurers | 19 | 4 | 4 | |||||||||
Uninsured | 20 | 11 | 28 | |||||||||
Total | 50 | % | 16 | % | 34 | % | ||||||
Accounts receivable aging at December 31, 2006: | ||||||||||||
Medicare and Medicaid | 13 | % | 1 | % | 2 | % | ||||||
Managed care and other insurers | 21 | 4 | 4 | |||||||||
Uninsured | 20 | 11 | 24 | |||||||||
Total | 54 | % | 16 | % | 30 | % | ||||||
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% of Accounts Receivable | ||||||||||||||
Under 91 Days | 91 — 180 Days | Over 180 Days | ||||||||||||
Accounts receivable aging at December 31, 2006: | ||||||||||||||
Medicare and Medicaid | 13 | % | 1 | % | 2 | % | ||||||||
Managed care and other insurers | 21 | 4 | 4 | |||||||||||
Uninsured | 20 | 11 | 24 | |||||||||||
Total | 54 | % | 16 | % | 30 | % | ||||||||
Accounts receivable aging at December 31, 2005: | ||||||||||||||
Medicare and Medicaid | 13 | % | 2 | % | 2 | % | ||||||||
Managed care and other insurers | 21 | 4 | 4 | |||||||||||
Uninsured | 21 | 11 | 22 | |||||||||||
Total | 55 | % | 17 | % | 28 | % | ||||||||
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Years Ended December 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Medicare | 37 | % | 38 | % | 39 | % | ||||||
Managed Medicare | 6 | (a | ) | (a | ) | |||||||
Medicaid | 9 | 10 | 10 | |||||||||
Managed Medicaid | 6 | 5 | 4 | |||||||||
Managed care and other insurers(a) | 36 | 42 | 42 | |||||||||
Uninsured | 6 | 5 | 5 | |||||||||
100 | % | 100 | % | 100 | % | |||||||
Years Ended December 31, | ||||||||||||
2007 | 2006 | 2005 | ||||||||||
Medicare | 35 | % | 37 | % | 38 | % | ||||||
Managed Medicare | 7 | 6 | (a | ) | ||||||||
Medicaid | 8 | 9 | 10 | |||||||||
Managed Medicaid | 7 | 6 | 5 | |||||||||
Managed care and other insurers(a) | 37 | 36 | 42 | |||||||||
Uninsured | 6 | 6 | 5 | |||||||||
100 | % | 100 | % | 100 | % | |||||||
(a) | Prior to 2006, managed Medicare admissions were classified as managed care. |
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Years Ended December 31, | ||||||||||||
2006 | 2005 | 2004 | ||||||||||
Medicare | 34 | % | 36 | % | 37 | % | ||||||
Managed Medicare | 6 | (a | ) | (a | ) | |||||||
Medicaid | 6 | 7 | 6 | |||||||||
Managed Medicaid | 3 | 3 | 3 | |||||||||
Managed care and other insurers(a) | 46 | 49 | 48 | |||||||||
Uninsured(b) | 5 | 5 | 6 | |||||||||
100 | % | 100 | % | 100 | % | |||||||
Years Ended December 31, | ||||||||||||
2007 | 2006 | 2005 | ||||||||||
Medicare | 32 | % | 34 | % | 36 | % | ||||||
Managed Medicare | 7 | 6 | (a | ) | ||||||||
Medicaid | 7 | 6 | 7 | |||||||||
Managed Medicaid | 4 | 3 | 3 | |||||||||
Managed care and other insurers(a) | 44 | 46 | 49 | |||||||||
Uninsured | 6 | 5 | 5 | |||||||||
100 | % | 100 | % | 100 | % | |||||||
(a) | Prior to 2006, managed Medicare revenues were classified as managed care. | |
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2006 | 2005 | 2004 | |||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | ||||||||||||||||||||
Revenues | $ | 25,477 | 100.0 | $ | 24,455 | 100.0 | $ | 23,502 | 100.0 | ||||||||||||||||
Salaries and benefits | 10,409 | 40.9 | 9,928 | 40.6 | 9,419 | 40.1 | |||||||||||||||||||
Supplies | 4,322 | 17.0 | 4,126 | 16.9 | 3,901 | 16.6 | |||||||||||||||||||
Other operating expenses | 4,057 | 16.0 | 4,039 | 16.5 | 3,797 | 16.0 | |||||||||||||||||||
Provision for doubtful accounts | 2,660 | 10.4 | 2,358 | 9.6 | 2,669 | 11.4 | |||||||||||||||||||
Gains on investments | (243 | ) | (1.0 | ) | (53 | ) | (0.2 | ) | (56 | ) | (0.2 | ) | |||||||||||||
Equity in earnings of affiliates | (197 | ) | (0.8 | ) | (221 | ) | (0.9 | ) | (194 | ) | (0.8 | ) | |||||||||||||
Depreciation and amortization | 1,391 | 5.5 | 1,374 | 5.6 | 1,250 | 5.3 | |||||||||||||||||||
Interest expense | 955 | 3.7 | 655 | 2.7 | 563 | 2.4 | |||||||||||||||||||
Gains on sales of facilities | (205 | ) | (0.8 | ) | (78 | ) | (0.3 | ) | — | — | |||||||||||||||
Transaction costs | 442 | 1.7 | — | — | — | — | |||||||||||||||||||
Impairment of long-lived assets | 24 | 0.1 | — | — | 12 | 0.1 | |||||||||||||||||||
23,615 | 92.7 | 22,128 | 90.5 | 21,361 | 90.9 | ||||||||||||||||||||
Income before minority interests and income taxes | 1,862 | 7.3 | 2,327 | 9.5 | 2,141 | 9.1 | |||||||||||||||||||
Minority interests in earnings of consolidated entities | 201 | 0.8 | 178 | 0.7 | 168 | 0.7 | |||||||||||||||||||
Income before income taxes | 1,661 | 6.5 | 2,149 | 8.8 | 1,973 | 8.4 | |||||||||||||||||||
Provision for income taxes | 625 | 2.4 | 725 | 3.0 | 727 | 3.1 | |||||||||||||||||||
Net income | $ | 1,036 | 4.1 | $ | 1,424 | 5.8 | $ | 1,246 | 5.3 | ||||||||||||||||
% changes from prior year: | |||||||||||||||||||||||||
Revenues | 4.2 | % | 4.1 | % | 7.8 | % | |||||||||||||||||||
Income before income taxes | (22.7 | ) | 9.0 | (8.5 | ) | ||||||||||||||||||||
Net income | (27.2 | ) | 14.2 | (6.5 | ) | ||||||||||||||||||||
Admissions(a) | (2.3 | ) | (0.7 | ) | 1.5 | ||||||||||||||||||||
Equivalent admissions(b) | (2.4 | ) | 0.9 | 2.0 | |||||||||||||||||||||
Revenue per equivalent admission | 6.8 | 3.1 | 5.6 | ||||||||||||||||||||||
Same facility % changes from prior year(c): | |||||||||||||||||||||||||
Revenues | 6.2 | 4.7 | 7.3 | ||||||||||||||||||||||
Admissions(a) | 0.2 | 0.1 | 0.7 | ||||||||||||||||||||||
Equivalent admissions(b) | — | 1.4 | 1.3 | ||||||||||||||||||||||
Revenue per equivalent admission | 6.2 | 3.2 | 6.0 |
2007 | 2006 | 2005 | ||||||||||||||||||||||
Amount | Ratio | Amount | Ratio | Amount | Ratio | |||||||||||||||||||
Revenues | $ | 26,858 | 100.0 | $ | 25,477 | 100.0 | $ | 24,455 | 100.0 | |||||||||||||||
Salaries and benefits | 10,714 | 39.9 | 10,409 | 40.9 | 9,928 | 40.6 | ||||||||||||||||||
Supplies | 4,395 | 16.4 | 4,322 | 17.0 | 4,126 | 16.9 | ||||||||||||||||||
Other operating expenses | 4,241 | 15.7 | 4,056 | 16.0 | 4,034 | 16.5 | ||||||||||||||||||
Provision for doubtful accounts | 3,130 | 11.7 | 2,660 | 10.4 | 2,358 | 9.6 | ||||||||||||||||||
Gains on investments | (8 | ) | — | (243 | ) | (1.0 | ) | (53 | ) | (0.2 | ) | |||||||||||||
Equity in earnings of affiliates | (206 | ) | (0.8 | ) | (197 | ) | (0.8 | ) | (221 | ) | (0.9 | ) | ||||||||||||
Depreciation and amortization | 1,426 | 5.4 | 1,391 | 5.5 | 1,374 | 5.6 | ||||||||||||||||||
Interest expense | 2,215 | 8.2 | 955 | 3.7 | 655 | 2.7 | ||||||||||||||||||
Gains on sales of facilities | (471 | ) | (1.8 | ) | (205 | ) | (0.8 | ) | (78 | ) | (0.3 | ) | ||||||||||||
Impairment of long-lived assets | 24 | 0.1 | 24 | 0.1 | — | — | ||||||||||||||||||
Transaction costs | — | — | 442 | 1.7 | — | — | ||||||||||||||||||
25,460 | 94.8 | 23,614 | 92.7 | 22,123 | 90.5 | |||||||||||||||||||
Income before minority interests and income taxes | 1,398 | 5.2 | 1,863 | 7.3 | 2,332 | 9.5 | ||||||||||||||||||
Minority interests in earnings of consolidated entities | 208 | 0.8 | 201 | 0.8 | 178 | 0.7 | ||||||||||||||||||
Income before income taxes | 1,190 | 4.4 | 1,662 | 6.5 | 2,154 | 8.8 | ||||||||||||||||||
Provision for income taxes | 316 | 1.1 | 626 | 2.4 | 730 | 3.0 | ||||||||||||||||||
Net income | $ | 874 | 3.3 | $ | 1,036 | 4.1 | $ | 1,424 | 5.8 | |||||||||||||||
% changes from prior year: | ||||||||||||||||||||||||
Revenues | 5.4 | % | 4.2 | % | 4.1 | % | ||||||||||||||||||
Income before income taxes | (28.4 | ) | (22.9 | ) | 7.7 | |||||||||||||||||||
Net income | (15.7 | ) | (27.2 | ) | 14.2 | |||||||||||||||||||
Admissions(a) | (3.6 | ) | (2.3 | ) | (0.7 | ) | ||||||||||||||||||
Equivalent admissions(b) | (2.7 | ) | (2.4 | ) | 0.9 | |||||||||||||||||||
Revenue per equivalent admission | 8.3 | 6.8 | 3.1 | |||||||||||||||||||||
Same facility % changes from prior year(c): | ||||||||||||||||||||||||
Revenues | 7.4 | 6.2 | 4.7 | |||||||||||||||||||||
Admissions(a) | (1.3 | ) | 0.2 | 0.1 | ||||||||||||||||||||
Equivalent admissions(b) | (0.7 | ) | — | 1.4 | ||||||||||||||||||||
Revenue per equivalent admission | 8.1 | 6.2 | 3.2 |
(a) | Represents the total number of patients admitted to our hospitals and is used by management and certain investors as a general measure of inpatient volume. | |
(b) | Equivalent admissions are used by management and certain investors as a general measure of combined inpatient and outpatient volume. Equivalent admissions are computed by multiplying admissions (inpatient volume) by the sum of gross inpatient revenue and gross outpatient revenue and then dividing the resulting amount by gross inpatient revenue. The equivalent admissions computation “equates” outpatient revenue to the volume measure (admissions) used to measure inpatient volume, resulting in a general measure of combined inpatient and outpatient volume. | |
(c) | Same facility information excludes the operations of hospitals and their related facilities that were either acquired, divested or removed from service during the current and prior year. |
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Year Ended December 31, 2006 | ||||||||||||||||||||||||||||
Non-GAAP | ||||||||||||||||||||||||||||
% of | ||||||||||||||||||||||||||||
GAAP % | Adjusted | |||||||||||||||||||||||||||
Reported | Uninsured | Non-GAAP | of Revenues | Revenues | ||||||||||||||||||||||||
GAAP(a) | Discounts | Adjusted | ||||||||||||||||||||||||||
Amounts | Adjustment(b) | Amounts(c) | 2006 | 2005 | 2006 | 2005 | ||||||||||||||||||||||
Revenues | $ | 25,477 | $ | 1,095 | $ | 26,572 | 100.0 | % | 100.0 | % | 100.0 | % | 100.0 | % | ||||||||||||||
Salaries and benefits | 10,409 | — | 10,409 | 40.9 | 40.6 | 39.2 | 39.4 | |||||||||||||||||||||
Supplies | 4,322 | — | 4,322 | 17.0 | 16.9 | 16.3 | 16.4 | |||||||||||||||||||||
Other operating expenses | 4,057 | — | 4,057 | 16.0 | 16.5 | 15.2 | 15.9 | |||||||||||||||||||||
Provision for doubtful accounts | 2,660 | 1,095 | 3,755 | 10.4 | 9.6 | 14.1 | 12.4 | |||||||||||||||||||||
Admissions | 1,610,100 | 1,610,100 | ||||||||||||||||||||||||||
Equivalent admissions | 2,416,700 | 2,416,700 | ||||||||||||||||||||||||||
Revenue per equivalent admission | $ | 10,542 | $ | 10,995 | ||||||||||||||||||||||||
% change from prior year | 6.8 | % | 8.0 | % | ||||||||||||||||||||||||
Same Facility(d): | ||||||||||||||||||||||||||||
Revenues | $ | 24,448 | $ | 1,063 | $ | 25,511 | ||||||||||||||||||||||
Admissions | 1,557,700 | 1,557,700 | ||||||||||||||||||||||||||
Equivalent admissions | 2,322,500 | 2,322,500 | ||||||||||||||||||||||||||
Revenue per equivalent admission | $ | 10,527 | $ | 10,984 | ||||||||||||||||||||||||
% change from prior year | 6.2 | % | 7.3 | % |
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Payments Due by Period | ||||||||||||||||||||
Contractual Obligations(a) | Total | Current | 2-3 Years | 4-5 Years | After 5 Years | |||||||||||||||
Long-term debt including interest, excluding the senior secured credit facilities(b) | $ | 25,272 | $ | 1,197 | $ | 2,370 | $ | 3,745 | $ | 17,960 | ||||||||||
Loans outstanding under the senior secured credit facilities, including interest(b) | 22,535 | 1,390 | 2,892 | 3,235 | 15,018 | |||||||||||||||
Operating leases(c) | 1,287 | 236 | 348 | 199 | 504 | |||||||||||||||
Purchase and other obligations(c) | 27 | 17 | 5 | 5 | — | |||||||||||||||
Total contractual obligations | $ | 49,121 | $ | 2,840 | $ | 5,615 | $ | 7,184 | $ | 33,482 | ||||||||||
Commitment Expiration by Period | ||||||||||||||||||||
Other Commercial Commitments | ||||||||||||||||||||
Not Recorded on the Consolidated Balance Sheet | Total | Current | 2-3 Years | 4-5 Years | After 5 Years | |||||||||||||||
Letters of credit(d) | $ | 134 | $ | 46 | $ | — | $ | — | $ | 88 | ||||||||||
Surety bonds(e) | 131 | 126 | 5 | — | — | |||||||||||||||
Physician commitments(f) | 37 | 34 | 2 | 1 | — | |||||||||||||||
Guarantees(g) | 2 | — | — | — | 2 | |||||||||||||||
Total commercial commitments | $ | 304 | $ | 206 | $ | 7 | $ | 1 | $ | 90 | ||||||||||
Payments Due by Period | ||||||||||||||||||||||||
Contractual Obligations(a) | Total | Current | 2-3 Years | 4-5 Years | After 5 Years | |||||||||||||||||||
Long-term debt including interest, excluding the senior secured credit facilities(b) | $ | 24,250 | $ | 1,207 | $ | 3,440 | $ | 3,468 | $ | 16,135 | ||||||||||||||
Loans outstanding under the senior secured credit facilities, including interest(b) | 19,433 | 1,250 | 2,725 | 5,650 | 9,808 | |||||||||||||||||||
Operating leases(c) | 1,218 | 216 | 332 | 197 | 473 | |||||||||||||||||||
Purchase and other obligations(c) | 33 | 25 | 5 | 3 | — | |||||||||||||||||||
Total contractual obligations | $ | 44,934 | $ | 2,698 | $ | 6,502 | $ | 9,318 | $ | 26,416 | ||||||||||||||
Commitment Expiration by Period | ||||||||||||||||||||||||
Other Commercial Commitments Not Recorded on the Consolidated Balance Sheet | Total | Current | 2-3 Years | 4-5 Years | After 5 Years | |||||||||||||||||||
Surety bonds(d) | $ | 166 | $ | 163 | $ | 3 | $ | — | $ | — | ||||||||||||||
Letters of credit(e) | 145 | 49 | — | 54 | 42 | |||||||||||||||||||
Physician commitments(f) | 44 | 42 | 2 | — | — | |||||||||||||||||||
Guarantees(g) | 2 | — | — | — | 2 | |||||||||||||||||||
Total commercial commitments | $ | 357 | $ | 254 | $ | 5 | $ | 54 | $ | 44 | ||||||||||||||
(a) | We have not included obligations to pay estimated professional liability claims ($ |
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(b) | Estimate of interest payments assumes that interest rates, borrowing spreads and foreign currency exchange rates at December 31, | |
(c) | Future operating lease obligations and purchase obligations are not recorded in our consolidated balance sheet. | |
(d) | ||
Amounts relate primarily to instances in which we have agreed to indemnify various commercial insurers who have provided surety bonds to cover damages for malpractice cases which were awarded to plaintiffs by the courts. These cases are currently under appeal and the bonds will not be released by the courts until the cases are closed. | ||
(e) | Amounts relate primarily to instances in which we have letters of credit outstanding with insurance companies that issued workers compensation insurance policies to us in prior years. The letters of credit serve as security to the insurance companies for payment obligations we retained. |
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(f) | In consideration for physicians relocating to the communities in which our hospitals are located and agreeing to engage in private practice for the benefit of the respective communities, we make advances to physicians, normally over a period of one year, to assist in establishing the physicians’ practices. The actual amount of these commitments to be advanced often depends upon the financial results of the physicians’ private practices during the recruitment agreement payment period. The physician commitments reflected were based on our maximum exposure on effective agreements at December 31, | |
(g) | We have entered into guarantee agreements related to certain leases. |
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Item 7A. | Quantitative and Qualitative Disclosures about Market Risk |
Item 8. | Financial Statements and Supplementary Data |
Item 9. | Changes in and Disagreements with Accountants on Accounting and Financial Disclosure |
Item 9A. | Controls and Procedures |
1. | Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures |
2. | Internal Control Over Financial Reporting |
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Item 9B. |
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Item 10. | Directors, Executive Officers and Corporate Governance |
Director | ||||||||||
Name | Age | Since | Position(s) | |||||||
Jack O. Bovender, Jr. | 61 | 1999 | Chairman of the Board and Chief Executive Officer | |||||||
Christopher J. Birosak | 52 | 2006 | Director | |||||||
George A. Bitar | 42 | 2006 | Director | |||||||
Richard M. Bracken | 54 | 2002 | President, Chief Operating Officer and Director | |||||||
John P. Connaughton | 40 | 2006 | Director | |||||||
Thomas F. Frist, Jr., M.D. | 68 | 1994 | Director | |||||||
Thomas F. Frist III | 39 | 2006 | Director | |||||||
Christopher R. Gordon | 34 | 2006 | Director | |||||||
Michael W. Michelson | 55 | 2006 | Director | |||||||
James C. Momtazee | 35 | 2006 | Director | |||||||
Stephen G. Pagliuca | 52 | 2006 | Director | |||||||
Peter M. Stavros | 32 | 2006 | Director | |||||||
Nathan C. Thorne | 53 | 2006 | Director |
Director | ||||||||||
Name | Age | Since | Position(s) | |||||||
Jack O. Bovender, Jr. | 62 | 1999 | Chairman of the Board and Chief Executive Officer | |||||||
Christopher J. Birosak | 53 | 2006 | Director | |||||||
George A. Bitar | 43 | 2006 | Director | |||||||
Richard M. Bracken | 55 | 2002 | President, Chief Operating Officer and Director | |||||||
John P. Connaughton | 42 | 2006 | Director | |||||||
Thomas F. Frist, Jr., M.D | 69 | 1994 | Director | |||||||
Thomas F. Frist III | 40 | 2006 | Director | |||||||
Christopher R. Gordon | 35 | 2006 | Director | |||||||
Michael W. Michelson | 56 | 2006 | Director | |||||||
James C. Momtazee | 36 | 2006 | Director | |||||||
Stephen G. Pagliuca | 53 | 2006 | Director | |||||||
Peter M. Stavros | 33 | 2006 | Director | |||||||
Nathan C. Thorne | 54 | 2006 | Director |
Name | Age | Position(s) | |||||
R. Milton Johnson | Executive Vice President and Chief Financial Officer | ||||||
David G. Anderson | Senior Vice President — Finance and Treasurer | ||||||
Victor L. Campbell | Senior Vice President | ||||||
Rosalyn S. Elton | Senior Vice President — Operations Finance | ||||||
V. Carl George | Senior Vice President — Development | ||||||
Charles J. Hall | 54 | President — Eastern Group | |||||
R. Sam Hankins, Jr. | Chief Financial Officer — Outpatient Services Group | ||||||
Russell K. Harms | Chief Financial Officer — Central Group | ||||||
Samuel N. Hazen | President — Western Group | ||||||
A. Bruce Moore, Jr. | President — Outpatient Services Group | ||||||
Jonathan B. Perlin | President — Clinical Services Group and Chief Medical Officer | ||||||
W. Paul Rutledge | President — Central Group | ||||||
Richard J. Shallcross | Chief Financial Officer — Western Group | ||||||
Joseph N. Steakley | Senior Vice President — Internal Audit Services | ||||||
John M. Steele | Senior Vice President — Human Resources | ||||||
Donald W. Stinnett | Chief Financial Officer — Eastern Group | ||||||
Beverly B. Wallace | President — Shared Services Group | ||||||
Robert A. Waterman | Senior Vice President and General Counsel | ||||||
Noel Brown Williams | Senior Vice President and Chief Information Officer | ||||||
Alan R. Yuspeh | Senior Vice President |
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Item 11. | Executive Compensation |
• | Executive compensation strategy and philosophy; | |
• | Compensation arrangements for executive management; |
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• | Design and administration of the annual cash-based Senior Officer Performance Excellence Program (“PEP”); | |
• | Design and administration of our equity incentive plans; | |
• | Executive benefits and perquisites (including the HCA Restoration Plan and the Supplemental Executive Retirement Plan); and | |
• | Any other executive compensation or benefits related items deemed noteworthy by the Committee. |
Jack O. Bovender, Jr., Chairman of the Board and Chief Executive Officer; | ||
• | Richard M. Bracken, President and Chief Operating Officer; | |
• | R. Milton Johnson, Executive Vice President and Chief Financial Officer; | |
• | Samuel N. Hazen, President — Western Group; and | |
• | Beverly B. Wallace, President — Shared Services Group |
• | Reinforces HCA’s strategic imperatives; | |
• | Aligns the economic interests of our executives with those of our shareholders; and | |
• | Encourages attraction and long term retention of key contributors. |
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Total Direct Compensation | • Base Salary • Annual Cash-Based Incentives (offered through our PEP) • Long-Term Equity Incentives (in the form of Stock Options) | |
Other Benefits | • Retirement Plans • Limited Perquisites and Other Personal Benefits • Severance Benefits |
Number of | ||||||
Companies in | ||||||
Survey | Revenue Scope (Median Revenue) | Sample | ||||
Towers Perrin | Greater than $20B ($35B) | 61 | ||||
Hewitt Associates | $10B - $25B ($14.0B) | 66 | ||||
Hewitt Associates | Greater than $25B ($46.9B) | 43 | ||||
Pearl Meyer | $20B - $30B ($25.4B) | 12 |
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• | ||
• | ||
• | It is the key metric driving the valuation in the internal Company model, consistent with the valuation approach used by industry analysts; and | |
• |
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2007 Target PEP | 2007 Actual PEP Award | |||||||
Named Executive Officer | (% of Salary) | (% of Salary) | ||||||
Jack O. Bovender, Jr. (Chairman and CEO) | 120 | % | 240 | % | ||||
Richard M. Bracken (President and COO) | 90 | % | 180 | % | ||||
R. Milton Johnson (Executive Vice President and CFO) | 60 | % | 120 | % | ||||
Samuel N. Hazen (President, Western Group) | 60 | % | 105 | % | ||||
Beverly B. Wallace (President, Shared Services Group) | 60 | % | 120 | % |
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• | Promote our long term financial interests and growth by attracting and retaining management and other personnel and key service providers with the training, experience and ability to enable them to make a substantial contribution to the success of our business; | |
• | Motivate management personnel by means of growth-related incentives to achieve long range goals; and | |
• | Further the alignment of interests of participants with those of our shareholders through opportunities for increased stock or stock-based ownership in the Company. |
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• | Recognize significant long-term contributions and commitments by executives to the Company and to performance over an extended period of time; | |
• | Induce our executives to continue in our employ through a specified normal retirement age (initially 62 through 65, but reduced to 60 upon the change in control at the time of the Merger in 2006); and | |
• | Provide a competitive benefit to aid in attracting and retaining key executive talent. |
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• | Subject to restrictive covenants and the signing of a general release of claims, an amount equal to two times for Mr. Hazen and Ms. Wallace and three times in the case of Messrs. Bovender, Bracken, and Johnson the sum of base salary plus PEP paid or payable in respect of the fiscal year immediately preceding the fiscal year in which termination occurs, payable over a two year period; | |
• | Pro-rata bonus; and | |
• | Continued coverage under our group health plans during the period over which the cash severance is paid. |
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Changes in | |||||||||||||||||||||||||||||||||
Pension Value | |||||||||||||||||||||||||||||||||
Non-Equity | and | ||||||||||||||||||||||||||||||||
Restricted | Incentive | Nonqualified | |||||||||||||||||||||||||||||||
Stock | Option | Plan | Deferred | All Other | |||||||||||||||||||||||||||||
Name and Principal | Salary | Awards | Awards | Compensation | Compensation | Compensation | |||||||||||||||||||||||||||
Positions | Year | ($)(1) | ($)(2) | ($)(3) | ($)(4) | Earnings ($)(5) | ($)(6) | Total ($) | |||||||||||||||||||||||||
Jack O. Bovender, Jr. | 2006 | $ | 1,535,137 | $ | 6,393,996 | $ | 6,714,520 | $ | 1,944,274 | $ | 10,715,751 | $ | 1,013,576 | $ | 28,317,254 | ||||||||||||||||||
Chairman and Chief Executive Officer | |||||||||||||||||||||||||||||||||
Richard M. Bracken | 2006 | $ | 952,420 | $ | 2,937,283 | $ | 2,966,787 | $ | 954,785 | $ | 4,912,088 | $ | 514,772 | $ | 13,238,135 | ||||||||||||||||||
President, Chief Operating Officer, Director | |||||||||||||||||||||||||||||||||
R. Milton Johnson | 2006 | $ | 655,016 | $ | 1,820,053 | $ | 1,787,629 | $ | 450,227 | $ | 1,848,700 | $ | 295,160 | $ | 6,856,785 | ||||||||||||||||||
Executive Vice President and Chief Financial Officer | |||||||||||||||||||||||||||||||||
Samuel N. Hazen | 2006 | $ | 688,438 | $ | 1,812,299 | $ | 1,787,629 | $ | 473,203 | $ | 1,828,748 | $ | 329,324 | $ | 6,919,641 | ||||||||||||||||||
President — Western Group | |||||||||||||||||||||||||||||||||
W. Paul Rutledge | 2006 | $ | 537,520 | $ | 1,276,441 | $ | 2,093,442 | $ | 390,000 | $ | 1,648,053 | $ | 242,908 | $ | 6,188,364 | ||||||||||||||||||
President — Central Group | |||||||||||||||||||||||||||||||||
Charles R. Evans | 2006 | $ | 668,455 | $ | 1,738,282 | $ | 2,129,118 | $ | 326,034 | $ | 2,999,679 | $ | 240,148 | $ | 8,101,716 | ||||||||||||||||||
President — Eastern Group* |
Changes in | ||||||||||||||||||||||||||||||||
Pension | ||||||||||||||||||||||||||||||||
Non-Equity | Value and | |||||||||||||||||||||||||||||||
Restricted | Incentive | Nonqualified | ||||||||||||||||||||||||||||||
Stock | Option | Plan | Deferred | All Other | ||||||||||||||||||||||||||||
Name and Principal | Salary | Awards | Awards | Compensation | Compensation | Compensation | ||||||||||||||||||||||||||
Positions | Year | ($)(1) | ($)(2) | ($)(3) | ($)(4) | Earnings ($)(5) | ($)(6) | Total ($) | ||||||||||||||||||||||||
Jack O. Bovender, Jr. | 2007 | $ | 1,620,228 | — | $ | 1,165,087 | $ | 3,888,547 | — | $ | 197,092 | $ | 6,870,954 | |||||||||||||||||||
Chairman and | 2006 | $ | 1,535,137 | $ | 6,393,996 | $ | 6,714,520 | $ | 1,944,274 | $ | 10,715,751 | $ | 1,013,576 | $ | 28,317,254 | |||||||||||||||||
Chief Executive Officer | ||||||||||||||||||||||||||||||||
Richard M. Bracken | 2007 | $ | 1,060,872 | — | $ | 1,019,458 | $ | 1,909,570 | $ | 590,370 | $ | 142,932 | $ | 4,723,202 | ||||||||||||||||||
President, Chief | 2006 | $ | 952,420 | $ | 2,937,283 | $ | 2,966,787 | $ | 954,785 | $ | 4,912,088 | $ | 514,772 | $ | 13,238,135 | |||||||||||||||||
Operating Officer, Director | ||||||||||||||||||||||||||||||||
R. Milton Johnson | 2007 | $ | 750,379 | — | $ | 728,189 | $ | 900,455 | $ | 509,442 | $ | 82,462 | $ | 2,970,927 | ||||||||||||||||||
Executive Vice President | 2006 | $ | 655,016 | $ | 1,820,053 | $ | 1,787,629 | $ | 450,227 | $ | 1,848,700 | $ | 295,160 | $ | 6,856,785 | |||||||||||||||||
and Chief Financial Officer | ||||||||||||||||||||||||||||||||
Samuel N. Hazen | 2007 | $ | 788,672 | — | $ | 466,037 | $ | 830,779 | $ | 258,787 | $ | 84,767 | $ | 2,429,042 | ||||||||||||||||||
President — Western | 2006 | $ | 688,438 | $ | 1,812,299 | $ | 1,787,629 | $ | 473,203 | $ | 1,828,748 | $ | 329,324 | $ | 6,919,641 | |||||||||||||||||
Group | ||||||||||||||||||||||||||||||||
Beverly B. Wallace | 2007 | $ | 700,000 | — | $ | 407,781 | $ | 840,000 | $ | 676,111 | $ | 75,013 | $ | 2,698,905 | ||||||||||||||||||
President — Shared Services Group |
(1) |
Salary amounts for 2006 do not include the value of restricted stock awards granted pursuant to the | ||
(2) | Restricted Stock Awards for 2006 include all compensation expense recognized in our financial statements in 2006 in accordance with SFAS 123(R) with respect to restricted shares awarded to the named executive officers, including restricted shares awarded pursuant to the HCA 2005 Equity Incentive Plan (the “2005 Plan”) and predecessor plans, and restricted shares awarded pursuant to the MSPP. As a result of the Merger, all outstanding restricted shares vested and therefore all compensation expense with respect to restricted shares was recognized in 2006 in accordance with SFAS 123(R). See Note 3 to our consolidated financial statements. | |
(3) | Option Awards for 2007 include the compensation expense recognized in our financial statements for fiscal year 2007 in accordance with SFAS 123(R) with respect to New Options to purchase shares of our common stock awarded to the named executive officers under the 2006 Plan. See Note 3 to our consolidated financial statements. | |
Option Awards for 2006 include all compensation expense recognized in our financial statements for fiscal year 2006 in accordance with SFAS 123(R) with respect to options to purchase shares of our common stock awarded to the named executive officers, including options awarded pursuant to the 2005 Plan and predecessor plans. As a result of the Merger, all options outstanding | ||
(4) | Non-Equity Incentive Plan Compensation for 2007 reflects amounts earned for the year ended December 31, 2007 under the 2007 PEP, which amounts will be paid in the first quarter of 2008 pursuant to the terms of the 2007 PEP. For 2007, the Company exceeded its maximum performance level, as adjusted, with respect to the Company’s EBITDA; therefore, pursuant to the terms of the 2007 PEP, awards under the 2007 PEP will be paid out to the named executive officers, at the maximum level, with the exception of Mr. Hazen, whose award will be paid out at 175.6% of the target amount, due to the 50% of his PEP based on the Western Group EBITDA, which exceeded the target but did not reach the maximum performance level. |
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Non-Equity Incentive Plan Compensation for 2006 reflects amounts paid under the 2006 | ||
(5) | All amounts for 2007 are attributable to |
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Bovender | Bracken | Johnson | Hazen | Wallace | ||||||||||||||||
Passage of Time | $ | (966,974 | ) | $ | 399,630 | $ | 510,118 | $ | 266,066 | $ | 549,404 | |||||||||
Discount Rate Change | $ | (542,195 | ) | $ | (351,603 | ) | $ | (145,992 | ) | $ | (186,325 | ) | $ | (165,945 | ) | |||||
Actual Election | $ | (1,322,788 | ) | $ | 542,343 | $ | 145,315 | $ | 179,046 | $ | 292,652 |
All amounts for 2006 are attributable to increases in value to the SERP benefits. In addition to the assumptions set forth under the table titled “Pension Benefits,” for the purposes of calculating the 2006 figures, benefits are valued assuming a 50% probability of electing a lump sum and a 50% probability of electing an annuity. Messrs. Bovender’s, Bracken’s Johnson’s |
Bovender | Bracken | Johnson | Hazen | Rutledge | Evans | |||||||||||||||||||
Timing of PEP payment | $ | 2,593,533 | $ | 732,167 | $ | 293,215 | $ | 263,193 | $ | 307,300 | $ | 316,971 | ||||||||||||
Change to retirement age | $ | 1,250,090 | $ | 1,535,685 | $ | 576,907 | $ | 620,300 | $ | 556,513 | $ | 746,179 | ||||||||||||
Lump sum provision and actuarial factors | $ | 2,686,511 | $ | 1,372,162 | $ | 678,606 | $ | 657,538 | $ | 585,162 | $ | 530,497 |
Bovender | Bracken | Johnson | Hazen | |||||||||||||
Timing of PEP payment | $ | 2,593,533 | $ | 732,167 | $ | 293,215 | $ | 263,193 | ||||||||
Change to retirement age | $ | 1,250,090 | $ | 1,535,685 | $ | 576,907 | $ | 620,300 | ||||||||
Lump sum provision and actuarial factors | $ | 2,686,511 | $ | 1,372,162 | $ | 678,606 | $ | 657,538 |
(6) | 2007 Amounts consist of: |
• | Company contributions to our Retirement Plan, matching Company contributions to our 401(k) Plan and Company accruals for our Restoration Plan as set forth below. |
Bovender | Bracken | Johnson | Hazen | Wallace | ||||||||||||||||
HCA Retirement Plan | $ | 19,388 | $ | 19,388 | $ | 19,388 | $ | 19,388 | $ | 19,388 | ||||||||||
HCA 401(k) matching contribution | $ | 2,250 | $ | 3,375 | $ | 3,375 | $ | 3,375 | $ | 3,375 | ||||||||||
HCA Restoration Plan | $ | 153,475 | $ | 91,946 | $ | 57,792 | $ | 62,004 | $ | 52,250 |
• | Personal use of corporate aircraft. In 2007, Messrs. Bovender and Bracken were allowed personal use of the Company airplane with an incremental cost of approximately $21,350 and $26,895, respectively, to the Company. Messrs. Johnson and Hazen and Ms. Wallace did not have any personal travel on the Company plane in 2007. We calculate the aggregate incremental cost of the personal use of Company aircraft based on a methodology that includes the average aggregate cost, on a per nautical mile basis, of variable expenses incurred in connection with personal plane usage, including trip-related maintenance, landing fees, fuel, crew hotels and meals, on-board catering, trip-related hangar and parking costs and other variable costs. Because our aircraft are used primarily for business travel, our incremental cost methodology does not include fixed costs of owning and operating aircraft that do not change based on usage. We grossed up the income attributed to Messrs. Bovender and Bracken with respect to certain trips on the Company plane. The additional income |
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2006 Amounts consist of: |
• | The cash payment received as a result of the deemed purchase under the MSPP. Salary amounts withheld on behalf of the participants in the MSPP through the closing date of the Merger were deemed to have been used to purchase shares of our common stock under the terms of the MSPP, using the closing date of the Merger as the last date of the applicable offering period, and then converted into the right to receive a cash payment equal to the number of shares deemed purchased under the MSPP multiplied by $51.00. Salary amounts were refunded to the participants, and they also received a cash payment equal to the difference between $51.00 and the deemed purchase price, multiplied by the number of shares the participant was deemed to have purchased. Messrs. Bovender, Bracken, Johnson | |
• | Company contributions to our Retirement Plan, matching Company contributions to our 401(k) Plan and Company accruals for our Restoration Plan in 2006 as set forth below. |
Bovender | Bracken | Johnson | Hazen | Rutledge | Evans | |||||||||||||||||||
HCA Retirement Plan | $ | 19,019 | $ | 19,019 | $ | 19,019 | $ | 19,019 | $ | 19,019 | $ | 17,290 | ||||||||||||
HCA 401(k) matching contribution | $ | 3,125 | $ | 3,300 | $ | 3,300 | $ | 3,300 | $ | 3,300 | $ | 3,300 | ||||||||||||
HCA Restoration Plan | $ | 856,424 | $ | 409,933 | $ | 212,109 | $ | 247,060 | $ | 172,696 | $ | 181,516 |
Bovender | Bracken | Johnson | Hazen | |||||||||||||
HCA Retirement Plan | $ | 19,019 | $ | 19,019 | $ | 19,019 | $ | 19,019 | ||||||||
HCA 401(k) matching contribution | $ | 3,125 | $ | 3,300 | $ | 3,300 | $ | 3,300 | ||||||||
HCA Restoration Plan | $ | 856,424 | $ | 409,933 | $ | 212,109 | $ | 247,060 |
• | Dividends on restricted shares. On March 1, 2006, June 1, 2006 and September 1, 2006, we paid dividends of $0.15 per share, $0.17 per share and $0.17 per share, respectively, for each issued and outstanding share of common stock of HCA, including restricted shares. Messrs. Bovender, Bracken, Johnson | |
• | Personal use of corporate aircraft. In 2006, each of Messrs. Bovender, Bracken, Johnson |
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Messrs. Bovender and Bracken with respect to certain trips on the Company plane. The additional income attributed to them as a result of gross ups was $1,287 and $522, respectively. In addition, we will pay the travel expenses of our executives’ spouses associated with travel to business related events at which spouse attendance is appropriate. We paid approximately $469 for travel by Mr. Bracken’s wife on a commercial airline for such an event. |
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Fair Value | All Other | |||||||||||||||||||||||||||||||||||
Estimated Possible Payouts | of All | Option | Fair Value of | |||||||||||||||||||||||||||||||||
Under Non-Equity Incentive | All Other | Other | Awards: | Exercise or | All Other | |||||||||||||||||||||||||||||||
Plan Awards ($)(1) | Stock Awards: | Stock | Number of | Base Price of | Option | |||||||||||||||||||||||||||||||
Number of | Awards at | Securities | Option | Awards at | ||||||||||||||||||||||||||||||||
Threshold | Target | Maximum | Shares of | Date of | Underlying | Awards | Date of | |||||||||||||||||||||||||||||
Name | Grant Date | ($) | ($) | ($) | Stock(2) | Grant(2) | Options(3) | ($/sh)(3) | Grant(3) | |||||||||||||||||||||||||||
Jack O. Bovender, Jr. | 1/01/2006 | — | — | — | 2,092 | $ | 26,087 | — | — | — | ||||||||||||||||||||||||||
Jack O. Bovender, Jr. | 1/26/2006 | — | — | — | 66,750 | $ | 3,330,825 | 66,750 | $ | 49.90 | $ | 956,374 | ||||||||||||||||||||||||
Jack O. Bovender, Jr. | 4/26/2006 | — | — | — | — | — | 66,750 | $ | 45.08 | $ | 877,422 | |||||||||||||||||||||||||
Jack O. Bovender, Jr. | 7/01/2006 | — | — | — | 2,367 | $ | 26,842 | — | — | — | ||||||||||||||||||||||||||
Jack O. Bovender, Jr. | 7/26/2006 | — | — | — | — | — | 66,750 | $ | 49.60 | $ | 937,384 | |||||||||||||||||||||||||
Jack O. Bovender, Jr. | 10/26/2006 | — | — | — | — | — | 66,750 | $ | 50.34 | $ | 44,055 | |||||||||||||||||||||||||
Jack O. Bovender, Jr. | N/A | $ | 972,137 | $ | 1,944,274 | $ | 3,888,547 | — | — | — | — | — | ||||||||||||||||||||||||
Richard M. Bracken | 1/01/2006 | — | — | — | 2,740 | $ | 34,168 | — | — | — | ||||||||||||||||||||||||||
Richard M. Bracken | 1/26/2006 | — | — | — | 29,900 | $ | 1,492,010 | 29,900 | $ | 49.90 | $ | 428,398 | ||||||||||||||||||||||||
Richard M. Bracken | 4/26/2006 | — | — | — | — | — | 29,900 | $ | 45.08 | $ | 393,041 | |||||||||||||||||||||||||
Richard M. Bracken | 7/01/2006 | — | — | — | 3,100 | $ | 35,154 | — | — | — | ||||||||||||||||||||||||||
Richard M. Bracken | 7/26/2006 | — | — | — | — | — | 29,900 | $ | 49.60 | $ | 419,892 | |||||||||||||||||||||||||
Richard M. Bracken | 10/26/2006 | — | — | — | — | — | 29,900 | $ | 50.34 | $ | 19,734 | |||||||||||||||||||||||||
Richard M. Bracken | N/A | $ | 477,392 | $ | 954,785 | $ | 1,909,570 | — | — | — | — | — | ||||||||||||||||||||||||
R. Milton Johnson | 1/01/2006 | — | — | — | 1,938 | $ | 24,167 | — | — | — | ||||||||||||||||||||||||||
R. Milton Johnson | 1/26/2006 | — | — | — | 18,100 | $ | 903,190 | 18,125 | $ | 49.90 | $ | 259,690 | ||||||||||||||||||||||||
R. Milton Johnson | 4/26/2006 | — | — | — | — | — | 18,125 | $ | 45.08 | $ | 238,257 | |||||||||||||||||||||||||
R. Milton Johnson | 7/01/2006 | — | — | — | 2,741 | $ | 31,083 | — | — | — | ||||||||||||||||||||||||||
R. Milton Johnson | 7/26/2006 | — | — | — | — | — | 18,125 | $ | 49.60 | $ | 254,533 | |||||||||||||||||||||||||
R. Milton Johnson | 10/26/2006 | — | — | — | — | — | 18,125 | $ | 50.34 | $ | 11,963 | |||||||||||||||||||||||||
R. Milton Johnson | N/A | $ | 225,114 | $ | 450,227 | $ | 900,455 | — | — | — | — | — | ||||||||||||||||||||||||
Samuel N. Hazen | 1/01/2006 | — | — | — | 2,546 | $ | 31,749 | — | — | — | ||||||||||||||||||||||||||
Samuel N. Hazen | 1/26/2006 | — | — | — | 18,100 | $ | 903,190 | 18,125 | $ | 49.90 | $ | 259,690 | ||||||||||||||||||||||||
Samuel N. Hazen | 4/26/2006 | — | — | — | — | — | 18,125 | $ | 45.08 | $ | 238,257 | |||||||||||||||||||||||||
Samuel N. Hazen | 7/01/2006 | — | — | — | 2,881 | $ | 32,671 | — | — | — | ||||||||||||||||||||||||||
Samuel N. Hazen | 7/26/2006 | — | — | — | — | — | 18,125 | $ | 49.60 | $ | 254,533 | |||||||||||||||||||||||||
Samuel N. Hazen | 10/26/2006 | — | — | — | — | — | 18,125 | $ | 50.34 | $ | 11,963 | |||||||||||||||||||||||||
Samuel N. Hazen | N/A | $ | 236,602 | $ | 473,203 | $ | 946,406 | — | — | — | — | — | ||||||||||||||||||||||||
W. Paul Rutledge | 1/01/2006 | — | — | — | 1,855 | $ | 23,132 | — | — | — | ||||||||||||||||||||||||||
W. Paul Rutledge | 1/26/2006 | — | — | — | 18,100 | $ | 903,190 | 18,125 | $ | 49.90 | $ | 259,690 | ||||||||||||||||||||||||
W. Paul Rutledge | 4/26/2006 | — | — | — | — | — | 18,125 | $ | 45.08 | $ | 238,257 | |||||||||||||||||||||||||
W. Paul Rutledge | 7/01/2006 | — | — | — | 2,204 | $ | 24,993 | — | — | — | ||||||||||||||||||||||||||
W. Paul Rutledge | 7/26/2006 | — | — | — | — | — | 18,125 | $ | 49.60 | $ | 254,533 | |||||||||||||||||||||||||
W. Paul Rutledge | 10/26/2006 | — | — | — | — | — | 18,125 | $ | 50.34 | $ | 11,963 | |||||||||||||||||||||||||
W. Paul Rutledge | N/A | $ | 195,000 | $ | 390,000 | $ | 780,000 | — | — | — | — | — | ||||||||||||||||||||||||
Charles R. Evans | 1/01/2006 | — | — | — | 1,404 | $ | 17,508 | — | — | — | ||||||||||||||||||||||||||
Charles R. Evans | 1/26/2006 | — | — | — | 18,100 | $ | 903,190 | 18,125 | $ | 49.90 | $ | 259,690 | ||||||||||||||||||||||||
Charles R. Evans | 4/26/2006 | — | — | — | — | — | 18,125 | $ | 45.08 | $ | 238,257 | |||||||||||||||||||||||||
Charles R. Evans | 7/01/2006 | — | — | — | 1,588 | $ | 18,008 | — | — | — |
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Fair Value | All Other | |||||||||||||||||||||||||||||||||||
Estimated Possible Payouts | of All | Option | Fair Value of | |||||||||||||||||||||||||||||||||
Under Non-Equity Incentive | All Other | Other | Awards: | Exercise or | All Other | |||||||||||||||||||||||||||||||
Plan Awards ($)(1) | Stock Awards: | Stock | Number of | Base Price of | Option | |||||||||||||||||||||||||||||||
Number of | Awards at | Securities | Option | Awards at | ||||||||||||||||||||||||||||||||
Threshold | Target | Maximum | Shares of | Date of | Underlying | Awards | Date of | |||||||||||||||||||||||||||||
Name | Grant Date | ($) | ($) | ($) | Stock(2) | Grant(2) | Options(3) | ($/sh)(3) | Grant(3) | |||||||||||||||||||||||||||
Charles R. Evans | 7/26/2006 | — | — | — | — | — | 18,125 | $ | 49.60 | $ | 254,533 | |||||||||||||||||||||||||
Charles R. Evans | 10/26/2006 | — | — | — | — | — | 18,125 | $ | 50.34 | $ | 11,963 | |||||||||||||||||||||||||
Charles R. Evans | N/A | $ | 163,017 | $ | 326,034 | $ | 652,069 | — | — | — | — | — |
All Other | ||||||||||||||||||||||||||||||||||||||
Option | ||||||||||||||||||||||||||||||||||||||
Estimated Possible Payouts | Estimated Possible Payouts | Awards: | Exercise or | |||||||||||||||||||||||||||||||||||
Under Non-Equity Incentive | Under Equity Incentive | Number of | Base Price | Grant Date | ||||||||||||||||||||||||||||||||||
Plan Awards ($)(1) | Plan Awards (#)(2) | Securities | of Option | Fair Value | ||||||||||||||||||||||||||||||||||
Threshold | Target | Maximum | Threshold | Target | Maximum | Underlying | Awards | of Option | ||||||||||||||||||||||||||||||
Name | Grant Date | ($) | ($) | ($) | (#) | (#) | (#) | Options(2) | ($/sh)(2) | Awards(2) | ||||||||||||||||||||||||||||
Jack O. Bovender, Jr | 1/30/2007 | — | — | — | — | 266,402 | — | 133,202 | $ | 51.00 | $ | 6,355,037 | ||||||||||||||||||||||||||
Jack O. Bovender, Jr | N/A | $ | 972,137 | $ | 1,944,274 | $ | 3,888,547 | — | — | — | — | — | — | |||||||||||||||||||||||||
Richard M. Bracken | 1/30/2007 | — | — | — | — | 233,102 | — | 116,552 | $ | 51.00 | $ | 5,560,666 | ||||||||||||||||||||||||||
Richard M. Bracken | N/A | $ | 477,392 | $ | 954,785 | $ | 1,909,570 | — | — | — | — | — | — | |||||||||||||||||||||||||
R. Milton Johnson | 1/30/2007 | — | — | — | — | 166,502 | — | 83,251 | $ | 51.00 | $ | 3,971,905 | ||||||||||||||||||||||||||
R. Milton Johnson | N/A | $ | 225,114 | $ | 450,227 | $ | 900,455 | — | — | — | — | — | — | |||||||||||||||||||||||||
Samuel N. Hazen | 1/30/2007 | — | — | — | — | 106,560 | — | 53,281 | $ | 51.00 | $ | 2,542,007 | ||||||||||||||||||||||||||
Samuel N. Hazen | N/A | $ | 236,602 | $ | 473,203 | $ | 946,406 | — | — | — | — | — | — | |||||||||||||||||||||||||
Beverly B. Wallace | 1/30/2007 | — | — | — | — | 93,240 | — | 46,621 | $ | 51.00 | $ | 2,224,258 | ||||||||||||||||||||||||||
Beverly B. Wallace | N/A | $ | 210,000 | $ | 420,000 | $ | 840,000 | — | — | — | — | — | — |
(1) | Non-equity incentive awards granted each of | |
(2) | Stock options awarded under the | |
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84
Number of | Number of | Number of | Market Value | |||||||||||||||||||||
Securities | Securities | Shares of | of Shares | |||||||||||||||||||||
Underlying | Underlying | Option | Units | or Units | ||||||||||||||||||||
Unexercised | Unexercised | Exercise | Option | of Stock that | of Stock That | |||||||||||||||||||
Options | Options | Price | Expiration | Have not | Have Not | |||||||||||||||||||
Name | Exercisable(1) | Unexercisable(1) | ($)(2) | Date | Vested(3) | Vested(3) | ||||||||||||||||||
Jack O. Bovender, Jr. | 143,058 | — | $ | 12.75 | 1/25/2011 | — | — | |||||||||||||||||
Jack O. Bovender, Jr. | 53,882 | — | $ | 12.75 | 1/24/2012 | — | — | |||||||||||||||||
Jack O. Bovender, Jr. | 69,411 | — | $ | 12.75 | 1/29/2013 | — | — | |||||||||||||||||
Jack O. Bovender, Jr. | 53,751 | — | $ | 12.75 | 1/29/2014 | — | — | |||||||||||||||||
Jack O. Bovender, Jr. | 24,549 | — | $ | 12.75 | 1/27/2015 | — | — | |||||||||||||||||
Jack O. Bovender, Jr. | 15,843 | — | $ | 12.75 | 1/26/2016 | — | — | |||||||||||||||||
Richard M. Bracken | 8,052 | — | $ | 12.75 | 3/22/2011 | — | — | |||||||||||||||||
Richard M. Bracken | 26,248 | — | $ | 12.75 | 7/26/2011 | — | — | |||||||||||||||||
Richard M. Bracken | 29,934 | — | $ | 12.75 | 1/24/2012 | — | — | |||||||||||||||||
Richard M. Bracken | 40,490 | — | $ | 12.75 | 1/29/2013 | — | — | |||||||||||||||||
Richard M. Bracken | 30,235 | — | $ | 12.75 | 1/29/2014 | — | — | |||||||||||||||||
Richard M. Bracken | 10,739 | — | $ | 12.75 | 1/27/2015 | — | — | |||||||||||||||||
Richard M. Bracken | 7,095 | — | $ | 12.75 | 1/26/2016 | — | — | |||||||||||||||||
R. Milton Johnson | 87,180 | — | $ | 12.75 | 3/4/2009 | — | — | |||||||||||||||||
R. Milton Johnson | 6,039 | — | $ | 12.75 | 3/22/2011 | — | — | |||||||||||||||||
R. Milton Johnson | 9,579 | — | $ | 12.75 | 1/24/2012 | — | — | |||||||||||||||||
R. Milton Johnson | 9,254 | — | $ | 12.75 | 1/29/2013 | — | — | |||||||||||||||||
R. Milton Johnson | 8,062 | — | $ | 12.75 | 1/29/2014 | — | — | |||||||||||||||||
R. Milton Johnson | 26,013 | — | $ | 12.75 | 7/22/2014 | — | — | |||||||||||||||||
R. Milton Johnson | 6,441 | — | $ | 12.75 | 1/27/2015 | — | — | |||||||||||||||||
R. Milton Johnson | 4,301 | — | $ | 12.75 | 1/26/2016 | — | — | |||||||||||||||||
Samuel N. Hazen | 28,123 | — | $ | 12.75 | 3/4/2009 | — | — | |||||||||||||||||
Samuel N. Hazen | 6,039 | — | $ | 12.75 | 3/22/2011 | — | — | |||||||||||||||||
Samuel N. Hazen | 13,124 | — | $ | 12.75 | 7/26/2011 | — | — | |||||||||||||||||
Samuel N. Hazen | 19,158 | — | $ | 12.75 | 1/24/2012 | — | — | |||||||||||||||||
Samuel N. Hazen | 23,137 | — | $ | 12.75 | 1/29/2013 | — | — | |||||||||||||||||
Samuel N. Hazen | 16,797 | — | $ | 12.75 | 1/29/2014 | — | — | |||||||||||||||||
Samuel N. Hazen | 6,441 | — | $ | 12.75 | 1/27/2015 | — | — | |||||||||||||||||
Samuel N. Hazen | 4,301 | — | $ | 12.75 | 1/26/2016 | — | — | |||||||||||||||||
W. Paul Rutledge | 8,381 | — | $ | 12.75 | 1/24/2012 | — | — | |||||||||||||||||
W. Paul Rutledge | 9,254 | — | $ | 12.75 | 1/29/2013 | — | — | |||||||||||||||||
W. Paul Rutledge | 5,375 | — | $ | 12.75 | 1/29/2014 | — | — | |||||||||||||||||
W. Paul Rutledge | 2,297 | — | $ | 12.75 | 1/27/2015 | — | — | |||||||||||||||||
W. Paul Rutledge | 5,395 | — | $ | 12.75 | 10/01/2015 | — | — | |||||||||||||||||
W. Paul Rutledge | 4,301 | — | $ | 12.75 | 1/26/2016 | — | — | |||||||||||||||||
Charles R. Evans | — | — | — | — | — | — |
Equity Incentive | ||||||||||||||||||||
Number of | Number of | Plan Awards: Number | ||||||||||||||||||
Securities | Securities | of Securities | ||||||||||||||||||
Underlying | Underlying | Underlying | Option | |||||||||||||||||
Unexercised | Unexercised | Unexercised | Exercise | Option | ||||||||||||||||
Options | Options | Unearned | Price | Expiration | ||||||||||||||||
Name | Exercisable(#)(1)(2) | Unexercisable(#)(2) | Options(#)(2) | ($)(3)(4) | Date | |||||||||||||||
Jack O. Bovender, Jr | 143,058 | — | — | $ | 12.75 | 1/25/2011 | ||||||||||||||
Jack O. Bovender, Jr | 53,882 | — | — | $ | 12.75 | 1/24/2012 | ||||||||||||||
Jack O. Bovender, Jr | 69,411 | — | — | $ | 12.75 | 1/29/2013 | ||||||||||||||
Jack O. Bovender, Jr | 53,751 | — | — | $ | 12.75 | 1/29/2014 | ||||||||||||||
Jack O. Bovender, Jr | 24,549 | — | — | $ | 12.75 | 1/27/2015 | ||||||||||||||
Jack O. Bovender, Jr | 15,843 | — | — | $ | 12.75 | 1/26/2016 | ||||||||||||||
Jack O. Bovender, Jr | 26,640 | 133,202 | 239,762 | $ | 51.00 | 1/30/2017 | ||||||||||||||
Richard M. Bracken | 8,052 | — | — | $ | 12.75 | 3/22/2011 | ||||||||||||||
Richard M. Bracken | 26,248 | — | — | $ | 12.75 | 7/26/2011 | ||||||||||||||
Richard M. Bracken | 29,934 | — | — | $ | 12.75 | 1/24/2012 | ||||||||||||||
Richard M. Bracken | 40,490 | — | — | $ | 12.75 | 1/29/2013 | ||||||||||||||
Richard M. Bracken | 30,235 | — | — | $ | 12.75 | 1/29/2014 | ||||||||||||||
Richard M. Bracken | 10,739 | — | — | $ | 12.75 | 1/27/2015 | ||||||||||||||
Richard M. Bracken | 7,095 | — | — | $ | 12.75 | 1/26/2016 | ||||||||||||||
Richard M. Bracken | 23,310 | 116,552 | 209,792 | $ | 51.00 | 1/30/2017 | ||||||||||||||
R. Milton Johnson | 87,180 | — | — | $ | 12.75 | 3/4/2009 | ||||||||||||||
R. Milton Johnson | 6,039 | — | — | $ | 12.75 | 3/22/2011 | ||||||||||||||
R. Milton Johnson | 9,579 | — | — | $ | 12.75 | 1/24/2012 | ||||||||||||||
R. Milton Johnson | 9,254 | — | — | $ | 12.75 | 1/29/2013 | ||||||||||||||
R. Milton Johnson | 8,062 | — | — | $ | 12.75 | 1/29/2014 | ||||||||||||||
R. Milton Johnson | 26,013 | — | — | $ | 12.75 | 7/22/2014 | ||||||||||||||
R. Milton Johnson | 6,441 | — | — | $ | 12.75 | 1/27/2015 | ||||||||||||||
R. Milton Johnson | 4,301 | — | — | $ | 12.75 | 1/26/2016 |
79
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Equity Incentive | ||||||||||||||||||||
Number of | Number of | Plan Awards: Number | ||||||||||||||||||
Securities | Securities | of Securities | ||||||||||||||||||
Underlying | Underlying | Underlying | Option | |||||||||||||||||
Unexercised | Unexercised | Unexercised | Exercise | Option | ||||||||||||||||
Options | Options | Unearned | Price | Expiration | ||||||||||||||||
Name | Exercisable(#)(1)(2) | Unexercisable(#)(2) | Options(#)(2) | ($)(3)(4) | Date | |||||||||||||||
R. Milton Johnson | 16,650 | 83,251 | 149,852 | $ | 51.00 | 1/30/2017 | ||||||||||||||
Samuel N. Hazen | 28,123 | — | — | $ | 12.75 | 3/4/2009 | ||||||||||||||
Samuel N. Hazen | 6,039 | — | — | $ | 12.75 | 3/22/2011 | ||||||||||||||
Samuel N. Hazen | 13,124 | — | — | $ | 12.75 | 7/26/2011 | ||||||||||||||
Samuel N. Hazen | 19,158 | — | — | $ | 12.75 | 1/24/2012 | ||||||||||||||
Samuel N. Hazen | 23,137 | — | — | $ | 12.75 | 1/29/2013 | ||||||||||||||
Samuel N. Hazen | 16,797 | — | — | $ | 12.75 | 1/29/2014 | ||||||||||||||
Samuel N. Hazen | 6,441 | — | — | $ | 12.75 | 1/27/2015 | ||||||||||||||
Samuel N. Hazen | 4,301 | — | — | $ | 12.75 | 1/26/2016 | ||||||||||||||
Samuel N. Hazen | 10,656 | 53,281 | 95,904 | $ | 51.00 | 1/30/2017 | ||||||||||||||
Beverly B. Wallace | 6,039 | — | — | $ | 12.75 | 3/22/2011 | ||||||||||||||
Beverly B. Wallace | 9,579 | — | — | $ | 12.75 | 1/24/2012 | ||||||||||||||
Beverly B. Wallace | 13,882 | — | — | $ | 12.75 | 1/29/2013 | ||||||||||||||
Beverly B. Wallace | 11,422 | — | — | $ | 12.75 | 1/29/2014 | ||||||||||||||
Beverly B. Wallace | 4,601 | — | — | $ | 12.75 | 1/27/2015 | ||||||||||||||
Beverly B. Wallace | 3,559 | — | — | $ | 12.75 | 1/26/2016 | ||||||||||||||
Beverly B. Wallace | 9,324 | 46,621 | 83,916 | $ | 51.00 | 1/30/2017 |
(1) | Reflects Rollover Options, as further described under “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table — Options,” and | |
(2) | Reflects New Options awarded in January 2007 under the 2006 Plan by the Compensation Committee as part of the named executive officer’s long term equity incentive award. The New Options granted in 2007 are structured so that 1/3 are time vested options (vesting in five equal installments on the first five anniversaries of the January 30, 2007 grant date), 1/3 are EBITDA-based performance vested options (vesting in equal increments of 20% at the end of fiscal years 2007, 2008, 2009, 2010 and 2011 if certain annual EBITDA performance targets are achieved, subject to “catch up” vesting if at the end of any year noted above or at the end of fiscal year 2012, the cumulative total EBITDA earned in all prior years exceeds the cumulative EBITDA target at the end of such fiscal year) and 1/3 are performance options that vest based on investment return to the Sponsors (vesting with respect to 10% of the common stock subject to such options at the end of fiscal years 2007,2008, 2009, 2010 and 2011 if the Investor Return is at least $102.00 and with respect to an additional 10% at the end of fiscal years 2007, 2008, 2009, 2010 and 2011 if the Investor Return is at least $127.50, subject to “catch up” vesting if the relevant Investor Return is achieved at any time occurring prior to January 30, 2017, so long as the named executive officer remains employed by the Company). The time vested options are reflected in the “Number of Securities Underlying Unexercised Options Unexercisable” column, and the EBITDA-based performance vested options and investment return performance vested options are both reflected in the “Equity Incentive Plan Awards: Number of Securities Underlying Unexercised Unearned Options” column (with the exception of the 20% of the EBITDA-based performance vested options that vested as of December 31, 2007, which are reflected in the “Number of Securities Underlying Unexercised Options Exercisable” column). The terms of these option awards are described in more detail under “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table — Options.” |
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(3) | Immediately after the consummation of the Merger, all Rollover Options (other than those with an exercise price below $12.75) were adjusted such that they retained the same “spread value” (as defined below) as immediately prior to the Merger, but the new per share exercise price for all Rollover Options would be $12.75. The term “spread value” means the difference between (x) the aggregate fair market value of the common stock (determined using the Merger consideration of $51.00 per share) subject to the outstanding options held by the participant immediately prior to the Merger that became Rollover Options, and (y) the aggregate exercise price of those options. | |
The exercise price for the |
Option Awards | Stock Awards | |||||||||||||||
Number of Shares | Number of Shares | |||||||||||||||
Acquired on | Value Realized on | Acquired on | Value Realized on | |||||||||||||
Name | Exercise(1) | Exercise ($)(1) | Vesting(2) | Vesting ($)(2) | ||||||||||||
Jack O. Bovender, Jr. | 420,660 | $ | 14,253,643 | 178,168 | $ | 9,024,985 | ||||||||||
Richard M. Bracken | 137,912 | $ | 4,673,010 | 92,829 | $ | 4,701,665 | ||||||||||
R. Milton Johnson | 9,850 | $ | 333,757 | 56,428 | $ | 2,861,852 | ||||||||||
Samuel N. Hazen | 73,419 | $ | 2,487,729 | 62,100 | $ | 3,140,286 | ||||||||||
W. Paul Rutledge | — | — | 57,879 | $ | 2,928,404 | |||||||||||
Charles R. Evans | 315,575 | $ | 2,125,188 | 52,818 | $ | 2,670,339 |
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Number of Years | Present Value of | Payments During | ||||||||||||||
Name | Plan Name | Credited Service | Accumulated Benefit | Last Fiscal Year | ||||||||||||
Jack O. Bovender, Jr. | SERP | 27 | $ | 21,078,516 | $ | 0 | ||||||||||
Richard M. Bracken | SERP | 25 | $ | 7,876,338 | $ | 0 | ||||||||||
R. Milton Johnson | SERP | 23 | $ | 1,940,003 | $ | 0 | ||||||||||
Samuel N. Hazen | SERP | 24 | $ | 2,536,329 | $ | 0 | ||||||||||
W. Paul Rutledge | SERP | 25 | $ | 2,305,297 | $ | 0 | ||||||||||
Charles R. Evans | SERP | 20 | (1) | $ | 4,678,005 | $ | 0 |
Number of Years | Present Value of | Payments During | ||||||||||||||
Name | Plan Name | Credited Service | Accumulated Benefit | Last Fiscal Year | ||||||||||||
Jack O. Bovender, Jr | SERP | 28 | $ | 18,246,560 | $ | 0 | ||||||||||
Richard M. Bracken | SERP | 26 | $ | 8,466,708 | $ | 0 | ||||||||||
R. Milton Johnson | SERP | 25 | $ | 2,449,445 | $ | 0 | ||||||||||
Samuel N. Hazen | SERP | 25 | $ | 2,795,116 | $ | 0 | ||||||||||
Beverly B. Wallace | SERP | 24 | $ | 4,568,671 | $ | 0 |
81
87
Supplemental Information |
88
Executive | Registrant | Aggregate | Aggregate | |||||||||||||||||
Contributions | Contributions | Earnings | Aggregate | Balance | ||||||||||||||||
in Last | in Last | in Last | Withdrawals/ | at Last | ||||||||||||||||
Name | Fiscal Year | Fiscal Year | Fiscal Year | Distributions | Fiscal Year | |||||||||||||||
Jack O. Bovender, Jr. | $ | 0 | $ | 856,424 | $ | 178,899 | $ | 0 | $ | 2,696,069 | ||||||||||
Richard M. Bracken | $ | 0 | $ | 409,933 | $ | 96,222 | $ | 0 | $ | 1,403,673 | ||||||||||
R. Milton Johnson | $ | 0 | $ | 212,109 | $ | 32,249 | $ | 0 | $ | 549,363 | ||||||||||
Samuel N. Hazen | $ | 0 | $ | 247,060 | $ | 49,129 | $ | 0 | $ | 757,286 | ||||||||||
W. Paul Rutledge | $ | 0 | $ | 172,696 | $ | 21,858 | $ | 0 | $ | 404,137 | ||||||||||
Charles R. Evans | $ | 0 | $ | 181,516 | $ | 26,378 | $ | 0 | $ | 464,014 |
82
Executive | Registrant | Aggregate | Aggregate | |||||||||||||||||
Contributions | Contributions | Earnings | Aggregate | Balance | ||||||||||||||||
in Last | in Last | in Last | Withdrawals/ | at Last | ||||||||||||||||
Name | Fiscal Year | Fiscal Year | Fiscal Year | Distributions | Fiscal Year | |||||||||||||||
Jack O. Bovender, Jr | $ | 0 | $ | 153,475 | $ | 193,899 | $ | 0 | $ | 3,043,444 | ||||||||||
Richard M. Bracken | $ | 0 | $ | 91,946 | $ | 101,171 | $ | 0 | $ | 1,596,790 | ||||||||||
R. Milton Johnson | $ | 0 | $ | 57,792 | $ | 46,985 | $ | 0 | $ | 654,139 | ||||||||||
Samuel N. Hazen | $ | 0 | $ | 62,004 | $ | 54,424 | $ | 0 | $ | 873,713 | ||||||||||
Beverly B. Wallace | $ | 0 | $ | 52,250 | $ | 32,384 | $ | 0 | $ | 538,766 |
Restoration Contribution | ||||||||||||||||||||
Name | 2001 | 2002 | 2003 | 2004 | 2005 | |||||||||||||||
Jack O. Bovender, Jr. | $ | 187,193 | $ | 268,523 | $ | 289,899 | $ | 363,481 | $ | 295,062 | ||||||||||
Richard M. Bracken | $ | 87,924 | $ | 146,549 | $ | 162,344 | $ | 192,858 | $ | 172,571 | ||||||||||
R. Milton Johnson | — | — | — | — | $ | 71,441 | ||||||||||||||
Samuel N. Hazen | — | — | $ | 79,510 | $ | 101,488 | $ | 97,331 |
Restoration Contribution | ||||||||||||||||||||||||
Name | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | ||||||||||||||||||
Jack O. Bovender, Jr | $ | 187,193 | $ | 268,523 | $ | 289,899 | $ | 363,481 | $ | 295,062 | $ | 856,424 | ||||||||||||
Richard M. Bracken | $ | 87,924 | $ | 146,549 | $ | 162,344 | $ | 192,858 | $ | 172,571 | $ | 409,933 | ||||||||||||
R. Milton Johnson | — | — | — | — | $ | 71,441 | $ | 212,109 | ||||||||||||||||
Samuel N. Hazen | — | — | $ | 79,510 | $ | 101,488 | $ | 97,331 | $ | 247,060 |
Contribution | |||||
Service | Credit | ||||
0 to 4 years | 4.5 | % | |||
5 to 9 years | 6.0 | % | |||
10 to 14 years | 8.0 | % | |||
15 to 19 years | 10.0 | % | |||
20 or more years | 11.0 | % |
89
83
Involuntary | Voluntary | |||||||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | Change in | ||||||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | Control | ||||||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 10,693,505 | — | $ | 10,693,505 | — | — | — | |||||||||||||||||||||||||
Non-Equity Incentive Bonus(2) | $ | 3,888,547 | $ | 3,888,547 | $ | 3,888,547 | $ | 3,888,547 | — | $ | 3,888,547 | $ | 3,888,547 | $ | 3,888,547 | $ | 3,888,547 | |||||||||||||||||||
Unvested Stock Options(3) | $ | 2,656,008 | $ | 2,656,008 | $ | 2,656,008 | $ | 2,656,008 | — | $ | 2,656,008 | $ | 2,656,008 | $ | 2,656,008 | $ | 3,718,451 | |||||||||||||||||||
SERP(4) | $ | 18,187,579 | $ | 18,187,579 | $ | 18,187,579 | $ | 18,187,579 | $ | 18,187,579 | $ | 18,187,579 | $ | 18,187,579 | $ | 15,161,849 | — | |||||||||||||||||||
Retirement Plans(5) | $ | 3,312,944 | $ | 3,312,944 | $ | 3,312,944 | $ | 3,312,944 | $ | 3,312,944 | $ | 3,312,944 | $ | 3,312,944 | $ | 3,312,944 | — | |||||||||||||||||||
Health and Welfare Benefits(6) | — | — | — | $ | 20,126 | — | — | — | — | — | ||||||||||||||||||||||||||
Disability Income(7) | — | — | — | — | — | — | $ | 1,193,168 | — | — | ||||||||||||||||||||||||||
Life Insurance Benefits(8) | — | — | — | — | — | — | — | $ | 2,021,000 | — | ||||||||||||||||||||||||||
Accrued Vacation Pay | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | — | |||||||||||||||||||
Total | $ | 28,269,417 | $ | 28,269,417 | $ | 28,269,417 | $ | 38,983,048 | $ | 21,724,862 | $ | 38,962,922 | $ | 29,462,585 | $ | 27,264,687 | $ | 7,606,998 |
Involuntary | Voluntary | |||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | |||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | |||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 16,131,834 | — | $ | 16,131,834 | — | — | ||||||||||||||||||||||
Unvested Stock Options(2) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
SERP(3) | $ | 18,392,005 | $ | 18,392,005 | $ | 18,392,005 | $ | 18,392,005 | $ | 18,392,005 | $ | 18,392,005 | $ | 18,392,005 | $ | 15,715,068 | ||||||||||||||||
Retirement Plans(4) | $ | 2,927,127 | $ | 2,927,127 | $ | 2,927,127 | $ | 2,927,127 | $ | 2,927,127 | $ | 2,927,127 | $ | 2,927,127 | $ | 2,927,127 | ||||||||||||||||
Health and Welfare Benefits(5) | — | — | — | $ | 40,162 | — | — | — | — | |||||||||||||||||||||||
Disability Income(6) | — | — | — | — | — | — | $ | 1,346,299 | — | |||||||||||||||||||||||
Life Insurance Benefits(7) | — | — | — | — | — | — | — | $ | 2,021,000 | |||||||||||||||||||||||
Accrued Vacation Pay | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 | $ | 224,339 |
(1) | Represents the amounts Mr. Bovender would be entitled to receive pursuant to his employment agreement. See “Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table — Employment Agreements.” | |
(2) | Represents the amount Mr. Bovender would be entitled to receive for the 2007 fiscal year pursuant to the 2007 PEP and his employment agreement, which amount is also included in the “Non-Equity Incentive Plan Compensation” column of the | |
(3) | The amount set forth in the “Voluntary Termination,” “Early Retirement,” “Normal Retirement,” “Involuntary Termination Without Cause,” “Voluntary Termination for Good Reason,” “Disability” and “Death” columns represents the intrinsic value of all unvested stock options, which, pursuant to Mr. Bovender’s employment agreement, will continue to vest after the termination of his employment (other than a termination for cause), calculated as the difference between the exercise price of Mr. Bovender’s unvested New Options subject to such continued vesting provision and the fair value price of our common stock on December 31, 2007 as determined by our Board of Directors in consultation with our Chief Executive Officer and other advisors for internal purposes ($60.97 per share). For the purposes of this calculation, it is assumed that the 2008, 2009 and 2010 EBITDA performance targets under the option awards are achieved by the Company and that the Company achieves an Investor Return of at least 2.5 times the Base Price of $51.00 at the end of each of the 2008, 2009 and 2010 fiscal years, respectively. See “Compensation Discussion and Analysis — Severance and Change in Control Agreements.” | |
The amount set forth in the “Change in Control” column represents the intrinsic value of all unvested stock options, which will become vested upon the Change in Control, calculated as the difference between the exercise price of Mr. Bovender’s unvested New Options and the fair value price of our common stock on December 31, 2007 as determined by our Board of Directors in consultation with our Chief Executive Officer and other advisors for internal purposes ($60.97 per share). For the purposes of this calculation, it is assumed that the Company achieved an Investor Return of at least 2.5 times the Base Price of $51.00 at the end of the 2007 fiscal year. | ||
(4) | Reflects the present value of the stream of payments from the |
84
(5) | ||
Reflects the estimated lump sum present value of qualified and nonqualified retirement plans to which Mr. Bovender would be entitled. The value includes | ||
Reflects the present value of the medical premiums for Mr. Bovender and his spouse from termination to age 65 as required pursuant to Mr. Bovender’s employment agreement. See “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table — Employment Agreements.” | ||
Reflects the estimated lump sum present value of all future payments which Mr. Bovender would be entitled to receive under our disability program, including five months of salary continuation, monthly long term disability benefits of $10,000 per month payable after the five-month elimination period until age 65, and monthly benefits of $10,000 per month from our | ||
No post-retirement or post-termination life insurance or death benefits are provided to Mr. Bovender. Mr. Bovender’s payment upon death while actively employed includes $1,621,000 of Company-paid life insurance and $400,000 from the Executive Death Benefit Plan. |
90
Involuntary | Voluntary | |||||||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | Change in | ||||||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | Control | ||||||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 6,046,970 | — | $ | 6,046,970 | — | — | — | |||||||||||||||||||||||||
Non-Equity Incentive Bonus(2) | $ | 1,909,570 | $ | 1,909,570 | $ | 1,909,570 | $ | 1,909,570 | — | $ | 1,909,570 | $ | 1,909,570 | $ | 1,909,570 | $ | 1,909,570 | |||||||||||||||||||
Unvested Stock Options(3) | — | — | — | — | — | — | — | — | $ | 3,253,650 | ||||||||||||||||||||||||||
SERP(4) | $ | 11,301,668 | $ | 11,301,668 | — | $ | 11,301,668 | $ | 11,301,668 | $ | 11,301,668 | $ | 11,301,668 | $ | 10,091,220 | — | ||||||||||||||||||||
Retirement Plans(5) | $ | 2,851,439 | $ | 2,851,439 | $ | 2,851,439 | $ | 2,851,439 | $ | 2,851,439 | $ | 2,851,439 | $ | 2,851,439 | $ | 2,851,439 | — | |||||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Disability Income(6) | — | — | — | — | — | — | $ | 1,840,091 | — | — | ||||||||||||||||||||||||||
Life Insurance Benefits(7) | — | — | — | — | — | — | — | $ | 1,136,000 | — | ||||||||||||||||||||||||||
Accrued Vacation Pay | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | — | |||||||||||||||||||
Total | $ | 16,209,567 | $ | 16,209,567 | $ | 4,907,899 | $ | 22,256,537 | $ | 14,299,997 | $ | 22,256,537 | $ | 18,049,658 | $ | 16,135,119 | $ | 5,163,220 |
Involuntary | Voluntary | |||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | |||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | |||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 7,795,101 | — | $ | 7,795,101 | — | — | ||||||||||||||||||||||
Unvested Stock Options(2) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
SERP(3) | $ | 9,083,224 | — | — | $ | 9,083,224 | $ | 9,083,224 | $ | 9,083,224 | $ | 9,083,224 | $ | 8,230,949 | ||||||||||||||||||
Retirement Plans(4) | $ | 2,555,631 | $ | 2,555,631 | $ | 2,555,631 | $ | 2,555,631 | $ | 2,555,631 | $ | 2,555,631 | $ | 2,555,631 | $ | 2,555,631 | ||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Disability Income(5) | — | — | — | — | — | — | $ | 1,937,132 | — | |||||||||||||||||||||||
Life Insurance Benefits(6) | — | — | — | — | — | — | — | $ | 1,136,000 | |||||||||||||||||||||||
Accrued Vacation Pay | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 | $ | 146,890 |
(1) | Represents amounts Mr. Bracken would be entitled to receive pursuant to his employment agreement. See “Narrative Disclosure to Summary Compensation Table and Grants of Plan-Based Awards Table — Employment Agreements.” | |
(2) | Represents the amount Mr. Bracken would be entitled to receive for the 2007 fiscal year pursuant to the 2007 PEP and his employment agreement, which amount is also included in the “Non-Equity Incentive Plan Compensation” column of the | |
(3) | Represents the | |
(4) | Reflects the actual lump sum value of the SERP based on the 2007 interest rate of 4.90%. | |
(5) | Reflects the estimated lump sum present value of qualified and nonqualified retirement plans to which Mr. Bracken would be entitled. The value includes | |
Reflects the estimated lump sum present value of all future payments which Mr. Bracken would be entitled to receive under our disability program, including five months of salary continuation, monthly long term disability benefits of $10,000 per month payable after the five-month elimination period until age 65, and monthly |
85
benefits of $10,000 per month from our | ||
No post-retirement or post-termination life insurance or death benefits are provided to Mr. Bracken. Mr. Bracken’s payment upon death while actively employed includes $1,061,000 of Company-paid life insurance and $75,000 from the Executive Death Benefit Plan. |
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R. |
Involuntary | Voluntary | |||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | |||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | |||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 4,426,149 | — | $ | 4,426,149 | — | — | ||||||||||||||||||||||
Unvested Stock Options(2) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
SERP(3) | $ | 2,254,672 | — | — | $ | 2,627,200 | $ | 2,254,672 | $ | 2,627,200 | $ | 2,254,672 | $ | 1,958,523 | ||||||||||||||||||
Retirement Plans(4) | $ | 1,554,747 | $ | 1,554,747 | $ | 1,554,747 | $ | 1,554,747 | $ | 1,554,747 | $ | 1,554,747 | $ | 1,554,747 | $ | 1,554,747 | ||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Disability Income(5) | — | — | — | — | — | — | $ | 2,162,557 | — | |||||||||||||||||||||||
Life Insurance Benefits(6) | — | — | — | — | — | — | — | $ | 751,000 | |||||||||||||||||||||||
Accrued Vacation Pay | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 |
Involuntary | Voluntary | |||||||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | Change in | ||||||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | Control | ||||||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 3,601,819 | — | $ | 3,601,819 | — | — | — | |||||||||||||||||||||||||
Non-Equity Incentive Bonus(2) | $ | 900,455 | $ | 900,455 | $ | 900,455 | $ | 900,455 | — | $ | 900,455 | $ | 900,455 | $ | 900,455 | $ | 900,455 | |||||||||||||||||||
Unvested Stock Options(3) | — | — | — | — | — | — | — | — | $ | 2,324,037 | ||||||||||||||||||||||||||
SERP(4) | $ | 3,784,405 | — | — | $ | 3,784,405 | $ | 3,784,405 | $ | 3,784,405 | $ | 3,784,405 | $ | 3,614,021 | — | |||||||||||||||||||||
Retirement Plans(5) | $ | 1,751,272 | $ | 1,751,272 | $ | 1,751,272 | $ | 1,751,272 | $ | 1,751,272 | $ | 1,751,272 | $ | 1,751,272 | $ | 1,751,272 | — | |||||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Disability Income(6) | — | — | — | — | — | — | $ | 2,087,441 | — | — | ||||||||||||||||||||||||||
Life Insurance Benefits(7) | — | — | — | — | — | — | — | $ | 751,000 | — | ||||||||||||||||||||||||||
Accrued Vacation Pay | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | $ | 103,899 | — | |||||||||||||||||||
Total | $ | 6,540,031 | $ | 2,755,626 | $ | 2,755,626 | $ | 10,141,850 | $ | 5,639,576 | $ | 10,141,850 | $ | 8,627,472 | $ | 7,120,647 | $ | 3,224,492 |
(1) | Represents amounts Mr. Johnson would be entitled to receive pursuant to his employment agreement. See “Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table — Employment Agreements.” | |
(2) | Represents the amount Mr. Johnson would be entitled to receive for the 2007 fiscal year pursuant to the 2007 PEP and his employment agreement, which amount is also included in the “Non-Equity Incentive Plan Compensation” column of the | |
(3) | Represents the | |
(4) | Reflects the actual lump sum value of the SERP based on the 2007 interest rate of 4.90%. | |
(5) | Reflects the estimated lump sum present value of qualified and nonqualified retirement plans to which Mr. Johnson would be entitled. The value includes | |
Reflects the estimated lump sum present value of all future payments which Mr. Johnson would be entitled to receive under our disability program, including five months of salary continuation, monthly long term disability benefits of $10,000 per month payable after the five-month elimination period until age 65, and monthly benefits of $10,000 per month from our | ||
No post-retirement or post-termination life insurance or death benefits are provided to Mr. Johnson. Mr. Johnson’s payment upon death while actively employed includes $751,000 of Company-paid life insurance. |
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92
Involuntary | Voluntary | |||||||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | Change in | ||||||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | Control | ||||||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 2,523,750 | — | $ | 2,523,750 | — | — | — | |||||||||||||||||||||||||
Non-Equity Incentive Bonus(2) | $ | 830,779 | $ | 830,779 | $ | 830,779 | $ | 830,779 | — | $ | 830,779 | $ | 830,779 | $ | 830,779 | $ | 830,779 | |||||||||||||||||||
Unvested Stock Options(3) | — | — | — | — | — | — | — | — | $ | 1,487,374 | ||||||||||||||||||||||||||
SERP(4) | $ | 4,180,799 | — | — | $ | 4,180,799 | $ | 4,180,799 | $ | 4,180,799 | $ | 4,180,799 | $ | 4,150,932 | — | |||||||||||||||||||||
Retirement Plans(5) | $ | 1,447,316 | $ | 1,447,316 | $ | 1,447,316 | $ | 1,447,316 | $ | 1,447,316 | $ | 1,447,316 | $ | 1,447,316 | $ | 1,447,316 | — | |||||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Disability Income(6) | — | — | — | — | — | — | $ | 2,354,661 | — | — | ||||||||||||||||||||||||||
Life Insurance Benefits(7) | — | — | — | — | — | — | — | $ | 789,000 | — | ||||||||||||||||||||||||||
Accrued Vacation Pay | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | — | |||||||||||||||||||
Total | $ | 6,568,095 | $ | 2,387,296 | $ | 2,387,296 | $ | 9,091,845 | $ | 5,737,316 | $ | 9,091,845 | $ | 8,922,756 | $ | 7,327,228 | $ | 2,318,153 |
Involuntary | Voluntary | |||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | |||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | |||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 3,406,149 | — | $ | 3,406,149 | — | — | ||||||||||||||||||||||
Unvested Stock Options(2) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
SERP(3) | $ | 2,935,987 | — | — | $ | 3,132,967 | $ | 2,935,987 | $ | 3,132,967 | $ | 2,935,987 | $ | 2,427,649 | ||||||||||||||||||
Retirement Plans(4) | $ | 1,272,753 | $ | 1,272,753 | $ | 1,272,753 | $ | 1,272,753 | $ | 1,272,753 | $ | 1,272,753 | $ | 1,272,753 | $ | 1,272,753 | ||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Disability Income(5) | — | — | — | — | — | — | $ | 2,418,906 | — | |||||||||||||||||||||||
Life Insurance Benefits(6) | — | — | — | — | — | — | — | $ | 789,000 | |||||||||||||||||||||||
Accrued Vacation Pay | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 | $ | 109,201 |
(1) | Represents amounts Mr. Hazen would be entitled to receive pursuant to his employment agreement. See “Narrative to Summary Compensation Table and Grants of Plan-Based Awards Table — Employment Agreements.” | |
(2) | Represents the amount Mr. Hazen would be entitled to receive for the 2007 fiscal year pursuant to the 2007 PEP and his employment agreement, which amount is also included in the “Non-Equity Incentive Plan Compensation” column of the | |
(3) | Represents the | |
(4) | Reflects the actual lump sum value of the SERP based on the 2007 interest rate of 4.90%. | |
(5) | Reflects the estimated lump sum present value of qualified and nonqualified retirement plans to which Mr. Hazen would be entitled. The value includes | |
Reflects the estimated lump sum present value of all future payments which Mr. Hazen would be entitled to receive under our disability program, including five months of salary continuation, monthly long term disability benefits of $10,000 per month payable after the five-month elimination period until age 65, and monthly benefits of $10,000 per month from our | ||
No post-retirement or post-termination life insurance or death benefits are provided to Mr. Hazen. Mr. Hazen’s payment upon death while actively employed with the Company includes $789,000 of the Company-paid life insurance. |
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Involuntary | Voluntary | |||||||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | Change in | ||||||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | Control | ||||||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 2,240,000 | — | $ | 2,240,000 | — | — | — | |||||||||||||||||||||||||
Non-Equity Incentive Bonus(2) | $ | 840,000 | $ | 840,000 | $ | 840,000 | $ | 840,000 | — | $ | 840,000 | $ | 840,000 | $ | 840,000 | $ | 840,000 | |||||||||||||||||||
Unvested Stock Options(3) | — | — | — | — | — | — | — | — | $ | 1,301,454 | ||||||||||||||||||||||||||
SERP(4) | $ | 5,408,794 | $ | 5,408,794 | — | $ | 5,675,914 | $ | 5,408,794 | $ | 5,675,914 | $ | 5,408,794 | $ | 4,895,534 | — | ||||||||||||||||||||
Retirement Plans(5) | $ | 1,001,983 | $ | 1,001,983 | $ | 1,001,983 | $ | 1,001,983 | $ | 1,001,983 | $ | 1,001,983 | $ | 1,001,983 | $ | 1,001,983 | — | |||||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | — | |||||||||||||||||||||||||||
Disability Income(6) | — | — | — | — | — | — | $ | 1,515,467 | — | — | ||||||||||||||||||||||||||
Life Insurance Benefits(7) | — | — | — | — | — | — | — | $ | 700,000 | — | ||||||||||||||||||||||||||
Accrued Vacation Pay | $ | 96,923 | $ | 96,923 | $ | 96,923 | $ | 96,923 | $ | 96,923 | $ | 96,923 | $ | 96,923 | $ | 96,923 | — | |||||||||||||||||||
Total | $ | 7,347,700 | $ | 7,347,700 | $ | 1,938,906 | $ | 9,854,820 | $ | 6,507,700 | $ | 9,854,820 | $ | 8,863,167 | $ | 7,534,440 | $ | 2,141,454 |
Involuntary | Voluntary | |||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | |||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | |||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 1,745,299 | — | $ | 1,745,299 | — | — | ||||||||||||||||||||||
Unvested Stock Options(2) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
SERP(3) | $ | 2,667,902 | — | — | $ | 2,667,902 | $ | 2,667,902 | $ | 2,667,902 | $ | 2,667,902 | $ | 2,388,808 | ||||||||||||||||||
Retirement Plans(4) | $ | 1,261,470 | $ | 1,261,470 | $ | 1,261,470 | $ | 1,261,470 | $ | 1,261,470 | $ | 1,261,470 | $ | 1,261,470 | $ | 1,261,470 | ||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Disability Income(5) | — | — | — | — | — | — | $ | 1,973,470 | — | |||||||||||||||||||||||
Life Insurance Benefits(6) | — | — | — | — | — | — | — | $ | 725,000 | |||||||||||||||||||||||
Accrued Vacation Pay | $ | 90,000 | $ | 90,000 | $ | 90,000 | $ | 90,000 | $ | 90,000 | $ | 90,000 | $ | 90,000 | $ | 90,000 |
(1) | Represents amounts | |
(2) | Represents the amount Ms. Wallace would be entitled to receive for the 2007 fiscal year pursuant to the 2007 PEP and her employment agreement, which amount is also included in the “Non-Equity Incentive Plan Compensation” column of the | |
(3) | Represents the | |
(4) | Reflects the actual lump sum value of the SERP based on the 2007 interest rate of 4.90%. | |
(5) | Reflects the estimated lump sum present value of qualified and nonqualified retirement plans to which | |
Reflects the estimated lump sum present value of all future payments which | ||
No post-retirement or post-termination life insurance or death benefits are provided to |
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Involuntary | Voluntary | |||||||||||||||||||||||||||||||
Termination | Termination | |||||||||||||||||||||||||||||||
Voluntary | Early | Normal | Without | Termination | for Good | |||||||||||||||||||||||||||
Termination | Retirement | Retirement | Cause | for Cause | Reason | Disability | Death | |||||||||||||||||||||||||
Cash Severance(1) | — | — | — | $ | 362,261 | — | $ | 362,261 | — | — | ||||||||||||||||||||||
Unvested Stock Options(2) | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
SERP(3) | $ | 4,229,867 | $ | 4,229,867 | — | $ | 4,985,027 | $ | 4,229,867 | $ | 4,985,027 | $ | 4,229,867 | $ | 3,743,767 | |||||||||||||||||
Retirement Plans(4) | $ | 698,925 | $ | 698,925 | $ | 698,925 | $ | 698,925 | $ | 698,925 | $ | 698,925 | $ | 698,925 | $ | 698,925 | ||||||||||||||||
Health and Welfare Benefits | — | — | — | — | — | — | — | — | ||||||||||||||||||||||||
Disability Income(5) | — | — | — | — | — | — | $ | 1,094,130 | — | |||||||||||||||||||||||
Life Insurance Benefits(6) | — | — | — | — | — | — | — | $ | 725,000 | |||||||||||||||||||||||
Accrued Vacation Pay | $ | 100,318 | $ | 100,318 | $ | 100,318 | $ | 100,318 | $ | 100,318 | $ | 100,318 | $ | 100,318 | $ | 100,318 |
95
Fees Earned | ||||||||||||||||||||
or Paid in | Stock | Option | All Other | |||||||||||||||||
Cash | Awards | Awards | Compensation | Total | ||||||||||||||||
Name | ($)(1) | ($)(2) | ($)(3) | ($)(4) | ($) | |||||||||||||||
C. Michael Armstrong | $ | 21,500 | $ | 245,144 | $ | 183,803 | $ | 16,514 | $ | 466,961 | ||||||||||
Magdalena H. Averhoff, M.D. | $ | 34,000 | $ | 126,295 | $ | 189,384 | $ | 5,104 | $ | 354,783 | ||||||||||
Jack O. Bovender, Jr. | — | — | — | — | — | |||||||||||||||
Richard M. Bracken | — | — | — | — | — | |||||||||||||||
Martin Feldstein | $ | 38,500 | $ | 159,973 | $ | 189,384 | $ | 20,537 | $ | 408,394 | ||||||||||
Thomas F. Frist, Jr., M.D. | $ | 11,500 | $ | 186,911 | $ | 157,221 | $ | 6,473 | $ | 362,105 | ||||||||||
Frederick W. Gluck | $ | 145,500 | $ | 177,974 | $ | 189,384 | $ | 39,740 | $ | 552,598 | ||||||||||
Glenda A. Hatchett | $ | 88,000 | $ | 172,580 | $ | 189,384 | $ | 29,968 | $ | 479,932 | ||||||||||
Charles O. Holliday, Jr. | $ | 107,375 | $ | 152,317 | $ | 156,738 | $ | 22,129 | $ | 438,559 | ||||||||||
T. Michael Long | $ | 89,000 | $ | 163,840 | $ | 189,384 | $ | 34,962 | $ | 477,186 | ||||||||||
John H. McArthur | $ | 87,000 | $ | 90,049 | $ | 189,384 | $ | 33,725 | $ | 400,158 | ||||||||||
Kent C. Nelson | $ | 99,500 | $ | 159,973 | $ | 189,384 | $ | 19,573 | $ | 468,430 | ||||||||||
Frank S. Royal, M.D. | $ | 28,500 | $ | 163,839 | $ | 189,384 | $ | 23,188 | $ | 404,911 | ||||||||||
Harold T. Shapiro | $ | 41,000 | $ | 182,944 | $ | 171,455 | $ | 36,393 | $ | 431,792 |
96
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Item 12. | Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters |
• | each person who is known by us to own beneficially more than 5% of the outstanding shares of our common stock; | |
• | each of our directors; | |
• | each of our executive officers named in the Summary Compensation Table; and | |
• | all of our directors and executive officers as a group. |
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98
Name of Beneficial Owner | Number of Shares | Percent | ||||||
Hercules Holding II, LLC | 90,666,870 | (1) | 97.5 | % | ||||
Christopher J. Birosak | (1) | — | ||||||
George A. Bitar | (1) | — | ||||||
Jack O. Bovender, Jr. | 482,276 | (2) | * | |||||
Richard M. Bracken | 234,276 | (3) | * | |||||
John P. Connaughton | (1) | — | ||||||
Charles R. Evans | — | — | ||||||
Thomas F. Frist, Jr., M.D. | (1) | — | ||||||
Thomas F. Frist III | (1) | — | ||||||
Christopher R. Gordon | (1) | — | ||||||
Samuel N. Hazen | 137,120 | (4) | * | |||||
R. Milton Johnson | 156,869 | (5) | * | |||||
Michael W. Michelson | (1) | — | ||||||
James C. Momtazee | (1) | — | ||||||
Stephen G. Pagliuca | (1) | — | ||||||
W. Paul Rutledge | 67,753 | (6) | * | |||||
Peter M. Stavros | (1) | — | ||||||
Nathan C. Thorne | (1) | — | ||||||
All directors and executive officers as a group (34 persons) | 1,936,942 | (7) | 2.0 |
Name of Beneficial Owner | Number of Shares | Percent | ||||
Hercules Holding II, LLC | 91,845,692(1) | 97.5 | % | |||
Christopher J. Birosak | (1) | — | ||||
George A. Bitar | (1) | — | ||||
Jack O. Bovender, Jr. | 535,556(2) | * | ||||
Richard M. Bracken | 280,896(3) | * | ||||
John P. Connaughton | (1) | — | ||||
Thomas F. Frist, Jr., M.D. | (1) | — | ||||
Thomas F. Frist III | (1) | — | ||||
Christopher R. Gordon | (1) | — | ||||
Samuel N. Hazen | 158,432(4) | * | ||||
R. Milton Johnson | 190,169(5) | * | ||||
Michael W. Michelson | (1) | — | ||||
James C. Momtazee | (1) | — | ||||
Stephen G. Pagliuca | (1) | — | ||||
Peter M. Stavros | (1) | — | ||||
Nathan C. Thorne | (1) | — | ||||
Beverly B. Wallace | 70,130(6) | * | ||||
All directors and executive officers as a group (34 persons) | 2,260,886(7) | 2.4 |
* | Less than one percent. | |
(1) | Hercules Holding holds | |
(2) | Includes | |
(3) | Includes | |
(4) | Includes | |
(5) | Includes | |
(6) | Includes | |
(7) | Includes |
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(a) | (b) | (c) | ||||||||||
Number of securities | Weighted-average | Number of securities remaining | ||||||||||
to be issued | exercise price of | available for future issuance | ||||||||||
upon exercise of | outstanding | under equity compensation | ||||||||||
outstanding options, | options, | plans (excluding securities | ||||||||||
warrants and rights | warrants and rights | reflected in column(a)) | ||||||||||
Equity compensation plans approved by security holders | 2,285 | $ | 12.50 | 10,656 | ||||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||
Total | 2,285 | $ | 12.50 | 10,656 | ||||||||
(a) | (b) | (c) | ||||||||||
Number of securities | Weighted-average | Number of securities remaining | ||||||||||
to be issued | exercise price of | available for future issuance | ||||||||||
upon exercise of | outstanding | under equity compensation | ||||||||||
outstanding options, | options, | plans (excluding securities | ||||||||||
warrants and rights | warrants and rights | reflected in column(a) ) | ||||||||||
Equity compensation plans approved by security holders | 11,171,500 | $ | 43.54 | 1,733,700 | ||||||||
Equity compensation plans not approved by security holders | — | — | — | |||||||||
Total | 11,171,500 | $ | 43.54 | 1,733,700 | ||||||||
* | For additional information concerning our equity compensation plans, see the discussion in Note 3 — Share-Based Compensation in the notes to the consolidated financial statements. |
Item 13. | Certain Relationships and Related Transactions |
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Patient | ||||||||||||||||
Safety and | ||||||||||||||||
Audit and | Quality of | |||||||||||||||
Name of Director | Compliance | Compensation | Executive | Care | ||||||||||||
Christopher J. Birosak | Chair | |||||||||||||||
George A. Bitar | X | |||||||||||||||
Jack O. Bovender, Jr.* | Chair | |||||||||||||||
Richard M. Bracken* | ||||||||||||||||
John P. Connaughton | X | |||||||||||||||
Thomas F. Frist, Jr., M.D. | X | X | ||||||||||||||
Thomas F. Frist III | X | |||||||||||||||
Christopher R. Gordon | X | |||||||||||||||
Michael W. Michelson | Chair | X | ||||||||||||||
James C. Momtazee | X | |||||||||||||||
Stephen G. Pagliuca | X | Chair | ||||||||||||||
Peter M. Stavros | X | |||||||||||||||
Nathan C. Thorne | X | X |
* | Indicates management director. |
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Item 14. | Principal Accountant Fees and Services |
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Item 15. | Exhibits and Financial Statement Schedules |
2 | .1 | — | Agreement and Plan of Merger, dated July 24, 2006, by and among HCA Inc., Hercules Holding II, LLC and Hercules Acquisition Corporation (filed as Exhibit 2.1 to the Company’s Current Report onForm 8-K filed July 25, 2006, and incorporated herein by reference). | |||
3 | .1 | — | Amended and Restated Certificate of Incorporation of the Company. | |||
3 | .2 | — | Amended and Restated Bylaws of the Company. | |||
4 | .1 | — | Specimen Certificate for shares of Common Stock, par value $0.01 per share, of the Company (filed as Exhibit 3 to the Company’sForm 8-A/A, Amendment No. 2, dated March 11, 2004, and incorporated herein by reference). | |||
4 | .2 | — | Indenture, dated November 17, 2006, among HCA Inc., the guarantors party thereto and The Bank of New York, as trustee (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .3 | — | Security Agreement, dated as of November 17, 2006, among HCA Inc., the subsidiary grantors party thereto and The Bank of New York, as collateral agent (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .4 | — | Pledge Agreement, dated as of November 17, 2006, among HCA Inc., the subsidiary pledgors party thereto and The Bank of New York, as collateral agent (filed as Exhibit 4.3 to the Company’s Current Report ofForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .5 | — | Registration Rights Agreement, dated as of November 17, 2006, among HCA Inc., the subsidiary guarantors party thereto and the Initial Purchasers (filed as Exhibit 4.4 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .6(a) | — | Form of 91/8% Senior Secured Notes due 2014 (included in Exhibit 4.2). | |||
4 | .6(b) | — | Form of 91/4% Senior Secured Notes due 2016 (included in Exhibit 4.2). | |||
4 | .6(c) | — | Form of 95/8%/103/8% Senior Secured Toggle Notes due 1016 (included in Exhibit 4.2). | |||
4 | .7(a) | — | $13,550,000,000 — €1,000,000,000 Credit Agreement, dated as of November 17, 2006, among HCA Inc., HCA UK Capital Limited, the lending institutions from time to time parties thereto, Banc of America Securities LLC, J.P. Morgan Securities Inc., Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint lead arrangers and joint bookrunners, Bank of America, N.A., as administrative agent, JPMorgan Chase Bank, N.A. and Citicorp North America, Inc., asco-syndication agents and Merrill Lynch Capital Corporation, as documentation agent (filed as Exhibit 4.8 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .7(b) | — | Amendment No. 1 to the Credit Agreement, dated as of February 16, 2007, among HCA Inc., HCA UK Capital Limited, the lending institutions from time to time parties thereto, Bank of America, N.A., as administrative agent, JPMorgan Chase Bank, N.A., and Citicorp North America, Inc., asCo-Syndication Agents, Banc of America Securities, LLC, J.P. Morgan Securities Inc., Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as Joint Lead Arrangers and Bookrunners, Deutsche Bank Securities and Wachovia Capital Markets LLC, as Joint Bookrunners and Merrill Lynch Capital Corporation, as Documentation Agent (filed as Exhibit 4.7(b) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference). |
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4 | .8 | — | U.S. Guarantee, dated November 17, 2006, among HCA Inc., the subsidiary guarantors party thereto and Bank of America, N.A., as administrative agent (filed as Exhibit 4.9 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .9 | — | Security Agreement, dated November 17, 2006, among HCA Inc., the subsidiary grantors party thereto and Bank of America, N.A., as collateral agent (filed as Exhibit 4.10 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .10 | — | Pledge Agreement, dated November 17, 2006, among HCA Inc., the subsidiary pledgors party thereto and Bank of America, N.A., as collateral agent (filed as Exhibit 4.11 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .11 | — | $2,000,000,000 Credit Agreement, dated as of November 17, 2006, among HCA Inc., the subsidiary borrowers parties thereto, the lending institutions from time to time parties thereto, Banc of America Securities LLC, J.P. Morgan Securities Inc., Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint lead arrangers and joint bookrunners, Bank of America, N.A., as administrative agent, JPMorgan Chase Bank, N.A. and Citicorp North America, Inc., as co-syndication agents and Merrill Lynch Capital Corporation, as documentation agent (filed as Exhibit 4.12 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .12 | — | Security Agreement, dated as of November 17, 2006, among HCA Inc., the subsidiary borrowers party thereto and Bank of America, N.A., as collateral agent (filed as Exhibit 4.13 to the Company’s Current Report onForm 8-K filed November 24, 2006, and incorporated herein by reference). | |||
4 | .13(a) | — | General Intercreditor Agreement, dated as of November 17, 2006, between Bank of America, N.A., as First Lien Collateral Agent, and The Bank of New York, as Junior Lien Collateral Agent (filed as Exhibit 4.13(a) to the Company’s Registration Statement on Form S-4 (File No. 333-145054), and incorporated herein by reference). | |||
4 | .13(b) | — | Receivables Intercreditor Agreement, dated as of November 17, 2006, among Bank of America, N.A., as ABL Collateral Agent, Bank of America, N.A., as CF Collateral Agent and The Bank of New York, as Bonds Collateral Agent (filed as Exhibit 4.13(b) to the Company’s Registration Statement on Form S-4 (File No. 333-145054), and incorporated herein by reference). | |||
4 | .14 | — | Registration Rights Agreement, dated as of November 17, 2006, among HCA Inc., Hercules Holding II, LLC and certain other parties thereto. | |||
4 | .15 | — | Registration Rights Agreement, dated as of March 16, 1989, by and among HCA-Hospital Corporation of America and the persons listed on the signature pages thereto (filed as Exhibit(g)(24) to Amendment No. 3 to theSchedule 13E-3 filed by HCA-Hospital Corporation of America, Hospital Corporation of America and The HCA Profit Sharing Plan on March 22, 1989, and incorporated herein by reference). | |||
4 | .16 | — | Assignment and Assumption Agreement, dated as of February 10, 1994, between HCA-Hospital Corporation of America and the Company relating to the Registration Rights Agreement, as amended (filed as Exhibit 4.7 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 1993, and incorporated herein by reference). | |||
4 | .17(a) | — | Indenture, dated as of December 16, 1993 between the Company and The First National Bank of Chicago, as Trustee (filed as Exhibit 4.11 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 1993, and incorporated herein by reference). | |||
4 | .17(b) | — | First Supplemental Indenture, dated as of May 25, 2000 between the Company and Bank One Trust Company, N.A., as Trustee (filed as Exhibit 4.4 to the Company’s Quarterly Report onForm 10-Q for the quarter ended June 30, 2000, and incorporated herein by reference). | |||
4 | .17(c) | — | Second Supplemental Indenture, dated as of July 1, 2001 between the Company and Bank One Trust Company, N.A., as Trustee (filed as Exhibit 4.1 to the Company’s Quarterly Report onForm 10-Q for the quarter ended June 30, 2001, and incorporated herein by reference). | |||
4 | .17(d) | — | Third Supplemental Indenture, dated as of December 5, 2001 between the Company and The Bank of New York, as Trustee (filed as Exhibit 4.5(d) to the Company’s Annual Report ofForm 10-K for the fiscal year ended December 31, 2001, and incorporated herein by reference). | |||
4 | .17(e) | — | Fourth Supplemental Indenture, dated as of November 14, 2006, between the Company and The Bank of New York, as Trustee (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K filed November 16, 2006, and incorporated herein by reference). |
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4 | .18 | — | Form of 7.5% Debentures due 2023 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated December 15, 1993, and incorporated herein by reference). | |||
4 | .19 | — | Form of 8.36% Debenture due 2024 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated April 20, 1994, and incorporated herein by reference). | |||
4 | .20 | — | Form of Fixed Rate Global Medium Term Note (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated July 11, 1994, and incorporated herein by reference). | |||
4 | .21 | — | Form of Floating Rate Global Medium Term Note (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated July 11, 1994, and incorporated herein by reference). | |||
4 | .22 | — | Form of 7.69% Note due 2025 (filed as Exhibit 4.10 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2004, and incorporated herein by reference). | |||
4 | .23 | — | Form of 7.19% Debenture due 2015 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated November 20, 1995, and incorporated herein by reference). | |||
4 | .24 | — | Form of 7.50% Debenture due 2095 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated November 20, 1995, and incorporated herein by reference). | |||
4 | .25 | — | Form of 7.05% Debenture due 2027 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated December 5, 1995, and incorporated herein by reference). | |||
4 | .26 | — | Form of Fixed Rate Global Medium Term Note (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated July 2, 1996, and incorporated herein by reference). | |||
4 | .27(a) | — | 8.750% Note in the principal amount of $400,000,000 due 2010 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated August 23, 2000, and incorporated herein by reference). | |||
4 | .27(b) | — | 8.750% Note in the principal amount of $350,000,000 due 2010 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated August 23, 2000, and incorporated herein by reference). | |||
4 | .28 | — | 8.75% Note due 2010 in the principal amount of £150,000,000 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated October 25, 2000, and incorporated herein by reference). | |||
4 | .29(a) | — | 77/8% Note in the principal amount of $100,000,000 due 2011 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated January 23, 2001, and incorporated herein by reference). | |||
4 | .29(b) | — | 77/8% Note in the principal amount of $400,000,000 due 2011 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated January 23, 2001, and incorporated herein by reference). | |||
4 | .30(a) | — | 6.95% Note due 2012 in the principal amount of $400,000,000. (filed as Exhibit 4.5 to the Company’s Current Report onForm 8-K dated April 23, 2002, and incorporated herein by reference). | |||
4 | .30(b) | — | 6.95% Note due 2012 in the principal amount of $100,000,000. (filed as Exhibit 4.6 to the Company’s Current Report onForm 8-K dated April 23, 2002, and incorporated herein by reference). | |||
4 | .31(a) | — | 6.30% Note due 2012 in the principal amount of $400,000,000. (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated September 18, 2002, and incorporated herein by reference). | |||
4 | .31(b) | — | 6.30% Note due 2012 in the principal amount of $100,000,000. (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated September 18, 2002, and incorporated herein by reference). | |||
4 | .32(a) | — | 6.25% Note due 2013 in the principal amount of $400,000,000 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated February 5, 2003, and incorporated herein by reference). | |||
4 | .32(b) | — | 6.25% Note due 2013 in the principal amount of $100,000,000 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated February 5, 2003, and incorporated herein by reference). | |||
4 | .33(a) | — | 63/4% Note due 2013 in the principal amount of $400,000,000 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated July 23, 2003, and incorporated herein by reference). | |||
4 | .33(b) | — | 63/4% Note due 2013 in the principal amount of $100,000,000 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated July 23, 2003, and incorporated herein by reference). | |||
4 | .34 | — | 7.50% Note due 2033 in the principal amount of $250,000,000 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated November 6, 2003, and incorporated herein by reference). | |||
4 | .35 | — | 5.75% Note due 2014 in the principal amount of $500,000,000 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated March 8, 2004, and incorporated herein by reference). | |||
4 | .36 | — | 5.500% Note due 2009 in the principal amount of $500,000,000 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K dated November 16, 2004, and incorporated herein by reference). |
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4 | .37(a) | — | 6.375% Note due 2015 in the principal amount of $500,000,000 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K dated November 16, 2004, and incorporated herein by reference). | |||
4 | .37(b) | — | 6.375% Note due 2015 in the principal amount of $250,000,000 (filed as Exhibit 4.3 to the Company’s Current Report onForm 8-K dated November 16, 2004, and incorporated herein by reference). | |||
4 | .38(a) | — | 6.500% Note due 2016 in the principal amount of $500,000,000 (filed as Exhibit 4.1 to the Company’s Current Report onForm 8-K filed on February 8, 2006, and incorporated herein by reference). | |||
4 | .38(b) | — | 6.500% Note due 2016 in the principal amount of $500,000,000 (filed as Exhibit 4.2 to the Company’s Current Report onForm 8-K filed on February 8, 2006, and incorporated herein by reference). | |||
10 | .1(a) | — | Amended and Restated Columbia/HCA Healthcare Corporation 1992 Stock and Incentive Plan (filed as Exhibit 10.7(b) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 1998, and incorporated herein by reference).* | |||
10 | .1(b) | — | First Amendment to Amended and Restated Columbia/HCA Healthcare Corporation 1992 Stock and Incentive Plan (filed as Exhibit 10.2 to the Company’s Quarterly Report onForm 10-Q for the quarter ended September 30, 1999, and incorporated herein by reference).* | |||
10 | .2 | — | HCA-Hospital Corporation of America Nonqualified Initial Option Plan (filed as Exhibit 4.6 to the Company’s Registration Statement onForm S-3 (FileNo. 33-52379), and incorporated herein by reference).* | |||
10 | .3 | — | Form of Indemnity Agreement with certain officers and directors (filed as Exhibit 10(kk) to Galen Health Care, Inc.’s Registration Statement on Form 10, as amended, and incorporated herein by reference). | |||
10 | .4 | — | Form of Galen Health Care, Inc. 1993 Adjustment Plan (filed as Exhibit 4.15 to the Company’s Registration Statement onForm S-8 (FileNo. 33-50147), and incorporated herein by reference).* | |||
10 | .5 | — | HCA-Hospital Corporation of America 1992 Stock Compensation Plan (filed as Exhibit 10(t) toHCA-Hospital Corporation of America’s Registration Statement onForm S-1 (FileNo. 33-44906), and incorporated herein by reference).* | |||
10 | .6 | — | Columbia/HCA Healthcare Corporation 2000 Equity Incentive Plan (filed as Exhibit A to the Company’s Proxy Statement for the Annual Meeting of Stockholders on May 25, 2000, and incorporated herein by reference).* | |||
10 | .7 | — | Form of Non-Qualified Stock Option Award Agreement (Officers) (filed as Exhibit 99.2 to the Company’s Current Report onForm 8-K dated February 2, 2005, and incorporated herein by reference).* | |||
10 | .8 | — | HCA 2005 Equity Incentive Plan (filed as Exhibit B to the Company’s Proxy Statement for the Annual Meeting of Shareholders on May 26, 2005, and incorporated herein by reference);.* | |||
10 | .9 | — | Form of 2005 Non-Qualified Stock Option Agreement (Officers) (filed as Exhibit 99.2 to the Company’s Current Report onForm 8-K dated October 6, 2005, and incorporated herein by reference).* | |||
10 | .10 | — | Form of 2006 Non-Qualified Stock Option Award Agreement (Officers) (filed as Exhibit 10.2 to the Company’s Current Report onForm 8-K dated February 1, 2006, and incorporated herein by reference).* | |||
10 | .11 | — | 2006 Stock Incentive Plan for Key Employees of HCA Inc. and its Affiliates (filed as Exhibit 10.11 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .12 | — | Management Stockholder’s Agreement dated November 17, 2006 (filed as Exhibit 10.12 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference). | |||
10 | .13 | — | Sale Participation Agreement dated November 17, 2006 (filed as Exhibit 10.13 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference). | |||
10 | .14 | — | Form of Option Rollover Agreement (filed as Exhibit 10.14 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .15 | — | Form of Option Agreement (2007) (filed as Exhibit 10.15 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* |
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10 | .16 | — | Form of Option Agreement (2008).* | |||
10 | .17 | — | Exchange and Purchase Agreement (filed as Exhibit 10.16 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference). | |||
10 | .18 | — | Civil and Administrative Settlement Agreement, dated December 14, 2000 between the Company, the United States Department of Justice and others (filed as Exhibit 99.2 to the Company’s Current Report onForm 8-K dated December 20, 2000, and incorporated herein by reference). | |||
10 | .19 | — | Plea Agreement, dated December 14, 2000 between the Company, Columbia Homecare Group, Inc., Columbia Management Companies, Inc. and the United States Department of Justice (filed as Exhibit 99.3 to the Company’s Current Report onForm 8-K dated December 20, 2000, and incorporated herein by reference). | |||
10 | .20 | — | Corporate Integrity Agreement, dated December 14, 2000 between the Company and the Office of Inspector General of the United States Department of Health and Human Services (filed as Exhibit 99.4 to the Company’s Current Report onForm 8-K dated December 20, 2000, and incorporated herein by reference). | |||
10 | .21 | — | Management Agreement, dated November 17, 2006, among HCA Inc., Bain Capital Partners, LLC, Kohlberg Kravis Roberts & Co. L.P., Dr. Thomas F. Frist Jr., Patricia F. Elcan, William R. Frist and Thomas F. Frist, III, and Merrill Lynch Global Partners, Inc. (filed as Exhibit 10.20 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference). | |||
10 | .22 | — | Retirement Agreement between the Company and Thomas F. Frist, Jr., M.D. dated as of January 1, 2002 (filed as Exhibit 10.30 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2001, and incorporated herein by reference).* | |||
10 | .23(a) | — | HCA Supplemental Executive Retirement Plan dated as of July 1, 2001 (filed as Exhibit 10.31 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2001, and incorporated herein by reference).* | |||
10 | .23(b) | — | First Amendment to the HCA Supplemental Executive Retirement Plan (filed as Exhibit 10.21(b) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2003, and incorporated herein by reference).* | |||
10 | .23(c) | — | Second Amendment to Supplemental Executive Retirement Plan dated November 16, 2006.* | |||
10 | .24 | — | HCA Restoration Plan dated as of January 1, 2001 (filed as Exhibit 10.32 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2001, and incorporated herein by reference).* | |||
10 | .25 | — | HCA Inc. 2006 Senior Officer Performance Excellence Program (filed as Exhibit 10.3 to the Company’s Current Report on8-K filed February 1, 2006, and incorporated herein by reference).* | |||
10 | .26 | — | HCA Inc. 2007 Senior Officer Performance Excellence Program (filed as Exhibit 10.26 to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .27 | — | HCA Inc.2008-2009 Senior Officer Performance Excellence Program.* | |||
10 | .28(a) | — | Employment Agreement dated November 16, 2006 (Jack O. Bovender Jr.) (filed as Exhibit 10.27(a) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .28(b) | — | Employment Agreement dated November 16, 2006 (Richard M. Bracken) (filed as Exhibit 10.27(b) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .28(c) | — | Employment Agreement dated November 16, 2006 (R. Milton Johnson) (filed as Exhibit 10.27(c) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .28(d) | — | Employment Agreement dated November 16, 2006 (Samuel N. Hazen) (filed as Exhibit 10.27(d) to the Company’s Annual Report onForm 10-K for the fiscal year ended December 31, 2006, and incorporated herein by reference).* | |||
10 | .28(e) | — | Employment Agreement dated November 16, 2006 (Beverly B. Wallace).* |
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10 | .28(f) | — | 2008 Named Executive Officer Salaries and Performance Excellence Program Targets.* | |||
10 | .29 | — | Administrative Settlement Agreement dated June 25, 2003 by and between the United States Department of Health and Human Services, acting through the Centers for Medicare and Medicaid Services, and the Company (filed as Exhibit 10.1 to the Company’s Quarterly Report ofForm 10-Q for the quarter ended June 30, 2003, and incorporated herein by reference). | |||
10 | .30 | — | Civil Settlement Agreement by and among the United States of America, acting through the United States Department of Justice and on behalf of the Office of Inspector General of the Department of Health and Human Services, the TRICARE Management Activity (filed as Exhibit 10.2 to the Company’s Quarterly Report ofForm 10-Q for the quarter ended June 30, 2003, and incorporated herein by reference). | |||
10 | .31(a) | — | $2.5 billion Credit Agreement, dated November 9, 2004, by and among the Company, the several banks and other financial institutions from time to time parties hereto, J.P. Morgan Securities Inc., as Sole Advisor, Lead Arranger and Bookrunner, certain other agents and arrangers and JPMorgan Chase Bank, as Administrative Agent (filed as Exhibit 10.1 to the Company’s Current Report onForm 8-K dated November 10, 2004, and incorporated herein by reference). | |||
10 | .31(b) | — | First Amendment to $2.5 billion Credit Agreement, dated November 3, 2005 (filed as Exhibit 10.1 to the Company’s Current Report onForm 8-K filed November 3, 2005, and incorporated herein by reference). | |||
10 | .32 | — | $1.0 billion Credit Agreement, dated November 3, 2005, by and among the Company, the Several banks and other financial institutions from time to time parties thereto, J.P. Morgan Securities Inc., Merrill Lynch & Co., and Merrill Lynch, Pierce, Fenner & Smith, incorporated, as Joint Lead Arrangers & Joint Bookrunners, Merrill Lynch Capital Corporation, as Syndication Agent, and J.P. Morgan Chase Bank, as Administrative Agent (filed as Exhibit 10.2 to the Company’s Current Report onForm 8-K filed on November 3, 2005, and incorporated herein by reference). | |||
10 | .33 | — | $2,000,000,000 Amended and Restated Credit Agreement, dated as of June 20, 2007, among HCA Inc., the subsidiary borrowers parties thereto, the lending institutions from time to time parties thereto, Banc of America Securities LLC, J.P. Morgan Securities Inc., Citigroup Global Markets Inc. and Merrill Lynch, Pierce, Fenner & Smith Incorporated, as joint lead arrangers and joint bookrunners, Bank of America, N.A., as administrative agent, JPMorgan Chase Bank, N.A. and Citicorp North America, Inc., as co-syndication agents, and Merrill Lynch Capital Corporation, as documentation agent (filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K filed June 26, 2007, and incorporated herein by reference). | |||
21 | — | List of Subsidiaries. | ||||
23 | — | Consent of Ernst & Young LLP. | ||||
31 | .1 | — | Certification of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||
31 | .2 | — | Certification of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. | |||
32 | — | Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of theSarbanes-Oxley Act of 2002. |
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By: | /s/Jack O. Bovender, Jr. |
Signature | Title | Date | ||||
/s/Jack O. Bovender, Jr. Jack O. Bovender, Jr. | Chairman of the Board and Chief Executive Officer (Principal Executive Officer) | March 27, | ||||
/s/Richard M. Bracken Richard M. Bracken | President, Chief Operating Officer and Director | March 27, | ||||
/s/R. Milton Johnson R. Milton Johnson | Executive Vice President and Chief Financial Officer (Principal Financial Officer) | March 27, | ||||
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/s/ Christopher J. Birosak | Director | March 27, | ||||
/s/ George A. Bitar | Director | March 27, | ||||
/s/ John P. Connaughton | Director | March 27, |
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/s/ Thomas F. Frist, Jr., M.D. Thomas F. Frist, Jr., M.D. | Director | March 27, 2008 | ||||
/s/ Thomas F. Frist, III Thomas F. Frist, III | Director | March 27, 2008 | ||||
/s/ Christopher R. Gordon Christopher R. Gordon | Director | March 27, 2008 | ||||
/s/ Michael W. Michelson Michael W. Michelson | Director | March 27, 2008 | ||||
/s/ James C. Momtazee James C. Momtazee | Director | March 27, 2008 | ||||
/s/ Stephen G. Pagliuca Stephen G. Pagliuca | Director | March 27, 2008 | ||||
/s/ Peter M. Stavros Peter M. Stavros | Director | March 27, 2008 | ||||
/s/ Nathan C. Thorne Nathan C. Thorne | Director | March 27, 2008 |
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F-2 | |||||
Consolidated Financial Statements: | |||||
2005 | F-3 | ||||
2006 | F-4 | ||||
2005 | F-5 | ||||
2005 | F-6 | ||||
F-7 | |||||
F-44 |
F-1
F-1
F-2
F-2
2006 | 2005 | 2004 | |||||||||||
Revenues | $ | 25,477 | $ | 24,455 | $ | 23,502 | |||||||
Salaries and benefits | 10,409 | 9,928 | 9,419 | ||||||||||
Supplies | 4,322 | 4,126 | 3,901 | ||||||||||
Other operating expenses | 4,057 | 4,039 | 3,797 | ||||||||||
Provision for doubtful accounts | 2,660 | 2,358 | 2,669 | ||||||||||
Gains on investments | (243 | ) | (53 | ) | (56 | ) | |||||||
Equity in earnings of affiliates | (197 | ) | (221 | ) | (194 | ) | |||||||
Depreciation and amortization | 1,391 | 1,374 | 1,250 | ||||||||||
Interest expense | 955 | 655 | 563 | ||||||||||
Gains on sales of facilities | (205 | ) | (78 | ) | — | ||||||||
Transaction costs | 442 | — | — | ||||||||||
Impairment of long-lived assets | 24 | — | 12 | ||||||||||
23,615 | 22,128 | 21,361 | |||||||||||
Income before minority interests and income taxes | 1,862 | 2,327 | 2,141 | ||||||||||
Minority interests in earnings of consolidated entities | 201 | 178 | 168 | ||||||||||
Income before income taxes | 1,661 | 2,149 | 1,973 | ||||||||||
Provision for income taxes | 625 | 725 | 727 | ||||||||||
Net income | $ | 1,036 | $ | 1,424 | $ | 1,246 | |||||||
2007 | 2006 | 2005 | ||||||||||
Revenues | $ | 26,858 | $ | 25,477 | $ | 24,455 | ||||||
Salaries and benefits | 10,714 | 10,409 | 9,928 | |||||||||
Supplies | 4,395 | 4,322 | 4,126 | |||||||||
Other operating expenses | 4,241 | 4,056 | 4,034 | �� | ||||||||
Provision for doubtful accounts | 3,130 | 2,660 | 2,358 | |||||||||
Gains on investments | (8 | ) | (243 | ) | (53 | ) | ||||||
Equity in earnings of affiliates | (206 | ) | (197 | ) | (221 | ) | ||||||
Depreciation and amortization | 1,426 | 1,391 | 1,374 | |||||||||
Interest expense | 2,215 | 955 | 655 | |||||||||
Gains on sales of facilities | (471 | ) | (205 | ) | (78 | ) | ||||||
Impairment of long-lived assets | 24 | 24 | — | |||||||||
Transaction costs | — | 442 | — | |||||||||
25,460 | 23,614 | 22,123 | ||||||||||
Income before minority interests and income taxes | 1,398 | 1,863 | 2,332 | |||||||||
Minority interests in earnings of consolidated entities | 208 | 201 | 178 | |||||||||
Income before income taxes | 1,190 | 1,662 | 2,154 | |||||||||
Provision for income taxes | 316 | 626 | 730 | |||||||||
Net income | $ | 874 | $ | 1,036 | $ | 1,424 | ||||||
F-3
F-3
2006 | 2005 | ||||||||
ASSETS | |||||||||
Current assets: | |||||||||
Cash and cash equivalents | $ | 634 | $ | 336 | |||||
Accounts receivable, less allowance for doubtful accounts of $3,428 and $2,897 | 3,705 | 3,332 | |||||||
Inventories | 669 | 616 | |||||||
Deferred income taxes | 476 | 372 | |||||||
Other | 594 | 559 | |||||||
6,078 | 5,215 | ||||||||
Property and equipment, at cost: | |||||||||
Land | 1,238 | 1,212 | |||||||
Buildings | 8,178 | 8,063 | |||||||
Equipment | 11,170 | 10,594 | |||||||
Construction in progress | 1,321 | 949 | |||||||
21,907 | 20,818 | ||||||||
Accumulated depreciation | (10,238 | ) | (9,439 | ) | |||||
11,669 | 11,379 | ||||||||
Investments of insurance subsidiary | 1,886 | 2,134 | |||||||
Investments in and advances to affiliates | 679 | 627 | |||||||
Goodwill | 2,601 | 2,626 | |||||||
Deferred loan costs | 614 | 85 | |||||||
Other | 148 | 159 | |||||||
$ | 23,675 | $ | 22,225 | ||||||
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | |||||||||
Current liabilities: | |||||||||
Accounts payable | $ | 1,415 | $ | 1,484 | |||||
Accrued salaries | 675 | 561 | |||||||
Other accrued expenses | 1,193 | 1,264 | |||||||
Long-term debt due within one year | 293 | 586 | |||||||
3,576 | 3,895 | ||||||||
Long-term debt | 28,115 | 9,889 | |||||||
Professional liability risks | 1,309 | 1,336 | |||||||
Deferred income taxes and other liabilities | 1,017 | 1,414 | |||||||
Minority interests in equity of consolidated entities | 907 | 828 | |||||||
Equity securities with contingent redemption rights | 125 | — | |||||||
Stockholders’ (deficit) equity: | |||||||||
Common stock $0.01 par; authorized 125,000,000 shares — 2006 and 1,650,000,000 — 2005; outstanding 92,217,800 shares — 2006 and 417,512,700 shares — 2005 | 1 | 4 | |||||||
Accumulated other comprehensive income | 16 | 130 | |||||||
Retained (deficit) earnings | (11,391 | ) | 4,729 | ||||||
(11,374 | ) | 4,863 | |||||||
$ | 23,675 | $ | 22,225 | ||||||
2007 | 2006 | |||||||
ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 393 | $ | 634 | ||||
Accounts receivable, less allowance for doubtful accounts of $4,289 and $3,428 | 3,895 | 3,705 | ||||||
Inventories | 710 | 669 | ||||||
Deferred income taxes | 592 | 476 | ||||||
Other | 615 | 594 | ||||||
6,205 | 6,078 | |||||||
Property and equipment, at cost: | ||||||||
Land | 1,240 | 1,238 | ||||||
Buildings | 8,518 | 8,178 | ||||||
Equipment | 12,088 | 11,170 | ||||||
Construction in progress | 733 | 1,321 | ||||||
22,579 | 21,907 | |||||||
Accumulated depreciation | (11,137 | ) | (10,238 | ) | ||||
11,442 | 11,669 | |||||||
Investments of insurance subsidiary | 1,669 | 1,886 | ||||||
Investments in and advances to affiliates | 688 | 679 | ||||||
Goodwill | 2,629 | 2,601 | ||||||
Deferred loan costs | 539 | 614 | ||||||
Other | 853 | 148 | ||||||
$ | 24,025 | $ | 23,675 | |||||
LIABILITIES AND STOCKHOLDERS’ DEFICIT | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 1,370 | $ | 1,415 | ||||
Accrued salaries | 780 | 675 | ||||||
Other accrued expenses | 1,391 | 1,193 | ||||||
Long-term debt due within one year | 308 | 293 | ||||||
3,849 | 3,576 | |||||||
Long-term debt | 27,000 | 28,115 | ||||||
Professional liability risks | 1,233 | 1,309 | ||||||
Income taxes and other liabilities | 1,379 | 1,017 | ||||||
Minority interests in equity of consolidated entities | 938 | 907 | ||||||
Equity securities with contingent redemption rights | 164 | 125 | ||||||
Stockholders’ deficit: | ||||||||
Common stock $0.01 par; authorized 125,000,000 shares — 2007 and 2006; outstanding 94,182,400 shares — 2007 and 92,217,800 shares — 2006 | 1 | 1 | ||||||
Capital in excess of par value | 112 | — | ||||||
Accumulated other comprehensive (loss) income | (172 | ) | 16 | |||||
Retained deficit | (10,479 | ) | (11,391 | ) | ||||
(10,538 | ) | (11,374 | ) | |||||
$ | 24,025 | $ | 23,675 | |||||
F-4
F-4
Common Stock | Capital in | Accumulated | ||||||||||||||||||||||||||||||
Excess of | Other | Retained | ||||||||||||||||||||||||||||||
Shares | Par | Par | Comprehensive | Earnings | ||||||||||||||||||||||||||||
(000) | Value | Value | Other | Income | (Deficit) | Total | ||||||||||||||||||||||||||
Balances, December 31, 2003 | 490,718 | $ | 5 | $ | — | $ | 5 | $ | 168 | $ | 6,031 | $ | 6,209 | |||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | 1,246 | 1,246 | ||||||||||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||||||||||
Change in net unrealized gains on investment securities | 10 | 10 | ||||||||||||||||||||||||||||||
Foreign currency translation adjustments | 21 | 21 | ||||||||||||||||||||||||||||||
Defined benefit plans | (6 | ) | (6 | ) | ||||||||||||||||||||||||||||
Total comprehensive income | 25 | 1,246 | 1,271 | |||||||||||||||||||||||||||||
Cash dividends declared | (251 | ) | (251 | ) | ||||||||||||||||||||||||||||
Stock repurchases | (77,382 | ) | (1 | ) | (292 | ) | (2,816 | ) | (3,109 | ) | ||||||||||||||||||||||
Stock options exercised | 7,032 | 224 | (5 | ) | 219 | |||||||||||||||||||||||||||
Employee benefit plan issuances | 2,274 | 68 | 68 | |||||||||||||||||||||||||||||
Balances, December 31, 2004 | 422,642 | 4 | — | — | 193 | 4,210 | 4,407 | |||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | 1,424 | 1,424 | ||||||||||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||||||||||
Change in net unrealized gains on investment securities | (30 | ) | (30 | ) | ||||||||||||||||||||||||||||
Foreign currency translation adjustments | (37 | ) | (37 | ) | ||||||||||||||||||||||||||||
Defined benefit plans | 4 | 4 | ||||||||||||||||||||||||||||||
Total comprehensive income | (63 | ) | 1,424 | 1,361 | ||||||||||||||||||||||||||||
Cash dividends declared | (257 | ) | (257 | ) | ||||||||||||||||||||||||||||
Stock repurchases | (36,692 | ) | (1,208 | ) | (648 | ) | (1,856 | ) | ||||||||||||||||||||||||
Stock options exercised | 27,034 | 1,106 | 1,106 | |||||||||||||||||||||||||||||
Employee benefit plan issuances | 4,529 | 102 | 102 | |||||||||||||||||||||||||||||
Balances, December 31, 2005 | 417,513 | 4 | — | — | 130 | 4,729 | 4,863 | |||||||||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||||||||||
Net income | 1,036 | 1,036 | ||||||||||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||||||||||
Change in net unrealized gains on investment securities | (102 | ) | (102 | ) | ||||||||||||||||||||||||||||
Foreign currency translation adjustments | 19 | 19 | ||||||||||||||||||||||||||||||
Defined benefit plans | (49 | ) | (49 | ) | ||||||||||||||||||||||||||||
Change in fair value of derivative instruments | 18 | 18 | ||||||||||||||||||||||||||||||
Total comprehensive income | (114 | ) | 1,036 | 922 | ||||||||||||||||||||||||||||
Recapitalization — repurchase of common stock | (411,957 | ) | (4 | ) | (5,005 | ) | (16,364 | ) | (21,373 | ) | ||||||||||||||||||||||
Recapitalization — equity contribution | 92,218 | 1 | 4,476 | 4,477 | ||||||||||||||||||||||||||||
Cash dividends declared | (139 | ) | (139 | ) | ||||||||||||||||||||||||||||
Stock repurchases | (13,057 | ) | (653 | ) | (653 | ) | ||||||||||||||||||||||||||
Stock options exercised | 3,970 | 163 | 163 | |||||||||||||||||||||||||||||
Employee benefit plan issuances | 3,531 | 366 | 366 | |||||||||||||||||||||||||||||
Balances, December 31, 2006 | 92,218 | $ | 1 | $ | — | $ | — | $ | 16 | $ | (11,391 | ) | $ | (11,374 | ) | |||||||||||||||||
Capital in | Accumulated | |||||||||||||||||||||||
Common Stock | Excess of | Other | Retained | |||||||||||||||||||||
Shares | Par | Par | Comprehensive | Earnings | ||||||||||||||||||||
(000) | Value | Value | Income (Loss) | (Deficit) | Total | |||||||||||||||||||
Balances, December 31, 2004 | 422,642 | $ | 4 | $ | — | $ | 193 | $ | 4,210 | $ | 4,407 | |||||||||||||
Comprehensive income: | ||||||||||||||||||||||||
Net income | 1,424 | 1,424 | ||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||
Change in net unrealized gains on investment securities | (30 | ) | (30 | ) | ||||||||||||||||||||
Foreign currency translation adjustments | (37 | ) | (37 | ) | ||||||||||||||||||||
Defined benefit plans | 4 | 4 | ||||||||||||||||||||||
Total comprehensive income | (63 | ) | 1,424 | 1,361 | ||||||||||||||||||||
Cash dividends declared | (257 | ) | (257 | ) | ||||||||||||||||||||
Stock repurchases | (36,692 | ) | (1,208 | ) | (648 | ) | (1,856 | ) | ||||||||||||||||
Stock options exercised | 27,034 | 1,106 | 1,106 | |||||||||||||||||||||
Employee benefit plan issuances | 4,529 | 102 | 102 | |||||||||||||||||||||
Balances, December 31, 2005 | 417,513 | 4 | — | 130 | 4,729 | 4,863 | ||||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||
Net income | 1,036 | 1,036 | ||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||
Change in net unrealized gains on investment securities | (102 | ) | (102 | ) | ||||||||||||||||||||
Foreign currency translation adjustments | 19 | 19 | ||||||||||||||||||||||
Defined benefit plans | 9 | 9 | ||||||||||||||||||||||
Change in fair value of derivative instruments | 18 | 18 | ||||||||||||||||||||||
Total comprehensive income | (56 | ) | 1,036 | 980 | ||||||||||||||||||||
Recapitalization — repurchase of common stock | (411,957 | ) | (4 | ) | (5,005 | ) | (16,364 | ) | (21,373 | ) | ||||||||||||||
Recapitalization — equity contributions | 92,218 | 1 | 4,476 | 4,477 | ||||||||||||||||||||
Cash dividends declared | (139 | ) | (139 | ) | ||||||||||||||||||||
Stock repurchases | (13,057 | ) | (653 | ) | (653 | ) | ||||||||||||||||||
Stock options exercised | 3,970 | 163 | 163 | |||||||||||||||||||||
Employee benefit plan issuances | 3,531 | 366 | 366 | |||||||||||||||||||||
Adjustment to initially apply FAS 158, net of tax | (58 | ) | (58 | ) | ||||||||||||||||||||
Balances, December 31, 2006 | 92,218 | 1 | — | 16 | (11,391 | ) | (11,374 | ) | ||||||||||||||||
Comprehensive income: | ||||||||||||||||||||||||
Net income | 874 | 874 | ||||||||||||||||||||||
Other comprehensive income: | ||||||||||||||||||||||||
Change in net unrealized gains on investment securities | (2 | ) | (2 | ) | ||||||||||||||||||||
Foreign currency translation adjustments | (15 | ) | (15 | ) | ||||||||||||||||||||
Defined benefit plans | 23 | 23 | ||||||||||||||||||||||
Change in fair value of derivative instruments | (194 | ) | (194 | ) | ||||||||||||||||||||
Total comprehensive income | (188 | ) | 874 | 686 | ||||||||||||||||||||
Equity contributions | 1,961 | 60 | 60 | |||||||||||||||||||||
Share-based compensation | 24 | 24 | ||||||||||||||||||||||
Adjustment to initially apply FIN 48 | 38 | 38 | ||||||||||||||||||||||
Other | 3 | 28 | 28 | |||||||||||||||||||||
Balances, December 31, 2007 | 94,182 | $ | 1 | $ | 112 | $ | (172 | ) | $ | (10,479 | ) | $ | (10,538 | ) | ||||||||||
F-5
F-5
2006 | 2005 | 2004 | |||||||||||||
Cash flows from operating activities: | |||||||||||||||
Net income | $ | 1,036 | $ | 1,424 | $ | 1,246 | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||||||
Provision for doubtful accounts | 2,660 | 2,358 | 2,669 | ||||||||||||
Depreciation and amortization | 1,391 | 1,374 | 1,250 | ||||||||||||
Income taxes | (552 | ) | 162 | 333 | |||||||||||
Gains on sales of facilities | (205 | ) | (78 | ) | — | ||||||||||
Impairment of long-lived assets | 24 | — | 12 | ||||||||||||
Increase (decrease) in cash from operating assets and liabilities: | |||||||||||||||
Accounts receivable | (3,043 | ) | (2,649 | ) | (2,648 | ) | |||||||||
Inventories and other assets | (12 | ) | 28 | (179 | ) | ||||||||||
Accounts payable and accrued expenses | 115 | 343 | 157 | ||||||||||||
Share-based compensation | 324 | 30 | 5 | ||||||||||||
Change in minority interests | 58 | (13 | ) | 109 | |||||||||||
Other | 49 | (8 | ) | — | |||||||||||
Net cash provided by operating activities | 1,845 | 2,971 | 2,954 | ||||||||||||
Cash flows from investing activities: | |||||||||||||||
Purchase of property and equipment | (1,865 | ) | (1,592 | ) | (1,513 | ) | |||||||||
Acquisition of hospitals and health care entities | (112 | ) | (126 | ) | (44 | ) | |||||||||
Disposal of hospitals and health care entities | 651 | 320 | 48 | ||||||||||||
Change in investments | 26 | (311 | ) | (178 | ) | ||||||||||
Other | (7 | ) | 28 | (1 | ) | ||||||||||
Net cash used in investing activities | (1,307 | ) | (1,681 | ) | (1,688 | ) | |||||||||
Cash flows from financing activities: | |||||||||||||||
Issuances of long-term debt | 21,758 | 858 | 2,500 | ||||||||||||
Net change in revolving bank credit facility | (435 | ) | (225 | ) | 190 | ||||||||||
Repayment of long-term debt | (3,728 | ) | (739 | ) | (912 | ) | |||||||||
Repurchases of common stock | (653 | ) | (1,856 | ) | (3,109 | ) | |||||||||
Recapitalization-repurchase of common stock | (20,364 | ) | — | — | |||||||||||
Recapitalization-equity contributions | 3,782 | — | — | ||||||||||||
Payment of debt issuance costs | (586 | ) | — | — | |||||||||||
Issuances of common stock | 108 | 1,009 | 224 | ||||||||||||
Payment of cash dividends | (201 | ) | (258 | ) | (199 | ) | |||||||||
Other | 79 | (1 | ) | (41 | ) | ||||||||||
Net cash used in financing activities | (240 | ) | (1,212 | ) | (1,347 | ) | |||||||||
Change in cash and cash equivalents | 298 | 78 | (81 | ) | |||||||||||
Cash and cash equivalents at beginning of period | 336 | 258 | 339 | ||||||||||||
Cash and cash equivalents at end of period | $ | 634 | $ | 336 | $ | 258 | |||||||||
Interest payments | $ | 893 | $ | 624 | $ | 533 | |||||||||
Income tax payments, net of refunds | $ | 1,087 | $ | 563 | $ | 394 |
2007 | 2006 | 2005 | ||||||||||
Cash flows from operating activities: | ||||||||||||
Net income | $ | 874 | $ | 1,036 | $ | 1,424 | ||||||
Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||
Provision for doubtful accounts | 3,130 | 2,660 | 2,358 | |||||||||
Depreciation and amortization | 1,426 | 1,391 | 1,374 | |||||||||
Income taxes | (105 | ) | (552 | ) | 162 | |||||||
Gains on sales of facilities | (471 | ) | (205 | ) | (78 | ) | ||||||
Impairment of long-lived assets | 24 | 24 | — | |||||||||
Increase (decrease) in cash from operating assets and liabilities: | ||||||||||||
Accounts receivable | (3,345 | ) | (3,043 | ) | (2,649 | ) | ||||||
Inventories and other assets | (241 | ) | (12 | ) | 28 | |||||||
Accounts payable and accrued expenses | (29 | ) | 115 | 343 | ||||||||
Change in minority interests | 40 | 58 | (13 | ) | ||||||||
Share-based compensation | 24 | 324 | 30 | |||||||||
Other | 69 | 49 | (8 | ) | ||||||||
Net cash provided by operating activities | 1,396 | 1,845 | 2,971 | |||||||||
Cash flows from investing activities: | ||||||||||||
Purchase of property and equipment | (1,444 | ) | (1,865 | ) | (1,592 | ) | ||||||
Acquisition of hospitals and health care entities | (32 | ) | (112 | ) | (126 | ) | ||||||
Disposal of hospitals and health care entities | 767 | 651 | 320 | |||||||||
Change in investments | 207 | 26 | (311 | ) | ||||||||
Other | 23 | (7 | ) | 28 | ||||||||
Net cash used in investing activities | (479 | ) | (1,307 | ) | (1,681 | ) | ||||||
Cash flows from financing activities: | ||||||||||||
Issuances of long-term debt | 24 | 21,758 | 858 | |||||||||
Net change in revolving bank credit facility | (520 | ) | (435 | ) | (225 | ) | ||||||
Repayment of long-term debt | (750 | ) | (3,728 | ) | (739 | ) | ||||||
Issuances of common stock | 100 | 108 | 1,009 | |||||||||
Repurchases of common stock | (2 | ) | (653 | ) | (1,856 | ) | ||||||
Recapitalization-repurchase of common stock | — | (20,364 | ) | — | ||||||||
Recapitalization-equity contributions | — | 3,782 | — | |||||||||
Payment of debt issuance costs | (9 | ) | (586 | ) | — | |||||||
Payment of cash dividends | — | (201 | ) | (258 | ) | |||||||
Other | (1 | ) | 79 | (1 | ) | |||||||
Net cash used in financing activities | (1,158 | ) | (240 | ) | (1,212 | ) | ||||||
Change in cash and cash equivalents | (241 | ) | 298 | 78 | ||||||||
Cash and cash equivalents at beginning of period | 634 | 336 | 258 | |||||||||
Cash and cash equivalents at end of period | $ | 393 | $ | 634 | $ | 336 | ||||||
Interest payments | $ | 2,163 | $ | 893 | $ | 624 | ||||||
Income tax payments, net of refunds | $ | 421 | $ | 1,087 | $ | 563 |
F-6
F-6
NOTE 1 — |
F-7
NOTE 1 — | ACCOUNTING POLICIES (Continued) |
F-7
F-8
F-8
NOTE 1 — |
F-9
F-9
NOTE 1 — | ACCOUNTING POLICIES (Continued) |
F-10
F-10
NOTE 1 — |
F-11
F-11
NOTE 1 — | ACCOUNTING POLICIES (Continued) |
F-12
F-12
NOTE 1 — | ACCOUNTING POLICIES (Continued) |
NOTE 2 — | MERGER AND RECAPITALIZATION |
F-13
F-13
NOTE 2 — | MERGER AND RECAPITALIZATION (Continued) |
F-14
F-14
NOTE 2 — |
Compensation expense related to accelerated vesting of stock options and restricted stock, and other employee benefits | $ | 258 | |||
Consulting, legal, accounting and other transaction costs | 131 | ||||
Loss on extinguishment of debt | 53 | ||||
Total | $ | 442 | |||
Compensation expense related to accelerated vesting of stock options and restricted stock, and other employee benefits | $ | 258 | ||
Consulting, legal, accounting and other transaction costs | 131 | |||
Loss on extinguishment of debt | 53 | |||
Total | $ | 442 | ||
NOTE 3 — | SHARE-BASED COMPENSATION |
F-15
F-15
NOTE 3 — | SHARE-BASED COMPENSATION (Continued) |
2005 | 2004 | ||||||||
Net income: | |||||||||
As reported | $ | 1,424 | $ | 1,246 | |||||
Share-based employee compensation expense determined under a fair value method, net of income taxes | 23 | 191 | (a) | ||||||
Pro forma | $ | 1,401 | $ | 1,055 | |||||
F-16
F-16
NOTE 3 — | SHARE-BASED COMPENSATION (Continued) |
Number | Weighted Average | |||||||
of | Grant Date Fair | |||||||
Shares | Value | |||||||
Restricted shares, December 31, 2004 | 1,520 | $ | 40.43 | |||||
Granted | 3,277 | 44.45 | ||||||
Vested | (908 | ) | 42.20 | |||||
Cancelled | (141 | ) | 43.07 | |||||
Restricted shares, December 31, 2005 | 3,748 | 43.42 | ||||||
Granted | 2,979 | 49.11 | ||||||
Vested | (494 | ) | 41.40 | |||||
Cancelled | (232 | ) | 45.98 | |||||
Settled in Recapitalization | (6,001 | ) | 46.31 | |||||
Restricted shares, December 31, 2006 | — | — | ||||||
2006 | 2005 | |||||||
Risk-free interest rate | 4.58 | % | 2.78 | % | ||||
Expected volatility | 14 | % | 23 | % | ||||
Expected life, in years | 0.5 | 0.5 | ||||||
Expected dividend yield | 0.79 | % | 1.20 | % | ||||
Grant date fair value | $ | 9.38 | $ | 9.98 |
F-17
NOTE 3 — | SHARE-BASED COMPENSATION (Continued) |
2006 | 2005 | 2004 | ||||||||||
Risk-free interest rate | 4.70 | % | 3.99 | % | 2.56 | % | ||||||
Expected volatility | 24 | % | 33 | % | 35 | % | ||||||
Expected life, in years | 5 | 5 | 4 | |||||||||
Expected dividend yield | 1.09 | % | 1.27 | % | 1.18 | % |
F-17
2007 | 2006 | 2005 | ||||||||||
Risk-free interest rate | 4.86 | % | 4.70 | % | 3.99 | % | ||||||
Expected volatility | 30 | % | 24 | % | 33 | % | ||||||
Expected life, in years | 5 | 5 | 5 | |||||||||
Expected dividend yield | — | 1.09 | % | 1.27 | % |
Weighted | Weighted | ||||||||||||||||
Average | Average | Aggregate | |||||||||||||||
Stock | Exercise | Remaining | Intrinsic Value | ||||||||||||||
Options | Price | Contractual Term | (dollars in millions) | ||||||||||||||
Options outstanding, December 31, 2003 | 51,681 | $ | 31.64 | ||||||||||||||
Granted | 9,306 | 45.62 | |||||||||||||||
Exercised | (7,208 | ) | 23.79 | ||||||||||||||
Cancelled | (1,517 | ) | 41.11 | ||||||||||||||
Options outstanding, December 31, 2004 | 52,262 | 34.94 | |||||||||||||||
Granted | 2,644 | 49.25 | |||||||||||||||
Exercised | (27,034 | ) | 34.87 | ||||||||||||||
Cancelled | (66 | ) | 42.54 | ||||||||||||||
Options outstanding, December 31, 2005 | 27,806 | 36.35 | |||||||||||||||
Granted | 2,566 | 48.64 | |||||||||||||||
Exercised | (5,220 | ) | 26.24 | ||||||||||||||
Cancelled | (1,008 | ) | 49.76 | ||||||||||||||
Settled in Recapitalization | (13,177 | ) | 36.22 | ||||||||||||||
Rolled over in Recapitalization — existing | (10,967 | ) | 42.98 | ||||||||||||||
Rolled over in Recapitalization — new | 2,285 | 12.50 | �� | ||||||||||||||
Options outstanding, December 31, 2006 | 2,285 | 12.50 | 5.3 | $ | 88 | ||||||||||||
Options exercisable, December 31, 2006 | 2,285 | $ | 12.50 | 5.3 | $ | 88 |
Weighted | Weighted | |||||||||||||||
Average | Average | Aggregate | ||||||||||||||
Stock | Exercise | Remaining | Intrinsic Value | |||||||||||||
Options | Price | Contractual Term | (dollars in millions) | |||||||||||||
Options outstanding, December 31, 2004 | 52,262 | $ | 34.94 | |||||||||||||
Granted | 2,644 | 49.25 | ||||||||||||||
Exercised | (27,034 | ) | 34.87 | |||||||||||||
Cancelled | (66 | ) | 42.54 | |||||||||||||
Options outstanding, December 31, 2005 | 27,806 | 36.35 | ||||||||||||||
Granted | 2,566 | 48.64 | ||||||||||||||
Exercised | (5,220 | ) | 26.24 | |||||||||||||
Cancelled | (1,008 | ) | 49.76 | |||||||||||||
Settled in Recapitalization | (13,177 | ) | 36.22 | |||||||||||||
Rolled over in Recapitalization — existing | (10,967 | ) | 42.98 | |||||||||||||
Rolled over in Recapitalization — new | 2,285 | 12.50 | ||||||||||||||
Options outstanding, December 31, 2006 | 2,285 | 12.50 | ||||||||||||||
Granted | 9,328 | 51.34 | ||||||||||||||
Exercised | (36 | ) | 12.75 | |||||||||||||
Cancelled | (405 | ) | 51.00 | |||||||||||||
Options outstanding, December 31, 2007 | 11,172 | 43.54 | 8.2 | $ | 195 | |||||||||||
Options exercisable, December 31, 2007 | 2,249 | $ | 12.50 | 4.3 | $ | 109 |
F-18
F-18
NOTE 4 — |
Number | Weighted Average | ||||||||
of | Grant Date Fair | ||||||||
Shares | Value | ||||||||
Restricted shares, December 31, 2003 | 1,739 | $ | 39.96 | ||||||
Granted | 880 | 42.13 | |||||||
Vested | (1,003 | ) | 41.17 | ||||||
Cancelled | (96 | ) | 39.65 | ||||||
Restricted shares, December 31, 2004 | 1,520 | 40.43 | |||||||
Granted | 3,277 | 44.45 | |||||||
Vested | (908 | ) | 42.20 | ||||||
Cancelled | (141 | ) | 43.07 | ||||||
Restricted shares, December 31, 2005 | 3,748 | 43.42 | |||||||
Granted | 2,979 | 49.11 | |||||||
Vested | (494 | ) | 41.40 | ||||||
Cancelled | (232 | ) | 45.98 | ||||||
Settled in Recapitalization | (6,001 | ) | 46.31 | ||||||
Restricted shares, December 31, 2006 | — | — | |||||||
2006 | 2005 | 2004 | ||||||||||
Risk-free interest rate | 4.58 | % | 2.78 | % | 1.32 | % | ||||||
Expected volatility | 14 | % | 23 | % | 20 | % | ||||||
Expected life, in years | 0.5 | 0.5 | 0.5 | |||||||||
Expected dividend yield | 0.79 | % | 1.20 | % | 1.26 | % | ||||||
Grant date fair value | $ | 9.38 | $ | 9.98 | $ | 8.48 |
F-19
NOTE 5 — | IMPAIRMENTS OF LONG-LIVED ASSETS |
F-20
NOTE 6 — | INCOME TAXES |
2006 | 2005 | 2004 | |||||||||||
Current: | |||||||||||||
Federal | $ | 993 | $ | 668 | $ | 466 | |||||||
State | 62 | 63 | 63 | ||||||||||
Foreign | 35 | 37 | 25 | ||||||||||
Deferred: | |||||||||||||
Federal | (427 | ) | (43 | ) | 132 | ||||||||
State | (43 | ) | 3 | 17 | |||||||||
Foreign | 5 | (3 | ) | 24 | |||||||||
$ | 625 | $ | 725 | $ | 727 | ||||||||
2007 | 2006 | 2005 | ||||||||||
Current: | ||||||||||||
Federal. | $566 | $ | 993 | $ | 668 | |||||||
State | 37 | 62 | 63 | |||||||||
Foreign | 32 | 35 | 37 | |||||||||
Deferred: | ||||||||||||
Federal | (391 | ) | (426 | ) | (39 | ) | ||||||
State | (62 | ) | (43 | ) | 4 | |||||||
Foreign | 134 | 5 | (3 | ) | ||||||||
$316 | $ | 626 | $ | 730 | ||||||||
F-19
NOTE 6 — | INCOME TAXES (Continued) |
2006 | 2005 | 2004 | ||||||||||
Federal statutory rate | 35.0 | % | 35.0 | % | 35.0 | % | ||||||
State income taxes, net of federal income tax benefit | 0.4 | 2.1 | 2.6 | |||||||||
Nondeductible intangible assets | 1.5 | 0.6 | — | |||||||||
IRS settlement | — | (2.2 | ) | — | ||||||||
Repatriation of foreign earnings | — | (1.1 | ) | — | ||||||||
Other items, net | 0.7 | (0.6 | ) | (0.8 | ) | |||||||
Effective income tax rate | 37.6 | % | 33.8 | % | 36.8 | % | ||||||
2007 | 2006 | 2005 | ||||||||||
Federal statutory rate | 35.0 | % | 35.0 | % | 35.0 | % | ||||||
State income taxes, net of federal income tax benefit | 0.2 | 0.4 | 2.1 | |||||||||
Change in liability for uncertain tax positions | (7.2 | ) | — | — | ||||||||
Settlements of tax examinations | — | — | (2.2 | ) | ||||||||
Nondeductible intangible assets | — | 1.5 | 0.6 | |||||||||
Repatriation of foreign earnings | — | — | (1.1 | ) | ||||||||
Other items, net | (1.4 | ) | 0.7 | (0.5 | ) | |||||||
Effective income tax rate | 26.6 | % | 37.6 | % | 33.9 | % | ||||||
2006 | 2005 | |||||||||||||||
Assets | Liabilities | Assets | Liabilities | |||||||||||||
Depreciation and fixed asset basis differences | $ | — | $ | 485 | $ | — | $ | 632 | ||||||||
Allowances for professional liability and other risks | 118 | — | 124 | — | ||||||||||||
Doubtful accounts | 424 | — | 155 | — | ||||||||||||
Compensation | 129 | — | 185 | — | ||||||||||||
Other | 272 | 372 | 235 | 525 | ||||||||||||
$ | 943 | $ | 857 | $ | 699 | $ | 1,157 | |||||||||
F-21
2007 | 2006 | |||||||||||||||
Assets | Liabilities | Assets | Liabilities | |||||||||||||
Depreciation and fixed asset basis differences | $ | — | $ | 329 | $ | — | $ | 485 | ||||||||
Allowances for professional liability and other risks | 197 | — | 118 | — | ||||||||||||
Accounts receivable | 884 | — | 424 | — | ||||||||||||
Compensation | 156 | — | 129 | — | ||||||||||||
Other | 633 | 259 | 475 | 215 | ||||||||||||
$ | 1,870 | $ | 588 | $ | 1,146 | $ | 700 | |||||||||
F-20
NOTE 6 — | INCOME TAXES (Continued) |
Balance at January 1, 2007 | $ | 555 | ||
Additions based on tax positions related to the current year | 70 | |||
Additions for tax positions of prior years | 112 | |||
Reductions for tax positions of prior years | (101 | ) | ||
Settlements | 2 | |||
Lapse of applicable statutes of limitations | (16 | ) | ||
Balance at December 31, 2007 | $ | 622 | ||
F-21
F-22
NOTE 6 — | INCOME TAXES (Continued) |
NOTE 7 — | INVESTMENTS OF INSURANCE SUBSIDIARY |
2006 | |||||||||||||||||
Unrealized | |||||||||||||||||
Amounts | |||||||||||||||||
Amortized | Fair | ||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||
Debt securities: | |||||||||||||||||
States and municipalities | $ | 1,174 | $ | 24 | $ | (3 | ) | $ | 1,195 | ||||||||
Asset-backed securities | 64 | 4 | — | 68 | |||||||||||||
Corporate and other | 8 | — | — | 8 | |||||||||||||
Money market funds | 858 | — | — | 858 | |||||||||||||
2,104 | 28 | (3 | ) | 2,129 | |||||||||||||
Equity securities: | |||||||||||||||||
Preferred stocks | 10 | — | (1 | ) | 9 | ||||||||||||
Common stocks | 4 | 1 | — | 5 | |||||||||||||
14 | 1 | (1 | ) | 14 | |||||||||||||
$ | 2,118 | $ | 29 | $ | (4 | ) | 2,143 | ||||||||||
Amounts classified as current assets | (257 | ) | |||||||||||||||
Investment carrying value | $ | 1,886 | |||||||||||||||
2005 | |||||||||||||||||
Unrealized | |||||||||||||||||
Amounts | |||||||||||||||||
Amortized | Fair | ||||||||||||||||
Cost | Gains | Losses | Value | ||||||||||||||
Debt securities: | |||||||||||||||||
States and municipalities | $ | 1,199 | $ | 27 | $ | (5 | ) | $ | 1,221 | ||||||||
Asset-backed securities | 41 | 4 | — | 45 | |||||||||||||
Corporate and other | 22 | 1 | — | 23 | |||||||||||||
Money market funds | 130 | — | — | 130 | |||||||||||||
1,392 | 32 | (5 | ) | 1,419 | |||||||||||||
Equity securities: | |||||||||||||||||
Preferred stocks | 10 | — | — | 10 | |||||||||||||
Common stocks | 798 | 161 | (4 | ) | 955 | ||||||||||||
808 | 161 | (4 | ) | 965 | |||||||||||||
$ | 2,200 | $ | 193 | $ | (9 | ) | 2,384 | ||||||||||
Amounts classified as current assets | (250 | ) | |||||||||||||||
Investment carrying value | $ | 2,134 | |||||||||||||||
2007 | ||||||||||||||||
Unrealized | ||||||||||||||||
Amortized | Amounts | Fair | ||||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
Debt securities: | ||||||||||||||||
States and municipalities | $ | 1,675 | $ | 23 | $ | (2 | ) | $ | 1,696 | |||||||
Asset-backed securities | 59 | 1 | — | 60 | ||||||||||||
Corporate and other | 5 | — | — | 5 | ||||||||||||
Money market funds | 109 | — | — | 109 | ||||||||||||
1,848 | 24 | (2 | ) | 1,870 | ||||||||||||
Equity securities: | ||||||||||||||||
Preferred stocks | 26 | — | (1 | ) | 25 | |||||||||||
Common stocks | 4 | — | — | 4 | ||||||||||||
30 | — | (1 | ) | 29 | ||||||||||||
$ | 1,878 | $ | 24 | $ | (3 | ) | 1,899 | |||||||||
Amounts classified as current assets | (230 | ) | ||||||||||||||
Investment carrying value | $ | 1,669 | ||||||||||||||
F-22
NOTE 7 — | INVESTMENTS OF INSURANCE SUBSIDIARY (Continued) |
2006 | ||||||||||||||||
Unrealized | ||||||||||||||||
Amortized | Amounts | Fair | ||||||||||||||
Cost | Gains | Losses | Value | |||||||||||||
Debt securities: | ||||||||||||||||
States and municipalities | $ | 1,174 | $ | 24 | $ | (3 | ) | $ | 1,195 | |||||||
Asset-backed securities | 64 | 4 | — | 68 | ||||||||||||
Corporate and other | 8 | — | — | 8 | ||||||||||||
Money market funds | 858 | — | — | 858 | ||||||||||||
2,104 | 28 | (3 | ) | 2,129 | ||||||||||||
Equity securities: | ||||||||||||||||
Preferred stocks | 10 | — | (1 | ) | 9 | |||||||||||
Common stocks | 4 | 1 | — | 5 | ||||||||||||
14 | 1 | (1 | ) | 14 | ||||||||||||
$ | 2,118 | $ | 29 | $ | (4 | ) | 2,143 | |||||||||
Amounts classified as current assets | (257 | ) | ||||||||||||||
Investment carrying value | $ | 1,886 | ||||||||||||||
F-23
Amortized | Fair | |||||||
Cost | Value | |||||||
Due in one year or less | $ | 911 | $ | 912 | ||||
Due after one year through five years | 372 | 375 | ||||||
Due after five years through ten years | 478 | 490 | ||||||
Due after ten years | 279 | 284 | ||||||
2,040 | 2,061 | |||||||
Asset-backed securities | 64 | 68 | ||||||
$ | 2,104 | $ | 2,129 | |||||
Amortized | Fair | |||||||
Cost | Value | |||||||
Due in one year or less | $ | 226 | $ | 227 | ||||
Due after one year through five years | 327 | 333 | ||||||
Due after five years through ten years | 344 | 356 | ||||||
Due after ten years | 892 | 894 | ||||||
1,789 | 1,810 | |||||||
Asset-backed securities | 59 | 60 | ||||||
$ | 1,848 | $ | 1,870 | |||||
F-23
NOTE 7 — | INVESTMENTS OF INSURANCE SUBSIDIARY (Continued) |
2006 | 2005 | 2004 | |||||||||||
Debt securities: | |||||||||||||
Cash proceeds | $ | 401 | $ | 173 | $ | 181 | |||||||
Gross realized gains | 1 | 2 | 6 | ||||||||||
Gross realized losses | 2 | 1 | 2 | ||||||||||
Equity securities: | |||||||||||||
Cash proceeds | $ | 1,509 | $ | 440 | $ | 338 | |||||||
Gross realized gains | 256 | 63 | 62 | ||||||||||
Gross realized losses | 12 | 9 | 16 |
2007 | 2006 | 2005 | ||||||||||
Debt securities: | ||||||||||||
Cash proceeds | $ | 272 | $ | 401 | $ | 173 | ||||||
Gross realized gains | 8 | 1 | 2 | |||||||||
Gross realized losses | 1 | 2 | 1 | |||||||||
Equity securities: | ||||||||||||
Cash proceeds | $ | 87 | $ | 1,509 | $ | 440 | ||||||
Gross realized gains | 1 | 256 | 63 | |||||||||
Gross realized losses | — | 12 | 9 |
NOTE 8 — |
F-24
Notional | Fair | |||||||||
Amount | Termination Date | Value | ||||||||
Pay-fixed interest rate swap | $ | 4,000 | November 2011 | $ | 12 | |||||
Pay-fixed interest rate swap | 4,000 | November 2011 | 35 |
Notional | Fair | |||||||||||
Amount | Termination Date | Value | ||||||||||
Pay-fixed interest rate swap | $ | 4,000 | November 2011 | $ | (141 | ) | ||||||
Pay-fixed interest rate swap | 4,000 | November 2011 | (123 | ) |
F-24
NOTE 8 — | FINANCIAL INSTRUMENTS (Continued) |
Notional | Fair | |||||||||
Amount | Termination Date | Value | ||||||||
Euro — United States Dollar Currency Swap | 568 Euro | December 2011 | $ | 22 | ||||||
Euro — Great Britain Pound (GBP) Currency Swap | 251 GBP | December 2011 | (5 | ) |
Notional | Fair | |||||||||||
Amount | Termination Date | Value | ||||||||||
Euro — United States Dollar Currency Swap | 568 Euro | December 2011 | $ | 107 | ||||||||
Euro — Great Britain Pound (GBP) Currency Swap | 41 GBP | December 2011 | 7 |
2006 | 2005 | ||||||||||||||||
Carrying | Fair | Carrying | Fair | ||||||||||||||
Amount | Value | Amount | Value | ||||||||||||||
Assets: | |||||||||||||||||
Investments | $ | 2,143 | $ | 2,143 | $ | 2,384 | $ | 2,384 | |||||||||
Interest rate swaps | 47 | 47 | — | — | |||||||||||||
Cross currency swaps | 17 | 17 | — | — | |||||||||||||
Liabilities: | |||||||||||||||||
Long-term debt | $ | 28,408 | $ | 28,096 | $ | 10,475 | $ | 10,733 | |||||||||
Interest rate swaps | — | — | 25 | 25 |
2007 | 2006 | |||||||||||||||
Carrying | Fair | Carrying | Fair | |||||||||||||
Amount | Value | Amount | Value | |||||||||||||
Assets: | ||||||||||||||||
Investments of insurance subsidiary | $ | 1,899 | $ | 1,899 | $ | 2,143 | $ | 2,143 | ||||||||
Interest rate swaps (Other assets) | — | — | 47 | 47 | ||||||||||||
Cross currency swaps (Other assets) | 114 | 114 | 17 | 17 | ||||||||||||
Liabilities: | ||||||||||||||||
Long-term debt | $ | 27,308 | $ | 26,127 | $ | 28,408 | $ | 28,096 | ||||||||
Interest rate swaps (Income taxes and other liabilities) | 264 | 264 | — | — | ||||||||||||
Physician recruiting liability (Income taxes and other liabilities) | 22 | 22 | 14 | 14 |
F-25
F-25
NOTE 9 — | LONG-TERM DEBT |
2006 | 2005 | ||||||||
Senior secured asset-based revolving credit facility (effective interest rate of 7.1%) | $ | 1,830 | $ | — | |||||
Senior secured revolving credit facility (effective interest rate of 7.9%) | 40 | — | |||||||
Senior secured term loan facilities (effective interest rate of 7.5%) | 12,870 | — | |||||||
Other senior secured debt (effective interest rate of 6.7%) | 445 | 281 | |||||||
First lien debt | 15,185 | 281 | |||||||
Senior secured cash-pay notes (effective interest rate of 9.6%) | 4,200 | — | |||||||
Senior secured toggle notes (effective interest rate of 10.0%) | 1,500 | — | |||||||
Second lien debt | 5,700 | — | |||||||
Senior unsecured notes payable through 2095 (effective interest rate of 7.3%) | 7,523 | 8,419 | |||||||
Senior unsecured revolving credit facility | — | 475 | |||||||
Senior unsecured term loan facilities | — | 1,300 | |||||||
Total debt (average life of eight years, rates averaging 7.9%) | 28,408 | 10,475 | |||||||
Less amounts due within one year | 293 | 586 | |||||||
$ | 28,115 | $ | 9,889 | ||||||
2007 | 2006 | |||||||
Senior secured asset-based revolving credit facility (effective interest rate of 6.4%) | $ | 1,350 | $ | 1,830 | ||||
Senior secured revolving credit facility | — | 40 | ||||||
Senior secured term loan facilities (effective interest rate of 7.0%) | 12,317 | 12,870 | ||||||
Other senior secured debt (effective interest rate of 6.7%) | 427 | 445 | ||||||
First lien debt | 14,094 | 15,185 | ||||||
Senior secured cash-pay notes (effective interest rate of 9.6%) | 4,200 | 4,200 | ||||||
Senior secured toggle notes (effective interest rate of 10.0%) | 1,500 | 1,500 | ||||||
Second lien debt | 5,700 | 5,700 | ||||||
Senior unsecured notes payable through 2095 (effective interest rate of 7.3%) | 7,514 | 7,523 | ||||||
Total debt (average life of seven years, rates averaging 7.6%) | 27,308 | 28,408 | ||||||
Less amounts due within one year | 308 | 293 | ||||||
$ | 27,000 | $ | 28,115 | |||||
F-26
F-26
NOTE 9 — | LONG-TERM DEBT (Continued) |
F-27
F-27
NOTE 10 — |
F-28
NOTE 11 — |
F-28
NOTE 11 — | CAPITAL STOCK AND STOCK REPURCHASES (Continued) |
NOTE 12 — | EMPLOYEE BENEFIT PLANS |
F-29
F-29
NOTE 12 — | EMPLOYEE BENEFIT PLANS (Continued) |
At December 31, 2006 | ||||||||||||
Prior to | Effect of | |||||||||||
Adopting | Adopting | |||||||||||
SFAS 158 | SFAS 158 | As Reported | ||||||||||
Intangible pension asset | $ | 31 | $ | (31 | ) | $ | — | |||||
Accrued pension liability | 128 | 71 | 199 | |||||||||
Deferred income taxes | 6 | 36 | 42 | |||||||||
Accumulated other comprehensive income | (15 | ) | (94 | ) | (109 | ) |
F-30
At December 31, 2006 | ||||||||||||
Prior to | Effect of | |||||||||||
Adopting | Adopting | |||||||||||
SFAS 158 | SFAS 158 | As Reported | ||||||||||
Intangible pension asset | $ | 31 | $ | (31 | ) | $ | — | |||||
Accrued pension liability | 128 | 71 | 199 | |||||||||
Deferred income taxes | 6 | 36 | 42 | |||||||||
Accumulated other comprehensive income | (15 | ) | (94 | ) | (109 | ) |
NOTE 13 — | SEGMENT AND GEOGRAPHIC INFORMATION |
F-31
For the Years Ended December 31, | |||||||||||||
2006 | 2005 | 2004 | |||||||||||
Revenues: | |||||||||||||
Eastern Group | $ | 8,609 | $ | 8,225 | $ | 7,854 | |||||||
Central Group | 5,514 | 5,489 | 5,304 | ||||||||||
Western Group | 10,495 | 9,733 | 9,382 | ||||||||||
Corporate and other | 859 | 1,008 | 962 | ||||||||||
$ | 25,477 | $ | 24,455 | $ | 23,502 | ||||||||
Equity in earnings of affiliates: | |||||||||||||
Eastern Group | $ | (4 | ) | $ | (4 | ) | $ | (6 | ) | ||||
Central Group | (5 | ) | (6 | ) | — | ||||||||
Western Group | (187 | ) | (210 | ) | (192 | ) | |||||||
Corporate and other | (1 | ) | (1 | ) | 4 | ||||||||
$ | (197 | ) | $ | (221 | ) | $ | (194 | ) | |||||
Adjusted segment EBITDA: | |||||||||||||
Eastern Group | $ | 1,329 | $ | 1,435 | $ | 1,368 | |||||||
Central Group | 854 | 917 | 856 | ||||||||||
Western Group | 2,088 | 1,994 | 1,831 | ||||||||||
Corporate and other | 198 | (68 | ) | (89 | ) | ||||||||
$ | 4,469 | $ | 4,278 | $ | 3,966 | ||||||||
Depreciation and amortization: | |||||||||||||
Eastern Group | $ | 423 | $ | 413 | $ | 359 | |||||||
Central Group | 309 | 308 | 281 | ||||||||||
Western Group | 492 | 480 | 435 | ||||||||||
Corporate and other | 167 | 173 | 175 | ||||||||||
$ | 1,391 | $ | 1,374 | $ | 1,250 | ||||||||
Adjusted segment EBITDA | $ | 4,469 | $ | 4,278 | $ | 3,966 | |||||||
Depreciation and amortization | 1,391 | 1,374 | 1,250 | ||||||||||
Interest expense | 955 | 655 | 563 | ||||||||||
Gains on sales of facilities | (205 | ) | (78 | ) | — | ||||||||
Transaction costs | 442 | — | — | ||||||||||
Impairment of long-lived assets | 24 | — | 12 | ||||||||||
Income before minority interests and income taxes | $ | 1,862 | $ | 2,327 | $ | 2,141 | |||||||
For The Years Ended December 31, | ||||||||||||
2007 | 2006 | 2005 | ||||||||||
Revenues: | ||||||||||||
Eastern Group | $ | 8,204 | $ | 7,775 | $ | 7,341 | ||||||
Central Group | 6,302 | 5,917 | 5,667 | |||||||||
Western Group | 11,378 | 10,495 | 9,733 | |||||||||
Corporate and other | 974 | 1,290 | 1,714 | |||||||||
$ | 26,858 | $ | 25,477 | $ | 24,455 | |||||||
F-30
F-32
As of December 31, | |||||||||
2006 | 2005 | ||||||||
Assets: | |||||||||
Eastern Group | $ | 5,270 | $ | 5,292 | |||||
Central Group | 4,504 | 4,592 | |||||||
Western Group | 7,714 | 7,096 | |||||||
Corporate and other | 6,187 | 5,245 | |||||||
$ | 23,675 | $ | 22,225 | ||||||
Eastern | Central | Western | Corporate | ||||||||||||||||||
Group | Group | Group | and Other | Total | |||||||||||||||||
Goodwill: | |||||||||||||||||||||
Balance at December 31, 2005 | $ | 701 | $ | 974 | $ | 698 | $ | 253 | $ | 2,626 | |||||||||||
Acquisitions | 2 | — | 36 | — | 38 | ||||||||||||||||
Sales | (57 | ) | (26 | ) | — | (3 | ) | (86 | ) | ||||||||||||
Foreign currency translation and other | (10 | ) | 2 | 1 | 30 | 23 | |||||||||||||||
Balance at December 31, 2006 | $ | 636 | $ | 950 | $ | 735 | $ | 280 | $ | 2,601 | |||||||||||
NOTE 13 — | SEGMENT AND GEOGRAPHIC INFORMATION (Continued) |
For The Years Ended December 31, | ||||||||||||
2007 | 2006 | 2005 | ||||||||||
Equity in earnings of affiliates: | ||||||||||||
Eastern Group | $ | (2 | ) | $ | (6 | ) | $ | (5 | ) | |||
Central Group | 8 | (3 | ) | (6 | ) | |||||||
Western Group | (212 | ) | (187 | ) | (210 | ) | ||||||
Corporate and other | — | (1 | ) | — | ||||||||
$ | (206 | ) | $ | (197 | ) | $ | (221 | ) | ||||
Adjusted segment EBITDA: | ||||||||||||
Eastern Group | $ | 1,268 | $ | 1,196 | $ | 1,299 | ||||||
Central Group | 1,082 | 975 | 998 | |||||||||
Western Group | 2,196 | 2,088 | 1,994 | |||||||||
Corporate and other | 46 | 211 | (8 | ) | ||||||||
$ | 4,592 | $ | 4,470 | $ | 4,283 | |||||||
Depreciation and amortization: | ||||||||||||
Eastern Group | $ | 369 | $ | 363 | $ | 355 | ||||||
Central Group | 364 | 329 | 321 | |||||||||
Western Group | 529 | 492 | 480 | |||||||||
Corporate and other | 164 | 207 | 218 | |||||||||
$ | 1,426 | $ | 1,391 | $ | 1,374 | |||||||
Adjusted segment EBITDA | $ | 4,592 | $ | 4,470 | $ | 4,283 | ||||||
Depreciation and amortization | 1,426 | 1,391 | 1,374 | |||||||||
Interest expense | 2,215 | 955 | 655 | |||||||||
Gains on sales of facilities | (471 | ) | (205 | ) | (78 | ) | ||||||
Impairment of long-lived assets | 24 | 24 | — | |||||||||
Transaction costs | — | 442 | — | |||||||||
Income before minority interests and income taxes | $ | 1,398 | $ | 1,863 | $ | 2,332 | ||||||
As of December 31, | ||||||||
2007 | 2006 | |||||||
Assets: | ||||||||
Eastern Group | $ | 4,928 | $ | 4,803 | ||||
Central Group | 5,157 | 4,930 | ||||||
Western Group | 8,152 | 7,714 | ||||||
Corporate and other | 5,788 | 6,228 | ||||||
$ | 24,025 | $ | 23,675 | |||||
F-31
F-33
NOTE 13 — | SEGMENT AND GEOGRAPHIC INFORMATION (Continued) |
Eastern | Central | Western | Corporate | |||||||||||||||||
Group | Group | Group | and Other | Total | ||||||||||||||||
Goodwill: | ||||||||||||||||||||
Balance at December 31, 2006 | $ | 585 | $ | 1,001 | $ | 735 | $ | 280 | $ | 2,601 | ||||||||||
Acquisitions | 34 | 4 | 6 | — | 44 | |||||||||||||||
Sales | — | (1 | ) | — | (44 | ) | (45 | ) | ||||||||||||
Foreign currency translation and other | 9 | 11 | 8 | 1 | 29 | |||||||||||||||
Balance at December 31, 2007 | $ | 628 | $ | 1,015 | $ | 749 | $ | 237 | $ | 2,629 | ||||||||||
NOTE 14 — | OTHER COMPREHENSIVE INCOME (LOSS) |
Change | |||||||||||||||||||||
Unrealized | Foreign | in Fair | |||||||||||||||||||
Gains on | Currency | Defined | Value of | ||||||||||||||||||
Available-for-Sale | Translation | Benefit | Derivative | ||||||||||||||||||
Securities | Adjustments | Plans | Instruments | Total | |||||||||||||||||
Balances at December 31, 2003 | $ | 138 | $ | 46 | $ | (16 | ) | $ | — | $ | 168 | ||||||||||
Unrealized gains on available-for-sale securities, net of $27 of income taxes | 46 | — | — | — | 46 | ||||||||||||||||
Gains reclassified into earnings from other comprehensive income, net of $20 of income taxes | (36 | ) | — | — | — | (36 | ) | ||||||||||||||
Foreign currency translation adjustments, net of $11 of income taxes | — | 21 | — | — | 21 | ||||||||||||||||
Defined benefit plans, net of $4 income tax benefit | — | — | (6 | ) | — | (6 | ) | ||||||||||||||
Balances at December 31, 2004 | 148 | 67 | (22 | ) | — | 193 | |||||||||||||||
Unrealized gains on available-for-sale securities, net of $3 of income taxes | 3 | — | — | — | 3 | ||||||||||||||||
Gains reclassified into earnings from other comprehensive income, net of $20 of income taxes | (33 | ) | — | — | — | (33 | ) | ||||||||||||||
Foreign currency translation adjustments, net of $19 income tax benefit | — | (37 | ) | — | — | (37 | ) | ||||||||||||||
Defined benefit plans, net of $2 of income taxes | — | — | 4 | — | 4 | ||||||||||||||||
Balances at December 31, 2005 | 118 | 30 | (18 | ) | — | 130 | |||||||||||||||
Unrealized gains on available-for-sale securities, net of $30 of income taxes | 53 | — | — | — | 53 | ||||||||||||||||
Gains reclassified into earnings from other comprehensive income, net of $88 of income taxes | (155 | ) | — | — | — | (155 | ) | ||||||||||||||
Foreign currency translation adjustments, net of $10 of income taxes | — | 19 | — | — | 19 | ||||||||||||||||
Defined benefit plans, net of $30 of income tax benefit | — | — | (49 | ) | — | (49 | ) | ||||||||||||||
Change in fair value of derivative instruments, net of $10 of income taxes | — | — | — | 18 | 18 | ||||||||||||||||
Balances at December 31, 2006 | $ | 16 | $ | 49 | $ | (67 | ) | $ | 18 | $ | 16 | ||||||||||
Change | ||||||||||||||||||||
Unrealized | Foreign | in Fair | ||||||||||||||||||
Gains on | Currency | Defined | Value of | |||||||||||||||||
Available-for-Sale | Translation | Benefit | Derivative | |||||||||||||||||
Securities | Adjustments | Plans | Instruments | Total | ||||||||||||||||
Balances at December 31, 2004 | $ | 148 | $ | 67 | $ | (22 | ) | $ | — | $ | 193 | |||||||||
Unrealized gains on available-for-sale securities, net of $3 of income taxes | 3 | — | — | — | 3 | |||||||||||||||
Gains reclassified into earnings from other comprehensive income, net of $20 of income taxes | (33 | ) | — | — | — | (33 | ) | |||||||||||||
Foreign currency translation adjustments, net of $19 income tax benefit | — | (37 | ) | — | — | (37 | ) | |||||||||||||
Defined benefit plans, net of $2 of income taxes | — | — | 4 | — | 4 | |||||||||||||||
Balances at December 31, 2005 | 118 | 30 | (18 | ) | — | 130 | ||||||||||||||
Unrealized gains on available-for-sale securities, net of $30 of income taxes | 53 | — | — | — | 53 | |||||||||||||||
Gains reclassified into earnings from other comprehensive income, net of $88 of income taxes | (155 | ) | — | — | — | (155 | ) | |||||||||||||
Foreign currency translation adjustments, net of $10 of income taxes | — | 19 | — | — | 19 | |||||||||||||||
Defined benefit plans, net of $30 income tax benefit | — | — | (49 | ) | — | (49 | ) | |||||||||||||
Change in fair value of derivative instruments, net of $10 of income taxes | — | — | — | 18 | 18 | |||||||||||||||
Balances at December 31, 2006 | 16 | 49 | (67 | ) | 18 | 16 | ||||||||||||||
Unrealized gains on available-for-sale securities, net of $1 of income taxes | 3 | — | — | — | 3 | |||||||||||||||
Foreign currency translation adjustments, net of $3 income tax benefit | — | (7 | ) | — | — | (7 | ) | |||||||||||||
Gains reclassified into earnings from other comprehensive income, net of $3 and $5, respectively, of income taxes | (5 | ) | (8 | ) | — | — | (13 | ) | ||||||||||||
Defined benefit plans, net of $14 of income taxes | — | — | 23 | — | 23 | |||||||||||||||
Change in fair value of derivative instruments, net of $112 income tax benefit | — | — | — | (194 | ) | (194 | ) | |||||||||||||
Balances at December 31, 2007 | $ | 14 | $ | 34 | $ | (44 | ) | $ | (176 | ) | $ | (172 | ) | |||||||
F-32
F-34
NOTE 15 — | ACCRUED EXPENSES AND ALLOWANCE FOR DOUBTFUL ACCOUNTS |
2006 | 2005 | |||||||
Employee benefit plans | $ | 208 | $ | 203 | ||||
Taxes other than income | 168 | 166 | ||||||
Professional liability risks | 275 | 285 | ||||||
Interest | 228 | 149 | ||||||
Dividends | — | 62 | ||||||
Other | 314 | 399 | ||||||
$ | 1,193 | $ | 1,264 | |||||
2007 | 2006 | |||||||
Professional liability risks | $ | 280 | $ | 275 | ||||
Interest | 223 | 228 | ||||||
Employee benefit plans | 217 | 208 | ||||||
Income taxes | 190 | — | ||||||
Taxes other than income | 139 | 168 | ||||||
Other | 342 | 314 | ||||||
$ | 1,391 | $ | 1,193 | |||||
Provision | Accounts | ||||||||||||||||
Balance at | for | Written off, | Balance | ||||||||||||||
Beginning | Doubtful | Net of | at End | ||||||||||||||
of Year | Accounts | Recoveries | of Year | ||||||||||||||
Allowance for doubtful accounts: | |||||||||||||||||
Year ended December 31, 2004 | $ | 2,649 | $ | 2,669 | $ | (2,376 | ) | $ | 2,942 | ||||||||
Year ended December 31, 2005 | 2,942 | 2,358 | (2,403 | ) | 2,897 | ||||||||||||
Year ended December 31, 2006 | 2,897 | 2,660 | (2,129 | ) | 3,428 |
Provision | Accounts | |||||||||||||||
Balance at | for | Written off, | Balance | |||||||||||||
Beginning | Doubtful | Net of | at End | |||||||||||||
of Year | Accounts | Recoveries | of Year | |||||||||||||
Allowance for doubtful accounts: | ||||||||||||||||
Year ended December 31, 2005 | $ | 2,942 | $ | 2,358 | $ | (2,403 | ) | $ | 2,897 | |||||||
Year ended December 31, 2006 | 2,897 | 2,660 | (2,129 | ) | 3,428 | |||||||||||
Year ended December 31, 2007 | 3,428 | 3,130 | (2,269 | ) | 4,289 |
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION |
F-33
F-35
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
Revenues | $ | — | $ | 15,598 | $ | 11,260 | $ | — | $ | 26,858 | ||||||||||
Salaries and benefits | — | 6,441 | 4,273 | — | 10,714 | |||||||||||||||
Supplies | — | 2,549 | 1,846 | — | 4,395 | |||||||||||||||
Other operating expenses | (2 | ) | 2,279 | 1,964 | — | 4,241 | ||||||||||||||
Provision for doubtful accounts | — | 1,942 | 1,188 | — | 3,130 | |||||||||||||||
Gains on investments | — | — | (8 | ) | — | (8 | ) | |||||||||||||
Equity in earnings of affiliates | (2,245 | ) | (90 | ) | (116 | ) | 2,245 | (206 | ) | |||||||||||
Depreciation and amortization | — | 779 | 647 | — | 1,426 | |||||||||||||||
Interest expense | 2,161 | (95 | ) | 149 | — | 2,215 | ||||||||||||||
Gains on sales of facilities | — | (3 | ) | (468 | ) | — | (471 | ) | ||||||||||||
Impairment of long-lived assets | — | — | 24 | — | 24 | |||||||||||||||
Management fees | — | (392 | ) | 392 | — | — | ||||||||||||||
(86 | ) | 13,410 | 9,891 | 2,245 | 25,460 | |||||||||||||||
Income (loss) before minority interests and income taxes | 86 | 2,188 | 1,369 | (2,245 | ) | 1,398 | ||||||||||||||
Minority interests in earnings of consolidated entities | — | 28 | 180 | — | 208 | |||||||||||||||
Income (loss) before income taxes | 86 | 2,160 | 1,189 | (2,245 | ) | 1,190 | ||||||||||||||
Provision for income taxes | (788 | ) | 712 | 392 | — | 316 | ||||||||||||||
Net income (loss) | $ | 874 | $ | 1,448 | $ | 797 | $ | (2,245 | ) | $ | 874 | |||||||||
F-34
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
Revenues | $ | — | $ | 14,913 | $ | 10,564 | $ | — | $ | 25,477 | ||||||||||
Salaries and benefits | — | 6,319 | 4,090 | — | 10,409 | |||||||||||||||
Supplies | — | 2,487 | 1,835 | — | 4,322 | |||||||||||||||
Other operating expenses | — | 2,253 | 1,803 | — | 4,056 | |||||||||||||||
Provision for doubtful accounts | — | 1,652 | 1,008 | — | 2,660 | |||||||||||||||
Gains on investments | — | — | (243 | ) | — | (243 | ) | |||||||||||||
Equity in earnings of affiliates | (1,995 | ) | (79 | ) | (118 | ) | 1,995 | (197 | ) | |||||||||||
Depreciation and amortization | — | 755 | 636 | — | 1,391 | |||||||||||||||
Interest expense | 895 | (99 | ) | 159 | — | 955 | ||||||||||||||
Gains on sales of facilities | — | 7 | (212 | ) | — | (205 | ) | |||||||||||||
Impairment of long-lived assets | — | 5 | 19 | — | 24 | |||||||||||||||
Transaction costs | 429 | 25 | (12 | ) | — | 442 | ||||||||||||||
Management fees | — | (377 | ) | 377 | — | — | ||||||||||||||
(671 | ) | 12,948 | 9,342 | 1,995 | 23,614 | |||||||||||||||
Income (loss) before minority interests and income taxes | 671 | 1,965 | 1,222 | (1,995 | ) | 1,863 | ||||||||||||||
Minority interests in earnings of consolidated entities | — | 21 | 180 | — | 201 | |||||||||||||||
Income (loss) before income taxes | 671 | 1,944 | 1,042 | (1,995 | ) | 1,662 | ||||||||||||||
Provision for income taxes | (365 | ) | 612 | 379 | — | 626 | ||||||||||||||
Net income (loss) | $ | 1,036 | $ | 1,332 | $ | 663 | $ | (1,995 | ) | $ | 1,036 | |||||||||
F-35
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
Revenues | $ | — | $ | 14,254 | $ | 10,201 | $ | — | $ | 24,455 | ||||||||||
Salaries and benefits | — | 6,032 | 3,896 | — | 9,928 | |||||||||||||||
Supplies | — | 2,376 | 1,750 | — | 4,126 | |||||||||||||||
Other operating expenses | — | 2,234 | 1,800 | — | 4,034 | |||||||||||||||
Provision for doubtful accounts | — | 1,409 | 949 | — | 2,358 | |||||||||||||||
Gains on investments | — | 1 | (54 | ) | — | (53 | ) | |||||||||||||
Equity in earnings of affiliates | (1,792 | ) | (88 | ) | (133 | ) | 1,792 | (221 | ) | |||||||||||
Depreciation and amortization | — | 762 | 612 | — | 1,374 | |||||||||||||||
Interest expense | 593 | (70 | ) | 132 | — | 655 | ||||||||||||||
Gains on sales of facilities | — | (7 | ) | (71 | ) | — | (78 | ) | ||||||||||||
Management fees | — | (387 | ) | 387 | — | — | ||||||||||||||
(1,199 | ) | 12,262 | 9,268 | 1,792 | 22,123 | |||||||||||||||
Income (loss) before minority interests and income taxes | 1,199 | 1,992 | 933 | (1,792 | ) | 2,332 | ||||||||||||||
Minority interests in earnings of consolidated entities | — | 15 | 163 | — | 178 | |||||||||||||||
Income (loss) before income taxes | 1,199 | 1,977 | 770 | (1,792 | ) | 2,154 | ||||||||||||||
Provision for income taxes | (225 | ) | 711 | 244 | — | 730 | ||||||||||||||
Net income (loss) | $ | 1,424 | $ | 1,266 | $ | 526 | $ | (1,792 | ) | $ | 1,424 | |||||||||
F-36
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | 165 | $ | 228 | $ | — | $ | 393 | ||||||||||
Accounts receivable, net | — | 2,248 | 1,647 | — | 3,895 | |||||||||||||||
Inventories | — | 432 | 278 | — | 710 | |||||||||||||||
Deferred income taxes | 592 | — | — | — | 592 | |||||||||||||||
Other | — | 123 | 492 | — | 615 | |||||||||||||||
592 | 2,968 | 2,645 | — | 6,205 | ||||||||||||||||
Property and equipment, net | — | 6,960 | 4,482 | — | 11,442 | |||||||||||||||
Investments of insurance subsidiary | — | — | 1,669 | — | 1,669 | |||||||||||||||
Investments in and advances to affiliates | — | 221 | 467 | — | 688 | |||||||||||||||
Goodwill | — | 1,644 | 985 | — | 2,629 | |||||||||||||||
Deferred loan costs | 539 | — | — | — | 539 | |||||||||||||||
Investments in and advances to subsidiaries | 17,190 | — | — | (17,190 | ) | — | ||||||||||||||
Other | 798 | 18 | 37 | — | 853 | |||||||||||||||
$ | 19,119 | $ | 11,811 | $ | 10,285 | $ | (17,190 | ) | $ | 24,025 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | ||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||
Accounts payable | $ | — | $ | 883 | $ | 487 | $ | — | $ | 1,370 | ||||||||||
Accrued salaries | — | 515 | 265 | — | 780 | |||||||||||||||
Other accrued expenses | 411 | 372 | 608 | — | 1,391 | |||||||||||||||
Long-term debt due within one year | 271 | — | 37 | — | 308 | |||||||||||||||
682 | 1,770 | 1,397 | — | 3,849 | ||||||||||||||||
Long-term debt | 26,439 | 103 | 458 | — | 27,000 | |||||||||||||||
Intercompany balances | 1,368 | (6,524 | ) | 5,156 | — | — | ||||||||||||||
Professional liability risks | — | — | 1,233 | — | 1,233 | |||||||||||||||
Income taxes and other liabilities | 1,004 | 238 | 137 | — | 1,379 | |||||||||||||||
Minority interests in equity of consolidated entities | — | 117 | 821 | — | 938 | |||||||||||||||
29,493 | (4,296 | ) | 9,202 | — | 34,399 | |||||||||||||||
Equity securities with contingent redemption rights | 164 | — | — | — | 164 | |||||||||||||||
Stockholders’ (deficit) equity | (10,538 | ) | 16,107 | 1,083 | (17,190 | ) | (10,538 | ) | ||||||||||||
$ | 19,119 | $ | 11,811 | $ | 10,285 | $ | (17,190 | ) | $ | 24,025 | ||||||||||
F-37
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
ASSETS | ||||||||||||||||||||
Current assets: | ||||||||||||||||||||
Cash and cash equivalents | $ | — | $ | 282 | $ | 352 | $ | — | $ | 634 | ||||||||||
Accounts receivable, net | — | 2,145 | 1,560 | — | 3,705 | |||||||||||||||
Inventories | — | 408 | 261 | — | 669 | |||||||||||||||
Deferred income taxes | 476 | — | — | — | 476 | |||||||||||||||
Other | 171 | 134 | 289 | — | 594 | |||||||||||||||
647 | 2,969 | 2,462 | — | 6,078 | ||||||||||||||||
Property and equipment, net | — | 7,130 | 4,539 | — | 11,669 | |||||||||||||||
Investments of insurance subsidiary | — | — | 1,886 | — | 1,886 | |||||||||||||||
Investments in and advances to affiliates | — | 227 | 452 | — | 679 | |||||||||||||||
Goodwill | — | 1,629 | 972 | — | 2,601 | |||||||||||||||
Deferred loan costs | 614 | — | — | — | 614 | |||||||||||||||
Investments in and advances to subsidiaries | 14,945 | — | — | (14,945 | ) | — | ||||||||||||||
Other | 69 | 22 | 57 | — | 148 | |||||||||||||||
$ | 16,275 | $ | 11,977 | $ | 10,368 | $ | (14,945 | ) | $ | 23,675 | ||||||||||
LIABILITIES AND STOCKHOLDERS’ (DEFICIT) EQUITY | ||||||||||||||||||||
Current liabilities: | ||||||||||||||||||||
Accounts payable | $ | — | $ | 1,052 | $ | 363 | $ | — | $ | 1,415 | ||||||||||
Accrued salaries | — | 442 | 233 | — | 675 | |||||||||||||||
Other accrued expenses | 228 | 345 | 620 | — | 1,193 | |||||||||||||||
Long-term debt due within one year | 254 | 4 | 35 | — | 293 | |||||||||||||||
482 | 1,843 | 1,251 | — | 3,576 | ||||||||||||||||
Long-term debt | 26,651 | 194 | 1,270 | — | 28,115 | |||||||||||||||
Intercompany balances | — | (5,289 | ) | 5,289 | — | — | ||||||||||||||
Professional liability risks | — | — | 1,309 | — | 1,309 | |||||||||||||||
Income taxes and other liabilities | 391 | 441 | 185 | — | 1,017 | |||||||||||||||
Minority interests in equity of consolidated entities | — | 129 | 778 | — | 907 | |||||||||||||||
27,524 | (2,682 | ) | 10,082 | — | 34,924 | |||||||||||||||
Equity securities with contingent redemption rights | 125 | — | — | — | 125 | |||||||||||||||
Stockholders’ (deficit) equity | (11,374 | ) | 14,659 | 286 | (14,945 | ) | (11,374 | ) | ||||||||||||
$ | 16,275 | $ | 11,977 | $ | 10,368 | $ | (14,945 | ) | $ | 23,675 | ||||||||||
F-38
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||
Net income | $ | 874 | $ | 1,448 | $ | 797 | $ | (2,245 | ) | $ | 874 | |||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||
Provision for doubtful accounts | — | 1,942 | 1,188 | — | 3,130 | |||||||||||||||
Depreciation and amortization | — | 779 | 647 | — | 1,426 | |||||||||||||||
Income taxes | (105 | ) | — | — | — | (105 | ) | |||||||||||||
Gains on sales of facilities | — | (3 | ) | (468 | ) | — | (471 | ) | ||||||||||||
Impairment of long-lived assets | — | — | 24 | — | 24 | |||||||||||||||
Equity in earnings of affiliates | (2,245 | ) | — | — | 2,245 | — | ||||||||||||||
Decrease in cash from operating assets and liabilities | (6 | ) | (2,127 | ) | (1,482 | ) | — | (3,615 | ) | |||||||||||
Change in minority interests | — | 16 | 24 | — | 40 | |||||||||||||||
Share-based compensation | 24 | — | — | — | 24 | |||||||||||||||
Other | 85 | 18 | (34 | ) | — | 69 | ||||||||||||||
Net cash provided by (used in) operating activities | (1,373 | ) | 2,073 | 696 | — | 1,396 | ||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchase of property and equipment | — | (640 | ) | (804 | ) | — | (1,444 | ) | ||||||||||||
Acquisition of hospitals and health care entities | — | (11 | ) | (21 | ) | — | (32 | ) | ||||||||||||
Disposal of hospitals and health care entities | — | 24 | 743 | — | 767 | |||||||||||||||
Change in investments | — | 3 | 204 | — | 207 | |||||||||||||||
Other | — | (8 | ) | 31 | — | 23 | ||||||||||||||
Net cash provided by (used in) investing activities | — | (632 | ) | 153 | — | (479 | ) | |||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Issuances of long-term debt | — | — | 24 | — | 24 | |||||||||||||||
Net change in revolving bank credit facility | (520 | ) | — | — | — | (520 | ) | |||||||||||||
Repayment of long-term debt | (255 | ) | (4 | ) | (491 | ) | — | (750 | ) | |||||||||||
Issuances of common stock | 100 | — | — | — | 100 | |||||||||||||||
Repurchases of common stock | (2 | ) | — | — | — | (2 | ) | |||||||||||||
Payment of debt issuance costs | (9 | ) | — | — | — | (9 | ) | |||||||||||||
Changes in intercompany balances with affiliates, net | 2,059 | (1,554 | ) | (505 | ) | — | — | |||||||||||||
Other | — | — | (1 | ) | — | (1 | ) | |||||||||||||
Net cash provided by (used in) financing activities | 1,373 | (1,558 | ) | (973 | ) | — | (1,158 | ) | ||||||||||||
Change in cash and cash equivalents | — | (117 | ) | (124 | ) | — | (241 | ) | ||||||||||||
Cash and cash equivalents at beginning of period | — | 282 | 352 | — | 634 | |||||||||||||||
Cash and cash equivalents at end of period | $ | — | $ | 165 | $ | 228 | $ | — | $ | 393 | ||||||||||
F-39
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||
Net income | $ | 1,036 | $ | 1,332 | $ | 663 | $ | (1,995 | ) | $ | 1,036 | |||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||
Provision for doubtful accounts | — | 1,652 | 1,008 | — | 2,660 | |||||||||||||||
Depreciation and amortization | — | 755 | 636 | — | 1,391 | |||||||||||||||
Income taxes | (552 | ) | — | — | — | (552 | ) | |||||||||||||
Gains on sales of facilities | — | 7 | (212 | ) | — | (205 | ) | |||||||||||||
Impairment of long-lived assets | — | 5 | 19 | — | 24 | |||||||||||||||
Equity in earnings of affiliates | (1,995 | ) | — | — | 1,995 | — | ||||||||||||||
Increase (decrease) in cash from operating assets and liabilities | 78 | (1,552 | ) | (1,466 | ) | — | (2,940 | ) | ||||||||||||
Change in minority interests | — | 18 | 40 | — | 58 | |||||||||||||||
Share-based compensation | 324 | — | — | — | 324 | |||||||||||||||
Other | 74 | 2 | (27 | ) | — | 49 | ||||||||||||||
Net cash provided by (used in) operating activities | (1,035 | ) | 2,219 | 661 | — | 1,845 | ||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchase of property and equipment | — | (1,058 | ) | (807 | ) | — | (1,865 | ) | ||||||||||||
Acquisition of hospitals and health care entities | — | (29 | ) | (83 | ) | — | (112 | ) | ||||||||||||
Disposal of hospitals and health care entities | — | 108 | 543 | — | 651 | |||||||||||||||
Change in investments | — | 13 | 13 | — | 26 | |||||||||||||||
Other | — | (4 | ) | (3 | ) | — | (7 | ) | ||||||||||||
Net cash used in investing activities | — | (970 | ) | (337 | ) | — | (1,307 | ) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Issuances of long-term debt | 21,207 | — | 551 | — | 21,758 | |||||||||||||||
Net change in revolving bank credit facility | (435 | ) | — | — | — | (435 | ) | |||||||||||||
Repayment of long-term debt | (3,621 | ) | (3 | ) | (104 | ) | — | (3,728 | ) | |||||||||||
Issuances of common stock | 108 | — | — | — | 108 | |||||||||||||||
Repurchases of common stock | (653 | ) | — | — | — | (653 | ) | |||||||||||||
Recapitalization-repurchase of common stock | (20,364 | ) | — | — | — | (20,364 | ) | |||||||||||||
Recapitalization-equity contributions | 3,782 | — | — | — | 3,782 | |||||||||||||||
Payment of debt issuance costs | (586 | ) | — | — | — | (586 | ) | |||||||||||||
Payment of cash dividends | (201 | ) | — | — | — | (201 | ) | |||||||||||||
Changes in intercompany balances with affiliates, net | 1,719 | (1,095 | ) | (624 | ) | — | — | |||||||||||||
Other | 79 | — | — | — | 79 | |||||||||||||||
Net cash provided by (used in) financing activities | 1,035 | (1,098 | ) | (177 | ) | — | (240 | ) | ||||||||||||
Change in cash and cash equivalents | — | 151 | 147 | — | 298 | |||||||||||||||
Cash and cash equivalents at beginning of period | — | 131 | 205 | — | 336 | |||||||||||||||
Cash and cash equivalents at end of period | $ | — | $ | 282 | $ | 352 | $ | — | $ | 634 | ||||||||||
F-40
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
Subsidiary | ||||||||||||||||||||
Parent | Subsidiary | Non- | Condensed | |||||||||||||||||
Issuer | Guarantors | Guarantors | Eliminations | Consolidated | ||||||||||||||||
Cash flows from operating activities: | ||||||||||||||||||||
Net income | $ | 1,424 | $ | 1,266 | $ | 526 | $ | (1,792 | ) | $ | 1,424 | |||||||||
Adjustments to reconcile net income to net cash provided by (used in) operating activities: | ||||||||||||||||||||
Provision for doubtful accounts | — | 1,409 | 949 | — | 2,358 | |||||||||||||||
Depreciation and amortization | — | 762 | 612 | — | 1,374 | |||||||||||||||
Income taxes | 162 | — | — | — | 162 | |||||||||||||||
Gains on sales of facilities | — | (7 | ) | (71 | ) | — | (78 | ) | ||||||||||||
Equity in earnings of affiliates | (1,792 | ) | — | — | 1,792 | — | ||||||||||||||
Increase (decrease) in cash from operating assets and liabilities | 18 | (1,505 | ) | (791 | ) | — | (2,278 | ) | ||||||||||||
Change in minority interests | — | 4 | (17 | ) | — | (13 | ) | |||||||||||||
Share-based compensation | 30 | — | — | — | 30 | |||||||||||||||
Other | — | — | (8 | ) | — | (8 | ) | |||||||||||||
Net cash provided by (used in) operating activities | (158 | ) | 1,929 | 1,200 | — | 2,971 | ||||||||||||||
Cash flows from investing activities: | ||||||||||||||||||||
Purchase of property and equipment | — | (816 | ) | (776 | ) | — | (1,592 | ) | ||||||||||||
Acquisition of hospitals and health care entities | — | (33 | ) | (93 | ) | — | (126 | ) | ||||||||||||
Disposal of hospitals and health care entities | — | 141 | 179 | — | 320 | |||||||||||||||
Change in investments | — | 12 | (323 | ) | — | (311 | ) | |||||||||||||
Other | — | (4 | ) | 32 | — | 28 | ||||||||||||||
Net cash used in investing activities | — | (700 | ) | (981 | ) | — | (1,681 | ) | ||||||||||||
Cash flows from financing activities: | ||||||||||||||||||||
Issuances of long-term debt | 800 | — | 58 | — | 858 | |||||||||||||||
Net change in revolving bank credit facility | (225 | ) | — | — | — | (225 | ) | |||||||||||||
Repayment of long-term debt | (721 | ) | (2 | ) | (16 | ) | — | (739 | ) | |||||||||||
Issuances of common stock | 1,009 | — | — | — | 1,009 | |||||||||||||||
Repurchases of common stock | (1,856 | ) | — | — | — | (1,856 | ) | |||||||||||||
Payment of cash dividends | (258 | ) | — | — | — | (258 | ) | |||||||||||||
Changes in intercompany balances with affiliates, net | 1,410 | (1,166 | ) | (244 | ) | — | — | |||||||||||||
Other | (1 | ) | — | — | — | (1 | ) | |||||||||||||
Net cash provided by (used in) financing activities | 158 | (1,168 | ) | (202 | ) | — | (1,212 | ) | ||||||||||||
Change in cash and cash equivalents | — | 61 | 17 | — | 78 | |||||||||||||||
Cash and cash equivalents at beginning of period | — | 70 | 188 | — | 258 | |||||||||||||||
Cash and cash equivalents at end of period | $ | — | $ | 131 | $ | 205 | $ | — | $ | 336 | ||||||||||
F-41
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
2007 | 2006 | 2005 | ||||||||||
Presentation in HCA Inc. Consolidated Statements of Stockholders’ (Deficit) Equity: | ||||||||||||
Recapitalization-repurchase of common stock | $ | — | $ | (21,373 | ) | $ | — | |||||
Recapitalization-equity contribution | — | 4,477 | — | |||||||||
Cash dividends declared | — | (139 | ) | (257 | ) | |||||||
Stock repurchases | — | (653 | ) | (1,856 | ) | |||||||
Stock options exercised | — | 163 | 1,106 | |||||||||
Employee benefit plan issuances | — | 366 | 102 | |||||||||
Equity contributions | 60 | — | — | |||||||||
Share-based compensation | 24 | — | — | |||||||||
Other | 28 | — | — | |||||||||
Presentation in Healthtrust, Inc. — The Hospital Company Consolidated Statements of Stockholder’s (Deficit) Equity: | ||||||||||||
Distributions from (to) HCA Inc., net of contributions to (from) HCA Inc. | $ | 112 | $ | (17,159 | ) | $ | (905 | ) | ||||
F-42
NOTE 16 — | SUPPLEMENTAL CONDENSED CONSOLIDATING FINANCIAL INFORMATION AND OTHER COLLATERAL-RELATED INFORMATION (Continued) |
2007 | 2006 | 2005 | ||||||||||
Presentation in HCA Inc. Consolidated Statements of Cash Flows (cash flows from financing activities): | ||||||||||||
Issuances of common stock | $ | 100 | $ | 108 | $ | 1,009 | ||||||
Repurchases of common stock | (2 | ) | (653 | ) | (1,856 | ) | ||||||
Recapitalization-repurchase of common stock | — | (20,364 | ) | — | ||||||||
Recapitalization-equity contributions | — | 3,782 | — | |||||||||
Payment of cash dividends | — | (201 | ) | (258 | ) | |||||||
Presentation in Healthtrust Inc. — The Hospital Company Consolidated Statements of Cash Flows (cash flows from financing activities): | ||||||||||||
Net cash distributions from (to) HCA Inc. | $ | 98 | $ | (17,328 | ) | $ | (1,105 | ) | ||||
F-43
2006 | ||||||||||||||||
First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 6,415 | $ | 6,360 | $ | 6,213 | $ | 6,489 | ||||||||
Net income | $ | 379 | $ | 295 | (a) | $ | 240 | (b) | $ | 122 | (c) | |||||
Cash dividends declared per common share | $ | 0.17 | $ | 0.17 | $ | — | $ | — |
2005 | ||||||||||||||||
First | First | First | First | |||||||||||||
Revenues | $ | 6,182 | $ | 6,070 | $ | 6,025 | $ | 6,178 | ||||||||
Net income | $ | 414 | $ | 405 | (d) | $ | 280 | (e) | $ | 325 | (f) | |||||
Cash dividends declared per common share | $ | 0.15 | $ | 0.15 | $ | 0.15 | $ | 0.15 |
2007 | ||||||||||||||||
First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 6,677 | $ | 6,729 | $ | 6,569 | $ | 6,883 | ||||||||
Net income | $ | 180 | (a) | $ | 116 | (b) | $ | 300 | (c) | $ | 278 | (d) | ||||
2006 | ||||||||||||||||
First | Second | Third | Fourth | |||||||||||||
Revenues | $ | 6,415 | $ | 6,360 | $ | 6,213 | $ | 6,489 | ||||||||
Net income | $ | 379 | $ | 295 | (e) | $ | 240 | (f) | $ | 122 | (g) | |||||
Cash dividends declared per common share | $ | 0.17 | $ | 0.17 | $ | — | $ | — |
(a) | First quarter results include $2 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements). | |
(b) | Second quarter results include $7 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements) and $15 million of costs related to the impairment of long-lived assets (See NOTE 5 of the notes to consolidated financial statements). | |
(c) | Third quarter results include $193 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements). | |
(d) | Fourth quarter results include $88 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements). | |
(e) | Second quarter results include $4 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements). | |
Third quarter results include $25 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements) and $6 million of transaction costs related to the recapitalization (See NOTE 2 of the notes to consolidated financial statements). | ||
Fourth quarter results include $74 million of gains on sales of facilities (See NOTE 4 of the notes to consolidated financial statements), $303 million of transaction costs related to the recapitalization (See NOTE 2 of the notes to consolidated financial statements) and $15 million of costs related to the impairment of long-lived assets (See NOTE 5 of the notes to consolidated financial statements). | ||
F-44
F-36