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EXHIBIT 1.2
UNDERWRITING AGREEMENT
(TERMS)
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$500,000,000
7 7/8% Notes due 2011
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January 23, 2001
HCA - The Healthcare Company
One Park Plaza
Nashville, Tennessee 37203
Dear Sirs/Madams:
The underwriters set forth below (the "Underwriters"), for which Banc
of America Securities LLC and Merrill Lynch, Pierce, Fenner & Smith Incorporated
are acting as Managers (the "Managers"), understand that HCA - The Healthcare
Company (f/k/a Columbia/HCA Healthcare Corporation), a Delaware corporation (the
"Company"), proposes to issue and sell $500,000,000 aggregate principal amount
of its 7 7/8% Notes due February 1, 2011 (the "Offered Securities"). The Offered
Securities will be issued pursuant to the provisions of an Indenture dated as of
December 16, 1993, as supplemented (the "Indenture"), between the Company and
Bank One Trust Company, N.A. (f/k/a The First National Bank of Chicago), as
trustee (the "Trustee").
Subject to the terms and conditions set forth or incorporated by
reference herein, the Company hereby agrees to sell and the Underwriters agree
to purchase, severally and not jointly, the respective principal amounts of the
Offered Securities set forth below opposite their names at a purchase price of
98.362% of the principal amount of the Offered Securities.
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Principal Amount
of
Offered Securities
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Banc of America Securities LLC........................... $ 175,000,000
Merrill Lynch, Pierce, Fenner & Smith Incorporated....... 175,000,000
Chase Securities Inc..................................... 20,000,000
Goldman, Sachs & Co...................................... 20,000,000
Salomon Smith Barney Inc................................. 20,000,000
TD Securities (USA) Inc.................................. 20,000,000
Banc One Capital Markets, Inc............................ 10,000,000
BNY Capital Markets, Inc................................. 10,000,000
Fleet Securities, Inc.................................... 10,000,000
McDonald Investments Inc................................. 10,000,000
Scotia Capital (USA) Inc................................. 10,000,000
SunTrust Equitable Securities Corporation................ 10,000,000
Wachovia Securities, Inc................................. 10,000,000
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Total........................................... $ 500,000,000
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The Underwriters will pay for the Offered Securities upon delivery
thereof at the offices of Banc of America Securities LLC or through the
facilities of the Depository Trust Company at 10:00 a.m. (New York time) on
January 26, 2001 (the "Closing Date").
The Offered Securities shall have the terms set forth in the Prospectus
dated December 19, 2000, and the Prospectus Supplement dated January 23, 2001,
including the following:
Public Offering Price: 99.487% of principal amount
Purchase Price: 98.362% of principal amount
Maturity Date: February 1, 2011
Interest Rate: 7 7/8%
Redemption Provisions: The Company may, at its option, redeem
the Offered Securities at any time at the
price described in the Prospectus
Supplement.
Interest Payment Dates: February 1 and August 1 of each year,
commencing August 1, 2001. Interest
accrues from the settlement date.
Current Ratings: Standard & Poor's Ratings Service -- BB+
Moody's Investors Service, Inc. -- Ba2
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All provisions contained in the document entitled Underwriting
Agreement Standard Provisions (Debt Securities), a copy of which is attached
hereto, are incorporated by reference in their entirety herein and shall be
deemed to be a part of this Agreement to the same extent as if such provisions
had been set forth in full herein, except that (i) if any term defined in such
document is otherwise defined herein, the definition set forth herein shall
control, (ii) all references in such document to a type of security that is not
an Offered Security shall not be deemed to be a part of this Agreement, and
(iii) all references in such document to a type of agreement that has not been
entered into in connection with the transactions contemplated hereby shall not
be deemed to be a part of this Agreement.
As evidenced by the Company's countersignature of this Agreement, the
Company hereby confirms its engagement of the services of Goldman, Sachs & Co.
as, and Goldman, Sachs & Co. hereby confirms its agreement with the Company to
render services as, a "qualified independent underwriter," within the meaning of
Section (b)(15) of Rule 2720 of the Conduct Rules of the National Association of
Securities Dealers, Inc., with respect to the offering and sale of the Offered
Securities. As compensation for the services of Goldman, Sachs & Co. hereunder
as a "qualified independent underwriter," the Company agrees to pay Goldman,
Sachs & Co. $1,000 on the Closing Date. In addition, the Company agrees promptly
to reimburse Goldman, Sachs & Co. for all out-of-pocket expenses, including fees
and disbursements of counsel, reasonably incurred in connection with the
services to be rendered hereunder as a "qualified independent underwriter."
Goldman, Sachs & Co. hereby represents and warrants to, and agrees
with, the Company and the Underwriters that with respect to the offering and
sale of the Offered Securities as described in the Prospectus and Prospectus
Supplement:
(i) Goldman, Sachs & Co. constitutes a "qualified independent
underwriter" within the meaning of Section (b)(15) of Rule
2720 of the Conduct Rules of the National Association of
Securities Dealers, Inc.;
(ii) Goldman, Sachs & Co. has participated in the preparation of
the Registration Statement, the Prospectus and the Prospectus
Supplement and has exercised the usual standards of "due
diligence" in respect thereto;
(iii) Goldman, Sachs & Co. has undertaken the legal responsibilities
and liabilities of an underwriter under the Securities Act of
1933, as amended, specifically including those inherent in
Section 11 thereof;
(iv) Based upon (A) a review of the Company, including an
examination of the Registration Statement, information
regarding the earnings, assets, capital structure and growth
rate of the Company and other pertinent financial and
statistical data, (B) inquiries of and conferences with the
management of the Company and its counsel and independent
public accountants regarding the business and operations of
the Company, (C) consideration of the prospects for the
industry in which the Company competes, estimates of the
business potential of the Company, assessments
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of its management, the general condition of the securities
markets, market prices of the capital stock and debt
securities of, and financial and operating data concerning,
companies believed by Goldman, Sachs & Co. to be comparable
to the Company with debt securities of maturity and
seniority similar to the Offered Securities and the demand
for securities of comparable companies similar to the
Offered Securities, and (D) such other studies, analyses and
investigations as Goldman, Sachs & Co. has deemed
appropriate, and assuming that the offering and sale of the
Offered Securities is made as contemplated herein and in the
Prospectus and Prospectus Supplement, Goldman, Sachs & Co.
recommends, as of the date of the execution and delivery of
this Agreement, that the yield on the Offered Securities be
not less than 7 7/8%, which minimum yield should in no way
be considered or relied upon as an indication of the value
of the Offered Securities; and
(v) Goldman, Sachs & Co. will furnish to the Underwriters at the
time of delivery of the Offered Securities a letter, dated
the time of delivery of the Offered Securities, in form and
substance satisfactory to the Underwriters, to the effect of
clauses (i) through (iv) above.
Goldman, Sachs & Co. hereby agrees with the Company and the
Underwriters that, as part of its services hereunder, in the event of any
amendment or supplement to either the Prospectus or the Prospectus Supplement,
Goldman, Sachs & Co. will render services as a "qualified independent
underwriter," in accordance with Rule 2710 of the Conduct Rules of the National
Association of Securities Dealers, Inc., as such term is defined in Section
(b)(15) of Rule 2720 of the Conduct Rules of the National Association of
Securities Dealers, Inc. with respect to the offering and sale of the Offered
Securities as described in either the Prospectus or the Prospectus Supplement,
as so amended or supplemented, that are substantially the same as those services
being rendered with respect to the offering and sale of the Offered Securities
as described in the Prospectus and the Prospectus Supplement (including those
described above).
In addition, the Company agrees with Goldman Sachs & Co. that the
indemnification and contribution provisions of the Underwriting Agreement
Standard Provisions (Debt Securities), which are incorporated herein by
reference, shall also apply to Goldman Sachs & Co. in its capacity as qualified
independent underwriter. The Company agrees to cooperate with Goldman, Sachs &
Co. to enable it to perform the services contemplated by this Agreement.
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Please confirm your agreement by having an authorized officer sign a
copy of this Underwriting Agreement in the space set forth below.
Very truly yours,
Banc of America Securities LLC
Acting on behalf of itself
and the several Underwriters named herein
By: /s/ Lily Chang
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Name: Lily Chang
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Title: Principal
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By: Goldman, Sachs & Co.
/s/ Goldman, Sachs & Co.
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(Goldman, Sachs & Co.)
Accepted:
HCA - The Healthcare Company
By: /s/ David G. Anderson
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Name: David G. Anderson
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Title: Senior Vice President -- Finance and Treasurer
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