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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported)
April 16, 1997
QUORUM HEALTH GROUP, INC.
(Exact name of registrant as specified in its charter)
Delaware 62-1406040
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification
incorporation) Number)
103 Continental Place, Brentwood, Tennessee 37027
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(Address of principal executive offices)
(615) 371-7979
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year,
if changed since last report)
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ITEM 5. OTHER EVENTS.
On April 16, 1997, the Board of Directors of Quorum Health
Group, Inc. (the "Company") declared a distribution of one common share
purchase right (a "Right") for each outstanding share of common stock, $.01 par
value (the "Common Shares"), of the Company. The distribution is payable on
April 28, 1997 to the stockholders of record on that date. As of February 6,
1997, 48,966,421 Common Shares were issued and outstanding. Each Right
entitles the registered holder, subject to the terms of the Rights Agreement,
to purchase from the Company one-third (1/3) of a Common Share of the Company
at a price of $150.00 per one-third of a Common Share (the "Purchase Price")
under certain circumstances and subject to adjustment. The description and
terms of the Rights are set forth in a Rights Agreement (the "Rights
Agreement") dated April 16, 1997 between the Company and First Union National
Bank of North Carolina, as Rights Agent (the "Rights Agent").
Initially, the Rights will attach to all Common Share
certificates representing outstanding shares and no separate Right Certificate
(defined below) will be distributed. The Rights will separate from the Common
Shares and a Distribution Date will occur upon the earlier of (i) ten days
following a public announcement that a person or group of affiliated or
associated persons (an "Acquiring Person") has acquired beneficial ownership of
15% or more of the outstanding Voting Shares (as defined in the Rights
Agreement) of the Company, and (ii) ten business days following the
commencement or announcement of an intention to commence a tender offer or
exchange offer (other than the Company, any subsidiary of the Company, any
employee benefit plan of the Company or of any subsidiary of the Company, or
any Trustee of or fiduciary with respect to any such plan when acting in such
capacity) the consummation of which would result in the beneficial ownership by
a person or group of 15% or more of such outstanding Voting Shares.
Until the Distribution Date (or earlier redemption or
expiration of the Rights) (i) the Rights will be evidenced, with respect to any
of the Common Shares outstanding on April 28, 1997, by certificates for
outstanding Common Shares and not by separate certificates evidencing the
Rights, (ii) the Rights will be transferred with and only with the Common
Shares, (iii) new Common Share certificates issued after April 28, 1997, upon
transfer or new issuance of the Common Shares, will contain a notation
incorporating the Rights Agreement by reference, and (iv) the surrender for
transfer of any certificates for Common Shares outstanding as of April 28, 1997
will also constitute the transfer of the Rights associated with the Common
Shares represented by such certificates.
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As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights (the "Right Certificates") will be
mailed to holders of record of the Common Shares as of the close of business on
the Distribution Date and such separate Right Certificates alone will
thereafter evidence the Rights.
The Rights are not exercisable until the Distribution Date.
The Rights will expire on the close of business on the tenth anniversary of the
Rights Agreement (the "Final Expiration Date"), unless the Final Expiration
Date is changed or the Rights are earlier redeemed or exchanged by the Company
as described below.
Subject to action of the Board of Directors of the Company
pursuant to Section 25 of the Rights Agreement, if a person or group were to
acquire 15% or more of the Voting Shares of the Company, each holder of a Right
then outstanding (other than Rights beneficially owned by the Acquiring Person
which would become null and void) shall thereafter have a right to receive,
upon exercise thereof at a price equal to the then current Purchase Price
multiplied by the number of one-thirds of a Common Share for which a Right is
then exercisable, such number of Common Shares of the Company as shall equal
the result obtained by (x) multiplying the then current Purchase Price by the
number of one- thirds of a Common Share for which a Right is then exercisable
and dividing that by (y) 50% of the then current per share market price of the
Company's Common Shares on the date such person became an Acquiring Person.
If the Company were acquired in a merger or other business
combination transaction or more than 50% of its consolidated assets or earning
power were sold, proper provision will be made so that each holder of a Right
will thereafter have the right to receive, upon the exercise thereof at the
then current Purchase Price of the Right, that number of shares of common stock
of the acquiring company which at the time of such transaction would have a
market value of two times the Purchase Price of the Right.
The number of Common Shares or other securities or property
issuable upon exercise of the Rights, and the Purchase Price payable, are
subject to customary adjustments from time to time to prevent dilution.
The number of outstanding Rights and the number of Common
Shares issuable upon exercise of each Right are also subject to adjustment in
the event of a stock split of the Common Shares or a stock dividend on the
Common Shares payable in Common Shares or subdivisions, consolidations or
combinations of the Common Shares occurring, in any such case, prior to the
Distribution Date.
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At any time after the acquisition by a person or group of
affiliated or associated persons of beneficial ownership of 15% or more of the
outstanding Voting Shares of the Company and before the acquisition by a person
or group of 50% or more of the outstanding Voting Shares of the Company, the
Board of Directors may, at its option, issue Common Shares in mandatory
redemption of, or in exchange for, all or part of the then outstanding and
exercisable Rights (other than Rights owned by such Acquiring Person or group
which would become null and void) at an exchange ratio of one Common Share for
each two Common Shares for which each Right is then exercisable, subject to
adjustment.
At any time prior to the tenth business day after the first
public announcement that a person or group has become the beneficial owner of
15% or more of the outstanding Voting Shares, the Board of Directors of the
Company may redeem all, but not less than all, of the then outstanding Rights
at a price of $.01 per Right (the "Redemption Price"). The redemption of the
Rights may be made effective at such time, on such basis and with such
conditions as the Board of Directors in its sole discretion may establish.
Immediately upon the action of the Board of Directors ordering redemption of
the Rights, the right to exercise the rights will terminate and the only right
of the holders of Rights will be to receive the Redemption Price.
Until a Right is exercised, the holder thereof, as such, will
have no rights as a stockholder of the Company, including, without limitation,
the right to vote or to receive dividends.
The terms of the Rights may be amended by the Board of
Directors of the Company without the consent of the holders of the Rights,
including an amendment to change the Final Expiration Date, and, provided a
Distribution Date has not occurred, to extend the period during which the
Rights may be redeemed, except that after the Distribution Date no such
amendment may materially and adversely affect the interests of the holders of
the Rights.
The Rights Agreement between the Company and the Rights Agent,
specifying the terms of the Rights, including the form of Right Certificate,
the form of the Summary of Rights to Purchase Common Shares and the specimen of
the legend to be placed on new Common Share certificates, is attached hereto as
Exhibit 4 and is incorporated herein by reference. The foregoing description
of the Rights does not purport to be complete and is qualified in its entirety
by reference to such Exhibit 4.
On April 16, 1997, the Board of Directors of the Company also
adopted the following amendments to the Company's By-laws:
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(A) Article II, Section 2 of the Company's By-laws were
amended by replacing said Section 2 of the By-laws with the following
provision:
"SECTION 2. Annual Meetings. (a) The annual meetings of
stockholders shall be held on such dates and at such time as shall be
designated from time to time by the Board of Directors and stated in
the notice of the meeting, at which meetings the stockholders shall
elect by a plurality vote a Board of Directors, and transact such
other business as may properly be brought before the meeting. Written
notice of the annual meeting stating the place, date and hour of the
meeting shall be given to each stockholder entitled to vote at such
meeting not less than ten nor more than sixty days before the date of
the meeting.
(b) At an annual meeting of stockholders, only such
business shall be conducted, and only such proposals shall be acted
upon, as shall have been properly brought before the annual meeting of
stockholders (a) by, or at the direction of, the Board of Directors or
(b) by a stockholder of the Corporation who complies with the
procedures set forth in this Section 2(b). For business or a proposal
to be properly brought before an annual meeting of stockholders by a
stockholder, the stockholder must have given timely notice thereof in
writing to the Secretary of the Corporation. To be timely, a
stockholder's notice must be delivered to or mailed and received at
the principal executive offices of the Corporation not less than 60
days nor more than 90 days prior to the scheduled date of the annual
meeting, regardless of any postponement, deferral or adjournment of
that meeting to a later date; provided, however, that if less than 70
days' notice or prior public disclosure of the date of the annual
meeting is given or made to stockholders, notice by the stockholder to
be timely must be so delivered or received not later than the close of
business on the 10th day following the earlier of (i) the day on which
such notice of the date of the meeting was mailed or (ii) the day on
which such public disclosure was made.
A stockholder's notice to the Secretary shall set forth as to
each matter the stockholder proposes to bring before an annual meeting
of stockholders (i) a description of the business desired to be
brought before the annual meeting and the reasons for conducting such
business at the annual meeting, (ii) the name and address, as they
appear on the Corporation's books, of the stockholder proposing such
business and any other stockholders known by such stockholder to be
supporting such proposal, (iii) the class and number of shares of the
Corporation which are beneficially owned by such stockholder on the
date of such stockholder's notice and by any other stockholders known
by such stock-
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holder to be supporting such proposal on the date of such
stockholder's notice, (iv) a description, in 500 words or less, of any
interest of the stockholder in such proposal and (v) a representation
that the stockholder is a holder of record of stock of the Corporation
and intends to appear in person or by proxy at the meeting to present
the proposal specified in the notice. Notwithstanding anything in
these By-Laws to the contrary, no business shall be conducted at a
meeting of stockholders except in accordance with the procedures set
forth in this Section 2(b).
(c) Only persons nominated in accordance with the
procedures set forth in this Section 2(c) shall be eligible for
election as directors. Nominations of persons for election to the
Board may be made at an annual meeting of stockholders or special
meeting of stockholders called by the Board of Directors for the
purpose of electing directors (i) by or at the direction of the Board
or (ii) by any stockholder of the Corporation entitled to vote for the
election of directors at such meeting who complies with the notice
procedures set forth in this Section 2(c). Such nominations, other
than those made by or at the direction of the Board, shall be made
pursuant to timely notice in writing to the Secretary of the
Corporation. To be timely, a stockholder's notice must be delivered
to or mailed and received at the principal executive offices of the
Corporation not less than 60 days nor more than 90 days prior to the
scheduled date of the meeting, regardless of any postponement,
deferral or adjournment of that meeting to a later date; provided,
however, that if less than 70 days' notice or prior public disclosure
of the date of the meeting is given or made to stockholders, notice by
the stockholder to be timely must be so delivered or received not
later than the close of business on the 10th day following the earlier
of (i) the day on which such notice of the date of the meeting was
mailed or (ii) the day on which such public disclosure was made.
A stockholder's notice to the Secretary shall set forth (i) as
to each person whom the stockholder proposes to nominate for election
or reelection as a director (a) the name, age, business address and
residence address of such person, (b) the principal occupation or
employment of such person, (c) the class and number of shares of the
Corporation which are beneficially owned by such person on the date of
such stockholder's notice and (d) any other information relating to
such person that is required to be disclosed in solicitations of
proxies for election of directors, or is otherwise required, in each
case pursuant to Regulation 14A under the Securities Exchange Act of
1934, as amended, or any successor statute thereto (including without
limitation such person's written consent to being named in the proxy
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statement as a nominee and to serving as a director if elected); (ii)
as to the stockholder giving the notice (a) the name and address, as
they appear on the Corporation's books, of such stockholder and any
other stockholders known by such stockholder to be supporting such
nominee(s), (b) the class and number of shares of the Corporation
which are beneficially owned by such stockholder on the date of such
stockholder's notice and by any other stockholders known by such
stockholder to be supporting such nominee(s) on the date of such
stockholder's notice, (c) a representation that the stockholder is a
holder of record of stock of the Corporation entitled to vote at
such meeting and intends to appear in person or by proxy at the
meeting to nominate the person or persons specified in the notice; and
(iii) a description of all arrangements or understandings between the
stockholder and each nominee and other person or persons (naming such
person or persons) pursuant to which the nomination or nominations are
to be made by the stockholder. No person shall be eligible for
election as a director of the Corporation unless nominated in
accordance with the procedures set forth in this Section 2(c)."
(B) Article II, Section 3 of the Company's By-laws were
amended by replacing said Section 3 of the By-laws with the following
provision:
"SECTION 3. Special Meeting. Special meetings of
stockholders, unless otherwise prescribed by statute, may be called at
any time only by the Board of Directors, the Chairman of the Board or
the Chief Executive Officer. Except as otherwise expressly required
by statute, written notice of each special meeting of stockholders
stating the date, place and hour of the meeting, and the purpose or
purposes for which the meeting is called, shall be given to each
stockholder of record entitled to vote thereat not less than ten nor
more than sixty days before the date of the meeting. Business
transacted at any special meeting of stockholders shall be limited to
the purposes stated in the notice."
ITEM 7. FINANCIAL STATEMENTS AND EXHIBITS
Exhibit 3(ii) Amendments to By-Laws of Quorum Health Group, Inc.
Exhibit 4 Form of Rights Agreement dated as of April
16, 1997, between Quorum Health Group, Inc.
and First Union National Bank of North
Carolina, including the form of Rights
Certificate as Exhibit A and the form of
Summary of Rights to Purchase Common Shares
as Exhibit B. Pursuant to the Rights
Agreement, printed
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Right Certificates will not be delivered until as
soon as practicable after the Distribution Date.
Exhibit 21(a) Press Release dated April 17, 1997.
Exhibit 21(b) Form of Letter to Stockholders of Quorum Health
Group, Inc. regarding the adoption of the Rights Plan
pursuant to the Rights Agreement.
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this Report to be signed on its behalf by
the undersigned thereunto duly authorized.
QUORUM HEALTH GROUP, INC.
By: /s/ James E. Dalton, Jr.
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James E. Dalton, Jr.
President
Date: April 17, 1997
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