Obligation Communal Health Systems 6.25% ( US12543DAY67 ) en USD

Communal Health Systems

100 % ▼

Etas-Unis

US12543DAY67 ( en USD )

6.25% par an ( paiement semestriel )

31/03/2023 - Obligation échue

Prospectus brochure de l'obligation Community Health Systems (CHS) US12543DAY67 en USD 6.25%, échue

1 000 USD

3 100 000 000 USD

12543DAY6

B- ( Très spéculatif )

Caa2 ( Ultra spéculatif )

Community Health Systems (CHS) est une société américaine de soins de santé qui exploite un vaste réseau d'hôpitaux communautaires et d'autres installations de soins de santé dans plusieurs États des États-Unis.

Un examen approfondi de l'obligation de type US12543DAY67 (CUSIP: 12543DAY6) émise par Community Health Systems (CHS), une entité basée aux États-Unis opérant dans le secteur de la santé en gérant un réseau étendu d'hôpitaux et de services connexes, révèle des informations clés sur cet instrument de dette. Cette obligation, émise en USD, affichait un taux d'intérêt nominal de 6,25% et représentait une taille totale d'émission substantielle de 3,1 milliards USD, avec une taille minimale d'achat fixée à 1 000 USD. Négociée à 100% de son prix nominal sur le marché, elle est arrivée à maturité le 31 mars 2023 et a été entièrement remboursée à cette date, ayant effectué des paiements d'intérêts semi-annuels. Avant son remboursement, elle était notée B- par l'agence de notation Standard & Poor's (S&P) et Caa2 par l'agence de notation Moody's, des classifications reflétant sa position dans la catégorie spéculative du marché obligataire.

Form 424(b)(5)
424B5 1 d367159d424b5.htm FORM 424(B)(5)
Table of Contents
Filed Pursuant to Rule 424(b)(5)
Registration No. 333-203918
CALCULATION OF REGISTRATION FEE

Title of Each Class of
Amount to be
Maximum Aggregate
Amount of
Securities to be Registered

Registered

Offering Price
Registration Fee(1)
6.250% Senior Secured Notes due 2023
$2,200,000,000 $2,200,000,000
$254,980
Guarantees of 6.250% Senior Secured Notes due 2023

--(2)

(1)
Calculated in accordance with Rule 457(r) under the Securities Act of 1933, as amended.
(2)
Pursuant to Rule 457(n), no separate fee is payable with respect to the guarantees.
Table of Contents
Filed Pursuant to Rule 424(b)(5)
Registration No. 333-203918

$2,200,000,000

CH S/Com m unit y H e a lt h Syst e m s, I nc .
6.250% Senior Secured Notes due 2023
We are offering $2,200,000,000 aggregate principal amount of 6.250% Senior Secured Notes due 2023 (the "notes").
We will pay interest on the notes semi-annually on each March 31 and September 30, commencing on September 30, 2017. The notes will
mature on March 31, 2023.
We may redeem some or all of the notes at any time prior to March 31, 2020 at a price equal to 100% of the principal amount of the notes
redeemed plus accrued and unpaid interest, if any, plus a "make-whole" premium, as described in this prospectus supplement. We may redeem
some or all of the notes at any time on or after March 31, 2020 at the redemption prices set forth in this prospectus supplement, plus accrued
and unpaid interest, if any. In addition, we may redeem up to 40% of the aggregate principal amount of the notes at any time prior to March 31,
2020 using the net proceeds from certain equity offerings at the redemption price set forth in this prospectus supplement, plus accrued and
unpaid interest, if any. There is no sinking fund for the notes.
The notes will be our senior secured obligations and will rank equal in right of payment to all of our existing and future senior indebtedness
that is not subordinated in right of payment to the notes, will be senior in right of payment to any indebtedness that is subordinated in right of
payment to the notes and will be effectively senior to all of our existing and future unsecured indebtedness to the extent of the value of the
assets securing the notes. The notes will be guaranteed on a senior secured basis by our parent and certain of our domestic subsidiaries. These
guarantees will rank equal in right of payment to all of the existing and future indebtedness of each guarantor that is not subordinated in right of
payment to its guarantee of the notes, will be senior in right of payment to any indebtedness of each guarantor that is subordinated in right of
payment to its guarantee of the notes and will be effectively senior to all of the existing and future unsecured indebtedness of each guarantor to
the extent of the value of the assets securing its guarantee of the notes. The notes and the guarantees of the notes will be secured by liens on
certain assets that also secure our existing senior secured credit facilities (the "Credit Facility"), our 5.125% Senior Secured Notes due 2021 (the
"2021 Secured Notes") and, for so long as they are outstanding, our 5.125% Senior Secured Notes due 2018 (the "2018 Secured Notes"),
subject to certain exceptions. The notes and related guarantees will be structurally junior in right of payment to liabilities of our subsidiaries that
will not guarantee the notes.
We do not intend to apply for listing of the notes on any securities exchange.
I nve st ing in t he not e s involve s risk s. Se e "Risk Fa c t ors" be ginning on pa ge S-2 5 of t his prospe c t us supple m e nt .
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Form 424(b)(5)
N e it he r t he Se c urit ie s a nd Ex c ha nge Com m ission nor a ny st a t e se c urit ie s c om m ission ha s a pprove d or
disa pprove d of t he se se c urit ie s or de t e rm ine d if t his prospe c t us supple m e nt or t he a c c om pa nying prospe c t us is
t rut hful or c om ple t e . Any re pre se nt a t ion t o t he c ont ra ry is a c rim ina l offe nse .

Pe r N ot e

T ot a l
Public offering price(1)

100.000%

$2,200,000,000
Underwriting discount

1.550%

$ 34,100,000
Proceeds to us (before expenses)(1)

98.450%

$2,165,900,000

(1) Plus accrued interest, if any, from March 16, 2017.
Delivery of the notes in book-entry form will be made on or about March 16, 2017.
J oint Book -Running M a na ge rs
Cre dit Suisse
BofA M e rrill Lync h
Cit igroup
Cre dit Agric ole CI B
Goldm a n, Sa c hs & Co.
J . P. M orga n
RBC Ca pit a l M a rk e t s
SunT rust Robinson
H um phre y

U BS I nve st m e nt Ba nk

We lls Fa rgo Se c urit ie s

Co-M a na ge rs

BBV A

De ut sc he Ba nk Se c urit ie s

Fift h T hird Se c urit ie s

M orga n

St a nle y

Re gions Se c urit ie s LLC

Sc ot ia ba nk
The date of this prospectus supplement is March 7, 2017.
Table of Contents

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Form 424(b)(5)
Table of Contents
TABLE OF CONTENTS
Prospectus Supplement

ABOUT THIS PROSPECTUS SUPPLEMENT

S-ii
INDUSTRY AND MARKET DATA

S-ii
FORWARD-LOOKING STATEMENTS

S-ii
SUMMARY

S-1
THE OFFERING

S-11
SUMMARY HISTORICAL FINANCIAL AND OTHER DATA

S-15
RISK FACTORS

S-25
PRINCIPAL STOCKHOLDERS

S-56
RATIO OF EARNINGS TO FIXED CHARGES

S-57
USE OF PROCEEDS

S-58
CAPITALIZATION

S-59
DESCRIPTION OF CERTAIN INDEBTEDNESS

S-61
DESCRIPTION OF THE NOTES

S-68
MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

S-157
UNDERWRITING

S-162
LEGAL MATTERS

S-168
EXPERTS

S-168
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

S-168
WHERE YOU CAN FIND ADDITIONAL INFORMATION

S-170

Prospectus

ABOUT THIS PROSPECTUS

1
FORWARD-LOOKING STATEMENTS

1
WHERE YOU CAN FIND ADDITIONAL INFORMATION

3
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE

3
OUR COMPANY

4
RISK FACTORS

5
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Form 424(b)(5)
USE OF PROCEEDS

5
RATIO OF EARNINGS TO FIXED CHARGES

6
DESCRIPTION OF THE SECURITIES WE MAY ISSUE

7
DESCRIPTION OF THE DEBT SECURITIES AND GUARANTEES OF DEBT SECURITIES

11
DESCRIPTION OF THE CAPITAL STOCK

14
DESCRIPTION OF THE SECURITIES WARRANTS

20
PLAN OF DISTRIBUTION

21
LEGAL MATTERS

23
EXPERTS

23

You should rely only on the information contained or incorporated by reference in this prospectus supplement or accompanying
prospectus or in any free writing prospectus prepared by or on behalf of us or to which we have referred you. We have not authorized
anyone to provide you with information that is different. If you receive any such other information, it should not be relied upon as having
been authorized by us or the underwriters. This prospectus supplement and accompanying prospectus may only be used where it is legal to
sell these securities. The information in this prospectus supplement, the accompanying prospectus and the documents incorporated by
reference herein and therein may only be accurate as of the date of the document containing such information. You should not assume that
the information contained in this prospectus supplement, the accompanying prospectus and the documents incorporated by reference is
accurate as of any date other than the date of the document containing such information.
It is expected that delivery of the notes will be made against payment therefor on or about the date specified on the cover of this prospectus
supplement, which is the seventh business day following the date of pricing of the notes (such settlement cycle being referred to as "T+7"). You
should note that trading of the notes on the date of this prospectus supplement or the next three succeeding business days may be affected by the
T+7 settlement. See "Underwriting."

S-i
Table of Contents
ABOUT THIS PROSPECTUS SUPPLEMENT
This document is in two parts. The first part is this prospectus supplement, which adds, updates and changes information contained or
incorporated by reference in the accompanying prospectus. The second part is the accompanying prospectus, which gives more general
information, some of which may not apply to this offering of notes. If the information set forth in this prospectus supplement or any document
incorporated by reference herein varies in any way from the information set forth or incorporated by reference in the accompanying prospectus,
you should rely on the information contained in this prospectus supplement or any document incorporated by reference herein. If the information
set forth in this prospectus supplement varies in any way from the information set forth in a document incorporated by reference herein, you should
rely on the information in the more recent document.
We are not, and the underwriters are not, making an offer of these notes in any jurisdiction where the offer or sale is not permitted. Before
you invest in the notes, you should read the registration statement described in the accompanying prospectus (including the exhibits thereto) of
which this prospectus supplement and the accompanying prospectus form a part, as well as this prospectus supplement, the accompanying
prospectus and the documents incorporated by reference into this prospectus supplement and the accompanying prospectus. The documents
incorporated by reference herein are described in this prospectus supplement under "Incorporation of Certain Information by Reference." You
should not assume that the information contained in, or the documents incorporated by reference in, this prospectus supplement or the
accompanying prospectus are accurate as of any date other than their respective dates. Our business, financial condition, results of operations and
prospects may have changed since those dates.
INDUSTRY AND MARKET DATA
This prospectus supplement includes industry and trade association data, forecasts and information that we have prepared based, in part, upon
data, forecasts and information obtained from independent trade associations, industry and government publications and surveys and other
independent sources available to us. Some data also are based on our good faith estimates, which are derived from management's knowledge of the
industry and from independent sources. These third-party publications and surveys generally state that the information included therein has been
obtained from sources believed to be reliable. We have not independently verified any of the data from third-party sources. Similarly, we believe
our internal research is reliable, even though such research has not been verified by any independent sources. While we are not aware of any
misstatements regarding any such data, forecasts and information presented herein, you should carefully consider the inherent risks and
uncertainties associated with the industry and market data contained in this prospectus supplement.
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Form 424(b)(5)
FORWARD-LOOKING STATEMENTS
This prospectus supplement, the accompanying prospectus and any documents we incorporate by reference may contain "forward-looking
statements" within the meaning of the federal securities laws, which involve risks, assumptions and uncertainties. Statements that are predictive in
nature, that depend upon or refer to future events or conditions, or that include words such as "expects," "anticipates," "intends," "plans,"
"believes," "estimates," "thinks," and similar expressions are forward-looking statements. These statements involve known and unknown risks,
uncertainties and other factors relating to us or the healthcare industry generally that may cause our actual results and performance to be materially
different from any future results or performance expressed or implied by these forward-looking statements. These factors include, but are not
limited to, the following:

· general economic and business conditions, both nationally and in the regions in which we operate;

· the impact of the 2016 federal elections, which may lead to the repeal of the Patient Protection and Affordable Care Act, as amended by

the Health Care and Education Reconciliation Act of 2010 (collectively, the "Affordable Care Act") or significant changes to the
Affordable Care Act, its

S-ii
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implementation or its interpretation, as well as changes in other federal, state or local laws or regulations affecting our business;

· the extent to which states support increases, decreases or changes in Medicaid programs, implement health insurance exchanges or alter the

provision of healthcare to state residents through regulation or otherwise;

· the future and long-term viability of health insurance exchanges, which may be affected by whether a sufficient number of payors

participate as well as the impact of the 2016 federal elections on the Affordable Care Act;

· risks associated with our substantial indebtedness, leverage and debt service obligations, including our ability to refinance such

indebtedness on acceptable terms or to incur additional indebtedness;

· demographic changes;

· changes in, or the failure to comply with, governmental regulations;

· potential adverse impact of known and unknown government investigations, audits, and federal and state false claims act litigation and

other legal proceedings;

· our ability, where appropriate, to enter into and maintain provider arrangements with payors and the terms of these arrangements, which

may be further affected by the increasing consolidation of health insurers and managed care companies;

· changes in, or the failure to comply with, contract terms with payors and changes in reimbursement rates paid by federal or state healthcare

programs or commercial payors;

· any potential additional impairments in the carrying value of goodwill, other intangible assets, or other long-lived assets, or changes in the

useful lives of other intangible assets;

· changes in inpatient or outpatient Medicare and Medicaid payment levels;

· the effects related to the continued implementation of the sequestration spending reductions and the potential for future deficit reduction

legislation;

· increases in the amount and risk of collectability of patient accounts receivable, including decreases in collectability which may result

from, among other things, self-pay growth in states that have not expanded Medicaid and difficulties in recovering payments for which
patients are responsible, including co-pays and deductibles;

· the efforts of insurers, healthcare providers and others to contain healthcare costs, including the trend toward value-based purchasing;

· our ongoing ability to demonstrate meaningful use of certified electronic health record ("EHR") technology and recognize income for the

related Medicare or Medicaid incentive payments, to the extent such payments have not expired;

· increases in wages as a result of inflation or competition for highly technical positions and rising supply and drug costs due to market

pressure from pharmaceutical companies and new product releases;

· liabilities and other claims asserted against us, including self-insured malpractice claims;

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· competition;

· our ability to attract and retain, at reasonable employment costs, qualified personnel, key management, physicians, nurses and other

healthcare workers;

· trends toward treatment of patients in less acute or specialty healthcare settings, including ambulatory surgery centers or specialty

hospitals;

· changes in medical or other technology;

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· changes in U.S. GAAP;

· the availability and terms of capital to fund any additional acquisitions or replacement facilities or other capital expenditures;

· our ability to successfully make acquisitions or complete divestitures, including the divestiture of hospitals and non-hospital businesses
pursuant to our portfolio rationalization and deleveraging strategy, our ability to complete any such acquisitions or divestitures on desired

terms or at all (including to realize the anticipated amount of proceeds from contemplated divestitures), the timing of the completion of any
such acquisitions or divestitures, and our ability to realize the intended benefits from any such acquisitions or divestitures;

· our ability to successfully integrate any acquired hospitals, including those of HMA, or to recognize expected synergies from acquisitions;

· the impact of seasonal severe weather conditions;

· our ability to obtain adequate levels of general and professional liability insurance;

· timeliness of reimbursement payments received under government programs;

· effects related to outbreaks of infectious diseases;

· the impact of the external, criminal cyber-attack suffered by us in the second quarter of 2014, including potential reputational damage, the
outcome of our investigation and any potential governmental inquiries, the outcome of litigation filed against us in connection with this

cyber-attack, the extent of remediation costs and additional operating or other expenses that we may continue to incur, and the impact of
potential future cyber-attacks or security breaches;

· any failure to comply with the terms of our Corporate Integrity Agreement ("CIA") with the Office of Inspector General of the Department

of Health and Human Services ("OIG");

· the concentration of our revenue in a small number of states;

· our ability to realize anticipated cost savings and other benefits from our current strategic and operational cost savings initiatives;

· any effects of our previously announced adoption of a Stockholder Protection Rights Agreement;

· any effects related to our previously announced exploration of strategic alternatives; and

· other risk factors disclosed under "Risk Factors" and elsewhere in or incorporated by reference in this prospectus supplement.
Although we believe that these forward-looking statements are based upon reasonable assumptions, these assumptions are inherently subject
to significant regulatory, economic and competitive uncertainties and contingencies, which are difficult or impossible to predict accurately and may
be beyond our control. Accordingly, we cannot give any assurance that our expectations will in fact occur and caution that actual results may differ
materially from those in the forward-looking statements. Given these uncertainties, prospective investors are cautioned not to place undue reliance
on these forward-looking statements. These forward-looking statements speak only as of the date they are made. We undertake no obligation to
revise or update any forward-looking statements, or to make any other forward-looking statements, whether as a result of new information, future
events or otherwise.

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Form 424(b)(5)
SUMMARY
The following summary contains basic information about us and this offering, but does not contain all the information that may be
important to you. For a more complete understanding of this offering, we encourage you to carefully read this entire prospectus supplement,
the accompanying prospectus and the documents incorporated by reference herein and therein, including the information set forth under
"Risk Factors" and our financial statements and related notes. Unless otherwise indicated or the context requires otherwise, references in this
prospectus supplement to "we," "our," "us" and "the Company" refer to Community Health Systems, Inc. and its consolidated subsidiaries,
including CHS/Community Health Systems, Inc., the issuer of the notes offered hereby. References to the "Issuer" refer to CHS/Community
Health Systems, Inc. alone, and references to "Holdings" refer to Community Health Systems, Inc. alone. We refer to the Issuer's 5.125%
Senior Secured Notes due 2018 as the "2018 Secured Notes," to the Issuer's 8.00% Senior Notes due 2019 as the "2019 Notes," to the
Issuer's 7.125% Senior Notes due 2020 as the "2020 Notes," to the Issuer's 5.125% Senior Secured Notes due 2021 as the "2021 Secured
Notes" and to the Issuer's 6.875% Senior Notes due 2022 as the "2022 Notes." The 2018 Secured Notes, 2019 Notes, 2020 Notes, 2021
Secured Notes and 2022 Notes are collectively referred to in this prospectus supplement as the "Existing Notes."
In this prospectus supplement, any amounts shown on an "as adjusted" basis have been adjusted to reflect, as applicable: (i) the
issuance of the notes in this offering and (ii) the use of the net proceeds from this offering to repurchase all the outstanding 2018 Secured
Notes in the Tender Offer discussed below (assuming that all outstanding 2018 Secured Notes are validly tendered and not validly withdrawn
prior to the Early Tender Deadline (as defined below) and accepted for purchase in the Tender Offer), to repay $1.445 billion aggregate
principal amount of terms loans outstanding under our Term F Facility, to pay related fees and expenses and the remainder, if any, for
general corporate purposes. See "Use of Proceeds."
Our Company
We are one of the largest publicly-traded hospital companies in the United States and a leading operator of general acute care hospitals
and outpatient facilities in communities across the country. As of December 31, 2016, we owned or leased 155 hospitals included in
continuing operations, with an aggregate of 26,222 licensed beds, comprised of 152 general acute care hospitals and three stand-alone
rehabilitation or psychiatric hospitals. These hospitals are geographically diversified across 21 states, with the majority of our hospitals
located in regional networks or in close geographic proximity to one or more of our other hospitals. We also owned or leased three hospitals
included in discontinued operations at December 31, 2016. We generate revenues by providing a broad range of general and specialized
hospital healthcare services and outpatient services to patients in the communities in which we are located. In a number of our markets, we
have partnered with local physicians or not-for-profit providers, or both, in the ownership of our facilities. We are paid for our healthcare
services by governmental agencies, private insurers and directly by the patients we serve. For the year ended December 31, 2016, our net
operating revenue was approximately $18.438 billion, our net income attributable to Community Health Systems, Inc. common stockholders
was a loss of approximately $1.721 billion and our Adjusted EBITDA was approximately $2.225 billion. In addition, for the year ended
December 31, 2016, our Further Adjusted EBITDA (which is Adjusted EBITDA further adjusted to (i) remove the impact of the divestitures
we completed in 2016, beginning with the spin-off of 38 hospitals to Quorum Health Corporation in April 2016, as if those dispositions were
completed on January 1, 2016, (ii) include the estimated impact of the hospital acquisitions we completed in 2016 as if we had completed
these acquisitions at the beginning of 2016, and (iii) add back stock-based compensation expense) was approximately $2.169 billion. For
additional information on our presentation of Adjusted EBITDA and Further Adjusted EBITDA, see "Non-GAAP Financial Measures" and
"Summary Historical Financial and Other Data."
We have grown in the past by acquiring hospitals and by improving the operations of our facilities. We have historically targeted
hospitals in growing, non-urban and selected urban healthcare markets for acquisition

S-1
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because of their favorable demographic and economic trends and competitive conditions. Since 2007, we have substantially increased the size
of our business and the number of hospitals we operate through the acquisitions of Triad Hospitals, Inc. and Health Management Associates,
Inc., or HMA. Our growth strategy has also included developing or acquiring select physician practices, physician-owned ancillary service
providers and other outpatient capabilities in markets where we already had a hospital presence. More recently, our efforts have focused on
creating regional networks in select urban markets. We believe opportunities exist for skilled, disciplined operators to create networks
between urban and non-urban hospitals while improving physician alignment in both markets and making these hospitals more attractive to
managed care. Through these regional networks, we have the opportunity to enhance our market position and build market density by
providing more integrated service offerings, establishing additional patient access points for our acute care hospitals, recruiting more
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physicians and expanding our hospitals' local referral network.
We have been implementing a portfolio rationalization and deleveraging strategy by divesting hospitals and non-hospital businesses that
are attractive to strategic and other buyers. Generally, these businesses are not in one of our strategically beneficial service areas, are less
complementary to our business strategy and/or have lower operating margins. More recently, in connection with our announced divestiture
initiative, strategic and other buyers have made offers to buy certain of our assets. Through consideration of these offers, we have divested or
may divest hospitals and non-hospital businesses when we find such offers to be attractive and in line with our operating strategy. By
reducing the size and geographic footprint of our business, we believe this strategy will allow us to focus on our most attractive markets and
regional networks, improve cash flow, reduce leverage, and better position us for the future.
Our Competitive Strengths
We believe the following strengths will allow us to improve our operations:
Geographic diversity and operating scale. As of December 31, 2016, we owned or leased 155 hospitals included in continuing
operations, with an aggregate of 26,222 licensed beds, geographically diversified across 21 states. Our geographic diversity helps to mitigate
risks associated with fluctuating state regulations related to Medicaid reimbursement and state-specific economic conditions. Our top four
states, Florida, Texas, Pennsylvania, and Indiana, contributed approximately 45% of our operating revenues, net of contractual allowances and
discounts (but before the provision for bad debts), in 2016. Furthermore, we believe the size of our operations enables us to realize the
benefits of economies of scale, purchasing power, increased operating efficiencies and increased return on information technology and other
capital investments. In this regard, there are 13 states where we have operations that generated in excess of $500 million of operating revenues,
net of contractual allowances and discounts (but before the provision for bad debts) for the year ended December 31, 2016.
Strong regional network presence. We believe we are one of the leading providers of acute care and outpatient services in many of the
markets we serve. Currently, 73 of our hospitals operate in 11 unique regional networks, which are comprised of one or more larger hospitals
with smaller hospitals located in nearby communities. Within each regional network, we leverage the network's brand and local scale to
expand our continuum of care, enhance access to our facilities, provide a more integrated service offering and reduce costs through increased
operating efficiencies. Additionally, 34 of our hospitals operate in close geographic proximity to one or more of our other hospitals in 13
geographic areas. For these hospitals, we seek to develop or expand similar specialty services and outpatient services at our regional networks
to yield high patient and physician satisfaction, improve revenue and gain operational efficiencies. As of December 31, 2016, we estimate that
approximately 70% of our facilities are located in regional networks or are in close proximity to another CHS hospital.

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We believe our market positioning strategy will create growth opportunities, allow us to develop long-term relationships with patients,
physicians, employers and third-party payors and enable us to achieve an attractive return on investments in the expansion of our facilities and
outpatient services and in physician recruitment.
Positioned for growth in outpatient services. We believe outpatient services widen the catchment area for our hospitals and regional
networks and are consistent with care delivery trends, including greater convenience for our patients, increased efficiency for our physicians
and lower cost of care for our patients and payors. Outpatient services generated approximately 57% of our net revenues for the year ended
December 31, 2016. We intend to continue to invest in outpatient services to meet the needs of our communities, provide greater access to
medical care and enhance the overall experience of our patients. In 2016, 63% of amounts incurred on our completed major capital projects
related to outpatient services, compared to 37% in 2015. In particular, we have made capital investments at several strategic hospital locations
to establish free-standing emergency departments, and expect to continue to make these investments in the future. In general, outpatient
services require less capital investment than our acute care hospitals and provide an opportunity for attractive operating margins and a higher
return on investment.
Emphasis on patient safety and quality of care. We maintain an emphasis on patient safety, the provision of quality care and improving
clinical outcomes. We understand that high levels of quality are only achieved with a company-wide focus that embraces patient, physician
and employee satisfaction and continual, systematic clinical improvements. We believe that a focus on continuous improvement yields the best
results for patients, reduces risk and improves revenue through achievement of quality measures. We have developed and implemented
programs to support and monitor patient safety and quality of care that include:

· standardized data and benchmarks to monitor hospital performance and quality improvement efforts;
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· recommended policies and procedures based on nationally recognized medical and scientific evidence as well as training on evidence-

based tools for improving patient, physician and employee satisfaction;

· leveraging of technology and sharing of evidence-based clinical best practices;

· training programs for hospital management and clinical staff regarding regulatory and reporting requirements; and

· implementation of specific leadership methods and error-prevention tools to create safer care environments for patients and staff.
As a result of these efforts, we have made significant progress in patient safety and clinical quality. In the facilities we have operated
since before our acquisition of HMA (the "legacy facilities"), we have achieved a 79.9% reduction in Serious Safety Events through the third
quarter of 2016 from our baseline in 2013. In our more recently acquired HMA facilities, there has been a 29.6% reduction in Serious Safety
Events through the third quarter of 2016 from their baseline in 2015. In addition, for our legacy facilities, we have significantly reduced
Hospital-Acquired Infections, or HAIs, over the past several years, with a reduction in every HAI measure for each year that the measures
have been publicly reported. Moreover, for the legacy facilities, our total HAI reduction rate was 28.9% from 2011 to 2016. Our quality
efforts, along with payor incentive arrangements, generated approximately $15 million in 2016 earned incentives.
Strong history of improving operations and making strategic investments resulting in well capitalized facilities. We have extensive
experience in improving the operations of our facilities. We have developed and implemented standardized and centralized services across key
business areas, recruited new physicians and hospital leaders, and executed cost saving initiatives. Additionally, we have improved operations
at many of our acquired facilities through strategies that have included expanding service offerings to include more complex care, optimizing
our emergency room approach, increasing outpatient services and making capital investments in selected projects that generate an attractive
return on investment. Our facilities have been well capitalized

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through strategic investments and represent a significant and tangible asset base. Many facilities have undergone or completed significant
renovation or expansion projects within the last several years. In addition, we own 127 of the 158 total facilities we operated as of
December 31, 2016 (14 of which were subject to definitive sale agreements entered into as of February 28, 2017, that had not yet closed),
which provides a valuable real estate base.
Experienced management team with a proven track record. We have a strong and committed management team that has substantial
industry knowledge and a proven track record of operations success in the hospital industry. Our chief executive officer and chief financial
officer each have over 30 years of experience in the healthcare industry and have worked together since 1973. We recently strengthened our
senior management team by promoting a new president and chief operating officer, with over 20 years of experience in the hospital industry.
Our five division presidents have each worked at CHS for many years and average 21 years of experience in hospital and division executive
roles. Additionally, we have recently made several key external hires to further strengthen our senior management team, including Tom
Aaron, who will be replacing Larry Cash as our chief financial officer following Mr. Cash's retirement at our annual meeting of stockholders
in May 2017.
Our Business Strategy
The key elements of our business strategy are to:
Optimize our asset portfolio. We are in the process of divesting certain hospital facilities and other non-hospital businesses in
furtherance of our portfolio rationalization and deleveraging strategy as noted above. More recently, in connection with our announced
divestiture initiative, strategic and other buyers have made offers to buy certain of our assets. Through consideration of these offers we have
divested or may divest hospitals and non-hospital businesses when we find such offers to be attractive and in line with our operating strategy.
By managing the size and geographic footprint of our business, we believe that we can focus future investments on our most attractive
markets and regional networks where we have an opportunity to enhance our market position by providing additional patient access points to
our inpatient and outpatient services and recruiting more physicians to improve the quality of care. We intend to continue to evaluate offers
from potential buyers for additional divestitures to optimize our asset portfolio and believe this strategy will position us to improve cash flow
and reduce leverage.
Since April 2016, we have received approximately $1.6 billion in proceeds from the spin-off of Quorum Health Corporation and sale of
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Form 424(b)(5)
our joint venture in Las Vegas, Nevada and another $287 million from the sale of investments in non-hospital operations. As of February 28,
2017, we had entered into definitive agreements with respect to the sale of 15 hospitals, and expect to receive approximately $900 million in
proceeds from the sale of these facilities in 2017, if all of these sales are completed on the terms expected as of such date. Additionally, as of
February 28, 2017, we had executed non-binding letters of intent with respect to the sale of ten hospitals, and expect to receive approximately
$600 million in proceeds from the sale of these facilities in 2017, if all of these sales are completed on the terms expected as of such date. In
addition to those ten hospitals subject to non-binding letters of intent, as of February 28, 2017, we were in preliminary discussions with
respect to the sale of additional hospitals, including in certain cases where we had entered into non-binding letters of intent where discussions
were at a more preliminary stage relative to those ten hospitals. Proceeds received from our portfolio rationalization program have been used,
and are expected to continue to be used, to repay indebtedness. In addition, at such time, if any, that these additional divestitures are
completed, these facilities will no longer be part of our operations and the guarantees of the notes by subsidiary guarantors sold as part of these
divestitures will be released.
Increase revenue at our facilities. We are implementing a strategy to expand and rationalize service lines. We believe this focused
service line strategy facilitates better capital allocation and drives volume, acuity and rate growth in desirable areas. In addition, we are
expanding the medical services we provide through the

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recruitment of additional primary care physicians and specialists. We have further emphasized our recruiting efforts with respect to both
employed and affiliated physicians by recruiting approximately 3,896 physicians in 2016, 4,152 in 2015 and 3,765 in 2014. In addition, over
70% of the physicians that commenced practice with us in 2016 were specialists. As of December 31, 2016, we had 20,500 physicians on
medical staffs. Recently, we have implemented a number of management tools to assist us in measuring and improving physician
performance, improving workflow and increasing physician retention.
In addition, we intend to continue to expand the breadth of services offered at our hospitals through targeted capital expenditures, new
service line strategies to add more complex and specialty services, increase the number of patient transfer centers to better coordinate care, and
implement digital health solutions to improve patient engagement and satisfaction. Additionally, our capital expenditures have supported
expanding the number of patient access points separate from the traditional hospital service location, including free-standing emergency
departments, surgery centers, urgent care centers, and other sites that provide quicker access to care in a lower cost setting. Some of our
initiatives include:

· Expanding our orthopedic program. We have implemented a program developed by an industry leading orthopedic consultant at 35
hospitals, and have experienced a 5% same-store increase in hip or knee replacement surgery volumes in 2016. We intend to

implement this program at 16 additional hospitals in 2017. We believe these standardized programs also benefit other orthopedic
services at our hospitals;

· Expanding and renovating existing emergency rooms to improve service and reduce waiting times. We have implemented marketing

campaigns in our local communities to increase awareness of our emergency room capabilities;

· Increasing the number of patient transfer centers to better coordinate care among our physicians, hospitals and outpatient
centers. Transfer centers enable patients to be transported to the facility that provides the appropriate services they need, provide

increased visibility into local hospital operations and help identify future service line opportunities for our hospitals. In 2016, 76 of
our hospitals used an outsourced vender to facilitate over 17,000 transfers; and

· Leveraging digital tools to create virtual access points, and improve our patient and physician experiences. These digital solutions use
clinical protocols and analytics to drive patient outreach for scheduling appointments, assisting with referral management to keep

patients in network when possible and provide post care follow-up, including treatment plans, health education, prescription reminders
and prevention screening. We also have introduced a tool that enables patients to compare pricing for select outpatient services among
our facilities and those of competitors in our markets.
In addition to these initiatives, we believe our investments in expanding our footprint and patient access points through free-standing
emergency departments, ambulatory surgery centers and urgent care centers will generate increased revenues and earnings from businesses
with higher growth and operating margins. We believe that appropriate capital investments in our outpatient facilities combined with the
development of our service capabilities will increase patient retention while providing an attractive return on investment. As of December 31,
2016, we had 58 surgery centers, 51 urgent care centers, 44 walk-in retail clinics, 9 free standing emergency departments, 149 diagnostic
centers and approximately 1,000 physician clinics.
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