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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14D-9/A
SOLICITATION/RECOMMENDATION STATEMENT
PURSUANT TO SECTION 14(D)(4) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 1)
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COMMUNITY HEALTH SYSTEMS, INC.
(Name of Subject Company)
COMMUNITY HEALTH SYSTEMS, INC.
(Name of Person(s) Filing Statement)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
203666 10 2
(CUSIP NUMBER OF CLASS OF SECURITIES)
E. Thomas Chaney
President and Chief Executive Officer
Community Health Systems, Inc.
155 Franklin Road, Suite 400
Brentwood, Tennessee 37024
(Name, address and telephone number of person
authorized to receive notice and communications on
behalf of the person(s) filing statement).
With Copies to:
J. Michael Schell, Esq.
Skadden, Arps, Slate, Meagher & Flom
919 Third Avenue
New York, New York 10022
(212) 735-3000
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This Amendment No. 1 amends and supplements the Solicitation/Recommendation
Statement on Schedule 14D-9, dated June 11, 1996 (the "Schedule 14D-9"), of
Community Health Systems, Inc., a Delaware corporation (the "Company"), filed in
connection with the Offer as set forth in the Schedule 14D-9. Capitalized terms
used herein shall have the definitions set forth in the Schedule 14D-9 unless
otherwise provided herein.
ITEM 2. TENDER OFFER OF THE PURCHASER.
The response to Item 2 is hereby amended by deleting the first sentence of
the second paragraph thereof and inserting the following in lieu thereof:
"The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of June 9, 1996, as amended by an amendment thereto dated as of July 9 1996
(the "Amendment"), (as amended, the "Merger Agreement"), among Parent, the
Purchaser and the Company."
The response to Item 2 is hereby further amended by adding the following to
the end of the second paragraph thereof:
"A copy of the Amendment is attached hereto as Exhibit 13 and incorporated
herein by reference."
ITEM 3. IDENTITY AND BACKGROUND.
The response to Item 3(b)(1) is hereby amended by deleting the first two
sentences of the seventh paragraph thereof and inserting the following in lieu
thereof:
"The Merger Agreement provides that all options (individually, an "Option"
and collectively, the "Options") outstanding under any Company stock option plan
(the "Stock Option Plans"), whether or not then exercisable, shall be cancelled
immediately prior to the Effective Time or, at the request of Parent, prior to
the expiration of the Offer and each holder of an Option will be entitled to
receive, for each Share subject to an Option, an amount in cash equal to the
excess, if any, of the Merger Consideration over the per Share exercise price of
such Option, without interest (the "Option Consideration"). The Merger Agreement
also provides that the Option Consideration shall be paid by the Surviving
Corporation at the Effective Time or, at the request of Parent, by the Company
immediately prior to the expiration of the Offer.
The response to Item 3(b)(2) is hereby further amended by adding the
following:
DEBT TENDER OFFER. Pursuant to the Merger Agreement, on June 11, 1996, the
Company commenced an offer to purchase for cash all of its outstanding 10 1/4%
Senior Subordinated Debentures due 2003 (the "Debentures"), for an amount of
cash equal to 107.75% of their principal amount ($1,077.50 per $1,000 principal
amount), plus accrued and unpaid interest to, but not including, the payment
date, as more fully described in the Offer to Purchase and Consent Solicitation
Statement dated June 11, 1996 (the "Debenture Offer"). In connection with the
Debenture Offer, the Company is also soliciting consents to certain proposed
amendments (the "Proposed Amendments") to the Indenture, dated as of August 11,
1993, relating to the Debentures, and is offering to pay (i) to each holder of
Debentures as of the record date who validly consents to the Proposed Amendments
prior to the consent date an amount in cash equal to .75% of the principal
amount ($7.50 per $1,000 principal amount) of the Debentures for which consents
have been validly delivered and not revoked as of the consent date, whether or
not the Debenture Offer is consummated (the "Early Consent Payment"), and (ii)
if the Debenture Offer is consummated, to each holder who validly consents to
the Proposed Amendments prior to the expiration date of the Debenture Offer an
amount in cash equal to $1.25% of the principal amount ($12.50 per $1,000
principal amount) of the Debentures for which consents have been validly
delivered and not revoked prior to the expiration date of the Debenture Offer.
On June 26, 1996, Parent, the Purchaser and the Company entered into a
letter agreement with respect to the Debenture Offer, whereby (a) the Company
agreed to make the Early Consent Payment
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with respect to the Debenture Offer and (b) the Purchaser agreed to reimburse
the Company for such payment, under certain circumstances, if the Merger
Agreement is terminated. The letter agreement is filed as Exhibit 14 hereto and
is incorporated herein by reference.
On June 27, 1996, the Company issued a press release announcing the
execution of a supplemental indenture, containing the Proposed Amendments, in
connection with the Debenture Offer. The press release is filed as Exhibit 15
hereto and is incorporated herein by reference.
ITEM 6. RECENT TRANSACTIONS AND INTENT WITH RESPECT TO SECURITIES.
The response to Item 6(a) is hereby amended by deleting such response and
inserting the following in lieu thereof:
"Except as set forth in Annex C hereto and as set forth below, to the best
of the Company's knowledge, no transactions in the Shares have been effected
during the past 60 days by the Company or, to the best of the Company's
knowledge, by any executive officer, director, affiliate or subsidiary of the
Company. On June 25, 1996, James T. McAfee, Jr., a director of the Company,
transferred 43,591 Shares to a newly established trust and 28,847 Shares to
Mercer University."
The response to Item 6(b) is hereby amended by deleting such response and
inserting the following in lieu thereof:
"Except as set forth below, to the best of the Company's knowledge, to the
extent permitted by applicable securities laws, rules or regulations, each
executive officer, director and affiliate of the Company currently intends to
tender all Shares over which he or she has sole dispositive power to the
Purchaser. Messrs. Ragsdale and Chaney have been advised that if they are
offered the opportunity to invest in the equity of the Parent and if they decide
to accept any such offer, it could be desirable to effect such investment
through an exchange of Shares for shares of Parent common stock. Accordingly,
although no final decision has been made, Messrs. Ragsdale and Chaney may, in
order to maximize their planning flexibility, tender less than 100% of the
Shares over which they have sole dispositive power."
ITEM 9. MATERIAL TO BE FILED AS EXHIBITS.
The response to Item 9 is hereby amended and supplemented by adding the
following:
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EXHIBIT
NO.
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Exhibit 13. Amendment, dated as of July 9, 1996, to the Agreement and Plan of Merger, dated as of June 9, 1996
among Community Health Systems, Inc., FLCH Holdings Corp., and FLCH Acquisition Corp.
Exhibit 14. Letter Agreement, dated June 26, 1996, by and among Parent, the Purchaser and the Company.
Exhibit 15. Press Release issued by the Company, dated June 27, 1996.
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SIGNATURE
After reasonable inquiry and to the best of my knowledge and belief, I
certify that the information set forth in this statement is true, complete and
correct.
Dated: July 9, 1996 COMMUNITY HEALTH SYSTEMS, INC.
By /s/ E. THOMAS CHANEY
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Name: E. Thomas Chaney
Title: President and Chief
Executive Officer
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INDEX TO EXHIBITS
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<CAPTION>
EXHIBIT
NO. DESCRIPTION
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Exhibit 13. Amendment, dated as of July 9, 1996, to the Agreement and Plan of Merger, dated as of June
9, 1996 among Community Health Systems, Inc., FLCH Holdings Corp., and FLCH Acquisition
Corp.
Exhibit 14. Letter Agreement, dated June 26, 1996, by and among Parent, the Purchaser and the Company.
Exhibit 15. Press Release issued by the Company, dated June 27, 1996.
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EXHIBIT 13
AMENDMENT
Each of the parties to the Agreement and Plan of Merger, dated as of June 9,
1996 (the "Merger Agreement") among Community Health Systems, Inc. (the
"Company"), FLCH Holdings Corp. ("Purchaser"), and FLCH Acquisition Corp.
("Merger Sub") hereby agrees to the following amendment to the Merger Agreement
effective as of the date hereof:
Section 5.2(d) shall be amended by deleting the first two sentences of such
paragraph and inserting in lieu thereof:
"All options (individually, an "OPTION" and collectively, the "OPTIONS")
outstanding under any Company stock option plan (the "STOCK OPTION PLANS"),
whether or not then exercisable, shall be canceled immediately prior to the
Effective Time or, at the request of Purchaser, prior to the expiration of the
Offer and each holder of an Option will be entitled to receive, for each share
of Common Stock subject to an Option, an amount in cash equal to the excess, if
any, of the Merger consideration over the per share exercise price of such
Option, without interest (the "OPTION CONSIDERATION"). Payment of the Option
Consideration pursuant to this SECTION 5.2(D) shall be made by the Surviving
Corporation at the Effective Time or, at the request of Parent, by the Company
prior to the expiration of the Offer.
Dated: July 9, 1996 COMMUNITY HEALTH SYSTEMS, INC.
By: /s/ KAY W. SLAYDEN
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Name: Kay W. Slayden
Title: Chairman of the Special
Committee
FLCH HOLDINGS CORP.
By: /s/ THOMAS H. LISTER
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Name: Thomas H. Lister
Title: Vice President
FLCH ACQUISITION CORP.
By: /s/ THOMAS H. LISTER
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Name: Thomas H. Lister
Title: Vice President
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EXHIBIT 14
FLCH HOLDINGS CORP.
FLCH ACQUISITION CORP.
C/O FORSTMANN LITTLE & CO.
767 FIFTH AVENUE
NEW YORK, NEW YORK 10153
June 26, 1996
Community Health Services, Inc.
155 Franklin Road
Suite 400
Brentwood, TN 37027-4600
Attention: Chairman of the Board and
Chairman of the Special Committee
RE: Agreement and Plan of Merger, dated as of
June 9, 1996 (the "Agreement"), between
FLCH Holdings Corp. ("Purchaser"), FLCH
Acquisition Corp. and Community Health
Systems, Inc. (the "Company")
Gentlemen:
This will confirm our agreement as follows: (i) the Company will make the
Early Consent Payment referred to in the Company's Offer to Purchase and Consent
Solicitation Statement, dated June 11, 1996, with respect of the Debenture Offer
(as defined in the Agreement), and (ii) the Purchaser will reimburse the Company
for such payment if the Merger Agreement is terminated, unless such termination
occurs under the circumstances described in Section 11.5(b)(2) of the Merger
Agreement, in which event such reimbursement shall not be made except to the
extent that such Early Consent Payment, together with the other expenses to be
reimbursed to Purchaser under Section 11.5(b)(2), would exceed $15,000,000.
Sincerely,
FLCH HOLDINGS CORP.
By: /s/ THOMAS H. LISTER
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Name: Thomas H. Lister
Title: Vice President
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FLCH ACQUISITION CORP.
By: /s/ THOMAS H. LISTER
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Name: Thomas H. Lister
Title: Vice President
AGREED TO AND ACCEPTED AS OF THE
DATE SET FORTH ABOVE:
COMMUNITY HEALTH SERVICES, INC.
By: /s/ TYREE G. WILBURN
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Name: Tyree G. Wilburn
Title: Senior Vice President
and Chief
Financial Officer
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EXHIBIT 15
[LETTERHEAD OF GEORGESON & COMPANY INC.]
CONTACT:
Arthur B. Crozier
FOR IMMEDIATE RELEASE Georgeson & Company Inc.
June 27, 1996 (212) 440-9861
COMMUNITY HEALTH SYSTEMS ANNOUNCES EXECUTION OF
SUPPLEMENTAL INDENTURE IN CONNECTION WITH ITS
10 1/4% SENIOR SUBORDINATED DEBENTURES
BRENTWOOD, TENNESSEE -- Community Health Systems, Inc. announced today that
as of 5:00 p.m., New York City time, on June 25, 1996, valid consents in respect
of $89,753,000 aggregate principal amount of outstanding Debentures had been
received by the depositary (and not thereafter revoked) in connection with the
Company's offer to purchase for cash all of its outstanding 10 1/4% Senior
Subordinated Debentures due 2003 and the solicitation of consents to certain
proposed amendments to the Indenture, dated as of August 11, 1993, relating to
the Debentures. A supplemental indenture containing the proposed amendments was
executed by the Company and the indenture trustee on June 25, 1996. The proposed
amendments, however, will not become operative unless and until the Debentures
are accepted for purchase by the Company, which is expected to occur promptly
after the expiration of the offer.
Pursuant to the terms of the Offer to Purchase and Consent Solicitation
Statement dated June 11, 1996 (the "Offer to Purchase"), the Early Consent
Payment (as defined in the Offer to Purchase) is being paid by the depositary,
on behalf of the Company, to each registered holder of Debentures as of the
record date for the offer who validly consented to the proposed amendments on or
before June 25, 1996.
The offer commenced on June 11, 1996 and is scheduled to expire at 12:00
p.m., midnight, New York City time, on July 9, 1996, unless extended. The offer
is being made, and the consents are being solicited in connection with, the
acquisition of the Company by an affiliate of Forstmann Little & Co.
Debenture holders may obtain information relating to the offer by contacting
either Lehman Brothers, the dealer manager in connection with the offer, at
(800) 438-3242, or Georgeson & Company Inc., the information agent in connection
with the offer, at (800) 223-2064.
