Item 8.01 Other Events
On January 9, 2017,
the Company announced that Merger Sub intends to offer $1,015 million aggregate principal amount of Senior Notes due 2025 (the
“Notes”), subject to market and other conditions. Merger Sub intends to use the proceeds from the offering of the Notes
to finance a portion of the cash consideration for the Merger. Merger Sub is not an affiliate of the Company.
A
copy of the press release announcing the offering of the Notes is attached hereto as Exhibit 99.2 and is incorporated by reference
in this Item 8.01.
Unless the Merger and
certain related transactions are consummated simultaneously with the offering of the Notes, Merger Sub will deposit (or cause to
be deposited) the gross proceeds of the offering of the Notes into a segregated escrow account until the date that certain escrow
release conditions, including the consummation of the Merger, have been satisfied. The Notes will be senior unsecured obligations
of Merger Sub. Upon the release of the proceeds from escrow, the Company will assume the obligations under the Notes and the Notes
will initially be guaranteed by certain of the Company’s subsidiaries on a senior unsecured basis.
The Notes and the related
guarantees will be offered to persons reasonably believed to be qualified institutional buyers in accordance with Rule 144A under
the Securities Act of 1933, as amended (the “Securities Act”), and to non-U.S. persons outside the United States pursuant
to Regulation S under the Securities Act. The Notes and the related guarantees have not been registered under the Securities Act
or any state or other jurisdiction’s securities laws. Accordingly, the Notes may not be offered or sold in the United States absent
registration or an applicable exemption from registration requirements under the Securities Act and any applicable state or other
jurisdiction’s securities laws.
In addition, on January
9, 2017, Team Health, Inc., a Tennessee corporation (“Team Health”), a wholly-owned subsidiary of the Company, requested
that the trustee under the indenture, dated as of November 23, 2015, among Team Health, the guarantors party thereto and Wells
Fargo Bank, National Association, as trustee, governing Team Health’s 7.250% Senior Notes due 2023 (the “Existing
Notes”), on behalf of Team Health, provide notices of redemption to the holders of the Existing Notes, specifying February
6, 2017 as the redemption date. The redemption of the Existing Notes is subject to the satisfaction of certain conditions
specified in the notices of redemption, including the completion of the Merger and certain other transactions in connection with
the Merger.
Forward Looking Statements
This
report contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995.
Some of these statements can be identified by terms and phrases such as “anticipate,” “believe,” “intend,”
“estimate,” “expect,” “continue,” “could,” “should,” “may,”
“plan,” “project,” “predict” and similar expressions. The Company cautions that such “forward
looking statements,” including without limitation, those relating to the Merger being completed within the anticipated timeframe
or at all, the realization of the expected benefits of the Merger, the Company’s and the combined business’s future
business prospects, revenue,
working
capital, professional liability expense, liquidity, capital needs, interest costs and income, wherever they occur in this report
or in other statements attributable to the Company are necessarily estimates reflecting the judgment of the Company’s senior
management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested
by the “forward looking statements.” Factors that could cause our actual results to differ materially from those expressed
or implied in such “forward-looking statements,” include but are not limited to the occurrence of any event that could
give rise to a termination of the Merger Agreement, the risks that the Merger disrupts current plans and operations, current or
future government regulation of the healthcare industry, exposure to professional liability lawsuits and governmental agency investigations,
the adequacy of insurance coverage and insurance reserves, as well as those factors detailed from time to time in the Company’s
filings with the Securities and Exchange Commission.
The
Company’s forward looking statements speak only as of the date hereof and the date they are made. The Company disclaims any
intent or obligation to update “forward looking statements” made in this report to reflect changed assumptions, the
occurrence of unanticipated events, or changes to future operating results over time.