Hospital Corporation of America and Subsidiaries - Page 7

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          transaction would help petitioners obtain a greater amount of               
          cash consideration for the Facilities.3                                     
               In furtherance of the reorganization, petitioners activated            
          HCA Holding Corp., which prior to that time had been an inactive            
          HCA subsidiary incorporated under the laws of the State of                  
          Delaware.  HCA Investments, Inc. (HCAII), another wholly owned              
          HCA subsidiary, owned all of the stock of HCA Holding Corp.,                
          which latter corporation was renamed HealthTrust, Inc.--The                 
          Hospital Co. (HealthTrust).                                                 
               HCA Management selected R. Clayton McWhorter (Mr.                      
          McWhorter), HCA's then president and chief operating officer, to            
          become chairman and chief executive officer of HealthTrust.  At             
          that time, he had been employed by HCA for 17 years and had been            
          a member of HCA's executive management since 1976.  Mr. McWhorter           
          chose Charles N. Martin, Jr. (Mr. Martin), HCA's then executive             
          vice president for marketing and development, to become president           
          and chief operating officer of HealthTrust.  Mr. Martin had                 
          joined HCA in 1980, after serving as president of General Care              
          Corp.  Mr. McWhorter picked Donald S. MacNaughton (Mr.                      
          MacNaughton), then chairman of HCA's executive committee, to                


          3  In a leveraged ESOP buyout the funds borrowed to finance the             
          acquisition to a large extent are repaid with tax-deductible                
          contributions to the ESOP, and the lenders generally charge less            
          interest because they receive tax benefits with respect to the              
          interest they receive.                                                      






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