1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 11-K
[X] ANNUAL REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the fiscal year ended December 31, 2000
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934 (NO FEE REQUIRED)
For the transition period from ________ to _______
Commission file number 0-29818
A. Full title of the plan and the address of the plan, if different from that of
the issuer named below:
LifePoint Hospitals, Inc. Retirement Plan
B. Name of issuer of the securities held pursuant to the plan and the address of
its principal executive office:
LifePoint Hospitals, Inc.
103 Powell Court, Suite 200
Brentwood, TN 37027
2
LifePoint Hospitals, Inc. Retirement Plan
Audited Financial Statements and Supplemental Schedule
For the year ended December 31, 2000 and
for the period from May 11, 1999 (date of inception)
to December 31, 1999
Contents
Report of Independent Auditors..............................................1
Audited Financial Statements
Statements of Net Assets Available for Benefits.............................2
Statements of Changes in Net Assets Available for Benefits..................3
Notes to Financial Statements...............................................4
Supplemental Schedule
Schedule of Assets (Held at End of Year)...................................12
3
Report of Independent Auditors
The Plan Sponsor
LifePoint Hospitals, Inc. Retirement Plan
We have audited the accompanying statements of net assets available for benefits
of LifePoint Hospitals, Inc. Retirement Plan as of December 31, 2000 and 1999,
and the related statements of changes in net assets available for benefits for
the year ended December 31, 2000 and the period May 11, 1999 (date of inception)
to December 31, 1999. These financial statements are the responsibility of the
Plan's management. Our responsibility is to express an opinion on these
financial statements based on our audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
In our opinion, the financial statements referred to above present fairly, in
all material respects, the net assets available for benefits of the Plan at
December 31, 2000 and 1999, and the changes in its net assets available for
benefits for the year ended December 31, 2000 and for the period May 11, 1999
(date of inception) to December 31, 1999, in conformity with accounting
principles generally accepted in the United States.
Our audit was performed for the purpose of forming an opinion on the financial
statements taken as a whole. The accompanying supplemental schedule of assets
(held at end of year) as of December 31, 2000 is presented for purposes of
additional analysis and is not a required part of the financial statements but
are supplementary information required by the Department of Labor's Rules and
Regulations for Reporting and Disclosure under the Employee Retirement Income
Security Act of 1974. This supplemental schedule is the responsibility of the
Plan's management. The supplemental schedule has been subjected to the auditing
procedures applied in our audits of the financial statements and, in our
opinion, is fairly stated in all material respects in relation to the financial
statements taken as a whole.
/s/ Ernst & Young LLP
Nashville, Tennessee
June 26, 2001
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LifePoint Hospitals, Inc. Retirement Plan
Statements of Net Assets Available for Benefits
DECEMBER 31, 2000 DECEMBER 31, 1999
------------------------------------------ ------------------------------------------
PARTICIPANTS' ESOP SHARES PARTICIPANTS' ESOP SHARES
ACCOUNTS FUND ACCOUNTS FUND
(ALLOCATED) (UNALLOCATED) TOTAL (ALLOCATED) (UNALLOCATED) TOTAL
----------- ------------- ------------ ----------- ------------- ------------
ASSETS
Investments, at fair value $168,937,703 $122,365,050 $291,302,753 $136,541,540 $ 32,311,783 $168,853,323
Employer contributions receivable -- 3,762,359 3,762,359 -- 2,527,314 2,527,314
Participant contributions receivable 77,294 -- 77,294 -- -- --
Pending trade sales 1,878,131 -- 1,878,131 -- -- --
Income receivable 11,845 -- 11,845 -- -- --
------------ ------------ ------------ ------------ ------------ ------------
170,904,973 126,127,409 297,032,382 136,541,540 34,839,097 171,380,637
LIABILITIES
Cash overdraft -- -- -- 33,839 -- 33,839
Accrued interest payable to LifePoint
Hospitals, Inc. -- 2,317,104 2,317,104 -- 1,438,050 1,438,050
Note payable to LifePoint Hospitals, Inc.
-- 28,091,513 28,091,513 -- 32,162,266 32,162,266
Expenses payable 10,898 -- 10,898 -- -- --
Excess contributions payable 647,635 -- 647,635 150,661 -- 150,661
------------ ------------ ------------ ------------ ------------ ------------
658,533 30,408,617 31,067,150 184,500 33,600,316 33,784,816
------------ ------------ ------------ ------------ ------------ ------------
Net assets available for benefits $170,246,440 $ 95,718,792 $265,965,232 $136,357,040 $ 1,238,781 $137,595,821
============ ============ ============ ============ ============ ============
See accompanying notes.
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LifePoint Hospitals, Inc. Retirement Plan
Statements of Changes in Net Assets Available for Benefits
PERIOD FROM MAY 11, 1999 (DATE OF
YEAR ENDED DECEMBER 31, 2000 INCEPTION) TO DECEMBER 31, 1999
------------------------------------------ ------------------------------------------
PARTICIPANTS' ESOP SHARES PARTICIPANTS' ESOP SHARES
ACCOUNTS FUND ACCOUNTS FUND
(ALLOCATED) (UNALLOCATED) TOTAL (ALLOCATED) (UNALLOCATED) TOTAL
----------- ------------- ------------ ----------- ------------- ------------
ADDITIONS
Net appreciation in fair value of
investments $ 31,353,954 $ 96,337,298 $ 127,691,252 $ 17,211,437 $ 838,440 $ 18,049,877
Interest and dividend income 467,695 -- 467,695 243,823 -- 243,823
Employer contributions -- 6,056,795 6,056,795 688,923 2,527,314 3,216,237
Participants' contributions 5,202,896 -- 5,202,896 3,039,907 -- 3,039,907
------------- ------------- ------------- ------------ ------------- ------------
Total additions 37,024,545 102,394,093 139,418,638 21,184,090 3,365,754 24,549,844
DEDUCTIONS
Benefits paid 16,083,161 -- 16,083,161 5,221,568 -- 5,221,568
Interest expense -- 2,317,104 2,317,104 -- 1,438,050 1,438,050
Administrative expenses 560,044 -- 560,044 185,556 -- 185,556
------------- ------------- ------------- ------------ ------------- ------------
Total deductions 16,643,205 2,317,104 18,960,309 5,407,124 1,438,050 6,845,174
Allocation of ESOP shares to Plan 5,596,978 (5,596,978) -- 688,923 (688,923) --
Transfer out of the Plan (6,570,729) -- (6,570,729) -- -- --
Transfers from HCA - The Healthcare
Company-sponsored plans 14,481,811 -- 14,481,811 119,891,151 -- 119,891,151
------------- ------------- ------------- ------------ ------------- ------------
Net increase in net assets available for
benefits 33,889,400 94,480,011 128,369,411 136,357,040 1,238,781 137,595,821
Net assets available for benefits at
beginning of period 136,357,040 1,238,781 137,595,821 -- -- --
------------- ------------- ------------- ------------ ------------- ------------
Net assets available for benefits at
end of period $ 170,246,440 $ 95,718,792 $ 265,965,232 $136,357,040 $ 1,238,781 $137,595,821
============= ============= ============= ============ ============= ============
See accompanying notes.
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements
December 31, 2000
1. DESCRIPTION OF THE PLAN
The following description of LifePoint Hospitals, Inc. Retirement Plan (the
"Plan") provides only general information. Participants should refer to the Plan
document for a more complete description of the Plan's provisions.
GENERAL
The Plan is a defined contribution plan covering all employees of LifePoint
Hospitals, Inc. (the "Company") who have completed two full months of service
and are age 21 or older. The Plan was effective May 11, 1999. On May 11, 1999,
HCA-The Healthcare Company (previously Columbia/HCA Healthcare Corporation)
("HCA") created two tax-free spin-off companies, the Company and Triad
Hospitals, Inc. Effective with the spin-off, the investment accounts of
employees of the newly formed Company were transferred to the Plan. All
employees of the Company at May 11, 1999 were eligible to participate in the
Plan except employees covered under a collective bargaining agreement. The Plan
is subject to the provisions of the Employee Retirement Income Security Act of
1974 (ERISA).
The Plan is also an "employee stock ownership plan" ("ESOP") within the meaning
of Section 4975(e)(7) of the Internal Revenue Code of 1986, as amended (the
"Code"). As an ESOP, the Plan generates certain favorable federal income tax
consequences to the Company and the beneficiaries of the Plan.
CONTRIBUTIONS
Participants may elect to contribute a fixed percentage of a participant's
pre-tax compensation ("Salary Deferral Contribution") and voluntary after-tax
amounts ("Employee Voluntary Contributions"). The total of Salary Deferral
Contributions elected by a participant cannot exceed 15% of the participant's
compensation for a Plan year. The Employee Voluntary Contributions elected by a
participant cannot exceed 10% of the participant's compensation for the plan
year.
In addition, the Company makes a matching contribution of Company stock in an
amount equal to 50% of the amount the participant has elected as a Salary
Deferral Contribution for that payroll period ("Salary Deferral Matching
Contribution Allocation") and an amount equal to 18% of the amount the
participant has elected as an Employee Voluntary Contribution for that payroll
period ("Employee Voluntary Matching Contribution
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
CONTRIBUTIONS (CONTINUED)
Allocation"). The Salary Deferral Matching Contribution Allocation for any
participant is limited to 1.5% of a participant's compensation for the Plan
year.
In any Plan year the Company may contribute to participants' accounts cash or
Company stock as determined by the Company's Board of Directors ("ESOP
Contributions"). In addition, discretionary Company profit sharing contributions
may be made upon a vote of the Board of Directors ("Profit Sharing
Contributions"). To be eligible for an allocation of the ESOP Contributions and
Profit Sharing Contributions, a participant must meet the following
requirements:
(i) Participant is age 21 or older on the last day of the Plan
year,
(ii) Participant completed one year of service during the Plan
year, and
(iii) Participant is an employee as of the last day of the Plan
year.
An additional contribution by the Company in an amount determined by the Company
to assure that the Plan satisfies certain tests under the Code may be allocated
solely to the accounts of participants who are considered non-highly compensated
employees and have elected to make Salary Deferral Contributions for the Plan
year ("Unilateral Employer Contributions").
Contributions are subject to certain limitations under the Code.
PARTICIPANT ACCOUNTS
Each participant's account is credited with the participant's contribution, the
Company's contribution of shares of the Company's common stock released by the
Company from the suspense account and Plan earnings. Allocations are based on
participant earnings or account balances, as defined in the Plan document. The
benefit to which a participant is entitled is the benefit that can be provided
from the participant's vested account.
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
PAYMENT OF BENEFITS
Upon retirement, disability, death, or termination of employment, the total
vested value of a participant's account is distributed to the participant or the
beneficiary in cash unless the participant or the beneficiary elects certain
other forms of distribution available under the Plan. A participant's
contributions may also be withdrawn for certain hardship situations.
PARTICIPANT LOANS
Participants may borrow from their fund accounts a minimum of $1,000 up to a
maximum equal to the lesser of $50,000 or one-half of the participant's vested
account balance. Loan terms range from 1-5 years or up to 10 years for the
purchase of a primary residence. The loans are secured by the balance in the
participant's account and bear interest at a rate commensurate with local
prevailing rates as determined by the plan administrator. Interest rates ranged
from 8.5% to 9.5% in 2000 and 7.75% to 8.50% for 1999. Principal and interest
are paid ratably through payroll deductions.
VESTING AND FORFEITURES
Participants are immediately 100% vested in their Salary Deferral Contributions,
Employee Voluntary Contributions, Employee Voluntary Matching Contribution
Allocations, Unilateral Employer Contributions, rollover contributions plus
investment earnings arising from these contributions. Salary Deferral Matching
Contribution Allocations, ESOP Contributions, Profit Sharing Contributions and
certain accounts transferred from HCA-sponsored benefit plans are subject to a
vesting schedule based on the participant's number of years of service as
follows:
YEARS OF SERVICE VESTED PERCENTAGE
----------------------------------------------------------------
Less than 3 years 0%
3 years but less than 4 20%
4 years but less than 5 40%
5 years but less than 6 60%
6 years but less than 7 80%
7 years or more 100%
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
1. DESCRIPTION OF THE PLAN (CONTINUED)
VESTING AND FORFEITURES (CONTINUED)
Participants' interest in their accounts become 100% vested and nonforfeitable
without regard to their credited years of service if they are employed by the
Company on or after age 65, attain age 55 and have completed 10 years of
service, incur a total and permanent disability or die while employed by the
Company.
If a participant who is not fully vested terminated employment with the Company,
the participant is entitled to the vested portion of his/her account. The
nonvested portion is forfeited and is used to reduce future Company
contributions, pay administrative expenses of the Plan or is reallocated to
participants of the Plan, if forfeitures from ESOP accounts occur.
PLAN TERMINATION
Although it has not expressed any intent to do so, the Company has the right
under the Plan to discontinue its contributions at any time and to terminate the
Plan subject to provisions of ERISA. In the event of Plan termination,
participants will receive the vested and non-vested portions of their accounts.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
BASIS OF ACCOUNTING
The financial statements of the Plan are prepared on the accrual basis of
accounting.
USE OF ESTIMATES
The preparation of financial statements in conformity with accounting principles
generally accepted in the United States requires management to make estimates
that affect amounts reported in the financial statements and accompanying notes.
Actual results could differ from those estimates.
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)
INVESTMENT VALUATION AND INCOME RECOGNITION
The Plan's investments are held and transactions are executed by U.S. Trust
Company, N.A., (the "ESOP Trustee"), for the ESOP portion of the Plan and by
Northern Trust Company (the "Trustee") for the non-ESOP portion of the Plan.
Investments in collective trust funds and equity securities are stated at fair
value by the ESOP Trustee and the Trustee and are based on quoted prices in an
active market. Securities traded on a national securities exchange are valued at
the last reported sales price on the last business day of the Plan year.
Participant loans are valued at fair value, which is approximated by cost.
Purchases and sales of securities are recorded on a trade-date basis. Interest
income is recorded on the accrual basis. Dividends are recorded on the
ex-dividend date.
ADMINISTRATIVE EXPENSES
Administrative expenses, including legal and participant accounting, and all
expenses directly relating to the investments are charged to and paid by the
Plan unless paid by the Company.
BENEFIT PAYMENTS
Benefits are recorded when paid.
3. INVESTMENTS
For the year ended December 31, 2000 and the period from May 11, 1999 (date of
inception) to December 31, 1999, the Plan's investments (including investments
purchased, sold as well as held during the year) appreciated (depreciated) in
fair value as determined by quoted market prices as follows:
PERIOD FROM MAY 11,
1999 (DATE OF
YEAR ENDED INCEPTION) TO
DECEMBER 31, DECEMBER 31,
2000 1999
-----------------------------------
Common stock $ 131,025,036 $ 8,996,043
Shares of Registered Investment Companies (3,333,784) 9,053,834
-----------------------------------
$ 127,691,252 $ 18,049,877
===================================
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
4. INVESTMENTS
The fair value of individual investments that represent 5% or more of the Plan's
net assets at December 31, 2000 and 1999 are as follows:
DECEMBER 31,
2000 1999
--------------------------------
LifePoint Hospitals, Inc. Common Stock* $143,183,566 $34,172,818
HCA - The Healthcare Company Common Stock 53,421,098 41,017,714
Northern Trust Company Stock Index Fund 33,086,564 36,466,230
Northern Trust Company Stable Value Asset Fund 28,356,600 25,864,004
Northern Trust Company Small Company Index Fund 15,399,544 14,846,168
Northern Trust Company International Equity Index Fund 6,911,373 8,067,250
*Includes non-participant directed investments
5. NONPARTICIPANT-DIRECTED INVESTMENTS
Information about net assets and the significant components of the changes in
net assets relating to the nonparticipant-directed investment in LifePoint
Hospitals, Inc. common stock at December 31, 2000 and 1999 are as follows:
ALLOCATED UNALLOCATED TOTAL
-----------------------------------------------
December 31, 2000:
Number of shares 312,767 2,441,198 2,753,965
===============================================
Fair value $ 16,008,624 $ 122,365,050 $138,373,674
===============================================
December 31, 1999
Number of shares 61,300 2,735,419 2,796,719
===============================================
Fair value $ 724,461 $ 32,311,783 $ 33,036,244
===============================================
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
5. NONPARTICIPANT-DIRECTED INVESTMENTS (CONTINUED)
MAY 11, 1999
THROUGH
DECEMBER 31, DECEMBER 31,
2000 1999
------------------------------
Change in net assets:
Balance beginning of period $ 33,036,244 $ --
ESOP shares purchased through the issuance of
the ESOP Note -- 32,162,266
Distributions to participants (1,108,502) --
Unrealized appreciation in fair value 106,445,932 873,978
------------------------------
$ 138,373,674 $33,036,244
==============================
6. NOTE PAYABLE TO LIFEPOINT HOSPITALS, INC.
On June 9, 1999, the Plan purchased 2,796,719 shares of the Company's common
stock from the Company at $11.50 per share for an aggregate purchase price of
approximately $32,162,000. The Plan funded the stock purchase through the
issuance of a note payable to the Company (the "ESOP Note") equal to the
purchase price. The ESOP Note is secured by a pledge of the unallocated stock
held by the trust. Terms of the ESOP Note call for repayment in ten annual
payments of $4,636,517, which includes interest on the outstanding principal
balance at an annual rate of 8%.
The purchased shares are held by the ESOP Trustee in a suspense account and a
portion of these shares is allocated on a quarterly and annual basis. Through
December 31, 2000 and 1999, 355,521 and 61,300, respectively, shares have been
allocated to participant accounts.
The price paid for the purchase of the Company's common stock was acknowledged
to be no greater than the prevailing price of the Company's common stock quoted
on NASDAQ at June 9, 1999. The Company makes contributions in cash to the Plan,
which when aggregated with the Plan's dividends and interest earnings, equal the
amount necessary to enable the Plan to make regularly scheduled payments of
principal and interest due on the ESOP Note. Based on this determination, and
subject to limitations contained in the Code, the Company is entitled to claim
an income tax deduction for contributions to the Plan for the year to which such
contributions relate. The participants
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LifePoint Hospitals, Inc. Retirement Plan
Notes to Financial Statements (continued)
6. NOTE PAYABLE TO LIFEPOINT HOSPITALS, INC. (CONTINUED)
and beneficiaries of the Plan are not subject to income tax with respect to
contributions made on their behalf until they receive distributions from the
Plan.
The scheduled amortization of the ESOP Note for the next five years and
thereafter is as follows:
2001 $ 3,952,092
2002 2,705,363
2003 2,921,792
2004 3,155,535
2005 3,407,978
Thereafter 11,948,753
----------------
$ 28,091,513
================
7. INCOME TAX STATUS
The Plan has received a determination letter from the Internal Revenue Service
dated August 4, 1999, stating that the Plan is qualified under Section 401(a) of
the Code and, therefore, the related trust is exempt from taxation. The Plan has
been amended since receiving the determination letter. Once qualified, the Plan
is required to operate in conformity with the Code to maintain its
qualification. The Company believes the Plan is being operated in compliance
with the applicable requirements of the Code and therefore, believes that the
Plan is qualified and the related trust is tax exempt.
8. PARTY-IN-INTEREST TRANSACTIONS
Transactions with parties-in-interest include the issuance of the ESOP Note
payable to the Company for the purchase of the Company's common stock and
contributions received by the Plan from the Company to fund principal and
interest payments on the ESOP Note. Certain Plan investments are shares of trust
funds managed by the Trustee and therefore, such transactions qualify as
party-in-interest.
Party-in-interest transactions also include purchases and sales of assets
through the ESOP Trustee and Trustee.
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LifePoint Hospitals, Inc. Retirement Plan
EIN: 52-2165845 Plan No.: 001
Schedule H Line 4i
Schedule of Assets (Held at End of Year)
December 31, 2000
(C) DESCRIPTION OF INVESTMENT
INCLUDING MATURITY DATE, RATE OF
(B) IDENTITY OF ISSUE, BORROWER INTEREST, COLLATERAL, PAR OR (E) CURRENT
(A) OR SIMILAR PARTY MATURITY VALUE (D) COST VALUE
------------------------------------------------------------------------------------------------------------------
* Northern Trust Company Stable Value Asset Fund # $ 28,356,600
* Northern Trust Company Aggregate Bond Index Fund # 5,872,191
* Northern Trust Company Stock Index Fund # 33,086,564
* Northern Trust Company Small Company Index Fund # 15,399,544
* Northern Trust Company International Equity Index Fund # 6,911,373
* Northern Trust Company Short Term Investment Fund # 342,005
* LifePoint Hospitals, Inc. Common Stock $34,654,982 143,183,566
HCA - The Healthcare Company Common Stock # 53,421,098
Triad Hospitals, Inc. Common Stock # 1,875,926
Participant Loans Interest rate ranges from 8.5% to 9.5% # 2,853,886
----------------
$ 291,302,753
================
*Indicates a party-in-interest to the Plan.
#Not necessary as this is participant-directed.
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SIGNATURES
The Plan. Pursuant to the requirements of the Securities Exchange Act of
1934, the trustees (or other persons who administer the employee benefit plan)
have duly caused this annual report to be signed on its behalf by the
undersigned hereunto duly authorized.
LifePoint Hospitals, Inc. Retirement Plan
Date: June 29, 2001 /s/ Kenneth C. Donahey
--------------------------------------------
Kenneth C. Donahey
Chairman & Chief Executive Officer
16
EXHIBIT INDEX
Exhibit Description
------- -----------
23 Independent Auditors' Consent