Cleveland Clinic Health System Obligated Group - FMSbonds.com
Cleveland Clinic Health System Obligated Group - FMSbonds.com Cleveland Clinic Health System Obligated Group - FMSbonds.com
To facilitate subsequent transfers, all Series 2008A Bonds deposited by Direct Participants with DTC areregistered in the name of DTC’s partnership nominee, Cede & Co. or such other name as may be requested by anauthorized representative of DTC. The deposit of the Series 2008A Bonds with DTC and their registration in thename of Cede & Co. or such other DTC nominee does not effect any change in beneficial ownership. DTC has noknowledge of the actual Beneficial Owners of the Series 2008A Bonds; DTC’s records reflect only the identity ofthe Direct Participants to whose accounts such Series 2008A Bonds are credited, which may or may not be theBeneficial Owners. The Direct and Indirect Participants will remain responsible for keeping account of theirholdings on behalf of their customers.Conveyance of notices and other communications by DTC to Direct Participants, by Direct Participants toIndirect Participants, and by Direct Participants and Indirect Participants to Beneficial Owners will be governed byarrangements among them, subject to any statutory or regulatory requirements as may be in effect from time to time.Redemption notices will be sent to DTC. If less than all the Series 2008A Bonds and, where applicable, ofa particular maturity are being redeemed, DTC’s practice is to determine by lot the amount of the interest of eachDirect Participant in such issue to be redeemed.Neither DTC nor Cede & Co. (nor such other DTC nominee) will consent or vote with respect to the Series2008A Bonds unless authorized by a Direct Participant in accordance with DTC’s procedures. Under its usualprocedures, DTC mails an Omnibus Proxy to the Bond Trustee as soon as possible after the record date. TheOmnibus Proxy assigns Cede & Co.’s consenting or voting rights to those Direct Participants to whose accounts theSeries 2008A Bonds are credited on the record date (identified in a listing attached to the Omnibus Proxy).Principal, purchase price, premium and interest payments on the Series 2008A Bonds will be made to Cede& Co., or such other nominee as may be requested by an authorized representative of DTC. DTC’s practice is tocredit Direct Participants’ accounts upon DTC’s receipt of funds and corresponding detail information from theBond Trustee, on the payable date in accordance with their respective holdings as shown on DTC’s records.Payments by Participants to Beneficial Owners will be governed by standing instructions and customary practices,as is the case with securities held for the accounts of customers in bearer form or registered in “street name,” andwill be the responsibility of such Participant and not of DTC (nor its nominee), the Bond Trustee, the Borrower, theCleveland Clinic or the Commission, subject to any statutory or regulatory requirements as may be in effect fromtime to time. Payment of principal, purchase price, premium and interest to Cede & Co. (or such other nominee asmay be requested by an authorized representative of DTC) is the responsibility of the Bond Trustee, disbursement ofsuch payments to Direct Participants will be the responsibility of DTC, and disbursement of such payments to theBeneficial Owners will be the responsibility of Direct and Indirect Participants.TendersA Beneficial Owner shall give notice to elect to have its Series 2008A Bonds purchased or tendered,through its Participant, to the Bond Trustee, and shall effect delivery of such Series 2008A Bonds by causing theDirect Participant to transfer the Participant’s interest in such Series 2008A Bonds, on DTC’s records, to the BondTrustee. The requirement for physical delivery of Series 2008A Bonds in connection with a demand for purchase ora mandatory purchase will be deemed satisfied when the ownership rights in the Series 2008A Bonds are transferredby Direct Participants on DTC’s records and followed by a book entry credit to the Bond Trustee.Discontinuance of DTC ServicesDTC may discontinue providing its services as securities depository with respect to the Series 2008ABonds at any time by giving notice to the Commission and Bond Trustee. Under such circumstances, in the eventthat a successor securities depository is not obtained, bond certificates are required to be authenticated anddelivered.The Commission may, as provided in the Bond Indenture, decide to discontinue use of the system of bookentrytransfers through DTC (or a successor securities depository). In that event, bond certificates will beauthenticated and delivered for the Series 2008A Bonds.12
Use of Certain Terms in Other Sections of the Offering CircularIn reviewing this Offering Circular it should be understood that while the Series 2008A Bonds are in theBook-Entry System, reference in other sections of this Offering Circular to owners of such Series 2008A Bondsshould be read to include any person for whom a Participant acquires an interest in Series 2008A Bonds, but (i) allrights of ownership, as described herein, must be exercised through DTC and the Book-Entry System and (ii) noticesthat are to be given to registered owners by the Bond Trustee will be given only to DTC. DTC is required toforward (or cause to be forwarded) the notices to the Participants by its usual procedures so that such Participantsmay forward (or cause to be forwarded) such notices to the Beneficial Owners.None of the Commission, the Borrower, the Cleveland Clinic, the Underwriter or the Bond Trusteehas any responsibility or obligation to any DTC Participant or any Beneficial Owner with respect to: (1) theaccuracy of any records maintained by DTC or any Participant; (2) the payment by DTC or any Participantof any amount due to any Beneficial Owner in respect of the principal or purchase price of, or interest or anypremium on the Series 2008A Bonds; (3) the delivery by DTC or any Participant to any Beneficial Owner ofany notice (including a notice of redemption) or other communication which is required or permitted to begiven to Bondholders under the Bond Indenture; (4) the selection of the Beneficial Owners to receive paymentin the event of a partial redemption of the Series 2008A Bonds; or (5) any consent given or other action takenby DTC as Bondholder.THE COMMISSIONThe Ohio Higher Educational Facility Commission is a body both corporate and politic constituting anagency and instrumentality of the State. It was created in 1968 by, and exists under, Chapter 3377 of the OhioRevised Code. Under Chapter 140 of the Revised Code, the State, as a “public hospital agency” and acting by andthrough the Commission as its “governing body” for this purpose, may issue revenue bonds to pay costs of “hospitalfacilities” for the benefit of “nonprofit hospital agencies”, such as the Cleveland Clinic. Those revenue bonds areauthorized by a resolution of the Commission. The revenue bonds are not general obligations, debt, or bondedindebtedness of the State or any other public hospital agency. The holders or owners of the bonds are not given theright, and have no right, to have excises or taxes levied by a public hospital agency for the payment of bond servicecharges thereon, and each such bond shall bear on its face a statement to that effect and to the effect that the right tosuch payment is limited to the hospital receipts and special funds pledged to such purpose under the bondproceedings. The State, as a public hospital agency and acting by and through the Commission, may lease hospitalfacilities to or from a nonprofit hospital agency, such as the Cleveland Clinic, for such uses, and upon such termsand conditions, as are agreed upon by the parties, in accordance with Chapter 140 of the Revised Code.The Commission consists of nine members including the Chancellor of the Ohio Board of Regents or adesignee of the Chancellor, an ex officio member. The other eight members are appointed to overlapping eight-yearterms by the Governor with the advice and consent of the State Senate. The Chairman is designated by theGovernor, and the other officers, including the Vice Chairman, the Secretary and the Deputy Secretary are electedby the members from their own number. The members of the Commission receive no compensation for theirservices but are entitled to reimbursement for their actual and necessary expenses. The Commission’s office islocated in Columbus, Ohio. The Commission does not have any employees. The Ohio Board of Regents providesstaffing assistance to the Commission when necessary.Limited Obligations of the StateSECURITY FOR THE SERIES 2008A BONDSThe Bond Service Charges on the Series 2008A Bonds are payable from the Hospital Receipts, includingprimarily the Basic Rent paid by the Cleveland Clinic to the Commission under the State Financing Lease, and themoney, securities and funds and accounts to be held by the Bond Trustee (including investment earnings) availablefor that purpose under the Bond Indenture. All series of Bonds issued under the Bond Indenture, including theSeries 2008A Bonds, are issued on a parity basis.13
- Page 1 and 2: NEW ISSUEBOOK ENTRY ONLYSee “RATI
- Page 3 and 4: TABLE OF CONTENTSINTRODUCTORY STATE
- Page 5 and 6: OFFERING CIRCULARRelating to$452,34
- Page 7 and 8: Security and Sources of Payment for
- Page 9 and 10: Upon issuance of the Series 2008A B
- Page 11 and 12: (ii) acquisition of magnetic resona
- Page 13 and 14: $147,200,000 Term Bonds Due January
- Page 15: that the redemption is conditional
- Page 19 and 20: County BondsThe Cleveland Clinic an
- Page 21 and 22: The Cleveland Clinic regularly revi
- Page 23 and 24: ESTIMATED SOURCES AND USES OF FUNDS
- Page 25 and 26: DEBT SERVICE COVERAGEThe following
- Page 27 and 28: MedicareGeneralApproximately 29% of
- Page 29 and 30: there is no assurance that the Obli
- Page 31 and 32: Medicare Conditions of Participatio
- Page 33 and 34: fiscal year’s budget that are in
- Page 35 and 36: Federal Regulatory and Contractual
- Page 37 and 38: Stark-type statutes have fewer exce
- Page 39 and 40: party or for any services rendered
- Page 41 and 42: typically in a position to refer pa
- Page 43 and 44: OhioOhio Certificate of Need Progra
- Page 45 and 46: performance demonstration programs
- Page 47 and 48: manifest injustice would otherwise
- Page 49 and 50: and properties owned or operated by
- Page 51 and 52: plan of reorganization, with one ex
- Page 53 and 54: percentage may be composed wholly o
- Page 55 and 56: The Internal Revenue Service Form 9
- Page 57 and 58: Charity Care, Underinsured and Unin
- Page 59 and 60: • Proposals to eliminate the tax-
- Page 61 and 62: acting in the capacity of underwrit
- Page 63 and 64: Frederick R. Nance, Regional Managi
- Page 65 and 66: FINANCIAL POSITION — D. BALANCE S
Use of Certain Terms in Other Sections of the Offering CircularIn reviewing this Offering Circular it should be understood that while the Series 2008A Bonds are in theBook-Entry <strong>System</strong>, reference in other sections of this Offering Circular to owners of such Series 2008A Bondsshould be read to include any person for whom a Participant acquires an interest in Series 2008A Bonds, but (i) allrights of ownership, as described herein, must be exercised through DTC and the Book-Entry <strong>System</strong> and (ii) noticesthat are to be given to registered owners by the Bond Trustee will be given only to DTC. DTC is required toforward (or cause to be forwarded) the notices to the Participants by its usual procedures so that such Participantsmay forward (or cause to be forwarded) such notices to the Beneficial Owners.None of the Commission, the Borrower, the <strong>Cleveland</strong> <strong>Clinic</strong>, the Underwriter or the Bond Trusteehas any responsibility or obligation to any DTC Participant or any Beneficial Owner with respect to: (1) theaccuracy of any records maintained by DTC or any Participant; (2) the payment by DTC or any Participantof any amount due to any Beneficial Owner in respect of the principal or purchase price of, or interest or anypremium on the Series 2008A Bonds; (3) the delivery by DTC or any Participant to any Beneficial Owner ofany notice (including a notice of redemption) or other <strong>com</strong>munication which is required or permitted to begiven to Bondholders under the Bond Indenture; (4) the selection of the Beneficial Owners to receive paymentin the event of a partial redemption of the Series 2008A Bonds; or (5) any consent given or other action takenby DTC as Bondholder.THE COMMISSIONThe Ohio Higher Educational Facility Commission is a body both corporate and politic constituting anagency and instrumentality of the State. It was created in 1968 by, and exists under, Chapter 3377 of the OhioRevised Code. Under Chapter 140 of the Revised Code, the State, as a “public hospital agency” and acting by andthrough the Commission as its “governing body” for this purpose, may issue revenue bonds to pay costs of “hospitalfacilities” for the benefit of “nonprofit hospital agencies”, such as the <strong>Cleveland</strong> <strong>Clinic</strong>. Those revenue bonds areauthorized by a resolution of the Commission. The revenue bonds are not general obligations, debt, or bondedindebtedness of the State or any other public hospital agency. The holders or owners of the bonds are not given theright, and have no right, to have excises or taxes levied by a public hospital agency for the payment of bond servicecharges thereon, and each such bond shall bear on its face a statement to that effect and to the effect that the right tosuch payment is limited to the hospital receipts and special funds pledged to such purpose under the bondproceedings. The State, as a public hospital agency and acting by and through the Commission, may lease hospitalfacilities to or from a nonprofit hospital agency, such as the <strong>Cleveland</strong> <strong>Clinic</strong>, for such uses, and upon such termsand conditions, as are agreed upon by the parties, in accordance with Chapter 140 of the Revised Code.The Commission consists of nine members including the Chancellor of the Ohio Board of Regents or adesignee of the Chancellor, an ex officio member. The other eight members are appointed to overlapping eight-yearterms by the Governor with the advice and consent of the State Senate. The Chairman is designated by theGovernor, and the other officers, including the Vice Chairman, the Secretary and the Deputy Secretary are electedby the members from their own number. The members of the Commission receive no <strong>com</strong>pensation for theirservices but are entitled to reimbursement for their actual and necessary expenses. The Commission’s office islocated in Columbus, Ohio. The Commission does not have any employees. The Ohio Board of Regents providesstaffing assistance to the Commission when necessary.Limited Obligations of the StateSECURITY FOR THE SERIES 2008A BONDSThe Bond Service Charges on the Series 2008A Bonds are payable from the Hospital Receipts, includingprimarily the Basic Rent paid by the <strong>Cleveland</strong> <strong>Clinic</strong> to the Commission under the State Financing Lease, and themoney, securities and funds and accounts to be held by the Bond Trustee (including investment earnings) availablefor that purpose under the Bond Indenture. All series of Bonds issued under the Bond Indenture, including theSeries 2008A Bonds, are issued on a parity basis.13
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