Long-Term Debt

12 Months Ended

Dec. 31, 2020

NOTE 9 — LONG-TERM DEBT

A summary of long-term debt at December 31, including related interest rates at December 31, 2020, follows (dollars in millions):


	2020			2019
Senior secured asset-based revolving credit facility	$	—		$	2,480
Senior secured revolving credit facility		—			—
Senior secured 364-day term loan facility		—			—
Senior secured term loan facilities (effective interest rate of 2.8%)		3,671			3,725
Senior secured notes (effective interest rate of 5.1%)		13,850			13,850
Other senior secured debt (effective interest rate of 4.7%)		767			654

Senior secured debt		18,288			20,709
Senior unsecured notes (effective interest rate of 5.5%)		12,952			13,252
Net debt issuance costs		(236	)		(239	)

Total debt (average life of 8.9 years, rates averaging 5.0%)		31,004			33,722
Less amounts due within one year		209			145

	$	30,795		$	33,577

During February 2020, we issued $2.700 billion aggregate principal amount of 3.50% senior notes due 2030. During March 2020, we used the net proceeds for the redemption of all $1.000 billion outstanding aggregate principal amount of HCA Healthcare, Inc.’s 6.25% senior notes due 2021 and, together with available funds, for the redemption of all $2.000 billion outstanding aggregate principal amount of HCA Inc.’s 7.50% senior notes due 2022. The pretax loss on retirement of debt was $295 million.

During March 2020 in response to the risks the COVID-19 pandemic presents to our business, we entered into a credit agreement that provides for a 364-day secured term loan facility for an aggregate principal amount of up to $2.000

billion. As of December 31, 2020 there was no amount outstanding or draw notices pending under the facility. We terminated this credit agreement during January 2021.

Senior Secured Credit Facilities And Other Senior Secured Debt

We have entered into the following senior secured credit facilities:

(i) a $3.750

billion asset-based revolving credit facility maturing on

June 28, 2022

with a borrowing base of

85%

of eligible accounts receivable, subject to customary reserves and eligibility criteria

(none

outstanding at December 31, 2020) (the “ABL credit facility”); (ii) a $2.000 billion senior secured revolving credit facility maturing on June 28, 2022 (none

outstanding at December 31, 2020 without giving effect to certain outstanding letters of credit); (iii) a

$2.000

billion senior secured 364-day term loan facility maturing on March 18, 2021 (none

outstanding at December 31, 2020 and

the

facility was

terminated during January 2021); (iv) a

$1.078

billion senior secured term loan A-6 facility maturing on

July 16, 2024; (v) a $1.459

billion senior secured term loan B-12 facility maturing on

March 13, 2025; and (vi) a $1.134

billion senior secured term loan B-13 facility maturing on

March 18, 2026.

We refer to the facilities described under (ii) through (vi) above, collectively, as the “cash flow credit facility” and, together with the ABL credit facility, the “senior secured credit facilities.”

Borrowings under the senior secured credit facilities bear interest at a rate equal to, at our option, either (a) a base rate determined by reference to the higher of (1) the federal funds rate plus 0.50% or (2) the prime rate of Bank of America or (b) a LIBOR rate for the currency of such borrowing for the relevant interest period, plus, in each case, an applicable margin. The applicable margin for borrowings under the senior secured credit facilities may be reduced subject to attaining certain leverage ratios.

The senior secured credit facilities contain a number of covenants that restrict, subject to certain exceptions, our (and some or all of our subsidiaries’) ability to incur additional indebtedness, repay subordinated indebtedness, create liens on assets, sell assets, make investments, loans or advances, engage in certain transactions with affiliates, pay dividends and distributions, and enter into sale and leaseback transactions. In addition, we are required to satisfy and maintain a maximum total leverage ratio covenant under the cash flow credit facility and, in certain situations under the ABL credit facility, a minimum interest coverage ratio covenant.

Senior secured notes consists of (i) $1.250 billion aggregate principal amount of 4.75% first lien notes due 2023; (ii) $2.000 billion aggregate principal amount of 5.00% first lien notes due 2024; (iii) $1.400 billion aggregate principal amount of 5.25% first lien notes due 2025; (iv) $1.500 billion aggregate principal amount of 5.25% first lien notes due 2026; (v) $1.200 billion aggregate principal amount of 4.50% first lien notes due 2027; (vi) $2.000 billion aggregate principal amount of 4 1/8% first lien notes due 2029; (vii) $1.000 billion aggregate principal amount of 5 1/8% first lien notes due 2039; (viii) $1.500 billion aggregate principal amount of 5.50% first lien notes due 2047; and (ix) $2.000 billion aggregate principal amount of 5 1/4% first lien notes due 2049. Finance leases and other secured debt totaled $767 million at December 31, 2020.

We use interest rate swap agreements to manage the variable rate exposure of our debt portfolio. At December 31, 2020, we had entered into effective interest rate swap agreements, in a total notional amount of $2.500 billion, in order to hedge a portion of our exposure to variable rate interest payments associated with the senior secured credit facilities. The effect of the interest rate swaps is reflected in the effective interest rates for the senior secured credit facilities.

Senior Unsecured Notes

Senior unsecured notes consist of (i) $12.091 billion aggregate principal amount of senior notes with maturities ranging from 2023 to 2033; (ii) an aggregate principal amount of $125 million medium-term notes maturing 2025; and (iii) an aggregate principal amount of $736 million debentures with maturities ranging from 2023 to 2095.

General Debt Information

The senior secured credit facilities and senior secured notes are fully and unconditionally guaranteed by substantially all existing and future, direct and indirect, 100% owned material domestic subsidiaries that are “Unrestricted Subsidiaries” under our Indenture (the “1993 Indenture”) dated December 16, 1993 (except for certain special purpose subsidiaries that only guarantee and pledge their assets under our ABL credit facility).

All obligations under the ABL credit facility, and the guarantees of those obligations, are secured, subject to permitted liens and other exceptions, by a first-priority lien on substantially all of the receivables of the borrowers and each guarantor under such ABL credit facility (the “Receivables Collateral”).

All obligations under the cash flow credit facility and the guarantees of such obligations are secured, subject to permitted liens and other exceptions, by:

•

a first-priority lien on the capital stock owned by HCA Inc., or by any guarantor, in each of their respective first-tier subsidiaries;

•

a first-priority lien on substantially all present and future assets of HCA Inc. and of each guarantor other than (i) “Principal Properties” (as defined in the 1993 Indenture), (ii) certain other real properties and (iii) deposit accounts, other bank or securities accounts, cash, leaseholds, motor-vehicles and certain other exceptions; and

•

a second-priority lien on certain of the Receivables Collateral.

Our senior secured notes and the related guarantees are secured by first-priority liens, subject to permitted liens, on our and our subsidiary guarantors’ assets, subject to certain exceptions, that secure our cash flow credit facility on a first-priority basis and are secured by second-priority liens, subject to permitted liens, on our and our subsidiary guarantors’ assets that secure our ABL credit facility on a first-priority basis and our other cash flow credit facility on a second-priority basis.

Maturities of long-term debt in years 2022 through 2025 are $233 million, $2.799 billion, $3.163 billion and $5.872 billion, respectively.