Cleveland Clinic Health System Obligated Group - FMSbonds.com

Indenture and on any outstanding Master Notes, and other entities may become Obligated Issuers and jointly andseverally liable under the Master Trust Indenture, including with respect to Master Notes previously or thereafterissued under the Master Trust Indenture, all as provided in the Master Trust Indenture. See “APPENDIX C —SUMMARY OF BASIC DOCUMENTS — The Master Trust Indenture — The Combined Group.” The ClevelandClinic has covenanted, however, that it will not withdraw from the Obligated Group as long as the Series 2008ABonds are outstanding.The Huntington National Bank, Columbus, Ohio, is acting as bond trustee and paying agent with respect tothe Series 2008A Bonds, as bond trustee for the Variable Rate Bonds (as hereinafter defined) and as Master Trusteeunder the Master Trust Indenture. The Huntington National Bank also serves as bond trustee (in such capacity, the“County Bond Trustee”) under the Bond Indenture dated as of June 15, 1987, as amended and supplemented (the“County Bond Indenture”), pursuant to which certain outstanding revenue bonds to be refunded by a portion of theSeries 2008A Bonds were issued by the County of Cuyahoga, Ohio (the “County”).See “APPENDIX A — PART II. OBLIGATED GROUP” for a description of the Obligated Issuers, theirfacilities and their operations. APPENDIX B also includes certain audited financial statements of the ClevelandClinic and its controlled affiliates, including the other Obligated Issuers and certain other corporations that are notObligated Issuers (collectively, the “Cleveland Clinic Health System”).Although the Cleveland Clinic, CCHS- East Region, Fairview, Lutheran, Marymount and Florida Clinic arethe only Obligated Issuers under the Master Trust Indenture, the Cleveland Clinic controls several other entities thatoperate health care facilities. See “APPENDIX A — PART V. NON-OBLIGATED HEALTH SYSTEMPARTICIPANTS.”Concurrent IssuesConcurrent with the issuance of the Series 2008A Bonds, the State is expected to issue, acting by andthrough the Commission, its $670,000,000 Hospital Revenue Bonds, Series 2008B (Cleveland Clinic Health SystemObligated Group) in one or more series or subseries (collectively, the “Variable Rate Bonds” and, together with theSeries 2008A Bonds, the “Series 2008 Bonds”) to provide additional financing for the purposes for which the Series2008A Bonds are being issued. The Variable Rate Bonds will bear interest at variable rates of interest per year,including, initially, daily, weekly and commercial paper rates. The Variable Rate Bonds will be subject to optionaltender at the option of their holders, as well as mandatory tender under certain circumstances. The payment of theprincipal of and interest on the Variable Rate Bonds, and the purchase price for optionally or mandatorily tenderedVariable Rate Bonds, will be the obligation of the Cleveland Clinic under the State Financing Lease and of eachObligated Issuer under a promissory note to be issued under the Master Trust Indenture to secure that obligation andthe obligation of the Cleveland Clinic to make payments under the State Financing Lease in amounts and at timessufficient to pay Bond Service Charges on the Variable Rate Bonds (the “Variable Rate Note”). No liquidity facilityfrom a financial institution will be available to make any payment of such purchase price. The Variable Rate Bondswill be issued pursuant to and secured on a parity basis with the Series 2008A Bonds by the Bond Indenture.Use of ProceedsThe net proceeds of the Series 2008 Bonds, together with funds held by the Bond Trustee for the benefit ofthe hereinafter defined Bonds to be Refunded and the proceeds of the Variable Rate Bonds, will be used to (i) pay,or reimburse the Cleveland Clinic for the cost of acquiring, constructing, equipping and otherwise improving certainfacilities of the Cleveland Clinic and certain of its controlled affiliates, (ii) refund several series of outstandingrevenue bonds issued by the County under the County Bond Indenture (as hereinafter more particularly described,the “Bonds to be Refunded”) and (iii) pay costs relating to the issuance of the Series 2008 Bonds and the refundingof the Bonds to be Refunded. See “PLAN OF FINANCE” and “ESTIMATED SOURCES AND USES OFFUNDS.”2