Exhibit 10.13
SALE PARTICIPATION AGREEMENT
November 17, 2006
To: The Person whose name is
      set forth on the signature page hereof
Dear Sir or Madam:
          You have entered into an Exchange and Purchase Agreement with Hercules
Holding II, LLC, a Delaware limited liability company and the parent entity of
the Company (“Hercules Holding”), and/or a Management Stockholder’s Agreement,
dated as of the date hereof, between HCA Inc., a Delaware corporation (the
“Company”), and you (the “Stockholder’s Agreement”) relating to (i) Rollover
Stock (as defined in the Stockholder’s Agreement); (ii) Rollover Options (as
defined in the Stockholder’s Agreement); (iii) the purchase by you of Purchased
Stock (as defined in the Stockholder’s Agreement); and/or (iv) the grant by the
Company to you of new options (together with the Rollover Options, “Options”) to
purchase shares of common stock, par value $0.01 per share, of the Company
(“Common Stock”). The undersigned, Bain Capital Fund IX, L.P., KKR Millennium
Fund L.P., KKR 2006 Fund L.P. and ML Global Private Equity Fund, L.P. (each, an
“Investor” and, collectively, the “Investors”), who each hold interests in
Hercules Holding, hereby agree with you as follows, effective as of the Closing
Date (as defined in the Stockholder’s Agreement):
          1. (a) In the event that at any time on or after the Closing Date any
of the Investors (together with any of their respective affiliates, to the
extent provided for in Paragraph 9 hereof, the “Selling Investors”) proposes to
sell, directly or indirectly, for cash or any other consideration any shares of
Common Stock owned, directly or indirectly, by it, in any transaction other than
a Public Offering (as defined in the Stockholder’s Agreement) or a sale,
directly or indirectly, to an affiliate of the Selling Investors, then, unless
the Selling Investors are entitled to and do exercise the drag-along rights
pursuant to Paragraph 7 below and the Drag Transaction is consummated, solely to
the extent you are a Senior Management Stockholder (as defined in the
Stockholder’s Agreement) or the provisions hereof are otherwise applicable to
you pursuant to and in accordance with Section 11 of the Stockholder’s Agreement
or as a result of a decision by the Board (as defined in the Stockholder’s
Agreement), after consultation with the Chief Executive Officer of the Company,
to extend the rights under this Section 1 to you, the Selling Investors will
notify you or your Management Stockholder’s Estate or Management Stockholder’s
Trust (as such terms are defined in the Stockholder’s Agreement, and
collectively with you, the “Management Stockholder Entities”), as the case may
be, in writing (a “Notice”) of such proposed sale (a “Proposed Sale”) specifying
the principal terms and conditions of the Proposed Sale (the “Material Terms”)
including (A) the amount of Common Stock to be included in the Proposed Sale,
(B) the percentage of the outstanding Common Stock at the time the Notice is
given that is represented by the number of shares to be included in the Proposed
Sale, (C) the price per share of Common Stock subject to the Proposed Sale,
including a description of any pricing formulae and of any non-cash
consideration sufficiently detailed to permit valuation thereof, (D) the Tag
Along Sale Percentage of the initial Selling Investor and

--------------------------------------------------------------------------------

 

2

(E) the name and address of the Person (as defined in the Stockholder’s
Agreement) to whom the Offered Stock is proposed to be issued.
          (b) If, within 10 business days after the delivery of Notice under
Section 1(a), the Selling Investors receive from the Management Stockholder
Entities a written request (a “Request”) to include in the Proposed Sale an
amount of Common Stock held by the Management Stockholder Entities that does not
exceed the Tag Along Sale Percentage multiplied by the total number of shares of
Common Stock held by the Management Stockholder Entities in the aggregate (which
Request shall be irrevocable except (a) as set forth in clauses (c) and (d) of
this Section 1 below or (b) if otherwise mutually agreed to in writing by the
Management Stockholder Entities and the Selling Investor(s)), the Common Stock
held by you will be so included to the extent and as otherwise provided herein;
provided that only one Request, which shall be executed by the Management
Stockholder Entities, may be delivered with respect to any Proposed Sale for
Common Stock held by the Management Stockholder Entities. Promptly after the
execution of the Sale Agreement, the Selling Investors will furnish the
Management Stockholder Entities with a copy of the Sale Agreement, if any. For
purposes of this Section 1(b), the “Tag Along Sale Percentage” shall mean the
fraction, expressed as a percentage, determined by dividing the number of shares
of Common Stock to be purchased from the initial Selling Investor by the total
number of shares of Common Stock owned directly or indirectly by such initial
Selling Investor.
          (c) Notwithstanding anything to the contrary contained in this
Agreement, if any of the economic terms of the Proposed Sale change, including
without limitation if the per share price will be less than the per share price
disclosed in the Notice, or any of the other principal terms or conditions will
be materially less favorable to the selling Management Stockholder Entities than
those described in the Notice, the prospective Selling Investors will provide
written notice thereof to each Management Stockholder Entity who has made a
Request and each such Management Stockholder Entity will then be given an
opportunity to withdraw the offer contained in such holder’s Request (by
providing prompt (and in any event within five (5) business days; provided that,
notwithstanding the foregoing, if the proposed closing with respect to the
Proposed Sale is to occur within five (5) business days or less, no later than
three (3) business days prior to such closing) written notice of such withdrawal
to the Selling Investors), whereupon such withdrawing Management Stockholder
Entity will be released from all obligations thereunder.
          (d) If the Selling Investors do not complete the Proposed Sale by the
end of the 180th day following the date of the effectiveness of the Notice, each
selling Management Stockholder Entity may elect to be released from all
obligations under the applicable Request by notifying the Selling Investors in
writing of its desire to so withdraw. Upon receipt of that withdrawal notice,
the Notice of the relevant Management Stockholder Entities shall be null and
void, and it will then be necessary for a separate Notice to be furnished, and
the terms and provisions of clauses (a) and (b) of this Section 1 separately
complied with, in order to consummate such Proposed Sale pursuant to this
Section 1, unless the failure to complete such proposed sale resulted from any
failure by any selling Management Stockholder Entity to comply with the terms of
this Section 1.
          2. (a) The number of shares of Common Stock which the Management
Stockholder Entities will be permitted to include in a Proposed Sale pursuant to
a Request will be

--------------------------------------------------------------------------------

 

3

the lesser of (A) the number of shares of Common Stock such Management
Stockholder Entities have offered to sell in the Proposed Sale as set forth in
the Request and (B) the number of shares of Common Stock determined by
multiplying (i) the number of shares of Common Stock to be included in the
Proposed Sale by (ii) a fraction the numerator of which is the number of shares
of Common Stock owned by the Management Stockholder Entities plus all shares of
Common Stock which they are then entitled to acquire under any unexercised
portion of Options, to the extent such Option is then exercisable or would
become exercisable as a result of the consummation of the Proposed Sale, and the
denominator of which is the total number of shares of Common Stock owned by the
Management Stockholder Entities and all other Persons participating in such sale
as tag-along sellers pursuant to Other Management Stockholder Agreements (as
defined in the Stockholder’s Agreement) or other agreements (all such
participants, together with the Selling Investors, the “Tag Along Sellers”) plus
all shares of Common Stock which the Tag Along Sellers are then entitled to
acquire under any unexercised portion of Options, to the extent such Options are
then exercisable or would become exercisable as a result of the consummation of
the Proposed Sale, plus all shares of Common Stock owned by the Selling
Investors (the lesser of (A) or (B), the “Pro Rata Share”).
          (b) Any remaining shares of Common Stock subject to the Proposed Sale
that would be allocated to the Tag Along Sellers if each had offered to sell a
number of shares equal to the Tag Along Sale Percentage multiplied by the number
of shares of Common Stock held by it shall be allocated to each Tag Along Seller
in an amount up to the excess of (i) the Tag Along Sale Percentage multiplied by
the number of shares of Common Stock held by such Tag Along Seller over (ii) its
Pro Rata Share, or as the Tag Along Sellers and the Selling Investors and any
other Persons participating in such sale may otherwise agree.
          3. Except as may otherwise be provided herein, shares of Common Stock
subject to a Request will be included in a Proposed Sale pursuant hereto and in
any agreements with purchasers relating thereto on the same terms and subject to
the same conditions applicable to the shares of Common Stock which the Selling
Investors propose to sell (directly or indirectly) in the Proposed Sale (with
appropriate adjustments, as determined in good faith by the Selling Investors,
in the event that the Investors are proposing to transfer interests in Hercules
Holding). Such terms and conditions shall include, without limitation: the sale
price; the payment of fees, commissions and expenses; the provision of, and
customary representations and warranties as to, information reasonably requested
by the Selling Investors covering matters regarding the Management Stockholder
Entities’ ownership of shares; and the provision of requisite indemnification;
provided that any indemnification provided by the Management Stockholder
Entities shall be pro rata in proportion with the number of shares of Common
Stock to be sold; provided, further, that no Management Stockholder Entity shall
be required to indemnify any Person for an amount, in the aggregate, in excess
of the gross proceeds received in such Proposed Sale. Notwithstanding anything
to the contrary in the foregoing, if the consideration payable for shares of
Common Stock is securities and a Management Stockholder Entity is not able to
acquire such securities under U.S., foreign or state securities laws, such
Management Stockholder Entity shall be entitled to receive an amount in cash
equal to the value of any such securities such Person would otherwise be
entitled to receive.
          4. Upon delivering a Request, the Management Stockholder Entities
will, if requested by the Selling Investors, execute and deliver a custody
agreement and power of attorney in form and substance reasonably satisfactory to
the Selling Investors with respect to the shares of Common Stock which are to be
sold by the Management Stockholder Entities pursuant hereto (a “Custody
Agreement and Power of Attorney”). The Custody Agreement and Power of Attorney
will contain customary provisions and will provide, among other things, that the

--------------------------------------------------------------------------------

 

4

Management Stockholder Entities will deliver to and deposit in custody with the
custodian and attorney-in-fact named therein a certificate or certificates (if
such shares are certificated) representing such shares of Common Stock (duly
endorsed in blank by the registered owner or owners thereof) and irrevocably
appoint said custodian and attorney-in-fact as the Management Stockholder
Entities’ agent and attorney-in-fact with full power and authority to act under
the Custody Agreement and Power of Attorney on the Management Stockholder
Entities’ behalf with respect to the matters specified therein.
          5. The Management Stockholder Entities’ right pursuant hereto to
participate in a Proposed Sale shall be contingent on the Management Stockholder
Entities’ material compliance with each of the provisions hereof and the
Management Stockholder Entities’ respective willingness to execute such
documents in connection therewith as may be reasonably requested by the Selling
Investors.
          6. If the consideration to be paid in exchange for shares of Common
Stock in a Proposed Sale pursuant to Section 1 includes any securities, and the
receipt thereof by a Selling Investor and Management Shareholder Entity would
require under applicable law (a) the registration or qualification of such
securities or of any Person as a broker or dealer or agent with respect to such
securities or (b) the provision to any selling Management Shareholder Entity of
any information regarding the Company, its subsidiaries, such securities or the
issuer thereof that would not be required to be delivered in an offering solely
to a limited number of “accredited investors” under Regulation D promulgated
under the Securities Act of 1933, as amended, and the rules and regulations in
effect thereunder, such Selling Investor and Management Shareholder Entity shall
not, subject to the following sentence, have the right to sell shares of Common
Stock in such proposed sale. In such event, the Selling Investors shall have the
right to cause to be paid to such selling Management Shareholder Entity in lieu
thereof, against surrender of the shares of Common Stock which would have
otherwise been sold by such selling Management Shareholder Entity to the
prospective buyer in the proposed sale, an amount in cash equal to the Fair
Market Value (as defined in the Stockholder’s Agreement) of such shares of
Common Stock as of the date such securities would have been issued in exchange
for such shares of Common Stock.
          7. (a) If any of the Investors (together with their respective
affiliates) propose to transfer, directly or indirectly, a number of shares of
Common Stock equal to 50% or more of the Current Selling Investors Ownership
Share Number (such Person, the “Drag-Along Purchaser”), then if requested by the
Investors, the Management Stockholder Entities shall be required to sell a
number of shares of Common Stock equal to the aggregate number of shares of
Common Stock held by the Management Stockholder Entities (including shares of
Common Stock underlying exercisable Options) multiplied by a fraction, the
numerator of which is the number of shares of Common Stock proposed to be sold
(directly or indirectly) by the Investors (together with their respective
affiliates) and the denominator of which is the Current Selling Investors
Ownership Share Number (such transaction, a “Drag Transaction”).
     (b) Shares of Common Stock held by the Management Stockholder Entities
included in a Drag Transaction will be included in any agreements with the
Drag-Along Purchaser relating thereto on the same terms and subject to the same
conditions applicable to the shares of Common Stock which the Investors propose
to sell in the Drag Transaction (provided

--------------------------------------------------------------------------------

 

5

that appropriate adjustments, as determined in good faith by the Investors,
shall be made in the event the Investors are proposing to transfer interests in
Hercules Holding). Such terms and conditions shall include, without limitation:
the pro rata reduction of the number of shares of Common Stock to be sold by the
Investors and the Management Stockholder Entities to be included in the Drag
Transaction if required by the Drag-Along Purchaser; the sale price; the payment
of fees, commissions and expenses; the provision of, and representation and
warranty as to, information reasonably requested by the Investors covering
matters regarding the Management Stockholder Entities’ ownership of shares; and
the provision of requisite indemnification; provided that any indemnification
provided by the Management Stockholder Entities shall be pro rata in proportion
with the number of shares of Common Stock to be sold; provided, further, that no
Management Stockholder Entity shall be required to indemnify any Person for an
amount, in the aggregate, in excess of the proceeds received in such Proposed
Sale.
          (c) Your pro rata share of any amount to be paid pursuant to
Paragraph 3 or 7(b) shall be based upon the number of shares of Common Stock
intended to be transferred by the Management Stockholder Entities plus the
number of shares of Common Stock you would have the right to acquire under any
unexercised portion of the Option which is then vested or would become vested as
a result of the Proposed Sale or Drag Transaction, assuming that you receive a
payment in respect of such Option.
          (d) Notwithstanding anything to the contrary in the foregoing, if the
consideration payable for shares of Common Stock is securities and a Management
Stockholder Entity is not able to acquire such securities under U.S., foreign or
state securities laws, such Management Stockholder Entity shall be entitled to
receive an amount in cash equal to the value of any such securities such Person
would otherwise be entitled to receive.
          8. For purposes of this Agreement, the “Current Selling Investors
Ownership Share Number” shall mean the sum of (x) the product of (A) the
aggregate number of shares of Common Stock issued and outstanding as of the date
of the proposed Drag Transaction, as applicable, times (B) the Investors HoldCo
Ownership Percentage (as defined in the Stockholder’s Agreement) as of such date
(calculated, in the case of a Proposed Sale pursuant to Section 1, solely with
respect to the Selling Investors, and with respect to a Drag Transaction, with
respect to all of the Investors), times (C) the HoldCo Company Ownership
Percentage (as defined in the Stockholder’s Agreement) as of such date and
(y) the number of shares of Common Stock owned directly by the Selling Investors
(or all Investors, in the case of a Drag Transaction) and their respective
affiliates as of such date.
          9. The obligations of the Selling Investors hereunder shall extend
only to the Management Stockholder Entities and any transferees (“Permitted
Transferees”) who (a) are Other Management Stockholders (as defined in the
Stockholder’s Agreement), (b) are party to a Management Stockholder’s Agreement
with the Company and (c) have acquired Common Stock pursuant to a Permitted
Transfer (as defined in the Stockholder’s Agreement), and none of the Management
Stockholder Entities’ successors or assigns, with the exception of any Permitted
Transferee and only with respect to the Common Stock acquired by such Permitted
Transferee pursuant to a Permitted Transfer, shall have any rights pursuant
hereto.

--------------------------------------------------------------------------------

 

6

          10. If the Investors or any of them transfer, directly or indirectly,
any of their interests in the Company or Hercules Holding to an affiliate of any
of the Investors, such affiliate shall assume the obligations hereunder of the
Investors.
          11. This Agreement shall terminate and be of no further force and
effect on the occurrence of the earlier of the IPO (as defined in the
Stockholder’s Agreement) or a Change in Control.
          12. All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed effectively given: (a) upon
personal delivery to the party to be notified, (b) when sent by confirmed
facsimile if sent during normal business hours of the recipient, if not, then on
the next business day, (c) five (5) days after having been sent by registered or
certified mail, return receipt requested, postage prepaid or (d) one
(1) business day after deposit with a nationally recognized overnight courier,
specifying next day delivery, with written verification of receipt. All
communications shall be sent to such party’s address as set forth below or at
such other address or to such other person as the party shall have furnished to
each other party in writing in accordance with this provision:
          If to the Investors, to them at the following addresses:
Merrill Lynch Global Private Equity
Four World Financial Center, Floor 23
New York, NY 10080
Attention:    George A. Bitar
Telecopy:   (212) 449-1119
and
Bain Capital Partners, LLC
111 Huntington Avenue
Boston, MA 02199
Attention:   Chris Gordon
Telecopy:   (617) 516-2010
and
Kohlberg Kravis Roberts & Co. L.P.
2800 Sand Hill Road, Suite 200
Menlo Park, CA 94025
Attention:    James C. Momtazee
Telecopy:    (650) 233-6584
with copies to:
Hercules Holding II, LLC
c/o Merrill Lynch Global Private Equity
Four World Financial Center, Floor 23
New York, NY 10080

--------------------------------------------------------------------------------

 

7

Attention: George A. Bitar
Telecopy:   (212) 449-1119
and
Bain Capital Partners, LLC
111 Huntington Avenue
Boston, MA 02199
Attention:    Chris Gordon
Telecopy:    (617) 516-2010
and
Kohlberg Kravis Roberts & Co. L.P.
2800 Sand Hill Road, Suite 200
Menlo Park, CA 94025
Attention:    James C. Momtazee
Telecopy:    (650) 233-6584
and
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
Attention: David J. Sorkin, Esq.
Telecopy: (212) 455-2502
          If to the Company, to the Company at the following address:
HCA Inc.
One Park Plaza
Nashville, TN 37203
Attention: General Counsel
Telecopy: (615) 344-1531
with a copy to:
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017
Attention: David J. Sorkin, Esq.
Telecopy: (212) 455-2502
          If to you, to you at the address first set forth above herein;
          If to your Management Stockholder’s Estate or Management Stockholder’s
Trust, to the address provided to the Company by such entity.

--------------------------------------------------------------------------------

 

8

          13. The laws of the State of Delaware shall govern the interpretation,
validity and performance of the terms of this Agreement. In the event of any
controversy among the parties hereto arising out of, or relating to, this
Agreement which cannot be settled amicably by the parties, such controversy
shall be finally, exclusively and conclusively settled by mandatory arbitration
conducted expeditiously in accordance with the American Arbitration Association
rules, by a single independent arbitrator. Such arbitration process shall take
place in Nashville, Tennessee. The decision of the arbitrator shall be final and
binding upon all parties hereto and shall be rendered pursuant to a written
decision, which contains a detailed recital of the arbitrator’s reasoning.
Judgment upon the award rendered may be entered in any court having jurisdiction
thereof. Each party shall bear its own legal fees and expenses, unless otherwise
determined by the arbitrator; provided that if the Management Stockholder
substantially prevails on any of his or her substantive legal claims, then the
Investors shall reimburse all legal fees and arbitration fees incurred by the
Management Stockholder to arbitrate the dispute. Each party hereto hereby
irrevocably waives any right that it may have had to bring an action in any
court, domestic or foreign, or before any similar domestic or foreign authority
with respect to this Agreement.
          14. This Agreement may be executed in counterparts, and by different
parties on separate counterparts, each of which shall be deemed an original, but
all such counterparts shall together constitute one and the same instrument.
          15. It is the understanding of the undersigned that you are aware that
no Proposed Sale is contemplated and that such a sale may never occur.
          16. This Agreement may be amended by the Investors at any time upon
notice to the Management Stockholder thereof; provided that any amendment
(i) that materially disadvantages the Management Stockholder shall not be
effective unless and until the Management Stockholder has consented thereto in
writing and (ii) that disadvantages a class of stockholders that in more than a
de minimus way but less than a material way shall require the consent of a
majority of the equity interests held by such affected class of stockholders.
[Signatures on following pages]

--------------------------------------------------------------------------------

 

 

          If the foregoing accurately sets forth our agreement, please
acknowledge your acceptance thereof in the space provided below for that
purpose.

                  Very truly yours,    
 
                BAIN CAPITAL FUND IX, L.P.    
 
           
 
  By:   BAIN CAPITAL PARTNERS IX, L.P.,    
 
      its general partner    
 
           
 
  By:   BAIN CAPITAL INVESTORS, LLC,
its general partner    
 
           
 
  By:        
 
     
 
   
 
      Name:    
 
      Title:    
 
                KKR MILLENNIUM FUND, L.P.    
 
           
 
  By:   KKR ASSOCIATES MILLENNIUM L.P.,    
 
      its general partner    
 
           
 
  By:   KKR MILLENNIUM GP LLC,    
 
      its general partner    
 
           
 
  By:        
 
           
 
      Name:    
 
      Title:    
 
                KKR 2006 FUND L.P.    
 
           
 
  By:   KKR Associates 2006 L.P.    
 
      its General Partner    
 
           
 
  By:   KKR 2006 GP LLC    
 
      its General Partner    
 
           
 
  By:        
 
     
 
Name:    
 
      Title:    

[signature page to Sale Participation Agreement]

--------------------------------------------------------------------------------

 

 

                  ML GLOBAL PRIVATE EQUITY FUND, L.P.    
 
           
 
  By:   MLGPE LTD, its General Partner    
 
           
 
  By:        
 
     
 
   
 
      Name:    
 
      Title:    

[signature page to Sale Participation Agreement]

--------------------------------------------------------------------------------

 

 

 
Accepted and agreed this                      day of
 
                                        2006.

               
Name:
       
 
 
 
   

[signature page to Sale Participation Agreement]