<PAGE>
As filed with the Securities and Exchange Commission on November 27, 1996
Registration No. 333-_____
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
--------------------------
NATIONWIDE HEALTH PROPERTIES, INC.
(Exact name of registrant as specified in its charter)
Maryland 95-3997619
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
4675 MacArthur Court, Suite 1170
Newport Beach, California 92660
(714) 251-1211
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
R. Bruce Andrews
Chief Executive Officer and President
Nationwide Health Properties, Inc.
4675 MacArthur Court, Suite 1170
Newport Beach, California 92660
(714) 251-1211
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
Copy To:
Gary J. Singer, Esq.
O'Melveny & Myers LLP
610 Newport Center Drive, Suite 1700
Newport Beach, CA 92660-6429
----------------------------
Approximate date of commencement of proposed sale to the public: From
time to time after the effective date of this Registration Statement as
determined by market conditions.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, check the following box.
[_]
If any of the securities being registered on this Form are to be
offered on a delayed or continuous basis pursuant to Rule 415 under the
Securities Act of 1933, other than securities offered only in connection with
dividend or interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an
offering pursuant to Rule 462(b) under the Securities Act, please check the
following box and list the Securities Act registration statement number of the
earlier effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule
462(c) under the Securities Act, check the following box and list the Securities
Act registration statement number of the earlier effective registration
statement for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule
434, please check the following box. [_]
<PAGE>
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM
TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE AMOUNT OF
SECURITIES TO BE REGISTERED REGISTERED PER UNIT OFFERING PRICE REGISTRATION FEE
- ------------------------------ ---------------- ---------------- ------------------ ----------------
<S> <C> <C> <C> <C>
Debt Securities............... (1)(2) (3) (1)(2) NA
Preferred Stock (par
value $1.00 per share)....... (1)(4) (3) (1)(3)(4) NA
Depositary Shares............. (1)(4)(5) (3) (1)(3)(5) NA
Common Stock (par
value $0.10 per share)....... (1)(6) (3) (1)(3)(6) NA
Securities Warrants (1)(7) (3) (1)(3)(7) NA
Total..................... $300,000,000 (3) $300,000,000 $90,910(8)
===============================================================================================================
</TABLE>
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, or until the Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
(footnotes)
(1) In no event will the aggregate maximum offering price of all securities
issued pursuant to this Registration Statement exceed $300,000,000 or, if
any Debt Securities are issued with original issue discount, such greater
amount as shall result in an aggregate offering price of $300,000,000. Any
securities registered hereunder may be sold separately or as units with
other securities registered hereunder.
(2) Subject to Footnote (1), there is being registered hereunder an
indeterminate principal amount of Debt Securities.
(3) The proposed maximum offering price per unit will be determined, from time
to time, by the Registrant in connection with the issuance by the
Registrant of the securities registered hereunder.
(4) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of shares of Preferred Stock (par value of $1.00 per
share) as may be sold, from time to time, by the Registrant. There is also
being registered hereunder an indeterminate number of shares of Preferred
Stock and Depositary Shares as shall be issuable upon conversion of Debt
Securities or exercise of Securities Warrants registered hereby.
(5) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of Depositary Shares to be issued pursuant to Deposit
Agreements. In the event the Registrant elects to offer to the public
fractional interests in shares of the Preferred Stock registered hereunder,
Depositary Receipts will be distributed to those persons purchasing such
fractional interests, and the shares of Preferred Stock will be issued to
the Depositary under any such Deposit Agreement.
(6) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of shares of Common Stock as may be sold, from time to
time, by the Registrant. There is also being registered hereunder an
indeterminate number of shares of Common Stock as shall be issuable upon
conversion of the Preferred Stock or Debt Securities or exercise of
Securities Warrants registered hereby.
(7) Subject to Footnote (1), there is being registered hereunder an
indeterminate number of Debt Securities Warrants, Preferred Stock Warrants,
Depositary Shares Warrants and Common Stock Warrants representing rights to
purchase Debt Securities, Preferred Stock, Depositary Shares and Common
Stock, respectively, registered pursuant to this Registration Statement.
(8) Calculated pursuant to Rule 457(o) of the rules and regulations under the
Securities Act of 1933, as amended.
2
<PAGE>
Prospectus
- ----------
NATIONWIDE HEALTH PROPERTIES, INC.
Securities
Nationwide Health Properties, Inc. (the "Company") may offer from time to
time, in one or more series, its unsecured debt securities (the "Debt
Securities"), warrants to purchase Debt Securities (the "Debt Securities
Warrants"), shares of its Preferred Stock, par value $1.00 per share (the
"Preferred Stock"), warrants to purchase Preferred Stock (the "Preferred Stock
Warrants"), warrants to purchase Depositary Shares (as defined below) (the
"Depositary Shares Warrants"), shares of its Common Stock, par value $0.10 per
share (the "Common Stock") and warrants to purchase Common Stock (the "Common
Stock Warrants," and with the Debt Securities Warrants, the Preferred Stock
Warrants and the Depositary Shares Warrants, being collectively referred to
herein as the "Securities Warrants"). The Debt Securities, the Preferred Stock,
the Common Stock and the Securities Warrants are collectively referred to herein
as the "Securities." The Securities will have an aggregate offering price of
$300,000,000 and will be offered on terms to be determined at the time of
offering.
In the case of Debt Securities, the specific title, the aggregate principal
amount, the purchase price, the maturity, the rate and time of payment of any
interest, any redemption or sinking fund provisions, any conversion provisions
and any other specific term of the Debt Securities will be set forth in the
accompanying supplement to this Prospectus (the "Prospectus Supplement"). In
the case of Preferred Stock, the specific number of shares, designation, stated
value per share, liquidation preference per share, issuance price, dividend rate
(or method of calculation), dividend payment dates, any redemption or sinking
fund provisions, any conversion rights and other specific terms of the series of
Preferred Stock will be set forth in the accompanying Prospectus Supplement. In
addition, the Prospectus Supplement will describe whether interests in the
Preferred Stock will be represented by depositary shares (the "Depositary
Shares") evidenced by depositary receipts. In the case of Common Stock, the
specific number of shares and issuance price per share will be set forth in the
accompanying Prospectus Supplement. In the case of Securities Warrants, the
duration, offering price, exercise price and detachability, if applicable, will
be set forth in the accompanying Prospectus Supplement. The Prospectus
Supplement will also disclose whether the Securities will be listed on a
national securities exchange and if they are not to be listed, the possible
effects thereof on their marketability.
Securities may be sold directly, through agents from time to time or
through underwriters or dealers. If any agent of the Company or any underwriter
is involved in the sale of the Securities, the name of such agent or underwriter
and any applicable commission or discount will be set forth in the accompanying
Prospectus Supplement. See "Plan of Distribution." The net proceeds to the
Company from such sale also will be set forth in the applicable Prospectus
Supplement.
The Debt Securities, if issued, may rank on parity with all other unsecured
and unsubordinated indebtedness of the Company or may be subordinated to certain
other indebtedness of the Company. See "Description of Debt Securities."
__________________________________
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION
TO THE CONTRARY IS A CRIMINAL OFFENSE.
__________________________________
THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR
ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION
TO THE CONTRARY IS UNLAWFUL.
___________________________________
This Prospectus may not be used to consummate sales of Securities unless
accompanied by a Prospectus Supplement.
___________________________________
The date of this Prospectus is November 27, 1996
1
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") and, in accordance
therewith, files reports, proxy statements and other information with the
Securities and Exchange Commission (the "Commission"). Such reports, proxy
statements and other information can be inspected and copied at the Public
Reference Room of the Commission, Room 1024, at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Commission's regional offices at 7 World
Trade Center, 13th Floor, New York, New York 10048 and Northwestern Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of
such material can be obtained by mail from the Public Reference Section of the
Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 at
prescribed rates. In addition, such materials may also be inspected at the
offices of the New York Stock Exchange, 20 Broad Street, New York, New York
10005.
The Company has filed with the Commission a Registration Statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act").
This Prospectus and any accompanying Prospectus Supplement do not contain all of
the information set forth in the Registration Statement, certain parts of which
are omitted in accordance with the rules and regulations of the Commission. For
further information, reference is made to the Registration Statement, which may
be examined without charge at the public reference facilities maintained by the
Commission at the Public Reference Room of the Commission, Room 1024, 450 Fifth
Street, N.W., Washington, D.C. 20549. Copies thereof may be obtained from the
Commission upon payment of the prescribed fees.
____________________________________
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The Company's Annual Report on Form 10-K for the fiscal year ended December
31, 1995 and its Quarterly Reports on Form 10-Q for the quarters ended March 31,
1996, June 30, 1996 and September 30, 1996 are incorporated in and made a part
of this Prospectus. All documents filed by the Company with the Commission
pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to
the date of this Prospectus and prior to the termination of the offering of the
Securities shall be deemed to be incorporated by reference herein and to be a
part hereof from the date of filing such documents. A statement contained
herein, in a Prospectus Supplement or in a document incorporated or deemed to be
incorporated by reference herein, shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein,
in a Prospectus Supplement or in any subsequently filed document which is
incorporated by reference herein, modifies or supersedes such statement. Any
such statements so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus.
The Company will provide without charge to each person to whom this
Prospectus is delivered, on the request of any such person, a copy of any or all
the documents incorporated herein by reference (other than exhibits to such
documents, unless such exhibits are specifically incorporated by reference into
the documents that this Prospectus incorporates). Requests for such copies
should be directed to Nationwide Health Properties, Inc., 4675 MacArthur Court,
Suite 1170, Newport Beach, California 92660, Attention: Mark L. Desmond
(telephone number (714) 251-1211).
2
<PAGE>
THE COMPANY
Nationwide Health Properties, Inc., a Maryland corporation organized in
October 1985 (the "Company"), is a real estate investment trust ("REIT") which
invests primarily in health care related facilities and provides financing to
health care providers. As of September 30, 1996, the Company had investments in
224 facilities located in 30 states. The facilities include 182 long-term
health care facilities, 40 assisted living facilities and two rehabilitation
hospitals.
As of September 30, 1996, the Company had direct ownership of 139 long-term
health care facilities, 35 assisted living facilities and two rehabilitation
hospitals. All of the Company's owned facilities are leased under "net" leases
(the "Leases"), which are accounted for as operating leases, to 35 health care
providers (the "Lessees") including Beverly Enterprises, Inc. ("Beverly"), ARV
Assisted Living, Inc., Sun Healthcare Group, Inc., Horizon/CMS Healthcare
Corporation, Living Centers of America, Inc., GranCare Inc., Integrated Health
Services, Inc., HEALTHSOUTH Corporation, Alternative Living Services, Inc.,
Mariner Health Group, and Retirement Care Associates, Inc. Of the Lessees, only
Beverly and ARV Assisted Living, Inc. account for more than 10% of the Company's
revenue.
The Leases have initial terms ranging from 10 to 19 years, and generally
the Leases have two or more multi-year renewal options. The Company earns fixed
monthly minimum rents and may earn periodic additional rents. The additional
rent payments are generally computed as a percentage of facility net patient
revenues in excess of base amounts. The base amounts, in most cases, are net
patient revenues for the first year of the lease. Most Leases contain cross
collateralization and cross default provisions tied to other Leases with the
same Lessee, as well as grouped lease renewals and grouped purchase options.
Obligations under the Leases have corporate guarantees, and Leases covering 94
facilities are backed by irrevocable letters of credit or security deposits
which cover one to 12 months of monthly minimum rents. Under the terms of the
Leases, the Lessee is responsible for all maintenance, repairs, taxes and
insurance on the leased properties.
As of September 30, 1996, the Company held 29 mortgage loans secured by 43
long-term health care facilities and 5 assisted living facilities. As of
September 30, 1996, the mortgage loans had a net book value of approximately
$155,507,000 with individual outstanding balances ranging from approximately
$754,000 to $17,250,000 and maturities ranging from 1998 to 2031.
As of September 30, 1996, 45 of the Company's 176 owned facilities were
being leased to and operated by subsidiaries of Beverly. Beverly has guaranteed
certain obligations of its subsidiaries and of certain parties unaffiliated with
Beverly in connection with 24 properties operated by such parties. Rental and
interest income from Beverly accounted for 40%, 34% and 27% of the Company's
total revenues for the years ended December 31, 1993, 1994 and 1995,
respectively, and for 23% of the Company's total revenues for the nine months
ended September 30, 1996.
The Company anticipates providing lease or mortgage financing for health
care facilities to qualified operators and acquiring additional health care
related facilities, including long-term health care facilities, assisted living
facilities, acute care hospitals and medical office buildings. Financing for
such future investment may be provided by borrowings under the Company's bank
line of credit, private placements or public offerings of debt or equity, and
the assumption of indebtedness.
The Company operates so as to qualify as a REIT under Sections 856 through
860 of the Internal Revenue Code of 1986, as amended (the "Code"). As a REIT,
the Company distributes to its stockholders substantially all of its cash flow
from operations and, in any event, at least 95% of its taxable income. If the
Company qualifies for taxation as a REIT, it will generally not be subject to
federal corporate income taxes on its net income that is currently distributed
to stockholders. This treatment substantially eliminates the "double taxation"
(e.g., at the corporate and stockholder levels) that generally results from
investment in stock of a corporation.
The Company's principal executive offices are located at 4675 MacArthur Court,
Suite 1170, Newport Beach, California 92660 and its telephone number is (714)
251-1211.
3
<PAGE>
SELECTED CONSOLIDATED FINANCIAL INFORMATION
The following selected consolidated financial information of the Company,
restated for the two-for-one stock split effective March 8, 1996, for each of
the five years ended December 31, 1995 is derived from the Company's audited
consolidated financial statements, which have been audited by Arthur Andersen
LLP, independent accountants. The selected consolidated financial information
for the nine month periods ended September 30, 1996 and 1995 has been derived
from the unaudited interim consolidated financial statements of the Company and
includes, in the opinion of management, all adjustments (consisting only of
normal recurring adjustments) necessary for a fair presentation of the financial
position and results of operations as of and for such periods. Such financial
information has been derived from financial information included in the
Company's Annual Reports on Form 10-K and the Company's Quarterly Reports on
Form 10-Q. The selected consolidated financial information set forth below
should be read in conjunction with the detailed information, consolidated
financial statements and related notes and applicable "Management's Discussion
and Analysis" included in the 1995, 1994, 1993, 1992 and 1991 Annual Reports on
Form 10-K.
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30, YEAR ENDED DECEMBER 31,
---------------------- -------------------------------------------------------------
1996 1995 1995 1994 1993 1992 1991
--------- ---------- ------------ ------------ ---------- ---------- ---------
OPERATING DATA: (IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C> <C> <C>
Revenues:
Minimum rent............................... $ 49,431 $ 39,947 $ 54,504 $ 47,805 $ 40,758 $ 38,062 $ 31,439
Additional rent and
additional interest...................... 8,862 8,909 11,776 9,767 8,417 6,241 4,063
Interest and other income 12,242 10,826 14,759 12,413 11,210 5,504 876
--------- --------- --------- ----------- --------- --------- --------
70,535 59,682 81,039 69,985 60,385 49,807 36,378
Expenses:
Depreciation and non-
cash charges............................. 12,454 10,246 13,885 12,244 10,115 9,219 7,585
Interest and amortization of
deferred financing costs................. 15,539 10,525 14,628 9,921 6,186 8,162 4,849
General and administrative................. 2,499 2,356 3,144 3,007 3,088 2,883 2,403
--------- --------- --------- ----------- --------- --------- --------
30,492 23,127 31,657 25,172 19,389 20,264 14,837
--------- --------- --------- ----------- --------- --------- --------
Income from operations...................... 40,043 36,555 49,382 44,813 40,996 29,543 21,541
Gain on sale of facilities.................. -- 989 989 -- -- 138 --
Extraordinary charge(1)..................... -- -- -- -- (2,004) -- (3,460)
--------- --------- --------- ----------- --------- --------- --------
Net income.................................. $ 40,043 $ 37,544 $ 50,371 $ 44,813 $ 38,992 $ 29,681 $ 18,081
========= ========= ========= =========== ========= ========= ========
Dividends paid.............................. $ 44,121 $ 39,145 $ 53,182 $ 47,751 $ 42,883 $ 33,349 $ 26,245
PER SHARE DATA:
Income from operations...................... $1.00 $.97 $1.31 $1.23 $1.17 $.99 $.84
Net income.................................. 1.00 1.00 1.33 1.23 1.11 1.00 .70
Dividends paid.............................. 1.11 1.05 1.41 1.31 1.21 1.11 1.03
BALANCE SHEET DATA:
Investments in real estate, net............. $700,490 $557,375 $ 652,231 $501,862 $428,473 $380,539 $289,761
Total assets................................ 723,661 572,094 670,111 513,809 440,165 396,664 305,837
Senior unsecured notes due 2000-2015........ 150,000 56,000 100,000 -- -- -- --
Bank borrowings............................. 48,200 48,700 93,900 80,200 3,800 9,950 --
Convertible debentures...................... 65,000 65,000 65,000 67,690 73,609 44,455 50,000
Notes and bonds payable..................... 9,249 14,190 23,364 20,520 23,047 32,116 33,124
Stockholders' equity........................ 428,963 372,903 371,822 336,106 332,927 301,895 218,772
OTHER DATA:
Net cash provided by operating activities... 54,960 51,066 66,972 56,756 49,725 38,207 30,217
Net cash used in investing activities....... (59,252) (62,820) (151,476) (83,185) (56,261) (96,719) (55,899)
Net cash provided by financing activities... 6,429 14,051 88,699 26,544 1,882 56,837 32,365
Funds from operations (2)................... $ 52,497 $ 46,801 $ 63,267 $ 57,057 $ 51,111 $ 38,762 $ 29,126
Weighted average shares outstanding......... 39,899 37,500 37,808 36,356 35,188 29,734 25,674
__________________________
</TABLE>
(1) The Company incurred extraordinary charges representing the write-off of
unamortized deferred financing costs and fees in connection with the
prepayment of substantial portions of the Company's secured debt.
(2) Industry analysts generally consider funds from operations to be an
alternative measure of the performance of an equity REIT. The Company
therefore discloses funds from operations, although it is a measurement
that is not defined by generally accepted accounting principles. The
4
<PAGE>
Company uses the NAREIT measure of funds from operations, which is
generally defined as income before extraordinary items plus certain non-
cash items, primarily depreciation, less gains on sales of facilities. The
NAREIT measure may not be comparable to similarly titled measures used by
other REITs. Consequently, the Company's funds from operations may not
provide a meaningful measure of the Company's performance as compared to
that of other REITs. Funds from operations does not represent cash
generated from operating activities as defined by generally accepted
accounting principles (funds from operations does not include changes in
operating assets and liabilities) and, therefore, should not be considered
as an alternative to net income as the primary indicator of operating
performance or to cash flow as a measure of liquidity.
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
Nine Months
Ended
Year Ended December 31, September 30,
---------------------------------- ---------------
1991 1992 1993 1994 1995 1996
---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio... 5.44 4.64 7.63 5.52 4.57 3.58
</TABLE>
USE OF PROCEEDS
Unless otherwise specified in the Prospectus Supplement which accompanies this
Prospectus, the net proceeds from the sale of the Securities offered from time
to time hereby will be used for general corporate purposes, including the
repayment of bank lines of credit and investments in health care related
properties. The Company uses its existing revolving bank credit facility
primarily to provide financing for the acquisitions of health care related
facilities. To the extent that the Company has amounts outstanding under the
credit facility at the time it issues Securities, it is currently required to
use the proceeds of such issuance to repay amounts outstanding under the credit
facility.
DESCRIPTION OF DEBT SECURITIES
Debt Securities may be issued from time to time in series under an Indenture
(the "Indenture") to be entered into between the Company and The Bank of New
York, as Trustee (the "Trustee"). As used under this caption, unless the
context otherwise requires, Offered Debt Securities shall mean the Debt
Securities offered by this Prospectus and the accompanying Prospectus
Supplement. The statements under this caption are brief summaries of certain
provisions contained in the Indenture, do not purport to be complete and are
qualified in their entirety by reference to the Indenture, including the
definition therein of certain terms, a copy of which is filed as an exhibit to
the Registration Statement of which this Prospectus is a part. The following
sets forth certain general terms and provisions of the Debt Securities. Further
terms of the Offered Debt Securities will be set forth in the Prospectus
Supplement.
GENERAL
The Indenture provides for the issuance of Debt Securities in series, and does
not limit the principal amount of Debt Securities which may be issued
thereunder.
Reference is made to the Prospectus Supplement for the following terms of the
Offered Debt Securities: (1) the specific title of the Offered Debt Securities;
(2) the aggregate principal amount of the Offered Debt Securities; (3) the
percentage of their principal amount at which the Offered Debt Securities will
be issued; (4) the date on which the Offered Debt Securities will mature; (5)
the rate or rates per annum or the method for determining such rate or rates, if
any, at which the Offered Debt Securities will bear interest; (6) the times at
which any such interest will be payable; (7) any provisions relating to optional
or mandatory redemption of the Offered Debt Securities at the option of the
Company or pursuant to sinking fund or analogous provisions; (8) the
denominations in which the Offered Debt Securities are authorized to be issued;
(9) any provisions relating to the conversion or exchange of the Offered Debt
Securities into Common Stock, Preferred Stock or
5
<PAGE>
into Debt Securities of another series; (10) whether the Offered Debt Securities
are to be issued in fully registered form without coupons or in bearer form with
interest coupons or both; (11) the place or places at which the Company will
make payments of principal (and premium, if any) and interest, if any, and the
method of payment; (12) whether the Offered Debt Securities will be issued in
whole or in part in global form; (13) any additional covenants and Events of
Default and the remedies with respect thereto not currently set forth in the
Indenture; (13) whether the Offered Debt Securities will be subordinated to
other indebtedness of the Company; and (14) any other specific terms of the
Offered Debt Securities.
One or more series of the Debt Securities may be issued as discounted Debt
Securities (bearing no interest or bearing interest at a rate which at the time
of issuance is below market rates) to be sold at a substantial discount below
their stated principal amount. Tax and other special considerations applicable
to any such discounted Debt Securities will be described in the Prospectus
Supplement relating thereto.
STATUS OF DEBT SECURITIES
The Debt Securities will be unsecured obligations of the Company and may be
ranking on a parity with all other unsecured and unsubordinated indebtedness or
may be subordinated to certain other indebtedness of the Company.
CONVERSION RIGHTS
The terms, if any, on which Debt Securities of a series may be exchanged for
or converted into shares of Common Stock, Preferred Stock or Debt Securities of
another series will be set forth in the Prospectus Supplement relating thereto.
To protect the Company's status as a REIT, a Holder may not convert any Debt
Security, and such Debt Security shall not be convertible by any Holder, if as a
result of such conversion any person would then be deemed to beneficially own,
directly or indirectly, 9.9% or more of the Company's shares of Common Stock.
ABSENCE OF RESTRICTIVE COVENANTS
Except as noted below under "Dividends, Distributions and Acquisitions of
Capital Stock," the Company is not restricted by the Indenture from paying
dividends or from incurring, assuming or becoming liable for any type of debt or
other obligations or from creating liens on its property for any purpose. The
Indenture does not require the maintenance of any financial ratios or specified
levels of net worth or liquidity. Except as may be set forth in the Prospectus
Supplement, there are no provisions of the Indenture which afford holders of the
Debt Securities protection in the event of a highly leveraged transaction
involving the Company.
OPTIONAL REDEMPTION
The Debt Securities will be subject to redemption, in whole or from time to
time in part, at any time for certain reasons intended to protect the Company's
status as a REIT, at the option of the Company in the manner specified in the
Indenture at a redemption price equal to 100% of the principal amount, plus
interest accrued to the date of redemption. The Indenture does not contain any
provision requiring the Company to repurchase the Debt Securities at the option
of the Holders thereof in the event of a leveraged buyout, recapitalization or
similar restructuring of the Company, even though the Company's creditworthiness
and the market value of the Debt Securities may decline significantly as a
result of such transaction. The Indenture does not protect Holders of the Debt
Securities against any decline in credit quality, whether resulting from any
such transaction or from any other cause.
DIVIDENDS, DISTRIBUTIONS AND ACQUISITIONS OF CAPITAL STOCK
The Indenture provides that the Company will not (i) declare or pay any
dividend or make any distribution on its capital stock or to holders of its
capital stock (other than dividends or distributions payable in its capital
stock or other than as the Company determines is necessary to maintain its
status as a REIT) or (ii) purchase,
6
<PAGE>
redeem or otherwise acquire or retire for value any of its capital stock, or any
warrants, rights or options or other securities to purchase or acquire any
shares of its capital stock (other than the Debt Securities) or permit any
subsidiary to do so, if at the time of such action an Event of Default (as
defined in the Indenture) has occurred and is continuing or would exist
immediately after giving effect to such action.
EVENTS OF DEFAULT
An Event of Default with respect to Debt Securities of any series is defined
in the Indenture as being: (a) failure to pay principal of or any premium on
any Debt Security of that series when due; (b) failure to pay any interest on
any Debt Security of that series when due, continued for 30 days; (c) failure to
deposit any sinking fund payment when due, in respect of any Debt Security of
that series; (d) failure to perform any other covenant of the Company in the
Indenture (other than a covenant included in the Indenture solely for the
benefit of one or more series of Debt Securities other than that series),
continued for 60 days after written notice as provided in the Indenture; (e)
certain events of bankruptcy, insolvency, conservatorship, receivership or
reorganization; (f) a default under any mortgage, indenture or instrument
evidencing any indebtedness for borrowed money by the Company (including the
Indenture) resulting in an aggregate principal amount exceeding $10,000,000
becoming or being declared due and payable prior to its maturity date or
constituting a failure to pay at maturity an aggregate principal amount
exceeding $10,000,000, unless such acceleration has been rescinded or annulled
or such indebtedness has been discharged within 10 days after written notice to
the Company by the Trustee or Holders of at least 25% in aggregate principal
amount of the outstanding Debt Securities declaring a default or the Company is
contesting the validity of such default in good faith by appropriate
proceedings; and (g) any other Event of Default provided with respect to the
Debt Securities of that series.
If an Event of Default with respect to the outstanding Debt Securities of any
series occurs and is continuing, either the Trustee or the Holders of at least
25% in aggregate principal amount of the outstanding Debt Securities of that
series may declare the principal amount (or, if the Debt Securities of that
series are original issue discount Debt Securities, such portion of the
principal amount as may be specified in the terms of that series) of all the
outstanding Debt Securities of that series to be due and payable immediately.
At any time after the declaration of acceleration with respect to the Debt
Securities of any series has been made, but before a judgment or decree based on
acceleration has been obtained, the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of that series may, under certain
circumstances, rescind and annul such acceleration.
The Indenture provides that, subject to the duty of the Trustee during default
to act with the required standard of care, the Trustee will be under no
obligation to exercise any of its rights or powers under the Indenture at the
request or direction of any of the Holders, unless such Holders shall have
offered to the Trustee reasonable indemnity. Subject to such provisions for the
indemnification of the Trustee and subject to certain limitations, the Holders
of a majority in aggregate principal amount of the outstanding Debt Securities
of any series will have the right to direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or exercising
any trust or power conferred on the Trustee, with respect to the Debt Securities
of that series.
The Company is required to furnish to the Trustee annually a statement as to
the performance by the Company of certain of its obligations under the Indenture
and as to any default in such performance.
MODIFICATION AND WAIVER
Modifications and amendments of the Indenture may be made by the Company and
the Trustee without the consent of any Holders to, among other things, (a)
evidence the succession of another corporation to the Company, (b) add to the
covenants of the Company or surrender any right or power conferred upon the
Company, (c) cure any ambiguity, correct or supplement any provision which may
be defective or inconsistent or make any other provisions with respect to
matters or questions arising under the Indenture, provided that such action does
not adversely affect the interests of the Holders of Debt Securities of any
series in any material respect, or (d) evidence and provide for a successor
Trustee.
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Modifications and amendments of the Indenture may be made by the Company and
the Trustee with the consent of the Holders of a majority in aggregate principal
amount of the outstanding Debt Securities of each series affected by such
modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each outstanding Debt
Security affected thereby, (a) change the stated maturity date of the principal
of, or any installment of principal of or interest, if any, on any Debt
Security, (b) reduce the principal amount of, or premium or interest if any, on
any Debt Security, (c) reduce the amount of principal of an original issue
discount Debt Security payable upon acceleration of the maturity thereof, (d)
change the currency of payment of the principal of, or premium or interest, if
any, on any Debt Security, (e) impair the right to institute suit for the
enforcement of any payment on or with respect to any Debt Security, (f) modify
the conversion provisions, if any, of any Debt Security in a manner adverse to
the Holder of that Debt Security, or (g) reduce the percentage in principal
amount of the outstanding Debt Security of any series, the consent of whose
Holders is required for modification or amendment of that Indenture or for
waiver of compliance with certain provisions of that Indenture or for waiver of
certain defaults.
The Holders of a majority in aggregate principal amount of the outstanding
Debt Securities of each series may, on behalf of all Holders of the Debt
Securities of that series, waive, insofar as that series is concerned,
compliance by the Company with certain restrictive provisions of the Indenture.
The Holders of a majority in aggregate principal amount of the outstanding Debt
Securities of each series may, on behalf of all Holders of the Debt Securities
of that series, waive any past default under the Indenture with respect to the
Debt Securities of that series, except a default in the payment of principal or
premium or interest, if any, or a default in respect of a covenant or provision
which under the terms of the Indenture cannot be modified or amended without the
consent of the Holder of each outstanding Debt Security of the series affected.
CONSOLIDATION, MERGER AND SALE OF ASSETS
The Indenture provides that the Company, without the consent of the Holders of
any of the Debt Securities, may consolidate or merge with or into, or transfer
its assets substantially as an entirety to, any corporation organized under the
laws of the United States or any state, provided that the successor corporation
assumes the Company's obligations under the Indenture, that after giving effect
to the transaction no Event of Default, and no event which, after notice or
lapse of time, would become an Event of Default, shall have occurred and be
continuing, and that certain other conditions are met.
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in global
form (the "Global Securities"). The Global Securities will be deposited with a
depositary (the "Depositary"), or with a nominee for a Depositary, identified in
the Prospectus Supplement. In such case, one or more Global Securities will be
issued in a denomination or aggregate denominations equal to the portion of the
aggregate principal amount of outstanding Debt Securities of the series to be
represented by such Global Security or Securities. Unless and until it is
exchanged in whole or in part for Debt Securities in definitive form, a Global
Security may not be transferred except as a whole by the Depositary for such
Global Security to a nominee of such Depositary or by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or by such
Depositary or any such nominee to a successor of such Depositary or a nominee of
such successor.
The specific material terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a Global Security
will be described in the Prospectus Supplement. The Company anticipates that
the following provisions will apply to all depositary arrangements.
Upon the issuance of a Global Security, the Depositary for such Global
Security will credit, on its book-entry registration and transfer system, the
respective principal amounts of the Debt Securities represented by such Global
Security to the accounts of persons that have accounts with such Depositary
("participants"). The accounts to be credited shall be designated by any
underwriters or agents participating in the distribution of such Debt
Securities. Ownership of beneficial interests in a Global Security will be
limited to participants or persons that may hold interests through participants.
Ownership of beneficial interests in such Global Security will be shown
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on, and the transfer of that ownership will be effected only through, records
maintained by the Depositary for such Global Security (with respect to interests
of participants) or by participants or persons that hold through participants
(with respect to interests of persons other than participants). So long as the
Depositary for a Global Security, or its nominee, is the registered owner of
such Global Security, such Depositary or such nominee, as the case may be, will
be considered the sole owner or Holder of the Debt Securities represented by
such Global Security for all purposes under the Indenture; provided, however,
that for purposes of obtaining any consents or directions required to be given
by the Holders of the Debt Securities, the Company, the Trustee and its agents
will treat a person as the holder of such principal amount of Debt Securities as
specified in a written statement of the Depositary. Except as set forth herein
or otherwise provided in the Prospectus Supplement, owners of beneficial
interests in a Global Security will not be entitled to have the Debt Securities
represented by such Global Security registered in their names, will not receive
physical delivery of such Debt Securities in definitive form and will not be
considered the owners or Holders thereof under the Indenture.
Principal, premium, if any, and interest payments on Debt Securities
represented by a Global Security registered in the name of a Depositary or its
nominee will be made to such Depositary or its nominee, as the case may be, as
the registered owner of such Global Security. None of the Company, the Trustee
or any Paying Agent for such Debt Securities will have any responsibility or
liability for any aspect of the records relating to or payments made on account
of beneficial ownership interests in such Global Security or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
The Company expects that the Depositary for any Debt Securities represented by
a Global Security, upon receipt of any payment of principal, premium, if any, or
interest will immediately credit participants' accounts with payments in amounts
proportionate to their respective beneficial interests in the principal amount
of such Global Security as shown on the records of such Depositary. The Company
also expects that payments by participants will be governed by standing
instructions and customary practices, as is now the case with the securities
held for the accounts of customers registered in "street names" and will be the
responsibility of such participants.
If the Depositary for any Debt Securities represented by a Global Security is
at any time unwilling or unable to continue as Depositary and a successor
Depositary is not appointed by the Company within 90 days, the Company will
issue such Debt Securities in definitive form in exchange for such Global
Security. In addition, the Company may at any time and in its sole discretion
determine not to have any of the Debt Securities of a series represented by one
or more Global Securities and, in such event, will issue Debt Securities of such
series in definitive form in exchange for all of the Global Security or
Securities representing such Debt Securities.
The laws of some states require that certain purchasers of securities take
physical delivery of such securities in definitive form. Such laws may impair
the ability to transfer beneficial interests in Debt Securities represented by
Global Securities.
GOVERNING LAW
The Indenture and the Debt Securities will be governed by and construed in
accordance with the laws of the State of New York.
DESCRIPTION OF PREFERRED STOCK
The following description of the terms of the Preferred Stock sets forth
certain general terms and provisions of the Preferred Stock to which any
Prospectus Supplement may relate. Certain other terms of any series of the
Preferred Stock offered by any Prospectus Supplement will be described in such
Prospectus Supplement. The description of certain provisions of the Preferred
Stock set forth below and in any Prospectus Supplement does not purport to be
complete and is subject to and qualified in its entirety by reference to the
Company's Amended and Restated Articles of Incorporation (the "Articles of
Incorporation"), and the Board of Directors' resolution or articles
supplementary (the "Articles Supplementary") relating to each series of the
Preferred Stock which will
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be filed with the Commission and incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part at or prior to the
time of the issuance of such series of the Preferred Stock.
GENERAL
The authorized capital stock of the Company consists of 100,000,000 shares of
Common Stock, $0.10 par value per share, and 5,000,000 shares of preferred
stock, $1.00 par value per share ("preferred stock of the Company," which term,
as used herein, includes the Preferred Stock offered hereby). See "Description
of Common Stock."
Under the Articles of Incorporation, the Board of Directors of the Company is
authorized without further stockholder action to provide for the issuance of up
to 5,000,000 shares of preferred stock of the Company, in one or more series,
with such voting, dividend, conversion or liquidation rights, designations,
preferences, powers and relative participating, optional or other special rights
and qualifications, limitations or restrictions of shares of such series as
shall be stated in the resolution providing for the issue of a series of such
stock, adopted, at any time or from time to time, by the Board of Directors of
the Company.
As described under "Description of Depositary Shares," the Company may, at its
option, elect to offer Depositary Shares evidenced by depositary receipts (the
"Depositary Receipts"), each representing a fraction (to be specified in the
Prospectus Supplement relating to the particular series of the Preferred Stock)
of a share of the particular series of the Preferred Stock issued and deposited
with a depositary, in lieu of offering full shares of such series of the
Preferred Stock.
The Preferred Stock shall have the dividend, liquidation, redemption and
voting rights set forth below unless otherwise provided in a Prospectus
Supplement relating to a particular series of the Preferred Stock. Reference is
made to the Prospectus Supplement relating to the particular series of the
Preferred Stock offered thereby for specific terms, including: (i) the
designation and stated value per share of such Preferred Stock and the number of
shares offered; (ii) the amount of liquidation preference per share; (iii) the
initial public offering price at which such Preferred Stock will be issued; (iv)
the dividend rate (or method of calculation), the dates on which dividends shall
be payable and the dates from which dividends shall commence to cumulate, if
any; (v) any redemption or sinking fund provisions; (vi) any conversion rights;
(vii) whether the Company has elected to offer Depositary Shares as described
below under "Description of Depositary Shares;" and (viii) any additional
voting, dividend, liquidation, redemption, sinking fund and other rights,
preferences, privileges, limitations and restrictions.
The Preferred Stock will, when issued, be fully paid and nonassessable and
will have no preemptive rights. Unless otherwise stated in a Prospectus
Supplement relating to a particular series of the Preferred Stock, each series
of the Preferred Stock will rank on a parity as to dividends and distributions
of assets with each other series of the Preferred Stock. The rights of the
holders of each series of the Preferred Stock will be subordinate to those of
the Company's general creditors.
CERTAIN PROVISIONS OF THE ARTICLES OF INCORPORATION
See "Description of Common Stock --- Redemption and Business Combination
Provisions" for a description of certain provisions of the Articles of
Incorporation, including provisions relating to redemption rights and provisions
which may have certain anti-takeover effects.
DIVIDEND RIGHTS
Holders of the Preferred Stock of each series will be entitled to receive,
when, as and if declared by the Board of Directors of the Company, out of funds
of the Company legally available therefor, cash dividends on such dates and at
such rates as are set forth in, or as are determined by the method described in,
the Prospectus Supplement relating to such series of the Preferred Stock. Such
rate may be fixed or variable or both. Each such dividend will be payable to
the holders of record as they appear on the stock books of the Company (or,
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if applicable, the records of the Depositary (as hereinafter defined) referred
to under "Description of Depositary Shares") on such record dates, fixed by the
Board of Directors of the Company, as specified in the Prospectus Supplement
relating to such series of Preferred Stock.
Such dividends may be cumulative or noncumulative, as provided in the
Prospectus Supplement relating to such series of Preferred Stock. If the Board
of Directors of the Company fails to declare a dividend payable on a dividend
payment date on any series of Preferred Stock for which dividends are
noncumulative, then the right to receive a dividend in respect of the dividend
period ending on such dividend payment date will be lost, and the Company shall
have no obligation to pay the dividend accrued for such period, whether or not
dividends on such series are declared payable on any future dividend payment
dates. Dividends on the shares of each series of Preferred Stock for which
dividends are cumulative will accrue from the date on which the Company
initially issues shares of such series.
So long as the shares of any series of the Preferred Stock shall be
outstanding, unless (i) full dividends (including if such Preferred Stock is
cumulative, dividends for prior dividend periods) shall have been paid or
declared and set apart for payment on all outstanding shares of the Preferred
Stock of such series and all other classes and series of preferred stock of the
Company (other than Junior Stock, as defined below) and (ii) the Company is not
in default or in arrears with respect to the mandatory or optional redemption or
mandatory repurchase or other mandatory retirement of, or with respect to any
sinking or other analogous fund for, any shares of Preferred Stock of such
series or any shares of any other preferred stock of the Company of any class or
series (other than Junior Stock), the Company may not, other than as the Company
determines is necessary to maintain its status as a REIT, declare any dividends
on any shares of Common Stock of the Company or any other stock of the Company
ranking as to dividends or distributions of assets junior to such series of
Preferred Stock (the Common Stock and any such other stock ranking junior to
such series of Preferred Stock being herein referred to as "Junior Stock"), or
make any payment on account of, or set apart money for, the purchase, redemption
or other retirement of, or for a sinking or other analogous fund for, any shares
of Junior Stock or make any distribution in respect thereof, whether in cash or
property or in obligations or stock of the Company, other than Junior Stock
which is neither convertible into, nor exchangeable or exercisable for, any
securities of the Company other than Junior Stock.
LIQUIDATION PREFERENCE
In the event of any liquidation, dissolution or winding up of the Company,
voluntary or involuntary, the holders of each series of the Preferred Stock will
be entitled to receive out of the assets of the Company available for
distribution to stockholders, before any distribution of assets is made to the
holders of Common Stock or any other shares of stock of the Company ranking
junior as to such distribution to such series of Preferred Stock, the amount set
forth in the Prospectus Supplement relating to such series of the Preferred
Stock. If, upon any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the amounts payable with respect to the Preferred
Stock of any series and any other shares of preferred stock of the Company
(including any other series of the Preferred Stock) ranking as to any such
distribution on a parity with such series of the Preferred Stock are not paid in
full, the holders of the Preferred Stock of such series and of such other shares
of preferred stock of the Company will share ratably in any such distribution of
assets of the Company in proportion to the full respective preferential amounts
to which they are entitled. After payment to the holders of the Preferred Stock
of each series of the full preferential amounts of the liquidating distribution
to which they are entitled, the holders of each such series of the Preferred
Stock will be entitled to no further participation in any distribution of assets
by the Company.
REDEMPTION
A series of the Preferred Stock may be redeemable, in whole or from time to
time in part, at the option of the Company, and may be subject to mandatory
redemption pursuant to a sinking fund or otherwise, in each case upon terms, at
the times and at the redemption prices set forth in the Prospectus Supplement
relating to such series. Shares of the Preferred Stock redeemed by the Company
will be restored to the status of authorized but unissued shares of preferred
stock of the Company.
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In the event that fewer than all of the outstanding shares of a series of the
Preferred Stock are to be redeemed, whether by mandatory or optional redemption,
the number of shares to be redeemed will be determined by lot or pro rata
(subject to rounding to avoid fractional shares) as may be determined by the
Company or by any other method as may be determined by the Company in its sole
discretion to be equitable. From and after the redemption date (unless default
shall be made by the Company in providing for the payment of the redemption
price plus accumulated and unpaid dividends, if any), dividends shall cease to
accumulate on the shares of the Preferred Stock called for redemption and all
rights of the holders thereof (except the right to receive the redemption price
plus accumulated and unpaid dividends, if any) shall cease.
So long as any dividends on shares of any series of the Preferred Stock or any
other series of preferred stock of the Company ranking on a parity as to
dividends and distribution of assets with such series of the Preferred Stock are
in arrears, no shares of any such series of the Preferred Stock or such other
series of preferred stock of the Company will be redeemed (whether by mandatory
or optional redemption) unless all such shares are simultaneously redeemed, and
the Company will not purchase or otherwise acquire any such shares; provided,
however, that the foregoing will not prevent the purchase or acquisition of such
shares pursuant to a purchase or exchange offer made on the same terms to
holders of all such shares outstanding.
CONVERSION RIGHTS
The terms, if any, on which shares of Preferred Stock of any series may be
exchanged for or converted (mandatorily or otherwise) into shares of Common
Stock or another series of Preferred Stock will be set forth in the Prospectus
Supplement relating thereto. See "Description of Common Stock."
VOTING RIGHTS
Except as indicated below or in a Prospectus Supplement relating to a
particular series of the Preferred Stock, or except as required by applicable
law, the holders of the Preferred Stock will not be entitled to vote for any
purpose.
So long as any shares of the Preferred Stock of a series remain outstanding,
the consent or the affirmative vote of the holders of at least 66-2/3% of the
votes entitled to be cast with respect to the then outstanding shares of such
series of the Preferred Stock together with any Other Preferred Stock (as
defined below), voting as one class, either expressed in writing or at a meeting
called for that purpose, will be necessary (i) to permit, effect or validate the
authorization, or any increase in the authorized amount, of any class or series
of shares of the Company ranking prior to the Preferred Stock of such series as
to dividends, voting or upon distribution of assets and (ii) to repeal, amend or
otherwise change any of the provisions applicable to the Preferred Stock of such
series in any manner which adversely affects the powers, preferences, voting
power or other rights or privileges qualifications, limitations and other
characteristics of such series of the Preferred Stock. In case any series of
the Preferred Stock would be so affected by any such action referred to in
clause (ii) above in a different manner than one or more series of the Other
Preferred Stock then outstanding, the holders of shares of the Preferred Stock
of such series, together with any series of the Other Preferred Stock which will
be similarly affected, will be entitled to vote as a class, and the Company will
not take such action without the consent or affirmative vote, as above provided,
of at least 66-2/3% of the total number of votes entitled to be cast with
respect to each such series of the Preferred Stock and the Other Preferred Stock
similarly affected, then outstanding, in lieu of the consent or affirmative vote
hereinabove otherwise required.
With respect to any matter as to which the Preferred Stock of any series is
entitled to vote, holders of the Preferred Stock of such series and any other
series of preferred stock of the Company ranking on a parity with such series of
the Preferred Stock as to dividends and distributions of assets and which by its
terms provides for similar voting rights (the "Other Preferred Stock") will be
entitled to cast the number of votes set forth in the Prospectus Supplement with
respect to that series of Preferred Stock. As a result of the provisions
described in the preceding paragraph requiring the holders of shares of a series
of the Preferred Stock to vote together as a class with the holders of shares of
one or more series of Other Preferred Stock, it is possible that the holders of
such shares of Other Preferred Stock could approve action that would adversely
affect such series of
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Preferred Stock, including the creation of a class of capital stock ranking
prior to such series of Preferred Stock as to dividends, voting or distributions
of assets.
As more fully described below under "Description of Depositary Shares," if the
Company elects to issue Depositary Shares, each representing a fraction of a
share of a series of the Preferred Stock, each such Depositary Share will, in
effect, be entitled to such fraction of a vote per Depositary Share.
TRANSFER AGENT AND REGISTRAR
Unless otherwise indicated in a Prospectus Supplement relating thereto,
ChaseMellon Shareholder Services LLC will be the transfer agent, dividend and
redemption price disbursement agent and registrar for shares of each series of
the Preferred Stock.
DESCRIPTION OF DEPOSITARY SHARES
The description set forth below and in the Prospectus Supplement of certain
provisions of the Deposit Agreement (as defined below) and of the Depositary
Shares and Depositary Receipts do not purport to be complete and are subject to
and qualified in their entirety by reference to the Deposit Agreement and
Depositary Receipts relating to each series of the Preferred Stock which will be
filed with the Commission and incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part at or prior to the
time of the issuance of such series of the Preferred Stock. The forms of
Deposit Agreement and Depositary Receipt are filed as exhibits to the
Registration Statement of which this Prospectus is a part.
GENERAL
The Company may, at its option, elect to offer fractional shares of Preferred
Stock rather than full shares of Preferred Stock. In the event such option is
exercised, the Company will issue to the public receipts for Depositary Shares,
each of which will represent a fraction (to be set forth in the Prospectus
Supplement relating to a particular series of the Preferred Stock) of a share of
a particular series of the Preferred Stock as described below.
The shares of any series of the Preferred Stock represented by Depositary
Shares will be deposited under a separate deposit agreement (the "Deposit
Agreement") among the Company, a bank or trust company selected by the Company
(the "Depositary") and the holders from time to time of the Depositary Receipts.
Subject to the terms of the Deposit Agreement, each owner of a Depositary Share
will in general be entitled, in proportion to the applicable fraction of a share
of Preferred Stock represented by such Depositary Share, to all the rights and
preferences of the Preferred Stock represented thereby (including dividend,
voting, redemption and liquidation rights).
The Depositary Shares relating to any series of the Preferred Stock will be
evidenced by Depositary Receipts issued pursuant to the related Deposit
Agreement. Depositary Receipts will be distributed to those persons purchasing
such Depositary Shares in accordance with the terms of the offering made by the
related Prospectus Supplement.
Upon surrender of Depositary Receipts at the office of the Depositary equal to
one or more whole Depositary Shares and upon payment of the charges provided in
the Deposit Agreement and subject to the terms thereof, a holder of Depositary
Receipts is entitled to have the Depositary deliver to such holder certificates
representing the whole shares of Preferred Stock underlying the Depositary
Shares evidenced by the surrendered Depositary Receipts.
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DIVIDENDS AND OTHER DISTRIBUTIONS
The Depositary will distribute all cash dividends or other cash distributions
received in respect of the Preferred Stock to the record holders of Depositary
Receipts relating to such Preferred Stock in proportion, insofar as practicable,
to the respective numbers of Depositary Shares evidenced by such Depositary
Receipts held by such holders on the relevant record date. The Depositary shall
distribute only such amount, however, as can be distributed without attributing
to any holder of Depositary Receipts a fraction of one cent, and any balance not
so distributed shall be added to and treated as part of the next sum received by
the Depositary (without liability for the interest thereon), for distribution to
record holders of Depositary Receipts then outstanding.
In the event of a distribution other than in cash, the Depositary will
distribute such amounts of the securities or property received by it as are, as
nearly as practicable, in proportion to the respective numbers of Depositary
Shares evidenced by the Depositary Receipts held by such holders on the relevant
record date, unless the Depositary determines that it is not feasible to make
such distribution, in which case the Depositary may, with the approval of the
Company, adopt such method as it deems equitable and practicable for the purpose
of effecting such distribution, including the sale of such securities or
property.
The Deposit Agreement will also contain provisions relating to the manner in
which any subscription or similar rights offered by the Company to holders of
the Preferred Stock shall be made available to holders of Depositary Receipts.
The amount distributed in all of the foregoing cases will be reduced by any
amounts required to be withheld by the Company or the Depositary on account of
taxes and governmental charges.
REDEMPTION OF DEPOSITARY SHARES
If a series of the Preferred Stock represented by Depositary Shares is subject
to redemption, the Depositary Shares will be redeemed from the proceeds received
by the Depositary resulting from the redemption, in whole or in part, of such
series of the Preferred Stock held by the Depositary. The Depositary shall mail
notice of redemption not less than 30 and not more than 60 days prior to the
date fixed for redemption to the record holders of the Depositary Receipts
evidencing the Depositary Shares to be so redeemed at their respective addresses
appearing in the Depositary's books. The redemption price per Depositary Share
will be equal to the applicable fraction of the redemption price per share
payable with respect to such series of the Preferred Stock plus all money and
other property, if any, payable with respect to such Depositary Share, including
all amounts payable by the Company in respect of any accumulated but unpaid
dividends; provided, however, the Depositary may deduct such fees and charges as
are expressly provided in the Deposit Agreement for the account of the holders
of Depositary Receipts. Whenever the Company redeems shares of Preferred Stock
held by the Depositary, the Depositary will redeem as of the same redemption
date the number of Depositary Shares representing shares of Preferred Stock so
redeemed. If less than all the Depositary Shares are to be redeemed, the
Depositary Shares to be redeemed will be selected by lot or pro rata (subject to
rounding to avoid fractions of Depositary Shares) as may be determined by the
Depositary.
After the date fixed for redemption, the Depositary Shares so called for
redemption will no longer be deemed to be outstanding and all rights of the
holders of Depositary Receipts evidencing such Depositary Shares will cease,
except the right to receive without interest the moneys payable upon such
redemption and any money or other property to which such holders were entitled
upon such redemption upon surrender to the Depositary of the Depositary Receipts
evidencing such Depositary Shares.
VOTING THE PREFERRED STOCK
Upon receipt of notice of any meeting or action to be taken by written consent
at or as to which the holders of the Preferred Stock are entitled to vote or
consent, the Depositary will mail the information contained in such notice of
meeting or action to the record holders of the Depositary Receipts evidencing
the Depositary Shares
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relating to such Preferred Stock. Each record holder of such Depositary
Receipts on the record date (which will be the same date as the record date for
the Preferred Stock) will be entitled to instruct the Depositary as to the
exercise of the voting rights or the giving or refusal of consent, as the case
may be, pertaining to the number of shares of the Preferred Stock represented by
the Depositary Shares evidenced by such holder's Depositary Receipts. The
Depositary will endeavor, insofar as practicable, to vote, or give or withhold
consent with respect to, the maximum number of whole shares of the Preferred
Stock represented by all Depositary Shares as to which any particular voting or
consent instructions are received, and the Company will agree to take all action
which may be deemed necessary by the Depositary in order to enable the
Depositary to do so. The Depositary will abstain from voting, or giving
consents with respect to, shares of the Preferred Stock to the extent it does
not receive specific instructions from the holders of Depositary Receipts
evidencing Depositary Shares representing such Preferred Stock.
AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT
The form of Depositary Receipt evidencing the Depositary Shares relating to
any series of Preferred Stock and any provision of the related Deposit Agreement
may at any time and from time to time be amended by agreement between the
Company and the Depositary in any respect which they may deem necessary or
desirable. However, any amendment which imposes or increases any fees, taxes or
charges upon holders of Depositary Shares or Depositary Receipts relating to any
series of Preferred Stock or which materially and adversely alters the existing
rights of such holders will not be effective unless such amendment has been
approved by the record holders of Depositary Receipts evidencing at least a
majority of such Depositary Shares then outstanding. Notwithstanding the
foregoing, no such amendment may impair the right of any holder of Depositary
Shares or Depositary Receipts to receive any moneys or other property to which
such holder may be entitled under the terms of such Depositary Receipts or the
Deposit Agreement at the times and in the manner and amount provided for
therein. A Deposit Agreement may be terminated by the Company or the Depositary
only after (i) all outstanding Depositary Shares relating thereto have been
redeemed and any accumulated and unpaid dividends on the Preferred Stock
represented by the Depositary Shares, together with all other moneys and
property, if any, to which holders of the related Depositary Receipts are
entitled under the terms of such Depositary Receipts or the related Deposit
Agreement, have been paid or distributed as provided in the Deposit Agreement or
provision therefor has been duly made, (ii) there has been a final distribution
in respect of the Preferred Stock of the relevant series in connection with any
liquidation, dissolution or winding up of the Company and such distribution has
been distributed to the holders of the related Depositary Receipts, or (iii) in
the event the Depositary Shares relate to a series of Preferred Stock which is
convertible into shares of Common Stock, all outstanding Depositary Shares have
been converted into shares of Common Stock; provided, however, that resignation
and removal of the Depositary, and appointment of a successor Depositary shall
not constitute a termination of a Deposit Agreement.
MISCELLANEOUS
The Depositary will forward to record holders of Depositary Receipts, at their
respective addresses appearing in the Depositary's books, all reports and
communications from the Company which are delivered to the Depositary and which
the Company is required to furnish to the holders of the Preferred Stock or
Depositary Receipts.
The Company will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. The Company
will pay charges of the Depositary in connection with the initial deposit of the
Preferred Stock and the initial issuance of the Depositary Receipts evidencing
the Depositary Shares, any redemption of the Preferred Stock and any withdrawals
of Preferred Stock by the holders of Depositary Shares. Holders of Depositary
Shares will pay other transfer and other taxes and governmental charges and such
other charges as are expressly provided in the Deposit Agreement to be for their
accounts which may be deducted from payments otherwise due to such holders with
respect to their Depositary Receipts.
The Deposit Agreement will contain provisions relating to adjustments in the
fraction of a share of Preferred Stock represented by a Depositary Share in the
event of a change in par or stated value, split-up, combination
15
<PAGE>
or other reclassification of the Preferred Stock or upon any recapitalization,
merger or sale of substantially all of the assets of the Company.
Neither the Depositary nor any of its agents nor any registrar nor the Company
will be (i) liable if it is prevented or delayed by law or any circumstance
beyond its control in performing its obligations under the Deposit Agreement,
(ii) subject to any liability under the Deposit Agreement to holders of
Depositary Receipts other than for the relevant party's gross negligence or
willful misconduct or (iii) obligated to prosecute or defend any legal
proceeding in respect of any Depositary Receipts, Depositary Shares or the
Preferred Stock unless satisfactory indemnity is furnished. They may rely upon
written advice of counsel or accountants, or information provided by holders of
Depositary Receipts or other persons in good faith believed to be competent and
on documents reasonably believed to be genuine.
RESIGNATION OR REMOVAL OF DEPOSITARY
The Depositary may resign at any time by delivering to the Company notice of
its election to do so, and the Company may at any time remove the Depositary,
any such resignation or removal to take effect upon the appointment of a
successor Depositary and its acceptance of such appointment. Such successor
Depositary must be appointed within 60 days after delivery of the notice of
resignation or removal.
DESCRIPTION OF COMMON STOCK
COMMON STOCK
All shares of Common Stock participate equally in dividends payable to
stockholders of Common Stock when and as declared by the Board of Directors and
in net assets available for distribution to stockholders of Common Stock on
liquidation or dissolution, have one vote per share on all matters submitted to
a vote of the stockholders and do not have cumulative voting rights in the
election of directors. All issued and outstanding shares of Common Stock are,
and the Common Stock offered hereby will be upon issuance, validly issued, fully
paid and nonassessable. Holders of the Common Stock do not have preference,
conversion, exchange or preemptive rights. The Common Stock is listed on the
New York Stock Exchange (NYSE Symbol: NHP).
REDEMPTION AND BUSINESS COMBINATION PROVISIONS
If the Board of Directors shall, at any time and in good faith, be of the
opinion that direct or indirect ownership of at least 9.9% or more of the voting
shares of capital stock has or may become concentrated in the hands of one
beneficial owner, the Board of Directors shall have the power (i) by lot or
other means deemed equitable by it to call for the purchase from any stockholder
of the Company a number of voting shares sufficient, in the opinion of the Board
of Directors, to maintain or bring the direct or indirect ownership of voting
shares of capital stock of such beneficial owner to a level of no more than 9.9%
of the outstanding voting shares of the Company's capital stock, and (ii) to
refuse to transfer or issue voting shares of capital stock to any person whose
acquisition of such voting shares would, in the opinion of the Board of
Directors, result in the direct or indirect ownership by that person of more
than 9.9% of the outstanding voting shares of capital stock of the Company.
Further, any transfer of shares, options, warrants or other securities
convertible into voting shares that would create a beneficial owner of more than
9.9% of the outstanding voting shares shall be deemed void ab initio and the
intended transferee shall be deemed never to have had an interest therein. The
purchase price for any voting shares of capital stock so redeemed shall be equal
to the fair market value of the shares reflected in the closing sales price for
the shares, if then listed on a national securities exchange, or the average of
the closing sales prices for the shares if then listed on more than one national
securities exchange, or if the shares are not then listed on a national
securities exchange, the latest bid quotation for the shares if then traded
over-the-counter, on the last business day immediately preceding the day on
which notices of such acquisitions are sent by the Company, or, if no such
closing sales prices or quotations are available, then the purchase price shall
be equal to the net asset value of such stock as determined by the Board of
Directors in accordance with the provisions of applicable law. From and after
the date fixed for purchase by the Board of Directors, the holder
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<PAGE>
of any shares so called for purchase shall cease to be entitled to
distributions, voting rights and other benefits with respect to such shares,
except the right to payment of the purchase price for the shares.
The Articles of Incorporation require that, except in certain circumstances,
Business Combinations (as defined) between the Company and a beneficial holder
of 10% or more of the Company's outstanding voting stock (a "Related Person") be
approved by the affirmative vote of at least 90% of the outstanding voting
shares of the Company.
A Business Combination is defined in the Articles of Incorporation as (a) any
merger or consolidation of the Company with or into a Related Person, (b) any
sale, lease, exchange, transfer or other disposition, including without
limitation a mortgage or any other security device, of all or any "Substantial
Part" (as defined below) of the assets of the Company (including without
limitation any voting securities of a subsidiary) to a Related Person, (c) any
merger or consolidation of a Related Person with or into the Company, (d) any
sale, lease, exchange, transfer or other disposition of all or any Substantial
Part of the assets of a Related Person to the Company, (e) the issuance of any
securities (other than by way of pro rata distribution to all stockholders) of
the Company to a Related Person, and (f) any agreement, contract or other
arrangement providing for any of the transactions described in the definition of
Business Combination. The term "Substantial Part" shall mean more than 10% of
the book value of the total assets of the Company as of the end of its most
recent fiscal year ending prior to the time the determination is being made.
Pursuant to the Articles of Incorporation, the Company's Board of Directors is
classified into three classes. Each class of directors serves for a term of
three years, with one class being elected each year. As of the date of this
Prospectus, there are six directors, divided into three classes consisting of
one, two and three directors, respectively.
The foregoing provisions of the Articles of Incorporation and certain other
matters may not be amended without the affirmative vote of at least 90% of the
outstanding voting shares of the Company.
The foregoing provisions may have the effect of discouraging unilateral tender
offers or other takeover proposals which certain stockholders might deem in
their interests or in which they might receive a substantial premium. The Board
of Directors' authority to issue and establish the terms of currently authorized
Preferred Stock, without stockholder approval, may also have the effect of
discouraging takeover attempts. See "Description of Preferred Stock." The
provisions could also have the effect of insulating current management against
the possibility of removal and could, by possibly reducing temporary
fluctuations in market price caused by accumulations of shares, deprive
stockholders of opportunities to sell at a temporarily higher market price.
However, the Board of Directors believes that inclusion of the Business
Combination provisions in the Articles of Incorporation may help assure fair
treatment of stockholders and preserve the assets of the Company.
The foregoing summary of certain provisions of the Articles of Incorporation
does not purport to be complete or to give effect to provisions of statutory or
common law. The foregoing summary is subject to, and qualified in its entirety
by reference to, the provisions of applicable law and the Articles of
Incorporation, a copy of which is incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part.
TRANSFER AGENT AND REGISTRAR
ChaseMellon Shareholder Services LLC is the transfer agent and registrar of
the Common Stock.
DESCRIPTION OF SECURITIES WARRANTS
The Company may issue Securities Warrants for the purchase of Debt Securities,
Preferred Stock, Depositary Shares or Common Stock. Securities Warrants may be
issued independently or together with Debt Securities, Preferred Stock,
Depositary Shares or Common Stock offered by any Prospectus Supplement and may
17
<PAGE>
be attached to or separate from such Debt Securities, Preferred Stock,
Depositary Shares or Common Stock. Each series of Securities Warrants will be
issued under a separate warrant agreement (a "Securities Warrant Agreement") to
be entered into between the Company and a bank or trust company, as Securities
Warrant agent, all as set forth in the Prospectus Supplement relating to the
particular issue of offered Securities Warrants. The Securities Warrant agent
will act solely as an agent of the Company in connection with the Securities
Warrant certificates relating to the Securities Warrants and will not assume any
obligation or relationship of agency or trust for or with any holders of
Securities Warrant certificates or beneficial owners of Securities Warrants.
The following summaries of certain provisions of the Securities Warrant
Agreement and Securities Warrants do not purport to be complete and are subject
to, and are qualified in their entirety by reference to, all the provisions of
the Securities Warrant Agreement and the Securities Warrant certificates
relating to each series of Security Warrants which will be filed with the
Commission and incorporated by reference as an exhibit to the Registration
Statement of which this Prospectus is a part at or prior to the time of the
issuance of such series of Securities Warrants.
If Securities Warrants are offered, the applicable Prospectus Supplement will
describe the terms of such Securities Warrants, including, in the case of
Securities Warrants for the purchase of Debt Securities, the following where
applicable: (i) the offering price; (ii) the denominations and terms of the
series of Debt Securities purchasable upon exercise of such Securities Warrants;
(iii) the designation and terms of any series of Debt Securities, Preferred
Stock or Depositary Shares with which such Securities Warrants are being offered
and the number of such Securities Warrants being offered with each such Debt
Security, Preferred Stock or Depositary Share; (iv) the date, if any, on and
after which such Securities Warrants and the related series of Debt Securities,
Preferred Stock or Depositary Shares will be transferable separately; (v) the
principal amount of the series of Debt Securities purchasable upon exercise of
each such Securities Warrant and the price at which such principal amount of
Debt Securities of such series may be purchased upon such exercise; (vi) the
date on which the right to exercise such Securities Warrants shall commence and
the date (the "Expiration Date") on which such right shall expire; (vii) whether
the Securities Warrants will be issued in registered or bearer form; (viii) any
special United States Federal income tax consequences; (ix) the terms, if any,
on which the Company may accelerate the date by which the Securities Warrants
must be exercised; and (x) any other terms of such Securities Warrants.
In the case of Securities Warrants for the purchase of Preferred Stock,
Depositary Shares or Common Stock, the applicable Prospectus Supplement will
describe the terms of such Securities Warrants, including the following where
applicable: (i) the offering price; (ii) the aggregate number of shares
purchasable upon exercise of such Securities Warrants, the exercise price, and
in the case of Securities Warrants for Preferred Stock or Depositary Shares, the
designation, aggregate number and terms of the series of Preferred Stock
purchasable upon exercise of such Securities Warrants or underlying the
Depositary Shares purchasable upon exercise of such Securities Warrants; (iii)
the designation and terms of the series of Debt Securities, Preferred Stock or
Depositary Shares with which such Securities Warrants are being offered and the
number of such Securities Warrants being offered with each such Debt Security,
Preferred Stock or Depositary Share; (iv) the date, if any, on and after which
such Securities Warrants and the related series of Debt Securities, Preferred
Stock, Depositary Shares or Common Stock will be transferable separately; (v)
the date on which the right to exercise such Securities Warrants shall commence
and the Expiration Date; (vi) any special United States Federal income tax
consequences; and (vii) any other terms of such Securities Warrants.
Securities Warrant certificates may be exchanged for new Securities Warrant
certificates of different denominations, may (if in registered form) be
presented for registration of transfer, and may be exercised at the corporate
trust office of the Securities Warrant agent or any other office indicated in
the applicable Prospectus Supplement. Prior to the exercise of any Securities
Warrant to purchase Debt Securities, holders of such Securities Warrants will
not have any of the rights of holders of the Debt Securities purchasable upon
such exercise, including the right to receive payments of principal of, premium,
if any, or interest, if any, on such Debt Securities or to enforce covenants in
the applicable indenture. Prior to the exercise of any Securities Warrants to
purchase Preferred Stock, Depositary Shares or Common Stock, holders of such
Securities Warrants will not have any rights of holders of such Preferred Stock,
Depositary Shares or Common Stock, including the right to
18
<PAGE>
receive payments of dividends, if any, on such Preferred Stock or Common Stock,
or to exercise any applicable right to vote.
CERTAIN RISK CONSIDERATIONS
Any Securities Warrants issued by the Company will involve a certain degree of
risk, including risks arising from fluctuations in the price of the underlying
securities and general risks applicable to the stock market (or markets) on
which the underlying securities are traded.
Prospective purchasers of the Securities Warrants should recognize that the
Securities Warrants may expire worthless and, thus, purchasers should be
prepared to sustain a total loss of the purchase price of their Securities
Warrants. This risk reflects the nature of a Securities Warrant as an asset
which, other factors held constant, tends to decline in value over time and
which may, depending on the price of the underlying securities, become worthless
when it expires. The trading price of a Securities Warrant at any time is
expected to increase if the price, or, if applicable, dividend rate on the
underlying securities, increases. Conversely, the trading price of a Securities
Warrant is expected to decrease as the time remaining to expiration of the
Securities Warrant decreases and as the price or, if applicable, dividend rate
on the underlying securities, decreases. Assuming all other factors are held
constant, the more a Securities Warrant is "out-of-the-money" (i.e., the more
the exercise price exceeds the price of the underlying securities and the
shorter its remaining term to expiration), the greater the risk that a purchaser
of the Securities Warrant will lose all or part of his or her investment. If
the price of the underlying securities does not rise before the Securities
Warrant expires to an extent sufficient to cover a purchaser's cost of the
Securities Warrant, the purchaser will lose all or part of his or her investment
in such Securities Warrant upon expiration.
In addition, prospective purchasers of the Securities Warrants should be
experienced with respect to options and option transactions and understand the
risks associated with options and should reach an investment decision only after
careful consideration, with their financial advisers, of the suitability of the
Securities Warrants in light of their particular financial circumstances and the
information discussed herein and, if applicable, the Prospectus Supplement.
Before purchasing, exercising or selling any Securities Warrants, prospective
purchasers and holders of Securities Warrants should carefully consider, among
other things, (i) the trading price of the Securities Warrants, (ii) the price
of the underlying securities at such time, (iii) the time remaining to
expiration and (iv) any related transaction costs. Some of the factors referred
to above are in turn influenced by various political, economic and other factors
that can affect the trading price of the underlying securities and should be
carefully considered prior to making any investment decisions.
Purchasers of the Securities Warrants should further consider that the initial
offering price of the Securities Warrants may be in excess of the price that a
purchaser of options might pay for a comparable option in a private, less liquid
transaction. In addition, it is not possible to predict the price at which the
Securities Warrants will trade in the secondary market or whether any such
market will be liquid. The Company may, but is not obligated to, file an
application to list any Securities Warrants issued on a United States national
securities exchange. To the extent that any Securities Warrants are exercised,
the number of Securities Warrants outstanding will decrease, which may result in
a lessening of the liquidity of the Securities Warrants. Finally, the
Securities Warrants will constitute direct, unconditional and unsecured
obligations of the Company and as such will be subject to any changes in the
perceived creditworthiness of the Company.
EXERCISE OF SECURITIES WARRANTS
Each Securities Warrant will entitle the holder thereof to purchase such
principal amount of Debt Securities or number of shares of Preferred Stock,
Depositary Shares or Common Stock, as the case may be, at such exercise price as
shall in each case be set forth in, or calculable from, the Prospectus
Supplement relating to the offered Securities Warrants. After the close of
business on the Expiration Date (or such later date to which such Expiration
Date may be extended by the Company), unexercised Securities Warrants will
become void.
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Securities Warrants may be exercised by delivering to the Securities Warrant
agent payment as provided in the applicable Prospectus Supplement of the amount
required to purchase the Debt Securities, Preferred Stock, Depositary Shares or
Common Stock, as the case may be, purchasable upon such exercise together with
certain information set forth on the reverse side of the Securities Warrant
certificate. Securities Warrants will be deemed to have been exercised upon
receipt of payment of the exercise price, subject to the receipt within five (5)
business days, of the Securities Warrant certificate evidencing such Securities
Warrants. Upon receipt of such payment and the Securities Warrant certificate
properly completed and duly executed at the corporate trust office of the
Securities Warrant agent or any other office indicated in the applicable
Prospectus Supplement, the Company will, as soon as practicable, issue and
deliver the Debt Securities, Preferred Stock, Depositary Shares or Common Stock,
as the case may be, purchasable upon such exercise. If fewer than all of the
Securities Warrants represented by such Securities Warrant certificate are
exercised, a new Securities Warrant certificate will be issued for the remaining
amount of Securities Warrants.
AMENDMENTS AND SUPPLEMENTS TO SECURITIES WARRANT AGREEMENT
The Securities Warrant Agreements may be amended or supplemented without the
consent of the holders of the Securities Warrants issued thereunder to effect
changes that are not inconsistent with the provisions of the Securities Warrants
and that do not adversely affect the interests of the holders of the Securities
Warrants.
COMMON STOCK WARRANT ADJUSTMENTS
Unless otherwise indicated in the applicable Prospectus Supplement, the
exercise price of, and the number of shares of Common Stock covered by, a Common
Stock Warrant are subject to adjustment in certain events, including (i) payment
of a dividend on the Common Stock payable in capital stock and stock splits,
combinations or reclassifications of the Common Stock, (ii) issuance to all
holders of Common Stock of rights or warrants to subscribe for or purchase
shares of Common Stock at less than their current market price (as defined in
the Securities Warrant Agreement for such series of Common Stock Warrants), and
(iii) certain distributions of evidences of indebtedness or assets (including
securities but excluding cash dividends or distributions paid out of
consolidated earnings or retained earnings or dividends payable in Common Stock)
or of subscription rights and warrants (excluding those referred to above).
No adjustment in the exercise price of, and the number of shares of Common
Stock covered by, a Common Stock Warrant will be made for regular quarterly or
other periodic or recurring cash dividends or distributions or for cash
dividends or distributions to the extent paid from consolidated earnings or
retained earnings. No adjustment will be required unless such adjustment would
require a change of at least 1% in the exercise price then in effect. Except as
stated above, the exercise price of, and the number of shares of Common Stock
covered by, a Common Stock Warrant will not be adjusted for the issuance of
Common Stock or any securities convertible into or exchangeable for Common
Stock, or carrying the right or option to purchase or otherwise acquire the
foregoing, in exchange for cash, other property or services.
In the event of any (i) consolidation or merger of the Company with or into
any entity (other than a consolidation or a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding shares of
Common Stock), (ii) sale, transfer, lease or conveyance of all or substantially
all of the assets of the Company or (iii) reclassification, capital
reorganization or change of the Common Stock (other than solely a change in par
value or from par value to no par value), then any holder of a Common Stock
Warrant will be entitled, on or after the occurrence of any such event, to
receive on exercise of such Common Stock Warrant the kind and amount of shares
of stock or other securities, cash or other property (or any combination
thereof) that the holder would have received had such holder exercised such
holder's Common Stock Warrant immediately prior to the occurrence of such event.
If the consideration to be received upon exercise of the Common Stock Warrant
following any such event consists of common stock of the surviving entity, then
from and after the occurrence of such event, the exercise price of such Common
Stock Warrant will be subject to the same anti-dilution and other adjustments
described in the second preceding paragraph, applied as if such common stock
were Common Stock.
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<PAGE>
PLAN OF DISTRIBUTION
The Company may sell the Securities to one or more underwriters for public
offering and sale by them or may sell the Securities to investors directory or
through agents. Any such underwriter or agent involved in the offer and sale of
Securities will be named in the applicable Prospectus Supplement. The Company
has reserved the right to sell Securities directly to investors on its own
behalf in those jurisdictions where and in such manner as it is authorized to do
so.
Underwriters may offer and sell Securities at a fixed price or prices, which
may be changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at negotiated prices. The Company
also may offer and sell Securities in exchange for one or more of its
outstanding issues of the Securities or other securities. The Company also may,
from time to time, authorize dealers, acting as the Company's agents, to offer
and sell Securities upon the terms and conditions as are set forth in the
applicable Prospectus Supplement. In connection with the sale of Securities,
underwriters may receive compensation from the Company in the form of
underwriting discounts or commissions and may also receive commissions from
purchasers of the Securities for whom they may act as agent. Underwriters may
sell Securities to or through dealers, and such dealers may receive compensation
in the form of discounts, concessions or commissions from the underwriters
and/or commissions from the purchasers for whom they may act as agent.
Any underwriting compensation paid by the Company to underwriters or agents in
connection with the offering of Securities, and any discounts, concessions or
commissions allowed by underwriters to participating dealers, will be set forth
in the applicable Prospectus Supplement. Dealers and agents participating in
the distribution of Securities may be deemed to be underwriters, and any
discounts and commissions received by them and any profit realized by them on
resale of the Securities may be deemed to be underwriting discounts and
commissions. Underwriters, dealers and agents may be entitled, under agreements
entered into with the Company, to indemnification against and contribution
toward certain civil liabilities.
If so indicated in the Prospectus Supplement, the Company will authorize
dealers acting as the Company's agents to solicit offers by certain institutions
to purchase the Securities from the Company at the public offering price set
forth in the applicable Prospectus Supplement pursuant to delayed delivery
contracts ("Contracts") providing for payment and delivery on the date or dates
stated in such Prospectus Supplement. Each Contract will be for an amount not
less than, and the aggregate principal amount of the Securities sold pursuant to
Contracts shall be not less nor more than, the respective amounts stated in the
applicable Prospectus Supplement. Institutions with whom Contracts, when
authorized, may be made include commercial and savings banks, insurance
companies, pension funds, investment companies, educational and charitable
institutions, and other institutions but will in all cases be subject to the
approval of the Company. Contracts will not be subject to any conditions except
(i) the purchase by an institution of the Securities covered by its Contracts
shall not at the time of delivery be prohibited under the laws of any
jurisdiction in the United States to which such institution is subject, and (ii)
if the Securities are being sold to underwriters, the Company shall have sold to
such underwriters the total principal amount of such Securities less the
principal amount thereof covered by Contracts.
The net proceeds to the Company from the sale of the Securities will be the
purchase price of the Securities less any such discounts or commissions and the
other attributable expenses of issuance and distribution.
LEGAL MATTERS
The validity of the Securities offered hereby will be passed upon for the
Company by O'Melveny & Myers LLP. In addition, O'Melveny & Myers LLP has passed
upon certain federal income tax matters relating to the Company.
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EXPERTS
The consolidated balance sheets of the Company as of December 31, 1995, 1994,
1993, 1992, and 1991 and the consolidated statements of operations,
stockholders' equity and cash flows for each of the five years in the period
ended December 31, 1995, incorporated by reference in this Prospectus and
elsewhere in the Registration Statement, have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their report with respect
thereto, and are incorporated by reference herein in reliance upon the authority
of said firm as experts in accounting and auditing in giving said reports.
22
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No dealer, salesman or other person has been authorized to give any information
or to make any representations other than those contained or incorporated by
reference in this Prospectus in connection with the offer made by this
Prospectus and, if given or made, such information or representations must not
be relied upon as having been authorized by the Company or any underwriter,
dealer or agent. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create an implication that there has
been no change in the affairs of the Company since the date hereof. This
Prospectus does not constitute an offer or solicitation by anyone in any state
in which such offer or solicitation is not authorized or in which the person
making such offer or solicitation is not qualified to do so or to anyone to whom
it is unlawful to make such offer or solicitation.
_______________________
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
AVAILABLE INFORMATION................ 2
INCORPORATION OF CERTAIN DOCUMENTS BY
REFERENCE........................ 2
THE COMPANY.......................... 3
SELECTED CONSOLIDATED FINANCIAL
INFORMATION......................... 4
RATIO OF EARNINGS TO FIXED CHARGES... 5
USE OF PROCEEDS...................... 5
DESCRIPTION OF DEBT SECURITIES....... 5
DESCRIPTION OF PREFERRED STOCK....... 9
DESCRIPTION OF DEPOSITARY SHARES..... 13
DESCRIPTION OF COMMON STOCK.......... 16
DESCRIPTION OF SECURITIES WARRANTS... 17
PLAN OF DISTRIBUTION................. 21
LEGAL MATTERS........................ 21
EXPERTS.............................. 22
</TABLE>
=============================================================================
=============================================================================
$300,000,000
NATIONWIDE HEALTH
PROPERTIES, INC.
SECURITIES
____________________
PROSPECTUS
____________________
November 27, 1996
================================================================================
<PAGE>
PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The expenses of this offering are estimated as follows:
<TABLE>
<CAPTION>
<S> <C>
SEC Registration Fee.................................. $ 90,910
Blue Sky fees and expenses............................ 15,000
Printing and engraving expenses....................... 50,000
Legal fees and expenses............................... 100,000
Accounting fees and expenses.......................... 50,000
Transfer agent or trustee fees........................ 15,000
Miscellaneous......................................... 4,090
--------
Total............................................... $325,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
The Articles of Incorporation of the Company provide for indemnification of
directors and officers to the full extent permitted by the laws of the State of
Maryland.
Section 2-418 of the Maryland General Corporation Law generally permits
indemnification of any director or officer made a party to any proceedings by
reason of service as a director or officer unless it is established that (i) the
act or omission of such person was material to the matter giving rise to the
proceeding and was committed in bad faith or was the result of active and
deliberate dishonesty; or (ii) such person actually received an improper
personal benefit in money, property or services; or (iii) in the case of any
criminal proceeding, such person had reasonable cause to believe that the act or
omission was unlawful. The indemnity may include judgments, penalties, fines,
settlements and reasonable expenses actually incurred by the director or officer
in connection with the proceeding; provided, however, that if the proceeding is
one by, or in the right of the corporation, indemnification is not permitted
with respect to any proceeding in which the director or officer has been
adjudged to be liable to the corporation. The termination of any proceeding by
conviction or upon a plea of nolo contendere or its equivalent or upon an entry
of an order of probation prior to judgment creates a rebuttable presumption that
the director or officer did not meet the requisite standard of conduct required
for permitted indemnification. The termination of any proceeding by judgment,
order or settlement, however, does not create a presumption that the director or
officer failed to meet the requisite standard of conduct for permitted
indemnification.
The Company has entered into indemnity agreements with the officers and
directors of the Company that provide that the Company will pay on behalf of the
indemnified party any amount which the indemnified party is or becomes legally
obligated to pay because of any act or omission or neglect or breach of duty,
including any actual or alleged error or misstatement or misleading statement,
which the indemnified party commits or suffers while acting in the capacity as
an officer or director of the Company.
Since November 1986, the Company has had in force directors' and
officers' liability and Company reimbursement insurance covering liability for
error, misstatement, misleading statement, act or omission, and neglect or
breach of duty claimed against them solely by reason of their being directors or
officers of the Company.
II-1
<PAGE>
<TABLE>
<CAPTION>
ITEM 16. EXHIBITS.
EXHIBIT
NO. DESCRIPTION
- ------- -----------
<C> <S>
4.1(a) Amended and Restated Articles of Incorporation, filed as Exhibit 3.1 to
the Company's Registration Statement on Form S-11 (No. 33-1128),
effective December 19, 1985, and incorporated herein by this reference.
4.1(b) Articles of Amendment and Restated Articles of Incorporation of the
Company, filed as Exhibit 3.1 to the Company's Form 10-Q for the
quarter ended March 31, 1989, and incorporated herein by this
reference.
4.1(c) Articles of Amendment of Amended and Restated Articles of Incorporation
of the Company, filed as Exhibit 3.1(c) to the Company's Registration
Statement on Form S-11 (No. 33-32251), effective January 23, 1990, and
incorporated herein by this reference.
4.1(d) Articles of Amendment of Amended and Restated Articles of Incorporation
of the Company, filed as Exhibit 3.1(d) to the Company's Form 10-K for
the year ended December 31, 1994 and incorporated herein by this
reference.
4.2 Form of Indenture to be entered into between the Company and The Bank
of New York, as Trustee, and relating to the Debt Securities.
4.3 Form of Deposit Agreement.
4.4 Form of Depository Receipt (attached as Exhibit A to Deposit Agreement
included as Exhibit 4.3 hereto)
5.1 Opinion of O'Melveny & Myers LLP as to the validity of the Securities.
8.1 Opinion of O'Melveny & Myers LLP re tax matters.
12 Statement re Computation of Ratio of Earnings to Fixed Charges.
24.1 Consent of Arthur Andersen LLP (contained on page II-5).
24.2 Consent of O'Melveny & Myers LLP (included in Exhibit 5.1).
24.3 Consent of O'Melveny & Myers LLP (included in Exhibit 8.1).
25 Power of Attorney (contained on page II-4).
26 Form T-1 Statement of Eligibility and Qualification under the Trust
Indenture Act of 1939 of The Bank of New York, as Trustee (separately
bound).
</TABLE>
______________________________________
ITEM 17. UNDERTAKINGS.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers and controlling persons of
the registrant pursuant to the provisions described in Item 15 above, or
otherwise, the Registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Act and is, therefore, unenforceable.
II-2
<PAGE>
In the event that a claim for indemnification against such liabilities (other
than the repayment by the registrant of expenses incurred or paid by a director,
officer or controlling person of the Registrant in the successful defense of any
action, suit or proceeding) is asserted by such director, officer or controlling
person in connection with the securities being registered, the Registrant will,
unless in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act and
will be governed by the final adjudication of such issue.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933, unless the information required to be included in
such post-effective amendment is contained in periodic reports filed by
the Registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 and incorporated herein by reference;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth in
the Registration Statement, unless the information required to be
included in such post-effective amendment is contained in a periodic
report filed by the Registrant pursuant to Section 13 or Section 15(d) of
the Securities Exchange Act of 1934 and incorporated herein by reference;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the Registration Statement or
any material change to such information in the Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment shall be deemed to be a
new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(4) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the Registrant's annual report pursuant to
Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the Registration Statement shall be deemed to be
a new registration statement relating to the securities offered therein, and
the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Newport Beach, State of California, on the 27th day
of November, 1996.
NATIONWIDE HEALTH PROPERTIES, INC.
By: /s/ R. Bruce Andrews
-----------------------------------------
R. Bruce Andrews
President and Chief Executive Officer
POWER OF ATTORNEY
We, the undersigned directors and officers of Nationwide Health
Properties, Inc., do hereby constitute and appoint R. Bruce Andrews and Mark L.
Desmond, or either of them, our true and lawful attorneys and agents, to do any
and all acts and things in our name and behalf in our capacities as directors
and officers and to execute any and all instruments for us and in our names in
the capacities indicated below, which said attorneys and agents, or either of
them, may deem necessary or advisable to enable said corporation to comply with
the Securities Act of 1933, as amended, and any rules, regulations, and
requirements of the Securities and Exchange Commission, in connection with this
Registration Statement, including specifically, but without limitation, power
and authority to sign for us or any of us in our names and in the capacities
indicated below, any and all amendments (including post-effective amendments) to
this Registration Statement, or any related registration statement that is to be
effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933,
as amended; and we do hereby ratify and confirm all that the said attorneys and
agents, or either of them, shall do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities indicated on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- ---------------------------- --------------------------------------- -----------------
<S> <C> <C>
/s/ Milton J. Brock, Jr. Chairman and Director November 27, 1996
- ----------------------------
Milton J. Brock, Jr.
/s/ R. Bruce Andrews President, Chief Executive Officer and November 27, 1996
- ---------------------------- Director (Principal executive officer)
R. Bruce Andrews
/s/ Mark L. Desmond Senior Vice President and Chief November 27, 1996
- ---------------------------- Financial Officer (Principal financial
Mark L. Desmond and accounting officer)
/s/ David R. Banks Director November 27, 1996
- ----------------------------
David R. Banks
/s/ Sam A. Brooks Director November 27, 1996
- ----------------------------
Sam A. Brooks
/s/ Jack D. Samuelson Director November 27, 1996
- ----------------------------
Jack D. Samuelson
/s/ Charles D. Miller Director November 27, 1996
- ----------------------------
Charles D. Miller
</TABLE>
II-4
<PAGE>
EXHIBIT 24.1
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement of our reports dated January 31, 1996
included in Nationwide Health Properties, Inc.'s Form 10-K for the year ended
December 31, 1995 and to all references to our Firm included in this
registration statement.
ARTHUR ANDERSEN LLP
Orange County, California
November 26, 1996
II-5
<PAGE>
EXHIBIT 4.2
NATIONWIDE HEALTH PROPERTIES, INC.
AND
THE BANK OF NEW YORK,
Trustee
_________
INDENTURE
Dated as of ___________, 1996
_________
Debt Securities
<PAGE>
TABLE OF CONTENTS
____________
<TABLE>
<CAPTION>
Page
<S> <C>
Parties.......................................................... 1
Recitals......................................................... 1
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION................. 1
SECTION 101. Definitions............................................. 1
"Act"............................................................... 2
"Affiliate"......................................................... 2
"Authenticating Agent".............................................. 2
"Bearer Debt Security".............................................. 2
"Beneficial Owner".................................................. 2
"Board of Directors"................................................ 2
"Board Resolution".................................................. 3
"Business Day"...................................................... 3
"Common Stock"...................................................... 3
"Company"........................................................... 3
"Company Request" and "Company Order"............................... 3
"Corporate Trust Office"............................................ 3
"Corporation"....................................................... 3
"Coupon"............................................................ 3
"Debt Security" or "Debt Securities"................................ 3
"Debt Securities Register" and "Debt Securities
Registrar"....................................................... 4
"Defaulted Interest"................................................ 4
"Depositary"........................................................ 4
"Event of Default".................................................. 4
"Global Debt Security".............................................. 4
"Holder"............................................................ 4
"Indenture"......................................................... 4
"Interest Payment Date"............................................. 4
"Maturity".......................................................... 4
"Officers' Certificate"............................................. 5
"Opinion of Counsel"................................................ 5
"Original Issue Discount Debt Security"............................. 5
"Outstanding"....................................................... 5
"Paying Agent"...................................................... 6
"Person"............................................................ 6
"Place of Payment".................................................. 6
"Predecessor Debt Security"......................................... 6
"Redemption Date"................................................... 6
"Redemption Price".................................................. 7
"Registered Debt Security".......................................... 7
"Regular Record Date"............................................... 7
</TABLE>
i
<PAGE>
<TABLE>
<S> <C>
"REIT"......................................................... 7
"Responsible Officer".......................................... 7
"SEC".......................................................... 7
"Special Record Date".......................................... 7
"Stated Maturity".............................................. 7
"Subsidiary"................................................... 7
"TIA".......................................................... 7
"Trustee"...................................................... 7
"Voting Stock"................................................. 8
SECTION 102. Compliance Certificates and Opinions...................... 8
SECTION 103. Form of Documents Delivered to Trustee.................... 9
SECTION 104. Acts of Holders........................................... 9
SECTION 105. Notices, Etc., to Trustee and Company..................... 11
SECTION 106. Notices to Holders; Waiver................................ 12
SECTION 107. Communication by Holders with Other Holders............... 12
SECTION 108. Effect of Headings and Table of Contents.................. 13
SECTION 109. Successors and Assigns.................................... 13
SECTION 110. Separability Clause....................................... 13
SECTION 111. Benefits of Indenture..................................... 13
SECTION 112. Governing Law............................................. 13
SECTION 113. Legal Holidays............................................ 13
SECTION 114. Trust Indenture Act Controls.............................. 14
ARTICLE TWO
DEBT SECURITY FORMS...................... 14
SECTION 201. Form of Debt Securities.................................. 14
SECTION 202. Form of Trustee's Certificate of Authentication.......... 15
SECTION 203. Form of Trustee's Certificate of Authentication by
an Authenticating Agent.................................. 15
SECTION 204. Provisions in Global Debt Security....................... 16
ARTICLE THREE
THE DEBT SECURITIES........................ 17
SECTION 301. Amount Unlimited; Issuable in Series..................... 17
</TABLE>
ii
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 302. Denominations...................................... 20
SECTION 303. Execution, Authentication, Delivery and Dating..... 20
SECTION 304. Temporary Debt Securities.......................... 22
SECTION 305. Registration, Registration of Transfer and Exchange 22
SECTION 306. Mutilated, Destroyed, Lost and Stolen Debt
Securities......................................... 26
SECTION 307. Payment of Interest; Interest Rights Preserved..... 27
SECTION 308. Persons Deemed Owners.............................. 29
SECTION 309. Cancellation....................................... 29
SECTION 310. Computation of Interest............................ 30
ARTICLE FOUR
SATISFACTION AND DISCHARGE................. 30
SECTION 401. Satisfaction and Discharge of Indenture............ 30
SECTION 402. Application of Trust Money......................... 31
ARTICLE FIVE
REMEDIES......................... 32
SECTION 501. Events of Default.................................. 32
SECTION 502. Acceleration of Maturity; Rescission and Annulment. 34
SECTION 503. Collection of Indebtedness and Suits for
Enforcement by Trustee............................. 36
SECTION 504. Trustee May File Proofs of Claim................... 37
SECTION 505. Trustee May Enforce Claims Without Possession of
Debt Securities.................................... 38
SECTION 506. Application of Money Collected..................... 38
SECTION 507. Limitation on Suits................................ 38
SECTION 508. Unconditional Right of Holders to Receive
Principal, Premium and Interest.................... 39
SECTION 509. Restoration of Rights and Remedies................. 39
SECTION 510. Rights and Remedies Cumulative..................... 40
SECTION 511. Delay or Omission Not Waiver....................... 40
</TABLE>
iii
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 512. Control by Holders........................................... 40
SECTION 513. Waiver of Past Defaults...................................... 41
SECTION 514. Undertaking for Costs........................................ 42
SECTION 515. Waiver of Stay or Extension Laws............................. 42
ARTICLE SIX
THE TRUSTEE.................................. 42
SECTION 601. Certain Duties and Responsibilities.......................... 42
SECTION 602. Notice of Defaults........................................... 44
SECTION 603. Certain Rights of Trustee.................................... 44
SECTION 604. Not Responsible for Recitals or Issuance of Debt
Securities................................................... 46
SECTION 605. May Hold Debt Securities..................................... 46
SECTION 606. Money Held in Trust.......................................... 46
SECTION 607. Compensation, Reimbursement and Indemnity.................... 46
SECTION 608. Corporate Trustee Required; Eligibility...................... 47
SECTION 609. Resignation and Removal; Appointment of Successor............ 48
SECTION 610. Acceptance of Appointment by Successor....................... 50
SECTION 611. Merger, Conversion, Consolidation or Succession to
Business..................................................... 51
SECTION 612. Appointment of Authenticating Agent.......................... 52
SECTION 613. Preferential Collection of Claims Against Company............ 53
SECTION 614. Reports by Trustee to Holders................................ 53
SECTION 615. Other Capacities............................................. 53
SECTION 616. Notice of Default............................................ 54
ARTICLE SEVEN
HOLDERS' LISTS................................ 54
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.... 54
</TABLE>
iv
<PAGE>
<TABLE>
<S> <C> <C>
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE;
CREATION OF LIENS......................... 55
SECTION 801. Company May Consolidate, Etc.............................. 55
SECTION 802. Successor Corporation Substituted......................... 56
ARTICLE NINE
SUPPLEMENTAL INDENTURES..................... 56
SECTION 901. Supplemental Indentures Without Consent
of Holders.......................................... 56
SECTION 902. Supplemental Indentures with Consent of Holders........... 57
SECTION 903. Execution of Supplemental Indentures...................... 59
SECTION 904. Effect of Supplemental Indentures......................... 59
SECTION 905. Reference in Debt Securities to Supplemental
Indentures................................................ 59
ARTICLE TEN
COVENANTS............................. 60
SECTION 1001. Payment of Principal, Premium and Interest................ 60
SECTION 1002. Maintenance of Office or Agency........................... 60
SECTION 1003. Money for Debt Security Payments to be Held in
Trust..................................................... 61
SECTION 1004. Statement as to Compliance................................ 62
SECTION 1005. Waiver of Certain Covenants............................... 63
SECTION 1006. SEC Reports............................................... 63
SECTION 1007. Limitations on Dividends, Distributions and
Acquisitions of Capital Stock............................. 63
ARTICLE ELEVEN
REDEMPTION OF DEBT SECURITIES................... 64
SECTION 1101. Right of Redemption....................................... 64
SECTION 1102. Election to Redeem; Notice to Trustee..................... 64
SECTION 1103. Selection by Trustee of Debt Securities to be
Redeemed.................................................. 65
SECTION 1104. Notice of Redemption...................................... 65
</TABLE>
v
<PAGE>
<TABLE>
<S> <C> <C>
SECTION 1105. Deposit of Redemption Price............................... 66
SECTION 1106. Debt Securities Payable on Redemption Date................ 67
SECTION 1107. Debt Securities Redeemed in Part.......................... 67
ARTICLE TWELVE
SINKING FUND........................... 68
SECTION 1201. Mandatory and Optional Sinking Fund Payments.............. 68
SECTION 1202. Satisfaction of Sinking Fund Payments with Debt
Securities................................................ 68
SECTION 1203. Redemption of Debt Securities for Sinking Funds........... 69
ARTICLE THIRTEEN
CONVERSION OF DEBT SECURITIES.................. 70
SECTION 1301. Conversion Privilege...................................... 70
SECTION 1302. Exercise of Conversion Privilege.......................... 70
SECTION 1303. Fractions of Shares....................................... 71
SECTION 1304. Adjustments of Conversion Price........................... 72
SECTION 1305. Notice of Adjustments of Conversion Price................. 75
SECTION 1306. Notice of Certain Corporate Action........................ 75
SECTION 1307. Taxes on Conversions...................................... 76
ARTICLE FOURTEEN
RESTRICTIONS ON TRANSFER..................... 76
SECTION 1401. Restrictions on Transfer.................................. 76
</TABLE>
vi
<PAGE>
INDENTURE, dated as of ____________, 1996 between NATIONWIDE HEALTH
PROPERTIES, INC., a Maryland corporation (hereinafter called the "COMPANY"), and
THE BANK OF NEW YORK, a New York state banking corporation, as Trustee hereunder
(hereinafter called the "TRUSTEE").
RECITALS OF THE COMPANY
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of its unsecured and
unsubordinated debt securities, unlimited as to principal amount, to bear such
rates of interest, if any, to mature at such time or times, to be issued in one
or more series and to have such other provisions as shall be fixed as
hereinafter provided.
All things necessary to make this Indenture a valid agreement of the
Company, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH:
For and in consideration of the premises and the purchase of the Debt
Securities by the Holders thereof, it is mutually covenanted and agreed, for the
equal and proportionate benefit of all Holders of the Debt Securities or of any
series thereof, as follows:
ARTICLE ONE
DEFINITIONS AND OTHER PROVISIONS
OF GENERAL APPLICATION
SECTION 101. Definitions.
-----------
For all purposes of this Indenture, except as otherwise expressly
provided or unless the context otherwise requires:
(1) the terms defined in this Article have the meanings assigned to
them in this Article and include the plural as well as the singular;
(2) all other terms used herein which are defined in the TIA, either
directly or by reference therein, have the meanings assigned to them
therein;
(3) all accounting terms not otherwise defined herein have the
meanings assigned to them in accordance
1
<PAGE>
with generally accepted accounting principles, and the term "GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES" with respect to any computation required or
permitted hereunder shall mean such accounting principles which are
generally accepted at the date or time of such computation;
(4) the words "HEREIN," "HEREOF" and "HEREUNDER" and other words of
similar import refer to this Indenture as a whole and not to any particular
Article, Section or other subdivision;
(5) the word "OR" is always used inclusively (for example, the phrase
"A or B" means "A or B or both," not "either A or B but not both"); and
(6) nouns and pronouns of the masculine gender include the feminine
gender.
"ACT" when used with respect to any Holder has the meaning specified
in Section 104.
"AFFILIATE" of any specified Person means any other Person directly
or indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For the purpose of this definition,
"CONTROL" when used with respect to any specified Person means the power to
direct the management and policies of such Person, directly or indirectly,
whether through the ownership of voting securities, by contract or otherwise;
and the terms, "CONTROLLING" and "CONTROLLED" have meanings correlative to the
foregoing.
"AUTHENTICATING AGENT" means any Person which shall at the time be
appointed and acting, pursuant to Section 612, as an agent of the Trustee to
authenticate Debt Securities.
"BEARER DEBT SECURITY" means any Debt Security payable to bearer and,
unless the context otherwise requires, all coupons appertaining thereto.
"BENEFICIAL OWNER" means any Person who owns outstanding stock
directly or beneficially or who is deemed to be an actual or constructive owner
of such stock through the application of section 544, as modified by section
856(h)(1)(B), of the Internal Revenue Code of 1986, as amended. The terms
"BENEFICIAL OWNERSHIP" and "BENEFICIALLY OWN" shall have correlative meanings.
"BOARD OF DIRECTORS" means either the Board of Directors of the
Company or any committee of the Board duly authorized to act in any matter
relating hereto.
2
<PAGE>
"BOARD RESOLUTION" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors or a duly authorized committee thereof and to be in full
force and effect on the date of such certification, and delivered to the
Trustee.
"BUSINESS DAY" with respect to any Place of Payment means each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which banking
institutions are authorized or obligated by law or executive order to close in
any such Place of Payment, or such other day as provided in or pursuant to an
Officers' Certificate or supplemental indenture referred to in Section 301.
"COMMON STOCK" means the shares of common stock, $.10 par value per
share, of the Company.
"COMPANY" means the Person named as the "Company" in the first
paragraph of this instrument until a successor corporation shall have become
such pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation.
"COMPANY REQUEST" and "COMPANY ORDER" mean, respectively, a written
request or order signed in the name of the Company by the Chairman of the Board,
a Vice Chairman, the President, or a Vice President (whether or not designated
by a number or a word or words added before or after any such title), and by the
Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the
Secretary or an Assistant Secretary of the Company, and delivered to the
Trustee.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which at
any particular time its corporate trust business shall be principally conducted,
which office, at the date of execution of this Indenture, is located at 101
Barclay Street, 21st Floor, New York, New York 10286.
"CORPORATION", whether or not such term is capitalized, includes
corporations, associations, companies and business trusts.
"COUPON" means any interest coupon appertaining to a Bearer Debt
Security.
"DEBT SECURITY" or "DEBT SECURITIES" means any debt security or debt
securities, as the case may be, authenticated and delivered under this
Indenture.
3
<PAGE>
"DEBT SECURITIES REGISTER" and "DEBT SECURITIES REGISTRAR" have the
respective meanings specified in Section 305.
"DEFAULTED INTEREST" has the meaning specified in Section 307.
"DEPOSITARY" means, with respect to the Debt Securities of any series
issuable or issued in whole or in part in the form of a Global Debt Security,
the Person designated as Depositary by the Company pursuant to Section 301 until
a successor Depositary shall have become such pursuant to the applicable
procedures of this Indenture, and thereafter "Depositary" shall mean or include
each Person who is then a Depositary hereunder, and if at any time there is more
than one Person, "Depositary", as used with respect to the Debt Securities of
any such series, shall mean the Depositary with respect to the Debt Securities
of that series.
"EVENT OF DEFAULT" has the meaning specified in Section 501.
"GLOBAL DEBT SECURITY" means a Debt Security in the form prescribed in
Section 204 evidencing all or part of a series of Debt Securities, issued to the
Depositary for such series or its nominee, and registered in the name of such
Depositary or nominee.
"HOLDER" when used with respect to a Registered Debt Security means
the Person in whose name such Debt Security is registered in the Debt Securities
Register and, when used with respect to a Bearer Debt Security or a coupon,
means the bearer thereof.
"INDENTURE" means this instrument as originally executed or as it may
from time to time be supplemented or amended by one or more indentures
supplemental hereto entered into pursuant to the applicable provisions hereof,
and shall include the form and terms of particular Debt Securities as
established by or pursuant to each Board Resolution pursuant to Section 201 or
301.
"INTEREST PAYMENT DATE" with respect to any Debt Security means the
Stated Maturity of an installment of interest on such Debt Security.
"MATURITY" when used with respect to any Debt Security means the date
on which the principal of such Debt Security becomes due and payable as therein
or herein provided, whether at the Stated Maturity or by declaration of
acceleration, call for redemption or otherwise.
4
<PAGE>
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board, a Vice Chairman, the President or a Vice President (whether or not
designated by a number or a word or words added before or after any such title)
and by the Treasurer, an Assistant Treasurer, the Controller, an Assistant
Controller, the Secretary or an Assistant Secretary of the Company, and
delivered to the Trustee.
"OPINION OF COUNSEL" means a written opinion of counsel, who may be an
employee of or counsel for the Company or other counsel designated by the
Company, acceptable to the Trustee.
"ORIGINAL ISSUE DISCOUNT DEBT SECURITY" means a Debt Security which
provides for an amount less than the principal amount thereof to be due and
payable upon a declaration of acceleration of the Maturity thereof pursuant to
Section 502.
"OUTSTANDING" when used with respect to Debt Securities means, as of
the date of determination, all Debt Securities theretofore authenticated and
delivered under this Indenture, except:
------
(i) Debt Securities theretofore cancelled by the Trustee or delivered
to the Trustee for cancellation;
(ii) Debt Securities for whose payment or redemption money in the
necessary amount has been theretofore deposited with the Trustee or any
Paying Agent (other than the Company) in trust or set aside and segregated
in trust by the Company (if the Company shall act as its own Paying Agent)
for the Holders of such Debt Securities provided that, if such Debt
--------
Securities are to be redeemed, notice of such redemption has been duly
given pursuant to this Indenture or provision therefor satisfactory to the
Trustee has been made; and
(iii) Debt Securities which have been paid pursuant to Section 306 or
in exchange for or in lieu of which other Debt Securities have been
authenticated and delivered pursuant to this Indenture other than any such
Debt Securities in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Debt Securities are held by a
bona fide purchaser in whose hands such Debt Securities are valid
obligations of the Company;
provided, however, that in determining whether the Holders of the requisite
- -------- -------
principal amount of Outstanding Debt Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder, the principal
amount of an Original Issue Discount Debt Security
5
<PAGE>
that may be counted in making such determination and that shall be deemed to be
Outstanding for such purposes shall be equal to the amount of the principal
thereof that could be declared to be due and payable pursuant to the terms of
such Original Issue Discount Debt Security at the time the taking of such action
by the Holders of such requisite principal amount is evidenced to the Trustee as
provided in Section 104(a), and, provided further, that Debt Securities owned by
-------- -------
the Company or any other obligor upon the Debt Securities or any Affiliate of
the Company or such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in relying upon any such request, demand, authorization, direction, notice,
consent or waiver, only Debt Securities which a Responsible Officer of the
Trustee knows to be so owned shall be so disregarded. Debt Securities so owned
which have been pledged in good faith may be regarded as Outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Debt Securities and that the pledgee is not the Company
or any other obligor upon the Debt Securities or any Affiliate of the Company or
such other obligor.
"PAYING AGENT" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest, if any, on any Debt Securities
on behalf of the Company, and, subject to the provisions of Section 1003, may
include the Company.
"PERSON" means any individual, corporation, partnership, joint
venture, association, joint-stock company, trust, unincorporated organization or
government or any agency or political subdivision thereof.
"PLACE OF PAYMENT" when used with respect to the Debt Securities of
any series means the place or places where the principal of (and premium, if
any) and interest, if any, on the Debt Securities of that series are payable as
provided pursuant to Section 301.
"PREDECESSOR DEBT SECURITY" of any particular Debt Security means
every previous Debt Security evidencing all or a portion of the same debt as
that evidenced by such particular Debt Security and, for the purposes of this
definition, any Debt Security authenticated and delivered under Section 306 in
exchange for or in lieu of a mutilated, destroyed, lost or stolen Debt Security
shall be deemed to evidence the same debt as the mutilated, destroyed, lost or
stolen Debt Security.
"REDEMPTION DATE" when used with respect to any Debt Security to be
redeemed means the date fixed for such redemption by or pursuant to this
Indenture.
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<PAGE>
"REDEMPTION PRICE" when used with respect to any Debt Security to be
redeemed means the price at which it is to be redeemed pursuant to this
Indenture.
"REGISTERED DEBT SECURITY" means any Debt Security registered in the
Debt Securities Register.
"REGULAR RECORD DATE" for the interest payable on any Interest Payment
Date (other than at Maturity) on the Registered Debt Securities of any series
means the date specified for that purpose as contemplated by Section 301.
"REIT" means a real estate investment trust qualified under Sections
856-860 of the Internal Revenue Code of 1986, as amended.
"RESPONSIBLE OFFICER" when used with respect to the Trustee means any
officer of the Trustee assigned by the Trustee to administer its corporate trust
matters. In the absence of bad faith on the part of the Company or a Holder,
the Company or the Holder, as the case may be, may conclusively rely upon the
statement of an officer of the Trustee as to whether an officer (including the
officer making the statement) is assigned by the Trustee to administer the
Trustee's corporate trust matters.
"SEC" means the Securities and Exchange Commission.
"SPECIAL RECORD DATE" for the payment of any Defaulted Interest means
a date fixed by the Trustee pursuant to Section 307.
"STATED MATURITY" when used with respect to any Debt Security or any
installment of interest thereon means the date specified in such Debt Security
as the fixed date on which the principal of such Debt Security or such
installment of interest is due and payable.
"SUBSIDIARY" means any corporation at least a majority of the shares
of Voting Stock of which shall at the time be owned, directly or indirectly, by
the Company or by one or more Subsidiaries.
"TIA" means the Trust Indenture Act of 1939, as amended and as in
effect on the date above written.
"TRUSTEE" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
with respect to one or more series of Debt Securities pursuant to the applicable
provisions of this Indenture, and thereafter "Trustee" shall mean or include
each Person who is then a Trustee hereunder,
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<PAGE>
and if at any time there is more than one such Person, "Trustee" as used with
respect to the Debt Securities of any series shall mean exclusively the Trustee
with respect to the Debt Securities of that series.
"VOTING STOCK" when used with respect to the stock of any corporation
means stock of the class or classes having general voting power under ordinary
circumstances to elect at least a majority of the board of directors, managers
or trustees of such corporation (irrespective of whether or not at the time
stock of any other class or classes shall have or might have voting power by
reason of the happening of any contingency).
SECTION 102. Compliance Certificates and Opinions.
------------------------------------
Upon any application or request by the Company to the Trustee to take
any action under any provision of this Indenture, the Company shall furnish to
the Trustee an Officers' Certificate stating that all conditions precedent, if
any, provided for in this Indenture relating to the proposed action have been
complied with and an Opinion of Counsel stating that in the opinion of such
counsel all such conditions precedent, if any, have been complied with, except
that in the case of any such application or request as to which the furnishing
of such documents is specifically required by any provision of this Indenture
relating to such particular application or request, no additional certificate or
opinion need be furnished.
Every certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that each individual signing such certificate or
opinion has read such covenant or condition and the definitions herein
relating thereto;
(2) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(3) a statement that, in the opinion of each such individual, such
individual has made such examination or investigation as is necessary to
enable such individual to express an informed opinion as to whether or not
such covenant or condition has been complied with; and
(4) a statement as to whether, in the opinion of each such individual,
such condition or covenant has
been complied with.
8
<PAGE>
For purposes of this Section 102, the term "COMPANY" (whether directly
or indirectly used) also includes any other obligor.
SECTION 103. Form of Documents Delivered to Trustee.
--------------------------------------
In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all
such matters be certified by, or covered by the opinion of, only one such
Person, or that they be so certified or covered by only one document, but one
such Person may certify or give an opinion with respect to some matters and one
or more other such Persons as to other matters, and any such Person may certify
or give an opinion as to such matters in one or several documents.
Any certificate or opinion of an officer of the Company may be based,
insofar as it relates to legal matters, upon a certificate or opinion of, or
representations by, counsel, unless such officer knows, or in the exercise of
reasonable care should know, that the certificate or opinion or representations
with respect to the matters upon which his certificate or opinion is based are
erroneous. Any such certificate or Opinion of Counsel may be based, insofar as
it relates to factual matters, upon a certificate or opinion of, or
representations by, an officer or officers of the Company stating that the
information with respect to such factual matters is in the possession of the
Company, unless such counsel knows, or in the exercise of reasonable care should
know, that the certificate or opinion or representations with respect to such
matters are erroneous.
Where any Person is required to make, give or execute two or more
applications, requests, consents, certificates, statements, opinions or other
instruments under this Indenture, they may, but need not, be consolidated and
form one instrument.
SECTION 104. Acts of Holders.
---------------
(a) Any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by an agent duly
appointed in writing; and, except as herein otherwise expressly provided, such
action shall become effective when such instrument or instruments are delivered
to the Trustee and, where it is hereby expressly required, to the Company. Such
instrument or instruments (and the action embodied therein and evidenced
thereby) are
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<PAGE>
herein sometimes referred to as the "ACT" of the Holders signing such instrument
or instruments. Proof of execution of any such instrument or of a writing
appointing any such agent shall be sufficient for any purpose of this Indenture
and (subject to Section 601) conclusive in favor of the Trustee and the Company
and any agent of the Trustee or the Company, if made in the manner provided in
this Section.
(b) The fact and date of the execution by any Person of any such
instrument or writing may be proved by the affidavit of a witness of such
execution or by the certificate of any notary public or other officer authorized
by law to take acknowledgments of deeds, certifying that the individual signing
such instrument or writing acknowledged to him the execution thereof. Where
such execution is by a Person acting in other than his individual capacity, such
certificate or affidavit shall also constitute sufficient proof of his
authority.
(c) The fact and date of the execution by any Person of any such
instrument or writing, or the authority of the Person executing the same, may
also be proved in any other manner which the Trustee deems sufficient, and the
Trustee may in any instance require further proof with respect to any of the
matters referred to in this Section.
(d) The principal amount and serial number of any Bearer Debt Security
held by any Person, and the date of such Person's holding the same, may be
proved by the production of such Bearer Debt Security or by a certificate
executed, as depositary, by any trust company, bank, banker or other depositary,
wherever situated, if such certificate shall be deemed by the Company to be
satisfactory, showing that at the date therein mentioned such Person had on
deposit with such depositary, or exhibited to it, the Bearer Debt Security
therein described; or such facts may be proved by the certificate or affidavit
of the Person holding such Bearer Debt Security, if such certificate or
affidavit is deemed by the Company to be satisfactory. The Trustee and the
Company may assume that such ownership of any Bearer Debt Security continues
until (1) another certificate or affidavit bearing a later date issued in
respect of the same Bearer Debt Security is produced, or (2) such Bearer Debt
Security is produced to the Trustee by some other Person, or (3) such Bearer
Debt Security is surrendered in exchange for a Registered Debt Security, or (4)
such Bearer Debt Security is no longer Outstanding. The fact and date of
execution of any such instrument or writing, the authority of the Person
executing the same and the principal amount and serial number of any Bearer Debt
Security held by the Person so executing such instrument or writing and the date
of holding the same may also be proved in any other manner which the Company
deems sufficient; and the Company may in any
10
<PAGE>
instance require further proof with respect to any of the matters referred to in
this Section.
The principal amount and serial numbers of Registered Debt Securities
held by any Person, and the date of his holding the same, shall be proved by the
Debt Securities Register.
(e) If the Company shall solicit from the Holders any request, demand,
authorization, direction, notice, consent, waiver or other Act, the Company may,
at its option, by Board Resolution, fix in advance a record date for the
determination of Holders entitled to give such request, demand, authorization,
direction, notice, consent, waiver or other Act, but the Company shall have no
obligation to do so. If such a record date is fixed, such request, demand,
authorization, direction, notice, consent, waiver or other Act may be given
before or after such record date, but only the Holders at the close of business
on such record date shall be deemed to be Holders for the purposes of
determining whether Holders of the requisite proportion of Outstanding Debt
Securities have authorized or agreed or consented to such request, demand,
authorization, direction, notice, consent, waiver or other Act, and for that
purpose the Outstanding Debt Securities shall be computed as of such record
date; provided that no such authorization, agreement or consent by the Holders
on such record date shall be deemed effective unless it shall become effective
pursuant to the provisions of this Indenture not later than six months after the
record date.
(f) Any request, demand, authorization, direction, notice, consent,
waiver or other action by the Holder of any Debt Security shall bind every
future Holder of the same Debt Security and the Holder of every Debt Security
issued upon the registration of transfer thereof or in exchange therefor or in
lieu thereof in respect of anything done or suffered to be done by the Trustee,
any Debt Securities Registrar, any Paying Agent or the Company in reliance
thereon, whether or not notation of such action is made upon such Debt Security.
SECTION 105. Notices, Etc., to Trustee and Company.
-------------------------------------
Any request, demand, authorization, direction, notice, consent, waiver
or Act of Holders or other document provided or permitted by this Indenture to
be made upon, given or furnished to, or filed with,
(1) the Trustee by any Holder or by the Company shall be sufficient
for every purpose hereunder if made, given, furnished or filed in writing
to or with the Trustee at its Corporate Trust Office, or
11
<PAGE>
(2) the Company by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (except as otherwise provided in Section 501
hereof) if in writing and mailed, first-class postage prepaid, to the
Company addressed to the attention of its President at 4675 MacArthur
Court, Suite 1170, Newport Beach, California 92660 or at any other address
previously furnished in writing to the Trustee by the Company.
SECTION 106. Notices to Holders; Waiver.
--------------------------
Where this Indenture provides for notice to Holders of any event,
unless otherwise expressly provided herein or in the Officers' Certificate or
supplemental indenture referred to in Section 301 with respect to Debt
Securities of any series, such notice shall be sufficiently given if in writing
and mailed, first-class postage prepaid, to each Holder affected by such event,
at his address as it appears in the Debt Securities Register, not later than the
latest date, and not earlier than the earliest date, prescribed for the giving
of such notice. In any case where notice to Holders is given by mail, neither
the failure to mail such notice, nor any defect in any notice so mailed, to any
particular Holder shall affect the sufficiency of such notice with respect to
other Holders. Where this Indenture provides for notice in any manner, such
notice may be waived in writing by the Person entitled to receive such notice,
either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders shall be filed with the Trustee but
such filing shall not be a condition precedent to the validity of any action
taken in reliance upon such waiver.
In case by reason of any cause it shall be impracticable to give such
notice, then such notification as shall be made with the approval of the Trustee
shall constitute a sufficient notification for every purpose hereunder.
SECTION 107. Communication by Holders with Other Holders.
-------------------------------------------
Communication among Holders with respect to their rights under this
Indenture or the Debt Securities shall be made in accordance with the provisions
of TIA (S) 312(b). The Company, the Trustee, the Debt Securities Registrar or
any agent thereof shall be afforded the protection provided under TIA (S)
312(c).
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SECTION 108. Effect of Headings and Table of Contents.
----------------------------------------
The Article and Section headings herein and the Table of Contents are
for convenience only and shall not affect the construction hereof.
SECTION 109. Successors and Assigns.
----------------------
All covenants and agreements in this Indenture by the Company shall
bind its successors and assigns, whether so expressed or not.
SECTION 110. Separability Clause.
-------------------
In case any provision in this Indenture or in the Debt Securities
shall be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be affected or
impaired thereby.
SECTION 111. Benefits of Indenture.
---------------------
Nothing in this Indenture or in the Debt Securities, express or
implied, shall give to any Person, other than the parties hereto, any Debt
Securities Registrar, any Paying Agent, any Authenticating Agent and their
successors hereunder, and the Holders of Debt Securities, any benefit or any
legal or equitable right, remedy or claim under this Indenture.
SECTION 112. Governing Law.
-------------
This Indenture and the Debt Securities shall be deemed to be a
contract made under the laws of the State of New York and for all purposes shall
be governed by and construed in accordance with the internal laws of the State
of New York, except to the extent certain matters may be governed as a matter of
law by federal law.
SECTION 113. Legal Holidays.
--------------
In any case where any Interest Payment Date, Redemption Date or Stated
Maturity of any Debt Security shall not be a Business Day at a Place of Payment,
then (notwithstanding any other provision of this Indenture or such Debt
Security) payment of interest or principal (and premium, if any) need not be
made on such date at such Place of Payment, but may be made on the next
succeeding Business Day at such Place of Payment with the same force and effect
as if made on the Interest Payment Date or Redemption Date or at the Stated
Maturity, and no interest shall accrue for
13
<PAGE>
the period from and after such Interest Payment Date, Redemption Date or Stated
Maturity, as the case may be.
SECTION 114. Trust Indenture Act Controls.
----------------------------
If any provision of this Indenture limits, qualifies, or conflicts
with another provision which is required to be included in this Indenture by the
TIA, the required provision shall control.
ARTICLE TWO
DEBT SECURITY FORMS
SECTION 201. Form of Debt Securities.
-----------------------
The Debt Securities of each series shall be in substantially the form
(including any global form) as shall be established by or pursuant to a Board
Resolution or in one or more indentures supplemental hereto, in each case with
such appropriate insertions, omissions, substitutions and other variations as
are required or permitted by this Indenture (including such other provisions as
are necessary to reflect the global form of any Debt Security, and the
designation of a Depositary for such Global Debt Security), and may have such
letters, numbers or other marks of identification and such legends or
endorsements placed thereon as may be required to comply with the rules of any
securities exchange or other laws, rules or regulations or as may, consistently
herewith, be determined by the officers executing such Debt Securities, as
evidenced by their execution of the Debt Securities.
The definitive Debt Securities shall be printed, lithographed or
engraved or produced by any combination of these methods or may be produced in
any other manner, all as determined by the officers executing such Debt
Securities, as evidenced by their execution of such Debt Securities.
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<PAGE>
SECTION 202. Form of Trustee's Certificate of Authentication.
-----------------------------------------------
The Trustee's Certificate of Authentication on all Debt Securities
shall be in substantially the following form:
This is one of the Debt Securities of the series designated herein
referred to in the within-mentioned Indenture.
[Name of Trustee],
as Trustee
By _________________________
Authorized Signatory
SECTION 203. Form of Trustee's Certificate of Authentication by an
-----------------------------------------------------
Authenticating Agent.
--------------------
If at any time there shall be appointed an Authenticating Agent
pursuant to Section 612, the Trustee's Certificate of Authentication by such
Authenticating Agent on all Debt Securities shall be in substantially the
following form:
This is one of the Debt Securities of the series designated herein
referred to in the within-mentioned Indenture.
[Name of Trustee],
as Trustee
By [Name of Authenticating
Agent,]
Authenticating Agent
By ___________________________
Authorized Signer
15
<PAGE>
SECTION 204. Provisions in Global Debt Security.
----------------------------------
If Debt Securities of a series are issuable in whole or in part as
Global Debt Securities, as specified as contemplated by Section 301, then,
notwithstanding the provisions of Sections 301 and 302, any such Global Debt
Security shall represent such of the Outstanding Debt Securities of such series
as shall be specified therein and may provide that it shall represent the
aggregate principal amount of Outstanding Debt Securities from time to time
endorsed thereon and that the aggregate principal amount of Outstanding Debt
Securities represented thereby may from time to time be reduced to reflect
exchanges. The Global Debt Securities may be permanent or temporary. Any
endorsement of a Global Debt Security to reflect the amount, or any increase or
decrease in the principal amount, of Outstanding Debt Securities represented
thereby shall be made by the Trustee in such manner and upon instructions given
by such Person or Persons as shall be specified therein or in the Company Order
to be delivered to the Trustee pursuant to Section 303 or Section 304. Subject
to the provisions of Section 303 and, if applicable, Section 304, the Trustee
shall deliver and redeliver any permanent Global Debt Security in the manner and
upon instructions given by the Person or Persons specified therein or in the
applicable Company Order. If a Company Order pursuant to Section 303 or 304 has
been or simultaneously is delivered, any instructions by the Company with
respect to endorsement or delivery or redelivery of a Global Debt Security shall
be in writing but need not comply with Section 102 and need not be accompanied
by an Opinion of Counsel.
Notwithstanding the other provisions of this Indenture, unless
otherwise specified as contemplated by Section 301, payment of principal of (and
premium, if any) and interest, if any, on any permanent Global Debt Securities
shall be made to the Person or Persons specified therein.
Notwithstanding the provisions of Section 308 and except as provided
in the preceding paragraph, the Company, the Trustee and any agent of the
Company and the Trustee shall treat a Person as the Holder of such principal
amount of Outstanding Debt Securities represented by a Global Debt Security as
shall be specified in a written statement of the Depositary with respect to such
Global Debt Security, only for purposes of obtaining any consents or directions
required to be given by the Holders pursuant to this Indenture.
Unless otherwise provided as contemplated by Section 301 with respect
to any series of Debt Securities, any Global Debt Security shall provide, in
addition to the
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provisions established pursuant to Sections 201 and 301 and set forth in the
preceding paragraphs, that the Depositary will not sell, assign, transfer or
otherwise convey any beneficial interest in such Global Debt Security unless
such beneficial interest is in an amount equal to an authorized denomination for
Debt Securities of such series, and that the Depositary, by accepting such
Global Debt Security, agrees to be bound by such provision. Any Global Debt
Security shall also contain such other provisions as are necessary to reflect
the global form of such Debt Security and the designation of a Depositary for
such Global Debt Security.
ARTICLE THREE
THE DEBT SECURITIES
SECTION 301. Amount Unlimited; Issuable in Series.
------------------------------------
The aggregate principal amount of Debt Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Debt Securities may be issued in one or more series. There shall
be established in or pursuant to a Board Resolution, and set forth in or
determined in the manner described in an Officers' Certificate, or established
in one or more indentures supplemental hereto:
(1) the title of the Debt Securities and the series in which such Debt
Securities shall be included;
(2) any limit upon the aggregate principal amount of the Debt
Securities of that series which may be authenticated and delivered under
this Indenture (except for Debt Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other Debt
Securities of that series pursuant to Section 304, 305, 306, 905 or 1107)
and the percentage of their principal amount at which the Debt Securities
will be issued;
(3) the date or dates on which the principal of the Debt Securities of
that series is payable or the manner of determining the same;
(4) the rate or rates at which the Debt Securities of that series
shall bear interest, if any, or the manner of determining the same, the
date or dates from which such interest shall accrue, or the manner of
determining the same, the Interest Payment Dates on which such interest
shall be payable and the Regular
17
<PAGE>
Record Date for the determination of Holders to whom interest shall be
payable on any Interest Payment Date, and the basis upon which interest
shall be calculated if other than that of a year of twelve 30-day months;
(5) the place or places where the principal of (and premium, if any)
and interest, if any, on the Debt Securities of that series shall be
payable and the method of such payment;
(6) the period or periods within which, the price or prices at which
and the terms and conditions upon which the Debt Securities of that series
may be redeemed, in whole or in part, at the option of the Company;
(7) the obligation, if any, of the Company to redeem or purchase Debt
Securities of that series pursuant to any sinking fund or analogous
provisions or at the option of a Holder thereof and the period or periods
within which, the price or prices at which and the terms and conditions
upon which Debt Securities of that series shall be redeemed or purchased,
in whole or in part, pursuant to such obligation;
(8) if other than denominations of U.S. $100,000 and any integral
multiple of U.S. $1,000 above U.S. $100,000, the denominations in which the
Debt Securities of that series shall be issuable;
(9) if other than the principal amount thereof, the portion of the
principal amount of the Debt Securities of that series which shall be
payable upon declaration of acceleration of the Maturity thereof pursuant
to Section 502;
(10) the currency or currencies, including composite currencies or
units of two or more currencies, in which the payment of the principal of
(and premium, if any) and interest on the Debt Securities of that series
shall be payable (if other than currency of the United States of America);
(11) the provisions, if any, relating to the conversion or exchange of
the Debt Securities of any series into Debt Securities of another series or
into Common Stock;
(12) any additional covenants and events of default and the remedies
with respect thereto concerning the Debt Securities of that series if not
set forth herein;
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<PAGE>
(13) whether any Debt Securities of the series are to be issued in
whole or in part in the form of one or more Global Debt Securities and, if
so, the Depositary for such Global Debt Security or Debt Securities (which
Depositary shall be, if then required by applicable law or regulation, a
clearing agency registered under the Securities Exchange Act of 1934, as
amended, and any other applicable statute or regulation) and whether
beneficial owners of interests in such Global Debt Security or Debt
Securities may exchange such interests for Debt Securities of such series
and of like tenor and of any authorized form and denomination and the
circumstances under which any such exchanges may occur, if other than in
the manner provided in Section 305);
(14) the identity of the Trustee for the Debt Securities of the series
and if not the Trustee, the identity of each Paying Agent and Debt
Securities Registrar for the Debt Securities of the series; and
(15) any other terms of the Debt Securities of that series.
All Debt Securities of any one series shall be substantially identical
except as to denomination, currency, the rate or rates of interest, if any, and
the Maturity and except as may otherwise be provided in or pursuant to such
Board Resolution and set forth or determined in the manner described in such
Officers' Certificate, or in any such indenture supplemental hereto. All Debt
Securities of any one series need not be issued at the same time, and, unless
otherwise provided, a series may be reopened for issuances of additional Debt
Securities of that series.
Unless otherwise established in or pursuant to an Officers'
Certificate, or in one or more indentures supplemental hereto, at the option of
the Company, interest on the Debt Securities of any series that bears interest
may be paid by mailing a check to the address of the person entitled thereto as
such address shall appear in the Debt Securities Register.
If the form of Debt Securities of any series is established by action
taken pursuant to a Board Resolution, an appropriate Officers' Certificate
setting forth such form together with a copy of the Board Resolution shall be
delivered to the Trustee at or prior to the delivery of the order contemplated
by Section 303 for the authentication and delivery of such Debt Securities.
19
<PAGE>
SECTION 302. Denominations.
-------------
The Debt Securities of each series may be issued as Bearer Debt
Securities, as Registered Debt Securities or in any combination thereof, and in
such denominations and amounts, all as from time to time set forth in an
Officers' Certificate or supplemental indenture referred to in Section 301.
SECTION 303. Execution, Authentication, Delivery and Dating.
--------------------------------------- ------
The Debt Securities shall be executed on behalf of the Company by its
Chairman of the Board or its President or one of its Vice Presidents (whether or
not designated by a number or a word or words added before or after any such
title) under its corporate seal reproduced thereon and attested by its Secretary
or one of its Assistant Secretaries. The signature of any or all of these
officers on the Debt Securities may be manual or facsimile.
Debt Securities bearing the manual or facsimile signatures of
individuals who were at any time the proper officers of the Company shall bind
the Company, notwithstanding that such individuals or any of them have ceased to
hold such offices prior to the authentication and delivery of such Debt
Securities or did not hold such offices at the dates of such Debt Securities.
At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Debt Securities of any series executed
by the Company to the Trustee for authentication, together with the Officers'
Certificate or supplemental indenture with respect to such Debt Securities
referred to in Section 301 and a Company Order for the authentication and
delivery of such Debt Securities, and the Trustee, in accordance with Company
Order, but subject to the provisions hereof, shall authenticate and deliver such
Debt Securities. Such Company Order may provide that Debt Securities which are
the subject thereof will be authenticated and delivered by the Trustee upon the
order of Persons designated in said Company Order communicated to the Trustee in
writing or by telephone or other means set forth in such Company Order and that
such Persons are authorized to determine such terms and conditions of said Debt
Securities as are specified in the Company Order. In authenticating such Debt
Securities, and accepting the additional responsibilities under this Indenture
in relation to such Debt Securities, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating,
20
<PAGE>
(a) that the form and terms of such Debt Securities have been
established in conformity with the provisions of this Indenture; and
(b) that all conditions precedent to the authentication and delivery
of such Debt Securities have been complied with and that such Debt Securities,
when completed by appropriate insertions, authenticated and delivered by the
Trustee, issued by the Company and sold in the manner and subject to any
conditions specified in such Opinion of Counsel, will constitute valid and
binding obligations of the Company, enforceable against the Company in
accordance with their terms, except as may be limited by bankruptcy, insolvency,
reorganization, moratorium, conservatorship, receivership and similar laws
relating to or affecting creditors' rights generally (including, without
limitation, fraudulent conveyance laws) and by general principles of equity,
including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing and the possible unavailability of specific performance
or injunctive relief, regardless of whether considered in a proceeding in equity
or at law.
If all the Debt Securities of any series are not to be issued at one
time, it shall not be necessary to deliver an Opinion of Counsel at the time of
issuance of each Debt Security, but such opinion, with appropriate
modifications, shall be delivered at or before the time of issuance of the first
Debt Security of such series.
The Trustee shall not be required to authenticate such Debt Securities
if the issue of such Debt Securities pursuant to this Indenture will affect the
Trustee's own rights, duties or immunities under the Debt Securities and this
Indenture or otherwise in a manner which is not reasonably acceptable to the
Trustee or if the Trustee being advised by counsel determines that such action
may not lawfully be taken.
Each Debt Security shall be dated the date of its authentication.
No Debt Security shall be entitled to any benefit under this Indenture
or be valid or obligatory for any purpose, unless there appears on such Debt
Security a certificate of authentication substantially in the form provided for
herein executed by the Trustee by the manual signature of one of its authorized
signatories or authorized Authenticating Agents, and such certificate upon any
Debt Security shall be conclusive evidence, and the only evidence, that such
Debt Security has been duly authenticated and delivered hereunder.
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SECTION 304. Temporary Debt Securities.
-------------------------
Pending the preparation or distribution of definitive Debt Securities
of any series, the Company may execute and deliver to the Trustee, and upon
Company Order the Trustee shall authenticate and deliver in the manner provided
in Section 303, a temporary Debt Security or temporary Debt Securities of that
series which are printed, lithographed, typewritten, mimeographed or otherwise
produced, in any authorized denomination, substantially of the tenor of the
definitive Debt Securities in lieu of which they are issued or in such form as
may be prescribed in the Officers' Certificate or supplemental indenture
referred to in Section 301 with respect to such Debt Securities, and with such
appropriate insertions, omissions, substitutions and other variations as the
officers executing such Debt Securities may determine, as evidenced by the their
execution of such Debt Securities.
Except in the case of temporary Global Debt Securities, which shall be
exchanged in accordance with the provisions thereof, if temporary Debt
Securities are issued, the Company shall cause definitive Debt Securities to be
prepared without unreasonable delay. After the preparation of definitive Debt
Securities, the temporary Debt Security or temporary Debt Securities of that
series shall be exchanged for definitive Debt Securities of that series
containing identical terms and provisions upon surrender of the temporary Debt
Securities of that series, at an office or agency of the Company maintained for
such purpose pursuant to Section 1002, without charge to the Holder, or in such
other manner as set forth in the Officers' Certificate or supplemental indenture
referred to in Section 301 with respect to such Debt Securities. Upon surrender
for cancellation of any one or more temporary Debt Securities of any series, the
Company shall execute and the Trustee shall authenticate and deliver in exchange
therefor a like principal amount of definitive Debt Securities of authorized
denominations of the same series containing identical terms and provisions.
Except as set forth in the Officers' Certificate or supplemental indenture
referred to in Section 301 with respect to such Debt Securities, until so
exchanged, the temporary Debt Securities of any series shall in all respects be
entitled to the same benefits under this Indenture as definitive Debt Securities
of that series authorized and delivered hereunder.
SECTION 305. Registration, Registration of Transfer and Exchange.
---------------------------------------------------
The Company shall cause to be kept at the office of the Debt
Securities Registrar designated pursuant to this Section 305 or Section 1002 a
register (herein sometimes
22
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referred to as the "DEBT SECURITIES REGISTER") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of each series of Debt Securities and of transfers of each series
of Debt Securities. The Trustee is hereby initially appointed "DEBT SECURITIES
REGISTRAR" for the purpose of registering Debt Securities and transfers of Debt
Securities as herein provided.
Except as set forth in the Officers' Certificate or supplemental
indenture referred to in Section 301 with respect to any Debt Securities of a
series, upon surrender for registration of transfer of any Debt Security of any
series at any office or agency of the Company maintained for such purpose
pursuant to Section 1002, the Company shall execute, and the Trustee shall
authenticate and deliver, in the name of the designated transferee or
transferees, one or more new Debt Securities of authorized denominations of the
same series containing identical terms and provisions, of a like aggregate
principal amount.
Except as set forth in the Officers' Certificate or supplemental
indenture referred to in Section 301 with respect to any Debt Securities of a
series, at the option of the Holder, Debt Securities of any series may be
exchanged for other Debt Securities of authorized denominations of the same
series containing identical terms and provisions, of like aggregate principal
amount, upon surrender of the Debt Securities to be exchanged at such office or
agency. Whenever any Debt Securities are so surrendered for exchange, the
Company shall execute, and the Trustee shall authenticate and deliver, the Debt
Securities which the Holder making the exchange is entitled to receive.
All Debt Securities issued upon any registration of transfer or
exchange of Debt Securities shall be the valid obligations of the Company,
evidencing the same debt, and entitled to the same benefits under this
Indenture, as the Debt Securities surrendered upon such registration of transfer
or exchange.
Every Debt Security presented or surrendered for registration of
transfer or for exchange shall (if so required by the Company or the Debt
Securities Registrar for that series of Debt Security presented) be duly
endorsed, or be accompanied by a written instrument of transfer in form
satisfactory to the Company and the Debt Securities Registrar duly executed, by
the Holder thereof or his attorney duly authorized in writing.
No service charge shall be made for any registration of transfer or
exchange of Debt Securities, but the Company may require payment of a sum
sufficient to cover any
<PAGE>
tax or other governmental charge that may be imposed in connection with any
registration of transfer or exchange of Debt Securities, other than exchanges
pursuant to Section 304, 905 or 1107 not involving any transfer.
The Company shall not be required (a) to exchange Bearer Debt
Securities for Registered Debt Securities during the period between the close of
business on each Regular Record Date (or any Special Record Date) and the
opening of business on the next succeeding Interest Payment Date (or the related
date for payment of Defaulted Interest), or (b) in the event of redemption in
part, (i) to register the transfer of or exchange Registered Debt Securities or
to exchange Bearer Debt Securities for Registered Debt Securities for a period
of 15 days immediately preceding the date notice is given identifying the serial
numbers of the Debt Securities called for such redemption; (ii) to register the
transfer of or exchange any Registered Debt Securities, or portion thereof,
called for redemption except, in the case of any Registered Debt Securities to
be redeemed in part, the unredeemed portion of such Registered Debt Securities
being redeemed in part; or (iii) to exchange any such Bearer Debt Securities
called for redemption; provided, however, that in the case of both (a) and (b) a
-------- -------
Bearer Debt Security called for redemption may be exchanged for a Registered
Debt Security which is simultaneously surrendered, with written instructions for
payment on the Redemption Date. The Company also shall not be required to
exchange Bearer Debt Securities for Registered Debt Securities, if, as a result
thereof, the Company would incur adverse consequences under United States
federal income tax laws in effect at the time of such exchange.
If at any time the Depositary for the Debt Securities of a series
issued in the form of one or more Global Debt Securities notifies the Company
that it is unwilling or unable to continue as Depositary for the Debt Securities
of such series or if at any time the Depositary for the Debt Securities of such
series shall no longer be eligible under Section 301, the Company shall appoint
a successor Depositary with respect to the Debt Securities of such series. If a
successor Depositary for the Debt Securities of such series is not appointed by
the Company within ninety (90) days after the Company receives such notice or
becomes aware of such ineligibility, the Company's election to issue Global Debt
Securities pursuant to Section 301 shall no longer be effective with respect to
the Debt Securities of such series and the Company will execute, and the
Trustee, upon receipt of a Company Order for the authentication and delivery of
definitive Debt Securities of such series, will authenticate and deliver, Debt
Securities of such series in definitive form in an aggregate principal amount
equal to the principal amount of the Global Debt
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Security or Debt Securities representing such series in exchange for such Global
Debt Security or Debt Securities.
The Company may at any time and in its sole discretion determine that
the Debt Securities of any series issued in the form of one or more Global Debt
Securities shall no longer be represented by such Global Debt Security or Debt
Securities. In such event the Company will execute, and the Trustee, upon
receipt of a Company Order for the authentication and delivery of definitive
Debt Securities of such series, will authenticate and deliver, Debt Securities
of such series in definitive form, in authorized denominations, and in an
aggregate principal amount equal to the principal amount of the Global Debt
Security or Debt Securities representing such series in exchange for such Global
Debt Security or Debt Securities.
Unless and until a Global Debt Security is exchanged in whole or in
part for Debt Securities in definitive form in accordance with the provisions of
this Indenture, a Global Debt Security may not be transferred except as a whole
by the Depositary with respect to such Global Debt Security to a nominee of such
Depositary or by a nominee of such Depositary to such Depositary or another
nominee of such Depositary or by such Depositary or any such nominee to a
successor of such Depositary or a nominee of such successor. Unless otherwise
provided as contemplated by Section 301 with respect to any series of Debt
Securities evidenced in whole or in part by a Global Debt Security, the
Depositary may not sell, assign, transfer or otherwise convey any beneficial
interest in a Global Debt Security evidencing all or part of the Debt Securities
of such series unless such beneficial interest is in an amount equal to an
authorized denomination for Debt Securities of such series.
Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, any Global Debt Security shall be exchangeable only
as provided in this paragraph. If the beneficial owners of interests in a
Global Debt Security are entitled to exchange such interests for Debt Securities
of such series and of like tenor and principal amount of another authorized form
and denomination, as specified as contemplated by Section 301, then without
unnecessary delay but in any event not later than one Business Day prior to the
earliest date on which such interests may be so exchanged, the Company shall
deliver to the Trustee definitive Debt Securities of such series in aggregate
principal amount equal to the principal amount of such Global Debt Securities,
executed by the Company. On or after the earliest date on which such interests
may be so exchanged such Global Debt Securities shall be surrendered by the
Depositary as shall be specified in the Company Order with respect thereto to
the Trustee, as
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the Company's agent for such purpose, to be exchanged, in whole or from time to
time in part, for definitive Debt Securities of such series without charge and
the Trustee shall authenticate and deliver, in exchange for each portion of such
Global Debt Securities, a like aggregate principal amount of definitive Debt
Securities of the same series of authorized denominations and of like tenor as
the portion of such Global Debt Securities to be exchanged as shall be specified
by the Depositary; provided, however, that no such exchanges may occur for a
-------- -------
period of 15 days immediately preceding the date notice is given identifying the
serial numbers of the Debt Securities called for redemption; if a Registered
Debt Security of any series is issued in exchange for any portion of a Global
Debt Security after the close of business at the office or agency where such
exchange occurs on (1) any Regular Record Date and before the opening of
business at such office or agency on the relevant Interest Payment Date, or (2)
any Special Record Date and before the opening of business at such office or
agency on the related proposed date for payment of Defaulted Interest, interest
or Defaulted Interest, as the case may be, will not be payable on such Interest
Payment Date or proposed date for payment, as the case may be, in respect to
such Registered Debt Securities, but will be payable on such Interest Payment
Date or proposed date for payment, as the case may be, only to the Person to
whom interest in respect of such portion of such Global Debt Securities is
payable in accordance with the provisions of this Indenture.
SECTION 306. Mutilated, Destroyed, Lost and Stolen Debt Securities.
-----------------------------------------------------
If there is delivered to the Trustee any mutilated Debt Security and
such security or indemnity as may be required by the Trustee to save the Trustee
and the Company harmless, then the Company shall execute and the Trustee shall
authenticate and deliver in exchange therefor a new Debt Security of the same
series of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
If there be delivered to the Company and to the Trustee (i) evidence
to their satisfaction of the destruction, loss or theft of any Debt Security,
and (ii) such security or indemnity as may be required by them to save each of
them harmless, then, in the absence of notice to the Company or the Trustee that
such Debt Security has been acquired by a bona fide purchaser, the Company shall
execute and upon its request the Trustee shall authenticate and deliver, in lieu
of any such destroyed, lost or stolen Debt Security, a new Debt Security of the
same series of like tenor and principal amount and bearing a number not
contemporaneously outstanding.
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In case any such mutilated, destroyed, lost or stolen Debt Security
has become or is about to become due and payable, the Company in its discretion
may, instead of issuing a new Debt Security, pay such Debt Security.
Upon the issuance of any new Debt Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
Every new Debt Security of any series issued pursuant to this Section
in lieu of any destroyed, lost or stolen Debt Security shall constitute an
original additional contractual obligation of the Company, whether or not the
destroyed, lost or stolen Debt Security shall be at any time enforceable by
anyone, and shall be entitled to all the benefits of this Indenture equally and
proportionately with any and all other Debt Securities of that series duly
issued hereunder.
The provisions of this Section are exclusive and shall preclude (to
the extent lawful) all other rights and remedies with respect to the replacement
or payment of mutilated, destroyed, lost or stolen Debt Securities.
SECTION 307. Payment of Interest; Interest Rights Preserved.
----------------------------------------------
Interest on any Registered Debt Security which is payable, and is
punctually paid or duly provided for, on any Interest Payment Date shall, if so
provided in such Registered Debt Security, be paid to the Person in whose name
such Registered Debt Security (or one or more Predecessor Debt Securities) is
registered at the close of business on the Regular Record Date for such
interest, unless interest is payable at Maturity, in which case interest shall
be paid to the Person entitled to receive payment of the principal of such
Registered Debt Security at Maturity.
Any interest on any Registered Debt Security of any series which is
payable, but is not punctually paid or duly provided for, on any Interest
Payment Date for such Registered Debt Security (herein called "DEFAULTED
INTEREST") shall forthwith cease to be payable to the Holder on the relevant
Regular Record Date by virtue of having been such Holder; and such Defaulted
Interest may be paid by the Company, at its election in each case as provided in
Clause (1) or (2) below:
(1) The Company may elect to make payment of any Defaulted Interest to
the Persons in whose names the
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Registered Debt Securities affected (or their respective Predecessor Debt
Securities) are registered at the close of business on a Special Record
Date for the payment of such Defaulted Interest, which shall be fixed in
the following manner. The Company shall notify the Trustee in writing of
the amount of Defaulted Interest proposed to be paid on each such
Registered Debt Security and the date of the proposed payment, and at the
same time the Company shall deposit with the Trustee an amount of money
equal to the aggregate amount proposed to be paid in respect of such
Defaulted Interest or shall make arrangements satisfactory to the Trustee
for such deposit prior to the date of the proposed payment, such money when
deposited to be held in trust for the benefit of the Persons entitled to
such Defaulted Interest as in this Clause (1) provided. Thereupon the
Trustee shall fix a Special Record Date for the payment of such Defaulted
Interest which shall be not more than 15 days and not less than 10 days
prior to the date of the proposed payment and not less than 10 days after
the receipt by the Trustee of the notice of the proposed payment. The
Trustee shall promptly notify the Company of such Special Record Date and,
in the name and at the expense of the Company, shall cause notice of the
proposed payment of such Defaulted Interest and the Special Record Date
therefor to be mailed, first-class postage prepaid, to each Holder of such
Registered Debt Securities at his address as it appears in the Debt
Securities Register not less than 10 days prior to such Special Record
Date. Notice of the proposed payment of such Defaulted Interest and the
Special Record Date therefor having been mailed as aforesaid, such
Defaulted Interest shall be paid to the Persons in whose names such
Registered Debt Securities (or their respective Predecessor Debt
Securities) are registered at the close of business on such Special Record
Date and shall no longer be payable pursuant to the following Clause (2).
(2) The Company may make payment of any Defaulted Interest in any
other lawful manner not inconsistent with the requirements of any
securities exchange on which the Registered Debt Securities affected may be
listed, and upon such notice as may be required by such exchange, if, after
notice given by the Company to the Trustee of the proposed payment pursuant
to this Clause (2), such payment shall be deemed practicable by the
Trustee.
Subject to the foregoing provisions of this Section, each Debt
Security delivered under this Indenture upon registration of transfer of or in
exchange for or in lieu of any other Debt Security shall carry the rights to
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<PAGE>
interest accrued and unpaid, and to accrue, which were carried by such other
Debt Security.
SECTION 308. Persons Deemed Owners.
---------------------
The Company, the Trustee and any agent of the Company or the Trustee
may treat the bearer of any Bearer Debt Security as the owner of such Debt
Security for the purpose of receiving payment of principal of (and premium, if
any) and any interest, if any, on such Bearer Debt Security and for all other
purposes whatsoever, whether or not such Debt Security is overdue, and neither
the Company, the Trustee nor any agent of the Company or the Trustee shall be
affected by notice to the contrary. Prior to due presentment of a Debt Security
for registration of transfer, the Company, the Trustee and any agent of the
Company or the Trustee may treat the Person in whose name such Debt Security is
registered as the owner of such Debt Security for the purpose of receiving
payment of principal of (and premium, if any) and (subject to Section 307)
interest, if any, on such Debt Security and for all other purposes whatsoever,
whether or not such Debt Security be overdue, and neither the Company, the
Trustee nor any agent of the Company or the Trustee shall be affected by notice
to the contrary.
Notwithstanding the foregoing, with respect to any Global Debt
Security, nothing herein shall prevent the Company, the Trustee, or any agent of
the Company or the Trustee, from giving effect to any written certification,
proxy or other authorization furnished by a Depositary or impair, as between a
Depositary and holders of beneficial interests in any Global Debt Security, the
operation of customary practices governing the exercise of the rights of the
Depositary as Holder of such Global Debt Security.
SECTION 309. Cancellation.
------------
All Debt Securities surrendered for payment, redemption, registration
of transfer or exchange shall, if surrendered to any Person other than the
Trustee, be delivered to the Trustee, and any such Debt Securities and Debt
Securities surrendered directly to the Trustee for any such purpose shall (i) in
the case of Bearer Debt Securities, be retained in the possession of the Trustee
for the purpose of reissuance upon subsequent exchanges, and the Trustee, prior
to reissuance of any such Bearer Debt Security, shall detach therefrom and
cancel all matured coupons, or, at the discretion of the Trustee, be cancelled
promptly by the Trustee, and (ii) in the case of Registered Debt Securities, be
cancelled promptly by the Trustee. The Company may at any time deliver to the
Trustee for cancellation any Debt Securities previously authenticated and
29
<PAGE>
delivered hereunder which the Company may have acquired in any manner
whatsoever, and all Debt Securities so delivered shall be promptly cancelled by
the Trustee unless otherwise instructed by the Company. No Debt Securities
shall be authenticated in lieu of or in exchange for any Debt Securities
cancelled as provided in this Section, except as expressly permitted by this
Indenture. Upon written instructions of the Company, all cancelled Debt
Securities shall be returned to the Company upon the written request of the
Company.
SECTION 310. Computation of Interest.
-----------------------
Except as otherwise specified as contemplated by Section 301 for Debt
Securities of any series, interest on the Debt Securities of each series shall
be computed on the basis of a year of twelve 30-day months.
ARTICLE FOUR
SATISFACTION AND DISCHARGE
SECTION 401. Satisfaction and Discharge of Indenture.
---------------------------------------
This Indenture shall cease to be of further effect (except as
otherwise specifically provided herein and to any surviving rights of
registration of transfer, conversion or exchange of Debt Securities herein
expressly provided for), and the Trustee, on demand of and at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of this Indenture, when
(1) either
(A) all Debt Securities theretofore authenticated and delivered (other
than (i) coupons appertaining to Bearer Debt Securities surrendered for
exchange for Registered Debt Securities and maturing after such exchange,
whose surrender has been waived, (ii) Debt Securities which have been
destroyed, lost or stolen and which have been replaced or paid as provided
in Section 306, (iii) coupons appertaining to Bearer Debt Securities called
for redemption and maturing after the relevant Redemption Date, whose
surrender has been waived, and (iv) Debt Securities for whose payment money
has theretofore been deposited in trust or segregated and held in trust by
the Company and thereafter repaid to the Company or discharged from such
trust, as provided in Section 1003), have been delivered to the Trustee for
cancellation; or
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(B) all such Debt Securities not theretofore delivered to the Trustee
for cancellation
(i) have become due and payable, or
(ii) will become due and payable at their Stated Maturity within
one year, or
(iii) if redeemable at the option of the Company, are to be called
for redemption within one year under arrangements satisfactory to the
Trustee for the giving of notice of redemption by the Trustee in the
name, and at the expense, of the Company,
and the Company, in the case of (i), (ii) or (iii) of paragraph (B) above, has
deposited or caused to be deposited with the Trustee as trust funds in trust for
the purpose an amount sufficient to pay and discharge the entire indebtedness on
such Debt Securities not theretofore delivered to the Trustee for cancellation,
for principal (and premium, if any) and interest, if any, to the date of such
deposit (in the case of Debt Securities which have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be:
(2) the Company has paid or caused to be paid all other sums payable
hereunder by the Company; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent herein
provided for relating to the satisfaction and discharge of this Indenture have
been complied with.
Notwithstanding the satisfaction and discharge of this Indenture, the
obligations of the Company to the Trustee under Sections 607 and 612 and the
obligations of the Trustee to any Authenticating Agent under Section 612 and, if
money shall have been deposited with the Trustee pursuant to paragraph (B) of
this Section, the rights, powers, protections, trusts, duties and indemnities of
the Trustee hereunder, the Company's obligations with respect to such Debt
Securities under Sections 304, 305, 306, 1002, 1003 and 1006, the obligations of
the Trustee under Section 402 and the last paragraph of Section 1003, shall
survive.
SECTION 402. Application of Trust Money.
--------------------------
Subject to the provisions of the last paragraph of Section 1003, all
money deposited with the Trustee pursuant to Section 401 shall be held in trust
and applied by it, in accordance with the provisions of the Debt Securities and
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this Indenture, to the payment, either directly or through any Paying Agent
(including the Company acting as its own Paying Agent) as the Trustee may
determine, to the Persons entitled thereto, of the principal (and premium, if
any) and interest, if any, for whose payment such money has been deposited with
the Trustee.
ARTICLE FIVE
REMEDIES
SECTION 501. Events of Default.
-----------------
"EVENT OF DEFAULT" wherever used herein with respect to Debt
Securities of any series, means any one of the following events (whatever the
reason for such Event of Default and whether it shall be voluntary or
involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule, or regulation of any
administrative or governmental body):
(1) default in the payment of any interest upon any Debt Security of
that series when it becomes due and payable, and continuance of such
default for a period of 30 days; or
(2) default in the payment of the principal of (and premium, if any)
on any Debt Security of that series when it becomes due and payable at its
Maturity; or
(3) default in the deposit of any sinking fund payment when the same
shall become due and payable by the terms of any Debt Security of that
series; or
(4) default in the performance, or breach, of any covenant or warranty
of the Company in this Indenture (other than a covenant or warranty a
default in whose performance or whose breach is elsewhere in this Section
specifically dealt with or which has been expressly included in this
Indenture solely for the benefit of a series of Debt Securities other than
that series), and continuance of such default or breach for a period of 60
days after there has been given, by registered or certified mail, to the
Company by the Trustee or to the Company and the Trustee by the Holders of
at least 10% in principal amount of the Outstanding Debt Securities of that
series a written notice specifying such default or breach and requiring it
to be remedied and stating that such notice is a "NOTICE OF DEFAULT"
hereunder; or
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(5) a receiver, liquidator, assignee, custodian, trustee, conservator,
sequestrator or other similar official shall take possession of the Company
or any substantial part of its property without its consent, or the entry
of a decree or order for relief by a court having jurisdiction in the
premises in respect of the Company in an involuntary case under the Federal
Bankruptcy Code or any other applicable Federal or State law, or appointing
a receiver, liquidator, custodian, assignee, trustee, sequestrator,
conservator, or other similar official of the Company or of any substantial
part of its property, or ordering the winding up or liquidation of its
affairs, and the continuance of any such possession, decree or order
unstayed and in effect for a period of 60 consecutive days; or
(6) the commencement by the Company of a voluntary case under the
Federal Bankruptcy Code or any other applicable Federal or State law, or
the consent by either of the foregoing to the entry of an order for relief
in an involuntary case under any such law, or the consent by the Company to
the appointment of or taking possession by a receiver, liquidator,
assignee, custodian, trustee, conservator, sequestrator or other similar
official of the Company or of any substantial part of its property, or the
making by the Company of an assignment for the benefit of creditors; or
(7) a default under any mortgage, indenture or instrument under which
there may be issued or by which there may be secured or evidenced any
indebtedness for money borrowed by the Company (including this Indenture),
whether such indebtedness now exists or shall hereafter be created, which
default shall constitute a failure to pay principal of such indebtedness in
an amount exceeding $10,000,000 when due and payable (other than as a
result of acceleration), after expiration of any applicable grace period
with respect thereto, or shall have resulted in such indebtedness, in an
aggregate principal amount exceeding $10,000,000, becoming or being
declared due and payable prior to the date on which it would otherwise have
become due and payable, without such indebtedness having been discharged or
such acceleration having been rescinded or annulled within a period of 10
days after there shall have been given, by registered or certified mail, to
the Company by the Trustee or to the Company and the Trustee by the Holders
of at least 25% in principal amount of the Outstanding Debt Securities of
that series, a written notice specifying such default and requiring the
Company to cause such indebtedness to be discharged or such acceleration to
be rescinded or
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annulled and stating that such notice is a "Notice of Default" hereunder;
provided, however, that any such event of default shall not be deemed to
-------- -------
have occurred so long as the Company shall contest the validity thereof in
good faith by appropriate proceedings (notwithstanding the foregoing, the
Trustee shall be obligated to provide the notice specified in Section 602);
or
(8) any other event of default provided with respect to Debt
Securities of that series.
SECTION 502. Acceleration of Maturity; Rescission and Annulment.
--------------------------------------------------
If an Event of Default occurs with respect to Debt Securities of any
series and is continuing, then and in every such case the Trustee (upon
obtaining knowledge of such Event of Default) or the Holders of not less than
25% in principal amount of the Outstanding Debt Securities of that series may
declare the principal of all the Debt Securities of that series, or if the Debt
Securities of that series are Original Issue Discount Debt Securities, such
portion of the principal amount as may be specified in the terms of that series,
to be due and payable immediately, by a notice in writing to the Company (and to
the Trustee if given by Holders), and upon any such declaration such principal
shall become immediately due and payable.
At any time after such a declaration of acceleration with respect to
Debt Securities of any series has been made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter in this
Article provided, the Holders of a majority in principal amount of the
Outstanding Debt Securities of that series, by written notice to the Company and
the Trustee, may rescind and annul such declaration and its consequences if
(1) the Company has paid or deposited with the
Trustee a sum sufficient to pay
(A) all overdue installments of interest, if any, on all Debt
Securities of that series,
(B) the principal of (and premium, if any, on) any Debt
Securities of that series which have become due otherwise than by such
declaration of acceleration and interest thereon at the rate or rates
borne by or provided for in such Debt Securities,
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(C) to the extent that payment of such interest is lawful,
interest upon overdue installments of interest at the rate or rates
borne by or provided for in such Debt Securities, and
(D) all sums paid or advanced by the Trustee hereunder and the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel; and
(2) all Events of Default with respect to Debt Securities of that
series, other than the non-payment of the principal of Debt Securities of
that series which has become due solely by such acceleration, have been
cured or waived as provided in Section 513.
No such rescission shall affect any subsequent default or impair any right
consequent thereon.
Upon receipt by the Trustee of any declaration of acceleration given
by a Holder of a Debt Security or by a Person who is the beneficial owner of an
interest in a Global Debt Security (as conclusively established by the
Depositary's records or rescission and annulment thereof, with respect to Debt),
Securities of a series all or part of which is represented by a Global Debt
Security, the Trustee shall establish a record date for determining Holders of
Outstanding Debt Securities of such series entitled to join in such declaration
of acceleration, or rescission and annulment, as the case may be, which record
date shall be at the close of business on the day the Trustee receives such
declaration of acceleration, or rescission and annulment, as the case may be.
The Holders on such record date, or their duly designated proxies, and only such
Persons, shall be entitled to join in such declaration of acceleration, or
rescission and annulment, as the case may be, whether or not such Holders remain
Holders after such record date; provided, that unless such declaration of
--------
acceleration, or rescission and annulment, as the case may be, shall have become
effective by virtue of the requisite percentage having been obtained prior to
the day which is ninety (90) days after such record date, such declaration of
acceleration, or rescission and annulment, as the case may be, shall
automatically without further action by any Holder be cancelled and of no
further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of
a Holder, from giving, after expiration of such ninety (90) day period, a new
declaration of acceleration, or rescission or annulment thereof, as the case may
be, that is identical to a declaration of acceleration, or rescission or
annulment thereof, which has been cancelled pursuant to the proviso to the
preceding sentence, in which event a new record date
35
<PAGE>
shall be established pursuant to the provisions of this Section 502.
SECTION 503. Collection of Indebtedness and Suits for Enforcement by
-------------------------------------------------------
Trustee.
-------
The Company covenants that if
(1) default is made in the payment of any installment of interest on
any Debt Security when such interest becomes due and payable and such
default continues for a period of 30 days, or
(2) default is made in the payment of the principal of (or premium, if
any, on) any Debt Security at the Maturity thereof or in the deposit of any
sinking fund payment, if any, when the same shall have become payable,
the Company will, upon demand of the Trustee, pay to it, for the benefit of the
Holders of such Debt Securities, the whole amount then due and payable on such
Debt Securities for principal (and premium, if any) and interest, if any, with
interest upon the overdue principal (and premium, if any) and, to the extent
that payment of such interest is lawful, upon overdue installments of interest,
at the rate or rates borne by or provided for in such Debt Securities, and, in
addition thereto, such further amount as shall be sufficient to cover the costs
and expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
If the Company fails to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust, may institute a
judicial proceeding for the collection of the sums so due and unpaid, and may
prosecute such proceeding to judgment or final decree, and may enforce the same
against the Company or any other obligor upon the Debt Securities and collect
the moneys adjudged or decreed to be payable in the manner provided by law out
of the property of the Company or any other obligor upon the Debt Securities
wherever situated.
If an Event of Default with respect to the Debt Securities of any
series occurs and is continuing, the Trustee may in its discretion proceed to
protect and enforce its rights and the rights of the Holders of Debt Securities
of that series by such appropriate judicial proceedings as the Trustee shall
deem most effectual to protect and enforce any such rights, whether for the
specific enforcement of any covenant or agreement in this Indenture or in aid of
the exercise of any power granted herein, or to enforce any other proper remedy.
36
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SECTION 504. Trustee May File Proofs of Claim.
--------------------------------
In case of the pendency of any receivership, conservatorship,
insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment,
composition or other judicial or other proceeding relative to the Company or any
other obligor upon the Debt Securities or the property of the Company or of such
other obligor or their creditors, the Trustee (irrespective of whether the
principal of the Debt Securities shall then be due and payable as therein
expressed or by declaration or otherwise and irrespective of whether the Trustee
shall have made any demand on the Company for the payment of overdue principal
or interest) shall be entitled and empowered, by intervention in such proceeding
or otherwise,
(1) to file and prove a claim for the whole amount of principal (and
premium, if any) and interest, if any, owing and unpaid in respect of the
Debt Securities and to file such other papers or documents as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and of
the Holders allowed in such judicial proceeding, and
(2) to collect and receive any moneys or other property payable or
deliverable on any such claims and to distribute the same;
and any receiver, liquidator, assignee, custodian, trustee, conservator,
sequestrator or other similar official in any such judicial or other proceeding
is hereby authorized by each Holder to make such payments to the Trustee and, in
the event that the Trustee shall consent to the making of such payments directly
to the Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 607.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Debt
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Holder in any such proceeding.
37
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SECTION 505. Trustee May Enforce Claims Without Possession of Debt
-----------------------------------------------------
Securities.
----------
All rights of action and claims under this Indenture or any of the
Debt Securities may be prosecuted and enforced by the Trustee without the
possession of any of the Debt Securities or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust, and any
recovery of judgment shall, after provision for the payment of the reasonable
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, be for the ratable benefit of the Holders of the Debt Securities in
respect of which such judgment has been recovered.
SECTION 506. Application of Money Collected.
------------------------------
Any money collected by the Trustee pursuant to this Article shall be
applied in the following order, at the date or dates fixed by the Trustee and,
in case of the distribution of such money on account of principal (or premium,
if any) or interest, if any, upon presentation of the Debt Securities and the
notation thereon of the payment if only partially paid and upon surrender
thereof if fully paid:
FIRST: To the payment of all amounts due the Trustee under Section
607;
SECOND: To the payment of the amounts then due and unpaid upon the
Debt Securities for principal (and premium, if any) and interest, if any,
in respect of which or for the benefit of which such money has been
collected, ratably, without preference or priority of any kind, according
to the amounts due and payable on such Debt Securities for principal (and
premium, if any) and interest, if any, respectively; and
THIRD: The balance, if any, to the Company or any other Person or
Persons entitled thereto.
SECTION 507. Limitation on Suits.
-------------------
No Holder of any Debt Security of any series shall have any right to
institute any proceeding, judicial or otherwise, with respect to this Indenture,
or for the appointment of a receiver or trustee, or for any other remedy
hereunder, unless
(1) such Holder has previously given written notice to the Trustee of
a continuing Event of Default with respect to the Debt Securities of that
series;
38
<PAGE>
(2) the Holders of not less than 25% in principal amount of the
Outstanding Debt Securities of that series have made written request to the
Trustee to institute proceedings in respect of such Event of Default in its
own name as Trustee hereunder;
(3) such Holder or Holders have offered to the Trustee reasonable
indemnity against the costs, expenses and liabilities to be incurred in
compliance with such request;
(4) the Trustee for 60 days after its receipt of such notice, request
and offer of indemnity has failed to institute any such proceeding; and
(5) no direction inconsistent with such written request has been given
to the Trustee during such 60 day period by the Holders of a majority in
principal amount of the Outstanding Debt Securities of that series;
it being understood and intended that no one or more Holders of Debt Securities
of any series shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this Indenture to affect, disturb or prejudice the
rights of any other Holders of Debt Securities of that series or of any other
series, or to obtain or to seek to obtain priority or preference over any other
Holders or to enforce any right under this Indenture, except in the manner
herein provided and for the equal and ratable benefit of all the Holders of Debt
Securities of that series.
SECTION 508. Unconditional Right of Holders to Receive Principal, Premium
------------------------------------------------------------
and Interest.
------------
Notwithstanding any other provision in this Indenture, the Holder of
any Debt Security shall have the right, which is absolute and unconditional, to
receive payment of the principal of (and premium, if any) and (subject to
Section 307) interest (including any additional interest provided for in an
Officers' Certificate or supplemental indenture referred to in Section 301 with
respect to any Debt Securities of a series), if any, on such Debt Security on
the respective Stated Maturities expressed in such Debt Security (or, in the
case of redemption, on the Redemption Date) and to institute suit for the
enforcement of any such payment, and such right shall not be impaired without
the consent of such Holder.
SECTION 509. Restoration of Rights and Remedies.
----------------------------------
If the Trustee or any Holder has instituted any proceeding to enforce
any right or remedy under this
39
<PAGE>
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then, subject
to any determination in such proceeding, and in every such case the Company, the
Trustee and the Holders shall be restored severally and respectively to their
former positions hereunder, and thereafter all rights and remedies of the
Trustee and the Holders shall continue as though no such proceeding had been
instituted.
SECTION 510. Rights and Remedies Cumulative.
------------------------------
No right or remedy herein conferred upon or reserved to the Trustee or
to the Holders is intended to be exclusive of any other right or remedy, and
every right and remedy shall, to the extent permitted by law, be cumulative and
in addition to every other right and remedy given hereunder or now or hereafter
existing at law or in equity or otherwise. The assertion or employment of any
right or remedy hereunder, or otherwise, shall not prevent the concurrent
assertion or employment of any other appropriate right or remedy.
SECTION 511. Delay or Omission Not Waiver.
----------------------------
To the extent permitted by law, no delay or omission of the Trustee or
of any Holder of any Debt Security to exercise any right or remedy accruing upon
any Event of Default shall impair any such right or remedy or constitute a
waiver of any such Event of Default or an acquiescence therein. Every right and
remedy given by this Article or by law to the Trustee or to the Holders may be
exercised from time to time, and as often as may be deemed expedient, by the
Trustee or by the Holders, as the case may be.
SECTION 512. Control by Holders.
------------------
Subject to Section 503, the Holders of a majority in principal amount
of the Outstanding Debt Securities of any series shall have the right to direct
the time, method and place of conducting any proceeding for any remedy available
to the Trustee or exercising any trust or power conferred on the Trustee with
respect to Debt Securities of that series, provided that
--------
(1) such direction shall not be in conflict with any rule of law or
with this Indenture,
(2) the Trustee shall not determine that the action so directed would
be unjustly prejudicial to Holders of Debt Securities of that series, or
any other series not taking part in such direction, and
40
<PAGE>
(3) the Trustee may take any other action deemed proper by the Trustee
which is not inconsistent with such direction.
Upon receipt by the Trustee of any purported direction with respect to
Debt Securities of a series all or part of which is represented by a Global Debt
Security, the Trustee shall establish a record date for determining Holders of
Outstanding Debt Securities of such series entitled to join in such direction,
which record date shall be at the close of business on the day the Trustee
receives such direction. The Holders on such record date, or their duly
designated proxies, and only such Persons, shall be entitled to join in such
direction, whether or not such Holders remain Holders after such record date;
provided, that unless such majority in principal amount shall have been obtained
- --------
prior to the day which is ninety (90) days after such record date, such
direction shall automatically and without further action by any Holder be
cancelled and of no further effect. Nothing in this paragraph shall prevent a
Holder, or a proxy of a Holder, from giving, after expiration of such ninety
(90) day period, a new direction identical to a direction which has been
cancelled pursuant to the proviso to the preceding sentence, in which event a
new record date shall be established pursuant to the provisions of this Section
512.
SECTION 513. Waiver of Past Defaults.
-----------------------
The Holders of not less than a majority in principal amount of the
Outstanding Debt Securities of any series may on behalf of the Holders of all
the Debt Securities of that series waive any past default hereunder with respect
to that series and its consequences, except a default
(1) in the payment of the principal of (or premium, if any) or
interest, if any, on any Debt Security of that series, or
(2) in respect of a covenant or provision hereof which under Article
Nine cannot be modified or amended without the consent of the Holder of
each Outstanding Debt Security of that series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default arising therefrom shall be deemed to have been cured, for every
purpose of this Indenture; but no such waiver shall extend to any subsequent or
other default or impair any right consequent thereon.
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<PAGE>
SECTION 514. Undertaking for Costs.
---------------------
All parties to this Indenture agree, and each Holder of any Debt
Security by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for any
action taken, suffered or omitted by it as Trustee, the filing by any party
litigant in such suit, other than the Trustee, of an undertaking to pay the
costs of such suit, and that such court may in its discretion assess reasonable
costs, including reasonable attorneys' fees, against any party litigant in such
suit, including the Trustee, having due regard to the merits and good faith of
the claims or defenses made by such party litigant; but the provisions of this
Section shall not apply to any suit instituted by the Trustee, or any suit
instituted by any Holder, or group of Holders, holding in the aggregate more
than 10% in principal amount of the Outstanding Debt Securities of any series,
or to any suit instituted by any Holder for the enforcement of the payment of
the principal of (or premium, if any) or interest, if any, on any Debt Security
on or after the Stated Maturity expressed in such Debt Security (or, in the case
of redemption, on or after the Redemption Date).
SECTION 515. Waiver of Stay or Extension Laws.
--------------------------------
The Company covenants (to the extent that it may lawfully do so) that
it will not at any time insist upon, or plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay or extension law wherever enacted,
or at any time hereafter in force, which may affect the covenants or the
performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such law
and covenants that it will not hinder, delay or impede the exercise of any power
herein granted to the Trustee, but will suffer and permit the exercise of every
such power as though no such law had been enacted.
ARTICLE SIX
THE TRUSTEE
SECTION 601. Certain Duties and Responsibilities.
-----------------------------------
(a) Except during the continuance of an Event of
Default,
(1) the Trustee undertakes to perform such duties and only such duties
as are specifically set forth in
42
<PAGE>
this Indenture, and, to the extent lawful, no implied covenants or
obligations shall be read into this Indenture against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, upon certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture; but in
the case of any such certificates or opinions which by any provision hereof
are specifically required to be furnished to the Trustee, the Trustee shall
be under a duty to examine the same to determine whether or not they
conform to the requirements of this Indenture.
(b) In case an Event of Default has occurred and is continuing, the
Trustee shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in their exercise, as a
prudent man would exercise or use under the circumstances in the conduct of his
own affairs.
(c) No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act, or its own willful misconduct, except that
------
(1) this Subsection shall not be construed to
limit the effect of Subsection (a) of this Section;
(2) the Trustee shall not be liable for any error
of judgment made in good faith by a Responsible Officer, unless it shall be
proved that the Trustee was negligent in ascertaining the pertinent facts;
(3) the Trustee shall not be liable with respect to any action taken
or omitted to be taken by it in good faith in accordance with the direction
of the Holders of a majority in principal amount of the Outstanding Debt
Securities of any series relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture with respect to the Debt Securities of that series; and
(4) no provision of this Indenture shall require the Trustee to expend
or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder, or in the exercise of any of
its rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or
43
<PAGE>
adequate indemnity against such risk or liability is not reasonably assured
to it.
(d) Whether or not therein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Section.
SECTION 602. Notice of Defaults.
------------------
Within 90 days after the occurrence of any default hereunder known to
a Responsible Officer of the Trustee with respect to the Debt Securities of any
series, the Trustee shall transmit in the manner specified under Section 106 to
all Holders of Debt Securities of that series (including Holders identified in
TIA (S) 315(b)), notice of such default hereunder known to the Trustee, unless
such default shall have been cured or waived; provided, however, that, except in
-------- -------
the case of a default in the payment of the principal of (or premium, if any) or
interest, if any, on any Debt Security of that series, or in the payment of any
sinking fund payment with respect to Debt Securities of that series, the Trustee
shall be protected in withholding such notice if and so long as the board of
directors, the executive committee or a trust committee of directors or
Responsible Officers of the Trustee in good faith determine that the withholding
of such notice is in the interests of the Holders of Debt Securities of that
series; and provided further, that in the case of any default of the character
-------- -------
specified in Section 501(4) with respect to Debt Securities of that series, no
such notice to Holders shall be given until at least 60 days after the
occurrence thereof. For the purpose of this Section, the term "DEFAULT" means
any event which is, or after notice or lapse of time or both would become, an
Event of Default with respect to Debt Securities of that series.
SECTION 603. Certain Rights of Trustee.
-------------------------
Subject to the provisions of Section 601,
(a) the Trustee may rely and shall be protected in acting or
refraining from acting upon any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, debenture,
Debt Security or other paper or document believed by it in good faith to be
genuine and to have been signed or presented by the proper party or parties;
(b) any request or direction of the Company mentioned herein shall be
sufficiently evidenced by a Company Request or Company Order and any resolution
of the
44
<PAGE>
Board of Directors may be sufficiently evidenced by a Board Resolution;
(c) whenever in the administration of this Indenture the Trustee shall
deem it desirable that a matter be proved or established prior to taking,
suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part,
rely upon an Officers' Certificate;
(d) the Trustee may consult with counsel and the written advice of
such counsel or any Opinion of Counsel shall be full and complete authorization
and protection in respect of any action taken, suffered or omitted by it
hereunder in good faith and in reliance thereon;
(e) the Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders pursuant to this Indenture, unless such Holders shall have
offered to the Trustee reasonable security or indemnity against the costs,
expenses and liabilities which might be incurred by it in compliance with such
request or direction;
(f) the Trustee shall not be bound to make any investigation into the
facts or matters stated in any resolution, certificate, statement, instrument,
opinion, report, notice, request, direction, consent, order, bond, Debt Security
or other paper or document, but the Trustee, in its discretion, may make such
further inquiry or investigation into such facts or matters as it may see fit,
and, if the Trustee shall determine to make such further inquiry or
investigation, it shall be entitled to examine the books, records and premises
of the Company, personally or by agent or attorney;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder; and
(h) the Trustee shall not be liable for any action taken by it in good
faith and believed by it to be authorized or within the discretion or rights or
powers conferred upon it by this Indenture.
45
<PAGE>
SECTION 604. Not Responsible for Recitals or Issuance of Debt Securities.
-----------------------------------------------------------
The recitals contained herein and in the Debt Securities, except the
Trustee's certificates of authentication, shall be taken as the statements of
the Company, and the Trustee assumes no responsibility for their correctness.
The Trustee makes no representations as to the validity or sufficiency of this
Indenture or of the Debt Securities. The Trustee shall not be accountable for
the use or application by the Company of the Debt Securities or the proceeds
thereof.
SECTION 605. May Hold Debt Securities.
------------------------
The Trustee, any Paying Agent, the Debt Securities Registrar or any
other agent of the Company or the Trustee, in its individual or any other
capacity, may become the owner or pledgee of Debt Securities and may otherwise
deal with the Company with the same rights it would have if it were not Trustee,
Paying Agent, Debt Securities Registrar or such other agent.
SECTION 606. Money Held in Trust.
-------------------
Money held by the Trustee in trust hereunder need not be segregated
from other funds except to the extent required by law. Such amounts shall be
invested by the Trustee solely at the written direction of the Company. The
Trustee shall be under no liability for interest on any money received by it
hereunder except as otherwise agreed with the Company.
SECTION 607. Compensation, Reimbursement and Indemnity.
-----------------------------------------
The Company agrees
(1) to pay to the Trustee from time to time reasonable compensation
for all services rendered by it hereunder (which compensation shall not be
limited by any provision of law in regard to the compensation of a trustee
of an express trust);
(2) to reimburse the Trustee upon its request for all reasonable
expenses, disbursements and advances incurred or made by the Trustee in
accordance with any provision of this Indenture (including the reasonable
compensation and the expenses and disbursements of its agents and counsel),
except to the extent such expense, disbursement or advance may be
attributable to its negligence or bad faith; and
46
<PAGE>
(3) to indemnify the Trustee, its officers, directors, agents and
employees for, and to hold them harmless against, any loss, liability or
expense arising out of or in connection with the acceptance or
administration of this trust, including liability which the Trustee, its
officers, directors, agents and employees may incur as a result of failure
to withhold, pay or report taxes and including the costs and expenses of
defending themselves against any claim or liability in connection with the
exercise or performance of any of their powers or duties hereunder, except
in each case to the extent such loss, liability or expense may be
attributable to their negligence or bad faith.
As security for the performance of the obligations of the Company
under this Section the Trustee shall have a lien prior to the Debt Securities
upon all property and funds held or collected by the Trustee as such, except
funds held in trust for the payment of principal of (and premium, if any) or
interest, if any, on particular Debt Securities.
Subject to any other rights available to the Trustee under any
applicable Bankruptcy Law, when the Trustee incurs expenses or renders services
after an Event of Default specified in clause (5) or (6) of Section 501 has
occurred, the parties hereto and the Holders, by acceptance of the Debt
Securities, hereby agree that such expenses and compensation for services are
intended to constitute expenses of administration under any applicable
Bankruptcy Law.
The Trustee's rights under this Section 607 shall survive the
resignation or removal of the Trustee, the redemption of the Debt Securities and
the termination of this Indenture.
"TRUSTEE," for purposes of this Section 607, includes any predecessor
Trustee, provided that the negligence or bad faith of any Trustee shall not
affect the rights under this Section 607 of any other Trustee.
SECTION 608. Corporate Trustee Required; Eligibility.
---------------------------------------
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United States of
America or of any State, authorized under such laws to exercise corporate trust
powers, having a combined capital and surplus of at least $50,000,000, subject
to supervision or examination by Federal or State authority. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examin-
47
<PAGE>
ing authority, then for the purposes of this Section, the combined capital and
surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published. If at
any time the Trustee shall cease to be eligible in accordance with the
provisions of this Section, it shall resign immediately in the manner and with
the effect hereinafter specified in this Article.
The Trustee shall at all times be subject to the conflict of interest
provisions of TIA (S) 310(b), including the optional provision of TIA (S)
310(b)(9), permitted by the second sentence thereof. Furthermore, the conflict
of interest provisions of TIA (S) 310(b)(1) regarding conflicts arising between
different indentures shall also apply to any conflicts arising between series of
Debt Securities issued under this Indenture.
SECTION 609. Resignation and Removal; Appointment of Successor.
-------------------------------------------------
(a) No resignation or removal of the Trustee and no appointment of a
successor Trustee pursuant to this Article shall become effective until the
acceptance of appointment by the successor Trustee under Section 610.
(b) The Trustee may resign at any time with respect to the Debt
Securities of one or more series by giving written notice thereof to the
Company. If an instrument of acceptance by a successor Trustee shall not have
been delivered to the Trustee within 30 days after the giving of such notice of
resignation, the resigning Trustee may petition any court of competent
jurisdiction for the appointment of a successor Trustee with respect to that
series.
(c) The Trustee may be removed at any time with respect to the Debt
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Debt Securities of that series, delivered to the Trustee and
to the Company.
(d) If at any time:
(1) the Trustee shall cease to be eligible under Section 608 and shall
fail to resign after written request therefor by the Company or by any such
Holder, or
(2) the Trustee shall become incapable of acting or shall be adjudged
as bankrupt or insolvent, or a receiver of the Trustee or of its property
shall be appointed, or any public officer shall take charge or
48
<PAGE>
control of the Trustee or of its property or affairs for the purpose of
rehabilitation, conservation or liquidation,
then, in any such case, (i) the Company by a Board Resolution may remove the
Trustee with respect to all Debt Securities, or (ii) subject to Section 514, any
Holder who has been a bona fide Holder of a Debt Security of any series for at
least six months may, on behalf of himself and all others similarly situated,
petition any court of competent jurisdiction for the removal of the Trustee with
respect to the Debt Securities of that series and the appointment of a successor
Trustee.
(e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with
respect to the Debt Securities of one or more series, the Company, by a Board
Resolution, shall promptly appoint a successor Trustee with respect to the Debt
Securities of that or those series (it being understood that any such successor
Trustee may be appointed with respect to the Debt Securities of one or more or
all of that or those series and that at any time there shall be only one Trustee
with respect to the Debt Securities of any series). If, within one year after
such resignation, removal or incapability, or the occurrence of such vacancy, a
successor Trustee with respect to the Debt Securities of any series shall be
appointed by Act of the Holders of a majority in principal amount of the
Outstanding Debt Securities of that series delivered to the Company and the
retiring Trustee, the successor Trustee so appointed shall, forthwith upon its
acceptance of such appointment, become the successor Trustee with respect to the
Debt Securities of that series and supersede the successor Trustee appointed by
the Company. If no successor Trustee with respect to the Debt Securities of any
series shall have been so appointed by the Company or the Holders and accepted
appointment in the manner hereinafter provided, any Holder who has been a bona
fide Holder of a Debt Security of that series for at least six months may, on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the appointment of a successor Trustee with respect
to the Debt Securities of that series.
(f) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Debt Securities of any series and each
appointment of a successor Trustee with respect to the Debt Securities of any
series in the manner provided by Section 106. Each notice shall include the
name of the Successor Trustee with respect to the Debt Securities of that series
and the address of its Corporate Trust Office.
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SECTION 610. Acceptance of Appointment by Successor.
--------------------------------------
(a) In case of appointment hereunder of a successor Trustee with
respect to all Debt Securities, every such successor Trustee so appointed shall
execute, acknowledge and deliver to the Company and to the retiring Trustee an
instrument accepting such appointment, and thereupon the resignation or removal
of the retiring Trustee shall become effective and such successor Trustee,
without any further act, deed or conveyance, shall become vested with all the
rights, powers, trusts and duties of the retiring Trustee; but, on request of
the Company or the successor Trustee, such retiring Trustee shall, upon payment
of its charges, execute and deliver an instrument transferring to such successor
Trustee all the rights, powers and trusts of the retiring Trustee and shall duly
assign, transfer and deliver to such successor Trustee all property and money
held by such retiring Trustee hereunder, subject nevertheless to its lien, if
any, provided for in Section 607.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Debt Securities of one or more (but not all) series, the Company,
the retiring Trustee and each successor Trustee with respect to the Debt
Securities of one or more series shall execute and deliver an indenture
supplemental hereto wherein each successor Trustee shall accept such appointment
and which (1) shall contain such provisions as shall be necessary or desirable
to transfer and confirm to, and to vest in, each successor Trustee all the
rights, powers, trusts and duties of the retiring Trustee with respect of the
Debt Securities of that or those series to which the appointment of such
successor Trustee relates, (2) if the retiring Trustee is not retiring with
respect to all Debt Securities, shall contain such provisions as shall be deemed
necessary or desirable to confirm that all the rights, powers, trusts and duties
of the retiring Trustee with respect to the Debt Securities of that or those
series as to which the retiring Trustee is not retiring shall continue to be
vested in the retiring Trustee, and (3) shall add to or change any of the
provisions of this Indenture as shall be necessary to provide for or facilitate
the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall
constitute such Trustees as co-trustees of the same trust, that each such
Trustee shall be trustee of a trust or trusts hereunder separate and apart from
any trust or trusts hereunder administered by any other such Trustee and that no
Trustee shall be responsible for any notice given to, or received by, or any act
or failure to act on the part of any other Trustee hereunder, and upon the
execution and delivery of such supplemental indenture the resignation or removal
of the retiring Trustee shall become effective to the extent
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provided therein, such retiring Trustee shall with respect to the Debt
Securities of that or those series as to which the appointment of such successor
Trustee relates have no further responsibility for the exercise of rights and
powers or for the performance of the duties and obligations vested in the
Trustee under this Indenture other than as hereinafter expressly set forth, and
each such successor Trustee without any further act, deed or conveyance, shall
become vested with all the rights, powers, trusts and duties of the retiring
Trustee with respect to the Debt Securities of that or those series as to which
the appointment of such successor Trustee relates; but, on request of the
Company or any successor Trustee, such retiring Trustee shall duly assign,
transfer and deliver to such successor Trustee, to the extent contemplated by
such supplemental indenture, the property and money held by such retiring
Trustee hereunder with respect to the Debt Securities of that or those series as
to which the appointment of such successor Trustee relates.
(c) Upon request of any such successor Trustee, the Company shall
execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred
to in paragraph (a) or (b) of this Section, as the case may be.
No successor Trustee shall accept its appointment unless at the time
of such acceptance such successor Trustee shall be qualified under this Article.
SECTION 611. Merger, Conversion, Consolidation or Succession to Business.
-----------------------------------------------------------
Any corporation into which the Trustee may be merged or converted or
with which it may be consolidated, or any corporation resulting from any merger,
conversion or consolidation to which the Trustee shall be a party, or any
corporation succeeding to all or substantially all of the corporate trust
business of the Trustee, shall be the successor of the Trustee hereunder,
provided such corporation shall be otherwise qualified and eligible under this
- --------
Article, without the execution or filing of any paper or any further act on the
part of any of the parties hereto. In case any Debt Securities shall have been
authenticated, but not delivered, by the Trustee then in office, any successor
by merger, conversion or consolidation to such authenticating Trustee may adopt
such authentication and deliver the Debt Securities so authenticated with the
same effect as if such successor Trustee had itself authenticated such Debt
Securities.
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SECTION 612. Appointment of Authenticating Agent.
-----------------------------------
So long as any of the Debt Securities remain Outstanding, there may be
one or more Authenticating Agents appointed by the Trustee which shall be
authorized to act on behalf and subject to the direction of the Trustee with
respect to one or more series of Debt Securities to authenticate Debt Securities
issued upon exchange, registration of transfer or partial redemption thereof or
pursuant to Section 306, and Debt Securities so authenticated shall be entitled
to the benefits of this Indenture and shall be valid and obligatory for all
purposes as if authenticated by the Trustee hereunder. Wherever reference is
made in this Indenture to the authentication of Debt Securities by the Trustee
or the Trustee's certificate of authentication, such reference shall be deemed
to include authentication on behalf of the Trustee by an Authenticating Agent
and a certificate of authentication executed on behalf of the Trustee by an
Authenticating Agent. Each Authenticating Agent shall be subject to acceptance
by the Company and shall at all times be a corporation organized and doing
business under the laws of the United States of America or of any State thereof
or the District of Columbia, authorized under such laws to act as Authenticating
Agent, having a combined capital and surplus of at least $50,000,000 and subject
to supervision or examination by Federal or State authorities. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of the aforesaid supervising or examining authority, then
for the purposes of this Section, the combined capital and surplus of such
corporation shall be deemed to be its combined capital and surplus as set forth
in its most recent report of condition so published. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, such Authenticating Agent shall resign immediately
in the manner and with the effect hereinafter specified in this Section.
Any corporation into which an Authenticating Agent may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which an Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an Authenticating Agent, shall continue to be an
Authenticating Agent, provided such corporation shall be otherwise qualified and
--------
eligible under this Section, without the execution or filing of any paper or any
further act on the part of the Trustee or such Authenticating Agent, but such
Authenticating Agent shall give the Trustee written notice of any such merger,
conversion, consolidation or succession.
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Any Authenticating Agent may at any time resign by giving written
notice of resignation to the Trustee and to the Company. The Trustee may at any
time terminate the agency of any Authenticating Agent by giving written notice
of termination to such Authenticating Agent and to the Company. Upon receiving
such a notice of resignation or upon such a termination, or in case at any time
any Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee may appoint a successor Authenticating
Agent acceptable to the Company, in which case it shall give notice of such
appointment to Holders as provided in Section 106. Any successor Authenticating
Agent upon acceptance of its appointment hereunder shall become vested with all
the rights, powers and duties of its predecessor hereunder, with like effect as
if originally named as an Authenticating Agent herein. No successor
Authenticating Agent shall be appointed unless eligible under the provisions of
this Section.
The Trustee agrees to pay to each Authenticating Agent from time to
time reasonable compensation for its services, and the Trustee shall be entitled
to be reimbursed for such payments.
SECTION 613. Preferential Collection of Claims Against Company.
-------------------------------------------------
The Trustee shall at all times be subject to the provisions of TIA (S)
311(a), excluding any creditor relationship listed in TIA (S) 311(b). Any
Trustee who has resigned or been removed is subject to TIA (S) 311(a) to the
extent indicated.
SECTION 614. Reports by Trustee to Holders.
-----------------------------
Within 60 days after May 15 of each year, commencing May 15, 1997, the
Trustee shall transmit to Holders (including Holders identified in TIA (S)
313(c)) in the manner provided by Section 106 a brief report that complies with
the provisions of TIA (S) 313(a) and dated as of such reporting date. The
Trustee shall also comply with TIA (S) 313(b)(2).
A copy of each report at the time of its transmission to Holders shall
be filed with the SEC and each stock exchange on which the Debt Securities are
listed. The Company shall notify the Trustee when the Debt Securities are
listed on any stock exchange.
SECTION 615. Other Capacities.
----------------
Except as otherwise specifically provided herein, (i) all references
in this Indenture to the Trustee shall be
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deemed to refer to the Trustee in its capacity as Trustee and in its capacities
as Debt Securities Registrar and Paying Agent and (ii) every provision of this
Indenture relating to the conduct or affecting the liability or offering
protection, immunity or indemnity to the Trustee shall be deemed to apply with
the same force and effect to the Trustee acting in its capacities as Paying
Agent and Debt Securities Registrar.
SECTION 616. Notice of Default.
-----------------
The Trustee shall not be deemed to have or be charged with knowledge
of any default or Event of Default with respect to the Debt Securities of any
series for which it is acting as Trustee unless (a) a Responsible Officer of the
Trustee shall have actual knowledge of such default or Event of Default or (b)
written notice of such default or Event of Default shall have been given to the
Trustee by the Company or any other obligor on such Debt Securities or by any
Holder of such Debt Securities.
ARTICLE SEVEN
HOLDERS' LISTS
SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.
------------------------------------ --------------------
The Company will furnish or cause to be furnished to the Trustee
(a) not more than 15 days after each Regular Record Date, if any, for
each series of Debt Securities (or if no Regular Record Date exists or the
interval between Regular Record Dates is greater than six months then at least
every six months), a list, in such form as the Trustee may reasonably require,
containing all information in the possession or control of the Company, or of
any of its Paying Agents, as to the names and addresses of the Holders of
Registered Debt Securities of that series as of such Regular Record Date, and
(b) at such other times as the Trustee may request in writing, within
30 days after the receipt by the Company of any such request, a list of similar
form and content as of a date not more than 15 days prior to the time such list
is furnished provided, however, that so long as the Trustee is the Debt
-------- -------
Securities Registrar, no such list shall be required to be furnished.
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The Trustee shall preserve, in as current a form as is reasonably
practicable, all such information furnished to it or received by it in its
capacity as Paying Agent.
For purposes of this Section 701, the term "COMPANY" also includes any
other obligor.
ARTICLE EIGHT
CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE;
CREATION OF LIENS
SECTION 801. Company May Consolidate, Etc., Only on Certain Terms.
----------------------------------------------------
The Company shall not consolidate with or merge into any other
Corporation, or convey, lease or transfer its properties and assets
substantially as an entirety to any Person, unless:
(1) the Corporation formed by such consolidation or into which the
Company is merged or the Person which acquires by conveyance, lease or
transfer the properties and assets of the Company substantially as an
entirety shall be a Corporation organized and existing under the laws of
the United States of America or any State or the District of Columbia, and
shall expressly assume, by an indenture supplemental hereto, executed and
delivered to the Trustee, in form satisfactory to the Trustee, the due and
punctual payment of the principal of (and premium, if any) and interest, if
any, on all the Debt Securities and the performance of every covenant of
this Indenture on the part of the Company to be performed or observed;
(2) immediately after giving effect to such transaction, no Event of
Default, and no event which, after notice or lapse of time, or both, would
become an Event of Default, shall have happened and be continuing; and
(3) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that such consolidation, merger,
conveyance, lease or transfer and such supplemental indenture comply with
this Article and that all conditions precedent herein provided for relating
to such transaction have been complied with.
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SECTION 802. Successor Corporation Substituted.
---------------------------------
Upon any consolidation or merger, or any conveyance, lease or transfer
of the properties and assets of the Company substantially as an entirety, of the
type described in and in accordance with Section 801, the successor corporation
formed by such consolidation or into which the Company is merged or to which
such conveyance, lease or transfer is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company under this Indenture
with the same effect as if such successor corporation had been named as the
Company herein, and thereafter the predecessor corporation, except in the event
of a conveyance by way of lease, shall be relieved of all obligations and
covenants under this Indenture and the Debt Securities. Such successor
corporation thereupon may cause to be signed, and may issue either in its own
name or in the name of the Company, any or all of the Debt Securities issuable
hereunder which theretofore shall not have been signed by the Company and
delivered to the Trustee; and, upon the order of such successor corporation,
instead of the Company, and subject to all the terms, conditions and limitations
in this Indenture prescribed, the Trustee shall authenticate and shall deliver
any Debt Security which previously shall have been signed and delivered by the
officers of the Company to the Trustee for authentication, and any Debt
Securities which such successor corporation thereafter shall cause to be signed
and delivered to the Trustee for that purpose. All the Debt Securities so
issued shall in all respects have the same legal rank and benefit under this
Indenture as the Debt Securities theretofore or thereafter issued in accordance
with the terms of this Indenture as though all of such Debt Securities had been
issued at the date of execution hereof.
In case of any such consolidation, merger, sale or conveyance such
changes in phraseology and form (but not in substance) may be made in the Debt
Securities thereafter to be issued as may be appropriate.
ARTICLE NINE
SUPPLEMENTAL INDENTURES
SECTION 901. Supplemental Indentures Without Consent
---------------------------------------
of Holders.
----------
Without the consent of any Holders, the Company, when authorized by a
Board Resolution, and the Trustee, at any time and from time to time, may enter
into one or more indentures supplemental hereto, in form satisfactory to the
Trustee, for any of the following purposes:
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(1) to evidence the succession of another corporation to the Company,
and the assumption by any such successor of the covenants of the Company
herein and in the Debt Securities contained; or
(2) to add to the covenants of the Company, for the benefit of the
Holders of all or any series of Debt Securities (and if such covenants are
to be for the benefit of less than all series of Debt Securities, stating
that such covenants are expressly being included solely for the benefit of
that series) or to surrender any right or power herein conferred upon the
Company; or
(3) to establish the form or terms of Debt Securities of any series as
permitted by Sections 201 or 301; or
(4) to cure any ambiguity, to correct or supplement any provision
herein or in any supplemental indenture which may be defective or
inconsistent with any other provision herein, or to make any other
provisions with respect to matters or questions arising under this
Indenture, provided such action pursuant to this clause (4) shall not
--------
adversely affect the interests of the Holders of Debt Securities of any
series in any material respect; or
(5) to add to, delete from or revise the conditions, limitations and
restrictions on the authorized amount, terms or purposes of issue,
authentication and delivery of Debt Securities of one or more series, as
herein set forth; or
(6) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the Debt Securities of one
or more series and to add to or change any of the provisions of this
Indenture as shall be necessary to provide for or facilitate the
administration of the trusts hereunder by more than one Trustee, pursuant
to the requirement of Section 610(b).
SECTION 902. Supplemental Indentures with Consent of Holders.
-----------------------------------------------
With the consent of the Holders of not less than a majority in
principal amount of the Outstanding Debt Securities of each series affected by
such supplemental indenture, by Act of said Holders delivered to the Company and
the Trustee, the Company, when authorized by a Board Resolution, and the Trustee
may enter into an indenture or indentures supplemental hereto for the purpose of
adding any provisions
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to or changing in any manner or eliminating any of the provisions of this
Indenture or of modifying in any manner the rights of the Holders of Debt
Securities of that series under this Indenture; provided, however, that no such
-------- -------
supplemental indenture shall, without the consent of the Holder of each
Outstanding Debt Security affected thereby,
(1) change the Stated Maturity of the principal of, or any installment
of interest on, any Debt Security, or reduce the principal amount thereof
or the rate of interest thereon or any premium payable upon the redemption
thereof, or reduce the amount of the principal of an Original Issue
Discount Debt Security that would be due and payable upon a declaration of
acceleration of the Maturity thereof pursuant to Section 502, or change the
coin or currency in which, the principal of (or premium, if any, on) any
Debt Security or the interest, if any, thereon is payable, or impair the
right to institute suit for the enforcement of any such payment on or after
the Stated Maturity thereof (or, in the case of redemption, on or after the
Redemption Date), or modify the provisions of this Indenture with respect
to the conversion or exchange of the Debt Securities into Common Stock or
into Debt Securities of another series in a manner adverse to the Holders,
(2) reduce the percentage in principal amount of the Outstanding Debt
Securities of any series, the consent of whose Holders is required for any
such supplemental indenture, or the consent of whose Holders is required
for any waiver (of compliance with certain provisions of this Indenture or
certain defaults hereunder and their consequences) provided for in this
Indenture, or
(3) modify any of the provisions of this Section or Section 513 or
Section 1005, except to increase any such percentage or to provide that
certain other provisions of this Indenture cannot be modified or waived
without the consent of the Holder of each Outstanding Debt Security
affected thereby.
A supplemental indenture which changes or eliminates any covenant or
other provision of this Indenture which has expressly been included solely for
the benefit of one or more particular series of Debt Securities, or which
modifies the rights of the Holders of Debt Securities of that series with
respect to such covenant or other provision, shall be deemed not to affect the
rights under this Indenture of the Holders of Debt Securities of any other
series.
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It shall not be necessary for any Act of Holders under this Section to
approve the particular form of any proposed supplemental indenture, but it shall
be sufficient if such Act shall approve the substance thereof.
SECTION 903. Execution of Supplemental Indentures.
------------------------------------
In executing, or accepting the additional trusts created by, any
supplemental indenture permitted by this Article or the modifications thereby of
the trusts created by this Indenture, the Trustee shall be entitled to receive,
and (subject to Section 601) shall be fully protected in relying upon, an
Opinion of Counsel stating that the execution of such supplemental indenture is
authorized or permitted by this Indenture. The Trustee may, but shall not be
obligated to, enter into any such supplemental indenture which adversely affects
the Trustee's own rights, duties or immunities under this Indenture or
otherwise.
SECTION 904. Effect of Supplemental Indentures.
---------------------------------
Upon the execution of any supplemental indenture under this Article,
this Indenture shall be modified in accordance therewith, and such supplemental
indenture shall form a part of this Indenture for all purposes; and every Holder
of Debt Securities theretofore or thereafter authenticated and delivered
hereunder shall be bound thereby. Any supplemental indenture executed under
this Article shall comply in all respects with the requirements of the TIA.
SECTION 905. Reference in Debt Securities to Supplemental Indentures.
-------------------------------------------------------
Debt Securities of any series authenticated and delivered after the
execution of any supplemental indenture pursuant to this Article may, and shall
if required by the Trustee, bear a notation in form approved by the Trustee as
to any matter provided for in such supplemental indenture. If the Company shall
so determine, new Debt Securities of any series so modified as to conform, in
the opinion of the Trustee and the Board of Directors, to any such supplemental
indenture may be prepared and executed by the Company and authenticated and
delivered by the Trustee in exchange for Outstanding Debt Securities of that
series.
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ARTICLE TEN
COVENANTS
SECTION 1001. Payment of Principal, Premium and Interest.
------------------------------------------
The Company will duly and punctually pay the principal of (and
premium, if any) and interest (including any additional interest provided for in
an Officers' Certificate or supplemental indenture referred to in Section 301
with respect to any Debt Securities of a series), if any, on the Debt Securities
in accordance with the terms of the Debt Securities and this Indenture.
SECTION 1002. Maintenance of Office or Agency.
-------------------------------
The Company will maintain in the City of New York, an office or agency
or offices or agencies where, unless otherwise set forth in the Officers'
Certificate or supplemental indenture referred to in Section 301 with respect to
any Debt Securities of a series, Debt Securities may be presented or surrendered
for payment, Debt Securities may be surrendered for registration of transfer or
exchange, and notices and demands to or upon the Company in respect of the Debt
Securities and this Indenture may be served. The Company initially appoints the
Trustee at its Corporate Trust Office, as its agent for purposes of presentation
or surrender of Debt Securities for payment, registration of transfer, exchange
or conversion and for service of notices or demands to or upon it in respect of
the Debt Securities and this Indenture. The Company will give prompt written
notice to the Trustee of the location, and any change in the location, of any
such office or agency. If at any time the Company shall fail to maintain such
office or agency or shall fail to furnish the Trustee with the address thereof,
such presentations, surrenders, notices and demands may be made or served at the
Corporate Trust Office of the Trustee, and the Company hereby appoints the
Corporate Trust Office of the Trustee its agent to receive all such
presentations, surrenders, notices and demands.
In addition to such office or agency, the Company may from time to
time designate one or more other offices or agencies where the Debt Securities
of one or more series may be presented or surrendered for any or all of the
purposes specified above in this Section and may constitute and appoint one or
more Paying Agents for the payment of the Debt Securities of that or those
series in one or more other cities, and may from time to time rescind such
designations and appointments, as the Company may deem desirable or expedient;
provided, however, that no such designation, appointment or rescission shall in
- -------- -------
any manner relieve the
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Company of its obligation to maintain such office and agency in the City of New
York for the purposes above mentioned.
SECTION 1003. Money for Debt Security Payments to be Held in Trust.
----------------------------------------------------
If the Company shall at any time act as its own Paying Agent with
respect to any series of Debt Securities, it will, on or before each due date of
the principal of (and premium, if any) or interest, if any, on any of the Debt
Securities of that series, segregate and hold in trust for the benefit of the
Persons entitled thereto a sum sufficient to pay the principal (and premium, if
any) or interest, if any, so becoming due until such sums shall be paid to such
Persons or otherwise disposed of as herein provided, and will promptly notify
the Trustee of its action or failure so to act.
Whenever the Company shall have one or more Paying Agents for any
series of Debt Securities, it will, prior to each due date of the principal of
(and premium, if any) or interest, if any, on any Debt Securities of that
series, deposit with a Paying Agent a sum sufficient to pay the principal (and
premium, if any) or interest, if any, so becoming due, such sum to be held in
trust for the benefit of the Persons entitled to such principal, premium or
interest, and (unless such Paying Agent is the Trustee) the Company will
promptly notify the Trustee of its action or failure so to act.
The Company will cause each Paying Agent for any series of Debt
Securities other than the Trustee to execute and deliver to the Trustee an
instrument in which such Paying Agent shall agree with the Trustee, subject to
the provisions of this Section, that such Paying Agent will:
(1) hold all sums held by it for the payment of the principal of (and
premium, if any) or interest, if any, on Debt Securities of that series in
trust for the benefit of the Persons entitled thereto until such sums shall
be paid to such Persons or otherwise disposed of as herein provided;
(2) give the Trustee notice of any default by the Company (or any
other obligor upon the Debt Securities of that series) in the making of any
payment of principal (and premium, if any) or interest, if any, on the Debt
Securities of that series; and
(3) at any time during the continuance of any such default, upon the
written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent.
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The Company may at any time, for the purpose of obtaining the
satisfaction and discharge of this Indenture or for any other purpose, pay, or
by Company Order direct any Paying Agent to pay, to the Trustee all sums held in
trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same trusts as those upon which such sums were held by the Company or
such Paying Agent; and, upon such payment by any Paying Agent to the Trustee,
such Paying Agent shall be released from all further liability with respect to
such money.
Subject to applicable escheat laws, any money deposited with the
Trustee or any Paying Agent, or then held by the Company, in trust for the
payment of the principal of (and premium, if any) or interest, if any, on any
Debt Security of any series and remaining unclaimed for three years after such
principal (and premium, if any) or interest, if any, has become due and payable
shall be paid to the Company on Company Request, or (if then held by the
Company) shall be discharged from such trust; and the Holder of such Debt
Security shall thereafter, as an unsecured general creditor, look only to the
Company for payment thereof, and all liability of the Trustee or such Paying
Agent with respect to such trust money, and all liability of the Company as
trustee thereof, shall thereupon cease; provided, however, that the Trustee or
-------- -------
such Paying Agent, before being required to make any such repayment, may at the
expense of the Company cause to be published once, in a newspaper published in
the English language, customarily published on each Business Day and of general
circulation in The City of New York, notice that such money remains unclaimed
and that, after a date specified therein, which shall not be less than 30 days
from the date of such publication, any unclaimed balance of such money then
remaining will be repaid to the Company.
SECTION 1004. Statement as to Compliance.
--------------------------
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year, a written statement, which need not comply with Section
102, signed by the principal financial, principal executive or principal
accounting officer stating that:
(1) a review of the activities of the Company during such year and of
performance under this Indenture has been made under his supervision, and
(2) to the best of his knowledge, based on such review, (a) the
Company has fulfilled all its obligations under this Indenture throughout
such year, or, if there has been a default in the fulfillment of any such
obligation, specifying each such default known to him
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and the nature and status thereof, and (b) no event has occurred and is
continuing which is, or after notice or lapse of time or both would become,
an Event of Default, or, if such an event has occurred and is continuing,
specifying each such event known to him and the nature and status thereof.
SECTION 1005. Waiver of Certain Covenants.
---------------------------
The Company may omit in any particular instance to comply with any
covenant or condition set forth in Section 1004 with respect to the Debt
Securities of any series, if before or after the time for such compliance the
Holders of at least a majority in principal amount of the Debt Securities of
that series at the time Outstanding shall, by Act of such Holders, either waive
such compliance in such instance or generally waive compliance with such
covenant or condition, but no such waiver shall extend to or affect such
covenant or condition except to the extent so expressly waived, and, until such
waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such covenant or condition shall remain in full
force and effect.
SECTION 1006. SEC Reports.
-----------
The Company shall file with the Trustee within 15 days after it files
them with the SEC copies of the annual reports and of the information,
documents, and other reports (or copies of such portions of any of the foregoing
as the SEC may by rules and regulations prescribe) which the Company is required
to file with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934. The Company shall also comply with the other provisions of TIA (S)
314(a) concerning the filing and transmission of reports to the SEC, the Trustee
and Holders.
SECTION 1007. Limitations on Dividends, Distributions and Acquisitions of
-----------------------------------------------------------
Capital Stock.
-------------
The Company will not declare or pay any dividends or make any
distribution to holders of its capital stock (other than dividends or
distributions payable in capital stock of the Company or other than as the
Company determines is necessary to maintain its status as a REIT), or purchase,
redeem or otherwise acquire or retire for value any of its capital stock or any
warrants, rights or options (including any securities convertible into or
exercisable for such capital stock but not including the Debt Securities) to
purchase or acquire any shares of its capital stock or permit any Subsidiary to
purchase, redeem or otherwise acquire or retire for value any of the Company's
capital stock or any warrants, rights or options (including any
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securities convertible into or exercisable for such capital stock but not
including the Debt Securities) to purchase or acquire any shares of the
Company's capital stock if at the time of such action an Event of Default has
occurred and is continuing or would exist immediately after giving effect to
such action.
Notwithstanding the foregoing, the provisions of this Section 1007
will not prevent (i) the payment of any dividend within 60 days after the date
of declaration when the payment would have complied with the foregoing
provisions on the date of declaration; (ii) the retirement of any share of the
Company's capital stock by exchange for, or out of the proceeds of the
substantially concurrent sale (other than to a Subsidiary) of, other shares of
its capital stock.
ARTICLE ELEVEN
REDEMPTION OF DEBT SECURITIES
SECTION 1101. Right of Redemption.
-------------------
Redemption of Debt Securities of any series at the option of the
Company as permitted or required by the terms of such Debt Securities shall be
made in accordance with the terms of such Debt Securities and this Article;
provided, however, that if as a result of such redemption any Holder would
become the Beneficial Owner of more than 9.9% of the outstanding stock of the
Company because such Holder's Debt Securities were not redeemed, or were
redeemed only in part, then the Company will redeem the requisite number of Debt
Securities of such Holder such that such Holder will not Beneficially Own more
than 9.9% of the outstanding stock of the Company. The Debt Securities also
shall be subject to redemption, in whole or from time to time in part, at any
time in order to protect the Company's status as a REIT, at the option of the
Company at a redemption price equal to 100% of the principal amount, plus
accrued interest to the date of redemption.
SECTION 1102. Election to Redeem; Notice to Trustee.
-------------------------------------
The election of the Company to redeem any Debt Securities pursuant to
Section 1101 shall be evidenced by a Board Resolution. The Company shall, at
least 60 days prior to the Redemption Date fixed by the Company (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date and, in the case of any redemption at the election of the
Company of less than all the Debt Securities of any series, of the principal
amount of Debt Securities of that series to be redeemed.
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SECTION 1103. Selection by Trustee of Debt Securities to be Redeemed.
------------------------------------------------------
If less than all the Debt Securities of any series with the same issue
date and Stated Maturity are to be redeemed, the particular Debt Securities to
be redeemed shall be selected not more than 60 days prior to the Redemption Date
by the Trustee, from the Outstanding Debt Securities of that series not
previously called for redemption, by such method as specified in the Officers'
Certificate or supplemental indenture referred to in Section 301 or, if not so
specified, by such method as the Trustee shall deem fair and appropriate and
which may provide for the selection for redemption of portions (equal to
$100,000 or an integral multiple of $1,000 above $100,000) of the principal of
Debt Securities of that series of a denomination larger than $100,000. The
portions of the principal of Debt Securities of that series so selected for
partial redemption shall be equal to the smallest authorized denomination of the
Debt Securities of that series or an integral multiple of $1,000 above $100,000.
The portion of the principal of any Debt Security not redeemed shall not be less
than the smallest authorized denomination of the Debt Securities of that series.
The Trustee shall promptly notify the Company and each Debt Securities
Registrar in writing of the Debt Securities selected for redemption and, in the
case of any Debt Securities selected for partial redemption, the principal
amount thereof to be redeemed.
For all purposes of this Indenture, unless the context otherwise
requires, all provisions relating to the redemption of Debt Securities shall
relate, in the case of any Debt Security redeemed or to be redeemed only in
part, to the portion of the principal of such Debt Security which has been or is
to be redeemed.
SECTION 1104. Notice of Redemption.
--------------------
Notice of redemption shall be given in the manner provided in Section
106 not less than 30 nor more than 60 days prior to the Redemption Date unless a
shorter period is specified in the Debt Security of the series to be redeemed,
to each Holder of Debt Securities to be redeemed, but failure to give such
notice in the manner herein provided to the Holder of any Debt Securities
designated for redemption as a whole or in part, or any defect in the notice to
any such Holder, shall not affect the validity of the proceedings for the
redemption of any other such Debt Securities or portion thereof.
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Any notice that is mailed in the manner herein provided shall be
conclusively presumed to have been given, whether or not the Holder receives the
notice.
All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price and the amount of accrued interest, if any,
to be paid,
(3) if less than all the Outstanding Debt Securities of any series
are to be redeemed, the identification (and, in the case of partial
redemption, the principal amounts) of the particular Debt Securities to be
redeemed,
(4) in case any Debt Security is to be redeemed in part only, the
notice which relates to such Debt Security shall state that on and after
the Redemption Date, upon surrender of such Debt Security, the Holder will
receive, without charge, a new Debt Security or Debt Securities of
authorized denominations for the principal amount thereof remaining
unredeemed,
(5) that on the Redemption Date the Redemption Price and accrued
interest, if any, will become due and payable upon each such Debt Security
to be redeemed and, if applicable, that the interest thereon will cease to
accrue on and after said date,
(6) the place or places where such Debt Securities are to be
surrendered for payment of the Redemption Price and accrued interest, if
any, and
(7) the conversion rights, if any, pertaining to such Debt
Securities.
Notice of redemption of Debt Securities to be redeemed at the election
of the Company shall be given by the Company or, at the Company's request, by
the Trustee in the name of and at the expense of the Company.
SECTION 1105. Deposit of Redemption Price.
---------------------------
Prior to each Redemption Date, the Company shall deposit with the
Trustee or with a Paying Agent (or, if the Company is acting as its own Paying
Agent, segregate and hold in trust as provided in Section 1003) an amount of
money sufficient to pay the Redemption Price of, and (unless the Redemption Date
shall be an Interest Payment Date) accrued interest on, all the Debt Securities
or portions thereof which are to be redeemed on that date.
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SECTION 1106. Debt Securities Payable on Redemption Date.
------------------------------------------
Notice of redemption having been given as aforesaid, the Debt
Securities so to be redeemed shall, on the Redemption Date, become due and
payable at the Redemption Price therein specified, and from and after such date
(unless the Company shall default in the payment of the Redemption Price and
accrued interest) such Debt Securities shall cease to bear interest. Upon
surrender of any such Debt Security for redemption in accordance with said
notice, such Debt Security shall be paid by the Company at the Redemption Price,
together with accrued interest to the Redemption Date; provided, however, that
-------- -------
notwithstanding any other provision of this Indenture and unless otherwise
specified in the Officers' Certificate or supplemental indenture referred to in
Section 301 with respect to such Debt Security, installments of interest whose
Stated Maturity is on or prior to the Redemption Date shall be payable (but
without interest thereon, unless the Company shall default in the payment
thereof in which case the provisions of Section 307 shall apply) to the Holders
of such Debt Securities or one or more Predecessor Debt Securities, registered
as such at the close of business on the relevant Record Dates according to their
terms and the provisions of Section 307.
If any Debt Security called for redemption shall not be so paid upon
surrender thereof for redemption, the principal (and premium, if any) shall,
until paid, bear interest, to the extent lawful, from the Redemption Date at the
rate borne by the Debt Security.
SECTION 1107. Debt Securities Redeemed in Part.
--------------------------------
Any Debt Security which is to be redeemed only in part shall be
surrendered at the office or agency of the Company designated for that purpose
pursuant to Section 1002 (with, if the Company or the Trustee so requires, due
endorsement by, or a written instrument of transfer in form satisfactory to the
Company and the Trustee duly executed by, the Holder thereof or his attorney
duly authorized in writing) and the Company shall execute and the Trustee shall
authenticate and deliver to the Holder of such Debt Security without service
charge a new Debt Security or Debt Securities of any authorized denomination of
the same series as requested by such Holder, in aggregate principal amount equal
to and in exchange for the unredeemed portion of the principal of the Debt
Security so surrendered. If a Global Debt Security is so surrendered, such new
Debt Security so issued shall be a new Global Debt Security.
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ARTICLE TWELVE
SINKING FUND
SECTION 1201. Mandatory and Optional Sinking Fund Payments.
--------------------------------------------
The provisions of this Article shall be applicable to any sinking fund
for the retirement of Debt Securities of any series, except as otherwise
permitted or required by any form of Debt Security of that series issued
pursuant to this Indenture.
The minimum amount of any sinking fund payment provided for by the
terms of Debt Securities of any series is herein referred to as a "MANDATORY
SINKING FUND PAYMENT", and any payment in excess of that minimum amount provided
for by the terms of Debt Securities of that series is herein referred to as an
"OPTIONAL SINKING FUND PAYMENT". If provided for by the terms of Debt
Securities of any series, the cash amount of any sinking fund payment may be
subject to reduction as provided in Section 1202. Each sinking fund payment
shall be applied to the redemption of Debt Securities of any series as provided
for by the terms of Debt Securities of that series.
SECTION 1202. Satisfaction of Sinking Fund Payments with Debt Securities.
----------------------------------------------------------
The Company may, in satisfaction of all or any part of any sinking
fund payment with respect to the Debt Securities of any series to be made
pursuant to the terms of such Debt Securities as provided for by the terms of
that series, (1) deliver Outstanding Debt Securities of that series (other than
any of such Debt Securities previously called for redemption or any of such Debt
Securities in respect of which cash shall have been released to the Company),
(2) apply as a credit Debt Securities of that series which have been redeemed
either at the election of the Company pursuant to the terms of that series of
Debt Securities or through the application of permitted optional sinking fund
payments pursuant to the terms of such Debt Securities, provided that such
--------
series of Debt Securities have not been previously so credited and (3) apply as
a credit Debt Securities of that series which have been converted or exchanged
into Common Stock or Debt Securities of another series pursuant to the terms of
that series of Debt Securities, provided that such series of Debt Securities
--------
have not been previously so credited. Such Debt Securities shall be received
and credited for such purpose by the Trustee at the Redemption Price specified
in such Debt Securities for redemption through operation of the sinking fund and
the amount of such sinking fund payment
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shall be reduced accordingly. If as a result of the delivery or credit of Debt
Securities of any series in lieu of cash payments pursuant to this Section, the
principal amount of Debt Securities of that series to be redeemed in order to
exhaust the aforesaid cash payment shall be less than $100,000, the Trustee need
not call Debt Securities of that series for redemption, except upon Company
Request, and such cash payment shall be held by the Trustee or a Paying Agent
and applied to the next succeeding sinking fund payment, provided, however, that
-------- -------
the Trustee or such Paying Agent shall at the request of the Company from time
to time pay over and deliver to the Company any cash payment so being held by
the Trustee or such Paying Agent upon delivery by the Company to the Trustee of
Debt Securities of that series purchased by the Company having an unpaid
principal amount equal to the cash payment requested to be released to the
Company.
SECTION 1203. Redemption of Debt Securities for Sinking Funds.
-----------------------------------------------
Not less than 60 days prior to each sinking fund payment date for any
series of Debt Securities, the Company will deliver to the Trustee an Officers'
Certificate specifying the amount of the next ensuing mandatory sinking fund
payment for that series pursuant to the terms of that series, the portion
thereof, if any, which is to be satisfied by payment of cash and the portion
thereof, if any, which is to be satisfied by delivering and crediting of Debt
Securities of that series pursuant to Section 1202, and the optional amount, if
any, to be added in cash to the next ensuing mandatory sinking fund payment, and
will also deliver to the Trustee any Debt Securities to be so credited and not
theretofore delivered. If such Officers' Certificate shall specify an optional
amount to be added in cash to the next ensuing mandatory sinking fund payment,
the Company shall thereupon be obligated to pay the amount therein specified.
Not less than 30 days before each such sinking fund payment date the Trustee
shall select the Debt Securities to be redeemed upon such sinking fund payment
date in the manner specified in Section 1103 and cause notice of the redemption
thereof to be given in the name of and at the expense of the Company in the
manner provided in Section 1104. Such notice having been duly given, the
redemption of such Debt Securities shall be made upon the terms and in the
manner stated in Section 1106 and 1107.
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ARTICLE THIRTEEN
CONVERSION OF DEBT SECURITIES
SECTION 1301. Conversion Privilege.
--------------------
Conversion of Debt Securities of any series into Common Stock of the
Company as permitted by the terms of such Debt Securities shall be made in
accordance with the terms of such Debt Securities and this Article. "COMMON
STOCK" used herein in Article Thirteen means the Common Stock of the Company on
the date the Debt Securities of such series are issued. Notwithstanding the
foregoing, and in order to protect the Company's status as a REIT, a Holder may
not convert any Debt Security, and any such Debt Security shall not be
convertible by any Holder, if as a result of such conversion any Person would
then be deemed to Beneficially Own more than 9.9% of the outstanding stock of
the Company. Except as otherwise set forth herein, the Trustee shall have no
duties or responsibilities in respect of the conversion privilege or of any
matter relating thereto, including without limitation the determination of the
conversion price or any adjustment thereto.
SECTION 1302. Exercise of Conversion Privilege.
--------------------------------
In order to exercise the conversion privilege, the Holder of any Debt
Security of any series to be converted shall surrender such Debt Security, duly
endorsed or assigned to the Company or in blank, at any office or agency of the
Company maintained for that purpose, accompanied by written notice to the
Company at such office or agency that the Holder elects to convert such Debt
Security or, if less than the entire principal amount thereof is to be
converted, the portion thereof to be converted. Debt Securities surrendered for
conversion during the period from the close of business on any Regular Record
Date for the payment of interest on the Debt Securities of that series to the
opening of business on the Interest Payment Date for such interest shall (except
in the case of Debt Securities of that series or portions thereof which have
been called for redemption on a Redemption Date within such period) be
accompanied by payment of an amount equal to the interest payable on such
Interest Payment Date on the principal amount of Debt Securities being
surrendered for conversion. Except as provided in the preceding sentence, no
payment or adjustment shall be made upon any conversion on account of any
interest accrued on the Debt Securities of that series surrendered for
conversion or on account of any dividends on the Common Stock issued upon
conversion.
Debt Securities of any series shall be deemed to have been converted
immediately prior to the close of
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business on the day of surrender of such Debt Security for conversion in
accordance with the foregoing provisions, and at such time the rights of the
Holder of such Debt Security as Holder shall cease, and the Person or Persons
entitled to receive the Common Stock issuable upon conversion shall be treated
for all purposes as the record holder or holders of such Common Stock at such
time. As promptly as practicable on or after the conversion date, the Company
shall issue and shall deliver at said office or agency a certificate or
certificates for the number of full shares of Common Stock issuable upon
conversion, together with payment in lieu of any fraction of a share, as
provided in Section 1303.
In the case of any Debt Security which is converted in part only, upon
such conversion the Company shall execute and the Trustee shall authenticate and
deliver to the Holder thereof, at the expense of the Company, a new Debt
Security or Debt Securities of authorized denominations in aggregate principal
amount equal to the unconverted portion of the principal amount of such Debt
Security.
SECTION 1303. Fractions of Shares.
-------------------
No fractional shares of Common Stock shall be issued upon conversion
of Debt Securities. If more than one Debt Security shall be surrendered for
conversion at one time by the same Holder, the number of full shares which shall
be issuable upon conversion thereof shall be computed on the basis of the
aggregate principal amount of the Debt Securities (or specified portions
thereof) so surrendered. Instead of any fractional share of Common Stock which
would otherwise be issuable upon conversion of any Debt Security or Debt
Securities (or specified portions thereof), the Company shall pay a cash
adjustment in respect of such fraction in an amount equal to the same fraction
of the closing price per share of Common Stock on the day of conversion. The
closing price shall be the reported last sale price of the Common Stock on the
New York Stock Exchange -- Composite Transactions or, in case no such reported
sale takes place on such day, the average of the reported closing bid and asked
prices regular way on the New York Stock Exchange, or if the Common Stock is not
listed or admitted to trading on such Exchange, on the principal national
exchange on which the Common Stock is listed or admitted to trading or, if not
listed or admitted to trading on any national securities exchange, the average
of the closing bid and asked prices as furnished by any New York Stock Exchange
member firm selected from time to time by the Company for that purpose.
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SECTION 1304. Adjustments of Conversion Price.
-------------------------------
(1) In the case the Company shall pay or make a dividend or other
distribution on any class of capital stock of the Company in Common Stock after
the issuance of a Debt Security entitled to exercise the conversion privilege,
the conversion price of such Debt Security in effect at the opening of business
on the day following the date fixed for the determination of stockholders
entitled to receive such dividend or other distribution shall be reduced by
multiplying such conversion price by a fraction of which the numerator shall be
the number of shares of Common Stock outstanding at the close of business on the
date fixed for such determination and the denominator shall be the sum of such
number of shares and the total number of shares constituting such dividend or
other distribution, such reduction to become effective immediately after the
opening of business on the day following the date fixed for such determination.
For the purposes of this paragraph (1), the number of shares of Common Stock at
any time outstanding shall include shares issuable in respect of scrip
certificates issued in lieu of fractions of shares of Common Stock.
(2) In case the Company shall issue, after the issuance of a Debt
Security entitled to the conversion privilege, rights or warrants to all holders
of its Common Stock entitling them to subscribe for or purchase shares of Common
Stock at a price per share less than the current market price per share
(determined as provided in paragraph (6) of this Section) of the Common Stock on
the date fixed for the determination of stockholders entitled to receive such
rights or warrants, the conversion price for such Debt Security in effect at the
opening of business on the day following the date fixed for such determination
shall be reduced by multiplying such conversion price by a fraction of which the
numerator shall be the number of shares of Common Stock outstanding at the close
of business on the date fixed for such determination plus the number of shares
of Common Stock which the aggregate of the offering price of the total number of
shares of Common Stock so offered for subscription or purchase would purchase at
such current market price and the denominator shall be the number of shares of
Common Stock outstanding at the close of business on the date fixed for such
determination plus the number of shares of Common Stock so offered for
subscription or purchase, such reduction to become effective immediately after
the opening of business on the day following the date fixed for such
determination; provided, however, that if all the shares of Common Stock offered
for subscription or purchase are not subscribed for or purchased, upon the
expiration of such rights or warrants the conversion price shall be immediately
readjusted to what would have been the
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conversion price had the above-referenced fraction been calculated with
reference to the actual number of shares of Common Stock subscribed for or
purchased rather than the number of shares of Common Stock offered for
subscription or purchase. For the purposes of this paragraph (2), the number of
shares of Common Stock at any time outstanding shall include shares issuable in
respect of scrip certificates issued in lieu of fractions of shares of Common
Stock. For purposes of this paragraph (2), the granting of the right to
purchase shares of Common Stock pursuant to any shareholder rights plan, any
dividend or interest reinvestment plan and/or any Common Stock purchase plan
providing for the reinvestment of dividends or interest payable on securities of
the Company and/or the investment of periodic optional payments at a price per
share of not less than 95 percent of the current market price per share
(determined as provided in such plans) of the Common Stock (so long as such
right to purchase is in no case evidenced by the delivery of rights or warrants)
shall be deemed not to constitute an issue of rights or warrants by the Company
within the meaning of this paragraph (2).
(3) In case outstanding shares of Common Stock shall be subdivided
into a greater number of shares of Common Stock after the issuance of a Debt
Security entitled to the conversion privilege, the conversion price for such
Debt Security in effect at the opening of business on the day following the day
upon which such subdivision becomes effective shall be proportionately reduced,
and, conversely, in case outstanding shares of Common Stock shall each be
combined into a smaller number of shares of Common Stock, the conversion price
of such Debt Security in effect at the opening of business on the day following
the day upon which such combination becomes effective shall be proportionately
increased, such reduction or increase, as the case may be, to become effective
immediately after the opening of business on the day following the day upon
which such subdivision or combination becomes effective.
(4) In case the Company shall, after the issuance of a Debt Security
entitled to the conversion privilege, by dividend or otherwise, distribute to
all holders of its Common Stock evidences of its indebtedness or assets
(including securities, but excluding any dividend or distribution referred to in
paragraph (1) of this Section, any rights or warrants referred to in paragraph
(2) of this Section and any dividend or distribution not prohibited by Section
1007 hereof), the conversion price of such Debt Security shall be adjusted so
that the same shall equal the price determined by multiplying the conversion
price in effect immediately prior to the close of business on the date fixed for
the determination of stockholders entitled to receive such distribution by a
fraction of which the
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numerator shall be the current market price per share (determined as provided in
paragraph (6) of this Section) of the Common Stock on the date fixed for such
determination less the then fair market value (as determined by the Board of
Directors, whose determination shall be conclusive and described in a Board
Resolution filed with the Trustee) of the portion of the assets or evidences of
indebtedness so distributed applicable to one share of Common Stock and the
denominator shall be such current market price per share of the Common Stock,
such adjustment to become effective immediately prior to the opening of business
on the day following the date fixed for the determination of stockholders
entitled to receive such distribution.
(5) The reclassification (including any reclassification upon a
consolidation or merger in which the Company is the continuing corporation) of
Common Stock into securities including other than Common Stock shall be deemed
to involve (a) a distribution of such securities other than Common Stock to all
holders of Common Stock (and the effective date of such reclassification shall
be deemed to be "the date fixed for the determination of stockholders entitled
to receive such distribution" and "the date fixed for such determination" within
the meaning of paragraph (4) of this Section), and (b) a subdivision or
combination, as the case may be, of the number of shares of Common Stock
outstanding immediately prior to such reclassification into the number of shares
of Common Stock outstanding immediately thereafter (and the effective date of
such reclassification shall be deemed to be "the day upon which such subdivision
becomes effective" or "the day upon which such combination becomes effective",
as the case may be, and "the day upon which such subdivision or combination
becomes effective" within the meaning of paragraph (3) of this Section).
(6) For the purpose of any computation under paragraphs (2) and (4) of
this Section, the current market price per share of Common Stock on any date
shall be deemed to be the average of the daily closing prices for the 15
consecutive Business Days selected by the Company commencing not less than 20
nor more than 30 Business Days before the day in question. The closing price
for each day shall be determined in the manner set forth in Section 1303.
(7) The Company may from time to time reduce, in addition to those
required by paragraphs (1), (2), (3) and (4) of this Section, the conversion
price of Debt Securities of any series by any amount for any period if the
period is at least 20 days and if the reduction is irrevocable during the
period.
(8) Notwithstanding the provisions of this Article, the conversion
price per share shall not be reduced
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to less than the par value thereof as a result of any adjustment made hereunder.
(9) No adjustment in the conversion price shall be required unless
such adjustment would require an increase or decrease of at least 1% in such
price; provided, however, that any adjustment which by reason of this paragraph
-------- -------
(9) is not required to be made shall be carried forward and taken into account
in any subsequent adjustment. All calculations under this Article Thirteen
shall be made to the nearest cent or the nearest one-hundredth of a share, as
the case may be.
SECTION 1305. Notice of Adjustments of Conversion Price.
-----------------------------------------
Whenever the conversion price of any Debt Security is adjusted as
herein provided:
(a) the Company shall compute the adjusted conversion price in
accordance with Section 1304 and shall prepare an Officers' Certificate
setting forth the adjusted conversion price and showing in reasonable
detail the facts upon which such adjustment is based, and such certificate
shall forthwith be filed at each office or agency maintained for the
purpose of conversion of Debt Securities.
(b) a notice stating that the conversion price has been adjusted and
setting forth the adjusted conversion price shall be mailed by the Company
to the Trustee and the Holders of Debt Securities for which the conversion
price has been adjusted as herein provided.
SECTION 1306. Notice of Certain Corporate Action.
----------------------------------
In case:
(a) the Company shall declare a dividend (or any other distribution)
on its Common Stock payable otherwise than in cash out of its consolidated
earnings or retained earnings; or
(b) the Company shall authorize the granting to all the holders of its
Common Stock of rights or warrants to subscribe for or purchase any shares
of capital stock of any class or of any other rights (other than a dividend
or distribution payable in cash out of the consolidated earnings or
retained earnings of the Company); or
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(c) of any reclassification of the Common Stock of the Company (other
than a subdivision or combination of its outstanding shares of Common
Stock); or
(d) of the voluntary or involuntary dissolution liquidation or winding
up of the Company;
then the Company shall cause to be filed at each office or agency maintained for
the purpose of conversion of Debt Securities, and shall cause to be mailed to
the Holders of Debt Securities entitled to the conversion privilege as herein
provided, at least 20 days (or 10 days in any case specified in clause (a) or
(b) above) prior to the applicable record date hereinafter specified, a notice
stating (x) the date on which a record is to be taken for the purpose of such
dividend, distribution, rights or warrants, or, if a record is not to be taken,
the date as of which the holders of Common Stock of record to be entitled to
such dividend, distribution, rights or warrants are to be determined, or (y) the
date on which such reclassification, dissolution, liquidation or winding up is
expected to become effective, and the date as of which it is expected that
holders of Common Stock of record shall be entitled to exchange their shares of
Common Stock for securities, cash or other property deliverable upon such
reclassification, dissolution, liquidation or winding up.
SECTION 1307. Taxes on Conversions.
--------------------
The Company will pay any and all taxes that may be payable in respect
of the issue or delivery of shares of Common Stock on conversion of Debt
Securities pursuant hereto. The Company shall not, however, be required to pay
any tax which may be payable in respect of any transfer involved in the issue
and delivery of shares of Common Stock in a name other than that of the Holder
of the Debt Security or Debt Securities to be converted, and no such issue or
delivery shall be made unless and until the person requesting such issue has
paid to the Company the amount of any such tax, or has established to the
satisfaction of the Company that such tax has been paid.
ARTICLE FOURTEEN
RESTRICTIONS ON TRANSFER
SECTION 1401. Restrictions on Transfer.
------------------------
Any transfer of Debt Securities that, if effective, would result in
any Person becoming the Beneficial Owner of more than 9.9% of the outstanding
stock of the Company shall be deemed void ab initio, and the intended transferee
---------
shall be deemed never to have had an
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interest therein. The Trustee shall have no duty, responsibility or liability
in connection with the observation or enforcement of the aforementioned
restriction on transfer or the consequences of any breach or violation of such
restriction or the correction of any such breach or violation.
* * * * * *
This instrument may be executed in any number of counterparts, each of
which so executed shall be deemed to be an original, but all such counterparts
shall together constitute but one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the day and year first above written.
NATIONWIDE HEALTH PROPERTIES, INC.
By ___________________________
R. Bruce Andrews
President and Chief
Executive Officer
Trustee,
THE BANK OF NEW YORK
By ___________________________
Name:
Title:
S-1
<PAGE>
EXHIBIT 4.3
[FORM OF DEPOSIT AGREEMENT]
================================================================================
NATIONWIDE HEALTH PROPERTIES, INC.,
______________________________, As Depositary
AND
THE HOLDERS FROM TIME TO TIME OF
THE DEPOSITARY RECEIPTS DESCRIBED HEREIN
-----------------
Deposit Agreement
-----------------
Dated as of __________, 199__
================================================================================
<PAGE>
TABLE OF CONTENTS
_________________
<TABLE>
<CAPTION>
Page
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<S> <C>
PARTIES................................................................ 1
RECITALS............................................................... 1
ARTICLE I
Definitions.......................... 1
-----------
Articles Supplementary............................................ 1
Common Stock...................................................... 1
Company........................................................... 1
Deposit Agreement................................................. 1
Depositary........................................................ 1
Depositary Shares................................................. 1
Depositary's Agent................................................ 2
Depositary's Office............................................... 2
Receipt........................................................... 2
Record Holder..................................................... 2
Stock............................................................. 2
ARTICLE II
Form of Receipts, Deposit of Stock, Execution and Delivery,
Transfer, Surrender and Redemption of Receipts........ 2
SECTION 2.01. Form and Transfer of Receipts...................... 2
SECTION 2.02. Deposit of Stock; Execution and Delivery
of Receipts in Respect Thereof..................... 3
SECTION 2.03. Redemption of Stock................................ 4
SECTION 2.04. Conversion of Stock into Common Stock.............. 6
SECTION 2.05. Registration of Transfer of Receipts............... 6
SECTION 2.06. Split-ups and Combinations of Receipts;
Surrender of Receipts and Withdrawal of
Stock.............................................. 7
SECTION 2.07. Limitations on Execution and Delivery,
Transfer, Surrender and Exchange of
Receipts........................................... 8
SECTION 2.08. Lost Receipts, etc................................. 8
SECTION 2.09. Cancellation and Destruction of
Surrendered Receipts............................... 9
ARTICLE III
Certain Obligations of the Holders
of Receipts and the Company.................. 9
SECTION 3.01. Filing Proofs, Certificates and Other
Information........................................ 9
SECTION 3.02. Payment of Taxes or Other Governmental
Charges............................................ 9
SECTION 3.03. Warranty as to Stock............................... 9
SECTION 3.04. Covenants and Warranties as to Common
</TABLE>
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Stock.............................................. 10
ARTICLE IV
The Deposited Securities; Notices............... 10
SECTION 4.01. Cash Distributions................................. 10
SECTION 4.02. Distributions Other than Cash...................... 10
SECTION 4.03. Subscription Rights, Preferences or
Privileges......................................... 11
SECTION 4.04. Notice of Dividends, etc.; Fixing of
Record Date for Holders of Receipts................ 12
SECTION 4.05. Voting Rights...................................... 12
SECTION 4.06. Changes Affecting Deposited Securities
and Reclassifications, Recapitalizations,
etc................................................ 13
SECTION 4.07. Delivery of Reports................................ 13
SECTION 4.08. List of Receipt Holders............................ 14
ARTICLE V
The Depositary, the Depositary's Agents
and the Company........................ 14
SECTION 5.01. Maintenance of Offices, Agencies and
Transfer Books by the Depositary................... 14
SECTION 5.02. Prevention of or Delay in Performance by
the Depositary, the Depositary's Agents
or the Company..................................... 14
SECTION 5.03. Obligations of the Depositary, the
Depositary's Agents and the Company................ 15
SECTION 5.04. Resignation and Removal of the
Depositary; Appointment of Successor
Depositary......................................... 16
SECTION 5.05. Corporate Notices and Reports...................... 17
SECTION 5.06. Indemnification by the Company..................... 17
SECTION 5.07. Charges and Expenses............................... 17
ARTICLE VI
Amendment and Termination................... 18
SECTION 6.01. Amendment.......................................... 18
SECTION 6.02. Termination........................................ 18
ARTICLE VII
Miscellaneous......................... 19
SECTION 7.01. Counterparts....................................... 19
SECTION 7.02. Exclusive Benefit of Parties....................... 19
SECTION 7.03. Invalidity of Provisions........................... 19
</TABLE>
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SECTION 7.04. Notices............................................ 19
SECTION 7.05. Depositary's Agents................................ 20
SECTION 7.06. Holders of Receipts Are Parties.................... 20
SECTION 7.07. Governing Law...................................... 20
SECTION 7.08. Inspection of Deposit Agreement.................... 20
SECTION 7.09. Headings........................................... 20
TESTIMONIUM............................................................ 21
SIGNATURES............................................................. 21
EXHIBIT A: Form of Depositary Receipt
</TABLE>
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<PAGE>
DEPOSIT AGREEMENT dated as of
__________, 199__, among
NATIONWIDE HEALTH PROPERTIES, INC.,
a Maryland corporation,
_________________________,
a __________ ________________,
and the holders from time to time of
the Receipts described herein.
WHEREAS it is desired to provide, as hereinafter set forth in this
Deposit Agreement, for the deposit of shares of _____% __________ Preferred
Stock, $1.00 par value, of NATIONWIDE HEALTH PROPERTIES, INC. with the
Depositary (as hereinafter defined) for the purposes set forth in this Deposit
Agreement and for the issuance hereunder of Receipts (as hereinafter defined)
evidencing Depositary Shares (as hereinafter defined) so deposited;
NOW, THEREFORE, in consideration of the premises, the parties hereto
agree as follows:
ARTICLE I
Definitions
-----------
The following definitions shall for all purposes, unless otherwise
indicated, apply to the respective terms used in this Deposit Agreement and the
Receipts:
"Articles Supplementary" shall mean the Board of Directors' resolution
and/or the articles supplementary filed with the Maryland State Department of
Assessments and Taxation establishing the Stock as a series of preferred stock
of the Company.
"Common Stock" shall mean the shares of the Company's Common Stock,
$.10 par value.
"Company" shall mean Nationwide Health Properties, Inc., a Maryland
corporation, and its successors.
"Deposit Agreement" shall mean this Deposit Agreement, as amended or
supplemented from time to time.
"Depositary" shall mean ____________________, and any successor as
Depositary and registrar to register ownership and transfers of Depositary
Shares hereunder as herein provided.
1
<PAGE>
"Depositary Shares" shall mean Depositary Shares, each representing a
__________ interest in a share of Stock and evidenced by a Receipt.
"Depositary's Agent" shall mean an agent appointed by the Depositary
pursuant to Section 7.05.
"Depositary's Office" shall mean the principal office of the
Depositary in __________, _______________, at which at any particular time its
depositary receipt business shall be administered.
"Receipt" shall mean one of the depositary receipts issued hereunder,
whether in definitive or temporary form.
"Record Holder" as applied to a Receipt shall mean the person in whose
name a Receipt is registered on the books of the Depositary maintained for such
purpose.
"Stock" shall mean shares of the Company's _____% __________ Preferred
Stock, $1.00 par value.
ARTICLE II
Form of Receipts, Deposit of Stock, Execution and Delivery,
-----------------------------------------------------------
Transfer, Surrender and Redemption of Receipts
----------------------------------------------
SECTION 2.01. Form and Transfer of Receipts. Definitive Receipts
-----------------------------
shall be engraved or printed or lithographed and shall be substantially in the
form set forth in Exhibit A annexed to this Deposit Agreement, with appropriate
insertions, modifications and omissions, as hereinafter provided. Pending the
preparation of definitive Receipts, the Depositary, upon the written order of
the Company delivered in compliance with Section 2.02, shall execute and deliver
temporary Receipts which are printed, lithographed, typewritten, mimeographed or
otherwise substantially of the tenor of the definitive Receipts in lieu of which
they are issued and with such appropriate insertions, omissions, substitutions
and other variations as the persons executing such Receipts may determine, as
evidenced by their execution of such Receipts. If temporary Receipts are
issued, the Company and the Depositary will cause definitive Receipts to be
prepared without unreasonable delay. After the preparation of definitive
Receipts, the temporary Receipts shall be exchangeable for definitive Receipts
upon surrender of the temporary Receipts at an office described in the third
paragraph of Section 2.02, without charge to the holder. Upon surrender for
cancellation of any one or more temporary Receipts, the Depositary shall execute
and deliver in exchange therefor definitive Receipts representing the same
number of Depositary Shares as represented by the surrendered temporary Receipt
or Receipts. Such exchange shall be made at the Company's expense and without
any charge therefor.
2
<PAGE>
Until so exchanged, the temporary Receipts shall in all respects be entitled to
the same benefits under this Deposit Agreement, and with respect to the Stock,
as definitive Receipts.
Receipts shall be executed by the Depositary by the manual signature
of a duly authorized officer of the Depositary. No Receipt shall be entitled to
any benefits under this Deposit Agreement or be valid or obligatory for any
purpose unless it shall have been executed manually by a duly authorized officer
of the Depositary. The Depositary shall record on its books each Receipt so
signed and delivered as hereinafter provided.
Receipts shall be in denominations of any number of whole Depositary
Shares.
Receipts may be endorsed with or have incorporated in the text thereof
such legends or recitals or changes not inconsistent with the provisions of this
Deposit Agreement as may be required by the Company or the Depositary or
required to comply with any applicable law or any regulation thereunder or with
the rules and regulations of any securities exchange upon which the Stock, the
Depositary Shares or the Receipts may be listed or to conform with any usage
with respect thereto, or to indicate any special limitations or restrictions to
which any particular Receipts are subject.
Title to Depositary Shares evidenced by a Receipt which is properly
endorsed, or accompanied by a properly executed instrument of transfer, shall be
transferable by delivery with the same effect as in the case of a negotiable
instrument; provided, however, that until transfer of a Receipt shall be
-----------------
registered on the books of the Depositary as provided in Section 2.05, the
Depositary may, notwithstanding any notice to the contrary, treat the record
holder thereof at such time as the absolute owner thereof for the purpose of
determining the person entitled to receive distributions of dividends or other
distributions, withdraw any Stock underlying the Depositary Shares, exercise any
conversion rights or to receive any notice provided for in this Deposit
Agreement and for all other purposes.
SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in
-------------------------------------------------------
Respect Thereof. Subject to the terms and conditions of this Deposit Agreement,
- ---------------
the Company may from time to time deposit shares of Stock under this Deposit
Agreement by delivery to the Depositary of a certificate or certificates for the
Stock to be deposited, properly endorsed or accompanied, if required by the
Depositary, by a duly executed instrument of transfer or endorsement, in form
satisfactory to the Depositary, together with all such certifications as may be
required by the Depositary in accordance with the provisions of this Deposit
Agreement, and together with a written order of the Company directing the
Depositary to execute and deliver to, or upon the
3
<PAGE>
written order of, the person or persons stated in such order a Receipt or
Receipts for the number of Depositary Shares relating to such deposited Stock.
Deposited Stock shall be held by the Depositary at the Depositary's
Office or at such other place or places as the Depositary shall determine.
Upon receipt by the Depositary of a certificate or certificates for
Stock deposited in accordance with the provisions of this Section, together with
the other documents required as above specified, and upon recordation of the
Stock so deposited on the books of the Company in the name of the Depositary or
its nominee, the Depositary, subject to the terms and conditions of this Deposit
Agreement, shall execute and deliver, to or upon the order of the person or
persons named in the written order delivered to the Depositary referred to in
the first paragraph of this Section, a Receipt or Receipts for the number of
Depositary Shares relating to the Stock so deposited and registered in such name
or names as may be requested by such person or persons. The Depositary shall
execute and deliver such Receipt or Receipts at the Depositary's Office or such
other offices, if any, as the Depositary may designate. Delivery at other
offices shall be at the risk and expense of the person requesting such delivery.
Other than in the case of splits, combinations or other
reclassifications affecting the Stock, or in the case of dividends or other
distributions of Stock, if any, there shall be deposited hereunder not more than
__________ shares of Stock.
SECTION 2.03. Redemption of Stock. Whenever the Company shall elect
-------------------
to redeem shares of Stock in accordance with the provisions of the Articles
Supplementary, it shall (unless otherwise agreed in writing with the Depositary)
mail notice to the Depositary of such proposed redemption, by first class mail,
postage prepaid not less than 30 nor more than 60 days prior to the date fixed
for redemption of Stock in accordance with the Articles Supplementary. On the
date of such redemption, provided that the Company shall then have paid in full
to the Depositary the redemption price of the Stock to be redeemed, as set forth
in the Articles Supplementary, plus any accrued and unpaid dividends thereon to
and including the Redemption Date (as defined below), the Depositary shall
redeem the Depositary Shares relating to such Stock. The Depositary shall mail
notice of such redemption and the proposed simultaneous redemption of the number
of Depositary Shares relating to the Stock to be redeemed, by first-class mail,
postage prepaid, not less than 30 and not more than 60 days prior to the date
fixed for redemption of such Stock and Depositary Shares (the "Redemption
Date"), to the record holders of the Receipts evidencing the Depositary Shares
to be so redeemed, at the addresses of such holders as they appear on the
records of the Depositary; but neither failure to mail any such
4
<PAGE>
notice to one or more such holders nor any defect in any notice to one or more
such holders shall affect the sufficiency of the proceedings for redemption as
to other holders. Each such notice shall state: (i) the Redemption Date; (ii)
the number of Depositary Shares to be redeemed and, if less than all the
Depositary Shares held by any such holder are to be redeemed, the number of such
Depositary Shares held by such holder to be so redeemed; (iii) the redemption
price (which shall include any accrued and unpaid dividends to and including the
Redemption Date); (iv) the place or places where Receipts evidencing Depositary
Shares are to be surrendered for payment of the redemption price; (v) that
dividends in respect of the Stock underlying the Depositary Shares to be
redeemed will cease to accumulate after the close of business on such Redemption
Date; and (vi) that the right to convert Depositary Shares into shares of Common
Stock, if applicable, will expire after the close of business on the _____ day
preceding the Redemption Date; the then-effective conversion price and the place
or places where Receipts evidencing such Depositary Shares are to be surrendered
for conversion. In case less than all the outstanding Depositary Shares are to
be redeemed, the Depositary Shares to be so redeemed shall be selected by lot or
pro rata (subject to rounding to avoid fractions of Depositary Shares) as may be
determined by the Depositary to be equitable.
Notice having been mailed by the Depositary as aforesaid (unless the
Company shall have failed to redeem the shares of Stock to be redeemed by it as
set forth in the Company's notice provided for in the preceding paragraph), (i)
after the close of business on the _____ day preceding the Redemption Date, all
conversion rights in respect of the Depositary Shares called for redemption on
such Redemption Date will terminate and (ii) from and after the Redemption Date
all dividends in respect of the Depositary Shares so called for redemption shall
cease to accumulate, the Depositary Shares being redeemed from such proceeds
shall be deemed no longer to be outstanding, all remaining rights of the holders
of Receipts evidencing such Depositary Shares (except the right to receive the
redemption price without interest) shall, to the extent of such Depositary
Shares, cease and terminate and, upon surrender in accordance with such notice
of the Receipts evidencing any such Depositary Shares (properly endorsed or
assigned for transfer, if the Depositary shall so require), such Depositary
Shares shall be redeemed by the Depositary at a redemption price per Depositary
Share equal to __________ of the redemption price per share paid in respect of
the shares of Stock plus all money and other property, if any, paid with respect
to such Depositary Shares, including all amounts paid by the Company in respect
of dividends which on the Redemption Date have accumulated on the shares of
Stock to be so redeemed and have not theretofore been paid.
5
<PAGE>
If less than all the Depositary Shares evidenced by a Receipt are
called for redemption, the Depositary will deliver to the holder of such Receipt
upon its surrender to the Depositary, together with the redemption payment, a
new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and
not called for redemption.
SECTION 2.04. Conversion of Stock into Common Stock. The Company
-------------------------------------
hereby agrees to accept the delivery of Receipts for purposes of effecting
conversions of the Stock utilizing the same procedures as those provided for
delivery of certificates for the Stock to effect such conversions in accordance
with the terms and conditions of the Stock as provided in the Articles
Supplementary. Any whole number of Depositary Shares (whether or not evenly
divisible by ____) represented by a Receipt may be surrendered for conversion.
If the Depositary Shares represented by a Receipt are to be converted in part
only, a new Receipt or Receipts will be issued by the Depositary for the
Depositary Shares not to be converted. No fractional shares of Common Stock
will be issued upon conversion, and if such conversion will result in a
fractional share being issued, an amount will be paid in cash by the Company
equal to the value of the fractional interest based upon the closing price of
the Common Stock on the last business day prior to the conversion. For this
purpose, a holder of a Receipt or Receipts must surrender such Receipt or
Receipts to the Company, together with a duly completed and executed Notice of
Conversion in the form included in the Receipt. In all cases the foregoing
shall be conditioned upon compliance in full by the holders with the applicable
terms and conditions of the Stock as provided in the Articles Supplementary and
of this Deposit Agreement. The Company and the Depositary will thereafter
effect the cancellation of each Receipt surrendered for such conversion and of
the related Stock so converted. In the event that the conversion of Depositary
Shares results in issuance of a fraction of a share of Stock, the Depositary
will make appropriate adjustment in its records to reflect such issuance and, if
appropriate, the combination of any fractions of shares into one or more whole
shares of Stock.
Upon conversion no adjustments will be made for accrued dividends and,
therefore, Depositary Shares surrendered for conversion after the record date
next preceding a dividend payment date for the Stock and prior to such dividend
payment date must be accompanied by payment of an amount equal to the applicable
fraction of the dividend thereon which is to be paid on such dividend payment
date (unless the Depositary Shares surrendered for conversion have been called
for redemption prior to such dividend payment date). No adjustment of the
conversion price will be required to be made in any case until cumulative
adjustment amounts to 1% or more of the conversion price.
SECTION 2.05. Registration of Transfer of Receipts. Subject to the
------------------------------------
terms and conditions of this Deposit Agreement,
6
<PAGE>
the Depositary shall register on its books from time to time transfers of
Receipts upon any surrender thereof by the holder in person or by duly
authorized attorney, properly endorsed or accompanied by a properly executed
instrument of transfer. Thereupon the Depositary shall execute a new Receipt or
Receipts evidencing the same aggregate number of Depositary Shares as those
evidenced by the Receipt or Receipts surrendered and deliver such new Receipt or
Receipts to or upon the order of the person entitled thereto.
SECTION 2.06. Split-ups and Combinations of Receipts; Surrender of
----------------------------------------------------
Receipts and Withdrawal of Stock. Upon surrender of a Receipt or Receipts at
- --------------------------------
the Depositary's Office or at such other offices as it may designate for the
purpose of effecting a split-up or combination of such Receipt or Receipts, and
subject to the terms and conditions of this Deposit Agreement, the Depositary
shall execute and deliver a new Receipt or Receipts in the denominations
requested, evidencing the aggregate number of Depositary Shares evidenced by the
Receipt or Receipts surrendered.
Any holder of a Receipt or Receipts evidencing at least __________
Depositary Shares may withdraw the number of whole shares of Stock underlying
such Depositary Shares and all money and other property, if any, relating
thereto by surrendering Receipts evidencing such Depositary Shares at the
Depositary's Office or at such other offices as the Depositary may designate for
such withdrawals. Thereafter, without unreasonable delay, the Depositary shall
deliver to such holder, or to the person or persons designated by such holder as
hereinafter provided, the number of whole shares of Stock and all money and
other property, if any, relating to the Depositary Shares evidenced by the
Receipts so surrendered for withdrawal, but holders of such whole shares of
Stock will not thereafter be entitled to deposit such Stock hereunder or to
receive Receipts evidencing Depositary Shares therefor. If a Receipt delivered
by a holder to the Depositary in connection with such withdrawal shall evidence
a number of Depositary Shares relating to other than a number of whole shares of
Stock, the Depositary shall at the same time, in addition to such number of
whole shares of Stock and such money and other property, if any, to be so
withdrawn, deliver to such holder, or (subject to Section 3.02) upon his order,
a new Receipt evidencing such excess number of Depositary Shares. Delivery of
the Stock and money and other property being withdrawn may be made by delivery
of such certificates, documents of title and other instruments as the Depositary
may deem appropriate.
HOLDERS ACKNOWLEDGE THAT THERE WILL BE NO MARKET FOR THE UNDERLYING
STOCK AND THAT UPON WITHDRAWAL OF THE STOCK, HOLDERS THEREOF WILL NOT BE
ENTITLED THEREAFTER TO DEPOSIT SUCH STOCK UNDER THIS DEPOSIT AGREEMENT.
7
<PAGE>
If the Stock and the money and other property being withdrawn are to
be delivered to a person or persons other than the record holder of the Receipts
being surrendered for withdrawal of Stock, such holder shall execute and deliver
to the Depositary a written order so directing the Depositary, and the
Depositary may require that the Receipt or Receipts surrendered by such holder
for withdrawal of such shares of Stock be properly endorsed in blank or
accompanied by a properly executed instrument of transfer.
Delivery of the Stock and the money and other property, if any,
underlying the Depositary Shares evidenced by the Receipts surrendered for
withdrawal shall be made by the Depositary at the Depositary's Office, except
that, at the request, risk and expense of the holder surrendering such Receipts
and for the account of such holder, such delivery may be made at such other
place as may be designated by such holder.
SECTION 2.07. Limitations on Execution and Delivery, Transfer,
------------------------------------------------
Surrender and Exchange of Receipts. As a condition precedent to the execution
- ----------------------------------
and delivery, registration of transfer, split-up, combination, surrender,
exchange or redemption of any Receipt, the withdrawal of any Stock underlying
the Depositary Shares or the exercise of any conversion rights, the Depositary,
any of the Depositary's Agents or the Company may require payment to it of a sum
sufficient for the payment (or, in the event that the Depositary or the Company
shall have made such payment, the reimbursement to it) of any charges or
expenses payable by the holder of a Receipt pursuant to Section 5.07, may
require the production of evidence satisfactory to it as to the identity and
genuineness of any signature and may also require compliance with such
regulations, if any, as the Depositary or the Company may establish consistent
with the provisions of this Deposit Agreement.
The exercise of any conversion rights or the withdrawal of any Stock
underlying the Depositary Shares may be suspended, the delivery of Receipts
against Stock may be suspended, the registration of transfer of Receipts may be
refused and the registration of transfer, surrender, exchange or redemption of
outstanding Receipts may be suspended (i) during any period when the register of
stockholders of the Company is closed or (ii) if any such action is deemed
necessary or advisable by the Depositary, any of the Depositary's Agents or the
Company at any time or from time to time because of any requirement of law or of
any government or governmental body or commission or under any provision of this
Deposit Agreement.
SECTION 2.08. Lost Receipts, etc. In case any Receipt shall be
------------------
mutilated, destroyed, lost or stolen, the Depositary in its discretion may
execute and deliver a Receipt of like form and tenor in exchange and
substitution for such mutilated Receipt, or in lieu of and in substitution for
such destroyed, lost or stolen
8
<PAGE>
Receipt, upon (i) the filing by the holder thereof with the Depositary of
evidence satisfactory to the Depositary of such destruction or loss or theft of
such Receipt, of the authenticity thereof and of his or her ownership thereof
and (ii) the furnishing of the Depositary with reasonable indemnification
satisfactory to it.
SECTION 2.09. Cancellation and Destruction of Surrendered Receipts.
----------------------------------------------------
All Receipts surrendered to the Depositary or any Depositary's Agent shall be
canceled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy all Receipts so canceled.
ARTICLE III
Certain Obligations of the Holders
----------------------------------
of Receipts and the Company
---------------------------
SECTION 3.01. Filing Proofs, Certificates and Other Information. Any
-------------------------------------------------
holder of a Receipt may be required from time to time to file such proof of
residence, or other matters or other information, to execute such certificates
and to make such representations and warranties as the Depositary or the Company
may reasonably deem necessary or proper. The Depositary or the Company may
withhold the delivery, or delay the registration of transfer, redemption or
exchange, of any Receipt, the exercise of any conversion rights, the withdrawal
of any Stock underlying the Depositary Shares or the distribution of any
dividend or other distribution or the sale of any rights or of the proceeds
thereof until such proof or other information is filed or such certificates are
executed or such representations and warranties are made.
SECTION 3.02. Payment of Taxes or Other Governmental Charges.
----------------------------------------------
Holders of Receipts shall be obligated to make payments to the Depositary of
certain taxes, charges and expenses, as provided in Section 5.07. Registration
of transfer of any Receipt, the exercise of any conversion rights, any
withdrawal of Stock and delivery of all money or other property, if any,
represented by the Depositary Shares evidenced by such Receipt may be refused
until any such payment due is made, and any dividends, interest payments or
other distributions may be withheld or all or any part of the Stock or other
property relating to the Depositary Shares evidenced by such Receipt and not
theretofore sold may be sold for the account of the holder thereof (after
attempting by reasonable means to notify such holder prior to such sale), and
such dividends, interest payments or other distributions or the proceeds of any
such sale may be applied to any payment of such taxes, charges or expenses, the
holder of such Receipt remaining liable for any deficiency.
9
<PAGE>
SECTION 3.03. Warranty as to Stock. The Company hereby represents
--------------------
and warrants that the Stock, when issued, will be validly issued, fully paid and
nonassessable. Such representation and warranty shall survive the deposit of
the Stock and the issuance of Receipts.
SECTION 3.04. Covenants and Warranties as to Common Stock. The
-------------------------------------------
Company covenants that it will keep reserved or otherwise available a sufficient
number of authorized and unissued shares of Common Stock to meet conversion
requirements in respect of the Depositary Shares and that it will give written
notice to the Depositary of any adjustments in the conversion price made
pursuant to the Articles Supplementary. The Company represents and warrants
that the Common Stock issued upon conversion of the Depositary Shares will be
validly issued, fully paid and non-assessable.
ARTICLE IV
The Deposited Securities; Notices
---------------------------------
SECTION 4.01. Cash Distributions. Whenever the Depositary shall
------------------
receive any cash dividend or other cash distribution on the Stock, the
Depositary shall, subject to Sections 3.01 and 3.02, distribute to the record
holders of Receipts on the record date fixed pursuant to Section 4.04 such
amounts of such dividend or distribution as are, as nearly as practicable, in
proportion to the respective numbers of Depositary Shares evidenced by the
Receipts held by such holders; provided, however, that in case the Company or
-------- -------
the Depositary shall be required to withhold and shall withhold from any cash
dividend or other cash distribution in respect of the Stock an amount on account
of taxes and governmental charges, the amount made available for distribution or
distributed in respect of Depositary Shares shall be reduced accordingly. The
Depositary shall distribute or make available for distribution, as the case may
be, only such amount, however, as can be distributed without attributing to any
holder of Receipts a fraction of one cent, and any balance not so distributable
shall be held by the Depositary (without liability for interest thereon) and
shall be added to and be treated as part of the next sum received by the
Depositary for distribution to record holders of Receipts then outstanding.
SECTION 4.02. Distributions Other than Cash. Whenever the
-----------------------------
Depositary shall receive any distribution other than cash on the Stock, the
Depositary shall, subject to Sections 3.01 and 3.02, distribute to record
holders of Receipts on the record date fixed pursuant to Section 4.04 such
amounts of the securities or property received by it as are, as nearly as
practicable, in proportion to the respective numbers of Depositary Shares
evidenced by the Receipts held by such holders, in any manner that the
Depositary may deem equitable and
10
<PAGE>
practicable for accomplishing such distribution. If in the opinion of the
Depositary such distribution cannot be made proportionately among such record
holders, or if for any other reason (including any requirement that the Company
or the Depositary withhold an amount on account of taxes and governmental
charges) the Depositary deems, after consultation with the Company, such
distribution not to be feasible, the Depositary may, with the approval of the
Company, adopt such method as it deems equitable and practicable for the purpose
of effecting such distribution, including the sale (at public or private sale)
of the securities or property thus received, or any part thereof, at such place
or places and upon such terms as it may deem proper. The net proceeds of any
such sale shall, subject to Sections 3.01 and 3.02, be distributed or made
available for distribution, as the case may be, by the Depositary to record
holders of Receipts as provided by Section 4.01 in the case of a distribution
received in cash.
SECTION 4.03. Subscription Rights, Preferences or Privileges. If the
----------------------------------------------
Company shall at any time offer or cause to be offered to the persons in whose
names Stock is recorded on the books of the Company any rights, preferences or
privileges to subscribe for or to purchase any securities or any rights,
preferences or privileges of any other nature, such rights, preferences or
privileges shall in each such instance be made available by the Depositary to
the record holders of Receipts in such manner as the Depositary may determine,
either by the issue to such record holders of warrants representing such rights,
preferences or privileges or by such other method as may be approved by the
Depositary in its discretion with the approval of the Company; provided,
--------
however, that (i) if at the time of issue or offer of any such rights,
- -------
preferences or privileges the Depositary determines that it is not lawful or
(after consultation with the Company) not feasible to make such rights,
preferences or privileges available to holders of Receipts by the issue of
warrants or otherwise, or (ii) if and to the extent so instructed by holders of
Receipts who do not desire to exercise such rights, preferences or privileges,
then the Depositary, in its discretion (with the approval of the Company, in any
case where the Depositary has determined that it is not feasible to make such
rights, preferences or privileges available), may, if applicable laws or the
terms of such rights, preferences or privileges permit such transfer, sell such
rights, preferences or privileges at public or private sale, at such place or
places and upon such terms as it may deem proper. The net proceeds of any such
sale shall, subject to Sections 3.01 and 3.02, be distributed by the Depositary
to the record holders of Receipts entitled thereto as provided by Section 4.01
in the case of a distribution received in cash.
If registration under the Securities Act of 1933, as amended (the
"Act"), of the securities to which any rights, preferences or privileges relate
is required in order for holders
11
<PAGE>
of Receipts to be offered or sold the securities to which such rights,
preferences or privileges relate, the Company agrees with the Depositary that
the Company will notify the Depositary and file promptly a registration
statement pursuant to such Act with respect to such rights, preferences or
privileges and securities and use its best efforts and take all steps available
to it to cause such registration statement to become effective sufficiently in
advance of the expiration of such rights, preferences or privileges to enable
such holders to exercise such rights, preferences or privileges. In no event
shall the Depositary make available to the holders of Receipts any right,
preference or privilege to subscribe for or to purchase any securities unless
and until such a registration statement shall have become effective, or unless
the offering and sale of such securities to such holders are exempt from
registration under the provisions of the Act.
If any other action under the laws of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to holders
of Receipts, the Company agrees with the Depositary that the Company will notify
the Depositary and use its best efforts to take such action or obtain such
authorization, consent or permit sufficiently in advance of the expiration of
such rights, preferences or privileges to enable such holders to exercise such
rights, preferences or privileges.
SECTION 4.04. Notice of Dividends, etc.; Fixing of Record Date for
----------------------------------------------------
Holders of Receipts. Whenever any cash dividend or other cash distribution
- -------------------
shall become payable or any distribution other than cash shall be made, or if
rights, preferences or privileges shall at any time be offered, with respect to
the Stock, or whenever the Depositary shall receive notice of any meeting or
action to be taken by written consent at or as to which holders of Stock are
entitled to vote or consent, or of which holders of Stock are entitled to
notice, the Depositary shall in each such instance fix a record date (which
shall be the same date as the record date fixed by the Company with respect to
the Stock) for the determination of the holders of Receipts who shall be
entitled to receive a distribution in respect of such dividend, distribution,
rights, preferences or privileges or the net proceeds of the sale thereof, or to
give instructions for the exercise of any rights to vote or consent at any such
meeting or with respect to any such action, or who shall be entitled to receive
notice of such meeting or such action.
SECTION 4.05. Voting Rights. Upon receipt of notice of any meeting
-------------
or action to be taken by written consent at or as to which the holders of the
Stock are entitled to vote or consent, the Depositary shall, as soon as
practicable thereafter, mail to the record holders of Receipts a notice which
shall contain (i) such information as is contained in such notice of
12
<PAGE>
meeting or action and (ii) a statement informing holders of Receipts that they
may instruct the Depositary as to the exercise of the voting rights or the
giving or refusal of consent, as the case may be, pertaining to the amount of
Stock underlying their respective Depositary Shares and a brief statement as to
the manner in which such instructions may be given. Upon the written request of
the holders of Receipts on the record date (which shall be the same date as the
record date for the Stock), the Depositary shall endeavor insofar as practicable
to vote or cause to be voted, or give or withhold consent with respect to, in
accordance with the instructions set forth in such requests, the maximum number
of whole shares of Stock underlying the Depositary Shares evidenced by all
Receipts as to which any particular voting or consent instructions are received.
The Company hereby agrees to take all action which may be deemed necessary by
the Depositary in order to enable the Depositary to vote such Stock or cause
such Stock to be voted or give or withhold consent with respect to such Stock.
In the absence of specific instructions from the holder of a Receipt, the
Depositary will abstain from voting, or giving consents (but, at its discretion,
not from appearing at any meeting with respect to such Stock unless directed to
the contrary by the holders of a majority of the Receipts) to the extent of the
Stock underlying the Depositary Shares evidenced by such Receipt. The Company
also agrees that it will at all times comply with the proxy rules of the
Securities Exchange Act of 1934, as amended.
SECTION 4.06. Changes Affecting Deposited Securities and
------------------------------------------
Reclassifications, Recapitalizations, etc. Upon any change in par or stated
- -----------------------------------------
value, split-up, combination or any other reclassification of the Stock, or upon
any recapitalization, reorganization, merger, amalgamation or consolidation
affecting the Company or to which it is a party or sale of all or substantially
all the Company's assets, the Depositary may in its discretion, with the
approval of, and shall upon the instructions of, the Company, and (in either
case) in such manner as the Depositary may deem equitable, (i) make such
adjustments in (a) the fraction of an interest in one share of Stock underlying
one Depositary Share and (b) the ratio of the redemption price per Depositary
Share to the redemption price of a share of the Stock, in each case as may be
necessary fully to reflect the effects of such change in par or stated value,
split-up, combination or other reclassification of the Stock, or of such
recapitalization, reorganization, merger, amalgamation or consolidation or sale
and (ii) treat any securities which shall be received by the Depositary in
exchange for or upon conversion of or in respect of the Stock as new deposited
securities so received in exchange for or upon conversion of or in respect of
such Stock. In any such case the Depositary may in its discretion, with the
approval of the Company, execute and deliver additional Receipts, or may call
for the surrender of all outstanding Receipts to be exchanged for new Receipts
specifically describing such new deposited securities.
13
<PAGE>
SECTION 4.07. Delivery of Reports. The Depositary will forward to
-------------------
record holders of Receipts, at their respective addresses appearing in the
Depositary's books, all notices, reports and communications received from the
Company which are delivered to the Depositary and which the Company is required
to furnish to the holders of Stock or Receipts.
SECTION 4.08. List of Receipt Holders. Promptly upon request from
-----------------------
time to time by the Company, the Depositary shall furnish to it a list, as of a
recent date, of the names, addresses and holdings of Stock of all persons in
whose names Receipts are registered on the books of the Depositary.
ARTICLE V
The Depositary, the Depositary's Agents
---------------------------------------
and the Company
---------------
SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by
------------------------------------------------------
the Depositary. Upon execution of this Deposit Agreement, the Depositary shall
- --------------
maintain at the Depositary's Office, facilities for the execution and delivery,
registration and registration of transfer, surrender and exchange of Receipts,
and at the offices of the Depositary's Agents, if any, facilities for the
delivery, registration of transfer, surrender and exchange of Receipts, all in
accordance with the provisions of this Deposit Agreement.
The Depositary shall keep books at the Depositary's Office for the
registration and registration of transfer of Receipts, which books at all
reasonable times shall be open for inspection by the record holders of Receipts;
provided, that any such holder requesting to exercise such right shall certify
- --------
to the Depositary that such inspection shall be for a proper purpose reasonably
related to such person's interest as an owner of Depositary Shares evidenced by
the Receipts.
The Depositary may close such books, at any time or from time to time,
when deemed expedient by it in connection with the performance of its duties
hereunder.
If the Receipts or the Depositary Shares evidenced thereby or the
Stock represented by such Depositary Shares shall be listed on the New York
Stock Exchange or any other stock exchange, the Depositary will, at the request
of the Company, arrange such facilities for the delivery, registration,
registration of transfer, surrender, exchange, redemption or conversion of such
Receipts, such Depositary Shares or such Stock as applicable and as may be
required by law or applicable stock exchange regulation.
14
<PAGE>
SECTION 5.02. Prevention of or Delay in Performance by the
--------------------------------------------
Depositary, the Depositary's Agents or the Company. Neither the Depositary nor
- --------------------------------------------------
any Depositary's Agent nor the Company shall incur any liability to any holder
of any Receipt if by reason of any provision of any present or future law, or
regulation thereunder, of the United States of America or of any other
governmental authority or, in the case of the Depositary or any Depositary's
Agent, by reason of any provision, present or future, of the Company's Amended
and Restated Articles of Incorporation, as amended (including the Articles
Supplementary) or by reason of any act of God or war or other circumstance
beyond the control of the relevant party, the Depositary, any Depositary's Agent
or the Company shall be prevented or forbidden from doing or performing any act
or thing which the terms of this Deposit Agreement provide shall be done or
performed; nor shall the Depositary, any Depositary's Agent or the Company incur
any liability to any holder of a Receipt (i) by reason of any nonperformance or
delay, caused as aforesaid, in the performance of any act or thing which the
terms of this Deposit Agreement provide shall or may be done or performed, or
(ii) by reason of any exercise of, or failure to exercise, any discretion
provided for in this Deposit Agreement except, in case of any such exercise or
failure to exercise discretion not caused as aforesaid, if caused by the gross
negligence or willful misconduct of the party charged with such exercise or
failure to exercise.
SECTION 5.03. Obligations of the Depositary, the Depositary's Agents
------------------------------------------------------
and the Company. Neither the Depositary nor any Depositary's Agent nor the
- ---------------
Company assumes any obligation or shall be subject to any liability under this
Deposit Agreement to holders of Receipts other than for its gross negligence or
willful misconduct.
Neither the Depositary nor any Depositary's Agent nor the Company
shall be under any obligation to appear in, prosecute or defend any action, suit
or other proceeding in respect of the Stock, the Depositary Shares or the
Receipts which in its opinion may involve it in expense or liability unless
indemnity satisfactory to it against all expense and liability be furnished as
often as may be required.
Neither the Depositary nor any Depositary's Agent nor the Company
shall be liable for any action or any failure to act by it in reliance upon the
written advice of legal counsel or accountants, or information from any person
presenting Stock for deposit, any holder of a Receipt or any other person
believed by it in good faith to be competent to give such information. The
Depositary, any Depositary's Agent and the Company may each rely and shall each
be protected in acting upon any written notice, request, direction or other
document believed by it to be genuine and to have been signed or presented by
the proper party or parties.
15
<PAGE>
The Depositary shall not be responsible for any failure to carry out
any instruction to vote or give or withhold consent, with respect to any of the
shares of Stock or for the manner or effect of any such vote or consent, as long
as any such action or non-action is in good faith. The Depositary undertakes to
perform such duties and only such duties as are specifically set forth in this
Deposit Agreement, and no implied covenants or obligations shall be read into
this Deposit Agreement against the Depositary. The Depositary will indemnify
the Company against any liability which may arise out of acts performed or
omitted by the Depositary or its agents due to its or their gross negligence or
willful misconduct. The Depositary, the Depositary's Agents and the Company may
own and deal in any class of securities of the Company and its affiliates and in
Receipts. The Depositary may also act as transfer agent and registrar of any of
the securities of the Company and its affiliates.
SECTION 5.04. Resignation and Removal of the Depositary; Appointment
------------------------------------------------------
of Successor Depositary. The Depositary may at any time resign as Depositary
- -----------------------
hereunder by written notice of its election so to do delivered to the Company,
such resignation to take effect upon the appointment of a successor Depositary
and its acceptance of such appointment as hereinafter provided.
The Depositary may at any time be removed by the Company by written
notice of such removal delivered to the Depositary, such removal to take effect
upon the appointment of a successor Depositary and its acceptance of such
appointment as hereinafter provided.
In case the Depositary acting hereunder shall at any time resign or be
removed, the Company shall, within 60 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a successor Depositary,
which shall be a bank or trust company having its principal office in the United
States of America and having a combined capital and surplus of at least
$50,000,000. Every successor Depositary shall execute and deliver to its
predecessor and to the Company an instrument in writing accepting its
appointment hereunder, and thereupon such successor Depositary, without any
further act or deed, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor and for all purposes shall be the
Depositary under this Deposit Agreement, and such predecessor, upon payment of
all sums due it and on the written request of the Company, shall execute and
deliver an instrument transferring to such successor all rights and powers of
such predecessor hereunder, shall duly assign, transfer and deliver all right,
title and interest in the Stock and any moneys or property held hereunder to
such successor and shall deliver to such successor a list of the record holders
of all outstanding Receipts. Any successor Depositary shall promptly mail
notice of its appointment to the record holders of Receipts.
16
<PAGE>
Any corporation into or with which the Depositary may be merged,
consolidated or converted shall be the successor of such Depositary without the
execution or filing of any document or, any further act. Such successor
Depositary may authenticate the Receipts in the name of the predecessor
Depositary or in the name of the successor Depositary.
SECTION 5.05. Corporate Notices and Reports. The Company agrees that
-----------------------------
it will transmit to the Depositary all notices, reports and communications
(including without limitation financial statements) required by law, the rules
of any national securities exchange upon which the Stock, the Depositary Shares
or the Receipts are listed or by the Company's Amended and Restated Articles of
Incorporation, as amended (including the Articles Supplementary) to be furnished
by the Company to holders of the Stock or Receipts.
SECTION 5.06. Indemnification by the Company. The Company shall
------------------------------
indemnify the Depositary and any Depositary's Agent against, and hold each of
them harmless from, any loss, liability or expense (including the costs and
expenses of defending itself) which may arise out of (i) acts performed or
omitted in connection with this Deposit Agreement and the Receipts (a) by the
Depositary or any Depositary's Agent, except for any liability arising out of
the gross negligence or willful misconduct on the respective parts of any such
person or persons, or (b) by the Company or any of its agents, or (ii) the
offer, sale or registration of the Receipts or the Stock pursuant to the
provisions hereof.
SECTION 5.07. Charges and Expenses. The Company shall pay all
--------------------
transfer and other taxes and governmental charges arising solely from the
existence of the depositary arrangements. The Company shall pay all charges of
the Depositary in connection with the initial deposit of the Stock and the
initial issuance of the Receipts, any redemption of the Stock at the option of
the Company and any withdrawals of Stock by holders of Receipts. All other
transfer and other taxes and governmental charges shall be at the expense of
holders of Depositary Shares. If, at the request of a holder of Receipts, the
Depositary incurs charges or expenses for which it is not otherwise liable
hereunder, such holder will be liable for such charges and expenses. All other
charges and expenses of the Depositary and any Depositary's Agent hereunder
(including, in each case, fees and expenses of counsel) incident to the
performance of their respective obligations hereunder will be paid by the
Company after consultation and agreement between the Depositary and the Company
as to the amount and nature of such charges and expenses. The Depositary shall
present its statement for charges and expenses to the Company once every three
months or at such other intervals as the Company and the Depositary may agree.
17
<PAGE>
ARTICLE VI
Amendment and Termination
-------------------------
SECTION 6.01. Amendment. The form of the Receipts and any provisions
---------
of this Deposit Agreement may at any time and from time to time be amended by
agreement between the Company and the Depositary in any respect which they may
deem necessary or desirable; provided, however, that no such amendment which
-------- -------
imposes or increases any fees, taxes or charges upon holders of Depositary
Shares or Receipts or which materially and adversely alters the existing rights
of such holders shall be effective unless such amendment shall have been
approved by the record holders of Receipts evidencing at least a majority of the
Depositary Shares then outstanding. A holder of a Receipt at the time any such
amendment so becomes effective shall be deemed, by continuing to hold such
Receipt, to consent and agree to such amendment and to be bound by this Deposit
Agreement as amended thereby. Notwithstanding the foregoing, no such amendment
may impair the right of any holder of Depositary Shares or Receipts to receive
any moneys or other property to which such holder may be entitled under the
terms of such Receipts or this Deposit Agreement at the times and in the manner
and amount provided for therein and herein.
SECTION 6.02. Termination. This Deposit Agreement may be terminated
-----------
by the Company or the Depositary only after the occurrence of any of the
following events: (i) all outstanding Depositary Shares shall have been redeemed
and any accumulated and unpaid dividends on the Stock represented by the
Depositary Shares, together with all other moneys and property, if any, to which
holders of the related Receipts are entitled under the terms of such Receipts or
this Deposit Agreement, have been paid or distributed as provided in this
Deposit Agreement or provision therefor has been duly made pursuant to Section
2.03, (ii) there shall have been made a final distribution in respect of the
Stock in connection with any liquidation, dissolution or winding up of the
Company and such distribution shall have been distributed to the holders of
Receipts pursuant to Section 4.01 or 4.02, as applicable or (iii) all
outstanding Depositary Shares shall have been converted pursuant to Section 2.04
hereof.
Upon the termination of this Deposit Agreement, the Company shall be
discharged from all obligations under this Deposit Agreement except for its
obligations to the Depositary and any Depositary's Agent under Sections 5.06 and
5.07.
18
<PAGE>
ARTICLE VII
Miscellaneous
-------------
SECTION 7.01. Counterparts. This Deposit Agreement may be executed
------------
in any number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed an original, but all such counterparts taken together shall constitute
one and the same instrument.
SECTION 7.02. Exclusive Benefit of Parties. This Deposit Agreement
----------------------------
is for the exclusive benefit of the parties hereto, and their respective
successors hereunder, and shall not be deemed to give any legal or equitable
right, remedy or claim to any other person whatsoever.
SECTION 7.03. Invalidity of Provisions. In case any one or more of
------------------------
the provisions contained in this Deposit Agreement or in the Receipts should be
or become invalid, illegal or unenforceable in any respect, the validity,
legality and enforceability of the remaining provisions contained herein or
therein shall in no way be affected, prejudiced or disturbed thereby.
SECTION 7.04. Notices. Any and all notices to be given to the
-------
Company hereunder or under the Receipts shall be in writing and shall be deemed
to have been duly given if personally delivered or sent by mail or telegram or
telex confirmed by letter, addressed to the Company at 4675 MacArthur Court,
Suite 1170, Newport Beach, California 92660, to the attention of R. Bruce
Andrews or at any other address of which the Company shall have notified the
Depositary in writing.
Any and all notices to be given to the Depositary hereunder or under
the Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail or by telegram or telex confirmed by
letter, addressed to the Depositary at the Depositary's Office, at
__________________, __________, _________________, Attention:
_____________________, or at any other address of which the Depositary shall
have notified the Company in writing.
Any and all notices to be given to any record holder of a Receipt
hereunder or under the Receipts shall be in writing and shall be deemed to have
been duly given if personally delivered or sent by mail or by telegram or telex
confirmed by letter, addressed to such record holder at the address of such
record holder as it appears on the books of the Depositary, or if such holder
shall have filed with the Depositary a written request that notices intended for
such holder be mailed to some other address, at the address designated in such
request.
19
<PAGE>
Delivery of a notice sent by mail or by telegram or telex shall be
deemed to be effected at the time when a duly addressed letter containing the
same (or a confirmation thereof in the case of a telegram or telex message) is
deposited, postage prepaid, in a post office letter box. The Depositary or the
Company may, however, act upon any telegram or telex message received by it from
the other or from any holder of a Receipt, notwithstanding that such telegram or
telex message shall not subsequently be confirmed by letter or as aforesaid.
SECTION 7.05. Depositary's Agents. The Depositary may from time to
-------------------
time, with the prior approval of the Company appoint Depositary's Agents to act
in any respect for the Depositary for the purposes of this Deposit Agreement and
may at any time appoint additional Depositary's Agents and vary or terminate the
appointment of such Depositary's Agents. The Depositary will notify the Company
of any such action.
SECTION 7.06. Holders of Receipts Are Parties. The holders of
-------------------------------
Receipts from time to time shall be parties to this Deposit Agreement and shall
be bound by all of the terms and conditions hereof and of the Receipts by
acceptance of delivery thereof.
SECTION 7.07. Governing Law. THIS DEPOSIT AGREEMENT AND THE RECEIPTS
-------------
AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
YORK.
SECTION 7.08. Inspection of Deposit Agreement. Copies of this
-------------------------------
Deposit Agreement shall be filed with the Depositary and the Depositary's Agents
and shall be open to inspection during business hours at the Depositary's Office
and the respective offices of the Depositary's Agents, if any, by any holder of
a Receipt.
SECTION 7.09. Headings. The headings of articles and sections in
--------
this Deposit Agreement and in the form of the Receipt set forth in Exhibit A
hereto have been inserted for convenience only and are not to be regarded as a
part of this Deposit Agreement or the Receipts or to have any bearing upon the
meaning or interpretation of any provision contained herein or in the Receipts.
20
<PAGE>
IN WITNESS WHEREOF, the Company and the Depositary have duly executed
this Deposit Agreement as of the day and year first above set forth, and all
holders of Receipts shall become parties hereto by and upon acceptance by them
of delivery of Receipts issued in accordance with the terms hereof.
NATIONWIDE HEALTH PROPERTIES, INC.
By: _________________________
_______________________________
By: _________________________
21
<PAGE>
[FORM OF DEPOSIT RECEIPT]
[FORM OF FACE]
EXHIBIT A
DEPOSITARY RECEIPT
FOR
DEPOSITARY SHARES,
EACH REPRESENTING A ___________
INTEREST IN A SHARE OF ___%
__________ PREFERRED STOCK
($1.00 Par Value)
OF
NATIONWIDE HEALTH PROPERTIES, INC.
(Incorporated under the Laws of the State of Maryland)
This Depositary Receipt is transferable in
Los Angeles, California and New York, New York
NUMBER DEPOSITARY
SHARES
THIS CERTIFIES THAT _______________
IS THE REGISTERED OWNER OF
DEPOSITARY SHARES
____________, with an office at the time of the execution of the
Deposit Agreement (as defined below) at _______________________
_______________________________, as Depositary and Registrar (the "Depositary"),
hereby certifies that the registered owner specified above is the registered
owner of Depositary Shares ("Depositary Shares"), each Depositary Share
representing a _________ interest in a share of ___% __________ Preferred Stock,
$1.00 par value (the "Stock"), of Nationwide Health Properties, Inc., a
corporation duly organized and existing under the laws of the State of Maryland
(the "Company"), on deposit with the Depositary, subject to the terms and
entitled to the benefits of the Deposit Agreement (the "Deposit Agreement")
dated as of ______, 199_ between the Company, the Depositary and all holders
from time to time of Depositary Receipts (the "Receipts"). By accepting this
Receipt the holder hereof becomes a party to and agrees to be bound by all the
terms and conditions of the Deposit Agreement.
A-1
<PAGE>
Subject to the terms of the Deposit Agreement, each owner of a
Depositary Share is entitled, proportionately, through the Depositary, to all
the rights and preferences of the Stock relating thereto, including dividend,
voting, conversion, redemption and liquidation rights contained in the Articles
Supplementary adopted by the Company's Board of Directors setting forth the
number, terms, powers, designations, rights, preferences, qualifications,
restrictions and limitations of the Stock (the "Articles Supplementary"), copies
of which are on file at the Depositary's Office.
This receipt shall not be entitled to any benefits under the Deposit
Agreement or be valid or obligatory for any purpose, unless this Receipt shall
have been executed by the manual signature of a duly authorized officer of the
Depositary.
Dated:
________________________________
Depositary and Registrar
By______________________________
Authorized Officer
[FORM OF REVERSE]
1. The Deposit Agreement. The Receipts, of which this Receipt is
---------------------
one, are made available upon the terms and conditions set forth in the Deposit
Agreement. The Deposit Agreement (copies of which are on file at the
Depositary's Office) sets forth the rights of holders of Receipts and the rights
and duties of the Depositary and the Company in respect of the Stock deposited,
and any and all other property and cash deposited from time to time, thereunder.
The statements made on the face and the reverse of this Receipt are summaries of
certain provisions of the Deposit Agreement and are subject to the detailed
provisions thereof, to which reference is hereby made. Unless otherwise
expressly herein provided, all defined terms used herein shall have the meanings
ascribed thereto in the Deposit Agreement.
2. Redemption. Whenever the Company shall elect, in accordance with
----------
the provisions of the Articles Supplementary relating to the Stock, to redeem
shares of the Stock, it shall (unless otherwise agreed in writing with the
Depositary) mail notice to the Depositary of such redemption not less than 30
nor more than 60 days prior to the date fixed for redemption. The Depositary
shall mail notice of such redemption and the
A-2
<PAGE>
simultaneous redemption of the number of Depositary Shares relating to the Stock
to be redeemed not less than 30 and not more than 60 days prior to the date
fixed for redemption to the holders of record of Receipts evidencing the number
of Depositary Shares to be redeemed. Each such notice shall state: (a) the
date of such proposed redemption; (b) the number of Depositary Shares to be
redeemed; (c) the redemption price (which shall include full cumulative
dividends thereon to the redemption date); (d) the place or places where
Receipts evidencing Depositary Shares are to be surrendered for payment of the
redemption price; (e) that dividends in respect of the Stock underlying the
Depositary Shares to be redeemed will cease to accumulate at the close of
business on such redemption date; and (f) that the right to convert Depositary
Shares into shares of Common Stock, if applicable, will expire at the close of
business on the _____ day preceding the redemption date; the then-effective
conversion price and the place or places where Receipts for such Depositary
Shares are to be surrendered for conversion. In case less than all the
outstanding Depositary Shares are to be redeemed, the Depositary Shares to be so
redeemed shall be selected by lot or pro rata (subject to rounding to avoid
fractions of Depositary Shares) as may be determined by the Depositary to be
equitable. From and after the date set for redemption, all dividends in respect
of the Depositary Shares so called for redemption shall cease to accumulate,
such Depositary Shares shall no longer be deemed outstanding and all remaining
rights of the holders of Receipts evidencing such Depositary Shares (except the
right to receive the redemption price and to convert Depositary Shares into
Common Stock until the close of business on the _______ day preceding the
redemption date) shall cease and terminate. From and after the redemption date,
upon surrender in accordance with the redemption notice of the Receipts
evidencing any such Depositary Shares (properly endorsed or assigned for
transfer, if the Depositary shall so require), such Depositary Shares shall be
redeemed by the Depositary at a redemption price per share equal to ___________
of the redemption price per share paid in respect of the shares of Stock plus
any money or other property relating thereto.
3. Transfer, Split-ups and Combinations. This Receipt is
------------------------------------
transferable on the books of the Depositary upon surrender of this Receipt to
the Depositary, properly endorsed or accompanied by a properly executed
instrument of transfer, and upon such transfer the Depositary shall execute a
new Receipt to or upon the order of the person entitled thereto, as provided in
the Deposit Agreement. This Receipt may be split into other Receipts or
combined with other Receipts into one Receipt, representing the same aggregate
number of Depositary Shares as the Receipt or Receipts surrendered.
A-3
<PAGE>
4. Surrender of Receipts and Withdrawal of Stock, Conversion of
------------------------------------------------------------
Stock. Any holder of a Receipt or Receipts evidencing at least ______
- -----
Depositary Shares may withdraw the number of whole shares of Stock underlying
such Depositary Shares and all money and other property relating thereto by
surrendering Receipts evidencing such Depositary Shares. Thereafter, the
Depositary shall deliver to such holder the number of whole shares of Stock and
all money and other property underlying the Depositary Shares evidenced by the
Receipts so surrendered, but holders of such whole shares of Stock will not
thereafter be entitled to deposit such Stock under the Deposit Agreement or to
receive Receipts evidencing Depositary Shares therefor. If a Receipt delivered
by a holder to the Depositary in connection with such withdrawal shall evidence
a number of Depositary Shares relating to other than a whole number of shares of
Stock, the Depositary shall at the same time, in addition to such number of
whole shares of Stock and such money and other property to be so withdrawn,
deliver to such holder a new Receipt evidencing such excess number of Depositary
Shares. Delivery of the Stock and money and other property being withdrawn may
be made by delivery of such certificates, documents of title and other
instruments as the Depositary may deem appropriate.
If the Stock and the money and other property being withdrawn are to
be delivered to a person other than the record holder of the Depositary Shares
evidenced by the Receipts being surrendered, such holder shall deliver a written
order so directing the Depositary. The Depositary may require that Receipts
surrendered for withdrawal of Stock be properly endorsed in blank or accompanied
by a properly executed instrument of transfer.
Delivery of the Stock and the money and other property underlying the
Depositary Shares evidenced by the Receipts surrendered for withdrawal shall be
made by the Depositary at the Depositary's Office, except that, at the request,
risk and expense of the holder surrendering such Receipts and for the account of
such holder, such delivery may be made at such other place as may be designated
by such holder.
THE HOLDER HEREOF ACKNOWLEDGES THAT THERE WILL BE NO MARKET FOR THE
UNDERLYING STOCK AND THAT UPON WITHDRAWAL OF THE STOCK, THE HOLDER HEREOF WILL
NOT BE ENTITLED THEREAFTER TO DEPOSIT SUCH STOCK UNDER THE DEPOSIT AGREEMENT.
The Stock and Depositary Shares [are convertible into] the Common
Stock. The Company has agreed in Section 2.04 of the Deposit Agreement to
accept the delivery of Receipts for purposes of effecting conversions of the
Stock utilizing the same procedures as those provided for delivery of
certificates for the Stock to effect such conversions in accordance with the
terms and conditions of the Stock as provided in the Articles Supplementary.
Any whole number of Depositary Shares (whether or
A-4
<PAGE>
not evenly divisible by _____) represented by a Receipt may be surrendered for
conversion. If the Depositary Shares represented by a Receipt are to be
converted in part only, a new Receipt or Receipts will be issued by the
Depositary for the Depositary Shares not to be converted. No fractional shares
of Common Stock will be issued upon conversion, and if such conversion will
result in a fractional share being issued, an amount will be paid in cash by the
Company equal to the value of the fractional interest based upon the closing
price of the Common Stock on the last business day prior to the conversion. For
this purpose, a holder of a Receipt or Receipts must surrender such Receipt or
Receipts to the Company, together with a duly completed and executed Notice of
Conversion in the form included herein. In all cases the foregoing shall be
conditioned upon compliance in full by the holder hereof with the terms and
conditions of the Stock as provided in the Articles Supplementary and the
Deposit Agreement. As more fully set forth in Section 2.04 of the Deposit
Agreement, no adjustments will be made for accrued dividends upon conversion.
5. Suspension of Delivery, Transfer, etc. The transfer or surrender
-------------------------------------
of this Receipt may be suspended during any period when the register of
stockholders of the Company is closed or if any such action is deemed necessary,
or advisable by the Depositary, any Depositary's Agent, or the Company at any
time or from time to time because of any requirement of law or of any government
or governmental body or commission, or under any provision of the Deposit
Agreement.
6. Filing Proofs, Certificates and Other Information. Any holder of
-------------------------------------------------
a Depositary Receipt may be required to file such proof of residence, or other
matters or other information, to execute such certificates and to make such
representations and warranties as the Depositary or the Company may reasonably
deem necessary or proper. The Depositary or the Company may withhold the
delivery, or delay the registration of transfer, redemption, exchange or
conversion, of any Receipts, the withdrawal of any Stock underlying Depositary
Shares or the distribution of any dividend or other distribution or the sale of
any rights or of the proceeds thereof until such proof or other information is
filed or such certificates are executed or such representations and warranties
are made.
7. Payment of Taxes or Other Governmental Charges. Except as
----------------------------------------------
otherwise noted herein and in the Deposit Agreement, if any tax or other
governmental charge shall become payable by or on behalf of the Depositary with
respect to this Receipt, such tax (including transfer taxes, if any) or
governmental charge shall be payable by the holder hereof. Transfer of this
Receipt, any withdrawal of Stock and delivery of all money or other property, if
any, represented by the Depositary Shares evidenced by this Receipt may be
refused until such payment is made, and any dividends, interest payments or
other distributions may be
A-5
<PAGE>
withheld on all or any part of the Stock or other property relating to this
Receipt and not theretofore sold may be sold for the account of the holder
hereof (after attempting by reasonable means to notify such holder prior to such
sale), and such dividends, interest payments or other distributions or the
proceeds of any such sale may be applied to any payment of such tax or charge,
the holder of this Receipt remaining liable for any deficiency.
8. Warranty by Company. The Company has warranted that the Stock and
-------------------
the Common Stock issuable upon conversion of the Depositary Shares, when issued,
will be validly issued, fully paid and nonassessable.
9. Amendment. The form of the Receipts and any provisions of the
---------
Deposit Agreement may at any time and from time to time be amended by agreement
between the Company and the Depositary in any respect which they may deem
necessary or desirable; provided, however, that no such amendment which imposes
or increases any fees, taxes or charges upon holders of Depositary Shares or
Receipts or which materially and adversely alters the existing rights of such
holders shall be effective unless such amendment shall have been approved by the
record holders of Receipts evidencing at least a majority of the Depositary
Shares then outstanding. Notwithstanding the foregoing, no such amendment may
impair the right of any holder of Depositary Shares or Receipts to receive any
moneys or other property to which such holder may be entitled under the terms of
such Receipts or the Deposit Agreement at the times and in the manner and amount
provided for therein. A holder of a Receipt at the time any such amendment so
becomes effective shall be deemed, by continuing to hold such Receipt, to
consent and agree to such amendment and to be bound by the Deposit Agreement as
amended thereby.
10. Charges of Depositary. The Company will pay all transfer and
---------------------
other taxes and governmental charges arising solely from the existence of the
depositary arrangements, and all charges of the Depositary in connection with
the initial deposit of the Stock and the initial issuance of the Receipts, any
redemption of the Stock at the option of the Company and any withdrawals of
Stock by holders of the Receipts. All other transfer and other taxes and other
governmental charges shall be at the expense of holders of Depositary Shares.
Certain other charges and expenses of the Depositary and any Depositary's Agent
will be paid upon consultation and agreement between the Depositary and the
Company.
11. Title to Receipts. This Receipt (and the Depositary Shares
-----------------
evidenced hereby), when properly endorsed or accompanied by a properly executed
instrument of transfer, is transferable by delivery with the same effect as in
the case of a negotiable instrument; provided, however, that until transfer of
-------- -------
<PAGE>
a Receipt shall be registered on the books of the Depositary, the Depositary
may, notwithstanding any notice to the contrary, treat the record holder of such
Receipt at such time as the absolute owner thereof for the purpose of
determining the person entitled to receive distributions of dividends or other
distributions, withdraw any Stock underlying the Depositary Shares, exercise any
conversion rights or to receive any notice provided for in the Deposit Agreement
and for all other purposes.
12. Dividends and Distributions. Whenever the Depositary receives
---------------------------
any cash dividend or other cash distribution on the Stock, the Depositary will,
subject to the provisions of the Deposit Agreement, make such distribution to
the Receipt holders as nearly as practicable in proportion to the number of
Depositary Shares evidenced by the Receipts held by them; provided, however,
-------- -------
that the amount distributed will be reduced by any amounts required to be
withheld by the Company or the Depositary on account of taxes and governmental
charges. Other distributions received on the Stock may be distributed to
holders of Receipts as provided in the Deposit Agreement.
13. Fixing of Record Date. Whenever any cash dividend or other cash
---------------------
distribution shall become payable or any distribution other than cash shall be
made, or if rights, preferences or privileges shall at any time be offered, with
respect to Stock, or whenever the Depositary shall receive notice of any meeting
or action to be taken by written consent at or as to which holders of Stock are
entitled to vote or consent, or of which holders of Stock are entitled to
notice, the Depositary shall in each instance fix a record date (which shall be
the record date fixed by the Company with respect to the Stock), for the
determination of the holders of Receipts who shall be entitled to receive such
dividend, distribution, rights, preferences or privileges or the net proceeds of
the sale thereof, or to give instructions for the exercise of rights to vote or
consent at any such meeting, or who shall be entitled to notice of such meeting
or action.
14. Voting Rights. Upon receipt of notice of any meeting or action
-------------
to be taken by written consent at or as to which holders of Stock are entitled
to vote or consent, the Depositary shall, as soon as practicable thereafter,
mail to the record holders of Receipts a notice which shall contain (i) such
information as is contained in such notice of meeting or action and (ii) a
statement informing holders of Receipts that they may instruct the Depositary as
to the exercise of the voting rights or the giving or refusal of consent, as the
case may be, pertaining to the amount of Stock underlying their respective
Depositary Shares and a brief statement as to the manner in which such
instructions may be given. Upon the written request of a holder of a Receipt on
the record date (which will be the same date as the record date for the Stock),
the Depositary shall endeavor insofar as practicable to vote or cause to be
voted or
<PAGE>
give or withhold consent with respect to, the amount of Stock underlying such
Receipt in accordance with the instructions set forth in such request. In the
absence of specific instructions from the holder of a Receipt, the Depositary
will abstain from voting or giving consents (but, at its discretion, not from
appearing at any meeting with respect to such Stock unless directed to the
contrary by the holders of a majority of Receipts) to the extent of the Stock
underlying the Depositary Shares evidenced by such Receipt.
15. Changes Affecting Deposited Stock. Upon any change in par or
---------------------------------
stated value, split-up, combination or any other reclassification of the Stock
or upon any recapitalization, reorganization, merger, amalgamation or
consolidation affecting the Company or to which it is a party, or upon the sale
of all or substantially all the Company's assets, the Depositary may in its
discretion with the approval of, and shall upon the instructions of, the
Company, and in such manner as the Depositary may deem equitable, (i) make such
adjustments in (a) the fraction of an interest in one share of Stock underlying
one Depositary Share and (b) the ratio of the redemption price per Depositary
Share to the redemption price of a share of Stock, in each case as may be
necessary fully to reflect the effect of such change and (ii) treat any
securities which shall be received by the Depositary in exchange for or upon
conversion of or in respect of the Stock as new deposited securities so received
in exchange for or upon conversion of or in respect of such Stock. In any such
case the Depositary may in its discretion, with the approval of the Company,
execute and deliver additional Receipts, or may call for the surrender of
outstanding Receipts to be exchanged for new Receipts specifically describing
such new deposited securities.
16. Liability and Obligations of the Depositary, the Depositary's
-------------------------------------------------------------
Agents or the Company. Neither the Depositary nor any Depositary's Agent nor
- ---------------------
the Company assumes any obligation or shall be subject to any liability under
the Deposit Agreement to any holder of any Receipt, other than for its gross
negligence or willful misconduct. Neither the Depositary nor any Depositary's
Agent nor the Company shall incur any liability to any holder of any Receipt if
by reason of any provision of any present or future law or regulation thereunder
of the United States of America or any other governmental authority or, in the
case of the Depositary or any Depositary's Agent, by reason of any provision,
present or future, of the Company's Amended and Restated Articles of
Incorporation, (including the Articles Supplementary) or by reason of any act of
God or war or other circumstance beyond their control, the Depositary, any
Depositary's Agent or the Company shall be prevented or forbidden from doing or
performing any act or thing which the terms of the Deposit Agreement provide
shall be done or performed; nor shall the Depositary, any Depositary's Agent or
the Company incur any liability to any holder of a Receipt by reason of
nonperformance or delay, caused as aforesaid, in performance of any act or thing
<PAGE>
which by the terms of the Deposit Agreement it is provided shall or may be done
or performed, or by reason of any exercise of, or failure to exercise, any
discretion provided for in the Deposit Agreement, other than for its gross
negligence or willful misconduct. Neither the Depositary nor any Depositary's
Agent nor the Company shall be under any obligation to appear in, prosecute or
defend any action, suit or other proceeding in respect of the Stock, the
Depositary Shares or the Receipts, which in its opinion may involve it in
expense or liability, unless indemnity satisfactory to it against all expense
and liability be furnished. The Deposit Agreement contains various other
exculpatory, indemnification and related provisions, to which reference is
hereby made.
17. Resignation and Removal of Depositary. The Depositary may at any
-------------------------------------
time (i) resign by written notice of its election to do so delivered to the
Company, such resignation to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment, or (ii) be removed by the
Company effective upon the appointment of a successor Depositary and its
acceptance of such appointment.
18. Termination of Deposit Agreement. The Deposit Agreement may be
--------------------------------
terminated by the Company or the Depositary only after the occurrence of any of
the following events: (i) all outstanding Depositary Shares shall have been
redeemed and any accumulated and unpaid dividends on the Stock represented by
the Depositary Shares, together with all other moneys and property, if any, to
which holders of the related Receipts are entitled under the terms of such
Receipts or the Deposit Agreement, have been paid or distributed as provided in
the Deposit Agreement or provision therefor has been duly made or (ii) there
shall have been made a final distribution in respect of the Stock in connection
with any liquidation, dissolution or winding up of the Company and such
distribution shall have been distributed to the holders of the Receipts or (iii)
all outstanding Depositary Shares shall have been converted. Upon the
termination of the Deposit Agreement, the Company shall be discharged from all
obligations thereunder except for its obligations to the Depositary with respect
to indemnification, charges and expenses.
19. Governing Law. THIS RECEIPT AND THE DEPOSIT AGREEMENT AND ALL
-------------
RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK.
THE DEPOSITARY IS NOT RESPONSIBLE FOR THE VALIDITY OF ANY DEPOSITED
STOCK. THE DEPOSITARY ASSUMES NO RESPONSIBILITY FOR THE CORRECTNESS OF THE
FOREGOING DESCRIPTION WHICH CAN BE TAKEN AS A STATEMENT OF THE COMPANY
SUMMARIZING CERTAIN PROVISIONS OF THE DEPOSIT AGREEMENT WHICH APPEARS IN THE
RECEIPTS. THE DEPOSITARY MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE
VALIDITY, GENUINENESS OR SUFFICIENCY OF ANY STOCK AT
<PAGE>
ANY TIME DEPOSITED WITH THE DEPOSITARY HEREUNDER OR OF THE DEPOSITARY SHARES, AS
TO THE VALIDITY OR SUFFICIENCY OF THE DEPOSIT AGREEMENT, AS TO THE VALUE OF THE
DEPOSITARY SHARES OR AS TO ANY RIGHT, TITLE OR INTEREST OF THE RECORD HOLDERS OF
THE RECEIPTS TO THE DEPOSITARY SHARES.
THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH RECEIPT HOLDER WHO SO
REQUESTS A COPY OF THE DEPOSIT AGREEMENT AND A STATEMENT OR SUMMARY OF THE
POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER
SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF WHICH THE COMPANY IS
AUTHORIZED TO ISSUE AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH
PREFERENCES AND/OR RIGHTS. ANY SUCH REQUEST IS TO BE ADDRESSED TO THE SECRETARY
OF THE COMPANY.
The following abbreviations, when used in the inscription on the face
of this certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right of survivorship and not as tenants in
common
UNIF GIFT MIN ACT - ________ Custodian _________
(Cust) (Minor)
under the Uniform Gifts to Minors Act _______
(State)
Additional abbreviations may also be used though not in the above
list.
For value received, ________________ hereby sell(s), assign(s) and transfer(s)
unto ________________________________________
(Please insert social security or
other identifying number of Assignee)
____________________________________________________________
(Please print or typewrite Name and address including postal zip code of
Assignee)
__________ Depositary Shares represented by the within Receipt and all rights
thereunder, and do hereby irrevocably constitute and appoint _____________
Attorney to transfer said Depositary
<PAGE>
Shares on the books of the within-named Depositary with full power of
substitution in the premises.
Dated: _______________
_________________________________
NOTICE. The signature(s) to this
assignment must correspond with
the name(s) as written upon the
face of this instrument in every
particular, without alteration
or enlargement or any change
whatever.
SIGNATURE(S) GUARANTEED
By: _________________________
NOTICE OF CONVERSION
The undersigned holder of this Receipt for Depositary Shares (the
"Depositary Shares") hereby irrevocably exercises the option to convert _______
Depositary Shares evidenced thereby into shares of Common Stock (and any other
applicable securities or property) of the Company in accordance with the terms
and conditions of the Deposit Agreement, dated as of _______, 199_, among the
Company, ___________________________, as Depositary, and the holders from time
to time of Receipts referred to in such Deposit Agreement, and directs that
certificates for the securities deliverable upon such conversion be registered
in the name of and delivered, together with a check in payment for any
fractional shares and any other property deliverable upon which conversion to
the undersigned unless a different name has been indicated below. If securities
are to be registered in the name of a person other than the undersigned, the
undersigned will pay all transfer taxes payable with respect thereto. If the
number of Depositary Shares indicated above is less than the number of
Depositary Shares evidenced by this Receipt, the undersigned directs the
Depositary to issue to the undersigned, unless a
<PAGE>
different name is indicated below, a new Receipt evidencing the Depositary
Shares not so converted.
Dated: __________________ Signature
------------------------------
NOTE: The signature(s) to this assignment must
correspond with the name(s) as written upon the
face of the Receipt in every particular, without
alteration or enlargement, or any change whatever.
(Please print name and address of registered holder)
Name _______________________________________________________
Taxpayer Identification Number _____________________________
Address ____________________________________________________
(Please indicate other delivery instructions, if applicable)
Name _______________________________________________________
Address ____________________________________________________
<PAGE>
EXHIBIT 5.1
[LETTERHEAD OF O'MELVENY & MYERS LLP]
November
27th
1 9 9 6
Nationwide Health Properties, Inc.
4675 MacArthur Court
Suite 1170
Newport Beach, California 92660
Re: $300,000,000 Aggregate Offering Price of
Securities of Nationwide Health Properties, Inc.
------------------------------------------------
Gentlemen:
At your request, we have examined the Registration Statement on Form
S-3 (the "Registration Statement") to be filed by Nationwide Health Properties,
Inc. (the "Company") with the Securities and Exchange Commission in connection
with the registration of $300,000,000 aggregate offering price of securities
(the "Securities"), consisting of one or more series of unsecured debt
securities (the "Debt Securities"), warrants to purchase Debt Securities (the
"Debt Securities Warrants"), one or more series of shares of preferred stock,
par value $1.00 per share (the "Preferred Stock"), warrants to purchase
Preferred Stock (the "Preferred Stock Warrants"), depositary shares representing
interests in the Preferred Stock (the "Depositary Shares"), warrants to purchase
Depositary Shares (the "Depositary Shares Warrants"), shares of common stock,
par value $.10 per share (the "Common Stock"), and warrants to purchase Common
Stock (the "Common Stock Warrants," and with the Debt Securities Warrants, the
Preferred Stock Warrants and the Depositary Shares Warrants, being collectively
referred to herein as the "Securities Warrants"). We also have examined the
form of Indenture to be entered into by and between the Company and Bank of New
York, as Trustee, relating to the Debt Securities (the "Indenture"). We are
familiar with the proceedings heretofore
<PAGE>
Page 2 - Nationwide Health Properties, Inc. - November 27, 1996
taken and proposed to be taken by the Company in connection with the
authorization, registration, issuance and sale of the Securities.
Subject to (i) the proposed additional proceedings being taken as now
contemplated by us as your counsel prior to the issuance and sale of the
Securities; (ii) the effectiveness of the Registration Statement under the
Securities Act of 1933, as amended; (iii) the establishment of the terms of the
Debt Securities in accordance with the terms of the Indenture; (iv) the
establishment of the terms of the Preferred Stock, if applicable, in accordance
with the terms of the Company's Amended and Restated Articles of Incorporation
and applicable law; (v) the due authorization, execution and delivery of a
Deposit Agreement (in the case of Depositary Shares) and Warrant Agreement (in
the case of Securities Warrants); and (vi) the execution, delivery and
authentication of and payment for the Securities, it is our opinion that:
1. The Debt Securities, including any Debt Securities that may be
issued upon the exercise of any Debt Securities Warrants, will, upon the
issuance and sale thereof in the manner referred to in the Registration
Statement, constitute legally valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms, except as
may be limited by bankruptcy, insolvency, reorganization, moratorium or
similar laws relating to or affecting creditors' rights generally
(including, without limitation, fraudulent conveyance laws) and by general
principles of equity including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief, regardless of
whether considered in a proceeding in equity or at law.
2. The Preferred Stock, including any Preferred Stock that may be
issued upon the exercise of any Preferred Stock Warrants will, upon the
issuance and sale thereof in the manner referred to in the Registration
Statement, be validly issued, fully paid and nonassessable.
3. The persons in whose names the Depositary Shares represented by
depositary receipts are registered will be entitled to the rights specified
in the Deposit Agreement.
4. The Common Stock, including any Common Stock that may be issuable
pursuant to the conversion of any Debt Securities or Preferred Stock, or
upon exercise of any Common Stock Warrants, will, upon the issuance and
sale
<PAGE>
Page 3 - Nationwide Health Properties, Inc. - November 27, 1996
thereof in the manner specified in the Registration Statement, be validly
issued, fully paid and nonassessable.
5. The Securities Warrants will, upon the issuance and sale thereof
in the manner specified in the Registration Statement, be validly issued,
fully paid and nonassessable.
We consent to the filing of this opinion as an exhibit to the
Registration Statement.
Respectfully submitted,
/s/ O'MELVENY & MYERS LLP
<PAGE>
EXHIBIT 8.1
[LETTERHEAD OF O'MELVENY & MEYERS LLP]
November
27th
1 9 9 6
OUR FILE NUMBER
614,055-088
NB1-289101.V1
Nationwide Health Properties, Inc.
4675 MacArthur Court, Suite 1170
Newport Beach, California 92660
Re: Nationwide Health Properties, Inc. -
Form S-3 Registration Statement
------------------------------------
Gentlemen:
In connection with the above Registration Statement regarding the
proposed issuance and sale of the Securities of Nationwide Health Properties,
Inc., a Maryland corporation (the "Company"), you have requested our opinion
whether the Company qualified as a real estate investment trust (a "REIT") under
sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the
"Code"), for its taxable year ended December 31, 1995 and whether it will
continue to so qualify if it operates subsequent to September 30, 1996 in the
same manner as it has prior to that date. You have also asked our opinion
whether the Company should be treated as the owner of its properties listed in
the schedule which you provided to us (the "Properties") for federal income tax
purposes and whether the leases with respect to such Properties (the "Leases")
should be treated as true leases, and not financing arrangements, for such
purposes. All capitalized terms in this opinion and not otherwise defined
herein shall have the same respective meanings as set forth in the Registration
Statement.
As of June 18, 1996, we delivered our opinion (the "6/18/96 Opinion")
concerning the qualification of the Company as a REIT for its taxable year ended
December 31, 1995 and its continuing qualifications as a REIT if it operated
subsequent to
<PAGE>
Page 2 - Nationwide Health Properties, Inc. - November 27, 1996
March 31, 1996 in the same manner as it had prior to that date. The 6/18/96
Opinion, and the certificates, documents and other materials referred to
therein, are hereby incorporated by reference. Since June 18, 1996, there have
been delivered to us certain certificates and schedules prepared and executed by
Company personnel, setting forth certain factual representations regarding the
Company and its assets and operations. This opinion specifically relies on such
documents, certificates and schedules and assumes that the facts represented
therein will not change in any material way so long as the Company seeks to
qualify as a REIT.
On the basis of the foregoing and subject to all of the
qualifications, conditions and factual assumptions set forth herein and in the
6/18/96 Opinion, we are of the opinion that for the calendar year 1995, the
Company met each of the requirements for qualification as a REIT, and if the
Company operates subsequent to September 30, 1996 in the same manner as it has
prior to such date, it will continue to so qualify, provided that the various
tests for qualification as a REIT relating to its income, assets, distributions,
ownership and certain administrative matters are satisfied in those years.
However, we are unable to opine whether the Company will actually continue to
qualify as a REIT because such qualification will depend on future transactions
and events which cannot be known at this time.
We also wish to advise you that on the basis of and in reliance on the
foregoing and on the facts set forth in the Registration Statement, it is the
opinion of O'Melveny & Myers LLP that under current law, including relevant
statutes, regulations, and judicial and administrative precedent (which law is
subject to change on a retroactive basis), a court, more likely than not, would
hold that the Company would be treated as the owner of the Properties for
federal income tax purposes and the Leases would be treated as true leases, and
not financing arrangements, for such purposes. You should be aware that this
opinion is not binding on the Internal Revenue Service and no assurance can be
given that the Internal Revenue Service may not successfully challenge the
conclusions set forth in this opinion. If the Internal Revenue Service
successfully challenged such conclusions, the Company would not be entitled to
claim depreciation with respect to the Properties and might be compelled to make
deficiency dividends to satisfy the 95% dividend distribution requirement or
lose its REIT status.
Respectfully submitted,
/s/ O'MELVENY & MYERS LLP
<PAGE>
EXHIBIT 12
----------
NATIONWIDE HEALTH PROPERTIES, INC.
STATEMENT REGARDING COMPUTATION OF
RATIO OF EARNINGS TO FIXED CHARGES
(in thousands, except ratios)
<TABLE>
<CAPTION>
Nine
months
Year ended December 31, ended
----------------------------------------------- September 30,
1991 1992 1993 1994 1995 1996
------- ------- ------- ------- ------- -------------
<S> <C> <C> <C> <C> <C> <C>
Ratio 5.44 4.84 7.63 5.52 4.44 3.58
Pretax income from continuing operations $21,541 $29,681 $40,996 $44,513 $50,371 $40,043
Interest 4,849 8,162 6,186 9,921 14,628 15,539
------- ------- ------- ------- ------- -------
"Earnings" $26,390 $37,843 $47,162 $54,734 $64,999 $55,582
======= ======= ======= ======= ======= =======
"Fixed charges" $ 4,849 $ 8,162 $ 6,186 $ 9,921 $14,628 $15,539
======= ======= ======= ======= ======= =======
</TABLE>
<PAGE>
EXHIBIT 25
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________________
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE TRUST
INDENTURE ACT OF 1939 OF A CORPORATION
DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A
TRUSTEE PURSUANT TO SECTION 305(b)(2) ____________
______________________
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(Jurisdiction of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, New York 10286
(Address of principal executive offices) (Zip Code)
NATIONWIDE HEALTH PROPERTIES, INC.
(Exact name of obligor as specified in its charter)
Maryland 95-3997619
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
4675 MacArthur Court, Suite 1170
Newport Beach, California 92660
(Address of principal executive offices) (Zip Code)
_________________________
Debt Securities
(Title of the indenture securities)
<PAGE>
GENERAL
ITEM 1. General Information.
Furnish the following information as to the Trustee:
(a) Name and address of each examining or supervising authority to
which it is subject.
<TABLE>
<S> <C>
Superintendent of Banks of the State of 2 Rector Street, New York, N.Y. 10006,
New York and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20549
New York Clearing House Association New York, N.Y.
</TABLE>
(b) Whether it is authorized to exercise corporate trust powers:
Yes.
ITEM 2. Affiliations with Obligor
If the obligor is an affiliate of the trustee, describe each such
affiliation.
None. (See Note on page 2.)
_____________________________
ITEM 16. List of Exhibits:
Exhibits identified in parentheses below, on file with the Commission,
are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-
29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the
Commission's Rules of Practice.
1. - A copy of the Organization Certificate of The Bank of New York (formerly
Irving Trust Company) as now in effect, which contains the authority to
commence business and a grant of powers to exercise corporate trust
powers. (See Exhibit 1 to Amendment No. 1 to Form T-1 filed with
Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed
with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed
with Registration Statement No. 33-29637.)
4. - A copy of the existing By-laws of the Trustee. (See Exhibit 4 to
Form T-1 filed with Registration Statement No. 33-31019.)
6. - The consent of the Trustee required by Section 321(b) of the Act.
(See Exhibit 6 to Form T-1, Registration Statement No. 33-44051.)
7. - A copy of the latest report of condition of the Trustee published pursuant
to law or to the requirements of its supervising or examining authority.
(See Exhibit 7 to Form T-1, Registration Statement No. 33-55379.)
1
<PAGE>
NOTE
----
Inasmuch as this Form T-1 is filed prior to the ascertainment by the
Trustee of all facts on which to base responsive answer to Item 2, the answer to
said Item is based on incomplete information.
Item 2 may, however, be considered as correct unless amended by an
amendment to this Form T-1.
__________________________
SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a
corporation organized and existing under the laws of the State of New York, has
duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 18th day of November, 1996.
The Bank of New York
By: Byron Merino
---------------------
Byron Merino
Assistant Treasurer
2
<PAGE>
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10266
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business
June 30, 1996, published in accordance with a call made by the
Federal Reserve Bank of this District pursuant to the provisions of
the Federal Reserve Act.
<TABLE>
<CAPTION>
Dollar Amounts
ASSETS in Thousands
<S> <C>
Cash and balances due from
depository institutions:
Noninterest-bearing balances and
currency and coin............................... $ 3,650,068
Interest-bearing balances......................... 738,260
Securities:
Held-to-maturity securities....................... 784,969
Available-for-sale securities..................... 2,033,407
Federal funds sold and securities
purchased under agreements to
resell in domestic offices of
the bank:
Federal funds sold................................ 3,699,232
Securities purchased under
agreements to resell.............................. 20,000
Loans and lease financing
receivables:
Loans and leases, net of unearned
Income.............. 28,109,045
LESS: Allowance for loan and
lease losses........... 586,658
LESS: Allocated transfer risk
reserve.................... 429
Loans and leases, net of unearned
income, allowance, and reserve.................. 27,521,958
Assets held in trading accounts..................... 678,844
Premises and fixed assets (including
capitalized leases)............................... 608,217
Other real estate owned............................. 50,599
Investments in unconsolidated subsidiaries
and associated companies.......................... 235,670
Customers' liability to this bank on
acceptances outstanding........................... 904,948
Intangible assets................................... 450,230
Other assets........................................ 1,299,464
-----------
Total assets........................................ $42,675,866
===========
LIABILITIES
Deposits:
In domestic offices............................... $19,223,050
Noninterest-bearing..... 7,675,758
Interest-bearing....... 11,547,292
In foreign offices, Edge and
Agreement subsidiaries, and IBFs 11,527,685
Noninterest-bearing........ 48,502
Interest-bearing....... 11,479,183
Federal funds purchased and securities
sold under agreements to repurchase
in domestic offices of the bank and
of its Edge and Agreement
subsidiaries, and in IBFs:
Federal funds purchased........................... 1,498,351
Securities sold under agreements
to repurchase................................... 126,974
Demand notes issued to the U.S.
Treasury........................................ 231,865
Trading liabilities............................... 479,390
Other borrowed money:
With original maturity of one year
or less....................................... 2,521,578
With original maturity of more than
one year...................................... 20,780
Bank's liability on acceptances executed
and outstanding................................. 905,850
Subordinated notes and debentures................. 1,020,400
Other liabilities................................. 1,543,657
----------
Total liabilities................................. 39,099,580
==========
EQUITY CAPITAL
Common stock...................................... 942,284
Surplus........................................... 525,666
Undivided profits and capital
reserves........................................ 2,124,231
Net unrealized holding gains
(losses) on available-for-sale
securities...................................... ( 8,063)
Cumulative foreign currency translation
adjustments..................................... ( 7,832)
-----------
Total equity capital.............................. 3,576,286
-----------
Total liabilities and equity capital.............. $42,675,866
===========
</TABLE>
I, Robert E. Keilman, Senior Vice President and Comptroller of
the above-named bank do hereby declare that this Report of
Condition has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System
and is true to the best of my knowledge and belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of
this Report of Condition and declare that it has been examined
by us and to the best of our knowledge and belief has been
prepared in conformance with the instructions issued by the Board
of Governors of the Federal Reserve System and is true and correct.
J. Carter Bacot )
Alan R. Griffith } Directors
Thomas A. Renyi )
