Registration No. 333-
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------------
FORM S-4
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
--------------------
HEALTH AND RETIREMENT PROPERTIES TRUST
(Exact name of registrant as specified in its charter)
MARYLAND 6798 04-6558834
(State or other jurisdiction of (Primary Standard Industrial (I.R.S. Employer
incorporation or organization) Classification Code Number) Identification No.)
400 CENTRE STREET, NEWTON, MA 02158
(617) 332-3990
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
--------------------
David J. Hegarty
President
Health and Retirement Properties Trust
400 Centre Street
Newton, MA 02158
(617) 332-3990
(Name, address, including zip code, and telephone number, including area
code, of agent for service)
--------------------
Copy to:
Alexander A. Notopoulos, Jr., Esq.
Sullivan & Worcester LLP
One Post Office Square
Boston, MA 02109
(617) 338-2800
Approximate date of commencement of proposed sale to the public: As
soon as practicable after the effective date of this Registration Statement.
If the securities being registered on this Form are being offered in
connection with the formation of a holding company and there is compliance with
General Instruction G, check the following box. |_|
If this form is filed to register additional securities for an offering
pursuant to Rule 462(b) 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 this form is a post-effective amendment filed pursuant to Rule
462(d) 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. |_|
----------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
Title of Each Class of Securities to Amount to be Proposed Maximum Proposed Maximum Amount of
be Registered Registered Offering Price Per Unit Aggregate Offering Price Registration Fee(1)
- ---------------------------------- ----------------- ---------------------------- --------------------------- -------------------
<S> <C> <C> <C> <C> <C>
6 3/4% Senior Notes Due 2002 $150,000,000 -- $150,000,000 $44,250
================================== ================= ============================ =========================== ===================
<FN>
(1) Pursuant to Rule 457(f)(2) of the Securities Act of 1933, as amended, the
registration fee has been estimated based on the book value of the
securities to be received by the Registrant in exchange for the securities
to be issued hereunder in the Exchange Offer described herein.
</FN>
</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
will file a further amendment which specifically states that the Registration
Statement will thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933, as amended, or until the Registration Statement will
become effective on such date as the Securities and Exchange Commission, acting
pursuant to Section 8(a), may determine.
<PAGE>
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities of laws of any such State.
SUBJECT TO COMPLETION, DATED MARCH 12, 1998
OFFER TO EXCHANGE
all outstanding
6 3/4% Senior Notes Due 2002
which have not been registered under the Securities Act of
1933
for
6 3/4% Senior Notes Due 2002
which have been so registered
of
Health and Retirement Properties Trust
-------------------
The Exchange Offer will expire at 5:00 p.m.,
New York City Time on ______________,
1998, unless extended
--------------------------------------------
Health and Retirement Properties Trust, a Maryland real estate
investment trust (the "Company" or "HRP"), hereby offers, upon the terms and
subject to the conditions set forth in this Prospectus and the accompanying
Letter of Transmittal (the "Letter of Transmittal"), to exchange its 6 3/4%
Senior Notes Due 2002 (the "New Notes"), in an offering which has been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
pursuant to a Registration Statement of which this Prospectus constitutes a
part, for an equal principal amount of its outstanding 6 3/4% Senior Notes due
2002 (the "Old Notes"), of which an aggregate of $150,000,000 in principal
amount is outstanding as of the date hereof (the "Exchange Offer"). The New
Notes and the Old Notes are sometimes referred to herein collectively as the
"Notes." The form and terms of the New Notes will be the same as the form and
terms of the Old Notes except that the New Notes will not bear legends
restricting the transfer thereof. The New Notes will be obligations of the
Company entitled to the benefits of the Indenture and the Supplemental
Indenture, each dated as of December 18, 1997 (collectively, the "Indenture"),
by and between the Company and State Street Bank and Trust Company, as trustee
(the "Trustee"), relating to the Notes. See "Description of the New Notes."
Following the completion of the Exchange Offer, none of the New Notes will be
entitled to any rights under the Registration Rights Agreement, dated as of
December 18, 1997 (the "Registration Rights Agreement"), including, but not
limited to, contingent increases in the interest rate provided for pursuant
thereto.
----------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE 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 date of this Prospectus is _____________, 1998.
<PAGE>
The Company will accept for exchange any and all Old Notes that are
validly tendered on or prior to 5:00 p.m., New York City time, on the date the
Exchange Offer expires, which will be ______________, 1998 unless the Exchange
Offer is extended (the "Expiration Date"). Tenders of Old Notes may be withdrawn
at any time prior to 5:00 p.m., New York City time, on the Expiration Date. The
Exchange Offer is not conditioned upon any minimum principal amount of Old Notes
being tendered for exchange.
The Old Notes were initially represented by a single, permanent global
note (the "Global Note"), which was deposited with the Trustee, as custodian for
The Depository Trust Company ("DTC"), and registered in the name of Cede & Co.,
DTC's nominee, for credit to an account of a direct or indirect participant in
DTC. The New Notes exchanged for the Old Notes that are represented by the
Global Note will continue to be represented by a permanent global note in
definitive, fully registered form, registered in the name of a nominee of DTC
and deposited with the Trustee as custodian, unless the beneficial holders
thereof request otherwise. See "Description of the New Notes--Book Entry
System." Notes may be tendered only in denominations of $100,000 and integral
multiples of $1,000 in excess thereof.
Interest on the New Notes will be payable semi-annually in arrears on
June 18 and December 18 of each year (each an "Interest Payment Date"),
commencing June 18, 1998 to the person in whose name the applicable New Note is
registered at the close of business on the date (whether or not a business day)
15 calendar days preceding the applicable Interest Payment Date or December 18,
2002 (the "Maturity Date"). Interest on the New Notes will accrue from the most
recent date to which interest has been paid on the Old Notes or, if no interest
has been paid, from December 18, 1997. Accordingly, interest that has accrued
since the last Interest Payment Date or December 18, 1997 (as the case may be)
on the Old Notes accepted for exchange will cease to be payable upon issuance of
the New Notes. Untendered Old Notes that are not exchanged for New Notes
pursuant to the Exchange Offer will remain outstanding and continue to bear
interest at a rate of 6 3/4% per annum after the Expiration Date.
Based on no-action letters issued by the staff of the Securities and
Exchange Commission (the "Commission") to third parties, the Company believes
the New Notes issued pursuant to the Exchange Offer may be offered for resale,
resold and otherwise transferred by a holder thereof (other than (i) a
broker-dealer who acquires such New Notes directly from the Company to resell
pursuant to Rule 144A or any other available exemption under the Securities Act
or (ii) a person that is an affiliate of the Company (within the meaning of Rule
405 under the Securities Act)) without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that the holder
is acquiring the New Notes in the ordinary course of such holder's business and
is not participating, and has no arrangement or understanding with any person to
participate, in the distribution of the New Notes. Holders of Old Notes wishing
to accept the Exchange Offer must represent to the Company that such conditions
have been met. Each broker-dealer that receives New Notes for its own account
pursuant to the Exchange Offer must acknowledge that it will deliver a
prospectus in connection with any resale of such New Notes. The Letter of
Transmittal states that by so acknowledging and by delivering a prospectus, a
broker-dealer will not be deemed to admit that it is an "underwriter" within the
meaning of the Securities Act. This Prospectus, as it may be amended or
supplemented from time to time, may be used by a broker-dealer in connection
with resales of New Notes received in exchange for Old Notes where such Old
Notes were acquired by such broker-dealer as a result of market-making
activities or other trading activities. The Company has agreed for a period of
at least 120 days after the consummation of the Exchange Offer to make this
Prospectus available to any broker-dealer for use in connection with any such
resale. See "Plan of Distribution."
Prior to the Exchange Offer, there has been no public market for the
Old Notes or the New Notes. The Company does not intend to list the New Notes on
any securities exchange or to seek approval for quotation through any automated
quotation system. There can be no assurance that an active market for the New
Notes will develop. To the extent that a market for the New Notes develops, the
market value of the New Notes will depend on market conditions (such as yields
on alternative investments), general economic conditions, the Company's
financial condition and other conditions. Such conditions might cause the New
Notes, to the extent that they are actively traded, to trade at a significant
discount from the face value.
The Company will not receive any proceeds from the Exchange Offer. The
Company has agreed to bear the expenses of the Exchange Offer. No underwriter is
being used in connection with the Exchange Offer.
ii
<PAGE>
THE EXCHANGE OFFER IS NOT BEING MADE TO, NOR WILL THE COMPANY ACCEPT
SURRENDERS FOR EXCHANGE FROM, HOLDERS OF OLD NOTES IN ANY JURISDICTION IN WHICH
THE EXCHANGE OFFER OR THE ACCEPTANCE THEREOF WOULD NOT BE IN COMPLIANCE WITH THE
SECURITIES OR BLUE SKY LAWS OF SUCH JURISDICTION.
NEITHER THE FACT THAT A REGISTRATION STATEMENT OR AN APPLICATION FOR A
LICENSE HAS BEEN FILED WITH THE STATE OF NEW HAMPSHIRE NOR THE FACT THAT A
SECURITY IS EFFECTIVELY REGISTERED OR A PERSON IS LICENSED IN THE STATE OF NEW
HAMPSHIRE CONSTITUTES A FINDING BY THE SECRETARY OF STATE OF NEW HAMPSHIRE THAT
ANY DOCUMENT FILED UNDER RSA 421-B IS TRUE, COMPLETE AND NOT MISLEADING. NEITHER
ANY SUCH FACT NOR THE FACT THAT AN EXEMPTION OR EXCEPTION IS AVAILABLE FOR A
SECURITY OR A TRANSACTION MEANS THAT THE SECRETARY OF STATE HAS PASSED IN ANY
WAY UPON THE MERITS OR QUALIFICATIONS OF, OR RECOMMENDED OR GIVEN APPROVAL TO,
ANY PERSON, SECURITY, OR TRANSACTION, IT IS UNLAWFUL TO MAKE, OR CAUSE TO BE
MADE, TO ANY PROSPECTIVE PURCHASER, CUSTOMER OR CLIENT, ANY REPRESENTATION
INCONSISTENT WITH THE PROVISIONS OF THIS PARAGRAPH.
--------------------------
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 concerning the Company can be inspected
and copied at the public reference facilities maintained by the Commission at
450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549, and at the
Commission's Regional Offices at Seven World Trade Center, 13th Floor, New York,
New York 10048, and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of such materials can be obtained from the
Public Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024,
Washington, D.C. 20549, at prescribed rates. The Commission maintains a site on
the Internet's World Wide Web at http://www.sec.gov that contains reports, proxy
and information statements and other information regarding registrants that file
electronically with the Commission, including the Company on and after August
14, 1996. In addition, reports, proxy statements and other information
concerning the Company 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-4 (herein, together with all amendments and exhibits, referred to as the
"Registration Statement") under the Securities Act with respect to the New Notes
offered hereby. This Prospectus does not contain all of the information set
forth in the Registration Statement and the exhibits thereto, certain parts of
which are omitted in accordance with the rules and regulations of the
Commission. For further information with respect to the Company and the New
Notes offered hereby, reference is hereby made to the Registration Statement,
including the exhibits thereto, which is available for inspection and copying as
set forth above. Statements contained in this Prospectus as to the contents of
any contract or other document referred to herein or therein are not necessarily
complete (although to the extent of the provisions referred to herein, such
statements are complete in all material respects), and in each instance
reference is made to the copy of such contract or other document filed as an
exhibit to the Registration Statement or such other document, each such
statement being qualified in all respects by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by the Company with the
Commission, are incorporated herein by reference: (i) Current Reports on Form
8-K dated February 11, 1998, February 12, 1998, February 17, 1998, February 18,
1998, February 19, 1998 and February 27, 1998, (ii) Annual Report on Form 10-K
for the year ended December 31, 1997 and (iii) the consolidated financial
statements of Marriott International, Inc. ("MII"), Commission No. 1-12188, at
and for the fiscal year ended January 2, 1998, as contained in MII's Annual
Report on Form 10-K for the year ended January 2, 1998. All documents filed by
the Company pursuant to Section 13(a),
iii
<PAGE>
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of the initial
Registration Statement and prior to the effectiveness of the Registration
Statement and subsequent to the date of this Prospectus shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
date any such document is filed.
Any statement contained 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
(or in any other subsequently filed document which also is or is deemed to be
incorporated by reference herein) modifies or supersedes such statement. Any
such statement 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 a copy
of this Prospectus is delivered, upon written or oral request of such person, by
first class mail or other equally prompt means within one business day of
receipt of such request, a copy of any or all of the documents that are
incorporated by reference herein, other than exhibits to such documents (unless
such exhibits are specifically incorporated by reference into such documents).
Requests should be directed to Health and Retirement Properties Trust, 400
Centre Street, Newton, Massachusetts 02158, Attention: Investor Relations
(617-332-3990). In order to ensure timely delivery of such documents, any
request should be made before ___________, 1998.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND THE
ACCOMPANYING LETTER OF TRANSMITTAL, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATIONS MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. NEITHER THIS PROSPECTUS NOR THE ACCOMPANYING LETTER OF TRANSMITTAL, OR
BOTH TOGETHER, 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. NEITHER THIS PROSPECTUS NOR THE ACCOMPANYING LETTER OF
TRANSMITTAL, OR BOTH TOGETHER, CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY ANY OF THE SECURITIES OFFERED HEREBY BY ANYONE IN ANY
JURISDICTION 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 ANY
PERSON TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION.
FORWARD LOOKING STATEMENTS
THIS PROSPECTUS CONTAINS FORWARD LOOKING STATEMENTS. SUCH STATEMENTS
ARE SUBJECT TO CERTAIN RISKS AND UNCERTAINTIES WHICH COULD CAUSE ACTUAL RESULTS
TO DIFFER MATERIALLY FROM THOSE ANTICIPATED OR PROJECTED. PROSPECTIVE PURCHASERS
ARE CAUTIONED NOT TO PLACE UNDUE RELIANCE ON THESE FORWARD LOOKING STATEMENTS
WHICH SPEAK ONLY AS OF THE DATE HEREOF. THE COMPANY UNDERTAKES NO OBLIGATION TO
PUBLISH REVISED FORWARD LOOKING STATEMENTS TO REFLECT EVENTS OR CIRCUMSTANCES
AFTER THE DATE HEREOF OR TO REFLECT THE OCCURRENCE OF PRESENTLY UNANTICIPATED
EVENTS.
iv
<PAGE>
TABLE OF CONTENTS
Page
Prospectus Summary...........................................................1
Use of Proceeds..............................................................8
The Exchange Offer...........................................................8
Description of the New Notes................................................15
Description of the Indenture................................................22
Certain Federal Income Tax Considerations...................................28
Plan of Distribution........................................................30
Transfer Restrictions.......................................................30
Legal Matters...............................................................31
Experts.....................................................................31
Unaudited Pro Forma Consolidated Financial Statements......................F-1
<PAGE>
PROSPECTUS SUMMARY
The following summary is qualified in its entirety by, and should be
read in conjunction with, the more detailed information and financial statements
appearing elsewhere or incorporated by reference in this Prospectus. References
in this Prospectus Summary to the "Company" or "HRP" include consolidated
subsidiaries unless the context indicates otherwise.
The Company
The Company is one of the largest publicly traded REITs in the United
States with an equity market capitalization of approximately $2.0 billion at
December 31, 1997. The Company has investments of approximately $2.2 billion in
217 properties located in 33 states and the District of Columbia. The Company
principally invests in healthcare related real estate and office buildings
leased to various agencies of the United States Government. In addition,
approximately 5% of the Company's assets, at cost, is an equity investment in
Hospitality Properties Trust ("HPT"), a New York Stock Exchange listed REIT
formed by the Company which invests in hotels.
The principal executive offices of the Company are located at 400
Centre Street, Newton, MA 02158. Its telephone number is (617) 332-3990.
Summary of the Terms of the Exchange Offer
The Exchange Offer The Company is offering to exchange $100,000 in
principal amount (and integral multiples of $1,000
in excess thereof) of New Notes for each $100,000
in principal amount (and any integral multiples of
$1,000 in excess thereof) of Old Notes that are
validly tendered pursuant to the Exchange Offer.
The Company will issue the New Notes promptly
after the Expiration Date. As of the date of this
Prospectus, $150,000,000 in aggregate principal
amount of Old Notes are outstanding.
Resale The Company believes, based on no-action letters
issued by the Commission to third parties, that
the New Notes issued pursuant to the Exchange
Offer generally will be freely transferable by the
holders thereof without registration or any
prospectus delivery requirement under the
Securities Act, except that a "dealer" or any of
the Company's "affiliates," as such terms are
defined under the Securities Act, that exchanges
Old Notes held for its own account may be required
to deliver copies of this Prospectus in connection
with any resale of the New Notes issued in
exchange for such Old Notes. See "The Exchange
Offer--General" and "Plan of Distribution."
Expiration Date The Exchange Offer will expire at 5:00 p.m., New
York City time, on ___________, 1998, unless
extended, in which case the term "Expiration Date"
means the latest date and time to which the
Exchange Offer is extended. The Company will
accept for exchange any and all Old Notes that are
validly tendered in the Exchange Offer prior to
5:00 p.m., New York City time, on the Expiration
Date.
Accrued Interest on the New
Notes and the Old Notes Each New Note will bear interest from the
last Interest Payment Date on which interest was
paid on the Old Notes, or if interest has not yet
been paid on the Old Notes, from December 18,
1997. Such interest will be paid with the first
interest payment on the New Notes. Accordingly,
interest which has accrued since the last Interest
Payment Date or December 18, 1997 (as the case may
be) on the Old Notes accepted for exchange will
cease to be payable upon issuance of the New
Notes. Untendered Old Notes that are not exchanged
for New Notes
<PAGE>
pursuant to the Exchange Offer will continue to
bear interest at a rate of 6 3/4% per annum after
the Expiration Date.
Termination The Company may terminate the Exchange Offer if it
determines that its ability to proceed with the
Exchange Offer could be materially impaired due to
any legal or governmental action, any new law,
statute, rule or regulation or any interpretation
by the staff of the Commission of any existing
law, statute, rule or regulation. Holders of Old
Notes will have certain rights against the Company
under the Registration Rights Agreement should the
Company fail to consummate the Exchange Offer. See
"The Exchange Offer--Termination." No federal or
state regulatory requirements must be complied
with or approvals obtained in connection with the
Exchange Offer, other than applicable requirements
under federal and state securities laws.
Procedures for Tendering
Old Notes Each holder of Old Notes wishing to accept the
Exchange Offer must complete, sign and date the
Letter of Transmittal, or a facsimile thereof, in
accordance with the instructions contained herein
and therein, and mail or otherwise deliver such
Letter of Transmittal, or such facsimile, together
with such Old Notes and any other required
documentation to State Street Bank and Trust
Company, as Exchange Agent (the "Exchange Agent"),
at the address set forth herein and therein, or
effect a tender of Old Notes pursuant to the
procedure for book-entry transfer as provided for
herein. By executing the Letter of Transmittal,
each holder will represent to the Company that,
among other things, the New Notes acquired
pursuant to the Exchange Offer are being obtained
in the ordinary course of business of the person
receiving such New Notes, whether or not such
person is the holder, that neither the holder nor
any such other person has an arrangement or
understanding with any person to participate in
the distribution of such New Notes and, except as
otherwise disclosed in writing to the Company,
that neither the holder nor any such other person
is an "affiliate," as defined in Rule 405 under
the Securities Act, of the Company. Certain
brokers, dealers, commercial banks, trust
companies and other nominees may effect tenders by
book-entry transfer, including an Agent's Message
(defined below) in lieu of a Letter of
Transmittal. See "The Exchange Offer -- Procedures
for Tendering."
Special Procedures for
Beneficial Owners Any beneficial owner whose Old Notes are
registered in the name of a broker, dealer,
commercial bank, trust company or other nominee
and who wishes to tender such Old Notes in the
Exchange Offer should contact such registered
holder promptly and instruct such registered
holder to tender on such beneficial owner's
behalf. If such beneficial owner wishes to tender
on such owner's own behalf, such owner must, prior
to completing and executing the Letter of
Transmittal and delivering his Old Notes, either
make appropriate arrangements to register
ownership of the Old Notes in such owner's name or
obtain a properly completed bond power from the
registered holder. The transfer of record
ownership may take considerable time and may not
be able to be completed prior to the Expiration
Date.
Guaranteed Delivery
Procedures Holders of Old Notes who wish to tender their Old
Notes and whose Old Notes are not immediately
available or who cannot deliver their Old Notes,
the Letter of Transmittal or any other documents
required by the Letter of Transmittal to the
Exchange Agent prior to the Expiration Date must
tender their Old Notes
2
<PAGE>
according to the guaranteed delivery procedures
set forth in "The Exchange Offer--Guaranteed
Delivery Procedures."
Withdrawal Rights Tenders of Old Notes may be withdrawn at
any time prior to 5:00 p.m., New York City time,
on the Expiration Date.
Acceptance of Old Notes
and Delivery of New Notes Subject to certain conditions (as summarized above
in "Termination" and described more fully in "The
Exchange Offer--Termination"), the Company will
accept for exchange any and all Old Notes that are
validly tendered in the Exchange Offer prior to
5:00 p.m., New York City time, on the Expiration
Date. The New Notes issued pursuant to the
Exchange Offer will be delivered promptly
following the Expiration Date. See "The Exchange
Offer--General."
Certain Federal Income
Tax Considerations The exchange pursuant to the Exchange Offer should
generally not be a taxable event for federal
income tax purposes. For a discussion of certain
federal income tax considerations relating to the
exchange of the Old Notes for the New Notes, see
"Certain Federal Income Tax Considerations."
Exchange Agent The Trustee is also the Exchange Agent. The
mailing address of the Exchange Agent and address
for deliveries by registered or certified mail is:
State Street Bank and Trust Company, Corporate
Trust Department, Two International Place, Boston,
Massachusetts 02110, Attention: Sandy Wong. Hand
deliveries or overnight deliveries should be
directed to State Street Bank and Trust Company,
Corporate Trust Department, Two International
Place, Boston, Massachusetts 02110, Attention:
Sandy Wong. For information with respect to the
Exchange Offer, the telephone number for the
Exchange Agent is (617) 664- 5590.
Use of Proceeds There will be no cash proceeds payable to the
Company from the issuance of the New Notes
pursuant to the Exchange Offer. The net proceeds
received by the Company from the sale of the Old
Notes were used to reduce indebtedness outstanding
under the Company's $450 million bank credit
facility and for general business purposes. See
"Use of Proceeds."
Summary of the Terms of the New Notes
The Exchange Offer applies to an aggregate principal amount of
$150,000,000 of the Old Notes. The form and terms of the New Notes will be the
same as the form and terms of the Old Notes, except that the New Notes will not
bear legends restricting the transfer thereof. All capitalized terms used herein
and not defined herein have the meanings provided for in "Description of the New
Notes" and "Description of the Indenture." The New Notes will be obligations of
the Company entitled to the benefits of the Indenture. See "Description of New
Notes."
Issuer....................... Health and Retirement Properties Trust.
Securities Offered........... $150,000,000 aggregate principal amount of 6 3/4%
Senior Notes due 2002.
Maturity..................... The New Notes will mature on December 18, 2002,
unless previously redeemed.
3
<PAGE>
Interest Payment Dates....... Interest on the New Notes will be payable
semi-annually in arrears on June 18 and December
18 of each year, commencing June 18, 1998.
Ranking...................... The New Notes will be senior unsecured obligations
of the Company, and will rank equally with the
Company's other unsecured and unsubordinated
indebtedness. The New Notes will be effectively
subordinated to mortgages and other secured
indebtedness of the Company and to indebtedness
and other liabilities of any subsidiary of the
Company.
Optional Redemption.......... Until the date that is three months prior to their
stated maturity date, the New Notes will be
redeemable, at the option of the Company, in whole
or in part, at a redemption price equal to the sum
of (i) the principal amount of the New Notes being
redeemed, plus accrued and unpaid interest to but
excluding the redemption date and (ii) the
Make-Whole Amount. On and after such date, the New
Notes will be redeemable, at the option of the
Company, in whole or in part, at a redemption
price equal to the principal amount of the New
Notes being redeemed, plus accrued and unpaid
interest to but excluding the redemption date.
Limitations on Incurrence
of Debt............... The New Notes will contain various covenants
including the following:
(1) Neither the Company nor any Subsidiary (as
defined) may incur any Debt (as defined) if, after
giving effect thereto, the aggregate principal
amount of all outstanding Debt of the Company and
its Subsidiaries on a consolidated basis is
greater than 60% of the sum ("Adjusted Total
Assets") of (i) the Total Assets (as defined) of
the Company and its Subsidiaries as of the end of
the most recent calendar quarter and (ii) the
purchase price of any real estate assets or
mortgages receivable acquired, and the amount of
any securities offering proceeds received (to the
extent that such proceeds were not used to acquire
real estate assets or mortgages receivable or used
to reduce Debt), by the Company or any Subsidiary
since the end of such calendar quarter, including
those proceeds obtained in connection with the
incurrence of such additional Debt.
(2) Neither the Company nor any Subsidiary may
incur any Secured Debt if, after giving effect
thereto, the aggregate principal amount of all
outstanding Secured Debt of the Company and its
Subsidiaries on a consolidated basis is greater
than 40% of the Company's Adjusted Total Assets.
(3) Neither the Company nor any Subsidiary may
incur any Debt, if, after giving effect thereto,
the ratio of Consolidated Income Available for
Debt Service (as defined) to the Annual Debt
Service (as defined) for the four consecutive
fiscal quarters most recently ended prior to the
date on which such additional Debt is to be
incurred shall have been less than 1.5x on a pro
forma basis after giving effect to certain
assumptions.
4
<PAGE>
(4) The Company and its Subsidiaries will maintain
Total Unencumbered Assets of not less than 200% of
the aggregate outstanding principal amount of the
Unsecured Debt (as defined) of the Company and its
Subsidiaries on a consolidated basis.
For a more complete description of the terms and
definitions used in the foregoing summary of
Limitations on Incurrence of Debt, see
"Description of the New Notes--Certain Covenants."
Registration Rights.......... Pursuant to the Registration Rights Agreement
entered into by the Company and Merrill Lynch,
Pierce, Fenner & Smith Incorporated (the "Initial
Purchaser") concurrently with the closing of the
offering of the Old Notes, the Company agreed to
use its best efforts to (i) file within 105 days
of the original issuance of the Old Notes (the
"Issue Date"), a registration statement under the
Securities Act (the "Exchange Offer Registration
Statement") with respect to the Exchange Offer;
(ii) cause the Exchange Offer Registration
Statement to be declared effective within 150 days
of the Issue Date; and (iii) cause the Exchange
Offer to be consummated within the sooner to occur
of 45 days after the effective date of the
Exchange Offer Registration Statement or 180 days
after the Issue Date. In certain circumstances,
the Company will agree to file a shelf
registration statement (the "Shelf Registration
Statement") for resales of the Old Notes by the
holders thereof. If the Company does not comply
with its obligations under the Registration Rights
Agreement, the Company will be required to pay
Liquidated Damages to the holders of the Old
Notes. See "The Exchange Offer; General."
5
<PAGE>
Selected Financial Data
Set forth below are selected financial data for the Company for the
periods and dates indicated. This data should be read in conjunction with, and
its qualified in its entirety by reference to, the financial statements and
accompanying notes included in Item 7 of the Company's Current Report on Form
8-K dated February 27, 1998. Amounts are in thousands, except for per share
information.
<TABLE>
<CAPTION>
Income Statement Data: Year Ended December 31,
-----------------------------------------------------------------------------
1997 1996 1995 1994 1993
---------------- --------------- -------------- --------------- -------------
<S> <C> <C> <C> <C> <C>
Total Revenues $208,863 $120,183 $113,322 $ 86,683 $ 56,485
Income before gain (loss) on sale of
properties and extraordinary items 112,204 77,164 61,760 57,878 37,738
Income before extraordinary items 115,102 77,164 64,236 51,872 37,738
Net income 114,000 73,254 64,236 49,919 33,417
Funds from operations(1) 146,312 99,106 84,638 71,851 46,566
Dividends declared(2) 144,271 94,299 83,954 76,317 44,869
Basic earnings per common share amounts:
Income before gain (loss) on sale of
properties and extraordinary items 1.22 1.16 1.04 1.10 1.10
Income before extraordinary items 1.25 1.16 1.08 .98 1.10
Net income 1.24 1.11 1.08 .95 .97
Funds from operations(1) 1.59 1.50 1.43 1.36 1.35
Dividends declared(2) 1.46 1.42 1.38 1.33 1.30
Weighted average shares outstanding 92,168 66,255 59,227 52,738 34,407
<CAPTION>
Balance Sheet Data: At December 31,
-----------------------------------------------------------------------------
1997 1996 1995 1994 1993
---------------- --------------- -------------- --------------- -------------
<S> <C> <C> <C> <C> <C>
Real estate properties, at cost $1,969,023 $1,005,739 $ 778,211 $ 673,083 $ 384,811
Real estate mortgages and notes 104,288 150,205 141,307 133,477 157,281
Investment in HPT 111,134 103,062 99,959 -- --
Total assets 2,135,963 1,229,522 999,677 840,206 527,662
Total indebtedness 787,879 492,175 269,759 216,513 73,000
Total shareholders' equity 1,266,260 708,048 685,592 602,039 441,135
<FN>
(1) The Company's Funds From Operations ("FFO") represents net income (computed in accordance with
generally accepted accounting principles ("GAAP")), before gain or loss on sale of properties and
extraordinary items, depreciation and other non-cash items and includes HRP's pro rata share of HPT's
FFO. Management considers FFO to be a measure of the financial performance of an equity REIT that
provides a relevant basis for comparison among REITs. FFO does not represent cash flow from operating
activities (as determined in accordance with GAAP) and should not be considered as an alternative to net
income as an indicator of the Company's financial performance or to cash flows as a measure of liquidity.
(2) Amounts represent dividends declared with respect to the period shown.
Distribution in excess of net income generally constitute a return of
capital.
</FN>
</TABLE>
6
<PAGE>
Ratio of Earnings to Fixed Charges
The following table sets forth the Company's consolidated ratios of
earnings to fixed charges for the periods indicated:
<TABLE>
<CAPTION>
For the year ended December 31,
---------- -----------------------------------------------
1997 1996 1995 1994 1993
---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges 3.9x 4.3x 3.4x 6.7x 6.8x
</TABLE>
The ratios of earnings to fixed charges presented above were computed
by dividing the Company's earnings by fixed charges. For this purpose, earnings
have been calculated by adding fixed charges to income before income taxes,
extraordinary items and gain or loss on the disposition of real property. Fixed
charges consist of interest costs, whether expensed or capitalized, the interest
component of rental expense, if any, amortization of debt discounts and deferred
financing costs, whether expensed or capitalized. To date, the Company has not
issued any Preferred Shares; therefore, the ratio of earnings to combined fixed
charges and Preferred Shares distributions are the same as the ratios of
earnings to fixed charges presented above.
7
<PAGE>
USE OF PROCEEDS
The Company will not receive any cash proceeds from the issuance of the
New Notes offered hereby. In consideration for issuing the New Notes as
contemplated in this Prospectus, the Company will receive in exchange Old Notes
in like principal amount, the terms of which are identical to the New Notes. The
Old Notes surrendered in exchange for New Notes will be retired and canceled and
cannot be reissued. Accordingly, issuance of the New Notes will not result in
any increase in the indebtedness of the Company.
The net proceeds to the Company from the sale of the Old Notes was
approximately $149 million. The net proceeds were used in December 1997 to
reduce amounts outstanding under the Company's $450 million unsecured revolving
credit facility with a syndicate of banks (the "Bank Credit Facility"), and for
general business purposes. Outstanding amounts under the Company's Bank Credit
Facility bear interest, at the Company's option, at LIBOR plus a margin or
prime, and the Bank Credit Facility expires in 2001. At December 10, 1997, the
effective interest rate on outstanding amounts under the Bank Credit Facility
was 6.55% per annum, and at March 5, 1998 such effective interest rate was 6.4%
per annum.
THE EXCHANGE OFFER
General
In connection with the sale of the Old Notes, the Company entered into
the Registration Rights Agreement, which requires the Company to file with the
Commission a registration statement under the Securities Act with respect to an
issue of senior notes of the Company with terms identical to the Old Notes
(except with respect to restrictions on transfer) and to use its best efforts to
cause such registration statement to become effective under the Securities Act
by no later than May 15, 1998 and, upon the effectiveness of such registration
statement, to offer to the holders of the Old Notes the opportunity, for a
period of not less than 20 business days (or longer if required by applicable
law) from the date the notice of the Exchange Offer is mailed to holders of the
Old Notes, to exchange their Old Notes for a like principal amount of New Notes.
The Exchange Offer is being made pursuant to the Registration Rights Agreement
to satisfy the Company's obligations thereunder.
Under existing interpretations of the staff of the Commission
enunciated in no-action letters issued to third parties, the New Notes would, in
general, be freely transferable after the Exchange Offer without further
registration under the Securities Act by holders thereof (other than (i) a
broker-dealer who acquires such New Notes directly from the Company to resell
pursuant to Rule 144A or any other available exemption under the Securities Act
or (ii) a person that is an affiliate of the Company within the meaning of Rule
405 under the Securities Act), without compliance with the registration and
prospectus delivery provisions of the Securities Act, provided that such New
Notes are acquired in the ordinary course of such holders' business and such
holders have no arrangements with any person to participate in the distribution
of such New Notes. Eligible holders wishing to accept the Exchange Offer must
represent to the company that such conditions have been met. Each broker-dealer
that receives New Notes for its own account pursuant to the Exchange Offer must
acknowledge that it will deliver a prospectus in connection with any resale of
such New Notes.
In the event that (i) the Exchange Offer is not consummated within the
earlier of 45 days of the effective date of the Exchange Offer Registration
Statement or 180 days after the Issue Date; or (ii) in the case of any holder of
Old Notes that participates in the Exchange Offer, such holder does not receive
freely tradeable New Notes on the date of such exchange, the Company will, at
its own expense, (a) as promptly as practicable, file a shelf registration
statement, (b) use its best efforts to cause such Shelf Registration Statement
to be declared effective under the Securities Act as promptly as practicable
after the filing of such Shelf Registration Statement and (c) use its best
efforts to keep effective such Shelf Registration Statement in order to permit
the prospectus forming a part thereof to be usable by holders of Old Notes for a
period of two years after the effective date of the Shelf Registration Statement
(or, the shorter period provided by Rule 144(k) under the Securities Act) or
such shorter period that will terminate when all the Old Notes covered by the
Shelf Registration Statement have been sold pursuant to the Shelf Registration
Statement.
8
<PAGE>
Terms of the Exchange Offer
Upon the terms and subject to the conditions set forth in this
Prospectus and in the accompanying Letter of Transmittal, the Company will
accept all Old Notes validly tendered prior to 5:00 p.m., New York City time, on
the Expiration Date. The Company will issue $100,000 in principal amount of New
Notes (and integral multiples of $1,000 in excess thereof) in exchange for an
equal principal amount of outstanding Old Notes tendered and accepted in the
Exchange Offer. Holders may tender some or all of their Old Notes pursuant to
the Exchange Offer in any denomination of $100,000 or in integral multiples of
$1,000 in excess thereof.
The form and terms of the New Notes will be the same as the form and
terms of the Old Notes except that the New Notes will not bear legends
restricting the transfer thereof. The New Notes will evidence the same debt as
the Old Notes. The New Notes will be issued under and entitled to the benefits
of the Indenture.
As of the date of this Prospectus, $150,000,000 million aggregate
principal amount of the Old Notes are outstanding and CEDE & Co., the nominee of
DTC, is the only registered holder thereof. In connection with the issuance of
the Old Notes, the Company arranged for the Old Notes to be eligible for trading
in the Private Offering, Resale and Trading through Automated Linkages (PORTAL)
Market, the National Association of Securities Dealers' screen based, automated
market trading of securities eligible for resale under Rule 144A, and to be
issued and transferable in book-entry form through the facilities of DTC. The
New Notes will also be issuable and transferable in book-entry form through DTC.
This Prospectus, together with the accompanying Letter of Transmittal,
is being sent to all registered holders as of ____________, 1998 (the "Record
Date").
The Company shall be deemed to have accepted validly tendered Old Notes
when, as and if the Company has given oral or written notice thereof to the
Exchange Agent. See "Exchange Agent." The Exchange Agent will act as agent for
the tendering holders of Old Notes for the purpose of receiving New Notes from
the Company and delivering New Notes to such holders.
If any tendered Old Notes are not accepted for exchange because of an
invalid tender or the occurrence of certain other events set forth herein,
certificates for any such unaccepted Old Notes will be returned, without
expense, to the tendering holder thereof as promptly as practicable after the
Expiration Date.
The Company will pay all charges and expenses, other than certain
applicable taxes, in connection with the Exchange Offer. See "Fees and
Expenses."
Holders of Old Notes do not have any appraisal or dissenters' rights
under applicable Maryland law or the Indenture in connection with the Exchange
Offer. The Company intends to conduct the Exchange Offer in accordance with the
provisions of the Registration Rights Agreement and the applicable requirements
of the Exchange Act and the rules and regulations of the Commission thereunder.
Old Notes that are not tendered for exchange in the Exchange Offer will remain
outstanding and continue to accrue interest, but will not be entitled to any
rights or benefits under the Registration Rights Agreement.
Each holder of Old Notes who wishes to exchange Old Notes for New Notes
in the Exchange Offer will be required to make certain representations,
including that (i) it is neither an affiliate of the Company nor a broker-dealer
tendering Old Notes acquired directly from the Company for its own account, (ii)
any New Notes to be received by it were acquired in the ordinary course of its
business and (iii) at the time of commencement of the Exchange Offer, it has no
arrangement with any person to participate in the distribution (within the
meaning of the Securities Act) of the New Notes. In addition, in connection with
any resales of New Notes, any broker-dealer (a "Participating Broker-Dealer")
who acquired Old Notes for its own account as a result of market-making
activities or other trading activities must deliver a prospectus meeting the
requirements of the Securities Act in connection with any resale of the New
Notes. See "Plan of Distribution." The Commission has taken the position, in
no-action letters issued to third parties, that Participating Broker-
8
<PAGE>
Dealers may fulfill their prospectus delivery requirements with respect to the
New Notes (other than a resale of an unsold allotment from the original sales of
Old Notes) with this Prospectus. Under the Registration Rights Agreement, the
Company is required to allow Participating Broker-Dealers (and other persons, if
any, subject to similar prospectus delivery requirements) to use this Prospectus
in connection with the resale of such New Notes, provided, however, the Company
shall not be required to amend or supplement such prospectus for a period
exceeding 120 days after the effectiveness of the Exchange Offer Registration
Statement.
If (a) the Company fails to consummate the Exchange Offer on or before
the 45th day after the effective date of the Registration Statement or 180 days
after the Issue Date or (b) either the Exchange Offer Registration Statement or
the Shelf Registration Statement is declared effective but thereafter ceases to
be effective in connection with resales of Old Notes or New Notes during the
period specified in the Registration Rights Agreement (each such event referred
to in clauses (a) and (b) above a "Registration Default"), then the Company will
pay to each holder of the Old Notes, accruing from the date of the first such
Registration Default (or if such Registration Default has been cured, from the
date of the next Registration Default), liquidated damages ("Liquidated
Damages") in an amount equal to 0.50% per annum of the principal amount of the
Old Notes held by such holder. Following the cure of all Registration Defaults,
the accrual of Liquidated Damages will cease.
If the Exchange Offer is consummated in accordance with the provisions
of the Registration Rights Agreement described above, the Company will not be
required to file a Shelf Registration Statement to register any outstanding Old
Notes, and the interest rate on such Old Notes will remain at its initial level
of 6 3/4% per annum. The Exchange Offer shall be deemed to have been consummated
upon the Company's having exchanged, pursuant to the Exchange Offer, New Notes
for all Old Notes that have been properly tendered and not withdrawn by the
Expiration Date. In such event, holders of Old Notes not participating in the
Exchange Offer who are seeking liquidity in their investment would have to rely
on exemptions to registration requirements under the securities laws, including
the Securities Act.
Based on no-action letters issued by the staff of the Commission to
third parties, the Company believes that the New Notes issued pursuant to the
Exchange Offer in exchange for Old Notes may be offered for resale, resold and
otherwise transferred by holders thereof (other than any such holder that is an
"affiliate" of the Company within the meaning of Rule 405 under the Securities
Act) without compliance with the registration and prospectus delivery
requirements of the Securities Act, provided that such New Notes are acquired in
the ordinary course of such holders' business and such holders have no
arrangement with any person to participate in the distribution of such New
Notes. Any holder of Old Notes who tenders in the Exchange Offer for the purpose
of participating in a distribution of the New Notes cannot rely on such
interpretation by the staff of the Commission and must comply with the
registration and prospectus delivery requirements of the Securities Act in
connection with any resale transaction. Each broker-dealer that receives New
Notes for its own account in exchange for Old Notes, where such Old Notes were
acquired by such broker-dealer as a result of market-making activities or other
trading activities, must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes.
Expiration Date; Extensions; Amendments
The term "Expiration Date" shall mean 5:00 p.m. New York City time, on
_________, 1998 unless the Company, in its sole discretion, extends the Exchange
Offer, in which case the term "Expiration Date" shall mean the latest date to
which the Exchange Offer is extended.
In order to extend the Expiration Date, the Company will notify the
Exchange Agent of any extension by oral or written notice and will mail to the
record holders of Old Notes an announcement thereof, each prior to 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date. Such announcement may state that the Company is extending the
Exchange Offer for a specified period of time.
The Company reserves the right (i) to delay acceptance of any Old
Notes, to extend the Exchange Offer or to terminate the Exchange Offer and to
refuse to accept Old Notes not previously accepted, if any of the conditions set
forth herein under "Termination" shall have occurred and shall not have been
waived by the Company (if permitted to be waived by the Company), by giving oral
or written notice of such delay, extension or termination to the Exchange Agent,
and (ii) to amend the terms of the Exchange Offer in any manner deemed by it to
be advantageous to the holders of the Old Notes. Any such delay in acceptance,
extension, termination or amendment will be followed as promptly as practicable
by oral or written notice thereof. If the Exchange Offer is amended in
10
<PAGE>
a manner determined by the Company to constitute a material change, the Company
will promptly disclose such amendment in a manner reasonably calculated to
inform the holders of the Old Notes of such amendment.
Without limiting the manner in which the Company may choose to make
public announcements of any delay in acceptance, extension, termination or
amendment of the Exchange Offer, the Company shall have no obligation to
publish, advertise, or otherwise communicate any such public announcement, other
than by making a timely release to the Dow Jones News Service.
Interest on the New Notes
The New Notes will bear interest from the last Interest Payment Date on
which interest was paid on the Old Notes, or if interest has not yet been paid
on the Old Notes, from December 18, 1997. Such interest will be paid with the
first interest payment on the New Notes. Interest on the Old Notes accepted for
exchange will cease to accrue upon issuance of the New Notes.
The New Notes will bear interest at a rate of 6 3/4% per annum.
Interest on the New Notes will be payable semi-annually, in arrears on each
Interest Payment Date following the consummation of the Exchange Offer.
Untendered Old Notes that are not exchanged for New Notes pursuant to the
Exchange Offer will continue to bear interest at a rate of 6 3/4% per annum
after the Expiration Date.
Procedures for Tendering
To tender in the Exchange Offer, a holder must complete, sign and date
the Letter of Transmittal, or a facsimile thereof, have the signatures thereon
guaranteed if required by the Letter of Transmittal, and mail or otherwise
deliver such Letter of Transmittal or such facsimile or an Agent's Message
(defined below) in lieu thereof, together with the Old Notes (unless the
book-entry transfer procedures described below are used) and any other required
documents, to the Exchange Agent for receipt prior to 5:00 p.m., New York City
time, on the Expiration Date.
The term "Agent's Message" means a message, transmitted by DTC's
Book-Entry Transfer Facility system to, and received by, the Exchange Agent and
forming a part of a Book-Entry Confirmation, which states that DTC's Book-Entry
Transfer Facility system has received an express acknowledgment from the
participant in DTC's Book-Entry Transfer Facility system tendering Old Notes
which are the subject of such Book-Entry Confirmation that such participant has
received and agrees to be bound by the terms of the Letter of Transmittal, and
that the Company may enforce such agreement against such participant. The term
"Book-Entry Confirmation" means a timely confirmation of book-entry transfer of
Old Notes to the Exchange Agent's account at DTC's Book-Entry Transfer Facility
system.
Any financial institution that is a participant in DTC's Book-Entry
Transfer Facility system may make book-entry delivery of the Old Notes by
causing DTC to transfer such Old Notes into the Exchange Agent's account in
accordance with DTC's procedure for such transfer. Although delivery of Old
Notes may be effected through book-entry transfer into the Exchange Agent's
account at DTC, an Agent's Message must be transmitted to and received by the
Exchange Agent on or prior to the Expiration Date at one of its addresses set
forth in this Prospectus, or the Letter of Transmittal (or facsimile thereof),
with any required signature guarantees and any other required documents, must be
transmitted to and received or confirmed by the Exchange Agent at its addresses
set forth in this Prospectus prior to 5:00 p.m., New York City time, on the
Expiration Date. DELIVERY OF DOCUMENTS TO DTC IN ACCORDANCE WITH ITS PROCEDURES
DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE AGENT. All references in this
Prospectus to deposit or delivery of Old Notes shall be deemed to include DTC's
book-entry delivery method.
The tender by a holder of Old Notes will constitute an agreement
between such holder and the Company in accordance with the terms and subject to
the conditions set forth herein and in the Letter of Transmittal.
Delivery of all documents must be made to the Exchange Agent at its
address set forth herein. Holders may also request that their respective
brokers, dealers, commercial banks, trust companies or nominees effect such
tender for such holders.
11
<PAGE>
The method of delivery of Old Notes and the Letter of Transmittal and
all other required documents to the Exchange Agent is at the election and risk
of the holders. Instead of delivery by mail, it is recommended that holders use
an overnight or hand delivery service. In all cases, sufficient time should be
allowed to assure timely delivery. No Letter of Transmittal or Old Notes should
be sent to the Company.
Only a holder of Old Notes may tender such Old Notes in the Exchange
Offer. The term "holder" with respect to the Exchange Offer means any person in
whose name Old Notes are registered on the books of the Company or any other
person who has obtained a properly completed bond power from the registered
holder or any person whose Old Notes are held of record by DTC who desires to
deliver such Old Notes by book-entry transfer at DTC.
Any beneficial holder whose Old Notes are registered in the name of his
broker, dealer, commercial bank, trust company or other nominee and who wishes
to tender should contact such registered holder promptly and instruct such
registered holder to tender on his behalf. If such beneficial holder wishes to
tender on his own behalf, such beneficial holder must, prior to completing and
executing the Letter of Transmittal and delivering his Old Notes, either make
appropriate arrangements to register ownership of the Old Notes in such holder's
name or obtain a properly completed bond power from the registered holder. The
transfer of record ownership may take considerable time.
Signatures on a Letter of Transmittal or a notice of withdrawal, as the
case may be, must be guaranteed by a member firm of a registered national
securities exchange or of the National Association of Securities Dealers, Inc.,
a commercial bank or trust company having an office or correspondent in the
United States or an "eligible guarantor institution" within the meaning of Rule
17Ad-15 under the Exchange Act (an "Eligible Institution") that is a participant
in a recognized medallion signature guarantee program unless the Old Notes
tendered pursuant thereto are tendered (i) by a registered holder who has not
completed the box entitled "Special Issuance Instructions" or "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution.
If the Letter of Transmittal is signed by a person other than the
registered holder of any Old Notes listed therein, such Old Notes must be
endorsed or accompanied by appropriate bond powers which authorize such person
to tender the Old Notes on behalf of the registered holder, in either case
signed as the name of the registered holder or holders appears on the Old Notes.
If the Letter of Transmittal or any Old Notes or bond powers are signed
by trustees, executors, administrators, guardians, attorneys-in-fact, officers
of corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and unless waived by the Company,
submit evidence satisfactory to the Company of their authority to so act with
the Letter of Transmittal.
All questions as to the validity, form, eligibility (including time of
receipt), acceptance and withdrawal of the tendered Old Notes will be determined
by the Company in its sole discretion, which determination will be final and
binding. The Company reserves the absolute right to reject any and all Old Notes
not properly tendered or any Old Notes the Company's acceptance of which would,
in the opinion of counsel for the Company, be unlawful. The Company also
reserves the absolute right to waive any irregularities or conditions of tender
as to particular Old Notes. The Company's interpretation of the terms and
conditions of the Exchange Offer (including the instructions in the Letter of
Transmittal) will be final and binding on all parties. Unless waived, any
defects or irregularities in connection with tenders of Old Notes must be cured
within such time as the Company shall determine. Neither the Company, the
Exchange Agent nor any other person shall be under any duty to give notification
of defects or irregularities with respect to tenders of Old Notes nor shall any
of them incur any liability for failure to give such notification. Tenders of
Old Notes will not be deemed to have been made until such irregularities have
been cured or waived. Any Old Notes received by the Exchange Agent that are not
properly tendered and as to which the defects or irregularities have not been
cured or waived will be returned without cost by the Exchange Agent to the
tendering holder of such Old Notes unless otherwise provided in the Letter of
Transmittal as soon as practicable following the Expiration Date.
In addition, the Company reserves the right in its sole discretion to
(a) purchase or make offers for any Old Notes that remain outstanding subsequent
to the Expiration Date, or, as set forth under "Termination," to terminate
12
<PAGE>
the Exchange Offer and (b) to the extent permitted by applicable law, purchase
Old Notes in the open market, in privately negotiated transactions or otherwise.
The terms of any such purchases or offers may differ from the terms of the
Exchange Offer.
Guaranteed Delivery Procedures
Holders who wish to tender their Old Notes and (i) whose Old Notes are
not immediately available, or (ii) who cannot deliver their Old Notes, the
Letter of Transmittal or any other required documents to the Exchange Agent
prior to the Expiration Date, or if such holder cannot complete the procedure
for book-entry transfer on a timely basis, may effect a tender if:
(a) the tender is made through an Eligible Institution;
(b) prior to the Expiration Date, the Exchange Agent receives
from such Eligible Institution a properly completed and duly executed
Notice of Guaranteed Delivery (by facsimile transmission, mail or hand
delivery) setting forth the name and address of the holder of the Old
Notes, the certificate number or numbers of such Old Notes and the
principal amount of Old Notes tendered, stating that the tender is
being made thereby, and guaranteeing that, within three business days
after the Expiration Date, the Letter of Transmittal (or facsimile
thereof), together with the certificate(s) representing the Old Notes
(unless the book-entry transfer procedures are to be used) to be
tendered in proper form for transfer and any other documents required
by the Letter of Transmittal, will be deposited by the Eligible
Institution with the Exchange Agent; and
(c) such properly completed and executed Letter of Transmittal
(or facsimile thereof), together with the certificate(s) representing
all tendered Old Notes in proper form for transfer (or confirmation of
a book-entry transfer into the Exchange Agent's account at DTC of Old
Notes delivered electronically) and all other documents required by the
Letter of Transmittal are received by the Exchange Agent within three
business days after the Expiration Date.
Upon request to the Exchange Agent, a Notice of Guaranteed Delivery
will be sent to holders who wish to tender their Old Notes according to the
guaranteed delivery procedures set forth above.
Withdrawal of Tenders
Except as otherwise provided herein, tenders of Old Notes may be
withdrawn at any time prior to 5:00 p.m., New York City time, on the Expiration
Date.
To withdraw a tender of Old Notes in the Exchange Offer, a written or
facsimile transmission notice of withdrawal must be received by the Exchange
Agent at its address set forth herein prior to 5:00 p.m., New York City time, on
the Expiration Date. Any such notice of withdrawal must (i) specify the name of
the person having deposited the Old Notes to be withdrawn (the "Depositor"),
(ii) identify the Old Notes to be withdrawn (including the certificate number or
numbers and principal amount of such Old Notes), (iii) be signed by the
Depositor in the same manner as the original signature on the Letter of
Transmittal by which such Old Notes were tendered (including any required
signature guarantees) or be accompanied by documents of transfer sufficient to
permit the Trustee with respect to the Old Notes to register the transfer of
such Old Notes into the name of the Depositor withdrawing the tender and (iv)
specify the name in which any such Old Notes are to be registered, if different
from that of the Depositor. All questions as to the validity, form and
eligibility (including time of receipt) of such withdrawal notices will be
determined by the Company, whose determination shall be final and binding on all
parties. Any Old Notes so withdrawn will be deemed not to have been validly
tendered for purposes of the Exchange Offer, and no New Notes will be issued
with respect thereto unless the Old Notes so withdrawn are validly retendered.
Any Old Notes that have been tendered but which are not accepted for exchange
will be returned to the holder thereof without cost to such holder as soon as
practicable after withdrawal, rejection of tender or termination of the Exchange
Offer. Properly withdrawn Old Notes may be retendered by following one of the
procedures described above under "Procedures for Tendering" at any time prior to
the Expiration Date.
13
<PAGE>
Termination
Notwithstanding any other term of the Exchange Offer, the Company will
not be required to accept for exchange, or exchange New Notes for any Old Notes
not theretofore accepted for exchange, and may terminate or amend the Exchange
Offer as provided herein before the acceptance of such Old Notes if: (i) any
action or proceeding is instituted or threatened in any court or by or before
any governmental agency with respect to the Exchange Offer, which, in the
Company's judgment, might materially impair the Company's ability to proceed
with the Exchange Offer or (ii) any law, statute, rule or regulation is
proposed, adopted or enacted, or any existing law, statute, rule or regulation
is interpreted by the staff of the Commission in a manner, which, in the
Company's judgment, might materially impair the Company's ability to proceed
with the Exchange Offer.
If the Company determines that it may terminate the Exchange Offer, as
set forth above, the Company may (i) refuse to accept any Old Notes and return
any Old Notes that have been tendered to the holders thereof, (ii) extend the
Exchange Offer and retain all Old Notes tendered prior to the expiration of the
Exchange Offer, subject to the rights of such holders of tendered Old Notes to
withdraw their tendered Old Notes, or (iii) waive such termination event with
respect to the Exchange Offer and accept all properly tendered Old Notes that
have not been withdrawn. If such waiver constitutes a material change in the
Exchange Offer, the Company will disclose such change by means of a supplement
to this Prospectus that will be distributed to each registered holder of Old
Notes, and the Company will extend the Exchange Offer for a period of five to
ten business days, depending upon the significance of the waiver and the manner
of disclosure to the registered holders of the Old Notes, if the Exchange Offer
would otherwise expire during such period.
Exchange Agent
State Street Bank and Trust Company has been appointed as Exchange
Agent for the Exchange Offer. Questions and requests for assistance and requests
for additional copies of this Prospectus or of the Letter of Transmittal should
be directed to the Exchange Agent addressed as follows:
By Hand: By Mail or Overnight Courier:
State Street Bank and Trust Company State Street Bank and Trust Company
Corporate Trust Department Corporate Trust Department
Two International Place Two International Place
Boston, Massachusetts 02110 Boston, Massachusetts 02110
Attention: Sandy Wong Attention: Sandy Wong
Facsimile Transmission:
(617) 664-5290
Fees and Expenses
The expenses of soliciting tenders pursuant to the Exchange Offer will
be borne by the Company. The principal solicitation for tenders pursuant to the
Exchange Offer is being made by mail. Additional solicitations may be made by
officers and regular employees of the Company and its affiliates in person, by
telegraph or by telephone.
The Company will not make any payments to brokers, dealers or other
persons soliciting acceptances of the Exchange Offer. The Company, however, will
pay the Exchange Agent reasonable and customary fees for its services and will
reimburse the Exchange Agent for its reasonable out-of-pocket expenses in
connection therewith. The Company may also pay brokerage houses and other
custodians, nominees and fiduciaries the reasonable out-of-pocket expenses
incurred by them in forwarding copies of this Prospectus, Letters of Transmittal
and related documents to the beneficial owners of the Old Notes and in handling
or forwarding tenders for exchange.
The expenses to be incurred in connection with the Exchange Offer,
including fees and expenses of the Exchange Agent and Trustee and accounting and
legal fees, will be paid by the Company.
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The Company will pay all transfer taxes, if any, applicable to the
exchange of Old Notes pursuant to the Exchange Offer. If, however, certificates
representing New Notes or Old Notes not tendered or accepted for exchange are to
be delivered to, or are to be registered or issued in the name of, any person
other than the registered holder of the Old Notes tendered, or if tendered Old
Notes are registered in the name of any person other than the person signing the
Letter of Transmittal, or if a transfer tax is imposed for any reason other than
the exchange of Old Notes pursuant to the Exchange Offer, then the amount of any
such transfer taxes (whether imposed on the registered holder or any other
persons) will be payable by the tendering holder. If satisfactory evidence of
payment of such taxes or exemption therefrom is not submitted with the Letter of
Transmittal, the amount of such transfer taxes will be billed directly to such
tendering holder.
Accounting Treatment
The New Notes will be recorded at the same carrying value as the Old
Notes, which is face value, as reflected in the Company's accounting records on
the date of the exchange. Accordingly, no gain or loss for accounting purposes
will be recognized by the Company upon the consummation of the Exchange Offer.
The expenses of the Exchange Offer will be amortized by the Company over the
term of the New Notes under generally accepted accounting principles.
DESCRIPTION OF THE NEW NOTES
The New Notes are to be issued under an Indenture and a Supplemental
Indenture, each dated as of December 18, 1997 (collectively, the "Indenture"),
between the Company and State Street Bank and Trust Company (the "Trustee"). The
terms of the New Notes include those stated in the Indenture and those made a
part of the Indenture by reference to the Trust Indenture Act of 1939 (the
"Trust Indenture Act"). The New Notes are subject to all such terms, and holders
of the Old Notes and the New Notes are referred to the Indenture and the Trust
Indenture Act for a statement thereof. The Indenture has been filed with the
Commission and is incorporated by reference herein and is available for
inspection at the corporate trust office of the Trustee at Two International
Place, Boston, Massachusetts 02110. The statements made hereunder relating to
the Indenture and the New Notes to be issued thereunder are summaries of certain
provisions thereof, do not purport to be complete and are subject to, and are
qualified in their entirety by reference to, all provisions of the Indenture and
such New Notes. All section references appearing herein are to sections of the
Indenture, and capitalized terms used but not defined herein shall have the
respective meanings set forth in the Indenture.
General
The New Notes will be limited to an aggregate principal amount of
$150,000,000 and will mature, unless previously redeemed, on December 18, 2002.
The New Notes will be issued in registered form, without coupons, and in
denominations of $100,000 and integral multiples of $1,000 in excess thereof.
The New Notes will be senior unsecured obligations of the Company and will rank
equally with each other and with all other unsecured and unsubordinated
indebtedness of the Company from time to time outstanding. The New Notes will be
effectively subordinated to mortgages and other secured indebtedness of the
Company and to indebtedness and other liabilities of any Subsidiaries (as
defined below). Accordingly, such prior indebtedness will have to be satisfied
in full before holders of the New Notes will be able to realize any value from
the secured or indirectly held properties.
As of March 1, 1998, the total outstanding indebtedness of the Company
and its Subsidiaries (including net borrowings made for acquisitions during the
period of October 1, 1997 through March 1, 1998 under the Bank Credit Facility)
was approximately $758 million, of which approximately 97% was unsecured, and
the indebtedness of the Company's Subsidiaries was $26 million. In addition, the
Company's Subsidiaries (with certain exceptions) are guarantors of the Company's
Bank Credit Facility. The Bank Credit Facility is currently an unsecured
revolving credit facility in the amount of $450 million. The Company and its
Subsidiaries may incur additional indebtedness, including secured indebtedness,
subject to the provisions described below under "--Certain
Covenants--Limitations on Incurrence of Debt."
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Except as described under "--Merger, Consolidation or Sale" and
"--Certain Covenants" below, the Indenture does not contain any other provisions
that would limit the ability of the Company to incur indebtedness or that would
afford holders of the New Notes protection in the event of (i) a highly
leveraged or similar transaction involving the Company or any affiliate of the
Company, (ii) a change of control, or (iii) a reorganization, restructuring,
merger or similar transaction involving the Company that may adversely affect
the holders of the New Notes. In addition, subject to the limitations set forth
under "--Merger, Consolidation or Sale" and "--Certain Covenants" below, the
Company may, in the future, enter into certain transactions such as the sale of
all or substantially all of its assets or the merger or consolidation of the
Company that would increase the amount of the Company's indebtedness or
substantially reduce or eliminate the Company's assets, which may have an
adverse effect on the Company's ability to service its indebtedness, including
the New Notes. The Company and its management have no present intention of
engaging in a highly leveraged or similar transaction involving the Company.
Interest
Interest on the New Notes will accrue at the rate of 6 3/4% per annum.
Interest on the New Notes will be payable semi-annually in arrears on June 18
and December 18 commencing on June 18, 1998 (each, an "Interest Payment Date"),
and on the date of maturity or earlier redemption of the New Notes, as the case
may be (the "Maturity Date"). The interest so payable will be paid to the person
(the "Holder") in whose name the applicable New Note is registered at the close
of business on the date (whether or not a Business Day) 15 calendar days
preceding the applicable Interest Payment Date or the Maturity Date (each, a
"Regular Record Date"). Interest on the New Notes will accrue from the most
recent date to which the interest has been paid or, if no interest has been
paid, from the date of original issuance. Interest will be computed on the basis
of a 360-day year comprised of twelve 30-day months. The New Notes will be
payable both as to principal and interest at the corporate trust office of the
Trustee, initially at Two International Place, Boston, Massachusetts 02110, or,
at the option of the Company, payment of interest may be made by check mailed to
the Holders of New Notes at their addresses set forth in the register of Holders
of New Notes.
Optional Redemption of New Notes
Until the third month prior to their stated Maturity Date, the New
Notes will be subject to redemption at any time at the option of the Company, in
whole or in part, upon not less than 30 nor more than 60 days' notice, at 100%
of the outstanding principal amount thereof, plus accrued and unpaid interest to
but excluding the applicable redemption date, plus the Make-Whole Amount. On and
after the third month prior to the stated Maturity Date for the New Notes, the
New Notes will be subject to redemption at any time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 days'
notice, at 100% of the outstanding principal amount thereof, plus accrued and
unpaid interest to but excluding the applicable redemption date.
The Company is not required to make sinking fund or redemption payments
with respect to the New Notes.
"Make-Whole Amount" means, in connection with any optional redemption
or accelerated payment of any New Notes, the excess, if any, of (i) the
aggregate present value as of the date of such redemption or accelerated payment
of each dollar of principal being redeemed or paid and the amount of interest
(exclusive of interest accrued to the date of redemption or accelerated payment)
that would have been payable in respect of such dollar if such redemption or
accelerated payment had not been made, determined by discounting, on a
semiannual basis, such principal and interest at the Reinvestment Rate
(determined on the third Business Day preceding the date such notice of
redemption is given or declaration of acceleration is made) from the respective
dates on which such principal and interest would have been payable if such
redemption or accelerated payment had not been made, over (ii) the aggregate
principal amount of the New Notes being redeemed or paid.
"Reinvestment Rate" means 0.25% (twenty-five one hundredths of one
percent) plus the yield on treasury securities at constant maturity under the
heading "Week Ending" published in the Statistical Release under the caption
"Treasury Constant Maturities" for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the payment date of the
principal being redeemed or paid. If no maturity exactly corresponds to such
maturity, yields for the two published maturities most closely corresponding to
such maturity
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shall be calculated pursuant to the immediately preceding sentence and the
Reinvestment Rate shall be interpolated or extrapolated from such yields on a
straight-line basis, rounding in each of such relevant periods to the nearest
month. For purposes of calculating the Reinvestment Rate, the most recent
Statistical Release published prior to the date of determination of the
Make-Whole Amount shall be used.
"Statistical Release" means the statistical release designated "H.
15(519)" or any successor publication which is published weekly by the Federal
Reserve System and which establishes yields on actively traded United States
government securities adjusted to constant maturities or, if such statistical
release is not published at the time of any determination under the Indenture,
then any publicly available source of similar market data which shall be
designated by the Company.
Certain Covenants
Existence. Except as permitted under "--Merger, Consolidation or Sale"
below, the Company will be required to do or cause to be done all things
necessary to preserve and keep in full force and effect its corporate existence,
rights (charter and statutory) and franchises; provided, however, that the
Company shall not be required to preserve any right or franchise if it
determines that the preservation thereof is no longer desirable in the conduct
of its business.
Provision of Financial Information. Whether or not the Company is
subject to Section 13 or 15(d) of the Exchange Act, the Company will, to the
extent permitted under the Exchange Act, file with the Commission the annual
reports, quarterly reports and other documents which the Company would have been
required to file with the Commission pursuant to such Section 13 or 15(d) (the
"Financial Statements") if the Company were so subject, such documents to be
filed with the Commission on or prior to the respective dates (the "Required
Filing Dates") by which the Company would have been so required to file if the
Company were so subject. The Company will also in any event (i) within 15 days
of each Required Filing Date (a) transmit by mail to all Holders of the New
Notes, as their names and addresses appear in the Company's register of holders
of New Notes, without cost to the Holders, copies of the annual reports and
quarterly reports which the Company would have been required to file with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act if the Company
were subject to such Sections, and (b) file with the Trustee copies of the
annual reports, quarterly reports and other documents which the Company would
have been required to file with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act if the Company were subject to such Sections, and (ii) if
filing such documents by the Company with the Commission is not permitted under
the Exchange Act, promptly upon written request and payment of the reasonable
cost of duplication and delivery, supply copies of such documents to any
prospective holder of the New Notes.
Limitations on Incurrence of Debt. The Company will not, and will not
permit any Subsidiary to, incur any Debt (as defined below) if, immediately
after giving effect to the incurrence of such additional Debt and the
application of the proceeds thereof, the aggregate principal amount of all
outstanding Debt of the Company and its Subsidiaries on a consolidated basis
determined in accordance with GAAP is greater than 60% of the sum ("Adjusted
Total Assets") of (without duplication) (i) the Total Assets (as defined below)
of the Company and its Subsidiaries as of the end of the calendar quarter
covered in the Company's Annual Report on Form 10-K, or the Quarterly Report on
Form 10-Q, as the case may be, most recently filed with the Commission (or, if
such filing is not permitted under the Exchange Act, with the Trustee) prior to
the incurrence of such additional Debt and (ii) the purchase price of any real
estate assets or mortgages receivable acquired, and the amount of any securities
offering proceeds received (to the extent that such proceeds were not used to
acquire real estate assets or mortgages receivable or used to reduce Debt), by
the Company or any Subsidiary since the end of such calendar quarter, including
those proceeds obtained in connection with the incurrence of such additional
Debt.
In addition to the foregoing limitations on the incurrence of Debt, the
Company will not, and will not permit any Subsidiary to, incur any Secured Debt
(as defined below) if, immediately after giving effect to the incurrence of such
additional Secured Debt and the application of the proceeds thereof, the
aggregate principal amount of all outstanding Secured Debt of the Company and
its Subsidiaries on a consolidated basis is greater than 40% of Adjusted Total
Assets.
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In addition to the foregoing limitations on the Incurrence of Debt, the
Company will not, and will not permit any Subsidiary to, incur any Debt if the
ratio of Consolidated Income Available for Debt Service (as defined below) to
the Annual Debt Service (as defined below) for the four consecutive fiscal
quarters most recently ended prior to the date on which such additional Debt is
to be incurred shall have been less than 1.5x, on a pro forma basis after giving
effect thereto and to the application of the proceeds therefrom, and calculated
on the assumption that (i) such Debt and any other Debt incurred by the Company
and its Subsidiaries since the first day of such four-quarter period and the
application of the proceeds therefrom, including to refinance other Debt, had
occurred at the beginning of such period; (ii) the repayment or retirement of
any other Debt by the Company and its Subsidiaries since the first date of such
four-quarter period had been repaid or retired at the beginning of such period
(except that, in making such computation, the amount of Debt repaid under any
revolving credit facility shall be computed based upon the average daily balance
of such Debt during such period); (iii) in the case of Acquired Debt (as defined
below) or Debt incurred in connection with any acquisition since the first day
of such four-quarter period, the related acquisition had occurred as of the
first day of such period with appropriate adjustments with respect to such
acquisition being included in such pro forma calculation; and (iv) in the case
of any acquisition or disposition by the Company or its Subsidiaries of any
asset or group of assets since the first day of such four-quarter period,
whether by merger, stock purchase or sale, or asset purchase or sale, such
acquisition or disposition or any related repayment of Debt had occurred as of
the first day of such period with the appropriate adjustments with respect to
such acquisition or disposition being included in such as adjusted calculation.
Maintenance of Total Unencumbered Assets. The Company and its
Subsidiaries will maintain Total Unencumbered Assets (as defined below) of not
less than 200% of the aggregate outstanding principal amount of the Unsecured
Debt (as defined below) of the Company and its Subsidiaries on a consolidated
basis.
As used herein:
"Acquired Debt" means Debt of a Person (i) existing at the time such
Person becomes a Subsidiary or (ii) assumed in connection with the acquisition
of assets from such Person, in each case, other than Debt incurred in connection
with, or in contemplation of, such Person becoming a Subsidiary or such
acquisition. Acquired Debt shall be deemed to be incurred on the date of the
related acquisition of assets from any Person or the date the acquired Person
becomes a Subsidiary.
"Annual Debt Service" as of any date means the maximum amount which is
expensed in any 12-month period for interest on Debt of the Company and its
Subsidiaries.
"Capital Stock" means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participation or other ownership
interests (however designated) of such Person and any rights (other than debt
securities convertible into or exchangeable for capital stock), warrants or
options to purchase any thereof.
"Consolidated Income Available for Debt Service" for any period means
Earnings from Operations (as defined below) of the Company and its Subsidiaries
plus amounts which have been deducted, and minus amounts which have been added,
for the following (without duplication): (i) interest on Debt of the Company and
its Subsidiaries, (ii) provision for taxes of the Company and its Subsidiaries
based on income, (iii) amortization of debt discount and deferred financing
costs, (iv) provisions for gains and losses on properties and property
depreciation and amortization, (v) the effect of any noncash charge resulting
from a change in accounting principles in determining Earnings from Operations
for such period and (vi) amortization of deferred charges.
"Debt" of the Company or any Subsidiary means, without duplication, any
indebtedness of the Company or any Subsidiary, whether or not contingent, in
respect of (i) borrowed money or evidenced by bonds, notes, debentures or
similar instruments, (ii) indebtedness for borrowed money secured by any
encumbrance existing on property owned by the Company or any Subsidiary, (iii)
the reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued (other than letters of credit issued to
provide credit enhancement or support with respect to other indebtedness of the
Company or any Subsidiary otherwise reflected as Debt hereunder) or amounts
representing the balance deferred and unpaid of the purchase price of any
property or services, except any such balance that constitutes an accrued
expense or trade payable, or all conditional sale obligations or obligations
under any title retention agreement, (iv) the principal amount of all
obligations of the
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Company or any Subsidiary with respect to redemption, repayment or other
repurchase of any Disqualified Stock, or (v) any lease of property by the
Company or any Subsidiary as lessee which is reflected on the Company's
consolidated balance sheet as a capitalized lease in accordance with GAAP, to
the extent, in the case of items of indebtedness under (i) through (iii) above,
that any such items (other than letters of credit) would appear as a liability
on the Company's consolidated balance sheet in accordance with GAAP, and also
includes, to the extent not otherwise included, any obligation by the Company or
any Subsidiary to be liable for, or to pay, as obligor, guarantor or otherwise
(other than for purposes of collection in the ordinary course of business), Debt
of another Person (other than the Company or any Subsidiary) (it being
understood that Debt shall be deemed to be incurred by the Company or any
Subsidiary whenever the Company or such Subsidiary shall create, assume,
guarantee or otherwise become liable in respect thereof).
"Disqualified Stock" means, with respect to any Person, any Capital
Stock of such Person which by the terms of such Capital Stock (or by the terms
of any security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (i) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise
(other than Capital Stock which is redeemable solely in exchange for common
stock or shares), (ii) is convertible into or exchangeable or exercisable for
Debt or Disqualified Stock, or (iii) is redeemable at the option of the holder
thereof, in whole or in part (other than Capital Stock which is redeemable
solely in exchange for common stock or shares), in each case on or prior to the
stated maturity of the New Notes.
"Earnings from Operations" for any period means net earnings excluding
gains and losses on sales of investments, extraordinary items and property
valuation losses, as reflected in the financial statements of the Company and
its Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP.
"Secured Debt" means Debt secured by any mortgage, lien, charge, pledge
or security interest of any kind.
"Subsidiary" means any corporation or other entity of which a majority
of (i) the voting power of the voting equity securities or (ii) the outstanding
equity interests of which are owned, directly or indirectly, by the Company or
one or more other Subsidiaries of the Company. For the purposes of this
definition, "voting equity securities" means equity securities having voting
power for the election of directors, whether at all times or only so long as no
senior class of security has such voting power by reason of any contingency.
"Total Assets" as of any date means the sum of (i) the Undepreciated
Real Estate Assets and (ii) all other assets of the Company and its Subsidiaries
determined in accordance with GAAP (but excluding accounts receivable and
intangibles).
"Total Unencumbered Assets" means the sum of (i) those Undepreciated
Real Estate Assets not subject to an encumbrance for borrowed money and (ii) all
other assets of the Company and its Subsidiaries not subject to an encumbrance
for borrowed money determined in accordance with GAAP (but excluding accounts
receivable and intangibles).
"Undepreciated Real Estate Assets" as of any date means the cost
(original cost plus capital improvements) of real estate assets of the Company
and its Subsidiaries on such date, before depreciation and amortization
determined on a consolidated basis in accordance with GAAP.
"Unsecured Debt" means Debt which is not secured by any of the
properties of the Company or any Subsidiary.
Merger, Consolidation or Sale
The Company may consolidate with, or sell, lease or convey all or
substantially all of its assets to, or merge with or into, any other entity,
provided that (i) either the Company shall be the continuing entity, or the
successor entity (if other than the Company) formed by or resulting from any
such consolidation or merger or which shall have received the transfer of such
assets is a Person organized and existing under the laws of the United States or
any state thereof and shall expressly assume the due and punctual payment of the
principal of (and premium or Make-
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Whole Amount, if any) and any interest on all of the New Notes and the due and
punctual performance and observance of all of the covenants and conditions
contained in the Indenture to be performed by the Company; (ii) immediately
after giving effect to such transaction and treating any indebtedness which
becomes an obligation of the Company or any Subsidiary as a result thereof as
having been incurred by the Company or such Subsidiary at the time of such
transaction, no Event of Default under the Indenture, and no event which after
notice or the lapse of time, or both, would become such an Event of Default,
shall have occurred and be continuing; and (iii) an Officers' Certificate and
legal opinion covering such conditions shall be delivered to the Trustee.
Events of Default, Notice and Waiver
The Indenture provides that the following events are "Events of
Default" with respect to the New Notes: (i) default for 30 days in the payment
of any installment of interest payable on any New Note when due and payable;
(ii) default in the payment of the principal of (or premium or Make-Whole
Amount, if any, on) any New Note when due and payable; (iii) default in the
performance, or breach, of any covenant of the Company contained in the
Indenture (other than a covenant added to the Indenture solely for the benefit
of a series of Debt Securities (as defined) other than the New Notes), which
continues for 60 days after written notice as provided in the Indenture; (iv)
default under any bond, debenture, note, 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 (or by any Subsidiary, the
repayment of which the Company has guaranteed or for which the Company is
directly responsible or liable as obligor or guarantor) having an aggregate
principal amount outstanding of at least $20,000,000, whether such indebtedness
now exists or shall hereafter be incurred or created, which default shall have
resulted in such indebtedness 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 written notice 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 New Notes, as provided in the
Indenture; or (v) certain events of bankruptcy, insolvency or reorganization, or
court appointment of a receiver, liquidator or trustee of the Company or any
Significant Subsidiary or for all or substantially all of either of its
property. "Significant Subsidiary" means any Subsidiary which is a "significant
subsidiary" (within the meaning of Regulation S-X, promulgated under the
Securities Act) of the Company.
See "Description of Indenture--Events of Default, Notice and Waiver"
below for a description of rights, remedies and other matters relating to Events
of Default.
Discharge, Defeasance and Covenant Defeasance
The provisions of the Indenture relating to defeasance and covenant
defeasance described under "Description of Indenture--Discharge, Defeasance and
Covenant Defeasance" below will apply to the New Notes.
Book-Entry System
Old Notes were represented initially by a permanent global certificate
in fully registered form without interest coupons (the "Global Note") and were
registered in the name of a nominee of DTC and deposited with DTC or its
custodian. The Global Note was subject to certain restrictions on transfer.
Beneficial interests in the Global Note may be transferred to a person who takes
delivery in the form of an interest in a single global certificate in fully
registered form without interest coupons, whether before, on or after such 40th
day, only upon receipt by the Trustee of a written certification from the
transferor to the effect that such transfer is being made in accordance with
Rule 903 or 904 of Regulation S or Rule 144 under the Securities Act (an
"Unrestricted Global Note Certification"). Any beneficial interest in one of the
global notes that is transferred to a person who takes delivery in the form of
an interest in the other global note will, upon transfer, cease to be an
interest in such global note and will become an interest in the other global
note and, accordingly, will thereafter be subject to all transfer restrictions
and other procedures and restrictions applicable to beneficial interests in such
other global note for as long as it remains such an interest.
The Global Note, to the extent directed by the holders thereof in their
Letters of Transmittal, will be exchanged through book-entry electronic transfer
for a Global Note (the "New Global Note") in definitive fully-
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registered form without interest coupons registered in the name of a nominee of
DTC and held by the Trustee as custodian. Except in the limited circumstances
described below, owners of beneficial interests in the New Global Note will not
be entitled to receive physical delivery of Notes.
Upon the issuance of the New Global Note, DTC or its custodian will
credit, in its internal system, the respective principal amount of the
individual beneficial interests represented by the New Global Note to the
accounts of persons who have accounts with DTC. Ownership of beneficial interest
in the New Global Note will be limited to persons who have accounts with DTC
("DTC Participants") or persons who hold interests through DTC Participants.
Ownership of beneficial interests in the New Global Note will be shown on, and
the transfer of that ownership will be effected only through, records maintained
by DTC or its nominee (with respect to interests of DTC Participants) and the
records of DTC Participants (with respect to interests of persons other than DTC
Participants).
Investors may hold their interests in the New Global Note through
Morgan Guaranty Trust Company of New York, Brussels Office, as operator of the
Euroclear System ("Euroclear") or Citibank, N.A., as depositary for Cedel S.A.
("Cedel"), if they are participants in such systems, or indirectly through
organizations that are participants in such systems. Investors may also hold
such interests through organizations other than Euroclear and Cedel that are
participants in the DTC system. Euroclear and Cedel will hold interests in the
New Global Note on behalf of their account holders through customers' securities
accounts in their respective names on the books of their respective
depositaries, which in turn will hold such interests in the New Global Note in
customers' securities accounts in the depositaries' names on the books of DTC.
Investors may also hold their interests in the New Global Note directly through
DTC, if they are DTC Participants, or indirectly through organizations which are
DTC Participants.
Payments of the principal of and interest on the New Global Note will
be made to DTC or its nominee as the registered owner thereof. The Company will
not have any responsibility or liability for any aspect of the records relating
to or payments made on account of beneficial ownership interests in the New
Global Note or for maintaining, supervising or reviewing any records relating to
such beneficial ownership interests.
The Company expects that DTC or its nominee, upon receipt of any
payment of principal or interest in respect of the New Global Note representing
any New Notes held by it or its nominee, will credit DTC Participants' accounts
with payments in amounts proportionate to their respective beneficial interests
in the principal amount of the New Global Note as shown on the records of DTC or
its nominee. The Company also expects that payments by DTC Participants to
owners of beneficial interests in the New Global Note held through such DTC
Participants will be governed by standing instructions and customary practices,
as is now the case with securities held for the accounts of customers registered
in the names of nominees for such customers. Such payments will be the
responsibility of such DTC Participants.
If DTC is at any time unwilling or unable to continue as depositary or
is ineligible to act as depositary and a successor depositary is not appointed
by the Company within 90 days after the Company is notified by DTC or becomes
aware of such condition, the Company will issue New Notes in definitive form in
exchange for the New Global Note representing the New Notes.
Individual definitive New Notes will not be eligible for clearing and
settlement through Euroclear, Cedel or DTC.
Same-Day Settlement and Payment
All payments of principal and interest in respect of the New Notes will
be made by the Company in immediately available funds.
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DESCRIPTION OF INDENTURE
The New Notes will be issued pursuant to the Indenture and the
supplement relating thereto, which was entered into between the Company and the
Trustee. The Indenture provides for the issuance of multiple series of debt
securities, including the New Notes (each "Debt Securities") in accordance with
the terms thereof and the applicable supplemental indenture. The statements made
hereunder relating to the Indenture and the Debt Securities to be issued
thereunder are summaries and do not purport to be complete and are subject to,
and are qualified in their entirety by reference to, all provisions of the
Indenture and such Debt Securities. Terms of the supplemental indenture with
respect to the New Notes, certain of which are described above under
"Description of the New Notes," supersede conflicting provisions of the
Indenture described below, insofar as applicable to the New Notes. The
description of certain provisions of the Indenture described below does not
purport to be complete, and reference is made to the definitive Indenture and
the supplemental indenture relating to the New Notes, copies of which are
available upon request from the Company.
General
The Debt Securities may be issued without limit as to aggregate
principal amount, in one or more series, in each case as established from time
to time in or pursuant to authority granted by a resolution of the Board of
Trustees of the Company or as established in one or more indentures supplemental
to the Indenture. All Debt Securities of one series need not be issued at the
same time and, unless otherwise provided, a series may be reopened, without the
consent of the holders of the Debt Securities of such series, for issuances of
additional Debt Securities of such series.
It is anticipated that any Indenture will provide that the Company may,
but need not, designate more than one Trustee thereunder, each with respect to
one or more series of Debt Securities. Any Trustee under the Indenture may
resign or be removed with respect to one or more series of Debt Securities, and
a successor Trustee may be appointed to act with respect to such series. In the
event that two or more persons are acting as Trustee with respect to different
series of Debt Securities, each such Trustee shall be a trustee of a trust under
the Indenture separate and apart from the trust administered by any other
Trustee, and, except as otherwise indicated herein, any action described herein
to be taken by the Trustee may be taken by each such Trustee with respect to,
and only with respect to, the one or more series of Debt Securities for which it
is Trustee under the Indenture.
Except as described under "Description of the New Notes--Certain
Covenants" and "Description of New Notes--Merger, Consolidation or Sale," and
"The Exchange Offer," the Indenture does not contain any other provisions that
limit the ability of the Company to incur indebtedness or that afford holders of
the Debt Securities protection in the event of a highly leveraged or similar
transaction involving the Company. However, restrictions on ownership and
transfers of the Company's capital stock, designed to preserve its status as a
REIT, may act to prevent or hinder a change of control.
Denominations, Interest, Registration and Transfer
Any interest not punctually paid or duly provided for on any interest
payment date with respect to a Debt Security ("Defaulted Interest") will
forthwith cease to be payable to the holder on the applicable regular record
date and may either be paid to the person in whose name such Debt Security is
registered at the close of business on a special record date (the "Special
Record Date") for the payment of such Defaulted Interest to be fixed by the
Trustee, notice whereof shall be given to the holder of such Debt Security not
less than 10 days prior to such Special Record Date, or may be paid at any time
in any other lawful manner, all as more completely described in the Indenture.
Subject to certain limitations imposed upon Debt Securities issued in
book-entry form, the Debt Securities of any series will be exchangeable for
other Debt Securities of the same series and of a like aggregate principal
amount and tenor of different authorized denominations upon surrender of such
Debt Securities at the corporate trust office of the Trustee. In addition,
subject to certain limitations imposed upon Debt Securities issued in book-entry
form, the Debt Securities of any series may be surrendered for conversion or
registration of transfer thereof at the corporate trust office of the Trustee.
Every Debt Security surrendered for conversion, registration of transfer or
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exchange shall be duly endorsed or accompanied by a written instrument of
transfer. No service charge will be made for any registration of transfer or
exchange of any Debt Securities, but the Trustee or the Company may require
payment of a sum sufficient to cover any tax or other governmental charge
payable in connection therewith. The Company may at any time rescind the
designation of any transfer agent designated by the Company with respect to any
series of Debt Securities or approve a change in the location through which any
such transfer agent acts, except that the Company will be required to maintain a
transfer agent in each place of payment for such series. The Company may at any
time designate transfer agents in addition to the Trustee with respect to any
series of Debt Securities.
Neither the Company nor the Trustee shall be required to (i) issue,
register the transfer of or exchange Debt Securities of any series during a
period beginning at the opening of business 15 days before any selection of Debt
Securities of that series to be redeemed and ending at the close of business on
(a) if such Debt Securities are issuable only as registered securities, the day
of the mailing of the relevant notice of redemption and (b) if such Debt
Securities are issuable as bearer securities, the day of the first publication
of the relevant notice of redemption or, if such Debt Securities are also
issuable as registered securities and there is no publication, the mailing of
the relevant notice of redemption, or (ii) to register the transfer of or
exchange any registered security so selected for redemption in whole or in part,
except, in the case of any registered security to be redeemed in part, the
portion thereof not to be redeemed, or (iii) to exchange any bearer security so
selected for redemption except that such a bearer security may be exchanged for
a registered security of that series and like tenor; provided that such
registered security shall be simultaneously surrendered for redemption, or (iv)
to issue, register the transfer of or exchange any Debt Security which has been
surrendered for repayment at the option of the holder, except the portion, if
any, of such Debt Security not to be so repaid.
Events of Default, Notice and Waiver
The Indenture will provide that the following events are "Events of
Default" with respect to any series of Debt Securities issued thereunder: (a)
default for 30 days in the payment of any installment on any Debt Security of
such series; (b) default in the payment of the principal of (or premium, if any,
on) any Debt Security of such series at its maturity; (c) default in making any
sinking fund payments as required for any Debt Security of such series; (d)
default in the performance of any other covenant of the Company contained in the
Indenture (other than a covenant added to the Indenture solely for the benefit
of a series of Debt Securities issued thereunder other than such series), such
default having continued for 60 days after written notice as provided in the
Indenture; (e) default in the payment of an aggregate principal amount exceeding
$20,000,000 of any evidence of indebtedness of the Company or any mortgage,
indenture or other instrument under which such indebtedness is issued or by
which such indebtedness is secured, such default having occurred after the
expiration of any applicable grace period and having resulted in the
acceleration of the maturity of such indebtedness, but only if such indebtedness
is not discharged or such acceleration is not rescinded or annulled; (f) certain
events of bankruptcy, insolvency or reorganization, or court appointment of a
receiver, liquidator or trustee of the Company or any Significant Subsidiary (as
hereinafter defined) or any of their respective property; and (g) any other
event of default provided with respect to a particular series of Debt
Securities. The term "Significant Subsidiary" means each significant subsidiary
(as defined in Regulation S-X promulgated under the Securities Act) of the
Company.
If an Event of Default (other than an Event of Default described in
clause (f) above) under the Indenture with respect to Debt Securities of any
series at the time outstanding occurs and is continuing, then in every such case
the Trustee or the holders of not less than a majority in principal amount of
the outstanding Debt Securities of that series may declare the principal amount
(or, if the Debt Securities of that series are Debt Securities that provide for
less than the entire principal amount thereof to be payable upon declaration of
acceleration of the maturity thereof (an "Original Issue Discount Security") or
indexed securities, such portion of the principal amount as may be specified in
the terms thereof) of all of the Debt Securities of that series to be due and
payable immediately by written notice thereof to the Company (and to the Trustee
if given by the holders). If an Event of Default described in clause (f) above
with respect to the Debt Securities of any series at the time outstanding shall
occur, the principal amount of all the Debt Securities of that series (or, in
the case of any such Original Issue Discount Security or other Debt Security,
such specified amount) will automatically, and without any action by the Trustee
or any holder of such series of Debt Securities, become immediately due and
payable. However, at any time after such a declaration of acceleration with
respect to Debt Securities of such series (or of all Debt Securities then
outstanding under the
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Indenture, as the case may be) has been made, but before a judgment or decree
for payment of the money due has been obtained by the Trustee, the holders of
not less than a majority in principal amount of outstanding Debt Securities of
such series (or of all Debt Securities then outstanding under the Indenture, as
the case may be) may rescind and annul such declaration and its consequences if
(i) the Company shall have deposited with the Trustee all required payments of
the principal of (and premium, if any) and interest on the Debt Securities of
such series (or of all Debt Securities then outstanding under the Indenture, as
the case may be), plus certain fees, expenses, disbursements and advances of the
Trustee, and (ii) all Events of Default, other than the non-payment of
accelerated principal (or specified portion thereof), or premium, if any, or
interest on the Debt Securities of such series (or of all Debt Securities then
outstanding under the Indenture, as the case may be) have been cured or waived
as provided in the Indenture. The Indenture will also provide that the holders
of not less than a majority in principal amount of the outstanding Debt
Securities of any series (or of all Debt Securities then outstanding under the
Indenture, as the case may be) may waive any past default with respect to such
series and its consequences, except a default (i) in the payment of the
principal of (or premium, if any) or interest on any Debt Security of such
series or (ii) in respect of a covenant or provision contained in the Indenture
that cannot be modified or amended without the consent of the holder of each
outstanding Debt Security affected thereby.
The Trustee will be required to give notice to the holders of Debt
Securities within 90 days of a default under the Indenture unless such default
has been cured or waived; provided, however, that the Trustee may withhold
notice to the holders of any series of Debt Securities of any default with
respect to such series (except a default in the payment of the principal of (or
premium, if any) or interest on any Debt Security of such series or in the
payment of any sinking fund installment in respect of any Debt Security of such
series) if specified responsible officers of the Trustee consider such
withholding to be in the interest of such holders.
The Indenture will provide that no holders of Debt Securities of any
series may institute any proceedings, judicial or otherwise, with respect to the
Indenture or for any remedy thereunder, except in the case of failure of the
Trustee, for 60 days, to act after it has received a written request to
institute proceedings in respect of an event of default from the holders of not
less than a majority in principal amount of the outstanding Debt Securities of
such series, as well as an offer of reasonable indemnity. This provision will
not prevent, however, any holder of Debt Securities from instituting suit for
the enforcement of payment of the principal of (and premium, if any) and
interest on such Debt Securities at the respective due dates thereof.
Subject to provisions in the Indenture relating to its duties in case
of default, the Trustee will not be under any obligation to exercise any of its
rights or powers under the Indenture at the request or direction of any holders
of any series of Debt Securities then outstanding under the Indenture, unless
such holders shall have offered to the Trustee reasonable security or indemnity.
The holders of not less than a majority in principal amount of the outstanding
Debt Securities of any series (or of all Debt Securities then outstanding under
the Indenture, as the case may be) shall have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or of exercising any trust or power conferred upon the Trustee.
However, the Trustee may refuse to follow any direction which is in conflict
with any law or the Indenture, which may involve the Trustee in personal
liability or which may be unduly prejudicial to the holders of Debt Securities
of such series not joining therein.
The Company will be required to deliver to the Trustee annually a
certificate, signed by one of several specified officers of the Company, stating
whether or not such officer has knowledge of any default under the Indenture
and, if so, specifying each such default and the nature and status thereof.
Modification of the Indenture
Modifications and amendments of the Indenture will be permitted to be
made only with the consent of the holders of not less than a majority in
principal amount of all outstanding Debt Securities or series of outstanding
Debt Securities which are affected by such modification or amendment; provided,
however, that no such modification or amendment may, without the consent of the
holder of each such Debt Security affected thereby, (i) change the stated
maturity of the principal of, or any installment of interest (or premium, if
any) on any such Debt Security; (ii) reduce the principal amount of, or the rate
or amount of interest on, or any premium payable on redemption of, any such Debt
Security, or reduce the amount of principal of an Original Issue Discount
Security that would be due
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and payable upon declaration of acceleration of the maturity thereof or would be
provable in bankruptcy, or adversely affect any right of repayment of the holder
of any such Debt Security; (iii) change the place of payment, or the coin or
currency, for payment of principal of, premium, if any, or interest on any such
Debt Security; (iv) impair the right to institute suit for the enforcement of
any payment on or with respect to any such Debt Security; (v) reduce the
above-stated percentage of outstanding Debt Securities of any series necessary
to modify or amend the Indenture, to waive compliance with certain provisions
thereof or certain defaults and consequences thereunder or to reduce the quorum
or voting requirements set forth in the Indenture; or (vi) modify any of the
foregoing provisions or any of the provisions relating to the waiver of certain
past defaults or certain covenants, except to increase the required percentage
to effect such action or to provide that certain other provisions may not be
modified or waived without the consent of the holder of such Debt Security.
The Indenture will provide that the holders of not less than a majority
in principal amount of a series of outstanding Debt Securities have the right to
waive compliance by the Company with certain covenants relating to such series
of Debt Securities in the Indenture.
Modifications and amendments of the Indenture will be permitted to be
made by the Company and the Trustee thereunder without the consent of any holder
of Debt Securities for any of the following purposes: (i) to evidence the
succession of another person to the Company as obligor under the Indenture; (ii)
to add to the covenants of the Company for the benefit of the holders of all or
any series of Debt Securities or to surrender any right or power conferred upon
the Company in the Indenture; (iii) to add events of default for the benefit of
the holders of all or any series of Debt Securities; (iv) to add or change any
provisions of the Indenture to facilitate the issuance of, or to liberalize
certain terms of, Debt Securities in bearer form, or to permit or facilitate the
issuance of Debt Securities in uncertificated form; provided that such action
shall not adversely affect the interests of the holders of the Debt Securities
in any material respect; (v) to change or eliminate any provisions of the
Indenture; provided that any such change or elimination shall become effective
only when there are no Debt Securities outstanding of any series created prior
thereto which are entitled to the benefit of such provision; (vi) to secure the
Debt Securities; (vii) to establish the form or terms of Debt Securities of any
series, including the provisions and procedures, if applicable, for the
conversion of such Debt Securities into common shares or preferred shares;
(viii) to provide for the acceptance of appointment by a successor Trustee or
facilitate the administration of the trusts under the Indenture by more than one
Trustee; (ix) to cure any ambiguity, defect or inconsistency in the Indenture;
provided that such action shall not adversely affect the interests of holders of
Debt Securities of any series in any material respect; or (x) to supplement any
of the provisions of the Indenture to the extent necessary to permit or
facilitate defeasance and discharge of any series of such Debt Securities;
provided that such action shall not adversely affect the interests of the
holders of the Debt Securities of any series in any material respect.
The Indenture will provide that in determining whether the holders of
the requisite principal amount of outstanding Debt Securities of a series have
given any request, demand, authorization, direction, notice, consent or waiver
thereunder or whether a quorum is present at a meeting of holders of Debt
Securities, (i) the principal amount of an Original Issue Discount Security that
shall be deemed to be outstanding shall be the amount of the principal thereof
that would be due and payable as of the date of such determination upon
declaration of acceleration of the maturity thereof, (ii) the principal amount
of a Debt Security denominated in a foreign currency that shall be deemed
outstanding shall be the U.S. dollar equivalent, determined on the issue date
for such Debt Security, of the principal amount (or, in the case of an Original
Issue Discount Security, the U.S. dollar equivalent on the issue date of such
Debt Security of the amount determined as provided in (i) above), (iii) the
principal amount of an indexed security that shall be deemed outstanding shall
be the principal face amount of such indexed security at original issuance,
unless otherwise provided with respect to such indexed security in the
Indenture, and (iv) Debt Securities owned by the Company or any other obligor
upon the Debt Securities or any affiliate of the Company or of such other
obligor shall be disregarded.
The Indenture will contain provisions for convening meetings of the
holders of Debt Securities of a series. A meeting may be called at any time by
the Trustee, and also, upon request, by the Company or the holders of at least
25% in principal amount of the outstanding Debt Securities of such series, in
any such case, upon notice given as provided in the Indenture. Except for any
consent that must be given by the holder of each Debt Security affected by
certain modifications and amendments of the Indenture, any resolution presented
at a meeting or adjourned meeting duly reconvened at which a quorum is present
may be adopted by the affirmative vote of the holders of a
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majority in principal amount of the outstanding Debt Securities of that series;
provided, however, that, except as referred to above, any resolution with
respect to any request, demand, authorization, direction, notice, consent,
waiver or other action that may be made, given or taken by the holders of a
specified percentage, which is less than a majority, in principal amount of the
outstanding Debt Securities of a series may be adopted at a meeting or adjourned
meeting duly reconvened at which a quorum is present by the affirmative vote of
the holders of such specified percentage in principal amount of the outstanding
Debt Securities for that series. Any resolution passed or decision taken at any
meeting of holders of Debt Securities of any series duly held in accordance with
the Indenture will be binding on all holders of Debt Securities of that series.
The quorum at any meeting called to adopt a resolution, and at any reconvened
meeting, will be persons holding or representing a majority in principal amount
of the outstanding Debt Securities of a series; provided, however, that if any
action is to be taken at such meeting with respect to a consent or waiver which
may be given by the holders of not less than a specified percentage in principal
amount of the outstanding Debt Securities of a series, the persons holding or
representing such specified percentage in principal amount of the outstanding
Debt Securities of such series will constitute a quorum.
Notwithstanding the foregoing provisions, the Indenture will provide
that if any action is to be taken at a meeting of holders of Debt Securities of
any series with respect to any request, demand, authorization, direction,
notice, consent, waiver or other action that the Indenture expressly provides
may be made, given or taken by the holders of such series and one or more
additional series: (i) there shall be no minimum quorum requirement for such
meeting and (ii) the principal amount of the outstanding Debt Securities of such
series that vote in favor of such request, demand, authorization, direction,
notice, consent, waiver or other action shall be taken into account in
determining whether such request, demand, authorization, direction, notice,
consent, waiver or other action has been made, given or taken under the
Indenture.
Discharge, Defeasance and Covenant Defeasance
The Company may discharge certain obligations to holders of any series
of Debt Securities that have not already been delivered to the Trustee for
cancellation and that either have become due and payable or will become due and
payable within one year (or scheduled for redemption within one year) by
irrevocably depositing with the Trustee, in trust, funds in such currency or
currencies, currency unit or units or composite currency or currencies in which
such Debt Securities are payable in an amount sufficient to pay the entire
indebtedness on such Debt Securities in respect of principal (and premium, if
any) and interest to the date of such deposit (if such Debt Securities have
become due and payable) or to the stated maturity or redemption date, as the
case may be.
The Indenture may provide that, if certain provisions thereof are made
applicable to the Debt Securities of or within a series pursuant to the
Indenture, the Company may elect either (i) to defease and be discharged from
any and all obligations with respect to such Debt Securities (except for the
obligation to pay additional amounts, if any, upon the occurrence of certain
events of tax, assessment or governmental charge with respect to payments on
such Debt Securities and the obligations to register the transfer or exchange of
such Debt Securities, to replace temporary or mutilated, destroyed, lost or
stolen Debt Securities, to maintain an office or agency in respect of such Debt
Securities and to hold moneys for payment in trust) ("defeasance") or (ii) to be
released from its obligations with respect to such Debt Securities under certain
sections of the Indenture (including the restrictions described under
"Description of the New Notes--Certain Covenants") and, if provided pursuant to
the Indenture, its obligations with respect to any other covenant, and any
omission to comply with such obligations shall not constitute a default or an
event of default with respect to such Debt Securities ("covenant defeasance"),
in either case upon the irrevocable deposit by the Company with the Trustee, in
trust, of an amount, in such currency or currencies, currency unit or units of
composite currency or currencies in which such Debt Securities are payable at
stated maturity, or Government Obligations (as defined below), or both,
applicable to such Debt Securities which through the scheduled payment of
principal and interest, in accordance with their terms will provide money in an
amount sufficient to pay the principal of (and premium, if any) and interest on
such Debt Securities, and any mandatory sinking fund or analogous payments
thereon, on the scheduled dates therefor.
Such a trust may be established only if, among other things, the
Company has delivered to the Trustee an opinion of counsel (as specified in the
Indenture) to the effect that the holders of such Debt Securities will not
recognize income, gain or loss for U.S. federal income tax purposes as a result
of such defeasance or covenant
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defeasance and will be subject to U.S. federal income tax on the same amounts,
in the same manner and at the same times as would have been the case if such
defeasance or covenant defeasance had not occurred.
"Government Obligations" means securities which are (i) direct
obligations of the United States of America or the government which issued the
foreign currency in which the Debt Securities of a particular series are
payable, for the payment of which its full faith and credit is pledged or (ii)
obligations of a person controlled or supervised by and acting as an agency or
instrumentality of the United States of America or such government which issued
the foreign currency in which the Debt Securities of a particular series are
payable, the payment of which is unconditionally guaranteed as a full faith and
credit obligation by the United States of America or such other government,
which, in either case, are not callable or redeemable at the option of the
issuer thereof, and shall also include a depository receipt issued by a bank or
trust company as custodian with respect to any such Government Obligation or a
specific payment of interest on or principal of any such Government Obligation
held by such custodian for the account of the holder of a depository receipt;
provided that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository
receipt from any amount received by the custodian in respect of the Government
Obligations or the specific payment of interest on or principal of the
Government Obligations evidenced by such depository receipt.
Unless otherwise provided in the applicable supplement indenture for
any series of Debt Securities (other than the New Notes), if after the Company
has deposited funds and/or Government Obligations to effect defeasance or
covenant defeasance with respect to Debt Securities of any series, (i) the
holder of a Debt Security of such series is entitled to, and does, elect
pursuant to the Indenture or the terms of such Debt Security to receive payment
in a currency, currency unit or composite currency other than that in which such
deposit has been made in respect of such Debt Security, or (ii) a Conversion
Event (as defined below) occurs in respect of the currency, currency unit or
composite currency in which such deposit has been made, the indebtedness
represented by such Debt Security shall be deemed to have been, and will be,
fully discharged and satisfied through the payment of the principal of (and
premium, if any) and interest on such Debt Security as they become due out of
the proceeds yielded by converting the amount so deposited in respect of such
Debt Security into the currency, currency unit or composite currency in which
such Debt Security becomes payable as a result of such election or such
cessation of usage based on the applicable market exchange rate. "Conversion
Event" means the cessation of use of (i) a currency, currency unit or composite
currency both by the government of the country which issued such currency and
for the settlement of transactions by a central bank or other public
institutions of or within the international banking community, (ii) the ECU both
within the European Monetary System and for the settlement of transactions by
public institutions of or within the European Communities or (iii) any currency
unit or composite currency other than the ECU for the purposes for which it was
established. Unless otherwise provided in the applicable supplemental indenture
for any series of Debt Securities (other than the New Notes), all payments of
principal of (and premium, if any) and interest on any Debt Security that is
payable in a foreign currency that ceases to be used by its government of
issuance shall be made in U.S. dollars.
In the event the Company effects covenant defeasance with respect to
any Debt Securities and such Debt Securities are declared due and payable
because of the occurrence of any event of default other than the event of
default described in clause (d) under "--Events of Default, Notice and Waiver"
above with respect to certain sections of the Indenture (which sections would no
longer be applicable to such Debt Securities) or described in clause (g) under
"--Events of Default, Notice and Waiver" with respect to any other covenant as
to which there has been covenant defeasance, the amount in such currency,
currency unit or composite currency in which such Debt Securities are payable,
and Government Obligations on deposit with the Trustee, will be sufficient to
pay amounts due on such Debt Securities at the time of their stated maturity but
may not be sufficient to pay amounts due on such Debt Securities at the time of
the acceleration resulting from such event of default. However, the Company
would remain liable to make payment of such amounts due at the time of
acceleration.
The applicable supplemental indenture for any series of Debt Securities
(other than the New Notes) may further describe the provisions, if any,
permitting such defeasance or covenant defeasance, including any modifications
to the provisions described above, with respect to the Debt Securities of or
within a particular series.
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CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following summary, which describes the principal United States
Federal income tax consequences resulting from the exchange of Old Notes for New
Notes and the ownership and disposition of New Notes, is based upon laws,
regulations, rulings and decisions now in effect, all of which are subject to
change (including changes in effective dates) or possible differing
interpretations. The following discussion deals only with Notes held as capital
assets and does not purport to deal with persons in special tax situations, such
as financial institutions, banks, insurance companies, regulated investment
companies, dealers in securities or currencies, persons holding Notes as a hedge
against currency risks or as a position in a "straddle" for tax purposes, or
persons whose functional currency is not the United States dollar. It also does
not deal with holders of the Notes other than original purchasers of the Old
Notes. Persons considering owning the Notes should consult their own tax
advisors concerning the application of United States Federal income tax laws to
their particular situations as well as any consequences of the purchase,
ownership and disposition of the Notes arising under the laws of any other
taxing jurisdiction.
As used herein, the term "U.S. Holder" means a beneficial owner of a
Note that is for United States Federal income tax purposes (i) a citizen or
resident of the United States, (ii) a corporation or partnership (or other
entity treated as a corporation or partnership for United States Federal income
tax purposes) created or organized in or under the laws of the United States or
of any political subdivision thereof (unless otherwise provided by Treasury
Regulations), (iii) an estate the income of which is subject to United States
Federal income taxation regardless of its source, (iv) a trust if a court within
the United States is able to exercise primary supervision over the
administration of the trust and one or more United States persons have the
authority to control all substantial decisions of the trust (or certain electing
trusts in existence on August 20, 1996 to the extent provided in Treasury
Regulations), or (v) any other person whose income or gain in respect of a Note
is effectively connected with the conduct of a United States trade or business.
As used herein, the term "non-U.S. Holder" means a beneficial owner of a Note
that is not a U.S. Holder.
EACH HOLDER IS STRONGLY URGED TO CONSULT ITS TAX ADVISERS REGARDING THE
FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF EXCHANGING OLD NOTES FOR
NEW NOTES AND HOLDING AND DISPOSING OF THE NEW NOTES.
Exchange Offer
An exchange of Old Notes for New Notes pursuant to the Exchange Offer
should be regarded for Federal income tax purposes as a nontaxable continuation
of the Old Notes, and a holder should have the same adjusted basis and holding
period in the New Notes upon receipt as it had in the Old Notes immediately
before the exchange.
The Notes
For U.S. Federal income tax purposes, each Note will be treated as
indebtedness issued by the Company.
U.S. Holders
Interest. Interest on a Note will generally be includible in the gross
income of a U.S. Holder as ordinary interest income at the time the interest is
received or when it accrues in accordance with the U.S. Holder's regular method
of tax accounting. Such interest will be treated as U.S. source income for U.S.
Federal income tax purposes.
Disposition. A U.S. Holder will recognize taxable gain or loss on the
sale, exchange, redemption, retirement or other disposition of a Note in an
amount equal to the difference between the amount realized from such disposition
(other than amounts attributable to accrued interest which would otherwise be
taxable as ordinary interest income) and the U.S. Holder's adjusted tax basis in
the Note. Such gain or loss generally will be capital gain or loss, and will be
long-term capital gain or loss if the U.S. Holder has held the Note for more
than one year at the time of disposition; preferential rates of tax may apply to
gains recognized by noncorporate U.S. Holders upon the disposition of Notes held
for more than eighteen months.
28
<PAGE>
Gain or Income Received by a Foreign Corporation. A foreign corporation
whose income or gain in respect of a Note is effectively connected with the
conduct of a United States trade or business, in addition to being subject to
regular U.S. Federal income tax, may be subject to a branch profits tax equal to
30% of its "effectively connected earnings and profits" within the meaning of
the Internal Revenue Code of 1986, as amended (the "Code"), for the taxable
year, as adjusted for certain items, unless it qualifies for a lower rate under
an applicable tax treaty (as modified by the branch profits tax rules).
Non-U.S. Holders
Generally, a non-U.S. Holder will not be subject to United States
Federal income taxes on payments of principal, premium, if any, or interest on a
Note, or on any gain upon disposition or retirement of a Note, if (i) such
non-U.S. Holder does not own 10% or more of the shares of beneficial interest of
the Company and (ii) the last United States payor in the chain of payment (the
"Withholding Agent") has received in the year in which a payment of interest or
principal occurs, or in either of the two preceding calendar years, a statement
signed by the beneficial owner of the Note under penalties of perjury certifying
that such owner is not a U.S. Holder and providing the name and address of the
beneficial owner. The statement may be made on an Internal Revenue Service
("IRS") Form W-8 or a substantially similar form, and the beneficial owner must
inform the Withholding Agent of any change in the information on the statement
within 30 days of such change. If a Note is held through a securities clearing
organization or certain other financial institutions, the organization or
institution may provide a signed statement to the Withholding Agent. However, in
such case, the signed statement must be accompanied by a copy of the IRS Form
W-8 or the substitute form provided by the beneficial owner to the organization
or institution. Interest received or gain recognized by a non-U.S. Holder which
does not qualify for exemption from taxation will be subject to United States
Federal income tax and withholding tax at a rate of 30% unless reduced or
eliminated by applicable tax treaty.
Treasury Regulations issued on October 6, 1997 (the "New Regulations")
alter the withholding rules on interest paid to a non-U.S. Holder of a Note. The
New Regulations are generally effective with respect to interest paid after
December 31, 1998. Withholding will generally be excused under the New
Regulations if the non-U.S. Holder owns less than 10% of the shares of
beneficial interest of the Company and if such non-U.S. Holder executes a
necessary IRS Form W-8. Moreover, under the New Regulations, to obtain a reduced
rate of withholding under an income tax treaty, a non-U.S. Holder generally will
be required to provide an IRS Form W-8 certifying such non-U.S. Holder's
entitlement to benefits under the treaty. The New Regulations also provide
special rules to determine whether, for purposes of determining the
applicability of a tax treaty, interest paid to a non-U.S. Holder that is an
entity should be treated as paid to the entity or to those holding the ownership
interests in that entity, and whether such entity or such holders in the entity
are entitled to benefits under the tax treaty. The New Regulations also alter
the information reporting and backup withholding rules applicable to non-U.S.
Holders and, among other things, provide certain presumptions under which a
non-U.S. Holder is subject to backup withholding and information reporting until
certification of non-U.S. status is received from such non-U.S. Holder. The
foregoing is not intended to be a complete discussion of the New Regulations,
and non-U.S. Holders are urged to consult their tax advisors with respect to the
effect of the New Regulations on an investment in the Notes.
The Notes will not be includible in the estate of a non-U.S. Holder for
United States estate tax purposes unless the individual owns directly or
indirectly 10% or more of the shares of beneficial interest of the Company or,
at the time of such individual's death, payments in respect of the Notes would
have been effectively connected with the conduct by such individual of a trade
or business in the United States.
Backup Withholding
Backup withholding of United States Federal income tax at a rate of 31%
may apply to payments made in respect of the Notes to registered owners who are
not "exempt recipients" and who fail to provide certain identifying information
(such as the registered owner's taxpayer identification number) in the required
manner. Generally, individuals are not exempt recipients, whereas corporations
and certain other entities generally are exempt recipients. Payments made in
respect of the Notes to a U.S. Holder must be reported to the IRS, unless the
U.S. Holder is an exempt recipient or establishes an exemption. Compliance with
the identification procedures described in the
29
<PAGE>
preceding section would establish an exemption from backup withholding for those
non-U.S. Holders who are not exempt recipients.
In addition, upon the sale of a Note by or through a broker, the broker
must withhold 31% of the entire purchase price, unless either (i) the broker
determines that the seller is a corporation or other exempt recipient or (ii)
the seller provides, in the required manner, certain identifying information
and, in the case of a non-U.S. Holder, certifies that such seller is a non-U.S.
Holder (and certain other conditions are met). Such a sale must also be reported
by the broker to the IRS, unless either (i) the broker determines that the
seller is an exempt recipient or (ii) the seller certifies its non-U.S. status
(and certain other conditions are met). Certification of the registered owner's
non-U.S. status would be made normally on an IRS Form W-8 under penalties of
perjury, although in certain cases it may be possible to submit other
documentary evidence.
Any amounts withheld under the backup withholding rules from a payment
to a beneficial owner would be allowed as a refund or a credit against such
beneficial owner's United States Federal income tax provided the required
information is furnished to the IRS.
PLAN OF DISTRIBUTION
Each broker-dealer that receives New Notes for its own account pursuant
to the Exchange Offer must acknowledge that it will deliver a prospectus in
connection with any resale of such New Notes. This Prospectus, as it may be
amended or supplemented from time to time, may be used by a broker-dealer in
connection with resales of New Notes received in exchange for Old Notes where
such Old Notes were acquired as a result of market-making activities or other
trading activities. The Company has agreed for a period of at least 120 days
after the consummation of the Exchange Offer to make this Prospectus, as amended
or supplemented, available to any broker-dealer for use in connection with any
such resale. In addition, until __________, 1998, all dealers effecting
transactions in the New Notes may be required to deliver a prospectus.
The Company will not receive any proceeds from any sale of New Notes by
broker-dealers. New Notes received by broker-dealers for their own accounts
pursuant to the Exchange Offer may be sold from time to time in one or more
transactions in the over-the-counter market, in negotiated transactions through
the writing of options on the New Notes or a combination of such methods of
resale, at market prices prevailing at the time of resale, at prices related to
such prevailing market prices or at negotiated prices. Any such resale may be
made directly to purchasers or to or through brokers or dealers who may receive
compensation in the form of commissions or concessions from any such
broker-dealer and/or the purchasers of any such New Notes. Any broker-dealer
that resells New Notes that were received by it for its own account pursuant to
the Exchange Offer and any broker or dealer that participates in a distribution
of such New Notes may be deemed to be an "underwriter" within the meaning of the
Securities Act and any profit on any such resale of New Notes and any
commissions or concessions received by any such persons may be deemed to be
underwriting compensation under the Securities Act. The Letter of Transmittal
states that by acknowledging that it will deliver and by delivering a
prospectus, a broker-dealer will not be deemed to admit that it is an
"underwriter" within the meaning of the Securities Act.
For a period of at least 120 days after the consummation of the
Exchange Offer, the Company will promptly send additional copies of this
Prospectus and any amendment or supplement to this Prospectus to any
broker-dealer that requests such documents in the Letter to Transmittal. The
Company has agreed to pay all expenses incident to the Exchange Offer (including
the expenses of any special counsel for the holders of the Old Notes) other than
commissions or concessions of any brokers or dealers and will indemnify the
holders of the Old Notes participating in the Exchange Offer (including any
broker-dealers) against certain liabilities, including liabilities under the
Securities Act.
TRANSFER RESTRICTIONS
Unless and until an Old Note is exchanged for a New Note pursuant to
the Exchange Offer, its will bear the following legend on the face thereof:
30
<PAGE>
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND SUCH SECURITY MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) TO THE
COMPANY, (2) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
(3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904
OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE), OR (5) IN A TRANSACTION OTHERWISE EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY OTHER APPLICABLE LAW.
TRANSFERS AND EXCHANGES OF THIS SECURITY ARE SUBJECT TO RESTRICTIONS AS
PROVIDED IN THE INDENTURE.
The New Notes will not contain such restrictive legends or be otherwise
subject to the restrictions on their transfer, except that the New Global Notes
shall bear the following legend on the face thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
LEGAL MATTERS
Certain legal matters with respect to the New Notes will be passed upon
for the Company by Sullivan & Worcester LLP, Boston, Massachusetts. Sullivan &
Worcester LLP will rely, as to all matters of Maryland law, upon the opinion of
Piper & Marbury L.L.P., Baltimore, Maryland. Barry M. Portnoy was a partner in
the firm of Sullivan & Worcester LLP until March 31, 1997 and is a Managing
Trustee of the Company and of HPT, a director and 50% shareholder of HRPT
Advisors, Inc. ("Advisors") and REIT Management & Research, Inc., the Company's
investment advisor ("RMR"), and a director and/or significant shareholder of
certain lessees of the Company. Sullivan & Worcester LLP represents HPT,
Advisors, RMR, certain of such lessees and certain of their affiliates on
various matters.
EXPERTS
The consolidated financial statements of the Company included in the
Company's Current Report on Form 8-K dated February 27, 1998 and incorporated by
reference in the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, have been audited by Ernst & Young LLP, independent auditors,
as set forth in their report thereon included therein and incorporated herein by
reference, which, as to the years 1996 and 1997, are based in part on the report
of Arthur Andersen LLP, independent public accountants. Such consolidated
financial statements are incorporated herein by reference in reliance upon such
reports given upon the authority of such firms as experts in accounting and
auditing.
The consolidated financial statements of Marriott International, Inc.
incorporated by reference in this Prospectus and elsewhere in the registration
statement to the extent and for the periods indicated in their reports, have
been audited by Arthur Andersen LLP, independent public accountants, and are
included herein in reliance upon the authority of said firm as experts in giving
said reports.
31
<PAGE>
-------------------------
THE AMENDED AND RESTATED DECLARATION OF TRUST ESTABLISHING THE COMPANY, DATED
JULY 1, 1994, A COPY OF WHICH, TOGETHER WITH ALL AMENDMENTS THERETO (THE
"DECLARATION"), IS DULY FILED IN THE OFFICE OF THE DEPARTMENT OF ASSESSMENTS AND
TAXATION OF THE STATE OF MARYLAND, PROVIDES THAT THE NAME "HEALTH AND RETIREMENT
PROPERTIES TRUST" REFERS TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS
TRUSTEES, BUT NOT INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER,
SHAREHOLDER, EMPLOYEE OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL
LIABILITY, JOINTLY OR SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE
COMPANY. ALL PERSONS DEALING WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO
THE ASSETS OF THE COMPANY FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY
OBLIGATION.
32
<PAGE>
<TABLE>
<CAPTION>
INDEX TO PRO FORMA CONSOLIDATED FINANCIAL STATEMENTS
<S> <C>
Introduction to Unaudited Pro Forma Consolidated Financial Statements...........................................F-2
Unaudited Pro Forma Consolidated Balance Sheet as of December 31, 1997..........................................F-3
Unaudited Pro Forma Consolidated Statement of Income for the year ended December 31, 1997.......................F-4
Notes to Unaudited Pro Forma Consolidated Financial Statements..................................................F-5
</TABLE>
F-1
<PAGE>
HEALTH AND RETIREMENT PROPERTIES TRUST
Unaudited Pro Forma Consolidated Financial Statements
The following unaudited pro forma consolidated balance sheet as of
December 31, 1997 and the consolidated statement of income for the year ended
December 31, 1997, present the consolidated financial position and the results
of operations of Health and Retirement Properties Trust and consolidated
subsidiaries (the "Company") as if the transactions described in the notes to
unaudited financial statements were consummated on January 1, 1997. Additional
information with respect to such transactions is provided in the Company's
Annual Report on Form 10-K for its fiscal year ended December 31, 1997 (and in
materials incorporated by reference therein), which is incorporated by reference
into this Prospectus. These unaudited pro forma consolidated financial
statements should be read in connection with, and are qualified in their
entirety by reference to, the separate consolidated financial statements of the
Company for the year ended December 31, 1997, included in the Company's Current
Report on Form 8-K dated February 27, 1998, which is incorporated by reference
into this Prospectus. These unaudited pro forma consolidated financial
statements are not necessarily indicative of the financial position and the
expected results of operations of the Company for any future period. Differences
could result from, among other considerations, future changes in the Company's
portfolio of investments, changes in interest rates, changes in the capital
structure of the Company, delays in the acquisition of certain properties and
changes in property level operating expenses.
F-2
<PAGE>
<TABLE>
<CAPTION>
Health and Retirement Properties Trust
Pro Forma Consolidated Balance Sheets
December 31, 1997
(dollars in thousands)
(unaudited)
Recent
Historical Acquisitions (A) Pro Forma
------------ ----------------- ---------
<S> <C> <C> <C>
ASSETS
Real estate properties, at cost: $1,969,023 $ 91,712 $2,060,735
Less accumulated depreciation 111,669 -- 111,669
---------- ---------- ----------
1,857,354 91,712 1,949,066
Real estate mortgages, net 104,288 -- 104,288
Investment in Hospitality Properties Trust 111,134 -- 111,134
Other assets 63,187 (46,712) 16,475
---------- ---------- ----------
$2,135,963 45,000 2,180,963
========== ========== ==========
LIABILITIES AND SHAREHOLDERS' EQUITY
Bank notes payable $ 200,000 $ 45,000 $ 245,000
Senior notes and bonds payable, net 349,900 -- 349,900
Mortgage notes payable 26,329 -- 26,329
Convertible subordinated debentures 211,650 -- 211,650
Other liabilities 81,824 81,824
Shareholders' equity 1,266,260 1,266,260
---------- ---------- ----------
$2,135,963 $ 45,000 $2,180,963
========== ========== ==========
</TABLE>
See accompanying notes to unaudited pro forma financial statements
F-3
<PAGE>
<TABLE>
<CAPTION>
Health and Retirement Properties Trust
Pro Forma Consolidated Statements of Income
Year Ended December 31, 1997
(amounts in thousands, except per share data)
(unaudited)
Second Third
Quarter Quarter West
Acquisitions Acquisitions 34th
Historical GPI(B) CSMC(C) (D) (D) Street (E)
----------- ---------- ---------- ----------- ------------- -----------
<S> <C> <C> <C> <C> <C> <C>
Revenues:
Rental Income $188,000 $ 11,959 $ 6,831 $ 2,948 $ 3,179 $ 10,771
Interest Income 20,863 (366) -- -- -- --
-------- -------- -------- -------- -------- --------
Total revenues 208,863 11,593 6,831 2,948 3,179 10,771
-------- -------- -------- -------- -------- --------
Expenses:
Operating 26,765 2,053 1,910 -- 954 3,641
Interest 36,766 (1,216) 3,232 1,087 1,463 2,876
Depreciation and amortization 39,330 4,156 1,119 627 501 1,869
General and administrative 11,670 2,105 249 139 111 415
-------- -------- -------- -------- -------- --------
Total expenses 114,531 7,098 6,510 1,853 3,029 8,801
-------- -------- -------- -------- -------- --------
Income before equity in earnings of
Hospitality Properties Trust and
before extraordinary item 94,332 4,495 321 1,095 150 1,970
Equity in earnings of Hospitality
Properties Trust 8,590
Gain on equity transaction of
Hospitality Properties Trust 9,282 - -
-------- -------- -------- -------- -------- --------
Net income before extraordinary item $112,204 $ 4,495 $ 321 $ 1,095 $ 150 $ 1,970
-------- -------- -------- -------- -------- --------
Average shares outstanding 92,168
Basic and diluted earnings per commonshare:
Net income before extraordinary item $ 1.22
<CAPTION>
Fourth
Quarter
Franklin Bridgepoint Acquisitions Recent
Plaza (F) Square (G) (D) Acquisitions (H) Pro Forma
---------- -------------- ------------- ---------------- ------------
<S> <C> <C> <C> <C> <C>
Revenues:
Rental Income $ 9,614 $ 5,599 $ 8,461 $ 13,102 $260,464
Interest Income -- -- -- 20,497
-------- -------- -------- -------- --------
Total revenues 9,614 5,599 8,461 13,102 280,961
-------- -------- -------- -------- --------
Expenses:
Operating 4,904 2,162 2,634 3,931 48,954
Interest 2,486 3,216 4,338 2,925 57,173
Depreciation and amortization 1,334 1,175 1,269 2,064 53,444
General and administrative 296 262 283 46 15,576
-------- -------- -------- -------- --------
Total expenses 9,020 6,815 8,524 8,966 175,147
-------- -------- -------- -------- --------
Income before equity in earnings of
Hospitality Properties Trust and
before extraordinary item 594 (1,216) (63) 4,136 105,814
Equity in earnings of Hospitality
Properties Trust - 8,590
Gain on equity transaction of
Hospitality Properties Trust - - - 9,282
-------- -------- -------- -------- --------
Net income before extraordinary ite$ $ 594 $ (1,216) $ (63) $ 4,136 $123,686
-------- -------- -------- -------- --------
Average shares outstanding 98,838
Basic and diluted earnings per
common share
Net income before extraordinary item $ 1.25
</TABLE>
See accompanying notes to unaudited pro forma financial statements
F-4
<PAGE>
Notes to Unaudited Pro Forma Consolidated Financial Statements
Pro Forma Balance Sheet Adjustments at December 31, 1997.
A. Represents the Company's acquisitions, during January 1998 and February
1998 of two medical office properties and three commercial office
properties located in Pennsylvania, a commercial office property located in
Texas, a medical office property located in Massachusetts, a commercial
office property located in Maryland and three medical office properties
located in Florida (collectively, "Recent Acquisitions"). The Recent
Acquisitions were funded with available cash and by drawings under the
Company's existing revolving line of credit.
Pro Forma Statement of Income Adjustments for the Year Ended December 31, 1997.
B. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's acquisition of the government office properties ("Government
Office Properties") from Government Property Investors, Inc. Also reflects
the decrease in interest expense arising from the Company's issuance of its
common shares of beneficial interest in a March 1997 offering, the proceeds
of which were used in part to repay amounts then outstanding under the
Company's revolving line of credit, net of an increase in interest expense
related to the Company's assumption of certain debt in connection with the
acquisition of the Government Office Properties.
C. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's acquisition of two medical office properties and two parking
structures located in Los Angeles, California, as well as the increase in
interest expense due to the use of the Company's revolving line of credit
to fund this acquisition.
D. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's acquisition of a) a 200 unit retirement housing property located
in Spokane, Washington and 20 medical office clinics and ancillary
structures located in Massachusetts during the second quarter, b) three
medical and two commercial office buildings located in Pennsylvania during
the third quarter and c) a medical office property located in Colorado, a
medical office property located in Maryland, a medical office property
located in Rhode Island, three medical office properties located in
California, and a medical office property located in Washington, D.C.
during the third quarter, as well as the increase in interest expense due
to the use of the Company's revolving line of credit to fund these
acquisitions.
E. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's acquisition of West 34th Street in New York City, as well as the
increase in interest due to the use of the Company's revolving line of
credit to fund the acquisition.
F. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's acquisition of Franklin Plaza in Philadelphia, Pennsylvania, as
well as the increase in interest expense due to the use of the Company's
revolving line of credit to fund the acquisition.
G. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's acquisition of Bridgepoint Square, Austin, Texas. Bridgepoint
Square consists of five properties, of which one property was under
construction at September 30, 1997 and one property was completed in July
1997. Also represents the increase in interest expense due to the use of
the Company's revolving line of credit to fund the acquisition.
H. Represents the increase in rental income, operating expenses, depreciation
and amortization and general and administrative expenses arising from the
Company's Recent Acquisitions as well as the increase in interest due to
the use of the Company's revolving line of credit to fund these
acquisitions.
F-5
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 20. Indemnification of Directors and Officers
Section 7.4 of the Company's Amended and Restated Declaration of Trust,
filed as an Exhibit to the Company's Current Report on Form 8-K dated July 10,
1996, which provides for indemnification of Trustees and officers of the
Company, is hereby incorporated by reference.
<TABLE>
<CAPTION>
Item 21. Exhibits
<S> <C>
4.1 - Indenture, dated as of December 18, 1997, between the Company and State Street Bank and Trust
Company, as trustee. (Filed herewith as Exhibit 4.1)
4.2 - Supplemental Indenture, dated as of December 18, 1997, between the Company and State Street Bank and
Trust Company, as trustee. (Filed herewith as Exhibit 4.2)
4.3 - Registration Rights Agreement dated as of December 18, 1997 by and between the Company and Merrill
Lynch & Co. (Incorporated by reference to the Company's Current Report on Form 8-K, dated
December 5, 1997)
5.1 - Opinion of Sullivan & Worcester LLP (Filed herewith as Exhibit 5.1)
5.2 - Opinion of Piper & Marbury L.L.P. (Filed herewith as Exhibit 5.2)
8 - Opinion of Sullivan & Worcester LLP re: tax matters (Filed herewith as Exhibit 8)
12 - Statement Regarding Computation of Ratios of Earnings to Fixed
Charges (Incorporated by reference to the Company's Annual Report on
Form 10-K for the fiscal year ended December 31, 1997)
23.1 - Consent of Ernst & Young LLP (Filed herewith as Exhibit 23.1)
23.2 - Consent of Arthur Andersen LLP (Filed herewith as Exhibit 23.2)
23.3 - Consent of Arthur Andersen LLP (Filed herewith as Exhibit 23.3)
23.4 - Consent of Sullivan & Worcester LLP (Included in Exhibits 5.1 and 8)
23.5 - Consent of Piper & Marbury L.L.P. (Included in Exhibit 5.2)
24 - Powers of Attorney (Included at Page II-4)
25.1 - Statement of Eligibility of Trustee on Form T-1 (Filed herewith as Exhibit 25.1)
99.1 - Form of Letter of Transmittal (Filed herewith as Exhibit 99.1)
99.2 - Form of Notice of Guaranteed Delivery (Filed herewith as Exhibit 99.2)
</TABLE>
Item 22. Undertakings
(a) 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, as amended (the "Securities Act");
(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 this registration statement.
Notwithstanding the foregoing, any increase or decrease in
volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered)
and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b)
(Section 230.424(b) of 17 C.F.R.) if, in the aggregate, the
changes in volume and price represent no more than a 20%
change in the maximum aggregate offering price set forth in
the "Calculation of Registration Fee" table in the effective
registration statement; and
II-1
<PAGE>
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in this registration
statement or any material change to such information in this
registration statement;
provided, however, that subparagraphs (i) and (ii) do not apply if the
information required to be included in a post-effective amendment by
those paragraphs is contained in the periodic reports filed by the
Registrant pursuant to Section 13 or Section 15(d) of the Securities
and Exchange Act of 1934 that are incorporated by reference in this
registration statement.
(2) That for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the Securities
offered herein, 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 the 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 Section 15(d) of the Securities Exchange
of 1934 that is incorporated by reference in this registration
statement shall be deemed to be a new registration statement relating
to the Securities offered herein, and the offering of such Securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(5) That prior to any public reoffering of the securities registered
hereunder through the use of a prospectus which is part of this
Registration Statement, by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c), the Registrant
undertakes that such reoffering prospectus will contain the information
called for by the applicable registration form with respect to
reofferings by persons who may be deemed underwriters, in addition to
the information called for by the other items of the applicable form;
(6) That every prospectus: (i) that is filed pursuant to paragraph (4)
immediately preceding, or (ii) that purports to meet the requirements
of Section 10(a)(3) of the Securities Act and is used in connection
with an offering of securities subject to Rule 145, will be filed as a
part of an amendment to the Registration Statement and will not be used
until such amendment is effective, and that, for purposes of
determining any liability under the Securities Act, each such
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;
(7) To respond to requests for information that is incorporated by
reference into the prospectus pursuant to Item 4, 10(b), 11 or 13 of
this form, within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally
prompt means. This includes information contained in documents filed
subsequent to the effective date of this Registration Statement through
the date of responding to the request.
(8) To supply by means of a post-effective amendment, all information
concerning a transaction, and the company being acquired involved
therein, that was not the subject of and included in the Registration
Statement when it became effective.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to trustees, officers and controlling persons of
the Registrant pursuant to the provisions described under Item 15 of this
registration statement, or otherwise (other than insurance), the Registrant has
been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in such Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a trustee, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
trustee, officer or controlling person in
II-2
<PAGE>
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 such Act and will
be governed by the final adjudication of such issue.
II-3
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended,
the Registrant has duly caused this registration statement to be signed on its
behalf by the undersigned, thereunto duly authorized, in the City of Newton,
Commonwealth of Massachusetts, on March 11, 1998.
HEALTH AND RETIREMENT PROPERTIES TRUST
By: /s/ David J. Hegarty
David J. Hegarty
President and Chief Operating Officer
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement on Form S-4 relating to the New Notes has been
signed below by the following persons in the capacities and on the dates
indicated; and each of the undersigned officers and trustees of Health and
Retirement Properties Trust, hereby severally constitute and appoint David J.
Hegarty, Ajay Saini, Gerard M. Martin and Barry M. Portnoy, and each of them, to
sign for him, and in his name in the capacity indicated below, this Registration
Statement for the purpose of registering such securities under the Securities
Act of 1933, as amended, and any and all amendments thereto, hereby ratifying
and confirming our signatures as they may be signed by our attorneys to such
Registration Statement and any and all amendments thereto.
<TABLE>
<CAPTION>
Signature Title Date
<S> <C> <C>
/s/ David J. Hegarty President and Chief Operating March 11, 1998
David J. Hegarty Officer (principal executive officer)
/s/ Ajay Saini Treasurer and Chief Financial March 11, 1998
Ajay Saini Officer
/s/ Bruce M. Gans, M.D. Trustee March 11, 1998
Bruce M. Gans, M.D.
/s/ Rev. Justinian Manning, C.P. Trustee March 11, 1998
Rev. Justinian Manning, C.P.
/s/ Gerard M. Martin Managing Trustee March 11, 1998
Gerard M. Martin
/s/ Barry M. Portnoy Managing Trustee March 11, 1998
Barry M. Portnoy
/s/ Ralph J. Watts Trustee March 11, 1998
Ralph J. Watts
</TABLE>
II-4
EXHIBIT 4.1
HEALTH AND RETIREMENT PROPERTIES TRUST
TO
STATE STREET BANK AND TRUST COMPANY
Trustee
Indenture
Dated as of December 18, 1997
Unsecured Debt Securities
<PAGE>
<TABLE>
<CAPTION>
TABLE OF CONTENTS1
<S> <C> <C>
PAGE
PARTIES......................................................................1
RECITALS.....................................................................1
ARTICLE 1
DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION......................1
Section 101. Definitions...........................................1
"Act"...............................................................1
"Additional Amounts"................................................1
"Affiliate".........................................................2
"Authenticating Agent"..............................................2
"Authorized Newspaper"..............................................2
"Bankruptcy Law"....................................................2
"Bearer Security"...................................................2
"Board".............................................................2
"Board Resolution"..................................................2
"Business Day"......................................................2
"CEDEL".............................................................2
"Commission"........................................................2
"Common Depositary".................................................2
"Company"...........................................................2
"Company Request" and "Company Order"...............................2
"Conversion Event"..................................................2
"Corporate Trust Office"............................................3
"corporation".......................................................3
"coupon"............................................................3
"Custodian".........................................................3
"Declaration".......................................................3
"Defaulted Interest"................................................3
"Dollar" or "$".....................................................3
"DTC"...............................................................3
"ECU"...............................................................3
"Euroclear".........................................................3
"European Communities"..............................................3
"European Monetary System"..........................................3
"Event of Default"..................................................3
"Exchange Date".....................................................3
"Foreign Currency"..................................................3
"Funds from Operations".............................................3
"GAAP"..............................................................3
"Government Obligations"............................................3
"Holder"............................................................4
"Indenture".........................................................4
"Indexed Security"..................................................4
"interest"..........................................................4
"Interest Payment Date".............................................4
"Maturity"..........................................................4
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1 This Table of Contents shall not, for any purpose, be deemed to be part of this Indenture.
<PAGE>
"Officers' Certificate".............................................4
"Opinion of Counsel".................................................4
"Original Issue Discount Security"...................................4
"Outstanding"........................................................4
"Paying Agent".......................................................5
"Person".............................................................5
"Place of Payment"...................................................5
"Predecessor Security"...............................................5
"Redemption Date"....................................................6
"Redemption Price"...................................................6
"Registered Security"................................................6
"Regular Record Date"................................................6
"Repayment Date".....................................................6
"Responsible Officer"................................................6
"Security"...........................................................6
"Security Register" and "Security Registrar".........................6
"Significant Subsidiary".............................................6
"Special Record Date"................................................6
"Stated Maturity"....................................................6
"Subsidiary".........................................................6
"Trust Indenture Act" or "TIA".......................................7
"Trustee"............................................................7
"United States"......................................................7
"United States person"...............................................7
"Yield to Maturity"..................................................7
Section 102. Compliance Certificates and Opinions...................7
Section 103. Form of Documents Delivered to Trustee.................7
Section 104. Acts of Holders........................................8
Section 105. Notices, etc., to Trustee and Company..................9
Section 106. Notice to Holders; Waiver..............................9
Section 107. Effect of Headings and Table of Contents..............10
Section 108. Successors and Assigns................................10
Section 109. Separability Clause...................................10
Section 110. Benefits of Indenture.................................10
Section 111. Governing Law.........................................10
Section 112. Legal Holidays........................................10
Section 113. No Personal Liability.................................10
ARTICLE 2
SECURITIES FORMS.............................................................11
Section 201. Forms of Securities...................................11
Section 202. Form of Trustee's Certificate of Authentication.......11
Section 203. Securities Issuable in Global Form....................11
ARTICLE 3
THE SECURITIES...............................................................12
Section 301. Amount Unlimited; Issuable in Series..................12
Section 302. Denominations.........................................15
Section 303. Execution, Authentication, Delivery and Dating........15
Section 304. Temporary Securities..................................16
Section 305. Registration, Registration of Transfer and Exchange...18
-ii-
<PAGE>
Section 306. Mutilated, Destroyed, Lost and Stolen Securities......20
Section 307. Payment of Interest; Interest Rights Preserved........21
Section 308. Persons Deemed Owners.................................22
Section 309. Cancellation..........................................23
Section 310. Computation of Interest...............................23
ARTICLE 4
SATISFACTION AND DISCHARGE...................................................23
Section 401. Satisfaction and Discharge of Indenture...............23
Section 402. Application of Trust Funds............................24
ARTICLE 5
REMEDIES.....................................................................25
Section 501. Events of Default.....................................25
Section 502. Acceleration of Maturity; Rescission and Annulment....26
Section 503. Collection of Indebtedness and Suits for Enforcement
by Trustee.........................................27
Section 504. Trustee May File Proofs of Claim......................27
Section 505. Trustee May Enforce Claims Without Possession of
Securities or Coupons..............................28
Section 506. Application of Money Collected........................28
Section 507. Limitation on Suits...................................28
Section 508. Unconditional Right of Holders to Receive Principal,
Premium, if any, Interest and Additional
Amounts.............................................................29
Section 509. Restoration of Rights and Remedies....................29
Section 510. Rights and Remedies Cumulative........................29
Section 511. Delay or Omission Not Waiver..........................29
Section 512. Control by Holders of Securities......................29
Section 513. Waiver of Past Defaults...............................30
Section 514. Waiver of Usury, Stay or Extension Laws...............30
Section 515. Undertaking for Costs.................................30
ARTICLE 6
THE TRUSTEE..................................................................30
Section 601. Notice of Defaults....................................30
Section 602. Certain Rights of Trustee.............................30
Section 603. Not Responsible for Recitals or Issuance of
Securities........................................31
Section 604. May Hold Securities...................................31
Section 605. Money Held in Trust...................................32
Section 606. Compensation and Reimbursement........................32
Section 607. Corporate Trustee Required; Eligibility; Conflicting
Interests.........................................32
Section 608. Resignation and Removal; Appointment of Successor.....32
Section 609. Acceptance of Appointment by Successor................33
Section 610. Merger, Conversion, Consolidation or Succession to
Business..........................................34
Section 611. Appointment of Authentication Agent...................34
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY............................36
Section 701. Disclosure of Names and Addresses of Holders..........36
Section 702. Reports by Trustee....................................36
Section 703. Reports by Company....................................36
-iii-
<PAGE>
Section 704. Company to Furnish to Trustee Names and Addresses
of Holders.............................................36
ARTICLE 8
CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE.............................37
Section 801. Consolidations and Mergers of Company and Sales,
Leases and Conveyances Permitted Subject to
Certain Conditions.................................37
Section 802. Rights and Duties of Successor Corporation............37
Section 803. Officers' Certificate and Opinion of Counsel..........37
ARTICLE 9
SUPPLEMENTAL INDENTURES......................................................37
Section 901. Supplemental Indentures Without Consent of Holders.............37
Section 902. Supplemental Indentures with Consent of Holders.......38
Section 903. Execution of Supplemental Indentures..................39
Section 904. Effect of Supplemental Indentures.....................39
Section 905. Conformity with Trust Indenture Act...................39
Section 906. Reference in Securities to Supplemental Indentures....39
ARTICLE 10
COVENANTS....................................................................40
Section 1001. Payment of Principal, Premium, if any, Interest and
Additional Amounts..........................................40
Section 1002. Maintenance of Office or Agency......................40
Section 1003. Money for Securities Payments to Be Held in Trust....41
Section 1004. Existence............................................42
Section 1005. Provision of Financial Information...................42
Section 1006. Statement as to Compliance...........................42
Section 1007. Additional Amounts...................................43
Section 1008. Waiver of Certain Covenants..........................43
ARTICLE 11
REDEMPTION OF SECURITIES.....................................................43
Section 1101. Applicability of Article.............................43
Section 1102. Election to Redeem; Notice to Trustee................43
Section 1103. Selection by Trustee of Securities to Be Redeemed....44
Section 1104. Notice of Redemption.................................44
Section 1105. Deposit of Redemption Price..........................45
Section 1106. Securities Payable on Redemption Date................45
Section 1107. Securities Redeemed in Part..........................46
ARTICLE 12
SINKING FUNDS................................................................46
Section 1201. Applicability of Article.............................46
Section 1202. Satisfaction of Sinking Fund Payments with
Securities........................................46
Section 1203. Redemption of Securities for Sinking Fund............46
-iv-
<PAGE>
ARTICLE 13
REPAYMENT AT THE OPTION OF HOLDERS...........................................47
Section 1301. Applicability of Article.............................47
Section 1302. Repayment of Securities..............................47
Section 1303. Exercise of Option...................................47
Section 1304. When Securities Presented for Repayment Become Due
and Payable.......................................48
Section 1305. Securities Repaid in Part............................48
ARTICLE 14
DEFEASANCE AND COVENANT DEFEASANCE...........................................48
Section 1401. Applicability of Article; Company's Option to
Effect Defeasance or Covenant Defeasance..........48
Section 1402. Defeasance and Discharge.............................49
Section 1403. Covenant Defeasance..................................49
Section 1404. Conditions to Defeasance or Covenant Defeasance......49
Section 1405. Deposited Money and Government Obligations to Be
Held in Trust; Other Miscellaneous Provisions......51
ARTICLE 15
MEETINGS OF HOLDERS OF SECURITIES............................................51
Section 1501. Purposes for Which Meetings May Be Called............51
Section 1502. Call, Notice and Place of Meetings...................51
Section 1503. Persons Entitled to Vote at Meetings.................52
Section 1504. Quorum; Action.......................................52
Section 1505. Determination of Voting Rights; Conduct and
Adjournment of Meetings............................53
Section 1506. Counting Votes and Recording Action of Meetings......53
TESTIMONIUM..................................................................__
SIGNATURES AND SEALS.........................................................__
ACKNOWLEDGMENTS..............................................................__
EXHIBIT A -- FORMS OF CERTIFICATION
</TABLE>
-v-
<PAGE>
HOSPITALITY PROPERTIES TRUST
Reconciliation and tie between Trust Indenture Act of 1939, as amended
(the "TIA"), and Indenture, dated as of __________, 199_.
TIA Section Indenture Section
Sec. 310(a)(1).......................... 607
(a)(2).......................... 607
(b)............................. 607, 608
Sec. 312(a)............................. 704
Sec. 312(c)............................. 701
Sec. 313(a)............................. 702
(c).............................. 702
Sec. 314(a)............................. 1006
(a)(4)........................... 1007
(c)(1)........................... 102
(c)(2)........................... 102
(e).............................. 102
Sec. 315(b)............................. 601
Sec. 316(a) (last sentence)............. 101 ("Outstanding")
(a)(1)(A)....................... 502, 512
(a)(1)(B)....................... 513
(b).............................. 508
Sec. 317(a)(1).......................... 503
(a)(2)........................... 504
Sec. 318(a)............................. 111
(c).............................. 111
- -------------------
NOTE: This reconciliation and tie shall not, for any purpose, be deemed to be a
part of the Indenture.
Attention should also be directed to Section 318(c) of the TIA, which
provides that the provisions of Sections 310 to and including 317 of the TIA are
a part of and govern every qualified indenture, whether or not physically
contained therein.
-vi-
<PAGE>
INDENTURE, dated as of December 18, 1997, between HEALTH AND RETIREMENT
PROPERTIES TRUST, a Maryland real estate investment trust (hereinafter called
the "Company"), having its principal office at 400 Centre Street, Newton,
Massachusetts 02158 and STATE STREET BANK AND TRUST COMPANY, as Trustee
hereunder (hereinafter called the "Trustee"), having its initial Corporate Trust
Office at Two International Place, Boston, Massachusetts 02110.
RECITALS OF THE COMPANY
The Company deems it necessary to issue from time to time for
lawful purposes its unsecured debt securities (hereinafter called the
"Securities") evidencing its unsecured indebtedness, and has duly authorized the
execution and delivery of this Indenture to provide for the issuance from time
to time of the Securities, unlimited as to principal amount, to bear interest at
the rates or formulas, to mature at such times and to have such other provisions
as shall be fixed as hereinafter provided.
This Indenture is subject to the provisions of the Trust
Indenture Act of 1939, as amended, that are deemed to be incorporated into this
Indenture by such Act, and shall, to the extent applicable, be governed by such
provisions.
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 Securities by the Holders thereof, it is mutually covenanted and agreed, for
the equal and proportionate benefit of all Holders of the Securities or of a
series thereof, as follows:
ARTICLE 1
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,
and the terms "cash transaction" and "self-liquidating paper", as used in TIA
Section 311, shall have the meanings assigned to them in the rules of the
Commission adopted under the TIA;
(3) all accounting terms not otherwise defined herein have the meanings
assigned to them in accordance with GAAP; and
(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.
Certain terms, used principally in Article 3, Article 5, Article 6 and
Article 10, are defined in those Articles.
"Act", when used with respect to any Holder, has the meaning specified
in Section 104.
"Additional Amounts" means any additional amounts which are required by
a Security or by or pursuant to a Board Resolution, under circumstances
specified therein, to be paid by the Company in respect of certain taxes imposed
on certain Holders and which are owing to such Holders.
"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 purposes of this definition,
"control" when used with respect to any specified Person means the power to
direct the management and policies of such Person,
<PAGE>
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 authenticating agent appointed by the
Trustee pursuant to Section 611.
"Authorized Newspaper" means a newspaper, printed in the English
language or in an official language of the country of publication, customarily
published on each Business Day, whether or not published on Saturdays, Sundays
or holidays, and of general circulation in each place in connection with which
the term is used or in the financial community of each such place. Whenever
successive publications are required to be made in Authorized Newspapers, the
successive publications may be made in the same or in different Authorized
Newspapers in the same city meeting the foregoing requirements and in each case
on any Business Day.
"Bankruptcy Law" has the meaning specified in Section 501.
"Bearer Security" means any Security established pursuant to Section
201 which is payable to bearer.
"Board" means the board of trustees of the Company or any committee of
that board duly authorized to act hereunder.
"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 and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day", when used with respect to any Place of Payment or any
other particular location referred to in this Indenture or in the Securities,
means, unless otherwise specified with respect to any Securities pursuant to
Section 301, any day, other than a Saturday or Sunday, that is neither a legal
holiday nor a day on which banking institutions in that Place of Payment or
particular location are authorized or required by law, regulation or executive
order to close.
"CEDEL" means Cedel, S.A., or its successor.
"Commission" means the Securities and Exchange Commission, as from time
to time constituted, created under the Securities Exchange Act of 1934, or, if
at any time after execution of this instrument such Commission is not existing
and performing the duties now assigned to it under the Trust Indenture Act, then
the body performing such duties on such date.
"Common Depositary" has the meaning specified in Section 304.
"Company" means the Person named as the "Company" in the first
paragraph of this Indenture until a successor shall have become such pursuant to
the applicable provisions of this Indenture, and thereafter "Company" shall mean
such successor.
"Company Request" and "Company Order" mean, respectively, a written
request or order signed in the name of the Company by the President or a Vice
President, and by its Treasurer, an Assistant Treasurer, the Secretary or an
Assistant Secretary, of the Company, and delivered to the Trustee.
"Conversion Event" means the cessation of use of (i) a Foreign Currency
both by the government of the country which issued such currency and for the
settlement of transactions by a central bank or other public institution of or
within the international banking community, (ii) the ECU both within the
European Monetary System and for the settlement of transactions by public
institutions of or within the European Communities or (iii) any currency unit
(or composite currency) other than the ECU for the purposes for which it was
established.
"Corporate Trust Office" means the office of the Trustee at which, at
any particular time, its corporate trust business shall be principally
administered, which office at the date hereof is located at Two International
Place, Boston, Massachusetts 02110.
"corporation" includes corporations, associations, companies and
business trusts.
2
<PAGE>
"coupon" means any interest coupon appertaining to a Bearer Security.
"Custodian" has the meaning specified in Section 501.
"Declaration" has the meaning specified in Section 113.
"Defaulted Interest" has the meaning specified in Section 307.
"Dollar" or "$" means a dollar or other equivalent unit in such coin or
currency of the United States of America as at the time shall be legal tender
for the payment of public and private debts.
"DTC" means The Depository Trust Company, or any successor thereto.
"ECU" means the European Currency Unit as defined and revised from time
to time by the Council of the European Communities.
"Euroclear" means Morgan Guaranty Trust Company of New York, Brussels
Office, or its successor as operator of the Euroclear System.
"European Communities" means the European Economic Community, the
European Coal and Steel Community and the European Atomic Energy Community.
"European Monetary System" means the European Monetary System
established by the Resolution of December 5, 1978 of the Council of the European
Communities.
"Event of Default" has the meaning specified in Article 5.
"Exchange Date" has the meaning specified in Section 304.
"Foreign Currency" means any currency, currency unit or composite
currency, including, without limitation, the ECU, issued by the government of
one or more countries other than the United States of America or by any
recognized confederation or association of such governments.
"Funds from Operations" for any period means the consolidated net
income of the Company and its Subsidiaries for such period without giving effect
to depreciation and amortization, gains or losses from extraordinary items,
gains or losses on sales of real estate, gains or losses on investments in
marketable securities and any provision/benefit for income taxes for such
period, plus funds from operations of unconsolidated joint ventures, all
determined on a consistent basis in accordance with GAAP.
"GAAP" means generally accepted accounting principles in effect from
time to time as used in the United States applied on a consistent basis.
"Government Obligations" means securities which are (i) direct
obligations of the United States of America or the government which issued the
Foreign Currency in which the Securities of a particular series are payable, for
the payment of which its full faith and credit is pledged or (ii) obligations of
a Person controlled or supervised by and acting as an agency or instrumentality
of the United States of America or such government which issued the Foreign
Currency in which the Securities of such series are payable, the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States of America or such other government, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian with
respect to any such Government Obligation or a specific payment of interest on
or principal of any such Government Obligation held by such custodian for the
account of the holder of a depository receipt; provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment of
interest on or principal of the Government Obligation evidenced by such
depository receipt.
3
<PAGE>
"Holder" means, in the case of a Registered Security, the Person in
whose name a Security is registered in the Security Register and, in the case of
a Bearer Security, the bearer thereof and, when used with respect to any coupon,
shall mean 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 terms of particular series of Securities established as
contemplated by Section 301; provided, however, that, if at any time more than
one Person is acting as Trustee under this instrument, "Indenture" shall mean,
with respect to any one or more series of Securities for which such Person is
Trustee, this instrument as originally executed or as it may from time to time
be supplemented or amended by one or more applicable provisions hereof and shall
include the terms of the or those particular series of Securities for which such
Person is Trustee established as contemplated by Section 301, exclusive,
however, of any provisions or terms which relate solely to other series of
Securities for which such Person is Trustee, regardless of when such terms or
provisions were adopted, and exclusive of any provisions or terms adopted by
means of one or more indentures supplemental hereto executed and delivered after
such Person had become such Trustee but to which such Person, as such Trustee,
was not a party.
"Indexed Security" means a Security the terms of which provide that the
principal amount thereof payable at Stated Maturity may be more or less than the
principal face amount thereof at original issuance.
"interest", when used with respect to an Original Issue Discount
Security which by its terms bears interest only after Maturity, shall mean
interest payable after Maturity, and, when used with respect to a Security which
provides for the payment of Additional Amounts pursuant to Section 1007,
includes such Additional Amounts.
"Interest Payment Date", when used with respect to any Security, means
the Stated Maturity of an installment of interest on such Security.
"Maturity", when used with respect to any Security, means the date on
which the principal of such Security or an installment of principal becomes due
and payable as therein or herein provided, whether at the Stated Maturity or by
declaration of acceleration, notice of redemption, notice of option to elect
repayment or otherwise.
"Officers' Certificate" means a certificate signed by the President or
a Vice President and by the Treasurer, an Assistant Treasurer, 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
counsel for the Company (including counsel who is an employee of the Company)
and who shall be acceptable to the Trustee.
"Original Issue Discount Security" means any 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 Securities, means, as of the
date of determination, all Securities theretofore authenticated and delivered
under this Indenture, except:
(i) Securities theretofore canceled by the Trustee or
delivered to the Trustee for cancellation;
(ii) Securities, or portions thereof, for whose payment or
redemption or repayment at the option of the Holder 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 Securities and any coupons
appertaining thereto; provided that, if such 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;
(iii) Securities, except to the extent provided in Sections
1402 and 1403, with respect to which the Company has effected
defeasance and/or covenant defeasance as provided in Article 14;
(iv) Securities which have been paid pursuant to Section 306
or in exchange for or in lieu of which other Securities have been
authenticated and delivered pursuant to this Indenture, other than any
such
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Securities in respect of which there shall have been presented to the
Trustee proof satisfactory to it that such Securities are held by a
bona fide purchaser in whose hands such Securities are valid
obligations of the Company; and
(v) Securities converted into Common Shares, Preferred Shares
or other securities of the Company pursuant to or in accordance with
this Indenture if the terms of such Securities provide for
convertibility pursuant to Section 301;
provided, however, that in determining whether the Holders of the requisite
principal amount of the Outstanding Securities have given any request, demand,
authorization, direction, notice, consent or waiver hereunder or are present at
a meeting of Holders for quorum purposes, and for the purpose of making the
calculations required by TIA Section 313, (i) the principal amount of an
Original Issue Discount Security that may be counted in making such
determination or calculation and that shall be deemed to be Outstanding for such
purpose shall be equal to the amount of principal thereof that would be (or
shall have been declared to be) due and payable, at the time of such
determination, upon a declaration of acceleration of the maturity thereof
pursuant to Section 502, (ii) the principal amount of any Security denominated
in a Foreign Currency that may be counted in making such determination or
calculation and that shall be deemed Outstanding for such purpose shall be equal
to the Dollar equivalent, determined pursuant to Section 301 as of the date such
Security is originally issued by the Company, of the principal amount (or, in
the case of an Original Issue Discount Security, the Dollar equivalent as of
such date of original issuance of the amount determined as provided in clause
(i) above) of such Security, (iii) the principal amount of any Indexed Security
that may be counted in making such determination or calculation and that shall
be deemed outstanding for such purpose shall be equal to the principal face
amount of such Indexed Security at original issuance, unless otherwise provided
with respect to such Security pursuant to Section 301, and (iv) Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or of such other obligor shall be disregarded and deemed not to be
Outstanding, except that, in determining whether the Trustee shall be protected
in making such calculation or in relying upon any such request, demand,
authorization, direction, notice, consent or waiver, only Securities which the
Trustee knows to be so owned shall be so disregarded. 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 Securities and that the pledgee is not the Company or any
other obligor upon the Securities or any Affiliate of the Company or of such
other obligor.
"Paying Agent" means any Person authorized by the Company to pay the
principal of (and premium, if any) or interest on any Securities or coupons on
behalf of the Company.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, limited liability company,
unincorporated organization or government or any agency or political subdivision
thereof.
"Place of Payment", when used with respect to the Securities of or
within any series, means the place or places where the principal of (and
premium, if any) and interest on such Securities are payable as specified as
contemplated by Sections 301 and 1002.
"Predecessor Security" of any particular Security means every previous
Security evidencing all or a portion of the same debt as that evidenced by such
particular Security; and, for the purposes of this definition, any Security
authenticated and delivered under Section 306 in exchange for or in lieu of a
mutilated, destroyed, lost or stolen Security or a Security to which a
mutilated, destroyed, lost or stolen coupon appertains shall be deemed to
evidence the same debt as the mutilated, destroyed, lost or stolen Security or
the Security to which the mutilated, destroyed, lost or stolen coupon
appertains.
"Redemption Date", when used with respect to any Security to be
redeemed, in whole or in part, means the date fixed for such redemption by or
pursuant to this Indenture.
"Redemption Price", when used with respect to any Security to be
redeemed, means the price at which it is to be redeemed pursuant to this
Indenture.
"Registered Security" shall mean any Security established pursuant to
Section 201 which is registered in the Security Register.
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"Regular Record Date" for the interest payable on any Interest Payment
Date on the Registered Securities of or within any series means the date
specified for that purpose as contemplated by Section 301, whether or not a
Business Day.
"Repayment Date" means, when used with respect to any Security to be
repaid at the option of the Holder, the date fixed for such repayment by or
pursuant to this Indenture.
"Responsible Officer", when used with respect to the Trustee, means the
chairman or vice-chairman of the board of directors, the chairman or
vice-chairman of the executive committee of the board of directors, the
president, any vice president (whether or not designated by a number or a word
or words added before or after the title "vice president"), the secretary, any
assistant secretary, the treasurer, any assistant treasurer, the cashier, any
assistant cashier, any trust officer, the controller or any other officer of the
Trustee customarily performing functions similar to those performed by any of
the above designated officers and also means with respect to a particular
corporate trust matter, any other officer to whom such matter is referred
because of such officer's knowledge and familiarity with the particular subject.
"Security" has the meaning stated in the first recital of this
Indenture and, more particularly, means any Security or Securities authenticated
and delivered under this Indenture; provided, however, that, if at any time
there is more than one Person acting as Trustee under this Indenture,
"Securities" with respect to the Indenture as to which such Person is Trustee
shall have the meaning stated in the first recital of this Indenture and shall
more particularly mean Securities authenticated and delivered under this
Indenture, exclusive, however, of Securities of any series as to which such
Person is not Trustee.
"Security Register" and "Security Registrar" have the respective
meanings specified in Section 305.
"Significant Subsidiary" means any Subsidiary which is a "significant
subsidiary" (as defined in Article I, Rule 1-02 of Regulation S-X, promulgated
under the Securities Act of 1933, as amended) of the Company.
"Special Record Date" for the payment of any Defaulted Interest on the
Registered Securities of or within any series means a date fixed by the Trustee
pursuant to Section 307.
"Stated Maturity", when used with respect to any Security or any
installment of principal thereof or interest thereon, means the date specified
in such Security or a coupon representing such installment of interest as the
fixed date on which the principal of such Security or such installment of
principal or interest is due and payable.
"Subsidiary" means a corporation a majority of the outstanding voting
stock of which is owned, directly or indirectly, by the Company or by one or
more other Subsidiaries of the Company. For the purposes of this definition,
"voting stock" means stock having voting power for the election of directors,
whether at all times or only so long as no senior class of stock has such voting
power by reason of any contingency.
"Trust Indenture Act" or "TIA" means the Trust Indenture Act of 1939,
as amended and as in force at the date as of which this Indenture was executed,
except as provided in Section 905.
"Trustee" means the Person named as the "Trustee" in the first
paragraph of this Indenture until a successor Trustee shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Trustee" shall mean or include each Person who is then a Trustee hereunder;
provided, however, that if at any time there is more than one such Person,
"Trustee" as used with respect to the Securities of any series shall mean only
the Trustee with respect to Securities of that series.
"United States" means, unless otherwise specified with respect to any
Securities pursuant to Section 301, the United States of America (including the
states and the District of Columbia), its territories, its possessions and other
areas subject to its jurisdiction.
"United States person" means, unless otherwise specified with respect
to any Securities pursuant to Section 301, an individual who is a citizen or
resident of the United States, a corporation, partnership or other entity
created organized in or under the laws of the United States or an estate or
trust the income of which is subject to United States federal income taxation
regardless of its source.
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"Yield to Maturity" means the yield to maturity, computed at the time
of issuance of a Security (or, if applicable, at the most recent redetermination
of interest on such Security) and as set forth in such Security in accordance
with generally accepted United States bond yield computation principles.
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 (including certificates
delivered pursuant to Section 1006) shall include:
(1) a statement that each individual signing such certificate
or opinion has read such condition or covenant 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,
he has made such examination or investigation as is necessary to enable
him to express an informed opinion as to whether or not such condition
or covenant 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.
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
as 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 an Opinion of Counsel, or a
certificate of or representations by counsel, unless such officer knows, or in
the exercise of reasonable care should know, that the opinion, certificate or
representations with respect to the matters upon which his certificate or
opinion is based are erroneous. Any such Opinion of Counsel, certificate or
representations 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 or any Subsidiary stating that the information as to such factual
matters is in the possession of the Company or such Subsidiary, unless such
counsel knows that the certificate or opinion or representations as 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 of the Outstanding Securities of all series or one or more series, as
the case may be, may be embodied in and evidenced by one or more instruments of
substantially similar tenor signed by such Holders in person or by agents duly
appointed in writing. If Securities of a series are issuable as Bearer
Securities, any request, demand, authorization, direction, notice, consent,
waiver or other action provided by this Indenture to be given or taken by
Holders of Securities of such series may, alternatively, be embodied in and
evidenced by the record of Holders of Securities of such series voting in favor
thereof, either in person or by proxies duly appointed in writing, at
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any meeting of Holders of Securities of such series duly called and held in
accordance with the provisions of Article 15, or a combination of such
instruments and any such record. Except as herein otherwise expressly provided,
such action shall become effective when such instrument or instruments or record
or both are delivered to the Trustee and, where it is hereby expressly required,
to the Company. Such instrument or instruments and any such record (and the
action embodied therein and evidenced thereby) are herein sometimes referred to
as the "Act" of the Holders signing such instrument or instruments or so voting
at any such meeting. Proof of execution of any such instrument or of a writing
appointing any such agent, or of the holding by any Person of a Security, shall
be sufficient for any purpose of this Indenture and 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. The record of any meeting of Holders of
Securities shall be proved in the manner provided in Section 1506.
(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 a certificate of a 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 signer acting in a capacity other than his individual
capacity, such certificate or affidavit shall also constitute sufficient proof
of his authority. The fact and date of the execution of any such instrument or
writing, or the authority of the Person executing the same, may also be proved
in any other reasonable manner which the Trustee deems sufficient.
(c) The ownership of Registered Securities shall be proved by the
Security Register.
(d) The ownership of Bearer Securities may be proved by the production
of such Bearer Securities 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 Trustee to be satisfactory, showing that at
the date therein mentioned such Person had on deposit with such depositary, or
exhibited to it, the Bearer Securities therein described; or such facts may be
proved by the certificate or affidavit of the Person holding such Bearer
Securities, if such certificate or affidavit is deemed by the Trustee to be
satisfactory. The Trustee and the Company may assume that such ownership of any
Bearer Security continues until (1) another certificate or affidavit bearing a
later date issued in respect of the same Bearer Security is produced, or (2)
such Bearer Security is produced to the Trustee by some other Person, or (3)
such Bearer Security is surrendered in exchange for a Registered Security, or
(4) such Bearer Security is no longer Outstanding. The ownership of Bearer
Securities may also be proved in any other manner which the Trustee deems
sufficient.
(e) If the Company shall solicit from the Holders of Registered
Securities any request, demand, authorization, direction, notice, consent,
waiver or other Act, the Company may, at its option, in or pursuant to a 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.
Notwithstanding TIA Section 316(c), such record date shall be the record date
specified in or pursuant to such Board Resolution, which shall be a date not
earlier than the date 30 days prior to the first solicitation of Holders
generally in connection therewith and not later than the date such solicitation
is completed. 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 of record 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
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 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 eleven months after the
record date.
(f) Any request, demand, authorization, direction, notice, consent,
waiver or other Act of the Holder of any Security shall bind every future Holder
of the same Security and the Holder of every Security issued upon the
registration of transfer thereof or in exchange therefor or in lieu thereof in
respect of anything done, omitted or suffered to be done by the Trustee, any
Security Registrar, any Paying Agent, any Authenticating Agent or the Company in
reliance thereon, whether or not notation of such action is made upon such
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,
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(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,
Attention: Corporate Trust Department Re: Health and Retirement
Properties Trust Notes due 2002; or
(2) the Company by the Trustee or by any Holder shall be
sufficient for every purpose hereunder (unless otherwise herein
expressly provided) if in writing and mailed, first class postage
prepaid, to the Company addressed to it at the address of its principal
office specified in the first paragraph of this Indenture or at any
other address previously furnished in writing to the Trustee by the
Company.
Section 106. Notice to Holders; Waiver. Where this Indenture provides
for notice of any event to Holders of Registered Securities by the Company or
the Trustee, such notice shall be sufficiently given (unless otherwise herein
expressly provided) if in writing and mailed, first-class postage prepaid, to
each such Holder affected by such event, at his address as it appears in the
Security 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 of Registered Securities 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
of Registered Securities or the sufficiency of any notice to Holders of Bearer
Securities given as provided herein. Any notice mailed to a Registered Holder in
the manner herein prescribed shall be conclusively deemed to have been received
by such Holder, whether or not such Holder actually receives such notice.
If by reason of the suspension of or irregularities in regular mail
service or by reason of any other cause it shall be impracticable to give such
notice by mail, then such notification to Holders of Registered Securities as
shall be made with the approval of the Trustee shall constitute a sufficient
notification to such Holders for every purpose hereunder.
Except as otherwise expressly provided herein or otherwise specified
with respect to any Securities pursuant to Section 301, where this Indenture
provides for notice to Holders of Bearer Securities of any event, such notice
shall be sufficiently given if published in an Authorized Newspaper in The City
of New York and in such other city or cities as may be specified in such
Securities on a Business Day, such publication to be not later than the latest
date, and not earlier than the earliest date, prescribed for the giving of such
notice. Any such notice shall be deemed to have been given on the date of such
publication or, if published more than once, on the date of the first such
publication.
If by reason of the suspension of publication of any Authorized
Newspaper or Authorized Newspapers or by reason of any other cause it shall be
impracticable to publish any notice to Holders of Bearer Securities as provided
above, then such notification to Holders of Bearer Securities as shall be given
with the approval of the Trustee shall constitute sufficient notice to such
Holders for every purpose hereunder. Neither the failure to give notice by
publication to any particular Holder of Bearer Securities as provided above, nor
any defect in any notice so published, shall affect the sufficiency of such
notice with respect to other Holders of Bearer Securities or the sufficiency of
any notice to Holders of Registered Securities given as provided herein.
Any request, demand, authorization, direction, notice, consent or
waiver required or permitted under this Indenture shall be in the English
language, except that any published notice may be in an official language of the
country of publication.
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.
Section 107. 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 108. Successors and Assigns. All covenants and agreements in
this Indenture by the Company shall bind its successors and assigns, whether so
expressed or not.
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Section 109. Separability Clause. In case any provision in this
Indenture or in any Security or coupon 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 110. Benefits of Indenture. Nothing in this Indenture or in the
Securities or coupons, express or implied, shall give to any Person, other than
the parties hereto, any Security Registrar, any Paying Agent, any Authenticating
Agent and their successors hereunder and the Holders any benefit or any legal or
equitable right, remedy or claim under this Indenture.
Section 111. Governing Law. This Indenture and the Securities and
coupons shall be governed by and construed in accordance with the law of The
Commonwealth of Massachusetts. This Indenture is subject to the provisions of
the TIA that are required to be part of this Indenture and shall, to the extent
applicable, be governed by such provisions.
Section 112. Legal Holidays. In any case where any Interest Payment
Date, Redemption Date, Repayment Date, sinking fund payment date, Stated
Maturity or Maturity of any Security shall not be a Business Day at any Place of
Payment, then (notwithstanding any other provision of this Indenture or any
Security or coupon other than a provision in the Securities of any series which
specifically states that such provision shall apply in lieu hereof), payment of
interest or any Additional Amounts or principal (and premium, if any) or sinking
fund payment need not be made at such Place of Payment on such date, 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, Redemption Date,
Repayment Date or sinking fund payment date, or at the Stated Maturity or
Maturity; provided that no interest shall accrue on the amount so payable for
the period from and after such Interest Payment Date, Redemption Date, Repayment
Date, sinking fund payment date, Stated Maturity or Maturity, as the case may
be.
Section 113. No Personal Liability. THE AMENDED AND RESTATED
DECLARATION OF TRUST OF THE COMPANY, DATED JULY 1, 1994, A COPY OF WHICH,
TOGETHER WITH ALL AMENDMENTS THERETO (THE "DECLARATION"), IS DULY FILED IN THE
OFFICE OF THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF MARYLAND,
PROVIDES THAT THE NAME "HEALTH AND RETIREMENT PROPERTIES TRUST" REFERS TO THE
TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS TRUSTEES, BUT NOT INDIVIDUALLY OR
PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE OR AGENT OF THE
COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR SEVERALLY, FOR ANY
OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY. ALL PERSONS DEALING WITH THE
COMPANY, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THE COMPANY FOR THE
PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
ARTICLE 2
SECURITIES FORMS
Section 201. Forms of Securities. The Registered Securities, if any, of
each series and the Bearer Securities, if any, of each series and related
coupons shall be in substantially the forms as shall be established in one or
more indentures supplemental hereto or approved from time to time by or pursuant
to a Board Resolution in accordance with Section 301, shall have such
appropriate insertions, omissions, substitutions and other variations as are
required or permitted by this Indenture or any indenture supplemental hereto,
and may have such letters, numbers or other marks of identification or
designation and such legends or endorsements placed thereon as the Company may
deem appropriate and as are not inconsistent with the provisions of this
Indenture, or as may be required to comply with any law or with any rule or
regulation made pursuant thereto or with any rule or regulation of any
securities exchange on which the Securities may be listed, or to conform to
usage.
Unless otherwise specified as contemplated by Section 301, Bearer
Securities shall have interest coupons attached.
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The definitive Securities and coupons shall be printed, lithographed or
engraved or produced by any combination of these methods on a steel engraved
border or steel engraved borders or may be produced in any other manner, all as
determined by the officers of the Company executing such Securities or coupons,
as evidenced by their execution of such Securities or coupons.
Section 202. Form of Trustee's Certificate of Authentication. Subject
to Section 611, the Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated therein referred
to in the within-mentioned Indenture.
---------------------------------
as Trustee
By______________________________
Authorized Officer
Section 203. Securities Issuable in Global Form. If Securities of or
within a series are issuable in global form, as specified in and as contemplated
by Section 301, then, notwithstanding clause (8) of Section 301 and the
provisions of Section 302, any such Security shall represent such of the
Outstanding Securities of such series as shall be specified therein and may
provide that it shall represent the aggregate amount of Outstanding Securities
of such series from time to time endorsed thereon and that the aggregate amount
of Outstanding Securities of such series represented thereby may from time to
time be increased or decreased to reflect exchanges. Any endorsement of a
Security in global form to reflect the amount, or any increase or decrease in
the amount, of Outstanding 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 304. Subject to the provisions of Section 303
and, if applicable, Section 304, the Trustee shall deliver and redeliver any
Security in permanent global form 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 Security in global form shall be in writing but need
not comply with Section 102 and need not be accompanied by an Opinion of
Counsel.
The provisions of the last sentence of Section 303 shall apply to any
Security represented by a Security in global form if such Security was never
issued and sold by the Company and the Company delivers to the Trustee the
Security in global form together with written instructions (which need not
comply with Section 102 and need not be accompanied by an Opinion of Counsel)
with regard to the reduction in the principal amount of Securities represented
thereby, together with the written statement contemplated by the last sentence
of Section 303.
Notwithstanding the provisions of Section 307, unless otherwise
specified as contemplated by Section 301, payment of principal of and any
premium and interest on any Security in permanent global form 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 as the Holder of such principal amount of
Outstanding Securities represented by a permanent global Security (i) in the
case of a permanent global Security in registered form, the Holder of such
permanent global Security in registered form or (ii) in the case of a permanent
global Security in bearer form, Euroclear or CEDEL.
ARTICLE 3
THE SECURITIES
Section 301. Amount Unlimited; Issuable in Series. The aggregate
principal amount of Securities which may be authenticated and delivered under
this Indenture is unlimited.
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The Securities may be issued in one or more series. There shall be
established in one or more Board Resolutions or pursuant to authority granted by
one or more Board Resolutions and, subject to Section 303 set forth, or
determined in the manner provided, in an Officers' Certificate, or established
in one or more indentures supplemental hereto, prior to the issuance of
Securities of any series, any or all of the following, as applicable (each of
which (except for the matters set forth in clauses (1), (2) and (14) below), if
so provided, may be determined from time to time by the Company with respect to
unissued Securities of the series when issued from time to time):
(1) the title of the Securities of the series (which shall
distinguish the Securities of such series from all other series of
Securities);
(2) any limit upon the aggregate principal amount of the
Securities of the series that may be authenticated and delivered under
this Indenture (except for Securities authenticated and delivered upon
registration of transfer of, or in exchange for, or in lieu of, other
Securities of the series pursuant to Section 304, 305, 306, 906, 1107
or 1305);
(3) the date or dates, or the method by which such date or
dates will be determined, on which the principal of the Securities of
the series shall be payable;
(4) the rate or rates at which the Securities of the series
shall bear interest, if any, or the method by which such rate or rates
shall be determined, the date or dates from which such interest shall
accrue or the method by which such date or dates shall be determined,
the Interest Payment Dates on which such interest will be payable and
the Regular Record Date, if any, for the interest payable on any
Registered Security on any Interest Payment Date, or the method by
which such date shall be determined, and the basis upon which interest
shall be calculated if other than that of a 360-day year of twelve
30-day months;
(5) the place or places where the principal of, any premium
and interest on and any Additional Amounts payable in respect of,
Securities of the series shall be payable, any Registered Securities of
the series may be surrendered for registration of transfer, exchange or
conversion and notices or demands to or upon the Company in respect of
the Securities of the series and this Indenture may be served;
(6) the period or periods within which or the date or dates on
which, the price or prices at which, and other terms and conditions
upon which Securities of the series may be redeemed, in whole or in
part, at the option of the Company, if the Company is to have the
option;
(7) the obligation, if any, of the Company to redeem, repay or
purchase Securities of the series pursuant to any sinking fund or
analogous provision or at the option of a Holder thereof, and the
period or periods within which or the date or dates on which, the price
or prices at which, and other terms and conditions upon which
Securities of the series shall be redeemed, repaid or purchased, in
whole or in part, pursuant to such obligation;
(8) if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Registered Securities
of the series shall be issuable and the denomination or denominations
in which any Bearer Securities of the series shall be issuable;
(9) if other than Dollars, the Foreign Currency or Currencies
in which payment of the principal of (and premium, if any), interest,
if any, on, and Additional Amounts, if any, on the Securities of the
series shall be payable, in which the Securities of the series shall be
redeemed or purchased or in which the Securities of the series shall be
denominated;
(10) if other than the principal amount thereof, the portion
of the principal amount of Securities of the series that shall be
payable upon declaration of acceleration of the Maturity thereof
pursuant to Section 502 or, if applicable, the portion of the principal
amount of Securities of the series that is convertible in accordance
with the provisions of this Indenture, or the method by which such
portion shall be determined;
(11) whether the amount of payments of principal of (and
premium, if any) or interest, if any, on the Securities of the series
may be determined with reference to an index, formula or other method
(which
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index, formula or method may be based, without limitation, on one or
more currencies, currency units, composite currencies, commodities,
equity indices or other indices), and the manner in which such amounts
shall be determined;
(12) whether the principal of (and premium, if any) or
interest, if any on or Additional Amounts, if any, on the Securities of
the series are to be payable, at the election of the Company or a
Holder thereof, in a currency or currencies, currency unit or units or
composite currency or currencies other than that in which such
Securities are denominated or stated to be payable, the period or
periods within which, and the terms and conditions upon which, such
election may be made, and the time and manner of, and identity of the
exchange rate agent with responsibility for determining the exchange
rate between the currency or currencies, currency unit or units or
composite currency or currencies in which such Securities are
denominated or stated to be payable and the currency or currencies,
currency unit or units or composite currency or currencies in which
such Securities are to be paid;
(13) provisions, if any, granting special rights to the
Holders of Securities of the series upon the occurrence of such events
as may be specified;
(14) any deletions from, modifications of or additions to the
Events of Default or covenants of the Company set forth in this
Indenture with respect to Securities of the series (whether or not such
Events of Default or covenants are consistent with the Events of
Default or covenants set forth herein);
(15) whether Securities of the series are to be issuable as
Registered Securities, Bearer Securities (with or without coupons) or
both, any restrictions applicable to the offer, sale or delivery of
Bearer Securities and the terms upon which Bearer Securities of the
series may be exchanged for Registered Securities of the series and
vice versa (if permitted by applicable laws and regulations), whether
any Securities of the series are to be issuable initially in temporary
global form and whether any Securities of the series are to be issuable
in permanent global form with or without coupons and, if so, whether
beneficial owners of interests in any such permanent global Security
may exchange such interests for Securities of such series and of like
tenor 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, and, if Registered Securities of the series
are to be issuable as a global Security, the identity of the depositary
for such series;
(16) the date as of which any Bearer Securities of the series
and any temporary global Security representing Outstanding Securities
of the series shall be dated if other than the date of original
issuance of the first Security of the series to be issued;
(17) the Person to whom any interest on any Registered
Security of the series shall be payable, if other than the Person in
whose name that Security (or one or more Predecessor Securities) is
registered at the close of business on the Regular Record Date for such
interest, the manner in which, or the Person to whom, any interest on
any Bearer Security of the series shall be payable, if otherwise than
upon presentation and surrender of the coupons appertaining thereto as
they severally mature, and the extent to which, or the manner in which,
any interest payable on a temporary global Security on an Interest
Payment Date will be paid if other than in the manner provided in
Section 304;
(18) the applicability, if any, of Sections 1402 and/or 1403
to the Securities of the series and any provisions in modification of,
in addition to or in lieu of any of the provisions of Article 14;
(19) if the Securities of such series are to be issuable in
definitive form (whether upon original issue or upon exchange of a
temporary Security of such series) only upon receipt of certain
certificates or other documents or satisfaction of other conditions,
then the form and/or terms of such certificates, documents or
conditions;
(20) if the Securities of the series are to be issued upon the
exercise of warrants, the time, manner and place for such Securities to
be authenticated and delivered;
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(21) whether and under what circumstances the Company will pay
Additional Amounts as contemplated by Section 1007 on the Securities of
the series to any Holder who is not a United States person (including
any modification to the definition of such term) in respect of any tax,
assessment or governmental charge and, if so, whether the Company will
have the option to redeem such Securities rather than pay such
Additional Amounts (and the terms of any such option);
(22) the obligation, if any, of the Company to permit the
conversion of the Securities of such series into Common Shares or
Preferred Shares of the Company or other securities, as the case may
be, and the terms and conditions upon which such conversion shall be
effected (including, without limitation, the initial conversion price
or rate, the conversion period, any adjustment of the applicable
conversion price and any requirements relative to the reservation of
such shares for purposes of conversion);
(23) the terms and conditions, if any, upon which payment of
the Securities of such series shall be subordinated to the Securities
of another series or other indebtedness of the Company (including,
without limitation, indebtedness which ranks senior to such Securities;
restrictions on payments to Holders of such Securities while a default
with respect to such senior indebtedness is continuing; restrictions,
if any, on payments to the Holders of such Securities following an
Event of Default; and any requirements for Holders of such Securities
to remit certain payments to the holders of such senior indebtedness);
(24) if the Securities of the series are to be guaranteed, the
term and conditions of such guarantee;
(25) if other than the Trustee, the identity of each Security
Registrar and/or Paying Agent for the series; and
(26) any other terms of the series (which terms shall not be
inconsistent with the provisions of this Indenture).
All Securities of any one series and the coupons appertaining to any
Bearer Securities of such series shall be substantially identical except, in the
case of Registered Securities, as to denominations and except as may otherwise
be provided in or pursuant to the Board Resolution establishing the series
(subject to Section 303) and set forth in an Officers' Certificate or in any
indenture supplemental hereto. All Securities of any one series need not be
issued at the same time and, unless otherwise provided, a series may be
reopened, without the consent of the Holders, for issuances of additional
Securities of such series.
If any of the terms of the Securities of any series are established by
action taken pursuant to one or more Board Resolutions, a copy of an appropriate
record of such action(s) shall be certified by the Secretary or an Assistant
Secretary of the Company and delivered to the Trustee at or prior to the
delivery of the Officers' Certificate setting forth the terms of the Securities
of such series.
Section 302. Denominations. The Securities of each series shall be
issuable in such denominations as shall be specified as contemplated by Section
301. With respect to Securities of any series denominated in Dollars, in the
absence of any such provisions, the Registered Securities of such series, other
than Registered Securities issued in global form (which may be of any
denomination), shall be issuable in denominations of $1,000 and any integral
multiple thereof.
Section 303. Execution, Authentication, Delivery and Dating. The
Securities and any coupons appertaining thereto shall be executed on behalf of
the Company by its President or one of its Vice Presidents, under its seal
reproduced thereon, and attested by its Secretary or one of its Assistant
Secretaries. The signature of any of these officers on the Securities and
coupons may be manual or facsimile signatures of the present or any future such
authorized officer and may be imprinted or otherwise reproduced on the
Securities.
Securities or coupons 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 Securities or
did not hold such offices at the date of such Securities or coupons.
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At any time and from time to time after the execution and delivery of
this Indenture, the Company may deliver Securities of any series, together with
any coupon appertaining thereto, executed by the Company to the Trustee for
authentication, together with a Company Order for the authentication and
delivery of such Securities, and the Trustee in accordance with the Company
Order shall authenticate and deliver such Securities; provided, however, that,
in connection with its original issuance, no Bearer Security shall be mailed or
otherwise delivered to any location in the United States; and provided further
that, unless otherwise specified with respect to any series of Securities
pursuant to Section 301, a Bearer Security may be delivered in connection with
its original issuance only if the Person entitled to receive such Bearer
Security shall have furnished a certificate in the form set forth in Exhibit A-1
to this Indenture or such other certificate as may be specified with respect to
any series of Securities pursuant to Section 301, dated no earlier than 15 days
prior to the earlier of the date on which such Bearer Security is delivered and
the date on which any temporary Security first becomes exchangeable for such
Bearer Security in accordance with the terms of such temporary Security and this
Indenture. If any Security shall be represented by a permanent global Bearer
Security, then, for purposes of this Section and Section 304, the notation of a
beneficial owner's interest therein upon original issuance of such Security or
upon exchange of a portion of a temporary global Security shall be deemed to be
delivery in connection with its original issuance of such beneficial owner's
interest in such permanent global Security. Except as permitted by Section 306,
the Trustee shall not authenticate and deliver any Bearer Security unless all
appurtenant coupons for interest then matured have been detached and canceled.
If all the Securities of any series are not to be issued at one time and if the
Board Resolution or supplemental indenture establishing such series shall so
permit, such Company Order may set forth procedures acceptable to the Trustee
for the issuance of such Securities and determining the terms of particular
Securities of such series, such as interest rate or formula, maturity date, date
of issuance and date from which interest shall accrue. In authenticating such
Securities, and accepting the additional responsibilities under this Indenture
in relation to such Securities, the Trustee shall be entitled to receive, and
(subject to TIA Sections 315(a) through 315(d)) shall be fully protected in
relying upon,
(i) an Opinion of Counsel stating that
(a) the form or forms of such Securities and any
coupons have been established in conformity with the
provisions of this Indenture;
(b) the terms of such Securities and any coupons have
been established in conformity with the provisions of this
Indenture; and
(c) such Securities, together with any coupons
appertaining thereto, when completed by appropriate insertions
and executed and delivered by the Company to the Trustee for
authentication in accordance with this Indenture,
authenticated and delivered by the Trustee in accordance with
this Indenture and issued by the Company in the manner and
subject to any conditions specified in such Opinion of
Counsel, will constitute legal, valid and binding obligations
of the Company, enforceable in accordance with their terms,
subject to applicable bankruptcy, insolvency, reorganization
and other similar laws of general applicability relating to or
affecting the enforcement of creditors' rights generally and
to general equitable principles; and
(ii) an Officers' Certificate stating that all conditions
precedent provided for in this Indenture relating to the issuance of
the Securities have been complied with and that, to the best of the
knowledge of the signers of such certificate, no Event of Default with
respect to any of the Securities shall have occurred and be continuing.
If such form or terms have been so established, the Trustee shall not be
required to authenticate such Securities if the issue of such Securities
pursuant to this Indenture will affect the Trustee's own rights, duties,
obligations or immunities under the Securities and this Indenture or otherwise
in a manner which is not reasonably acceptable to the Trustee.
Notwithstanding the provisions of Section 301 and of the preceding
paragraph, if all the Securities of any series are not to be issued at one time,
it shall not be necessary to deliver an Officers' Certificate otherwise required
pursuant to Section 301 or a Company Order, or an Opinion of Counsel or an
Officers' Certificate otherwise required pursuant to the preceding paragraph at
the time of issuance of each Security of such series, but such order, opinion
and certificates, with appropriate modifications to cover such future issuances,
shall be delivered at or before the time of issuance of the first Security of
such series.
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Each Registered Security shall be dated the date of its authentication
and each Bearer Security shall be dated as of the date specified as contemplated
by Section 301.
No Security or coupon shall be entitled to any benefit under this
Indenture or be valid or obligatory for any purpose unless there appears on such
Security or Security to which such coupon appertains a certificate of
authentication substantially in the form provided for herein duly executed by
the Trustee by manual signature of an authorized officer, and such certificate
upon any Security shall be conclusive evidence, and the only evidence, that such
Security has been duly authenticated and delivered hereunder and is entitled to
the benefits of this Indenture. Notwithstanding the foregoing, if any Security
shall have been authenticated and delivered hereunder but never issued and sold
by the Company, and the Company shall deliver such Security to the Trustee for
cancellation as provided in Section 309 together with a written statement (which
need not comply with Section 102 and need not be accompanied by an Opinion of
Counsel) stating that such Security has never been issued and sold by the
Company, for all purposes of this Indenture such Security shall be deemed never
to have been authenticated and delivered hereunder and shall never be entitled
to the benefits of this Indenture.
Section 304. Temporary Securities.
(a) Pending the preparation of definitive Securities of any series, the
Company may execute, and upon Company Order the Trustee shall authenticate and
deliver, temporary Securities which are printed, lithographed, typewritten,
mimeographed or otherwise produced, in any authorized denomination,
substantially of the tenor of the definitive Securities in lieu of which they
are issued, in registered form, or, if authorized, in bearer form with one or
more coupons or without coupons, and with such appropriate insertions,
omissions, substitutions and other variations as the officers executing such
Securities may determine, as conclusively evidenced by their execution of such
Securities. In the case of Securities of any series, such temporary Securities
may be in global form.
Except in the case of temporary Securities in global form (which shall
be exchanged in accordance with Section 304(b) or as otherwise provided in or
pursuant to a Board Resolution), if temporary Securities of any series are
issued, the Company will cause definitive Securities of that series to be
prepared without unreasonable delay. After the preparation of definitive
Securities of such series, the temporary Securities of such series shall be
exchangeable for definitive Securities of such series upon surrender of the
temporary Securities of such series at the office or agency of the Company in a
Place of Payment for that series, without charge to the Holder. Upon surrender
for cancellation of any one or more temporary Securities of any series
(accompanied by any non-matured coupons appertaining thereto), the Company shall
execute and the Trustee shall authenticate and deliver in exchange therefor a
like principal amount of definitive Securities of the same series of authorized
denominations; provided, however, that no definitive Bearer Security shall be
delivered in exchange for a temporary Registered Security; and provided further
that a definitive Bearer Security shall be delivered in exchange for a temporary
Bearer Security only in compliance with the conditions set forth in Section 303.
Until so exchanged, the temporary Securities of any series shall in all respects
be entitled to the same benefits under this Indenture as definitive Securities
of such series.
(b) Unless otherwise provided in or pursuant to a Board Resolution,
this Section 304(b) shall govern the exchange of temporary Securities issued in
global form other than through the facilities of DTC. If any such temporary
Security is issued in global form, then such temporary global Security shall,
unless otherwise provided therein, be delivered to the London office of a
depositary or common depositary (the "Common Depositary"), for the benefit of
Euroclear and CEDEL, for credit to the respective accounts of the beneficial
owners of such Securities (or to such other accounts as they may direct).
Without unnecessary delay but in any event not later than the date
specified in, or determined pursuant to the terms of, any such temporary global
Security (the "Exchange Date"), the Company shall deliver to the Trustee
definitive Securities, in aggregate principal amount equal to the principal
amount of such temporary global Security, executed by the Company. On or after
the Exchange Date, such temporary global Security shall be surrendered by the
Common Depositary to the Trustee, as the Company's agent for such purpose, to be
exchanged, in whole or from time to time in part, for definitive Securities
without charge, and the Trustee shall authenticate and deliver, in exchange for
each portion of such temporary global Security, an equal aggregate principal
amount of definitive Securities of the same series of authorized denominations
and of like tenor as the portion of such temporary global Security to be
exchanged. The definitive Securities to be delivered in exchange for any such
temporary global Security shall be in bearer form, registered form, permanent
global bearer form or permanent global registered form, or any combination
thereof, as
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specified as contemplated by Section 301, and, if any combination thereof is so
specified, as requested by the beneficial owner thereof; provided, however,
that, unless otherwise specified in such temporary global Security, upon such
presentation by the Common Depositary, such temporary global Security is
accompanied by a certificate dated the Exchange Date or a subsequent date and
signed by Euroclear as to the portion of such temporary global Security held for
its account then to be exchanged and a certificate dated the Exchange Date or a
subsequent date and signed by CEDEL as to the portion of such temporary global
Security held for its account then to be exchanged, each in the form set forth
in Exhibit A-2 to this Indenture or in such other form as may be established
pursuant to Section 301; and provided further that definitive Bearer Securities
shall be delivered in exchange for a portion of a temporary global Security only
in compliance with the requirements of Section 303.
Unless otherwise specified in such temporary global Security, the
interest of a beneficial owner of Securities of a series in a temporary global
Security shall be exchanged for definitive Securities of the same series and of
like tenor following the Exchange Date when the account holder instructs
Euroclear or CEDEL, as the case may be, to request such exchange on his behalf
and delivers to Euroclear or CEDEL, as the case may be, a certificate in the
form set forth in Exhibit A-1 to this Indenture (or in such other forms as may
be established pursuant to Section 301), dated no earlier than 15 days prior to
the Exchange Date, copies of which certificate shall be available from the
offices of Euroclear and CEDEL, the Trustee, any Authenticating Agent appointed
for such series of Securities and each Paying Agent. Unless otherwise specified
in such temporary global Security, any such exchange shall be made free of
charge to the beneficial owners of such temporary global Security, except that a
Person receiving definitive Securities must bear the cost of insurance, postage,
transportation and the like unless such Person takes delivery of such definitive
Securities in person at the offices of Euroclear or CEDEL. Definitive Securities
in bearer form to be delivered in exchange for any portion of a temporary global
Security shall be delivered only outside the United States.
Until exchanged in full as hereinabove provided, the temporary
Securities of any series shall in all respects be entitled to the same benefits
under this Indenture as definitive Securities of the same series and of like
tenor authenticated and delivered hereunder, except that, unless otherwise
specified as contemplated by Section 301, interest payable on a temporary global
Security on an Interest Payment Date for Securities of such series occurring
prior to the applicable Exchange Date shall be payable to Euroclear and CEDEL on
such Interest Payment Date upon delivery by Euroclear and CEDEL to the Trustee
of a certificate or certificates in the form set forth in Exhibit A-2 to this
Indenture (or in such other forms as may be established pursuant to Section
301), for credit without further interest on or after such Interest Payment Date
to the respective accounts of persons who are the beneficial owners of such
temporary global Security on such Interest Payment Date and who have each
delivered to Euroclear or CEDEL, as the case may be, a certificate dated no
earlier than 15 days prior to the Interest Payment Date occurring prior to such
Exchange Date in the form set forth as Exhibit A-1 to this Indenture (or in such
other forms as may be established pursuant to Section 301). Notwithstanding
anything to the contrary herein contained, the certifications made pursuant to
this paragraph shall satisfy the certification requirements of the preceding two
paragraphs of this Section 304(b) and of the third paragraph of Section 303 of
this Indenture and the interests of the Persons who are the beneficial owners of
a temporary global Security with respect to which such certification was made
will be exchanged for definitive Securities of the same series and of like tenor
on the Exchange Date or the date of certification if such date occurs after the
Exchange Date, without further act or deed by such beneficial owners. Except as
otherwise provided in this paragraph, no payments of principal or interest owing
with respect to a beneficial interest in a temporary global Security will be
made unless and until such interest in such temporary global Security shall have
been exchanged for an interest in a definitive Security. Any interest so
received by Euroclear and CEDEL and not paid as herein provided shall be
returned to the Trustee prior to the expiration of two years after such Interest
Payment Date in order to be repaid to the Company.
Section 305. Registration, Registration of Transfer and Exchange. The
Company shall cause to be kept at the Corporate Trust Office of the Trustee or
in any office or agency of the Company in a Place of Payment a register for each
series of Securities (the registers maintained in such office or in any such
office or agency of the Company in a Place of Payment being herein sometimes
referred to collectively as the "Security Register") in which, subject to such
reasonable regulations as it may prescribe, the Company shall provide for the
registration of Registered Securities and of transfers of Registered Securities.
The Security Register shall be in written form or any other form capable of
being converted into written form within a reasonable time. The Trustee, at its
Corporate Trust Office, is hereby initially appointed "Security Registrar" for
the purpose of registering Registered Securities and transfers of Registered
Securities on such Security Register as herein provided. In the event that the
Trustee shall cease to be Security Registrar, it shall have the right to examine
the Security Register at all reasonable times.
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Subject to the provisions of this Section 305, upon surrender for
registration of transfer of any Registered Security of any series at any office
or agency of the Company in a Place of Payment for that series, the Company
shall execute, and the Trustee shall authenticate and deliver, in the name of
the designated transferee or transferees, one or more new Registered Securities
of the same series, of any authorized denominations and of a like aggregate
principal amount, bearing a number not contemporaneously outstanding, and
containing identical terms and provisions.
Subject to the provisions of this Section 305, at the option of the
Holder, Registered Securities of any series may be exchanged for other
Registered Securities of the same series, of any authorized denomination or
denominations and of a like aggregate principal amount, containing identical
terms and provisions, upon surrender of the Registered Securities to be
exchanged at any such office or agency. Whenever any such Registered Securities
are so surrendered for exchange, the Company shall execute, and the Trustee
shall authenticate and deliver, the Registered Securities which the Holder
making the exchange is entitled to receive. Unless otherwise specified with
respect to any series of Securities as contemplated by Section 301, Bearer
Securities may not be issued in exchange for Registered Securities.
If (but only if) permitted by the applicable Board Resolution and
(subject to Section 303) set forth in the applicable Officers' Certificate, or
in any indenture supplemental hereto, delivered as contemplated by Section 301,
at the option of the Holder, Bearer Securities of any series may be exchanged
for Registered Securities of the same series of any authorized denominations and
of a like aggregate principal amount and tenor, upon surrender of the Bearer
Securities to be exchanged at any such office or agency, with all unmatured
coupons and all matured coupons in default thereto appertaining. If the Holder
of a Bearer Security is unable to produce any such unmatured coupon or coupons
or matured coupon or coupons in default, any such permitted exchange may be
effected if the Bearer Securities are accompanied by payment in funds acceptable
to the Company in an amount equal to the face amount of such missing coupon or
coupons, or the surrender of such missing coupon or coupons may be waived by the
Company and the Trustee if there is furnished to them such security or indemnity
as they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Security shall surrender to any Paying Agent any
such missing coupon in respect of which such a payment shall have been made,
such Holder shall be entitled to receive the amount of such payment; provided,
however, that, except as otherwise provided in Section 1002, interest
represented by coupons shall be payable only upon presentation and surrender of
those coupons at an office or agency located outside the United States.
Notwithstanding the foregoing, in case a Bearer Security of any series is
surrendered at any such office or agency in a permitted exchange for a
Registered Security of the same series and like tenor after the close of
business at such office or agency on (i) any Regular Record Date and before the
opening of business at such office or agency on the relevant Interest Payment
Date, or (ii) 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,
such Bearer Security shall be surrendered without the coupon relating to such
Interest Payment Date or proposed date for payment, as the case may be, and
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 of the Registered Security issued in exchange for such Bearer Security,
but will be payable only to the Holder of such coupon when due in accordance
with the provisions of this Indenture. Whenever any Bearer Securities are so
surrendered for exchange, the Company shall execute, and the Trustee shall
authenticate and deliver, the Securities which the Holder making the exchange is
entitled to receive.
Notwithstanding the foregoing, except as otherwise specified as
contemplated by Section 301, any permanent global Security shall be exchangeable
only as provided in this paragraph. If the depositary for any permanent global
Security is DTC, then, unless the terms of such global Security expressly permit
such global Security to be exchanged in whole or in part for definitive
Securities, a global Security may be transferred, in whole but not in part, only
to a nominee of DTC, or by a nominee of DTC to DTC, or to a successor to DTC for
such global Security selected or approved by the Company or to a nominee of such
successor to DTC. If at any time DTC notifies the Company that it is unwilling
or unable to continue as depositary for the applicable global Security or
Securities or if at any time DTC ceases to be a clearing agency registered under
the Securities Exchange Act of 1934, as amended, if so required by applicable
law or regulation, the Company shall appoint a successor depositary with respect
to such global Security or Securities. If (x) a successor depositary for such
global Security or Securities is not appointed by the Company within 90 days
after the Company receives such notice or becomes aware of such unwillingness,
inability or ineligibility, (y) an Event of Default has occurred and is
continuing and the beneficial owners representing a majority in principal amount
of the applicable series of Securities represented by such global Security or
Securities advise DTC to cease acting as depositary for such global Security or
Securities or (z) the Company, in its sole discretion, determines at any time
that all Outstanding Securities (but not less than all) of any series issued or
issuable in the form of one or more global Securities shall no longer be
represented by such global Security or Securities, then the Company shall
execute, and the
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Trustee shall authenticate and deliver, definitive Securities of like series,
rank, tenor and terms in definitive form in an aggregate principal amount equal
to the principal amount of such global Security or Securities. If any beneficial
owner of an interest in a permanent global Security is otherwise entitled to
exchange such interest for Securities of such series and of like tenor and
principal amount of another authorized form and denomination, as specified as
contemplated by Section 301 and provided that any applicable notice provided in
the permanent global Security shall have been given, then without unnecessary
delay but in any event no later than the earliest date on which such interest
may be so exchanged, the Company shall execute, and the Trustee shall
authenticate and deliver, definitive Securities in aggregate principal amount
equal to the principal amount of such beneficial owner's interest in such
permanent global Security. On or after the earliest date on which such interests
may be so exchanged, such permanent global Security shall be surrendered for
exchange by DTC or such other depositary as shall be specified in the Company
Order with respect thereto to the Trustee, as the Company's agent for such
purpose; provided, however, that no such exchanges may occur during a period
beginning at the opening of business 15 days before any selection of Securities
to be redeemed and ending on the relevant Redemption Date if the Security for
which exchange is requested may be among those selected for redemption; and
provided further that no Bearer Security delivered in exchange for a portion of
a permanent global Security shall be mailed or otherwise delivered to any
location in the United States. If a Registered Security is issued in exchange
for any portion of a permanent global Security after the close of business at
the office or agency where such exchange occurs on (i) any Regular Record Date
and before the opening of business at such office or agency on the relevant
Interest Payment Date, or (ii) 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 of such Registered Security, 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 or such permanent global
Security is payable in accordance with the provisions of this Indenture.
All Securities issued upon any registration of transfer or exchange of
Securities shall be the valid obligations of the Company, evidencing the same
debt, and entitled to the same benefits under this Indenture, as the Securities
surrendered upon such registration of transfer or exchange.
Every Registered Security presented or surrendered for registration of
transfer or for exchange or redemption shall (if so required by the Company or
the Security Registrar) be duly endorsed, or be accompanied by a written
instrument of transfer in form satisfactory to the Company and the Security
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 Securities, but the Company may require payment of a sum sufficient
to cover any tax or other governmental charge that may be imposed in connection
with any registration of transfer or exchange of Securities, other than
exchanges pursuant to Section 304, 906, 1107 or 1305 not involving any transfer.
The Company or the Trustee, as applicable, shall not be required (i) to
issue, register the transfer of or exchange any Security if such Security may be
among those selected for redemption during a period beginning at the opening of
business 15 days before selection of the Securities to be redeemed under Section
1103 and ending at the close of business on (A) if such Securities are issuable
only as Registered Securities, the day of the mailing of the relevant notice of
redemption and (B) if such Securities are issuable as Bearer Securities, the day
of the first publication of the relevant notice of redemption or, if such
Securities are also issuable as Registered Securities and there is no
publication, the mailing of the relevant notice of redemption, or (ii) to
register the transfer of or exchange any Registered Security so selected for
redemption in whole or in part, except, in the case of any Registered Security
to be redeemed in part, the portion thereof not to be redeemed, or (iii) to
exchange any Bearer Security so selected for redemption except that such a
Bearer Security may be exchanged for a Registered Security of that series and of
like tenor; provided that such Registered Security shall be simultaneously
surrendered for redemption, or (iv) to issue, register the transfer of or
exchange any Security which has been surrendered for repayment at the option of
the Holder, except that portion, if any, of such Security which is not to be so
repaid.
Section 306. Mutilated, Destroyed, Lost and Stolen Securities. If any
mutilated Security or a Security with a mutilated coupon appertaining to it is
surrendered to the Trustee or the Company, together with, in proper cases, such
security or indemnity as may be required by the Company or the Trustee to save
each of them or any agent of either of them harmless, the Company shall execute
and the Trustee shall authenticate and deliver in exchange therefor a new
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Security of the same series and principal amount, containing identical terms and
provisions and bearing a number not contemporaneously outstanding, with coupons
corresponding to the coupons, if any, appertaining to the surrendered Security.
If there shall be delivered to the Company and to the Trustee (i)
evidence to their satisfaction of the destruction, loss or theft of any Security
or coupon, and (ii) such security or indemnity as may be required by them to
save each of them and any agent of either of them harmless, then, in the absence
of written notice to the Company or the Trustee that such Security or coupon 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 Security or in exchange for the Security to which a
destroyed, lost or stolen coupon appertains (with all appurtenant coupons not
destroyed, lost or stolen), a new Security of the same series and principal
amount, containing identical terms and provisions and bearing a number not
contemporaneously outstanding, with coupons corresponding to the coupons, if
any, appertaining to such destroyed, lost or stolen Security or to the Security
to which such destroyed, lost or stolen coupon appertains.
Notwithstanding the provisions of the previous two paragraphs, in case
any such mutilated, destroyed, lost or stolen Security or coupon has become or
is about to become due and payable, the Company in its discretion may, instead
of issuing a new Security, with coupons corresponding to the coupons, if any,
appertaining to such destroyed, lost or stolen Security or to the Security to
which such destroyed, lost or stolen coupon appertains, pay such Security or
coupon; provided, however, that payment of principal of (and premium, if any),
any interest on and any Additional Amounts with respect to, Bearer Securities
shall, except as otherwise provided in Section 1002, be payable only at an
office or agency located outside the United States and, unless otherwise
specified as contemplated by Section 301, any interest on Bearer Securities
shall be payable only upon presentation and surrender of the coupons
appertaining thereto.
Upon the issuance of any new 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 Security of any series with its coupons, if any, issued
pursuant to this Section in lieu of any destroyed, lost or stolen Security, or
in exchange for a Security to which a destroyed, lost or stolen coupon
appertains, shall constitute an original additional contractual obligation of
the Company, whether or not the destroyed, lost or stolen Security and its
coupons, if any, or the destroyed, lost or stolen coupon 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 Securities of that
series and their coupons, if any, 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 Securities or coupons.
Section 307. Payment of Interest; Interest Rights Preserved. Except as
otherwise specified with respect to a series of Securities in accordance with
the provisions of Section 301, interest on any Registered Security that is
payable, and is punctually paid or duly provided for, on any Interest Payment
Date shall be paid to the Person in whose name that Security (or one or more
Predecessor Securities) is registered at the close of business on the Regular
Record Date for such interest at the office or agency of the Company maintained
for such purpose pursuant to Section 1002; provided, however, that each
installment of interest on any Registered Security may at the Company's option
be paid by (i) mailing a check for such interest, payable to or upon the written
order of the Person entitled thereto pursuant to Section 308, to the address of
such Person as it appears on the Security Register or (ii) transfer to an
account maintained by the payee located inside the United States.
Unless otherwise provided as contemplated by Section 301 with respect
to the Securities of any series, payment of interest may be made, in the case of
a Bearer Security, by transfer to an account maintained by the payee with a bank
located outside the United States.
Unless otherwise provided as contemplated by Section 301, every
permanent global Security will provide that interest, if any, payable on any
Interest Payment Date will be paid to DTC, Euroclear and/or CEDEL, as the case
may be, with respect to that portion of such permanent global Security held for
its account by Cede & Co. or the Common Depositary, as the case may be, for the
purpose of permitting such party to credit the interest received by it in
respect of such permanent global Security to the accounts of the beneficial
owners thereof.
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In case a Bearer Security of any series is surrendered in exchange for
a Registered Security of such series after the close of business (at an office
or agency in a Place of Payment for such series) on any Regular Record Date and
before the opening of business (at such office or agency) on the next succeeding
Interest Payment Date, such Bearer Security shall be surrendered without the
coupon relating to such Interest Payment Date and interest will not be payable
on such Interest Payment Date in respect of the Registered Security issued in
exchange for such Bearer Security, but will be payable only to the Holder of
such coupon when due in accordance with the provisions of this Indenture.
Except as otherwise specified with respect to a series of Securities in
accordance with the provisions of Section 301, any interest on any Registered
Security of any series that is payable, but is not punctually paid or duly
provided for, on any Interest Payment Date (herein called "Defaulted Interest")
shall forthwith cease to be payable to the registered Holder thereof 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 Registered Securities of
such series (or their respective Predecessor 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 Registered Security of
such series and the date of the proposed payment (which shall not be
less than 20 days after such notice is received by the Trustee), and at
the same time the Company shall deposit with the Trustee an amount of
money in the currency or currencies, currency unit or units or
composite currency or currencies in which the Securities of such series
are payable (except as otherwise specified pursuant to Section 301 for
the Securities of such series) 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 on or 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 provided. Thereupon the Trustee shall fix a
Special Record Date for the payment of such Defaulted Interest which
shall not be 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 Registered Securities of such series at his address as it
appears in the Security Register not less than 10 days prior to such
Special Record Date. The Trustee may, in its discretion, in the name
and at the expense of the Company, cause a similar notice to be
published at least once in an Authorized Newspaper in each Place of
Payment, but such publications shall not be a condition precedent to
the establishment of 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 the Registered Securities of such series
(or their respective Predecessor 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). In case a Bearer Security
of any series is surrendered for transfer or exchange at the office or
agency in a Place of Payment for such series after the close of
business at such office or agency on 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, such Bearer Security
shall be surrendered without the coupon relating to such proposed date
of payment and Defaulted Interest will not be payable on such proposed
date of payment in respect of the Registered Security issued in
exchange for such Bearer Security, but will be payable only to the
Holder of such coupon when due in accordance with the provisions of
this Indenture.
(2) The Company may make payment of any Defaulted Interest on
the Registered Securities of any series in any other lawful manner not
inconsistent with the requirements of any securities exchange on which
such Securities 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, such manner of payment
shall be deemed practicable by the Trustee.
Subject to the foregoing provisions of this Section and Section 305,
each Security delivered under this Indenture upon registration of transfer of or
in exchange for or in lieu of any other Security shall carry the rights to
interest accrued and unpaid, and to accrue, which were carried by such other
Security.
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Section 308. Persons Deemed Owners. Prior to due presentment of a
Registered 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
Registered Security is registered as the owner of such Security for the purpose
of receiving payment of principal of (and premium, if any), and (subject to
Sections 305 and 307) interest on, such Registered Security and for all other
purposes whatsoever, whether or not such Registered 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.
Title to any Bearer Security and any coupons appertaining thereto shall
pass by delivery. The Company, the Trustee and any agent of the Company or the
Trustee may treat the Holder of any Bearer Security and the Holder of any coupon
as the absolute owner of such Security or coupon for the purpose of receiving
payment thereof or on account thereof and for all other purposes whatsoever,
whether or not such Security or coupon 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.
None of the Company, the Trustee, any Paying Agent or the Security
Registrar will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests of a Security in global form or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
Notwithstanding the foregoing, with respect to any global 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 any depositary, as a Holder, with respect to
such global Security or impair, as between such depositary and owners of
beneficial interests in such global Security, the operation of customary
practices governing the exercise of the rights of such depositary (or its
nominee) as Holder of such global Security.
Section 309. Cancellation. All Securities and coupons surrendered for
payment, redemption, repayment at the option of the Holder, registration of
transfer or exchange or for credit against any sinking fund payment shall, if
surrendered to any Person other than the Trustee, be delivered to the Trustee,
and any such Securities and coupons and Securities and coupons surrendered
directly to the Trustee for any such purpose shall be promptly canceled by it.
The Company may at any time deliver to the Trustee for cancellation any
Securities previously authenticated and delivered hereunder which the Company
may have acquired in any manner whatsoever, and may deliver to the Trustee (or
to any other Person for delivery to the Trustee) for cancellation any Securities
previously authenticated hereunder which the Company has not issued and sold,
and all Securities so delivered shall be promptly canceled by the Trustee. If
the Company shall so acquire any of the Securities, however, such acquisition
shall not operate as a redemption or satisfaction of the indebtedness
represented by such Securities unless and until the same are surrendered to the
Trustee for cancellation. No Securities shall be authenticated in lieu of or in
exchange for any Securities canceled as provided in this Section, except as
expressly permitted by this Indenture. Canceled Securities and coupons held by
the Trustee shall be destroyed by the Trustee and the Trustee shall deliver a
certificate of such destruction to the Company, unless by a Company Order the
Company directs their return to it.
Section 310. Computation of Interest. Except as otherwise specified as
contemplated by Section 301 with respect to Securities of any series, interest
on the Securities of each series shall be computed on the basis of a 360-day
year consisting of twelve 30-day months.
ARTICLE 4
SATISFACTION AND DISCHARGE
Section 401. Satisfaction and Discharge of Indenture. This Indenture
shall upon Company Request cease to be of further effect with respect to any
series of Securities specified in such Company Request (except as to any
surviving rights of registration of transfer or exchange of Securities of such
series herein expressly provided for and any right to receive Additional
Amounts, as provided in Section 1007), and the Trustee, upon receipt of a
Company Order, and at the expense of the Company, shall execute proper
instruments acknowledging satisfaction and discharge of this Indenture as to
such series when
(1) either
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(A) all Securities of such series theretofore
authenticated and delivered and all coupons, if any, appertaining
thereto (other than (i) coupons appertaining to Bearer Securities
surrendered for exchange for Registered Securities and maturing after
such exchange, whose surrender is not required or has been waived as
provided in Section 305, (ii) Securities and coupons of such series
which have been destroyed, lost or stolen and which have been replaced
or paid as provided in Section 306, (iii) coupons appertaining to
Securities called for redemption and maturing after the relevant
Redemption Date, whose surrender has been waived as provided in Section
1106, and (iv) Securities and coupons of such series 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
(B) all Securities of such series and, in the case of
(i) or (ii) below, any coupons appertaining thereto, 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) above, has
irrevocably deposited or caused to be deposited with the Trustee as
funds in trust for such purpose an amount in the currency or
currencies, currency unit or units or composite currency or currencies
in which the Securities of such series are payable, sufficient to pay
and discharge the entire indebtedness on such Securities and such
coupons not theretofore delivered to the Trustee for cancellation, for
principal (and premium, if any) and interest, and any Additional
Amounts with respect thereto, to the date of such deposit (in the case
of 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 as to such series have been complied with.
The obligations of the Company to the Trustee and any predecessor Trustee under
Section 606, the obligations of the Company to any Authenticating Agent under
Section 611 and, if money shall have been deposited with and held by the Trustee
pursuant to subclause (B) of clause (1) of this Section, the obligations of the
Trustee under Section 402 and the last paragraph of Section 1003 shall survive
the satisfaction and discharge of this Indenture.
Section 402. Application of Trust Funds. 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 Securities, the coupons and 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 any interest and
Additional Amounts for whose payment such money has been deposited with or
received by the Trustee, but such money need not be segregated from other funds
except to the extent required by law.
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ARTICLE 5
REMEDIES
Section 501. Events of Default. "Event of Default", wherever used
herein with respect to any particular series of Securities, means any one of the
following events (whatever the reason for such Event of Default and whether or
not 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 or any
Additional Amounts payable in respect of any Security of that series or
of any coupon appertaining thereto, when such interest, Additional
Amounts or coupon 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 (or premium, if
any, on) any 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
and as due by the terms of any Security of that series; or
(4) default in the performance of, or breach of, any covenant
of the Company in this Indenture (other than a covenant 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 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 a majority in principal amount of the Outstanding
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
(5) a default under any bond, debenture, note or other
evidence of indebtedness of the Company, or under any mortgage,
indenture or other instrument of the Company (including a default with
respect to Securities of any series other than that series) under which
there may be issued or by which there may be secured any indebtedness
of the Company (or by any Subsidiary, the repayment of which the
Company has guaranteed or for which the Company is directly responsible
or liable as obligor or guarantor), whether such indebtedness now
exists or shall hereafter be created, which default shall constitute a
failure to pay an aggregate principal amount exceeding $20,000,000 of
such indebtedness when due and payable after the expiration of any
applicable grace period with respect thereto and shall have resulted in
such indebtedness in an aggregate principal amount exceeding
$20,000,000 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 a majority in principal amount of the Outstanding Securities of
that series a written notice specifying such default and requiring the
Company to cause such indebtedness to be discharged or cause such
acceleration to be rescinded or annulled and stating that such notice
is a "Notice of Default" hereunder; or
(6) the Company or any Significant Subsidiary pursuant to or
within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief
against it in an involuntary case,
(C) consents to the appointment of a Custodian of it
or for all or substantially all of its property, or
(D) makes a general assignment for the benefit of its
creditors; or
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(7) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(A) is for relief against the Company or any
Significant Subsidiary in an involuntary case,
(B) appoints a Custodian of the Company or any
Significant Subsidiary or for all or substantially all of
either of its property, or
(C) orders the liquidation of the Company or any
Significant Subsidiary,
and the order or decree remains unstayed and in effect for 90 days; or
(8) any other Event of Default provided with respect to
Securities of that series.
As used in this Section 501, the term "Bankruptcy Law" means Title 11, U.S. Code
or any similar Federal or State law for the relief of debtors and the term
"Custodian" means any receiver, trustee, assignee, liquidator or other similar
official under any Bankruptcy Law.
Section 502. Acceleration of Maturity; Rescission and Annulment. If an
Event of Default with respect to Securities of any series at the time
Outstanding occurs and is continuing (other than an Event of Default described
in Section 501(6) or 501(7)), then and in every such case the Trustee or the
Holders of not less than a majority in principal amount of the Outstanding
Securities of that series may declare the principal (or, if any Securities are
Original Issue Discount Securities or Indexed Securities, such portion of the
principal as may be specified in the terms thereof) of all the Securities of
that series to be due and payable immediately, by a notice in writing to the
Company (and to the Trustee if given by the Holders), and upon any such
declaration such principal or specified portion thereof shall become immediately
due and payable. If an Event of Default described in Section 501(6) or 501(7)
with respect to any series of Securities at the time outstanding occurs, the
principal amount of all of the Securities of that series (or, in the case of any
such Original Issue Discount Securities or Indexed Securities, such portion of
the principal as may be specified in the terms thereof) will automatically, and
without any action by the Trustee or any Holder thereof, become immediately due
and payable.
At any time after such a declaration of acceleration with respect to
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 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 in the currency, currency unit or composite currency
in which the Securities of such series are payable (except as otherwise
specified pursuant to Section 301 for the Securities of such series):
(A) all overdue installments of interest on and any
Additional Amounts payable in respect of all Outstanding Securities of
that series and any related coupons,
(B) the principal of (and premium, if any, on) any
Outstanding 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 Securities,
(C) to the extent that payment of such interest is
lawful, interest upon overdue installments of interest and any
Additional Amounts at the rate or rates borne by or provided for in
such 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
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(2) all Events of Default with respect to Securities of that
series, other than the nonpayment of the principal of (or premium, if
any) or interest on Securities of that series which have become due
solely by such declaration of 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.
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 or Additional Amounts, if any, on any Security of any series
and any related coupon when such interest or Additional Amount 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 Security of any series at its Maturity,
then the Company will, upon demand of the Trustee, pay to the Trustee, for the
benefit of the Holders of such Securities of such series and coupons, the whole
amount then due and payable on such Securities and coupons for principal (and
premium, if any) and interest and Additional Amounts thereon, with interest upon
any overdue principal (and premium, if any) and, to the extent that payment of
such interest shall be legally enforceable, upon any overdue installments of
interest or Additional Amounts thereon, if any, at the rate or rates borne by or
provided for in such 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 such Securities of such series 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 such Securities
of such series, wherever situated.
If an Event of Default with respect to 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 Securities of such series
and any related coupons 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.
Section 504. Trustee May File Proofs of Claim. In case of the pendency
of any receivership, insolvency, liquidation, bankruptcy, reorganization,
arrangement, adjustment, composition or other judicial proceeding relative to
the Company or any other obligor upon the Securities or the property of the
Company or of such other obligor or their creditors, the Trustee (irrespective
of whether the principal of the Securities of any series 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 of, or premium, if any, or interest on, the Securities) shall
be entitled and empowered, by intervention in such proceeding or otherwise:
(i) to file and prove a claim for the whole amount, or such
lesser amount as may be provided for in the Securities of such series,
of principal (and premium, if any) and interest and Additional Amount,
if any, owing and unpaid in respect of the 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
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
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and any custodian, receiver, assignee, trustee, liquidator, sequestrator (or
other similar official) in any such judicial proceeding is hereby authorized by
each Holder of Securities of such series and coupons 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 and any predecessor Trustee, their agents and counsel, and any other
amounts due the Trustee or any predecessor Trustee under Section 606.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Holder of a Security
or coupon any plan of reorganization, arrangement, adjustment or composition
affecting the Securities or coupons or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder of a
Security or coupon in any such proceeding.
Section 505. Trustee May Enforce Claims Without Possession of
Securities or Coupons. All rights of action and claims under this Indenture or
any of the Securities or coupons may be prosecuted and enforced by the Trustee
without the possession of any of the Securities or coupons 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 Securities
and coupons 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 and any
Additional Amounts, upon presentation of the Securities or coupons, or both, as
the case may be, 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 to the Trustee and
any predecessor Trustee under Section 606;
SECOND: To the payment of the amounts then due and unpaid upon
the Securities and coupons for principal (and premium, if any) and
interest and any Additional Amounts payable, 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 aggregate amounts
due and payable on such Securities and coupons for principal (and
premium, if any), interest and Additional Amounts, respectively; and
THIRD: To the payment of the remainder, if any, to the
Company.
Section 507. Limitation on Suits. No Holder of any Security of any
series or any related coupon 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 Securities
of that series;
(2) the Holders of not less than a majority in principal
amount of the Outstanding Securities of that series shall 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 Securities of that
series;
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it being understood and intended that no one or more of such Holders 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 of
such Holders, or to obtain or to seek to obtain priority or preference over any
other of such Holders or to enforce any right under this Indenture, except in
the manner herein provided and for the equal and ratable benefit of all such
Holders.
Section 508. Unconditional Right of Holders to Receive Principal,
Premium, if any, Interest and Additional Amounts. Notwithstanding any other
provision in this Indenture, the Holder of any Security or coupon shall have the
right which is absolute and unconditional to receive payment of the principal of
(and premium, if any) and (subject to Sections 305 and 307) interest on, and any
Additional Amounts in respect of, such Security or payment of such coupon on the
respective due dates expressed in such Security or coupon (or, in the case of
redemption, on the Redemption Date) and to institute suit for the enforcement of
any such payment, and such rights shall not be impaired without the consent of
such Holder.
Section 509. Restoration of Rights and Remedies. If the Trustee or any
Holder of a Security or coupon has instituted any proceeding to enforce any
right or remedy under this 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 and in every such case the Company, the Trustee and the
Holders of Securities and coupons shall, subject to any determination in such
proceeding, 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. Except as otherwise
provided with respect to the replacement or payment of mutilated, destroyed,
lost or stolen Securities or coupons in the last paragraph of Section 306, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders of Securities or coupons 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. No delay or omission of the
Trustee or of any Holder of any Security or coupon 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 of Securities or coupons, as the
case may be.
Section 512. Control by Holders of Securities. The Holders of not less
than a majority in principal amount of the Outstanding 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 the Securities of such series;
provided that
(1) such direction shall not be in conflict with any rule of
law or with this Indenture,
(2) the Trustee may take any other action deemed proper by the
Trustee which is not inconsistent with such direction, and
(3) the Trustee need not take any action which might expose it
to personal liability or be unduly prejudicial to the Holders of
Securities of such series not joining therein.
Section 513. Waiver of Past Defaults. The Holders of not less than a
majority in principal amount of the Outstanding Securities of any series may on
behalf of the Holders of all the Securities of such series and any related
coupons waive any past default hereunder with respect to such series and its
consequences, except a default
(1) in the payment of the principal of (or premium, if any) or
interest on or Additional Amounts payable in respect of any Security of
such series or any related coupons, or
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(2) in respect of a covenant or provision hereof which under
Article 9 cannot be modified or amended without the consent of the
Holder of each Outstanding Security of such 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 Event of Default or impair any right consequent thereon.
Section 514. Waiver of Usury, 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 usury, stay or extension law wherever enacted, now
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 execution of any
power herein granted to the Trustee, but will suffer and permit the execution of
every such power as though no such law had been enacted.
Section 515. Undertaking for Costs. All parties to this Indenture
agree, and each Holder of any 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 or omitted by it as Trustee, the filing
by any party litigant in such suit 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
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, to any suit instituted by any Holder, or group
of Holders, holding in the aggregate more than a majority in principal amount of
the Outstanding Securities, or to any suit instituted by any Holder for the
enforcement of the payment of the principal of (or premium, if any) or interest
on any Security on or after the respective Stated Maturities expressed in such
Security (or, in the case of redemption, on or after the Redemption Date).
ARTICLE 6
THE TRUSTEE
Section 601. Notice of Defaults. Within 90 days after the occurrence of
any default hereunder with respect to the Securities of any series, the Trustee
shall transmit in the manner and to the extent provided in TIA Section 313(c),
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 on
or any Additional Amounts or sinking fund installment with respect to the
Securities of such series, the Trustee shall be protected in withholding such
notice if and so long as Responsible Officers of the Trustee in good faith
determine that the withholding of such notice is in the interest of the Holders
of the Securities and coupons of such series; and provided further that in the
case of any default or breach of the character specified in Section 501(4) with
respect to the Securities and coupons of such 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 the Securities of such series.
Section 602. Certain Rights of Trustee. Subject to the provisions of
TIA Section 315(a) through 315(d):
(1) 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, note, coupon or other paper or document
believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(2) any request or direction of the Company mentioned herein
shall be sufficiently evidenced by a Company Request or Company Order
(other than delivery of any Security, together with any coupons
appertaining thereto, to the Trustee for authentication and delivery
pursuant to Section 303 which shall be sufficiently evidenced as
provided therein) and any resolution of the Board of Directors may be
sufficiently evidenced by a Board Resolution;
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(3) 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 to take 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;
(4) the Trustee may consult with counsel and the 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;
(5) 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 of Securities of any series or any
related coupons 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;
(6) 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, debenture, note, coupon 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;
(7) 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
(8) the Trustee shall not be liable for any action taken,
suffered or omitted by it in good faith and reasonably believed by it
to be authorized or within the discretion or rights or powers conferred
upon it by this Indenture.
The Trustee shall not be required 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.
Section 603. Not Responsible for Recitals or Issuance of Securities.
The recitals contained herein and in the Securities, except the Trustee's
certificate of authentication, and in any coupons shall be taken as the
statements of the Company, and neither the Trustee nor any Authenticating Agent
assumes any responsibility for their correctness. The Trustee makes no
representations as to the validity or sufficiency of this Indenture or of the
Securities or coupons, except that the Trustee represents that it is duly
authorized to execute and deliver this Indenture, authenticate the Securities
and perform its obligations hereunder. Neither the Trustee nor the
Authenticating Agent shall be accountable for the use or application by the
Company of Securities or the proceeds thereof.
Section 604. May Hold Securities. The Trustee, any Paying Agent,
Security Registrar, Authenticating Agent or any other agent of the Company, in
its individual or any other capacity, may become the owner or pledgee of
Securities and coupons and, subject to TIA Sections 310(b) and 311, may
otherwise deal with the Company with the same rights it would have if it were
not Trustee, Paying Agent, Security Registrar, Authenticating Agent or such
other agent.
Section 605. 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. The Trustee shall be under no liability for interest on any money
received by it hereunder except as otherwise agreed with the Company.
Section 606. Compensation and Reimbursement. The Company agrees:
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(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) except as otherwise expressly provided herein, to
reimburse each of the Trustee and any predecessor 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 any such expense,
disbursement or advance as may be attributable to its negligence or bad
faith; and
(3) to indemnify each of the Trustee and any predecessor
Trustee for, and to hold it harmless against, any loss, liability or
expense incurred without negligence or bad faith on its own part,
arising out of or in connection with the acceptance or administration
of the trust or trusts hereunder, including the costs and expenses of
defending itself against any claim or liability in connection with the
exercise or performance of any of its powers or duties hereunder.
When the Trustee incurs expenses or renders services in connection with
an Event of Default specified in Section 501(6) or Section 501(7), the expenses
(including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
As security for the performance of the obligations of the Company under
this Section, the Trustee shall have a lien prior to the 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 (or premium, if any) or interest on
particular Securities or coupons.
The provisions of this Section shall survive the termination of this
Indenture.
Section 607. Corporate Trustee Required; Eligibility; Conflicting
Interests. There shall at all times be a Trustee hereunder which shall be
eligible to act as Trustee under TIA Section 310(a)(1) and shall have a combined
capital and surplus of at least $50,000,000. If such corporation publishes
reports of condition at least annually, pursuant to law or the requirements of
Federal, state, Territorial or District of Columbia 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 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.
Section 608. 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 in accordance with the
applicable requirements of Section 609.
(b) The Trustee may resign at any time with respect to the 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.
(c) The Trustee may be removed at any time with respect to the
Securities of any series by Act of the Holders of a majority in principal amount
of the Outstanding Securities of such series delivered to the Trustee and to the
Company.
(d) If at any time:
(1) the Trustee shall fail to comply with the provisions of
TIA Section 310(b) after written request therefor by the Company or by
any Holder of a Security who has been a bona fide Holder of a Security
for at least six months, or
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(2) the Trustee shall cease to be eligible under Section
607(a) and shall fail to resign after written request therefor by the
Company or by any Holder of a Security who has been a bona fide Holder
of a Security for at least six months, or
(3) the Trustee shall become incapable of acting or shall be
adjudged a bankrupt or insolvent or a receiver of the Trustee or of its
property shall be appointed or any public officer shall take charge or
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 or pursuant to a Board Resolution may
remove the Trustee and appoint a successor Trustee with respect to all
Securities, or (ii) subject to TIA Section 315(e), any Holder of a Security who
has been a bona fide Holder of a Security 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 all Securities and
the appointment of a successor Trustee or Trustees.
(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 reason with
respect to the Securities of one or more series, the Company, by or pursuant to
a Board Resolution, shall promptly appoint a successor Trustee or Trustees with
respect to the Securities of that or those series (it being understood that any
such successor Trustee may be appointed with respect to the Securities of one or
more or all of such series and that at any time there shall be only one Trustee
with respect to the Securities of any particular series). If, within one year
after such resignation, removal or incapability, or the occurrence of such
vacancy, a successor Trustee with respect to the Securities of any series shall
be appointed by Act of the Holders of a majority in principal amount of the
Outstanding Securities of such 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 Securities
of such series and to that extent supersede the successor Trustee appointed by
the Company. If no successor Trustee with respect to the Securities of any
series shall have been so appointed by the Company or the Holders of Securities
and accepted appointment in the manner hereinafter provided any Holder of a
Security who has been a bona fide Holder of a Security of such 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 Securities of such series.
(f) The Company shall give notice of each resignation and each removal
of the Trustee with respect to the Securities of any series and each appointment
of a successor Trustee with respect to the Securities of any series in the
manner provided for notices to the Holders of Securities in Section 106. Each
notice shall include the name of the successor Trustee with respect to the
Securities of such series and the address of its Corporate Trust Office.
Section 609. Acceptance of Appointment by Successor.
(a) In case of the appointment hereunder of a successor Trustee with
respect to all Securities, every such successor Trustee 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, upon 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
claim, if any, provided for in Section 606.
(b) In case of the appointment hereunder of a successor Trustee with
respect to the Securities of one or more (but not all) series, the Company, the
retiring Trustee and each successor Trustee with respect to the Securities of
one or more series shall execute and deliver an indenture supplemental hereto,
pursuant to Article 9 hereof, 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 to
the 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 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 Securities of that or those series
as to which the retiring Trustee is not retiring shall continue to be vested in
the
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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
co-trustees of the same trust and 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 upon the execution and delivery of
such supplemental indenture the resignation or removal of the retiring Trustee
shall become effective to the extent provided therein 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 Securities of that or those series 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 all property and money held by such retiring Trustee hereunder
with respect to the Securities of that or those series 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.
(d) No successor Trustee shall accept its appointment unless at the
time of such acceptance such successor Trustee shall be qualified and eligible
under this Article.
Section 610. 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 Securities or coupons 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 Securities or coupons so
authenticated with the same effect as if such successor Trustee had itself
authenticated such Securities or coupons. In case any Securities or coupons
shall not have been authenticated by such predecessor Trustee, any such
successor Trustee may authenticate and deliver such Securities or coupons, in
either its own name or that of its predecessor Trustee, with the full force and
effect which this Indenture provides for the certificate of authentication of
the Trustee.
Section 611. Appointment of Authentication Agent. At any time when any
of the Securities remain Outstanding, the Trustee may appoint an Authenticating
Agent or Agents with respect to one or more series of Securities which shall be
authorized to act on behalf of the Trustee to authenticate Securities of such
series issued upon exchange, registration of transfer or partial redemption or
repayment thereof, and 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. Any such appointment shall be
evidenced by an instrument in writing signed by a Responsible Officer of the
Trustee, a copy of which instrument shall be promptly furnished to the Company.
Wherever reference is made in this Indenture to the authentication and delivery
of Securities by the Trustee or the Trustee's certificate of authentication,
such reference shall be deemed to include authentication and delivery 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 acceptable to the Company and, except as may
otherwise be provided pursuant to Section 301, shall at all times be a bank or
trust company or corporation organized and doing business and in good standing
under the laws of the United States of America or of any State or the District
of Columbia, authorized under such laws to act as Authenticating Agent, having a
combined capital and surplus of not less than $50,000,000 and subject to
supervision or examination by federal or state authorities. If such
Authenticating Agent publishes reports of condition at least annually, pursuant
to law or the requirements of the aforesaid supervising or examining authority,
then for the purposes of this Section, the combined capital and surplus of such
Authenticating Agent shall be deemed to be its combined capital and surplus as
set forth in its most recent report of condition so published. In case 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 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 such Authenticating Agent
shall be a party, or any corporation succeeding to the corporate agency or
corporate trust business of an
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Authenticating Agent, shall continue to be an Authenticating Agent, provided
such corporation shall be otherwise eligible under this Section, without the
execution or filing of any paper or further act on the part of the Trustee or
the Authenticating Agent.
An Authenticating Agent for any series of Securities may at any time
resign by giving written notice of resignation to the Trustee for such series
and to the Company. The Trustee for any series of Securities may at any time
terminate the agency of an 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 such
Authenticating Agent shall cease to be eligible in accordance with the
provisions of this Section, the Trustee for such series may appoint a successor
Authenticating Agent which shall be acceptable to the Company and shall give
notice of such appointment to all Holders of Securities of the series with
respect to which such Authenticating Agent will serve in the manner set forth 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 Company agrees to pay to each Authenticating Agent from time to
time reasonable compensation including reimbursement of its reasonable expenses
for its services under this Section.
If an appointment with respect to one or more series is made pursuant
to this Section, the Securities of such series may have endorsed thereon, in
addition to or in lieu of the Trustee's certificate of authentication, an
alternate certificate of authentication substantially in the following form:
This is one of the Securities of the series
designated therein referred to in the within-mentioned Indenture.
-----------------------------------
as Trustee
By:_________________________________
as Authenticating Agent
By:__________________________________
Authorized Officer
ARTICLE 7
HOLDERS' LISTS AND REPORTS BY TRUSTEE AND COMPANY
Section 701. Disclosure of Names and Addresses of Holders. Every Holder
of Securities or coupons, by receiving and holding the same, agrees with the
Company and the Trustee that neither the Company nor the Trustee nor any
Authenticating Agent nor any Paying Agent nor any Security Registrar shall be
held accountable by reason of the disclosure of any information as to the names
and addresses of the Holders of Securities in accordance with TIA Section 312,
regardless of the source from which such information was derived, and that the
Trustee shall not be held accountable by reason of mailing any material pursuant
to a request made under TIA Section 312(b).
Section 702. Reports by Trustee. Within 60 days after May 15 of each
year commencing with the first May 15 after the first issuance of Securities
pursuant to this Indenture, the Trustee shall transmit by mail to all Holders of
Securities as provided in TIA Section 313(c) a brief report dated as of such May
15 if required by TIA Section 313(a).
Section 703. Reports by Company. The Company will:
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(1) file with the Trustee, within 15 days after the Company is
required to file the same with the Commission, 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 Commission may from
time to time by rules and regulations prescribe) which the Company may
be required to file with the Commission pursuant to Section 13 or
Section 15(d) of the Securities Exchange Act of 1934; or, if the
Company is not required to file information, documents or reports
pursuant to either of such Sections, then it will file with the Trustee
and the Commission, in accordance with rules and regulations prescribed
from time to time by the Commission, such of the supplementary and
periodic information, documents and reports which may be required
pursuant to Section 13 of the Securities Exchange Act of 1934 in
respect of a security listed and registered on a national securities
exchange as may be prescribed from time to time in such rules and
regulations;
(2) file with the Trustee and the Commission, in accordance
with rules and regulations prescribed from time to time by the
Commission, such additional information, documents and reports with
respect to compliance by the Company with the conditions and covenants
of this Indenture as may be required from time to time by such rules
and regulations; and
(3) transmit by mail to the Holders of Securities, within 30
days after the filing thereof with the Trustee, in the manner and to
the extent provided in TIA Section 313(c), such summaries of any
information, documents and reports required to be filed by the Company
pursuant to paragraphs (1) and (2) of this section as may be required
by rules and regulations prescribed from time to time by the
Commission.
Section 704. Company to Furnish to Trustee Names and Addresses of
Holders. The Company will furnish or cause to be furnished to the Trustee:
(a) semi-annually, not later than 25 days after the Regular Record Date
for interest for each series of Securities, a list, in such form as the Trustee
may reasonably require, of the names and addresses of the Holders of Registered
Securities of such series as of such Regular Record Date, or if there is no
Regular Record Date for interest for such series of Securities, semiannually,
upon such dates as are set forth in the Board Resolution or indenture
supplemental hereto authorizing such series, 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 Security Registrar, no
such list shall be required to be furnished.
ARTICLE 8
CONSOLIDATION, MERGER, SALE, LEASE OR CONVEYANCE
Section 801. Consolidations and Mergers of Company and Sales, Leases
and Conveyances Permitted Subject to Certain Conditions. The Company may
consolidate with, or sell, lease or convey all or substantially all of its
assets to, or merge with or into any other corporation; provided that in any
such case, (i) either the Company shall be the continuing corporation, or the
successor corporation shall be a corporation organized and existing under the
laws of the United States or a State thereof and such successor corporation
shall expressly assume the due and punctual payment of the principal of (and
premium, if any) and any interest (including all Additional Amounts, if any,
payable pursuant to Section 1007) on all of the Securities, according to their
tenor, and the due and punctual performance and observance of all of the
covenants and conditions of this Indenture to be performed by the Company by
supplemental indenture, complying with Article 9 hereof, satisfactory to the
Trustee, executed and delivered to the Trustee by such corporation and (ii)
immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of the Company or any Subsidiary as a
result thereof as having been incurred by the Company or such Subsidiary at the
time of such transaction, no Event of Default, and no event which, after notice
or the lapse of time, or both, would become an Event of Default, shall have
occurred and be continuing.
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Section 802. Rights and Duties of Successor Corporation. In case of any
such consolidation, merger, sale, lease or conveyance and upon any such
assumption by the successor corporation, such successor corporation shall
succeed to and be substituted for the Company, with the same effect as if it had
been named herein as the party of the first part, and the predecessor
corporation, except in the event of a lease, shall be relieved of any further
obligation under this Indenture and the 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 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
Securities which previously shall have been signed and delivered by the officers
of the Company to the Trustee for authentication, and any Securities which such
successor corporation thereafter shall cause to be signed and delivered to the
Trustee for that purpose. All the Securities so issued shall in all respects
have the same legal rank and benefit under this Indenture as the Securities
theretofore or thereafter issued in accordance with the terms of this Indenture
as though all of such Securities had been issued at the date of the execution
hereof.
In case of any such consolidation, merger, sale, lease or conveyance,
such changes in phraseology and form (but not in substance) may be made in the
Securities thereafter to be issued as may be appropriate.
Section 803. Officers' Certificate and Opinion of Counsel. Any
consolidation, merger, sale, lease or conveyance permitted under Section 801 is
also subject to the condition that the Trustee receive an Officers' Certificate
and an Opinion of Counsel to the effect that any such consolidation, merger,
sale, lease or conveyance, and the assumption of the Company's obligations under
this Indenture by any successor corporation, complies with the provisions of
this Article and that all conditions precedent herein provided for relating to
such transaction have been complied with.
ARTICLE 9
SUPPLEMENTAL INDENTURES
Section 901. Supplemental Indentures Without Consent of Holders.
Without the consent of any Holders of Securities or coupons, the Company, when
authorized by or pursuant to 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:
(1) to evidence the succession of another Person to the
Company and the assumption by any such successor of the covenants of
the Company herein and in the Securities contained; or
(2) to add to the covenants of the Company for the benefit of
the Holders of all or any series of Securities (and if such covenants
are to be for the benefit of less than all series of Securities,
stating that such covenants are expressly being included solely for the
benefit of such series) or to surrender any right or power herein
conferred upon the Company; or
(3) to add any additional Events of Default for the benefit of
the Holders of all or any series of Securities (and if such Events of
Default are to be for the benefit of less than all series of
Securities, stating that such Events of Default are expressly being
included solely for the benefit of such series); provided, however,
that in respect of any such additional Events of Default such
supplemental indenture may provide for a particular period of grace
after default (which period may be shorter or longer than that allowed
in the case of other defaults) or may provide for an immediate
enforcement upon such default or may limit the remedies available to
the Trustee upon such default or may limit the right of the Holders of
a majority in aggregate principal amount of that or those series of
Securities to which such additional Events of Default apply to waive
such default; or
(4) to add to or change any of the provisions of this
Indenture to provide that Bearer Securities may be registrable as to
principal, to change or eliminate any restrictions on the payment of
principal of or any premium or interest on Bearer Securities, to permit
Bearer Securities to be issued in exchange for Registered Securities,
to permit Bearer Securities to be issued in exchange for Bearer
Securities of other authorized
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denominations or to permit or facilitate the issuance of Securities in
uncertificated form; provided, that any such action shall not adversely
affect the interests of the Holders of Securities of any series or any
related coupons in any material respect; or
(5) to change or eliminate any of the provisions of this
Indenture; provided that any such change or elimination shall become
effective only when there is no Security Outstanding of any series
created prior to the execution of such supplemental indenture which is
entitled to the benefit of such provision; or
(6) to secure the Securities; or
(7) to establish the form or terms of Securities of any series
and any related coupons as permitted by Sections 201 and 301, including
the provisions and procedures relating to Securities convertible into
Common Shares or Preferred Shares of the Company, as the case may be;
or
(8) to evidence and provide for the acceptance of appointment
hereunder by a successor Trustee with respect to the 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; or
(9) to cure any ambiguity, to correct or supplement any
provision herein 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 which shall not be
inconsistent with the provisions of this Indenture; provided such
provisions shall not adversely affect the interests of the Holders of
Securities of any series or any related coupons in any material
respect; or
(10) to supplement any of the provisions of this Indenture to
such extent as shall be necessary to permit or facilitate the
defeasance and discharge of any series of Securities pursuant to
Sections 401, 1402 and 1403; provided that any such action shall not
adversely affect the interests of the Holders of Securities of such
series and any related coupons or any other series of Securities in any
material respect.
Section 902. Supplemental Indentures with Consent of Holders. With the
consent of the Holders of not less than a majority in principal amount of all
Outstanding Securities affected by such supplemental indenture, by Act of said
Holders delivered to the Company and the Trustee, the Company, when authorized
by or pursuant to a Board Resolution, and the Trustee may enter into an
indenture or indentures supplemental hereto for the purpose of adding any
provisions 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
Securities and any related coupons under this Indenture; provided, however, that
no such supplemental indenture shall, without the consent of the Holder of each
Outstanding Security affected thereby:
(1) change the Stated Maturity of the principal of (or
premium, if any, on) or any installment of principal of or interest on,
any Security; or reduce the principal amount thereof or the rate or
amount of interest thereon or any Additional Amounts payable in respect
thereof, or any premium payable upon the redemption thereof, or change
any obligation of the Company to pay Additional Amounts pursuant to
Section 1007 (except as contemplated by Section 801(i) and permitted by
Section 901(1)), or reduce the amount of the principal of an Original
Issue Discount Security that would be due and payable upon a
declaration of acceleration of the Maturity thereof pursuant to Section
502 or the amount thereof provable in bankruptcy pursuant to Section
504, or adversely affect any right of repayment at the option of the
Holder of any Security, or change any Place of Payment where, or the
currency or currencies, currency unit or units or composite currency or
currencies in which, any Security or any premium or the interest
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 or repayment at the option of the
Holder, on or after the Redemption Date or the Repayment Date, as the
case may be), or
(2) reduce the percentage in principal amount of the
Outstanding 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 with respect to such series (or
compliance with certain provisions of this Indenture
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or certain defaults hereunder and their consequences) provided for in
this Indenture, or reduce the requirements of Section 1504 for quorum
or voting, or
(3) modify any of the provisions of this Section, Section 513
or Section 1008, except to increase the required percentage to effect
such action or to provide that certain other provisions of this
Indenture cannot be modified or waived without the consent of the
Holder of each Outstanding Security affected thereby.
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.
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 Securities, or which modifies
the rights of the Holders of Securities of such series with respect to such
covenant or other provision, shall be deemed not to affect the rights under this
Indenture of the Holders of Securities of any other series.
Section 903. Execution of Supplemental Indentures. In executing, or
accepting the additional trusts created by, any supplemental indenture permitted
by this Article or the modification thereby of the trusts created by this
Indenture, the Trustee shall be entitled to receive, and 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 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 Securities theretofore or
thereafter authenticated and delivered hereunder and of any coupon appertaining
thereto shall be bound thereby.
Section 905. Conformity with Trust Indenture Act. Every supplemental
indenture executed pursuant to this Article shall conform to the requirements of
the Trust Indenture Act as then in effect.
Section 906. Reference in Securities to Supplemental Indentures.
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 Securities of any series so modified as to conform, in the opinion of the
Trustee and the Company, to any such supplemental indenture may be prepared and
executed by the Company and authenticated and delivered by the Trustee in
exchange for Outstanding Securities of such series.
ARTICLE 10
COVENANTS
Section 1001. Payment of Principal, Premium, if any, Interest and
Additional Amounts. The Company covenants and agrees for the benefit of the
Holders of each series of Securities that it will duly and punctually pay the
principal of (and premium, if any) and interest on and any Additional Amounts
payable in respect of the Securities of that series in accordance with the terms
of such series of Securities, any coupons appertaining thereto and this
Indenture. Unless otherwise specified as contemplated by Section 301 with
respect to any series of Securities, any interest due on and any Additional
Amounts payable in respect of Bearer Securities on or before Maturity, other
than Additional Amounts, if any, payable as provided in Section 1007 in respect
of principal of (or premium, if any, on) such a Security, shall be payable only
upon presentation and surrender of the several coupons for such interest
installments as are evidenced thereby as they severally mature. Unless otherwise
specified with respect to Securities of any series pursuant to Section 301, at
the option of the Company, all payments of principal may be paid by check to the
registered Holder of the Registered Security or other person entitled thereto
against surrender of such Security.
Section 1002. Maintenance of Office or Agency. If Securities of a
series are issuable only as Registered Securities, the Company shall maintain in
each Place of Payment for any series of Securities an office or agency where
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Securities of that series may be presented or surrendered for payment or
conversion, where Securities of that series may be surrendered for registration
of transfer or exchange, and where notices and demands to or upon the Company in
respect of the Securities of that series and this Indenture may be served. If
Securities of a series are issuable as Bearer Securities, the Company will
maintain: (A) in the Borough of Manhattan, The City of New York, an office or
agency where any Registered Securities of that series may be presented or
surrendered for payment or conversion, where any Registered Securities of that
series may be surrendered for registration of transfer, where Securities of that
series may be surrendered for exchange, where notices and demands to or upon the
Company in respect of the Securities of that series and this Indenture may be
served and where Bearer Securities of that series and related coupons may be
presented or surrendered for payment or conversion in the circumstances
described in the following paragraph (and not otherwise); (B) subject to any
laws or regulations applicable thereto, in a Place of Payment for that series
which is located outside the United States, an office or agency where Securities
of that series and related coupons may be presented and surrendered for payment
(including payment of any Additional Amounts payable on Securities of that
series pursuant to Section 1007) or conversion; provided, however, that if the
Securities of that series are listed on the Luxembourg Stock Exchange or any
other stock exchange located outside the United States and such stock exchange
shall so require, the Company will maintain a Paying Agent for the Securities of
that series in Luxembourg or any other required city located outside the United
States, as the case may be, so long as the Securities of that series are listed
on such exchange; and (C) subject to any laws or regulations applicable thereto,
in a Place of Payment for that series located outside the United States an
office or agency where any Registered Securities of that series may be
surrendered for registration of transfer, where Securities of that series may be
surrendered for exchange and where notices and demands to or upon the Company in
respect of the Securities of that series and this Indenture may be served. The
Company will give prompt written notice to the Trustee of the location, and any
change in the location, of each such office or agency. If at any time the
Company shall fail to maintain any such required 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, except that Bearer Securities of that series and the related coupons
may be presented and surrendered for payment (including payment of any
Additional Amounts payable on Bearer Securities of that series pursuant to
Section 1007) or conversion at the offices specified in the Security in London,
England, and the Company hereby appoints the same as its agent to receive such
respective presentations, surrenders, notices and demands, and the Company
hereby appoints the Trustee its agent to receive all such presentations,
surrenders, notices and demands.
Unless otherwise specified with respect to any Securities pursuant to
Section 301, no payment of principal, premium or interest on or Additional
Amounts in respect of Bearer Securities shall be made at any office or agency of
the Company in the United States or by check mailed to any address in the United
States or by transfer to an account maintained with a bank located in the United
States; provided, however, that, if the Securities of a series are payable in
Dollars, payment of principal of and any premium and interest on any Bearer
Security (including any Additional Amounts payable on Securities of such series
pursuant to Section 1007) shall be made at the office of the Company's Paying
Agent in the City of Boston, if (but only if) payment in Dollars of the full
amount of such principal, premium, interest or Additional Amounts, as the case
may be, at all offices or agencies outside the United States maintained for such
purpose by the Company in accordance with this Indenture, is illegal or
effectively precluded by exchange controls or other similar restrictions.
The Company may from time to time designate one or more other offices
or agencies where the Securities of one or more series may be presented or
surrendered for any or all of such purposes, and may from time to time rescind
such designation; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an office
or agency in accordance with the requirements set forth above for Securities of
any series for such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the location
of any such other office or agency. Unless otherwise specified with respect to
any Securities pursuant to Section 301 with respect to a series of Securities,
the Company hereby designates as a Place of Payment for each series of
Securities the office or agency of the Company in the City of Boston, and
initially appoints the Trustee at its Corporate Trust Office as Paying Agent in
such city and as its agent to receive all such presentations, surrenders,
notices and demands.
Unless otherwise specified with respect to any Securities pursuant to
Section 302, if and so long as the Securities of any series (i) are denominated
in a Foreign Currency or (ii) may be payable in a Foreign Currency or so long as
it is required under any other provision of this Indenture, then the Company
will maintain with respect to each such series of Securities, or as so required,
at least one exchange rate agent.
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Section 1003. Money for Securities 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 any Securities and any related coupons, it will, by no later than 11:00 am
(Boston time) on each due date of the principal of (and premium, if any), or
interest on or Additional Amounts in respect of, any of the Securities of that
series, segregate and hold in trust for the benefit of the Persons entitled
thereto a sum in the currency or currencies, currency unit or units or composite
currency or currencies in which the Securities of such series are payable
(except as otherwise specified pursuant to Section 301 for the Securities of
such series) sufficient to pay the principal (and premium, if any) or interest
or Additional Amounts 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 Securities and any related coupons, it will, on or before each due
date of the principal of (and premium, if any), or interest on or Additional
Amounts in respect of, any Securities of that series, deposit with a Paying
Agent a sum (in the currency or currencies, currency unit or units or composite
currency or currencies described in the preceding paragraph) sufficient to pay
the principal (and premium, if any) or interest or Additional Amounts, so
becoming due, such sum to be held in trust for the benefit of the Persons
entitled to such principal, premium or interest or Additional Amounts 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 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 principal of
(and premium, if any) or interest on Securities 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 Securities) in the making of any such
payment of principal (and premium, if any) or interest; 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.
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 sums.
Except as otherwise provided in the Securities of any series, 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 on,
or any Additional Amounts in respect of, any Security of any series and
remaining unclaimed for two years after such principal (and premium, if any),
interest or Additional Amounts has become due and payable shall be paid to the
Company upon Company Request or (if then held by the Company) shall be
discharged from such trust; and the Holder of such Security shall thereafter, as
an unsecured general creditor, look only to the Company for payment of such
principal of (and premium, if any) or interest on, or any Additional Amounts in
respect of, such Security, without interest thereon, 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 an
Authorized Newspaper, 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. Existence. Subject to Article 8, the Company will do or
cause to be done all things necessary to preserve and keep in full force and
effect its existence, rights (declaration and statutory) and franchises;
provided, however, that the Company shall not be required to preserve any right
or franchise if the Board shall determine that the preservation thereof is no
longer desirable in the conduct of the business of the Company.
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Section 1005. Provision of Financial Information. Whether or not the
Company is subject to Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, the Company will, to the extent permitted under the Securities
Exchange Act of 1934, as amended, file with the Commission the annual reports,
quarterly reports and other documents which the Company would have been required
to file with the Commission pursuant to such Section 13 or 15(d) (the "Financial
Statements") if the Company were so subject, such documents to be filed with the
Commission on or prior to the respective dates (the "Required Filing Dates") by
which the Company would have been required so to file such documents if the
Company were so subject.
The Company will also in any event (x) within 15 days of each Required
Filing Date (i) transmit by mail to all Holders, as their names and addresses
appear in the Security Register, without cost to such Holders copies of the
annual reports and quarterly reports which the Company would have been required
to file with the Commission pursuant to Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, if the Company were subject to such Sections,
and (ii) file with the Trustee copies of the annual reports, quarterly reports
and other documents which the Company would have been required to file with the
Commission pursuant to Section 13 or 15(d) of the Securities Exchange Act of
1934, as amended, if the Company were subject to such Sections and (y) if filing
such documents by the Company with the Commission is not permitted under the
Securities Exchange Act of 1934, as amended, promptly upon written request and
payment of the reasonable cost of duplication and delivery, supply copies of
such documents to any prospective Holder.
Section 1006. Statement as to Compliance. The Company will deliver to
the Trustee, within 120 days after the end of each fiscal year, a brief
certificate from the principal executive officer, principal financial officer or
principal accounting officer as to his or her knowledge of the Company's
compliance with all conditions and covenants under this Indenture and, in the
event of any noncompliance, specifying such noncompliance and the nature and
status thereof. For purposes of this Section 1006, such compliance shall be
determined without regard to any period of grace or requirement of notice under
this Indenture.
Section 1007. Additional Amounts. If any Securities of a series provide
for the payment of Additional Amounts, the Company will pay to the Holder of any
Security of such series or any coupon appertaining thereto Additional Amounts as
may be specified as contemplated by Section 301. Whenever in this Indenture
there is mentioned, in any context except in the case of Section 502(1), the
payment of the principal of or any premium or interest on, or in respect of, any
Security of any series or payment of any related coupon or the net proceeds
received on the sale or exchange of any Security of any series, such mention
shall be deemed to include mention of the payment of Additional Amounts provided
by the terms of such series established pursuant to Section 301 to the extent
that, in such context, Additional Amounts are, were or would be payable in
respect thereof pursuant to such terms and express mention of the payment of
Additional Amounts (if applicable) in any provisions hereof shall not be
construed as excluding Additional Amounts in those provisions hereof where such
express mention is not made.
Except as otherwise specified as contemplated by Section 301, if the
Securities of a series provide for the payment of Additional Amounts, at least
20 days prior to the first Interest Payment Date with respect to that series of
Securities (or if the Securities of that series will not bear interest prior to
Maturity, the first day on which a payment of principal and any premium is
made), and at least 10 days prior to each date of payment of principal and any
premium or interest if there has been any change with respect to the matters set
forth in the below-mentioned Officers' Certificate, the Company will furnish the
Trustee and the Company's principal Paying Agent or Paying Agents, if other than
the Trustee, with an Officers' Certificate instructing the Trustee and such
Paying Agent or Paying Agents whether such payment of principal of and any
premium or interest on the Securities of that series shall be made to Holders of
Securities of that series or any related coupons who are not United States
persons without withholding for or on account of any tax, assessment or other
governmental charge described in the Securities of the series. If any such
withholding shall be required, then such Officers' Certificate shall specify by
country the amount, if any, required to be withheld on such payments to such
Holders of Securities of that series or related coupons and the Company will pay
to the Trustee or such Paying Agent the Additional Amounts required by the terms
of such Securities. In the event that the Trustee or any Paying Agent, as the
case may be, shall not so receive the above-mentioned certificate, then the
Trustee or such Paying Agent shall be entitled (i) to assume that no such
withholding or deduction is required with respect to any payment of principal or
interest with respect to any Securities of a series or related coupons until it
shall have received a certificate advising otherwise and (ii) to make all
payments of principal and interest with respect to the Securities of a series or
related coupons without withholding or deductions until otherwise advised. The
Company covenants to indemnify the
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Trustee and any Paying Agent for, and to hold them harmless against, any loss,
liability or expense reasonably incurred without negligence or bad faith on
their part arising out of or in connection with actions taken or omitted by any
of them or in reliance on any Officers' Certificate furnished pursuant to this
Section or in reliance on the Company's not furnishing such an Officers'
Certificate.
Section 1008. Waiver of Certain Covenants. The Company may omit in any
particular instance to comply with any term, provision or condition set forth in
Sections 1004 or 1005, if before or after the time for such compliance the
Holders of at least a majority in principal amount of all outstanding Securities
of such series, 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
term, provision or condition shall remain in full force and effect.
ARTICLE 11
REDEMPTION OF SECURITIES
Section 1101. Applicability of Article. Securities of any series which
are redeemable before their Stated Maturity shall be redeemable in accordance
with their terms and (except as otherwise specified as contemplated by Section
301 for Securities of any series) in accordance with this Article.
Section 1102. Election to Redeem; Notice to Trustee. The election of
the Company to redeem any Securities shall be evidenced by or pursuant to a
Board Resolution. In case of any redemption at the election of the Company of
less than all of the Securities of any series, the Company shall, at least 45
days prior to the giving of the notice of redemption in Section 1104 (unless a
shorter notice shall be satisfactory to the Trustee), notify the Trustee of such
Redemption Date and of the principal amount of Securities of such series to be
redeemed. In the case of any redemption of Securities prior to the expiration of
any restriction on such redemption provided in the terms of such Securities or
elsewhere in this Indenture, the Company shall furnish the Trustee with an
Officers' Certificate evidencing compliance with such restriction.
Section 1103. Selection by Trustee of Securities to Be Redeemed. If
less than all the Securities of any series issued on the same day with the same
terms are to be redeemed, the particular Securities to be redeemed shall be
selected not more than 60 days prior to the Redemption Date by the Trustee, from
the Outstanding Securities of such series issued on such date with the same
terms not previously called for redemption, by such method as the Trustee shall
deem fair and appropriate and which may provide for the selection for redemption
of portions (equal to the minimum authorized denomination for Securities of that
series or any integral multiple thereof) of the principal amount of Securities
of such series of a denomination larger than the minimum authorized denomination
for Securities of that series.
The Trustee shall promptly notify the Company and the Security
Registrar (if other than itself) in writing of the Securities selected for
redemption and, in the case of any 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 Securities shall relate,
in the case of any Security redeemed or to be redeemed only in part, to the
portion of the principal amount of such 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 and as may be further specified in an
indenture supplemental hereto, not less than 30 days nor more than 60 days prior
to the Redemption Date, unless a shorter period is specified by the terms of
such series established pursuant to Section 301, to each Holder of Securities to
be redeemed, but failure to give such notice in the manner herein provided to
the Holder of any Security 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 Security or portion
thereof.
Any notice that is mailed to the Holders of Registered Securities in
the manner herein provided shall be conclusively presumed to have been duly
given, whether or not such Holders receive such notice.
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All notices of redemption shall state:
(1) the Redemption Date,
(2) the Redemption Price, accrued interest to the Redemption
Date payable as provided in Section 1106, if any, and Additional
Amounts, if any,
(3) if less than all Outstanding Securities of any series are
to be redeemed, the identification (and, in the case of partial
redemption, the principal amount) of the particular Security or
Securities to be redeemed,
(4) in case any Security is to be redeemed in part only, the
notice which relates to such Security shall state that on and after the
Redemption Date, upon surrender of such Security, the holder will
receive, without charge, a new Security or Securities of authorized
denominations for the principal amount thereof remaining unredeemed,
(5) that on the Redemption Date the Redemption Price and
accrued interest to the Redemption Date payable as provided in Section
1106, if any, will become due and payable upon each such Security, or
the portion thereof, to be redeemed and, if applicable, that interest
thereon shall cease to accrue on and after said date,
(6) the Place or Places of Payment where such Securities,
together in the case of Bearer Securities with all coupons appertaining
thereto, if any, maturing after the Redemption Date, are to be
surrendered for payment of the Redemption Price and accrued interest,
if any, or for conversion,
(7) that the redemption is for a sinking fund, if such is the
case,
(8) that unless otherwise specified in such notice, Bearer
Securities of any series, if any, surrendered for redemption must be
accompanied by all coupons maturing subsequent to the Redemption Date
or the amount of any such missing coupon or coupons will be deducted
from the Redemption Price, unless security or indemnity satisfactory to
the Company, the Trustee for such series and any Paying Agent is
furnished,
(9) if Bearer Securities of any series are to be redeemed and
any Registered Securities of such series are not to be redeemed, and if
such Bearer Securities may be exchanged for Registered Securities not
subject to redemption on this Redemption Date pursuant to Section 305
or otherwise, the last date, as determined by the Company, on which
such exchanges may be made,
(10) the CUSIP number of such Security, if any, and
(11) if applicable, that a Holder of Securities who desires to
convert Securities for redemption must satisfy the requirements for
conversion contained in such Securities, the then existing conversion
price or rate, and the date and time when the option to convert shall
expire.
Notice of redemption of Securities to be redeemed shall be given by the
Company or, at the Company's request, by the Trustee in the name and at the
expense of the Company.
Section 1105. Deposit of Redemption Price. On or prior to 11:00 am
(Boston time) on any 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,
which it may not do in the case of a sinking fund payment under Article 12,
segregate and hold in trust as provided in Section 1003) an amount of money in
the currency or currencies, currency unit or units or composite currency or
currencies in which the Securities of such series are payable (except as
otherwise specified pursuant to Section 301 for the Securities of such series)
sufficient to pay on the Redemption Date the Redemption Price of, and (except if
the Redemption Date shall be an Interest Payment Date) accrued interest on, all
the Securities or portions thereof which are to be redeemed on that date.
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Section 1106. Securities Payable on Redemption Date. Notice of
redemption having been given as aforesaid, the Securities so to be redeemed
shall, on the Redemption Date, become due and payable at the Redemption Price
therein specified in the currency or currencies, currency unit or units or
composite currency or currencies in which the Securities of such series are
payable (except as otherwise specified pursuant to Section 301 for the
Securities of such series) (together with accrued interest, if any, to the
Redemption Date), and from and after such date (unless the Company shall default
in the payment of the Redemption Price and accrued interest) such Securities
shall, if the same were interest-bearing, cease to bear interest and the coupons
for such interest appertaining to any Bearer Securities so to be redeemed,
except to the extent provided below, shall be void. Upon surrender of any such
Security for redemption in accordance with said notice, together with all
coupons, if any, appertaining thereto maturing after the Redemption Date, such
Security shall be paid by the Company at the Redemption Price, together with
accrued interest, if any, to the Redemption Date; provided, however, that
installments of interest on Bearer Securities whose Stated Maturity is on or
prior to the Redemption Date shall be payable only at an office or agency
located outside the United States (except as otherwise provided in Section 1002)
and, unless otherwise specified as contemplated by Section 301, only upon
presentation and surrender of coupons for such interest; and provided further
that, except as otherwise provided with respect to Securities convertible into
Common Shares or Preferred Shares of the Company, installments of interest on
Registered Securities whose Stated Maturity is on or prior to the Redemption
Date shall be payable to the Holders of such Securities, or one or more
Predecessor 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 Bearer Security surrendered for redemption shall not be
accompanied by all appurtenant coupons maturing after the Redemption Date, such
Security may be paid after deducting from the Redemption Price an amount equal
to the face amount of all such missing coupons, or the surrender of such missing
coupon or coupons may be waived by the Company and the Trustee if there be
furnished to them such security or indemnity as they may require to save each of
them and any Paying Agent harmless. If thereafter the Holder of such Security
shall surrender to the Trustee or any Paying Agent any such missing coupon in
respect of which a deduction shall have been made from the Redemption Price,
such Holder shall be entitled to receive the amount so deducted; provided,
however, that interest represented by coupons shall be payable only at an office
or agency located outside the United States (except as otherwise provided in
Section 1002) and, unless otherwise specified as contemplated by Section 301,
only upon presentation and surrender of those coupons.
If any 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 from the Redemption Date at the rate borne by the
Security.
Section 1107. Securities Redeemed in Part. Any Registered Security
which is to be redeemed only in part (pursuant to the provisions of this Article
or of Article 12) shall be surrendered at a Place of Payment therefor (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 Security without service charge a new Security or Securities of
the same series, of any authorized denomination as requested by such Holder in
aggregate principal amount equal to and in exchange for the unredeemed portion
of the principal of the Security so surrendered.
ARTICLE 12
SINKING FUNDS
Section 1201. Applicability of Article. The provisions of this Article
shall be applicable to any sinking fund for the retirement of Securities of a
series except as otherwise specified as contemplated by Section 301 for
Securities of such series.
The minimum amount of any sinking fund payment provided for by the
terms of Securities of any series is herein referred to as a "mandatory sinking
fund payment", and any payment in excess of such minimum amount provided for by
the terms of such Securities of any series is herein referred to as an "optional
sinking fund payment". If provided for by the terms of any Securities of any
series, the cash amount of any mandatory sinking fund payment may be subject
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to reduction as provided in Section 1202. Each sinking fund payment shall be
applied to the redemption of Securities of any series as provided for by the
terms of Securities of such series.
Section 1202. Satisfaction of Sinking Fund Payments with Securities.
The Company may, in satisfaction of all or any part of any mandatory sinking
fund payment with respect to the Securities of a series, (1) deliver Outstanding
Securities of such series (other than any previously called for redemption)
together in the case of any Bearer Securities of such series with all unmatured
coupons appertaining thereto and (2) apply as a credit Securities of such series
which have been redeemed either at the election of the Company pursuant to the
terms of such Securities or through the application of permitted optional
sinking fund payments pursuant to the terms of such Securities, as provided for
by the terms of such Securities, or which have otherwise been acquired by the
Company; provided that such Securities so delivered or applied as a credit have
not been previously so credited. Such Securities shall be received and credited
for such purpose by the Trustee at the applicable Redemption Price specified in
such Securities for redemption through operation of the sinking fund and the
amount of such mandatory sinking fund payment shall be reduced accordingly.
Section 1203. Redemption of Securities for Sinking Fund. Not less than
60 days prior to each sinking fund payment date for Securities of any series,
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 in the currency or currencies, currency unit or
units or composite currency or currencies in which the Securities of such series
are payable (except as otherwise specified pursuant to Section 301 for the
Securities of such series) and the portion thereof, if any, which is to be
satisfied by delivering and crediting 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
Securities to be so delivered and credited. 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 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 Securities shall be made upon the terms and in the
manner stated in Sections 1106 and 1107.
ARTICLE 13
REPAYMENT AT THE OPTION OF HOLDERS
Section 1301. Applicability of Article. Repayment of Securities of any
series before their Stated Maturity at the option of Holders thereof shall be
made in accordance with the terms of such Securities, if any, and (except as
otherwise specified by the terms of such series established pursuant to Section
301) in accordance with this Article.
Section 1302. Repayment of Securities. Securities of any series subject
to repayment in whole or in part at the option of the Holders thereof will,
unless otherwise provided in the terms of such Securities, be repaid at a price
equal to the principal amount thereof, together with interest, if any, thereon
accrued to the Repayment Date specified in or pursuant to the terms of such
Securities. The Company covenants that on or before the Repayment Date it will
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 in the currency or currencies, currency unit or units or
composite currency or currencies in which the Securities of such series are
payable (except as otherwise specified pursuant to Section 301 for the
Securities of such series) sufficient to pay the principal (or, if so provided
by the terms of the Securities of any series, a percentage of the principal) of,
and (except if the Repayment Date shall be an Interest Payment Date) accrued
interest on, all the Securities or portions thereof, as the case may be, to be
repaid on such date.
Section 1303. Exercise of Option. Securities of any series subject to
repayment at the option of the Holders thereof will contain an "Option to Elect
Repayment" form on the reverse of such Securities. In order for any Security to
be repaid at the option of the Holder, the Trustee must receive at the Place of
Payment therefor specified in the terms of such Security (or at such other place
or places of which the Company shall from time to time notify the Holders of
such Securities) not earlier than 60 days nor later than 30 days prior to the
Repayment Date (1) the Security so providing for such repayment together with
the "Option to Elect Repayment" form on the reverse thereof duly completed by
the
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Holder or by the Holder's attorney duly authorized in writing or (2) a telegram,
telex, facsimile transmission or a letter from a member of a national securities
exchange, or the National Association of Securities Dealers, Inc. ("NASD"), or a
commercial bank or trust company in the United States setting forth the name of
the Holder of the Security, the principal amount of the Security, the principal
amount of the Security to be repaid, the CUSIP number, if any, or a description
of the tenor and terms of the Security, a statement that the option to elect
repayment is being exercised thereby and a guarantee that the Security to be
repaid, together with the duly completed form entitled "Option to Elect
Repayment" on the reverse of the Security, will be received by the Trustee not
later than the fifth Business Day after the date of such telegram, telex,
facsimile transmission or letter; provided, however, that such telegram, telex,
facsimile transmission or letter shall only be effective if such Security and
form duly completed are received by the Trustee by such fifth Business Day. If
less than the entire principal amount of such Security is to be repaid in
accordance with the terms of such Security, the principal amount of such
Security to be repaid, in increments of the minimum denomination for Securities
of such series, and the denomination or denominations of the Security or
Securities to be issued to the Holder for the portion of the principal amount of
such Security surrendered that is not to be repaid, must be specified. The
principal amount of any security providing for repayment at the option of the
Holder thereof may not be repaid in part if, following such repayment, the
unpaid principal amount of such Security would be less than the minimum
authorized denomination of Securities of the series of which such Security to be
repaid is a part. Except as otherwise may be provided by the terms of any
Security providing for repayment at the option of the Holder thereof, exercise
of the repayment option by the Holder shall be irrevocable unless waived by the
Company.
Section 1304. When Securities Presented for Repayment Become Due and
Payable. If Securities of any series providing for repayment at the option of
the Holders thereof shall have been surrendered as provided in this Article and
as provided by or pursuant to the terms of such Securities, such Securities or
the portions thereof, as the case may be, to be repaid shall become due and
payable and shall be paid by the Company on the Repayment Date therein
specified, and on and after such Repayment Date (unless the Company shall
default in the payment of such Securities on such Repayment Date) such
Securities shall, if the same were interest-bearing, cease to bear interest and
the coupons for such interest appertaining to any Bearer Securities so to be
repaid, except to the extent provided below, shall be void. Upon surrender of
any such Security for repayment in accordance with such provisions, together
with all coupons, if any, appertaining thereto maturing after the Repayment
Date, the principal amount of such Security so to be repaid shall be paid by the
Company, together with accrued interest, if any, to the Repayment Date;
provided, however, that coupons whose Stated Maturity is on or prior to the
Repayment Date shall be payable only at an office or agency located outside the
United States (except as otherwise provided in Section 1002) and, unless
otherwise specified pursuant to Section 301, only upon presentation and
surrender of such coupons; and provided further that, in the case of Registered
Securities, installments of interest, if any, whose Stated Maturity is on or
prior to the Repayment Date shall be payable (but without interest thereon,
unless the Company shall default in the payment thereof) to the Holders of such
Securities, or one or more Predecessor 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 Bearer Security surrendered for repayment shall not be
accompanied by all appurtenant coupons maturing after the Repayment Date, such
Security may be paid after deducting from the amount payable therefor as
provided in Section 1302 an amount equal to the face amount of all such missing
coupons, or the surrender of such missing coupon or coupons may be waived by the
Company and the Trustee if there be furnished to them such security or indemnity
as they may require to save each of them and any Paying Agent harmless. If
thereafter the Holder of such Security shall surrender to the Trustee or any
Paying Agent any such missing coupon in respect of which a deduction shall have
been made as provided in the preceding sentence, such Holder shall be entitled
to receive the amount so deducted; provided, however, that interest represented
by coupons shall be payable only at an office or agency located outside the
United States (except as otherwise provided in Section 1002) and, unless
otherwise specified as contemplated by Section 301, only upon presentation and
surrender of those coupons.
If the principal amount of any Security surrendered for repayment shall
not be so repaid upon surrender thereof, such principal amount (together with
interest, if any, thereon accrued to such Repayment Date) shall, until paid,
bear interest from the Repayment Date at the rate of interest or Yield to
Maturity (in the case of Original Issue Discount Securities) set forth in such
Security.
Section 1305. Securities Repaid in Part. Upon surrender of any
Registered Security which is to be repaid in part only, the Company shall
execute and the Trustee shall authenticate and deliver to the Holder of such
Security, without service charge and at the expense of the Company, a new
Registered Security or Securities of the same series,
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of any authorized denomination specified by the Holder, in an aggregate
principal amount equal to and in exchange for the portion of the principal of
such Security so surrendered which is not to be repaid.
ARTICLE 14
DEFEASANCE AND COVENANT DEFEASANCE
Section 1401. Applicability of Article; Company's Option to Effect
Defeasance or Covenant Defeasance. If, pursuant to Section 301, provision is
made for either or both of (a) defeasance of the Securities of or within a
series under Section 1402 or (b) covenant defeasance of the Securities of or
within a series under Section 1403, then the provisions of such Section or
Sections, as the case may be, together with the other provisions of this Article
(with such modifications thereto as may be specified pursuant to Section 301
with respect to any Securities), shall be applicable to such Securities and any
coupons appertaining thereto, and the Company may at its option by Board
Resolution, at any time, with respect to such Securities and any coupons
appertaining thereto, elect to have Section 1402 (if applicable) or Section 1403
(if applicable) be applied to such Outstanding Securities and any coupons
appertaining thereto upon compliance with the conditions set forth below in this
Article.
Section 1402. Defeasance and Discharge. Upon the Company's exercise of
the above option applicable to this Section with respect to any Securities of or
within a series, the Company shall be deemed to have been discharged from its
obligations with respect to such Outstanding Securities and any coupons
appertaining thereto on the date the conditions set forth in Section 1404 are
satisfied (hereinafter, "defeasance"). For this purpose, such defeasance means
that the Company shall be deemed to have paid and discharged the entire
indebtedness represented by such Outstanding Securities and any coupons
appertaining thereto, which shall thereafter be deemed to be "Outstanding" only
for the purposes of Section 1405 and the other Sections of this Indenture
referred to in clauses (A) and (B) below, and to have satisfied all of its other
obligations under such Securities and any coupons appertaining thereto and this
Indenture insofar as such Securities and any coupons appertaining thereto are
concerned (and the Trustee, at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following which shall
survive until otherwise terminated or discharged hereunder: (A) the rights of
Holders of such Outstanding Securities and any coupons appertaining thereto to
receive, solely from the trust fund described in Section 1404 and as more fully
set forth in such Section, payments in respect of the principal of (and premium,
if any) and interest, if any, on such Securities and any coupons appertaining
thereto when such payments are due, (B) the Company's obligations with respect
to such Securities under Sections 305, 306, 1002 and 1003 and with respect to
the payment of Additional Amounts, if any, on such Securities as contemplated by
Section 1007, (C) the rights, powers, trusts, duties and immunities of the
Trustee hereunder and (D) this Article 14. Subject to compliance with this
Article 14, the Company may exercise its option under this Section
notwithstanding the prior exercise of its option under Section 1403 with respect
to such Securities and any coupons appertaining thereto.
Section 1403. Covenant Defeasance. Upon the Company's exercise of the
above option applicable to this Section with respect to any Securities of or
within a series, the Company shall be released from its obligations under
Sections 1004 and 1005 and, if specified pursuant to Section 301, its
obligations under any other covenant, with respect to such Outstanding
Securities and any coupons appertaining thereto on and after the date the
conditions set forth in Section 1404 are satisfied (hereinafter, "covenant
defeasance"), and such Securities and any coupons appertaining thereto shall
thereafter be deemed to be not "Outstanding" for the purposes of any direction,
waiver, consent or declaration or Act of Holders (and the consequences of any
thereof) in connection with Sections 1004 and 1005 or such other covenant, but
shall continue to be deemed "Outstanding" for all other purposes hereunder. For
this purpose, such covenant defeasance means that, with respect to such
Outstanding Securities and any coupons appertaining thereto, the Company may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such Section or such other covenant,
whether directly or indirectly, by reason of any reference elsewhere herein to
any such Section or such other covenant or by reason of reference in any such
Section or such other covenant to any other provision herein or in any other
document and such omission to comply shall not constitute a default or an Event
of Default under Section 501(4) or 501(9) or otherwise, as the case may be, but
except as specified above, the remainder of this Indenture and such Securities
and any coupons appertaining thereto shall be unaffected thereby.
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Section 1404. Conditions to Defeasance or Covenant Defeasance. The
following shall be the conditions to application of Section 1402 or Section 1403
to any Outstanding Securities of or within a series and any coupons appertaining
thereto:
(a) The Company shall irrevocably have deposited or
caused to be deposited with the Trustee (or another trustee
satisfying the requirements of Section 607 who shall agree to
comply with the provisions of this Article 14 applicable to
it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and
dedicated solely to, the benefit of the Holders of such
Securities and any coupons appertaining thereto, (1) an amount
in such currency, currencies or currency unit in which such
Securities and any coupons appertaining thereto are then
specified as payable at Stated Maturity) which through the
scheduled payment of principal and interest in respect thereof
in accordance with their terms will provide, not later than
one day before the due date of any payment of principal of
(and premium, if any) and interest, if any, on such Securities
and any coupons appertaining thereto, or (2) Government
Obligations applicable to such Securities and coupons
appertaining thereto (determined on the basis of the currency,
currencies or currency unit in which such Securities and
coupons appertaining thereto are then specified as payable at
Stated Maturity) which through the scheduled payment of
principal and interest in respect thereof in accordance with
their terms will provide, not later than one day before the
due date of any payment of principal of (and premium, if any)
and interest, if any, on such Securities and any coupons
appertaining thereto, money in an amount, or (3) a combination
thereof in an amount, sufficient, in the opinion of a
nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the
Trustee, to pay and discharge, and which shall be applied by
the Trustee (or other qualifying trustee) to pay and
discharge, (i) the principal of (and premium, if any) and
interest, if any, on such Outstanding Securities and any
coupons appertaining thereto on the Stated Maturity of such
principal or installment of principal or interest and (ii) any
mandatory sinking fund payments or analogous payments
applicable to such Outstanding Securities and any coupons
appertaining thereto on the day on which such payments are due
and payable in accordance with the terms of this Indenture and
of such Securities and any coupons appertaining thereto.
(b) Such defeasance or covenant defeasance shall not
result in a breach or violation of, or constitute a default
under, this Indenture or any other material agreement or
instrument to which the Company is a party or by which it is
bound.
(c) No Event of Default or event which with notice or
lapse of time or both would become an Event of Default with
respect to such Securities and any coupons appertaining
thereto shall have occurred and be continuing on the date of
such deposit or, insofar as Sections 501(6) and 501(7) are
concerned, at any time during the period ending on the 91st
day after the date of such deposit (it being understood that
this condition shall not be deemed satisfied until the
expiration of such period).
(d) In the case of an election under Section 1402,
the Company shall have delivered to the Trustee an Opinion of
Counsel stating that (i) the Company has received from, or
there has been published by, the Internal Revenue Service a
ruling, or (ii) since the date of execution of this Indenture,
there has been a change in the applicable Federal income tax
law, in either case to the effect that, and based thereon such
opinion shall confirm that, the Holders of such Outstanding
Securities and any coupons appertaining thereto will not
recognize income, gain or loss for Federal income tax purposes
as a result of such defeasance and will be subject to Federal
income tax on the same amounts, in the same manner and at the
same times as would have been the case if such defeasance had
not occurred.
(e) In the case of an election under Section 1403,
the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that the Holders of such Outstanding
Securities and any coupons appertaining thereto will not
recognize income, gain or loss for Federal income tax purposes
as a result of such covenant defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and
at the same times as would have been the case if such covenant
defeasance had not occurred.
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(f) The Company shall have delivered to the Trustee
an Officers' Certificate and an Opinion of Counsel, each
stating that all conditions precedent to the defeasance under
Section 1402 or the covenant defeasance under Section 1403 (as
the case may be) have been complied with and an Opinion of
Counsel to the effect that either (i) as a result of a deposit
pursuant to subsection (a) above and the related exercise of
the Company's option under Section 1402 or Section 1403 (as
the case may be), registration is not required under the
Investment Company Act of 1940, as amended, by the Company,
with respect to the trust funds representing such deposit or
by the Trustee for such trust funds or (ii) all necessary
registrations under said Act have been effected.
(g) Notwithstanding any other provisions of this
Section, such defeasance or covenant defeasance shall be
effected in compliance with any additional or substitute
terms, conditions or limitations which may be imposed on the
Company in connection therewith pursuant to Section 301.
Section 1405. Deposited Money and Government Obligations to Be Held in
Trust; Other Miscellaneous Provisions. Subject to the provisions of the last
paragraph of Section 1003, all money and Government Obligations (or other
property as may be provided pursuant to Section 301) (including the proceeds
thereof) deposited with the Trustee (or other qualifying trustee, collectively
for purposes of this Section 1405, the "Trustee") pursuant to Section 1404 in
respect of any Outstanding Securities of any series and any coupons appertaining
thereto shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and any coupons appertaining thereto and 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 Holders of such Securities and any coupons appertaining
thereto of all sums due and to become due thereon in respect of principal (and
premium, if any) and interest and Additional Amounts, if any, but such money
need not be segregated from other funds except to the extent required by law.
Unless otherwise specified with respect to any Security pursuant to
Section 301, if, after a deposit referred to in Section 1404(a) has been made,
(a) the Holder of a Security in respect of which such deposit was made is
entitled to, and does, elect pursuant to Section 301 or the terms of such
Security to receive payment in a currency or currency unit other than that in
which the deposit pursuant to Section 1404(a) has been made in respect of such
Security, or (b) a Conversion Event occurs in respect of the currency or
currency unit in which the deposit pursuant to Section 1404(a) has been made,
the indebtedness represented by such Security and any coupons appertaining
thereto shall be deemed to have been, and will be, fully discharged and
satisfied through the payment of the principal of (and premium, if any), and
interest, if any, on such Security as the same becomes due out of the proceeds
yielded by converting (from time to time as specified below in the case of any
such election) the amount or other property deposited in respect of such
Security into the currency or currency unit in which such Security becomes
payable as a result of such election or Conversion Event based on the applicable
market exchange rate for such currency or currency unit in effect on the second
Business Day prior to each payment date, in the case of such an election, or,
the applicable market exchange rate in effect for such currency or currency unit
(as nearly as feasible), in the case of such Conversion Event.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the Government Obligations deposited
pursuant to Section 1404 or the principal and interest received in respect
thereof other than any such tax, fee or other charge which by law is for the
account of the Holders of such Outstanding Securities and any coupons
appertaining thereto.
Anything in this Article to the contrary notwithstanding, the Trustee
shall deliver or pay to the Company from time to time upon Company Request any
money or Government Obligations (or other property and any proceeds therefrom)
held by it as provided in Section 1404 which, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, are in excess of the amount
thereof which would then be required to be deposited to effect a defeasance or
covenant defeasance, as applicable, in accordance with this Article.
ARTICLE 15
MEETINGS OF HOLDERS OF SECURITIES
49
<PAGE>
Section 1501. Purposes for Which Meetings May Be Called. A meeting of
Holders of Securities of any series may be called at any time and from time to
time pursuant to this Article to make, give or take any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be made, given or taken by Holders of Securities of such
series.
Section 1502. Call, Notice and Place of Meetings.
(a) The Trustee may at any time call a meeting of Holders of Securities
of any series for any purpose specified in Section 1501, to be held at such time
and at such place in the City of Boston, or in London as the Trustee shall
determine. Notice of every meeting of Holders of Securities of any series,
setting forth the time and the place of such meeting and in general terms the
action proposed to be taken at such meeting, shall be given, in the manner
provided in Section 106, not less than 21 nor more than 180 days prior to the
date fixed for the meeting.
(b) In case at any time the Company, pursuant to a Board Resolution, or
the Holders of at least 25% in principal amount of the Outstanding Securities of
any series shall have requested the Trustee to call a meeting of the Holders of
Securities of such series for any purpose specified in Section 1501, by written
request setting forth in reasonable detail the action proposed to be taken at
the meeting, and the Trustee shall not have made the first publication of the
notice of such meeting within 21 days after receipt of such request or shall not
thereafter proceed to cause the meeting to be held as provided herein, then the
Company or the Holders of Securities of such series in the amount above
specified, as the case may be, may determine the time and the place in the City
of Boston, or in London for such meeting and may call such meeting for such
purposes by giving notice thereof as provided in subsection (a) of this Section.
Section 1503. Persons Entitled to Vote at Meetings. To be entitled to
vote at any meeting of Holders of Securities of any series, a Person shall be
(1) a Holder of one or more Outstanding Securities of such series, or (2) a
Person appointed by an instrument in writing as proxy for a Holder or Holders of
one or more Outstanding Securities of such series by such Holder or Holders. The
only Persons who shall be entitled to be present or to speak at any meeting of
Holders of Securities of any series shall be the Persons entitled to vote at
such meeting and their counsel, any representatives of the Trustee and its
counsel and any representatives of the Company and its counsel.
Section 1504. Quorum; Action. The Persons entitled to vote a majority
in principal amount of the Outstanding Securities of a series shall constitute a
quorum for a meeting of Holders of Securities of such series; provided, however,
that if any action is to be taken at such meeting with respect to a consent or
waiver which this Indenture expressly provides may be given by the Holders of
not less than a specified percentage in principal amount of the Outstanding
Securities of a series, the Persons entitled to vote such specified percentage
in principal amount of the Outstanding Securities of such series shall
constitute a quorum. In the absence of a quorum within 30 minutes after the time
appointed for any such meeting, the meeting shall, if convened at the request of
Holders of Securities of such series, be dissolved. In any other case the
meeting may be adjourned for a period of not less than 10 days determined by the
chairman of the meeting prior to the adjournment of such meeting. In the absence
of a quorum at any such adjourned meeting, such adjourned meeting may be further
adjourned for a period of not less than 10 days as determined by the chairman of
the meeting prior to the adjournment of such adjourned meeting. Notice of the
reconvening of any adjourned meeting shall be given as provided in Section
1502(a), except that such notice need be given only once not less than five days
prior to the date on which the meeting is scheduled to be reconvened. Notice of
the reconvening of any adjourned meeting shall state expressly the percentage,
as provided above, of the principal amount of the Outstanding Securities of such
series which shall constitute a quorum.
Except as limited by the proviso to Section 902, any resolution
presented to a meeting or adjourned meeting duly reconvened at which a quorum is
present as aforesaid may be adopted by the affirmative vote of the Holders of a
majority in principal amount of the Outstanding Securities of that series;
provided, however, that, except as limited by the proviso to Section 902, any
resolution with respect to any request, demand, authorization, direction,
notice, consent, waiver or other action which this Indenture expressly provides
may be made, given or taken by the Holders of a specified percentage, which is
less than a majority, in principal amount of the Outstanding Securities of a
series may be adopted at a meeting or an adjourned meeting duly reconvened and
at which a quorum is present as aforesaid by the affirmative vote of the Holders
of such specified percentage in principal amount of the Outstanding Securities
of that series.
50
<PAGE>
Any resolution passed or decision taken at any meeting of Holders of
Securities of any series duly held in accordance with this Section shall be
binding on all the Holders of Securities of such series and the related coupons,
whether or not present or represented at the meeting.
Notwithstanding the foregoing provisions of this Section 1504, if any
action is to be taken at a meeting of Holders of Securities of any series with
respect to any request, demand, authorization, direction, notice, consent,
waiver or other action that this Indenture expressly provides may be made, given
or taken by the Holders of a specified percentage in principal amount of all
Outstanding Securities affected thereby, or of the Holders of such series and
one or more additional series:
(i) there shall be no minimum quorum requirement for such
meeting; and
(ii) the principal amount of the Outstanding Securities of
such series that vote in favor of such request, demand, authorization,
direction, notice, consent, waiver or other action shall be taken into
account in determining whether such request, demand, authorization,
direction, notice, consent, waiver or other action has been made, given
or taken under this Indenture.
Section 1505. Determination of Voting Rights; Conduct and Adjournment
of Meetings.
(a) Notwithstanding any provisions of this Indenture, the Trustee may
make such reasonable regulations as it may deem advisable for any meeting of
Holders of Securities of a series in regard to proof of the holding of
Securities of such series and of the appointment of proxies and in regard to the
appointment and duties of inspectors of votes, the submission and examination of
proxies, certificates and other evidence of the right to vote, and such other
matters concerning the conduct of the meeting as it shall deem appropriate.
Except as otherwise permitted or required by any such regulations, the holding
of Securities shall be proved in the manner specified in Section 104 and the
appointment of any proxy shall be proved in the manner specified in Section 104
or by having the signature of the Person executing the proxy witnessed or
guaranteed by any trust company, bank or banker authorized by Section 104 to
certify to the holding of Bearer Securities. Such regulations may provide that
written instruments appointing proxies, regular on their face, may be presumed
valid and genuine without the proof specified in Section 104 or other proof.
(b) The Trustee shall, by an instrument in writing appoint a temporary
chairman of the meeting, unless the meeting shall have been called by the
Company or by Holders of Securities as provided in Section 1502(b), in which
case the Company or the Holders of Securities of the series calling the meeting,
as the case may be, shall in like manner appoint a temporary chairman. A
permanent chairman and a permanent secretary of the meeting shall be elected by
vote of the Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting.
(c) At any meeting each Holder of a Security of such series or proxy
shall be entitled to one vote for each $1,000 principal amount of the
Outstanding Securities of such series held or represented by him; provided,
however, that no vote shall be cast or counted at any meeting in respect of any
Security challenged as not Outstanding and ruled by the chairman of the meeting
to be not Outstanding. The chairman of the meeting shall have no right to vote,
except as a Holder of a Security of such series or proxy.
(d) Any meeting of Holders of Securities of any series duly called
pursuant to Section 1502 at which a quorum is present may be adjourned from time
to time by Persons entitled to vote a majority in principal amount of the
Outstanding Securities of such series represented at the meeting, and the
meeting may be held as so adjourned without further notice.
Section 1506. Counting Votes and Recording Action of Meetings. The vote
upon any resolution submitted to any meeting of Holders of Securities of any
series shall be by written ballots on which shall be subscribed the signatures
of the Holders of Securities of such series or of their representatives by proxy
and the principal amounts and serial numbers of the Outstanding Securities of
such series held or represented by them. The permanent chairman of the meeting
shall appoint two inspectors of votes who shall count all votes cast at the
meeting for or against any resolution and who shall make and file with the
secretary of the meeting their verified written reports in duplicate of all
votes cast at the meeting. A record, at least in duplicate, of the proceedings
of each meeting of Holders of Securities of any Series shall be prepared by the
secretary of the meeting and there shall be attached to said record the original
reports of the
51
<PAGE>
inspectors of votes on any vote by ballot taken thereat and affidavits by one or
more persons having knowledge of the fact, setting forth a copy of the notice of
the meeting and showing that said notice was given as provided in Section 1502
and, if applicable Section 1504. Each copy shall be signed and verified by the
affidavits of the permanent chairman and secretary of the meeting and one such
copy shall be delivered to the Company and another to the Trustee to be
preserved by the Trustee, the latter to have attached thereto the ballots voted
at the meeting. Any record so signed and verified shall be conclusive evidence
of the matters therein stated.
This Indenture may be executed in any number of counterparts, each of
which when so executed shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same Indenture.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, and their respective corporate seals to be hereunto affixed and
attested, all as of the day and year first above written.
HEALTH AND RETIREMENT
PROPERTIES TRUST
By: /s/ David J. Hegarty
Title: President
STATE STREET BANK AND TRUST COMPANY
By: /s/ Robert L. Bice II
Title: Vice President
52
<PAGE>
EXHIBIT A
FORMS OF CERTIFICATION
EXHIBIT A-1
FORM OF CERTIFICATE TO BE GIVEN BY PERSON ENTITLED
TO RECEIVE BEARER SECURITY OR TO OBTAIN INTEREST
PAYABLE PRIOR TO THE EXCHANGE DATE
[Insert title or sufficient description of Securities to be delivered]
This is to certify that, as of the date hereof, and except as set forth
below, the above-captioned Securities held by you for our account (i) are owned
by person(s) that are not citizens or residents of the United States, domestic
partnerships, domestic corporations or any estate or trust the income of which
is subject to United States federal income taxation regardless of its source
("United States person(s)"), (ii) are owned by United States person(s) that are
(a) foreign branches of United States financial institutions (financial
institutions, as defined in United States Treasury Regulations Section
2.165-12(c)(1)(v) are herein referred to as "financial institutions") purchasing
for their own account or for resale, or (b) United States person(s) who acquired
the Securities through foreign branches of United States financial institutions
and who hold the Securities through such United States financial institutions on
the date hereof (and in either case (a) or (b), each such United States
financial institutions hereby agrees, on its own behalf or through its agent,
that you may advise Health and Rehabilitation Properties Trust or its agent that
such financial institutions will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the United States Internal Revenue Code of 1986, as
amended, and the regulations thereunder), or (iii) are owned by United States or
foreign financial institution(s) for purposes of resale during the restricted
period (as defined in United States Treasury Regulations Section
1.163-5(c)(1)(i)(D)(7), and, in addition, if the owner is a United States or
foreign financial institutions described in clause (iii) above (whether or not
also described in clause (i) or (ii)), this is to further certify that such
financial institutions has not acquired the Securities for purposes of resale
directly or indirectly to a United States person or to a person within the
United States or its possessions.
As used herein, "United States" means the United States of America
(including the States and the District of Columbia); and its "possessions"
include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island
and the Northern Mariana Islands.
We undertake to advise you promptly by tested telex on or prior to the
date on which you intend to submit your certification relating to the
above-captioned Securities held by you for our account in accordance with your
Operating Procedures if any applicable statement herein is not correct on such
date, and in the absence of any such notification it may be assumed that this
certification applies as of such date.
This certificate excepts and does not relate to (U.S.$) _______________
of such interest in the above-captioned Securities in respect of which we are
not able to certify and as to which we understand an exchange for an interest in
a Permanent Global Security or an exchange for and delivery of definitive
Securities (or, if relevant, collection of any interest) cannot be made until we
do so certify.
1
<PAGE>
We understand that this certificate may be required in connection with
certain tax legislation in the United States. If administrative or legal
proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Dated: , 19
[To be dated no earlier than the 15th day prior
to (i) the Exchange Date or (ii) the relevant
Interest Payment Date occurring prior to the
Exchange Date, as applicable]
[Name of Person Making Certification]
(Authorized Signatory)
Name:
Title:
2
<PAGE>
EXHIBIT A-2
FORM OF CERTIFICATE TO BE GIVEN BY EUROCLEAR
AND CEDEL S.A. IN CONNECTION WITH THE EXCHANGE OF
A PORTION OF A TEMPORARY GLOBAL SECURITY OR TO
OBTAIN INTEREST PAYABLE PRIOR TO THE EXCHANGE DATE
CERTIFICATE
[Insert title or sufficient description of Securities to be delivered]
This is to certify that, based solely on written certifications that we
have received in writing, by tested telex or by electronic transmission from
each of the persons appearing in our records as persons entitled to a portion of
the principal amount set forth below (our "Member Organizations") substantially
in the form attached hereto, as of the date hereof, [U.S.$] principal amount of
the above-captioned Securities (i) is owned by person(s) that are not citizens
or residents of the United States, domestic partnerships, domestic corporations
or any estate or trust the income of which is subject to United States Federal
income taxation regardless of its source ("United States person(s)"), (ii) is
owned by United States person(s) that are (a) foreign branches of United States
financial institutions (financial institutions, as defined in U.S. Treasury
Regulations Section 1.165-12(c)(1)(v) are herein referred to as "financial
institutions") purchasing for their own account or for resale, or (b) United
States person(s) who acquired the Securities through foreign branches of United
States financial institutions and who hold the Securities through such United
States financial institutions on the date hereof (and in either case (a) or (b),
each such financial institutions will comply with the requirements of Section
165(j)(3)(A), (B) or (C) of the Internal Revenue Code of 1986, as amended, and
the regulations thereunder), or (iii) is owned by United States or foreign
financial institution(s) for purposes of resale during the restricted period (as
defined in United States Treasury Regulations Section 1.163-5(c)(2)(i)(D)(7)),
and, to the further effect, that financial institutions described in clause
(iii) above (whether or not also described in clause (i) or (ii)) have certified
that they have not acquired the Securities for purposes of resale directly or
indirectly to a United States person or to a person within the United States or
its possessions.
As used herein, "United States" means the United States of America
(including the States and the District of Columbia); and its "possessions"
include Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island
and the Northern Mariana Islands.
We further certify that (i) we are not making available herewith for
exchange (or, if relevant, collection of any interest) any portion of the
temporary global Security representing the above-captioned Securities excepted
in the above-referenced certificates of Member Organizations and (ii) as of the
date hereof we have not received any notification from any of our Member
Organizations to the effect that the statements made by such Member
Organizations with respect to any portion of the part submitted herewith for
exchange (or, if relevant, collection of any interest) are no longer true and
cannot be relied upon as of the date hereof.
We understand that this certification is required in connection with
certain tax legislation in the United States. If administrative or legal
proceedings are commenced or threatened in connection with which this
certificate is or would be relevant, we irrevocably authorize you to produce
this certificate or a copy thereof to any interested party in such proceedings.
Date: 19
[To be dated no earlier than the Exchange Date or the relevant Interest Payment
Date occurring prior to the Exchange Date, as applicable]
[Morgan Guaranty Trust Company
New York, Brussels Office,]
as Operator of the Euroclear System
[Cedel S.A.]
3
EXHIBIT 4.2
SUPPLEMENTAL INDENTURE
by and between
HEALTH AND RETIREMENT PROPERTIES TRUST
and
STATE STREET BANK AND TRUST COMPANY
as of December 18, 1997
SUPPLEMENTAL TO THE INDENTURE DATED AS OF DECEMBER 18, 1997
------------------------------------
HEALTH AND RETIREMENT PROPERTIES TRUST
$150,000,000 6 3/4% Senior Notes due December 18, 2002
<PAGE>
This SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") made and
entered into as of December 18, 1997 between HEALTH AND RETIREMENT PROPERTIES
TRUST, a Maryland real estate investment trust (the "Company"), and STATE STREET
BANK AND TRUST COMPANY, a Massachusetts trust company, as Trustee (the
"Trustee").
WITNESSETH THAT:
WHEREAS, the Company and the Trustee have executed and delivered an
Indenture, dated as of December 18, 1997 (the "Indenture"), relating to the
Company's issuance, from time to time, of various series of debt securities; and
WHEREAS, the Company has determined to issue debt securities known as
its $150,000,000 6 3/4% Senior Notes due December 18, 2002; and
WHEREAS, the Indenture provides that certain terms and conditions for
each series of debt securities issued by the Company thereunder may be set forth
in an indenture supplemental to the Indenture;
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
ARTICLE 1
DEFINED TERMS
Section 1.1 The following definitions supplement, and, to the extent
inconsistent with, replace the definitions in Section 1.1 of the Indenture:
"Acquired Debt" means Debt of a Person (i) existing at the time such
Person becomes a Subsidiary or (ii) assumed in connection with the acquisition
of assets from such Person, in each case, other than Debt incurred in connection
with, or in contemplation of, such Person's becoming a Subsidiary or such
acquisition. Acquired Debt shall be deemed to be incurred on the date of the
related acquisition of assets from any Person or the date the acquired Person
becomes a Subsidiary.
"Annual Debt Service" as of any date means the maximum amount which is
expensed in any 12-month period for interest on Debt of the Company and its
Subsidiaries.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in The City of New York or in the city in which
the Corporate Trust Office of the Trustee is located, are required or authorized
to close.
"Capital Stock" means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participation or other ownership
interests (however designated) of such Person and any rights (other than debt
securities convertible into or exchangeable for capital stock), warrants or
options to purchase any thereof.
"Consolidated Income Available for Debt Service" for any period means
Earnings from Operations of the Company and its Subsidiaries plus amounts which
have been deducted, and minus amounts which have been added, for the following
(without duplication): (i) interest on Debt of the
<PAGE>
Company and its Subsidiaries, (ii) provision for taxes of the Company and its
Subsidiaries based on income, (iii) amortization of debt discount and deferred
financing costs, (iv) provisions for gains and losses on properties and property
depreciation and amortization, (v) the effect of any noncash charge resulting
from a change in accounting principles in determining Earnings from Operations
for such period and (vi) amortization of deferred charges.
"Debt" of the Company or any Subsidiary means, without duplication, any
indebtedness of the Company or any Subsidiary, whether or not contingent, in
respect of (i) borrowed money or evidenced by bonds, notes, debentures or
similar instruments, (ii) indebtedness for borrowed money secured by any
Encumbrance existing on property owned by the Company or any Subsidiary, (iii)
the reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued (other than letters of credit issued to
provide credit enhancement or support with respect to other indebtedness of the
Company or any Subsidiary otherwise reflected as Debt hereunder) or amounts
representing the balance deferred and unpaid of the purchase price of any
property or services, except any such balance that constitutes an accrued
expense or trade payable, or all conditional sale obligations or obligations
under any title retention agreement, (iv) the principal amount of all
obligations of the Company or any Subsidiary with respect to redemption,
repayment or other repurchase of any Disqualified Stock, or (v) any lease of
property by the Company or any Subsidiary as lessee which is reflected on the
Company's consolidated balance sheet as a capitalized lease in accordance with
GAAP, to the extent, in the case of items of indebtedness under (i) through
(iii) above, that any such items (other than letters of credit) would appear as
a liability on the Company's consolidated balance sheet in accordance with GAAP,
and also includes, to the extent not otherwise included, any obligation by the
Company or any Subsidiary to be liable for, or to pay, as obligor, guarantor or
otherwise (other than for purposes of collection in the ordinary course of
business), Debt of another Person (other than the Company or any Subsidiary) (it
being understood that Debt shall be deemed to be incurred by the Company or any
Subsidiary whenever the Company or such Subsidiary shall create, assume,
guarantee or otherwise become liable in respect thereof).
"Disqualified Stock" means, with respect to any Person, any Capital
Stock of such Person which by the terms of such Capital Stock (or by the terms
of any security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (i) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise
(other than Capital Stock which is redeemable solely in exchange for common
stock or shares), (ii) is convertible into or exchangeable or exercisable for
Debt or Disqualified Stock, or (iii) is redeemable at the option of the holder
thereof, in whole or in part (other than Capital Stock which is redeemable
solely in exchange for common stock or shares), in each case on or prior to the
Stated Maturity of the Notes.
"Earnings from Operations" for any period means net earnings excluding
gains and losses on sales of investments, extraordinary items and property
valuation losses, as reflected in the financial statements of the Company and
its Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP.
"Encumbrance" means any mortgage, lien, charge, pledge or security
interest of any kind.
-2-
<PAGE>
"Exchange Notes" means the senior notes of the Company with terms
substantially identical to the 6 3/4% Senior Notes due December 18, 2002 of the
Company issued in the Exchange Offer made by the Company pursuant to the
Registration Rights Agreement and this Supplemental Indenture.
"Exchange Offer" means the exchange offer registered under the
Securities Act made in accordance with the Registration Rights Agreement
pursuant to which the Company will exchange the Notes for senior notes of the
Company with substantially identical terms.
"Initial Purchaser" means Merrill Lynch, Pierce, Fenner & Smith
Incorporated
"Interest Payment Date" means any date interest is paid on the Notes.
"Issuance Date" means the closing date for the sale and original
issuance of the Notes.
"Liquidated Damages" has the meaning set out in the Registration Rights
Agreement.
"Make-Whole Amount" means, in connection with any optional redemption
or accelerated payment of any Note, the excess, if any, of (i) the aggregate
present value as of the date of such redemption or accelerated payment of each
dollar of principal being redeemed or paid and the amount of interest (exclusive
of interest accrued to the date of redemption or accelerated payment) that would
have been payable in respect of such dollar if such redemption or accelerated
payment had not been made, determined by discounting, on a semiannual basis,
such principal and interest at the Reinvestment Rate (determined on the third
Business Day preceding the date such notice of redemption is given or
declaration of acceleration is made) from the respective dates on which such
principal and interest would have been payable if such redemption or accelerated
payment had not been made, over (ii) the aggregate principal amount of the Notes
being redeemed or paid. For purposes of this Supplemental Indenture and the
Notes, references in the Indenture to the payment of the principal (and premium,
if any) and interest on the Notes shall be deemed to include the payment of the
Make-Whole Amount, if any, due upon redemption with respect to the Notes.
"Notes" means the Company's $150,000,000 aggregate principal amount of
6 3/4% Senior Notes, due December 18, 2002, issued under this Indenture
(including, without limitation, any Exchange Notes issued in respect of the
Notes in connection with the Exchange Offer), as amended or supplemented from
time to time.
"Record Date" means the fifteenth calendar day, whether or not a
Business Day, next preceding the applicable Interest Payment Date.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Issuance Date, by and among the Company and the
Initial Purchaser, as amended or supplemented from time to time.
"Reinvestment Rate" means 0.25% (twenty-five one hundredths of one
percent) plus the yield on treasury securities at constant maturity under the
heading "Week Ending" published in the Statistical Release under the caption
"Treasury Constant Maturities" for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the payment date of the
-3-
<PAGE>
principal being redeemed or paid. If no maturity exactly corresponds to such
maturity, yields for the two published maturities most closely corresponding to
such maturity shall be calculated pursuant to the immediately preceding sentence
and the Reinvestment Rate shall be interpolated or extrapolated from such yields
on a straight-line basis, rounding in each of such relevant periods to the
nearest month. For purposes of calculating the Reinvestment Rate, the most
recent Statistical Release published prior to the date of determination of the
Make-Whole Amount shall be used.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Regulation S" means Regulation S under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
"SEC" means the Securities and Exchange Commission.
"Secured Debt" means Debt secured by any mortgage, lien, charge, pledge
or security interest of any kind.
"Securities Act" means the Securities Act of 1933, as amended.
"Statistical Release" means the statistical release designated "H.
15(519)" or any successor publication which is published weekly by the Federal
Reserve System and which establishes yields on actively traded United States
government securities adjusted to constant maturities or, if such statistical
release is not published at the time of any determination under this
Supplemental Indenture, then any publicly available source of similar market
data which shall be designated by the Company.
"Subsidiary" means any corporation or other entity of which a majority
of (i) the voting power of the voting equity securities or (ii) the outstanding
equity interests of which are owned, directly or indirectly, by the Company or
one or more other Subsidiaries of the Company. For the purposes of this
definition, "voting equity securities" means equity securities having voting
power for the election of directors, whether at all times or only so long as no
senior class of security has such voting power by reason of any contingency.
"Total Assets" as of any date means the sum of (i) the Undepreciated
Real Estate Assets and (ii) all other assets of the Company and its Subsidiaries
determined in accordance with GAAP (but excluding accounts receivable and
intangibles).
"Total Unencumbered Assets" means the sum of (i) those Undepreciated
Real Estate Assets not subject to an Encumbrance for borrowed money and (ii) all
other assets of the Company and its Subsidiaries not subject to an Encumbrance
for borrowed money determined in accordance with GAAP (but excluding accounts
receivable and intangibles).
"Undepreciated Real Estate Assets" as of any date means the cost
(original cost plus capital improvements) of real estate assets of the Company
and its Subsidiaries on such date, before depreciation and amortization
determined on a consolidated basis in accordance with GAAP.
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"Unsecured Debt" means Debt which is not secured by any of the
properties of the Company or any Subsidiary.
ARTICLE 2
TERMS OF THE NOTES
Section 2.1 Pursuant to Section 3.1 of the Indenture, the Notes shall
have the following terms and conditions:
(a) Title; Limitation on Aggregate Principal Amount; Form of Notes. The
Notes shall be known as the Company's $150,000,000 6 3/4% Senior Notes due
December 18, 2002. The Notes will be limited to an aggregate principal amount of
$150,000,000. The Notes (together with the Trustee's certificate of
authentication) shall be substantially in the form of Exhibit A hereto (with the
appropriate legend or legends placed thereon), which is hereby incorporated in
and made a part of this Supplemental Indenture.
Notes offered and sold in offshore transactions in reliance on
Regulation S will be issued initially in the form of a permanent global
certificate in fully registered form without interest coupons substantially in
the form as above provided (the "Unrestricted Global Note"), and will be
registered in the name of a nominee of DTC and deposited with the Trustee as
custodian for DTC. On or prior to the 40th day after the later of the
commencement of the offering of the Notes and the Issuance Date (which date
shall be certified to the Trustee in an Officer's Certificate), beneficial
interests in the Unrestricted Global Note may be held only through Euroclear or
CEDEL. Beginning 41 days after the later of the commencement of the offering of
the Notes and the Issuance Date (but not earlier), such interests may also be
held through organizations other than Euroclear and CEDEL that are participants
in the DTC system.
Notes offered and sold in reliance on Rule 144A will be issued
initially in the form of a permanent global certificate in fully registered form
without interest coupons substantially in the form as above provided (the
"Restricted Global Note" and, together with the Unrestricted Global Note, the
"Global Notes") and will be registered in the name of a nominee of DTC and
deposited with the Trustee as custodian for DTC. The Notes sold to other
investors in the United States will be issued initially in the form of
individual certificates in fully registered form, without coupons. On or prior
to the 40th day after the later of the commencement of the offering of the Notes
and the Issuance Date, a beneficial interest in the Unrestricted Global Note may
be transferred to a Person who takes delivery in the form of an interest in the
Restricted Global Note only upon receipt by the Trustee of a written
certification from the transferor to the effect that such transfer is being made
to a Person whom the transferor reasonably believes to be a QIB purchasing Notes
for its own account or an account with respect to which it exercises sole
investment discretion in a transaction meeting the requirements of Rule 144A and
in accordance with any applicable securities laws of any state of the United
States or any other jurisdiction (a "Restricted Global Note Certification").
After such 40th day, such certification requirement will no longer apply to such
transfers. Beneficial interests in the Restricted Global Note may be transferred
to a Person who takes delivery in the form of an interest in the Unrestricted
Global Note, whether before, on or after such 40th day, only upon receipt by the
Trustee of a written certification from the transferor to the effect that such
transfer is
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being made in accordance with Rule 903 or 904 of Regulation S or Rule 144 under
the Securities Act (an "Unrestricted Global Note Certification"). Any beneficial
interest in one of the Global Notes that is transferred to a Person who takes
delivery in the form of an interest in the other Global Note will, upon
transfer, cease to be an interest in such Global Note and will become an
interest in the other Global Note and, accordingly, will thereafter be subject
to all transfer restrictions and other procedures and restrictions applicable to
beneficial interests in such other Global Note for as long as it remains such an
interest.
Ownership of beneficial interests in a Global Note will be limited to
Persons who have accounts with DTC ("DTC Participants") or Persons who hold
interests through DTC Participants. Ownership of beneficial interests in the
Global Notes will be shown on, and the transfer of that ownership will be
effected only through, records maintained by DTC or its nominee (with respect to
interests of DTC Participants) and the records of DTC Participants (with respect
to interests of Persons other than DTC Participants).
Individual definitive Notes issued in exchange for the Restricted
Global Note will bear, and be subject to, such legend as the Company requires in
order to assure compliance with any applicable law (which requirement shall be
evidenced by delivery to the Trustee of a Company Order setting forth such
legend). The holder of a restricted individual definitive Note may transfer such
Note, subject to compliance with the provisions of the legend as provided in
paragraph (d) below. Upon the transfer, exchange or replacement of Notes bearing
the legend, or upon specific request for removal of the legend on a Note, the
Company will deliver and the Trustee will authenticate only Notes that bear such
legend, or will refuse to remove such legend, as the case may be, unless there
is delivered to the Company such satisfactory evidence, which may include an
opinion of counsel, as may reasonably be required by the Company, that neither
the legend nor the restrictions on transfer set forth therein are required to
ensure compliance with the provisions of the Securities Act. Before any
individual definitive Note may be transferred to a Person who takes delivery in
the form of an interest in any Global Note, the transferor will be required to
provide the Trustee with a Restricted Global Note Certification or Unrestricted
Global Note Certification, as the case may be.
(b) Principal Repayment; Currency. The Stated Maturity of the Notes is
December 18, 2002, provided, however, the Notes may be earlier redeemed at the
option of the Company as provided in paragraph (c) below. The principal of each
Note payable on its maturity date shall be paid against presentation and
surrender thereof at the Corporate Trust Office of the Trustee, located
initially at Two International Place, Boston, Massachusetts 02110, in such coin
or currency of the United States of America as at the time of payment is legal
tender for the payment of public or private debts. The Company will not pay
Additional Amounts (as defined in the Indenture) on the Notes.
(c) Redemption at the Option of the Company. Prior to September 18,
2002, the Notes will be subject to redemption at any time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 day's
notice to each Holder of Notes to be redeemed at its address appearing in the
Security Register, at a price equal to the sum of (i) the principal amount of
the Notes being redeemed, plus accrued and unpaid interest and Liquidated
Damages, if any, to but excluding the applicable redemption date and (ii) the
Make-Whole Amount. On and after September 18, 2002, the Notes will be subject to
redemption at any time at the option of the Company, in whole
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or in part, upon not less than 30 nor more than 60 days' notice, at a redemption
price equal to the sum of the principal amount of the Notes being redeemed plus
accrued and unpaid interest and Liquidated Damages, if any, to but excluding the
applicable redemption date.
(d) Restrictive Legends. Unless and until a Note is exchanged for an
Exchange Note in connection with an effective registration pursuant to the
Registration Rights Agreement, each Note shall bear the following legend on the
face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND SUCH SECURITY MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) TO THE
COMPANY, (2) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
(3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904
OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE), OR (5) IN A TRANSACTION OTHERWISE EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY OTHER APPLICABLE LAW.
TRANSFERS AND EXCHANGES OF THIS SECURITY ARE SUBJECT TO RESTRICTIONS AS
PROVIDED IN THE INDENTURE.
Each Global Note, whether or not an Exchange Note, shall bear the
following legend on the face thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
(e) Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Company shall be directed
to it at 400 Centre Street, Newton, Massachusetts 02158, Attention: David J.
Hegarty, President; notices to the Trustee shall be directed to it at Two
International Place, Boston, Massachusetts 02110, Attention: Corporate Trust
Department Re: Health and Retirement Properties Trust 6 3/4% Senior Notes due
December 18, 2002.
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<PAGE>
ARTICLE 3
ADDITIONAL COVENANTS
Section 3.1 In addition to the covenants of the Company set forth in
Article Ten of the Indenture, for the benefit of the holders of the Notes:
(a) Limitations on Incurrence of Debt.
(i) The Company will not, and will not permit any Subsidiary
to, incur any Debt if, immediately after giving effect to the
incurrence of such additional Debt and the application of the proceeds
thereof, the aggregate principal amount of all outstanding Debt of the
Company and its Subsidiaries on a consolidated basis determined in
accordance with GAAP is greater than 60% of the sum ("Adjusted Total
Assets") of (without duplication) (i) the Total Assets of the Company
and its Subsidiaries as of the end of the calendar quarter covered in
the Company's Annual Report on Form 10-K, or the Quarterly Report on
Form 10-Q, as the case may be, most recently filed with the Securities
and Exchange Commission (or, if such filing is not permitted under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), with
the Trustee) prior to the incurrence of such additional Debt and (ii)
the purchase price of any real estate assets or mortgages receivable
acquired, and the amount of any securities offering proceeds received
(to the extent that such proceeds were not used to acquire real estate
assets or mortgages receivable or used to reduce Debt), by the Company
or any Subsidiary since the end of such calendar quarter, including
those proceeds obtained in connection with the incurrence of such
additional Debt.
(ii) In addition to the foregoing limitations on the
incurrence of Debt, the Company will not, and will not permit any
Subsidiary to, incur any Secured Debt if, immediately after giving
effect to the incurrence of such additional Secured Debt and the
application of the proceeds thereof, the aggregate principal amount of
all outstanding Secured Debt of the Company and its Subsidiaries on a
consolidated basis is greater than 40% of Adjusted Total Assets.
(iii) In addition to the foregoing limitations on the
Incurrence of Debt, the Company will not, and will not permit any
Subsidiary to, incur any Debt if the ratio of Consolidated Income
Available for Debt Service to the Annual Debt Service for the four
consecutive fiscal quarters most recently ended prior to the date on
which such additional Debt is to be incurred shall have been less than
1.5x, on a pro forma basis after giving effect thereto and to the
application of the proceeds therefrom, and calculated on the assumption
that (i) such Debt and any other Debt incurred by the Company and its
Subsidiaries since the first day of such four-quarter period and the
application of the proceeds therefrom, including to refinance other
Debt, had occurred at the beginning of such period; (ii) the repayment
or retirement of any other Debt by the Company and its Subsidiaries
since the first date of such four-quarter period had been repaid or
retired at the beginning of such period (except that, in making such
computation, the amount of Debt under any revolving credit facility
shall be computed based upon the average daily balance of such Debt
during such period); (iii) in the case of Acquired Debt or Debt
incurred in connection with any acquisition since the first day
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<PAGE>
of such four-quarter period, the related acquisition had occurred as of
the first day of such period with appropriate adjustments with respect
to such acquisition being included in such pro forma calculation; and
(iv) in the case of any acquisition or disposition by the Company or
its Subsidiaries of any asset or group of assets since the first day of
such four-quarter period, whether by merger, stock purchase or sale, or
asset purchase or sale, such acquisition or disposition or any related
repayment of Debt had occurred as of the first day of such period with
the appropriate adjustments with respect to such acquisition or
disposition being included in such pro forma calculation.
(b) Maintenance of Total Unencumbered Assets. The Company and its
Subsidiaries will maintain Total Unencumbered Assets of not less than 200% of
the aggregate outstanding principal amount of the Unsecured Debt of the Company
and its Subsidiaries on a consolidated basis.
(c) Applicability of Discharge, Defeasance and Covenant Defeasance
Provisions. The Discharge, Defeasance and Covenant Defeasance provisions in
Article Fourteen of the Indenture will apply to the Notes.
ARTICLE 4
ADDITIONAL EVENTS OF DEFAULT
For purposes of this Supplemental Indenture and the Notes, in addition
to the Events of Default set forth in Section 5.1 of the Indenture, it shall
also constitute an "Event of Default" if an event of default under any bond,
debenture, note or other evidence of indebtedness of the Company (including an
event of default with respect to any other series of securities), or under any
mortgage, indenture or other instrument of the Company under which there may be
issued or by which there may be secured or evidenced any indebtedness of the
Company (or by any Subsidiary, the repayment of which the Company has guaranteed
or for which the Company is directly responsible or liable as obligor or
guarantor), whether such indebtedness now exists or shall hereafter be created,
shall happen and shall result in an aggregate principal amount exceeding
$20,000,000 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 ten 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 Notes, a
written notice specifying such default and requiring the Company to cause such
indebtedness to be discharged or cause such acceleration to be rescinded or
annulled and stating that such notice is a "Notice of Default" hereunder.
ARTICLE 5
EFFECTIVENESS
This Supplemental Indenture shall be effective for all purposes as of
the date and time this Supplemental Indenture has been executed and delivered by
the Company and the Trustee in accordance with Article Nine of the Indenture. As
supplemented hereby, the Indenture is hereby confirmed as being in full force
and effect.
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ARTICLE 6
MISCELLANEOUS
Section 6.1 In the event any provision of this Supplemental Indenture
shall be held invalid or unenforceable by any court of competent jurisdiction,
such holding shall not invalidate or render unenforceable any other provision
hereof or any provision of the Indenture.
Section 6.2 To the extent that any terms of the Notes are inconsistent
with the terms of the Indenture, the terms of the Notes shall govern and
supersede such inconsistent terms.
Section 6.3 This Supplemental Indenture shall be governed by and
construed in accordance with the laws of The Commonwealth of Massachusetts.
Section 6.4 This Supplemental Indenture may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
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<PAGE>
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Supplemental Indenture to be executed as an instrument under seal in their
respective corporate names as of the date first above written.
HEALTH AND RETIREMENT PROPERTIES TRUST
By: /s/ David J. Hegarty
Name: David J. Hegarty
Title: President
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By: /s/ Robert L. Bice II
Name: Robert L. Bice II
Title: Vice President
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<PAGE>
EXHIBIT A
(Face of Note)
6 3/4% Senior Notes due December 18, 2002
No. $__________
HEALTH AND RETIREMENT PROPERTIES TRUST
promises to pay to _______________________________________ or registered
assigns, the principal sum of _____________________________________ Dollars on
December 18, 2002.
Interest Payment Dates: June 18 and December 18.
Record Dates: June 3 and December 3.
CUSIP Nos.: [422169AF9 (Rule 144A)
422169AG7 (Accredited Investor)
U40488 AC 9 (Regulation S)]
HEALTH AND RETIREMENT PROPERTIES
TRUST
By:____________________________________
Name:
Title:
[SEAL]
Dated:
This is one of the Notes referred to in the within-mentioned Indenture:
STATE STREET BANK AND TRUST COMPANY, as Trustee
By:
Authorized Signatory
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<PAGE>
(Back of Note)
HEALTH AND RETIREMENT PROPERTIES TRUST
6 3/4% Senior Notes due December 18, 2002
Capitalized terms used herein have the meanings assigned to them in the
Indenture (as defined below) unless otherwise indicated.
1. Interest. Health and Retirement Properties Trust, a Maryland real
estate investment trust (the "Company"), promises to pay interest on the
principal amount of this Note at the rate and in the manner specified below.
The Company shall pay in cash interest on the principal amount of this
Note at the rate per annum of 6 3/4%. The Company will pay interest
semi-annually in arrears on June 18 and December 18 of each year, commencing on
June 18, 1998 or if any such day is not a Business Day (as defined in the
Indenture), on the next succeeding Business Day (each an "Interest Payment
Date"), to Holders of record on the immediately preceding June 3 and December 3.
Interest will be computed on the basis of a 360-day year consisting of
twelve 30-day months. Interest shall accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of the
original issuance of the Notes.
2. Method of Payment. The Company will pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the record date next preceding the Interest Payment
Date, even if such Notes are canceled after such record date and on or before
such Interest Payment Date. The Company will pay principal and interest in money
of the United States that at the time of payment is legal tender for payment of
public and private debts. The Company, however, may pay principal, premium, if
any, and interest by check payable in such money. It may mail an interest check
to a Holder's registered address.
3. Indenture. The Company issued the Notes under an Indenture and a
Supplemental Indenture, each dated as of December 18, 1997 (the "Indenture")
between the Company and the Trustee. The terms of the Notes include those stated
in the Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939 (15 U.S. Code ss.ss. 77aaa-77bbbb) as in effect on the
date of the Indenture. The Notes are subject to all such terms, and Holders of
the Notes are referred to the Indenture and such act for a statement of such
terms. The terms of the Indenture shall govern any inconsistencies between the
Indenture and the Notes. The Notes are unsecured general obligations of the
Company limited to $150,000,000 in aggregate principal amount.
4. Optional Redemption. Prior to September 18, 2002, the Notes will be
subject to redemption at any time at the option of the Company, in whole or in
part, upon not less than 30 nor more than 60 days' notice, at a redemption price
equal to the sum of (i) the principal amount of the Notes being redeemed, plus
accrued and unpaid interest and Liquidated Damages (as defined in the
Supplemental Indenture), if any, to but excluding the applicable redemption date
and (ii) the Make- Whole Amount. On and after September 18, 2002, the Notes will
be subject to redemption at any time at the option of the Company, in whole or
in part, upon not less than 30 nor more than 60 days'
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notice, at a redemption price equal to the sum of (i) the principal amount of
the Notes being redeemed, plus accrued and unpaid interest and Liquidated
Damages, if any, to but excluding the applicable redemption date.
As used herein the term "Make-Whole Amount" means, in connection with
any optional redemption or accelerated payment of any Note, the excess, if any,
of (i) the aggregate present value as of the date of such redemption or
accelerated payment of each dollar of principal being redeemed or paid and the
amount of interest (exclusive of interest accrued to the date of redemption or
accelerated payment) that would have been payable in respect of such dollar if
such redemption or accelerated payment had not been made, determined by
discounting, on a semiannual basis, such principal and interest at the
Reinvestment Rate (as defined herein) (determined on the third Business Day
preceding the date such notice of redemption is given or declaration of
acceleration is made) from the respective dates on which such principal and
interest would have been payable if such redemption or accelerated payment had
not been made, over (ii) the aggregate principal amount of the Notes being
redeemed or paid.
As used herein the term "Reinvestment Rate" means 0.25% (twenty-five
one hundredths of one percent) plus the yield on treasury securities at constant
maturity under the heading "Week Ending" published in the Statistical Release
(as defined herein) under the caption "Treasury Constant Maturities" for the
maturity (rounded to the nearest month) corresponding to the remaining life to
maturity, as of the payment date of the principal being redeemed or paid. If no
maturity exactly corresponds to such maturity, yields for the two published
maturities most closely corresponding to such maturity shall be calculated
pursuant to the immediately preceding sentence and the Reinvestment Rate shall
be interpolated or extrapolated from such yields on a straight-line basis,
rounding in each of such relevant periods to the nearest month. For purposes of
calculating the Reinvestment Rate, the most recent Statistical Release published
prior to the date of determination of the Make-Whole Amount shall be used.
As used herein the term "Statistical Release" means the statistical
release designated "H. 15(519)" or any successor publication which is published
weekly by the Federal Reserve System and which establishes yields on actively
traded United States government securities adjusted to constant maturities or,
if such statistical release is not published at the time of any determination
under the Supplemental Indenture, then such other reasonably comparable index
which shall be designated by the Company.
5. Mandatory Redemption. The Company shall not be required to make
sinking fund or redemption payments with respect to the Notes.
6. Notice of Redemption. Notice of redemption shall be mailed at least
30 days but not more than 60 days before the redemption date to each Holder of
Notes to be redeemed at its registered address. Notes may be redeemed in part
but only in whole multiples of $1,000, unless all of the Notes held by a Holder
are to be redeemed. On and after the redemption date, interest ceases to accrue
on Notes or portions of them called for redemption.
7. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $100,000 and integral multiples of $1,000 in
excess thereof. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The
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<PAGE>
Registrar and the Trustee may require a Holder, among other things, to furnish
appropriate endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not exchange
or register the transfer of any Note or portion of a Note selected for
redemption. Also, it need not exchange or register the transfer of any Notes for
a period of 15 days before the mailing of a notice of redemption of Notes, or
during the period between a record date and the corresponding Interest Payment
Date.
8. Defaults and Remedies. In case an Event of Default (as defined in
the Indenture) with respect to the Notes shall have occurred and be continuing,
the principal hereof may be declared, and upon such declaration shall become,
due and payable, in the manner, with the effect and subject to the provisions
provided in the Indenture.
9. Actions of Holders. The Indenture contains provisions permitting the
holders of not less than a majority of the aggregate principal amount of the
outstanding Notes, on behalf of the holders of all such Notes at a meeting duly
called and held as provided in the Indenture, to make, give or take any request,
demand, authorization, direction, notice, consent, waiver or other action
provided in the Indenture to be made, given or taken by the holders of the
Notes, including without limitation, waiving (a) compliance by the Company with
certain provisions of the Indenture, and (b) certain past defaults under the
Indenture and their consequences. Any resolution passed or decision taken at any
meeting of the holders of the Notes in accordance with the provisions of the
Indenture shall be conclusive and binding upon such holders and upon all future
holders of this Note and other Notes issued upon the registration of transfer
hereof or in exchange heretofore or in lieu hereof
10. Persons Deemed Owners. The Company, the Trustee, and any agent of
the Company or the Trustee may deem and treat the Person in whose name this Note
is registered on the Security Register as its absolute owner for all purposes.
11. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
12. [Holders' Compliance with Registration Rights Agreement.1 Each
Holder of a Note, by his acceptance thereof, acknowledges and agrees to the
provisions of the Registration Rights Agreement, dated as of December 18, 1997
among the Company and the Initial Purchaser (as defined therein) (the
"Registration Rights Agreement"), including but not limited to the obligations
of the Holders with respect to a registration and the indemnification of the
Company and the Initial Purchaser (as defined therein) to the extent provided
therein.]
13. Governing Law. THE INTERNAL LAW OF THE COMMONWEALTH OF
MASSACHUSETTS SHALL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THE NOTES.
14. No Personal Liability. THE AMENDED AND RESTATED DECLARATION OF
TRUST OF THE COMPANY, DATED JULY 1, 1994, A COPY OF WHICH, TOGETHER WITH ALL
AMENDMENTS THERETO (THE "DECLARATION"), IS DULY FILED IN
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1 This paragraph should be deleted from Exchange Notes.
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<PAGE>
THE OFFICE OF THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF
MARYLAND, PROVIDES THAT THE NAME "HEALTH AND RETIREMENT PROPERTIES TRUST" REFERS
TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS TRUSTEES, BUT NOT
INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE
OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR
SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY. ALL PERSONS
DEALING WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THE
COMPANY FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement. Request
may be made to:
Health and Retirement Properties Trust
400 Centre Street
Newton, MA 02158
Telecopier No.: (617) 332-2261
Attention: President
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ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
(Insert assignee's soc. sec. or tax I.D. no.)
(Print or type assignee's name, address and zip code)
and irrevocably appoint
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
Your Signature:
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee:
EXHIBIT 5.1
[Sullivan & Worcester LLP Letterhead]
March 11, 1998
Health and Retirement Properties Trust
400 Centre Street
Newton, Massachusetts 02158
Ladies and Gentlemen:
In connection with the registration by Health and Retirement Properties
Trust, a Maryland real estate investment trust (the "Company"), of $150,000,000
of Senior Notes due 2002 (the "Notes"), which Notes will be issued under an
indenture and a supplement thereto (collectively, the "Indenture") relating to
the Notes by and between the Company and State Street Bank and Trust Company, as
Trustee (the "Trustee"), the following opinion is furnished to the Company to be
filed with the Securities and Exchange Commission (the "Commission") as Exhibit
5.1 to the Company's Registration Statement on Form S-4, under the Securities
Act of 1933, as amended (the "Securities Act"), to be filed on or about the date
hereof. As used in this opinion, the term "Registration Statement" means, unless
otherwise stated, such Registration Statement, as amended when declared
effective by the Commission (including any post-effective amendments thereto).
In connection with this opinion, we have examined and relied upon a
copy of the Registration Statement to be filed with the Commission on or about
the date hereof. We have also examined and relied upon originals or copies of
such records, agreements and instruments of the Company, certificates of public
officials and of officers of the Company and such other documents and records,
and such matters of law, as we have deemed necessary as a basis for the opinions
hereinafter expressed. In making such examination, we have assumed the
genuineness of all signatures, the legal capacity of natural persons, the
authenticity of all documents submitted to us as originals and the conformity to
the originals of all documents submitted to us as copies, which facts we have
not independently verified.
To the extent that the obligations of the Company under the Indenture
may be dependent upon such matters, we have assumed for purposes of this opinion
that the Trustee is duly organized, validly existing and in good standing under
the laws of its jurisdiction of organization, and is duly qualified to engage in
the activities contemplated by, and has the requisite organizational and legal
authority to perform its obligations under, the Indenture, that the Trustee will
be in compliance, generally with respect to acting as trustee or agent under the
Indenture, with all applicable laws and regulations, and that the Indenture will
be the valid and binding agreement of the Trustee, enforceable against the
Trustee in accordance with its terms.
We express no opinion herein as to the laws of any jurisdiction other
than the Commonwealth of Massachusetts and the federal law of the United States,
and we express no opinion as to state securities or blue sky laws. Insofar as
this opinion involves matters of Maryland law we have, with your permission,
relied solely on the opinion of Piper & Marbury L.L.P., a copy of which is being
filed herewith as Exhibit 5.2 to the Registration Statement, and our opinion is
subject to the exceptions, qualifications and limitations therein expressed.
<PAGE>
Health and Retirement Properties Trust
March 11, 1998
Page 2
Our opinions set forth below with respect to the validity or binding
effect of any security or obligation are subject to (i) limitations arising
under applicable bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws affecting the enforcement generally of the
rights and remedies of creditors and secured parties or the obligations of
debtors, (ii) general principles of equity (regardless of whether considered in
a proceeding at law or in equity), including, without limitation, the discretion
of any court of competent jurisdiction in granting specific performance or
injunctive or other equitable relief, and (iii) an implied duty on the part of
the party seeking to enforce rights or remedies to take action and make
determinations on a reasonable basis and in good faith to the extent required by
applicable law.
Based on and subject to the foregoing, we are of the opinion that, as
of the date hereof, the Notes will be validly issued and binding obligations of
the Company when (i) the Registration Statement shall have become effective
under the Securities Act and the Indenture shall have been qualified under the
Trust Indenture Act of 1939, as amended, and (ii) the Notes shall have been (A)
duly executed by the Company and authenticated by the Trustee as provided in the
Indenture and (B) shall have been duly delivered to the purchasers thereof, as
described in the Registration Statement and the prospectus included therein and
as provided in the Indenture.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to our firm in the Prospectus
forming a part of the Registration Statement. In giving such consent, we do not
thereby admit that we come within the category of persons whose consent is
required under Section 7 of the Act or under the rules and regulations of the
Commission promulgated thereunder.
Very truly yours,
/s/ Sullivan & Worcester LLP
SULLIVAN & WORCESTER LLP
Exhibit 5.2
PIPER & MARBURY WASHINGTON
L.L.P. NEW YORK
CHARLES CENTER SOUTH PHILADELPHIA
36 SOUTH CHARLES STREET EASTON
BALTIMORE, MARYLAND 21201-3018
410-539-2530
FAX: 410-539-0489
March 11, 1998
Sullivan & Worcester LLP
One Post Office Square
Boston, Massachusetts 02109
Re: Health and Retirement Properties Trust
Ladies and Gentlemen:
We have acted as special Maryland counsel for Health and Retirement
Properties Trust, a real estate investment trust organized under the laws of the
State of Maryland (the "Trust"), in connection with the registration statement
on form S-4 (the "Registration Statement") of the Trust with respect to the
registration of $150,000,000 aggregate principal amount of 6 3/4% Senior Notes
due 2002 (the "Exchange Notes").
In such capacity, we have reviewed the Registration Statement, the
Indenture dated as of December 18, 1997 between the Trust and State Street Bank
and Trust Company (the "Indenture"), the Supplemental Indenture dated December
18, 1997 between the Trust and State Street Bank and Trust Company (the
"Supplemental Indenture"), the Amended and Restated Declaration of Trust (the
"Declaration of Trust"), the Bylaws of the Trust (the "Bylaws"), the Offering
Memorandum dated December 15, 1997 relating to the offering of $150,000,000
aggregate principal amount of 6 3/4% Senior Notes due 2002, of the Trust (the
"Initial Notes"), certain minutes of proceedings of the Board of Trustees of the
Trust, a good standing certificate dated as of a recent date from the State
Department of Assessments and Taxation of Maryland, and such other documents,
trust records and certificates of public officials and officers of the Trust and
other instruments, and have conducted such other investigations of fact and law,
as we have deemed necessary or advisable for the purposes of rendering this
opinion.
In rendering this opinion we have assumed, without independent
investigation, the genuineness of all signatures, the legal capacity of all
individuals who have executed any of the aforesaid documents, the authenticity
of all documents submitted to us as originals, the conformity to original
documents of all documents submitted to us as certified or photostatic copies
(and the authenticity of the originals of such copies), and that all public
records
<PAGE>
reviewed are accurate and complete. We have further assumed that the Purchase
Agreement and the Indenture have been duly executed and delivered by all the
parties thereto other than the Trust. As to various facts material to the
opinions set forth herein (including, without limitation, the number of shares
of capital stock outstanding, the receipt of consideration therefor, the
execution of documents on behalf of the Trust and the absence of any violation
by the Trust of any applicable Maryland law), we have relied without independent
verification upon certificates of public officials and upon facts certified to
us by officers of the Trust as contained in a certificate of such officers (the
"Officers' Certificate"). Capitalized terms used but not defined herein shall
have the meanings specified in the Purchase Agreement.
Based upon the foregoing, having regard for such legal
considerations as we deem relevant, we are of the opinion and advise you as
follows:
1. The Trust has been duly organized and is validly existing and in
good standing as a real estate investment trust under the laws of the State of
Maryland.
2. The Exchange Notes have been duly authorized for execution,
authentication and delivery in exchange for the Initial Notes as described in
the Registration Statement.
The foregoing opinions are limited to the laws of the State of
Maryland, exclusive of securities or "blue sky" laws. We assume no obligation to
supplement this opinion if any applicable laws change after the date hereof or
if we become aware of any facts that might change the opinions expressed herein
after the date hereof. We hereby consent to the filing of this opinion as
Exhibit 5 to the Registration Statement and to the reference to our firm in the
Registration Statement.
Very truly yours,
/s/ PIPER & MARBURY L.L.P
PIPER & MARBURY L.L.P.
Exhibit 8
SULLIVAN & WORCESTER LLP
One Post Office Square
Boston, Massachusetts 02109
March 11, 1998
Health and Retirement Properties Trust
400 Centre Street
Newton, Massachusetts 02158
Ladies and Gentlemen:
In connection with the registration by Health and Retirement Properties
Trust, a Maryland real estate investment trust (the "Company"), of $150,000,000
in principal amount of its 6 3/4% Senior Notes Due 2002, the following opinion
is furnished to you to be filed with the Securities and Exchange Commission (the
"SEC") as Exhibit 8 to the Company's Registration Statement on Form S-4, under
the Securities Act of 1933, as amended (the "Act"), to be filed on or about the
date hereof (the "Registration Statement").
We have acted as counsel for the Company in connection with the
preparation of the Registration Statement, and we have examined originals or
copies, certified or otherwise identified to our satisfaction, of corporate
records, certificates and statements of officers and accountants of the Company
and of public officials, and such other documents as we have considered relevant
and necessary in order to furnish the opinion hereinafter set forth.
Specifically, and without limiting the generality of the foregoing, we have
reviewed: (i) the declaration of trust, as amended and restated, and the by-laws
of the Company; (ii) the Registration Statement; and (iii) the "Prospectus"
relating to the Registration Statement. We have also reviewed the sections in
the Company's Annual Report on Form 10-K for the year ended December 31, 1997,
filed under the Securities Exchange Act of 1934 (the "Form 10-K") captioned
"Federal Income Tax Considerations" and "ERISA Plans, Keogh Plans and Individual
Retirement Accounts," as supplemented by the statements in the Prospectus under
the captions "Prospectus Summary -- Summary of the Terms of the Exchange Offer
- -- Certain Federal Income Tax Considerations" and "Certain Federal Income Tax
Considerations." With respect to all questions of fact on which such opinions
are based, we have assumed the accuracy and completeness of and have relied on
the information set forth in the Prospectus and in the documents incorporated
therein by reference, and on representations made to us by the officers of the
Company. We have not independently verified such information; nothing
<PAGE>
Health and Retirement Properties Trust
March 11, 1998
Page 2
has come to our attention, however, which would lead us to believe that we are
not entitled to rely on such information.
The opinion set forth below is based upon the Internal Revenue Code of
1986, as amended, the Treasury Regulations issued thereunder, published
administrative interpretations thereof, and judicial decisions with respect
thereto, all as of the date hereof (collectively the "Tax Laws"), and upon the
Employee Retirement Income Security Act of 1974, as amended, the Department of
Labor regulations issued thereunder, published administrative interpretations
thereof, and judicial decisions with respect thereto, all as of the date hereof
(collectively, the "ERISA Laws"). No assurance can be given that the Tax Laws or
the ERISA Laws will not change. In preparing the discussions with respect to the
matters in the sections of the Form 10-K captioned "Federal Income Tax
Considerations" and "ERISA Plans, Keogh Plans and Individual Retirement
Accounts," as supplemented by the statements in the Prospectus under the
captions "Prospectus Summary -- Summary of the Terms of the Exchange Offer --
Certain Federal Income Tax Considerations" and "Certain Federal Income Tax
Considerations," we have made certain assumptions and expressed certain
conditions and qualifications therein, all of which assumptions, conditions and
qualifications are incorporated herein by reference.
Based upon and subject to the foregoing, we are of the opinion that the
discussions in the sections of the Form 10-K captioned "Federal Income Tax
Considerations" and "ERISA Plans, Keogh Plans and Individual Retirement
Accounts," as supplemented by the statements in the Prospectus under the
captions "Prospectus Summary -- Summary of the Terms of the Exchange Offer --
Certain Federal Income Tax Considerations" and "Certain Federal Income Tax
Considerations," in all material respects are accurate and fairly summarize the
Tax Laws issues and ERISA Laws issues addressed therein, and hereby confirm that
the opinions of counsel referred to in said sections represent our opinions on
the subject matter thereof.
We hereby consent to the incorporation of this opinion by reference as
an exhibit to the Registration Statement and to the reference to our firm in the
Prospectus. In giving such consent, we do not thereby admit that we come within
the category of persons whose consent is required under Section 7 of the Act or
under the rules and regulations of the SEC promulgated thereunder.
Very truly yours,
/s/ Sullivan & Worcester LLP
SULLIVAN & WORCESTER LLP
Exhibit 23.1
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-4) and related Prospectus of Health and
Retirement Properties Trust for the registration of $150,000,000 Senior Notes
due December 18, 2002 and to the incorporation by reference therein of our
report dated February 9, 1998, with respect to the consolidated financial
statements incorporated by reference in its Annual Report (Form 10-K) for the
year ended December 31, 1997 and the related financial statement schedules
included therein, filed with the Securities and Exchange Commission.
/s/ ERNST & YOUNG LLP
Boston, Massachusetts ERNST & YOUNG LLP
March 9, 1998
Exhibit 23.2
Consent of Independent Public Accountants
As independent public accountants, we hereby consent to the
incorporation by reference in this registration statement of our report dated
January 16, 1998 on Hospitality Properties Trust included in Health and
Retirement Properties Trust's Form 8-K dated February 27, 1998 and Form 10-K for
the year ended December 31, 1997 and to all references to our firm included in
this registration statement.
Washington, D.C. /s/ Arthur Andersen LLP
March 5, 1998
Exhibit 23.3
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in Health and Retirement Properties Trust's registration statement on
Form S-4 of our report dated February 3, 1998 included in Marriott
International, Inc.'s Form 10-K for the fiscal year ended January 2, 1998 (File
No. 1-12188) and to all references to our Firm included in this registration
Statement.
Washington, D.C. /s/ Arthur Andersen LLP
March 5, 1998
EXHIBIT 25.1
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) __
STATE STREET BANK AND TRUST COMPANY
(Exact name of trustee as specified in its charter)
Massachusetts 04-1867445
(Jurisdiction of incorporation or (I.R.S. Employer
organization if not a U.S. national bank) Identification No.)
225 Franklin Street, Boston, Massachusetts 02110
(Address of principal executive offices) (Zip Code)
John R. Towers, Esq. Executive Vice President and General Counsel
225 Franklin Street, Boston, Massachusetts 02110
(617) 654-3253
(Name, address and telephone number of agent for service)
HEALTH AND RETIREMENT PROPERTIES TRUST
(Exact name of obligor as specified in its charter)
MARYLAND (04-6558834)
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
400 Centre Street
Newton, MA 02158
(617)332-3990
(Address of principal executive offices) (Zip Code)
6 3/4% SENIOR NOTES DUE 2002
(Title of indenture securities)
<PAGE>
GENERAL
Item 1. General Information.
Furnish the following information as to the trustee:
(a) Name and address of each examining or supervisory authority to which it
is subject.
Department of Banking and Insurance of The Commonwealth of
Massachusetts, 100 Cambridge Street, Boston, Massachusetts.
Board of Governors of the Federal Reserve System, Washington,
D.C., Federal Deposit Insurance Corporation, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
Trustee is authorized to exercise corporate trust powers.
Item 2. Affiliations with Obligor.
If the Obligor is an affiliate of the trustee, describe each such
affiliation.
The obligor is not an affiliate of the trustee or of its
parent, State Street Corporation.
(See note on page 2.)
Item 3. through Item 15. Not applicable.
Item 16. List of Exhibits.
List below all exhibits filed as part of this statement of eligibility.
1. A copy of the articles of association of the trustee as now in
effect.
A copy of the Articles of Association of the trustee, as now
in effect, is on file with the Securities and Exchange
Commission as Exhibit 1 to Amendment No. 1 to the Statement of
Eligibility and Qualification of Trustee (Form T-1) filed with
the Registration Statement of Morse Shoe, Inc. (File No.
22-17940) and is incorporated herein by reference thereto.
2. A copy of the certificate of authority of the trustee to commence
business, if not contained in the articles of association.
A copy of a Statement from the Commissioner of Banks of
Massachusetts that no certificate of authorityfor the trustee
to commence business was necessary or issued is on file with
the Securities and Exchange Commission as Exhibit 2 to
Amendment No. 1 to the Statement of Eligibility and
Qualification of Trustee (Form T-1) filed with the
Registration Statement of Morse Shoe, Inc. (File No. 22-17940)
and is incorporated herein by reference thereto.
3. A copy of the authorization of the trustee to exercise corporate
trust powers, if such authorization is not contained in the documents
specified in paragraph (1) or (2), above.
A copy of the authorization of the trustee to exercise
corporate trust powers is on file with the Securities and
Exchange Commission as Exhibit 3 to Amendment No. 1 to the
Statement of Eligibility and Qualification of Trustee (Form
T-1) filed with the Registration Statement of Morse Shoe, Inc.
(File No. 22-17940) and is incorporated herein by reference
thereto.
4. A copy of the existing by-laws of the trustee, or instruments
corresponding thereto.
A copy of the by-laws of the trustee, as now in effect, is on
file with the Securities and Exchange Commission as Exhibit 4
to the Statement of Eligibility and Qualification of Trustee
(Form T- 1) filed with the Registration Statement of Eastern
Edison Company (File No. 33-37823) and is incorporated herein
by reference thereto.
<PAGE>
5. A copy of each indenture referred to in Item 4. if the obligor is in
default.
Not applicable.
6. The consents of United States institutional trustees required by
Section 321(b) of the Act.
The consent of the trustee required by Section 321(b) of the
Act is annexed hereto as Exhibit 6 and made a part hereof.
7. A copy of the latest report of condition of the trustee published
pursuant to law or the requirements of its supervising or examining authority.
A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority is annexed hereto as
Exhibit 7 and made a part hereof.
NOTES
In answering any item of this Statement of Eligibility which relates to
matters peculiarly within the knowledge of the obligor or any underwriter for
the obligor, the trustee has relied upon information furnished to it by the
obligor and the underwriters, and the trustee disclaims responsibility for the
accuracy or completeness of such information.
The answer furnished to Item 2. of this statement will be amended, if
necessary, to reflect any facts which differ from those stated and which would
have been required to be stated if known at the date hereof.
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939, as
amended, the trustee, State Street Bank and Trust Company, a corporation
organized and existing under the laws of The Commonwealth of Massachusetts, has
duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in the City of Boston and The
Commonwealth of Massachusetts, on the 10th day of March, 1998.
STATE STREET BANK AND TRUST COMPANY
By: /s/ James E. Mogavero
James E. Mogavero
Vice President
2
<PAGE>
EXHIBIT 6
CONSENT OF THE TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939, as amended, in connection with the proposed issuance by Health and
Retirement Properties Trust, of its 6 3/4% Senior Notes due 2002, we hereby
consent that reports of examination by Federal, State, Territorial or District
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon request therefor.
STATE STREET BANK AND TRUST COMPANY
By: /s/ James E. Mogavero
James E. Mogavero
Vice President
Dated: March 10, 1998
3
<PAGE>
EXHIBIT 7
Consolidated Report of Condition of State Street Bank and Trust Company,
Massachusetts and foreign and domestic subsidiaries, a state banking institution
organized and operating under the banking laws of this commonwealth and a member
of the Federal Reserve System, at the close of business September 30, 1997,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act and in accordance
with a call made by the Commissioner of Banks under General Laws, Chapter 172,
Section 22(a).
<TABLE>
<CAPTION>
Thousands of
Dollars
------------
<S> <C>
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin 1,380,475
Interest-bearing balances 8,821,855
Securities 10,461,989
Federal funds sold and securities purchased
under agreements to resell in domestic offices
of the bank and its Edge subsidiary 6,085,138
Loans and lease financing receivables:
Loans and leases, net of unearned income 5,597,831
Allowance for loan and lease losses 79,416
Allocated transfer risk reserve 0
Loans and leases, net of unearned income and allowances 5,518,415
Assets held in trading accounts 917,895
Premises and fixed assets 390,028
Other real estate owned 779
Investments in unconsolidated subsidiaries 34,278
Customers' liability to this bank on acceptances outstanding 83,470
Intangible assets 227,659
Other assets 1,969,514
-----------
Total assets 35,891,495
===========
LIABILITIES
Deposits:
In domestic offices 8,095,559
Noninterest-bearing 5,962,025
Interest-bearing 2,133,534
In foreign offices and Edge subsidiary 14,399,173
Noninterest-bearing 86,798
Interest-bearing 14,312,375
Federal funds purchased and securities sold under
agreements to repurchase in domestic offices of
the bank and of its Edge subsidiary 7,660,881
Demand notes issued to the US Treasury and Trading Liabilities 1,107,552
Other borrowed money 589,733
Subordinated notes and debentures 0
Bank's liability on acceptances executed and outstanding 85,600
Other liabilities 1,830,593
Total liabilities 33,769,091
-----------
EQUITY CAPITAL
Perpetual preferred stock and related surplus 0
Common stock 29,931
Surplus 437,183
Undivided profits and capital reserves/Net unrealized holding gains (losses) 1,660,158
Cumulative foreign currency translation adjustments (4,868)
-----------
Total equity capital 2,122,404
-----------
Total liabilities and equity capital 35,891,495
</TABLE>
4
<PAGE>
I, Rex S. Schuette, 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.
Rex S. Schuette
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.
David A. Spina
Marshall N. Carter
Truman S. Casner
5
Exhibit 99.1
HEALTH AND RETIREMENT PROPERTIES TRUST
FORM OF LETTER OF TRANSMITTAL
6 3/4% SENIOR NOTES DUE 2002
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME,
ON _________, 1998 UNLESS EXTENDED (THE "EXPIRATION DATE").
The Exchange Agent is:
STATE STREET BANK AND TRUST COMPANY
By Registered or Certified Mail: By Hand or Overnight Delivery:
State Street Bank and Trust Company State Street Bank and Trust Company
Corporate Trust Department Corporate Trust Department
Two International Place Two International Place
Boston, Massachusetts 02110 Boston, Massachusetts 02110
Attention: Sandy Wong Attention: Sandy Wong
By Facsimile for Eligible
Institutions:
(617) 664-5290
For confirmation and/or
information call:
(617) 664-5590
Delivery of this instrument to an address other than as set forth above
or transmission of instructions via a facsimile number other than the one listed
above will not constitute a valid delivery. The instructions accompanying this
Letter of Transmittal should be read carefully before this Letter of Transmittal
is completed.
The undersigned acknowledges that he or she has received the Prospectus
dated __________, 1998 (the "Prospectus") of Health and Retirement Properties
Trust (the "Company") and this Letter of Transmittal (the "Letter of
Transmittal"), which together constitute the Company's offer (the "Exchange
Offer") to exchange $100,000 principal amount (or integral multiples of $1,000
in excess thereof) of its 6 3/4% Senior Notes due 2002 (the "New Notes"), which
have been registered under the Securities Act of 1933, as amended (the
"Securities Act"), pursuant to a Registration Statement of which the Prospectus
is a part, for each $100,000 principal amount (or integral multiples of $1,000
in excess thereof) of its outstanding 6 3/4% Senior Notes due 2002 (the "Old
Notes"), of which $150,000,000 aggregate principal amount is outstanding. Other
capitalized terms used but not defined herein have the meaning given to them in
the Prospectus.
The Letter of Transmittal is to be used by Holders of Old Notes (i) if
the Old Notes are to be physically delivered herewith; (ii) if delivery of the
Old Notes is made by book-entry transfer to the Exchange Agent's account at the
Depositary Trust Company ("DTC") pursuant to the procedures set forth in the
Prospectus under "The Exchange Offer--Procedures for Tendering" by any financial
institution that is a participant in DTC and whose name appears on a security
position listing as the owner of the Old Notes (unless an Agent's Message (as
defined in the Prospectus) is transmitted to and received by the Exchange Agent
on or prior to the Expiration Date at one of its addresses set forth above) or
(iii) if the guaranteed delivery procedures described in the Prospectus are to
be utilized.
DELIVERY OF DOCUMENTS TO DTC DOES NOT CONSTITUTE DELIVERY TO THE EXCHANGE
AGENT.
<PAGE>
The term "Holder" with respect to the Exchange Offer means any person
(i) in whose name Old Notes are registered on the books of the Company or any
other person who has obtained a properly completed bond power from the
registered holder or (ii) in whose name the Old Notes are held of record by DTC
who desires to deliver such Old Notes by book-entry transfer at DTC. The
undersigned has completed, executed and delivered this Letter of Transmittal to
indicate the action the undersigned desires to take with respect to the Exchange
Offer. Holders who wish to tender their Old Notes must complete this letter in
its entirety.
Holders who desire to tender their Old Notes and whose Old Notes are
not lost but are not immediately available or who cannot deliver their Old Notes
and all other documents required hereby to the Exchange Agent by the Expiration
Date or who are unable to complete the procedure for book-entry transfer on a
timely basis must tender their Old Notes pursuant to the guaranteed delivery
procedure set forth in "The Exchange Offer--Procedures for Tendering."
2
<PAGE>
PLEASE READ THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
CAREFULLY BEFORE CHECKING ANY BOX BELOW.
DESCRIPTION OF 6 3/4% SENIOR NOTES DUE 2002 (OLD NOTES)
<TABLE>
<CAPTION>
Principal Amount
Tendered (must be in
denominations of
Name(s) and $100,000 or any
Address(es) of Aggregate Principal integral multiples of
Registered Holder(s) Certificate Amount Represented $1,000 in excess
(Please fill in, if blank) Number(s)* by Certificate(s) thereof)**
<S> <C> <C> <C>
____________________________ _____________ ___________________ ____________________
____________________________ _____________ ___________________ ____________________
____________________________ _____________ ___________________ ____________________
____________________________ _____________ ___________________ ____________________
Total
<FN>
* Need not be completed by holders of Old Notes who tender by book-entry transfer.
** Need not be completed by holders who wish to tender with respect to all Old Notes listed.
</FN>
</TABLE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
|_| CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT WITH DTC
AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:__________________________________________________
DTC Book-Entry Account Number:__________________________________________________
Transaction Code No:____________________________________________________________
|_| CHECK HERE IF TENDERED OLD NOTES ARE BEING DELIVERED PURSUANT TO A
NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND
COMPLETE THE FOLLOWING:
Name(s) of Registered Holder(s):________________________________________________
Date of Execution of Notice of Guaranteed Delivery:_____________________________
Name of Institution which Guaranteed Delivery:_________________________________
DTC Account Number:_____________________________________________________________
If Delivered by Book-Entry Transfer:
Name of Tendering Institution:________________________________________________
DTC Book-Entry Account No.:___________________________________________________
Transaction Code No.:_________________________________________________________
3
<PAGE>
|_| CHECK HERE IF YOU ARE A BROKER-DEALER TENDERING OLD NOTES ACQUIRED AND
WISH TO RECEIVE 10 ADDITIONAL COPIES OF THE PROSPECTUS AND 10 COPIES OF
ANY AMENDMENTS OR SUPPLEMENTS THERETO.
Name:__________________________________________________________________
Address:_______________________________________________________________
_______________________________________________________________
4
<PAGE>
To: State Street Bank and Trust Company
Ladies and Gentlemen:
Subject to the terms and conditions of the Exchange Offer, the
undersigned hereby tenders to the Company the principal amount of Old Notes
indicated above. Subject to and effective upon the acceptance for exchange of
the principal amount of Old Notes tendered in accordance with this Letter of
Transmittal, the undersigned sells, assigns and transfers to, or upon the order
of, the Company all right, title and interest in and to the Old Notes tendered
hereby. The undersigned hereby irrevocably constitutes and appoints the Exchange
Agent its agent and attorney-in-fact (with full knowledge that the Exchange
Agent also acts as the agent of the Company) with respect to the tendered Old
Notes with full power of substitution to (i) deliver such Old Notes to the
Company or transfer ownership of such Old Notes on the account books maintained
by DTC, in each case, together with all accompanying evidences of transfer and
authenticity to, or upon the order of, the Company, (ii) present such Old Notes
or transfer ownership of such Old Notes on the account books maintained by DTC,
for transfer on the books of the Company and (iii) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Old Notes, all in
accordance with the terms of the Exchange Offer. The power of attorney granted
in this paragraph shall be deemed irrevocable and coupled with an interest.
The undersigned hereby represents and warrants that he or she has full
power and authority to tender, sell, assign and transfer the Old Notes tendered
hereby and that the Company will acquire good and unencumbered title thereto,
free and clear of all liens, restrictions, charges and encumbrances and not
subject to any adverse claim, when the same are acquired by the Company. The
undersigned hereby acknowledges that this Exchange Offer is being made in
reliance upon an interpretation by the staff of the Securities and Exchange
Commission that any New Notes acquired in exchange for Old Notes tendered hereby
may be offered for sale, resold and otherwise transferred by holders thereof
(other than any such Holder that is an "affiliate" of the Company or any of its
subsidiaries within the meaning of Rule 405 under the Securities Act of 1933
(the "Securities Act")), without compliance with the registration and prospectus
delivery provisions of the Securities Act, provided that such New Notes are
acquired in the ordinary course of business of the Holder receiving such New
Notes and that neither the Holder nor any such other person has an arrangement
with any person to participate in the distribution of such New Notes. The
undersigned hereby further represents that (i) the New Notes acquired pursuant
to the Exchange Offer are being obtained in the ordinary course of such Holder's
business, (ii) such Holder has no arrangements with any person to participate in
the distribution (within the meaning of the Securities Act) of such New Notes
and (iii) such Holder is not an "affiliate," as defined under Rule 405 of the
Securities Act of the Company or any of its subsidiaries or, if such Holder is
an affiliate, that such Holder will comply with the registration and prospectus
delivery requirements of the Securities Act to the extent applicable. If the
undersigned is not a broker-dealer, the undersigned represents that it is not
engaged in, and does not intend to engage in, a distribution of New Notes. If
the undersigned is a broker-dealer that will receive New Notes for its own
account in exchange for Old Notes, it represents that the Old Notes to be
exchanged for the New Notes were acquired by it as a result of market-making
activities or other trading activities and acknowledges that it will deliver a
prospectus in connection with any resale of such New Notes; however, by so
acknowledging and by delivering a prospectus, the undersigned will not be deemed
to admit that it is an "underwriter" within the meaning of the Securities Act.
The undersigned will, upon request, execute and deliver any additional documents
deemed by the Exchange Agent or the Company to be necessary or desirable to
complete the assignment, transfer and purchase of the Old Notes tendered hereby.
For purposes of the Exchange Offer, the Company shall be deemed to have
accepted validly tendered Old Notes, when, as and if the Company has given oral
or written notice of acceptance thereof to the Exchange Agent.
If any tendered Old Notes are not accepted for exchange pursuant to the
Exchange Offer for any reason, any such unaccepted Old Notes will be returned
(except as noted below with respect to tenders through DTC), without expense, to
the undersigned at the address shown below or at a different address as may be
indicated herein under "Special Payment Instructions" as promptly as practicable
after the Expiration Date.
5
<PAGE>
All authority herein conferred or agreed to be conferred in this Letter
of Transmittal shall survive the death, incapacity or dissolution of the
undersigned, and any obligation of the undersigned hereunder shall be binding
upon the administrators, legal representatives, heirs, personal representatives,
successors and assigns of the undersigned.
The undersigned understands that tenders of Old Notes pursuant to the
procedures described under the caption "The Exchange Offer--Procedures for
Tendering" in the Prospectus and in the instructions hereto will constitute a
binding agreement between the undersigned and the Company upon the terms and
subject to the conditions of the Exchange Offer.
Unless otherwise indicated under "Special Payment Instructions," please
issue the New Notes issued in exchange for the Old Notes accepted for exchange
and return any Old Notes not tendered or not exchanged in the name(s) of the
undersigned (or, in either such event, in the case of Old Notes tendered by DTC,
by credit to the account at DTC). Similarly, unless otherwise indicated under
"Special Delivery Instructions," please send the New Notes issued in exchange
for the Old Notes accepted for exchange and any Old Notes not tendered or not
exchanged (and accompanying documents, as appropriate) to the undersigned at the
address shown below the undersigned's signature(s), unless, in either event,
tender is being made through DTC. In the event that both "Special Payment
Instructions" and "Special Delivery Instructions" are completed, please issue
the New Notes issued in exchange for the Old Notes accepted for exchange and
return any Old Notes not tendered or not exchanged in the name(s) of, and send
said New Notes to, the person(s) so indicated. The undersigned recognizes that
the Company has no obligation pursuant to the "Special Payment Instructions" and
"Special Delivery Instructions" to transfer any Old Notes from the name of the
registered holder(s) thereof if the Company does not accept for exchange any of
the Old Notes so tendered.
Holders of the Old Notes who wish to tender their Old Notes and (i)
whose Old Notes are not immediately available or (ii) who cannot deliver their
Old Notes, this Letter of Transmittal or any other documents required hereby to
the Exchange Agent prior to the Expiration Date, may tender their Old Notes
according to the guaranteed delivery procedures set forth in the Prospectus
under the caption "The Exchange Offer--Guaranteed Delivery Procedures." See
Instruction 1 regarding the completion of the Letter of Transmittal printed
below.
SPECIAL PAYMENT INSTRUCTIONS
(See Instructions 3, 4 and 5)
To be completed ONLY if certificates for Old Notes in a principal amount not
tendered or not purchased, or New Notes issued in exchange for Old Notes
accepted for exchange, are to be issued in the name of someone other than the
undersigned.
Issue New Notes to:
Name:___________________________________________________________________________
(Please Print)
Address:________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
________________________________________________________________________________
(Tax Identification or Social Security No.)
SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 3, 4 and 5)
To be completed ONLY if certificates for Old Notes in a principal amount not
tendered or not purchased, or New Notes issued in exchange for Old Notes
accepted for exchange are to be sent to someone other than the undersigned, or
the undersigned at an address other than that shown above.
Mail to:
Name:___________________________________________________________________________
(Please Print)
Address:________________________________________________________________________
________________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
________________________________________________________________________________
(Tax Identification or Social Security No.)
6
<PAGE>
PLEASE SIGN HERE
WHETHER OR NOT OLD NOTES ARE BEING PHYSICALLY TENDERED HEREBY
________________________________ Dated: ________________________________________
________________________________ Dated: ________________________________________
Signature(s) of Registered Holder(s) or Authorized Signatory
Area Code and Telephone Number: ________________________________________________
The above lines must be signed by the registered holder(s) of Old Notes
as their name(s) appear(s) on the Old Notes or, if tendered by a participant in
DTC, exactly as such participant's name appears on a security position listing
as the owner of the Old Notes or by person(s) authorized to become registered
holder(s) by properly executed bond power and other documents transmitted with
this Letter of Transmittal. If Old Notes to which this Letter of Transmittal
relates are held of record by two or more joint holders, then all such holders
must sign this Letter of Transmittal. If signature is by a trustee, executor,
administrator, guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, such person must (i)
set forth his or her full title below and (ii) unless waived by the Company,
submit evidence satisfactory to the Company of such person's authority so to
act. See Instruction 3 regarding the completion of this Letter of Transmittal
printed below.
If the signature appearing above is not the registered Holder(s) of the
Old Notes, then the registered Holder must sign a valid proxy.
Name(s):________________________________________________________________________
________________________________________________________________________________
(Please Print)
Capacity (full title):__________________________________________________________
Address:________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
GUARANTEE OF SIGNATURE(S)
(If required - See Instruction 3)
Authorized Signature:___________________________________________________________
Name:___________________________________________________________________________
(Please Print)
Name of Firm:___________________________________________________________________
Address:________________________________________________________________________
________________________________________________________________________________
(Include Zip Code)
Title:__________________________________________________________________________
Area Code and Telephone No.:____________________________________________________
Dated:__________________________________________________________________________
7
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS
OF THE EXCHANGE OFFER
1. Delivery of this Letter of Transmittal and Old Notes. The tendered
Old Notes (or a confirmation of a book-entry transfer into the Exchange Agent's
account at DTC of all Old Notes delivered electronically), as well as a properly
completed and duly executed copy of this Letter of Transmittal or facsimile
hereof and any other documents required by this Letter of Transmittal, must be
received by the Exchange Agent at its address set forth herein prior to 5:00
p.m., New York City time, on the Expiration Date. The method of delivery of the
tendered Old Notes, this Letter of Transmittal and all other required documents
to the Exchange Agent is at the election and risk of the Holder and, except as
otherwise provided below, the delivery will be deemed made only when actually
received by the Exchange Agent. Instead of delivery by mail, it is recommended
that the Holder use an overnight or hand delivery service. In all cases,
sufficient time should be allowed to assure timely delivery. No Letter of
Transmittal or Old Notes should be sent to the Company.
Holders who wish to tender their Old Notes and (i) whose Old Notes are
not immediately available, or (ii) who cannot deliver their Old Notes, this
Letter of Transmittal or any other documents required hereby to the Exchange
Agent prior to 5:00 p.m., New York City time, on the Expiration Date, must
tender their Old Notes according to the guaranteed delivery procedures set forth
in the Prospectus. Pursuant to such procedures: (i) such tender must be made by
or through a member firm of a registered national securities exchange or of the
National Association of Securities Dealers, Inc., or a commercial bank or trust
company having an office or correspondent in the United States or an "eligible
guarantor institution" (an "Eligible Institution") within the meaning of Rule
17Ad-15 under the Securities Exchange Act of 1934, as amended; (ii) prior to the
Expiration Date, the Exchange Agent must have received from the Eligible
Institution a properly completed and duly executed Notice of Guaranteed Delivery
(by facsimile transmission, mail or hand delivery) setting forth the name and
address of the Holder of the Old Notes, the certificate number or numbers of
such Old Notes and the principal amount of Old Notes tendered, stating that the
tender is being made thereby and guaranteeing that, within three business days
after the Expiration Date, this Letter of Transmittal (or facsimile hereof)
together with the Old Notes (or a confirmation of electronic delivery of
book-entry delivery into the Exchange Agent's account at DTC) and any other
required documents will be deposited by the Eligible Institution with the
Exchange Agent; and (iii) such properly completed and executed Letter of
Transmittal (or facsimile hereof), as well as all other documents required by
this Letter of Transmittal and all tendered Old Notes in proper form for
transfer (or a confirmation of electronic delivery of book-entry delivery into
the Exchange Agent's account at DTC), must be received by the Exchange Agent
within three business days after the Expiration Date, all as provided in the
Prospectus under the caption "The Exchange Offer -- Guaranteed Delivery
Procedures." Any Holder of Old Notes who wishes to tender his or her Old Notes
pursuant to the guaranteed delivery procedures described above must ensure that
the Exchange Agent receives the Notice of Guaranteed Delivery prior to 5:00
p.m., New York City time, on the Expiration Date. Upon request of the Exchange
Agent, a Notice of Guaranteed Delivery will be sent to Holders who wish to
tender their Old Notes according to the guaranteed delivery procedures set forth
above.
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance of tendered Old Notes and withdrawal of tendered Old
Notes will be determined by the Company in its sole discretion, which
determination will be final and binding. The Company reserves the absolute right
to reject any and all Old Notes not properly tendered or any Old Notes the
Company's acceptance of which would, in the opinion of counsel for the Company,
be unlawful. The Company also reserves the right to waive any defects or
irregularities or conditions of tender as to the Exchange Offer and/or
particular Old Notes. The Company's interpretation of the terms and conditions
of the Exchange Offer (including the instructions in this Letter of Transmittal)
shall be final and binding on all parties. Unless waived, any defects or
irregularities in connection with tenders of Old Notes must be cured within such
time as the Company shall determine. Neither the Company, the Exchange Agent nor
any other person shall be under any duty to give notification of defects or
irregularities with respect to tenders of Old Notes, nor shall any of them incur
any liability for failure to give such notification. Tenders of Old Notes will
not be deemed to have been made until such defects or irregularities have been
cured or waived. Any Old Notes received by the
8
<PAGE>
Exchange Agent that are not validly tendered and as to which the defects or
irregularities have not been cured or waived will be returned by the Exchange
Agent to the tendering Holders of Old Notes, unless otherwise provided in this
Letter of Transmittal, as soon as practicable following the Expiration Date.
2. Partial Tenders. Tenders of Old Notes will be accepted only in
denominations of $100,000 and any integral multiples of $1,000 in excess
thereof. If less than the entire principal amount of any Old Notes is tendered,
the tendering Holder should fill in the principal amount tendered in the fourth
column of the box entitled "Description of 6 3/4% Senior Notes Due 2002 (Old
Notes)" above. The entire principal amount of Old Notes delivered to the
Exchange Agent will be deemed to have been tendered unless otherwise indicated.
If the entire principal amount of all Old Notes is not tendered, then Old Notes
for the principal amount of Old Notes not tendered and the New Notes issued in
exchange for any Old Notes accepted will be sent to the Holder at his or her
registered address, unless a different address is provided in the appropriate
box on this Letter of Transmittal, promptly after the Old Notes are accepted for
exchange.
3. Signatures on the Letter of Transmittal; Bond Powers and
Endorsements; Guarantee of Signatures. If this Letter of Transmittal (or
facsimile hereof) is signed by the record Holder(s) of the Old Notes tendered
hereby, the signature must correspond with the name(s) as written on the face of
the Old Notes without alteration, enlargement or any change whatsoever.
If this Letter of Transmittal (or facsimile hereof) is signed by the
registered Holder or Holders of Old Notes tendered and the New Notes issued in
exchange therefor are to be issued (or any untendered principal amount of Old
Notes is to be reissued) to the registered Holder, the said Holder need not and
should not endorse any tendered Old Notes, nor provide a separate bond power.
If this Letter of Transmittal (or facsimile hereof) is signed by a
person other than the registered Holder or Holders of any Old Notes listed, such
Old Notes must be endorsed or accompanied by appropriate bond powers signed as
the name of the registered Holder or Holders appears on the Old Notes.
If this Letter of Transmittal (or facsimile hereof) or any Old Notes or
bond powers are signed by trustees, executors, administrators, guardians,
attorneys-in-fact or officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing, and,
unless waived by the Company, evidence satisfactory to the Company of their
authority so to act must be submitted with this Letter of Transmittal.
Endorsements on Old Notes or signatures on bond powers required by this
Instruction 3 must be guaranteed by an Eligible Institution participating in a
recognized medallion signature guarantee program.
Except as otherwise provided below, all signatures on this Letter of
Transmittal (or facsimile hereof) must be guaranteed by an Eligible Institution
participating in a recognized medallion signature guarantee program. Signatures
on this Letter of Transmittal need not be guaranteed if (i) this Letter of
Transmittal is signed by the registered Holder(s) of the Old Notes tendered
herewith (including any participant in DTC whose name appears on a security
position listing as the owner of Old Notes) and such Holder(s) have not
completed the box set forth herein entitled "Special Payments Instructions" or
the box entitled "Special Delivery Instructions" or (ii) such Old Notes are
tendered for the account of an Eligible Institution.
4. Special Issuance and Delivery Instructions. Tendering Holders should
indicate, in the applicable box or boxes, the name and address to which New
Notes or substitute Old Notes for principal amounts not tendered or not accepted
for exchange are to be issued or sent, if different from the name and address of
the person signing this Letter of Transmittal (or in the case of tender of the
Old Notes through DTC, if different from DTC). In the case of issuance in a
different name, the taxpayer identification or social security number of the
person named must also be indicated.
5. Tax Identification Number. Federal income tax law requires that a
Holder whose offered Old Notes are accepted for exchange must provide the
Company (as payor) with his, her or its correct Taxpayer Identification
9
<PAGE>
Number ("TIN"), which, in the case of an exchanging Holder who is an individual,
is his or her social security number. If the Company is not provided with the
correct TIN or an adequate basis for exemption, such Holder may be subject to a
$50 penalty imposed by the Internal Revenue Service (the "IRS"). In addition,
delivery to such Holder of New Notes may be subject to backup withholding in an
amount equal to 31% of the gross proceeds resulting from the Exchange Offer. If
withholding results in an overpayment of taxes, a refund may be obtained. Exempt
Holders (including, among others, all corporations and certain foreign
individuals) are not subject to these backup withholding and reporting
requirements.
To prevent backup withholding, each exchanging Holder must provide his,
her or its correct TIN by completing the Substitute Form W-9 enclosed herewith,
certifying that the TIN provided is correct (or that such Holder is awaiting a
TIN) and that either (i) the Holder is exempt from backup withholding, (ii) the
Holder has not been notified by the IRS that he, she or it is subject to backup
withholding as a result of a failure to report all interest or dividends, or
(iii) the IRS has notified the Holder that he, she or it is no longer subject to
backup withholding. In order to satisfy the Exchange Agent that a foreign
individual qualifies as an exempt recipient, such Holder must submit a statement
signed under penalty of perjury attesting to such exempt status. Such statements
may be obtained from the Exchange Agent. If the Old Notes are in more than one
name or are not in the name of the actual owner, consult the Substitute Form W-9
for information on which TIN to report. If you do not provide your TIN to the
Company within 60 days, backup withholding will begin and continue until you
furnish your TIN to the Company.
6. Transfer Taxes. The Company will pay all transfer taxes, if any,
applicable to the exchange of Old Notes pursuant to the Exchange Offer. If,
however, New Notes or Old Notes for principal amounts not tendered or accepted
for exchange are to be delivered to, or are to be registered or issued in the
name of, any person other than the registered Holder of the Old Notes tendered
hereby, or if tendered Old Notes are registered in the name of any person other
than the person signing this Letter of Transmittal, or if a transfer tax is
imposed for any reason other than the exchange of Old Notes pursuant to the
Exchange Offer, then the amount of any such transfer taxes (whether imposed on
the registered Holder or on any other person) will be payable by the tendering
Holder.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the Old Notes listed in this Letter of
Transmittal.
7. Waiver of Conditions. The Company reserves the absolute right to
amend, waive or modify specified conditions in the Exchange Offer in the case of
any Old Notes tendered.
8. Mutilated, Lost Stolen or Destroyed Old Notes. Any tendering Holder
whose Old Notes have been mutilated, lost, stolen or destroyed should contact
the Exchange Agent at the address indicated herein for further instructions.
9. Requests for Assistance or Additional Copies. Questions and requests
for assistance and requests for additional copies of the Prospectus or this
Letter of Transmittal may be directed to the Exchange Agent at the address
specified above. The telephone number for the Exchange Agent is (617) 664-5590.
Holders may also contact their broker, dealer, commercial bank, trust company or
other nominee for assistance concerning the Exchange Offer.
10
<PAGE>
(DO NOT WRITE IN SPACE BELOW)
Certificate Old Notes Old Notes
Surrendered Tendered Accepted
____________________ ___________________________ _______________________
____________________ ___________________________ _______________________
____________________ ___________________________ _______________________
____________________ ___________________________ _______________________
Delivery Prepared By: ______________ Checked By: ___________ Dated:_____________
11
<PAGE>
<TABLE>
<CAPTION>
PAYOR'S NAME: Health and Retirement Properties Trust
<S> <C> <C>
PART I -- PLEASE PROVIDE YOUR TIN IN
SUBSTITUTE THE BOX AT RIGHT AND CERTIFY BY ____________________________
Form W-9 SIGNING AND DATING BELOW Social Security Number
OR
----------------------------
Employer Identification Number
PART II -- Certification--Under penalties of perjury, I certify that:
Department of
the Treasury (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting
Internal Revenue for a number to be issued to me), and
Service
(2) I am not subject to backup withholding because (i) I am exempt from backup withholding, (ii) I
have not been notified by the Internal Revenue Service ("IRS") that I am subject to backup
withholding as a result of a failure to
report all interest or dividends, or (iii)
the IRS has notified me that I am no longer
subject to backup withholding.
Certification Instructions--You must cross out item (2) in Part II above if
Payer's Request you have been notified by the IRS that you are subject to backup withholding
for Taxpayer because of underreporting interest or dividends on your tax return. However,
Identification if after being notified by the IRS that you were subject to backup withholding
Number (TIN) you received another notification from the IRS that you are no longer subject
PART III to backup withholding, do not cross out item (2). PART III
Awaiting TIN |_|
Signature:__________________________________ Date:_________
Name (Please Print):________________________________________
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY RESULT
IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE
IF YOU CHECKED THE BOX IN PART III OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification
number has not been issued to me, and either (i) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or (ii)
I intend to mail or deliver an application in the near future. I understand that
if I do not provide a taxpayer identification number within 60 days, 31% of all
reportable payments made to me thereafter will be withheld until I provide a
number.
________________________________________ ______________________________
Signature Date
________________________________________
Name (Please Print)
12
Exhibit 99.2
FORM OF NOTICE OF GUARANTEED DELIVERY
FOR
6 3/4% SENIOR NOTES DUE 2002
OF
HEALTH AND RETIREMENT PROPERTIES TRUST
As set forth in the Prospectus, dated ___________, 1998 (the
"Prospectus") of Health and Retirement Properties Trust (the "Company") and the
accompanying Letter of Transmittal and instructions thereto (the "Letter of
Transmittal"), this form or one substantially equivalent hereto must be used to
accept the Company's exchange offer (the "Exchange Offer") to purchase all of
its outstanding 6 3/4% Senior Notes Due 2002 (the "Old Notes") if (i)
certificates representing the Old Notes to be tendered for purchase and payment
are not lost but are not immediately available, (ii) time will not permit the
Letter of Transmittal, certificates representing such Old Notes or other
required documents to reach the Exchange Agent prior to the Expiration Date or
(iii) the procedures for book-entry transfer cannot be completed prior to the
Expiration Date. This form may be delivered by an Eligible Institution by mail
or hand delivery or transmitted, via telegram, telex or facsimile, to the
Exchange Agent as set forth below. All capitalized terms used herein but not
defined herein shall have the meanings ascribed to them in the Prospectus.
THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON
____________, 1998 UNLESS THE OFFER IS EXTENDED (THE "EXPIRATION DATE"). TENDERS
OF OLD NOTES MAY BE WITHDRAWN AT ANY TIME PRIOR TO 5:00 P.M. ON THE EXPIRATION
DATE.
The Exchange Agent:
State Street Bank and Trust Company
By Registered or Certified Mail: By Hand or Overnight Delivery:
State Street Bank and Trust Company State Street Bank and Trust Company
Corporate Trust Department Corporate Trust Department
Two International Place Two International Place
Boston, Massachusetts 02110 Boston, Massachusetts 02110
Attention: Sandy Wong Attention: Sandy Wong
By Facsimile for
Eligible Institutions:
(617) 664-5290
For confirmation
and/or information
call:
(617) 664-5590
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION VIA
TELEGRAM, TELEX OR FACSIMILE, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE
A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on
the Letter of Transmittal is required to be guaranteed by an "Eligible
Institution" participating in a recognized medallion signature guarantee program
under the instruction thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
<PAGE>
To: State Street Bank and Trust Company
Ladies and Gentlemen:
The undersigned hereby tender(s) to the Company, upon the terms and
subject to the conditions set forth in the Exchange Offer and the Letter of
Transmittal, receipt of which is hereby acknowledged, the aggregate principal
amount of Old Notes set forth below pursuant to the guaranteed delivery
procedures set forth in the Prospectus.
The undersigned understands that tenders of Old Notes pursuant to the
Exchange Offer may not be withdrawn after 5:00 p.m., New York City time on the
Expiration Date. Tenders of Old Notes may also be withdrawn if the Exchange
Offer is terminated without any such Old Notes being purchased thereunder or as
otherwise provided in the Prospectus.
All authority herein conferred or agreed to be conferred by this Notice
of Guaranteed Delivery shall survive the death or incapacity of the undersigned
and every obligation of the undersigned under this Notice of Guaranteed Delivery
shall be binding upon the heirs, personal representatives, executors,
administrators, successors, assigns, trustees in bankruptcy and other legal
representatives of the undersigned.
PLEASE SIGN AND COMPLETE
Signature(s) of Registered Owner(s) or Names(s) of Registered Holder(s):
Authorized Signatory:
_________________________________ ______________________________
_________________________________ ______________________________
Aggregate Principal Amount of Old Address:
Notes Tendered:
_________________________________ ______________________________
_________________________________ ______________________________
Area Code and
Certificate No(s) of Old Notes Telephone No.:_________________
(if available):
If Old Notes will be delivered by
_________________________________ book-entry transfer at
_________________________________ The Depository Trust Company,
_________________________________ Insert DTC Book-entry Account
Date:_____________________________ No.:__________________________
This Notice of Guaranteed Delivery must be signed by the registered holder(s) of
Old Notes exactly as its (their) name(s) appear on certificates for Old Notes,
or by person(s) authorized to become registered holder(s) by endorsements and
documents transmitted with this Notice of Guaranteed Delivery. If signature is
by a trustee, executor, administrator, guardian, attorney-in-fact, officer or
other person acting in a fiduciary or representative capacity, such person must
provide the following information.
2
<PAGE>
Please print name(s) and address(es)
Name(s):____________________________________
Capacity: __________________________________
Address(es):________________________________
DO NOT SEND OLD NOTES WITH THIS FORM. NOTES SHOULD BE SENT TO THE EXCHANGE AGENT
TOGETHER WITH A PROPERLY COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL.
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a member firm of a registered national securities
exchange or of the National Association of Securities Dealers, Inc. or a
commercial bank or trust company having an office or a correspondent in the
United States, hereby (a) represents that each holder of Old Notes on whose
behalf this tender is being made "own(s)" the Old Notes covered hereby within
the meaning of Rule 14e-4 under the Securities Exchange Act of 1934, as amended,
(b) represents that such tender of Notes complies with such Rule 14e-4, and (c)
guarantees that, within three New York Stock Exchange trading days from the date
of this Notice of Guaranteed Delivery, a properly completed and duly executed
Letter of Transmittal (or a facsimile thereof), together with certificates
representing the Old Notes covered hereby in proper form for transfer (or
confirmation of the book-entry transfer of such Old Notes into the Exchange
Agent's account at The Depository Trust Company, pursuant to the procedure for
book-entry transfer set forth in the Prospectus) and required documents will be
deposited by the undersigned with the Exchange Agent.
THE UNDERSIGNED ACKNOWLEDGES THAT IT MUST DELIVER THE LETTER OF
TRANSMITTAL AND OLD NOTES TENDERED HEREBY TO THE EXCHANGE AGENT WITHIN THE TIME
PERIOD SET FORTH ABOVE AND THAT FAILURE TO DO SO COULD RESULT IN FINANCIAL LOSS
TO THE UNDERSIGNED.
Name of Firm:_________________________ _________________________________
Authorized Signature
Address:______________________________ Name:____________________________
______________________________________
Title:___________________________
Area Code and Telephone No.: Date:____________________________
______________________________________
3
