<PAGE> 1
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 30, 1995
REGISTRATION NO. 33-
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
---------------------
NATIONAL HEALTHCARE L.P.
(Exact name of registrant as specified in its partnership agreement)
<TABLE>
<S> <C>
DELAWARE 62-1293855
(State or other jurisdiction of incorporation (I.R.S. Employer Identification Number)
or organization)
</TABLE>
100 VINE STREET - SUITE 1400
MURFREESBORO, TENNESSEE 37130
(615) 890-2020
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
---------------------
RICHARD F. LAROCHE, JR.
SENIOR VICE PRESIDENT AND SECRETARY
NATIONAL HEALTHCARE L.P.
100 VINE STREET - SUITE 1400
MURFREESBORO, TENNESSEE 37130
(615) 890-2020
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
---------------------
COPIES TO:
<TABLE>
<S> <C>
ERNEST E. HYNE II MITCHELL S. FISHMAN
HARWELL HOWARD HYNE GABBERT & MANNER, P.C. PAUL, WEISS, RIFKIND, WHARTON & GARRISON
1800 FIRST AMERICAN CENTER 1285 AVENUE OF THE AMERICAS
NASHVILLE, TENNESSEE 37219 NEW YORK, NEW YORK 10019
(615) 256-0500 (212) 373-3000
</TABLE>
---------------------
APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: As soon as
practicable after the effective date of this Registration Statement.
---------------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest investment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, as amended (the "Securities Act") other than securities offered only in
connection with dividend or interest reinvestment plans, check the following
box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
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CALCULATION OF REGISTRATION FEE
<TABLE>
<S> <C> <C> <C> <C>
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TITLE OF EACH CLASS OF AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM
SECURITIES TO BE TO BE OFFERING PRICE AGGREGATE AMOUNT OF
REGISTERED REGISTERED PER DEBENTURE(1) OFFERING PRICE REGISTRATION FEE
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6% Senior Subordinated
Convertible
Debentures.............. $30,000,000 2,022 60,665,929.50 $20,919.18
Units..................... (2) (3)
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</TABLE>
(1) Estimated on an as-if-converted basis, based on the closing price of the
Units on August 28, 1995.
(2) Such indeterminate number of Units as may be required for issuance upon
conversion of the Debentures.
(3) Pursuant to Rule 457, the registration fee is calculated on the basis of the
proposed offering price of the convertible debentures alone, as no
additional consideration is to be received in connection with the exercise
of the conversion privilege.
---------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT, OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME EFFECTIVE
ON SUCH DATE AS THE SECURITIES AND EXCHANGE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
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<PAGE> 2
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 LAWS
OF ANY SUCH STATE.
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED AUGUST 30, 1995
PROSPECTUS
NATIONAL HEALTHCARE L.P.
$30,000,000
6.0% SENIOR SUBORDINATED CONVERTIBLE DEBENTURES DUE 2000
---------------------
This Prospectus relates to 6.0% Senior Subordinated Convertible Debentures
due 2000 (the "Debentures") of National HealthCare L.P. (the "Company" or "NHC")
in the aggregate principal amount of $30,000,000 to be sold on behalf of The
1818 Fund, L.P. (the "Selling Securityholder"). The Debentures mature on July 1,
2000. The Debentures are convertible at any time prior to maturity, unless
previously redeemed, into limited partnership units (the "Units") of NHC at a
conversion price of $15.2063 per Unit, subject to adjustment in certain
circumstances. Interest on the Debentures is payable quarterly on the last
business day of March, June, September and December of each year. In the event
of a Change of Control of the Company, each holder of a Debenture ("Holder")
will have the right to require the Company to redeem the Debentures at a
redemption price of 125% of the principal amount, plus accrued and unpaid
interest. The Debentures are unsecured and subordinated in right of payment to
all Senior Indebtedness of the Company. See "Description of the Debentures." At
June 30, 1995, the amount of outstanding Senior Indebtedness of the Company was
approximately $294,794,000.
None of the proceeds from the sale of the Debentures will be received by
the Company. The Company has paid all costs and fees associated with the
registration of the Debentures under the Federal and state securities laws and
the preparation and delivery of this Prospectus, certain of which will be
reimbursed by the Selling Securityholder.
The Debentures may be sold at any time and from time to time: (i) directly
by the Selling Securityholder; (ii) through underwriting syndicates represented
by one or more managing underwriters, or by one or more underwriters without a
syndicate; and (iii) through brokers, dealers or other agents designated from
time to time. The names of any underwriters or agents of the Selling
Securityholder involved in the sale of the Debentures in respect of which this
Prospectus is being delivered and any applicable commissions or discounts will
be set forth in an accompanying supplement to this Prospectus (the "Prospectus
Supplement"). See "Plan of Distribution."
The Units are listed on the American Stock Exchange under the symbol "NHC."
On August 28, 1995, the reported closing price of the Company's Units on the
American Stock Exchange was $30.75 per Unit. Application will be made to list
the Debentures on the American Stock Exchange under the symbol "NHC.A."
---------------------
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.
---------------------
This Prospectus may not be used to consummate sales of Debentures unless
accompanied by a Prospectus Supplement.
---------------------
The date of this Prospectus is August 30, 1995.
<PAGE> 3
AVAILABLE INFORMATION
The Company's principal executive offices are located at 100 Vine Street,
Suite 1400, Murfreesboro, Tennessee 37130, (615) 890-2020. 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 and information statements and other information with the
Securities and Exchange Commission (the "Commission"). Copies of such reports
and other information filed by the Company can be obtained, at prescribed rates,
from the Public Reference Section of the Commission at room 1024, 450 Fifth
Street, N.W., Judiciary Plaza, Washington, D.C. 20549. In addition, such reports
and other information can be inspected at the Public Reference Section referred
to above and at the Regional Offices of the Commission at Northwest Atrium
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661; and 75
Park Place, 14th Floor, New York, New York 10007. Copies of such material can be
obtained by mail from the Public Reference Section of the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates. The Units of the
Company are listed on the American Stock Exchange, and reports, proxy and
information statements and other information concerning the Company can be
inspected and copied at the offices of the American Stock Exchange, 86 Trinity
Place, New York, New York 10006-1881.
The Company has filed with the Commission a registration statement on Form
S-3 (together with all amendments and exhibits thereto, the "Registration
Statement") under the Securities Act of 1933, as amended (the "Securities Act").
This Prospectus and any accompanying Prospectus Supplement do not contain all of
the information set forth in the Registration Statement, certain parts of which
are omitted in accordance with the rules and regulations of the Commission. For
further information, reference is hereby made to the Registration Statement.
Statements made in this Prospectus and any accompanying Prospectus
Supplement as to the contents of any contract or other document referred to are
not necessarily complete, and reference is made to the copy of such contract or
other document filed as an exhibit to the Registration Statement, each such
statement being qualified in all respects by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents filed by the Company with the Commission are
incorporated herein by reference:
The Annual Report of the Company on Form 10-K for the year ended
December 31, 1994.
The Quarterly Reports of the Company on Form 10-Q for the quarters
ended March 31, and June 30, 1995.
The Company's Registration Statement on Form 8-A relating to the
Company's Units.
All documents subsequently filed by the Company with the Commission
pursuant to Section 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to
the termination of this offering shall be deemed to be incorporated by reference
in this Prospectus. 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 that 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, including any
beneficial owner, to whom this Prospectus is delivered, upon the request of such
person, a copy of any or all of the documents which are incorporated by
reference in this Prospectus, but not delivered herewith, other than exhibits to
such documents (unless such exhibits are specifically incorporated by reference
into the information that this Prospectus incorporates). Written or telephone
requests should be directed to Richard F. LaRoche, Jr., Senior Vice President,
Secretary and General Counsel, National HealthCare L.P., 100 Vine Street, Suite
1400, Murfreesboro, Tennessee 37130, (615) 890-2020.
2
<PAGE> 4
RATIO OF EARNINGS TO FIXED CHARGES
<TABLE>
<CAPTION>
SIX MONTHS
ENDED
YEAR ENDED DECEMBER 31, JUNE 30,
---------------------------------------- -------------
1990 1991 1992 1993 1994 1994 1995
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges....... 2.77 2.25 1.73 3.97 2.11 2.09 2.02
</TABLE>
For the purposes of calculating the ratio of earnings to fixed charges, net
income has been added to fixed charges and that sum has been divided by such
fixed charges. Fixed charges consist of interest expense, whether expensed or
capitalized and amortization of debt expense and discount or premium relating to
any indebtedness, whether expensed or capitalized.
USE OF PROCEEDS
The Company will not receive any of the proceeds from the sale of the
Debentures by the Selling Securityholder.
SELLING SECURITYHOLDER
The Company, in a private placement completed on May 12, 1992, sold, and
the Selling Securityholder purchased, a 6.0% Senior Subordinated Convertible
Note due July 1, 2000 (the "Note") in the aggregate principal amount of
$30,000,000. Pursuant to the terms of the Note, prior to the date of this
Prospectus the Note was exchanged for $30,000,000 in principal amount of the
Debentures. Pursuant to the offering described in this Registration Statement
(the "Offering,") the Company is registering, on behalf of the Selling
Securityholder, $30,000,000 aggregate principal amount of the Debentures.
The table below sets forth certain information regarding the beneficial
ownership of the Debentures, as of August 28, 1995, by the Selling
Securityholder both before and after giving effect to the Offering, assuming all
of the Debentures are sold in the Offering. After completing the sale of an
aggregate of $30,000,000 of the Debentures being offered hereby, the Selling
Securityholder will retain no interest in the Company.
<TABLE>
<CAPTION>
DEBENTURES
DEBENTURES BENEFICIALLY
BENEFICIALLY OWNED DEBENTURES OWNED AFTER THE
PRIOR TO OFFERING TO BE SOLD OFFERING
---------------------- IN THE -----------------
AMOUNT PERCENT OFFERING AMOUNT PERCENT
----------- ------- ----------- ------ -------
<S> <C> <C> <C> <C> <C>
Selling Securityholder.................... $30,000,000 100% $30,000,000 $0 0%
</TABLE>
The Selling Securityholder's Debentures covered by this Prospectus may be
sold from time to time so long as this Prospectus remains current and in effect
and is accompanied by a Prospectus Supplement.
3
<PAGE> 5
DESCRIPTION OF THE DEBENTURES
GENERAL
The Debentures were issued to the Selling Securityholder under an Indenture
(the "Indenture") dated August 29, 1995 between the Company and First American
National Bank as trustee (the "Trustee"), a copy of which has been filed as an
exhibit to the Registration Statement. The following summary of certain
provisions of the Indenture does not purport to be complete and is subject to,
and is qualified in its entirety by reference to, all the provisions of the
Indenture, including the definitions of certain terms therein and those terms
made apart thereof by the Trust Indenture Act of 1939, as amended. Wherever
particular sections or defined terms of the Indenture are referred to, it is
intended that such sections or defined terms shall be incorporated herein by
reference. Capitalized terms used herein and not otherwise defined have the
meanings specified in the Indenture. All parenthetical references are to
sections of the Indenture.
The Debentures are unsecured senior subordinated obligations of the
Company, in the aggregate principal amount of $30,000,000 and are convertible
into Units. The Company will pay interest on the principal amount of the
Debentures at a rate of 6.0% per annum. Interest is computed on the basis of a
360-day year consisting of twelve 30-day months and is payable in quarterly
installments in arrears on the last business day of March, June, September and
December of each year to the record holder of such Debenture at the close of
business on the fifteenth day of March, June, September and December,
respectively, even if such Debenture is converted or canceled after such record
date and on or before the interest payment date. The Company will pay interest
on overdue principal and on overdue interest (to the full extent permitted by
law) at a rate equal to 8.0% per annum. Principal and interest on the Debentures
will be payable at the office of the Trustee.
OPTIONAL REDEMPTION
Except as otherwise provided herein, the Company does not have any right to
prepay or redeem the Debentures. On and after January 1, 1998 or, if the Company
shall have elected to be taxable as a corporation and as of the Redemption Date
(as defined below) the current market price of the aggregate number of Units
into which the Debentures to be redeemed shall be convertible as of the
Redemption Date shall equal or exceed the Recovery Amount (as defined below), on
or after May 12, 1996, the Company shall have the right, at any time and from
time to time at its sole option and election, to redeem the Debentures, in whole
or in part in integral multiples of $10,000,000 outstanding principal amount, on
not less than 30 days notice of the date of redemption, which must be a Business
Day (any such date an "Redemption Date"), at a price (the "Redemption Price")
equal to (i) the outstanding principal amount of the Debentures to be redeemed
plus (ii) an amount equal to all accrued and unpaid interest thereon, whether or
not currently payable, to the applicable Redemption Date, in cash or other
immediately available funds. For purposes hereof, "Recovery Amount" shall mean
the amount by which (i) the amount that results from compounding the principal
amount of the Debentures to be redeemed at a rate of 25 percent per annum from
the date of issuance of the Note to the Redemption Date exceeds (ii) the amount
that results from compounding all amounts of interest paid, including Additional
Interest (as defined in the Indenture), and other distributions made with
respect to the principal amount of the Debentures to be redeemed on or prior to
the Redemption Date at a rate of 25 percent per annum from, in the case of each
such payment of interest or other distribution, the date such payment or other
distribution is made to the Redemption Date. (Section 3.01.)
Notice of any redemption of the Debentures shall be mailed at least 30, but
not more than 60, days prior to the date fixed for redemption to each Holder of
the Debentures to be redeemed, at such Holder's address as it appears on the
transfer books of the Company. (Section 3.01(b).)
If there is a redemption of less than the entire outstanding principal
amount of all outstanding Debentures, each outstanding Debenture shall be
redeemed in part pro rata to all other outstanding Debentures on the basis of
outstanding principal amount of such Debentures. (Section 3.02.)
On the date of any redemption being made pursuant to this optional
redemption which is specified in a notice given as described above, the Company
shall, and at any time after such notice shall have been mailed and before the
date of redemption the Company may, deposit for the benefit of the Holders of
the Debentures
4
<PAGE> 6
to be redeemed the funds necessary for such redemption with the Paying Agent (as
defined in the Indenture). (Section 3.05.)
Notice of redemption having been given as aforesaid, upon the deposit of
funds as described above, notwithstanding that any such Debentures themselves
shall not have been surrendered for cancellation, from and after the date of
redemption designated in the notice of redemption (i) that portion of the
principal amount of the Debentures that is to be redeemed shall no longer be
deemed outstanding, (ii) the rights to receive interest thereon shall cease to
accrue and (iii) all rights of the Holders to be redeemed shall cease and
terminate with respect to that portion of the principal amount of the Debentures
that is to be redeemed, excepting only the right to receive the Redemption Price
therefor and the right to convert such Debentures into Units until the close of
business on the date of redemption; provided, however, that if the Company shall
default in the payment of the Redemption Price, that portion of the principal
amount of the Debentures that was to be redeemed shall thereafter be deemed to
be outstanding and the Holders thereof shall have all of the rights of a Holder
of Debentures until such time as such default shall no longer be continuing or
shall have been waived by Holders of at least 66 2/3% of the then outstanding
principal amount of the Debentures. (Section 3.04.)
CONVERSION RIGHTS
The Holders shall have the right, at their option, at any time and from
time to time, to convert, subject to certain conditions, any or all of the then
outstanding principal amount of the Debentures into such number of fully paid
and non-assessable Units as is equal, subject to the provision in the Indenture
regarding fractional Units, to the quotient of the principal of the Debentures
being so converted divided by the Conversion Price (as defined below) then in
effect, except that with respect to any portion of the Debentures which shall be
called for redemption, such right shall terminate at the close of business on
the date of redemption for such portion of the Debentures, unless in any such
case the Company shall default in performance or payment due upon redemption
thereof. The "Conversion Price" shall be $15.2063, subject to adjustment if the
Company shall, among other things, at any time or from time to time (i) pay a
dividend or make a distribution (other than a dividend or distribution paid or
made to the Debenture Holders) on the outstanding Units in Units or other equity
interests (which, for purposes of this condition shall include, without
limitation, any dividends or distributions in the form of options, warrants or
other rights to acquire Units or other equity interests) of the Company, (ii)
subdivide the outstanding Units into a larger number of Units, (iii) combine the
outstanding Units into a smaller number of Units, (iv) issue any equity interest
in a reclassification of the Units, (v) pay a dividend or make a distribution on
the outstanding Units in Units or other equity interests pursuant to a rights
plan, "poison pill" or similar arrangement, (vi) sell Units (or securities
convertible into or exchangeable for Units, or any options, warrants or other
rights to acquire Units) (subject to certain exceptions) at a price per Unit
less than the Current Market Price per Unit (as defined in the Indenture) or at
a price per Unit less than the Conversion Price then in effect; (vii) distribute
with respect to the Units cash, evidences of indebtedness of the Company or
another issuer, securities of the Company or another issuer or other assets
(with certain exceptions described in the Indenture); or (viii) take any action
affecting the Units or the Company's other equity interests as determined in
good faith by the Board of Directors. (Section 10.04.)
Such conversion right shall be exercised by the surrender of the Debenture
to the Company at any time during usual business hours at its principal place of
business to be maintained by it, accompanied by written notice that the Holder
elects to convert the Debenture (or a specified portion of the outstanding
principal amount thereof) and specifying the name or names (with address) in
which a certificate or certificates for Units are to be issued and (if so
required by the Company) by a written instrument or instruments of transfer in
form reasonably satisfactory to the Company duly executed by the Holder or its
duly authorized legal representative and transfer tax stamps or funds therefor,
if required under the Indenture. If less than all of the then outstanding
principal amount of the Holder's Debentures are to be converted, the Company
will promptly issue and deliver to the Holder a new Debenture in the principal
amount of the unconverted portion of the Debenture submitted for conversion.
(Sections 10.01 and 10.07.)
5
<PAGE> 7
CHANGE OF CONTROL
The Company shall, within 15 Business Days of a Change of Control (as
defined below) redeem the Debentures at the option of the Holders at a
redemption price of 125% of the principal amount plus accrued and unpaid
interest. A "Change of Control" shall be deemed to have occurred:
(i) At such times as any person or "group" (within the meaning of
Section 13(d)(3) of the Exchange Act, not including Mr. W. Andrew Adams
("Adams"), National Healthcare Corporation, a Tennessee corporation
("Administrative General Partner"), the Managing General Partner and each
of the shareholders of the Managing General Partner (collectively, "Current
Management"), is or becomes the beneficial owner, directly or indirectly,
of outstanding Units of the Company or of shares of capital stock of the
Managing General Partner of the Company, entitling such Person or Persons
to exercise 50% or more of the total votes entitled to be cast at a regular
or special meeting, or by action by written consent, of the Unit holders of
the Company or of the shareholders of the Managing General Partner, as the
case may be;
(ii) If a majority of the Board of Directors of the Managing General
Partner shall consist of persons other than those persons who were members
of the Board of Directors of the Managing General Partner on May 12, 1992
and any other member of the Board of Directors of the Managing General
Partner who was recommended or elected to succeed or become a director by a
majority of directors who were on May 12, 1992 members of the Board of
Directors of the Managing General Partner.
(iii) At such time as the Unit holders of the Company or holders of
shares of capital stock of the Managing General Partner, as the case may
be, shall have approved a reorganization, merger or consolidation, in each
case, with respect to which all or substantially all of the persons who
were the respective beneficial owners of the outstanding Units of the
Company or, of the outstanding shares of capital stock of the Managing
General Partner, as the case may be, immediately prior to such
reorganization, merger or consolidation, beneficially own, directly or
indirectly, less than 50% of the combined voting power of the then
outstanding Units of the Company or the outstanding shares of capital stock
of the Managing General Partner, as the case may be, resulting from such
reorganization, merger or consolidation;
(iv) At the earlier of the approval of (A) the Unit holders of the
Company, (B) the holders of shares of capital stock of the Managing General
Partner or (C) the Board of Directors of the Managing General Partner of
the sale or other disposition of all or substantially all the assets of the
Company or the Managing General Partner, as the case may be, in one
transaction or in a series of related transactions, other than (1) a
transaction or series of transactions effected solely for the purpose of
converting the form of the Company to a corporation and in which Unit
holders of the Company prior to such conversion acquire, on a pro rata
basis, all of the capital stock of the Company following such conversion or
(2) a distribution of assets by the Company to all of its Unit holders on a
pro rata basis;
(v) If immediately after any merger, consolidation, combination,
reclassification or recapitalization, Current Management (A) shall have
increased the aggregate percentage of the outstanding Units of the Company
represented by the Units they beneficially own, directly or indirectly, by
20% of such outstanding Units or more (or if the entity surviving such
transaction is a corporation, the Current Management's ownership in the new
entity shall have increased by 20% or more of the Current Management's
aggregate percentage of ownership of the Company immediately prior to the
transaction) and (B) shall be the beneficial owners directly or indirectly,
of outstanding Units or shares of stock of the Company (or any person
surviving such transaction) entitling the Current Management collectively
to exercise 50% or more of the total voting power of all Units and other
voting equity interest, if any, of the Company (or the surviving person in
such transaction) and, in anticipation of, in connection with or as a
result of such transaction, the Company (or such surviving person) shall
have incurred or issued additional indebtedness such that the total
indebtedness so incurred or issued equals at least 50% of the consideration
payable in such transaction; provided, however, that any such transaction
shall not be considered a Change of Control if the Holders shall have
participated therein on no less than a pari passu basis (assuming
conversion of all of the Holders' Debentures into Units) with Current
Management collectively;
6
<PAGE> 8
(vi) At the earlier of the approval by (A) the Unit holders of the
Company or (B) the Board of Directors of the Managing General Partner of
any transaction the result of which is that the Units shall no longer be
required to be registered under Section 12 of the Exchange Act and that the
holders of Units do not receive common stock of the Person surviving such
transaction which is required to be registered under Section 12 of the
Exchange Act.
(vii) If a Person other than Adams shall become Special General
Partner (as defined in the Amended and Restated Agreement of Limited
Partnership of the Company), other than solely by reason of the death,
disability or personal bankruptcy of Adams (Section 11.02.)
The Company's offer to redeem due to the occurrence of a Change of Control
(the "Change of Control Offer") shall remain open from the time of mailing until
the redemption date set forth in the notice of offer (the "Notice of Offer"),
which must be accompanied by certain financial statements and officer's
certificates. (Section 11.03.)
SUBORDINATION
The payment of the principal of, premium, if any, and interest on the
Debentures, together with any other payments payable in respect of the
Debentures, including, without limitation, any amount payable in connection with
the redemption or repurchase of the Debentures ("Subordinated Amounts") is
subordinated and subject in right of payment to the prior payment in full of all
Senior Indebtedness (as defined below), whether outstanding at the date of this
Prospectus or hereafter incurred. The term "Senior Indebtedness" means the
principal of, premium, if any, and interest on, and any other payment due
pursuant to any of the following, whether outstanding at the date hereof or
hereafter incurred or created: (a) all indebtedness of the Company for money
borrowed arising under or in connection with any of the loan agreements,
indentures of trust, guarantees and other documents relating to Company
indebtedness with or to State Street Bank and Trust Company of Connecticut,
Third National Bank in Nashville and/or the Toronto Dominion Bank, as any of
such documents may be amended, modified or replaced from time to time (the
"Credit Agreement"), as amended and as any of them may be further amended or
modified from time to time, and all renewals, extensions, refundings or
refinancings of such indebtedness incurred with financial institutions,
insurance companies or other institutional lenders, (any such indebtedness and
renewals, extensions, refundings or refinancings thereof, "Senior Institutional
Indebtedness"); (b) all indebtedness of the Company for money borrowed other
than Senior Institutional Indebtedness (including, without limitation, any
indebtedness secured by a mortgage, conditional sales contract or other lien
which is (i) given to secure all or part of the purchase price of property
subject thereto, whether given to the vendor of such property or to another, or
(ii) existing on property at the time of acquisition thereof); (c) all
indebtedness of the Company evidenced by debentures, bonds or other securities
sold by the Company for money; (d) all lease obligations of the Company which
are capitalized on the books of the Company in accordance with generally
accepted accounting principles; (e) all indebtedness of others of the kinds
described in either of the preceding clauses (b) or (c) and all lease
obligations of others of the kind described in the preceding clause (d) assumed
by or guaranteed in any manner by the Company or in effect guaranteed by the
Company through an agreement to purchase, contingent or otherwise; (f) all
indebtedness of any subsidiary of the Company or of National Health Investors,
Inc., for which the Company is liable as a guarantor; (g) all renewals,
extensions, refundings or refinancings of indebtedness of the kinds described in
any of the preceding clauses (b), (c), (e) and (f) and all renewals or
extensions of lease obligations of the kinds described in either of the
preceding clauses (d) and (e); (h) interest accruing subsequent to the filing of
a petition initiating any bankruptcy, insolvency or similar proceeding with
respect to any indebtedness or lease obligation of the Company; (i) all
obligations of the Company in respect of any rate hedging agreement entered into
with any holder of any Senior Indebtedness; and (j) all fees, expenses,
reimbursements and other amounts payable to holders of Senior Indebtedness under
the terms of the instrument or lease creating or evidencing the same, unless in
the case of any particular indebtedness, lease, renewal, extension, refunding or
refinancing, the instrument or lease creating or evidencing the same or the
assumption or guarantee of the same expressly provides that such indebtedness,
lease, renewal, extension, refunding or refinancing is not senior in right of
payment to the Debentures or is expressly subordinate by its terms in right of
payment to all other indebtedness of the
7
<PAGE> 9
Company. (Section 11.01.) As of June 30, 1995, the aggregate amount of Senior
Indebtedness of the Company was approximately $294,794,000.
No payment shall be made by the Company of any subordinated amounts: (a) in
the event and during the continuation of any default in the payment (a "Payment
Default") of principal, premium, if any, interest or any other payment due on
any Senior Indebtedness under or in connection with the instrument, agreement or
lease evidencing such Senior Indebtedness and the holders of the requisite
principal amounts of such Senior Indebtedness or their agents shall not have
delivered to the Holders a notice of waiver of the benefits of this clause (a)
and a consent to the making of scheduled payments on or on account of the
Debentures or taking any other prohibited action until further notice from such
holders or such agents; or (b) in the event of receipt of written notice by the
Holders from the holders of any Senior Institutional Indebtedness or their
representatives of a default (other than a Payment Default) permitting
acceleration of any Senior Institutional Indebtedness for a period (the
"Blockage Period") terminating on the earlier to occur of (i) the cure, waiver
or cessation of such default or (ii) 180 days from the date of receipt of
written notice thereof by the Holders. At the expiration of such Blockage
Period, and so long as there does not exist a Payment Default, the Company shall
promptly pay to the Holders all sums not paid during such Blockage Period as a
result of this paragraph. For all purposes of this paragraph, no event of
default which existed or was continuing with respect to the Senior Institutional
Indebtedness to which the Blockage Period relates on the date such Blockage
Period commenced shall be or be made the basis for the commencement of any
subsequent Blockage Period by the holder or holders of such Senior Institutional
Indebtedness (or their respective agents) unless such event of default is cured
or waived for a period of not less than 90 consecutive days. There shall be no
more than one Blockage Period initiated in any 360 day period. (Section 11.02.)
Upon any payment by the Company, or distribution of assets of the Company
of any kind or character, whether in cash, property or securities, to creditors
upon any dissolution or winding-up or liquidation or reorganization of the
Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become due upon all
Senior Indebtedness shall first be paid in full, or payment thereof provided for
in money in accordance with its terms, before any payment is made on account of
the principal, premium, if any, or interest on, or other amounts payable in
respect of, the Debentures including, without limitation, any amount payable in
connection with the redemption of the Debentures; and upon any such dissolution,
winding-up or liquidation or reorganization, any payment by the Company or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, to which the Holders would be entitled, except for the
subordination provisions, shall be paid by the Company or by any receiver,
trustee in bankruptcy, liquidating trustee, agent or other person making such
payment or distribution, or by the Holders if received by them, directly to the
holders of Senior Indebtedness (pro rata to such holders on the basis of the
respective amounts of Senior Indebtedness held by such holders) or their
representative or representatives, or to the trustee or trustees under any
indenture pursuant to which any instruments evidencing any Senior Indebtedness
may have been issued, as their respective interests may appear, to the extent
necessary to pay all Senior Indebtedness in full, in money or money's worth,
after giving effect to any concurrent payment or distribution to or for the
holders of Senior Indebtedness, before any payment or distribution is made to
the Holders. (Section 11.02.)
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in cash,
property or securities, prohibited by the foregoing, shall be received by the
Holders before all Senior Indebtedness is paid in full, or provision is made for
such payment in money in accordance with its terms, such payment or distribution
shall be held in trust for the benefit of and shall be paid over or delivered to
the holders of Senior Indebtedness or their representative or representatives,
or to the trustee or trustees under any indenture pursuant to which any
instrument evidencing any Senior Indebtedness may have been issued, as their
respective interests may appear, for application to the payment of all Senior
Indebtedness remaining unpaid to the extent necessary to pay all Senior
Indebtedness in full in money in accordance with its terms, after giving effect
to any concurrent payment or distribution to or for the holders of such Senior
Indebtedness. (Section 11.02.)
Subject to the payment in full of all Senior Indebtedness, the rights of
the Holders shall be subrogated to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
8
<PAGE> 10
securities of the Company applicable to the Senior Indebtedness until the
principal of (and premium, if any) and interest on the Debentures shall be paid
in full; and, for the purposes of such subrogation, no payments or distributions
to the holders of the Senior Indebtedness of any cash, property or securities to
which the Holders would be entitled except for the subordination provisions, and
no payment to or for the benefit of the holders of Senior Indebtedness by the
Holders, shall, as between the Company, its creditors other than holders of
Senior Indebtedness and the Holders, be deemed to be a payment by the Company to
or on account of the Senior Indebtedness. (Section 11.03.)
If any payment or distribution to which the Holders otherwise would have
been entitled but for the subordination provisions shall have been applied,
pursuant to the subordination provisions, to the payment of amounts payable
under Senior Indebtedness of the Company, then, and in such case, the Holders
shall be entitled to receive from the holders of Senior Indebtedness the full
amount of any such payments or distributions received by holders of Senior
Indebtedness in excess of the amount sufficient to pay in full all amounts
payable under or in respect of, the Senior Indebtedness of the Company. (Section
11.03.)
The Company shall give prompt written notice to the Holders of any fact
known to the Company which would prohibit the making of any payment to the
Holders. (Section 11.05.)
EVENTS OF DEFAULT, NOTICE AND WAIVER
The following is a summary of certain provisions of the Indenture relating
to events of default, notice and waiver.
The following, among other things, are Events of Default under the
Indenture with respect to the Debentures: (i) default in the payment of interest
on the Debentures when due and payable which continues for 15 business days;
(ii) default in the payment of principal of the Debentures when due and payable,
at maturity, upon redemption or otherwise; (iii) failure to perform any other
covenant of the Company contained in the Indenture or the Debentures which
continues for 30 days after notice as provided in the Indenture; (iv) default in
the payment of Indebtedness in an aggregate principal amount in excess of
$10,000,000, when due, after grace periods with respect thereto shall have
expired and upon non-waiver by the holders of any such Indebtedness and such
default continues unremedied for 30 days, or there has been an acceleration of
in excess of $10,000,000 aggregate principal amount of Indebtedness of the
Company by the holder thereof following an event of default as defined in such
Indebtedness whether existing on the date of the execution of the Indenture or
thereafter created; (v) a judgment for the payment of money, the uninsured
portion of which exceeds $10,000,000 is rendered against the Company and remains
undischarged for a period of 60 days after the date on which the judgment has
been rendered unless no proceeding for execution of such judgment has been
commenced or any such proceeding has been stayed; and (vi) certain events of
bankruptcy, insolvency or reorganization relating to the Company.
If an Event of Default occurs (other than an Event of Default described in
(vi) above) and is continuing with respect to the Debentures, either the Trustee
or the Holders of at least 25% in principal amount of the Debentures may declare
all of the Debentures to be due and payable immediately. If an Event of Default
described in (vi) above occurs, the Debentures shall automatically become
immediately due and payable.
The Trustee may require indemnity satisfactory to it before it enforces the
Indenture or the Debentures. Subject to certain limitations, holders of a
majority in principal amount of the Debentures may direct the Trustee in its
exercise of any trust or power. The Trustee may withhold from Holders notice of
any default (except a default in payment of principal or interest) if it
determines that withholding notice is in their interests. The Company is
required to file with the Trustee annually an officers' statement as to the
absence of defaults in fulfilling any of its obligations under the Indenture.
MODIFICATION OF THE INDENTURE
Under the Indenture, with certain exceptions, the rights and obligations of
the Company with respect to the Debentures and the rights of Holders of such
Debentures may only be modified by the Company and the Trustee with the consent
of the Holders of at least a majority in principal amount of the outstanding
9
<PAGE> 11
Debentures. However, without the consent of each Holder of any Debenture
affected, an amendment, waiver or supplement may not, among other things, (i)
reduce the principal of, or rate of interest on, the Debentures, (ii) extend the
maturity date of the principal of, or any installment of interest on, the
Debentures; (iii) waive (unless cured) a default in the payment of the principal
amount of, or the interest on, or any premium payable on redemption of, the
Debentures; (iv) change the currency for payment of the principal of, or premium
or interest on, the Debentures; (v) impair the right to institute suit for the
enforcement of any such payment when due; (vi) adversely affect any right to
convert the Debentures; (vii) reduce the amount of outstanding Debentures
necessary to consent to an amendment, supplement or waiver provided for in the
Indenture; or (viii) modify any provisions of the Indenture relating to the
modification and amendment of the Indenture or waivers of past defaults, except
as otherwise specified.
CONSOLIDATION, MERGER, SALE OR CONVEYANCE
The Indenture provides that the Company may not merge or consolidate with,
or sell or convey all, or substantially all, of its assets to another person
unless such person is a company or a partnership organized under the laws of the
United States, any states thereof or the District of Columbia; such person
assumes by supplemental indenture all the obligations of the Company under the
Debentures and the Indenture; such person has a consolidated net worth at least
equal to the consolidated net worth of the Company immediately prior to such
transaction and immediately after the transaction no default or Event of Default
shall exist.
No consent of Holders is required for the Company to consolidate with or
merge into or transfer or lease substantially all of its assets to another
corporation or partnership which assumes the obligations of the Company under
the Indenture and Debentures or for any reorganization within the meaning of
Section 368(a)(1)(B) of the Internal Revenue Code nor is any such consent of
Holders required for any amendment of the Indenture or the Debentures by the
Company and the Trustee to cure any ambiguity, defect or inconsistency, or to
provide for uncertificated Debentures in addition to certified Debentures, or to
make any change that does not adversely affect the right of any Holder.
GOVERNING LAW
The Indenture and the Debentures will be governed by and construed in
accordance with the laws of the State of New York.
10
<PAGE> 12
PLAN OF DISTRIBUTION
The Selling Securityholder may sell the Debentures at any time and from
time to time: (i) directly; (ii) through underwriting syndicates represented by
one or more managing underwriters, or by one or more underwriters without a
syndicate; and (iii) through brokers, dealers or other agents designated from
time to time. The names of any underwriters or agents of the Selling
Securityholder involved in the sale of the Debentures in respect of which this
Prospectus is being delivered and any applicable commissions or discounts will
be set forth in the Prospectus Supplement.
Agents and underwriters may be entitled under agreements entered into with
the Company to indemnification by the Company against certain civil liabilities,
including liabilities under the Securities Act, or to contribution with respect
to payments which the agents or underwriters may be required to make in respect
thereof. Agents and underwriters may engage in transactions with or perform
services for the Company in the ordinary course of business.
Prior to this Offering, there has been no public market for the Debentures.
Application will be made to list the Debentures on the American Stock Exchange.
The Units are listed on the American Stock Exchange under the symbol "NHC".
The Selling Securityholder and any broker or dealer to or through whom any
of the Debentures are sold may be deemed to be an underwriter within the meaning
of the Securities Act with respect to the Debentures offered hereby, and any
profits realized by the Selling Securityholder or such brokers or dealers may be
deemed to be underwriting discounts or commissions. The registration of the
Debentures under the Securities Act shall not be deemed an admission by the
Selling Securityholder or the Company that the Selling Securityholder is an
underwriter of any Debentures offered under this Prospectus for purposes of the
Securities Act.
LEGAL MATTERS
The validity of the Debentures offered hereby will be passed upon for the
Company by Harwell Howard Hyne Gabbert & Manner, P.C., 1800 First American
Center, Nashville, Tennessee 37238.
EXPERTS
The consolidated financial statements and schedules of the Company as of
and for the periods ended December 31, 1994, December 31, 1993 and December 31,
1992, incorporated by reference herein, from the Company's Annual Report on Form
10-K for the year ended December 31, 1994, have been audited by Arthur Andersen
LLP, independent public accountants, as indicated in their reports with respect
thereto, and are included herein in reliance upon the authority of said firm as
experts in giving said reports.
11
<PAGE> 13
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NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS IN CONNECTION WITH THE OFFER MADE
BY THIS PROSPECTUS AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS
MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR ANY OTHER
PERSON. NEITHER THE DELIVERY OF THIS PROSPECTUS NOR ANY SALE MADE HEREUNDER AND
THEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT THERE HAS
BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF OR THAT THE
INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE
HEREOF. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER TO SELL OR SOLICITATION OF
AN OFFER TO BUY, ANY OF THE DEBENTURES IN ANY JURISDICTION TO ANY PERSON TO WHOM
IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION IN SUCH JURISDICTION.
---------------------
TABLE OF CONTENTS
PROSPECTUS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information.................. 2
Incorporation of Certain Information by
Reference............................ 2
Ratio of Earnings to Fixed Charges..... 3
Use of Proceeds........................ 3
Selling Securityholder................. 3
Description of the Debentures.......... 4
Plan of Distribution................... 11
Legal Matters.......................... 11
Experts................................ 11
</TABLE>
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
NATIONAL HEALTHCARE L.P.
6.0% SENIOR SUBORDINATED
CONVERTIBLE DEBENTURES
DUE 2000
------------------------
PROSPECTUS
------------------------
August 30, 1995
------------------------------------------------------
------------------------------------------------------
<PAGE> 14
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
<TABLE>
<CAPTION>
<S> <C>
Registration Fee........................................................ $ 20,919.18
Listing Fee*............................................................ 22,500.00
Blue Sky fees and expenses*............................................. 5,000.00
Accounting fees and expenses*........................................... 15,000.00
Legal fees and expenses*................................................ 50,000.00
Transfer Agent Fees*.................................................... 5,000.00
Printing and Engraving costs*........................................... 20,000.00
Miscellaneous*.......................................................... 6,580.82
-----------
Total.................................................... $145,000.00
</TABLE>
- ---------------
* Estimated
INDEMNIFICATION
ITEM 15.
Indemnification of General Partners. The Company's Amended and Restated
Agreement of Limited Partnership (the "Agreement") provides that the Company
shall indemnify and hold harmless each general partner as follows:
(a) In any threatened, pending or completed action, suit or proceeding
to which a general partner or an officer, director, employee or agent of
the Partnership or of a general partner or of National Healthcare
Corporation ("Indemnitee") was or is a party or is threatened to be made a
party or is otherwise involved by reason of the fact that he or it is or
was a general partner of the Company or an officer, director, employee or
agent of the Company or of a general partner or of National Healthcare
Corporation, the Company shall indemnify such Indemnitee to the fullest
extent permitted by law against expenses, including attorney's fees,
judgments and amounts paid in settlement, actually and reasonably incurred
by such Indemnitee in connection with such action, suit or proceeding, if
the Indemnitee acted in good faith and in a manner he or it reasonably
believed to be in or not opposed to the best interests of the Company (or
National Healthcare Corporation as the case may be) and, with respect to
any criminal proceeding, had no reasonable cause to believe that his or its
conduct was unlawful and provided that such Indemnitee's conduct does not
constitute gross negligence, or willful or wanton misconduct. The
termination of any action, suit or proceeding by judgment, order, or
settlement shall not, of itself, create a presumption that such Indemnitee
did not act in good faith and in a manner that he or it reasonably believed
to be in or not opposed to the best interests of the Company or had
reasonable cause to believe that his or its conduct was unlawful. The
indemnification of officers, directors, employees or agents of National
Healthcare Corporation shall be interpreted as an indemnification with
respect to conduct of such an Indemnitee at any time prior to consummation
of the Plan (as defined in the Agreement). Notwithstanding the foregoing,
neither a general partner nor any partner, officer, director, employee or
agent of a general partner or of the Company or of National Healthcare
Corporation shall be indemnified from any liabilities, costs and expenses
incurred by it in connection with any claim or settlement involving
allegations that federal or state securities laws were violated unless
there has been a successful adjudication on the merits as a result of a
trial or such claim has been dismissed with prejudice on the merits by a
court of competent jurisdiction and such indemnification is specifically
approved by a court which shall have been advised as to the current
position of the Securities and Exchange Commission, and the California
Commissioner of Corporations, regarding indemnification for violations of
securities laws.
II-1
<PAGE> 15
(b) Any indemnification pursuant to the above, unless ordered by a
court, shall be made by the Company only as authorized in the specific case
and only upon a determination by independent legal counsel in a written
opinion that indemnification of the Indemnitee is proper in the
circumstances because the Indemnitee has met the applicable standard of
conduct. Any such indemnification shall be made only out of the assets of
the Company. In no event may an Indemnitee subject the limited partners,
the general partners or assignees of same to personal liability by reason
thereof.
(c) The Company may purchase and maintain insurance on behalf of any
general partner (and officers, directors, employees and trustees thereof)
and such other persons as the Managing General Partner shall determine
against liability which may be asserted against or expense which may be
incurred by such person in connection with Company activities whether or
not the Company would have the power to indemnify such person against such
liability under the provisions of the Agreement.
(d) To the fullest extent permitted by law, expenses incurred by an
Indemnitee in defending any claim, demand, action, suit or proceeding
subject to this section shall, from time to time, be advanced by the
Company prior to the final disposition of such claim, demand, action, suit
or proceeding upon receipt by the Company of any undertaking by or on
behalf of the Indemnitee to repay such amount unless it shall be determined
that such person is entitled to be indemnified as authorized in this
Section.
(e) The indemnification provided by this section shall be in addition
to any other rights to which those indemnified may be entitled under any
agreement, vote of the partners of the Company, as a matter of law or
otherwise, both as to an action in the Indemnitee's capacity as a general
partner or as an officer, director, employee or agent of the Company or of
a general partner or National Healthcare Corporation and to an action in
another capacity, and shall continue as to an Indemnitee who has ceased to
serve in such capacity and shall inure to the benefit of the heirs,
successors, assigns and administrators of the Indemnitee. The Managing
General Partner may, with the concurrence of a majority of the Conflict of
Interests Committee (as defined in the Agreement) enter into, on behalf of
the Company, contracts of indemnification with the general partners, which
are not inconsistent with the provisions of this Section.
(f) An Indemnitee shall not be denied indemnification in whole or in
part under this section because the Indemnitee had an interest in the
transaction with respect to which the indemnification applies if the
transaction was otherwise permitted by the terms of the Agreement.
(g) The indemnification provided in this Section is for the benefit of
the Indemnitees and shall not be deemed to create any right to
indemnification for any other persons.
Exculpation. The general partners shall have no liability to the limited
partners for the return of their Capital Contributions (as defined in the
Agreement) or for any loss, damage, liability or expense arising out of the
Agreement or the business of the Company except as caused by gross negligence,
misconduct in the performance of their fiduciary duties to the limited partners,
violation of any of the provisions of the Agreement or as may elsewhere be
expressly provided.
Limitation of Liability. A limited partner shall not be personally liable
for losses or debts of the Company except as provided in the Delaware Revised
Uniform Limited Partnership Act. A limited partner of a partnership may be
required by law to return to such partnership amounts previously distributed to
him as a Return of Capital, as that term is defined in the Agreement. It is the
intent of the partners that no distribution to any limited partner pursuant to
the Agreement shall be deemed a return or withdrawal of capital, even if such
distribution represents, for federal income tax purposes or otherwise (in full
or in part), a distribution of depreciation or any other non-cash item accounted
for as a loss or deduction from or offset to the partnership's income, and that
no limited partner shall be obligated to pay any such amount to or for the
account of the Company or any creditor of the Company. However, if any court of
competent jurisdiction holds that, notwithstanding the provisions of the
Agreement, any limited partner is obligated to make any such payment such
obligation shall be the obligation of such limited partner and not of any
general partner, provided, however, that Company assets must be exhausted before
any limited partner shall be liable for Company obligations.
II-2
<PAGE> 16
Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Securities Act") may be permitted to general or
limited partners or persons controlling the Company pursuant to the foregoing
provisions, the Company has been informed that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in such Securities Act and is therefore unenforceable.
The Placement Agency Agreement provides that the Placement Agent and/or
Selling Securityholder shall indemnify the Company and each of its directors,
officers and partners against certain liabilities, including civil liabilities
under the Securities Act, to the extent and in the circumstances set forth
therein or shall contribute to payments the Company or any of its directors,
officers or partners may be required to make in respect thereof.
ITEM 16. EXHIBITS
<TABLE>
<CAPTION>
EXHIBIT
NUMBER DESCRIPTION
- ------ --------------------------------------------------------------------------------
<C> <C> <S>
1.1 -- Form of Placement Agency Agreement
1.2 -- Form of Escrow Agreement
4.1 -- Restated Articles of Incorporation/ Partnership Agreement (Incorporated by
reference to Exhibit A to the Company's Registration Statement No. 33-9881 on
Form S-4)
4.2 -- Form of Indenture
4.3 -- Form of Debenture
5 -- Opinion of Harwell Howard Hyne Gabbert & Manner, P.C. regarding legality of the
Debentures and Units of the Company
12 -- Statement concerning computation of ratio of earnings to fixed charges
23(a) -- Consent of Arthur Andersen LLP
23(b) -- Consent of Harwell Howard Hyne Gabbert & Manner, P.C. (included in Exhibit 5)
24 -- Power of Attorney (included in signature page)
25 -- Form T-1 Statement of Eligibility and Qualification under the Trust Indenture
Act of 1939
</TABLE>
ITEM 17. UNDERTAKINGS
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;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total 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) if, in the aggregate, the changes in
volume and price represent no more than 20 percent change in the maximum
aggregate offering price set forth in the "Calculation of Registration
Fee" table in the effective registration statement.
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement.
Provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if
the registration statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by
those paragraphs is contained in periodic reports filed with or
furnished to the
II-3
<PAGE> 17
Commission filed by the registrant pursuant to Section 13 or 15(d) of
the Exchange Act that are incorporated by reference in the registration
statement.
(2) That, for the purpose 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.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(4) That, for purposes of determining any liability under the
Securities Act, each filing of the registrant's annual report pursuant to
Section 13(a) or Section 15(d) of the Exchange Act (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Exchange Act) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide
offering thereof.
Insofar as indemnification for liabilities arising under the Securities Act
may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Commission such indemnification is
against public policy as expressed in the Securities 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 director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-4
<PAGE> 18
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as amended, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Murfreesboro, State of Tennessee, on the 25 day of
August, 1995.
NATIONAL HEALTHCARE L.P.
By: /s/ W. Andrew Adams
----------------------
Its: President
---------------------
Each person whose signature to the Registration Statement appears below
hereby appoints W. Andrew Adams and Richard F. LaRoche, Jr., and each of them,
as his attorneys-in-fact to execute in the name and on behalf of any such
person, individually and in the capacity stated below, and to file all
amendments and post-effective amendments to this Registration Statement, which
amendment or amendments may make such changes and additions in this Registration
Statement as such attorneys-in-fact may deem necessary or appropriate.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this Registration Statement has been signed on the dates indicated by the
following persons in the capacities indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
- --------------------------------------------- ------------------------ ---------------------
<C> <S> <C>
/s/ W. ANDREW ADAMS President, Principal August 25, 1995
- --------------------------------------------- Executive and
W. Andrew Adams Financial Officer,
Director of NHC, Inc.
and National
Healthcare Corporation
and Individual General
Partner
/s/ ROBERT G. ADAMS Senior Vice President, August 25, 1995
- --------------------------------------------- Director NHC, Inc. and
Robert G. Adams National Healthcare
Corporation
Director NHC, Inc., and , 1995
- --------------------------------------------- National Healthcare
Olin O. Williams, M.D. Corporation, Corporate
General Partners
Director NHC, Inc., and , 1995
- --------------------------------------------- National Healthcare
J.K. Twilla, M.D. Corporation, Corporate
General Partners
/s/ ERNEST G. BURGESS Director August 25, 1995
- ---------------------------------------------
Ernest G. Burgess
</TABLE>
II-5
<PAGE> 1
EXHIBIT 1.1
August 9, 1995
Equitable Securities Corporation
800 Nashville City Center
Nashville, Tennessee 37219-1743
Re: Placement of Debt Securities
of National HealthCare L.P.
Dear Sirs:
This letter confirms the agreement by and among National HealthCare
L.P. (the "Company") and the 1818 Fund, L.P. and its affiliates (collectively,
the "Covered Noteholder") to retain Equitable Securities Corporation (the
"Placement Agent"), as the exclusive agent for the sale of up to $30,000,000
aggregate principal amount (the "Principal Amount") of the Company's 6.0%
Senior Subordinated Convertible Debentures due 2000 (the "Debentures"),
convertible into limited partnership units of the Company (the "Units"), held
by the Covered Noteholder, to certain investors (collectively, the
"Investors"). The Debentures are to be issued pursuant to an Indenture (the
"Indenture") which will be entered into between the Company and First American
National Bank, as Trustee (the "Trustee"). Copies of the Indenture, in
substantially final form, will be delivered to the Placement Agent, as soon as
practicable. The Debentures and the Units will be more fully described in the
Registration Statement defined below.
The Company and the Covered Noteholder each hereby confirms the above
and the following agreements with the Placement Agent.
1. Agreement to Act as Placement Agent.
(a) On the basis of the representations,
warranties and agreements of the Company and of the Covered Noteholder herein
contained and subject to all the terms and conditions of this Agreement, the
Placement Agent agrees to act as the exclusive placement agent in connection
with the sale, on a best efforts basis, by the Covered Noteholder of the
Debentures to the Investors. The Covered Noteholder shall pay to the Placement
Agent one and one-half percent of the proceeds received by the Covered
Noteholder from the sale of the Debentures as set forth on the cover page of
the Prospectus, as hereinafter defined. In no event will the Placement Agent
<PAGE> 2
commence sales efforts until requested to do so by the Covered Noteholder. The
Placement Agent may, in its sole discretion, retain one or more sub-placement
agents. Any fees and expenses incurred by any sub-placement agent shall be
payable solely by the Placement Agent and neither the Company nor the Covered
Noteholder shall have any liability therefor.
2. Delivery and Payment. On the Take-Down Date (as defined
below), the Covered Noteholder, the Placement Agent and Citibank, N.A., as
escrow agent (the "Escrow Agent"), shall enter into an Escrow Agreement
substantially in the form of Exhibit A attached hereto, pursuant to which an
escrow account will be established, at the Covered Noteholder's expense, for
the benefit of the Investors (the "Escrow Account"). Prior to the Closing Date
(defined below), (i) each of the Investors will deposit an amount equal to the
Principal Amount purchased by it in the Escrow Account, and (ii) the Escrow
Agent will notify the Covered Noteholder and the Placement Agent in writing
whether the Investors have deposited funds in the amount equal to the total
principal amount of Debentures being offered to Investors (the "Requisite
Funds") into the Escrow Account. At such time on such date as may be agreed
upon by the Covered Noteholder and the Placement Agent but in no event prior to
the date on which the Escrow Agent shall have received all of the Requisite
Funds (such date is hereinafter referred to as the "Closing Date"), the Escrow
Agent will release the Requisite Funds from the Escrow Account for collection
by the Covered Noteholder and, to the extent that the Placement Agent has
earned commissions under Section 1 hereof, by the Placement Agent as provided
in the Escrow Agreement and the Covered Noteholder shall deliver the Debentures
to the Investors, which delivery may be made through the facilities of the
Transfer Agent. The Closing (the "Closing") shall take place at the office of
Stroock & Stroock & Lavan, Seven Hanover Square, New York, New York 10004. All
actions taken at the Closing shall be deemed to have occurred simultaneously.
In the event that the Requisite Funds are not deposited into the
Escrow Account prior to the Closing Date, the obligations of the parties hereto
shall terminate in accordance with the provisions of Section 9 of this
Agreement.
Certificates evidencing the Debentures shall be in definitive
form and shall be registered in such names and in such denominations as the
Placement Agent shall request by written notice to the Company. For the
purpose of expediting the checking and packaging of certificates for the
Debentures, the Company agrees to make such certificates available for
inspection at least 24 hours prior to delivery to the Investors.
Reference herein to the "Closing Date" shall be deemed to
refer to each Closing Date with respect to its related Take-
-2-
<PAGE> 3
Down Date. The term "Take-Down Date" means the date on which confirmations
relating to the sale of Debentures by the Covered Noteholder through the
Placement Agent are first issued.
3. Representations and Warranties of the Company. The
Company represents, warrants and covenants to each of the Placement Agent and
the Covered Noteholder, as of the date hereof (unless otherwise indicated
below) and as of the Take-Down Date (defined below), that:
(a) At the Take-Down Date (defined below), the
Company will have filed with the Securities and Exchange Commission (the
"Commission") a "shelf" registration statement on Form S-3 which shall have
been declared effective, relating to up to $30,000,000 principal amount of the
Debentures and the Units into which those Debentures may be converted (the
"Conversion Units"). The Company will have filed, or will promptly file, with
the Commission a supplement to the form of prospectus included in such
registration statement specifically relating to the principal amount of the
Debentures being sold by the Covered Noteholder to Investors, pursuant to Rule
424 under the Securities Act of 1933, as amended (the "Act"). Such
registration statement, as amended at the Take-Down Date (as defined below),
will meet the requirements of Rule 415 under the Act. The Company meets the
requirements for use of Form S-3 under the Act. As used in this Agreement, the
term "Registration Statement" means such registration statement, as amended at
the time it was declared effective by the Commission, including all exhibits,
financial statements, schedules and documents incorporated by reference
therein. The term "Basic Prospectus" means the prospectus included in the
Registration Statement. The term "Prospectus" means the Basic Prospectus
together with the prospectus supplement specifically relating to the Debentures
being sold by the Covered Noteholder to Investors, as filed with the Commission
pursuant to such Rule 424. Any reference herein to the Registration Statement
or the Prospectus shall be deemed to refer to and include the documents
incorporated by reference therein as of the Take-Down Date or the date of the
Prospectus, as the case may be, and any reference herein to any amendment or
supplement to the Registration Statement or the Prospectus shall be deemed to
refer to and include any documents filed after such date and through the date
of such amendment or supplement under the Securities and Exchange Act of 1934,
as amended (the "Exchange Act"), and so incorporated by reference. The
"Effective Date" of the Registration Statement or any amendment to the
Registration Statement shall, if such amendment is effected by means of the
filing with the Commission under the Exchange Act of a document incorporated by
reference in such registration statement, be deemed to refer to the date on
which such document was declared effective by the Commission. Copies of such
Registration Statement and amendments and of the Prospectus
-3-
<PAGE> 4
shall be delivered to each of the Placement Agent and the Covered Noteholder,
as soon as practicable. The Company has not distributed and will not
distribute any offering material in connection with the offering or sale of the
Debentures other than the Registration Statement, the Prospectus or any other
materials, if any, permitted by the Act.
(b) When the Registration Statement or any
amendment thereto is declared effective, at the Take-Down Date, and at the time
any amendment to the Registration Statement filed through the Closing Date
becomes effective (including the filing of any document incorporated by
reference in the Registration Statement), the Registration Statement (i) will
meet the requirements set forth in Rule 415(a)(i) under the Act and will comply
in all material respects with said Rule, (ii) will contain all statements
required to be stated therein in accordance with, and will comply in all
material respects with the requirements of the Act, the Exchange Act and the
respective rules and regulations of the Commission thereunder and (iii) will
not include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light of the
circumstance under which they were made, not misleading; provided, however,
that the representations and warranties in this subsection shall not apply to
statements in or omissions from the Registration Statement or the Prospectus
made in reliance upon and in conformity with the information furnished to the
Company in writing by the Placement Agent or by the Covered Noteholder
expressly for use and used therein.
(c) The Company and each of its direct and
indirect subsidiaries (the "Subsidiaries") is, and at each of the Take-Down
Date and the Closing Date will be, duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization. The Company and
each of its Subsidiaries has, and at each of the Take-Down Date and the Closing
Date will have, full partnership or corporate power and authority to conduct
all the activities conducted by it, to own or lease all the assets owned or
leased by it and to conduct its business as described in the Company's Annual
Report on Form 10-K for the year ended December 31, 1994 (the "1994 10-K") to
be incorporated by reference into the Registration Statement and the
Prospectus. The Company and each of the Subsidiaries is, and at each of the
Take-Down Date and the Closing Date will be, duly licensed or qualified to do
business and in good standing as a foreign organization in all jurisdictions in
which the nature of the activities conducted by it or the character of the
assets owned or leased by it makes such licensing or qualification necessary,
except where such failure to qualify would not have a material adverse effect
on the Company and its Subsidiaries, taken as a whole. The issued shares of
capital stock of each of the Subsidiaries have been duly authorized and
-4-
<PAGE> 5
validly issued, are fully paid and nonassessable and are owned beneficially by
the Company free and clear of any security interests, liens, encumbrances,
equities or claims, except as disclosed in the 1994 10-K. Complete and correct
copies of the Company's Amended and Restated Agreement of Limited Partnership
and of any other organizational documents of the Company and the organizational
documents of each of its subsidiaries and all amendments thereto have been made
available (and will be delivered) to the Placement Agent to, and no changes
therein will be made subsequent to the date hereof and prior to the Closing
Date.
(d) The outstanding Units of the Company have
been duly authorized and are fully paid and non-assessable. The Company has an
authorized, issued and outstanding capitalization as set forth in the
Prospectus (or, if the Prospectus is not in existence, in the 1994 10-K). The
Conversion Units are duly authorized, and, when issued, will be fully paid and
non-assessable. The description of the Company's Units contained in the
Registration Statement and the Prospectus (or, if the Prospectus is not in
existence, in the 1994 10-K) is, and at the Closing Date will be, complete and
accurate in all respects. Except as set forth in the Registration Statement
and the Prospectus (or, if the Prospectus is not in existence, in the 1994
10-K) and, except as relates to the Company's Employee Unit Purchase Plan, (i)
the Company does not have outstanding, and at the Closing Date will not have
outstanding, any options to purchase, or any rights or warrants to subscribe
for, or any securities or obligations convertible into, or any contracts or
commitments to issue or sell, any Units or other securities of the Company, any
shares of capital stock or partnership interests of any Subsidiary or any such
warrants, convertible securities or obligations; and (ii) there are no
restrictions on the transfer of Conversion Units.
(e) As of the Take-Down Date, the Debentures will
be duly authorized, and when the Indenture has been duly executed and delivered
by the Company and the Trustee, and the Debentures have been duly executed by
the Company and authenticated by the Trustee, (i) the Debentures will
constitute valid and legally binding obligations of the Company enforceable
against it in accordance with their terms, (ii) the Debentures will be
convertible into Units in accordance with the terms of the Indenture, and (iii)
the Debentures will conform to the description thereof contained in the
Prospectus.
(f) As of the Take-Down Date, the Indenture has
been duly authorized and has been duly qualified under the Trust Indenture Act
of 1939, as amended (the "Trust Indenture Act"), and when the Indenture has
been duly executed and delivered by the Company and the Trustee, the Indenture
will constitute a
-5-
<PAGE> 6
valid and legally binding instrument of the Company, enforceable against the
Company in accordance with its terms.
(g) The consolidated financial statements and the
related notes and schedules included in the 1994 10-K and incorporated by
reference into the Registration Statement and the Prospectus present fairly the
financial condition of (i) the Company as of the date thereof and the
consolidated results of operations, partners' capital and cash flows of the
Company at the dates and for the periods covered thereby, all in conformity
with generally accepted accounting principles ("GAAP") applied on a consistent
basis throughout the entire period involved, except as otherwise disclosed
therein. No other financial statements or schedules of the Company, its
Subsidiaries or any other entity are required by the Act or the Rules and
Regulations to be included in the Registration Statement or the Prospectus.
Arthur Andersen & Co. (the "Accountants"), who have reported on such financial
statements and schedules, are independent accountants with respect to the
Company and its Subsidiaries as required by the Act and the Rules and
Regulations. The statements incorporated by reference into the Registration
Statement from the 1994 10-K with respect to the Accountants pursuant to Rule
509 of Regulation S-K of the Rules and Regulations are true and correct in all
material respects. The financial statements of the Company and the related
notes and schedules included in the Registration Statement and the Prospectus
(or, if the Prospectus is not in existence, in the 1994 10-K), have been
prepared in conformity with the requirements of the Act and the Rules and
Regulations and present fairly the information shown therein.
(h) The Company and its Subsidiaries maintain a
system of internal accounting controls sufficient to provide reasonable
assurance that (i) transactions are executed in accordance with management's
general or specific authorization; (ii) transactions are recorded as necessary
to permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain accountability for assets; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with existing assets at reasonable intervals and appropriate action is
taken with respect to any differences.
(i) As of the date hereof and subsequent to the
respective dates as of which information is given in the Registration Statement
and the Prospectus and prior to the Closing Date, except as set forth in or
contemplated by the Registration Statement and the Prospectus (or in the 1994
10-K), (i) there has not been and will not have been any change in the
capitalization of the Company other than insignificant changes in the ordinary
course of business, or any material adverse
-6-
<PAGE> 7
change in the business, properties, business prospects, condition (financial or
otherwise) or results of operations of the Company and its Subsidiaries, taken
as a whole, arising for any reason whatsoever, (ii) neither the Company nor any
of its Subsidiaries has incurred nor will it incur any material liabilities or
obligations, direct or contingent, nor has the Company or any of its
Subsidiaries entered into will enter into any material transactions other than
pursuant to this Agreement, the Registration Statement and the transactions
referred to herein and therein.
(j) Each of the Company and its Subsidiaries has
good and indefeasible title in fee simple to all real property and interests in
real property owned by it, in each case free and clear of all liens,
encumbrances and defects except such as will be described in the Registration
Statement (or in the 1994 10-K) or such as do not adversely affect the value of
such property or interests and do not interfere with the use made or proposed
to be made of such property or interests by it; each of the Company and its
Subsidiaries has obtained satisfactory confirmations, except as will be
otherwise described in the Registration Statement, (A) that it has the
foregoing title to such real property and interests in real property, and (B)
that the instruments securing its real estate mortgage loans create valid liens
upon the real properties described in such instruments enjoying the priorities
intended, subject only to exceptions to title which have no adverse effect on
the value of such real properties and interests; and any real property and
buildings held under lease by the Company or any of its Subsidiaries or leased
by the Company or any of its Subsidiaries to a third party are held or leased
by them under valid, binding and enforceable leases conforming to the
description thereof set forth in the Registration Statement and the Prospectus
(or, if the Prospectus is not in existence, in the 1994 10-K), with such
exceptions as do not interfere with the use made and proposed to be made of
such property and buildings by them or any third party.
(k) The Company has no actual knowledge of (i)
the presence of any hazardous substances, hazardous materials, toxic substances
or waste materials (collectively, "Hazardous Materials"), the existence of
which is a material violation of any environmental law or regulation, on any of
the properties owned by it or any of the Subsidiaries, or (ii) any spills,
releases, discharges or disposal of Hazardous Materials that have occurred or
are presently occurring off such properties as a result of any construction on
or operation and use of such properties other than those having occurred or
occurring in compliance with all applicable environmental laws except, with
respect to (i) and (ii), as may otherwise be set forth in environmental reports
(the "Reports") obtained by the Company or any of its Subsidiaries. With
respect to the
-7-
<PAGE> 8
construction on or operation and use of the properties owned by the Company or
any of its Subsidiaries, the Company represents that it has no actual knowledge
of any material failure to comply with all applicable local, state and federal
environmental laws, regulations, ordinances and administrative and judicial
orders relating to the generation, recycling, reuse, sale, storage, handling,
transport and disposal of any Hazardous Materials, or relating to occupational
safety and health, or pollution, or protection of health. Except as disclosed
in the Prospectus (or, if the Prospectus is not in existence, in the 1994
10-K), none of the Company or its Subsidiaries has received any notice from any
governmental instrumentality or any third party alleging any material violation
thereof or liability thereunder (including, without limitation liability for
costs of investigating or remediating sites containing Hazardous Materials
and/or damage to natural resources) which would be reasonably likely to have a
materially adverse effect on the Company and its Subsidiaries taken as a whole.
(l) Neither the Company nor any person
controlling the Company is an "investment company" within the meaning of the
Investment Company Act of 1940, as amended (the "Investment Company Act").
(m) As of each date hereof and the Take-Down
Date, and except as set forth in the Registration Statement and the Prospectus
(or, if the Prospectus is not in existence, in the 1994 10-K), there are no
actions, suits or proceedings pending or threatened, to the Company's
knowledge, against or affecting the Company or any of its Subsidiaries or any
of their respective officers in their capacity as such, before or by any
Federal or state court, commission, regulatory body, administrative agency or
other governmental body, domestic or foreign, wherein an unfavorable ruling,
decision or finding is reasonably expected to materially adversely affect the
business, properties, prospects, condition (financial or otherwise) or results
of operations of the Company and its Subsidiaries taken as a whole.
(n) Each of the Company and its Subsidiaries has,
and at the Closing Date will have, (i) all governmental licenses, permits,
consents, orders, approvals and other authorizations necessary to carry on its
business as contemplated in the 1994 10-K, (ii) complied in all material
respects with all laws, regulations and orders applicable to it or its business
and (iii) performed all its obligations required to be performed by it, and is
not, and at the Closing Date will not, to the Company's best knowledge, be in
default, under any indenture, mortgage, deed of trust, voting trust agreement,
loan agreement, bond, debenture, note agreement, lease, contract or other
agreement or instrument (collectively, a "contract or
-8-
<PAGE> 9
other agreement") to which it is a party or by which its property is bound or
affected, except where such violations or defaults would not have a material
adverse effect on the Company and its subsidiaries taken as a whole and any
such exceptions as are otherwise set forth in the Registration Statement and
the Prospectus (or, if the Prospectus is not in existence, in the 1994 10-K).
To the best knowledge of the Company and each of its Subsidiaries, no other
party under any contract or other agreement to which it is a party is in
default in any respect thereunder. Neither the Company nor any of its
Subsidiaries is in violation of any provision of its organizational or
governing documents.
(o) The Company has full power and authority to
enter into this Agreement. This Agreement has been duly authorized, executed
and delivered by the Company and constitutes a valid and binding agreement of
the Company and is enforceable against the Company in accordance with the terms
hereof. The issuance, offering and sale of the Debentures pursuant to this
Agreement, the issuance of the Conversion Units the compliance by the Company
with the provisions of this Agreement, the Debentures and the Indenture and the
consummation of the other transactions herein contemplated will not result in
the creation or imposition of any lien, charge or encumbrance upon any of the
assets of the Company or any of its Subsidiaries pursuant to the terms or
provisions of, or result in a breach or violation of or conflict with any of
the terms or provisions of, or constitute a default under, or give any other
party a right to terminate any of its obligations under, or result in the
acceleration of any obligation under, (i) the organizational and governing
documents of the Company or any of its Subsidiaries, or (ii) any contract or
other agreement to which the Company or any of its Subsidiaries is a party or
by which the Company or any of its Subsidiaries or any of their respective
properties are bound or affected, or any judgment, ruling, decree, order,
statute, rule or regulation of any court or other governmental agency or body
applicable to the business or properties of the Company or any of its
Subsidiaries except where such violation would not have a material adverse
effect on the Company and its Subsidiaries taken as a whole.
(p) No statement, representation, warranty or
covenant made by the Company in this Agreement or made in any certificate or
document required by this Agreement to be delivered to the Placement Agent or
to the Covered Noteholder was or will be, when made, inaccurate, untrue or
incorrect in any material respect.
(q) Neither the Company nor any of its directors,
officers or controlling persons has taken, directly or indirectly, any action
intended, or which might reasonably be expected, to cause or result, under the
Act or otherwise, in, or
-9-
<PAGE> 10
which has constituted, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the Debentures.
(r) No holder of securities of the Company has
rights to the registration of any securities of the Company as a result of the
filing of the Registration Statement.
(s) Neither the Company nor any of its
Subsidiaries is involved in any material labor dispute or, to the knowledge of
the Company, is any such dispute threatened.
(t) None of the Company, any of its Subsidiaries
or, to the Company's knowledge, any employee or agent of the Company or any
Subsidiary has made any payment of funds of the Company or any Subsidiary or
received or retained any funds in violation of any law, rule or regulation or
of a character required to be disclosed in the Prospectus (or, if the
Prospectus is not in existence, in the 1994-K).
(u) The Company and its Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are customary in the businesses in which they are
engaged; and none of the Company or any of its Subsidiaries has been refused
any insurance coverage sought or applied for; and none of the Company or any of
its Subsidiaries has any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage expires or to obtain
similar coverage from similar insurers as may be necessary to continue its
business at a cost that would not materially adversely affect the Company or
any of its Subsidiaries or their business, properties, prospects, condition
(financial or otherwise) or results of operations.
(v) The issuance of the Conversion Units, the
compliance by the Company with the other provisions of this Agreement, the
Debentures and the Indenture and the consummation of the other transactions
herein contemplated do not require the consent, approval, authorization,
registration or qualification of or with any governmental authority, except
such as have been obtained under the Act or the Rules and Regulations, such as
may be required under state securities or Blue Sky laws or the by-laws and
rules of the National Association of Securities Dealers, Inc. (the "NASD") and,
if the Registration Statement is not effective under the Act as of the time of
execution hereof, such as may be required (and shall be obtained as provided in
this Agreement) under the Act.
4. Representations and Warranties of the Covered Noteholder
The Covered Noteholder represents, warrants and covenants to the Placement
Agent and the Company, as of the date hereof and as of the Take-Down Date,
that:
-10-
<PAGE> 11
(a) Such Covered Noteholder has full power and authority
to enter into each of this Agreement and the Escrow Agreement. All
authorizations and consents necessary for the execution of the transactions
contemplated hereby have been obtained. Each of this Agreement and the Escrow
Agreement has been duly authorized, executed and delivered by or on behalf of
such Covered Noteholder and constitutes a valid and binding agreement of such
Covered Noteholder and is enforceable against such Covered Noteholder in
accordance with its terms.
(b) Such Covered Noteholder now has, and at the time of
delivery thereof hereunder will have, (i) good and marketable title to the
Debentures to be sold by such Covered Noteholder hereunder, free and clear of
all security interests, pledges, liens, encumbrances, equities, charges and
claims whatsoever, and (ii) full legal right and power, and all authorizations
and approvals required by law, to sell, transfer and deliver the Debentures to
the Investors and to make the representations, warranties and agreements made
by such Covered Noteholder herein. Upon the delivery of and payment for the
Debentures hereunder, and assuming that no Investor has notice of an adverse
claim, as defined in the Uniform Commercial Code of New York State, the
Investors will receive good and marketable title thereto, free and clear of all
security interests, pledges, liens, encumbrances, equities, charges and claims
whatsoever.
(c) All information with respect to such Covered
Noteholder furnished in writing by the Covered Noteholder to the Company for
inclusion in, and contained in, the Registration Statement and the Prospectus
(as amended or supplemented, if the Company shall have filed with the
Commission any amendment or supplement thereto) will comply with all applicable
provisions of the Act and the Rules and Regulations, and will contain all
statements required to be stated therein in accordance with the Act and the
Rules and Regulations, and will not contain any untrue statement of a material
fact or omit to state a material fact regarding such Covered Noteholder
required to be stated therein or necessary in order to make the statements
therein regarding such Covered Noteholder not misleading.
(d) Any certificate signed by or on behalf of such
Covered Noteholder and delivered to the Placement Agent or to counsel for the
Placement Agent shall be deemed a representation and warranty by such Covered
Noteholder to the Placement Agent as to the matters covered thereby.
5. Agreements of the Company. The Company covenants and
agrees with each of the Placement Agent and the Covered Noteholder as follows:
(a) The Company will not, either prior to the
Take-Down Date or thereafter during such period as the
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<PAGE> 12
Prospectus would be required by law to be delivered in connection with sales of
the Debentures by the Placement Agent pursuant to this Agreement, file any
amendment or supplement to the Registration Statement or the Prospectus, unless
a copy thereof shall first have been submitted to the Placement Agent and the
Covered Noteholder within a reasonable period of time prior to the filing
thereof and the Placement Agent and the Covered Noteholder shall not have
objected thereto in good faith.
(b) The Company will use its best efforts to
cause the Registration Statement to become effective, and will notify the
Placement Agent and the Covered Noteholder promptly, and will confirm such
advice in writing, (1) when the Registration Statement has become effective and
when any post-effective amendment thereto becomes effective, (2) of any request
by the Commission for amendments or supplements to the Registration Statement
or the Prospectus or for additional information, (3) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose or the threat
thereof, (4) of the happening of any event during the period mentioned in
Section 5(a) hereof that in the judgment of the Company makes any statement
made in the Registration Statement or the Prospectus untrue or that requires
the making of any changes in the Registration Statement or the Prospectus in
order to make the statements therein, in light of the circumstances in which
they are made, not misleading and (5) of receipt by the Company or any
representative or attorney of the Company or any other communication from the
Commission relating to the any of them, the Registration Statement, any
amendment thereto or the Prospectus. If at any time the Commission shall issue
any order suspending the effectiveness of the Registration Statement, the
Company will make every reasonable effort to obtain the withdrawal of such
order at the earliest possible moment.
(c) The Company will furnish to each of the
Placement Agent, and its counsel, and to the Covered Noteholder, and its
counsel, without charge, (i) two signed copies of the Registration Statement
and of any post-effective amendment thereto, including financial statements and
schedules, and all exhibits thereto and (ii) during the period described in
Section 5(a) hereof, as many copies of each Preliminary Prospectus or the
Prospectus or any amendment or supplement thereto as the Placement Agent and
the Covered Noteholder may reasonably request.
(d) The Company will comply with all the
provisions of any undertakings contained in the Registration Statement.
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<PAGE> 13
(e) The Company consents to the use of the
Prospectus or any amendment or supplement thereto by the Placement Agent. If,
at any time during the period described in Section 5(a) any event occurs which
in the reasonable judgment of the Company or counsel to the Placement Agent, or
counsel to the Covered Noteholder should be set forth in the Prospectus, as
then amended or supplemented, in order to make any statement therein, in the
light of the circumstances under which it was made, not misleading, or in the
Registration Statement, as then amended, or supplemented, in order to make any
statement therein not misleading, or if it is necessary to supplement or amend
the Prospectus or the Registration Statement to comply with law, the Company
will forthwith prepare and duly file with the Commission an appropriate
supplement or amendment thereto, and will deliver to the Placement Agent and
the Covered Noteholder, without charge, such number of copies thereof as the
Placement Agent and/or the Covered Noteholder may reasonably request.
(f) Prior to the sale of the Debentures to the
Investors, the Company will cooperate with the Placement Agent and its counsel
in connection with the registration or qualification of the Debentures for
offer and sale under the state securities or Blue Sky laws of such
jurisdictions as the Placement Agent may reasonably request; provided, that in
no event shall the Company be obligated to qualify to do business in any
jurisdiction where it is not now so qualified or to take any action which would
subject it to general service of process in any jurisdiction where it is not
now so subject.
(g) The Company will make generally available to
holders of its securities, as soon as may be practicable a consolidated
earnings statement (which need not be audited but shall be in reasonable
detail) satisfying the provisions of Section 11(a) of the Act (including Rule
158 of the Rules and Regulations).
(h) The Company will not at any time, directly or
indirectly, take any action intended, or which might reasonably be expected, to
cause or result in, or which will constitute, stabilization of the price of the
Debentures to facilitate the sale or resale of any of the Debentures.
(i) The Company will at all times reserve and
keep available, free from preemptive rights, out of its authorized
capitalization, solely for the purpose of issuance upon conversion of the
Debentures, such number of Units as shall then be issuable upon conversion of
all Debentures.
6. Expenses. Whether or not the transactions contemplated by
this Agreement are consummated or this Agreement is terminated, the Company
will pay, or reimburse if paid by the Placement Agent, all costs and expenses
incident to the
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<PAGE> 14
performance of the obligations of the Company under this Agreement, including
but not limited to costs and expenses of or relating to (1) the preparation,
printing and filing of the Registration Statement and exhibits thereto, each
Preliminary Prospectus, the Prospectus and any amendment or supplement to the
Registration Statement or the Prospectus, including all fees, disbursements and
other charges of counsel to the Company, (2) the preparation and delivery of
certificates representing the Debentures, (3) furnishing (including costs of
shipping and mailing) such copies of the Registration Statement, the
Prospectus, and all amendments and supplements thereto, as may be reasonably
requested for use in connection with the direct placement of the Debentures,
(4) the Trustee and any paying agent or conversion agent; and (5) the transfer
agent for the Conversion Units.
The Company will pay (1) the fees and expenses in connection
with any filings required to be made by the Placement Agent with the NASD, and
the fees, disbursements and other charges of counsel for the Placement Agent in
connection therewith, (2) the costs of the registration or qualification of the
Debentures for offer and sale under the securities or Blue Sky laws of such
jurisdictions designated pursuant to Section 5(f) hereof, including the
reasonable fees, disbursements and other charges of counsel to the Placement
Agent in connection therewith, and the preparation and printing of preliminary,
supplemental and final Blue Sky memoranda, (3) fees and expenses of counsel to
the Company. The Covered Noteholder shall reimburse the Placement Agent, on a
fully accountable basis, for all travel, legal and other out-of-pocket expenses
(including any escrow fees) incurred in connection with the engagement
hereunder, up to a maximum of $100,000.
7. Conditions of the Obligations of the Placement Agent. The
obligations of the Placement Agent hereunder are subject to the following
conditions:
(a) Notification that the Registration Statement
has become effective shall be received by the Placement Agent not later than
5:00 p.m., New York City time, on the date of the Prospectus or at such later
date and time as shall be consented to in writing by the Placement Agent and
all filings required by Rule 424 of the Rules and Regulations shall have been
made.
(b) As of the Closing Date (i) no stop order
suspending the effectiveness of the Registration Statement shall have been
issued and no proceedings for that purpose shall be pending or threatened, to
the Company's knowledge, by the Commission, (ii) no order suspending the
effectiveness of the Registration Statement or the qualification or
registration of the Debentures under the securities or Blue Sky laws of any
jurisdiction shall be in effect and no proceeding for such
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<PAGE> 15
purpose shall be pending before or threatened or contemplated, to the Company's
knowledge, by the Commission or the authorities of any such jurisdiction, (iii)
any request for additional information on the part of the staff of the
Commission or any such authorities shall have been complied with to the
satisfaction of the staff of the Commission or such authorities and (iv) after
the Take-Down Date no amendment or supplement to the Registration Statement or
the Prospectus shall have been filed relating to sales undertaken by the
Covered Noteholder through the Placement Agent unless a copy thereof was first
submitted to the Placement Agent and the Placement Agent did not object thereto
in good faith, and (v) the Placement Agent shall have received certificates,
dated the Closing Date and signed by the Chief Executive Officer or the
Chairman of the Board of Directors of the Company, the Chief Financial Officer
or the Vice President and Controller of the Company (who may, as to proceedings
threatened, rely upon the best of their information and belief), to the effect
of clauses (i), (ii) and (iii).
(c) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, (i)
there shall not have been a material adverse change in the general affairs,
business, business prospects, properties, management, condition (financial or
otherwise) or results of operations of the Company and its Subsidiaries, taken
as a whole, whether or not arising from transactions in the ordinary course of
business, in each case other than as set forth in or contemplated by the
Registration Statement and the Prospectus and (ii) neither the Company nor any
of its Subsidiaries shall have sustained any material loss or interference with
its business or properties from fire, explosion, flood or other casualty,
whether or not covered by insurance, or from any labor dispute or any court or
legislative or other governmental action, order or decree, which is not set
forth in the Registration Statement and the Prospectus, if in the judgment of
the Placement Agent any such development makes it impracticable or inadvisable
to consummate the sale and delivery of the Debentures to Investors at the
initial public offering price.
(d) Since the respective dates as of which
information is given in the Registration Statement and the Prospectus, there
shall have been no litigation or other proceeding instituted against the
Company or any of its Subsidiaries or any of their respective officers or
directors in their capacities as such, before or by any Federal, state or local
court, commission, regulatory body, administrative agency or other governmental
body, domestic or foreign, in which litigation or proceeding an unfavorable
ruling, decision or finding is reasonably expected to materially and adversely
affect the business, properties, business prospects, condition
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<PAGE> 16
(financial or otherwise) or results of operations of the Company and its
Subsidiaries, taken as a whole.
(e) Each of the representations and warranties of
the Company contained herein shall be true and correct in all material respects
at the Closing Date, as if made on such date, and all covenants and agreements
herein contained to be performed on the part of the Company and all conditions
herein contained to be fulfilled or complied with by the Company at or prior to
the Closing Date shall have been duly performed, fulfilled or complied with.
(f) The Placement Agent and the Covered
Noteholder shall have received an opinion, dated the Closing Date, of Harwell,
Howard, Hyne, Gabbert & Manner, P.C., counsel for the Company, to the effect
that:
(i) each of the Company and its Subsidiaries
has been duly organized and is validly existing in good standing under
the laws of its jurisdiction of organization and is duly qualified to
transact business as a foreign organization and is in good standing
under the laws of all other jurisdictions in which, to counsel's
knowledge, the ownership or leasing of its properties or the conduct
of its business requires such qualification, except where the failure
to be so qualified does not amount to a material liability or
disability to the Company and the Subsidiaries, taken as a whole;
(ii) each of the Company and its Subsidiaries
has the partnership or corporate power to own or lease its properties
and conduct its business as described in the Registration Statement
and the Prospectus, and the Company has the partnership power to enter
into this Agreement and to carry out all the terms and provisions
hereof to be carried out by it;
(iii) the Company has an authorized
capitalization as set forth in the Prospectus; the issued and
outstanding Units have been duly authorized and validly issued and are
fully paid and non- assessable; the Debentures have been duly
authorized by all necessary partnership action of the Company and,
when issued by the Company and authenticated by the Trustee, will be
validly issued and outstanding; the Conversion Units are duly
authorized and, when issued in accordance with the terms of the
Debentures, will be fully paid and non-assessable; to counsel's
knowledge no holders of outstanding securities of the Company are
entitled as such to any preemptive or other rights to subscribe for
any of the Debentures or any Conversion Units; to such counsel's
knowledge no holders of securities of the Company are entitled to have
such
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<PAGE> 17
securities registered under the Registration Statement; and there are
no restrictions on the transfer of Conversion Units.
(iv) the description of the Debentures, the
Indenture and the Units included in or incorporated by reference into
the Registration Statement from the 1994 10-K, insofar as such
statements purport to summarize certain provisions of the Units, the
Debentures or Indenture, as the case may be, provide a fair summary of
such provisions;
(v) the execution and delivery of this
Agreement has been duly authorized by all necessary partnership action
of the Company and this Agreement has been duly executed and delivered
by the Company, and is the valid and binding agreement of the Company
enforceable against the Company in accordance with its terms, subject,
as to enforcement, to bankruptcy, insolvency, reorganization and other
laws of general applicability relating to or affecting creditors'
rights and to general principles of equity and except as rights to
indemnity and contribution may be limited by federal or state
securities laws or the public policy underlying such laws;
(vi) to such counsel's knowledge, no legal or
governmental proceedings are pending to which the Company or any of
its Subsidiaries is a party or to which the property of the Company or
any of its Subsidiaries is subject that are required to be described
in the Registration Statement or the Prospectus and are not described
therein, and, to the best knowledge of such counsel, no such
proceedings have been threatened against the Company or any of its
Subsidiaries or with respect to any of their respective properties;
(vii) the Registration Statement is effective
under the Act; any required filing of the Prospectus pursuant to Rule
424(b) has been made in the manner and within the time period required
by Rule 424(b); and, to such counsel's knowledge after due inquiry, no
stop order suspending the effectiveness of the Registration Statement
or any post-effective amendment thereto and no order directed at any
amendment or supplement thereto has been issued, and no proceedings
for that purpose have been instituted or threatened or are
contemplated by the Commission;
(viii) none of the Company, its subsidiaries or
any person controlling the Company or its subsidiaries is an
"investment company" within the meaning of the
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<PAGE> 18
Investment Company Act, and is not required to be registered under the
Investment Company Act;
(ix) the statements set forth in the
Prospectus concerning material risk factors, describing the Company's
business and properties, and the Federal income tax considerations to
Investors of purchasing Debentures insofar as such statements
constitute matters of law or legal conclusions, have been reviewed by
such counsel and are accurate in all material respects;
(x) the Registration Statement originally filed
with respect to the Debentures and the Conversion Units and each
amendment thereto and the Prospectus (in each case, not including the
financial statements and other financial and statistical information
contained therein, as to which such counsel need express no opinion)
comply as to form in all material respects with the applicable
requirements of the Act and the respective rules and regulations of
the Commission thereunder;
(xi) the Indenture has been duly authorized and
has been duly qualified under the Trust Indenture Act, the Indenture
constitutes a valid and legally binding instrument, enforceable
against the Company in accordance with its terms; and
(xii) the issuance of the Conversion Units, the
compliance by the Company with the other provisions of this Agreement,
the Indenture and the Debentures, and the consummation of the other
transactions herein contemplated do not (A) require the consent,
approval, authorization, registration or qualification of or with any
governmental authority, except such as have been obtained and such as
may be required under state securities or Blue Sky laws, or (B) to
such counsel's knowledge, conflict with or result in a breach or
violation of any of the terms and provisions of, or constitute a
default under any statute or any judgment, decree, order, rule or
regulation of any court or other governmental authority or any
arbitrator known to such counsel and applicable to the Company or any
of its Subsidiaries.
Such counsel shall also state that in the course of the
preparation of the Registration Statement and the Prospectus, such counsel has
participated in conferences with officers and representatives of the Company
and with the independent public accountants of the Company, at which
conferences the contents of the Registration Statement and the Prospectus were
discussed and, on the basis of the foregoing, that they have no reason to
believe that the Registration Statement, as of its effective date and as of the
date of such
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<PAGE> 19
opinion, contained or contains any untrue statement of a material fact or
omitted or omits to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or that the Prospectus,
as of its date or the date of such opinion, included or includes any untrue
statement of a material fact or omitted or omits to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
In rendering any such opinion, such counsel may rely, as to
matters of fact, to the extent such counsel deems proper, on certificates of
responsible officers of the Company and public officials and, as to matters
involving the application of laws of any jurisdictions in which such counsel
are not admitted to practice, to the extent satisfactory in form and scope to
counsel for the Placement Agent, upon the opinion of local counsel. The
foregoing opinion shall also state that the Placement Agent and the Trustee are
justified in relying upon such opinions of local counsel, and copies of such
opinions shall be delivered to the Placement Agent, the Trustee and their
counsel.
References to the Registration Statement and the Prospectus in
this paragraph (f) shall include any amendment or supplement thereto at the
date of such opinion.
(g) The Placement Agent and the Covered
Noteholder shall have received an opinion, dated the Closing Date, of Richard
F. LaRoche, Jr., General Counsel to the Company, to the effect that:
(i) no default exists, and no event has
occurred which, with notice or lapse of time or both, would constitute
a default in the due performance and observance of any term, covenant
or condition of any indenture, mortgage, deed of trust, lease or other
agreement or instrument to which the Company or any of its
Subsidiaries is a party or by which the Company or any of its
Subsidiaries or any of their respective properties is bound or may be
affected, in any material adverse respect with regard to property,
business or operations of the Company and its Subsidiaries taken as a
whole;
(ii) the issuance of the Conversion Units,
the compliance by the Company with the other provisions of this
Agreement, the Indenture and the Debentures, and the consummation of
the other transactions herein contemplated do not conflict with or
result in a breach or violation of any of the terms and provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
lease or other agreement or instrument to which the Company or any
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<PAGE> 20
of the Subsidiaries is a party or by which the Company or any of the
Subsidiaries or any of their respective properties are bound, or the
organizational or governing documents of the Company or any of the
Subsidiaries;
(iii) no legal or governmental proceedings are
pending to which the Company or any of its Subsidiaries is a party or
to which the property of the Company or any of its Subsidiaries is
subject that are required to be described in the Registration
Statement or the Prospectus and are not described therein, and, no
such proceedings have been threatened against the Company or any of
its Subsidiaries or with respect to any of their respective
properties;
(h) On the date of the Prospectus, the
Accountants shall have furnished to the Placement Agent and the Covered
Noteholder a letter, dated the date of its delivery, addressed to the Placement
Agent and the Covered Noteholder and in form and substance satisfactory to the
Placement Agent and the Covered Noteholder, confirming that they are
independent accountants with respect to (i) the Company and its Subsidiaries as
required by the Act and the Rules and Regulations and (ii) the financial and
other statistical and numerical information contained in the Registration
Statement. At the Closing Date each of the Accountants shall have furnished to
the Placement Agent a letter, dated the date of its delivery, which shall
confirm, on the basis of a review in accordance with the procedures set forth
in the letter from Accountants, that nothing has come to their attention during
the period from the date of the letter referred to in the prior sentence to a
date (specified in the letter) not more than five days prior to the Closing
Date which would require any change in their letter dated the date hereof if it
were required to be dated and delivered at the Closing Date.
(i) On each of the Take-Down Date and the Closing
Date, there shall be furnished to the Placement Agent and the Covered
Noteholder a certificate, dated the date of its delivery, signed by each of the
Chief Executive Officer and the Principal Financial and Accounting Officer of
the Company, in form and substance satisfactory to the Placement Agent to the
effect that:
(i) Each signer of such certificate has
carefully examined the Registration Statement and the Prospectus and
(A) as of the date of such certificate, (x) the Registration Statement
does not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in
order to make the statements therein not misleading and (y) the
Prospectus does not contain any untrue statement of a
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<PAGE> 21
material fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading and
for such certificate issued on the Closing Date, that (B) since the
Take-Down Date no event has occurred as a result of which it is
necessary to amend or supplement the Prospectus in order to make the
statements therein not untrue or misleading in any material respect.
(ii) Each of the representations and warranties
of the Company contained in this Agreement were, when originally
applicable, and are, at the time such certificate is delivered, true
and correct in all material respects.
(iii) Each of the covenants required herein to be
performed by the Company on or prior to the date of such certificate
has been duly, timely and fully performed and each condition herein
required to be complied with by the Company on or prior to the
delivery of such certificate has been duly, timely and fully complied
with.
(iv) No stop order suspending the effectiveness
of the Registration Statement or any post-effective amendment thereto
or the Prospectus has been issued, and no proceedings for that purpose
have been instituted or threatened or, to the best of such officers'
knowledge, are contemplated by the Commission.
(j) As of the Closing Date, the Debentures shall
be qualified for sale in such states as the Placement Agent may reasonably
request, each such qualification shall be in effect and not subject to any stop
order or other proceeding on the Closing Date.
(k) The Company shall have furnished to the
Placement Agent and the Covered Noteholder such certificates, in addition to
those specifically mentioned herein, as the Placement Agent and the Covered
Noteholder may have reasonably requested as to the accuracy and completeness at
the Closing Date of any statement in the Registration Statement or the
Prospectus as to the accuracy at the Closing Date of the representations and
warranties of the Company as to the performance by the Company of its
obligations hereunder, or as to the fulfillment of the conditions concurrent
and precedent to the obligations hereunder of the Placement Agent.
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<PAGE> 22
(l) The Covered Noteholder will enter into an
agreement with the Placement Agent, subject to the Placement Agent's waiver, in
the form of Attachment A hereto to the effect that it will not, directly or
indirectly, offer, sell, distribute or otherwise dispose of any Debentures for
a period of 90 days following a Closing with respect to $15 million or more in
principal amount of the Debentures.
8. Indemnification.
(a) The Company shall indemnify and hold harmless
(i) the Placement Agent, the directors, officers and agents of the Placement
Agent, (ii) the Covered Noteholder, the partners, officers and agents of the
Covered Noteholder, and (iii) each person, if any, who controls either the
Placement Agent or the Covered Noteholder within the meaning of Section 15 of
the Act or Section 20 of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), from and against any and all losses, claims, liabilities,
expenses and damages, joint or several, (including any and all investigative,
legal and other expenses reasonably incurred in connection with, and any amount
paid in settlement of, any action, suit or proceeding or any claim asserted),
to which they, or any of them, may become subject under the Act or other
Federal or state statutory law or regulation, at common law or otherwise,
insofar as such losses, claims, liabilities, expenses or damages arise out of
or are based on (x) any untrue statement or alleged untrue statement made by
the Company in Section 3 of this Agreement, (y) any untrue statement or alleged
untrue statement of any material fact contained in (A) the Registration
Statement or the Prospectus or any amendment or supplement to the Registration
Statement or the Prospectus and (B) any application or other document, or any
amendment or supplement thereto, executed by the Company based upon written
information furnished by or on behalf of the Company filed in any jurisdiction
in order to qualify the Debentures under the securities or Blue Sky laws
thereof or filed with the Commission or any securities association or
securities exchange (each, an "Application") or (z) the omission or alleged
omission to state in the Registration Statement or the Prospectus or any
supplement or amendment to the Registration Statement or the Prospectus or any
Application a material fact required to be stated therein or necessary to make
the statements therein not misleading; provided, however, that the Company will
not be liable to the extent that such loss, claim, liability, expense or damage
arises from the sale of the Debentures in the public offering to any person and
is based on (1) an untrue statement or omission or alleged untrue statement or
omission made in reliance on and in conformity with information relating to the
Placement Agent furnished in writing to the Company by the Placement Agent
expressly for inclusion in the Registration Statement or any Prospectus; or (2)
an untrue statement or omission made in
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<PAGE> 23
reliance on and in conformity with information relating to the Covered
Noteholder furnished in writing to the Company by the Covered Noteholder
expressly for inclusion in the Registration Statement or the Prospectus; and
provided, further, however, that the foregoing indemnity agreement is subject
to the condition that, insofar as it relates to any untrue statement, alleged
untrue statement, omission or alleged omission made in any preliminary
Prospectus but eliminated or remedied in the Prospectus made available to the
Placement Agent in a timely manner, such indemnity agreement shall not inure to
the benefit of the Placement Agent or the Covered Noteholder if a copy of the
Prospectus was not sent or given to the person making a claim against the
Placement Agent or Covered Noteholder based upon such statement or omission, at
or prior to the written confirmation of the sale of such Debentures. This
indemnity agreement will be in addition to any liability that the Company might
otherwise have.
(b) The Covered Noteholder will indemnify and
hold harmless the (i) Placement Agent, the directors, officers and agents of
the Placement Agent, (ii) each person, if any, who controls the Placement Agent
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act,
(iii) the Company, and (iv) each person, if any, who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange Act
and each Director of the Company and each officer who has signed the
Registration Statement, from and against any and all losses, claims,
liabilities, expenses and damages, joint or several, (including any and all
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding or any
claim asserted), to which they, or any of them, may become subject under the
Act, the Exchange Act or other Federal or State statutory law or regulation, at
common law or otherwise, insofar as such losses, claims, liabilities, expenses
or damages arise out of or are based on (x) any untrue statement or alleged
untrue statement made by such Covered Noteholder in Section 4 of this
Agreement, (y) any untrue statement or alleged untrue statement of any material
fact contained relating to the Covered Noteholder in the Registration Statement
or the Prospectus or any amendment or supplement to the Registration Statement
or the Prospectus or (z) the omission or alleged omission to state in the
Registration Statement or the Prospectus or any supplement to the Registration
Statement or the Prospectus or any Application a material fact with respect to
the Covered Noteholder required to be stated therein or necessary to make the
statements therein not misleading; provided, however, that such Covered
Noteholder will not be liable to the extent that such loss, claim, liability,
expense or damage arises from the sale of the Debentures in the public offering
to any person by the Placement Agent and is based solely on an untrue statement
or omission or alleged untrue statement or omission made in
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<PAGE> 24
reliance on and in conformity with information relating to the Placement Agent
furnished in writing to the Company by the Placement Agent expressly for
inclusion in the Registration Statement or the Prospectus; and provided,
further, however, that such Covered Noteholder will be liable in any such case
only to the extent that any such loss, claim, damage or liability arises out of
or is based upon any untrue statement or alleged untrue statement or omission
or alleged untrue statement or omission made in the Registration Statement or
any amendment thereto or in the Prospectus or any amendment or supplement
thereto or any Application in reliance upon and in conformity with written
information furnished to the Company by such Covered Noteholder expressly for
inclusion therein. This indemnity agreement will be in addition to any
liability that such Covered Noteholder may otherwise have. The liability of
such Covered Noteholder under this Section 8 shall be limited to an amount
equal to the amount of proceeds received by the Covered Noteholder in the
public offering of the Debentures giving rise to the losses, claims,
liabilities, expenses and damages. The Company and the Covered Noteholder may
agree, as among themselves and without limiting the rights of the Placement
Agent under this Agreement, as to the respective amounts of such liability for
which they each shall be responsible.
(c) The Placement Agent will indemnify and hold
harmless (i) the Company, (ii) the Covered Noteholder, the partners, officers
and agents of the Covered Noteholder and (iii) each person, if any, who
controls the Company or the Covered Noteholder within the meaning of Section 15
of the Act or Section 20 of the Exchange Act and each director of the Company
and each officer of the Company who signs the Registration Statement to the
same extent as the foregoing indemnity from the Company and the Covered
Noteholder to the Placement Agent, but only insofar as losses, claims,
liabilities, expenses or damages arise out of or are based on any untrue
statement or omission or alleged untrue statement or omission made in reliance
on and in conformity with information relating to the Placement Agent furnished
in writing to the Company by the Placement Agent expressly for use in the
Registration Statement or the Prospectus. This indemnity agreement will be in
addition to any liability that the Placement Agent might otherwise have.
(d) Any party that proposes to assert the right
to be indemnified under this Section 8 will, promptly after receipt of notice
of commencement of any action, investigation claim or other proceeding against
such party in respect of which a claim is to be made against an indemnifying
party or parties under this Section 8, notify each such indemnifying party of
the commencement thereof, enclosing a copy of all papers served, but the
omission to so notify such indemnifying party will not
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<PAGE> 25
relieve it from any liability that it may have to any indemnified party under
the foregoing provisions of this Section 8 unless, and only to the extent that,
such omission results in the forfeiture of substantive rights or defenses by
the indemnifying party. If any such action is brought against any indemnified
party it shall notify the indemnifying party of its commencement and the
indemnifying party will be entitled to participate in and, to the extent that
it elects by delivering written notice to the indemnified party promptly after
receiving notice of the commencement of the action from the indemnified party,
jointly with any other indemnifying party similarly notified, assume the
defense of the action, with counsel reasonably satisfactory to the indemnified
party, and after notice from the indemnifying party to the indemnified party of
its election to assume the defense, the indemnifying party will not be liable
to the indemnified party for any legal or other expenses except as provided
below and except for the reasonable costs of investigation subsequently
incurred by the indemnified party in connection with the defense. The
indemnified party will have the right to employ its own counsel in any such
action, but the fees, expenses and other charges of such counsel will be at the
expense of such indemnified party unless (1) the employment of counsel by the
indemnified party has been authorized in writing by the indemnifying party, or
(2) a conflict or potential conflict exists (based on an opinion received from
counsel to the indemnified party) between the indemnified party and the
indemnifying party (in which case the indemnifying party will not have the
right to direct the defense of such action on behalf of the indemnified party),
in each of which cases the reasonable fees, disbursements and other charges of
counsel will be at the expense of the indemnifying party or parties. It is
understood that the indemnifying party or parties shall not, in connection with
any proceeding or related proceedings in the same jurisdiction, be liable for
the reasonable fees, disbursements and other charges of more than one separate
firm admitted to practice in such jurisdiction in any one action or group of
related legal actions for all such indemnified party or parties. All such
fees, disbursements and other charges will be reimbursed by the indemnifying
party promptly as they are incurred. No indemnified party shall, without the
prior written consent, which shall not be reasonably withheld, of the
indemnifying party, settle or compromise or consent to the entry of any
judgment in any pending or threatened claim, action, suit or proceeding, unless
such settlement, compromise or consent includes an unconditional release of the
indemnifying party from all liability arising out of such claim, action, suit
or proceeding. An indemnifying party will not be liable for any settlement of
any action or claim effected without its written consent (which consent will
not be unreasonably withheld).
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<PAGE> 26
(e) In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for in the
foregoing paragraphs of this Section 8 is applicable in accordance with its
terms but for any reason is held by a court to be unavailable to an indemnified
party, then the indemnified party and the indemnifying party will contribute to
the total losses, claims, liabilities, expenses and damages (including any
investigative, legal and other expenses reasonably incurred in connection with,
and any amount paid as a settlement) in such proportion as shall be appropriate
to reflect the relative fault of the Company, the Covered Noteholder and the
Placement Agent, with respect to the statements or omissions which resulted in
such loss, claim, damage or liability, or action or proceeding in respect
thereof, as well as any other relevant equitable considerations. If the
allocation provided thereby is not permitted by applicable law, in such
proportion as shall be appropriate to reflect the relative benefits received by
the Company, the Covered Noteholder and the Placement Agent, provided, that the
benefits received by the Company, the Covered Noteholder and the Placement
Agent shall be deemed to be in the same proportion as the total net proceeds
form the offering (before deducting expenses) received by the Covered
Noteholder and the Placement Agent as set forth on the cover page of the
Prospectus bears to the fee received by the Placement Agent hereunder.
Relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by the Company, the
Covered Noteholder or the Placement Agent, the intent of the parties and their
relative knowledge, access to information and opportunity to correct or prevent
such statement or omission. The Company, the Covered Noteholder and the
Placement Agent agree that it would not be just and equitable if contributions
pursuant to this Section 8(e) were to be determined by pro rata allocation or
by any other method of allocation which does not take into account the
equitable considerations referred to herein. The amount paid or payable by an
indemnified party as a result of the loss, claim, liability, expense or damage,
or action in respect thereof, referred to above in this Section 8(e) shall be
deemed to include, for purpose of this Section 8(e), any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claim. Notwithstanding the
provisions of this Section 8(e), the Placement Agent shall not be required to
contribute any amount in excess of the fee received by it, and no person found
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Act) will be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. For purposes of this Section 8(e), any
person who controls a party to this Agreement within the meaning of the Act or
the Exchange Act will have the same rights to contribution as that
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<PAGE> 27
party, and each officer of the Company who signed the Registration Statement
will have the same rights to contribution as the Company, subject in each case
to the provisions hereof. Any party entitled to contribution, promptly after
receipt of notice of commencement of any action against such party in respect
of which a claim for contribution may be made under this Section 8(e), will
notify any such party or parties from whom contribution may be sought, but the
omission so to notify will not relieve the party or parties from whom
contribution may be sought from any other obligation it or they may have under
this Section 8(e). No party will be liable for contribution with respect to
any action or claim settled without its written consent (which consent will not
be unreasonably withheld).
(f) The indemnity and contribution agreements
contained in this Section 8 and the representations and warranties of each of
the Company and the Covered Noteholder contained in this Agreement shall remain
operative and in full force and effect regardless of (i) any investigation made
by or on behalf of the Placement Agent, (ii) acceptance by the Investors of any
of the Debentures and payment therefor or (iii) any termination of this
Agreement. Insofar as they apply to the Registration Statement and the
offering (or offerings) contemplated thereby, the indemnity and contribution
agreements contained herein shall be understood to supersede and replace in
their entirety the indemnity and contribution agreements contained in that
certain Registration Rights Agreements by and between the Company and the
Covered Noteholder, dated as of May 12, 1992.
9. Termination.
(a) (1) The obligations of the Placement
Agent under this Agreement may be terminated at any time after the Take-Down
Date and prior to the Closing Date, by notice to the Company and the Covered
Noteholder from the Placement Agent, without liability on the part of the
Placement Agent to the Company or the Covered Noteholder if, prior to delivery
and payment for the Debentures, in the sole judgment of the Placement Agent (i)
trading in the Debentures or trading in any of the equity securities of the
Company shall have been suspended by the Commission or by an exchange that
lists the Debentures or the equity securities, (ii) trading in securities
generally on the New York Stock Exchange shall have been suspended or limited
or minimum or maximum prices shall have been generally established on any such
exchange, or additional material governmental restrictions, not in force on the
date of this Agreement, shall have been imposed upon trading in securities
generally by any of such exchanges or by order of the Commission or any court
or other governmental authority, (iii) a general banking moratorium shall have
been declared by Federal or New York State authorities, (iv) any material
adverse change
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<PAGE> 28
in the financial or securities market in the United States or any outbreak or
material escalation of hostilities or declaration by the United States of a
national emergency or war or other calamity or crisis shall have occurred, the
effect of any of which is such as to make it, in the sole judgment of the
Placement Agent, impracticable or inadvisable to market the Debentures on the
terms and in the manner contemplated by the Prospectus.
(2) This Agreement may be terminated by the
Covered Noteholder at any time upon written notice to each of the Company and
the Placement Agent prior to the Closing Date. Notwithstanding any such
termination, however, but subject to Section 10 hereof, the Placement Agent
shall be entitled to receive the compensation described in Section 1(a) hereof
in the event that the Covered Noteholder sells, on or before a date three
months from the Effective Date but in no event longer than 120 days from the
date hereof, Debentures to a purchaser introduced to the Covered Noteholder by
the Placement Agent.
(b) The obligations of the Placement Agent under
this Agreement may be terminated by the Placement Agent at any date prior to
the Effective Date, by notice to the Company and the Covered Noteholder from
the Placement Agent, without liability on the part of the Placement Agent to
the Company or the Covered Noteholder upon a determination, made in good faith,
that the Placement Agent is not prepared to proceed with the engagement as
described in this Agreement.
(c) The obligations of the parties under this
Agreement shall be terminated automatically in the event that the Requisite
Funds have not been deposited by the Investors into the Escrow Account by the
close of business on the Closing Date.
(3) Notwithstanding the provisions of subsection 9(a)(2)
hereof, this Agreement may be terminated by the Covered Noteholder upon written
notice given by the Covered Noteholder to each of the Company and the Placement
Agent (i) following the expiration of 90 days from the date hereof, if prior
to such date the Registration Statement has not been declared effective; (ii)
following the expiration of 75 days from the Effective Date; provided,
however, that upon the Covered Noteholder's termination in reliance upon this
subsection (3), the Covered Noteholder shall remain liable for reimbursing the
Placement Agent, on a fully accountable basis, for all travel, legal and other
out-of-pocket expenses (including any escrow fees) incurred in connection with
the engagement hereunder, up to a maximum of $100,000.
10. Privately Negotiated Sales. During the term of this
Agreement, the Covered Noteholder shall have the right to
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<PAGE> 29
sell the Notes in privately negotiated transactions; however, in the event of
the consummation of any privately negotiated sale by the Covered Noteholder
during the term of this Agreement, the Covered Noteholder shall pay to the
Placement Agent a one-time consulting fee of $100,000 for any and all sales in
any amounts. If Section 9(a)(2) applies to a privately negotiated sale
pursuant to this Section 10, then the Covered Noteholder shall be liable only
for payment of the compensation described in Section 9(a)(2).
11. Notices. Notice given pursuant to any of the provisions
of this Agreement shall be in writing and, unless otherwise specified, shall be
mailed or delivered (a) if to the Company, at the office of the Company, 100
Vine Street, Murfreesboro, Tennessee 37130, Attention: Mr. Richard F. LaRoche,
Jr. or (b) if to the Placement Agent, at the offices of Equitable Securities
Corporation, 800 Nashville City Center, Nashville, Tennessee 37219, Attention:
Mr. R. Riley Sweat or (c) if to the Covered Noteholder, at the offices of The
1818 Fund, L.P., c/o Brown Brothers Harriman & Co., 59 Wall Street, New York,
New York 10005, Attention: Mr. Lawrence C. Tucker. Any such notice shall be
effective only upon receipt. Any notice under Section 8 may be made by telex
or telephone, but if so made shall be subsequently confirmed in writing.
12. Survival. The respective representations, warranties,
agreements, covenants, indemnities and other statements of the Company, its
officers, the Covered Noteholder and the Placement Agent set forth in this
Agreement or made by or on behalf of them, respectively, pursuant to this
Agreement shall remain in full force and effect, regardless of (i) any
investigation made by or on behalf of the Company, any of its officers or
directors, the Placement Agent, the Covered Noteholder or any controlling
person referred to in Section 8 hereof and (ii) delivery of and payment for the
Debentures. The respective agreements, covenants, indemnities and other
statements set forth in Sections 6, 8 and 9(a)(2) hereof shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement.
13. Successors. This Agreement shall inure to the benefit of
and shall be binding upon the Placement Agent, the Company, the Covered
Noteholder and their respective successors and legal representatives, and
nothing expressed or mentioned in this Agreement is intended or shall be
construed to give any other person any legal or equitable right, remedy or
claim under or in respect of this Agreement, or any provisions herein
contained, this Agreement and all conditions and provisions hereof being
intended to be and being for the sole and exclusive benefit of such persons and
for the benefit of no other person except that (i) the indemnities of the
Company contained in Section 8 of this Agreement shall also be for the benefit
of any
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<PAGE> 30
person or persons who control the Placement Agent within the meaning of Section
15 of the Act or Section 20 of the Exchange Act and (ii) the indemnities of the
Placement Agent and the Covered Noteholder contained in Section 8 of this
Agreement shall also be for the benefit of the directors of the Company, the
officers of the Company who have signed the Registration Statement and any
person or persons who control the Company within the meaning of Section 15 of
the Act or Section 20 of the Exchange Act. No Investor shall be deemed a
successor because of such purchase.
14. APPLICABLE LAW. THE VALIDITY AND INTERPRETATION OF THIS
AGREEMENT, AND THE TERMS AND CONDITIONS SET FORTH HEREIN, SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
GIVING EFFECT TO ANY PROVISIONS RELATING TO CONFLICTS OF LAWS.
15. Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
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<PAGE> 31
Please confirm that the foregoing correctly sets forth the
agreement by and among the Company, the Covered Noteholder and the Placement
Agent.
Very truly yours,
NATIONAL HEALTHCARE L.P.
NHC, INC.
Managing General Partner
By: _______________________
Name:
Title:
THE 1818 FUND, L.P.
By: BROWN BROTHERS HARRIMAN & CO.,
GENERAL PARTNER
By: _______________________
Name:
Title:
Confirmed as of the date first
above mentioned:
EQUITABLE SECURITIES CORPORATION
By: __________________________
Name: R. Riley Sweat
Title: Managing Director
Investment Banking Group
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<PAGE> 1
EXHIBIT 1.2
ESCROW AGREEMENT
ESCROW AGREEMENT, dated as of _________ __, 1995, by and among
the 1818 Fund L.P. and its affiliates (collectively, the "Covered Noteholder"),
Equitable Securities Corporation (the "Placement Agent") and Citibank, N.A., a
national banking institution incorporated under the laws of the United States
of America (the "Escrow Agent").
WHEREAS, the Covered Noteholder proposes to sell $[30,000,000]
aggregate principal amount (the "Principal Amount") of the Company's 6.0%
Senior Subordinated Convertible Debentures due 2000 (the "Debentures"),
convertible into limited partnership units of the Company (the "Units"), for a
total of $______, all as described in the Company's Registration Statement on
Form S-3 (which, together with all amendments or supplements thereto is
referred to herein as the "Registration Statement").
WHEREAS, the Debentures are being offered to investors by the
Placement Agent on a best efforts, all or none, basis, pursuant to registration
under the Securities Act of 1933, as amended, and pursuant to registration or
exemptions from registration under state securities laws;
WHEREAS, the offering of the Debentures will terminate on
_________ __, 1995 (the "Closing Date") and, if subscriptions for the total
number of Debentures being offered pursuant to the Registration Statement have
not been received by the Covered Noteholder on or before the Closing Date, no
Debentures will be sold and all payments made by subscribers will be refunded
by the Escrow Agent with interest earned thereon, if any; and
WHEREAS, with respect to all subscription payments received
from subscribers, the Covered Noteholder proposes to establish an escrow
account with the Escrow Agent at the office of its Escrow Administration, 120
Wall Street, 13th Floor, New York, New York 10043.
NOW THEREFORE, it is agreed as follows:
1. Establishment of Escrow. The Escrow Agent hereby
agrees to receive and disburse the proceeds from the offering of the Debentures
and any interest earned thereon in accordance herewith.
<PAGE> 2
2. Deposit of Escrowed Property. The Placement Agent
shall from time to time cause the Subscribers to wire or deposit with the
Escrow Agent funds or checks of the subscribers delivered in payment for
Debentures (the "Escrowed Property"). Such Escrowed Property shall be wired to
or deposited with the Escrow Agent not later than 12:00 noon on the date
following the date on which it is received by the Placement Agent. Any checks
delivered to the Escrow Agent pursuant to the terms hereof shall be made
payable to the order of the Escrow Agent, for the account of the 1818 Fund,
L.P./National HealthCare, L.P. The Escrow Agent upon receipt of such checks
shall present such checks for payment to the drawee-bank under such checks.
Any checks not honored by the drawee-bank thereunder after the first
presentment for payment shall be returned to the Covered Noteholder in the same
manner notices are delivered pursuant to Section 6. Upon receipt of funds or
checks from the Placement Agent, the Escrow Agent shall credit such funds and
the amount of such checks to a non-interest-bearing account (the "Escrow
Account") held by the Escrow Agent. If following the credit of the amount of
any check to the Escrow Account such check is dishonored, the Escrow Agent, if
such dishonored check amount shall have been invested pursuant to Section 3,
shall liquidate to the extent of such dishonored check amount such investments
and debit the Escrow Account for the amount of such dishonored check plus, if
any, the amount of interest and other income earned with respect to any
investment of such dishonored check amount.
3. Investment of Escrowed Property. The Escrow Agent on
the second business day ("business day" defined for purposes of this Escrow
Agreement as any day which is not a Saturday, a Sunday or a day on which banks
or trust companies in the City and State of New York are authorized or
obligated by law, regulation or executive order to remain closed) succeeding
(unless such deposit is made in federal or other immediately available or "same
day" funds, in which case, on the business day next succeeding) the credit of
any subscription proceeds to the Escrow Account pursuant to Section 2 and until
release of such proceeds in accordance with the terms hereof, shall place such
proceeds in a Citibank Money Market Deposit Account, pursuant to Rule 15c2-4
promulgated by the Securities and Exchange Commission under the Securities
Exchange Act of 1934, as amended, in accordance with the terms set forth on
Exhibit I hereto (made a part of this Escrow Agreement as if herein set forth).
The Escrow Agent shall in no event be liable for any loss resulting from any
change in interest rates applicable to proceeds invested pursuant to this
Section. Interest on proceeds invested pursuant to this Section shall accrue
from the date of investment of such proceeds until the termination of such
investment pursuant to the terms hereof and shall be paid as set forth in
Section 5.
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<PAGE> 3
4. List of Subscribers. The Placement Agent shall
furnish or cause to be furnished to the Escrow Agent, at the time of each
deposit of funds or checks pursuant to Section 2, a list, substantially in the
form of Exhibit B hereto, containing the name of, the address of, the number of
Debentures subscribed for by, the subscription amount delivered to the Escrow
Agent on behalf of, and the social security or taxpayer identification number,
if applicable, of, each subscriber whose funds are being deposited, and to
which is attached a completed W-9 form (or, in the case of any subscriber who
is not a United States citizen or resident, a W-8 form) for each listed
subscriber. The Escrow Agent shall notify the Placement Agent and the Covered
Noteholder of any discrepancy between the subscription amounts set forth on any
list delivered pursuant to this Section 4 and the subscription amounts received
by the Escrow Agent. The Escrow Agent is authorized to revise such list to
reflect the actual subscription amounts received and the release of any
subscription amounts pursuant to Section 5.
5. Withdrawal of Subscription Amounts. (a) If the
Escrow Agent shall receive a notice, substantially in the form of Exhibit C
hereto (an "Offering Termination Notice"), from the Covered Noteholder, the
Escrow Agent shall (i) promptly after receipt of such Offering Termination
Notice and the clearance of all checks received by the Escrow Agent as Escrowed
Property, liquidate any investments that shall have been made pursuant to
Section 3 and send to each subscriber listed on the list held by the Escrow
Agent pursuant to Section 4 whose total subscription amount shall not have been
released pursuant to paragraph (b) or (c) of this Section 5, in the manner set
forth in paragraph (d) of this Section 5, a check to the order of such
subscriber in the amount of the remaining subscription amount held by the
Escrow Agent as set forth on such list held by the Escrow Agent, and (ii)
promptly after the fourth business day of the month immediately following the
month in which the investments made pursuant to Section 3 were terminated
pursuant to this paragraph, send, in the manner set forth in paragraph (d) of
this Section 5, a check to the order of each such subscriber in the amount of
interest and other income earned and not yet paid with respect to any
investment of such subscriber's funds. The Escrow Agent shall notify the
Covered Noteholder and the Placement Agent of the distribution of such funds to
the subscribers.
(b) In the event that (i) the Debentures have
been subscribed for and funds in respect thereof shall have been deposited with
the Escrow Agent on or before the Final Closing Date and (ii) no Offering
Termination Notice shall have been delivered to the Escrow Agent, the and the
Placement Agent, from time to time may deliver to the Escrow Agent a joint
notice, substantially in the form of Exhibit D hereto (a "Closing Notice"),
designating the date on which Debentures are to be
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<PAGE> 4
sold and delivered to the subscribers thereof (the "Closing Date"), which date
shall not be earlier than the clearance of any checks received by the Escrow
Agent as Escrowed Property, the proceeds of which are to be distributed on such
Closing Date, and identifying the subscribers and the number of Debentures to
be sold to each thereof on such Closing Date, not less than two (2) nor more
than seven (7) business days prior to such Closing Date. The Escrow Agent,
after receipt of such Closing Notice and the clearance of such checks:
(i) on or prior to the Closing Date
identified in such Closing Notice, shall liquidate any investments
that shall have been made pursuant to Section 3 to the extent of the
subscription amount to be distributed pursuant to the immediately
succeeding clause (ii);
(ii) on such Closing Date, pay to the Covered
Noteholder and the Placement Agent, in federal or other immediately
available funds and otherwise in the manner specified by the Covered
Noteholder in such Closing Notice, an amount equal to the aggregate of
the subscription amounts paid by the subscribers identified in such
Closing Notice for the Debentures to be sold on such Closing Date as
set forth on the list held by the Escrow Agent pursuant to Section 4;
and
(iii) promptly after the fourth business day of
the month immediately following the month in which the investments
made pursuant to Section 3 were terminated pursuant to such Closing
Notice, shall send, in the manner set forth in paragraph (d) of this
Section 5, a check to the order of each subscriber identified in such
Closing Notice in the amount of interest and other income earned and
not yet paid with respect to any investment of such subscriber's funds
distributed on such Closing Date. At the time of such transfer, the
Escrow Agent shall identify in writing to the Placement Agents the
amount of the interest earned for the account of each subscriber and
the date such subscription was received.
(c) If at any time and from time to time prior to
the release of any subscriber's total subscription amount pursuant to paragraph
(a) or (b) of this Section 5 from escrow, the Company shall deliver to the
Escrow Agent a notice, substantially in the form of Exhibit E hereto (a
"Subscription Termination Notice"), to the effect that any or all of the
subscriptions of such subscriber have been rejected by the Company (a "Rejected
Subscription"), the Escrow Agent (i) promptly after receipt of such
Subscription Termination Notice and, if such subscriber delivered a check in
payment of its Rejected Subscription, after the clearance of such check, shall
liquidate, to the extent of the sum of such subscriber's
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<PAGE> 5
Rejected Subscription amount as set forth in the Subscription Termination
Notice, any investments that shall have been made pursuant to Section 3 and
send to such subscriber, in the manner set forth in paragraph (d) of this
Section 5, a check to the order of such subscriber in the amount of such
Rejected Subscription amount, and (ii) promptly after the fourth business day
of the month immediately following the month in which the investments made
pursuant to Section 3 were terminated pursuant to this paragraph, shall send to
such subscriber, in the manner set forth in paragraph (d) of this Section 5, a
check to the order of such subscriber in the amount of interest and other
income earned and not yet paid with respect to any investment of such
subscriber's Rejected Subscription amount. At the time of such transfer, the
Escrow Agent shall identify in writing to the Covered Noteholder and the
Placement Agent the amount of the interest earned for the account of each
subscriber and the date such subscription was received.
(d) On a date following the transfer of any
interest earned for the account of each subscriber pursuant to Section 5(a),
(b) or (c), but not later than January 1, 1996 the Escrow Agent shall provide
each subscriber with tax form 1099 setting forth the amount of such interest.
(e) For the purposes of this Section 5, any check
that the Escrow Agent shall be required to send to any subscriber shall be sent
to such subscriber by first class mail, postage prepaid, at such subscriber's
address furnished to the Escrow Agent pursuant to Section 4.
6. Notices. Any notice or other communication required
or permitted to be given hereunder shall be in writing and shall be (a)
delivered by hand or (b) sent by mail, registered or certified, with proper
postage prepaid, and addressed as follows:
if to the Placement Agent, to:
Equitable Securities Corporation
Nashville City Center
Suite 800
511 Union Street
Nashville, Tennessee 37219
Attention: Mr. R. Riley Sweat
with a copy to:
Stroock & Stroock & Lavan
Seven Hanover Square
New York, New York 10004-2696
Attention: James R. Tanenbaum, Esq.
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<PAGE> 6
if to the Escrow Agent, to:
Citibank, N.A.
Corporate Trust
Escrow Administration
120 Wall Street, 13th Floor
New York, New York 10043
Attention: Mr. Bryan Gartenberg
if to the Covered Noteholder, to:
The 1818 Fund, L.P.
c/o Brown Brothers Harriman & Co.
59 Wall Street
New York, New York 10005
Attention: Mr. Walter Grist
with a copy to:
Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019
Attention: Mitchell Fishman, Esq.
or to such other address as the person to whom notice is to be given may have
previously furnished to the others in the above-referenced manner. All such
notices and communications, if mailed, shall be effective when deposited in the
mails, except that notices and communications to the Escrow Agent and notices
of changes of address shall not be effective until received.
7. Concerning the Escrow Agent. To induce the Escrow
Agent to act hereunder, it is further agreed by the Placement Agents that:
(a) The Escrow Agent shall not be under any duty
to give the Escrowed Property held by it hereunder any greater degree of care
than it gives its own similar property and shall not be required to invest any
funds held hereunder except as directed in this Escrow Agreement. Uninvested
funds held hereunder shall not earn or accrue interest.
(b) This Escrow Agreement expressly sets forth
all the duties of the Escrow Agent with respect to any and all matters
pertinent hereto. No implied duties or obligations shall be read into this
Escrow Agreement against the Escrow Agent. The Escrow Agent shall not be bound
by the provisions of any agreement among the other parties hereto except this
Escrow Agreement.
(c) The Escrow Agent shall not be liable, except
for its own negligence or willful misconduct, and, except with
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<PAGE> 7
respect to claims based upon such negligence or willful misconduct that are
successfully asserted against the Escrow Agent, the other parties hereto shall
jointly and severally indemnify and hold harmless the Escrow Agent (and any
successor Escrow Agent) from and against any and all losses, liabilities,
claims, actions, damages and expenses, including reasonable attorneys' fees and
disbursements, arising out of and in connection with this Escrow Agreement.
Without limiting the foregoing, the Escrow Agent shall in no event be liable in
connection with its investment or reinvestment of any cash held by it hereunder
in good faith, in accordance with the terms hereof, including without
limitation any liability for any delays (not resulting from gross negligence or
willful misconduct) in the investment or reinvestment of the Escrowed Property,
or any loss of interest incident to any such delays.
(d) The Escrow Agent shall be entitled to rely
upon any order, judgment, certification, demand, notice, instrument or other
writing delivered to it hereunder without being required to determine the
authenticity or the correctness of any fact stated therein or the propriety or
validity of the service thereof. The Escrow Agent may act in reliance upon any
instrument or signature believed by it in good faith to be genuine and may
assume, if in good faith, that any person purporting to give notice or receipt
or advice or make any statement or execute any document in connection with the
provisions hereof has been duly authorized to do so.
(e) The Escrow Agent may act pursuant to the
advice of counsel with respect to any matter relating to this Escrow Agreement
and shall not be liable for any action taken or omitted in good faith and in
accordance with such advice.
(f) The Escrow Agent does not have any interest
in the Escrowed Property deposited hereunder but is serving as escrow holder
only. Any payments of income from the Escrow Account shall be subject to
withholding regulations then in force with respect to United States taxes. The
parties hereto will provide the Escrow Agent with appropriate W-9 forms for tax
I.D., number certification, or non-resident alien certifications.
This paragraph (f) and paragraph (c) of this Section 7 shall
survive notwithstanding any termination of this Escrow Agreement or the
resignation of the Escrow Agent.
(g) The Escrow Agent makes no representation as
to the validity, value, genuineness or the collectibility of any security or
other documents or instrument held by or delivered to it.
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<PAGE> 8
(h) The Escrow Agent shall not be called upon to
advise any party as to the wisdom in selling or retaining or taking or
refraining from any action with respect to any securities or other property
deposited hereunder.
(i) The Escrow Agent (and any successor escrow
agent) at any time may be discharged from its duties and obligations hereunder
by the delivery to it of notice of termination signed by the Placement Agent or
at any time may resign by giving written notice to such effect to the Placement
Agent. Upon any such termination or resignation, the Escrow Agent shall
deliver the Escrowed Property to any successor escrow agent jointly designated
by the other parties hereto in writing, or to any court of competent
jurisdiction if no such successor escrow agent is agreed upon, whereupon the
Escrow Agent shall be discharged of and from any and all further obligations
arising in connection with this Escrow Agreement. The termination or
resignation of the Escrow Agent shall take effect on the earlier of (i) the
appointment of a successor (including a court of competent jurisdiction) or
(ii) the day that is 30 days after the date of delivery: (A) to the Escrow
Agent of the other parties' notice of termination or (B) to the other parties
hereto of the Escrow Agent's written notice of resignation. If at that time
the Escrow Agent has not received a designation of a successor escrow agent,
the Escrow Agent's sole responsibility after that time shall be to keep the
Escrowed Property safe until receipt of a designation of successor escrow agent
or a joint written disposition instruction by the other parties hereto or any
enforceable order of a court of competent jurisdiction.
(j) The Escrow Agent shall have no responsibility
for the contents of any writing of any third party contemplated herein as a
means to resolve disputes and may rely without any liability upon the contents
thereof.
(k) In the event of any disagreement among or
between the other parties hereto and/or the subscribers of the Debentures
resulting in adverse claims or demands being made in connection with the
Escrowed Property, or in the event that the Escrow Agent in good faith is in
doubt as to what action it should take hereunder, the Escrow Agent shall be
entitled to retain the Escrowed Property until the Escrow Agent shall have
received (i) a final and non-appealable order of a court of competent
jurisdiction directing delivery of the Escrowed Property or (ii) a written
agreement executed by the other parties hereto and consented to by the
subscribers directing delivery of the Escrowed Property, in which event the
Escrow Agent shall disburse the Escrowed Property in accordance with such order
or agreement. Any court order referred to in (i) above shall be accompanied by
a legal opinion by counsel for the presenting party satisfactory to the Escrow
Agent to the
-8-
<PAGE> 9
effect that said court order is final and non-appealable. The Escrow Agent
shall act on such court order and legal opinion without further question.
(l) As consideration for its agreement to act as
Escrow Agent as herein described, the other parties hereto, jointly and
severally, agree to pay the Escrow Agent fees determined in accordance with the
terms set forth on Exhibit F hereto (made a part of this Escrow Agreement as if
herein set forth). In addition, the other parties hereto, jointly and
severally, agree to reimburse the Escrow Agent for all reasonable expenses,
disbursements and advances incurred or made by the Escrow Agent in performance
of its duties hereunder (including reasonable fees, expenses and disbursements
of its counsel).
(m) The other parties hereto irrevocably (i)
submit to the jurisdiction of any New York State or federal court sitting in
New York City in any action or proceeding arising out of or relating to this
Escrow Agreement, (ii) agree that all claims with respect to such action or
proceeding shall be heard and determined in such New York State or federal
court and (iii) waive, to the fullest extent possible, the defense of an
inconvenient forum. The other parties hereby consent to and grant any such
court jurisdiction over the persons of such parties and over the subject matter
of any such dispute and agree that delivery or mailing of process or other
papers in connection with any such action or proceeding in the manner provided
hereinabove, or in such other manner as may be permitted by law, shall be valid
and sufficient service thereof.
(n) No printed or other matter in any language
(including, without limitation, the Registration Statement, notices, reports
and promotional material) which mentions the Escrow Agent's name or the rights,
powers, or duties of the Escrow Agent shall be issued by the other parties
hereto or on such parties' behalf unless the Escrow Agent shall first have
given its specific written consent thereto. The Escrow Agent hereby consents
to the use of its name and the reference to the escrow arrangement in the
Registration Statement.
8. Miscellaneous. (a) This Escrow Agreement shall be
binding upon and inure solely to the benefit of the parties hereto and their
respective successors and assigns, heirs, administrators and representatives,
and the subscribers of the Debentures and shall not be enforceable by or inure
to the benefit of any other third party except as provided in paragraph (i) of
Section 7 with respect to the termination of, or resignation by, the Escrow
Agent. No party may assign any of its rights or obligations under this Escrow
Agreement without the written consent of the other parties.
-9-
<PAGE> 10
(b) This Escrow Agreement shall be construed in
accordance with and governed by the internal law of the State of New York
(without reference to its rules as to conflicts of law).
(c) This Escrow Agreement may only be modified by
a writing signed by all of the parties hereto and consented to by the
subscribers of the Debentures adversely affected by such modifications. No
waiver hereunder shall be effective unless in a writing signed by the party to
be charged.
(d) This Escrow Agreement shall terminate upon
the payment pursuant to Section 5 of all amounts held in the Escrow Account.
(e) The section headings herein are for
convenience only and shall not affect the construction thereof. Unless
otherwise indicated, references to Sections are to Sections contained herein.
(f) This Escrow Agreement may be executed in one
or more counterparts but all such separate counterparts shall constitute but
one and the same instrument; provided that, although executed in counterparts,
the executed signature pages of each such counterpart may be affixed to a
single copy of this Agreement which shall constitute an original.
-10-
<PAGE> 11
IN WITNESS WHEREOF, the parties hereto have caused this Escrow
Agreement to be executed as of the day and year first above written.
EQUITABLE SECURITIES CORPORATION
By:
--------------------------------
Name: R. Riley Sweat
Title: Managing Director
Investment Banking Group
THE 1818 FUND, L.P.
By: BROWN BROTHERS HARRIMAN &
CO., GENERAL PARTNER
By:
--------------------------------
Name:
Title: General Partner
CITIBANK, N.A.
By:
--------------------------------
Name:
Title:
-11-
<PAGE> 12
EXHIBIT A
Citibank Insured Money Market Deposit Accounts
Deposits/Withdrawals may be made to the Citibank Money Market
Deposit Account ("MMDA") established under the Escrow Agreement to which this
Exhibit is attached only through the Escrow Account. All transaction and
balance reporting of the MMDA will be included as part of the Escrow Account
Statement. Activity in the MMDA will be reflected as the equivalent of dollars
on deposit in a Citibank Money Market Deposit Account. Deposits/Withdrawals to
the MMDA will be made only as permitted by the Escrow Agreement to which this
Exhibit is attached. The MMDA has certain regulatory restrictions as well as
some minimum requirements:
1. By regulation, Citibank, N.A. is required to reserve the
right to require seven days' prior notice of any withdrawals of funds from an
account; provided, however, that, if Citibank, N.A. elects to exercise its
right to require seven days' prior notice, it shall exercise such right as to
all such accounts established.
2. A daily balance of $10,000 must be maintained on deposit
in the MMDA. If the MMDA should fall below $10,000 on any day, Citibank, N.A.
will be authorized to transfer the remaining balance to the Escrow Account.
3. Rates will be determined by Citibank, N.A. and can be
determined by calling your custody account officer.
4. Balances up to $100,000 (total on deposit at Citibank,
N.A.) are FDIC-insured.
A-1
<PAGE> 13
<TABLE>
<CAPTION>
EXHIBIT B
SUMMARY OF CASH RECEIVED
NEW PARTICIPANT DEPOSIT
Date:
----------------------
Deposit Date: List Number:
Investment Date: ----------------------
Batch Number: Page of
--- ----------------------
Approved By:
----------------------
JOB#:
-----------------------------
For Bank use only
TITLE:
- -----------------------------------------------
- ----------------------------------------------------------------------------------------------------
AMOUNT OF TAX ID NO./ FOR BANK
NAME DEPOSIT Securities ADDRESS SOC.SEC. NO. USE ONLY
- ----------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
TAX CODE
EXEMPT(Y/N)
W-9(YR) NRA
W-8(YR)
1008(87)
- ----------------------------------------------------------------------------------------------------
Broker Misc. Misc. II Misc. III TAX CODE
EXEMPT(Y/N)
W-2(YR) NRS
W-8(YR)
1008(87)
- ----------------------------------------------------------------------------------------------------
Broker Misc. Misc. II Misc. III TAX CODE
EXEMPT(Y/N)
W-2(YR) NRS
W-8(YR)
1008(87)
- ----------------------------------------------------------------------------------------------------
Broker Misc. Misc. II Misc. III TAX CODE
EXEMPT(Y/N)
W-2(YR) NRS
W-8(YR)
1000(87)
- ----------------------------------------------------------------------------------------------------
Broker Misc. Misc. II Misc. III
</TABLE>
B-1
<PAGE> 14
EXHIBIT C
[Form of Offering Termination Notice]
_________________ __, 1995
Citibank, N.A.
Corporate Trust
Escrow Administration
120 Wall Street, 13th Floor
New York, New York 10043
Attention: Mr. Bryan Gartenberg
Senior Trust Officer
Dear Mr. Gartenberg:
Pursuant to Section 5(a) of the Escrow Agreement dated as of
_________ __, 1995 (the "Escrow Agreement") among Equitable Securities
Corporation (the "Placement Agent"), the 1818 Fund L.P. and its affiliates
(collectively, the "Covered Noteholder"), and you, the Covered Noteholder
hereby notifies you of the termination of the offering of the Debentures (as
that term is defined in the Escrow Agreement) and directs you to make payments
to subscribers as provided for in Section 5(a) of the Escrow Agreement.
Very truly yours,
THE 1818 FUND L.P.
By:
----------------
Name:
Title:
C-1
<PAGE> 15
EXHIBIT D
[Form of Closing Notice]
_________ __, 1995
Citibank, N.A.
Corporate Trust
Escrow Administration
120 Wall Street, 13th Floor
New York, New York 10043
Attention: Mr. Bryan Gartenberg
Senior Trust Officer
Ladies and Gentlemen:
Pursuant to Section 5(b) of the Escrow Agreement dated as of _________
__, 1995, (the "Escrow Agreement") among Equitable Securities Corporation (the
"Placement Agent"), the 1818 Fund L.P. and its affiliates (collectively, the
"Covered Noteholder") and you, the Covered Noteholder hereby certifies that it
has received subscriptions for the Debentures (as that term is defined in the
Escrow Agreement) and the Covered Noteholder will sell and the Company will
deliver Debentures to the subscribers thereof at a closing to be held on
_________ __, 1995 (the "Closing Date"). The names of the subscribers
concerned, the number of Debentures subscribed for by each of such subscribers
and the related subscription amounts are set forth on Schedule I annexed
hereto.
Please accept these instructions as standing instructions for the
closing to be held on the Closing Date. The parties hereto certify that they
do not wish to have a call back regarding these instructions.
We hereby request that the aggregate subscription amount be paid to the
Placement Agents and us as follows:
1. To Equitable Securities Corporation, $_________;
2. To the Covered Noteholder, $_________;
and
3. To the Escrow Agent, $_________.
D-1
<PAGE> 16
This Agreement may be executed in any number of counterparts, each
of which shall be deemed to be an original, and all of which together shall
constitute one and the same instrument.
Very truly yours,
EQUITABLE SECURITIES CORPORATION
By:
---------------------------
Name:
Title:
THE 1818 FUND, L.P.
By: BROWN BROTHERS HARRIMAN & CO.,
GENERAL PARTNER
By:
---------------------------
Name:
Title: General Partner
D-2
<PAGE> 17
SCHEDULE I
Name of Subscriber Principal Amount of Debentures Subscription Amount
- ------------------ ------------------------------ -------------------
<PAGE> 18
EXHIBIT E
[Form of Subscription Termination Notice]
Citibank, N.A.
Corporate Trust
Escrow Administration
120 Wall Street, 13th Floor
New York, New York 10043
Attention: Mr. Bryan Gartenberg
Senior Trust Officer
Dear Mr. Gartenberg:
Pursuant to Section 5(c) of the Escrow Agreement dated as of
_________ __, 1995 (the "Escrow Agreement") among Equitable Securities
Corporation (the "Placement Agent"), the 1818 Fund, L.P. and its affiliates
(collectively, the "Covered Noteholder") and you, the Covered Noteholder hereby
notifies you that the following subscription(s) have been rejected:
<TABLE>
<CAPTION>
Amount of Subscribed Amount of
Name of Subscriber(s) Securities Rejected Rejected Subscription
- --------------------- -------------------- ---------------------
<S> <C> <C>
$ $
</TABLE>
Very truly yours,
THE 1818 FUND, L.P.
By:________________________________
Name:
Title:
<PAGE> 19
EXHIBIT F
A. A fee of $5,000 representing a minimum administration fee
shall be paid upon execution of the Escrow Agreement to which this Exhibit is
attached.
B. A fee equal to:
10 Basis Points or the first $5,000,000 of any part
thereof,
6 Basis Points on the next $5,000,000
3 Basis Points on the next $90,000,000
1/2 Basis Points on amount over $100,000,000 or Escrow
Property received by the Escrow Agent prior to the First Closing Date
and succeeding closing dates pursuant to the terms of the offering.
The initial fee paid at the time of execution will be deducted from
the Escrow Administration fee as calculated pursuant to the above
schedule.
C. A fee for record-keeping equal to the following:
(1) $4.00 for each check issued by the Escrow Agent
(2) $9.00 for each participant (Hard Copy input of
subscriber information and
(3) $2.00 for each 1099 form issued
(4) $5.00 for each interest calculation
(5) $20.00 for each cancellation, correction or
withdrawal of Escrowed Property made by the
Escrow Agent pursuant to Section 6(d) of the
Escrow Agreement to which this Exhibit is
attached shall be paid when billed by the
Escrow Agent.
Capitalized terms not otherwise defined shall have the meanings subscribed
thereto in the Escrow Agreement to which this Exhibit is attached.
F-1
<PAGE> 1
EXHIBIT 4.2
- --------------------------------------------------------------------------------
NATIONAL HEALTHCARE L.P.
$30,000,000
6.0% Convertible Senior Subordinated Debenture due 2000
INDENTURE
Dated as of August 29, 1995
FIRST AMERICAN NATIONAL BANK,
AS TRUSTEE
- --------------------------------------------------------------------------------
<PAGE> 2
<TABLE>
<CAPTION>
CROSS-REFERENCE TABLE
NATIONAL HEALTHCARE L.P.
Trust Indenture
Act Section Indenture
----------------- ---------
<S> <C>
Section 310(a)(1) 7.10
(a)(2) 7.10
(a)(3) Not Applicable
(a)(4) Not Applicable
(b) 7.08; 7.10; 13.02
(c) Not Applicable
Section 311(a) 7.11
(b) 7.11
(c) Not Applicable
Section 312(a) 2.12
(b) 13.03
(c) 13.03
Section 313(a) 7.06
(b)(1) Not Applicable
(b)(2) 7.06
(c) 7.06; 13.02
(d) 7.06
Section 314(a) 4.02; 13.02
(b) Not Applicable
(c)(1) 13.04
(c)(2) 13.04
(c)(3) Not Applicable
(d) Not Applicable
(e) 13.05
(f) Not Applicable
Section 315(a) 7.01(b)
(b) 7.05; 13.02
(c) 7.01(a)
(d) 7.01(c)
(e) 6.10
Section 316(a)(last sentence) 13.06
(a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) Not Applicable
(b) 6.06
Section 317(a)(1) 6.07
(a)(2) 6.08
(b) 2.05
Section 318(a) 12.01
</TABLE>
__________
Note: This Cross-Reference Table shall not, for any purpose, be deemed to
be a part of the Indenture.
<PAGE> 3
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
<S> <C> <C>
ARTICLE 1 DEFINITIONS AND INCORPORATION BY REFERENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.01 Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
SECTION 1.02 Other Definitions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
SECTION 1.03 Incorporation by Reference to Trust Indenture Act. . . . . . . . . . . . . . . 9
SECTION 1.04 Rules of Construction. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE 2 THE SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.01 Dating; Incorporation of Form in Indenture. . . . . . . . . . . . . . . . . . 10
SECTION 2.02 Execution and Authentication . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 2.03 Global Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
SECTION 2.04 Registrar and Agents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.05 Paying Agent to Hold Money in Trust. . . . . . . . . . . . . . . . . . . . . 12
SECTION 2.06 Transfer and Exchange. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.07 Replacement Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 2.08 Outstanding Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.09 Temporary Securities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 2.10 Cancellation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.11 Defaulted Interest . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.12 Securityholder Lists . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 2.13 Persons Deemed Owners. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 2.14 CUSIP Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
ARTICLE 3 REDEMPTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
SECTION 3.01 Right of Redemption; Notices to Trustee. . . . . . . . . . . . . . . . . . . . 16
SECTION 3.02 Selection of Securities to be Redeemed . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.03 Notice of Redemption by the Company. . . . . . . . . . . . . . . . . . . . . . 17
SECTION 3.04 Effect of Notice of Redemption . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 3.05 Deposit of Redemption Price. . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.06 Securities Redeemed in Part. . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 3.07 Termination of Rights. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
ARTICLE 4 COVENANTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 4.01 Payment of the Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 4.02 Commission Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 4.03 Distributions. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 4.04 Notice of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 4.05 Compliance Certificates. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 4.06 Reserved . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 4.07 Additional Indebtedness. . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
SECTION 4.08 Preservation of Existence. . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.09 Payment of Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
</TABLE>
<PAGE> 4
<TABLE>
<S> <C> <C>
SECTION 4.10 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.11 Registration and Listing . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 4.12 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 4.13 No Inconsistent Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ARTICLE 5 SUCCESSOR CORPORATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 5.01 When Company May Merge, etc. . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 5.02 Successor Corporation or Trust Substituted . . . . . . . . . . . . . . . . . . 24
ARTICLE 6 DEFAULTS AND REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 6.01 Events of Default. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
SECTION 6.02 Acceleration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 6.03 Other Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SECTION 6.04 Waiver of Defaults and Events of Default. . . . . . . . . . . . . . . . . . . 27
SECTION 6.05 Control by Majority. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 6.06 Rights of Holders to Receive Payment . . . . . . . . . . . . . . . . . . . . . 27
SECTION 6.07 Collection Suit by Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 6.08 Trustee May File Proofs of Claim . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 6.09 Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
SECTION 6.10 Undertaking for Costs. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
SECTION 6.11 Limitations on Suits . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
ARTICLE 7 TRUSTEE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 7.01 Duties of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
SECTION 7.02 Rights of Trustee. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
SECTION 7.03 Individual Rights of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 7.04 Trustee's Disclaimer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 7.05 Notice of Defaults . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 7.06 Reports by Trustee to Holders. . . . . . . . . . . . . . . . . . . . . . . . . 32
SECTION 7.07 Compensation and Indemnity . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 7.08 Replacement of Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
SECTION 7.09 Successor Trustee by Merger, etc . . . . . . . . . . . . . . . . . . . . . . . 34
SECTION 7.10 Eligibility; Disqualification. . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 7.11 Preferential Collection of Claims Against Company. . . . . . . . . . . . . . . 35
ARTICLE 8 SATISFACTION AND DISCHARGE OF INDENTURE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECTION 8.01 Satisfaction, Discharge and Defeasance of the Securities . . . . . . . . . . . 35
SECTION 8.02 Satisfaction and Discharge of Indenture. . . . . . . . . . . . . . . . . . . . 36
SECTION 8.03 Survival of Certain Obligations. . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 8.04 Application of Trust Money . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 8.05 Paying Agent to Repay Monies Held. . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 8.06 Return of Unclaimed Monies . . . . . . . . . . . . . . . . . . . . . . . . . . 37
SECTION 8.07 Reinstatement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
ARTICLE 9 SUPPLEMENTAL INDENTURES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
SECTION 9.01 Supplemental Indentures Without Consent of Holders . . . . . . . . . . . . . . 38
</TABLE>
ii
<PAGE> 5
<TABLE>
<S> <C> <C>
SECTION 9.02 Supplemental Indentures with Consent of Holders. . . . . . . . . . . . . . . . 39
SECTION 9.03 Compliance with Trust Indenture Act. . . . . . . . . . . . . . . . . . . . . . 40
SECTION 9.04 Revocation and Effect of Consents. . . . . . . . . . . . . . . . . . . . . . . 40
SECTION 9.05 Notation on or Exchange of Securities. . . . . . . . . . . . . . . . . . . . . 41
SECTION 9.06 Effect of Supplemental Indentures. . . . . . . . . . . . . . . . . . . . . . . 41
SECTION 9.07 Reference in Securities to Supplemental Indentures . . . . . . . . . . . . . . 41
ARTICLE 10 CONVERSION OF SECURITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 10.01 Right of Conversion; Conversion Price. . . . . . . . . . . . . . . . . . . . . 42
SECTION 10.02 Issuance of Units on Conversion. . . . . . . . . . . . . . . . . . . . . . . . 42
SECTION 10.03 Payment of Interest. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 10.04 Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . . . . . . . 43
SECTION 10.05 Notice of Adjustment of Conversion Price . . . . . . . . . . . . . . . . . . . 47
SECTION 10.06 Notice of Certain Corporate Action. . . . . . . . . . . . . . . . . . . . . . 48
SECTION 10.07 Taxes on Conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 10.08 Fractional Units . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
SECTION 10.09 Cancellation of Converted Securities . . . . . . . . . . . . . . . . . . . . . 49
SECTION 10.10 Provisions in Case of Consolidation, Merger or Sale of Assets. . . . . . . . . 50
SECTION 10.11 Disclaimer by Trustee of Responsibility for Certain Matters. . . . . . . . . . 50
SECTION 10.12 Covenant to Reserve Units. . . . . . . . . . . . . . . . . . . . . . . . . . . 51
ARTICLE 11 CHANGE IN CONTROL . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 11.01 Change of Control Offer. . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
SECTION 11.02 Definition of Change of Control. . . . . . . . . . . . . . . . . . . . . . . . 52
SECTION 11.03 Notice of Offer. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
ARTICLE 12 SUBORDINATION; SENIORITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
SECTION 12.01 Securities Subordinated to Senior Indebtedness . . . . . . . . . . . . . . . . 54
SECTION 12.02 Company Not to Make Payments with Respect to Securities in
Certain Circumstances. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
SECTION 12.03 Subrogation of Securities. . . . . . . . . . . . . . . . . . . . . . . . . . . 57
SECTION 12.04 Authorization by Holders of Securities . . . . . . . . . . . . . . . . . . . . 58
SECTION 12.05 Notices to Trustee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 58
SECTION 12.06 Trustee's Relation to Senior Indebtedness. . . . . . . . . . . . . . . . . . . 59
SECTION 12.07 No Impairment of Subordination . . . . . . . . . . . . . . . . . . . . . . . . 60
SECTION 12.08 Article 12 Not To Prevent Events of Default. . . . . . . . . . . . . . . . . . 60
SECTION 12.09 Paying Agents other than the Trustee . . . . . . . . . . . . . . . . . . . . . 60
SECTION 12.10 Securities Senior to Subordinated Indebtedness . . . . . . . . . . . . . . . . 60
SECTION 12.11 Holder's Relation to Senior Indebtedness . . . . . . . . . . . . . . . . . . . 60
ARTICLE 13 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.01 Trust Indenture Act Controls . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.02 Notices. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 61
SECTION 13.03 Communications by Holders with Other Holders . . . . . . . . . . . . . . . . . 62
SECTION 13.04 Certificate and Opinion as to Conditions Precedent . . . . . . . . . . . . . . 62
SECTION 13.05 Statements Required in Certificate and Opinion . . . . . . . . . . . . . . . . 63
</TABLE>
iii
<PAGE> 6
<TABLE>
<S> <C> <C>
SECTION 13.06 Rules by Trustee and Agents. . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 13.07 Record Date. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 13.08 Legal Holidays . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 13.09 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 63
SECTION 13.10 No Adverse Interpretation of Other Agreements. . . . . . . . . . . . . . . . . 64
SECTION 13.11 No Recourse Against Others . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.12 Successors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.13 Multiple Counterparts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.14 Table of Contents, Headings, etc . . . . . . . . . . . . . . . . . . . . . . . 64
SECTION 13.15 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
</TABLE>
i
<PAGE> 7
INDENTURE dated as of August __, 1995, by and between National
HealthCare L.P., a Delaware limited partnership ("Company"), and First American
National Bank, a national banking association ("Trustee").
RECITALS OF THE COMPANY
WHEREAS, the Company has duly authorized the creation of its 6.0%
Convertible Senior Subordinated Debentures due 2000 (the "Securities") and to
provide therefor the Company has duly authorized the execution and delivery of
this Indenture; and
WHEREAS, all things necessary to make the Securities, when executed by
the Company and authenticated and delivered by the Trustee hereunder and duly
issued by the Company, the valid obligations of the Company, and to make this
Indenture a valid agreement of the Company, in accordance with the terms hereof
and the terms of the Securities, have been done.
NOW THEREFORE, each party agrees as follows for the benefit of the
other party and for the equal and ratable benefit of the Holders of the
Securities:
ARTICLE 1
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions.
"Additional Interest" means any and all additional interest paid on
the Note on or before May 12, 1995 in an amount equal to the amount by which
(i) the aggregate amount of all distributions of cash or cash equivalents on or
with respect to Units ("Cash Distribution") made during the 12-month period
ending on the last day of any fiscal quarter (the "Relevant Period") and
received by a holder of the number of Units for which the Note was convertible
on the record date for such Cash Distributions, less all amounts of Additional
Interest, if any, actually paid (whether or not to the current holder) with
respect to the Note during the Relevant Period, exceeds (ii) the amount of
interest that accrued (whether or not paid) on the Note pursuant to the Note
during the Relevant Period.
"Affiliate" means any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company. For
the purposes of this definition, "control" (including, with correlative
meanings, the terms "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management or policies of
such Person, whether through the ownership of voting securities or by agreement
or otherwise.
2
<PAGE> 8
"Agent" means any Registrar, Paying Agent, Conversion Agent,
co-registrar or agent for service of notices and demands.
"Bankruptcy Law" means Title 11 of the U.S. Code or any similar
Federal or State law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Managing
General Partner of the Company or any committee of the Board.
"Board Resolution" means a resolution certified by the Secretary or an
Assistant Secretary of the Company to have been duly adopted by the Board of
Directors and to be in full force and effect on the date of such certification,
and delivered to the Trustee.
"Business Day" means any day other than a Saturday, Sunday or other
day on which commercial banks in the City of New York are authorized or
required by law or executive order to close.
"Capital Stock" means any and all shares or other equivalents (however
designated) of capital stock, including all common stock, all preferred stock
and all limited partnership units.
"Closing Price" means with respect to the Units on any day, (i) the
last reported sales price regular way or, in case no such reported sale takes
place on such day, the average of the reported closing bid and asked prices
regular way, in either case on the American Stock Exchange, or (ii) if the
Units are not listed or admitted to trading on the American Stock Exchange, the
last reported sales price regular way, or in case no such reported sale takes
place on such day, the average of the reported closing bid and asked prices
regular way, on the principal national securities exchange on which the limited
partnership units are listed or admitted to trading, or (iii) if the Units are
not listed or admitted to trading on any national securities exchange, the
average of the closing bid and asked prices as furnished by any American Stock
Exchange member firm selected from time to time by the Company for that
purpose.
"Company" means the party named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"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 of execution of this Indenture is
located at Nashville, Tennessee.
"Credit Agreement" shall mean the Loan Agreements, Indentures of
Trust, Guarantees and other documents relating to Company indebtedness with or
to State Street Bank and Trust Company of Connecticut, Third National Bank in
Nashville and/or the Toronto Dominion Bank, as any of such documents may be
amended, modified or replaced from time to time.
3
<PAGE> 9
"Current Market Price" per Unit shall mean, on any date specified
herein for the determination thereof, (a) the average daily Market Price of the
Units for the twenty trading days immediately preceding such date (if no Market
Price is available for any given trading day, such trading day shall not be
included in the determination of the Current Market Price), and (b) if the
Units are not then listed or admitted to trading on any national securities
exchange or quoted in the over-counter market, a market price per share
determined at the Company's expense by an appraiser chosen by the holders of a
majority of the Securities with the consent of the Company, which consent shall
not be unreasonably withheld or, if no such appraiser is so chosen more than
twenty business days after notice of the necessity of such calculation shall
have been delivered by the Company to the Trustee and the holders of the
Securities, then by an appraiser chosen by the Company.
"Custodian" means any receiver, trustee, liquidator or similar
official under any Bankruptcy Law.
"Default" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"Depository" means, with respect to the Securities issuable or issued
in whole or in part in global form, The Depository Trust Company, until a
successor shall have been appointed and become such pursuant to the applicable
provisions of this Indenture, and thereafter, "Depository" shall mean or
include such successor.
"Dollar" or "$" means the lawful currency of the United States of
America.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"GAAP" means generally accepted accounting principles in effect at the
time of determination.
"Holder" or "Securityholder" means the Person in whose name a Security
is registered on the Registrar's books.
"Indebtedness" means as to any Person (a) all obligations of such
Person for borrowed money (including, without limitation, reimbursement and all
other obligations with respect to surety bonds, letters of credit and bankers'
acceptances, whether or not matured), (b) all obligations evidenced by notes,
bonds, debentures or similar instruments, (c) all obligations to pay the
deferred purchase price of property or services, except trade accounts payable
and accrued liabilities arising in the ordinary course of business, (d) all
interest rate and currency swaps and similar agreements under which payments
are obligated to be made, whether periodically or upon the happening of a
contingency, (e) all indebtedness created or arising under any conditional sale
or other title retention agreement with respect to property acquired by such
Person (even though the rights and remedies of the seller
4
<PAGE> 10
or lender under such agreement in the event of default are limited to
repossession or sale of such property), (f) all obligations under leases which
have been or should be, in accordance with GAAP, recorded as capital leases,
(g) all indebtedness secured by any Lien (other than Liens in favor of lessors
under leases other than leases included in clause (f)) on any property or asset
owned or held by that Person regardless of whether the indebtedness secured
thereby shall have been assumed by that Person or is non-recourse to the credit
of that Person, and (h) any Contingent Obligation for any of the foregoing.
"Indenture" means this Indenture as originally executed or, if amended
or supplemented as provided in Article 9, as amended or supplemented from time
to time.
"Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, encumbrance, lien (statutory or other) or preference, priority or
other security interest or preferential arrangement of any kind or nature
whatsoever (including, without limitation, those created by, arising under or
evidenced by any conditional sale or other title retention agreement, the
interest of a lessor under a capitalized lease obligation, or any financing
lease having substantially the same economic effect as any of the foregoing).
"Managing General Partner" has the meaning assigned to that term in
the Amended and Restated Agreement of Limited Partnership of the Company, and,
as of the date hereof, is NHC, Inc., a Tennessee corporation.
"Market Price" shall mean, per Unit, on any date specified herein:
(a) the closing price per share of the Units on such date published in the Wall
Street Journal or, if no such closing price on such date is published in the
Wall Street Journal, the closing price on such date, as officially reported on
the principal national securities exchange on which the Units are then listed
or admitted to trading; or (b) if the Units are not then listed or admitted to
trading on any national securities exchange but are designated as a national
market system security by the National Association of Securities Dealers, Inc.,
the last trading price (the closing sale price) of the Units on such date; or
(c) if there shall have been no trading on such date or if the Units are not so
designated, the average of the reported closing bid and asked prices of the
Units, on such date as shown by the National Market System of the National
Association of Securities Dealers, Inc. Automated Quotations System (NASDAQ)
and reported by any member firm of the American Stock Exchange, Inc. selected
by the Company.
"Note" means the Note dated May 12, 1992 in the principal amount of
$30,000,000 issued by the Company and which was converted into the Securities.
"Officer" means the Chairman of the Board, the President, any Vice
President, the Treasurer, the Secretary or the Controller of the Company.
5
<PAGE> 11
"Officers' Certificate" means a certificate signed by two Officers or
by an Officer and an Assistant Treasurer, Assistant Secretary or Assistant
Controller of the Company. See Sections 13.04 and 13.05.
"Opinion of Counsel" means a written opinion from Harwell, Howard,
Gabbert & Manner or any other legal counsel who is reasonably acceptable to the
Trustee. The counsel may be an employee of or counsel to the Company or the
Trustee. See Sections 13.04 and 13.05.
"Outstanding" when used with respect to the Securities means, as of
the date of the determination, all Securities theretofore authenticated and
delivered under this Indenture except:
(a) Securities theretofore canceled by the Trustee or
the Conversion Agent or delivered to the Trustee or the Conversion Agent for
cancellation upon conversion or otherwise;
(b) Securities in exchange for or in lieu of which other
Securities have been authenticated and delivered pursuant to this Indenture,
other than any 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
Issuer;
(c) Securities discharged in accordance with Article 8 of
this Indenture; and
(d) Securities described in Section 2.08 of this
Indenture as not Outstanding;
provided, that in determining whether the Securityholders of the requisite
principal amount of Outstanding Securities are present at a meeting of
Securityholders for quorum purposes or have voted or taken or concurred in any
action under this Indenture, including the making of any request, demand,
authorization, direction, notice, consent or waiver hereunder, Securities owned
by the Company or any other obligor upon the Securities or any Affiliate of the
Company or such other obligor shall be disregarded and deemed not Outstanding,
except that, in determining whether the Trustee shall be protected in relying
upon any such determination as to the presence of a quorum or upon such
request, demand, authorization, direction, notice, consent or waiver, only
Securities which a Trust Officer of the Trustee actually knows to be so owned
shall be disregarded.
"Person" means any individual, firm, corporation, partnership, joint
venture, incorporated or unincorporated association, joint stock company,
trust, unincorporated organization, government or any agency or political
subdivision thereof or any other entity of any kind and shall include any
successor (by merger or otherwise) of such entity.
"Principal" of a Security means the principal of the Security plus,
when appropriate, the premium, if any, on the Security.
6
<PAGE> 12
"Redemption Date" when used with respect to any Security to be
redeemed, means the date fixed for such redemption pursuant to this Indenture
which date must be a Business Day.
"Redemption Price", when used with respect to any Security to be
redeemed, has the meaning assigned thereto in Section 3.01 hereof.
"Securities" means the securities in the form of Exhibit A hereto that
are issued under this Indenture as amended or supplemented from time to time,
pursuant to this Indenture.
"Senior Indebtedness" means the principal of, premium, if any, and
interest on, and any other payment due pursuant to any of the following,
whether outstanding at the date hereof or hereafter incurred or created:
(a) all indebtedness of the Company for money borrowed
arising under or in connection with any of the Credit Agreements, as amended
and as any of them may be further amended or modified from time to time, and
all renewals, extensions, refundings or refinancings of such indebtedness
incurred with financial institutions, insurance companies or other
institutional lenders, (any such indebtedness and renewals, extensions,
refundings or refinancings thereof, "Senior Institutional Indebtedness");
(b) all indebtedness of the Company for money borrowed
other than Senior Institutional Indebtedness (including, without limitation,
any indebtedness secured by a mortgage, conditional sales contract or other
lien which is (i) given to secure all or part of the purchase price of property
subject thereto, whether given to the vendor of such property or to another, or
(ii) existing on property at the time of acquisition thereof);
(c) all indebtedness of the Company evidenced by notes,
debentures, bonds or other securities sold by the Company for money;
(d) all lease obligations of the Company which are
capitalized on the books of the Company in accordance with generally accepted
accounting principles;
(e) all indebtedness of others of the kinds described in
either of the preceding clauses (b) or (c) and all lease obligations of others
of the kind described in the preceding clause (d) assumed by or guaranteed in
any manner by the Company or in effect guaranteed by the Company through an
agreement to purchase, contingent or otherwise.
(f) all indebtedness of any subsidiary of the Company or
of National Health Investors, Inc., for which the Company is liable as a
guarantor;
7
<PAGE> 13
(g) all renewals, extensions, refundings or refinancings
of indebtedness of the kinds described in any of the preceding clauses (b),
(c), (e) and (f) and all renewals or extensions of lease obligations of the
kinds described in either of the preceding clauses (d) and (e);
(h) interest accruing subsequent to the filing of a
petition initiating any bankruptcy, insolvency or similar proceeding with
respect to any indebtedness or lease obligation of the Company;
(i) all obligations of the Company in respect of any rate
hedging agreement entered into with any holder of any Senior Indebtedness; and
(j) all fees, expenses, reimbursements and other amounts
payable to holders of Senior Indebtedness under the terms of the instrument or
lease creating or evidencing the same,
unless in the case of any particular indebtedness, lease, renewal, extension,
refunding or refinancing, the instrument or lease creating or evidencing the
same or the assumption or guarantee of the same expressly provides that such
indebtedness, lease, renewal, extension, refunding or refinancing is or such
fees, expenses, reimbursements or other amounts are, not senior in right of
payment to the Securities or is or are expressly subordinate by its or their
terms in right of payment to all other indebtedness of the Company.
"Subsidiary" means, with respect to any Person, a corporation or other
entity of which 50% or more of the voting power of the voting equity securities
or equity interest is owned, directly or indirectly, by such person.
"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Section
Section 7aaa-77bbbb) as amended by the Trust Indenture Reform Act of 1990 and
as in effect on the date of this Indenture.
"Trustee" means the entity named as such in this Indenture until a
successor replaces it pursuant to this Indenture and thereafter means the
successor.
"Trust Officer", when used with respect to the Trustee, means the
chairman or any vice-chairman of the board of directors, the chairman or any
vice-chairman of the executive committee of the board of directors, the
chairman of the trust committee, the president, any vice-president, the
secretary, any assistant secretary, the treasurer, any assistant treasurer, the
cashier, any assistant cashier, any Trust Officer or assistant Trust Officer,
the controller or any assistant 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 of the Trustee to whom such matter is referred
because of his knowledge of and familiarity with the particular subject.
"United States" means the United States of America.
8
<PAGE> 14
"Units" means the limited partnership units of the Company.
SECTION 1.02 Other Definitions.
<TABLE>
<CAPTION>
Term Defined in Section
---- ------------------
<S> <C>
"Change of Control" 11.01
"Change of Control Offer" 11.01
"Company Order" 2.03
"Continuing Director" 11.02
"Conversion Agent" 2.04
"Conversion Price" 10.01
"Current Management" 11.02
"Event of Default" 6.01
"Legal Holiday" 13.08
"Paying Agent" 2.04
"Payment or Distribution" 12.01
"Recovery Amount" 3.01
"Redemption Price" 3.01
"Registrar" 2.04
"Regular Distribution" 10.04
"Relevant Period" 1.01
"Rule 13e-3 Transaction" 10.06
"Securities" Recitals
"U.S. Government Obligations" 8.01
</TABLE>
SECTION 1.03 Incorporation by Reference to Trust Indenture Act.
Whenever this Indenture refers to a provision of the Trust Indenture
Act of 1939 (the "TIA"), the provision is incorporated by reference in and made
a part of this Indenture. The following TIA terms used in this Indenture have
the following meanings:
"Commission" means the Securities and Exchange Commission.
"indenture securities" means the Securities.
"indenture security holder" means a Securityholder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company or any other
obligor on the indenture securities.
9
<PAGE> 15
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by Commission rules have
the meanings assigned to them therein.
SECTION 1.04 Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with United States generally accepted accounting principles
in effect as of the time as to which such accounting principles are to be
applied;
(3) "or" is not exclusive; and
(4) words in the singular include the plural, and in the plural
include the singular.
ARTICLE 2
THE SECURITIES
SECTION 2.01 Dating; Incorporation of Form in Indenture.
The Securities and the Trustee's certificate of authentication shall
be substantially in the form of Exhibit A which is incorporated in and made
part of this Indenture. The Securities may have notations, legends or
endorsements required by law, stock exchange rules, agreements to which the
Company is subject, or usage. The Company shall approve the form of the
Securities and any notation, legend or endorsement on them. Each Security
shall be dated the date of its authentication.
The terms and provisions contained in the Securities shall constitute,
and are hereby expressly made, a part of this Indenture, and to the extent
applicable, the Company and the Trustee, by their execution and delivery of
this Indenture, expressly agree to such terms and provisions to be bound
thereby.
SECTION 2.02 Execution and Authentication.
Two Officers shall sign the Securities for the Company by manual or
facsimile signature. The Company's seal shall be impressed, affixed, imprinted
or reproduced on the Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates the Security, the Security shall
nevertheless be valid.
10
<PAGE> 16
A Security shall not be valid until the Trustee manually signs the
certificate of authentication on the Security. Such signature shall be
conclusive evidence that the Security has been authenticated under this
Indenture.
The Trustee shall authenticate Securities for original issue in the
aggregate principal amount of up to $30,000,000 upon execution of the Indenture
and a written order or orders of the Company signed by two Officers or by an
Officer and an Assistant Treasurer of the Company (a "Company Order"). The
aggregate principal amount of securities Outstanding at any time may not exceed
that amount except as provided in Section 2.07.
The Trustee may appoint (at the expense of the Company) an
authenticating agent to authenticate Securities. An authenticating agent may
authenticate Securities whenever the Trustee may do so. Each reference in this
Indenture to authentication by the Trustee includes authentication by such
agent. An authenticating agent has the same rights as an Agent to deal with
the Company or an Affiliate.
The Securities may be issued in registered form without coupons. The
Securities shall be issuable only in denominations of $1,000 principal amount
and any integral multiple thereof.
SECTION 2.03 Global Securities.
The Securities may be issued initially in the form of one or more
permanent global securities in definitive, fully registered form without
interest coupons, with the global securities legend (a "Global Security"),
which shall be deposited on behalf of the purchasers of the Securities
represented thereby with the Trustee, at its New York office, as custodian for
the Depository, and registered in the name of the Depository or a nominee of
the Depository, duly executed by the Company and authenticated by the Trustee
as hereinafter provided. The aggregate principal amount of the Global
Securities may from time to time be increased or decreased by adjustments made
on the records of the Trustee and the Depository or its nominee as hereinafter
provided.
The Company shall execute and the Trustee shall, upon receipt of an
Officers' Certificate, in accordance with this Section 2.03 and Section 2.02,
authenticate and deliver initially one or more Global Securities that (a) shall
be registered in the name of the Depository for such Global Security or Global
Securities or the nominee of such Depository and (b) shall be delivered by the
Trustee to such Depository or pursuant to such Depository's instructions or
held by the Trustee as custodian for the Depository.
Members of, or participants in, the Depository ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security held on
their behalf by the Depository or by the Trustee as the custodian or the
Depository or under such Global Security, and the Depository may be treated by
the Company, the Trustee and any agent of the Company or the Trustee as the
absolute owner of such Global Security for all purposes whatsoever.
Notwithstanding the foregoing, nothing
11
<PAGE> 17
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 the Depository or impair, as between the Depository
and its Agent Members, the operation of customary practices of such Depository
governing the exercise of the rights of a holder of a beneficial interest in
any Global Security.
Except as otherwise specifically provided, owners of beneficial
interests in Global Securities will not be entitled to receive physical
delivery of definitive Securities.
SECTION 2.04 Registrar and Agents.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for exchange ("Registrar"), an office
or agency where Securities may be presented for payment ("Paying Agent"), an
office or agency where Securities may be presented for conversion ("Conversion
Agent") and an office or agency where notices and demands to or upon the
Company in respect of the Securities and this Indenture may be served. The
Registrar shall keep a register of the Securities and of their transfer and
exchange. The Company may have one or more co-registrars, one or more
additional Paying Agents and one or more additional Conversion Agents. The
Company or any Subsidiary may act as Paying Agent and/or Conversion Agent. The
term "Paying Agent" includes any additional paying agent and the term
"Conversion Agent" includes any additional conversion agent.
The Company may change any Paying Agent, Registrar, Conversion Agent
or Co-Registrar on sixty (60) days' prior written notice to the Trustee. The
Company shall notify the Trustee in writing of the name and address of any such
Agent. If the Company fails to maintain a Registrar, Paying Agent, Conversion
Agent or agent for service of notices and demands, or fails to give the
foregoing notice, the Trustee shall act as such.
The Company initially appoints the Trustee as Registrar, Paying Agent,
Conversion Agent and agent for service of notices and demands.
SECTION 2.05 Paying Agent to Hold Money in Trust.
Prior to each due date of the principal of, premium if any, and
interest on any Securities, the Company shall deposit with each Paying Agent a
sum sufficient to pay such principal, premium, if any, and interest so becoming
due. The Company shall require each Paying Agent other than the Trustee to
agree in writing that it will hold in trust for the benefit of Holders of
Securities or the Trustee all money held by the Paying Agent for the payment of
principal of, premium if any, or interest on the Securities and to notify the
Trustee in writing of any default by the Company (or any other obligor on the
Securities) in making any such payment. If the Company or a Subsidiary acts as
Paying Agent, it shall on or before each due date of the principal of, premium,
if any, or interest on any Securities segregate the money and hold it as a
separate trust fund. The Company at any time
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may require a Paying Agent to pay all money held by it to the Trustee and the
Trustee may at any time during the continuance of any payment default, upon
written request to a Paying Agent, require such Paying Agent to forthwith pay
to the Trustee all sums so held in trust by such Paying Agent. Upon doing so,
the Paying Agent (other than the Company or a Subsidiary thereof) shall have no
further liability for the money.
The final installment of principal of and premium, if any, on this
Security shall be payable only upon surrender of this Security at the address
of the Trustee's Corporate Trust Office in New York, New York. Payments of
principal of and premium, if any, and interest on this Security shall be made
at the address of the Trustee's Corporate Trust Office in New York, New York,
or, in the case of any such payments other than the final payment of principal
and premium, if any, at the Company's option, by check mailed to the Person
entitled thereto at such Person's address last appearing on the Company's
register.
SECTION 2.06 Transfer and Exchange.
When a Security is presented to the Registrar or a co-registrar with a
request to register the transfer, the Registrar or co-registrar shall register
the transfer as requested and when Securities are presented to the Registrar or
a co-registrar with a request to exchange them for a like aggregate principal
amount of Securities in other authorized denominations, the Registrar shall
make the exchange as requested, provided that every Security presented or
surrendered for registration or transfer or exchange shall be duly endorsed, or
be accompanied by a written instrument of transfer in form satisfactory to the
Company and the Registrar duly executed by the Holder thereof or his
attorney-in-fact duly authorized in writing. To permit registrations of
transfers and exchanges, the Company shall issue and the Trustee or any
authenticating agent shall authenticate Securities at the Registrar's or
co-registrar's written request. No service charge shall be made to a
Securityholder 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 relation thereto, but this provision
shall not apply to any exchange pursuant to Section 2.09, 3.06, 9.05 or 10.02
not involving any transfer.
The Registrar shall not be required (i) to issue, register the
transfer of, or exchange Securities during a period beginning at the opening of
business 15 days before the day of any selection of Securities for redemption
under Section 3.02 and ending at the close of business on the day of selection,
(ii) to register the transfer or exchange of any Security so selected for
redemption in whole or in part, except the unredeemed portion of any Security
being redeemed in part, or (iii) to register the transfer or exchange of any
Securities during a period beginning at the opening of business 15 days before
the day of any selection of Securities for redemption under Section 3.02 and
ending at the close of business on the day interest is to be paid on
Securities.
SECTION 2.07 Replacement Securities.
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If a mutilated Security is surrendered to the Trustee or if the Holder
of a Security presents evidence to the satisfaction of the Company and the
Trustee that the Security has been lost, destroyed or wrongfully taken, the
Company shall issue and the Trustee shall authenticate a replacement Security
if the requirements of the Trustee and the Company are met. An indemnity bond
may be required by the Company or the Trustee that is sufficient in the
judgment of the Company to protect the Company and is sufficient in the
judgment of the Trustee to protect the Trustee or any Agent from any loss which
it may suffer if a Security is replaced. The Company may charge for its
expense in replacing a Security.
In case any such mutilated, destroyed, lost or stolen Security has
become or is about to become due and payable, the Company in its sole
discretion may, instead of issuing a new Security, pay or authorize the payment
or convert or authorize the conversion of such Security.
Every new Security issued pursuant to this Section in lieu of any
destroyed, lost or stolen Security shall constitute an original additional
contractual obligation of the Company, whether or not the destroyed, lost or
stolen Security shall be at any time enforceable by anyone, and shall be
entitled to all the benefits of this Indenture equally and proportionately with
any and all other Securities duly issued hereunder.
SECTION 2.08 Outstanding Securities.
Securities Outstanding at any time are all Securities authenticated by
the Trustee except for those canceled by it, those delivered to it for
cancellation and those described in this Section 2.08 as not Outstanding.
If a Security is replaced pursuant to Section 2.07, it ceases to be
Outstanding until the Trustee receives proof satisfactory to it that the
replaced Security is held by a bona fide purchaser.
If the Paying Agent (other than the Company or a Subsidiary) holds on
a Redemption Date or maturity date money deposited with it by or on behalf of
the Company sufficient to pay the principal of and accrued interest on
Securities payable on that date, then on and after that date such Securities
cease to be Outstanding and interest on them ceases to accrue.
A Security does not cease to be Outstanding because the Company or an
Affiliate holds the Security.
SECTION 2.09 Temporary Securities.
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities. Temporary
Securities shall be substantially in the form of definitive Securities but may
have non-material variations that the Company considers appropriate for
temporary Securities. Without unreasonable delay, the Company shall prepare
and the Trustee
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shall authenticate definitive Securities in exchange for temporary Securities
upon written order of the Company signed by two Officers. Until so exchanged,
temporary Securities represent the same rights as definitive Securities. Upon
request of the Trustee, the Company shall provide a certificate to the effect
that the temporary Securities meet the requirements of the second sentence of
this Section 2.09.
SECTION 2.10 Cancellation.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar, the Paying Agent and the Conversion Agent shall
forward to the Trustee any Securities surrendered to them for transfer,
exchange, payment or conversion. The Trustee shall cancel all Securities
surrendered for transfer, exchange, payment or conversion and destroy canceled
Securities in accordance with its customary destruction procedures and deliver
a certificate of such destruction to the Company unless the Company directs the
Trustee in writing prior to such destruction to deliver canceled Securities to
the Company. Subject to Sections 2.07, 3.06 and the second paragraph of
Section 10.02, the Company may not issue Securities to replace Securities that
it has previously paid or delivered to the Trustee for cancellation or that a
Securityholder has converted pursuant to Article 10 hereof.
SECTION 2.11 Defaulted Interest.
If the Company defaults in a payment of interest on Securities, it
shall pay the defaulted interest to the Persons who are Holders of the
Securities on a subsequent special record date. After the deposit by the
Company with the Trustee of money sufficient to pay such defaulted interest,
the Trustee shall fix the record date and payment date. Each such special
record date shall be not less than 10 days prior to such payment date. Each
such payment date shall be not more than 60 days after the deposit by the
Company of money to pay the defaulted interest. At least 15 days before the
special record date, the Company shall mail to each Holder of a Security a
notice that states the special record date, the payment date, and the amount of
defaulted interest to be paid. The Company may pay defaulted interest in any
other lawful manner if, after prior notice to the Trustee, such payment shall
be deemed operationally practicable by the Trustee.
SECTION 2.12 Securityholder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
Holders of Securities. If the Trustee is not the Registrar, the Company or
other obligor, if any, shall furnish to the Trustee at least seven Business
Days prior to each quarterly interest payment date and at such other times as
the Trustee may request in writing a list in such form and as of such date as
the Trustee may reasonably require of the names and addresses of Holders of
Securities upon which the Trustee may conclusively rely. The Trustee may
destroy any such list upon receipt of a replacement list. The Paying Agent
will solicit from each Securityholder a certification of social security number
or taxpayer identification number in
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accordance with its customary practice and as required by law, unless the
Paying Agent is in possession of such certification. Each Paying Agent is
authorized to impose back-up withholding with respect to payments to be made to
Securityholders to the extent required by law.
SECTION 2.13 Persons Deemed Owners.
Prior to presentment of a 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 Security is registered as the owner of such Security
and neither the Company, the Trustee nor any agent of the Company or the
Trustee shall be affected by notice to the contrary.
SECTION 2.14 CUSIP Number.
The Company may use a "CUSIP" number when issuing Securities, and if
so, the Trustee may use the CUSIP number in notices of redemption or exchange
as a convenience to Holders of such Securities; provided, that any such notice
may state that no representation is made as to the correctness or accuracy of
the CUSIP number printed in the notice or on the Securities, and that reliance
may be placed only on the other identification numbers printed on the
Securities.
ARTICLE 3
REDEMPTION
SECTION 3.01 Right of Redemption; Notices to Trustee.
(a) Except as otherwise provided herein and in the Securities, the
Company shall not have any right to prepay or redeem the Securities. On and
after January 1, 1998 or, if the Company shall have elected to be taxable as a
corporation and as of the Redemption Date the Current Market Price of the
aggregate number of Units into which the Securities to be redeemed shall be
convertible as of the Redemption Date shall equal or exceed the Recovery Amount
(defined below), on or after May 12, 1996, the Company shall have the right, at
any time and from time to time at its sole option and election, to redeem the
Securities, in whole or in part, in integral multiples of $10,000,000 by
Outstanding principal amount at a price (the "Redemption Price") equal to (i)
the Outstanding principal amount of the Securities to be redeemed plus (ii) an
amount equal to all accrued and unpaid interest thereon, whether or not
currently payable, to the applicable Redemption Date, in cash or other
immediately available funds. For purposes hereof, "Recovery Amount" shall mean
the amount by which (i) the amount that results from compounding the principal
amount of the Securities to be redeemed at a rate of 25 percent per annum from
the date of issuance of the Securities to the Redemption Date exceeds (ii) the
amount that results from compounding all amounts of interest paid, including
Additional Interest, and other distributions made with respect to the principal
amount of the Securities to be redeemed on or prior to the Redemption Date at a
rate of 25 percent per annum from, in the case of each such payment of interest
or other distribution, the date such payment or
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other distribution is made to the Redemption Date. The election of the Company
to redeem any Securities pursuant to this Section shall be evidenced by a Board
Resolution. The Company shall, at least 30, but not more than 60, days prior
to the Redemption Date which shall be a Business Day fixed by the Company
(unless a shorter period shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date and, in the case of any redemption at the
election of the Company of less than all the Securities, of the principal
amount of Securities to be redeemed.
(b) If the Company wants to redeem the Securities pursuant to the
optional redemption provisions of this Section 3.01, it shall notify the
Trustee of the Redemption Date and the principal amount of Securities to be
redeemed. The notice shall be in writing and accompanied by an Officers'
Certificate stating that the redemption complies with the provisions of this
Indenture and the provisions of the applicable Board Resolution, if any, and in
the Securities.
SECTION 3.02 Selection of Securities to be Redeemed.
If less than all the Securities are to be redeemed by the Company on
the Redemption Date, the Trustee shall select the Securities to be redeemed in
the manner required by the principal securities exchange on which the
Securities are then listed for trading or, if the Securities are not so listed
or no manner of selection is required, pro rata based on the registered
holdings of each Holder. The Trustee shall promptly notify the Company of the
Securities to be so called for redemption. The Trustee shall make the
selection from Securities Outstanding and not previously called for redemption.
The Trustee may select for redemption portions of the principal of Securities
that have denominations larger than $1,000 principal amount. Securities and
portions thereof selected shall aggregate at least $10,000,000 in principal
amount. Provisions of this Indenture that apply to Securities called for
redemption also apply to portions of Securities called for redemption. The
Trustee's selection of Securities for redemption by any method authorized by
this Section 3.02 shall be conclusively deemed reasonable.
Upon any redemption of less than all the Securities, the Company and
the Trustee, for the purpose of selecting Securities to be redeemed, may treat
as Outstanding any Securities surrendered for conversion during the period of
15 days next preceding the selection of the Securities and need not treat as
Outstanding any Security authenticated and delivered during such period in
exchange for the unconverted portion of any Security converted in part during
such period.
SECTION 3.03 Notice of Redemption by the Company.
At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail a notice of redemption by first-class mail to each
Holder of Securities to be redeemed.
In order to facilitate the redemption of the Securities, the Board of
Directors may fix a record date for the determination of the Securities to be
redeemed, or may cause the transfer books of the
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Company for the Securities to be closed, not more than 60 days or less than 30
days prior to the date fixed for such redemption.
The notice shall identify the Securities to be redeemed and shall
state:
(1) the Redemption Date;
(2) the Redemption Price;
(3) the Conversion Price;
(4) the name and address of the Paying Agent and the Conversion
Agent;
(5) that Securities called for redemption must be surrendered to
the Paying Agent to collect the Redemption Price;
(6) that interest on Securities called for redemption ceases to
accrue on and after the Redemption Date;
(7) if any Security is being redeemed in part, the portion of the
principal amount of such Security to be redeemed and that,
after the Redemption Date, upon surrender of such Security, a
new Security or Securities in principal amount equal to the
unredeemed portion thereof will be issued;
(8) any conversion rights with respect to the Securities and the
applicable procedures required to be followed in connection
with a conversion of Securities; and
(9) that Securities called for redemption may be converted at any
time before the close of business on the Redemption Date and,
if not converted prior to the close of business on the
Redemption Date, the right of conversion will be lost.
At the Company's written request, the Trustee shall give the notice of
redemption in the Company's name and at the Company's expense. If a CUSIP
number is listed in such notice or printed on the Security, the notice shall
state that no representation is made as to the correctness or accuracy of such
CUSIP number.
SECTION 3.04 Effect of Notice of Redemption.
Once notice of redemption is mailed, Securities called for redemption
become due and payable on the applicable Redemption Date and at the applicable
Redemption Price. Upon surrender to the Paying Agent, such Securities shall be
paid at the Redemption Price, plus accrued interest to the Redemption Date.
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SECTION 3.05 Deposit of Redemption Price.
On or before the Redemption Date with respect to the Securities, the
Company shall deposit with the Paying Agent (which for purposes of this Section
only shall be a bank or trust company in the Borough of Manhattan, the City of
New York, having a capital and surplus of at least $100,000,000) in immediately
available funds money sufficient to pay the Redemption Price of and accrued
interest on all Securities to be redeemed on that date. The Trustee or the
Paying Agent shall return to the Company any money so received not required for
that purpose.
SECTION 3.06 Securities Redeemed in Part.
Upon surrender of a Security that is redeemed in part, the Trustee
shall authenticate for the Holder, at the expense of the Company, a new
Security equal in principal amount to the unredeemed portion of the Security
surrendered.
SECTION 3.07 Termination of Rights.
Notice of redemption having been given as aforesaid, upon the deposit
of funds pursuant to Section 3.05 in respect of Securities to be redeemed
pursuant to Section 3.01, notwithstanding that any such Securities themselves
shall not have been surrendered for cancellation, from and after the date of
redemption designated in the notice of redemption (i) that portion of the
principal amount of the Securities that is to be redeemed shall no longer be
deemed Outstanding, (ii) the rights to receive interest thereon shall cease to
accrue and (iii) all rights of the Holders of Securities to be redeemed shall
cease and terminate with respect to that portion of the principal amount of the
Securities that is to be redeemed, excepting only the right to receive the
Redemption price therefor and the right to convert such Securities into Units
until the close of business on the Redemption Date, in accordance with Article
10; provided, however, that if the Company shall default in the payment of the
Redemption Price, that portion of the principal amount of the Securities that
was to be redeemed shall thereafter be deemed to be Outstanding and the Holders
thereof shall have all of the rights of a Holder of Securities until such time
as such default shall no longer be continuing or shall have been waived by
Holders of at least 66-2/3% of the then Outstanding principal amount of all
Securities.
ARTICLE 4
COVENANTS
SECTION 4.01 Payment of the Securities.
The Company shall pay the principal of, premium, if any, and interest
on the Securities on the dates and in the manner provided in the Securities and
this Indenture in immediately available
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funds in Dollars. An installment of principal, premium, if any, or interest
shall be considered paid on the date it is due if the Trustee or Paying Agent
(other than the Company or a Subsidiary) holds on that date money designated
for and sufficient to pay the installment. The Company shall pay interest on
overdue principal and premium, if any, at the rate borne by the Security; it
shall pay interest, including post-petition interest in the event of a
proceeding under the Bankruptcy Laws, on overdue installments of interest at
the same rate to the extent lawful.
SECTION 4.02 Commission Reports.
So long as the Securities remain Outstanding, the Company shall file
with the Trustee and mail to the Holders at their addresses appearing in the
register of Securities maintained by the Registrar, promptly after it files
them 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 by rules and regulations prescribe) which the Company is
required to file with the Commission pursuant to Section 13 or 15(d) of the
Exchange Act. If at anytime the Company is not subject to Section 13 or 15(d)
of the Exchange Act, upon the request of a Holder, the Company shall deliver to
such Holder information of the type that would satisfy the requirement of
subsection (d)(4)(i) of Rule 144A (or any similar successor provision) under
the Securities Act of 1933, as amended. The Company shall also comply with the
other provisions of TIA Section 314(a).
So long as the Securities remain Outstanding, the Company shall cause
its annual reports to shareholders (containing audited financial statements)
and any other financial reports furnished by it to shareholders to be mailed to
the Holders at their addresses appearing in the register of Securities
maintained by the Registrar.
SECTION 4.03 Distributions.
In the event that the Company shall declare a dividend or make any
other distribution (including, without limitation, in capital stock (which
shall include, without limitation, any options, warrants or other rights to
acquire capital stock) of the Company, whether or not pursuant to a shareholder
rights plan, "poison pill" or similar arrangement, or other property or assets)
on or with respect to the Units other than a Regular Distribution,
distributions that result in the payment of Additional Interest or a dividend
or distribution paid solely in Units, then the Board of Directors shall
declare, and the Holders shall be entitled to receive, a distribution in an
amount equal to the amount of such dividend or distribution received by a
holder of the number of Units into which the Securities are convertible on the
record date for such dividend or distribution. Any such amount shall be paid
to the Holders at the same time such dividend or distribution is made to
holders of Units.
SECTION 4.04 Notice of Default.
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The Company will, so long as any Securities are Outstanding, deliver
to the Trustee, within 10 days of becoming aware of any Default or Event of
Default in the performance of any covenant, agreement or condition in this
Indenture, an Officers' Certificate specifying such Default or Event of
Default, the period of existence thereof and what action the Company is taking
or proposes to take with respect thereto.
SECTION 4.05 Compliance Certificates.
The Company will deliver to the Trustee, within 120 days after the end
of each fiscal year of the Company (which as of the date hereof is December
31), a written statement signed by the principal executive officer, principal
financial officer or principal accounting officer of the Company, stating, as
to each signer thereof, that:
(1) a review of the activities of the Company during such year and of
performance under this Indenture has been made under his supervision;
(2) to the best of his knowledge, based on such review, the Company
has kept, observed, performed and fulfilled in all material respects each and
every condition and covenant contained in this Indenture throughout such year,
or, if there has been a default in the fulfillment of any such condition or
covenant, specifying each such default known to him and the nature and status
thereof; and
(3) the conversion price then in effect.
The Company will give the Trustee written notice of a change in the
fiscal year of the Company, within a reasonable time after such change is
effected.
SECTION 4.06 Reserved.
SECTION 4.07 Additional Indebtedness.
The Company hereby covenants and agrees that, so long as any amount is
outstanding on any of the Securities, the Company will not, without the consent
of a majority in outstanding principal amount of the Securities, create,
assume, incur or in any manner become or remain liable in respect of any
Indebtedness other than Senior Indebtedness, that by its terms is expressly
subordinate in right of payment to the Senior Indebtedness unless by its terms
such Indebtedness is expressly junior to, or pari passu with, the Securities in
right of payment.
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SECTION 4.08 Preservation of Existence.
The Company shall, and shall cause each of its Subsidiaries to:
(a) preserve and maintain in full force and effect its
partnership or corporate existence and good standing under the laws of its
jurisdiction or organization except as permitted by Section 4.12;
(b) preserve and maintain in full force and effect all
material rights, privileges, qualifications, licenses and franchises necessary
in the normal conduct of its business; and
(c) use its reasonable efforts to preserve its business
organization.
SECTION 4.09 Payment of Obligations.
The Company shall, and shall cause its Subsidiaries to, pay and
discharge as the same shall become due and payable, all their respective
obligations and liabilities, including without limitation:
(a) all tax liabilities, assessments and governmental
charges or levies upon it or its properties or assets, unless the same are
being contested in good faith by appropriate proceedings and adequate reserves
in accordance with GAAP are being maintained by the Company or such Subsidiary;
(b) all lawful claims which the Company and each of its
Subsidiaries is obligated to pay, which are due and which, if unpaid, might by
law become a lien upon its property; and
(c) all payments of principal and interest when due
(giving effect to any grace periods relating thereto) on Indebtedness.
SECTION 4.10 Compliance with Laws.
The Company shall comply, and shall cause each Subsidiary to comply,
in all material respects with all requirements of law and with the directions
of any governmental authority having jurisdiction over it or its business,
except such as to which such failure to comply would not have a material
adverse effect on the condition of the Company.
SECTION 4.11 Registration and Listing.
The Company will in good faith endeavor to maintain the registration
of the Units reserved for conversion of the Securities under Federal Securities
Laws or state or other applicable law. So long as the Units are listed on the
American Stock Exchange or quoted or listed on any other national securities
exchange, the Company will, if permitted by the rules of such system or
exchange, quote
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or list and keep quoted or listed on such exchange, upon official notice of
issuance, all Units issuable or deliverable upon conversion of the Securities.
SECTION 4.12 Transactions with Affiliates.
The Company shall not, and shall not permit any of its Subsidiaries
to, enter into any transaction with any Affiliate of the Company or of any such
Subsidiary, except in the ordinary course of business and pursuant to the
reasonable requirements of the business of the Company or such Subsidiary and
on terms no less favorable to the Company or such Subsidiary than those the
Company or such Subsidiary would obtain in a comparable arm's-length
transaction with a Person not an Affiliate of the Company or such Subsidiary;
provided, however, that National Health Investors, Inc. shall not be
considered an Affiliate of the Company or any of its Subsidiaries for purposes
of this Section 4.12.
SECTION 4.13 No Inconsistent Agreements.
Neither the Company nor any of its Subsidiaries shall enter into any
loan or other agreement, or enter into any amendment or other modification to
any currently existing agreement, which by its terms restricts or prohibits the
ability of the Company to issue Units upon conversion of the Securities or to
pay interest on the Securities in accordance with this Indenture and terms of
the Securities; provided, however, that the foregoing shall not prevent the
Company from entering into loan or other agreements that contain, or any
amendment or other modification to any currently existing credit agreement to
provide, restrictions on the ability of the Company to optionally redeem or
prepay the Securities, following the occurrence of a default or event of
default under such agreements.
ARTICLE 5
SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge, etc.
The Company shall not merge, consolidate with or into, or convey,
transfer, lease or otherwise dispose of (whether in one transaction or in a
series of transactions) all or substantially all of its assets (whenever
acquired), and the Company shall not allow any of its Subsidiaries to merge or
consolidate with or into any other Person except another Subsidiary of the
Company, except that the Company may consolidate or merge with or into, or sell
all or substantially all of its assets to, any Person if: (i) the resulting,
surviving or transferee Person is a solvent corporation or partnership which
assumes by supplemental indenture all the obligations of the Company under the
Securities and this Indenture; (ii) such corporation or partnership is
organized and existing under the laws of the United States, a State thereof or
the District of Columbia although it in turn may be owned by a foreign entity;
(iii) immediately after giving effect to such transaction no Default or Event
of
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Default shall have happened and be continuing, and the Officers' Certificate
referred to in the following clause reflects that such Officers are not aware
of any such Default or Event of Default that shall have happened and be
continuing, (iv) the resulting, surviving or transferee Person shall have a
consolidated net worth at least equal to the consolidated net worth of the
Company immediately prior to such transaction and (v) the Company shall have
delivered to the Trustee an Officers' Certificate and an Opinion of Counsel,
each stating that such consolidation, merger or transfer and such supplemental
indenture comply with this Indenture, and thereafter all obligations of the
Company shall terminate.
SECTION 5.02 Successor Corporation or Trust Substituted.
Upon any consolidation or merger, or any transfer of all or
substantially all of the assets of the Company in accordance with Section 5.01,
the successor corporation or trust formed by such consolidation or into which
the Company is merged or to which such transfer is made shall succeed to, and
be substituted for, and may exercise every right and power of, the Company
under this Indenture with the same effect as if such successor corporation or
trust has been named as the Company herein. The Company shall thereupon be
relieved of any further obligation or liability hereunder or upon the
Securities; and the Company as the predecessor corporation may thereupon or at
any time thereafter be dissolved, wound up or liquidated. Such successor
corporation thereupon may cause to be signed, and may issue either in its own
name or in the name of National HealthCare L.P., 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 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 such Securities had been issued at the date of the
execution hereof.
ARTICLE 6
DEFAULTS AND REMEDIES
SECTION 6.01 Events of Default.
An "Event of Default" shall occur if:
(1) the Company defaults in the payment of interest on
the Securities when the same becomes due and payable and such default continues
for a period of 15 Business Days, whether or not such payment shall be
prohibited by the provisions of Section 12 hereof;
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(2) the Company defaults in the payment of principal of
the Securities when the same becomes due and payable at maturity, upon
redemption (including pursuant to Section 11.01) or otherwise, whether or not
such payment shall be prohibited by the provisions of Section 12 hereof;
(3) the Company fails to comply with any agreements or
covenants (other than those referred to in clauses 1 or 2 above) in this
Indenture or the Securities and, if such failure is capable of being remedied,
such failure continues unremedied for 30 days (or if, despite the Company's
good faith efforts to remedy such failure, such failure is not remedied within
such 30 day period, then if such failure continues unremedied for an additional
60 days) after notice thereof by the Holders of a majority of the then
outstanding principal amount of the Securities;
(4) the Company or any of its Subsidiaries pursuant to or
within the meaning of any United States bankruptcy laws or any applicable
bankruptcy, insolvency or similar laws of any other country (a "Bankruptcy
Law"):
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief
against it in an involuntary case,
(iii) consents to the appointment of a Custodian of
it or for all or substantially all of its property, or
(iv) makes a general assignment for the benefit of
its creditors;
(5) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that:
(i) is for relief against the Company or any of
its Subsidiaries in an involuntary case,
(ii) appoints a Custodian of the Company or any of
its Subsidiaries or for all or substantially all of its
property, or
(iii) orders the winding up or liquidation of the
Company or any of its Subsidiaries and the order or decree
remains unstayed and in effect for 60 days;
(6) the Company or any of its Subsidiaries defaults in
the payment of Indebtedness aggregating in excess of $10,000,000 when due,
after any grace periods with respect thereto shall have expired and upon
non-waiver by the holders of any such Indebtedness and such default continues
unremedied for 30 days, or there has been an acceleration of in excess of
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$10,000,000 aggregate principal amount of Indebtedness of the Company by the
holder thereof following an event of default as defined in any mortgage,
indenture, agreement or instrument under which there may be issued or by which
there may be secured or evidenced such Indebtedness of the Company, whether
such Indebtedness now exists or shall hereafter be created; or
(7) a judgment for the payment of money the uninsured
portion of which exceeds $10,000,000 shall be rendered against the Company or
any of its Subsidiaries and shall remain undischarged for a period (during
which execution shall not be effectively stayed) of 60 days after the date on
which the judgment has been rendered, unless (i) no proceeding for execution of
such judgment has been commenced or (ii) any such proceeding has been stayed.
SECTION 6.02 Acceleration.
If an Event of Default (other than an Event of Default specified in
Section 6.01(4) or 6.01(5)) occurs and is continuing with respect to any
Securities, the Trustee by notice to the Company, or the Holders of a majority
in principal amount of the Securities then Outstanding by notice to the Company
and the Trustee, may declare to be due and payable immediately the principal
amount of the Securities plus accrued interest to the date of acceleration.
Upon any such declaration, such amount shall be due and payable immediately,
and upon payment of such amount all of the Company's obligations with respect
to the Securities, other than obligations under Section 7.07, shall terminate.
If an Event of Default specified in Section 6.01(4) or 6.01(5) occurs, all
unpaid principal and accrued interest on the Securities then Outstanding shall
become and be immediately due and payable without any declaration on the act on
the part of the Trustee or any Holder. The Holders of a majority in principal
amount of the Outstanding Securities by written notice to the Trustee may
rescind an acceleration and its consequences if (x) all existing Events of
Default with respect to the Securities, other than the non-payment of the
principal of the Securities, which have become due solely by such declaration
of acceleration, have been cured or waived, (y) to the extent the payment of
such interest is lawful, interest on overdue installments of interest and
overdue principal which has become due otherwise than by such declaration of
acceleration, has been paid, and (z) the rescission would not conflict with any
judgment or decree of a court of competent jurisdiction. The Trustee may rely
upon such notice of rescission without any independent investigation as to the
satisfaction of conditions (x), (y) and (z).
SECTION 6.03 Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may
pursue any available remedy by proceeding at law or in equity to collect the
payment of principal (and premium, if any) or interest on the Securities or to
enforce the performance of any provision of the Securities or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay
or omission by the Trustee or any Securityholder in exercising any right or
remedy accruing upon an Event of Default shall not impair
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the right or remedy or constitute a waiver of or acquiescence in the Event of
Default. No remedy is exclusive of any other remedy. All available remedies
are cumulative.
SECTION 6.04 Waiver of Defaults and Events of Default.
Subject to Section 9.02, the Holders of a majority in principal amount
of the Securities then Outstanding, on behalf of the Holders of the Securities,
by written notice to the Trustee may waive a Default or Event of Default with
respect to the Securities and its consequences. When a Default or Event of
Default is waived with respect to the Securities, it is cured and ceases; but
no such waiver shall extend to any subsequent or other Default or impair any
right consequent thereon.
SECTION 6.05 Control by Majority.
The Holders of a majority in principal amount of the Securities then
Outstanding may direct in writing the time, method and place of conducting any
proceeding for any remedy available to the Trustee or the Holders, or for
exercising any trust or power conferred on the Trustee. The Trustee, however,
may refuse to follow any direction that conflicts with law or this Indenture,
that the Trustee determines may be unduly prejudicial to the rights of other
Securityholders, it being understood that (subject to Section 7.01) the Trustee
shall have no duty to ascertain whether or not such actions or forebearances
are unduly prejudicial to such Securityholders or that may involve the Trustee
in personal liability or for which the Trustee does not have adequate
indemnification pursuant to Section 7.01(e); provided, that, the Trustee may
take any other action deemed proper by the Trustee which is not inconsistent
with such direction.
SECTION 6.06 Rights of Holders to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of
any Holder of a Security to receive payment of principal of, premium, if any,
and interest on such Security, on or after the respective due dates expressed
in such Security, or to bring suit for the enforcement of any such payment on
or after such respective dates, is absolute and unconditional and shall not be
impaired or affected without the consent of the Holder.
Notwithstanding any other provision of this Indenture (other than
Section 3.01), the right of any Holder of any Security to convert such Security
or to bring suit for the enforcement of such right shall not be impaired or
affected without the written consent of the Holder.
SECTION 6.07 Collection Suit by Trustee.
If an Event of Default with respect to any Securities in payment of
interest or principal (and premium, if any) specified in Section 6.01(1) or (2)
occurs and is continuing, the Trustee may recover judgment in its own name and
as trustee of an express trust against the Company or any other obligor on the
Securities for the whole amount of unpaid principal (and premium, if any) and
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accrued interest remaining unpaid on the Securities, together with interest on
overdue principal (and premium, if any) and to the extent that payment of such
interest is lawful, interest on overdue installments of interest, in each case
at the rate borne by the Securities and 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.
SECTION 6.08 Trustee May File Proofs of Claim.
The Trustee may file such proofs of claim and 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 the
Holders of Securities allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Securities), its creditors or its
property and shall be entitled and empowered to collect and receive any monies
or other property payable or deliverable on any such claims and to distribute
the same. Any Custodian in any such judicial proceeding is hereby authorized
by each Securityholder 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 of Securities, to pay to the Trustee any amount due to it for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due the Trustee under Section
7.07.
Nothing herein contained shall be deemed to authorize the Trustee to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan or reorganization, arrangement, adjustment or composition affecting the
Securities or the rights of any Holder thereof, or to authorize the Trustee to
vote in respect of the claim of any Securityholder in any such proceedings.
SECTION 6.09 Priorities.
If the Trustee collects any money pursuant to this Article 6
with respect to the Securities, it shall pay out the money in the following
order:
FIRST: to the Trustee for payment of costs and expenses of
collection, including all sums paid or advanced by the Trustee
hereunder and the reasonable compensation, expenses and
disbursements of the Trustee, its agents and counsel and all
other amounts due under Section 7.07;
SECOND: to holders of any Senior Indebtedness as required by
Article 12; and
THIRD: to Holders of Securities for amounts due and unpaid
on the Securities for principal of (and premium, if any) and
interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Securities for
principal (and premium, if any) and interest, respectively;
and
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FOURTH: to the Company.
The Trustee may fix a record date and payment date for any payment to
Holders of Securities pursuant to this Section 6.09.
SECTION 6.10 Undertaking for Costs.
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, a court in its discretion may require the filing by any party
litigant in the suit of an undertaking to pay the costs of the suit, and the
court in its discretion may assess reasonable costs, including reasonable
attorney's fees, against any party litigant in the suit, having due regard to
the merits and good faith of the claims or defenses made by the party litigant.
This Section 6.10 does not apply to a suit by the Trustee, a suit by a Holder
pursuant to Section 6.06 or a suit by Holders of more than 25% in principal
amount of the Securities then Outstanding or a suit by any holder of Senior
Indebtedness.
SECTION 6.11 Limitations on Suits.
Subject to Section 6.06, a Holder of any Securities may not pursue any
remedy with respect to this Indenture or the Securities unless:
(1) the Holder has given the Trustee written notice of a continuing
Event of Default;
(2) the Holders of at least 25% in aggregate principal amount of the
Securities make a written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity
satisfactory to the Trustee against any loss, liability or expenses;
(4) The Trustee does not comply with the request within 60 days after
receipt of the notice, request and offer of indemnity; 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 aggregate principal amount of the Securities then
Outstanding.
A Holder of any Security may not use this Indenture to prejudice the
rights of another Securityholder or to obtain a preference or priority over
another Securityholder.
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ARTICLE 7
TRUSTEE
SECTION 7.01 Duties of Trustee.
(a) If an Event of Default has occurred and is
continuing, the Trustee shall exercise its rights and powers vested in it by
this Indenture and use the same degree of care and skill in their exercise as a
prudent person would exercise or use under the circumstances in the conduct of
his own affairs.
(b) Except during the continuance of an Event of Default
and after the curing or waiving of all such Events of Default which may have
occurred:
(1) The Trustee need perform only those duties that
are specifically set forth in this Indenture, and the
Trustee shall not be liable except for the
performance of such duties as are specifically set
forth in this Indenture, and no others, and no
implied covenants or obligation shall be read into
this Indenture against the Trustee.
(2) In the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the
statements and the correctness of the opinions
expressed therein, upon any statements certificates
or opinions furnished to the Trustee and conforming
to the requirements of this Indenture. The Trustee,
however, shall examine the certificates and opinions
to determine whether or not they conform to the
requirements of this Indenture.
(c) The Trustee may not be relieved from liability for its
own negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) This paragraph does not limit the effect of paragraph (b)
of this Section 7.01.
(2) The Trustee shall not be liable for any error in judgment
made in good faith by a Trust Officer, unless it is proved
that the Trustee was negligent in ascertaining the pertinent
facts.
(3) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to Section 6.05.
(4) No provision of this Indenture shall require the Trustee
to expend or risk its own funds or otherwise incur any
financial liability in the performance of any of its duties
hereunder or in the exercise of any of its rights or powers,
if it shall have reasonable
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grounds for believing that repayment of such funds or adequate
indemnity against such risk or liability is not reasonably
assured to it.
(d) Every provision of this Indenture that in any way relates
to the Trustee is subject to paragraphs (a), (b) and (c) of this Section 7.01
and subject to Sections 315 and 316 of the TIA.
(e) Subject to subsection (c), the Trustee may refuse to
perform any duty or exercise any right or power unless, subject to the
provisions of the TIA, it receives indemnity satisfactory to it against any
loss, liability, expense or fee.
(f) The Trustee shall not be liable for interest on any
money received by it except as the Trustee may agree in writing with the
Company. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law.
SECTION 7.02 Rights of Trustee.
(1) The Trustee may rely on and shall be protected in acting
or refraining from acting upon any document believed by it to be
genuine and to have been signed or presented by the proper Person.
The Trustee need not investigate any fact or matter stated in the
document.
(2) Before the Trustee acts or refrains from acting, it may
require an Officers' Certificate or an Opinion of Counsel, or both,
which shall conform to Section 13.05. The Trustee shall not be liable
for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel.
(3) The Trustee may act through agents or attorneys and shall
not be responsible for the misconduct or negligence of such agents or
attorneys appointed with due care and shall not be responsible for
their supervision.
(4) The Trustee shall not be liable for any action it takes
or omits to take in good faith which it believes to be authorized or
within its rights or powers.
(5) The Trustee may consult with counsel and the written
advice of such counsel or any Opinion of Counsel shall be full and
complete authorization and protection in respect of any action taken,
suffered or omitted by the Trustee hereunder in good faith and
reliance thereon.
(6) 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 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.
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SECTION 7.03 Individual Rights of Trustee.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or its
Affiliates with the same rights it would have if it were not Trustee. Any
Agent may do the same with like rights. The Trustee, however, is subject to
Sections 7.10 and 7.11.
SECTION 7.04 Trustee's Disclaimer.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the Company's
use of the proceeds from the Securities, and it shall not be responsible for
any statement of the Company in the Indenture or any statement in the
Securities other than its certificate of authentication or in any document used
in the sale of the Securities other than any statement in writing provided by
the Trustee expressly for use in such document.
SECTION 7.05 Notice of Defaults.
If a Default or Event of Default occurs and is continuing and if it is
actually known to the Trustee with respect to the Securities, the Trustee shall
mail to each Holder of Securities notice of the Default or Event of Default
within 90 days after it occurs. Except in the case of a default in payment of
principal of, premium, if any, or interest on any Security, the Trustee may
withhold the notice if and so long as a committee of its Trust Officers in good
faith determines that withholding the notice is in the interests of Holders of
Securities. Notwithstanding anything to the contrary expressed in this
Indenture, the Trustee shall not be deemed to have knowledge of any Event of
Default hereunder unless and until a Trust Officer shall have actual knowledge
thereof, or shall have received written notice thereof from the Company at its
principal Corporate Trust Office in Nashville, Tennessee. The Trustee shall
not be deemed to have actual knowledge of an Event of Default hereunder, except
in the case of an Event of Default under Sections 6.01(1) or 6.01(2) (provided
that the Trustee is the Paying Agent), until a Trust Officer receives written
notice thereof from the Company or any Securityholder that such an Event of
Default has occurred.
SECTION 7.06 Reports by Trustee to Holders.
Within 60 days after each May 15 beginning with May 15, 1996, the
Trustee, if required by the provisions of TIA Section 313(a), shall mail to
each Securityholder a brief report dated as of May 15 of such year that
complies with TIA Section 313(a). The Trustee also shall comply with TIA
Section 313(b), Section 313(c) and Section 313(d).
A copy of each report at the time of its mailing to Securityholders
shall be filed with the Commission and each stock exchange on which the
Securities are listed. The Company agrees to
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notify the Trustee in writing whenever the Securities become listed or delisted
on or from any stock exchange.
SECTION 7.07 Compensation and Indemnity.
The Company shall pay to the Trustee from time to time, and the
Trustee shall be entitled to, reasonable compensation for its services (which
compensation shall not be limited by any provision of law in regard to the
compensation of a trustee of an express trust). The Company shall reimburse
the Trustee upon request for all reasonable disbursements, expenses and
advances incurred or made by it. Such expenses may include, but shall not be
limited to, the reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel.
The Company shall indemnify the Trustee for, and hold it harmless
against, any loss or liability incurred by it in connection with the acceptance
or administration of this trust, including the costs and expenses of defending
itself against any claim or liability in connection with the Securities or the
exercise or performance of any of its powers or duties hereunder. The Trustee
shall notify the Company promptly of any claim asserted against the Trustee for
which it may seek indemnity and the Company may elect by written notice to the
Trustee to assume the defense of any such claim at the Company's expense with
counsel reasonably satisfactory to the Trustee; provided, however, that if the
Trustee is advised by counsel that the interests of the Company and the Trustee
conflict, the Trustee shall have the right to retain separate counsel.
The Company need not reimburse the Trustee for any expense or
indemnify it against any loss or liability incurred by it through the Trustee's
negligence or willful misconduct. The Company shall not be liable for any
settlement of any claim or action effected without the Company's consent, which
consent shall not be unreasonably withheld. To secure the Company's payment
obligations in this Section, the Trustee shall have a lien prior to the
Securities on all money or property held or collected by the Trustee.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01 occurs, the expenses and the compensation for
the services are intended to constitute expenses of administration under any
applicable bankruptcy or comparable law.
SECTION 7.08 Replacement of Trustee.
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's acceptance of
appointment as provided in this Section 7.08.
The Trustee may resign by so notifying the Company. The Holders of a
majority in principal amount of the Securities then Outstanding may remove the
Trustee by so notifying the Trustee and
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may appoint a successor Trustee with the Company's written consent. The
Company may remove the Trustee if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged a bankrupt or an insolvent;
(3) a receiver or other public officer takes charge of the
Trustee or its property; or
(4) the Trustee otherwise becomes incapable of acting with
respect to the Securities.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason, the Company shall promptly appoint a
successor Trustee.
If a successor Trustee does not take office within 45 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company or
the Holders of a majority in principal amount of the Securities then
Outstanding may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 7.10, any Securityholder
may petition any court of competent jurisdiction for the removal of the Trustee
and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Company. Immediately after
that, the retiring Trustee shall, upon payment of its fees and expenses,
transfer all property held by it as Trustee to the successor Trustee, subject
to the lien provided for in Section 7.07, the resignation or removal of the
retiring Trustee shall become effective, and the successor Trustee shall have
all the rights, powers and duties of the Trustee under this Indenture.
Notwithstanding the replacement of the Trustee pursuant to this Section 7.08,
the Company's obligations under Section 7.07 shall continue for the benefit of
the retiring Trustee with respect to expenses and liabilities incurred by it
and compensation earned by it prior to such replacement or otherwise. A
successor Trustee shall mail notice of its succession to each Holder of the
Securities.
SECTION 7.09 Successor Trustee by Merger, etc.
If the Trustee consolidates with, merges or converts into, or
transfers all or substantially all of its corporate trust assets to, another
corporation, the successor corporation without any further act shall be the
successor Trustee.
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SECTION 7.10 Eligibility; Disqualification.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA Section 310(a)(1). The Trustee shall have a combined
capital and surplus of at least $100,000,000 as set forth in its most recent
published annual report of condition. The Trustee shall comply with TIA
Section 310(b), including the optional provision permitted by the second
sentence of TIA Section 310(b)(9).
SECTION 7.11 Preferential Collection of Claims Against Company.
The Trustee is subject to TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated
therein.
ARTICLE 8
SATISFACTION AND DISCHARGE OF INDENTURE
SECTION 8.01 Satisfaction, Discharge and Defeasance of the Securities.
The Company shall be deemed to have paid and discharged the entire
indebtedness on the Securities after the date of the deposit referred to in
paragraph (a) below, the provisions of this Indenture shall no longer be in
effect in respect of the Securities, and the Trustee, at the expense of the
Company, shall execute proper instruments acknowledging satisfaction and
discharge of such indebtedness; provided that the following conditions shall
have been satisfied:
(a) the Company has deposited or caused to be deposited
with the Trustee irrevocably as trust funds in trust, specifically
pledged as security for, and dedicated solely to, the benefit of the
Holders of all Securities, with reference to this Section 8.01, (i)
money or (ii) U.S. Government Obligations or (iii) a combination
thereof, 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 the entire
indebtedness on all the Securities for principal, premium, if any, and
interest, if any, to the maturity date of such Securities as such
principal, premium, if any, or interest becomes due and payable in
accordance with the terms of this Indenture and the Securities;
(b) the Company has paid or caused to be paid all other
sums payable hereunder by the Company in connection with all of the
Securities, including all fees and expenses of the Trustee; and
(c) the Company has 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
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Service a ruling, or (ii) since the date 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 of Counsel shall
confirm that, the Holders shall not recognize income, gain or loss for
Federal income tax purposes as a result of such defeasance and shall
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;
(d) the Company has delivered to the Trustee an Opinion
of Counsel stating that the satisfaction, discharge and defeasance of
the Securities pursuant to this Section 8.01 will not cause the
Securities to be delisted from any national securities exchange on
which the Securities are then listed, if any.
(e) the Company has delivered to the Trustee an Officers'
Certificate stating that all conditions precedent herein provided for
relating to the satisfaction and discharge of the entire indebtedness
on the Securities and the discharge of this Indenture and the
termination of the Company's obligations hereunder have been complied
with.
"U.S. Government Obligations" means direct, non-callable obligations
of, or non-callable obligations guaranteed by, the United States of America for
the timely payment of which obligation or guarantee the full faith and credit
of the United States of America is pledged.
SECTION 8.02 Satisfaction and Discharge of Indenture.
In addition to its rights under Section 8.01, the Company may
terminate all of its obligations under this Indenture when:
(a) All of the Securities theretofore authenticated and
delivered (other than (A) Securities which have been destroyed, lost
or stolen and which have been replaced or paid as provided in Section
2.07 hereof and (B) Securities for whose payment money has theretofore
been deposited with the Trustee or the Paying Agent 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 2.05
and Section 8.06 hereof) have been delivered to the Trustee for
cancellation; and
(b) the Company has paid or caused to be paid all other sums
payable hereunder by the Company in connection with the Outstanding
Securities, including all fees and expenses of the Trustee.
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SECTION 8.03 Survival of Certain Obligations.
Notwithstanding the satisfaction and discharge of this Indenture
pursuant to Section 8.01, the respective obligations of the Company specified
in Sections 2.04, 2.05, 2.06, 2.07, 2.12, 7.07, 8.05, 8.06, 8.07 and in Article
10 shall survive until the Securities are no longer Outstanding, and after the
Securities are no longer Outstanding, or upon compliance with Section 8.02,
only the obligations of the Company in such Sections 7.07 and 8.06 shall
survive. Nothing contained in this Article Eight shall abrogate any of the
obligations or duties of the Trustee under this Indenture.
SECTION 8.04 Application of Trust Money.
(a) Subject to the provisions of Section 8.06, all money and U.S.
Government Obligations deposited with the Trustee for the Securities pursuant
to Section 8.01 or Section 8.02, and all money received by the Trustee in
respect of U.S. Government Obligations deposited with the Trustee for the
Securities pursuant to Section 8.01 or Section 8.02 shall be held in trust and
reinvested by the Trustee in U.S. Government Obligations in accordance with the
Company's written instructions and applied by the Trustee in accordance with
the provisions of the Securities 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, premium, if any, and interest, if any, on the Securities; but
such money need not be segregated from other funds except to the extent
required by law.
(b) The Trustee shall deliver or pay to the Company from time to time
upon the Company's written request any U.S. Government Obligations, or money
held by it as provided in Section 8.01 or Section 8.02 which, in the written
opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, are then
in excess of the amount thereof which then would have been required to be
deposited for the purpose for which such U.S. Government Obligations, or money
were deposited or received.
SECTION 8.05 Paying Agent to Repay Monies Held.
Upon the satisfaction and discharge of this Indenture with respect to
the Securities, all monies then held by any Paying Agent for the benefit of
Securities under the provisions of this Indenture shall, upon written demand of
the Company, be repaid to it or paid to the Trustee, and thereupon such Paying
Agent shall be released from all further liability with respect to such monies.
SECTION 8.06 Return of Unclaimed Monies.
Any monies deposited with or paid to the Trustee or any Paying Agent
for the Securities, or then held by the Company in trust, for the payment of
any principal, premium, if any, and interest, if any, on the Securities and not
applied but remaining unclaimed by the Holders of the Securities for two years
after the date upon which the principal of and interest, if any, on the
Securities, as the
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case may be, shall have become due and payable, shall, unless otherwise
required by mandatory provisions of applicable escheat or abandoned or
unclaimed property law, be repaid to the Company by such Trustee or any Paying
Agent on written demand by the Company or (if then held by the Company) shall
be discharged from such trust; and the Holders of the Securities entitled to
receive such payment shall thereafter look only to the Company for the payment
thereof; provided, however, that, before being required to make any such
repayment, such Trustee may, or shall at the written request of the Company, at
the expense of the Company, cause to be published once in an authorized
newspaper in the same city in which the place of payment with respect to the
Securities shall be located and in an financial newspaper of general
circulation in the City of New York, or mail to each such Holder, a notice (in
such form as may be deemed appropriate by such Trustee) that said monies remain
unclaimed and that, after a date named therein, any unclaimed balance of said
monies then remaining will be returned to the Company.
SECTION 8.07 Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or U.S.
Government Obligations with respect to the Securities in accordance with
Section 8.01 by reason of any legal proceeding or by reason of any order or
judgment of any court or governmental authority enjoining, restraining or
otherwise prohibiting such application, the Company's obligations under this
Indenture and the Securities shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.01 until such time as the Trustee or
Paying Agent is permitted to apply all such money or U.S. Government
Obligations in accordance with Section 8.04; provided, however, that if the
Company has made any payment of interest on or principal of any Securities
because of the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Securities to receive such
payment from the money or U.S. Government Obligations held by the Trustee or
Paying Agent.
ARTICLE 9
SUPPLEMENTAL INDENTURES
SECTION 9.01 Supplemental Indentures Without Consent of Holders.
The Company, when authorized by Board Resolution, and the Trustee at
any time and from time to time, may amend this Indenture or enter into one or
more indentures supplemental hereto, to be in a form satisfactory to the
Trustee without notice to or consent of any Securityholder for any of the
following purposes:
(1) to comply with Section 5.01; or
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(2) to provide for uncertificated Securities in addition to or in
place of certificated Securities; or
(3) to add to the covenants of the Company, for the benefit of the
Holders of the Securities, or to surrender any right or power herein conferred
upon the Company; or
(4) to add any Events of Default; and
(5) 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 any provision of this
Indenture, provided such other provisions shall not adversely affect the
interests of the Holders in any material respect.
(6) as contemplated by Section 10.10.
The Trustee shall be entitled to receive upon request an Opinion of
Counsel to its satisfaction with respect to any supplement to this Indenture
without consent of the Holders that all conditions precedent have been
satisfied.
SECTION 9.02 Supplemental Indentures with Consent of Holders.
With the written consent of the Holders of not less than a majority in
aggregate principal amount of the Securities at the time Outstanding affected
by such supplemental indenture, the Company, when authorized by Board
Resolution, and the Trustee may amend this Indenture or from time to time and
at any time enter into an indenture or indentures supplemental hereto (which
shall conform to the provisions of the Trust Indenture Act of 1939 as in force
at the date of the execution thereof) for the purpose of adding any provisions
to or changing in any manner or eliminating any of the provisions of this
Indenture or of any supplemental indenture, except as otherwise permitted by
Section 9.01, or of modifying in any manner the rights of the Holders. Subject
to Section 9.04, without the consent of each Holder of Securities affected,
however, an amendment, supplement or waiver, including a waiver pursuant to
Section 6.04, may not:
(1) extend the fixed maturity of any Securities, or reduce the
principal amount thereof or premium, if any, or reduce the rate or extend the
time of payment of interest thereon, without the consent of the Holder of each
Security so affected;
(2) reduce the aforesaid percentage of Securities, the consent of
the Holders of which is required for any such supplemental indenture, without
the consent of the Holders then Outstanding affected thereby;
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(3) waive (except, unless theretofore cured) a default in the
payment of the principal of (and premium, if any on), interest on or redemption
amounts with respect to any Security;
(4) make any Security payable in money other than that stated in
the Security;
(5) make any change in Sections 6.04, 6.06 or 9.02 (this sentence);
(6) make any change that adversely affects the right to convert
any Security; or
(7) make any change in Article 12 that adversely affects the
rights of any Securityholder.
Upon the request of the Company, accompanied by a copy of a Board
Resolution certified by the Secretary or an Assistant Secretary of the Company
authorizing the execution of any such supplemental indenture, and upon the
filing with the Trustee of evidence of the consent of Securityholders as
aforesaid, the Trustee shall join with the Company in the execution of such
supplemental indenture unless such supplemental indenture affects the Trustee's
own rights, duties or immunities under this Indenture or otherwise, in which
case the Trustee may in its discretion, but shall not be obligated to, enter
into such supplemental indenture.
It shall not be necessary for the consent of the Securityholders under
this Section to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent shall approve
the substance thereof.
Promptly after the execution by the Company and the Trustee of any
supplemental indenture pursuant to the provisions of this Section, the Company
shall mail a notice, setting forth in general terms the substance of such
supplemental indenture, to all Holders so affected as the names and addresses
of such Holders shall appear on the registry books. Any failure of the Company
so to mail such notice, or any defect therein, shall not, however, in any way
impair or affect the validity of any such supplemental indenture.
SECTION 9.03 Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Securities
shall comply with the TIA as then in effect.
SECTION 9.04 Revocation and Effect of Consents.
Subject to this Indenture, each amendment, supplement or waiver
evidencing other action shall become effective in accordance with its terms.
Until an amendment, supplement or waiver becomes effective, a consent to it by
a Holder of a Security is a continuing consent by the Holder even if notation
of the consent is not made on any Security. Any such Holder or subsequent
Holder,
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however, may revoke the consent as to his Security or portion of a Security, if
the Trustee receives the notice of revocation before the date the amendment,
waiver or other action becomes effective.
The Company may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then notwithstanding the
provisions of the immediately preceding paragraph, those Persons who were
Holders at such record date (or their duly designated proxies) and only those
Persons, shall be entitled to consent to such amendment, supplement or waiver
or to revoke any consent previously given, whether or not such Persons continue
to be Holders after such record date. No consent shall be valid or effective
for more than 90 days after such record date unless consent from Holders of the
principal amount of Securities then Outstanding required hereunder for such
amendment, supplement or waiver to be effective shall have also been given and
not revoked within such 90-day period.
After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder, unless it makes a change described in any of clauses
(1) through (6) of Section 9.02. In that case the amendment, supplement or
waiver shall only bind the Holders of a Security or portion of a Security.
SECTION 9.05 Notation on or Exchange of Securities.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may request the Holder of the Security to deliver it to the
Trustee. The Trustee may place an appropriate notation on the Security about
the changed terms and return it to the Holder. Alternatively, if the Company
or the Trustee so determine, the Company in exchange for the Security shall
issue and the Trustee shall authenticate a new Security that reflects the
changed terms the cost and expense of which will be borne by the Company.
SECTION 9.06 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 theretofore or thereafter authenticated and delivered hereunder shall be
bound thereby.
SECTION 9.07 Reference in Securities to Supplemental Indentures.
Securities 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 so modified as to conform, in the opinion of the
Trustee and the Board
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of Directors of 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.
ARTICLE 10
CONVERSION OF SECURITIES
SECTION 10.01 Right of Conversion; Conversion Price.
The Holder of any Security shall have the right, at his option, at any
time and from time to time (except that, with respect to any Security or
portion of a Security which shall be called for redemption, such right shall
terminate at the close of business on the date fixed for redemption of such
Security or portion of a Security unless the Company shall default in payment
due upon redemption thereof), to convert, subject to the terms and provisions
of this Article 10, the principal of any Security or Securities or any portion
thereof which is $1,000 principal amount or an integral multiple thereof into
such number of fully paid and non-assessable Units as is equal, subject to
Section 10.08, to the quotient of the principal of the Securities being so
converted divided by the Conversion Price (as defined below) then in effect,
upon surrender of the Security or Securities, the principal of which is so to
be converted, accompanied by written notice of conversion duly executed, to the
Company, at any time during usual business hours at the office or agency
maintained by it for such purpose, and, if so required by the Conversion Agent
or Registrar, accompanied by a written instrument or instruments of transfer in
form satisfactory to the Conversion Agent or Registrar duly executed by the
Holder or his duly authorized representative in writing. The "Conversion
Price" shall be $15.2063, subject to adjustment as set forth in Section 10.04.
For convenience, the conversion of any portion of the principal of any Security
or Securities into Units or other Securities is hereinafter sometimes referred
to as the conversion of such Security or Securities.
SECTION 10.02 Issuance of Units on Conversion.
As promptly as practicable after the surrender, as herein provided, of
any Security or Securities for conversion pursuant to Section 10.01, the
Company shall deliver or cause to be delivered at its said office or agency, to
or upon the written order of the Holder of the Security or Securities so
surrendered, certificates representing the number of fully paid and
nonassessable Units into which such Security or Securities may be converted in
accordance with the provisions of this Article 10. Such conversion shall be
deemed to have been made immediately prior to the close of business on the date
that such Security or Securities shall have been surrendered for conversion by
delivery thereof with a written notice of conversion duly executed, so that the
rights of the Holder of such Security or Securities as a Securityholder shall
cease at such time and, subject to the following provisions of this paragraph,
the Person or Persons entitled to receive the Units upon conversion of such
Security or Securities shall be treated for all purposes as having become the
record holder or holders of such Units at such time and such conversion shall
be at the Conversion
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Price in effect at such time; provided, however, that with respect to the
Company's Units no such surrender on any date when the stock transfer books of
the Company shall be closed (but not for any period in excess of five days)
shall be effective to constitute the Person or Persons entitled to receive the
Units upon such conversion as the record holder or holders of such Units on
such date, but such surrender shall be effective to constitute the Person or
Persons entitled to receive such Units as the record holder or holders thereof
for all purposes immediately prior to the close of business on the next
succeeding day on which such stock transfer books are open; such conversion
shall be deemed to have been made, and shall be made at the Conversion Price in
effect on the date that such Security or Securities shall have been surrendered
for conversion by delivery thereof, as if the stock transfer books of the
Company had not been closed. The Company shall give or cause to be given to
the Trustee written notice whenever the stock transfer books of the Company
shall be closed. If the last day for the exercise of the conversion right
shall not be a Business Day, then such conversion right may be exercised on the
next succeeding Business Day.
Upon Conversion of any Security which is converted in part only, the
Company shall execute and the Trustee shall authenticate and deliver to or on
the order of the Holder thereof, at the expense of the Company, a new Security
or Securities of authorized denominations in principal amount equal to the
unconverted portion of such Security.
SECTION 10.03 Payment of Interest.
When the Securities are converted, all interest accrued and unpaid
(whether or not currently payable) on the Securities to the date of conversion
shall be immediately due and payable, in cash or other immediately available
funds, and must accompany the Units issued upon such conversion.
SECTION 10.04 Adjustment of Conversion Price.
The Conversion Price shall be subject to adjustment as follows:
(1) In case the Company shall at any time or from time to
time (i) pay a dividend or make a distribution (other than a dividend or
distribution paid or made to the Holders of the Securities in the manner
provided in Section 4.03) on the outstanding Units in Units or other equity
interests (which, for purposes of this Section 10.04 shall include, without
limitation, any dividends or distributions in the form of options, warrants or
other rights to acquire Units or other equity interests) of the Company, (ii)
subdivide the outstanding Units into a larger number of Units, (iii) combine
the outstanding Units into a smaller number of Units, (iv) issue any equity
interest in a reclassification of the Units or (v) pay a dividend or make a
distribution on the outstanding Units in Units or other equity interests
pursuant to a rights plan, "poison pill" or similar arrangement, then, and in
each such case, the Conversion Price in effect immediately prior to such event
shall be adjusted (and any other appropriate actions shall be taken by the
Company) so that the holder of Securities thereafter surrendered for conversion
shall be entitled to receive the number of Units or other securities of the
Company that such holder would have owned or would have been entitled to
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receive upon or by reason of any of the events described above, had the
Securities been converted immediately prior to the occurrence of such event. An
adjustment made pursuant to this Section 10.04(1) shall become effective
retroactively (i) in the case of any such dividend or distribution, to a date
immediately following the close of business on the record date for the
determination of holders of Units entitled to receive such dividend or
distribution or (ii) in the case of any such subdivision, combination or
reclassification, to the close of business on the day upon which such corporate
action becomes effective.
(2) In case the Company shall at any time or from time to
time issue or sell Units (or securities convertible into or exchangeable for
Units, or any options, warrants or other rights to acquire Units) (other than
options to acquire Units granted pursuant to any stock option plan of the
Company at an exercise price per Unit equal to or greater than the fair market
value per Unit on the date of grant as determined pursuant to such stock option
plan and other than Units issued pursuant to the Company's Employee Unit
Purchase Plan), at a price per Unit less than the Current Market Price per Unit
then in effect at the record date referred to in the following sentence
(treating the price per share or unit of any security convertible or
exchangeable or exercisable into Units as equal to (i) the sum of the price for
such security convertible, exchangeable or exercisable into Units plus any
additional consideration payable (without regard to any anti-dilution
adjustments) upon the conversion, exchange or exercise of such security into
Units divided by (ii) the number of Units initially underlying such
convertible, exchangeable or exercisable security), then, and in each such
case, the Conversion Price then in effect shall be adjusted by dividing the
Conversion Price in effect on the day immediately prior to such record date by
a fraction (x) the numerator of which shall be the sum of the number of Units
outstanding on such record date plus the number of additional Units issued or
to be issued (or the maximum number into which such convertible or exchangeable
securities initially may convert or exchange or for which such options,
warrants or other rights initially may be exercised) and (y) the denominator of
which shall be the sum of the number of Units outstanding on such record date
plus the number of Units which the aggregate consideration for the total number
of such additional Units so issued (or into which such convertible or
exchangeable securities may convert or exchange or for which such options,
warrants or other rights may be exercised plus the aggregate amount of any
additional consideration initially payable upon conversion, exchange or
exercise of such security) would purchase at the Current Market Price per Unit
on such record date. Such adjustment shall be made whenever such Units,
securities, options, warrants or other rights are issued, and shall become
effective retroactively to a date immediately following the close of business
on the record date for the determination of holders of Units entitled to
receive such Units, securities, options, warrants or other rights; provided,
however, that the determination as to whether an adjustment is required to be
made pursuant to this Section 10.04(2) shall only be made upon the issuance of
such Units or such convertible or exchangeable securities, options, warrants or
other rights, and not upon the issuance of the security into which such
convertible or exchangeable security converts or exchanges, or the security
underlying such option, warrants or other right; provided, further, that if any
convertible or exchangeable securities, options, warrants or other rights (or
any portions thereof) which shall have given rise to an adjustment pursuant to
this Section 10.04(2) shall have expired or terminated without the exercise
thereof and/or
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if by reason of the terms of such convertible or exchangeable securities,
options, warrants or other rights there shall have been an increase or
increases, with the passage of time or otherwise, in the price payable upon the
exercise or conversion thereof, then the Conversion Price hereunder shall be
readjusted (but to no greater extent than originally adjusted with respect to
the related event) on the basis of (x) eliminating from the computation any
additional Units corresponding to such convertible or exchangeable securities,
options, warrants or other rights as shall have expired or terminated, (y)
treating the additional Units, if any, actually issued or issuable pursuant to
the previous exercise of such convertible or exchangeable securities, options,
warrants or other rights as having been issued for the consideration actually
received and receivable therefor and (z) treating any of such convertible or
exchangeable securities, options, warrants or other rights which remain
outstanding as being subject to exercise or conversion on the basis of such
exercise or conversion price as shall be in effect at the time.
(3) In case the Company shall at any time or from time to
time issue or sell Units or securities convertible into or exchangeable for
Units, or any options, warrants or other rights to acquire Units (other than
Units and options to acquire Units, in each case issued pursuant to any stock
option plan of the Company or the Company's Employee Unit Purchase Plan), at a
price per Unit less than the Conversion Price then in effect at the record date
referred to in the following sentence (treating the price per share or unit of
any security convertible or exchangeable or exercisable into Units as equal to
(A) the sum of the price for such security convertible, exchangeable or
exercisable into Units plus any additional consideration payable (without
regard to any anti-dilution adjustments) upon the conversion, exchange or
exercise of such security into Units divided by (B) the number of Units
initially underlying such convertible, exchangeable or exercisable security),
then, and in each such case, the Conversion Price then in effect shall be
adjusted, to the extent an adjustment is not made for any such issuance or sale
pursuant to Section 10.04(2), by dividing the Conversion Price in effect on the
day immediately prior to such record date by a fraction (x) the numerator of
which shall be the sum of the number of Units outstanding on such record date
plus the number of additional Units issued or to be issued (or the maximum
number into which such convertible or exchangeable securities initially may
convert or exchange or for which such options, warrants or other rights
initially may be exercised) and (y) the denominator of which shall be the sum
of the number of Units outstanding on such record date plus the number of Units
which the aggregate consideration for the total number of such additional Units
so issued (or into which such convertible or exchangeable securities may
convert or exchange or for which such options, warrants or other rights may be
exercised plus the aggregate amount of any additional consideration initially
payable upon conversion, exchange or exercise of such security) would purchase
at the Conversion Price on such record date. Such adjustment shall be made
whenever such Units, securities, options, warrants or other rights are issued,
and shall become effective retroactively to a date immediately following the
close of business on the record date for the determination of holders of Units
entitled to receive such Units, securities, options, warrants or other rights;
provided, however, that the determination as to whether an adjustment is
required to be made pursuant to this Section 10.04(3) shall be made upon the
issuance of such Units or such convertible or exchangeable securities, options,
warrants or other rights; provided, further, that if any convertible or
exchangeable
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securities, options, warrants or other rights (or any portion thereof) which
shall have given rise to an adjustment pursuant to this Section 10.04(3) shall
have expired or terminated without the exercise thereof and/or if by reason of
the terms of such convertible or exchangeable securities, options, warrants or
other rights there shall have been an increase or increases, with the passage
of time or otherwise, in the price payable upon the exercise or conversion
thereof, then the Conversion Price hereunder shall be readjusted (but to no
greater extent than originally adjusted with respect to the related event) on
the basis of (x) eliminating from the computation any additional Units
corresponding to such convertible or exchangeable securities, options, warrants
or other rights as shall have expired or terminated, (y) treating the
additional Units, if any, actually issued or issuable pursuant to the previous
exercise of such convertible or exchangeable securities, options, warrants or
other rights as having been issued for the consideration actually received and
receivable therefor and (z) treating any of such convertible or exchangeable
securities, options, warrants or other rights which remain outstanding as being
subject to exercise or conversion on the basis of such exercise or conversion
price as shall be in effect at this time.
(4) In case the Company shall at any time or from time to
time distribute on or with respect to the Units (including any such
distribution made in connection with a consolidation or merger in which the
Company is the resulting or surviving corporation and the Units are not changed
or exchanged) cash, evidences of indebtedness of the Company or another issuer,
securities of the Company or another issuer or other assets (excluding (i)
Regular Distributions (as defined in Section 10.04(7)), (ii) dividends and
distributions paid or made in the manner provided in Section 4.03 and, (iii)
dividends payable in Units for which adjustment is made under Section 10.04(1))
or rights or warrants to subscribe for or purchase securities of the Company
(excluding those referred to in Section 10.04(2) and 10.04(3)), then, and in
each such case, the Conversion Price then in effect shall be adjusted by
dividing the Conversion Price in effect immediately prior to the date of such
distribution by a fraction (x) the numerator of which shall be the Current
Market Price of the Units on the record date referred to below and (y) the
denominator of which shall be such Current Market Price of the Units less the
amount that a willing buyer would pay a willing seller in an arm's length
transaction at such time (as determined by the Board of Directors of the
Managing General Partner) for the portion of the cash, evidences of
indebtedness, securities or other assets so distributed or of such subscription
rights or warrants applicable to one Unit (but such denominator not to be less
than one); provided, however, that no adjustment shall be made with respect to
any distribution of rights to purchase securities of the Company if the holder
of the Securities would otherwise be entitled to receive such rights upon
conversion at any time of the Securities into Units unless such rights are
subsequently redeemed by the Company, in which case such redemption shall be
treated for purposes of this Section 10.04(4) as a distribution on the Units.
Such adjustment shall be made whenever any such distribution is made; provided,
however, that in the case of a Cash Distribution such adjustment shall be
calculated not later than 45 days following the last day of the Calculation
Period (as defined in Section 10.04(7) or the Relevant Period, as the case may
be. The adjustment shall become effective retroactively to a date immediately
following the close of business on the record date for the determination of
holders of Units entitled to receive such distribution.
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(5) In case the Company at any time or from time to time
shall take any action affecting the Units or its other equity interests, if
any, other than an action described in any of Section 10.04(1) through Section
10.04(5), inclusive, or Section 10.10, then, and in each such case, the
Conversion Price shall be adjusted in such manner and at such time as the Board
of Directors in good faith determines to be equitable in the circumstances
(such determination to be evidenced in a resolution, a certified copy of which
shall be mailed to the holders of the Securities).
(6) Notwithstanding anything herein to the contrary, no
adjustment under this Section 10.04 need be made to the Conversion Price (i)
unless such adjustment would require an increase or decrease of at least 1% of
the Conversion Price then in effect or (ii) for issuances of Units to any or
all of the Managing General Partner, National Healthcare Corporation, a
Tennessee corporation (the "Administrative General Partner") and Mr. W. Andrew
Adams ("Adams") solely for the purpose of maintaining their collective 1%
interest in the Company. Any lesser adjustment shall be carried forward and
shall be made at the time of and together with the next subsequent adjustment,
which, together with any adjustment or adjustments so carried forward, shall
amount to an increase or decrease of at least 1% of such Conversion Price. Any
adjustment to the Conversion Price carried forward and not theretofore made
shall be made immediately prior to the conversion of these Securities pursuant
hereto.
(7) For purposes of Section 10.04(4), a "Regular
Distribution" shall mean a Cash Distribution in an amount that, when added to
the amount of all other Cash Distributions made during the 12-month period
ending on the last day of the fiscal quarter of the Company in which such Cash
Distribution is made (the "Calculation Period"), does not exceed sixty percent
(60%) of the income of the Company during the Calculation Period that, if the
Calculation Period were a calendar year, would be subject, in the hands of the
holders of Units, to United States federal income tax applicable to the
Calculation Period.
(8) Notwithstanding anything herein to the contrary, if
the Company shall take a record of the holders of Units for the purpose of
entitling them to receive a dividend or other distribution, and shall
thereafter and before the distribution to holders thereof legally abandon its
plan to pay or deliver such dividend or distribution, then thereafter no
adjustment in the Conversion Price then in effect shall be required by reason
of the taking of such record.
SECTION 10.05 Notice of Adjustment of Conversion Price.
Whenever the conversion price for the Securities is adjusted as herein
provided:
(a) the Company shall compute the adjusted conversion price
in accordance with Section 10.04 and shall prepare an Officers'
Certificate setting forth the adjusted conversion price and showing
the facts upon which such adjustment is based and the computation
thereof, and such certificate shall forthwith be filed at each office
or agency maintained for the purpose of conversion of Securities
pursuant to Section 2.04 and with the Trustee; and
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(b) a notice stating that the conversion price has been
adjusted and setting forth the adjusted conversion price shall as soon
as practicable be mailed by the Company to all Holders at their last
addresses as they shall appear in the Security Register.
(c) If the conversion price is adjusted and the Company fails
to file an Officers' Certificate with the Trustee as provided by
Section 10.05(a) and the Trustee is acting as the Conversion Agent,
the Trustee shall be entitled to rely conclusively on the conversion
price set forth in the Officer's Certificate most recently received by
the Trustee (or as set forth in this Indenture if the conversion price
shall not have been adjusted).
SECTION 10.06 Notice of Certain Corporate Action.
(1) In case at any time or from time to time:
(a) the Company shall authorize the granting to holders
of Units or other equity interests, if any, of the Company of rights
or warrants entitling them to subscribe for or purchase any equity
interests of any class or of any other rights or warrants; or
(b) of any reclassification of the Units or other equity
interests, if any, of the Company, or of any consolidation or merger
to which the Company is a party and for which approval of any holders
of Units of the Company is required, or of the sale or transfer of all
or substantially all of the assets of the Company; or
(c) of the voluntary or involuntary dissolution,
liquidation or winding up of the Company; or
(d) the Company shall declare a dividend (or any other
distribution) on the Units or other equity interests, if any, of the
Company;
then the Company shall cause to be filed at each office or agency maintained
for the purpose of conversion of Securities pursuant to Section 2.04 and shall
cause to be mailed to all Holders of Securities that are convertible into the
Company's Units at their last addresses as they shall appear in the Security
Register, as promptly as possible, but in any event at least 10 days prior to
the applicable record date hereinafter specified, a notice stating (x) the date
on which a record is to be taken for the purpose of such dividend,
distribution, rights or warrants, or, if a record is not to be taken, the date
as of which the holders of Units of record to be entitled to such dividend,
distribution, rights or warrants are to be determined, or (y) the date on which
such reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up is expected to become effective, and the date as of
which it is expected that holders of Units of record shall be entitled to
exchange their Units for securities, cash or other property deliverable upon
such reclassification, consolidation, merger, sale, transfer, dissolution,
liquidation or winding up, provided that in the case of any event to which
Section 10.10 applies, the Company shall give at least 10 days prior notice as
aforesaid.
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Such notice shall also state whether such transaction will result in any
adjustment in the conversion price applicable to the Securities and, if so,
shall state what the adjusted conversion price will be and when it will become
effective. Neither the failure to give the notice required by this Section,
nor any defect therein, to any particular Holder shall affect the sufficiency
of the notice or the legality or validity of any such dividend, distribution,
right, warrant, reclassification, consolidation, merger, sale, transfer,
liquidation, dissolution or winding-up, or the vote on any action authorizing
such with respect to the other holders.
(2) In case the Company or any Affiliate of the Company shall propose
to engage in a "Rule 13e-3 Transaction" as defined in the Commission's Rule
13e-3 under the Exchange Act, the Company shall, no later than the date on
which any information with respect to such Rule 13e-3 Transaction is first
required to be given to the Commission or any other Person pursuant to such
Rule 13e-3, cause to be mailed to all Holders at their last addresses as they
shall appear in the Security Register, a copy of all information required to be
given to the holders of the Company's Capital Stock pursuant to such Rule
13e-3. The information required to be given under this paragraph shall be in
addition to and not in lieu of any other information required to be given by
the Company pursuant to this Section 10.06 or any other provision of the
Securities or this Indenture.
SECTION 10.07 Taxes on Conversions.
The issuance or delivery of certificates for Units upon the conversion
of Securities shall be made without charge to the converting Holder of
Securities for such certificates or for any tax in respect of the issuance or
delivery of such certificates or the securities represented thereby, and such
certificates shall be issued or delivered in the respective names of, or in
such names as may be directed by, the Holders of the Securities converted. The
Company shall not, however, be required to pay any tax which may be payable in
respect of any transfer involved in the issuance and delivery of Units in a
name other than that of the Holder of the Security or Securities to be
converted, and no such issuance or delivery shall be made unless and until the
Person requesting such issuance has paid to the Company the amount of any such
tax, or has established to the satisfaction of the Company that such tax has
been paid.
SECTION 10.08 Fractional Units.
No fractional Units or scrip representing fractional Units shall be
issued upon any conversion of Securities. If any such conversion would
otherwise require the issuance of a fractional Unit an amount equal to such
fraction multiplied by the Current Market Price per Unit on the Business Day
preceding the day of conversion shall be paid to the Holder in cash by the
Company.
SECTION 10.09 Cancellation of Converted Securities.
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All Securities delivered for conversion shall be delivered to the
Trustee or the Conversion Agent to be canceled by or at the direction of the
Trustee or the Conversion Agent, which shall dispose of the same as provided in
Section 2.10.
SECTION 10.10 Provisions in Case of Consolidation, Merger or Sale of Assets.
(1) In case of any capital reorganization or reclassification or
other change of outstanding Units or other equity interests, if any, or in case
of any consolidation or merger of the Company with or into another Person
(other than a consolidation or merger in which the Company is the resulting or
surviving Person and which does not result in any reclassification or change of
Units or other outstanding equity interests, if any), or in case of any sale or
other disposition to another Person of all or substantially all of the assets
of the Company (any of the foregoing, a "Transaction"), the Company, or such
successor or purchasing Person, as the case may be, shall execute and deliver
to the Trustee and to each Holder, at least 10 Business Days prior to effecting
any of the foregoing Transactions, a supplemental indenture providing that each
Holder of Securities shall have the right thereafter to convert such Securities
into the kind and amount (estimating such amount to the extent necessary) of
equity securities or other securities (of the Company or another issuer) or
property or cash receivable upon such Transaction by a holder of the number of
Units into which such Securities could have been converted immediately prior to
such Transaction. Such supplemental indenture shall provide for adjustments
which shall be as nearly equivalent as may be practicable to the adjustments
provided for in this Article 10. If, in the case of any such Transaction, the
equity securities, other securities, cash or property receivable thereupon by a
holder of Units includes equity or other securities of a Person other than the
successor or purchasing Person and other than the Company, which controls or is
controlled by the successor or purchasing Person or which, in connection with
such Transaction, issues equity securities, other securities, other property or
cash to holders of Units, then such supplemental indenture, also shall be
executed by such Person, and such Person shall, in such supplemental indenture,
specifically acknowledge the obligations of such successor or purchasing person
and acknowledge its obligations to issue such equity securities, other
securities, other property or cash to the Holders upon conversion of the
Securities as provided above. The provisions of this Section 10.10 and any
equivalent thereof in any such supplemental indenture similarly shall apply to
successive Transactions.
(2) The Trustee shall not be under any responsibility to determine
the correctness of any provisions contained in any such supplemental indenture
relating either to the kind or amount of shares of stock or securities or
property receivable by Holders upon the conversion of their Securities after
any such reclassification, change, consolidation, merger, sale or conveyance or
to any adjustment to be made with respect thereto.
SECTION 10.11 Disclaimer by Trustee of Responsibility for Certain Matters.
The Trustee shall not at any time be under any duty or responsibility
to any Holder of Securities to determine whether any facts exist which may
require any adjustment of the conversion
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price for such Securities, or with respect to the nature or extent of any such
adjustment when made, or with respect to the method employed, or herein or in
any supplemental indenture provided to be employed, in making the same. The
Trustee shall not be accountable with respect to the validity, value, kind or
amount of any Units, or of any securities or property, which may at any time be
issued or delivered upon the conversion of any Security; and it makes no
representation with respect thereto. The Trustee shall not be responsible for
any failure of the Company to issue, transfer or deliver any Units or stock
certificates or other securities or property upon the surrender of any Security
for the purpose of conversion or, subject to Section 7.01, to comply with any
of the covenants of the Company contained in this Article.
SECTION 10.12 Covenant to Reserve Units.
The Company covenants that it will at all times reserve and keep
available, free from preemptive rights, out of its authorized number of Units,
solely for the purpose of issuance upon conversion of Securities as herein
provided, such number of Units as shall then be issuable upon the conversion of
all Outstanding Securities. The Company covenants that all Units which shall
be so issuable shall be, when issued, duly and validly issued and fully paid
and non-assessable. For purposes of this Section 10.12, the number of Units
which shall be deliverable upon the conversion of all Outstanding Securities
shall be computed as if at the time of computation all Outstanding Securities
were held by a single holder. The Company shall take all action required to
increase the authorized number of Units if at any time there shall be
insufficient authorized but unissued Units to permit the reservation referred
to above or to permit the conversion of all the then outstanding principal
amount of the Securities.
ARTICLE 11
CHANGE IN CONTROL
SECTION 11.01 Change of Control Offer.
In the event of a Change of Control (as defined below) that occurs
prior to the date upon which the Debentures may be redeemed in accordance with
Section 3.01 hereof, the Company shall within 15 Business Days thereafter offer
to redeem from each Holder (a "Change of Control Offer"), and upon receipt by
the Company of written notice of acceptance of such Change of Control Offer by
a Holder the Company shall thereafter redeem all (but not less than all)
Outstanding Securities owned by such Holder pursuant to such Change of Control
Offer at a redemption price of 125% of the principal amount of the Securities
Outstanding on the redemption date, plus accrued and unpaid interest to the
redemption date, whether or not currently payable, on a date to be specified in
a "Notice of Offer" (as hereinafter provided) not sooner than 30 days and not
later than 60 days after the date of such notice (subject to compliance with
applicable securities laws). Notwithstanding the foregoing, in the event of a
Change of Control of the types set forth in clauses (iii), (iv) and (vi) below,
the Company shall make the Change of Control Offer not later than ten Business
Days prior
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to the consummation of the transaction contemplated by clause (iii), (iv) or
(vi) below, as the case may be, and the Company shall not be required to
purchase any Securities unless such transaction shall be consummated, in which
case the Company shall be required to purchase such Securities immediately
prior to the consummation of such transaction.
SECTION 11.02 Definition of Change of Control.
A "Change of Control" of the Company shall be deemed to have occurred:
(i) At such time as any Person or "group" (within
the meaning of Section 13(d)(3) of the Exchange Act) not
including Adams, the Administrative General Partner, the
Managing General Partner and each of the shareholders of the
Managing General Partner (collectively "Current Management")
is or becomes the beneficial owner, directly or indirectly, of
outstanding Units of the Company or of shares of capital stock
of the Managing General Partner, as the case may be, entitling
such Person or Persons to exercise 50% or more of the total
votes entitled to be cast at a regular or special meeting, or
by action by written consent, of the Unit holders of the
Company or of the shareholders of the Managing General
Partner, as the case may be (the term "beneficial owner" shall
be determined in accordance with Rule 13d-3, as in effect on
May 12, 1992, promulgated by the Commission under the Exchange
Act);
(ii) If a majority of the Board of Directors of
the Managing General Partner shall consist of Persons other
than Continuing Directors. The term "Continuing Director"
shall mean any member of the Board of Directors of the
Managing General Partner, on the Closing Date and any other
member of the Board of Directors who shall be recommended or
elected to succeed or become a Continuing Director by a
majority of Continuing Directors who are then members of the
Board of Directors of the Managing General Partner.
(iii) At such time as the Unit holders of the
Company or holders of shares of capital stock of the Managing
General Partner, as the case may be, shall have approved a
reorganization, merger or consolidation, in each case, with
respect to which all or substantially all the Persons who were
the respective beneficial owners of the outstanding Units of
the Company or, of the outstanding shares of capital stock of
the Managing General Partner, as the case may be, immediately
prior to such reorganization, merger or consolidation,
beneficially own, directly or indirectly, less than 50% of the
combined voting power of the then outstanding shares of
capital stock of the Company or the Managing General Partner,
as the case may be, resulting from such reorganization, merger
or consolidation;
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(iv) At the earlier of the approval by (A) the
Unit holders of the Company, (B) the holders of shares of
capital stock of the Managing General Partner or (C) the Board
of Directors of the Managing General Partner of the sale or
other disposition of all or substantially all the assets of
the Company or the Managing General Partner, as the case may
be, in one transaction or in a series of related transactions,
other than (1) a transaction or series of transactions
effected solely for the purpose of converting the form of the
Company to a corporation and in which Unit holders of the
Company prior to such conversion acquire, on a pro rata basis,
all of the capital stock of the Company following such
conversion or (2) a distribution of assets by the Company to
all of its Unit holders on a pro rata basis;
(v) If immediately after any merger,
consolidation, combination, reclassification or
recapitalization, Current Management (A) shall have increased
the aggregate percentage of the outstanding Units of the
Company represented by the Units they beneficially own,
directly or indirectly, by 20% of such outstanding Units or
more (or if the entity surviving such transaction is a
corporation, the Current Management's ownership in the new
entity shall have increased by 20% or more of the Current
Management's aggregate percentage of ownership of the Company
immediately prior to the transaction) and (B) shall be the
beneficial owners directly or indirectly, of outstanding Units
or shares of stock of the Company (or any Person surviving
such transaction) entitling the Current Management
collectively to exercise 50% or more of the total voting power
of all Units and other voting equity interests, if any, of the
Company (or the surviving Person in such transaction) and, in
anticipation of, in connection with or as a result of, such
transaction, the Company (or such surviving Person) shall have
incurred or issued additional Indebtedness such that the total
Indebtedness so incurred or issued equals at least 50% of the
consideration payable in such transaction; provided, however,
that any such transaction shall not be considered a Change of
Control if the Holders shall have participated therein on no
less than a pari passu basis (assuming conversion of all of
the Holders' Securities into Units) with Current Management
collectively;
(vi) At the earlier of the approval by (A) the
Unit holders of the Company or (B) the Board of Directors of
the Managing General Partner of any transaction the result of
which is that the Units shall no longer be required to be
registered under Section 12 of the Exchange Act and that the
holders of Units do not receive common stock of the Person
surviving such transaction which is required to be registered
under Section 12 of the Exchange Act.
(vii) If any Person other than Adams shall become
the Special General Partner (as defined in the Amended and
Restated Agreement of Limited Partnership of the Company),
other than solely by reason of the death, disability or
personal bankruptcy of Adams.
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SECTION 11.03 Notice of Offer.
The Change of Control Offer shall remain open from the time of mailing
until the redemption date set forth in the Notice of Offer. The Notice of
Offer shall be accompanied by a copy of the information most recently required
to be supplied under Section 4.02. The Notice of Offer shall contain all
instruments and material necessary to enable the Holders to tender the
Securities pursuant to the Change of Control Offer. The Notice of Offer, which
shall govern the terms of the Change of Control Offer, shall state:
(i) that the Change of Control Offer is being
made pursuant to Section 11.01 and that tendered Securities
will be redeemed;
(ii) the redemption price and the date for
redemption;
(iii) that the Change of Control Offer is being
made for all (but not less than all) Securities held by a
Holder;
(iv) that the Securities redeemed pursuant to the
Change of Control Offer shall cease to accrue interest after
the designated date for purchase (unless the Company shall
default in the payment of the redemption price pursuant to the
Change of Control Offer, in which case the Securities shall
not cease to accrue interest after such date);
(v) such other information respecting the
procedures for accepting the Change of Control Offer as the
Company shall include and such other information as may be
required by law; and
(vi) that (unless otherwise required by law) any
Holder will be entitled to withdraw his or her election if the
Company receives, not later than the close of business on the
third Business Day next preceding the date scheduled for
redemption, facsimile transmission or letter setting forth the
name of the Holder, the principal amount of Securities such
Holder delivered for redemption and a statement that such
Holder is withdrawing election to have such Securities
redeemed.
ARTICLE 12
SUBORDINATION; SENIORITY
SECTION 12.01 Securities Subordinated to Senior Indebtedness.
(1) The Company agrees, and each Holder of the Securities by his
acceptance thereof likewise agrees, that the payment of the principal of,
premium, if any, and interest on the Securities
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(all of the foregoing, a "Payment or Distribution") shall be subordinated and
subject in right of payment, to the extent and in the manner provided in this
Article 12, except as provided in Article 8, to the prior payment in full of
all Senior Indebtedness, whether outstanding on the date hereof or hereafter
incurred.
A Payment or Distribution shall include any asset of any kind or
character, and may consist of cash, securities or other property, by set-off or
otherwise, and shall include, without limitation, any purchase, redemption or
other acquisition of Securities or the making of any deposit of funds or
securities pursuant to this Indenture (including, without limitation, any
deposit pursuant to Article 8 hereof).
(2) The Senior Indebtedness of the Company shall continue to be
Senior Indebtedness and entitled to the benefit of these subordination
provisions irrespective of any amendment, modification or waiver of any term of
any instrument relating to refinancing of the Senior Indebtedness.
(3) All the provisions of this Indenture and the Securities shall be
subject to the provisions of this Article 12 so far as they may be applicable
thereto, except that nothing in this Article 12 shall apply to claims for, or
payments to, the Trustee under or pursuant to Section 7.07.
(4) No right of any holder of any Senior Indebtedness to enforce
subordination as herein provided shall at any time or in any way be affected or
impaired by any failure to act on the part of the Company, any Paying Agent,
the Holders of the Securities, the Trustee or the holders of the Senior
Indebtedness, or by any noncompliance by the Company, any Paying Agent, the
Holders of the Securities or the Trustee with any of the terms, provisions and
covenants of the Securities or this Indenture, regardless of any knowledge
thereof that any such holder of Senior Indebtedness may have or be otherwise
charged with.
(5) In the event that the Securities are declared due and payable
before their expressed maturity because of the occurrence of a default
hereunder, (i) the Company will give prompt notice in writing of such happening
to the holders of Senior Indebtedness and (ii) all Senior Indebtedness shall
forthwith become immediately due and payable upon demand, regardless of the
expressed maturity thereof.
SECTION 12.02 Company Not to Make Payments with Respect to Securities in
Certain Circumstances.
No payment shall be made by the Company of any subordinated amounts:
(a) in the event and during the continuation of any default in the payment (a
"Payment Default") of principal, premium, if any, interest or any other payment
due on any Senior Indebtedness under or in connection with the instrument,
agreement or lease evidencing such Senior Indebtedness and the holders of the
requisite principal amounts of such Senior Indebtedness or their agents shall
not have delivered to the Holders a notice of waiver of the benefits of this
clause (a) and a consent to the
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making of scheduled payments on or on account of the Securities or taking any
other prohibited action until further notice from such holders or such agents;
or (b) in the event of receipt of written notice by the Holders from the
holders of any Senior Institutional Indebtedness or their representatives of a
default (other than a Payment Default) permitting acceleration of any Senior
Institutional Indebtedness for a period (the "Blockage Period") terminating on
the earlier to occur of (i) the cure, waiver or cessation of such default or
(ii) 180 days from the date of receipt of written notice thereof by the
Holders. At the expiration of such Blockage Period, and so long as there does
not exist a Payment Default, the Company shall promptly pay to the Holders all
sums not paid during such Blockage Period as a result of this paragraph. For
all purposes of this paragraph, no event of default which existed or was
continuing with respect to the Senior Institutional Indebtedness to which the
Blockage Period relates on the date such Blockage Period commenced shall be or
be made the basis for the commencement of any subsequent Blockage Period by the
holder or holders of such Senior Institutional Indebtedness (or their
respective agents) unless such event of default is cured or waived for a period
of not less than 90 consecutive days. There shall be no more than one Blockage
Period initiated in any 360 day period.
Upon any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution or winding-up or liquidation or reorganization
of the Company, whether voluntary or involuntary or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due or to become due upon all
Senior Indebtedness shall first be paid in full, or payment thereof provided
for in money in accordance with its terms, before any payment (other than
equity securities or other securities of the Company or any other entity, the
payment of which is subordinated at least to the extent provided in this
Article 12 to the payment of all Senior Indebtedness that may at the time be
outstanding) is made on account of the principal, premium, if any, or interest
on, or other amounts payable in respect of, the Securities including, without
limitation, any amount payable in connection with the redemption of the
Securities; and upon any such dissolution, winding-up or liquidation or
reorganization any payment by the Company, or distribution of assets of the
Company of any kind or character, whether in cash, property or securities, to
which the Holders would be entitled, except for the provisions of this Article
12, shall be paid by the Company or by any receiver, trustee in bankruptcy,
liquidating trustee, agent or other person making such payment or distribution,
or by the Holders if received by them, directly to the holders of Senior
Indebtedness (pro rata to such holders on the basis of the respective amounts
of Senior Indebtedness held by such holders) or their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any Senior Indebtedness may have been issued,
as their respective interests may appear, to the extent necessary to pay all
Senior Indebtedness in full, in money or money's worth, after giving effect to
any concurrent payment or distribution to or for the holders of Senior
Indebtedness, before any payment or distribution is made to the Holders.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets of the Company of any kind or character, whether in
cash, property or securities, prohibited by the
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foregoing, shall be received by the Holders before all Senior Indebtedness is
paid in full, or provision is made for such payment in money in accordance with
its terms, such payment or distribution shall be held in trust for the benefit
of and shall be paid over or delivered to the holders of Senior Indebtedness or
their representative or representatives, or to the trustee or trustees under
any indenture pursuant to which any instrument evidencing any Senior
Indebtedness may have been issued, as their respective interests may appear,
for application to the payment of all Senior Indebtedness remaining unpaid to
the extent necessary to pay all Senior Indebtedness in full in money in
accordance with its terms, after giving effect to any concurrent payment or
distribution to or for the holders of such Senior Indebtedness.
The consolidation of the Company with, or the merger of the Company
into, another Person or the liquidation or dissolution of the Company following
the conveyance or transfer of its property as an entirety, or substantially as
an entirety, to another corporation upon the terms and conditions provided in
Article 5 shall not be deemed a dissolution, winding up, liquidation or
reorganization for the purposes of this Section 12.02 if such other Person
shall, as a part of such consolidation, merger, conveyance or transfer, comply
with the conditions stated in Article 5. Nothing in this Section shall apply
to claims of, or payments to, the Trustee under or pursuant to Section 7.07.
SECTION 12.03 Subrogation of Securities.
Subject to the payment in full in cash of all amounts then due
(whether by acceleration of the maturity thereof or otherwise) on account of
all Senior Indebtedness at the time outstanding, the rights of the Holders of
the Securities shall be subrogated to the rights of the holders of Senior
Indebtedness to receive payments or distributions of cash, property or
securities of the Company applicable to the Senior Indebtedness until the
principal of, premium, if any, and interest on the Securities shall be paid in
full; and, for the purposes of such subrogation, no payments or distributions
to the holders of Senior Indebtedness of any cash, property or securities to
which the Holders of the Securities or the Trustee would be entitled except for
the provisions of this Article 12, and no payments over pursuant to the
provisions of this Article 12 to the holders of Senior Indebtedness by Holders
of the Securities or the Trustee, shall, as between the Company, the Company's
creditors other than holders of Senior Indebtedness, and the Holders of the
Securities, be deemed to be a payment by the Company to or on account of the
Senior Indebtedness. It is understood that the provisions of this Article 12
are and are intended solely for the purpose of defining the relative rights of
the Holders of the Securities, on the one hand, and the holders of Senior
Indebtedness, on the other hand.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article 12 shall have been
applied, pursuant to the provisions of this Article 12 to the payment of
amounts payable under Senior Indebtedness of the Company, then, and in such
case, the Holders shall be entitled to receive from the holders of Senior
Indebtedness the full amount of any such payments or distributions received by
holders of Senior Indebtedness in excess of the
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amount sufficient to pay in full all amounts payable under or in respect of,
the Senior Indebtedness of the Company.
Nothing contained in this Article 12 or elsewhere in this Indenture or
in the Securities is intended to or shall impair, as among the Company, its
creditors other than the holders of Senior Indebtedness, and the Holders of the
Securities, the obligation of the Company, which is absolute and unconditional,
to pay to the Holders of the Securities the principal of, premium, if any, and
interest on the Securities as and when the same shall become due and payable in
accordance with their terms, or is intended to or shall affect the relative
rights of the Holders of the Securities and creditors of the Company other than
the holders of Senior Indebtedness, nor shall anything herein or therein
prevent the Trustee or the Holder of any Security from exercising all remedies
otherwise permitted by applicable law upon default under this Indenture or the
Securities, subject to the rights, if any, under this Article 12 of the holders
of Senior Indebtedness in respect of cash, property or securities of the
Company received upon the exercise of any such remedy.
Upon any payment or distribution of assets of the Company referred to
in this Article 12, the Trustee, subject to the provisions of Section 7.01, and
the Holders of the Securities shall be entitled to rely upon any order or
decree made by any court of competent jurisdiction in which any dissolution,
winding up, liquidation or reorganization proceedings are pending, or
certificate of the receiver, trustee in bankruptcy, liquidating trustee, agent
or other Person making such payment or distribution, delivered to the Trustee
or to the Holders of the Securities, for the purpose of ascertaining the
Persons entitled to participate in such distribution, the holders of Senior
Indebtedness and other indebtedness of the Company, the amount thereof or
payable thereon, the amount or amounts paid or distributed thereon and all
other facts pertinent thereto or to this Article 12.
SECTION 12.04 Authorization by Holders of Securities.
Each Holder of a Security by his acceptance thereof authorizes and
directs the Trustee on his behalf to take such action as may be necessary or
appropriate to effectuate, as between the Holder of the Security and the
holders of Senior Indebtedness, the subordination provided in this Article 12
and appoints the Trustee his attorney-in-fact for any and all such purposes
including, without limitation, to execute, verify, deliver and file any proofs
of claim which any holder of Senior Indebtedness may at any time require in
order to prove and realize upon any rights or claims pertaining to the
Securities and to effectuate the full benefit of the subordination contained
herein. Upon failure of the Trustee so to do, any such holder of Senior
Indebtedness shall be deemed to be irrevocably appointed the agent and
attorney-in-fact of the Holder to execute, verify, deliver and file any such
proofs of claim.
SECTION 12.05 Notices to Trustee.
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The Company shall give prompt written notice to the Trustee of any
fact known to it which would prohibit the making of any payment of moneys to or
by the Trustee in respect of the Securities. Notwithstanding the provisions of
this Article 12 or any other provision of this Indenture, the Trustee shall not
be charged with knowledge of the existence of any facts which would prohibit
the making of any payment of moneys to or by the Trustee in respect of the
Securities pursuant to the provisions of this Article 12 unless and until a
Trust Officer of the Trustee shall have received at its Corporate Trust Office
written notice thereof from the Company or a holder or holders of Senior
Indebtedness or from any trustee or agent therefor; and, prior to the receipt
of any such written notice, the Trustee, subject to the provisions of Section
7.01, shall be entitled in all respects to assume that no such facts exist;
provided, however, that if a Trust Officer of the Trustee shall not have
received at least three Business Days prior to the date upon which by the terms
hereof any such moneys may become payable for any purpose (including, without
limitation, the payment of the principal of, premium, if any, or interest on
any Security) with respect to such moneys the notice provided for in this
Section 12.05, then, anything herein contained to the contrary notwithstanding,
the Trustee shall have the full power and authority to receive such moneys and
to apply the same to the purpose for which they were received and shall not be
affected by any notice to the contrary which may be received by it within three
Business Days prior to such date.
The Trustee shall be entitled to rely conclusively on the delivery to
it of a written notice by a Person representing himself to be a holder of
Senior Indebtedness (or a trustee on behalf of such holder) to establish that
such notice has been given by a holder of Senior Indebtedness or a trustee or
agent on behalf of any such holder. In the event that the Trustee determines
in good faith that further evidence is required with respect to the right of
any Person as a holder of Senior Indebtedness to participate in any payment or
distribution pursuant to this Article 12, the Trustee may request such Person
to furnish evidence to the reasonable satisfaction of the Trustee as to the
amount of Senior Indebtedness held by such Person, the extent to which such
Person is entitled to participate in such payment or distribution and any other
facts pertinent to the rights of such Person under this Article 12, and if such
evidence is not furnished, the Trustee may defer any payment to such Person
pending judicial determination as to the right of such Person to receive such
payment.
SECTION 12.06 Trustee's Relation to Senior Indebtedness.
The Trustee in its individual capacity shall be entitled to all the
rights set forth in this Article 12 in respect of any Senior Indebtedness at
any time held by it, to the same extent as any other holder of Senior
Indebtedness, and nothing in Section 7.11 or elsewhere in this Indenture shall
deprive the Trustee of any of its rights as such holder.
With respect to the holders of Senior Indebtedness, the Trustee
undertakes to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Article 12, and no implied covenants or
obligations with respect to the holders of Senior Indebtedness shall be read
into this Indenture against the Trustee. The Trustee shall not owe any
fiduciary duty to the holders of Senior Indebtedness and shall not be liable to
any such holder if it shall mistakenly pay over or
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distribute to Holders of the Securities or the Company or any other Person
money or assets to which any holder of Senior Indebtedness shall be entitled by
virtue of this Article 12 or otherwise.
SECTION 12.07 No Impairment of Subordination.
No right of any present or future holder of any Senior Indebtedness to
enforce subordination as herein provided shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of the Company,
the Trustee or the Holder of any of the Securities or by any act, or failure to
act, in good faith, by any such holder of Senior Indebtedness, or by any
noncompliance by the Company, the Trustee or the Holder of any of the
Securities with the terms, provisions and covenants of this Indenture,
regardless of any knowledge thereof which any such holder may have or otherwise
be charged with.
SECTION 12.08 Article 12 Not To Prevent Events of Default.
The failure to make a payment on account of principal of, premium, if
any, or interest on the Securities by reason of any provision in this Article
12 shall not be construed as preventing the occurrence of an Event of Default
with respect to such Securities under Section 6.01.
SECTION 12.09 Paying Agents other than the Trustee.
In any case at any time any Paying Agent other than the Trustee shall
have been appointed by the Company and be then acting hereunder, the term
"Trustee" as used in this Article 12 shall in such case (unless the context
shall otherwise require) be construed as extending to and including such Paying
Agent within its meaning as fully for all intents and purposes as if such
Paying Agent were named in this Article 12 in addition to or in place of the
Trustee.
SECTION 12.10 Securities Senior to Subordinated Indebtedness.
The indebtedness represented by the Securities will be senior and
prior in right of payment to all subordinated indebtedness, to the extent and
in the manner provided in such subordinated indebtedness.
SECTION 12.11 Holder's Relation to Senior Indebtedness.
The Holders shall be entitled to all the rights set forth in this
Article 12 in respect of any Senior Indebtedness at any time held by them, to
the extent as any other holder of Senior Indebtedness, and nothing in this
Indenture shall deprive the Holders of any of their rights as such Holder.
With respect to the holders of Senior Indebtedness, the Holders
undertake to perform or to observe only such of its covenants and obligations
as are specifically set forth in this Indenture, and
60
<PAGE> 66
no implied covenants or obligations with respect to the holders of Senior
Indebtedness shall be read into this Indenture against the Holders. The
Holders shall not be deemed to owe any fiduciary duty to the holders of Senior
Indebtedness and the Holders shall not be liable to any holder of Senior
Indebtedness if they shall mistakenly pay over or deliver to the Company or any
other Person money or assets to which any holder of Senior Indebtedness shall
be entitled by virtue of this Article 12 or otherwise.
ARTICLE 13
MISCELLANEOUS
SECTION 13.01 Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by the
TIA, the required provisions shall control. The provisions of TIA Sections 310
through 317 that impose duties on any Person (including the provisions
automatically deemed included herein unless expressly excluded by this
Indenture) are a part of and govern this Indenture, whether or not physically
contained herein.
SECTION 13.02 Notices.
Any notices or other communications required or permitted hereunder
shall be in writing, and shall be sufficiently given if made by hand delivery,
or first class mail, postage prepaid (except that any notice by the Trustee to
the Company of a default or an Event of Default under this Indenture shall be
by registered or certified mail, postage prepaid, return receipt requested), or
by a nationally-recognized overnight express courier service (which notices or
communications shall be deemed received the business day after the receipt
thereof by such service), addressed as follows:
if to the Company:
National HealthCare L.P.
100 Vine Street
Suite 1400
City Center
Murfreesboro, TN 37130
if to the Trustee:
First American National Bank
400 First American Center
Nashville, Tennessee 37237
61
<PAGE> 67
The Company or the Trustee by notice to the other may designate additional or
different addresses as shall be furnished in writing by either party. Any
notice or communication to the Company or the Trustee shall be deemed to have
been given or made as of the date so delivered if personally delivered, and
five (5) calendar days after mailing if sent by registered or certified mail
(except that a notice of change of address shall not be deemed to have been
given until actually received by the addressee).
Any notice or communication mailed to a Securityholder shall be mailed
to the address of such Securityholder as it appears on the registration books
of the Registrar and shall be sufficiently given if so mailed within the time
prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
In case by reason of the suspension of regular mail service, or by
reason of any other cause, it shall be impossible to mail any notice, as
required by this Indenture, then such method of notification as shall be made
with the approval of the Trustee shall constitute a sufficient mailing of such
notice.
If the Company mails any notice or communication to Securityholders,
it shall mail a copy to the Trustee and all Agents at the same time.
SECTION 13.03 Communications by Holders with Other Holders.
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Company, the Trustee, the Registrar and anyone else shall have
the protection of TIA Section 312(c).
SECTION 13.04 Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(1) an Officers' Certificate (which shall include the statements set
forth in Section 13.05) stating that, in the opinion of the signers, all
conditions precedent, if any, provided for in this Indenture relating to the
proposed action have been complied with; and
(2) an Opinion of Counsel (which shall include the statements set
forth in Section 13.05) stating that, in the opinion of such counsel, all such
conditions precedent have been complied with.
62
<PAGE> 68
SECTION 13.05 Statements Required in Certificate and Opinion.
Each Certificate and Opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate or opinion
has read such covenant or condition;
(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 such Person, he has made such
examination or investigation as is necessary to enable him to express
an informed opinion as to whether or not such covenant or condition
has been complied with; and
(4) a statement as to whether or not, in the opinion of such Person,
such covenant or condition has been complied with.
SECTION 13.06 Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Registrar, Paying Agent or Conversion Agent may make
reasonable rules for its functions.
SECTION 13.07 Record Date.
Whenever the Company or the Trustee solicits an act of
Securityholders, the Company or the Trustee may fix in advance of the
solicitation of such act a date as the record date for determining
Securityholders entitled to perform said act. The record date shall be not
more than 15 days prior to the date fixed for the solicitation of said act.
SECTION 13.08 Legal Holidays.
A "Legal Holiday" is a Saturday, a Sunday or a day on which banks or
trust companies in the city in which either the Trustee or the Company is
located are not required to be open. If a payment date is a Legal Holiday at a
place of payment, payment may be made at that place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the intervening
period.
SECTION 13.09 Governing Law.
THE LAWS OF THE STATE OF NEW YORK SHALL GOVERN THIS INDENTURE AND THE
SECURITIES WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
63
<PAGE> 69
SECTION 13.10 No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company or a Subsidiary. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
SECTION 13.11 No Recourse Against Others.
No shareholder, director or officer, as such, past, present or future,
of the Company or of any successor corporation or trust shall have any
liability for any obligation of the Company under the Securities or the
Indenture or for any claim based on, in respect of or by reason of, such
obligations or their creation. Each Holder of a Security by accepting a
Security waives and releases all such liability. The waiver and release are
part of the consideration for the issuance of the Securities.
SECTION 13.12 Successors.
All agreements of the Company in this Indenture and the Securities
shall bind its successor. All agreements of the Trustee in this Indenture
shall bind its successor.
SECTION 13.13 Multiple Counterparts.
The parties may sign multiple counterparts of this Indenture. Each
signed counterpart shall be deemed an original, but all of them together
represent the same agreement.
SECTION 13.14 Table of Contents, Headings, etc.
The table of contents, cross-reference sheet and headings of the
Articles and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof, and shall in no way
modify or restrict any of the terms or provisions hereof.
SECTION 13.15 Severability.
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby,
and a Holder shall have no claim therefor against any party hereto.
64
<PAGE> 70
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed, all as of the date first written above.
NATIONAL HEALTHCARE L.P.
By:
--------------------------------
Name:
Title:
FIRST AMERICAN NATIONAL BANK,
as Trustee
By:
--------------------------------
Authorized Officer
65
<PAGE> 1
EXHIBIT 4.3
[FORM OF FACE OF DEBENTURE]
NATIONAL HEALTHCARE L.P.
6.0% Convertible Subordinated Debenture
due July 1, 2000
NATIONAL HEALTHCARE L.P., a limited partnership duly organized and
existing under the laws of the State of Delaware (herein called the "Company",
which term includes any successor, partnership or partnerships, or corporation
or corporations under the Indenture hereinafter referred to), for value
received, hereby promises to pay to _______________, or its registered assigns,
the principal sum of ____________ Dollars on July 1, 2000 at the office or
agency of the Company maintained for that purpose, in such coin or currency of
the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts, and to pay interest, quarterly on
the last business day of March, June, September and December ("Interest Payment
Date") of each year, on said principal sum at said office or agency, in like
coin or currency, at a rate of 6.0% per annum. Interest shall accrue from and
including the most recent date to which interest has been paid to but excluding
the date of payment. Interest shall be computed on the basis of a 360-day year
consisting of twelve 30-day months. The Company shall pay interest on overdue
principal and on overdue interest (to the full extent permitted by law) at a
rate equal to 8.0% per annum. The interest so payable on any Interest Payment
Date shall be paid to the person in whose name this Debenture (or one or more
Predecessor Debentures (as defined in the Indenture) is registered at the close
of business on the record date, which shall be the fifteenth day (whether or
not a business day) of the month in which such Interest Payment Date occurs
even if this Debenture is converted or cancelled after the record date and on
or before the interest payment date; provided, however, that any such interest
not punctually paid or duly provided for shall be payable as provided in the
Indenture. Interest may, at the option of the Company, be paid by check mailed
to the registered address of such person.
Reference is made to the further provisions of this Debenture set
forth in the reverse hereof, including without limitation, provisions
subordinating the payment of principal, premium, if any, and interest on the
Debentures to the prior payment in full of all Senior Indebtedness (as defined
in the Indenture) and provisions giving the Holder (as defined in the
Indenture) the right to convert this Debenture into limited partnership units
("Units") of the Company on the terms and subject to the limitations referred
to on the reverse hereof and as more fully specified in the Indenture. Such
further provisions shall for all purposes have the same effect as though fully
set forth at this place.
This Debenture shall be deemed to be a contract made under the laws of
the State of New York and for all purposes shall be construed in accordance
with and governed by the laws of said State, without regard to principles and
conflicts of laws thereof.
<PAGE> 2
This Debenture shall not be valid or become obligatory for any purpose
until the certificate of authentication hereon shall have been manually signed
by the Trustee under the Indenture.
IN WITNESS WHEREOF, NATIONAL HEALTHCARE L.P. has caused this
Instrument to be duly executed.
NATIONAL HEALTHCARE L.P.
Dated: By:
------------------- --------------------------------
Attest:
- ----------------------------------
Secretary
<PAGE> 3
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Debentures described in the within-mentioned Indenture.
FIRST AMERICAN NATIONAL BANK
as Trustee
By:
----------------------------------
By Authorized Signatory
<PAGE> 4
[FORM OF REVERSE OF DEBENTURE]
NATIONAL HEALTHCARE L.P.
6.0% Convertible Subordinated Debenture
due July 1, 2000
This Debenture is one of a duly authorized issue of Debentures of the
Company, designated as its 6.0% Convertible Subordinated Debentures due July 1,
2000 (herein called the "Debentures"), limited to the aggregate principal
amount of $30,000,000, all issued or to be issued under and pursuant to an
Indenture dated as of August ___ , 1995 (herein called the "Indenture"),
between the Company and First American National Bank, as Trustee (herein called
the "Trustee"), to which Indenture and all indentures supplemental thereto
reference is hereby made for a description of the rights, limitation of rights,
obligations, duties and immunities thereunder of the Trustee, the Company and
the Holders. Each Holder, whether upon original issue or upon transfer or
assignment hereof, accepts and agrees to be bound by the provisions in the
Indenture.
In case an Event of Default (as defined in the Indenture) shall have
occurred and be continuing, the principal of and all unpaid and accrued
interest on all Debentures may be declared, and upon such declaration shall
become, due and payable, in the manner, with the effect and subject to the
conditions provided in the Indenture.
The Indenture contains provisions permitting the Company and the
Trustee, with the consent of the Holders of not less than a majority in
aggregate principal amount of the Debentures at the time outstanding, evidenced
as in the Indenture provided, to execute supplemental indentures adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or of any supplemental indenture or modifying in any manner the
rights of the Holders; provided, however, that no such supplemental indenture
shall (i) extend the fixed maturity of any Debenture, or reduce the rate or
extend the time of payment of interest thereon, or reduce the principal amount
thereof or any premium thereon, (ii) make the principal thereof or any premium
or interest thereon payable in any coin or currency other than that
hereinbefore provided, (iii) impair the rights of any Holder to institute suit
for the payment thereof, (iv) impair the right to convert the Debentures into
Units of the Company subject to the terms set forth in the Indenture, (v)
change the subordination provisions in a way that adversely affects a Holder,
without the consent of each Holder so affected (vi) reduce the aforesaid
percentage of Debentures, the Holders of which are required to consent to any
such supplemental indenture, or (vii) waive (unless theretofore cured) a
default in the payment of the principal of (premium, if any) interest on or
redemption amounts with respect to any Debenture, without the consent of the
Holders of all Debentures then outstanding. It is also provided in the
Indenture that the Holders of a majority in aggregate principal amount of the
Debentures at the time outstanding may on behalf of the Holders of all of the
Debentures waive any past default or Event of Default under the Indenture and
its consequences except a default in the payment of interest or any premium on
or the principal of any of the Debentures or a failure by the Company
<PAGE> 5
to convert any Debentures into Units of the Company when required to do so by
the terms of the Indenture. Any such consent or waiver by the Holder of this
Debenture (unless revoked as provided in the Indenture) shall be conclusive and
binding upon such Holder and upon all future holders and owners of this
Debenture and any Debentures which may be issued in exchange or substitution
herefor, irrespective of whether any notation thereof is made upon this
Debenture or such other Debentures.
The indebtedness evidenced by the Debentures is, to the extent and in
the manner provided in the Indenture, expressly subordinate and subject in
right of payment to the prior payment in full of all Senior Indebtedness of the
Company (as defined in the Indenture), whether outstanding at the date of the
Indenture or thereafter incurred, and this Debenture is issued subject to the
provisions of the Indenture with respect to such subordination. Each Holder of
this Debenture, by accepting the same, agrees, expressly for the benefit of the
present and future holders of Senior Indebtedness, to and shall be bound by
such provisions and authorizes the Trustee on his behalf to take such action as
may be necessary or appropriate to effectuate the subordination so provided and
appoints the Trustee his attorney in fact for such purpose.
No reference herein to the Indenture and no provision of this
Debenture or of the Indenture shall alter or impair the obligation of the
Company, which is absolute and unconditional, to pay the principal of and any
premium and interest on this Debenture at the place, at the respective times,
at the rate and in the coin and currency herein prescribed.
The Debentures are issuable in registered form without coupons in
denominations of $1,000.00 and any integral multiple of $1,000.00. At the
office or agency of the Company, and in the manner and subject to the
limitations provided in the Indenture, but without payment of any service
charge, Debentures may be exchanged for a like aggregate principal amount of
Debentures of other authorized denominations.
The Company will redeem the Debenture at the option of the Holders at
a redemption price of 125% of the principal amount plus accrued and unpaid
interest, if a Change of Control (as defined in the Indenture) occurs. The
Company's offer to redeem due to the occurrence of a Change of Control shall
remain open from the time of mailing until the redemption date set forth in the
notice of offer, which must be accompanied by certain financial statements and
officer's certificates as provided in the Indenture.
Except as otherwise provided in the Indenture, the Company shall not
have any right to prepay or redeem the Debentures. On and after January 1,
1998 or, if the Company shall have elected to be taxable as a corporation and
as of the Redemption Date (as defined below) the Current Market Price of the
aggregate number of Units into which the Debentures to be redeemed shall be
convertible as of the Redemption Date shall equal or exceed the Recovery Amount
(as defined below), on or after May 12, 1996, the Company shall have the right,
at any time and from time to time at its sole option and election, to redeem
the Debentures, in whole or in part in
<PAGE> 6
integral multiples of $10,000,000 by outstanding principal amount, on not less
than 30 days notice of the date of redemption, which must be a business day
(any such date an "Redemption Date") at a price (the "Redemption Price") equal
to (i) the outstanding principal amount of the Debentures to be redeemed plus
(ii) an amount equal to all accrued and unpaid interest thereon, whether or not
currently payable, to the applicable Redemption Date, in cash or other
immediately available funds. For purposes hereof, "Recovery Amount" shall mean
the amount by which (i) the amount that results from compounding the principal
amount of the Debentures to be redeemed at a rate of 25 percent per annum for
the date of issuance of the Debentures to the Redemption Date exceeds (ii) the
amount that results from compounding all amounts of interest paid, including
Additional Interest, and other redistributions made with respect to the
principal amount of the Debentures to be redeemed on or prior to the Redemption
Date at a rate of 25 percent per annum from, in the case of each such payment
of interest or other distribution, the date such payment or other distribution
is made to the Redemption Date.
If there is a redemption of less than the entire outstanding principal
amount of all outstanding Debentures, each outstanding Debenture shall be
redeemed in part in the manner required by the principal Securities Exchange on
which the Debentures are then listed for trading or if the Debentures are not
so listed or no manner of selection is required, pro rata to all other
outstanding Debentures on the basis of outstanding principal amount of such
Debentures.
Notice of any redemption of the Debentures shall be mailed at least
30, but not more than 60, days prior to the date fixed for redemption to each
Holder of the Debentures to be redeemed, at such Holder's address as it appears
on the transfer books of the Company.
On the date of any redemption being made pursuant to this optional
redemption which is specified in a notice given as described above, the Company
shall, and at any time after such notice shall have been mailed and before the
date of redemption the Company may, deposit for the benefit of the Holders of
the Debentures to be redeemed the funds necessary for such redemption with the
Paying Agent.
Notice of redemption having been given as aforesaid, notwithstanding
that any such Debentures themselves shall not have been surrendered for
cancellation, from and after the date of redemption designated in the notice of
redemption (i) that portion of the principal amount of the Debentures that is
to be redeemed shall no longer be deemed outstanding, (ii) the rights to
receive interest thereon shall cease to accrue and (iii) all rights of the
Holders to be redeemed shall cease and terminate with respect to that portion
of the principal amount of the Debentures that is to be redeemed, excepting
only the right to receive the Redemption Price therefor and the right to
convert such Debentures into Units until the close of business on the date of
redemption.
<PAGE> 7
Provided, however, that if the Company shall default in the payment of the
Redemption Price, that portion of the principal amount of the Debentures that
was to be redeemed shall thereafter be deemed to be Outstanding and the Holders
thereof shall have all of the rights of a Holder of Debentures until such time
as such default shall no longer be continuing or shall have been waived by
Holders of at least 66-2/3% of the then outstanding principal amount of all
Debentures.
The Holders shall have the right, at their option, at any time and
from time to time, to convert any or all of the then outstanding principal
amount of the Debentures into such number of fully paid and non-assessable
Units as is equal to the quotient of the principal of the Debentures being so
converted divided by the Conversion Price (as defined below) then in effect,
except that with respect to any portion of the Debentures which shall be called
for redemption, such right shall terminate at the close of business on the date
of redemption for such portion of the Debentures, unless in any such case the
Company shall default in performance or payment due upon redemption thereof.
The "Conversion Price" shall be $15.2063, subject to adjustment as provided in
the Indenture.
Such conversion right shall be exercised by the surrender of this
Debenture to the Company at any time during usual business hours at its
principal place of business to be maintained by it, accompanied by written
notice that the Holder elects to convert the Debenture (or a specified portion
of the outstanding principal amount thereof) and specifying the name or names
(with address) in which a certificate or certificates for Units are to be
issued and (if so required by the Company) by a written instrument or
instruments of transfer in form reasonably satisfactory to the Company duly
executed by the Holder or its duly authorized legal representative and transfer
tax stamps or funds therefor, if required. If less than all of the then
outstanding principal amount of the Holder's Debentures are to be converted,
the Company will promptly issue and deliver to the holder a new Debenture in
the principal amount of the unconverted portion of the Debenture submitted for
conversion.
The Company, the Trustee, any paying agent, any conversion agent and
Debenture registrar may deem and treat the registered Holder hereof as the
absolute owner of this Debenture (whether or not this Debenture shall be
overdue and notwithstanding any notation of ownership or other writing hereon
made by anyone other than the Company or any Debenture registrar), for the
purpose of receiving payment hereof, or on account hereof for the conversion
hereof and for all other purposes, and neither the Company nor the Trustee nor
any paying agent nor any conversion agent nor any Debenture registrar shall be
affected by any notice to the contrary. All payments made to or upon the order
of such registered Holder shall, to the extent of the sum or sums paid, satisfy
and discharge liability for moneys payable on this Debenture.
No recourse for the payment of the principal of or any premium or
interest on this Debenture, or for any claim based hereon or otherwise in
respect hereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture or any indenture supplemental thereto
or in any Debenture, or because of the creation of any indebtedness represented
thereby, shall
<PAGE> 8
be had against any incorporator, stockholder, officer or director, as such,
past, present or future, of the Company (other than as provided in the
Indenture) of any successor corporation, of the Trustee or any successor
corporation, or any successor to the Trustee whether by virtue of any
constitution, statute or rule of law or by the enforcement of any assessment or
penalty or otherwise, all such liability being, by the acceptance hereof and as
a part of the consideration for the issue hereof, expressly waived and released.
<PAGE> 9
[FORM OF CONVERSION NOTICE]
To: National HealthCare L.P.
The undersigned registered owner of this Debenture (the "Registered
Holder") hereby irrevocably exercises the option to convert this Debenture, or
portion hereof (which is $________ or an integral multiple thereof) below
designated, into shares of common stock, par value $.01 per share (the "Common
Stock"), of National HealthCare L.P., in accordance with the terms of the
Indenture referred to in this Debenture, and directs that the shares issuable
and deliverable upon conversion, together with any check in payment for
fractional shares and any Debentures representing any unconverted principal
amount hereof, be issued and delivered to the Registered Holder unless a
different name has been indicated below. If shares are to be issued in the name
of a person other than the Registered Holder, the Registered Holder will pay
all transfer taxes payable with respect thereto. Any amount required to be paid
by the Registered Holder on account of interest accompanies this Debenture.
Dated: ------------------------------------
Signature(s)
Fill in for registration of shares if to be delivered, and Debentures
if to be issued, other than to and in the name of the Registered Holder:
------------------------------------
Social Security or Other Taxpayer
Identification Number
- ----------------------------------
(Name)
- ----------------------------------
(Street Address)
- ----------------------------------
(City, State and Zip Code)
(*Please print name and address)
Principal amount to be converted (if
less than all):
--------------------------------------
<PAGE> 10
[FORM OF ASSIGNMENT]
For value received _______________________________ hereby sell(s), assign(s)
and transfer(s) unto __________________________________________________________
_______________________________________________________________________________
(Please insert name, address and taxpayer identification or other identifying
number of assignee)
the within Debenture and hereby irrevocably constitutes and appoints
________________ attorney to transfer the said Debenture on the books of the
Company, with full power of substitution in the premises .
Dated Dated
- ----------------------- -------------------------
Signature(s) must be guaranteed by
an eligible guarantor institution
which is a participant in a
Securities Transfer Association
recognized program.
- -----------------------
Signature Guarantee
<PAGE> 1
EXHIBIT 5
HARWELL HOWARD HYNE
GABBERT & MANNER, P.C.
1800 FIRST AMERICAN CENTER
315 DEADERICK STREET
NASHVILLE, TENNESSEE 37238
--------------------
TELEPHONE (615) 256-0500
FACSIMILE (615) 251-1059
August 29, 1995
National HealthCare L.P.
100 Vine Street
Suite 1402
Murfreesboro, Tennessee 37130
Re: $30,000,000 6% Senior Subordinated Convertible Debentures
Registered Pursuant to Rule 415 By Registration Statement on Form S-3
Gentlemen:
This opinion is delivered in our capacity as special counsel to
National HealthCare L.P. (the "Company") in connection with the issuance and
sale by a Selling Securityholder of up to an aggregate amount of $30,000,000 6%
Senior Subordinated Convertible Debentures ("Offered Securities"). The Offered
Securities are the subject of the Company's registration statement on Form S-3
(the "Registration Statement") being filed with the Securities and Exchange
Commission (the "Commission") under the Securities Act of 1933, as amended (the
"Act") and are proposed by the Selling Securityholder to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Act, with a
Prospectus Supplement meeting the requirements of the Act or the rules
thereunder describing each offering of Offered Securities ("Applicable
Prospectus Supplement") to be filed with the Commission in connection with such
offering.
As special counsel for the Company, we have examined the Registration
Statement, the Limited Partnership Agreement of the Company, as amended to
date, resolutions of the Company's Managing General Partner's Board of
Directors, the form of the proposed Indenture ("Indenture") relating to the
Offered Securities, and such other records, certificates and documents of the
Company as we have deemed appropriate for the purpose of this opinion.
In stating our opinion, we have assumed: (i) that all signatures are
genuine, all documents submitted to us as originals are authentic, and all
documents submitted to us as copies conform to authentic original documents;
and (ii) that the parties to such documents have the legal right and power
under all applicable laws, regulations and agreements to enter into, execute,
deliver and perform their respective obligations thereunder.
<PAGE> 2
National HealthCare L.P.
August 29, 1995
Page 2
On the basis of such review, subject to the limitations expressed
herein, we are of the opinion that:
1. The Offered Securities that are the subject of the
Registration Statement which have been issued to the Selling
Securityholder were legally issued and are fully paid and
nonassessable, binding obligations of the Company.
2. The limited partnership units of the Company into
which the Offered Securities may be converted, will, when converted
in accordance with the terms of the Indenture, be legally issued,
fully paid and nonassessable.
In rendering the opinion set forth herein, we have relied upon the
documents referenced above and such other information as we have deemed
necessary, but we have made no independent verification or investigation of
factual matters pertaining thereto or to the Company. The opinion expressed
herein is subject to applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance and other similar laws now or thereafter in
effect relating to or affecting the rights or creditors generally, judicial
discretion, and equitable principles whether applied pursuant to a proceeding
at law or in equity; and no opinion is expressed with respect to the
availability of equitable remedies.
We hereby consent to being named as counsel to the Company in the
Registration Statement, to the reference therein to our firm, and to the
inclusion of this opinion as an exhibit to the Registration Statement.
Sincerely,
HARWELL HOWARD HYNE
GABBERT & MANNER, P.C.
----------------------
Harwell Howard Hyne
Gabbert & Manner, P.C.
<PAGE> 1
EXHIBIT 12
National HealthCare L.P.,
Calculation of Earnings to Fixed Changes Ratio
For 1818 Fund Registration
<TABLE>
<CAPTION>
Six Months
-----------------------
1990 1991 1992 1993 1994 1994 1995
<S> <C> <C> <C> <C> <C> <C> <C>
Earnings:
Net income: 18,955,990 17,666,538 9,501,224 37,562,871 15,852,676 6,673,294 8,758,000
Fixed Changes: 10,691,553 14,162,065 13,091,307 12,668,652 14,251,421 6,130,966 8,617,413
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total Earnings 29,647,543 31,828,603 22,592,531 50,231,523 30,104,097 12,804,260 17,375,413
========== ========== ========== ========== ========== ========== ==========
Fixed Charges
Interest expense: 10,245,112 13,060,304 12,612,829 11,629,477 13,049,718 5,633,361 8,304,261
Interest capitalization: 247,000 907,000 253,000 810,636 766,056 305,000 75,000
Amortization of debt: 199,441 194,761 225,478 228,539 435,647 192,605 238,152
---------- ---------- ---------- ---------- ---------- ---------- ----------
Total fixed charges: 10,691,553 14,162,065 13,091,307 12,668,652 14,251,421 6,130,966 8,617,413
========== ========== ========== ========== ========== ========== ==========
Ratio 2.77 2.25 1.73 3.97 2.11 2.09 2.02
</TABLE>
<PAGE> 1
EXHIBIT 23(a)
ARTHUR ANDERSEN LLP
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation by
reference in the National HealthCare L.P.'s S-3 Registration Statement dated
August 30, 1995 of our reports dated February 1, 1995 included and incorporated
by reference in the Partnership's Form 10-K for the year ended December 31,
1994 and to all references to our Firm included in this Registration
Statement.
Arthur Andersen LLP
-------------------
Arthur Andersen LLP
Nashville, Tennessee
August 28, 1995
<PAGE> 1
EXHIBIT 25
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------------
FORM T-1
STATEMENT OF ELIGIBILITY UNDER THE
TRUST INDENTURE ACT OF 1939
OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A
TRUSTEE PURSUANT TO SECTION 305(B)(2)......[ ]
FIRST AMERICAN NATIONAL BANK
(Exact name of trustee as specified in its charter)
NOT APPLICABLE 62-0854774
(Jurisdiction of incorporation (I.R.S. Employer
or organization Identification Number)
if not a U.S. national bank)
400 FIRST AMERICAN CENTER
NASHVILLE, TENNESSEE 37203-0403
(Address of principal executive offices) (Zip code)
NOT APPLICABLE
(Name, address and telephone number of Agent for service)
-----------------------
NATIONAL HEALTHCARE L.P.
(Exact name of obligor as specified in its charter)
DELAWARE 62-1293855
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
100 VINE STREET
SUITE 1400
MURFREESBORO, TENNESSEE 37130
(Address of principal executive offices) (Zip code)
-----------------------
NATIONAL HEALTHCARE L.P.
$30,000,000 6.0% SENIOR SUBORDINATED CONVERTIBLE DEBENTURES,
DUE 2000
(Title of the indenture securities)
<PAGE> 2
GENERAL
ITEM 1. GENERAL INFORMATION.
FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE --
(a) NAME AND ADDRESS OF EACH EXAMINING OR SUPERVISING AUTHORITY TO
WHICH IT IS SUBJECT.
Office of the Comptroller of the Currency
Marquis One Tower, Suite 600
245 Peachtree Center Avenue, N.E.
Atlanta, Georgia 30303
(b) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
The trustee is authorized by its Articles of Association to
exercise Corporate Trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
Obligor is not an affiliate of the trustee.
ITEM 3. VOTING SECURITIES OF THE TRUSTEE.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 4. TRUSTEESHIPS UNDER OTHER INDENTURES.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH THE OBLIGOR
OR UNDERWRITERS.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS
OFFICIALS.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
2
<PAGE> 3
ITEM 7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR
OFFICIALS.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 9. SECURITIES OF UNDERWRITERS OWNED OR HELD BY THE TRUSTEE.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN
AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON
OWNING 50 PERCENT OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 12. INDEBTEDNESS OF THE OBLIGOR OF THE TRUSTEE.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 13. DEFAULTS BY THE OBLIGOR.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 14. AFFILIATIONS WITH THE UNDERWRITERS.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
ITEM 15. FOREIGN TRUSTEE.
No response required pursuant to paragraph B. of General
Instructions to Form T-1.
3
<PAGE> 4
ITEM 16. LIST OF EXHIBITS.
LIST BELOW ALL EXHIBITS FILED AS PART OF THIS STATEMENT OF
ELIGIBILITY.
EXHIBIT 1. A COPY OF ARTICLES OF ASSOCIATION OF THE TRUSTEE AS
NOW IN EFFECT.
EXHIBIT 2. A COPY OF THE CERTIFICATE OF AUTHORITY OF THE TRUSTEE
TO COMMENCE BUSINESS, IF NOT CONTAINED IN THE
ARTICLES OF ASSOCIATION.
Not Applicable.
EXHIBIT 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.
Not Applicable.
EXHIBIT 4. A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE, OR
INSTRUMENTS CORRESPONDING THERETO.
EXHIBIT 5. A COPY OF EACH INDENTURE REFERRED TO IN ITEM 4, IF
THE OBLIGOR IS IN DEFAULT.
Not applicable.
EXHIBIT 6. THE CONSENTS OF UNITED STATES INSTITUTIONAL TRUSTEES
REQUIRED BY SECTION 321(b) OF THE ACT.
EXHIBIT 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.
EXHIBIT 8. A COPY OF ANY ORDER PURSUANT TO WHICH THE FOREIGN
TRUSTEE IS AUTHORIZED TO ACT AS SOLE TRUSTEE UNDER
INDENTURES QUALIFIED OR TO BE QUALIFIED UNDER THE
ACT.
Not applicable.
4
<PAGE> 5
EXHIBIT 9. FOREIGN TRUSTEES ARE REQUIRED TO FILE A CONSENT TO
SERVICE OF PROCESS ON FORM F-X.
Not applicable.
NOTE
In answering any item in this statement of eligibility that relates to matters
peculiarly within the knowledge of the obligor or underwriters, the Trustee has
relied upon the information furnished to it by the obligor and underwriters and
the Trustee disclaims responsibility for the accuracy or competence of such
information.
SIGNATURE
PURSUANT TO THE REQUIREMENTS OF THE TRUST INDENTURE ACT OF 1939, THE TRUSTEE,
FIRST AMERICAN NATIONAL BANK, A NATIONAL BANKING ASSOCIATION ORGANIZED AND
EXISTING UNDER THE LAWS OF THE UNITED STATES OF AMERICA, HAS DULY CAUSED THIS
STATEMENT OF ELIGIBILITY TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED,
THEREUNTO DULY AUTHORIZED, ALL IN THE CITY OF NASHVILLE AND STATE OF TENNESSEE,
ON THE 25TH DAY OF AUGUST, 1995.
FIRST AMERICAN NATIONAL BANK
By: /s/ Brenda Landers
------------------------
Brenda Landers
Vice President
5
<PAGE> 6
EXHIBIT 1
A COPY OF ARTICLES OF ASSOCIATION
OF THE TRUSTEE AS NOW IN EFFECT
<PAGE> 7
ARTICLES OF ASSOCIATION OF
FIRST AMERICAN NATIONAL BANK
NASHVILLE, TENNESSEE
(AS AMENDED DECEMBER 16, 1993)
First. The title of this Association shall be "First American
National Bank."
Second. The main office shall be in Nashville, Davidson County,
Tennessee. The general business of the Association shall be conducted at its
main office and its legally established branches.
Third. The Board of Directors of this Association shall consist of
not less than five nor more than twenty-five members. At any meeting of the
shareholders held for the purpose of electing Directors, or changing the number
thereof, the number of Directors may be determined by a majority of the votes
cast by the shareholders in person or by proxy. A majority of the Board of
Directors shall be necessary to constitute a quorum for the transaction of
business at any Directors' meeting. The Board of Directors by the vote of a
majority of the full Board may between annual meetings of shareholders increase
the membership of the Board and by like vote appoint qualified persons to fill
vacancies whenever and however created.
Fourth. The regular annual meeting of the shareholders of this
Association shall be held at its main banking house, or other convenient place
duly authorized by the Board of Directors, on such day of each year as
specified therefor in the By-Laws, at which meeting a Board of Directors shall
be elected; but, if no such election shall be held on that day, it may be held
at any regular adjournment thereof or at a subsequent special meeting called
in accordance with the provisions of the laws of the United States.
Fifth. The amount of capital stock of this Association shall be
Seventy-five Million Dollars ($75,000,000) divided into 7,500,000 shares of
common stock of the par value of Ten Dollars ($10.00) each; but said capital
stock may be increased or decreased from time to time, in accordance with the
provisions of the laws of the United States.
If the capital stock is increased by the sale of additional shares
thereof, each shareholder shall be entitled to subscribe for such additional
shares in proportion to the number of shares of said capital stock owned by him
at the time the increase is authorized by the shareholders, unless another time
subsequent to the date of the shareholders' meeting is specified in a
resolution adopted by the shareholders at the time the increase is authorized.
The Board of Directors shall have the power to prescribe a reasonable period of
time within which the preemptive rights to subscribe to the new shares of
capital stock must be exercised. If the capital stock is increased by a stock
dividend, each shareholder shall be entitled to his proportionate amount of
such
<PAGE> 8
ARTICLES OF ASSOCIATION OF
FIRST AMERICAN NATIONAL BANK
NASHVILLE, TENNESSEE
(AS AMENDED DECEMBER 16, 1993)
increase in accordance with the number of shares of capital stock owned by him
at the time the increase is authorized by the shareholders, unless another time
subsequent to the date of the shareholders' meeting is specified in a
resolution adopted by the shareholders at the time the increase is authorized.
Sixth. The Board of Directors shall appoint one of its members
President of this Association. The Board of Directors shall have the power to
appoint one or more Vice Presidents, a Cashier and such other officers and
employees as may be required to transact the business of this Association; to
fix the salaries to be paid to such officers and employees of this Association,
and to dismiss any of such officers or employees and appoint others to take
their place.
The Board of Directors shall have the power to define the duties of
officers and employees of this Association and to require adequate bonds from
them for the faithful performance of their duties; to make all By-Laws that may
be lawful for the general regulation of the business of this Association and
the management of its affairs, and generally to do and perform all acts that
may be lawful for a Board of Directors to do and perform.
The Board of Directors shall have the power to change the location of
the main office of this Association to any other place subject to the
affirmative vote of the holders of 2/3 of the issued and outstanding capital
stock of the Association, and the approval of the Comptroller of the Currency,
if required; and shall also have the power to establish, discontinue, or change
the location of any branch or branches of this Association to any other
location, without the approval of the shareholders of this Association, but
subject to the approval of the Office of the Comptroller of the Currency, if
required.
Seventh. The corporate existence of this Association shall continue
until terminated in accordance with the laws of the United States.
Eighth. The Board of Directors of this Association, or any
shareholder(s) owning, in the aggregate, not less than twenty five per centum
(25%) of the stock of this Association, may call a special meeting of
shareholders at any time.
Unless otherwise provided by the laws of the United States, or
specifically waived, a notice of the time, place, and purpose of every regular,
annual, and every special meeting
-2-
<PAGE> 9
ARTICLES OF ASSOCIATION OF
FIRST AMERICAN NATIONAL BANK
NASHVILLE, TENNESSEE
(AS AMENDED DECEMBER 16, 1993)
of the shareholders shall be given by first class mail, postage prepaid, mailed
at least ten days prior to the date of such meeting to each shareholder of
record at his address as shown upon the books of this Association, provided
however, that the Board of Directors shall have the power to prescribe a
shorter notice period, and the manner in which said notice will be given in the
case of a special meeting.
Subject to the provisions of the laws of the United States, these
Articles of Association may be amended at any meeting of the shareholders for
which adequate notice has been given, by the affirmative vote of the owners of
a majority of the stock of this Association, voting in person or by proxy.
Ninth. Any director, officer, employee or their heirs, executors, or
administrators may be indemnified or reimbursed by the Association for
reasonable expenses actually incurred in connection with actions to which the
directors, officers or employees are parties or potential parties by reason of
the performance of their official duties to the fullest extent permissible
under the laws of the United States from time to time in effect.
Notwithstanding the foregoing or any provision contained herein to the
contrary, the Association shall not indemnify any officer, director or employee
against expenses, penalties or other payments incurred in an administrative
proceeding or action instituted by an appropriate bank regulatory agency which
proceeding or action results in a final order assessing civil money penalties
or requiring affirmative action by an individual or individuals in the form of
payments to the Association to the extent expressly prohibited under 12 C.F.R.
Part 7, Section 7.5217 or otherwise under the laws of the United States.
The Association may, upon affirmative vote of a majority of its board
of directors, purchase insurance to indemnify its directors, officers, and
other employees to the extent that such indemnification is allowed in these
Articles of Association, exclusive of insurance coverage for a formal order
assessing civil money penalties against a director or employee in his or her
capacity as such to the extent that the purchase of such coverage is expressly
prohibited under 12 C.F.R. Part 7, Section 7.5217 or otherwise under the laws
of the United States. Such insurance may, but need not, be for the benefit of
all directors, officers, or employees.
-3-
<PAGE> 10
EXHIBIT 4
A COPY OF THE EXISTING BY-LAWS OF THE TRUSTEE,
OR INSTRUMENTS CORRESPONDING THERETO
<PAGE> 11
CERTIFICATE
The undersigned Assistant Secretary of First American National Bank,
headquartered in Nashville, Tennessee ("First American") hereby certifies that
the attached is a true and correct copy of First American's By-Laws duly
adopted by the Directors of First American at a meeting held on the 16th day of
March, 1995, that such meeting was duly called and held in conformity with
first American's Articles of Association and By-Laws, and at such meeting, a
quorum was present and acting throughout, and that said By-Laws have not been
modified, changed or rescinded, but are now in full force and effect.
This 22nd day of August, 1995.
/s/ Pamela B. Welch
--------------------------
ASSISTANT SECRETARY
FIRST AMERICAN NATIONAL BANK
[SEAL]
<PAGE> 12
BY-LAWS
OF
FIRST AMERICAN NATIONAL BANK
NASHVILLE, TENNESSEE
(HEREIN SOMETIMES THE "BANK")
EFFECTIVE MARCH 16, 1995
ARTICLE I
MEETINGS OF SHAREHOLDERS
SECTION 1.1. ANNUAL MEETING. The regular meeting of the shareholders
for the election of directors and the transaction of whatever other business
may properly come before the meeting, shall be held at a designated office of
the Bank in Nashville, Tennessee, at 1:00 p.m., on the fourth Thursday in April
of each year, or at such other date, time and place as the Board of Directors
(hereinafter sometimes referred to as the "Board") may designate.
SECTION 1.2. SPECIAL MEETINGS. Except as otherwise specifically
provided by statute, special meetings of the shareholders may be called for any
purpose at any time by the Board or by the holders of not less than twenty-five
percent of the stock of the Bank entitled to vote at such meeting.
SECTION 1.3. NOTICE OF MEETINGS. Notice of the time, place and
purpose of every annual or special meeting of shareholders, unless waived,
shall be mailed postage prepaid, at least ten days prior to the date set for
the meeting, addressed to each shareholder of record at the close of business
on the record date established for such meeting, at his address appearing on
the records of the Bank; provided however, that if in the discretion of the
Board, a shorter notice period is advisable in the case of a special meeting,
at least twenty-four hours notice shall be given, and may be given by
telephone, telegraph or in person.
SECTION 1.4. MANNER OF ACTING. The act of the majority of the
shareholders shall, unless otherwise provided by law, be the act of the Bank.
Any action required or permitted to be taken at a meeting of shareholders, may
be taken without a meeting, if a consent in writing, setting forth the action
so taken, shall be signed by all of the shareholders of record on the date the
consent is signed. Such written consent shall have the same force and effect as
a unanimous vote.
<PAGE> 13
SECTION 1.5. NOMINATIONS FOR DIRECTOR. Nominations for election to
the Board may be made by the Board or by any shareholder of any outstanding
class of capital stock of the Bank entitled to vote for the election of
directors. Nominations, other than those made by or on behalf of the existing
management of the Bank, shall be made in writing and shall be delivered or
mailed to the President of the Bank and to the Comptroller of the Currency,
Washington, D.C. not less than 10 days nor more than 20 days prior to any
meeting of shareholders held for the election of directors. Written notice of
a nomination shall contain the following information to the extent known to the
notifying shareholder: (a) the name and address of each proposed nominee; (b)
the principal occupation of each proposed nominee; (c) the total number of
shares of capital stock of the Bank that will be voted for each proposed
nominee; (d) the name and residence address of the notifying shareholder; and
(e) the number of shares of capital stock of the Bank owned by the notifying
shareholder. Nominations not made in accordance herewith may, in his
discretion, be disregarded by the Chairman of the meeting and, upon his
instructions, the vote tellers may disregard all votes cast for each such
nominee. In the event the same person is nominated by more than one
shareholder, the nomination shall be honored and all shares shall be counted if
at least one nomination for that person complies with the provisions of this
paragraph.
SECTION 1.6. VOTING. Each shareholder shall be entitled to cast one
vote for each share of stock registered in his name on the records of the Bank,
on the record date established for the meeting. Except as otherwise provided
by law or by the Articles of Association, all matters shall be determined by a
majority of the votes cast.
SECTION 1.7. PROXIES. Shareholders may vote at any meeting of the
shareholders by proxies duly authorized in writing, but no officer or employee
of the Bank shall act as proxy. Proxies shall be valid only for one meeting, to
be specified therein, and any adjournments of such meeting. Proxies may be
obtained in advance of a meeting, shall be dated and shall be filed with the
records at such meeting.
SECTION 1.8. ORGANIZATION. At every meeting of shareholders, the
Chairman of the Board, a Vice Chairman, or the President shall preside as
Chairman of the meeting and the Cashier or other officer or director shall act
as Secretary. A full record of each meeting shall be made by the secretary and
such minutes shall be retained in the records of the Bank. At every annual
meeting the Chief Executive Officer shall report on the operations of the Bank
during the preceding year.
SECTION 1.9. JUDGES OF ELECTION. The Board of Directors or the
officer presiding at the annual meeting may appoint one or more
2
<PAGE> 14
judges of election as such appointing authority shall deem necessary to assure
the proper holding of the election of directors; and the judge or judges so
appointed shall, after the election has been held, certify the result thereof,
giving the names of directors. In the event the judge or judges of election
shall be appointed by the Board in advance of the annual meeting and shall for
any reason fail or be unable to serve, a substitute judge or judges may be
appointed at any time prior to the election by either the Board or by the
officer presiding at the annual meeting.
SECTION 1.10. QUORUM. A majority of the outstanding stock,
represented in person or by proxy, shall constitute a quorum at any meeting of
shareholders, unless otherwise provided by law; but less than a quorum may
adjourn any meeting, from time to time, and the meeting may be held, as
adjourned, without further notice.
ARTICLE II
DIRECTORS
SECTION 2.1. BOARD OF DIRECTORS. The Board shall have power to
manage and administer the business and affairs of the Bank. Except as expressly
limited by law, all corporate power of the Bank shall be vested in and may be
exercised by said Board.
SECTION 2.2. NUMBER. The Board shall consist of not less than five
or more than twenty-five members, who shall be shareholders if required by law,
the exact number within such minimum and maximum limits to be fixed and
determined from time to time by resolution of a majority of the full Board or
by resolution of the shareholders at any meeting thereof; provided, however,
that a majority of the full Board of Directors may increase the number of
directors (and appoint persons to fill such positions) to a number which (i)
exceeds by no more than two the number of directors last elected by
shareholders where such number was fifteen or less; and (ii) to a number which
exceeds by no more than four the number of directors last elected by
shareholders where such number was sixteen or more, but in not event shall the
number of directors exceed twenty-five.
SECTION 2.3. REGIONAL, CITY, ADVISORY OR SENIOR DIRECTORS. In the
discretion of the Board of Directors of the Bank, or the Chairman of the Board
and the President, there may be Boards designated as Regional, City, Advisory
or Senior Boards, the members of which shall be elected at one time, or from
time to time, by the Board of Directors of the Bank or appointed by the
Chairman of the Board and the President of the Bank, and the tenure
3
<PAGE> 15
of office of such directors shall be at the will of the Board of Directors or
the Chairman and the President as the case may be. These directors shall not
be entitled to vote, but shall perform such duties, if any, as may from time to
time be required of them by the Board of Directors or the Chairman and the
President.
SECTION 2.4. REGULAR MEETINGS.
A regular meeting of the Board shall be held immediately after the
annual meeting of shareholders. A majority of the entire Board may provide, by
resolution, the time and place for the holding of additional regular meetings.
Such regular meetings may be held without notice of the time, place and purpose
thereof.
SECTION 2.5. SPECIAL MEETINGS. Special Meetings may be called by the
Chairman of the Board, a Vice Chairman, or the President or any three
directors. Notice by mail of at least forty-eight hours or by telephone or in
person or by telegraph of at least twenty-four hours shall be given of every
special meeting. If mailed, such notice shall be deemed to be delivered when
deposited in the United States mail, so addressed, with postage prepaid
thereon. If notice be given by telegram, such notice shall be deemed to be
delivered when the telegram, so addressed is delivered to the telegraph
company. Any director may waive notice of any meeting before, at or after such
meeting, and the attendance of a director at a meeting shall constitute a
waiver of notice of such meeting, except where a director attends for the
express purpose of objecting to the transaction of business thereat on the
ground that the meeting was not lawfully called or convened.
SECTION 2.6. COMPENSATION. The directors may be paid their expenses,
if any, of attendance at each meeting of the Board and each meeting of a
committee, and may, in addition, be paid a fixed sum for serving as a Director
and for attendance at each such meeting. No such payment shall preclude any
director from serving the Bank in any other capacity and receiving compensation
therefor; provided however, that no director who is also an officer (other
than one holding an honorary position) shall be compensated in addition to his
normal salary.
SECTION 2.7. QUORUM. A majority of the directors shall constitute a
quorum at any meeting, except when otherwise provided by law; but a less number
may adjourn any meeting, from time to time, and the meeting may be held, as
adjourned, without further notice.
SECTION 2.8. MANNER OF ACTING. The act of the majority of the
directors present at a meeting at which a quorum is present shall, unless
otherwise provided by law or these By-Laws, be the act of the Board. Directors
may participate in any meetings, or the meeting may be conducted by means of
communications equipment
4
<PAGE> 16
whereby all persons participating can simultaneously hear each other. A
director participating in a meeting by this means is deemed to be present in
person at the meeting. Any action required or permitted to be taken at a
meeting of directors, may be taken without a meeting if a consent in writing,
setting forth the action so taken, shall be signed by all of the directors.
Such written consent shall have the same force and effect as a unanimous vote.
SECTION 2.9. PRESUMPTION OF ASSENT. A director of the Bank who is
present at a meeting of the Board at which action on any Bank matter is taken
shall be presumed to have assented to the action taken unless his dissent shall
be entered in the minutes of the meeting, or unless he shall file his written
dissent to such action with the person acting as Secretary of the meeting
before the adjournment thereof.
SECTION 2.10. VACANCIES. When any vacancy occurs among the directors
(including any vacancy resulting from increasing the Board by resolution of the
directors in accordance with Section 2.2. of these By-Laws) the remaining
members of the Board, in accordance with the laws of the United States, may
appoint a director to fill such vacancy at any regular meeting of the Board, or
at a special meeting called for that purpose.
SECTION 2.11. AGE LIMITATIONS ON DIRECTORS. No person shall be
elected or reelected a Director of the Bank after he reaches age seventy (70),
except that a Director who is also serving as a Director of First American
Corporation may be elected, or reelected, as a Director of the Bank without
regard to age.
ARTICLE III
COMMITTEES
SECTION 3.1. EXECUTIVE COMMITTEE. There shall be an Executive
Committee of the Board consisting of (i) the Chairman, (ii) the President,
(iii) such other directors who shall be elected by the Board, and (iv)
additional directors as may be selected by the Chairman of the Committee to
serve on a quarterly basis and to be succeeded by other directors to the end
that all directors, if available, may serve on the Executive Committee from
time to time on a quarterly basis. The Board shall appoint from among the
members of the Committee a chairman thereof, who shall preside at meetings of
the Committee and shall direct its work. Except for matters which cannot by
law be delegated by the Board, the Executive Committee shall have all the
powers of the Board in the management and conduct of the business and affairs
of the Bank in the intervals between meetings of the Board.
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SECTION 3.2. AUDIT COMMITTEE. There shall be an Audit Committee
composed of not less than three directors elected by the Board, none of whom
shall be officers employed on a regular full-time basis by the Bank or by First
American Corporation or any of its affiliates. The Audit Committee shall be a
joint committee of the Bank and First American Corporation, and shall serve as
the Audit Committee for both. The Board shall appoint from among the members
of the Committee a chairman thereof, who shall preside at meetings of the
Commititee and shall direct its work.
It shall be the duty of the Committee to make or cause to be made on
its behalf and under its supervision, not less frequently than annually,
regular and periodic audit examinations into the affairs of the Bank and to
report its findings to the Board. Auditors whose services are utilized by the
Committee may be in the regular employ of First American Corporation but in
connection with such audit examinations shall be responsible to the Audit
Committee and the Board of the Bank. It shall be the duty of such auditors of
the Audit Committee to establish and maintain adequate, proper, effective, and
continuing audit controls and procedures in all departments of the Bank so as
to accurately set forth the Bank's condition and to fulfill legal and
regulatory requirements.
SECTION 3.3. COMMUNITY AFFAIRS COMMITTEE. There shall be a Community
Affairs Committee composed of at least three Directors elected by the Board, at
least two of whom shall not be employed on a regular full-time basis by the
Bank or by First American Corporation or any of its affiliates. The Community
Affairs Committee shall be a joint committee of the Bank and First American
Corporation and shall serve both. The Board shall appoint from among the
members of the Committee a chairman thereof, who shall preside at meetings of
the Committee and shall direct its work. It shall be the duty of the Committee
to advise and counsel management in matters of community activities,
contributions, image issues, government affairs, economic development, and
compliance with the Community Reinvestment Act and other laws or regulations
of a similar purpose; and to perform such other functions as may be assigned to
it by the Board.
SECTION 3.4. HUMAN RESOURCES COMMITTEE. There shall be a Human
Resources Committee composed of at least three Directors elected by the Board,
none of whom shall be employed on a regular full-time basis by the Bank, or by
First American Corporation or any subsidiary thereof. This shall be a joint
committee of the Bank and First American Corporation and shall serve both. The
Board shall appoint from among the members of the Committee a chairman thereof,
who shall preside at meetings of the Committee and shall direct its work.
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This Committee shall oversee all personnel practices and procedures
for all Bank officers and employees, including but not limited to all benefit
programs, salary administration, bonus and incentive plans. The Committee
shall review all actions of management as to the aggregate expenditures for
salaries and shall review specific salaries of certain key personnel; review
Directors' and Officers' and Employees' Standards of Conduct, organizational
structure, recruitment programs, succession and management development plans,
and recommend certain elections and promotions, and perform such other
functions as may be assigned to it by the Board.
SECTION 3.5. DEVELOPMENT COMMITTEE. There shall be a Development
Committee of the Board consisting of not less than three directors elected by
the Board. The Board shall appoint from among the members of the Committee a
Chairman thereof, who shall preside at meetings of the Committee and shall
direct its work.
It shall be the duty of the Committee to oversee and to advise and
counsel management as to the investigation, development and implementation of
non-traditional banking products or services offered through First American
Corporation or its affiliates. The Committee shall also provide general
oversight to First American National Bank's corporate and personal trust
services, as well as services offered incidentally thereto, such as investment
management. The Committee shall also review preliminary reports and
recommendations concerning stragetic growth through mergers and acquisitions.
The Committee shall ensure that all such activities are undertaken and
conducted in accordance with applicable laws and reguations, corporate policy
and sound financial planning. The Committee shall also perform such other
functions as may be assigned to it by the Board.
SECTION 3.6. ASSET POLICY COMMITTEE. There shall be an Asset Policy
Committee composed of not less than five directors elected by the Board, at
least four of whom shall not be employed on a regular full-time basis by the
Bank or First American Corporation or any subsidiary thereof. This shall be a
joint committee of the Board and First American Corporation and shall serve
both. The Board shall appoint from among the members of the Committee a
chairman thereof, who shall preside at meetings of the Committee and shall
direct its work.
The Committee shall have responsibility for all credit related matters,
including approval of credit policies and procedures, monitoring the loan
portfolio, review of significant transactions, review of credit examinations,
compliance with regulatory requirements and applicable laws and regulations,
review of internal and external audits, review of the allowance for loan
losses, and review of regulatory examinations. The Asset Policy
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Committee shall also regularly review asset/liability policies and procedures,
asset quality reports, and the policies and procedures of the Capital Markets
Group. The Asset Policy Committee shall perform such other duties as may be
assigned to it from time to time by the Board.
SECTION 3.7. OTHER COMMITTEES AND SUBCOMMITTEES. The Board may
appoint such other committees and/or subcommittees of one or more persons as it
may determine will be helpful in discharging its responsibility for the
management and administration of the Bank. Each such other committee shall
consist of such directors, officers and others as may be appointed by the
Board, and shall perform such functions and possess such powers as may be
assigned to it by the Board. Such committees may be designated by the Board
as "boards", but such designation, if any, shall not alter their powers or
responsibilities.
SECTION 3.8. COMPENSATION. The chairman and members of all committees
shall receive such compensation for their as may be fixed by the Board, but no
director who is also an officer (other than one holding an honorary position)
shall be compensated in addition to his normal salary.
SECTION 3.9. MEETINGS. Regular meetings of any standing or special
committee may be held without call or notice at such times or places as such
committee from time to time may fix. Other meetings of any such committee may
be called by the Chairman of the Committee or any two members of any such
committee upon giving notice of the time, place and purposes of each such
meeting to each member at either his business or residence address, as shown by
the records of the Secretary, at least twenty-four hours previously thereto if
delivered in person or given orally, or by telephone or telegraph. If mailed,
such notice shall be deemed to be delivered when deposited in the United States
mail, so addressed, with postage prepaid thereon. If notice be given by
telegram, such notice shall be deemed to be delivered when the telegram, so
addressed is delivered to the telegraph company. Any member may waive notice
of any meeting and the attendance of a member at a meeting shall constitute a
waiver of notice of such meeting except where a member attends for the express
purpose of objecting to the transaction of business thereat on the ground that
the meeting is not lawfully called or convened. A majority of the directors
serving as members of any committee at the time of any meeting shall constitute
a quorum at such meeting; but a less number may adjourn any meeting from time
to time, and the meeting may be held, as adjourned, without further notice.
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ARTICLE IV
OFFICERS AND EMPLOYEES
SECTION 4.1. CHAIRMAN OF THE BOARD. The Board may appoint one of its
members to be Chairman of the Board. Such Chairman shall preside at meetings
of the Board and shall perform such duties and exercise such powers as
reasonably may be assigned to him by the Board.
SECTION 4.2. VICE CHAIRMAN OF THE BOARD. The Board may appoint one
or more Vice Chairmen, who need not be Board members, with such duties and
powers as may be assigned by the Board, the Chairman of the Board or the Chief
Executive Officer.
SECTION 4.3. PRESIDENT. The Board shall appoint one of its members
to be President of the Bank. The President shall have such duties and exercise
such powers as reasonably may be assigned to him by the Board, or the Chief
Executive Officer.
SECTION 4.4. CHIEF EXECUTIVE OFFICER. The Board shall appoint one of
its members to be Chief Executive Officer of the Bank. He may exercise all the
powers customarily exercised by the Chief Executive Officer of a national
banking association. The Chief Executive Officer shall have general
supervision of all policies and operations of all of the divisions of the Bank.
All officers of the Bank shall report to him to the extent he may at any time
require. In the absence of the Chairman of the Board, or, if no Chairman of
the Board is appointed, the Chief Executive Officer shall preside at meetings
of the Board. In the absence of the Chief Executive Officer, or upon his
inability to act, or if said office shall become vacant, his duties shall be
performed by a Vice Chairman, if any, or such person or persons as shall be so
designated by the Board.
SECTION 4.5. CHAIRMAN OF THE EXECUTIVE COMMITTEE. The Board shall
appoint one of its members to be Chairman of the Executive Committee. Such
Chairman shall preside at meetings of the Executive Committee and shall perform
such other duties and exercise such powers as reasonably may be assigned to him
by the Board. In the absence of the Chairman of the Executive Committee, the
Chairman of the Board or the President shall preside at meetings of the
Committee.
SECTION 4.6. EXECUTIVE AND SENIOR VICE PRESIDENTS. The Board or the
Human Resources Committee shall appoint one or more Executive or Senior Vice
Presidents, except that those designated as Regulation O executive officers
based upon their roles in First American Corporation or First American National
Bank shall be appointed solely by the Board. Each Executive or Senior Vice
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President shall have such powers and duties as may be assigned to him by the
Board, the Human Resources Committee, or the Chief Executive Officer of the
Bank.
SECTION 4.7. SECRETARY OF THE BOARD. The Board shall appoint a
person who shall be Secretary of the Board and who shall keep accurate minutes
of all meetings. He shall attend to the giving of all notices required by
these By-Laws to be given. The Board may also appoint one or more Assistant
Secretaries of the Board who shall assist the Secretary in the performance of
his duties and shall perform such other duties as may be assigned by the Board
or the Chief Executive Officer.
SECTION 4.8. CASHIER. The Board shall appoint a Cashier. Except as
otherwise required by these By-Laws, the Cashier shall be custodian of the
corporate seal, records, documents and papers of the Bank and shall provide for
the keeping of proper records of all transactions of the Bank. He shall have
and may exercise any and all other powers and duties pertaining by law,
regulation or practice, to the office of Cashier, or imposed by these By-Laws.
He shall also perform such other duties as may be assigned to him from time to
time by the Board. The Board may, in its discretion, assign any or all of the
aforesaid duties to one or more other officers.
SECTION 4.9. VICE PRESIDENTS AND OTHER OFFICERS. The Board, the
Chairman of the Board or the President may appoint Vice Presidents and such
other officers and Attorneys-in-Fact, not specifically provided for by these
By-Laws, with such titles and descriptions, as from time to time may appear to
the Board, the Chairman of the Board or the President to be required or
desirable to transact the business of the Bank. Such officers shall
respectively exercise such powers and perform such duties as pertain to their
several offices, or as may be conferred upon, or assigned to, them by the
Board, the Chairman of the Board or the President of the Bank.
SECTION 4.10. TENURE OF OFFICE. All officers of the Bank shall be
elected by the Board at its first meeting after each annual meeting of
shareholders. Unless he shall resign, become disqualified or be removed, each
officer shall continue in his office until the Board shall again elect officers
following the next succeeding annual meeting of shareholders. The Board, at
any time, may remove with or without cause, any officer, may fill any vacancies
and may appoint additional officers. The Chairman of the Board or the
President may at any time remove any officer.
SECTION 4.11. EMPLOYEES OTHER THAN OFFICERS. Subject to the
authority of the Board, the Chief Executive Officer of the Bank, or any other
officer authorized by him, may employ such other clerks, agents, employees,
consultants, attorneys, accountants, etc. as he
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may deem advisable for the prompt and orderly transaction of the business of
the Bank, define their duties, titles and descriptions, fix the compensation to
be paid them and dismiss them.
SECTION 4.12. BONDING. All officers and employees, as a group, shall
be bonded for the faithful performance of duties and against loss to the Bank
resulting from their misconduct by a reliable surety company selected by the
Board and in such amount as shall be determined, from time to time, by the
Board.
SECTION 4.13. RETIREMENT OF OFFICERS AND EMPLOYEES. Any officer or
salaried employee of the Bank shall retire at the end of the month in which he
or she reaches age sixty-five (65) or, if mandatory retirement at such age
shall be prohibited by law, at such next older age as shall be legally
permissible. Provided, however, that the Board of Directors by specific action
may delay for not more than one (1) year beyond the mandatory retirement age
set forth in the preceding sentence, the retirement of any officer or salaried
employee who is performing such services for the Bank that continuation in
active employment is deemed by the Board to be in the best interest of the
Bank. Provided, further, that if deemed in the best interest of the Bank, the
Board, by specific action and as an alternative to extension of the retirement
age of such officer or salaried employee, may employ him or her in a consulting
capacity for a reasonable time beyond his or her mandatory retirement age.
ARTICLE V
STOCK AND STOCK CERTIFICATES
SECTION 5.1. TRANSFERS. Shares of stock shall be transferable on the
records of the Bank, and transfer records shall be kept in which all transfers
of stock shall be recorded. Every person becoming a shareholder by such
transfer shall, in proportion to his shares, succeed to all rights and
liabilities of the prior holder of such shares.
SECTION 5.2. STOCK CERTIFICATES. Certificates of stock shall bear
the signature of the Chairman of the Board or the President (which may be
engraved, printed or impressed), and shall be signed manually or by facsimile
process by any Vice President or any Assistant Vice President or the Cashier or
any other officer appointed by the Board for that purpose, to be known as an
Authorized Officer, and the seal of the Bank shall be affixed manually or
engraved thereon. Each certificate shall recite on its face that the stock
represented thereby is transferable only upon the records of the Bank when
properly endorsed.
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ARTICLE VI
CORPORATE SEAL
SECTION 6.1. CORPORATE SEAL. The Chairman of the Board, a Vice
Chairman, the President, the Secretary, the Cashier, or any Vice President,
Assistant Secretary or Assistant Cashier or any other officer thereunto
designated by the Board, shall have authority to affix the corporate seal to
any document requiring such seal, and to attest the same. Such seal shall be
substantially in the following form:
ARTICLE VII
EMERGENCIES AND DISASTERS
SECTION 7.1. APPLICATION. The emergency procedures and authorities
established by these By-Laws shall be valid and operable only in the event of
an emergency declared by the President of the United States or person
performing his functions, the outbreak of actual war, or the occurrence of
warlike damage or disaster. Any of the emergency provisions outlined in
Article VII of the By-Laws may be invalidated by a majority of directors
present at any meeting of the Board for which reasonable notice has been given.
SECTION 7.2. EMERGENCY OPERATIONS. In the event of an emergency as
contemplated by these By-Laws, the officers and employees of the Bank will
continue to conduct the affairs of the Bank to the extent possible under the
authority of the Board of Directors, but subject to any lawful rule,
regulation, instruction or direction from the President of the United States or
the person performing his functions.
SECTION 7.3. INTERIM EXECUTIVE COMMITTEE. In the event of a state of
disaster of sufficient severity to prevent the conduct and management of the
affairs and business of the Bank by its directors and officers as contemplated
by these By-Laws, any two (2) or more available members of the then incumbent
Executive Committee shall constitute a quorum of that committee for the full
conduct and management of the affairs and business of the Bank, and shall be
empowered to exercise all of the powers of the Board of Directors and any
committee thereof. In the event of the unavailability at such time of a
minimum of two (2) members of the
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then incumbent Executive Committee, any three (3) available directors shall
constitute the Executive Committee for the full conduct and management of the
affairs and business of the Bank. Should there be less than three (3) directors
available, any remaining directors and the remaining officers of the Bank shall
by majority vote elect three (3) individuals to serve as an Interim Executive
Committee and shall call as soon as practical a meeting of shareholders for the
purpose of the election of directors.
SECTION 7.4. OFFICER SUCCESSION. In the event of an emergency as
contemplated by this Article VII of the By-Laws and if the Chief Executive
Officer of the Bank cannot be located or is unable to assume or to continue
normal executive duties, then the authority and duties of the Chief Executive
Officer shall without further action of the Board of Directors be automatically
assumed by the next most senior officer in title available. Within titles of
the same rank, the individual with the greatest number of years service with
the Bank shall assume the position of authority as Chief Executive Officer.
Any person who in accordance with these By-Laws assumes the authority and
duties of the Chief Executive Officer shall continue to serve until he resigns,
until three quarters (3/4) of the other available officers of the bank shall
decide in writing he is unable to perform said duties, until the elected Chief
Executive Officer of the Bank becomes available or able to perform the duties
of the Chief Executive Officer, a person of higher rank becomes available, or
until replaced by the Board of Directors of the Executive Committee as
regularly constituted or as constituted as hereinabove provided under emergency
conditions.
SECTION 7.5. CERTIFICATION OF INCUMBENCY. Anyone dealing with this
bank may accept its certification by any three (3) officers that a specified
individual is acting as Chief Executive Officer in accordance with the
emergency provisions of these By-Laws, and that anyone accepting such
certificate may continue to consider it in force until notified in writing of a
change, with such notice of change to carry the signature of three (3) officers
of the Bank.
SECTION 7.6. ALTERNATE LOCATIONS. During an emergency resulting in
any authorized place of business of the Bank being unable to function, the
business ordinarily conducted at such location shall be relocated elsewhere in
suitable quarters as may be designated by the Board of Directors or by the
Executive Committee or by those otherwise authorized in the time of emergency
to conduct the affairs of the Bank. Any temporarily relocated place of
business of the Bank shall be returned to its legally authorized location as
soon as practical and such temporary place of business shall then be
discontinued.
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ARTICLE VIII
INDEMNIFICATION OF DIRECTORS, OFFICERS AND EMPLOYEES
SECTION 8.1. APPLICATION. Any director, officer or employee who is
made, or threatened to be made a party to any proceeding, whether civil,
criminal, administrative or investigative, by reason of the fact of his
capacity as such director, officer or employee shall be indemnified to the
fullest extent permitted by applicable law and regulation against judgments,
fines, amounts paid in settlement and reasonable expenses, including attorney
fees actually and necessarily incurred as a result of such proceeding, or any
appeal therein, provided he acted in good faith for a purpose which he
reasonably believed to be in the best interest of the Bank
SECTION 8.2. INDEMNIFICATION PROHIBITED. No indemnification will be
provided in the event that a supervisory action results in a final order
assessing civil money penalties or requiring affirmative action in the form of
payments to the Bank. No director, officer, or employee who shall be adjudged
guilty of, or liable for, willful misconduct, gross neglect of duty, or
criminal acts shall be indemnified in any manner whatsoever.
SECTION 8.3. DEFENSES NOT WHOLLY SUCCESSFUL. Any indemnification to
a director, officer, or employee who has not been wholly successful, on the
merits or otherwise, in the defense of a proceeding, unless ordered by a court,
shall be made only if authorized (1) by the Board of Directors acting by a
quorum consisting of directors who are not parties to the proceeding upon a
finding that the Director, Officer or Employeehas met the standard of conduct
set forth in Section 8.1.; (2) by the Board upon the written opinion of
independent legal counsel that indemnification is proper because the standard
of conduct has been met, if such a quorum is not obtainable with due diligence
or (3) by the shareholders upon a finding that the standard of conduct has been
met.
SECTION 8.4. ADVANCED EXPENSES. Expenses incurred in defending a
civil or criminal action, suit or proceeding may be paid by the Bank in advance
of the final disposition of such action, suit or proceeding if authorized in
accordance with Section 8.3. of these By-Laws. All expenses incurred in
defending a civil or criminal action which are advanced by the Bank shall be
repaid if the director, officer or employee shall have been ultimately found
not to be entitled to indemnification, or where indemnification is granted, to
the extent the expenses advanced by the Bank or allowed by the Court exceed the
indemnification to which said person is entitled.
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SECTION 8.5. SHAREHOLDER NOTICE. If any indemnification, advancement
or allowance has been made pursuant to these By-Laws, notice shall be given at
the next annual meeting of shareholders of the persons paid, the amounts paid,
and the nature and status at the time of the payment of the proceeding or
threatened proceeding.
SECTION 8.6. INSURANCE. The Bank shall purchase insurance coverage
for the purpose of indemnifying its directors, officers, and employees. Said
insurance shall be for such terms, and in such amounts as may be approved by
the Board from time to time. Such insurance shall not insure the directors,
officers, and employees against a final supervisory order assessing civil money
penalties.
ARTICLE IX
MISCELLANEOUS PROVISIONS
SECTION 9.1. BANKING HOURS. The Bank shall be open for business
during such hours and on such days of the year as the Board or the Chief
Executive Officer of the Bank shall direct, except for days declared or
designated as bank holidays by proper Federal or State authority; such business
days and hours may vary or differ as between any of the Bank's various branches
or departments.
SECTION 9.2. FISCAL YEAR. The fiscal year of the Bank shall be the
calendar year.
SECTION 9.3. SECURITIES OF OTHER CORPORATIONS. Unless otherwise
provided by the Board, the Chairman of the Board, any Vice Chairman, the
President, any Vice President, the Cashier, or any Trust Officer, may from time
to time appoint an attorney or attorneys or agent or agents of the Bank, in the
name and on behalf of the Bank (whether in a trust capacity or not) to cast the
votes which the Bank may be entitled to cast as a shareholder or otherwise in
any other corporation, any of whose stock or securities may be registered in
the name of the Bank, or in the name of the Bank's nominee, at meetings of the
holders of the stock or other securities of such other corporation, or to
consent in writing to any action by any such other corporation, and may
instruct the person or persons so appointed as to the manner of casting such
votes of giving such consent, and may execute or cause to be executed on behalf
of the Bank and under its corporate seal, or otherwise, such written proxies,
consents, waivers of other instruments as he may deem necessary or proper in
the premises; or any such officer may consent in writing to any action by any
such other corporation or himself attend any meeting of the holders of
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stock or other securities of any such other corporation and there at vote or
exercise any or all other powers of the Bank as the holder of such stock or
other securities of such other corporation.
SECTION 9.4. DIVIDENDS. Dividends (which may be designated by the
Board as Special Dividends) may be declared from time to time by the Board of
Directors when funds are lawfully available for the purpose. Such declaration
shall fix the date of payment of the dividend and the date on which
shareholders of record are to be determined for the purpose of such payment,
but the stock transfer books shall not be closed at any time for the purpose of
declaring or paying a dividend.
SECTION 9.5. EXECUTION OF INSTRUMENTS. All agreements, contracts,
indentures, mortgages, deeds, conveyances, transfers, certificates,
declarations, receipts, discharges, releases, satisfactions, settlements,
petitions, schedules, accounts, affidavits, bonds, undertakings, proxies and
other instruments or documents may be signed, executed, acknowledged, verified,
delivered or accepted on behalf of the Bank by the Chairman of the Board, any
Vice Chairman of the Board, the President, the Cashier, the Secretary, any
Executive Vice President, Senior Vice President, or, if in connection with the
exercise of fiduciary powers of the Bank, by any of said officers or by any
Trust Officer. Any such instruments may also be executed, acknowledged,
verified, delivered or accepted on behalf of the Bank in such other manner and
by such others as the Board may from time to time direct. The provisions of
this Section 9.5. are supplementary to other provisions of these By-Laws.
SECTION 9.6. RECORDS. The Articles of Association, the By-Laws and
the proceedings of all meetings of the shareholders, the Board and the standing
committees of the Board, shall be recorded in appropriate minute books provided
for the purpose. The minutes of each meeting shall be signed by the Secretary
of the meeting.
SECTION 9.7. GENDER. When used herein, the masculine gender shall
include the feminine.
ARTICLE X
WAIVER OF NOTICE
SECTION 10.1. WAIVER OF NOTICE. Unless otherwise provided by law,
whenever any notice is required to be given to any shareholder or director, or
member of any Committee of the Bank
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under the provisions of these By-Laws, a waiver thereof in writing, signed by
the person or persons entitled to such notice, whether before or after the time
stated therein, shall be deemed equivalent to the giving of such notice.
ARTICLE XI
BY-LAWS
SECTION 11.1. INSPECTION. A copy of the By-Laws, with all
amendments thereto, shall at all times be kept in a convenient place at the
Main Office of the Bank, and shall be open for inspection to all shareholders,
during banking hours.
SECTION 11.2. AMENDMENTS. The By-Laws may be amended, altered or
repealed, at any regular meeting of the Board or at any special meeting called
for the purpose, by a vote of a majority of the Directors then in office.
ARTICLE XII
TRUST GROUP
SECTION 12.1. TRUST GROUP. There shall be a group of the Bank known
as the Trust Group which shall perform the fiduciary responsibilities of the
Bank.
SECTION 12.2. TRUST OFFICERS. The Board shall appoint one or more
officers in the Trust Group as trust officers although the individual officers
may have other officer titles consistent with the Bank's policy relating to
officer titles. One of the trust officers shall be designated as the Trust
Manager to manage, supervise and direct all of the activities of the Trust
Group, subject to the supervision of the Bank's Trust Committee and the Board.
Subject to such supervision and authority, he shall do, or cause to be done,
all things necessary or proper in carrying on the business of the Trust Group
in accordance with provisions of law and applicable regulations. He shall act
pursuant to opinion of counsel where such opinion is deemed necessary. Opinions
of counsel shall be retained on file in connection with all important matters
pertaining to fiduciary activities. Such Trust Manager shall be responsible
for all assets and documents held by the bank in connection with fiduciary
matters. Another of the trust officers shall be designated as Trust Counsel to
review and render advice to trust personnel on trust instruments, laws and
regulatory matters affecting the Trust Group, certify Fiduciary Resolutions,
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serve as Secretary of the Trust Committee and the Investment Review Committee,
and perform such other duties as may be assigned to him by the Trust Manager or
the Trust Committee from time to time, where not inconsistent with
responsibilities otherwise assigned to the General Counsel, or the Legal
Division.
SECTION 12.3. TRUST COMMITTEE. There shall be a Trust Committee of
the Board which shall consist of the Chairman of the Bank and such other
directors and officers as may be elected thereto by the Board. The Trust
Committee shall develop general polcies for conducting the trust business of
the Bank, and policies and procedures concerning the investment and disposition
of property held in a fiduciary capacity, and generally review the operations
of the Trust Group in all of its trust, investment management, and other
fiduciary capacities, including compliance by the Trust Group with laws and
regulations applicable to fiduciary powers of national banks and collective
investment funds, and shall keep minutes of all its meetings showing the
disposition of all matters considered and passed upon by it. The Board of
Directors of the Bank, or the Trust Committee may appoint such subcommittees as
either may deem necessary or appropriate.
SECTION 12.4. TRUST AUDIT COMMITTEE. The Trust Audit Committee shall
be the Committee appointed under Section 3.2. of these By-Laws and shall, at
least once during each calendar year and within fifteen months of the last such
audit make suitable audits of the Trust Group of cause suitable audits to be
made, and at such time shall ascertain whether the group has been administered
in accordance with law, Regulation 9, and sound fiduciary principles. The
auditors of the affairs of the Trust Group shall be responsible only to the
Board.
SECTION 12.5. TRUST GROUP FILES. There shall be maintained in the
Trust Group files containing all fiduciary records necessary to assure that its
fiduciary responsibilities have been properly undertaken and discharged.
SECTION 12.6. TRUST INVESTMENT. Funds held in a fiduciary or
similar capacity shall be invested in accordance with the instrument
establishing the fiduciary or other relationship and law as applicable.
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EXHIBIT 6
THE CONSENTS OF UNITED STATES INSTITUTIONAL TRUSTEES
REQUIRED BY SECTION 321(b) OF THE ACT
<PAGE> 31
CONSENT OF TRUSTEE
Pursuant to the requirements of Section 321(b) of the Trust Indenture
Act of 1939 in connection with the proposed issue of 6.0% Senior Subordinated
Convertible Debentures Due 2000, of National HealthCare L.P., we hereby consent
that reports of examinations by federal, state, territorial or district
authorities may be furnished by such authorities to the Securities and Exchange
Commission upon request therefor.
FIRST AMERICAN NATIONAL BANK
BY: /s/ Brenda Landers
-------------------------
Brenda Landers
Vice President
Dated: August 25, 1995
<PAGE> 32
EXHIBIT 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
<PAGE> 33
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Board of Governors of the Federal Reserve System
OMB Number: 7100-0036
Federal Deposit Insurance Corporation
OMB Number: 3064-0052
Office of the Comptroller of the Currency
OMB Number: 1557-0081
FEDERAL FINANCIAL INSTITUTIONS EXAMINATION COUNCIL Expires March 31, 1996
- -------------------------------------------------------------------------------------------------------------------------
[1]
[LOGO] Please refer to page i,
Table of Contents, for
the required disclosure
of estimated burden.
- -------------------------------------------------------------------------------------------------------------------------
CONSOLIDATED REPORTS OF CONDITION AND INCOME FOR
A BANK WITH DOMESTIC AND FOREIGN OFFICES - FFIEC 031
(950630)
-----------
REPORT AT THE CLOSE OF BUSINESS JUNE 30, 1995 (RCRI 9999)
This report is required by law: 12 U.S.C. Section 324 (State This report form is to be filed by banks with
member banks); 12 U.S.C. Section 1817 (State nonmember branches and consolidated subsidiaries in U.S.
banks); and 12 U.S.C. Section 161 (National banks). territories and possessions, Edge or Agreement
subsidiaries, foreign branches, consolidated
foreign subsidiaries, or International Banking
Facilities.
- -------------------------------------------------------------------------------------------------------------------------
NOTE: The Reports of Condition and Income must be signed by The Reports of Condition and Income are to be
an authorized officer and the Report of Condition must be prepared in accordance with Federal regulatory
attested to by not less than two directors (trustees) for authority instructions. NOTE: These instructions may
State nonmember banks and three directors for State member in some cases differ from generally accepted
and National banks. accounting principles.
I, M. Jack Vannatta, Controller We, the undersigned directors (trustees), attest to
-------------------------------------------------------- the correctness of this Report of Condition
Name and Title of Officer Authorized to Sign Report (including the supporting schedules) and declare that
it has been examined by us and to the best of our
of the named bank do hereby declare that these Reports of knowledge and belief has been prepared in conformance
Condition and Income (including the supporting schedules) with the instructions issued by the appropriate
have been prepared in conformance with the instructions Federal regulatory authority and is true and correct.
issued by the appropriate Federal regulatory authority and
are true to the best of my knowledge and belief. /s/ Robert A. McCabe, Jr.
---------------------------------------------------------
Director (Trustee)
/s/ M. Jack Vannatta, Controller
- ------------------------------------------------------------- /s/ Dennis C. Bottorff
Signature of Officer Authorized to Sign Report ---------------------------------------------------------
Director (Trustee)
July 25, 1995 /s/ David K. Wilson
- ------------------------------------------------------------- ---------------------------------------------------------
Date of Signature Director (Trustee)
- -------------------------------------------------------------------------------------------------------------------------
FOR BANKS SUBMITTING HARD COPY REPORT FORMS:
STATE MEMBER BANKS: Return the original and one copy to the NATIONAL BANKS: Return the original only in the
appropriate Federal Reserve District Bank. special return address envelope provided. If express
mail is used in lieu of the special return address
STATE NONMEMBER BANKS: Return the original only in the envelope, return the original only to the FDIC, c/o
special return address envelope provided. If express mail is Quality Data Systems, 2127 Espey Court, Suite 204,
used in lieu of the special return address envelope, return Crofton, MD 21114.
the original only to the FDIC, c/o Quality Data Systems,
2127 Espey Court, Suite 204, Crofton, MD 21114.
- -------------------------------------------------------------------------------------------------------------------------
FDIC Certificate Number 04956 Banks should affix the address label in this space.
---------
(RCRI 9050) First American National Bank
---------------------------------------------------------
Legal Title of Bank (TEXT 9010)
Nashville
---------------------------------------------------------
City (TEXT 9130)
TN 37237
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State Abbrev. (TEXT 9200) ZIP Code (TEXT 9220)
Board of Governors of the Federal Reserve System, Federal Deposit Insurance Corporation, Office of the Comptroller of the Currency
</TABLE>
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FFIEC 031
Page i
[2]
Consolidated Reports of Condition and Income for
A Bank With Domestic and Foreign Offices
- ---------------------------------------------------------------------------------------------------------------------
TABLE OF CONTENTS
SIGNATURE PAGE COVER REPORT OF CONDITION
REPORT OF INCOME
Schedule RI--Income Statement . . . . . . . . . . RI-1, 2, 3 Schedule RC--Balance Sheet . . . . . . . . . RC-1, 2
Schedule RI-A--Changes in Equity Capital . . . . . . . RI-4 Schedule RC-A--Cash and Balances Due
Schedule RI-B--Charge-offs and Recoveries and From Depository Institutions . . . . . . . . RC-3
Changes in Allowance for Loan and Lease Schedule RC-B--Securities . . . . . . . . RC-3, 4, 5
Losses . . . . . . . . . . . . . . . . . . . . . RI-4, 5 Schedule RC-C--Loans and Lease Financing
Schedule RI-C--Applicable Income Taxes by Receivables:
Taxing Authority . . . . . . . . . . . . . . . . . . RI-5 Part I. Loans and Leases . . . . . . . . . RC-6, 7
Schedule RI-D--Income from Part II. Loans to Small Businesses and
International Operations . . . . . . . . . . . . . . RI-6 Small Farms (included in the forms for
Schedule RI-E--Explanations . . . . . . . . . . . . RI-7, 8 June 30 only) . . . . . . . . . . . . . RC-7a, 7b
Schedule RC-D--Trading Assets and Liabilities
(to be completed only by selected banks) . . RC-8
Schedule RC-E--Deposit Liabilities . . RC-9, 10, 11
Schedule RC-F--Other Assets . . . . . . . . . . RC-11
Schedule RC-G--Other Liabilities . . . . . . . RC-11
Schedule RC-H--Selected Balance Sheet Items
for Domestic Offices . . . . . . . . . . . . RC-12
Schedule RC-I--Selected Assets and Liabilities
Disclosure of Estimated Burden of IBFs . . . . . . . . . . . . . . . . . . . RC-13
Schedule RC-K--Quarterly Averages . . . . . . . RC-13
The estimated average burden associated with this Schedule RC-L--Off-Balance Sheet
information collection is 31.6 hours per respondent and is Items . . . . . . . . . . . . . . . . RC-14, 15, 16
estimated to vary from 15 to 225 hours per response, Schedule RC-M--Memoranda . . . . . . . . . RC-17, 18
depending on individual circumstances. Burden estimates Schedule RC-N--Past Due and Nonaccrual
include the time for reviewing instructions, gathering and Loans, Leases, and Other Assets . . . . . RC-19, 20
maintaining data in the required form, and completing the Schedule RC-O--Other Data for Deposit
information collection, but exclude the time for compiling Insurance Assessments . . . . . . . . . . RC-21, 22
and maintaining business records in the normal course of a Schedule RC-R--Risk-Based Capital . . . . . RC-23, 24
respondent's activities. Comments concerning the accuracy of Optional Narrative Statement Concerning the
this burden estimate and suggestions for reducing this Amounts Reported in the Reports
burden should be directed to the Office of Information and of Condition and Income . . . . . . . . . . . RC-25
Regulatory Affairs, Office of Management and Budget,
Washington, D.C. 20503, and to one of the following: SPECIAL REPORT (TO BE COMPLETED BY ALL BANKS)
Secretary Schedule RC-J--Repricing Opportunities (sent only to
Board of Governors of the Federal Reserve System and to be completed only by savings banks)
Washington, D.C. 20551
Legislative and Regulatory Analysis Division
Office of the Comptroller of the Currency
Washington, D.C. 20219
Assistant Executive Secretary
Federal Deposit Insurance Corporation
Washington, D.C. 20429
For information or assistance, National and State nonmember banks should contact the FDIC's Call Reports Analysis
Unit, 550 17th Street, NW, Washington D.C. 20429, toll free on (800) 688-FDIC (3342), Monday through Friday between
8:00 a.m. and 5:00 p.m., Eastern time. State member banks should contact their Federal Reserve District Bank.
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Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-1
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
CONSOLIDATED REPORT OF INCOME
FOR THE PERIOD JANUARY 1, 1995 - JUNE 30, 1995
All Report of Income schedules are to be reported on a calendar year-to-date
basis in thousands of dollars.
SCHEDULE RI--INCOME STATEMENT
<TABLE>
<CAPTION>
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I480 <-
------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Interest income:
a. Interest and fee income on loans:
(1) In domestic offices:
(a) Loans secured by real estate............................................... 4011 95,728 1.a.(1)(a)
(b) Loans to depository institutions........................................... 4019 413 1.a.(1)(b)
(c) Loans to finance agricultural production and other loans to farmers........ 4024 228 1.a.(1)(c)
(d) Commercial and industrial loans............................................ 4012 51,573 1.a.(1)(d)
(e) Acceptances of other banks................................................. 4026 5 1.a.(1)(e)
(f) Loans to individuals for household, family, and other personal expenditures:
(1) Credit cards and related plans......................................... 4054 3,700 1.a.(1)(f)(1)
(2) Other.................................................................. 4055 36,960 1.a.(1)(f)(2)
(g) Loans to foreign governments and official institutions..................... 4056 0 1.a.(1)(g)
(h) Obligations (other than securities and leases) of states and political
subdivisions in the U.S.:
(1) Taxable obligations.................................................... 4503 0 1.a.(1)(h)(1)
(2) Tax-exempt obligations................................................. 4504 2,949 1.a.(1)(h)(2)
(i) All other loans in domestic offices........................................ 4058 9,092 1.a.(1)(i)
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs.................. 4059 0 1.a.(2)
b. Income from lease financing receivables:
(1) Taxable leases................................................................. 4505 5,292 1.b.(1)
(2) Tax-exempt leases.............................................................. 4307 59 1.b.(2)
c. Interest income on balances due from depository institutions:(1)
(1) In domestic offices............................................................ 4105 15 1.c.(1)
(2) In foreign offices, Edge and Agreement subsidiaries, and IBFs.................. 4106 129 1.c.(2)
d. Interest and dividend income on securities:
(1) U.S. Treasury securities and U.S. Government agency and corporation
obligations.................................................................... 4027 57,238 1.d.(1)
(2) Securities issued by states and political subdivisions in the U.S.:
(a) Taxable securities......................................................... 4506 57 1.d.(2)(a)
(b) Tax-exempt securities...................................................... 4507 174 1.d.(2)(b)
(3) Other domestic debt securities................................................. 3657 5,706 1.d.(3)
(4) Foreign debt securities........................................................ 3658 29 1.d.(4)
(5) Equity securities (including investments in mutual funds)...................... 3659 897 1.d.(5)
e. Interest income from trading assets................................................ 4069 611 1.e.
------------------
</TABLE>
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(1) Includes interest income on time certificates of deposit not held for
trading.
3
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Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-2
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI--CONTINUED
<TABLE>
<CAPTION>
------------------
Dollar Amounts in Thousands Year-to-date
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<S> <C> <C> <C> <C> <C>
1. Interest income (continued) RIAD Bil Mil Thou
f. Interest income on federal funds sold and securities purchased under
agreements to resell in domestic offices of the bank and of its Edge
and Agreement subsidiaries, and in IBFs.................................. 4020 1,743 1.f.
g. Total interest income (sum of items 1.a through 1.f)..................... 4107 272,598 1.g.
2. Interest expense:
a. Interest on deposits:
(1) Interest on deposits in domestic offices:
(a) Transaction accounts (NOW accounts, ATS accounts, and telephone
and preauthorized transfer accounts)........................... 4508 7,236 2.a.(1)(a)
(b) Nontransaction accounts:
(1) Money market deposit accounts (MMDAs)...................... 4509 37,455 2.a.(1)(b)(1)
(2) Other savings deposits..................................... 4511 3,994 2.a.(1)(b)(2)
(3) Time certificates of deposit of $100,000 or more........... 4174 13,001 2.a.(1)(b)(3)
(4) All other time deposits.................................... 4512 34,018 2.a.(1)(b)(4)
(2) Interest on deposits in foreign offices, Edge and Agreement
subsidiaries, and IBFs............................................. 4172 1,917 2.a.(2)
b. Expense of federal funds purchased and securities sold under
agreements to repurchase in domestic offices of the bank and of its
Edge and Agreement subsidiaries, and in IBFs........................... 4180 22,354 2.b.
c. Interest on demand notes issued to the U.S. Treasury, trading
liabilities, and other borrowed money.................................. 4185 10,014 2.c.
d. Interest on mortgage indebtedness and obligations under
capitalized leases..................................................... 4072 42 2.d.
e. Interest on subordinated notes and debentures.......................... 4200 0 2.e.
f. Total interest expense (sum of items 2.a through 2.e).................. 4073 130,031 2.f.
3. Net interest income (item 1.g minus 2.f).................................... RIAD 4074 142,567 3.
4. Provisions:
a. Provision for loan and lease losses.................................... RIAD 4230 0 4.a.
b. Provision for allocated transfer risk.................................. RIAD 4243 0 4.b.
5. Noninterest income:
a. Income from fiduciary activities....................................... 4070 0 5.a.
b. Service charges on deposit accounts in domestic offices................ 4080 22,099 5.b.
c. Trading gains (losses) and fees from foreign exchange transactions..... 4075 374 5.c.
d. Other foreign transaction gains (losses)............................... 4076 122 5.d.
e. Other gains (losses) and fees from trading assets and liabilities...... 4077 418 5.e.
f. Other noninterest income:
(1) Other fee income................................................... 5407 17,284 5.f.(1)
(2) All other noninterest income*...................................... 5408 6,464 5.f.(2)
g. Total noninterest income (sum of items 5.a through 5.f)................ RIAD 4079 46,761 5.g.
6. a. Realized gains (losses) on held-to-maturity securities................. RIAD 3521 (675) 6.a.
b. Realized gains (losses) on available-for-sale securities............... RIAD 3196 1,029 6.b.
7. Noninterest expense:
a. Salaries and employee benefits......................................... 4135 64,468 7.a.
b. Expenses of premises and fixed assets (net of rental income)
(excluding salaries and employee benefits and mortgage interest)....... 4217 17,052 7.b.
c. Other noninterest expense*............................................. 4092 34,706 7.c.
d. Total noninterest expense (sum of items 7.a through 7.c)............... RIAD 4093 116,226 7.d.
8. Income (loss) before income taxes and extraordinary items and other
adjustments (item 3 plus or minus items 4.a, 4.b, 5.g, 6.a, 6.b, and 7.d)... RIAD 4301 73,456 8.
9. Applicable income taxes (on item 8)......................................... RIAD 4302 26,922 9.
10. Income (loss) before extraordinary items and other adjustments
(item 8 minus 9)............................................................ RIAD 4300 46,534 10.
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</TABLE>
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*Describe on Schedule RI-E--Explanations.
4
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Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-3
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI--CONTINUED
<TABLE>
<CAPTION>
------------
Year-to-date
--------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
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11. Extraordinary items and other adjustments:
a. Extraordinary items and other adjustments,
gross of income taxes*.................................. 4310 0 11.a.
b. Applicable income taxes (on item 11.a)*.................. 4315 0 11.b.
c. Extraordinary items and other adjustments, net of income ------------------
taxes (item 11.a minus 11.b)............................. RIAD 4320 0 11.c.
12. Net income (loss) (sum of items 10 and 11.c).................. RIAD 4340 46,534 12.
-------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
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I481 <-
------------
Memoranda Year-to-date
----------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
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<S> <C> <C> <C>
1. Interest expense incurred to carry tax-exempt securities, loans, and leases
acquired after August 7, 1986, that is not deductible for federal income
tax purposes.................................................................... 4513 237 M.1.
2. Income from the sale and servicing of mutual funds and annuities in domestic
offices (included in Schedule RI, item 8)....................................... 8431 2,866 M.2.
3. Estimated foreign tax credit included in applicable income taxes, items 9
and 11.b above.................................................................. 4309 0 M.3.
4. To be completed only by banks with $1 billion or more in total assets:
Taxable equivalent adjustment to "Income (loss) before income taxes and
extraordinary items and other adjustments" (item 8 above)....................... 1244 1,514 M.4.
5. Number of full-time equivalent employees on payroll at end of current Number
period (round to nearest whole number).......................................... 4150 3,115 M.5.
6. Not applicable
7. If the reporting bank has restated its balance sheet as a result of applying
push down accounting this calendar year, report the date of the bank's MM DD YY
acquisition..................................................................... 9106 00/00/00 M.7.
8. Trading revenue (from cash instruments and off-balance sheet derivative
instruments) (included in Schedule RI, items 5.c and 5.e): Bil Mil Thou
a. Interest rate exposures...................................................... 8757 47 M.8.a.
b. Foreign exchange exposures................................................... 8758 374 M.8.b.
c. Equity security and index exposures.......................................... 8759 0 M.8.c.
d. Commodity and other exposures................................................ 8760 0 M.8.d.
9. Impact on income of off-balance sheet derivatives held for purposes other than
trading:
a. Net increase (decrease) to interest income................................... 8761 1,303 M.9.a.
b. Net (increase) decrease to interest expense.................................. 8762 1,147 M.9.b.
c. Other (noninterest) allocations.............................................. 8763 0 M.9.c.
----------------------
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*Describe on Schedule RI-E--Explanations.
5
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Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-4
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI-A--CHANGES IN EQUITY CAPITAL
Indicate decreases and losses in parentheses.
<TABLE>
<CAPTION>
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I483 <-
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Dollar Amounts in Thousands RIAD Bil Mil Thou
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<S> <C> <C> <C>
1. Total equity capital originally reported in the December 31, 1994, Reports of
Condition and Income.............................................................. 3215 554,886 1.
2. Equity capital adjustments from amended Reports of Income, net*................... 3216 0 2.
3. Amended balance end of previous calendar year (sum of items 1 and 2).............. 3217 554,886 3.
4. Net income (loss) (must equal Schedule RI, item 12)............................... 4340 46,534 4.
5. Sale, conversion, acquisition, or retirement of capital stock, net................ 4346 0 5.
6. Changes incident to business combinations, net.................................. 4356 0 6.
7. LESS: Cash dividends declared on preferred stock.................................. 4470 0 7.
8. LESS: Cash dividends declared on common stock..................................... 4460 12,204 8.
9. Cumulative effect of changes in accounting principles from prior years* (see
instructions for this schedule)................................................... 4411 0 9.
10. Corrections of material accounting errors from prior years* (see instructions
for this schedule)................................................................ 4412 0 10.
11. Change in net unrealized holding gains (losses) on available-for-sale
securities........................................................................ 8433 12,812 11.
12. Foreign currency translation adjustments.......................................... 4414 0 12.
13. Other transactions with parent holding company* (not included in items 5, 7, or
8 above).......................................................................... 4415 0 13.
14. Total equity capital end of current period (sum of items 3 through 13) (must
equal Schedule RC, item 28)....................................................... 3210 602,028 14.
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* Describe on Schedule RI-E -- Explanations.
SCHEDULE RI-B -- CHARGE-OFFS AND RECOVERIES AND CHANGES IN ALLOWANCE FOR LOAN
AND LEASE LOSSES
PART I. CHARGE-OFFS AND RECOVERIES ON LOANS AND LEASES
Part I excludes charge-offs and recoveries through
the allocated transfer risk reserve.
<TABLE>
<CAPTION>
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I486 <-
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(Column A) (Column B)
Charge-offs Recoveries
--------------------------------------
Calendar year-to-date
--------------------------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou RIAD Bil Mil Thou
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<S> <C> <C> <C> <C> <C>
1. Loans secured by real estate:
a. To U.S. addressees (domicile).................................... 4651 419 4661 1,097 1.a.
b. To non-U.S. addressees (domicile)................................ 4652 0 4662 0 1.b.
2. Loans to depository institutions and acceptances of other banks:
a. To U.S. banks and other U.S. depository institutions............. 4653 0 4663 0 2.a.
b. To foreign banks................................................. 4654 0 4664 0 2.b.
3. Loans to finance agricultural production and other loans to
farmers............................................................. 4655 0 4665 24 3.
4. Commercial and industrial loans:
a. To U.S. addressees (domicile).................................... 4645 646 4617 1,554 4.a.
b. To non-U.S. addressees (domicile)................................ 4646 0 4618 0 4.b.
5. Loans to individuals for household, family, and other personal
expenditures:
a. Credit cards and related plans................................... 4656 760 4666 198 5.a.
b. Other (includes single payment, installment, and all student
loans)........................................................... 4657 5,259 4667 3,639 5.b.
6. Loans to foreign governments and official institutions.............. 4643 0 4627 0 6.
7. All other loans..................................................... 4644 385 4628 349 7.
8. Lease financing receivables:
a. Of U.S. addressees (domicile).................................... 4658 0 4668 18 8.a.
b. Of non-U.S. addressees (domicile)................................ 4659 0 4669 0 8.b.
9. Total (sum of items 1 through 8).................................... 4635 7,479 4605 6,924 9.
--------------------------------------
</TABLE>
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Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-5
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI-B--CONTINUED
PART I. CONTINUED
Memoranda
<TABLE>
<CAPTION>
------------------------------------
(Column A) (Column B)
Charge-offs Recoveries
------------------------------------
Calendar year-to-date
------------------------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou RIAD Bil Mil Thou
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<S> <C> <C> <C> <C> <C>
1-3. Not applicable.
4. Loans to finance commercial real estate, construction, and land
development activities (not secured by real estate) included in
Schedule RI-B, part I, items 4 and 7, above....................... 5409 0 5410 59 M.4.
5. Loans secured by real estate in domestic offices (included in
Schedule RI-B, part 1, item 1, above):
a. Construction and land development................................ 3582 124 3583 32 M.5.a.
b. Secured by farmland.............................................. 3584 2 3585 112 M.5.b.
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4 family residential
properties and extended under lines of credit................ 5411 33 5412 55 M.5.c.(1)
(2) All other loans secured by 1-4 family residential
properties................................................... 5413 156 5414 592 M.5.c.(2)
d. Secured by multifamily (5 or more) residential properties........ 3588 0 3589 0 M.5.d.
e. Secured by nonfarm nonresidential properties..................... 3590 104 3591 306 M.5.e.
------------------------------------
</TABLE>
PART II. CHANGES IN ALLOWANCE FOR LOAN AND LEASE LOSSES
<TABLE>
<CAPTION>
-----------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Balance originally reported in the December 31, 1994, Reports of Condition and Income........ 3124 125,911 1.
2. Recoveries (must equal part I, item 9, column B above)....................................... 4605 6,924 2.
3. LESS: Charge-offs (must equal part I, item 9, column A above)................................ 4635 7,479 3.
4. Provision for loan and lease losses (must equal Schedule RI, item 4.a)....................... 4230 0 4.
5. Adjustments * (see instructions for this schedule)........................................... 4815 0 5.
6. Balance end of current period (sum of items 1 through 5) (must equal Schedule RC,
item 4.b).................................................................................. 3123 125,356 6.
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</TABLE>
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Describe on Schedule RI-E -- Explanations.
SCHEDULE RI-C -- APPLICABLE INCOME TAXES BY TAXING AUTHORITY
<TABLE>
<CAPTION>
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Schedule RI-C is to be reported with the December Report of Income. I489 <-
-----------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
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<S> <C> <C> <C> <C> <C>
1. Federal...................................................................................... 4780 N/A 1.
2. State and local.............................................................................. 4790 N/A 2.
3. Foreign...................................................................................... 4795 N/A 3.
4. Total (sum of items 1 through 3) (must equal sum of Schedule RI, items 9 and 11.b)........... 4770 N/A 4.
-----------------
5. Deferred portion of item 4................................................. RIAD 4772 N/A 5.
------------------------------------
</TABLE>
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Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-6
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI-D--INCOME FROM INTERNATIONAL OPERATIONS
For all banks with foreign offices, Edge or Agreement subsidiaries, or IBFs
where international operations account for more than 10 percent of total
revenues, total assets, or net income.
PART I. ESTIMATED INCOME FROM INTERNATIONAL OPERATIONS
<TABLE>
<CAPTION>
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I492 <-
------------
Year-to-date
-------------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Interest income and expense booked at foreign offices, Edge and Agreement
subsidiaries, and IBFs:
a. Interest income booked .................................................................... 4837 N/A 1.a.
b. Interest expense booked ................................................................... 4838 N/A 1.b.
c. Net interest income booked at foreign offices, Edge and Agreement subsidiaries,
and IBFs (item 1.a minus 1.b) ............................................................. 4839 N/A 1.c.
2. Adjustments for booking location of international operations:
a. Net interest income attributable to international operations booked at domestic offices ... 4840 N/A 2.a.
b. Net interest income attributable to domestic business booked at foreign offices ........... 4841 N/A 2.b.
c. Net booking location adjustment (item 2.a minus 2.b) ...................................... 4842 N/A 2.c.
3. Noninterest income and expense attributable to international operations:
a. Noninterest income attributable to international operations ............................... 4097 N/A 3.a.
b. Provision for loan and lease losses attributable to international operations .............. 4235 N/A 3.b.
c. Other noninterest expense attributable to international operations ........................ 4239 N/A 3.c.
d. Net noninterest income (expense) attributable to international operations (item 3.a minus
3.b and 3.c)............................................................................... 4843 N/A 3.d.
4. Estimated pretax income attributable to international operations before capital allocation
adjustment (sum of items 1.c, 2.c, and 3.d) .................................................. 4844 N/A 4.
5. Adjustment to pretax income for internal allocations to international operations to reflect
the effects of equity capital on overall bank funding costs .................................. 4845 N/A 5.
6. Estimated pretax income attributable to international operations after capital allocation
adjustment (sum of items 4 and 5) ............................................................ 4846 N/A 6.
7. Income taxes attributable to income from international operations as estimated in item 6 ..... 4797 N/A 7.
8. Estimated net income attributable to international operations (item 6 minus 7) ............... 4341 N/A 8.
-------------------------
</TABLE>
Memoranda
<TABLE>
<CAPTION>
-------------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Intracompany interest income included in item 1.a above ...................................... 4847 N/A M.1.
2. Intracompany interest expense included in item 1.b above ..................................... 4848 N/A M.2.
-------------------------
</TABLE>
PART II. SUPPLEMENTARY DETAILS ON INCOME FROM INTERNATIONAL OPERATIONS REQUIRED
BY THE DEPARTMENTS OF COMMERCE AND TREASURY FOR PURPOSES OF THE U.S.
INTERNATIONAL ACCOUNTS AND THE U.S. NATIONAL INCOME AND PRODUCT ACCOUNTS
<TABLE>
<CAPTION>
------------
Year-to-date
-------------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Interest income booked at IBFs ............................................................... 4849 N/A 1.
2. Interest expense booked at IBFs............................................................... 4850 N/A 2.
3. Noninterest income attributable to international operations booked at domestic offices
(excluding IBFs):
a. Gains (losses) and extraordinary items .................................................... 5491 N/A 3.a.
b. Fees and other noninterest income ......................................................... 5492 N/A 3.b.
4. Provision for loan and lease losses attributable to international operations booked at
domestic offices (excluding IBFs) ............................................................ 4852 N/A 4.
5. Other noninterest expense attributable to international operations booked at domestic
offices (excluding IBFs) ..................................................................... 4853 N/A 5.
-------------------------
</TABLE>
8
<PAGE> 41
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-7
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI-E--EXPLANATIONS
Schedule RI-E is to be completed each quarter on a calendar year-to-date basis.
Detail all adjustments in Schedule RI-A and RI-B, all extraordinary items and
other adjustments in Schedule RI, and all significant items of other noninterest
income and other noninterest expense in Schedule RI. (See instructions for
details.)
<TABLE>
<CAPTION>
--------
I495 <-
------------
Year-to-date
-----------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. All other noninterest income (from Schedule RI, item 5.f.(2))
Report amounts that exceed 10% of Schedule RI, item 5.f.(2):
a. Net gains on other real estate owned............................................ 5415 3,278 1.a.
b. Net gains on sales of loans..................................................... 5416 0 1.b.
c. Net gains on sales of premises and fixed assets................................. 5417 0 1.c.
Itemize and describe the three largest other amounts that exceed 10% of Schedule
RI, item 5.f.(2):
d. TEXT 4461: Rebate official checks-AMEX.......................................... 4461 1,013 1.d.
e. TEXT 4462: Vendor incentives.................................................... 4462 859 1.e.
f. TEXT 4463: ..................................................................... 4463 1.f.
2. Other noninterest expense (from Schedule RI, item 7.c):
a. Amortization expense of intangible assets....................................... 4531 1,319 2.a.
Report amounts that exceed 10% of Schedule RI, item 7.c:
b. Net losses on other real estate owned........................................... 5418 0 2.b.
c. Net losses on sales of loans.................................................... 5419 0 2.c.
d. Net losses on sales of premises and fixed assets................................ 5420 0 2.d.
Itemize and describe the three largest other amounts that exceed 10% of Schedule
RI, item 7.c:
e. TEXT 4464: Systems & processing expense......................................... 4464 5,069 2.e.
f. TEXT 4467: FDIC assessments..................................................... 4467 6,162 2.f.
g. TEXT 4468: ..................................................................... 4468 2.g.
3. Extraordinary items and other adjustments (from Schedule RI, item 11.a) and
applicable income tax effect (from Schedule RI, item 11.b) (itemize and describe
all extraordinary items and other adjustments):
a. (1) TEXT 4469: .................................................................. 4469 3.a.(1)
(2) Applicable income tax effect..................... RIAD 4486 3.a.(2)
b. (1) TEXT 4487: .................................................................. 4487 3.b.(1)
(2) Applicable income tax effect..................... RIAD 4488 3.b.(2)
c. (1) TEXT 4489: .................................................................. 4489 3.c.(1)
(2) Applicable income tax effect..................... RIAD 4491 3.c.(2)
4. Equity capital adjustments from amended Reports of Income (from Schedule RI-A,
item 2) (itemize and describe all adjustments):
a. TEXT 4492: ..................................................................... 4492 4.a.
b. TEXT 4493: ..................................................................... 4493 4.b.
5. Cumulative effect of changes in accounting principles from prior years (from
Schedule RI-A, item 9) (itemize and describe all changes in accounting principles):
a. TEXT 4494: ..................................................................... 4494 5.a.
b. TEXT 4495: ..................................................................... 4495 5.b.
6. Corrections of material accounting errors from prior years (from Schedule RI-A,
item 10) (itemize and describe all corrections):
a. TEXT 4496: ..................................................................... 4496 6.a.
b. TEXT 4497: ..................................................................... 4497 6.b.
-----------------
</TABLE>
9
<PAGE> 42
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RI-8
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RI-E--CONTINUED
<TABLE>
<CAPTION>
---------------
Year-to-date
-------------------
Dollar Amounts in Thousands RIAD Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
7. Other transactions with parent holding company (from Schedule RI-A, item 13)
(itemize and describe all such transactions):
a. TEXT 4498: ....................................................................... 4498 7.a.
b. TEXT 4499: ....................................................................... 4499 7.b.
8. Adjustments to allowance for loan and lease losses (from Schedule RI-B, part
II, item 5) (itemize and describe all adjustments):
a. TEXT 4521: ....................................................................... 4521 8.a.
b. TEXT 4522: ....................................................................... 4522 8.b.
-------------------
I498 I499 <-
-------------------
9. Other explanations (the space below is provided for the bank to briefly
describe, at its option, any other significant items affecting the Report of
Income):
No comment: /X/ (RIAD 4769)
Other explanations (please type or print clearly):
(TEXT 4769)
</TABLE>
10
<PAGE> 43
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-1
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
CONSOLIDATED REPORT OF CONDITION FOR INSURED
COMMERCIAL AND STATE-CHARTERED SAVINGS BANKS FOR JUNE 30, 1995
All schedules are to be reported in thousands of dollars. Unless otherwise
indicated, report the amount outstanding as of the last business day of the
quarter.
SCHEDULE RC--BALANCE SHEET
<TABLE>
<CAPTION>
-------
C400 <-
------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
1. Cash and balances due from depository institutions (from Schedule RC-A):
a. Noninterest-bearing balances and currency and coin(1)................................. 0081 410,613 1.a.
b. Interest bearing balances(2).......................................................... 0071 26,272 1.b.
2. Securities:
a. Held-to-maturity securities (from Schedule RC-B, column A)............................ 1754 1,440,650 2.a.
b. Available-for-sale securities (from Schedule RC-B, column D).......................... 1773 500,815 2.b.
3. Federal funds sold and securiites purchased under agreements to resell in domestic offices
of the bank and of its Edge and Agreement subsidiaries, and in IBFs:
a. Federal funds sold.................................................................... 0276 71,590 3.a.
b. Securities purchased under agreements to resell....................................... 0277 12,215 3.b.
4. Loans and lease financing receivables:
a. Loans and leases, net of unearned income (from Schedule RC-C)... RCFD 2122 5,111,986 4.a.
b. LESS: Allowance for loan and lease losses....................... RCFD 3123 125,356 4.b.
c. LESS: Allocated transfer risk reserve........................... RCFD 3128 0 4.c.
d. Loans and leases, net of unearned income, allowance, and reserve (item 4.a minus 4.b
and 4.c).............................................................................. 2125 4,986,630 4.d.
5. Trading assets (from Schedule RC-D)........................................................ 3545 29,224 5.
6. Premises and fixed assets (including capitalized leases)................................... 2145 107,121 6.
7. Other real estate owned (from Schedule RC-M)............................................... 2150 9,389 7.
8. Investments in unconsolidated subsidiaries and associated companies (from Schedule RC-M)... 2130 0 8.
9. Customers' liability to this bank on acceptances outstanding............................... 2155 22,055 9.
10. Intangible assets (from Schedule RC-M)..................................................... 2143 17,365 10.
11. Other assets (from Schedule RC-F).......................................................... 2160 169,311 11.
12. Total assets (sum of items 1 through 11)................................................... 2170 7,803,250 12.
------------------
</TABLE>
- ---------------
(1) Includes cash items in process of collection and unposted debits.
(2) Includes time certificates of deposit not held for trading.
11
<PAGE> 44
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-2
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC--CONTINUED
<TABLE>
<CAPTION>
-----------------------
Dollar Amounts in Thousands Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
LIABILITIES
13. Deposits:
a. In domestic offices (sum of totals of columns A and C from
Schedule RC-E, part I)....................................................... RCON 2200 5,868,754 13.a.
(1) Noninterest-bearing(1).......................... RCON 6631 1,113,291 13.a.(1)
(2) Interest-bearing................................ RCON 6636 4,755,463 13.a.(2)
b. In foreign offices, Edge and Agreement subsidiaries, and IBFs
from Schedule RC-E, part II)................................................ RCFN 2200 106,047 13.b.
(1) Noninterest-bearing............................. RCFN 6631 0 13.b.(1)
(2) Interest-bearing................................ RCFN 6636 106,047 13.b.(2)
14. Federal funds purchased and securities sold under agreements to repurchase
in domestic offices of the bank and of its Edge and Agreement subsidiaries,
and in IBFs:
a. Federal funds purchased..................................................... RCFD 0278 173,647 14.a.
b. Securities sold under agreements to repurchase.............................. RCFD 0279 512,849 14.b.
15. a. Demand notes issued to the U.S. Treasury.................................... RCON 2840 149,963 15.a.
b. Trading liabilities (from Schedule RC-D).................................... RCFD 3548 13,826 15.b.
16. Other borrowed money:
a. With original maturity of one year or less.................................. RCFD 2332 25,369 16.a.
b. With original maturity of more than one year................................ RCFD 2333 200,000 16.b.
17. Mortgage indebtedness and obligations under capitalized leases................. RCFD 2910 1,197 17.
18. Bank's liability on acceptances executed and outstanding....................... RCFD 2920 22,055 18.
19. Subordinated notes and debentures.............................................. RCFD 3200 0 19.
20. Other liabilities (from Schedule RC-G)......................................... RCFD 2930 127,515 20.
21. Total liabilities (sum of items 13 through 20)................................. RCFD 2948 7,201,222 21.
22. Limited-life preferred stock and related surplus............................... RCFD 3282 0 22.
EQUITY CAPITAL
23. Perpetual preferred stock and related surplus.................................. RCFD 3838 0 23.
24. Common stock................................................................... RCFD 3230 75,000 24.
25. Surplus (exclude all surplus related to preferred stock)....................... RCFD 3839 101,476 25.
26. a. Undivided profits and capital reserves...................................... RCFD 3632 426,037 26.a.
b. Net unrealized holding gains (losses) on available-for-sale securities...... RCFD 8434 (485) 26.b.
27. Cumulative foreign currency translation adjustments............................ RCFD 3284 0 27.
28. Total equity capital (sum of items 23 through 27).............................. RCFD 3210 602,028 28.
29. Total liabilities, limited-life preferred stock, and equity capital (sum of
items 21, 22 and 28)........................................................... RCFD 3300 7,803,250 29.
-----------------------
MEMORANDUM
To be reported only with the March Report of Condition.
1. Indicate in the box at the right the number of the statement below that best Number
describes the most comprehensive level of auditing work performed for the bank -----------------------
by independent external auditors as of any date during 1994..................... RCFD 6724 N/A M.1.
-----------------------
1 = Independent audit of the bank conducted in accordance with generally accepted auditing standards by a certified
public accounting firm which submits a report on the bank
2 = Independent audit of the bank's parent holding company conducted in accordance with generally accepted auditing
standards by a certified public accounting firm which submits a report on the consolidated holding company (but
not on the bank separately)
3 = Directors' examination of the bank conducted in accordance with generally accepted auditing standards by a
certified public accounting firm (may be required by state chartering authority)
4 = Directors' examination of the bank performed by other external auditors (may be required by state chartering
authority)
5 = Review of the bank's financial statements by external auditors
6 = Compilation of the bank's financial statements by external auditors
7 = Other audit procedures (excluding tax preparation work)
8 = No external audit work
</TABLE>
- ---------------
(1) Includes total demand deposits and noninterest-bearing time and savings
deposits.
12
<PAGE> 45
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-3
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-A--CASH AND BALANCES DUE FROM DEPOSITORY INSTITUTIONS
Exclude assets held for trading.
<TABLE>
<CAPTION>
-------
C405 <-
-------------------------------------------
(Column A) (Column B)
Consolidated Domestic
Bank Offices
-------------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCON Bil Mil Thou
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Cash items in process of collection, unposted debits, and
currency and coin.................................................... 0022 396,120 1.
a. Cash items in process of collection and unposted debits........... 0020 293,102 1.a.
b. Currency and coin................................................. 0080 103,018 1.b.
2. Balances due from depository institutions in the U.S................. 0082 6,533 2.
a. U.S. branches and agencies of foreign banks
(including their IBFs)............................................ 0083 0 2.a.
b. Other commercial banks in the U.S. and other depository
institutions in the U.S (including their IBFs).................... 0085 6,533 2.b.
3. Balances due from banks in foreign countries and foreign central
banks................................................................ 0070 1,237 3.
a. Foreign branches of other U.S. banks.............................. 0073 25,526 3.a.
b. Other banks in foreign countries and foreign central banks........ 0074 1,422 3.b.
4. Balances due from Federal Reserve Banks.............................. 0090 7,284 0090 7,284 4.
5. Total (sum of items 1 through 4) (total of column A must equal
Schedule RC, sum of items 1.a and 1.b)............................... 0010 436,885 0010 411,174 5.
-------------------------------------------
</TABLE>
<TABLE>
------------------
Memorandum Dollar Amounts in Thousands RCON Bil Mil Thou
- ---------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Noninterest-bearing balances due from commercial banks in the U.S. (included in item
2, column B above)............................................................................ 0050 5,971 M.1
------------------
</TABLE>
SCHEDULE RC-B--SECURITIES
Exclude assets held for trading.
<TABLE>
<CAPTION>
--------
C410 <-
-----------------------------------------------------------------------------
Held-to-maturity Available-for-sale
-----------------------------------------------------------------------------
(Column A) (Column B) (Column C) (Column D)
Amortized Cost Fair Value Amortized Cost Fair Value(1)
-----------------------------------------------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1. U.S. Treasury securities.......... 0211 125,039 0213 123,902 1286 133,336 1287 134,555 1.
2. U.S. Government agency and
corporation obligations (exclude
mortgage-backed securities):
a. Issued by U.S. Government
agencies(2).................... 1289 0 1290 0 1291 0 1293 0 2.a.
b. Issued by U.S. Government-
sponsored agencies(3).......... 1294 90,118 1295 88,902 1297 0 1298 0 2.b.
-----------------------------------------------------------------------------
</TABLE>
- ---------------
(1) Includes equity securities without readily determinable fair values at
historical cost in item 6.c, column D.
(2) Includes Small Business Administration "Guaranteed Loan Pool Certificates,"
U.S. Maritime Administration obligations, and Export-Import Bank
participation certificates.
(3) Includes obligations (other than mortgage-backed securities) issued by the
Farm Credit System, the Federal Home Loan Bank System, the Federal Home Loan
Mortgage Corporation, the Federal National Mortgage Association, the
Financing Corporation, Resolution Funding Corporation, the Student Loan
Marketing Association, and the Tennessee Valley Authority.
13
<PAGE> 46
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-4
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-B--CONTINUED
<TABLE>
<CAPTION>
-------------------------------------
Held-to-maturity
-------------------------------------
(Column A) (Column B)
Amortized Cost Fair Value
-------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCFD Bil Mil Thou
- ----------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
3. Securities issued by states and political
subdivisions in the U.S.:
a. General obligations............................. 1676 6,885 1677 6,886
b. Revenue obligations............................. 1681 2,000 1686 1,956
c. Industrial development and similar obligations.. 1694 0 1695 0
4. Mortgage-backed securities (MBS):
a. Pass-through securities:
(1) Guaranteed by GNMA.......................... 1698 117,400 1699 118,401
(2) Issued by FNMA and FHLMC.................... 1703 0 1705 0
(3) Other pass-through securities............... 1709 0 1710 0
b. Other mortgage-backed securities (include CMOs,
REMICs, and stripped MBS):
(1) Issued or guaranteed by FNMA,
FHLMC, or GNMA.............................. 1714 892,896 1715 898,053
(2) Collateralized by MBS issued or guaranteed by
FNMA, FHLMC, or GNMA........................ 1718 2,726 1719 2,824
(3) All other mortgage-backed securities........ 1733 201,536 1734 198,261
5. Other debt securities:
a. Other domestic debt securities.................. 1737 1,025 1738 1,050
b. Foreign debt securities......................... 1742 1,025 1743 1,025
6. Equity securities:
a. Investments in mutual funds.....................
b. Other equity securities with readily determinable
fair values.....................................
c. All other equity securities(1)..................
7. Total (sum of items 1 through 6)(total of column A
must equal Schedule RC, item 2.a) (total of column D
must equal Schedule RC, item 2.b).................. 1754 1,440,650 1771 1,441,260
-------------------------------------
<CAPTION>
------------------------------------
Available-for-sale
------------------------------------
(Column C) (Column D)
Amortized Cost Fair Value(1)
------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCFD Bil Mil Thou
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
3. Securities issued by states and political
subdivisions in the U.S.:
a. General obligations............................. 1678 0 1679 0 3.a.
b. Revenue obligations............................. 1690 0 1691 0 3.b.
c. Industrial development and similar obligations.. 1696 0 1697 0 3.c.
4. Mortgage-backed securities (MBS):
a. Pass-through securities:
(1) Guaranteed by GNMA.......................... 1701 0 1702 0 4.a.(1)
(2) Issued by FNMA and FHLMC.................... 1706 0 1707 0 4.a.(2)
(3) Other pass-through securities............... 1711 0 1713 0 4.a.(3)
b. Other mortgage-backed securities (include CMOs,
REMICs, and stripped MBS):
(1) Issued or guaranteed by FNMA,
FHLMC, or GNMA.............................. 1716 276,331 1717 274,213 4.b.(1)
(2) Collateralized by MBS issued or guaranteed by
FNMA, FHLMC, or GNMA........................ 1731 0 1732 0 4.b.(2)
(3) All other mortgage-backed securities........ 1735 62,555 1736 63,154 4.b.(3)
5. Other debt securities:
a. Other domestic debt securities.................. 1739 0 1741 0 5.a.
b. Foreign debt securities......................... 1744 0 1746 0 5.b.
6. Equity securities:
a. Investments in mutual funds..................... 1747 0 1748 0 6.a.
b. Other equity securities with readily determinable
fair values..................................... 1749 58 1751 58 6.b.
c. All other equity securities(1).................. 1752 28,835 1753 28,835 6.c.
7. Total (sum of items 1 through 6)(total of column A
must equal Schedule RC, item 2.a) (total of column D
must equal Schedule RC, item 2.b).................. 1772 501,115 1773 500,815 7.
------------------------------------
</TABLE>
- -----------------
(1) Includes equity securities without readily determinable fair values at
historical cost in item 6.c, column D.
14
<PAGE> 47
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-5
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-B--CONTINUED
<TABLE>
<CAPTION>
-------
Memoranda C412 <-
-------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Pledged securities(2)........................................................... 0416 1,501,923 M.1.
2. Maturity and repricing data for debt securities (2)(3)(4) (excluding those in
nonaccrual status):
a. Fixed rate debt securities with a remaining maturity of:
(1) Three months or less................................................... 0343 49,256 M.2.a.(1)
(2) Over three months through 12 months.................................... 0344 136,398 M.2.a.(2)
(3) Over one year through five years....................................... 0345 81,639 M.2.a.(3)
(4) Over five years........................................................ 0346 1,321,645 M.2.a.(4)
(5) Total fixed rate debt securities (sum of Memorandum items 2.a.(1)
through 2.a.(4))....................................................... 0347 1,588,938 M.2.a.(5)
b. Floating rate debt securities with a repricing frequency of:
(1) Quarterly or more frequently........................................... 4544 205,209 M.2.b.(1)
(2) Annually or more frequently, but less frequently than quarterly........ 4545 0 M.2.b.(2)
(3) Every five years or more frequently, but less frequently than
annually............................................................... 4551 118,425 M.2.b.(3)
(4) Less frequently than every five years.................................. 4552 0 M.2.b.(4)
(5) Total floating rate debt securities (sum of Memorandum items 2.b.(1)
through 2.b.(4))....................................................... 4553 323,634 M.2.b.(5)
c. Total debt securities (sum of Memorandum items 2.a.(5) and 2.b.(5)) (must
equal total debt securities from Schedule RC-B, sum of items 1 through 5,
columns A and D, minus nonaccrual debt securities included in
Schedule RC-N, item 9, column C)........................................... 0393 1,912,572 M.2.c.
3. Not applicable
4. Held-to-maturity debt securities restructured and in compliance with modified
terms (included in Schedule RC-B, items 3 through 5, column A, above)........... 5365 0 M.4.
5. Not applicable
6. Floating rate debt securities with a remaining maturity of one year or less(2)
(included in Memorandum item 2.b.(5) above)..................................... 5519 0 M.6.
7. Amortized cost of held-to-maturity securities sold or transferred to
available-for-sale or trading securities during the calendar year-to-date
(report the amortized cost at date of sale or transfer)......................... 1778 0 M.7.
8. High-risk mortgage securities (included in the held-to-maturity and
available-for-sale accounts in Schedule RC-B, item 4.b):
a. Amortized cost............................................................. 8780 32,481 M.8.a.
b. Fair value................................................................. 8781 33,187 M.8.b.
9. Structured notes (included in the held-to-maturity and available-for-sale
accounts in Schedule RC-B, items 2, 3, and 5):
a. Amortized cost............................................................. 8782 90,118 M.9.a.
b. Fair value................................................................. 8783 89,799 M.9.b.
-------------------
</TABLE>
- ---------------
(2) Includes held-to-maturity securities at amortized cost and
available-for-sale securities at fair value.
(3) Exclude equity securities, e.g., investments in mutual funds, Federal
Reserve stock, common stock, and preferred stock.
(4) Memorandum item 2 is not applicable to savings banks that must complete
supplemental Schedule RC-J.
15
<PAGE> 48
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-6
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-C--LOANS AND LEASE FINANCING RECEIVABLES
PART I. LOANS AND LEASES
Do not deduct the allowance for loan and lease losses from amounts reported in
this schedule. Report total loans and leases, net of unearned income. Exclude
assets held for trading.
<TABLE>
<CAPTION>
-------
C415 <-
----------------------------------
(Column A) (Column B)
Consolidated Domestic
Bank Offices
----------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCON Bil Mil Thou
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Loans secured by real estate.................................................. 1410 2,321,367 1.
a. Construction and land development.......................................... 1415 148,686 1.a.
b. Secured by farmland (including farm residential and other improvements).... 1420 16,874 1.b.
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4 family residential properties
and extended under lines of credit..................................... 1797 113,141 1.c.(1)
(2) All other loans secured by 1-4 family residential properties:
(a) Secured by first liens............................................. 5367 1,072,076 1.c.(2)(a)
(b) Secured by junior liens............................................ 5368 50,124 1.c.(2)(b)
d. Secured by multifamily (5 or more) residential properties.................. 1460 42,247 1.d.
e. Secured by nonfarm nonresidential properties............................... 1480 878,219 1.e.
2. Loans to depository institutions:
a. To commercial banks in the U.S. ........................................... 1505 17,497 2.a.
(1) To U.S. branches and agencies of foreign banks......................... 1506 0 2.a.(1)
(2) To other commercial banks in the U.S. ................................. 1507 17,497 2.a.(2)
b. To other depository institutions in the U.S. .............................. 1517 844 1517 844 2.b.
c. To banks in foreign countries.............................................. 1510 1,613 2.c.
(1) To foreign branches of other U.S. banks................................ 1513 0 2.c.(1)
(2) To other banks in foreign countries.................................... 1516 1,613 2.c.(2)
3. Loans to finance agricultural production and other loans to farmers........... 1590 5,522 1590 5,522 3.
4. Commercial and industrial loans:
a. To U.S. addressees (domicile).............................................. 1763 1,308,940 1763 1,308,940 4.a.
b. To non-U.S. addressees (domicile).......................................... 1764 0 1764 0 4.b.
5. Acceptances of other banks:
a. Of U.S. banks.............................................................. 1756 0 1756 0 5.a.
b. Of foreign banks........................................................... 1757 0 1757 0 5.b.
6. Loans to individuals for household, family, and other personal expenditures
(i.e., consumer loans) (includes purchased paper)............................. 1975 958,604 6.
a. Credit cards and related plans (includes check credit and other revolving
credit plans).............................................................. 2008 58,582 6.a.
b. Other (includes single payment, installment, and all student loans)........ 2011 900,022 6.b.
7. Loans to foreign governments and official institutions (including foreign
central banks)................................................................ 2081 0 2081 0 7.
8. Obligations (other than securities and leases) of states and political
subdivisions in the U.S. (includes nonrated industrial development
obligations).................................................................. 2107 86,165 2107 86,165 8.
9. Other loans................................................................... 1563 234,170 9.
a. Loans for purchasing or carrying securities (secured and unsecured)........ 1545 41,959 9.a.
b. All other loans (exclude consumer loans)................................... 1564 192,211 9.b.
10. Lease financing receivables (net of unearned income).......................... 2165 177,264 10.
a. Of U.S. addressees (domicile).............................................. 2182 177,264 10.a.
b. Of non-U.S. addressees (domicile).......................................... 2183 0 10.b.
11. LESS: Any unearned income on loans reflected in items 1-9 above............... 2123 0 2123 0 11.
12. Total loans and leases, net of unearned income (sum of items 1 through 10
minus item 11) (total of column A must equal Schedule RC, item 4.a)........... 2122 5,111,986 2122 5,111,986 12.
------------------------------------
</TABLE>
16
<PAGE> 49
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-7
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-C--CONTINUED
PART I. CONTINUED
<TABLE>
<CAPTION>
------------------------------------
(Column A) (Column B)
Consolidated Domestic
Memoranda Bank Offices
------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCON Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
1. Commercial paper included in Schedule RC-C, part I, above....................... 1496 3,775 1496 3,775 M.1.
2. Loans and leases restructured and in compliance with modified terms (included in
Schedule RC-C, part I, above and not reported as past due or nonaccrual in
Schedule RC-N, Memorandum item 1):
a. Loans secured by real estate:
(1) To U.S. addressees (domicile) .......................................... 1687 0 M.2.a.(1)
(2) To non-U.S. addressees (domicile)....................................... 1689 0 M.2.a.(2)
b. All other loans and all lease financing receivables (exclude loans to
individuals for household, family, and other personal expenditures).......... 8691 0 M.2.b.
c. Commercial and industrial loans to and lease financing receivables of
non-U.S. addressees (domicile) included in Memorandum item 2.b above......... 8692 0 M.2.c.
3. Maturity and repricing data for loans and leases(1) (excluding those in
nonaccrual status):
a. Fixed rate loans and leases with a remaining maturity of:
(1) Three months or less.................................................... 0348 130,236 M.3.a.(1)
(2) Over three months through 12 months..................................... 0349 283,860 M.3.a.(2)
(3) Over one year through five years........................................ 0356 1,661,915 M.3.a.(3)
(4) Over five years......................................................... 0357 619,880 M.3.a.(4)
(5) Total fixed rate loans and leases (sum of Memorandum items 3.a.(1)
through 3.a.(4))........................................................ 0358 2,695,891 M.3.a.(5)
b. Floating rate loans with a repricing frequency of:
(1) Quarterly or more frequently............................................ 4554 1,814,685 M.3.b.(1)
(2) Annually or more frequently, but less frequently than quarterly......... 4555 230,567 M.3.b.(2)
(3) Every five years or more frequently, but less frequently than annually.. 4561 351,272 M.3.b.(3)
(4) Less frequently than every five years................................... 4564 4,526 M.3.b.(4)
(5) Total floating rate loans (sum of Memorandum items 3.b.(1)
through 3.b.(4))........................................................ 4567 2,401,050 M.3.b.(5)
c. Total loans and leases (sum of Memorandum items 3.a.(5) and 3.b.(5)) (must
equal the sum of total loans and leases, net, from Schedule RC-C, part I,
item 12, plus unearned income from Schedule RC-C, part I, item 11, minus
total nonaccrual loans and leases from Schedule RC-N, sum of items 1
through 8, column C)......................................................... 1479 5,096,941 M.3.c.
4. Loans to finance commercial real estate, construction, and land development
activities (not secured by real estate) included in Schedule RC-C, part I,
items 4 and 9, column A, page RC-6(2)........................................... 2746 12,125 M.4.
5. Loans and leases held for sale (included in Schedule RC-C, part I, above)....... 5369 66,780 M.5.
6. Adjustable rate closed-end loans secured by first liens on 1-4 family -----------------
residential properties (included in Schedule RC-C, part I, item 1.c.(2)(a), RCON Bil Mil Thou
column B, page RC-6)............................................................ -----------------
5370 538,448 M.6.
----------------------------------
</TABLE>
- ---------------
(1) Memorandum item 3 is not applicable to savings banks that must complete
supplemental Schedule RC-J.
(2) Exclude loans secured by real estate that are included in Schedule RC-C,
part I, item 1, column A.
17
<PAGE> 50
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-7a
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-C--CONTINUED
PART II. LOANS TO SMALL BUSINESSES AND SMALL FARMS
Schedule RC-C, Part II is to be reported only with the June Report of
Condition.
Report the number and amount currently outstanding as of June 30 of business
loans with "original amounts" of $1,000,000 or less and farm loans with
"original amounts" of $500,000 or less. The following guidelines should be used
to determine the "original amount" of a loan: (1) For loans drawn down under
lines of credit or loan commitments, the "original amount" of the loan is the
size of the line of credit or loan commitment when the line of credit or loan
commitment was most recently approved, extended, or renewed prior to the report
date. However, if the amount currently outstanding as of the report date
exceeds this size, the "original amount" is the amount currently outstanding on
the report date. (2) For loan participations and syndications, the "original
amount" of the loan participation or syndication is the entire amount of the
credit originated by the lead lender. (3) For all other loans, the "original
amount" is the total amount of the loan at origination or the amount currently
outstanding as of the report date, whichever is larger.
Loans to Small Businesses
<TABLE>
<S> <C> <C> <C> <C> <C>
1. Indicate in the appropriate box at the right whether all or substantially
all of the dollar volume of your bank's "Loans secured by nonfarm
nonresidential properties" in domestic offices reported in Schedule
RC-C, part I, item 1.e, column B, and all or substantially all of the
dollar volume of your bank's "Commercial and industrial loans to U.S. -------
addressees" in domestic offices reported in Schedule RC-C, part I, item 4.a, C418
column B, have original amounts of $100,000 or less. (If your bank has no -------
loans outstanding in both of these two loan categories, place an "X" in the RCON YES NO
box marked "NO" and go to item 5; otherwise, see instructions for further -------------
information.) ................................................................. 6999 X 1.
-------------
</TABLE>
If YES, complete items 2.a and 2.b below, skip items 3 and 4, and go to item 5.
If NO and your bank has loans outstanding in either loan category, skip items
2.a and 2.b, complete items 3 and 4 below, and go to item 5.
2. Report the total number of loans currently outstanding for each of the
following Schedule RC-C, part I, loan categories:
<TABLE>
<CAPTION>
---------------
Number of Loans
---------------
<S> <C> <C> <C> <C>
a. "Loans secured by nonfarm nonresidential properties" in domestic RCON
offices reported in Schedule RC-C, part I, item 1.e, column B .......... 5562 N/A 2.a
b. "Commercial and industrial loans to U.S. addressees" in domestic
offices reported in Schedule RC-C, part I, item 4.a, column B .......... 5563 N/A 2.b
---------------
</TABLE>
<TABLE>
<CAPTION> -------------------------------------
(Column A) (Column B)
Amount
Currently
Number of Loans Outstanding
--------------- ------------------
Dollar Amounts in Thousands RCON RCON Bil Mil Thou
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
3. Number and amount currently outstanding of "Loans secured by nonfarm
nonresidential properties" in domestic offices reported in Schedule RC-C,
part I, item 1.e, column B (sum of items 3.a through 3.c must be less than
or equal to Schedule RC-C, part I, item 1.e, column B):
a. With original amounts of $100,000 or less.................................. 5564 1,735 5565 104,690 3.a.
b. With original amounts of more than $100,000 through $250,000............... 5566 977 5567 141,559 3.b.
c. With original amounts of more than $250,000 through $1,000,000............. 5568 705 5569 283,342 3.c.
Number and amount currently outstanding of "Commercial and industrial
loans to U.S. addressees" in domestic offices reported in Schedule RC-C,
part I, item 4.a, column B (sum of items 4.a through 4.c must be less than
or equal to Schedule RC-C, part I, item 4.a, column B):
a. With original amounts of $100,000 or less.................................. 5570 9,222 5571 262,129 4.a.
b. With original amounts of more than $100,000 through $250,000............... 5572 658 5573 103,927 4.b.
c. With original amounts of more than $250,000 through $1,000,000............. 5574 666 5575 280,745 4.c.
</TABLE>
17a
<PAGE> 51
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-7b
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-C--CONTINUED
PART II. CONTINUED
Agricultural Loans to Small Farms
<TABLE>
<S> <C> <C> <C> <C> <C>
5. Indicate in the appropriate box at the right whether all or substantially
all of the dollar volume of your bank's "Loans secured by farmland
(including farm residential and other improvements)" in domestic offices
reported in Schedule RC-C, part I, item 1.b, column B, and all or
substantially all of the dollar volume of your bank's "Loans to finance
agricultural production and other loans to farmers" in domestic offices
reported in Schedule RC-C, part I, item 3, column B, have original amounts
of $100,000 or less. (If your bank has no loans outstanding in both of
these two loan categories, place an "X" in the box marked "NO" and do not YES NO
complete items 7 and 8; otherwise, see instructions for further ------------
information.).................................................................. 6860 X 5.
------------
</TABLE>
If YES, complete items 6.a and 6.b below and do not complete items 7 and 8. If
NO and your bank has loans outstanding in either loan category, skip items 6.a
and 6.b and complete items 7 and 8 below.
<TABLE>
<S> <C>
6. Report the total number of loans currently outstanding for each of the
following Schedule RC-C, part I, loan categories:
---------------
Number of Loans
---------------
RCON
----
<S> <C> <C> <C> <C>
a. "Loans secured by farmland (including farm residential and other
improvements)" in domestic offices reported in Schedule RC-C, part I,
item 1.b, column B ..................................................... 5576 N/A 6.a.
b. "Loans to finance agricultural production and other loans to
farmers" in domestic offices reported in Schedule RC-C, part I,
item 3, column B ....................................................... 5577 N/A 6.b.
---------------
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------
(Column A) (Column B)
Amount
Currently
Number of Loans Outstanding
--------------- ------------------
Dollar Amounts in Thousands RCON RCON Bil Mil Thou
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
7. Number and amount currently outstanding of "Loans secured by farmland
(including farm residential and other improvements)" in domestic offices
reported in Schedule RC-C, part I, item 1.b, column B (sum of items 7.a
through 7.c must be less than or equal to Schedule RC-C, part I, item 1.b,
column B):
a. With original amounts of $100,000 or less .................................. 5578 213 5579 5,325 7.a.
b. With original amounts of more than $100,000 through $250,000 ............... 5580 20 5581 2,558 7.b.
c. With original amounts of more than $250,000 through $500,000 ............... 5582 6 5583 1,925 7.c.
8. Number and amount currently outstanding of "Loans to finance agricultural
production and other loans to farmers" in domestic offices reported in
Schedule RC-C, part I, item 3, column B (sum of items 8.a through 8.c
must be less than or equal to Schedule RC-C, part I, item 3, column B):
a. With original amounts of $100,000 or less .................................. 5584 190 5585 4,083 8.a.
b. With original amounts of more than $100,000 through $250,000 ............... 5586 6 5587 893 8.b.
c. With original amounts of more than $250,000 through $500,000 ............... 5588 2 5589 546 8.c.
-------------------------------------
</TABLE>
17b
<PAGE> 52
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-8
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-D--TRADING ASSETS AND LIABILITIES
Schedule RC-D is to be completed only by banks with $1 billion or more in total
assets or with $2 billion or more in par/notional amount of off-balance sheet
derivative contracts (as reported in Schedule RC-L, items 14.a through 14.e,
columns A through D).
<TABLE>
<CAPTION>
------------
C420 <-
ASSETS ----------------------
Dollar Amounts in Thousands Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
1. U.S. Treasury securities in domestic offices......................................... RCON 3531 1,087 1.
2. U.S. Government agency and corporation obligations in domestic offices (exclude
mortgage-backed securities).......................................................... RCON 3532 10,271 2.
3. Securities issued by states a political subdivisions in the U.S. in domestic
offices.............................................................................. RCON 3533 2,914 3.
4. Mortgage-backed securities (MBS) in domestic offices:
a. Pass-through securities issued or guaranteed by FNMA, FHLMC, or GNMA.............. RCON 3534 1,603 4.a.
b. Other mortgage-backed securities issued or guaranteed by FNMA, FHLMC, or GNMA
(include CMOs, REMICs, and stripped MBS).......................................... RCON 3535 0 4.b.
c. All other mortgage-backed securities.............................................. RCON 3536 758 4.c.
5. Other debt securities in domestic offices............................................ RCON 3537 0 5.
6. Certificates of deposit in domestic offices.......................................... RCON 3538 0 6.
7. Commercial paper in domestic offices................................................. RCON 3539 0 7.
8. Bankers acceptances in domestic offices.............................................. RCON 3540 12,591 8.
9. Other trading assets in domestic offices............................................. RCON 3541 0 9.
10. Trading assets in foreign offices.................................................... RCFN 3542 0 10.
11. Revaluation gains on interest rate, foreign exchange rate, and other commodity and
equity contracts:
a. In domestic offices............................................................... RCON 3543 0 11.a
b. In foreign offices................................................................ RCFN 3544 0 11.b
12. Total trading assets (sum of items 1 through 11) (must equal Schedule RC, item 5).... RCFD 3545 29,224 12.
----------------------
----------------------
LIABILITIES Bil Mil Thou
----------------------
13. Liability for short positions........................................................ RCFD 3546 13,826 13.
14. Revaluation losses on interest rate, foreign exchange rate, and other commodity and
equity contracts..................................................................... RCFD 3547 0 14.
15. Total trading liabilities (sum of items 13 and 14) (must equal Schedule RC, item
15.b)................................................................................ RCFD 3548 13,826 15.
----------------------
</TABLE>
18
<PAGE> 53
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-9
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-E--DEPOSIT LIABILITIES
PART I. DEPOSITS IN DOMESTIC OFFICES
<TABLE>
<CAPTION>
-------
C425 <-
--------------------------------------------------------
Nontransaction
Transaction Accounts Accounts
--------------------------------------------------------
(Column A) (Column B) (Column C)
Total Total
transaction Memo: Total nontransaction
accounts demand deposits accounts
(including total (included in (including
demand deposits) column A) MMDAs)
--------------------------------------------------------
Dollar Amounts in Thousands RCON Bil Mil Thou RCON Bil Mil Thou RCON Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Deposits of:
1. Individuals, partnerships and corporations... 2201 1,687,965 2240 1,011,904 2346 3,662,756 1.
2. U.S. Government.............................. 2202 15,475 2280 15,475 2520 439 2.
3. States and political subdivisions in the
U.S.......................................... 2203 56,208 2290 17,891 2530 377,790 3.
4. Commercial banks in the U.S.................. 2206 52,488 2310 52,488 4.
a. U.S. branches and agencies of foreign
banks........................................ 2347 0 4.a.
b. Other commercial banks in the U.S......... 2348 0 4.b.
5. Other depository institutions in the U.S..... 2207 2,032 2312 2,032 2349 100 5.
6. Banks in foreign countries................... 2213 169 2320 169 6.
a. Foreign branches of other U.S. banks...... 2367 0 6.a.
b. Other banks in foreign countries.......... 2373 0 6.b.
7. Foreign governments and official institutions
(including foreign central banks)............ 2216 0 2300 0 2377 0 7.
8. Certified and official checks................ 2330 13,332 2330 13,332 8.
9. Total (sum of items 1 through 8) (sum of
columns A and C must equal Schedule RC, item
13.a)........................................ 2215 1,827,669 2210 1,113,291 2385 4,041,085 9.
--------------------------------------------------------
<CAPTION>
Memoranda ----------------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Selected components of total deposits (i.e., sum of item 9, columns A and C):
a. Total Individual Retirement Accounts (IRAs) and Keogh Plan accounts............. 6835 282,410 M.1.a.
b. Total brokered deposits......................................................... 2365 0 M.1.b.
c. Fully insured brokered deposits (included in Memorandum item 1.b above):
(1) Issued in denominations of less than $100,000............................... 2343 0 M.1.c.(1)
(2) Issued either in denominations of $100,000 or in denominations greater than
$100,000 and participated out by the broker in shares of $100,000 or less... 2344 0 M.1.c.(2)
d. Total deposits denominated in foreign currencies................................ 3776 0 M.1.d.
e. Preferred deposits (uninsured deposits of states and political subdivisions in
the U.S. reported in item 3 above which are secured or collateralized as
required under state law)....................................................... 5590 417,340 M.1.e
2. Components of total nontransaction accounts (sum of Memoranda items 2.a through 2.d
must equal item 9, column C, above):
a. Savings deposits:
(1) Money market deposit accounts (MMDAs)....................................... 6810 1,746,112 M.2.a.(1)
(2) Other savings deposits (excludes MMDAs)..................................... 0352 323,592 M.2.a.(2)
b. Total time deposits of less than $100,000....................................... 6648 1,325,544 M.2.b.
c. Time certificates of deposit of $100,000 or more................................ 6645 620,848 M.2.c.
d. Open-account time deposits of $100,000 or more.................................. 6646 24,989 M.2.d.
3. All NOW accounts (included in column A above)...................................... 2398 714,378 M.3.
----------------------
</TABLE>
19
<PAGE> 54
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-10
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-E--Continued
PART I. CONTINUED
Memoranda (continued)
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------
Deposit Totals for FDIC Insurance Assessments -----------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
4. Total deposits in domestic offices (sum of item 9, column A and item 9, column C)
(must equal Schedule RC, item 13.a)............................................. 2200 5,868,754 M.4.
a. Total demand deposits (must equal item 9, column B).......................... 2210 1,113,291 M.4.a.
b. Total time and savings deposits(1) (must equal item 9, column A plus item 9,
column C minus item 9, column B)............................................. 2350 4,755,463 M.4.b.
------------------
- ---------------
(1) For FDIC insurance assessment purposes, "total time and savings deposits" consists of nontransaction accounts
and all transaction accounts other than demand deposits.
- ----------------------------------------------------------------------------------------------------------------
<CAPTION>
-----------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
5. Time deposits of less than $100,000 and open-account time deposits of $100,000
or more (included in Memorandum items 2.b and 2.d above) with a remaining
maturity or repricing frequency of:(1)
a. Three months or less.......................................................... 0359 336,982 M.5.a.
b. Over three months through 12 months (but not over 12 months).................. 3644 580,329 M.5.b.
6. Maturity and repricing data for time certificates of deposit of $100,000 or
more:(1)
a. Fixed rate time certificates of deposit of $100,000 or more with a remaining
maturity of:
(1) Three months or less...................................................... 2761 164,324 M.6.a.(1)
(2) Over three months through 12 months....................................... 2762 404,039 M.6.a.(2)
(3) Over one year through five years.......................................... 2763 48,225 M.6.a.(3)
(4) Over five years........................................................... 2765 4,260 M.6.a.(4)
(5) Total fixed rate time certificates of deposit of $100,000 or more (sum of
Memorandum items 6.a.(1) through 6.a.(4))................................. 2767 620,848 M.6.a.(5)
b. Floating rate time certificates of deposit of $100,000 or more with a
repricing frequency of:
(1) Quarterly or more frequently.............................................. 4568 0 M.6.b.(1)
(2) Annually or more frequently, but less frequently than quarterly........... 4569 0 M.6.b.(2)
(3) Every five years or more frequently, but less frequently than annually.... 4571 0 M.6.b.(3)
(4) Less frequently than every five years..................................... 4572 0 M.6.b.(4)
(5) Total floating rate time certificates of deposit of $100,000 or more (sum
of Memorandum items 6.b.(1) through 6.b.(4)).............................. 4573 0 M.6.b.(5)
c. Total time certificates of deposit of $100,000 or more (sum of Memorandum
items 6.a.(5) and 6.b.(5)) (must equal Memorandum item 2.c above)............. 6645 620,848 M.6.c.
-----------------
</TABLE>
- ---------------
(1) Memorandum items 5 and 6 are not applicable to savings banks that must
complete supplemental Schedule RC-J.
20
<PAGE> 55
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-11
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-E--CONTINUED
PART II. DEPOSITS IN FOREIGN OFFICES (INCLUDING EDGE AND
AGREEMENT SUBSIDIARIES AND IBFS)
<TABLE>
<CAPTION>
----------------
Dollar Amounts in Thousands RCFN Bil Mil Thou
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Deposits of:
1. Individuals, partnerships, and corporations............................................. 2621 71,047 1.
2. U.S. banks (including IBFs and foreign branches of U.S. banks).......................... 2623 35,000 2.
3. Foreign banks (including U.S. branches and
agencies of foreign banks, including their IBFs)........................................ 2625 0 3.
4. Foreign governments and official institutions (including foreign central banks)......... 2650 0 4.
5. Certified and official checks........................................................... 2330 0 5.
6. All other deposits...................................................................... 2668 0 6.
7. Total (sum of items 1 through 6) (must equal Schedule RC, item 13.b).................... 2200 106,047 7.
-----------------
SCHEDULE RC-F--OTHER ASSETS
<CAPTION>
--------
C430 <-
--------------------
Dollar Amounts in Thousands Bil Mil Thou
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Income earned, not collected on loans.............................................. RCFD 2164 29,948 1.
2. Net deferred tax assets(1)......................................................... RCFD 2148 39,289 2.
3. Excess residential mortgage servicing fees receivable.............................. RCFD 5371 0 3.
4. Other (itemize amounts that exceed 25% of this item)............................... RCFD 2168 100,074 4.
--------- ----------------------
a. TEXT 3549 Prepaid expenses RCFD 3549 28,476 4.a
---------------------------------------------------------
b. TEXT 3550 Investment sales cig-trade date RCFD 3550 35,022 4.b
---------------------------------------------------------
c. TEXT 3551 RCFD 3551 4.c
--------------------------------------------------------------------------------
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 11)................. RCFD 2160 169,311 5.
--------------------
Memorandum
<CAPTION>
--------------------
Dollar Amounts in Thousands Bil Mil Thou
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Deferred tax assets disallowed for regulatory capital purposes..................... RCFD 5610 0 M.1
--------------------
SCHEDULE RC-G--OTHER LIABILITIES
<CAPTION>
--------
C435 <-
---------------------
Dollar Amounts in Thousands Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. a. Interest accrued and unpaid on deposits in domestic offices(2).................. RCON 3645 25,661 1.a
b. Other expenses accrued and unpaid (includes accrued income taxes payable)....... RCFD 3646 51,453 1.b
2. Net deferred tax liabilities(1).................................................... RCFD 3049 0 2.
3. Minority interest in consolidated subsidiaries..................................... RCFD 3000 0 3.
4. Other (itemize amounts that exceed 25% of this item)............................... RCFD 2938 50,401 4.
--------- ---------------------
a. TEXT 3552 Investment purchase cig-trade date RCFD 3552 37,668 4.a
----------------------------------------------------------
b. TEXT 3553 RCFD 3553 4.b
----------------------------------------------------------
c. TEXT 3554 RCFD 3554 4.c
--------------------------------------------------------------------------------
5. Total (sum of items 1 through 4) (must equal Schedule RC, item 20)................. RCFD 2930 127,515 5.
---------------------
</TABLE>
- ---------------
(1) See discussion of deferred income taxes in Glossary entry on "income taxes."
(2) For savings banks, include "dividends" accrued and unpaid on deposits.
21
<PAGE> 56
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-12
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-H--SELECTED BALANCE SHEET ITEMS FOR DOMESTIC OFFICES
<TABLE>
<CAPTION>
--------
C440 <-
------------------------
Domestic Offices
------------------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Customers' liability to this bank on acceptances outstanding ............................ 2155 22,055 1.
2. Bank's liability an acceptances executed and outstanding ................................ 2920 22,055 2.
3. Federal funds sold and securities purchased under agreements to resell .................. 1350 83,805 3.
4. Federal funds purchased and securities sold under agreements to repurchase .............. 2800 686,496 4.
5. Other borrowed money .................................................................... 3190 225,369 5.
EITHER
6. Net due from own foreign offices, Edge and Agreement subsidiaries, and IBFs ............. 2163 N/A 6.
OR
7. Net due to own foreign offices, Edge and Agreement subsidiaries, and IBFs ............... 2941 81,060 7.
8. Total assets (excludes net due from foreign offices, Edge and Agreement subsidiaries,
and IBFs) ............................................................................... 2192 7,777,527 8.
9. Total liabilities (excludes net due to foreign offices, Edge and Agreement subsidiaries,
and IBFs) ............................................................................... 3129 7,094,440 9.
------------------------
Items 10-17 include held-to-maturity and available-for-sale securities in domestic offices.
RCON Bil Mil Thou
------------------------
10. U.S. Treasury securities ................................................................ 1779 259,594 10.
11. U.S. Government agency and corporation obligations (exclude mortgage-backed securities).. 1785 90,118 11.
12. Securities issued by states and political subdivisions in the U.S. ...................... 1786 8,885 12.
13. Mortgage-backed securities (MBS):
a. Pass-through securities:
(1) Issued or guaranteed by FNMA, FHLMC, or GNMA .................................... 1787 117,400 13.a.(1)
(2) Other pass-through securities .................................................... 1869 0 13.a.(2)
b. Other mortgage-backed securities (include CMOs, REMICs, and stripped MBS):
(1) Issued or guaranteed by FNMA, FHLMC, GNMA ........................................ 1877 1,167,109 13.b.(1)
(2) All other mortgage-backed securities ............................................. 2253 267,416 13.b.(2)
14. Other domestic debt securities .......................................................... 3159 1,025 14.
15. Foreign debt securities ................................................................. 3160 1,025 15.
16. Equity securities:
a. Investments in mutual funds ......................................................... 3161 0 16.a.
b. Other equity securities with readily determinable fair values ........................ 3162 58 16.b.
c. All other equity securities .......................................................... 3169 28,835 16.c.
17. Total held-to-maturity and available-for-sale securities (sum of items 10 through 16) ... 3170 1,941,465 17.
------------------------
</TABLE>
<TABLE>
<CAPTION>
Memorandum (to be completed only by banks with IBFs and other "foreign" offices)
Dollar Amounts in Thousands RCON Bil Mil Thou
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
EITHER
1. Net due from the IBF of the domestic offices of the reporting bank ...................... 3051 N/A M.1.
OR
2. Net due to the IBF of the domestic offices of the reporting bank ......................... 3059 N/A M.2.
------------------------
</TABLE>
22
<PAGE> 57
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-13
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-I--SELECTED ASSETS AND LIABILITIES OF IBFS
To be completed only by banks with IBFs and other "foreign" offices.
<TABLE>
<CAPTION>
--------
C445 <-
------------------------
Dollar Amounts in Thousands RCFN Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Total IBF assets of the consolidated bank (component of Schedule RC, item 12)......... 2133 N/A 1.
2. Total IBF loans and lease financing receivables (component of Schedule RC-C, part I,
item 12, column A).................................................................... 2076 N/A 2.
3. IBF commercial and industrial loans (component of Schedule RC-C, part I, item 4,
column A)............................................................................. 2077 N/A 3.
Total IBF liabilities (component of Schedule RC, item 21)............................. 2898 N/A 4.
5. IBF deposit liabilities due to banks, including other IBFs (component of Schedule RC-E,
part II, items 2 and 3)............................................................... 2379 N/A 5.
6. Other IBF deposit liabilities (component of Schedule RC-E, part II, items 1, 4,
5, and 6)............................................................................. 2381 N/A 6.
------------------------
</TABLE>
SCHEDULE RC-K -- QUARTERLY AVERAGES(1)
<TABLE>
<CAPTION>
--------
C455 <-
------------------------
Dollar Amounts in Thousands Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C> <C>
1. Interest-bearing balances due from depository institutions............................ RCFD 3381 5,327 1.
2. U.S. Treasury securities and U.S. Government agency and corporation obligations(2).... RCFD 3382 1,709,499 2.
3. Securities issued by states and political subdivisions in the U.S.(2)................. RCFD 3383 8,719 3.
4. a. Other debt securities(2)......................................................... RCFD 3647 197,165 4.a.
b. Equity securities(3) (includes investments in mutual funds and Federal Reserve
stock)........................................................................... RCFD 3648 28,651 4.b.
5. Federal funds sold and securities purchased under agreements to resell in domestic
offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs........... RCFD 3365 57,686 5.
6. Loans:
a. Loans in domestic offices:
(1) Total Loans................................................................. RCON 3360 4,808,088 6.a.(1)
(2) Loans secured by real estate................................................ RCON 3385 2,276,646 6.a.(2)
(3) Loans to finance agricultural production and other loans to farmers......... RCON 3386 4,743 6.a.(3)
(4) Commercial and industrial loans............................................. RCON 3387 1,250,490 6.a.(4)
(5) Loans to individuals for household, family, and other personal
expenditures................................................................ RCON 3388 943,543 6.a.(5)
b. Total loans in foreign offices, Edge and Agreement subsidiaries, and IBFs........ RCFN 3360 0 6.b.
7. Trading assets........................................................................ RCFD 3401 21,325 7.
8. Lease financing receivables (net of unearned income).................................. RCFD 3484 172,076 8.
9. Total assets(4)....................................................................... RCFD 3368 7,619,514 9.
LIABILITIES
10. Interest-bearing transaction accounts in domestic offices (NOW accounts, ATS accounts,
and telephone and preauthorized transfer accounts) (exclude demand deposits).......... RCON 3485 734,026 10.
11. Nontransaction accounts in domestic offices:
a. Money market deposit accounts (MMDAs)............................................ RCON 3486 1,687,914 11.a.
b. Other savings deposits........................................................... RCON 3487 336,460 11.b.
c. Time certificates of deposit of $100,000 or more................................. RCON 3345 538,187 11.c.
d. All other time deposits.......................................................... RCON 3469 1,351,050 11.d.
12. Interest-bearing deposits in foreign offices, Edge and Agreement subsidiaries,
and IBFs.............................................................................. RCFN 3404 80,972 12.
13. Federal funds purchased and securities sold under agreements to repurchase in
domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs.. RCFD 3353 820,928 13.
14. Other borrowed money.................................................................. RCFD 3355 234,682 14.
------------------------
</TABLE>
- ---------------
(1) For all items, banks have the option of reporting either (1) an average of
daily figures for the quarter or (2) an average of weekly figures (i.e., the
Wednesday of each week of the quarter).
(2) Quarterly averages for all debt securities should be based on amortized
cost.
(3) Quarterly averages for all equity securities should be based on historical
cost.
(4) The quarterly average for total assets should reflect all debt securities
(not held for trading) at amortized cost, equity securities with readily
determinable fair values at the lower of cost or fair value, and equity
securities without readily determinable fair values at historical cost.
23
<PAGE> 58
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-14
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-L--OFF-BALANCE SHEET ITEMS
Please read carefully the instructions for the preparation of Schedule RC-L.
Some of the amounts reported in Schedule RC-L are regarded as volume indicators
and not necessarily as measures of risk.
<TABLE>
<CAPTION>
----------
C460 <-
-------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Unused commitments:
a. Revolving, open-end lines secured by 1-4 family residential properties, e.g.,
home equity lines................................................................ 3814 177,227 1.a.
b. Credit card lines................................................................ 3815 5,566 1.b.
c. Commercial real estate, construction, and land development:
(1) Commitments to fund loans secured by real estate............................. 3816 105,987 1.c.(1)
(2) Commitments to fund loans not secured by real estate......................... 6550 36,668 1.c.(2)
d. Securities underwriting.......................................................... 3817 0 1.d.
e. Other unused commitments......................................................... 3818 1,595,279 1.e.
2. Financial standby letters of credit and foreign office guarantees................... 3819 119,129 2.
a. Amount of financial standby letters of credit conveyed to
others .................................................... RCFD 3820 2,500 2.a.
3. Performance standby letters of credit and foreign office guarantees................. 3821 85,922 3.
a. Amount of performance standby letters of credit conveyed to
others..................................................... RCFD 3822 3,848 3.a.
4. Commercial and similar letters of credit............................................ 3411 161,992 4.
5. Participations in acceptances (as described in the instructions) conveyed to others
by the reporting bank............................................................... 3428 0 5.
6. Participations in acceptances (as described in the instructions) acquired by the
reporting (nonaccepting) bank....................................................... 3429 0 6.
7. Securities borrowed................................................................. 3432 0 7.
8. Securities lent (including customers' securities lent where the customer is
indemnified against loss by the reporting bank)..................................... 3433 149,558 8.
9. Mortgages transferred (i.e., sold or swapped) with recourse that have been treated
as sold for Call Report purposes:
a. FNMA and FHLMC residential mortgage loan pools:
(1) Outstanding principal balance of mortgages transferred as of the report
date......................................................................... 3650 0 9.a.(1)
(2) Amount of recourse exposure on these mortgages as of the report date......... 3651 0 9.a.(2)
b. Private (nongovernment-issued or -guaranteed) residential mortgage loan pools:
(1) Outstanding principal balance of mortgages tarnsferred as of the report
date......................................................................... 3652 0 9.b.(1)
(2) Amount of recourse exposure on these mortgages as of the report date......... 3653 0 9.b.(2)
c. Farmer Mac agricultural mortgage loan pools:
(1) Outstanding principal balance of mortgages transferred as of the report
date......................................................................... 3654 0 9.c.(1)
(2) Amount of recourse exposure on these mortgages as of the report date......... 3655 0 9.c.(2)
10. When-issued securities:
a. Gross commitments to purchase.................................................... 3434 3,195 10.a.
b. Gross commitments to sell........................................................ 3435 3,195 10.b.
11. Spot foreign exchange contracts..................................................... 8765 587 11.
12. All other off-balance sheet liabilities (exclude off-balance sheet derivatives)
(itemize and describe each component of this item over 25% of Schedule RC,
item 28, "Total equity capital").................................................... 3430 0 12.
a. TEXT 3555: .................................................. RCFD 3555 12.a.
b. TEXT 3556: .................................................. RCFD 3556 12.b.
c. TEXT 3557: .................................................. RCFD 3557 12.c.
d. TEXT 3558: .................................................. RCFD 3558 12.d.
13. All other off-balance sheet assets (exclude off-balance sheet derivatives) (itemize
and describe each component of this item over 25% of Schedule RC, item 28, "Total
equity capital").................................................................... 5591 0 13.
a. TEXT 5592: .................................................. RCFD 5592 13.a.
b. TEXT 5593: .................................................. RCFD 5593 13.b.
c. TEXT 5594: .................................................. RCFD 5594 13.c.
d. TEXT 5595: .................................................. RCFD 5595 13.d.
-------------------
</TABLE>
24
<PAGE> 59
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-15
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-L--CONTINUED
<TABLE>
<CAPTION>
--------
C461 <-
--------------------------------------------------------------------------------
(Column A) (Column B) (Column C) (Column D)
Interest Foreign Equity Commodity
Dollar Amounts in Thousands Rate Exchange Derivative and Other
- ------------------------------------------- Contracts Contracts Contracts Contracts
Off-balance Sheet Derivatives --------------------------------------------------------------------------------
Position Indicators Tril Bil Mil Thou Tril Bil Mil Thou Tril Bil Mil Thou Tril Bil Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
14. Gross amounts (e.g., notional amounts)
(for each column, sum of items 14.a
through 14.e must equal sum of items
15, 16.a, and 16.b):
a. Futures contracts.............. 193,100 0 0 0 14.a.
----------------------------------------------------------------------------
RCFD 8693 RCFD 8694 RCFD 8695 RCFD 8696
----------------------------------------------------------------------------
b. Forward contracts.............. 6,426 19,599 0 0 14.b.
----------------------------------------------------------------------------
RCFD 8697 RCFD 8698 RCFD 8699 RCFD 8700
----------------------------------------------------------------------------
c. Exchange-traded option contracts:
----------------------------------------------------------------------------
(1) Written options............ 500 0 0 0 14.c.(1)
----------------------------------------------------------------------------
RCFD 8701 RCFD 8702 RCFD 8703 RCFD 8704
----------------------------------------------------------------------------
(2) Purchased options.......... 0 0 0 0 14.c.(2)
----------------------------------------------------------------------------
RCFD 8705 RCFD 8706 RCFD 8707 RCFD 8708
----------------------------------------------------------------------------
d. Over-the-counter option contracts:
----------------------------------------------------------------------------
(1) Written options............ 26,000 1,083 0 0 14.d.(1)
----------------------------------------------------------------------------
RCFD 8709 RCFD 8710 RCFD 8711 RCFD 8712
----------------------------------------------------------------------------
(2) Purchased options.......... 26,000 1,083 0 0 14.d.(2)
----------------------------------------------------------------------------
RCFD 8713 RCFD 8714 RCFD 8715 RCFD 8716
----------------------------------------------------------------------------
e. Swaps.......................... 1,702,600 0 0 0 14.e.
----------------------------------------------------------------------------
RCFD 3450 RCFD 3826 RCFD 8719 RCFD 8720
----------------------------------------------------------------------------
15. Total gross notional amount of
derivative contracts held for
trading............................. 112,026 21,765 0 0 15.
----------------------------------------------------------------------------
RCFD A126 RCFD A127 RCFD 8723 RCFD 8724
----------------------------------------------------------------------------
16. Total gross notional amount of
derivative contracts held for
purposes other than trading:
----------------------------------------------------------------------------
a. Contracts marked to market..... 0 0 0 0 16.a.
----------------------------------------------------------------------------
RCFD 8725 RCFD 8726 RCFD 8727 RCFD 8728
----------------------------------------------------------------------------
b. Contracts not marked to market. 1,842,600 0 0 0 16.b.
----------------------------------------------------------------------------
RCFD 8729 RCFD 8730 RCFD 8731 RCFD 8732
----------------------------------------------------------------------------
</TABLE>
25
<PAGE> 60
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-16
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-L--CONTINUED
<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
(Column A) (Column B) (Column C) (Column D)
Interest Foreign Equity Commodity
Dollar Amounts in Thousands Rate Exchange Derivative And Other
- ------------------------------------------- Contracts Contracts Contracts Contracts
Off-balance Sheet Derivatives --------------------------------------------------------------------------------
Position Indicators RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
17. Gross fair values of derivative
contracts:
a. Contracts held for trading:
(1) Gross positive fair
value...................... 8733 144 8734 646 8735 0 8736 0 17.a.(1)
(2) Gross negative fair
value...................... 8737 154 8738 80 8739 0 8740 0 17.a.(2)
b. Contracts held for purposes
other than trading that are
marked to market:
(1) Gross positive fair
value...................... 8741 0 8742 0 8743 0 8744 0 17.b.(1)
(2) Gross negative fair
value...................... 8745 0 8746 0 8747 0 8748 0 17.b.(2)
c. Contracts held for purposes
other than trading that are
not marked to market:
(1) Gross positive fair
value...................... 8749 11,411 8750 0 8751 0 8752 0 17.c.(1)
(2) Gross negative fair
value...................... 8753 15,253 8754 0 8755 0 8756 0 17.c.(2)
-------------------------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
-------------------
Memoranda Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1.-2. Not applicable.................................................................
3. Unused commitments with an original maturity exceeding one year that are
reported in Schedule RC-L, items 1.a through 1.e, above (report only the unused
portions of commitments that are fee paid or otherwise legally binding)........ 3833 1,393,415 M.3.
a. Participations in commitments with an original maturity exceeding one year
conveyed to others.................................... RCFD 3834 19,182 M.3.a.
4. To be completed only by banks with $1 billion or more in total assets:
Standby letters of credit and foreign office guarantees (both financial and
performance) issued to non-U.S. addressees (domicile) included in
Schedule RC-L, items 2 and 3, above............................................ 3377 7,677 M.4.
5. To be completed for the September report only:
Installment loans to individuals for household, family and other personal
expenditures that have been securitized and sold without recourse (with
servicing retained), amounts outstanding by type of loan:
a. Loans to purchase private passenger automobiles............................. 2741 N/A M.5.a.
b. Credit cards and related plans.............................................. 2742 N/A M.5.b.
c. All other consumer installment credit (including mobile home loans)......... 2743 N/A M.5.c.
-------------------
</TABLE>
26
<PAGE> 61
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-17
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-M--MEMORANDA
<TABLE>
<CAPTION>
-------
C465 <-
------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Extensions of credit by the reporting bank to its executive officers, directors,
principal shareholders, and their related interests as of the report date:
a. Aggregate amount of all extensions of credit to all executive officers, directors,
principal shareholders and their related interests................................... 6164 206,321 1.a.
b. Number of executive officers, directors, and principal shareholders to whom the
amount of all extensions of credit by the reporting bank (including extensions
of credit to related interests) equals or exceeds the lesser of $500,000 or
5 percent of total capital as defined for this purpose in agency Number
regulations.................................................... RCFD 6165 11 1.b.
2. Federal funds sold and securities purchased under agreements to resell with U.S.
branches and agencies of foreign banks(1) (included in Schedule RC, items 3.a and
3.b).................................................................................... 3405 0 2.
3. Not applicable.
4. Outstanding principal balance of 1-4 family residential mortgage loans serviced for
others (include both retained servicing and purchased servicing):
a. Mortgages serviced under a GNMA contract............................................. 5500 0 4.a.
b. Mortgages serviced under a FHLMC contract:
(1) Serviced with recourse to servicer............................................... 5501 0 4.b.(1)
(2) Serviced without recourse to servicer............................................ 5502 116,063 4.b.(2)
c. Mortgages serviced under a FNMA contract:
(1) Serviced under a regular option contract......................................... 5503 0 4.c.(1)
(2) Serviced under a special option contract......................................... 5504 104,791 4.c.(2)
d. Mortgages serviced under other servicing contracts................................... 5505 15,849 4.d.
5. To be completed only by banks with $1 billion or more in total assets:
Customers' liability to this bank on acceptances outstanding (sum of items 5.a and 5.b
must equal Schedule RC, item 9):
a. U.S. addressees (domicile)........................................................... 2103 22,055 5.a.
b. Non-U.S. addressees (domicile)....................................................... 2104 0 5.b.
6. Intangible assets:
a. Mortgage servicing rights............................................................ 3164 0 6.a.
b. Other identifiable intangible assets:
(1) Purchased credit card relationships.............................................. 5506 0 6.b.(1)
(2) All other identifiable intangible assets......................................... 5507 5,514 6.b.(2)
c. Goodwill............................................................................. 3163 11,851 6.c.
d. Total (sum of items 6.a through 6.c) (must equal Schedule RC, item 10)............... 2143 17,365 6.d.
e. Intangible assets that have been grandfathered for regulatory capital purposes....... 6442 0 6.e.
7. Mandatory convertible debt, net of common or perpetual preferred stock
dedicated to redeem the debt............................................................ 3295 0 7.
------------------
</TABLE>
- ---------------
(1) Do not report federal funds sold and securities purchased under agreements
to resell with other commercial banks in the U.S. in this item.
27
<PAGE> 62
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-18
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-M--CONTINUED
<TABLE>
<CAPTION>
------------------------
Dollar Amounts in Thousands Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
8. a. Other real estate owned:
(1) Direct and indirect investments in real estate ventures....................... RCFD 5372 0 8.a.(1)
(2) All other real estate owned:
(a) Construction and land development in domestic offices.................... RCON 5508 5,496 8.a.(2)(a)
(b) Farmland in domestic offices............................................. RCON 5509 76 8.a.(2)(b)
(c) 1-4 family residential properties in domestic offices.................... RCON 5510 1,189 8.a.(2)(c)
(d) Multifamily (5 or more) residential properties in domestic offices....... RCON 5511 0 8.a.(2)(d)
(e) Nonfarm nonresidential properties in domestic offices.................... RCON 5512 2,628 8.a.(2)(e)
(f) In foreign offices....................................................... RCFN 5513 0 8.a.(2)(f)
(3) Total (sum of items 8.a.(1) and 8.a.(2)) (must equal Schedule RC, item 7)..... RCFD 2150 9,389 8.a.(3)
b. Investments in unconsolidated subsidiaries and associated companies:
(1) Direct and indirect investments in real estate ventures....................... RCFD 5374 0 8.b.(1)
(2) All other investments in unconsolidated subsidiaries and associated
companies..................................................................... RCFD 5375 0 8.b.(2)
(3) Total (sum of items 8.b.(1) and 8.b.(2)) (must equal Schedule RC, item 8)..... RCFD 2130 0 8.b.(3)
c. Total assets of unconsolidated subsidiaries and associated companies............... RCFD 5376 0 8.c
9. Noncumulative perpetual preferred stock and related surplus included in Schedule RC,
item 23, "Perpetual preferred stock and related surplus"................................ RCFD 3778 0 9.
10. Mutual fund and annuity sales in domestic offices during the quarter (include
proprietary, private label, and third party products):
a. Money market funds................................................................. RCON 6441 600 10.a.
b. Equity securities funds............................................................ RCON 8427 9,411 10.b.
c. Debt securities funds.............................................................. RCON 8428 4,946 10.c.
d. Other mutual funds................................................................. RCON 8429 3,928 10.d.
e. Annuities.......................................................................... RCON 8430 18,798 10.e.
f. Sales of proprietary mutual funds and annuities (included in items 10.a through
10.e above)........................................................................ RCON 8784 347 10.f.
------------------------
</TABLE>
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------
------------------------
Memorandum Dollar Amounts in Thousands RCFD Bil Mil Thou
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Interbank holdings of capital instruments (to be completed for the December report
only):
a. Reciprocal holdings of banking organizations' capital instruments.................. 3836 N/A M.1.a.
b. Nonreciprocal holdings of banking organizations' capital instruments............... 3837 N/A M.1.b.
------------------------
- ----------------------------------------------------------------------------------------------------------------------
</TABLE>
28
<PAGE> 63
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-19
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-N--PAST DUE AND NONACCRUAL LOANS, LEASES, AND OTHER ASSETS
The FFIEC regards the information reported in all of Memorandum item 1, in items
1 through 10, column A, and in Memorandum items 2 through 4, column A, as
confidential.
<TABLE>
<CAPTION>
----------
C470 <-
-------------------------------------------------------------
(Column A) (Column B) (Column C)
Past due Past due 90 Nonaccrual
30 through 89 days or more
days and still and still
accruing accruing
-------------------------------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. Loans secured by real estate:
a. To U.S. addressees (domicile)................... 1245 7,644 1246 1,453 1247 10,642 1.a.
b. To non-U.S. addressees (domicile)............... 1248 0 1249 0 1250 0 1.b.
2. Loans to depository institutions and acceptances of
other banks:
a. To U.S. banks and other U.S. depository
institutions.................................... 5377 0 5378 0 5379 0 2.a.
b. To foreign banks................................ 5380 0 5381 0 5382 0 2.b.
3. Loans to finance agricultural production and other
loans to farmers..................................... 1594 104 1597 0 1583 0 3.
4. Commercial and industrial loans:
a. To U.S. addressees (domicile)................... 1251 3,819 1252 3,620 1253 4,002 4.a.
b. To non-U.S. addressees (domicile)............... 1254 0 1255 0 1256 0 4.b.
5. Loans to individuals for household, family, and other
personal expenditures:
a. Credit cards and related plans.................. 5383 384 5384 216 5385 0 5.a.
b. Other (includes single payment, installment, and
all student loans).............................. 5386 5,333 5387 1,032 5388 0 5.b.
6. Loans to foreign governments and official
institutions......................................... 5389 0 5390 0 5391 0 6.
7. All other loans...................................... 5459 332 5460 81 5461 51 7.
8. Lease financing receivables:
a. Of U.S. addressees (domicile)................... 1257 226 1258 17 1259 350 8.a.
b. Of non-U.S. addressees (domicile)............... 1271 0 1272 0 1791 0 8.b.
9. Debt securities and other assets (exclude other real
estate owned and other repossessed assets)........... 3505 0 3506 0 3507 0 9.
-------------------------------------------------------------
==============================================================================================================================
</TABLE>
Amounts reported in items 1 through 8 above include guaranteed and unguaranteed
portions of past due and nonaccrual loans and leases. Report in item 10 below
certain guaranteed loans and leases that have already been included in the
amounts reported in items 1 through 8.
<TABLE>
<CAPTION>
-------------------------------------------------------------
RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou
-------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
10. Loans and leases reported in items 1 through 8 above
which are wholly or partially guaranteed by the U.S.
Government........................................... 5612 0 5613 0 5614 682 10.
a. Guaranteed portion of loans and leases included
in item 10 above................................ 5615 0 5616 0 5617 479 10.a.
-------------------------------------------------------------
</TABLE>
29
<PAGE> 64
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-20
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-N--CONTINUED
<TABLE>
<CAPTION>
----------
C473 <-
-------------------------------------------------------
(Column A) (Column B) (Column C)
Past due Past due 90 Nonaccrual
30 through 89 days or more
days and still and still
accruing accruing
Memoranda -------------------------------------------------------
Dollar Amounts In Thousands RCFD Bil Mil Thou RCFD Bil Mil Thou RCFD Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
1. Restructured loans and leases included in
Schedule RC-N, items 1 through 8, above (and not
reported in Schedule RC-C, part I, Memorandum
item 2)........................................... 1658 0 1659 0 1661 0 M.1.
2. Loans to finance commercial real estate,
construction, and land development activities
(not secured by real estate) included in Schedule
RC-N, items 4 and 7, above........................ 6558 0 6559 0 6560 0 M.2.
-------------------------------------------------------
3. Loans secured by real estate in domestic offices RCON Bil Mil Thou RCON Bil Mil Thou RCON Bil Mil Thou
(included in Schedule RC-N, item 1, above): -------------------------------------------------------
a. Construction and land development.............. 2759 150 2769 55 3492 370 M.3.a.
b. Secured by farmland............................ 3493 5 3494 0 3495 77 M.3.b.
c. Secured by 1-4 family residential properties:
(1) Revolving, open-end loans secured by 1-4
family residential properties and extended
under lines of credit...................... 5398 367 5399 0 5400 0 M.3.c.(1)
(2) All other loans secured by 1-4 family
residential properties..................... 5401 3,794 5402 1,175 5403 459 M.3.c.(2)
d. Secured by multifamily (5 or more) residential
properties..................................... 3499 0 3500 0 3501 0 M.3.d.
e. Secured by nonfarm nonresidential properties... 3502 3,328 3503 223 3504 9,736 M.3.e.
-------------------------------------------------------
</TABLE>
<TABLE>
<CAPTION>
------------------------------------
(Column A) (Column B)
Past due 30 Past due 90
through 89 days days or more
------------------------------------
RCFD Bil Mil Thou RCFD Bil Mil Thou
------------------------------------
<S> <C> <C> <C> <C> <C>
4. Interest rate, foreign exchange rate, and other
commodity and equity contracts:
a. Book value of amounts carried as assets........ 3522 0 3528 0 M.4.a.
b. Replacement cost of contracts with a positive
replacement cost............................... 3529 0 3530 0 M.4.b.
------------------------------------
</TABLE>
30
<PAGE> 65
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-21
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-O--OTHER DATA FOR DEPOSIT INSURANCE ASSESSMENTS
<TABLE>
<CAPTION>
----------
C475 <-
-----------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Unposted debits (see instructions):
a. Actual amount of all unposted debits............................................... 0030 0 1.a.
OR
b. Separate amount of unposted debits:
(1) Actual amount of unposted debits to demand deposits............................ 0031 N/A 1.b.(1)
(2) Actual amount of unposted debits to time and savings deposits(1)............... 0032 N/A 1.b.(2)
2. Unposted credits (see instructions):
a. Actual amount of all unposted credits.............................................. 3510 0 2.a.
OR
b. Separate amount of unposted credits:
(1) Actual amount of unposted credits to demand deposits........................... 3512 N/A 2.b.(1)
(2) Actual amount of unposted credits to time and savings deposits(1).............. 3514 N/A 2.b.(2)
3. Uninvested trust funds (cash) held in bank's own trust department (not included
in total deposits in domestic offices)................................................ 3520 0 3.
4. Deposits of consolidated subsidiaries in domestic offices and in insured branches in
Puerto Rico and U.S. territories and possessions (not included in total deposits):
a. Demand deposits of consolidated subsidiaries....................................... 2211 343 4.a.
b. Time and savings deposits(1) of consolidated subsidiaries.......................... 2351 0 4.b.
c. Interest accrued and unpaid on deposits of consolidated subsidiaries............... 5514 0 4.c.
5. Deposits in insured branches in Puerto Rico and U.S. territories and possessions:
a. Demand deposits in insured branches (included in Schedule RC-E, Part II)........... 2229 0 5.a.
b. Time and savings deposits(1) in insured branches (included in Schedule RC-E,
Part II)........................................................................... 2383 0 5.b.
c. Interest accrued and unpaid on deposits in insured branches
(included in Schedule RC-G, item 1.b).............................................. 5515 0 5.c.
-----------------
Item 6 is not applicable to state nonmember banks that have not been authorized by the
Federal Reserve to act as pass-through correspondents.
6. Reserve balances actually passed through to the Federal Reserve by the reporting bank
on behalf of its respondent depository institutions that are also reflected as deposit
liabilities of the reporting bank:
a. Amount reflected in demand deposits (included in Schedule RC-E, Part I,
Memorandum item 4.a)............................................................... 2314 0 6.a.
b. Amount reflected in time and savings deposits(1) (included in Schedule RC-E,
Part I, Memorandum item 4.b)....................................................... 2315 0 6.b.
7. Unamortized premiums and discounts on time and savings deposits:(1)
a. Unamortized premiums............................................................... 5516 0 7.a.
b. Unamortized discounts.............................................................. 5517 0 7.b.
-----------------
- -------------------------------------------------------------------------------------------------------------------
8. To be completed by banks with "Oakar deposits."
Total "Adjusted Attributable Deposits" of all institutions acquired under Section
5(d)(3) of the Federal Deposit Insurance Act (from most recent FDIC Oakar Transaction
Worksheet(s))......................................................................... 5518 45,204 8.
- -------------------------------------------------------------------------------------------------------------------
9. Deposits in lifeline accounts......................................................... 5596 9.
10. Benefit-responsive "Depository Institution Investment Contracts" (included in total
deposits in domestic offices)......................................................... 8432 0 10.
-----------------
</TABLE>
- ---------------
(1) For FDIC insurance assessment purposes, "time and savings deposits" consists
of nontransaction accounts and all transaction accounts other than demand
deposits.
31
<PAGE> 66
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-22
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
Schedule RC-O--Continued
<TABLE>
<CAPTION>
-----------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
11. Adjustments to demand deposits in domestic offices reported in Schedule RC-E for certain
reciprocal demand balances:
a. Amount by which demand deposits would be reduced if reciprocal demand balances between the
reporting bank and savings associations were reported on a net basis rather than a gross basis
in Schedule RC-E.............................................................................. 8785 0 11.a.
b. Amount by which demand deposits would be increased if reciprocal demand balances between the
reporting bank and U.S. branches and agencies of foreign banks were reported on a gross basis
rather than a net basis in Schedule RC-E...................................................... A181 0 11.b.
c. Amount by which demand deposits would be reduced if cash items in process of collection were
included in the calculation of net reciprocal demand balances between the reporting bank and
the domestic offices of U.S. banks and savings associations in Schedule RC-E.................. A182 0 11.c.
-----------------
</TABLE>
<TABLE>
<CAPTION>
Memoranda (To be completed each quarter except as noted)
-------------------------------
Dollar Amounts in Thousands RCON Bil Mil Thou
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
1. Total deposits in domestic offices of the bank (sum of Memorandum items 1.a.(1)
and 1.b.(1) must equal Schedule RC, item 13.a):
a. Deposit accounts of $100,000 or less:
(1) Amount of deposit accounts of $100,000 or less.............................. 2702 4,088,926 M.1.a.(1)
(2) Number of deposit accounts of $100,000 or less (to be completed Number
-------------------
for the June report only)................................ RCON 3779 675,285 M.1.a.(2)
-------------------
b. Deposit accounts of more than $100,000:
(1) Amount of deposit accounts of more than $100,000............................ 2710 1,779,828 M.1.b.(1)
Number
------------------
(2) Number of deposit accounts of more than $100,000......... RCON 2722 4,700 M.1.b.(2)
---------------------------------------------------
2. Estimated amount of uninsured deposits in domestic offices of the bank:
a. An estimate of your bank's uninsured deposits can be determined by multiplying
the number of deposit accounts of more than $100,000 reported in Memorandum item
1.b.(2) above by $100,000 and subtracting the result from the amount of deposit
accounts of more than $100,000 reported in Memorandum item 1.b.(1) above.
Indicate in the appropriate box at the right whether your bank has a method or YES NO
procedure for determining a better estimate of uninsured deposits than the --------------------------
estimate described above.................................................................. RCON 6861 X M.2.a.
--------------------------
------------------------
RCON Bil Mil Thou
b. If the box marked YES has been checked, report the estimate of uninsured deposits ------------------------
determined by using your bank's method or procedure......................................... 5597 N/A M.2.b.
------------------------
- ---------------------------------------------------------------------------------------------------------------------------------
Person to whom questions about the Reports of Condition and Income
should be directed: C477 <-
--------
Janice Kirkpatrick, Assistant Vice President (615) 781-7291
- -------------------------------------------- --------------------------------------------
Name and Title (TEXT 8901) Area code/phone number/extension (TEXT 8902)
</TABLE>
32
<PAGE> 67
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-23
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-R--RISK-BASED CAPITAL
This schedule must be completed by all banks as follows: Banks that reported
total assets of $1 billion or more in Schedule RC, item 12, for June 30, 1994,
must complete items 2 through 9 and Memoranda items 1 and 2. Banks with assets
of less than $1 billion must complete items 1 and 2 below or Schedule RC-R in
its entirety, depending on their response to item 1 below.
<TABLE>
<CAPTION>
--------
C480 <-
-----------
YES NO
-----------
<S> <C> <C>
1. Test for determining the extent to which Schedule RC-R must be completed. To be completed
only by banks with total assets of less than $1 billion. Indicate in the appropriate box
at the right whether the bank has total capital greater than or equal to eight percent of
adjusted total assets......................................................... RCFD 6056 1.
---------------------------------
For purposes of this test, adjusted total assets equals total assets
less cash, U.S. Treasuries, U.S. Government agency obligations, and 80
percent of U.S. Government-sponsored agency obligations plus the allowance
for loan and lease losses and selected off-balance sheet items as reported
on Schedule RC-L (see instructions).
If the box marked YES has been checked, then the bank only has to
complete item 2 below. If the box marked NO has been checked, the bank must
complete the remainder of this schedule.
A NO response to item 1 does not necessarily mean that the bank's
actual risk-based capital ratio is less than eight percent or that the bank
is not in compliance with the risk-based capital guidelines.
</TABLE>
<TABLE>
<CAPTION>
-------------------------------------
(Column A) (Column B)
Subordinated
Debt(1) and
Intermediate Other Limited-
Item 2 is to be completed by all banks. Term Preferred Life Capital
Stock Instruments
-------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCON Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
2. Subordinated debt(1) and other limited-life capital instruments
(original weighted average maturity of at least five years) with a
remaining maturity of:
a. One year or less................................................... 3780 0 3786 0 2.a.
b. Over one year through two years.................................... 3781 0 3787 0 2.b.
c. Over two years through three years................................. 3782 0 3788 0 2.c.
d. Over three years through four years................................ 3783 0 3789 0 2.d.
e. Over four years through five years................................. 3784 0 3790 0 2.e.
f. Over five years.................................................... 3785 0 3791 0 2.f.
------------------------------------
</TABLE>
<TABLE>
3. Not applicable
Items 4-9 and Memoranda items 1 and 2 are to be completed by banks that answered
NO to item 1 above and by banks with total assets of $1 billion or more.
<CAPTION>
------------------------------------
(Column A) (Column B)
Credit
Equivalent
Assets Recorded Amount of Off-
on the Balance Balance Sheet
Sheet Items(2)
------------------------------------
RCFD Bil Mil Thou RCON Bil Mil Thou
- --------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
4. Assets and credit equivalent amounts of off-balance sheet items assigned
to the Zero percent risk category:
a. Assets recorded on the balance sheet:
(1) Securities issued by, other claims on, and claims
unconditionally guaranteed by, the U.S. Government and its
agencies and other OECD central governments.................... 3794 424,819 4.a.(1)
(2) All other...................................................... 3795 118,397 4.a.(2)
b. Credit equivalent amount of off-balance sheet items................. 3796 34 4.b
-----------------------------------
</TABLE>
- ---------------
(1) Exclude mandatory convertible debt reported in Schedule RC-M, item 7.
(2) Do not report in column B the risk-weighted amount of assets reported in
column A.
33
<PAGE> 68
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-24
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
SCHEDULE RC-R--CONTINUED
<TABLE>
<CAPTION>
---------------------------------------
(Column A) (Column B)
Assets Credit Equivalent
Recorded Amount
on the of Off-Balance
Balance Sheet Sheet Items(1)
---------------------------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou RCFD Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
5. Assets and credit equivalent amounts of off-balance sheet items
assigned to the 20 percent risk category:
a. Assets recorded on the balance sheet:
(1) Claims conditionally guaranteed by the U.S. Government
and its agencies and other OECD central governments...... 3798 89,887 5.a.(1)
(2) Claims collateralized by securities issued by the U.S.
Government and its agencies and other OECD central
governments; by securities issued by U.S.
Government-sponsored agencies; and by cash on deposit.... 3799 29,137 5.a.(2)
(3) All other................................................ 3800 1,712,449 5.a.(3)
b. Credit equivalent amount of off-balance sheet items.......... 3801 190,860 5.b.
6. Assets and credit equivalent amounts of off-balance sheet items
assigned to the 50 percent risk category:
a. Assets recorded on the balance sheet......................... 3802 1,336,557 6.a.
b. Credit equivalent amount of off-balance sheet items.......... 3803 1,131 6.b.
7. Assets and credit equivalent amounts of off-balance sheet items
assigned to the 100 percent risk category:
a. Assets recorded on the balance sheet......................... 3804 4,217,844 7.a.
b. Credit equivalent amount of off-balance sheet items.......... 3805 880,550 7.b.
8. On-balance sheet asset values excluded from the calculation of
the risk-based capital ratio(2)................................. 3806 (484) 8.
9. Total assets recorded on the balance sheet (sum of items 4.a,
5.a, 6.a, 7.a, and 8, column A) (must equal Schedule RC, item 12
plus items 4.b and 4.c)......................................... 3807 7,928,606 9.
----------------------------------------
</TABLE>
Memoranda
<TABLE>
<CAPTION>
--------------------
Dollar Amounts in Thousands RCFD Bil Mil Thou
- -------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
1. Current credit exposure across all off-balance sheet derivative contracts
covered by the risk-based capital standards................................. 8764 7,410 M.1.
--------------------
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------
With a remaining maturity of
----------------------------------------------------------------------
Column A) (Column B) (Column C)
Over one year
through five Over five
One year or less years years
----------------------------------------------------------------------
RCFD Tril Bil Mil Thou RCFD Tril Bil Mil Thou RCFD Tril Bil Mil Thou
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
2. Notional principal amounts of off-balance
sheet derivative contracts(3):
a. Interest rate contracts.................... 3809 600 8766 1,288,294 8767 11,881 M.2.a.
b. Foreign exchange contracts................. 3812 19,599 8769 0 8770 0 M.2.b.
c. Gold contracts............................. 8771 0 8772 0 8773 0 M.2.c.
d. Other precious metals contracts............ 8774 0 8775 0 8776 0 M.2.d.
e. Other commodity contracts.................. 8777 0 8778 0 8779 0 M.2.e.
f. Equity derivative contracts................ A000 0 A001 0 A002 0 M.2.f.
----------------------------------------------------------------------
</TABLE>
- ---------------
(1) Do not report in column B the risk-weighted amount of assets reported in
column A.
(2) Include the difference between the fair value and the amortized cost of
available-for-sale securities in item 8 and report the amortized cost of
these securities in items 4 through 7 above. Item 8 also includes on-balance
sheet asset values (or portions thereof) of off-balance sheet interest rate,
foreign exchange rate, and commodity contracts and those contracts (e.g.,
futures contracts) not subject to risk-based capital. Exclude from item 8
margin accounts and accrued receivables as well as any portion of the
allowance for loan and lease losses in excess of the amount that may be
included in Tier 2 capital.
(3) Exclude foreign exchange contracts with an original maturity of 14 days or
less and all futures contracts.
34
<PAGE> 69
<TABLE>
<S> <C> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085 FFIEC 031
Address: First American Center Page RC-25
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
<TABLE>
<CAPTION>
OPTIONAL NARRATIVE STATEMENT CONCERNING THE AMOUNTS
REPORTED IN THE REPORTS OF CONDITION AND INCOME
AT CLOSE OF BUSINESS ON JUNE 30, 1995
<S> <C> <C>
First American National Bank Nashville Tennessee
- --------------------------------------------------------- ------------------------------------------ ----------
Legal Title of Bank City State
The management of the reporting bank may, if it wishes, the truncated statement will appear as the bank's
submit a brief narrative statement on the amounts statement both on agency computerized records and in
reported in the Reports of Condition and Income. This computer-file releases to the public.
optional statement will be made available to the public,
along with the publicly available data in the Reports of All information furnished by the bank in the narrative
Condition and Income, in response to any request for statement must be accurate and not misleading.
individual bank report data. However, the information Appropriate efforts shall be taken by the submitting
reported in column A and in all of Memorandum item 1 of bank to ensure the statement's accuracy. The statement
Schedule RC-N is regarded as confidential and will not must be signed, in the space provided below, by a senior
be released to the public. BANKS CHOOSING TO SUBMIT THE officer of the bank who thereby attests to its accuracy.
NARRATIVE STATEMENT SHOULD ENSURE THAT THE STATEMENT
DOES NOT CONTAIN THE NAMES OR OTHER IDENTIFICATIONS OF If, subsequent to the original submission, material
INDIVIDUAL BANK CUSTOMERS, REFERENCES TO THE AMOUNTS changes are submitted for the data reported in the
REPORTED IN THE CONFIDENTIAL ITEMS IN SCHEDULE RC-N, OR Reports of Condition and Income, the existing narrative
ANY OTHER INFORMATION THAT THEY ARE NOT WILLING TO HAVE statement will be deleted from the files, and from
MADE PUBLIC OR THAT WOULD COMPROMISE THE PRIVACY OF disclosure; the bank, at its option, may replace it with
THEIR CUSTOMERS. Banks choosing not to make a statement a statement, under signature, appropriate to the amended
may check the "No comment" box below and should make no data.
entries of any kind in the space provided for the
narrative statement; i.e., DO NOT enter in this space The optional narrative statement will appear in agency
such phrases as "No statement," "Not applicable," "N/A," records and in release to the public exactly as
"No Comment," and "None." submitted (or amended as described in the preceding
paragraph) by the management of the bank (except for the
The optional statement must be entered on this sheet. truncation of statements exceeding the 750-character
The statement should not exceed 100 words. Further, limit described above). THE STATEMENT WILL NOT BE EDITED
regardless of the number of words, the statement must OR SCREENED IN ANY WAY BY THE SUPERVISORY AGENCIES FOR
not exceed 750 characters, including punctuation, ACCURACY OR RELEVANCE. DISCLOSURE OF THE STATEMENT SHALL
indentation, and standard spacing between words and NOT SIGNIFY THAT ANY FEDERAL SUPERVISORY AGENCY HAS
sentences. If any submission should exceed 750 VERIFIED OR CONFIRMED THE ACCURACY OF THE INFORMATION
characters, as defined, it will be truncated at 750 CONTAINED THEREIN. A STATEMENT TO THIS EFFECT WILL
characters with no notice to the submitting bank and APPEAR ON ANY PUBLIC RELEASE OF THE OPTIONAL STATEMENT
SUBMITTED BY THE MANAGEMENT OF THE REPORTING BANK.
- ---------------------------------------------------------------------------------------------------------------------------
No comment: X (RCON 6979) C471 C472 <-
----------------
BANK MANAGEMENT STATEMENT (please type or print clearly):
(TEXT 6980)
---------------------------------------- -------------------
Signature of Executive Officer of Bank Date of Signature
</TABLE>
35
<PAGE> 70
<TABLE>
<S> <C> <C> <C>
Legal Title of Bank: First American National Bank Call Date: 6/30/95 ST-BK: 47-2085
Address: First American Center
City, State Zip: Nashville, TN 37237
FDIC Certificate No.: 04956
</TABLE>
<TABLE>
<S> <C> <C>
THIS PAGE IS TO BE COMPLETED BY ALL BANKS
- ----------------------------------------------------------------------------------------------------------------------------------
NAME AND ADDRESS OF BANK OMB No. For OCC: 1557-0081
OMB No. For FDIC: 3064-0052
OMB No. For Federal Reserve: 7100-0036
Expiration Date: 3/31/96
PLACE LABEL HERE
SPECIAL REPORT
(Dollar Amounts in Thousands)
----------------------------------------------------------------------------------
CLOSE OF BUSINESS DATE: FDIC Certificate Number:
6/30/95 04956 C-700 <-
- ----------------------------------------------------------------------------------------------------------------------------------
LOANS TO EXECUTIVE OFFICERS (Complete as of each Call Report Date)
- ----------------------------------------------------------------------------------------------------------------------------------
The following information is required by Public Laws 90-44 and 102-242, but does not constitute a part of the Report of Condition.
With each Report of Condition, these Laws require all banks to furnish a report of all loans or other extensions of credit to their
executive officers made since the date of the previous Report of Condition. Data regarding individual loans or other extensions of
credit are not required. If no such loans or other extensions of credit were made during the period, insert "none" against subitem
(a). (Exclude the first $15,000 of indebtedness of each executive officer under bank credit card plan.) See Sections 215.2 and 215.3
of Title 12 of the Code of Federal Regulations (Federal Reserve Board Regulation O) for the definitions of "executive officer" and
"extension of credit," respectively. Exclude loans and other extensions of credit to directors and principal shareholders who are
not executive officers.
- ---------------------------------------------------------------------------------------------------------------------------
a. Number of loans made to executive officers since the previous ----------------------------------
Call Report date. . . . . . . . . . . . . . . . . . . . . . . . . . RCFD 3561 0 a.
----------------------------------
b. Total dollar amount of above loans (in thousands of dollars) . . . . RCFD 3562 0 b.
----------------------------------
c. Range of interest charged on above loans (example: -------------------------------------------------
9 3/4% = 9.75) . . . . . . . . . . . . . . . . . . . RCFD 7701 0.00 % to RCFD 7702 0.00 % c.
-------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------------------------------------
SIGNATURE AND TITLE OF OFFICER AUTHORIZED TO SIGN REPORT DATE (Month, Day, Year):
- ----------------------------------------------------------------------- ----------------------------------------------
NAME AND TITLE OF PERSON TO WHOM INQUIRIES MAY BE DIRECTED (TEXT 8903) AREA CODE/PHONE NUMBER
EXTENSION (TEXT 8904)
Janice Kirkpatrick, Assistant Vice President (615) 781-7291
- ---------------------------------------------------------------------------------------------------------------------------
FDIC 8040/53 (6-95)
</TABLE>
36
