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EXHIBIT 1
NATIONAL HEALTH INVESTORS, INC.
Convertible Senior Subordinated Debentures Due January 1, 2006
NATIONAL HEALTH INVESTORS, INC., a real estate investment trust,
promises to pay to
Prime plus 1% Prime plus 1%
DUE January 1, 2006 DUE January 1, 2006
S P E C I M E N
or registered assigns, the principal sum of Twenty Million Dollars, on January
1, 2006
CUSIP 63633D AD 6
Interest Payment Dates: April 15, July 15, October 15 and
January 15
Record Dates: April 1, July 1, October 1 and January 1
Additional provisions of this Security are set forth on other side of
this Security.
Dated: December ____, 2000
CERTIFICATE OF AUTHENTICATION NATIONAL HEALTH INVESTORS, INC.
U.S. BANK TRUST NATIONAL ASSOCIATION,
as Trustee, certifies that this is one of the
Securities referred to in the within By:
mentioned Indenture ----------------------------
Chairman of the Board
By: By:
----------------------------- ----------------------------
Authorized Signatory President
SEAL
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NATIONAL HEALTH INVESTORS, INC.
Convertible Subordinated Debentures Due 2006
1. Interest. National Health Investors, Inc., a real estate
investment trust (the "Company"), promises to pay interest on the principal
amount of this Security at the annual rate of Prime (as reported in the Money
Section of the Wall Street Journal) plus 1%, adjusted quarterly on January 1,
April 1, July 1 and October 1 for the quarter commencing on that date; provided,
the interest rate shall not be below 9% and the interest rate for the first
period of December 29, 2000 to March 31, 2001 shall equal 10.5%. The Company
will pay interest quarterly in arrears on January 15, April 15, July 15 and
October 15 of each year beginning April 15, 2001. Interest on the Securities
will accrue from the most recent date to which interest has been paid or, if no
interest has been paid, from December 29, 2000; provided that, if there is no
existing Default in the payment of interest, and if this Security is
authenticated between a record date referred to on the face hereof and the next
succeeding interest payment date, interest shall accrue from such interest
payment date. Interest will be computed on the basis of a 360-day year of twelve
30-day months.
2. Method of Payment. The Company will pay interest on the
Securities (except defaulted interest) to the Persons who are the registered
Holders of the Securities at the close of business on the January 1, April 1,
July 1 or October 1 next preceding the interest payment date. Holders must
surrender Securities to a Paying Agent to collect principal payments. The
Company will pay principal and interest in money of the United States that at
the time of payment is legal tender for payment of public and private debts. The
Company, however, may pay principal and interest by its check payable in such
money. It may mail an interest check to a Holder's registered address.
The final installment of principal of and premium, if any, on this
Security shall be payable only upon surrender of this Security at the office or
agency designated by the Trustee. Payments of principal of and premium, if any,
and interest on this Security shall be made at the office or agency designated
by the Trustee, 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.
3. Registrar and Agents. Initially, U.S. Bank Trust National
Association, will act as Registrar, Paying Agent, Conversion Agent and agent for
service of notices and demands. The Company may change any Registrar,
co-registrar, Paying Agent, Conversion Agent and agent for service of notices
and demands without notice. The Company or any of its Subsidiaries may act as
Paying Agent or Conversion Agent. The address of U.S. Bank Trust National
Association is 180 East Fifth Street, St. Paul, Minnesota 55101.
4. Indenture; Limitations. The Company issued the Securities under
an Indenture dated as of November 28, 2000 (the "Indenture") between the Company
and U.S. Bank Trust National Association, the trustee (in such capacity, the
"Trustee"). Capitalized
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terms herein are used as defined in the Indenture unless otherwise defined
herein. The terms of the Securities include those stated in the Indenture and
those made part of the Indenture by reference to the Trust Indenture Act of 1939
(15 U.S. Code 77aaa-77bbbb) as in effect on the date of the Indenture. The
Securities are subject to all such terms, and the Holders of the Securities are
referred to the Indenture and said Act for a statement of them.
The Securities are general unsecured obligations of the Company
limited to $20,000,000 principal amount. The Indenture imposes certain
limitations on the ability of the Company to, among other things, make payments
in respect of its Capital Stock, merge or consolidate with any other Person and
sell, lease, transfer or otherwise dispose of its properties or assets.
5. Optional Redemption by the Company. The Company may, at its
option, redeem the Securities, at any time after January 1, 2002 in whole or
from time to time in part. In addition, the Company may, at its option, redeem
the securities in whole or in part, at any time, as necessary for the Company to
continue to qualify for Federal tax treatment as a real estate investment trust
("REIT") under Sections 856 through 860 of the Internal Revenue Code. The
Securities will be immediately redeemable by the Company to the extent, but only
to the extent, deemed sufficient by the Board of Directors of the Company to
prevent the Holder of such Securities or any other person having an interest
therein (if the Securities were thereupon converted) from being deemed to own
shares of Capital Stock in excess of the limits prescribed in Article Ninth of
the Company's Charter. In each of the foregoing, the Redemption Price shall be
equal to 100% of the principal amount thereof, plus accrued and unpaid interest
to the date of redemption.
6. Notice of Redemption. Notice of redemption will be mailed at
least 30 days, but not more than 60 days before the Redemption Date to each
Holder of Securities to be redeemed at his registered address. On and after the
Redemption Date interest ceases to accrue on Securities or portions of them
called for redemption.
7. Conversion. A Holder of a Security may convert such Security
into shares of common stock of the Company at any time on and after July 31,
2001 and before the close of business on January 1, 2006. If the Security is
called for redemption, the Holder may convert it at any time before the close of
business on the date fixed for such redemption. The initial conversion price is
$7.00 per share, subject to adjustment in certain events. To determine the
number of shares issuable upon conversion of a Security, divide the principal
amount, payable at maturity, to be converted by the conversion price in effect
on the conversion date. The Company will deliver a check for any fractional
share.
To convert a Security, a Holder must (1) complete and sign the
conversion notice on the back of the Security, (2) surrender the Security to the
Conversion Agent, (3) furnish appropriate endorsements and transfer documents if
required by the Registrar or Conversion Agent and (4) pay any transfer or
similar tax if required. No payment or adjustment is to be made on conversion
for interest accrued hereon or for dividends on shares of common stock issued on
conversion; provided, however, that if a Security is
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surrendered for conversion after the record date for a payment of interest and
on or before the interest payment date, then, notwithstanding such conversion,
the interest falling due to such interest payment date will be paid to the
Person in whose name the Security is registered at the close of business on such
record date and any Security surrendered for conversion during the period from
the close of business on any regular record payment date to the opening of
business on the corresponding interest payment date must be accompanied by
payment of an amount equal to the interest payable on such interest payment
date. A Holder may convert a portion of a Security if the remaining principal
amount after conversion is equal to $5,000 or more.
If the Company is a party to a consolidation or merger or a
transfer or lease of all or substantially all of its assets, the right to
convert a Security into shares of common stock may be changed into a right to
convert it into securities, cash or other assets of the Company or another
Person.
NOTWITHSTANDING ANYTHING HEREIN TO THE CONTRARY, A HOLDER SHALL
NOT BE ENTITLED TO EFFECT THE CONVERSION OF, AND NEITHER THE COMPANY, THE
CONVERSION AGENT NOR THE REGISTRAR SHALL BE REQUIRED TO TAKE ANY STEPS TO EFFECT
THE CONVERSION OF, ANY SECURITY OR SECURITIES OF ANY SERIES IF SUCH CONVERSION,
IN THE GOOD FAITH OPINION OF THE BOARD OF DIRECTORS OF THE COMPANY OR AN
OFFICER, (A) MIGHT CAUSE THE COMPANY TO FAIL TO COMPLY WITH ANY REQUIREMENT
NECESSARY FOR THE CONTINUED QUALIFICATION OF THE COMPANY AS A REIT UNDER THE
CODE OR (B) WOULD RESULT IN A SINGLE PERSON BEING AN OWNER (OR UPON CONVERSION
OF ANY SECURITIES OR CONVERSION OR EXCHANGE OF ANY OTHER SECURITIES OF THE
COMPANY THEREUPON BEING AN OWNER) OF MORE THAN 9.9% OF THE COMPANY'S OUTSTANDING
COMMON STOCK (INCLUDING THE COMPANY'S COMMON STOCK RESERVED FOR ISSUANCE UPON
CONVERSION OF SECURITIES HELD BY SUCH PERSON OR CONVERSION OR EXCHANGE OF OTHER
SECURITIES OF THE COMPANY HELD BY SUCH PERSON). ANY ATTEMPTED CONVERSION OF A
SECURITY OR SECURITIES BY A HOLDER IN VIOLATION OF THE LIMITS SET FORTH ABOVE
SHALL BE NULL AND VOID AB INITIO.
8. Subordination. This Security is subordinated to all Senior
Indebtedness of the Company. To the extent and in the manner provided in the
Indenture, Senior Indebtedness must be paid before any payment may be made to
any Holders of Securities. Any Security holder by accepting this Security agrees
to the subordination and authorizes the Trustee to give it effect.
In addition to all other rights of Senior Indebtedness described
in the Indenture, the Senior Indebtedness shall continue to be Senior
Indebtedness and entitled to the benefits of the subordination provisions
irrespective of any amendment, modification or waiver of any term of any
instrument relating to the Senior Indebtedness or extension or renewal of the
Senior Indebtedness.
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9. Denominations, Transfer, Exchange. This Security is one of a
duly authorized issue of Securities of the Company designated as its Convertible
Subordinated Debentures due 2006 limited in aggregate principal amount to
$20,000,000. The Securities are in registered form without coupons in
denominations of $5,000 principal amount or more. A Holder may register the
transfer of or exchange Securities in accordance with the Indenture. The
Registrar may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees required by
law or permitted by the Indenture. The Registrar need not register the transfer
of or exchange any Securities selected for redemption or register the transfer
of or exchange any Securities for a period of 15 days before a selection of
Securities to be redeemed.
10. Persons Deemed Owners. The registered Holder of a Security may
be treated as its owner for all purposes.
11. Unclaimed Money. If money for the payment of principal or
interest on any Securities remains unclaimed for two years, the Trustee and the
Paying Agent will pay the money back to the Company at its request. After that,
Holders may look only to the Company for payment.
12. Discharge Prior to Redemption or Maturity. The Indenture will
be discharged and canceled except for certain sections thereof upon payment of
all the Securities, or upon the irrevocable deposit with the Trustee of funds or
U.S. Government Obligations maturing on or before such payment date or
Redemption Date, sufficient to pay principal, premium, if any, and interest on
such payment or redemption.
13. Amendment and Waiver. Subject to certain exceptions, without
notice to the Holders of the Securities, the Indenture or the Securities may be
amended with the consent of the Holders of at least a majority in principal
amount of the Securities then outstanding and any existing default or compliance
with any provision may be waived with the consent of the Holders of a majority
in principal amount of the Securities then outstanding. Without the consent of
or notice to any Security holder, the Company may amend the Indenture or the
Securities to, among other things, provide for uncertificated Securities, to
establish another series of securities as permitted by the Indenture, to cure
any ambiguity, defect or inconsistency or make any other change that does not
adversely affect the rights of any Security holder.
14. Successors. When a successor assumes all the obligations of
its predecessor under the Securities and the Indenture, the predecessor will be
released from those obligations.
15. Defaults and Remedies. If an Event of Default, as defined in
the Indenture, occurs and is continuing, the Trustee or the Holders of a
majority in principal amount of Securities may declare all the Securities to be
due and payable immediately in the manner and with the effect provided in the
Indenture. Holders of Securities may not enforce the Indenture or the Securities
except as provided in the Indenture. The Trustee may require indemnity
satisfactory to it, subject to the provisions of the TIA, before it
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enforces the Indenture or the Securities. Subject to certain limitations,
Holders of a majority in principal amount of the Securities then outstanding may
direct the Trustee in its exercise of any trust or power with respect to the
Securities. The Company is required to file periodic reports with the Trustee as
to the absence of any Default or Event of Default.
16. Trustee Dealings with the Company. U.S. Bank Trust National
Association, the Trustee under the Indenture, in its individual or any other
capacity, may make loans to, accept deposits from, and perform services for the
Company or its Affiliates, and may otherwise deal with the Company or its
Affiliates, as if it were not Trustee.
17. No Recourse Against Others. No stockholder, director, officer
or incorporator, as such, past, present or future, of the Company or 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. This
waiver and release are part of the consideration for the issuance of the
Securities.
18. Authentication. This Security shall not be valid until the
Trustee or an authenticating agent appointed by the Trustee signs the
certificate of authentication on the other side of this Security.
19. Abbreviations. Customary abbreviations may be used in the name
of a Security holder or an assignee, such as: TEN COM (=tenants in common), TEN
ENT (=tenants by the entireties), JT TEN (=joint tenants with rights of
survivorship and not as tenants in common), CUST (=Custodian), and U/G/M/A
(=Uniform Gifts to Minors Act).
THE COMPANY WILL FURNISH TO ANY SECURITY HOLDER UPON WRITTEN
REQUEST AND WITHOUT CHARGE A COPY OF THE INDENTURE. IT ALSO WILL FURNISH THE
TEXT OF THIS SECURITY IN LARGER TYPE. REQUESTS MAY BE MADE TO: NATIONAL HEALTH
INVESTORS, INC., 100 VINE STREET, SUITE 1202, MURFREESBORO, TENNESSEE 37130
ATTENTION: PRESIDENT.
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ASSIGNMENT FORM
If you the Holder want to assign this Security, fill in the form below and have
your signature guaranteed:
For value received, I or we assign and transfer this Security to
(INSERT ASSIGNEE'S SOCIAL SECURITY OR
TAX IDENTIFICATION NUMBER)
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(Print or type assignee's name, address and zip code)
and irrevocably appoint
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agent to transfer this Security on the books of the
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Company. The agent may substitute another to act for him.
Date:
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Your signature:
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(Sign exactly as your name appears
on the other side of this Security)
Signature Guarantee:
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CONVERSION NOTICE
To convert this Security into shares of common stock of the Company, check the
box:
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To convert only part of this Security, state the principal amount to be
converted:
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$
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If you want the Security certificate, if any, made out in another person's name,
fill in the form below:
(INSERT OTHER PERSON'S SOCIAL SECURITY OR
TAX IDENTIFICATION NUMBER)
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(Print or type other person's name, address and zip code)
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Date:
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Your signature:
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(Sign exactly as your name appears
on the other side of this Security)
Signature Guaranteed By:
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