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EXHIBIT 4.1
SERVICE CORPORATION INTERNATIONAL
AND
EQUITY CORPORATION INTERNATIONAL
TO
BANKERS TRUST COMPANY
AS TRUSTEE
FIRST SUPPLEMENTAL INDENTURE
Dated as of January 19, 1999
Supplementing and Amending Indenture Dated as of February 25, 1998
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THIS FIRST SUPPLEMENTAL INDENTURE, dated as of January 19,
1999 and effective and conditioned upon the consummation of the Merger (as
defined below) (this "Supplemental Indenture"), is by and among Equity
Corporation International, a corporation duly organized and existing under the
laws of the State of Delaware ("ECI"), having its principal executive office at
000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, Service Corporation
International, a corporation duly organized and existing under the laws of the
State of Texas ("SCI"), having its principal executive office at 0000 Xxxxx
Xxxxxxx, Xxxxxxx, Xxxxx 00000, and Bankers Trust Company, a banking corporation
duly organized and existing under the laws of the State of New York, as Trustee
(the "Trustee").
RECITALS OF ECI AND SCI
1. ECI has executed and delivered to the Trustee its
Indenture, dated as of February 25, 1998 (the "Indenture"), to provide for the
issuance of its 4 1/2% Convertible Subordinated Debentures due 2004 in an
original principal amount of $143,750,000, all of which are currently
outstanding (the "Securities").
2. Effective at such time as a Certificate of Merger is filed
with the Secretary of State of the State of Delaware, SCI Delaware Funeral
Services, Inc., a Delaware corporation and a wholly owned subsidiary of SCI
("Merger Sub"), will be merged with and into ECI pursuant to the provisions of
the General Corporation Law of the State of Delaware (the "Merger"), as a result
of which ECI will become a wholly owned subsidiary of SCI.
3. Each share of common stock of ECI which is issued and
outstanding immediately prior to the Merger will be, by virtue of the Merger and
without any action on the part of the holder thereof, converted into the number
of shares of the common stock, par value $1.00 per share, of SCI (the "SCI
Shares") determined by the provisions of the Agreement and Plan of Merger dated
as of August 6, 1998, as amended by the First Amendment to Agreement and Plan of
Merger dated as of December 14, 1998, by and among ECI, SCI and Merger Sub.
4. In connection with the Merger, ECI and SCI, pursuant to
appropriate resolutions of their respective boards of directors, have duly
determined to make, execute and deliver to the Trustee this Supplemental
Indenture in order to reflect the results of the Merger as required by the
Indenture and to provide for SCI to become a co-obligor with respect to certain
obligations of ECI arising under the Indenture and the Securities.
5. Pursuant to Section 4.11 of the Indenture, ECI, as the
survivor to the Merger, and SCI, as the company whose shares will be issued upon
conversion of the Securities, are required to execute and deliver to the Trustee
an indenture, supplemental to the Indenture, prior to the consummation of the
Merger.
6. The Indenture provides that, without the consent of any
Holders, ECI and the Trustee may enter into a supplemental indenture to comply
with Section 4.11 of the Indenture, among other things.
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7. The Board of Directors of ECI has determined that the
provisions of this Supplemental Indenture are considered reasonably necessary to
protect the interests of the Holders of the Securities.
8. ECI has determined that this Supplemental Indenture may
therefore be entered into without the consent of any Holder in accordance with
Section 11.1 of the Indenture.
9. ECI and SCI have duly authorized the execution and delivery
of this Supplemental Indenture and all things necessary have been done to make
this Supplemental Indenture a valid agreement of ECI and SCI, in accordance with
its terms.
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises, it is mutually
agreed, for the equal and proportionate benefit of the respective Holders from
time to time of the Securities, as follows:
ARTICLE ONE
DEFINITIONS
SECTION 1.1 INDENTURE TERMS.
Capitalized terms used but not defined in this Supplemental
Indenture have the respective meanings assigned to them in the Indenture.
ARTICLE TWO
CONCERNING THE SECURITIES
SECTION 2.1 CONVERSION PRIVILEGE.
The Holder of each Security outstanding on the date hereof
shall have the right from and after the effective date hereof, during the period
such Security shall be convertible as specified in Section 4.1 of the Indenture,
to convert such Security only into the number of SCI Shares, and cash in lieu of
fractional SCI Shares, receivable upon the effectiveness of the Merger by a
holder of the number of shares of Common Stock of the Company into which such
Security could have been converted immediately prior to the Merger, subject to
adjustment as provided in Section 2.2 herein.
SECTION 2.2 CONVERSION PRICE.
The price at which SCI Shares shall be delivered upon
conversion of the Securities (the "Conversion Price") shall be the price
specified in paragraph 8 of the Securities, as adjusted in accordance with
Article 4 of the Indenture prior to the Merger. For events subsequent to the
effective date of this Supplemental Indenture, the Conversion Price shall be
adjusted in a manner as nearly equivalent as may be practical to the adjustments
provided for in Article 4 of the Indenture.
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SECTION 2.3 SCI AS A CO-OBLIGOR.
ECI, SCI and the Trustee hereby agree that as of the effective
date of this Supplemental Indenture, SCI shall become a co-obligor with ECI (but
not as a successor to ECI) under the Indenture, as modified by this Supplemental
Indenture, and the Securities, and shall be jointly and severally liable with
ECI for the due and punctual payment of the principal of (and premium, if any)
and interest on the Securities, as fully and effectively as if SCI had
originally been an obligor under such Securities; provided, however, that SCI is
not assuming, or becoming a co-obligor for, the performance of any obligation or
liability of ECI under the Indenture or the Securities other than such payments;
provided further, that the obligations of SCI under the Indenture, as
supplemented by this Supplemental Indenture, and the Securities shall be (i)
subordinate and junior in right of payment to the prior payment in full of all
secured indebtedness of SCI, (ii) rank pari passu in right of payment with all
Senior Indebtedness of SCI that is unsecured, and (iii) rank senior in right of
payment to all subordinated indebtedness of SCI. "Senior Indebtedness of SCI"
means indebtedness which is not by its terms subordinate or junior in any
respect to any other indebtedness or other obligation of SCI.
SECTION 2.4 SEC REPORTS.
In the event that ECI is no longer subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, SCI shall file all
reports and other information and documents which it is required to file with
the SEC pursuant to Section 13 or 15(d) of the Exchange Act, and within 15 days
after it files them with the SEC, SCI shall file copies of all such reports,
information and other documents with the Trustee. In such event, the notes to
the consolidated financial statements of SCI shall include "summarized financial
information" concerning ECI as required by the SEC. The Trustee acknowledges
that ECI, in the event it is no longer subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, will not be required to prepare
separate financial statements pursuant to Section 6.2 of the Indenture.
ARTICLE THREE
CONCERNING THE TRUSTEE
SECTION 3.1 TERMS AND CONDITIONS.
The Trustee accepts this Supplemental Indenture and agrees to
perform the duties of the Trustee upon the terms and conditions herein and in
the Indenture set forth.
SECTION 3.2 NO RESPONSIBILITY.
The Trustee shall not be responsible in any manner whatsoever
for or in respect of (i) the validity or sufficiency of this Supplemental
Indenture, the authorization or permissibility of this Supplemental Indenture
pursuant to the terms of the Indenture or the due execution thereof by ECI or
SCI or (ii) the recitals herein contained, all such recitals being made by ECI
and SCI. The Trustee shall not be responsible in any manner to determine the
correctness of provisions contained
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in this Supplemental Indenture relating either to the kind or amount of
securities receivable by Holders of Securities upon the conversion of their
Securities after the Merger or to any adjustment provided herein.
ARTICLE FOUR
EFFECT OF EXECUTION AND DELIVERY HEREOF
From and after the execution and delivery of this Supplemental
Indenture, (i) the Indenture shall be deemed to be amended and modified as
provided herein, (ii) this Supplemental Indenture shall form a part of the
Indenture, (iii) except as modified and amended by this Supplemental Indenture,
the Indenture shall continue in full force and effect, (iv) the Securities shall
continue to be governed by the Indenture, as modified and amended by this
Supplemental Indenture, and (v) every Holder of Securities heretofore and
hereafter authenticated and delivered under the Indenture shall be bound by this
Supplemental Indenture.
ARTICLE FIVE
MISCELLANEOUS PROVISIONS
SECTION 5.1 HEADINGS DESCRIPTIVE.
The headings of the several Articles and Sections of this
Supplemental Indenture are inserted for convenience only and shall not in any
way affect the meaning or construction of any provision of this Supplemental
Indenture.
SECTION 5.2 RIGHTS AND OBLIGATIONS OF THE TRUSTEE.
All of the provisions of the Indenture, including but not
limited to the compensation and indemnity obligations pursuant to Section 9.7 of
the Indenture, with respect to the rights, privileges, immunities, powers and
duties of the Trustee shall be applicable in respect of this Supplemental
Indenture as fully and with the same effect as if set forth herein in full. In
the event ECI defaults solely in its payment obligations under clauses (1) or
(2) of Section 8.1 of the Indenture, the Trustee shall immediately make written
demand upon SCI for such payment obligations. Upon any default by SCI in such
payment obligations, any remedy which the Trustee or any security holder is
authorized to bring against ECI under Article 8 of the Indenture may be brought,
under the same circumstances and conditions (including notice requirements),
against SCI.
SECTION 5.3 SUCCESSORS AND ASSIGNS.
This Supplemental Indenture shall be binding upon and inure to
the benefit of and be enforceable by the respective successors and assigns of
the parties hereto and the Holders of any Securities then outstanding.
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SECTION 5.4 COUNTERPARTS.
This Supplemental Indenture may be executed in several
counterparts, each of which shall be an original and all of which shall
constitute but one and the same instrument.
SECTION 5.5 GOVERNING LAW.
This Supplemental Indenture shall be governed by and construed
in accordance with the laws of the State of New York.
IN WITNESS WHEREOF, the parties hereto have caused this
Supplemental Indenture to be duly executed, and their respective corporate seals
to be hereunto affixed and attested, all as of the day and year first above
written.
EQUITY CORPORATION INTERNATIONAL
By: /s/ Xxxxx X. Xxxxxx
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Name: Xxxxx X. Xxxxxx, III
Title: Chairman, President and
Chief Executive Officer
SERVICE CORPORATION INTERNATIONAL
By: /s/ Xxxxx X. Shelger
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Name: Xxxxx X. Shelger
Title: Senior Vice President, General Counsel
and Secretary
BANKERS TRUST COMPANY, as Trustee
By: /s/ Xxxxxx X. Xxxxxxx
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Name: Xxxxxx X. Xxxxxxx
Title: Assistant Vice President
