EXHIBIT 4.3
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CII FINANCIAL, INC.
SIERRA HEALTH SERVICES, INC.
and
CHEMICAL BANK,
as Trustee
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FIRST SUPPLEMENTAL INDENTURE
Dated as of October __, 1995
to
INDENTURE
Dated as of September 15, 1991
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7 1/2% Convertible Subordinated Debentures Due 2001
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First Supplemental Indenture dated as of October __, 1995, among CII
Financial, Inc., a California corporation (the "Company"), Sierra Health
Services, Inc., a Nevada corporation ("Sierra"), and Chemical Trust Company of
California, a California corporation and successor to Manufacturers Hanover
Trust Company, as trustee (the "Trustee").
R E C I T A L S
- - - - - - - -
WHEREAS, the Company has duly authorized, executed and delivered to
the Trustee that certain Indenture dated as of September 15, 1991 pursuant to
which the Company's 7 1/2% Convertible Subordinated Debentures Due 2001 (the
"Securities") were issued (all capitalized terms used herein and not otherwise
defined shall have the meanings ascribed thereto in the Indenture);
WHEREAS, pursuant to that certain Agreement and Plan of Merger dated
as of June 12, 1995 among Sierra, Health Acquisition Corp., a wholly-owned
subsidiary of Sierra ("Sierra Subsidiary"), and the Company, Sierra Subsidiary
would merge (the "Merger") with and into the Company and each outstanding share
of Common Stock, stated value $.50 per share (the "CII Common Stock"), of the
Company would be converted into 0.37 of a share of Common Stock, $.005 par value
(the "Sierra Common Stock"), of Sierra as fully described in the Joint Proxy
Statement/Prospectus dated September 19, 1995 of the Company and Sierra;
WHEREAS, in connection with the Merger, the Boards of Directors of the
Company and Sierra have determined that it is in the best interests of the
Company and Sierra to provide that the Securities will be convertible into
Sierra Common Stock instead of CII Common Stock after the consummation of the
Merger pursuant to Section 13.11 of the Indenture;
WHEREAS, the Boards of Directors of the Company and Sierra adopted
Board Resolutions on _____________, 1995 authorizing the Company and Sierra,
among other things, to enter into a supplemental indenture to provide for the
conversion of the Securities into Sierra Common Stock after the consummation of
the Merger pursuant to Section 13.11 of the Indenture;
WHEREAS, pursuant to Section 9.1(4) of the Indenture, without the
consent of any Holders, the Company, when authorized by Board Resolution, and
the Trustee, at any time and from time to time, may enter into one or more
indentures supplemental to the Indenture, for, among other purposes, to make
provision with respect to the conversion rights of Holders pursuant to Section
13.11 of the Indenture;
NOW, THEREFORE, the Company and Sierra each covenant and agree with
the Trustee, for the equal and proportionate benefit of those who shall hold the
Securities from time to time, as hereinafter set forth.
ARTICLE ONE
Conversion of Securities
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Section 1.1. Conversion Privileges. Upon the consummation of the
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Merger and the execution and delivery of this First Supplemental Indenture to
the Trustee, the Holder of each Security then outstanding shall have the right
thereafter, during the period such Security shall be convertible as specified in
Article 13 of the Indenture, to convert such Security only into Sierra Common
Stock at a price of $59.097 per share, subject to adjustment as provided in
Article 13.
Section 1.2 Conversion Covenants. Upon the consummation of the
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Merger and effectiveness of this First Supplemental Indenture, Sierra agrees to
be bound by the covenants set forth in Sections 13.7 and 13.9 of the Indenture
with respect to the Sierra Common Stock issuable upon conversion of the
Securities.
ARTICLE TWO
Miscellaneous Provisions
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Section 2.1. Interpretation. This First Supplemental Indenture is a
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supplemental indenture executed pursuant to Section 9.1(4) of the Indenture.
Upon execution, delivery and effectiveness pursuant to Article One of this First
Supplemental Indenture, the Indenture shall be modified and amended in
accordance with this First Supplemental Indenture, and all the terms and
conditions of both shall be read together as though they constitute one
instrument, except that, in case of conflict, the provisions of this First
Supplemental Indenture will control. In case of conflict between the terms and
conditions contained in the Securities and those contained in the Indenture, as
modified and amended by this First Supplemental Indenture, the provisions of the
Indenture, as modified and amended by this First Supplemental Indenture, shall
control.
Except as set forth in this First Supplemental Indenture, Sierra will
not assume the Company's obligations with respect to the Securities and will not
guarantee payment of principal, interest or any premium thereon.
Section 2.2. Successors and Assigns. All the covenants,
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stipulations, promises and agreements in this First Supplemental Indenture made
by or on behalf of the Company and Sierra, or the Trustee, shall bind and inure
to the benefit of their respective successors and assigns.
Section 2.3. Counterparts. This First Supplemental Indenture may be
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executed in any number of counterparts, and all such counterparts taken together
shall be deemed to constitute one and the same agreement.
Section 2.4. Title and Section Headings. The titles of the Articles
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and the Section headings are for convenience only and shall not affect the
construction hereof.
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Section 2.5. Recitals. The recitals contained herein and in the
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Securities, as amended hereby, (except the Trustee's certificates of
authentication) shall be taken as the statements of the Company and Sierra, and
the Trustee assumes no responsibility for their correctness. The Trustee makes
no representations as to the validity or sufficiency of this First Supplemental
Indenture or of the Securities, as amended hereby, or coupons.
Section 2.6. Governing Law. This First Supplemental Indenture shall
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be governed by and construed in accordance with the laws of the State of
California.
Section 2.7. Opinion of Counsel. In accordance with Section 8.1(3)
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of the Indenture, the Company shall provide the Trustee with an Officers'
Certificate and Opinion of Counsel for the Company, reasonably acceptable to the
Trustee, that the Merger and this First Supplemental Indenture comply with the
provisions of Article 8 of the Indenture and that all conditions precedent
therein relating to the Merger have been complied with.
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IN WITNESS WHEREOF, the parties hereto have caused this First
Supplemental Indenture to be duly executed as of the date above written.
CII FINANCIAL, INC.
By:
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Attest:
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SIERRA HEALTH SERVICES, INC.
By:
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Attest:
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CHEMICAL TRUST COMPANY OF CALIFORNIA,
as Trustee
By:
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Attest:
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STATE OF _______________ )
) ss.
COUNTY OF ______________ )
On the ____ day of October 1995, before me, personally came
_______________________________ to me known, who, being by me duly sworn, did
depose and say that he resides at _________________________________,
______________; that he is ____________________________ of CII FINANCIAL, INC.,
one of the parties described in and who executed the above instrument; and that
he signed his name thereto by authority of the Board of Directors of said
company.
WITNESS my hand and official seal.
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Notary Public in and for
said State
[Seal]
STATE OF _______________ )
) ss.
COUNTY OF ______________ )
On the ____ day of October 1995, before me, personally came
_______________________________ to me known, who, being by me duly sworn, did
depose and say that he resides at _________________________________,
______________; that he is ____________________________ of CII FINANCIAL, INC.,
one of the parties described in and who executed the above instrument; and that
he signed his name thereto by authority of the Board of Directors of said
company.
WITNESS my hand and official seal.
----------------------------------
Notary Public in and for
said State
[Seal]
5
STATE OF _______________ )
) ss.
COUNTY OF ______________ )
On the ____ day of October, 1995, before me, personally came
_______________________________ to me known, who, being by me duly sworn, did
depose and say that he resides at _________________________________,
______________; that he is ____________________________ of SIERRA HEALTH
SERVICES, INC., one of the parties described in and who executed the above
instrument; and that he signed his name thereto by authority of the Board of
Directors of said Company.
WITNESS my hand and official seal.
---------------------------------
Notary Public in and for
said State
[Seal]
STATE OF _______________ )
) ss.
COUNTY OF ______________ )
On the ____ day of October, 1995, before me, personally came
_______________________________ to me known, who, being by me duly sworn, did
depose and say that he resides at _________________________________,
______________; that he is ____________________________ of SIERRA HEALTH
SERVICES, INC., one of the parties described in and who executed the above
instrument; and that he signed his name thereto by authority of the Board of
Directors of said Company.
WITNESS my hand and official seal.
----------------------------------
Notary Public in and for
said State
[Seal]
6
STATE OF _______________ )
) ss.
COUNTY OF ______________ )
On the ____ day of October, 1995, before me, personally came
_______________________________ to me known, who, being by me duly sworn, did
depose and say that he resides at _________________________________,
______________; that he is ____________________________ of CHEMICAL TRUST
COMPANY OF CALIFORNIA, one of the parties described in and who executed the
above instrument; and that he signed his name thereto by authority of the Board
of Directors of said company.
WITNESS my hand and official seal.
------------------------------------
Notary Public in and for
said State
[Seal]
STATE OF _______________ )
) ss.
COUNTY OF ______________ )
On the ____ day of October, 1995, before me, personally came
_______________________________ to me known, who, being by me duly sworn, did
depose and say that he resides at _________________________________,
______________; that he is ____________________________ of CHEMICAL TRUST
COMPANY OF CALIFORNIA, one of the parties described in and who executed the
above instrument; and that he signed his name thereto by authority of the Board
of Directors of said company.
WITNESS my hand and official seal.
------------------------------------
Notary Public in and for
said State
[Seal]
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