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EXHIBIT 4.1
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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
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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.
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.
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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 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.
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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.
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.
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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, III
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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
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