EXHIBIT 4.2
SUPPLEMENTAL INDENTURE
by and between
HEALTH AND RETIREMENT PROPERTIES TRUST
and
STATE STREET BANK AND TRUST COMPANY
as of December 18, 1997
SUPPLEMENTAL TO THE INDENTURE DATED AS OF DECEMBER 18, 1997
------------------------------------
HEALTH AND RETIREMENT PROPERTIES TRUST
$150,000,000 6 3/4% Senior Notes due December 18, 2002
This SUPPLEMENTAL INDENTURE (this "Supplemental Indenture") made and
entered into as of December 18, 1997 between HEALTH AND RETIREMENT PROPERTIES
TRUST, a Maryland real estate investment trust (the "Company"), and STATE STREET
BANK AND TRUST COMPANY, a Massachusetts trust company, as Trustee (the
"Trustee").
WITNESSETH THAT:
WHEREAS, the Company and the Trustee have executed and delivered an
Indenture, dated as of December 18, 1997 (the "Indenture"), relating to the
Company's issuance, from time to time, of various series of debt securities; and
WHEREAS, the Company has determined to issue debt securities known as
its $150,000,000 6 3/4% Senior Notes due December 18, 2002; and
WHEREAS, the Indenture provides that certain terms and conditions for
each series of debt securities issued by the Company thereunder may be set forth
in an indenture supplemental to the Indenture;
NOW, THEREFORE, THIS SUPPLEMENTAL INDENTURE WITNESSETH:
ARTICLE 1
DEFINED TERMS
Section 1.1 The following definitions supplement, and, to the extent
inconsistent with, replace the definitions in Section 1.1 of the Indenture:
"Acquired Debt" means Debt of a Person (i) existing at the time such
Person becomes a Subsidiary or (ii) assumed in connection with the acquisition
of assets from such Person, in each case, other than Debt incurred in connection
with, or in contemplation of, such Person's becoming a Subsidiary or such
acquisition. Acquired Debt shall be deemed to be incurred on the date of the
related acquisition of assets from any Person or the date the acquired Person
becomes a Subsidiary.
"Annual Debt Service" as of any date means the maximum amount which is
expensed in any 12-month period for interest on Debt of the Company and its
Subsidiaries.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions in The City of New York or in the city in which
the Corporate Trust Office of the Trustee is located, are required or authorized
to close.
"Capital Stock" means, with respect to any Person, any capital stock
(including preferred stock), shares, interests, participation or other ownership
interests (however designated) of such Person and any rights (other than debt
securities convertible into or exchangeable for capital stock), warrants or
options to purchase any thereof.
"Consolidated Income Available for Debt Service" for any period means
Earnings from Operations of the Company and its Subsidiaries plus amounts which
have been deducted, and minus amounts which have been added, for the following
(without duplication): (i) interest on Debt of the
Company and its Subsidiaries, (ii) provision for taxes of the Company and its
Subsidiaries based on income, (iii) amortization of debt discount and deferred
financing costs, (iv) provisions for gains and losses on properties and property
depreciation and amortization, (v) the effect of any noncash charge resulting
from a change in accounting principles in determining Earnings from Operations
for such period and (vi) amortization of deferred charges.
"Debt" of the Company or any Subsidiary means, without duplication, any
indebtedness of the Company or any Subsidiary, whether or not contingent, in
respect of (i) borrowed money or evidenced by bonds, notes, debentures or
similar instruments, (ii) indebtedness for borrowed money secured by any
Encumbrance existing on property owned by the Company or any Subsidiary, (iii)
the reimbursement obligations, contingent or otherwise, in connection with any
letters of credit actually issued (other than letters of credit issued to
provide credit enhancement or support with respect to other indebtedness of the
Company or any Subsidiary otherwise reflected as Debt hereunder) or amounts
representing the balance deferred and unpaid of the purchase price of any
property or services, except any such balance that constitutes an accrued
expense or trade payable, or all conditional sale obligations or obligations
under any title retention agreement, (iv) the principal amount of all
obligations of the Company or any Subsidiary with respect to redemption,
repayment or other repurchase of any Disqualified Stock, or (v) any lease of
property by the Company or any Subsidiary as lessee which is reflected on the
Company's consolidated balance sheet as a capitalized lease in accordance with
GAAP, to the extent, in the case of items of indebtedness under (i) through
(iii) above, that any such items (other than letters of credit) would appear as
a liability on the Company's consolidated balance sheet in accordance with GAAP,
and also includes, to the extent not otherwise included, any obligation by the
Company or any Subsidiary to be liable for, or to pay, as obligor, guarantor or
otherwise (other than for purposes of collection in the ordinary course of
business), Debt of another Person (other than the Company or any Subsidiary) (it
being understood that Debt shall be deemed to be incurred by the Company or any
Subsidiary whenever the Company or such Subsidiary shall create, assume,
guarantee or otherwise become liable in respect thereof).
"Disqualified Stock" means, with respect to any Person, any Capital
Stock of such Person which by the terms of such Capital Stock (or by the terms
of any security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (i) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise
(other than Capital Stock which is redeemable solely in exchange for common
stock or shares), (ii) is convertible into or exchangeable or exercisable for
Debt or Disqualified Stock, or (iii) is redeemable at the option of the holder
thereof, in whole or in part (other than Capital Stock which is redeemable
solely in exchange for common stock or shares), in each case on or prior to the
Stated Maturity of the Notes.
"Earnings from Operations" for any period means net earnings excluding
gains and losses on sales of investments, extraordinary items and property
valuation losses, as reflected in the financial statements of the Company and
its Subsidiaries for such period, determined on a consolidated basis in
accordance with GAAP.
"Encumbrance" means any mortgage, lien, charge, pledge or security
interest of any kind.
-2-
"Exchange Notes" means the senior notes of the Company with terms
substantially identical to the 6 3/4% Senior Notes due December 18, 2002 of the
Company issued in the Exchange Offer made by the Company pursuant to the
Registration Rights Agreement and this Supplemental Indenture.
"Exchange Offer" means the exchange offer registered under the
Securities Act made in accordance with the Registration Rights Agreement
pursuant to which the Company will exchange the Notes for senior notes of the
Company with substantially identical terms.
"Initial Purchaser" means Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated
"Interest Payment Date" means any date interest is paid on the Notes.
"Issuance Date" means the closing date for the sale and original
issuance of the Notes.
"Liquidated Damages" has the meaning set out in the Registration Rights
Agreement.
"Make-Whole Amount" means, in connection with any optional redemption
or accelerated payment of any Note, the excess, if any, of (i) the aggregate
present value as of the date of such redemption or accelerated payment of each
dollar of principal being redeemed or paid and the amount of interest (exclusive
of interest accrued to the date of redemption or accelerated payment) that would
have been payable in respect of such dollar if such redemption or accelerated
payment had not been made, determined by discounting, on a semiannual basis,
such principal and interest at the Reinvestment Rate (determined on the third
Business Day preceding the date such notice of redemption is given or
declaration of acceleration is made) from the respective dates on which such
principal and interest would have been payable if such redemption or accelerated
payment had not been made, over (ii) the aggregate principal amount of the Notes
being redeemed or paid. For purposes of this Supplemental Indenture and the
Notes, references in the Indenture to the payment of the principal (and premium,
if any) and interest on the Notes shall be deemed to include the payment of the
Make-Whole Amount, if any, due upon redemption with respect to the Notes.
"Notes" means the Company's $150,000,000 aggregate principal amount of
6 3/4% Senior Notes, due December 18, 2002, issued under this Indenture
(including, without limitation, any Exchange Notes issued in respect of the
Notes in connection with the Exchange Offer), as amended or supplemented from
time to time.
"Record Date" means the fifteenth calendar day, whether or not a
Business Day, next preceding the applicable Interest Payment Date.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the Issuance Date, by and among the Company and the
Initial Purchaser, as amended or supplemented from time to time.
"Reinvestment Rate" means 0.25% (twenty-five one hundredths of one
percent) plus the yield on treasury securities at constant maturity under the
heading "Week Ending" published in the Statistical Release under the caption
"Treasury Constant Maturities" for the maturity (rounded to the nearest month)
corresponding to the remaining life to maturity, as of the payment date of the
-3-
principal being redeemed or paid. If no maturity exactly corresponds to such
maturity, yields for the two published maturities most closely corresponding to
such maturity shall be calculated pursuant to the immediately preceding sentence
and the Reinvestment Rate shall be interpolated or extrapolated from such yields
on a straight-line basis, rounding in each of such relevant periods to the
nearest month. For purposes of calculating the Reinvestment Rate, the most
recent Statistical Release published prior to the date of determination of the
Make-Whole Amount shall be used.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Regulation S" means Regulation S under the Securities Act.
"Rule 144A" means Rule 144A under the Securities Act, as such Rule may
be amended from time to time, or any similar rule or regulation hereafter
adopted by the SEC.
"SEC" means the Securities and Exchange Commission.
"Secured Debt" means Debt secured by any mortgage, lien, charge, pledge
or security interest of any kind.
"Securities Act" means the Securities Act of 1933, as amended.
"Statistical Release" means the statistical release designated "H.
15(519)" or any successor publication which is published weekly by the Federal
Reserve System and which establishes yields on actively traded United States
government securities adjusted to constant maturities or, if such statistical
release is not published at the time of any determination under this
Supplemental Indenture, then any publicly available source of similar market
data which shall be designated by the Company.
"Subsidiary" means any corporation or other entity of which a majority
of (i) the voting power of the voting equity securities or (ii) the outstanding
equity interests of which are owned, directly or indirectly, by the Company or
one or more other Subsidiaries of the Company. For the purposes of this
definition, "voting equity securities" means equity securities having voting
power for the election of directors, whether at all times or only so long as no
senior class of security has such voting power by reason of any contingency.
"Total Assets" as of any date means the sum of (i) the Undepreciated
Real Estate Assets and (ii) all other assets of the Company and its Subsidiaries
determined in accordance with GAAP (but excluding accounts receivable and
intangibles).
"Total Unencumbered Assets" means the sum of (i) those Undepreciated
Real Estate Assets not subject to an Encumbrance for borrowed money and (ii) all
other assets of the Company and its Subsidiaries not subject to an Encumbrance
for borrowed money determined in accordance with GAAP (but excluding accounts
receivable and intangibles).
"Undepreciated Real Estate Assets" as of any date means the cost
(original cost plus capital improvements) of real estate assets of the Company
and its Subsidiaries on such date, before depreciation and amortization
determined on a consolidated basis in accordance with GAAP.
-4-
"Unsecured Debt" means Debt which is not secured by any of the
properties of the Company or any Subsidiary.
ARTICLE 2
TERMS OF THE NOTES
Section 2.1 Pursuant to Section 3.1 of the Indenture, the Notes shall
have the following terms and conditions:
(a) Title; Limitation on Aggregate Principal Amount; Form of Notes. The
Notes shall be known as the Company's $150,000,000 6 3/4% Senior Notes due
December 18, 2002. The Notes will be limited to an aggregate principal amount of
$150,000,000. The Notes (together with the Trustee's certificate of
authentication) shall be substantially in the form of Exhibit A hereto (with the
appropriate legend or legends placed thereon), which is hereby incorporated in
and made a part of this Supplemental Indenture.
Notes offered and sold in offshore transactions in reliance on
Regulation S will be issued initially in the form of a permanent global
certificate in fully registered form without interest coupons substantially in
the form as above provided (the "Unrestricted Global Note"), and will be
registered in the name of a nominee of DTC and deposited with the Trustee as
custodian for DTC. On or prior to the 40th day after the later of the
commencement of the offering of the Notes and the Issuance Date (which date
shall be certified to the Trustee in an Officer's Certificate), beneficial
interests in the Unrestricted Global Note may be held only through Euroclear or
CEDEL. Beginning 41 days after the later of the commencement of the offering of
the Notes and the Issuance Date (but not earlier), such interests may also be
held through organizations other than Euroclear and CEDEL that are participants
in the DTC system.
Notes offered and sold in reliance on Rule 144A will be issued
initially in the form of a permanent global certificate in fully registered form
without interest coupons substantially in the form as above provided (the
"Restricted Global Note" and, together with the Unrestricted Global Note, the
"Global Notes") and will be registered in the name of a nominee of DTC and
deposited with the Trustee as custodian for DTC. The Notes sold to other
investors in the United States will be issued initially in the form of
individual certificates in fully registered form, without coupons. On or prior
to the 40th day after the later of the commencement of the offering of the Notes
and the Issuance Date, a beneficial interest in the Unrestricted Global Note may
be transferred to a Person who takes delivery in the form of an interest in the
Restricted Global Note only upon receipt by the Trustee of a written
certification from the transferor to the effect that such transfer is being made
to a Person whom the transferor reasonably believes to be a QIB purchasing Notes
for its own account or an account with respect to which it exercises sole
investment discretion in a transaction meeting the requirements of Rule 144A and
in accordance with any applicable securities laws of any state of the United
States or any other jurisdiction (a "Restricted Global Note Certification").
After such 40th day, such certification requirement will no longer apply to such
transfers. Beneficial interests in the Restricted Global Note may be transferred
to a Person who takes delivery in the form of an interest in the Unrestricted
Global Note, whether before, on or after such 40th day, only upon receipt by the
Trustee of a written certification from the transferor to the effect that such
transfer is
-5-
being made in accordance with Rule 903 or 904 of Regulation S or Rule 144 under
the Securities Act (an "Unrestricted Global Note Certification"). Any beneficial
interest in one of the Global Notes that is transferred to a Person who takes
delivery in the form of an interest in the other Global Note will, upon
transfer, cease to be an interest in such Global Note and will become an
interest in the other Global Note and, accordingly, will thereafter be subject
to all transfer restrictions and other procedures and restrictions applicable to
beneficial interests in such other Global Note for as long as it remains such an
interest.
Ownership of beneficial interests in a Global Note will be limited to
Persons who have accounts with DTC ("DTC Participants") or Persons who hold
interests through DTC Participants. Ownership of beneficial interests in the
Global Notes will be shown on, and the transfer of that ownership will be
effected only through, records maintained by DTC or its nominee (with respect to
interests of DTC Participants) and the records of DTC Participants (with respect
to interests of Persons other than DTC Participants).
Individual definitive Notes issued in exchange for the Restricted
Global Note will bear, and be subject to, such legend as the Company requires in
order to assure compliance with any applicable law (which requirement shall be
evidenced by delivery to the Trustee of a Company Order setting forth such
legend). The holder of a restricted individual definitive Note may transfer such
Note, subject to compliance with the provisions of the legend as provided in
paragraph (d) below. Upon the transfer, exchange or replacement of Notes bearing
the legend, or upon specific request for removal of the legend on a Note, the
Company will deliver and the Trustee will authenticate only Notes that bear such
legend, or will refuse to remove such legend, as the case may be, unless there
is delivered to the Company such satisfactory evidence, which may include an
opinion of counsel, as may reasonably be required by the Company, that neither
the legend nor the restrictions on transfer set forth therein are required to
ensure compliance with the provisions of the Securities Act. Before any
individual definitive Note may be transferred to a Person who takes delivery in
the form of an interest in any Global Note, the transferor will be required to
provide the Trustee with a Restricted Global Note Certification or Unrestricted
Global Note Certification, as the case may be.
(b) Principal Repayment; Currency. The Stated Maturity of the Notes is
December 18, 2002, provided, however, the Notes may be earlier redeemed at the
option of the Company as provided in paragraph (c) below. The principal of each
Note payable on its maturity date shall be paid against presentation and
surrender thereof at the Corporate Trust Office of the Trustee, located
initially at Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, in such coin
or currency of the United States of America as at the time of payment is legal
tender for the payment of public or private debts. The Company will not pay
Additional Amounts (as defined in the Indenture) on the Notes.
(c) Redemption at the Option of the Company. Prior to September 18,
2002, the Notes will be subject to redemption at any time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 day's
notice to each Holder of Notes to be redeemed at its address appearing in the
Security Register, at a price equal to the sum of (i) the principal amount of
the Notes being redeemed, plus accrued and unpaid interest and Liquidated
Damages, if any, to but excluding the applicable redemption date and (ii) the
Make-Whole Amount. On and after September 18, 2002, the Notes will be subject to
redemption at any time at the option of the Company, in whole
-6-
or in part, upon not less than 30 nor more than 60 days' notice, at a redemption
price equal to the sum of the principal amount of the Notes being redeemed plus
accrued and unpaid interest and Liquidated Damages, if any, to but excluding the
applicable redemption date.
(d) Restrictive Legends. Unless and until a Note is exchanged for an
Exchange Note in connection with an effective registration pursuant to the
Registration Rights Agreement, each Note shall bear the following legend on the
face thereof:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND SUCH SECURITY MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT (1) TO THE
COMPANY, (2) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QUALIFIED INSTITUTIONAL BUYER WITHIN THE MEANING OF RULE 144A UNDER THE
SECURITIES ACT IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
(3) IN AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 903 OR RULE 904
OF REGULATION S UNDER THE SECURITIES ACT, (4) PURSUANT TO AN EXEMPTION
FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF
AVAILABLE), OR (5) IN A TRANSACTION OTHERWISE EXEMPT FROM THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT, IN EACH CASE IN
ACCORDANCE WITH ANY OTHER APPLICABLE LAW.
TRANSFERS AND EXCHANGES OF THIS SECURITY ARE SUBJECT TO RESTRICTIONS AS
PROVIDED IN THE INDENTURE.
Each Global Note, whether or not an Exchange Note, shall bear the
following legend on the face thereof:
UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE
COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT,
AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH
OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND
ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE
OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN
INTEREST HEREIN.
(e) Notices. All notices and other communications hereunder shall be in
writing and shall be deemed to have been duly given if mailed or transmitted by
any standard form of telecommunication. Notices to the Company shall be directed
to it at 000 Xxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Xxxxx X.
Xxxxxxx, President; notices to the Trustee shall be directed to it at Xxx
Xxxxxxxxxxxxx Xxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000, Attention: Corporate Trust
Department Re: Health and Retirement Properties Trust 6 3/4% Senior Notes due
December 18, 2002.
-7-
ARTICLE 3
ADDITIONAL COVENANTS
Section 3.1 In addition to the covenants of the Company set forth in
Article Ten of the Indenture, for the benefit of the holders of the Notes:
(a) Limitations on Incurrence of Debt.
(i) The Company will not, and will not permit any Subsidiary
to, incur any Debt if, immediately after giving effect to the
incurrence of such additional Debt and the application of the proceeds
thereof, the aggregate principal amount of all outstanding Debt of the
Company and its Subsidiaries on a consolidated basis determined in
accordance with GAAP is greater than 60% of the sum ("Adjusted Total
Assets") of (without duplication) (i) the Total Assets of the Company
and its Subsidiaries as of the end of the calendar quarter covered in
the Company's Annual Report on Form 10-K, or the Quarterly Report on
Form 10-Q, as the case may be, most recently filed with the Securities
and Exchange Commission (or, if such filing is not permitted under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), with
the Trustee) prior to the incurrence of such additional Debt and (ii)
the purchase price of any real estate assets or mortgages receivable
acquired, and the amount of any securities offering proceeds received
(to the extent that such proceeds were not used to acquire real estate
assets or mortgages receivable or used to reduce Debt), by the Company
or any Subsidiary since the end of such calendar quarter, including
those proceeds obtained in connection with the incurrence of such
additional Debt.
(ii) In addition to the foregoing limitations on the
incurrence of Debt, the Company will not, and will not permit any
Subsidiary to, incur any Secured Debt if, immediately after giving
effect to the incurrence of such additional Secured Debt and the
application of the proceeds thereof, the aggregate principal amount of
all outstanding Secured Debt of the Company and its Subsidiaries on a
consolidated basis is greater than 40% of Adjusted Total Assets.
(iii) In addition to the foregoing limitations on the
Incurrence of Debt, the Company will not, and will not permit any
Subsidiary to, incur any Debt if the ratio of Consolidated Income
Available for Debt Service to the Annual Debt Service for the four
consecutive fiscal quarters most recently ended prior to the date on
which such additional Debt is to be incurred shall have been less than
1.5x, on a pro forma basis after giving effect thereto and to the
application of the proceeds therefrom, and calculated on the assumption
that (i) such Debt and any other Debt incurred by the Company and its
Subsidiaries since the first day of such four-quarter period and the
application of the proceeds therefrom, including to refinance other
Debt, had occurred at the beginning of such period; (ii) the repayment
or retirement of any other Debt by the Company and its Subsidiaries
since the first date of such four-quarter period had been repaid or
retired at the beginning of such period (except that, in making such
computation, the amount of Debt under any revolving credit facility
shall be computed based upon the average daily balance of such Debt
during such period); (iii) in the case of Acquired Debt or Debt
incurred in connection with any acquisition since the first day
-8-
of such four-quarter period, the related acquisition had occurred as of
the first day of such period with appropriate adjustments with respect
to such acquisition being included in such pro forma calculation; and
(iv) in the case of any acquisition or disposition by the Company or
its Subsidiaries of any asset or group of assets since the first day of
such four-quarter period, whether by merger, stock purchase or sale, or
asset purchase or sale, such acquisition or disposition or any related
repayment of Debt had occurred as of the first day of such period with
the appropriate adjustments with respect to such acquisition or
disposition being included in such pro forma calculation.
(b) Maintenance of Total Unencumbered Assets. The Company and its
Subsidiaries will maintain Total Unencumbered Assets of not less than 200% of
the aggregate outstanding principal amount of the Unsecured Debt of the Company
and its Subsidiaries on a consolidated basis.
(c) Applicability of Discharge, Defeasance and Covenant Defeasance
Provisions. The Discharge, Defeasance and Covenant Defeasance provisions in
Article Fourteen of the Indenture will apply to the Notes.
ARTICLE 4
ADDITIONAL EVENTS OF DEFAULT
For purposes of this Supplemental Indenture and the Notes, in addition
to the Events of Default set forth in Section 5.1 of the Indenture, it shall
also constitute an "Event of Default" if an event of default under any bond,
debenture, note or other evidence of indebtedness of the Company (including an
event of default with respect to any other series of securities), or under any
mortgage, indenture or other instrument of the Company under which there may be
issued or by which there may be secured or evidenced any indebtedness of the
Company (or by any Subsidiary, the repayment of which the Company has guaranteed
or for which the Company is directly responsible or liable as obligor or
guarantor), whether such indebtedness now exists or shall hereafter be created,
shall happen and shall result in an aggregate principal amount exceeding
$20,000,000 becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable, without such indebtedness
having been discharged, or such acceleration having been rescinded or annulled,
within a period of ten days after there shall have been given, by registered or
certified mail, to the Company by the Trustee or to the Company and the Trustee
by the holders of at least 25% in principal amount of the outstanding Notes, a
written notice specifying such default and requiring the Company to cause such
indebtedness to be discharged or cause such acceleration to be rescinded or
annulled and stating that such notice is a "Notice of Default" hereunder.
ARTICLE 5
EFFECTIVENESS
This Supplemental Indenture shall be effective for all purposes as of
the date and time this Supplemental Indenture has been executed and delivered by
the Company and the Trustee in accordance with Article Nine of the Indenture. As
supplemented hereby, the Indenture is hereby confirmed as being in full force
and effect.
-9-
ARTICLE 6
MISCELLANEOUS
Section 6.1 In the event any provision of this Supplemental Indenture
shall be held invalid or unenforceable by any court of competent jurisdiction,
such holding shall not invalidate or render unenforceable any other provision
hereof or any provision of the Indenture.
Section 6.2 To the extent that any terms of the Notes are inconsistent
with the terms of the Indenture, the terms of the Notes shall govern and
supersede such inconsistent terms.
Section 6.3 This Supplemental Indenture shall be governed by and
construed in accordance with the laws of The Commonwealth of Massachusetts.
Section 6.4 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.
-10-
IN WITNESS WHEREOF, the Company and the Trustee have caused this
Supplemental Indenture to be executed as an instrument under seal in their
respective corporate names as of the date first above written.
HEALTH AND RETIREMENT PROPERTIES TRUST
By: /s/ Xxxxx X. Xxxxxxx
Name: Xxxxx X. Xxxxxxx
Title: President
STATE STREET BANK AND TRUST COMPANY,
as Trustee
By: /s/ Xxxxxx X. Xxxx XX
Name: Xxxxxx X. Xxxx XX
Title: Vice President
-11-
EXHIBIT A
(Face of Note)
6 3/4% Senior Notes due December 18, 2002
No. $__________
HEALTH AND RETIREMENT PROPERTIES TRUST
promises to pay to _______________________________________ or registered
assigns, the principal sum of _____________________________________ Dollars on
December 18, 2002.
Interest Payment Dates: June 18 and December 18.
Record Dates: June 3 and December 3.
CUSIP Nos.: [000000XX0 (Rule 144A)
000000XX0 (Accredited Investor)
U40488 AC 9 (Regulation S)]
HEALTH AND RETIREMENT PROPERTIES
TRUST
By:____________________________________
Name:
Title:
[SEAL]
Dated:
This is one of the Notes referred to in the within-mentioned Indenture:
STATE STREET BANK AND TRUST COMPANY, as Trustee
By:
Authorized Signatory
A - 1
(Back of Note)
HEALTH AND RETIREMENT PROPERTIES TRUST
6 3/4% Senior Notes due December 18, 2002
Capitalized terms used herein have the meanings assigned to them in the
Indenture (as defined below) unless otherwise indicated.
1. Interest. Health and Retirement Properties Trust, a Maryland real
estate investment trust (the "Company"), promises to pay interest on the
principal amount of this Note at the rate and in the manner specified below.
The Company shall pay in cash interest on the principal amount of this
Note at the rate per annum of 6 3/4%. The Company will pay interest
semi-annually in arrears on June 18 and December 18 of each year, commencing on
June 18, 1998 or if any such day is not a Business Day (as defined in the
Indenture), on the next succeeding Business Day (each an "Interest Payment
Date"), to Holders of record on the immediately preceding June 3 and December 3.
Interest will be computed on the basis of a 360-day year consisting of
twelve 30-day months. Interest shall accrue from the most recent date to which
interest has been paid or, if no interest has been paid, from the date of the
original issuance of the Notes.
2. Method of Payment. The Company will pay interest on the Notes
(except defaulted interest) to the Persons who are registered Holders of Notes
at the close of business on the record date next preceding the Interest Payment
Date, even if such Notes are canceled after such record date and on or before
such Interest Payment Date. 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, premium, if
any, and interest by check payable in such money. It may mail an interest check
to a Holder's registered address.
3. Indenture. The Company issued the Notes under an Indenture and a
Supplemental Indenture, each dated as of December 18, 1997 (the "Indenture")
between the Company and the Trustee. The terms of the Notes 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 xx.xx. 77aaa-77bbbb) as in effect on the
date of the Indenture. The Notes are subject to all such terms, and Holders of
the Notes are referred to the Indenture and such act for a statement of such
terms. The terms of the Indenture shall govern any inconsistencies between the
Indenture and the Notes. The Notes are unsecured general obligations of the
Company limited to $150,000,000 in aggregate principal amount.
4. Optional Redemption. Prior to September 18, 2002, the Notes will be
subject to redemption at any time at the option of the Company, in whole or in
part, upon not less than 30 nor more than 60 days' notice, at a redemption price
equal to the sum of (i) the principal amount of the Notes being redeemed, plus
accrued and unpaid interest and Liquidated Damages (as defined in the
Supplemental Indenture), if any, to but excluding the applicable redemption date
and (ii) the Make- Whole Amount. On and after September 18, 2002, the Notes will
be subject to redemption at any time at the option of the Company, in whole or
in part, upon not less than 30 nor more than 60 days'
A - 2
notice, at a redemption price equal to the sum of (i) the principal amount of
the Notes being redeemed, plus accrued and unpaid interest and Liquidated
Damages, if any, to but excluding the applicable redemption date.
As used herein the term "Make-Whole Amount" means, in connection with
any optional redemption or accelerated payment of any Note, the excess, if any,
of (i) the aggregate present value as of the date of such redemption or
accelerated payment of each dollar of principal being redeemed or paid and the
amount of interest (exclusive of interest accrued to the date of redemption or
accelerated payment) that would have been payable in respect of such dollar if
such redemption or accelerated payment had not been made, determined by
discounting, on a semiannual basis, such principal and interest at the
Reinvestment Rate (as defined herein) (determined on the third Business Day
preceding the date such notice of redemption is given or declaration of
acceleration is made) from the respective dates on which such principal and
interest would have been payable if such redemption or accelerated payment had
not been made, over (ii) the aggregate principal amount of the Notes being
redeemed or paid.
As used herein the term "Reinvestment Rate" means 0.25% (twenty-five
one hundredths of one percent) plus the yield on treasury securities at constant
maturity under the heading "Week Ending" published in the Statistical Release
(as defined herein) under the caption "Treasury Constant Maturities" for the
maturity (rounded to the nearest month) corresponding to the remaining life to
maturity, as of the payment date of the principal being redeemed or paid. If no
maturity exactly corresponds to such maturity, yields for the two published
maturities most closely corresponding to such maturity shall be calculated
pursuant to the immediately preceding sentence and the Reinvestment Rate shall
be interpolated or extrapolated from such yields on a straight-line basis,
rounding in each of such relevant periods to the nearest month. For purposes of
calculating the Reinvestment Rate, the most recent Statistical Release published
prior to the date of determination of the Make-Whole Amount shall be used.
As used herein the term "Statistical Release" means the statistical
release designated "H. 15(519)" or any successor publication which is published
weekly by the Federal Reserve System and which establishes yields on actively
traded United States government securities adjusted to constant maturities or,
if such statistical release is not published at the time of any determination
under the Supplemental Indenture, then such other reasonably comparable index
which shall be designated by the Company.
5. Mandatory Redemption. The Company shall not be required to make
sinking fund or redemption payments with respect to the Notes.
6. Notice of Redemption. Notice of redemption shall be mailed at least
30 days but not more than 60 days before the redemption date to each Holder of
Notes to be redeemed at its registered address. Notes may be redeemed in part
but only in whole multiples of $1,000, unless all of the Notes held by a Holder
are to be redeemed. On and after the redemption date, interest ceases to accrue
on Notes or portions of them called for redemption.
7. Denominations, Transfer, Exchange. The Notes are in registered form
without coupons in denominations of $100,000 and integral multiples of $1,000 in
excess thereof. The transfer of Notes may be registered and Notes may be
exchanged as provided in the Indenture. The
A - 3
Registrar and the Trustee 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 exchange
or register the transfer of any Note or portion of a Note selected for
redemption. Also, it need not exchange or register the transfer of any Notes for
a period of 15 days before the mailing of a notice of redemption of Notes, or
during the period between a record date and the corresponding Interest Payment
Date.
8. Defaults and Remedies. In case an Event of Default (as defined in
the Indenture) with respect to the Notes shall have occurred and be continuing,
the principal hereof may be declared, and upon such declaration shall become,
due and payable, in the manner, with the effect and subject to the provisions
provided in the Indenture.
9. Actions of Holders. The Indenture contains provisions permitting the
holders of not less than a majority of the aggregate principal amount of the
outstanding Notes, on behalf of the holders of all such Notes at a meeting duly
called and held as provided in the Indenture, to make, give or take any request,
demand, authorization, direction, notice, consent, waiver or other action
provided in the Indenture to be made, given or taken by the holders of the
Notes, including without limitation, waiving (a) compliance by the Company with
certain provisions of the Indenture, and (b) certain past defaults under the
Indenture and their consequences. Any resolution passed or decision taken at any
meeting of the holders of the Notes in accordance with the provisions of the
Indenture shall be conclusive and binding upon such holders and upon all future
holders of this Note and other Notes issued upon the registration of transfer
hereof or in exchange heretofore or in lieu hereof
10. Persons Deemed Owners. The Company, the Trustee, and any agent of
the Company or the Trustee may deem and treat the Person in whose name this Note
is registered on the Security Register as its absolute owner for all purposes.
11. Authentication. This Note shall not be valid until authenticated by
the manual signature of the Trustee or an authenticating agent.
12. [Holders' Compliance with Registration Rights Agreement.1 Each
Holder of a Note, by his acceptance thereof, acknowledges and agrees to the
provisions of the Registration Rights Agreement, dated as of December 18, 1997
among the Company and the Initial Purchaser (as defined therein) (the
"Registration Rights Agreement"), including but not limited to the obligations
of the Holders with respect to a registration and the indemnification of the
Company and the Initial Purchaser (as defined therein) to the extent provided
therein.]
13. Governing Law. THE INTERNAL LAW OF THE COMMONWEALTH OF
MASSACHUSETTS SHALL GOVERN AND BE USED TO CONSTRUE THE INDENTURE AND THE NOTES.
14. No Personal Liability. THE AMENDED AND RESTATED DECLARATION OF
TRUST OF THE COMPANY, DATED JULY 1, 1994, A COPY OF WHICH, TOGETHER WITH ALL
AMENDMENTS THERETO (THE "DECLARATION"), IS DULY FILED IN
--------
1 This paragraph should be deleted from Exchange Notes.
A - 4
THE OFFICE OF THE DEPARTMENT OF ASSESSMENTS AND TAXATION OF THE STATE OF
MARYLAND, PROVIDES THAT THE NAME "HEALTH AND RETIREMENT PROPERTIES TRUST" REFERS
TO THE TRUSTEES UNDER THE DECLARATION COLLECTIVELY AS TRUSTEES, BUT NOT
INDIVIDUALLY OR PERSONALLY, AND THAT NO TRUSTEE, OFFICER, SHAREHOLDER, EMPLOYEE
OR AGENT OF THE COMPANY SHALL BE HELD TO ANY PERSONAL LIABILITY, JOINTLY OR
SEVERALLY, FOR ANY OBLIGATION OF, OR CLAIM AGAINST, THE COMPANY. ALL PERSONS
DEALING WITH THE COMPANY, IN ANY WAY, SHALL LOOK ONLY TO THE ASSETS OF THE
COMPANY FOR THE PAYMENT OF ANY SUM OR THE PERFORMANCE OF ANY OBLIGATION.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture and/or the Registration Rights Agreement. Request
may be made to:
Health and Retirement Properties Trust
000 Xxxxxx Xxxxxx
Xxxxxx, XX 00000
Telecopier No.: (000) 000-0000
Attention: President
A - 5
ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
(Insert assignee's soc. sec. or tax I.D. no.)
(Print or type assignee's name, address and zip code)
and irrevocably appoint
to transfer this Note on the books of the Company. The agent may substitute
another to act for him.
Date:
Your Signature:
(Sign exactly as your name appears on the
face of this Note)
Signature Guarantee:
