Exhibit 4.3
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CII FINANCIAL, INC.
SIERRA HEALTH SERVICES, INC.
and
CHEMICAL TRUST COMPANY OF CALIFORNIA,
as Trustee
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FIRST SUPPLEMENTAL INDENTURE
Dated as of October 31, 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 31, 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, not in its individual capacity but solely as Trustee (the
"Trustee") under the Indenture (as defined below).
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 (the
"Indenture") 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 California
corporation and 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 par share,
of the Company (the "CII Common Stock") would be converted into 0.370 of a share
of Common Stock, par value $.005 per share, of Sierra (the "Sierra Common
Stock") 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 would 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 Sierra and the Company adopted
Board Resolutions on June 12, 1995 and October 23, 1995, respectively,
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; and
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, in order, 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 1
Amendments to Indenture
Upon the consummation of the Merger and the execution and delivery of
this First Supplemental Indenture to the Trustee, the Indenture shall be amended
as set forth below.
Section 1.1. Amendments to Article 1 of the Indenture.
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(a) The following terms defined in Section 1.1 of the Indenture shall
be amended to read in their entirety as follows:
(i) "Board of Directors," when used with respect to the
Company or Sierra, means the board of directors of the Company or Sierra,
respectively, or any duly authorized committee of the board of directors of the
Company or Sierra, respectively.
(ii) "Board Resolution," when used with respect to the
Company or Sierra, means a copy of a resolution certified by the Secretary or an
Assistant Secretary of the Company or Sierra, respectively, to have been duly
adopted by the Board of Directors and to be in full force and effect on the date
of such certification, and delivered to the Trustee.
(iii) "Common Stock" includes any stock of any class of Sierra
which has no preference in respect of dividends or of amounts payable in the
event of any voluntary or involuntary liquidation, dissolution or winding-up of
Sierra and which is not subject to redemption by Sierra. However, subject to the
provisions of Section 13.4, shares issuable on conversion of Securities shall
include only shares of the class designated as Common Stock of Sierra at the
date of the First Supplemental Indenture or shares of any class or classes
resulting from any reclassification thereof and which have no preference in
respect of dividends or of amounts payable in the event of any voluntary or
involuntary liquidation, dissolution or winding-up of Sierra and which are not
subject to redemption by Sierra; provided, that if at any time there shall be
more
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than one such resulting class, the shares of each such class then so issuable
shall be substantially in the proportion which the total number of shares of
such class resulting from all such reclassifications bears to the total number
of shares of all such classes resulting from all such reclassifications.
(iv) "Subsidiary", when used with respect to the Company or
Sierra, means a corporation more than 50% of the outstanding voting stock of
which is owned, directly or indirectly, by the Company or Sierra, respectively,
or by one or more other Subsidiaries, or by the Company or Sierra, respectively,
and one or more other Subsidiaries. For the purposes of this definition, "voting
stock" means stock which ordinarily has voting power for the election of
directors, whether at all times or only so long as no senior class of stock has
such voting power by reason of any contingency.
(v) "Vice President," when used with respect to the Company,
Sierra or the Trustee, means any vice president so designated by the Board of
Directors of the Company, Sierra or the Trustee, whether or not designated by a
number or a word or words added before or after the title "vice president."
(b) The following terms shall be added to Section 1.1 of the Indenture
in their appropriate alphabetical places:
(i) "First Supplemental Indenture" means the First Supplemental
Indenture, dated as of October 31, 1995, among the Company, Sierra and the
Trustee.
(ii) "Sierra" means Sierra Health Services, Inc., a Nevada
corporation, until a successor replaces it in accordance with the applicable
provisions of this Indenture and thereafter means the successor.
(c) Section 1.5(1) shall be amended to insert the words "or Sierra"
immediately after the words "the Company."
(d) Section 1.5(2) shall be amended to delete the period at the end
thereof and to insert ", or" in its place.
(e) The following Section 1.5(3) shall be added at the end of Section
1.5:
"(3) Sierra by the Trustee or by any Holder shall be sufficient for
every purpose hereunder (unless otherwise herein expressly provided) if in
writing and mailed, first-class postage prepaid, to Sierra addressed to it
at the address of its principal office located at 0000 Xxxxx Xxxxxx Xxx,
Xxx Xxxxx, Xxxxxx
0
00000, or at any other address subsequently furnished in writing to the
Trustee by Sierra."
Section 1.2. Amendments to Article 12 of the Indenture.
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(a) Section 12.2(d) shall be amended to delete the words "the
Company" and insert the word "Sierra" in their place.
(b) The fifth line of Section 12.2(g) shall be amended to delete the
words "the Company" and insert the word "Sierra" in their place.
(c) Section 12.2(h) shall be amended to delete the words "the
Company" and insert the word "Sierra" in their place.
Section 1.3. Amendments to Article 13 of the Indenture. The Holder
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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, and Article
13 shall be amended as follows:
(a) Throughout Article 13, the words "the Company" shall be deleted
and the word "Sierra" shall be inserted in their place, except:
(i) in the third sentence of the first paragraph of
Section 13.1;
(ii) in the first paragraph of Section 13.2; and
(iii) in the third paragraph of Section 13.2;
in which instances such words shall remain "the Company."
(b) In the first sentence of the second paragraph of Section 13.1,
"$21.866" shall be deleted and "$59.097" shall be inserted in its place.
ARTICLE 2
Miscellaneous Provisions
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 of this First Supplemental
Indenture, the Indenture shall be modified and amended in accordance with this
First Supplemental
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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 covenants and agreements in
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this First Supplemental Indenture by the Company, 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 Article and the Section
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headings herein are for convenience only and shall not affect the construction
hereof.
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.
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. Officers' Certificate and Opinion of Counsel. In
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accordance with Section 8.1(3) of the Indenture, the Company shall provide the
Trustee with an Officers' Certificate and Opinion of Counsel for the Company, in
forms reasonably acceptable to the Trustee, that the Merger and this First
Supplemental Indenture comply with the provisions of the Indenture and that all
conditions precedent therein relating to the Merger and this First Supplemental
Indenture have been satisfied.
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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:_______________________________
Attest:
___________________________
SIERRA HEALTH SERVICES, INC.
By:_______________________________
Attest:
___________________________
CHEMICAL TRUST COMPANY OF
CALIFORNIA, as Trustee
By:_______________________________
Attest:
___________________________
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STATE OF CALIFORNIA )
) SS:
COUNTY OF _________________)
On ________________________, before me, ______________________, a
Notary Public in and for said State, personally appeared _____________________,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
(SEAL)
STATE OF CALIFORNIA )
) SS:
COUNTY OF _________________)
On ________________________, before me, ______________________, a
Notary Public in and for said State, personally appeared _____________________,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
(SEAL)
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STATE OF CALIFORNIA )
) SS:
COUNTY OF _________________)
On ________________________, before me, ______________________, a
Notary Public in and for said State, personally appeared _____________________,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
(SEAL)
STATE OF CALIFORNIA )
) SS:
COUNTY OF _________________)
On ________________________, before me, ______________________, a
Notary Public in and for said State, personally appeared _____________________,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
(SEAL)
8
STATE OF CALIFORNIA )
) SS:
COUNTY OF _________________)
On ________________________, before me, ______________________, a
Notary Public in and for said State, personally appeared _____________________,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
(SEAL)
STATE OF CALIFORNIA )
) SS:
COUNTY OF _________________)
On ________________________, before me, ______________________, a
Notary Public in and for said State, personally appeared _____________________,
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person(s) whose name(s) is/are subscribed to the within instrument and
acknowledged to me that he/she/they executed the same in his/her/their
authorized capacity(ies), and that by his/her/their signature(s) on the
instrument the person(s), or the entity upon behalf of which the person(s)
acted, executed the instrument.
WITNESS my hand and official seal.
___________________________________
(SEAL)
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