-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, QWRtmuw9Bz8tcREIp+KB1Yh4pus4bv6ep1cfUZ+eYBpoOcnBsaEqBpse7QpKmRX7 QmEq3oLwzGUxmJ0fds9ChQ== 0001017062-96-000639.txt : 19961202 0001017062-96-000639.hdr.sgml : 19961202 ACCESSION NUMBER: 0001017062-96-000639 CONFORMED SUBMISSION TYPE: S-3 PUBLIC DOCUMENT COUNT: 7 FILED AS OF DATE: 19961127 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: NATIONWIDE HEALTH PROPERTIES INC CENTRAL INDEX KEY: 0000780053 STANDARD INDUSTRIAL CLASSIFICATION: REAL ESTATE INVESTMENT TRUSTS [6798] IRS NUMBER: 953997619 STATE OF INCORPORATION: MD FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-3 SEC ACT: 1933 Act SEC FILE NUMBER: 333-17061 FILM NUMBER: 96674165 BUSINESS ADDRESS: STREET 1: 4675 MACARTHUR COURT STE 1170 CITY: NEWPORT BEACH STATE: CA ZIP: 92660 BUSINESS PHONE: 7142511211 MAIL ADDRESS: STREET 1: 4675 MACARTHUR COURT STREET 2: STE 1170 CITY: NEWSPORT BEACH STATE: CA ZIP: 92660 FORMER COMPANY: FORMER CONFORMED NAME: BEVERLY INVESTMENT PROPERTIES INC DATE OF NAME CHANGE: 19890515 S-3 1 FORM S-3 $300,000,000 INITIAL FILING As filed with the Securities and Exchange Commission on November 27, 1996 Registration No. 333-_____ ================================================================================ SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 ---------------------------- FORM S-3 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 -------------------------- NATIONWIDE HEALTH PROPERTIES, INC. (Exact name of registrant as specified in its charter) Maryland 95-3997619 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 4675 MacArthur Court, Suite 1170 Newport Beach, California 92660 (714) 251-1211 (Address, including zip code, and telephone number, including area code, of registrant's principal executive offices) R. Bruce Andrews Chief Executive Officer and President Nationwide Health Properties, Inc. 4675 MacArthur Court, Suite 1170 Newport Beach, California 92660 (714) 251-1211 (Name, address, including zip code, and telephone number, including area code, of agent for service) Copy To: Gary J. Singer, Esq. O'Melveny & Myers LLP 610 Newport Center Drive, Suite 1700 Newport Beach, CA 92660-6429 ---------------------------- Approximate date of commencement of proposed sale to the public: From time to time after the effective date of this Registration Statement as determined by market conditions. If the only securities being registered on this Form are being offered pursuant to dividend or interest reinvestment plans, check the following box. [_] If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, other than securities offered only in connection with dividend or interest reinvestment plans, check the following box. [X] If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [_] If delivery of the prospectus is expected to be made pursuant to Rule 434, please check the following box. [_] CALCULATION OF REGISTRATION FEE
AMOUNT PROPOSED MAXIMUM PROPOSED MAXIMUM TITLE OF EACH CLASS OF TO BE OFFERING PRICE AGGREGATE AMOUNT OF SECURITIES TO BE REGISTERED REGISTERED PER UNIT OFFERING PRICE REGISTRATION FEE - ------------------------------ ---------------- ---------------- ------------------ ---------------- Debt Securities............... (1)(2) (3) (1)(2) NA Preferred Stock (par value $1.00 per share)....... (1)(4) (3) (1)(3)(4) NA Depositary Shares............. (1)(4)(5) (3) (1)(3)(5) NA Common Stock (par value $0.10 per share)....... (1)(6) (3) (1)(3)(6) NA Securities Warrants (1)(7) (3) (1)(3)(7) NA Total..................... $300,000,000 (3) $300,000,000 $90,910(8) ===============================================================================================================
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933, or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine. ================================================================================ (footnotes) (1) In no event will the aggregate maximum offering price of all securities issued pursuant to this Registration Statement exceed $300,000,000 or, if any Debt Securities are issued with original issue discount, such greater amount as shall result in an aggregate offering price of $300,000,000. Any securities registered hereunder may be sold separately or as units with other securities registered hereunder. (2) Subject to Footnote (1), there is being registered hereunder an indeterminate principal amount of Debt Securities. (3) The proposed maximum offering price per unit will be determined, from time to time, by the Registrant in connection with the issuance by the Registrant of the securities registered hereunder. (4) Subject to Footnote (1), there is being registered hereunder an indeterminate number of shares of Preferred Stock (par value of $1.00 per share) as may be sold, from time to time, by the Registrant. There is also being registered hereunder an indeterminate number of shares of Preferred Stock and Depositary Shares as shall be issuable upon conversion of Debt Securities or exercise of Securities Warrants registered hereby. (5) Subject to Footnote (1), there is being registered hereunder an indeterminate number of Depositary Shares to be issued pursuant to Deposit Agreements. In the event the Registrant elects to offer to the public fractional interests in shares of the Preferred Stock registered hereunder, Depositary Receipts will be distributed to those persons purchasing such fractional interests, and the shares of Preferred Stock will be issued to the Depositary under any such Deposit Agreement. (6) Subject to Footnote (1), there is being registered hereunder an indeterminate number of shares of Common Stock as may be sold, from time to time, by the Registrant. There is also being registered hereunder an indeterminate number of shares of Common Stock as shall be issuable upon conversion of the Preferred Stock or Debt Securities or exercise of Securities Warrants registered hereby. (7) Subject to Footnote (1), there is being registered hereunder an indeterminate number of Debt Securities Warrants, Preferred Stock Warrants, Depositary Shares Warrants and Common Stock Warrants representing rights to purchase Debt Securities, Preferred Stock, Depositary Shares and Common Stock, respectively, registered pursuant to this Registration Statement. (8) Calculated pursuant to Rule 457(o) of the rules and regulations under the Securities Act of 1933, as amended. 2 Prospectus - ---------- NATIONWIDE HEALTH PROPERTIES, INC. Securities Nationwide Health Properties, Inc. (the "Company") may offer from time to time, in one or more series, its unsecured debt securities (the "Debt Securities"), warrants to purchase Debt Securities (the "Debt Securities Warrants"), shares of its Preferred Stock, par value $1.00 per share (the "Preferred Stock"), warrants to purchase Preferred Stock (the "Preferred Stock Warrants"), warrants to purchase Depositary Shares (as defined below) (the "Depositary Shares Warrants"), shares of its Common Stock, par value $0.10 per share (the "Common Stock") and warrants to purchase Common Stock (the "Common Stock Warrants," and with the Debt Securities Warrants, the Preferred Stock Warrants and the Depositary Shares Warrants, being collectively referred to herein as the "Securities Warrants"). The Debt Securities, the Preferred Stock, the Common Stock and the Securities Warrants are collectively referred to herein as the "Securities." The Securities will have an aggregate offering price of $300,000,000 and will be offered on terms to be determined at the time of offering. In the case of Debt Securities, the specific title, the aggregate principal amount, the purchase price, the maturity, the rate and time of payment of any interest, any redemption or sinking fund provisions, any conversion provisions and any other specific term of the Debt Securities will be set forth in the accompanying supplement to this Prospectus (the "Prospectus Supplement"). In the case of Preferred Stock, the specific number of shares, designation, stated value per share, liquidation preference per share, issuance price, dividend rate (or method of calculation), dividend payment dates, any redemption or sinking fund provisions, any conversion rights and other specific terms of the series of Preferred Stock will be set forth in the accompanying Prospectus Supplement. In addition, the Prospectus Supplement will describe whether interests in the Preferred Stock will be represented by depositary shares (the "Depositary Shares") evidenced by depositary receipts. In the case of Common Stock, the specific number of shares and issuance price per share will be set forth in the accompanying Prospectus Supplement. In the case of Securities Warrants, the duration, offering price, exercise price and detachability, if applicable, will be set forth in the accompanying Prospectus Supplement. The Prospectus Supplement will also disclose whether the Securities will be listed on a national securities exchange and if they are not to be listed, the possible effects thereof on their marketability. Securities may be sold directly, through agents from time to time or through underwriters or dealers. If any agent of the Company or any underwriter is involved in the sale of the Securities, the name of such agent or underwriter and any applicable commission or discount will be set forth in the accompanying Prospectus Supplement. See "Plan of Distribution." The net proceeds to the Company from such sale also will be set forth in the applicable Prospectus Supplement. The Debt Securities, if issued, may rank on parity with all other unsecured and unsubordinated indebtedness of the Company or may be subordinated to certain other indebtedness of the Company. See "Description of Debt Securities." __________________________________ THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. __________________________________ THE ATTORNEY GENERAL OF THE STATE OF NEW YORK HAS NOT PASSED ON OR ENDORSED THE MERITS OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS UNLAWFUL. ___________________________________ This Prospectus may not be used to consummate sales of Securities unless accompanied by a Prospectus Supplement. ___________________________________ The date of this Prospectus is November 27, 1996 1 AVAILABLE INFORMATION The Company is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act") and, in accordance therewith, files reports, proxy statements and other information with the Securities and Exchange Commission (the "Commission"). Such reports, proxy statements and other information can be inspected and copied at the Public Reference Room of the Commission, Room 1024, at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices at 7 World Trade Center, 13th Floor, New York, New York 10048 and Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such material can be obtained by mail from the Public Reference Section of the Commission at 450 Fifth Street, N.W., Room 1024, Washington, D.C. 20549 at prescribed rates. In addition, such materials may also be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New York, New York 10005. The Company has filed with the Commission a Registration Statement on Form S-3 (together with all amendments and exhibits thereto, the "Registration Statement") under the Securities Act of 1933, as amended (the "Securities Act"). This Prospectus and any accompanying Prospectus Supplement do not contain all of the information set forth in the Registration Statement, certain parts of which are omitted in accordance with the rules and regulations of the Commission. For further information, reference is made to the Registration Statement, which may be examined without charge at the public reference facilities maintained by the Commission at the Public Reference Room of the Commission, Room 1024, 450 Fifth Street, N.W., Washington, D.C. 20549. Copies thereof may be obtained from the Commission upon payment of the prescribed fees. ____________________________________ INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE The Company's Annual Report on Form 10-K for the fiscal year ended December 31, 1995 and its Quarterly Reports on Form 10-Q for the quarters ended March 31, 1996, June 30, 1996 and September 30, 1996 are incorporated in and made a part of this Prospectus. All documents filed by the Company with the Commission pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to the termination of the offering of the Securities shall be deemed to be incorporated by reference herein and to be a part hereof from the date of filing such documents. A statement contained herein, in a Prospectus Supplement or in a document incorporated or deemed to be incorporated by reference herein, shall be deemed to be modified or superseded for purposes of this Prospectus to the extent that a statement contained herein, in a Prospectus Supplement or in any subsequently filed document which is incorporated by reference herein, modifies or supersedes such statement. Any such statements so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Prospectus. The Company will provide without charge to each person to whom this Prospectus is delivered, on the request of any such person, a copy of any or all the documents incorporated herein by reference (other than exhibits to such documents, unless such exhibits are specifically incorporated by reference into the documents that this Prospectus incorporates). Requests for such copies should be directed to Nationwide Health Properties, Inc., 4675 MacArthur Court, Suite 1170, Newport Beach, California 92660, Attention: Mark L. Desmond (telephone number (714) 251-1211). 2 THE COMPANY Nationwide Health Properties, Inc., a Maryland corporation organized in October 1985 (the "Company"), is a real estate investment trust ("REIT") which invests primarily in health care related facilities and provides financing to health care providers. As of September 30, 1996, the Company had investments in 224 facilities located in 30 states. The facilities include 182 long-term health care facilities, 40 assisted living facilities and two rehabilitation hospitals. As of September 30, 1996, the Company had direct ownership of 139 long-term health care facilities, 35 assisted living facilities and two rehabilitation hospitals. All of the Company's owned facilities are leased under "net" leases (the "Leases"), which are accounted for as operating leases, to 35 health care providers (the "Lessees") including Beverly Enterprises, Inc. ("Beverly"), ARV Assisted Living, Inc., Sun Healthcare Group, Inc., Horizon/CMS Healthcare Corporation, Living Centers of America, Inc., GranCare Inc., Integrated Health Services, Inc., HEALTHSOUTH Corporation, Alternative Living Services, Inc., Mariner Health Group, and Retirement Care Associates, Inc. Of the Lessees, only Beverly and ARV Assisted Living, Inc. account for more than 10% of the Company's revenue. The Leases have initial terms ranging from 10 to 19 years, and generally the Leases have two or more multi-year renewal options. The Company earns fixed monthly minimum rents and may earn periodic additional rents. The additional rent payments are generally computed as a percentage of facility net patient revenues in excess of base amounts. The base amounts, in most cases, are net patient revenues for the first year of the lease. Most Leases contain cross collateralization and cross default provisions tied to other Leases with the same Lessee, as well as grouped lease renewals and grouped purchase options. Obligations under the Leases have corporate guarantees, and Leases covering 94 facilities are backed by irrevocable letters of credit or security deposits which cover one to 12 months of monthly minimum rents. Under the terms of the Leases, the Lessee is responsible for all maintenance, repairs, taxes and insurance on the leased properties. As of September 30, 1996, the Company held 29 mortgage loans secured by 43 long-term health care facilities and 5 assisted living facilities. As of September 30, 1996, the mortgage loans had a net book value of approximately $155,507,000 with individual outstanding balances ranging from approximately $754,000 to $17,250,000 and maturities ranging from 1998 to 2031. As of September 30, 1996, 45 of the Company's 176 owned facilities were being leased to and operated by subsidiaries of Beverly. Beverly has guaranteed certain obligations of its subsidiaries and of certain parties unaffiliated with Beverly in connection with 24 properties operated by such parties. Rental and interest income from Beverly accounted for 40%, 34% and 27% of the Company's total revenues for the years ended December 31, 1993, 1994 and 1995, respectively, and for 23% of the Company's total revenues for the nine months ended September 30, 1996. The Company anticipates providing lease or mortgage financing for health care facilities to qualified operators and acquiring additional health care related facilities, including long-term health care facilities, assisted living facilities, acute care hospitals and medical office buildings. Financing for such future investment may be provided by borrowings under the Company's bank line of credit, private placements or public offerings of debt or equity, and the assumption of indebtedness. The Company operates so as to qualify as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code"). As a REIT, the Company distributes to its stockholders substantially all of its cash flow from operations and, in any event, at least 95% of its taxable income. If the Company qualifies for taxation as a REIT, it will generally not be subject to federal corporate income taxes on its net income that is currently distributed to stockholders. This treatment substantially eliminates the "double taxation" (e.g., at the corporate and stockholder levels) that generally results from investment in stock of a corporation. The Company's principal executive offices are located at 4675 MacArthur Court, Suite 1170, Newport Beach, California 92660 and its telephone number is (714) 251-1211. 3 SELECTED CONSOLIDATED FINANCIAL INFORMATION The following selected consolidated financial information of the Company, restated for the two-for-one stock split effective March 8, 1996, for each of the five years ended December 31, 1995 is derived from the Company's audited consolidated financial statements, which have been audited by Arthur Andersen LLP, independent accountants. The selected consolidated financial information for the nine month periods ended September 30, 1996 and 1995 has been derived from the unaudited interim consolidated financial statements of the Company and includes, in the opinion of management, all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the financial position and results of operations as of and for such periods. Such financial information has been derived from financial information included in the Company's Annual Reports on Form 10-K and the Company's Quarterly Reports on Form 10-Q. The selected consolidated financial information set forth below should be read in conjunction with the detailed information, consolidated financial statements and related notes and applicable "Management's Discussion and Analysis" included in the 1995, 1994, 1993, 1992 and 1991 Annual Reports on Form 10-K.
NINE MONTHS ENDED SEPTEMBER 30, YEAR ENDED DECEMBER 31, ---------------------- ------------------------------------------------------------- 1996 1995 1995 1994 1993 1992 1991 --------- ---------- ------------ ------------ ---------- ---------- --------- OPERATING DATA: (IN THOUSANDS, EXCEPT PER SHARE DATA) Revenues: Minimum rent............................... $ 49,431 $ 39,947 $ 54,504 $ 47,805 $ 40,758 $ 38,062 $ 31,439 Additional rent and additional interest...................... 8,862 8,909 11,776 9,767 8,417 6,241 4,063 Interest and other income 12,242 10,826 14,759 12,413 11,210 5,504 876 --------- --------- --------- ----------- --------- --------- -------- 70,535 59,682 81,039 69,985 60,385 49,807 36,378 Expenses: Depreciation and non- cash charges............................. 12,454 10,246 13,885 12,244 10,115 9,219 7,585 Interest and amortization of deferred financing costs................. 15,539 10,525 14,628 9,921 6,186 8,162 4,849 General and administrative................. 2,499 2,356 3,144 3,007 3,088 2,883 2,403 --------- --------- --------- ----------- --------- --------- -------- 30,492 23,127 31,657 25,172 19,389 20,264 14,837 --------- --------- --------- ----------- --------- --------- -------- Income from operations...................... 40,043 36,555 49,382 44,813 40,996 29,543 21,541 Gain on sale of facilities.................. -- 989 989 -- -- 138 -- Extraordinary charge(1)..................... -- -- -- -- (2,004) -- (3,460) --------- --------- --------- ----------- --------- --------- -------- Net income.................................. $ 40,043 $ 37,544 $ 50,371 $ 44,813 $ 38,992 $ 29,681 $ 18,081 ========= ========= ========= =========== ========= ========= ======== Dividends paid.............................. $ 44,121 $ 39,145 $ 53,182 $ 47,751 $ 42,883 $ 33,349 $ 26,245 PER SHARE DATA: Income from operations...................... $1.00 $.97 $1.31 $1.23 $1.17 $.99 $.84 Net income.................................. 1.00 1.00 1.33 1.23 1.11 1.00 .70 Dividends paid.............................. 1.11 1.05 1.41 1.31 1.21 1.11 1.03 BALANCE SHEET DATA: Investments in real estate, net............. $700,490 $557,375 $ 652,231 $501,862 $428,473 $380,539 $289,761 Total assets................................ 723,661 572,094 670,111 513,809 440,165 396,664 305,837 Senior unsecured notes due 2000-2015........ 150,000 56,000 100,000 -- -- -- -- Bank borrowings............................. 48,200 48,700 93,900 80,200 3,800 9,950 -- Convertible debentures...................... 65,000 65,000 65,000 67,690 73,609 44,455 50,000 Notes and bonds payable..................... 9,249 14,190 23,364 20,520 23,047 32,116 33,124 Stockholders' equity........................ 428,963 372,903 371,822 336,106 332,927 301,895 218,772 OTHER DATA: Net cash provided by operating activities... 54,960 51,066 66,972 56,756 49,725 38,207 30,217 Net cash used in investing activities....... (59,252) (62,820) (151,476) (83,185) (56,261) (96,719) (55,899) Net cash provided by financing activities... 6,429 14,051 88,699 26,544 1,882 56,837 32,365 Funds from operations (2)................... $ 52,497 $ 46,801 $ 63,267 $ 57,057 $ 51,111 $ 38,762 $ 29,126 Weighted average shares outstanding......... 39,899 37,500 37,808 36,356 35,188 29,734 25,674 __________________________
(1) The Company incurred extraordinary charges representing the write-off of unamortized deferred financing costs and fees in connection with the prepayment of substantial portions of the Company's secured debt. (2) Industry analysts generally consider funds from operations to be an alternative measure of the performance of an equity REIT. The Company therefore discloses funds from operations, although it is a measurement that is not defined by generally accepted accounting principles. The 4 Company uses the NAREIT measure of funds from operations, which is generally defined as income before extraordinary items plus certain non- cash items, primarily depreciation, less gains on sales of facilities. The NAREIT measure may not be comparable to similarly titled measures used by other REITs. Consequently, the Company's funds from operations may not provide a meaningful measure of the Company's performance as compared to that of other REITs. Funds from operations does not represent cash generated from operating activities as defined by generally accepted accounting principles (funds from operations does not include changes in operating assets and liabilities) and, therefore, should not be considered as an alternative to net income as the primary indicator of operating performance or to cash flow as a measure of liquidity. RATIO OF EARNINGS TO FIXED CHARGES
Nine Months Ended Year Ended December 31, September 30, ---------------------------------- --------------- 1991 1992 1993 1994 1995 1996 ---- ---- ---- ---- ---- ---- Ratio... 5.44 4.64 7.63 5.52 4.57 3.58
USE OF PROCEEDS Unless otherwise specified in the Prospectus Supplement which accompanies this Prospectus, the net proceeds from the sale of the Securities offered from time to time hereby will be used for general corporate purposes, including the repayment of bank lines of credit and investments in health care related properties. The Company uses its existing revolving bank credit facility primarily to provide financing for the acquisitions of health care related facilities. To the extent that the Company has amounts outstanding under the credit facility at the time it issues Securities, it is currently required to use the proceeds of such issuance to repay amounts outstanding under the credit facility. DESCRIPTION OF DEBT SECURITIES Debt Securities may be issued from time to time in series under an Indenture (the "Indenture") to be entered into between the Company and The Bank of New York, as Trustee (the "Trustee"). As used under this caption, unless the context otherwise requires, Offered Debt Securities shall mean the Debt Securities offered by this Prospectus and the accompanying Prospectus Supplement. The statements under this caption are brief summaries of certain provisions contained in the Indenture, do not purport to be complete and are qualified in their entirety by reference to the Indenture, including the definition therein of certain terms, a copy of which is filed as an exhibit to the Registration Statement of which this Prospectus is a part. The following sets forth certain general terms and provisions of the Debt Securities. Further terms of the Offered Debt Securities will be set forth in the Prospectus Supplement. GENERAL The Indenture provides for the issuance of Debt Securities in series, and does not limit the principal amount of Debt Securities which may be issued thereunder. Reference is made to the Prospectus Supplement for the following terms of the Offered Debt Securities: (1) the specific title of the Offered Debt Securities; (2) the aggregate principal amount of the Offered Debt Securities; (3) the percentage of their principal amount at which the Offered Debt Securities will be issued; (4) the date on which the Offered Debt Securities will mature; (5) the rate or rates per annum or the method for determining such rate or rates, if any, at which the Offered Debt Securities will bear interest; (6) the times at which any such interest will be payable; (7) any provisions relating to optional or mandatory redemption of the Offered Debt Securities at the option of the Company or pursuant to sinking fund or analogous provisions; (8) the denominations in which the Offered Debt Securities are authorized to be issued; (9) any provisions relating to the conversion or exchange of the Offered Debt Securities into Common Stock, Preferred Stock or 5 into Debt Securities of another series; (10) whether the Offered Debt Securities are to be issued in fully registered form without coupons or in bearer form with interest coupons or both; (11) the place or places at which the Company will make payments of principal (and premium, if any) and interest, if any, and the method of payment; (12) whether the Offered Debt Securities will be issued in whole or in part in global form; (13) any additional covenants and Events of Default and the remedies with respect thereto not currently set forth in the Indenture; (13) whether the Offered Debt Securities will be subordinated to other indebtedness of the Company; and (14) any other specific terms of the Offered Debt Securities. One or more series of the Debt Securities may be issued as discounted Debt Securities (bearing no interest or bearing interest at a rate which at the time of issuance is below market rates) to be sold at a substantial discount below their stated principal amount. Tax and other special considerations applicable to any such discounted Debt Securities will be described in the Prospectus Supplement relating thereto. STATUS OF DEBT SECURITIES The Debt Securities will be unsecured obligations of the Company and may be ranking on a parity with all other unsecured and unsubordinated indebtedness or may be subordinated to certain other indebtedness of the Company. CONVERSION RIGHTS The terms, if any, on which Debt Securities of a series may be exchanged for or converted into shares of Common Stock, Preferred Stock or Debt Securities of another series will be set forth in the Prospectus Supplement relating thereto. To protect the Company's status as a REIT, a Holder may not convert any Debt Security, and such Debt Security shall not be convertible by any Holder, if as a result of such conversion any person would then be deemed to beneficially own, directly or indirectly, 9.9% or more of the Company's shares of Common Stock. ABSENCE OF RESTRICTIVE COVENANTS Except as noted below under "Dividends, Distributions and Acquisitions of Capital Stock," the Company is not restricted by the Indenture from paying dividends or from incurring, assuming or becoming liable for any type of debt or other obligations or from creating liens on its property for any purpose. The Indenture does not require the maintenance of any financial ratios or specified levels of net worth or liquidity. Except as may be set forth in the Prospectus Supplement, there are no provisions of the Indenture which afford holders of the Debt Securities protection in the event of a highly leveraged transaction involving the Company. OPTIONAL REDEMPTION The Debt Securities will be subject to redemption, in whole or from time to time in part, at any time for certain reasons intended to protect the Company's status as a REIT, at the option of the Company in the manner specified in the Indenture at a redemption price equal to 100% of the principal amount, plus interest accrued to the date of redemption. The Indenture does not contain any provision requiring the Company to repurchase the Debt Securities at the option of the Holders thereof in the event of a leveraged buyout, recapitalization or similar restructuring of the Company, even though the Company's creditworthiness and the market value of the Debt Securities may decline significantly as a result of such transaction. The Indenture does not protect Holders of the Debt Securities against any decline in credit quality, whether resulting from any such transaction or from any other cause. DIVIDENDS, DISTRIBUTIONS AND ACQUISITIONS OF CAPITAL STOCK The Indenture provides that the Company will not (i) declare or pay any dividend or make any distribution on its capital stock or to holders of its capital stock (other than dividends or distributions payable in its capital stock or other than as the Company determines is necessary to maintain its status as a REIT) or (ii) purchase, 6 redeem or otherwise acquire or retire for value any of its capital stock, or any warrants, rights or options or other securities to purchase or acquire any shares of its capital stock (other than the Debt Securities) or permit any subsidiary to do so, if at the time of such action an Event of Default (as defined in the Indenture) has occurred and is continuing or would exist immediately after giving effect to such action. EVENTS OF DEFAULT An Event of Default with respect to Debt Securities of any series is defined in the Indenture as being: (a) failure to pay principal of or any premium on any Debt Security of that series when due; (b) failure to pay any interest on any Debt Security of that series when due, continued for 30 days; (c) failure to deposit any sinking fund payment when due, in respect of any Debt Security of that series; (d) failure to perform any other covenant of the Company in the Indenture (other than a covenant included in the Indenture solely for the benefit of one or more series of Debt Securities other than that series), continued for 60 days after written notice as provided in the Indenture; (e) certain events of bankruptcy, insolvency, conservatorship, receivership or reorganization; (f) a default under any mortgage, indenture or instrument evidencing any indebtedness for borrowed money by the Company (including the Indenture) resulting in an aggregate principal amount exceeding $10,000,000 becoming or being declared due and payable prior to its maturity date or constituting a failure to pay at maturity an aggregate principal amount exceeding $10,000,000, unless such acceleration has been rescinded or annulled or such indebtedness has been discharged within 10 days after written notice to the Company by the Trustee or Holders of at least 25% in aggregate principal amount of the outstanding Debt Securities declaring a default or the Company is contesting the validity of such default in good faith by appropriate proceedings; and (g) any other Event of Default provided with respect to the Debt Securities of that series. If an Event of Default with respect to the outstanding Debt Securities of any series occurs and is continuing, either the Trustee or the Holders of at least 25% in aggregate principal amount of the outstanding Debt Securities of that series may declare the principal amount (or, if the Debt Securities of that series are original issue discount Debt Securities, such portion of the principal amount as may be specified in the terms of that series) of all the outstanding Debt Securities of that series to be due and payable immediately. At any time after the declaration of acceleration with respect to the Debt Securities of any series has been made, but before a judgment or decree based on acceleration has been obtained, the Holders of a majority in aggregate principal amount of the outstanding Debt Securities of that series may, under certain circumstances, rescind and annul such acceleration. The Indenture provides that, subject to the duty of the Trustee during default to act with the required standard of care, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request or direction of any of the Holders, unless such Holders shall have offered to the Trustee reasonable indemnity. Subject to such provisions for the indemnification of the Trustee and subject to certain limitations, the Holders of a majority in aggregate principal amount of the outstanding Debt Securities of any series will have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred on the Trustee, with respect to the Debt Securities of that series. The Company is required to furnish to the Trustee annually a statement as to the performance by the Company of certain of its obligations under the Indenture and as to any default in such performance. MODIFICATION AND WAIVER Modifications and amendments of the Indenture may be made by the Company and the Trustee without the consent of any Holders to, among other things, (a) evidence the succession of another corporation to the Company, (b) add to the covenants of the Company or surrender any right or power conferred upon the Company, (c) cure any ambiguity, correct or supplement any provision which may be defective or inconsistent or make any other provisions with respect to matters or questions arising under the Indenture, provided that such action does not adversely affect the interests of the Holders of Debt Securities of any series in any material respect, or (d) evidence and provide for a successor Trustee. 7 Modifications and amendments of the Indenture may be made by the Company and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the outstanding Debt Securities of each series affected by such modification or amendment; provided, however, that no such modification or amendment may, without the consent of the Holder of each outstanding Debt Security affected thereby, (a) change the stated maturity date of the principal of, or any installment of principal of or interest, if any, on any Debt Security, (b) reduce the principal amount of, or premium or interest if any, on any Debt Security, (c) reduce the amount of principal of an original issue discount Debt Security payable upon acceleration of the maturity thereof, (d) change the currency of payment of the principal of, or premium or interest, if any, on any Debt Security, (e) impair the right to institute suit for the enforcement of any payment on or with respect to any Debt Security, (f) modify the conversion provisions, if any, of any Debt Security in a manner adverse to the Holder of that Debt Security, or (g) reduce the percentage in principal amount of the outstanding Debt Security of any series, the consent of whose Holders is required for modification or amendment of that Indenture or for waiver of compliance with certain provisions of that Indenture or for waiver of certain defaults. The Holders of a majority in aggregate principal amount of the outstanding Debt Securities of each series may, on behalf of all Holders of the Debt Securities of that series, waive, insofar as that series is concerned, compliance by the Company with certain restrictive provisions of the Indenture. The Holders of a majority in aggregate principal amount of the outstanding Debt Securities of each series may, on behalf of all Holders of the Debt Securities of that series, waive any past default under the Indenture with respect to the Debt Securities of that series, except a default in the payment of principal or premium or interest, if any, or a default in respect of a covenant or provision which under the terms of the Indenture cannot be modified or amended without the consent of the Holder of each outstanding Debt Security of the series affected. CONSOLIDATION, MERGER AND SALE OF ASSETS The Indenture provides that the Company, without the consent of the Holders of any of the Debt Securities, may consolidate or merge with or into, or transfer its assets substantially as an entirety to, any corporation organized under the laws of the United States or any state, provided that the successor corporation assumes the Company's obligations under the Indenture, that after giving effect to the transaction no Event of Default, and no event which, after notice or lapse of time, would become an Event of Default, shall have occurred and be continuing, and that certain other conditions are met. GLOBAL SECURITIES The Debt Securities of a series may be issued in whole or in part in global form (the "Global Securities"). The Global Securities will be deposited with a depositary (the "Depositary"), or with a nominee for a Depositary, identified in the Prospectus Supplement. In such case, one or more Global Securities will be issued in a denomination or aggregate denominations equal to the portion of the aggregate principal amount of outstanding Debt Securities of the series to be represented by such Global Security or Securities. Unless and until it is exchanged in whole or in part for Debt Securities in definitive form, a Global Security may not be transferred except as a whole by the Depositary for such Global Security to a nominee of such Depositary or by a nominee of such Depositary to such Depositary or another nominee of such Depositary or by such Depositary or any such nominee to a successor of such Depositary or a nominee of such successor. The specific material terms of the depositary arrangement with respect to any portion of a series of Debt Securities to be represented by a Global Security will be described in the Prospectus Supplement. The Company anticipates that the following provisions will apply to all depositary arrangements. Upon the issuance of a Global Security, the Depositary for such Global Security will credit, on its book-entry registration and transfer system, the respective principal amounts of the Debt Securities represented by such Global Security to the accounts of persons that have accounts with such Depositary ("participants"). The accounts to be credited shall be designated by any underwriters or agents participating in the distribution of such Debt Securities. Ownership of beneficial interests in a Global Security will be limited to participants or persons that may hold interests through participants. Ownership of beneficial interests in such Global Security will be shown 8 on, and the transfer of that ownership will be effected only through, records maintained by the Depositary for such Global Security (with respect to interests of participants) or by participants or persons that hold through participants (with respect to interests of persons other than participants). So long as the Depositary for a Global Security, or its nominee, is the registered owner of such Global Security, such Depositary or such nominee, as the case may be, will be considered the sole owner or Holder of the Debt Securities represented by such Global Security for all purposes under the Indenture; provided, however, that for purposes of obtaining any consents or directions required to be given by the Holders of the Debt Securities, the Company, the Trustee and its agents will treat a person as the holder of such principal amount of Debt Securities as specified in a written statement of the Depositary. Except as set forth herein or otherwise provided in the Prospectus Supplement, owners of beneficial interests in a Global Security will not be entitled to have the Debt Securities represented by such Global Security registered in their names, will not receive physical delivery of such Debt Securities in definitive form and will not be considered the owners or Holders thereof under the Indenture. Principal, premium, if any, and interest payments on Debt Securities represented by a Global Security registered in the name of a Depositary or its nominee will be made to such Depositary or its nominee, as the case may be, as the registered owner of such Global Security. None of the Company, the Trustee or any Paying Agent for such Debt Securities will have any responsibility or liability for any aspect of the records relating to or payments made on account of beneficial ownership interests in such Global Security or for maintaining, supervising or reviewing any records relating to such beneficial ownership interests. The Company expects that the Depositary for any Debt Securities represented by a Global Security, upon receipt of any payment of principal, premium, if any, or interest will immediately credit participants' accounts with payments in amounts proportionate to their respective beneficial interests in the principal amount of such Global Security as shown on the records of such Depositary. The Company also expects that payments by participants will be governed by standing instructions and customary practices, as is now the case with the securities held for the accounts of customers registered in "street names" and will be the responsibility of such participants. If the Depositary for any Debt Securities represented by a Global Security is at any time unwilling or unable to continue as Depositary and a successor Depositary is not appointed by the Company within 90 days, the Company will issue such Debt Securities in definitive form in exchange for such Global Security. In addition, the Company may at any time and in its sole discretion determine not to have any of the Debt Securities of a series represented by one or more Global Securities and, in such event, will issue Debt Securities of such series in definitive form in exchange for all of the Global Security or Securities representing such Debt Securities. The laws of some states require that certain purchasers of securities take physical delivery of such securities in definitive form. Such laws may impair the ability to transfer beneficial interests in Debt Securities represented by Global Securities. GOVERNING LAW The Indenture and the Debt Securities will be governed by and construed in accordance with the laws of the State of New York. DESCRIPTION OF PREFERRED STOCK The following description of the terms of the Preferred Stock sets forth certain general terms and provisions of the Preferred Stock to which any Prospectus Supplement may relate. Certain other terms of any series of the Preferred Stock offered by any Prospectus Supplement will be described in such Prospectus Supplement. The description of certain provisions of the Preferred Stock set forth below and in any Prospectus Supplement does not purport to be complete and is subject to and qualified in its entirety by reference to the Company's Amended and Restated Articles of Incorporation (the "Articles of Incorporation"), and the Board of Directors' resolution or articles supplementary (the "Articles Supplementary") relating to each series of the Preferred Stock which will 9 be filed with the Commission and incorporated by reference as an exhibit to the Registration Statement of which this Prospectus is a part at or prior to the time of the issuance of such series of the Preferred Stock. GENERAL The authorized capital stock of the Company consists of 100,000,000 shares of Common Stock, $0.10 par value per share, and 5,000,000 shares of preferred stock, $1.00 par value per share ("preferred stock of the Company," which term, as used herein, includes the Preferred Stock offered hereby). See "Description of Common Stock." Under the Articles of Incorporation, the Board of Directors of the Company is authorized without further stockholder action to provide for the issuance of up to 5,000,000 shares of preferred stock of the Company, in one or more series, with such voting, dividend, conversion or liquidation rights, designations, preferences, powers and relative participating, optional or other special rights and qualifications, limitations or restrictions of shares of such series as shall be stated in the resolution providing for the issue of a series of such stock, adopted, at any time or from time to time, by the Board of Directors of the Company. As described under "Description of Depositary Shares," the Company may, at its option, elect to offer Depositary Shares evidenced by depositary receipts (the "Depositary Receipts"), each representing a fraction (to be specified in the Prospectus Supplement relating to the particular series of the Preferred Stock) of a share of the particular series of the Preferred Stock issued and deposited with a depositary, in lieu of offering full shares of such series of the Preferred Stock. The Preferred Stock shall have the dividend, liquidation, redemption and voting rights set forth below unless otherwise provided in a Prospectus Supplement relating to a particular series of the Preferred Stock. Reference is made to the Prospectus Supplement relating to the particular series of the Preferred Stock offered thereby for specific terms, including: (i) the designation and stated value per share of such Preferred Stock and the number of shares offered; (ii) the amount of liquidation preference per share; (iii) the initial public offering price at which such Preferred Stock will be issued; (iv) the dividend rate (or method of calculation), the dates on which dividends shall be payable and the dates from which dividends shall commence to cumulate, if any; (v) any redemption or sinking fund provisions; (vi) any conversion rights; (vii) whether the Company has elected to offer Depositary Shares as described below under "Description of Depositary Shares;" and (viii) any additional voting, dividend, liquidation, redemption, sinking fund and other rights, preferences, privileges, limitations and restrictions. The Preferred Stock will, when issued, be fully paid and nonassessable and will have no preemptive rights. Unless otherwise stated in a Prospectus Supplement relating to a particular series of the Preferred Stock, each series of the Preferred Stock will rank on a parity as to dividends and distributions of assets with each other series of the Preferred Stock. The rights of the holders of each series of the Preferred Stock will be subordinate to those of the Company's general creditors. CERTAIN PROVISIONS OF THE ARTICLES OF INCORPORATION See "Description of Common Stock --- Redemption and Business Combination Provisions" for a description of certain provisions of the Articles of Incorporation, including provisions relating to redemption rights and provisions which may have certain anti-takeover effects. DIVIDEND RIGHTS Holders of the Preferred Stock of each series will be entitled to receive, when, as and if declared by the Board of Directors of the Company, out of funds of the Company legally available therefor, cash dividends on such dates and at such rates as are set forth in, or as are determined by the method described in, the Prospectus Supplement relating to such series of the Preferred Stock. Such rate may be fixed or variable or both. Each such dividend will be payable to the holders of record as they appear on the stock books of the Company (or, 10 if applicable, the records of the Depositary (as hereinafter defined) referred to under "Description of Depositary Shares") on such record dates, fixed by the Board of Directors of the Company, as specified in the Prospectus Supplement relating to such series of Preferred Stock. Such dividends may be cumulative or noncumulative, as provided in the Prospectus Supplement relating to such series of Preferred Stock. If the Board of Directors of the Company fails to declare a dividend payable on a dividend payment date on any series of Preferred Stock for which dividends are noncumulative, then the right to receive a dividend in respect of the dividend period ending on such dividend payment date will be lost, and the Company shall have no obligation to pay the dividend accrued for such period, whether or not dividends on such series are declared payable on any future dividend payment dates. Dividends on the shares of each series of Preferred Stock for which dividends are cumulative will accrue from the date on which the Company initially issues shares of such series. So long as the shares of any series of the Preferred Stock shall be outstanding, unless (i) full dividends (including if such Preferred Stock is cumulative, dividends for prior dividend periods) shall have been paid or declared and set apart for payment on all outstanding shares of the Preferred Stock of such series and all other classes and series of preferred stock of the Company (other than Junior Stock, as defined below) and (ii) the Company is not in default or in arrears with respect to the mandatory or optional redemption or mandatory repurchase or other mandatory retirement of, or with respect to any sinking or other analogous fund for, any shares of Preferred Stock of such series or any shares of any other preferred stock of the Company of any class or series (other than Junior Stock), the Company may not, other than as the Company determines is necessary to maintain its status as a REIT, declare any dividends on any shares of Common Stock of the Company or any other stock of the Company ranking as to dividends or distributions of assets junior to such series of Preferred Stock (the Common Stock and any such other stock ranking junior to such series of Preferred Stock being herein referred to as "Junior Stock"), or make any payment on account of, or set apart money for, the purchase, redemption or other retirement of, or for a sinking or other analogous fund for, any shares of Junior Stock or make any distribution in respect thereof, whether in cash or property or in obligations or stock of the Company, other than Junior Stock which is neither convertible into, nor exchangeable or exercisable for, any securities of the Company other than Junior Stock. LIQUIDATION PREFERENCE In the event of any liquidation, dissolution or winding up of the Company, voluntary or involuntary, the holders of each series of the Preferred Stock will be entitled to receive out of the assets of the Company available for distribution to stockholders, before any distribution of assets is made to the holders of Common Stock or any other shares of stock of the Company ranking junior as to such distribution to such series of Preferred Stock, the amount set forth in the Prospectus Supplement relating to such series of the Preferred Stock. If, upon any voluntary or involuntary liquidation, dissolution or winding up of the Company, the amounts payable with respect to the Preferred Stock of any series and any other shares of preferred stock of the Company (including any other series of the Preferred Stock) ranking as to any such distribution on a parity with such series of the Preferred Stock are not paid in full, the holders of the Preferred Stock of such series and of such other shares of preferred stock of the Company will share ratably in any such distribution of assets of the Company in proportion to the full respective preferential amounts to which they are entitled. After payment to the holders of the Preferred Stock of each series of the full preferential amounts of the liquidating distribution to which they are entitled, the holders of each such series of the Preferred Stock will be entitled to no further participation in any distribution of assets by the Company. REDEMPTION A series of the Preferred Stock may be redeemable, in whole or from time to time in part, at the option of the Company, and may be subject to mandatory redemption pursuant to a sinking fund or otherwise, in each case upon terms, at the times and at the redemption prices set forth in the Prospectus Supplement relating to such series. Shares of the Preferred Stock redeemed by the Company will be restored to the status of authorized but unissued shares of preferred stock of the Company. 11 In the event that fewer than all of the outstanding shares of a series of the Preferred Stock are to be redeemed, whether by mandatory or optional redemption, the number of shares to be redeemed will be determined by lot or pro rata (subject to rounding to avoid fractional shares) as may be determined by the Company or by any other method as may be determined by the Company in its sole discretion to be equitable. From and after the redemption date (unless default shall be made by the Company in providing for the payment of the redemption price plus accumulated and unpaid dividends, if any), dividends shall cease to accumulate on the shares of the Preferred Stock called for redemption and all rights of the holders thereof (except the right to receive the redemption price plus accumulated and unpaid dividends, if any) shall cease. So long as any dividends on shares of any series of the Preferred Stock or any other series of preferred stock of the Company ranking on a parity as to dividends and distribution of assets with such series of the Preferred Stock are in arrears, no shares of any such series of the Preferred Stock or such other series of preferred stock of the Company will be redeemed (whether by mandatory or optional redemption) unless all such shares are simultaneously redeemed, and the Company will not purchase or otherwise acquire any such shares; provided, however, that the foregoing will not prevent the purchase or acquisition of such shares pursuant to a purchase or exchange offer made on the same terms to holders of all such shares outstanding. CONVERSION RIGHTS The terms, if any, on which shares of Preferred Stock of any series may be exchanged for or converted (mandatorily or otherwise) into shares of Common Stock or another series of Preferred Stock will be set forth in the Prospectus Supplement relating thereto. See "Description of Common Stock." VOTING RIGHTS Except as indicated below or in a Prospectus Supplement relating to a particular series of the Preferred Stock, or except as required by applicable law, the holders of the Preferred Stock will not be entitled to vote for any purpose. So long as any shares of the Preferred Stock of a series remain outstanding, the consent or the affirmative vote of the holders of at least 66-2/3% of the votes entitled to be cast with respect to the then outstanding shares of such series of the Preferred Stock together with any Other Preferred Stock (as defined below), voting as one class, either expressed in writing or at a meeting called for that purpose, will be necessary (i) to permit, effect or validate the authorization, or any increase in the authorized amount, of any class or series of shares of the Company ranking prior to the Preferred Stock of such series as to dividends, voting or upon distribution of assets and (ii) to repeal, amend or otherwise change any of the provisions applicable to the Preferred Stock of such series in any manner which adversely affects the powers, preferences, voting power or other rights or privileges qualifications, limitations and other characteristics of such series of the Preferred Stock. In case any series of the Preferred Stock would be so affected by any such action referred to in clause (ii) above in a different manner than one or more series of the Other Preferred Stock then outstanding, the holders of shares of the Preferred Stock of such series, together with any series of the Other Preferred Stock which will be similarly affected, will be entitled to vote as a class, and the Company will not take such action without the consent or affirmative vote, as above provided, of at least 66-2/3% of the total number of votes entitled to be cast with respect to each such series of the Preferred Stock and the Other Preferred Stock similarly affected, then outstanding, in lieu of the consent or affirmative vote hereinabove otherwise required. With respect to any matter as to which the Preferred Stock of any series is entitled to vote, holders of the Preferred Stock of such series and any other series of preferred stock of the Company ranking on a parity with such series of the Preferred Stock as to dividends and distributions of assets and which by its terms provides for similar voting rights (the "Other Preferred Stock") will be entitled to cast the number of votes set forth in the Prospectus Supplement with respect to that series of Preferred Stock. As a result of the provisions described in the preceding paragraph requiring the holders of shares of a series of the Preferred Stock to vote together as a class with the holders of shares of one or more series of Other Preferred Stock, it is possible that the holders of such shares of Other Preferred Stock could approve action that would adversely affect such series of 12 Preferred Stock, including the creation of a class of capital stock ranking prior to such series of Preferred Stock as to dividends, voting or distributions of assets. As more fully described below under "Description of Depositary Shares," if the Company elects to issue Depositary Shares, each representing a fraction of a share of a series of the Preferred Stock, each such Depositary Share will, in effect, be entitled to such fraction of a vote per Depositary Share. TRANSFER AGENT AND REGISTRAR Unless otherwise indicated in a Prospectus Supplement relating thereto, ChaseMellon Shareholder Services LLC will be the transfer agent, dividend and redemption price disbursement agent and registrar for shares of each series of the Preferred Stock. DESCRIPTION OF DEPOSITARY SHARES The description set forth below and in the Prospectus Supplement of certain provisions of the Deposit Agreement (as defined below) and of the Depositary Shares and Depositary Receipts do not purport to be complete and are subject to and qualified in their entirety by reference to the Deposit Agreement and Depositary Receipts relating to each series of the Preferred Stock which will be filed with the Commission and incorporated by reference as an exhibit to the Registration Statement of which this Prospectus is a part at or prior to the time of the issuance of such series of the Preferred Stock. The forms of Deposit Agreement and Depositary Receipt are filed as exhibits to the Registration Statement of which this Prospectus is a part. GENERAL The Company may, at its option, elect to offer fractional shares of Preferred Stock rather than full shares of Preferred Stock. In the event such option is exercised, the Company will issue to the public receipts for Depositary Shares, each of which will represent a fraction (to be set forth in the Prospectus Supplement relating to a particular series of the Preferred Stock) of a share of a particular series of the Preferred Stock as described below. The shares of any series of the Preferred Stock represented by Depositary Shares will be deposited under a separate deposit agreement (the "Deposit Agreement") among the Company, a bank or trust company selected by the Company (the "Depositary") and the holders from time to time of the Depositary Receipts. Subject to the terms of the Deposit Agreement, each owner of a Depositary Share will in general be entitled, in proportion to the applicable fraction of a share of Preferred Stock represented by such Depositary Share, to all the rights and preferences of the Preferred Stock represented thereby (including dividend, voting, redemption and liquidation rights). The Depositary Shares relating to any series of the Preferred Stock will be evidenced by Depositary Receipts issued pursuant to the related Deposit Agreement. Depositary Receipts will be distributed to those persons purchasing such Depositary Shares in accordance with the terms of the offering made by the related Prospectus Supplement. Upon surrender of Depositary Receipts at the office of the Depositary equal to one or more whole Depositary Shares and upon payment of the charges provided in the Deposit Agreement and subject to the terms thereof, a holder of Depositary Receipts is entitled to have the Depositary deliver to such holder certificates representing the whole shares of Preferred Stock underlying the Depositary Shares evidenced by the surrendered Depositary Receipts. 13 DIVIDENDS AND OTHER DISTRIBUTIONS The Depositary will distribute all cash dividends or other cash distributions received in respect of the Preferred Stock to the record holders of Depositary Receipts relating to such Preferred Stock in proportion, insofar as practicable, to the respective numbers of Depositary Shares evidenced by such Depositary Receipts held by such holders on the relevant record date. The Depositary shall distribute only such amount, however, as can be distributed without attributing to any holder of Depositary Receipts a fraction of one cent, and any balance not so distributed shall be added to and treated as part of the next sum received by the Depositary (without liability for the interest thereon), for distribution to record holders of Depositary Receipts then outstanding. In the event of a distribution other than in cash, the Depositary will distribute such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Depositary Receipts held by such holders on the relevant record date, unless the Depositary determines that it is not feasible to make such distribution, in which case the Depositary may, with the approval of the Company, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale of such securities or property. The Deposit Agreement will also contain provisions relating to the manner in which any subscription or similar rights offered by the Company to holders of the Preferred Stock shall be made available to holders of Depositary Receipts. The amount distributed in all of the foregoing cases will be reduced by any amounts required to be withheld by the Company or the Depositary on account of taxes and governmental charges. REDEMPTION OF DEPOSITARY SHARES If a series of the Preferred Stock represented by Depositary Shares is subject to redemption, the Depositary Shares will be redeemed from the proceeds received by the Depositary resulting from the redemption, in whole or in part, of such series of the Preferred Stock held by the Depositary. The Depositary shall mail notice of redemption not less than 30 and not more than 60 days prior to the date fixed for redemption to the record holders of the Depositary Receipts evidencing the Depositary Shares to be so redeemed at their respective addresses appearing in the Depositary's books. The redemption price per Depositary Share will be equal to the applicable fraction of the redemption price per share payable with respect to such series of the Preferred Stock plus all money and other property, if any, payable with respect to such Depositary Share, including all amounts payable by the Company in respect of any accumulated but unpaid dividends; provided, however, the Depositary may deduct such fees and charges as are expressly provided in the Deposit Agreement for the account of the holders of Depositary Receipts. Whenever the Company redeems shares of Preferred Stock held by the Depositary, the Depositary will redeem as of the same redemption date the number of Depositary Shares representing shares of Preferred Stock so redeemed. If less than all the Depositary Shares are to be redeemed, the Depositary Shares to be redeemed will be selected by lot or pro rata (subject to rounding to avoid fractions of Depositary Shares) as may be determined by the Depositary. After the date fixed for redemption, the Depositary Shares so called for redemption will no longer be deemed to be outstanding and all rights of the holders of Depositary Receipts evidencing such Depositary Shares will cease, except the right to receive without interest the moneys payable upon such redemption and any money or other property to which such holders were entitled upon such redemption upon surrender to the Depositary of the Depositary Receipts evidencing such Depositary Shares. VOTING THE PREFERRED STOCK Upon receipt of notice of any meeting or action to be taken by written consent at or as to which the holders of the Preferred Stock are entitled to vote or consent, the Depositary will mail the information contained in such notice of meeting or action to the record holders of the Depositary Receipts evidencing the Depositary Shares 14 relating to such Preferred Stock. Each record holder of such Depositary Receipts on the record date (which will be the same date as the record date for the Preferred Stock) will be entitled to instruct the Depositary as to the exercise of the voting rights or the giving or refusal of consent, as the case may be, pertaining to the number of shares of the Preferred Stock represented by the Depositary Shares evidenced by such holder's Depositary Receipts. The Depositary will endeavor, insofar as practicable, to vote, or give or withhold consent with respect to, the maximum number of whole shares of the Preferred Stock represented by all Depositary Shares as to which any particular voting or consent instructions are received, and the Company will agree to take all action which may be deemed necessary by the Depositary in order to enable the Depositary to do so. The Depositary will abstain from voting, or giving consents with respect to, shares of the Preferred Stock to the extent it does not receive specific instructions from the holders of Depositary Receipts evidencing Depositary Shares representing such Preferred Stock. AMENDMENT AND TERMINATION OF THE DEPOSIT AGREEMENT The form of Depositary Receipt evidencing the Depositary Shares relating to any series of Preferred Stock and any provision of the related Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable. However, any amendment which imposes or increases any fees, taxes or charges upon holders of Depositary Shares or Depositary Receipts relating to any series of Preferred Stock or which materially and adversely alters the existing rights of such holders will not be effective unless such amendment has been approved by the record holders of Depositary Receipts evidencing at least a majority of such Depositary Shares then outstanding. Notwithstanding the foregoing, no such amendment may impair the right of any holder of Depositary Shares or Depositary Receipts to receive any moneys or other property to which such holder may be entitled under the terms of such Depositary Receipts or the Deposit Agreement at the times and in the manner and amount provided for therein. A Deposit Agreement may be terminated by the Company or the Depositary only after (i) all outstanding Depositary Shares relating thereto have been redeemed and any accumulated and unpaid dividends on the Preferred Stock represented by the Depositary Shares, together with all other moneys and property, if any, to which holders of the related Depositary Receipts are entitled under the terms of such Depositary Receipts or the related Deposit Agreement, have been paid or distributed as provided in the Deposit Agreement or provision therefor has been duly made, (ii) there has been a final distribution in respect of the Preferred Stock of the relevant series in connection with any liquidation, dissolution or winding up of the Company and such distribution has been distributed to the holders of the related Depositary Receipts, or (iii) in the event the Depositary Shares relate to a series of Preferred Stock which is convertible into shares of Common Stock, all outstanding Depositary Shares have been converted into shares of Common Stock; provided, however, that resignation and removal of the Depositary, and appointment of a successor Depositary shall not constitute a termination of a Deposit Agreement. MISCELLANEOUS The Depositary will forward to record holders of Depositary Receipts, at their respective addresses appearing in the Depositary's books, all reports and communications from the Company which are delivered to the Depositary and which the Company is required to furnish to the holders of the Preferred Stock or Depositary Receipts. The Company will pay all transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangements. The Company will pay charges of the Depositary in connection with the initial deposit of the Preferred Stock and the initial issuance of the Depositary Receipts evidencing the Depositary Shares, any redemption of the Preferred Stock and any withdrawals of Preferred Stock by the holders of Depositary Shares. Holders of Depositary Shares will pay other transfer and other taxes and governmental charges and such other charges as are expressly provided in the Deposit Agreement to be for their accounts which may be deducted from payments otherwise due to such holders with respect to their Depositary Receipts. The Deposit Agreement will contain provisions relating to adjustments in the fraction of a share of Preferred Stock represented by a Depositary Share in the event of a change in par or stated value, split-up, combination 15 or other reclassification of the Preferred Stock or upon any recapitalization, merger or sale of substantially all of the assets of the Company. Neither the Depositary nor any of its agents nor any registrar nor the Company will be (i) liable if it is prevented or delayed by law or any circumstance beyond its control in performing its obligations under the Deposit Agreement, (ii) subject to any liability under the Deposit Agreement to holders of Depositary Receipts other than for the relevant party's gross negligence or willful misconduct or (iii) obligated to prosecute or defend any legal proceeding in respect of any Depositary Receipts, Depositary Shares or the Preferred Stock unless satisfactory indemnity is furnished. They may rely upon written advice of counsel or accountants, or information provided by holders of Depositary Receipts or other persons in good faith believed to be competent and on documents reasonably believed to be genuine. RESIGNATION OR REMOVAL OF DEPOSITARY The Depositary may resign at any time by delivering to the Company notice of its election to do so, and the Company may at any time remove the Depositary, any such resignation or removal to take effect upon the appointment of a successor Depositary and its acceptance of such appointment. Such successor Depositary must be appointed within 60 days after delivery of the notice of resignation or removal. DESCRIPTION OF COMMON STOCK COMMON STOCK All shares of Common Stock participate equally in dividends payable to stockholders of Common Stock when and as declared by the Board of Directors and in net assets available for distribution to stockholders of Common Stock on liquidation or dissolution, have one vote per share on all matters submitted to a vote of the stockholders and do not have cumulative voting rights in the election of directors. All issued and outstanding shares of Common Stock are, and the Common Stock offered hereby will be upon issuance, validly issued, fully paid and nonassessable. Holders of the Common Stock do not have preference, conversion, exchange or preemptive rights. The Common Stock is listed on the New York Stock Exchange (NYSE Symbol: NHP). REDEMPTION AND BUSINESS COMBINATION PROVISIONS If the Board of Directors shall, at any time and in good faith, be of the opinion that direct or indirect ownership of at least 9.9% or more of the voting shares of capital stock has or may become concentrated in the hands of one beneficial owner, the Board of Directors shall have the power (i) by lot or other means deemed equitable by it to call for the purchase from any stockholder of the Company a number of voting shares sufficient, in the opinion of the Board of Directors, to maintain or bring the direct or indirect ownership of voting shares of capital stock of such beneficial owner to a level of no more than 9.9% of the outstanding voting shares of the Company's capital stock, and (ii) to refuse to transfer or issue voting shares of capital stock to any person whose acquisition of such voting shares would, in the opinion of the Board of Directors, result in the direct or indirect ownership by that person of more than 9.9% of the outstanding voting shares of capital stock of the Company. Further, any transfer of shares, options, warrants or other securities convertible into voting shares that would create a beneficial owner of more than 9.9% of the outstanding voting shares shall be deemed void ab initio and the intended transferee shall be deemed never to have had an interest therein. The purchase price for any voting shares of capital stock so redeemed shall be equal to the fair market value of the shares reflected in the closing sales price for the shares, if then listed on a national securities exchange, or the average of the closing sales prices for the shares if then listed on more than one national securities exchange, or if the shares are not then listed on a national securities exchange, the latest bid quotation for the shares if then traded over-the-counter, on the last business day immediately preceding the day on which notices of such acquisitions are sent by the Company, or, if no such closing sales prices or quotations are available, then the purchase price shall be equal to the net asset value of such stock as determined by the Board of Directors in accordance with the provisions of applicable law. From and after the date fixed for purchase by the Board of Directors, the holder 16 of any shares so called for purchase shall cease to be entitled to distributions, voting rights and other benefits with respect to such shares, except the right to payment of the purchase price for the shares. The Articles of Incorporation require that, except in certain circumstances, Business Combinations (as defined) between the Company and a beneficial holder of 10% or more of the Company's outstanding voting stock (a "Related Person") be approved by the affirmative vote of at least 90% of the outstanding voting shares of the Company. A Business Combination is defined in the Articles of Incorporation as (a) any merger or consolidation of the Company with or into a Related Person, (b) any sale, lease, exchange, transfer or other disposition, including without limitation a mortgage or any other security device, of all or any "Substantial Part" (as defined below) of the assets of the Company (including without limitation any voting securities of a subsidiary) to a Related Person, (c) any merger or consolidation of a Related Person with or into the Company, (d) any sale, lease, exchange, transfer or other disposition of all or any Substantial Part of the assets of a Related Person to the Company, (e) the issuance of any securities (other than by way of pro rata distribution to all stockholders) of the Company to a Related Person, and (f) any agreement, contract or other arrangement providing for any of the transactions described in the definition of Business Combination. The term "Substantial Part" shall mean more than 10% of the book value of the total assets of the Company as of the end of its most recent fiscal year ending prior to the time the determination is being made. Pursuant to the Articles of Incorporation, the Company's Board of Directors is classified into three classes. Each class of directors serves for a term of three years, with one class being elected each year. As of the date of this Prospectus, there are six directors, divided into three classes consisting of one, two and three directors, respectively. The foregoing provisions of the Articles of Incorporation and certain other matters may not be amended without the affirmative vote of at least 90% of the outstanding voting shares of the Company. The foregoing provisions may have the effect of discouraging unilateral tender offers or other takeover proposals which certain stockholders might deem in their interests or in which they might receive a substantial premium. The Board of Directors' authority to issue and establish the terms of currently authorized Preferred Stock, without stockholder approval, may also have the effect of discouraging takeover attempts. See "Description of Preferred Stock." The provisions could also have the effect of insulating current management against the possibility of removal and could, by possibly reducing temporary fluctuations in market price caused by accumulations of shares, deprive stockholders of opportunities to sell at a temporarily higher market price. However, the Board of Directors believes that inclusion of the Business Combination provisions in the Articles of Incorporation may help assure fair treatment of stockholders and preserve the assets of the Company. The foregoing summary of certain provisions of the Articles of Incorporation does not purport to be complete or to give effect to provisions of statutory or common law. The foregoing summary is subject to, and qualified in its entirety by reference to, the provisions of applicable law and the Articles of Incorporation, a copy of which is incorporated by reference as an exhibit to the Registration Statement of which this Prospectus is a part. TRANSFER AGENT AND REGISTRAR ChaseMellon Shareholder Services LLC is the transfer agent and registrar of the Common Stock. DESCRIPTION OF SECURITIES WARRANTS The Company may issue Securities Warrants for the purchase of Debt Securities, Preferred Stock, Depositary Shares or Common Stock. Securities Warrants may be issued independently or together with Debt Securities, Preferred Stock, Depositary Shares or Common Stock offered by any Prospectus Supplement and may 17 be attached to or separate from such Debt Securities, Preferred Stock, Depositary Shares or Common Stock. Each series of Securities Warrants will be issued under a separate warrant agreement (a "Securities Warrant Agreement") to be entered into between the Company and a bank or trust company, as Securities Warrant agent, all as set forth in the Prospectus Supplement relating to the particular issue of offered Securities Warrants. The Securities Warrant agent will act solely as an agent of the Company in connection with the Securities Warrant certificates relating to the Securities Warrants and will not assume any obligation or relationship of agency or trust for or with any holders of Securities Warrant certificates or beneficial owners of Securities Warrants. The following summaries of certain provisions of the Securities Warrant Agreement and Securities Warrants do not purport to be complete and are subject to, and are qualified in their entirety by reference to, all the provisions of the Securities Warrant Agreement and the Securities Warrant certificates relating to each series of Security Warrants which will be filed with the Commission and incorporated by reference as an exhibit to the Registration Statement of which this Prospectus is a part at or prior to the time of the issuance of such series of Securities Warrants. If Securities Warrants are offered, the applicable Prospectus Supplement will describe the terms of such Securities Warrants, including, in the case of Securities Warrants for the purchase of Debt Securities, the following where applicable: (i) the offering price; (ii) the denominations and terms of the series of Debt Securities purchasable upon exercise of such Securities Warrants; (iii) the designation and terms of any series of Debt Securities, Preferred Stock or Depositary Shares with which such Securities Warrants are being offered and the number of such Securities Warrants being offered with each such Debt Security, Preferred Stock or Depositary Share; (iv) the date, if any, on and after which such Securities Warrants and the related series of Debt Securities, Preferred Stock or Depositary Shares will be transferable separately; (v) the principal amount of the series of Debt Securities purchasable upon exercise of each such Securities Warrant and the price at which such principal amount of Debt Securities of such series may be purchased upon such exercise; (vi) the date on which the right to exercise such Securities Warrants shall commence and the date (the "Expiration Date") on which such right shall expire; (vii) whether the Securities Warrants will be issued in registered or bearer form; (viii) any special United States Federal income tax consequences; (ix) the terms, if any, on which the Company may accelerate the date by which the Securities Warrants must be exercised; and (x) any other terms of such Securities Warrants. In the case of Securities Warrants for the purchase of Preferred Stock, Depositary Shares or Common Stock, the applicable Prospectus Supplement will describe the terms of such Securities Warrants, including the following where applicable: (i) the offering price; (ii) the aggregate number of shares purchasable upon exercise of such Securities Warrants, the exercise price, and in the case of Securities Warrants for Preferred Stock or Depositary Shares, the designation, aggregate number and terms of the series of Preferred Stock purchasable upon exercise of such Securities Warrants or underlying the Depositary Shares purchasable upon exercise of such Securities Warrants; (iii) the designation and terms of the series of Debt Securities, Preferred Stock or Depositary Shares with which such Securities Warrants are being offered and the number of such Securities Warrants being offered with each such Debt Security, Preferred Stock or Depositary Share; (iv) the date, if any, on and after which such Securities Warrants and the related series of Debt Securities, Preferred Stock, Depositary Shares or Common Stock will be transferable separately; (v) the date on which the right to exercise such Securities Warrants shall commence and the Expiration Date; (vi) any special United States Federal income tax consequences; and (vii) any other terms of such Securities Warrants. Securities Warrant certificates may be exchanged for new Securities Warrant certificates of different denominations, may (if in registered form) be presented for registration of transfer, and may be exercised at the corporate trust office of the Securities Warrant agent or any other office indicated in the applicable Prospectus Supplement. Prior to the exercise of any Securities Warrant to purchase Debt Securities, holders of such Securities Warrants will not have any of the rights of holders of the Debt Securities purchasable upon such exercise, including the right to receive payments of principal of, premium, if any, or interest, if any, on such Debt Securities or to enforce covenants in the applicable indenture. Prior to the exercise of any Securities Warrants to purchase Preferred Stock, Depositary Shares or Common Stock, holders of such Securities Warrants will not have any rights of holders of such Preferred Stock, Depositary Shares or Common Stock, including the right to 18 receive payments of dividends, if any, on such Preferred Stock or Common Stock, or to exercise any applicable right to vote. CERTAIN RISK CONSIDERATIONS Any Securities Warrants issued by the Company will involve a certain degree of risk, including risks arising from fluctuations in the price of the underlying securities and general risks applicable to the stock market (or markets) on which the underlying securities are traded. Prospective purchasers of the Securities Warrants should recognize that the Securities Warrants may expire worthless and, thus, purchasers should be prepared to sustain a total loss of the purchase price of their Securities Warrants. This risk reflects the nature of a Securities Warrant as an asset which, other factors held constant, tends to decline in value over time and which may, depending on the price of the underlying securities, become worthless when it expires. The trading price of a Securities Warrant at any time is expected to increase if the price, or, if applicable, dividend rate on the underlying securities, increases. Conversely, the trading price of a Securities Warrant is expected to decrease as the time remaining to expiration of the Securities Warrant decreases and as the price or, if applicable, dividend rate on the underlying securities, decreases. Assuming all other factors are held constant, the more a Securities Warrant is "out-of-the-money" (i.e., the more the exercise price exceeds the price of the underlying securities and the shorter its remaining term to expiration), the greater the risk that a purchaser of the Securities Warrant will lose all or part of his or her investment. If the price of the underlying securities does not rise before the Securities Warrant expires to an extent sufficient to cover a purchaser's cost of the Securities Warrant, the purchaser will lose all or part of his or her investment in such Securities Warrant upon expiration. In addition, prospective purchasers of the Securities Warrants should be experienced with respect to options and option transactions and understand the risks associated with options and should reach an investment decision only after careful consideration, with their financial advisers, of the suitability of the Securities Warrants in light of their particular financial circumstances and the information discussed herein and, if applicable, the Prospectus Supplement. Before purchasing, exercising or selling any Securities Warrants, prospective purchasers and holders of Securities Warrants should carefully consider, among other things, (i) the trading price of the Securities Warrants, (ii) the price of the underlying securities at such time, (iii) the time remaining to expiration and (iv) any related transaction costs. Some of the factors referred to above are in turn influenced by various political, economic and other factors that can affect the trading price of the underlying securities and should be carefully considered prior to making any investment decisions. Purchasers of the Securities Warrants should further consider that the initial offering price of the Securities Warrants may be in excess of the price that a purchaser of options might pay for a comparable option in a private, less liquid transaction. In addition, it is not possible to predict the price at which the Securities Warrants will trade in the secondary market or whether any such market will be liquid. The Company may, but is not obligated to, file an application to list any Securities Warrants issued on a United States national securities exchange. To the extent that any Securities Warrants are exercised, the number of Securities Warrants outstanding will decrease, which may result in a lessening of the liquidity of the Securities Warrants. Finally, the Securities Warrants will constitute direct, unconditional and unsecured obligations of the Company and as such will be subject to any changes in the perceived creditworthiness of the Company. EXERCISE OF SECURITIES WARRANTS Each Securities Warrant will entitle the holder thereof to purchase such principal amount of Debt Securities or number of shares of Preferred Stock, Depositary Shares or Common Stock, as the case may be, at such exercise price as shall in each case be set forth in, or calculable from, the Prospectus Supplement relating to the offered Securities Warrants. After the close of business on the Expiration Date (or such later date to which such Expiration Date may be extended by the Company), unexercised Securities Warrants will become void. 19 Securities Warrants may be exercised by delivering to the Securities Warrant agent payment as provided in the applicable Prospectus Supplement of the amount required to purchase the Debt Securities, Preferred Stock, Depositary Shares or Common Stock, as the case may be, purchasable upon such exercise together with certain information set forth on the reverse side of the Securities Warrant certificate. Securities Warrants will be deemed to have been exercised upon receipt of payment of the exercise price, subject to the receipt within five (5) business days, of the Securities Warrant certificate evidencing such Securities Warrants. Upon receipt of such payment and the Securities Warrant certificate properly completed and duly executed at the corporate trust office of the Securities Warrant agent or any other office indicated in the applicable Prospectus Supplement, the Company will, as soon as practicable, issue and deliver the Debt Securities, Preferred Stock, Depositary Shares or Common Stock, as the case may be, purchasable upon such exercise. If fewer than all of the Securities Warrants represented by such Securities Warrant certificate are exercised, a new Securities Warrant certificate will be issued for the remaining amount of Securities Warrants. AMENDMENTS AND SUPPLEMENTS TO SECURITIES WARRANT AGREEMENT The Securities Warrant Agreements may be amended or supplemented without the consent of the holders of the Securities Warrants issued thereunder to effect changes that are not inconsistent with the provisions of the Securities Warrants and that do not adversely affect the interests of the holders of the Securities Warrants. COMMON STOCK WARRANT ADJUSTMENTS Unless otherwise indicated in the applicable Prospectus Supplement, the exercise price of, and the number of shares of Common Stock covered by, a Common Stock Warrant are subject to adjustment in certain events, including (i) payment of a dividend on the Common Stock payable in capital stock and stock splits, combinations or reclassifications of the Common Stock, (ii) issuance to all holders of Common Stock of rights or warrants to subscribe for or purchase shares of Common Stock at less than their current market price (as defined in the Securities Warrant Agreement for such series of Common Stock Warrants), and (iii) certain distributions of evidences of indebtedness or assets (including securities but excluding cash dividends or distributions paid out of consolidated earnings or retained earnings or dividends payable in Common Stock) or of subscription rights and warrants (excluding those referred to above). No adjustment in the exercise price of, and the number of shares of Common Stock covered by, a Common Stock Warrant will be made for regular quarterly or other periodic or recurring cash dividends or distributions or for cash dividends or distributions to the extent paid from consolidated earnings or retained earnings. No adjustment will be required unless such adjustment would require a change of at least 1% in the exercise price then in effect. Except as stated above, the exercise price of, and the number of shares of Common Stock covered by, a Common Stock Warrant will not be adjusted for the issuance of Common Stock or any securities convertible into or exchangeable for Common Stock, or carrying the right or option to purchase or otherwise acquire the foregoing, in exchange for cash, other property or services. In the event of any (i) consolidation or merger of the Company with or into any entity (other than a consolidation or a merger that does not result in any reclassification, conversion, exchange or cancellation of outstanding shares of Common Stock), (ii) sale, transfer, lease or conveyance of all or substantially all of the assets of the Company or (iii) reclassification, capital reorganization or change of the Common Stock (other than solely a change in par value or from par value to no par value), then any holder of a Common Stock Warrant will be entitled, on or after the occurrence of any such event, to receive on exercise of such Common Stock Warrant the kind and amount of shares of stock or other securities, cash or other property (or any combination thereof) that the holder would have received had such holder exercised such holder's Common Stock Warrant immediately prior to the occurrence of such event. If the consideration to be received upon exercise of the Common Stock Warrant following any such event consists of common stock of the surviving entity, then from and after the occurrence of such event, the exercise price of such Common Stock Warrant will be subject to the same anti-dilution and other adjustments described in the second preceding paragraph, applied as if such common stock were Common Stock. 20 PLAN OF DISTRIBUTION The Company may sell the Securities to one or more underwriters for public offering and sale by them or may sell the Securities to investors directory or through agents. Any such underwriter or agent involved in the offer and sale of Securities will be named in the applicable Prospectus Supplement. The Company has reserved the right to sell Securities directly to investors on its own behalf in those jurisdictions where and in such manner as it is authorized to do so. Underwriters may offer and sell Securities at a fixed price or prices, which may be changed, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at negotiated prices. The Company also may offer and sell Securities in exchange for one or more of its outstanding issues of the Securities or other securities. The Company also may, from time to time, authorize dealers, acting as the Company's agents, to offer and sell Securities upon the terms and conditions as are set forth in the applicable Prospectus Supplement. In connection with the sale of Securities, underwriters may receive compensation from the Company in the form of underwriting discounts or commissions and may also receive commissions from purchasers of the Securities for whom they may act as agent. Underwriters may sell Securities to or through dealers, and such dealers may receive compensation in the form of discounts, concessions or commissions from the underwriters and/or commissions from the purchasers for whom they may act as agent. Any underwriting compensation paid by the Company to underwriters or agents in connection with the offering of Securities, and any discounts, concessions or commissions allowed by underwriters to participating dealers, will be set forth in the applicable Prospectus Supplement. Dealers and agents participating in the distribution of Securities may be deemed to be underwriters, and any discounts and commissions received by them and any profit realized by them on resale of the Securities may be deemed to be underwriting discounts and commissions. Underwriters, dealers and agents may be entitled, under agreements entered into with the Company, to indemnification against and contribution toward certain civil liabilities. If so indicated in the Prospectus Supplement, the Company will authorize dealers acting as the Company's agents to solicit offers by certain institutions to purchase the Securities from the Company at the public offering price set forth in the applicable Prospectus Supplement pursuant to delayed delivery contracts ("Contracts") providing for payment and delivery on the date or dates stated in such Prospectus Supplement. Each Contract will be for an amount not less than, and the aggregate principal amount of the Securities sold pursuant to Contracts shall be not less nor more than, the respective amounts stated in the applicable Prospectus Supplement. Institutions with whom Contracts, when authorized, may be made include commercial and savings banks, insurance companies, pension funds, investment companies, educational and charitable institutions, and other institutions but will in all cases be subject to the approval of the Company. Contracts will not be subject to any conditions except (i) the purchase by an institution of the Securities covered by its Contracts shall not at the time of delivery be prohibited under the laws of any jurisdiction in the United States to which such institution is subject, and (ii) if the Securities are being sold to underwriters, the Company shall have sold to such underwriters the total principal amount of such Securities less the principal amount thereof covered by Contracts. The net proceeds to the Company from the sale of the Securities will be the purchase price of the Securities less any such discounts or commissions and the other attributable expenses of issuance and distribution. LEGAL MATTERS The validity of the Securities offered hereby will be passed upon for the Company by O'Melveny & Myers LLP. In addition, O'Melveny & Myers LLP has passed upon certain federal income tax matters relating to the Company. 21 EXPERTS The consolidated balance sheets of the Company as of December 31, 1995, 1994, 1993, 1992, and 1991 and the consolidated statements of operations, stockholders' equity and cash flows for each of the five years in the period ended December 31, 1995, incorporated by reference in this Prospectus and elsewhere in the Registration Statement, have been audited by Arthur Andersen LLP, independent public accountants, as indicated in their report with respect thereto, and are incorporated by reference herein in reliance upon the authority of said firm as experts in accounting and auditing in giving said reports. 22 ================================================================================ No dealer, salesman or other person has been authorized to give any information or to make any representations other than those contained or incorporated by reference in this Prospectus in connection with the offer made by this Prospectus and, if given or made, such information or representations must not be relied upon as having been authorized by the Company or any underwriter, dealer or agent. Neither the delivery of this Prospectus nor any sale made hereunder shall, under any circumstances, create an implication that there has been no change in the affairs of the Company since the date hereof. This Prospectus does not constitute an offer or solicitation by anyone in any state in which such offer or solicitation is not authorized or in which the person making such offer or solicitation is not qualified to do so or to anyone to whom it is unlawful to make such offer or solicitation. _______________________ TABLE OF CONTENTS
Page ---- AVAILABLE INFORMATION................ 2 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE........................ 2 THE COMPANY.......................... 3 SELECTED CONSOLIDATED FINANCIAL INFORMATION......................... 4 RATIO OF EARNINGS TO FIXED CHARGES... 5 USE OF PROCEEDS...................... 5 DESCRIPTION OF DEBT SECURITIES....... 5 DESCRIPTION OF PREFERRED STOCK....... 9 DESCRIPTION OF DEPOSITARY SHARES..... 13 DESCRIPTION OF COMMON STOCK.......... 16 DESCRIPTION OF SECURITIES WARRANTS... 17 PLAN OF DISTRIBUTION................. 21 LEGAL MATTERS........................ 21 EXPERTS.............................. 22
============================================================================= ============================================================================= $300,000,000 NATIONWIDE HEALTH PROPERTIES, INC. SECURITIES ____________________ PROSPECTUS ____________________ November 27, 1996 ================================================================================ PART II INFORMATION NOT REQUIRED IN THE PROSPECTUS ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION. The expenses of this offering are estimated as follows:
SEC Registration Fee.................................. $ 90,910 Blue Sky fees and expenses............................ 15,000 Printing and engraving expenses....................... 50,000 Legal fees and expenses............................... 100,000 Accounting fees and expenses.......................... 50,000 Transfer agent or trustee fees........................ 15,000 Miscellaneous......................................... 4,090 -------- Total............................................... $325,000 ========
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS. The Articles of Incorporation of the Company provide for indemnification of directors and officers to the full extent permitted by the laws of the State of Maryland. Section 2-418 of the Maryland General Corporation Law generally permits indemnification of any director or officer made a party to any proceedings by reason of service as a director or officer unless it is established that (i) the act or omission of such person was material to the matter giving rise to the proceeding and was committed in bad faith or was the result of active and deliberate dishonesty; or (ii) such person actually received an improper personal benefit in money, property or services; or (iii) in the case of any criminal proceeding, such person had reasonable cause to believe that the act or omission was unlawful. The indemnity may include judgments, penalties, fines, settlements and reasonable expenses actually incurred by the director or officer in connection with the proceeding; provided, however, that if the proceeding is one by, or in the right of the corporation, indemnification is not permitted with respect to any proceeding in which the director or officer has been adjudged to be liable to the corporation. The termination of any proceeding by conviction or upon a plea of nolo contendere or its equivalent or upon an entry of an order of probation prior to judgment creates a rebuttable presumption that the director or officer did not meet the requisite standard of conduct required for permitted indemnification. The termination of any proceeding by judgment, order or settlement, however, does not create a presumption that the director or officer failed to meet the requisite standard of conduct for permitted indemnification. The Company has entered into indemnity agreements with the officers and directors of the Company that provide that the Company will pay on behalf of the indemnified party any amount which the indemnified party is or becomes legally obligated to pay because of any act or omission or neglect or breach of duty, including any actual or alleged error or misstatement or misleading statement, which the indemnified party commits or suffers while acting in the capacity as an officer or director of the Company. Since November 1986, the Company has had in force directors' and officers' liability and Company reimbursement insurance covering liability for error, misstatement, misleading statement, act or omission, and neglect or breach of duty claimed against them solely by reason of their being directors or officers of the Company. II-1
ITEM 16. EXHIBITS. EXHIBIT NO. DESCRIPTION - ------- ----------- 4.1(a) Amended and Restated Articles of Incorporation, filed as Exhibit 3.1 to the Company's Registration Statement on Form S-11 (No. 33-1128), effective December 19, 1985, and incorporated herein by this reference. 4.1(b) Articles of Amendment and Restated Articles of Incorporation of the Company, filed as Exhibit 3.1 to the Company's Form 10-Q for the quarter ended March 31, 1989, and incorporated herein by this reference. 4.1(c) Articles of Amendment of Amended and Restated Articles of Incorporation of the Company, filed as Exhibit 3.1(c) to the Company's Registration Statement on Form S-11 (No. 33-32251), effective January 23, 1990, and incorporated herein by this reference. 4.1(d) Articles of Amendment of Amended and Restated Articles of Incorporation of the Company, filed as Exhibit 3.1(d) to the Company's Form 10-K for the year ended December 31, 1994 and incorporated herein by this reference. 4.2 Form of Indenture to be entered into between the Company and The Bank of New York, as Trustee, and relating to the Debt Securities. 4.3 Form of Deposit Agreement. 4.4 Form of Depository Receipt (attached as Exhibit A to Deposit Agreement included as Exhibit 4.3 hereto) 5.1 Opinion of O'Melveny & Myers LLP as to the validity of the Securities. 8.1 Opinion of O'Melveny & Myers LLP re tax matters. 12 Statement re Computation of Ratio of Earnings to Fixed Charges. 24.1 Consent of Arthur Andersen LLP (contained on page II-5). 24.2 Consent of O'Melveny & Myers LLP (included in Exhibit 5.1). 24.3 Consent of O'Melveny & Myers LLP (included in Exhibit 8.1). 25 Power of Attorney (contained on page II-4). 26 Form T-1 Statement of Eligibility and Qualification under the Trust Indenture Act of 1939 of The Bank of New York, as Trustee (separately bound).
______________________________________ ITEM 17. UNDERTAKINGS. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the provisions described in Item 15 above, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. II-2 In the event that a claim for indemnification against such liabilities (other than the repayment by the registrant of expenses incurred or paid by a director, officer or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue. The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement: (i) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933, unless the information required to be included in such post-effective amendment is contained in periodic reports filed by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 and incorporated herein by reference; (ii) To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement, unless the information required to be included in such post-effective amendment is contained in a periodic report filed by the Registrant pursuant to Section 13 or Section 15(d) of the Securities Exchange Act of 1934 and incorporated herein by reference; (iii) To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement. (2) That, for the purpose of determining any liability under the Securities Act of 1933, each post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. (4) That, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 that is incorporated by reference in the Registration Statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. II-3 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-3 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Newport Beach, State of California, on the 27th day of November, 1996. NATIONWIDE HEALTH PROPERTIES, INC. By: /s/ R. Bruce Andrews ----------------------------------------- R. Bruce Andrews President and Chief Executive Officer POWER OF ATTORNEY We, the undersigned directors and officers of Nationwide Health Properties, Inc., do hereby constitute and appoint R. Bruce Andrews and Mark L. Desmond, or either of them, our true and lawful attorneys and agents, to do any and all acts and things in our name and behalf in our capacities as directors and officers and to execute any and all instruments for us and in our names in the capacities indicated below, which said attorneys and agents, or either of them, may deem necessary or advisable to enable said corporation to comply with the Securities Act of 1933, as amended, and any rules, regulations, and requirements of the Securities and Exchange Commission, in connection with this Registration Statement, including specifically, but without limitation, power and authority to sign for us or any of us in our names and in the capacities indicated below, any and all amendments (including post-effective amendments) to this Registration Statement, or any related registration statement that is to be effective upon filing pursuant to Rule 462(b) under the Securities Act of 1933, as amended; and we do hereby ratify and confirm all that the said attorneys and agents, or either of them, shall do or cause to be done by virtue hereof. Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities indicated on the dates indicated.
SIGNATURE TITLE DATE - ---------------------------- --------------------------------------- ----------------- /s/ Milton J. Brock, Jr. Chairman and Director November 27, 1996 - ---------------------------- Milton J. Brock, Jr. /s/ R. Bruce Andrews President, Chief Executive Officer and November 27, 1996 - ---------------------------- Director (Principal executive officer) R. Bruce Andrews /s/ Mark L. Desmond Senior Vice President and Chief November 27, 1996 - ---------------------------- Financial Officer (Principal financial Mark L. Desmond and accounting officer) /s/ David R. Banks Director November 27, 1996 - ---------------------------- David R. Banks /s/ Sam A. Brooks Director November 27, 1996 - ---------------------------- Sam A. Brooks /s/ Jack D. Samuelson Director November 27, 1996 - ---------------------------- Jack D. Samuelson /s/ Charles D. Miller Director November 27, 1996 - ---------------------------- Charles D. Miller
II-4 EXHIBIT 24.1 CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS As independent public accountants, we hereby consent to the incorporation by reference in this registration statement of our reports dated January 31, 1996 included in Nationwide Health Properties, Inc.'s Form 10-K for the year ended December 31, 1995 and to all references to our Firm included in this registration statement. ARTHUR ANDERSEN LLP Orange County, California November 26, 1996 II-5 EX-4.2 2 FORM OF INDENTURE EXHIBIT 4.2 NATIONWIDE HEALTH PROPERTIES, INC. AND THE BANK OF NEW YORK, Trustee _________ INDENTURE Dated as of ___________, 1996 _________ Debt Securities TABLE OF CONTENTS ____________
Page Parties.......................................................... 1 Recitals......................................................... 1 ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION................. 1 SECTION 101. Definitions............................................. 1 "Act"............................................................... 2 "Affiliate"......................................................... 2 "Authenticating Agent".............................................. 2 "Bearer Debt Security".............................................. 2 "Beneficial Owner".................................................. 2 "Board of Directors"................................................ 2 "Board Resolution".................................................. 3 "Business Day"...................................................... 3 "Common Stock"...................................................... 3 "Company"........................................................... 3 "Company Request" and "Company Order"............................... 3 "Corporate Trust Office"............................................ 3 "Corporation"....................................................... 3 "Coupon"............................................................ 3 "Debt Security" or "Debt Securities"................................ 3 "Debt Securities Register" and "Debt Securities Registrar"....................................................... 4 "Defaulted Interest"................................................ 4 "Depositary"........................................................ 4 "Event of Default".................................................. 4 "Global Debt Security".............................................. 4 "Holder"............................................................ 4 "Indenture"......................................................... 4 "Interest Payment Date"............................................. 4 "Maturity".......................................................... 4 "Officers' Certificate"............................................. 5 "Opinion of Counsel"................................................ 5 "Original Issue Discount Debt Security"............................. 5 "Outstanding"....................................................... 5 "Paying Agent"...................................................... 6 "Person"............................................................ 6 "Place of Payment".................................................. 6 "Predecessor Debt Security"......................................... 6 "Redemption Date"................................................... 6 "Redemption Price".................................................. 7 "Registered Debt Security".......................................... 7 "Regular Record Date"............................................... 7
i "REIT"......................................................... 7 "Responsible Officer".......................................... 7 "SEC".......................................................... 7 "Special Record Date".......................................... 7 "Stated Maturity".............................................. 7 "Subsidiary"................................................... 7 "TIA".......................................................... 7 "Trustee"...................................................... 7 "Voting Stock"................................................. 8 SECTION 102. Compliance Certificates and Opinions...................... 8 SECTION 103. Form of Documents Delivered to Trustee.................... 9 SECTION 104. Acts of Holders........................................... 9 SECTION 105. Notices, Etc., to Trustee and Company..................... 11 SECTION 106. Notices to Holders; Waiver................................ 12 SECTION 107. Communication by Holders with Other Holders............... 12 SECTION 108. Effect of Headings and Table of Contents.................. 13 SECTION 109. Successors and Assigns.................................... 13 SECTION 110. Separability Clause....................................... 13 SECTION 111. Benefits of Indenture..................................... 13 SECTION 112. Governing Law............................................. 13 SECTION 113. Legal Holidays............................................ 13 SECTION 114. Trust Indenture Act Controls.............................. 14 ARTICLE TWO DEBT SECURITY FORMS...................... 14 SECTION 201. Form of Debt Securities.................................. 14 SECTION 202. Form of Trustee's Certificate of Authentication.......... 15 SECTION 203. Form of Trustee's Certificate of Authentication by an Authenticating Agent.................................. 15 SECTION 204. Provisions in Global Debt Security....................... 16 ARTICLE THREE THE DEBT SECURITIES........................ 17 SECTION 301. Amount Unlimited; Issuable in Series..................... 17
ii SECTION 302. Denominations...................................... 20 SECTION 303. Execution, Authentication, Delivery and Dating..... 20 SECTION 304. Temporary Debt Securities.......................... 22 SECTION 305. Registration, Registration of Transfer and Exchange 22 SECTION 306. Mutilated, Destroyed, Lost and Stolen Debt Securities......................................... 26 SECTION 307. Payment of Interest; Interest Rights Preserved..... 27 SECTION 308. Persons Deemed Owners.............................. 29 SECTION 309. Cancellation....................................... 29 SECTION 310. Computation of Interest............................ 30 ARTICLE FOUR SATISFACTION AND DISCHARGE................. 30 SECTION 401. Satisfaction and Discharge of Indenture............ 30 SECTION 402. Application of Trust Money......................... 31 ARTICLE FIVE REMEDIES......................... 32 SECTION 501. Events of Default.................................. 32 SECTION 502. Acceleration of Maturity; Rescission and Annulment. 34 SECTION 503. Collection of Indebtedness and Suits for Enforcement by Trustee............................. 36 SECTION 504. Trustee May File Proofs of Claim................... 37 SECTION 505. Trustee May Enforce Claims Without Possession of Debt Securities.................................... 38 SECTION 506. Application of Money Collected..................... 38 SECTION 507. Limitation on Suits................................ 38 SECTION 508. Unconditional Right of Holders to Receive Principal, Premium and Interest.................... 39 SECTION 509. Restoration of Rights and Remedies................. 39 SECTION 510. Rights and Remedies Cumulative..................... 40 SECTION 511. Delay or Omission Not Waiver....................... 40
iii SECTION 512. Control by Holders........................................... 40 SECTION 513. Waiver of Past Defaults...................................... 41 SECTION 514. Undertaking for Costs........................................ 42 SECTION 515. Waiver of Stay or Extension Laws............................. 42 ARTICLE SIX THE TRUSTEE.................................. 42 SECTION 601. Certain Duties and Responsibilities.......................... 42 SECTION 602. Notice of Defaults........................................... 44 SECTION 603. Certain Rights of Trustee.................................... 44 SECTION 604. Not Responsible for Recitals or Issuance of Debt Securities................................................... 46 SECTION 605. May Hold Debt Securities..................................... 46 SECTION 606. Money Held in Trust.......................................... 46 SECTION 607. Compensation, Reimbursement and Indemnity.................... 46 SECTION 608. Corporate Trustee Required; Eligibility...................... 47 SECTION 609. Resignation and Removal; Appointment of Successor............ 48 SECTION 610. Acceptance of Appointment by Successor....................... 50 SECTION 611. Merger, Conversion, Consolidation or Succession to Business..................................................... 51 SECTION 612. Appointment of Authenticating Agent.......................... 52 SECTION 613. Preferential Collection of Claims Against Company............ 53 SECTION 614. Reports by Trustee to Holders................................ 53 SECTION 615. Other Capacities............................................. 53 SECTION 616. Notice of Default............................................ 54 ARTICLE SEVEN HOLDERS' LISTS................................ 54 SECTION 701. Company to Furnish Trustee Names and Addresses of Holders.... 54
iv ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE; CREATION OF LIENS......................... 55 SECTION 801. Company May Consolidate, Etc.............................. 55 SECTION 802. Successor Corporation Substituted......................... 56 ARTICLE NINE SUPPLEMENTAL INDENTURES..................... 56 SECTION 901. Supplemental Indentures Without Consent of Holders.......................................... 56 SECTION 902. Supplemental Indentures with Consent of Holders........... 57 SECTION 903. Execution of Supplemental Indentures...................... 59 SECTION 904. Effect of Supplemental Indentures......................... 59 SECTION 905. Reference in Debt Securities to Supplemental Indentures................................................ 59 ARTICLE TEN COVENANTS............................. 60 SECTION 1001. Payment of Principal, Premium and Interest................ 60 SECTION 1002. Maintenance of Office or Agency........................... 60 SECTION 1003. Money for Debt Security Payments to be Held in Trust..................................................... 61 SECTION 1004. Statement as to Compliance................................ 62 SECTION 1005. Waiver of Certain Covenants............................... 63 SECTION 1006. SEC Reports............................................... 63 SECTION 1007. Limitations on Dividends, Distributions and Acquisitions of Capital Stock............................. 63 ARTICLE ELEVEN REDEMPTION OF DEBT SECURITIES................... 64 SECTION 1101. Right of Redemption....................................... 64 SECTION 1102. Election to Redeem; Notice to Trustee..................... 64 SECTION 1103. Selection by Trustee of Debt Securities to be Redeemed.................................................. 65 SECTION 1104. Notice of Redemption...................................... 65
v SECTION 1105. Deposit of Redemption Price............................... 66 SECTION 1106. Debt Securities Payable on Redemption Date................ 67 SECTION 1107. Debt Securities Redeemed in Part.......................... 67 ARTICLE TWELVE SINKING FUND........................... 68 SECTION 1201. Mandatory and Optional Sinking Fund Payments.............. 68 SECTION 1202. Satisfaction of Sinking Fund Payments with Debt Securities................................................ 68 SECTION 1203. Redemption of Debt Securities for Sinking Funds........... 69 ARTICLE THIRTEEN CONVERSION OF DEBT SECURITIES.................. 70 SECTION 1301. Conversion Privilege...................................... 70 SECTION 1302. Exercise of Conversion Privilege.......................... 70 SECTION 1303. Fractions of Shares....................................... 71 SECTION 1304. Adjustments of Conversion Price........................... 72 SECTION 1305. Notice of Adjustments of Conversion Price................. 75 SECTION 1306. Notice of Certain Corporate Action........................ 75 SECTION 1307. Taxes on Conversions...................................... 76 ARTICLE FOURTEEN RESTRICTIONS ON TRANSFER..................... 76 SECTION 1401. Restrictions on Transfer.................................. 76
vi INDENTURE, dated as of ____________, 1996 between NATIONWIDE HEALTH PROPERTIES, INC., a Maryland corporation (hereinafter called the "COMPANY"), and THE BANK OF NEW YORK, a New York state banking corporation, as Trustee hereunder (hereinafter called the "TRUSTEE"). RECITALS OF THE COMPANY The Company has duly authorized the execution and delivery of this Indenture to provide for the issuance from time to time of its unsecured and unsubordinated debt securities, unlimited as to principal amount, to bear such rates of interest, if any, to mature at such time or times, to be issued in one or more series and to have such other provisions as shall be fixed as hereinafter provided. All things necessary to make this Indenture a valid agreement of the Company, in accordance with its terms, have been done. NOW, THEREFORE, THIS INDENTURE WITNESSETH: For and in consideration of the premises and the purchase of the Debt Securities by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Debt Securities or of any series thereof, as follows: ARTICLE ONE DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION SECTION 101. Definitions. ----------- For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires: (1) the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular; (2) all other terms used herein which are defined in the TIA, either directly or by reference therein, have the meanings assigned to them therein; (3) all accounting terms not otherwise defined herein have the meanings assigned to them in accordance 1 with generally accepted accounting principles, and the term "GENERALLY ACCEPTED ACCOUNTING PRINCIPLES" with respect to any computation required or permitted hereunder shall mean such accounting principles which are generally accepted at the date or time of such computation; (4) the words "HEREIN," "HEREOF" and "HEREUNDER" and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision; (5) the word "OR" is always used inclusively (for example, the phrase "A or B" means "A or B or both," not "either A or B but not both"); and (6) nouns and pronouns of the masculine gender include the feminine gender. "ACT" when used with respect to any Holder has the meaning specified in Section 104. "AFFILIATE" of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purpose of this definition, "CONTROL" when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms, "CONTROLLING" and "CONTROLLED" have meanings correlative to the foregoing. "AUTHENTICATING AGENT" means any Person which shall at the time be appointed and acting, pursuant to Section 612, as an agent of the Trustee to authenticate Debt Securities. "BEARER DEBT SECURITY" means any Debt Security payable to bearer and, unless the context otherwise requires, all coupons appertaining thereto. "BENEFICIAL OWNER" means any Person who owns outstanding stock directly or beneficially or who is deemed to be an actual or constructive owner of such stock through the application of section 544, as modified by section 856(h)(1)(B), of the Internal Revenue Code of 1986, as amended. The terms "BENEFICIAL OWNERSHIP" and "BENEFICIALLY OWN" shall have correlative meanings. "BOARD OF DIRECTORS" means either the Board of Directors of the Company or any committee of the Board duly authorized to act in any matter relating hereto. 2 "BOARD RESOLUTION" means a copy of a resolution certified by the Secretary or an Assistant Secretary of the Company to have been duly adopted by the Board of Directors or a duly authorized committee thereof and to be in full force and effect on the date of such certification, and delivered to the Trustee. "BUSINESS DAY" with respect to any Place of Payment means each Monday, Tuesday, Wednesday, Thursday and Friday which is not a day on which banking institutions are authorized or obligated by law or executive order to close in any such Place of Payment, or such other day as provided in or pursuant to an Officers' Certificate or supplemental indenture referred to in Section 301. "COMMON STOCK" means the shares of common stock, $.10 par value per share, of the Company. "COMPANY" means the Person named as the "Company" in the first paragraph of this instrument until a successor corporation shall have become such pursuant to the applicable provisions of this Indenture, and thereafter "Company" shall mean such successor corporation. "COMPANY REQUEST" and "COMPANY ORDER" mean, respectively, a written request or order signed in the name of the Company by the Chairman of the Board, a Vice Chairman, the President, or a Vice President (whether or not designated by a number or a word or words added before or after any such title), and by the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary or an Assistant Secretary of the Company, and delivered to the Trustee. "CORPORATE TRUST OFFICE" means the office of the Trustee at which at any particular time its corporate trust business shall be principally conducted, which office, at the date of execution of this Indenture, is located at 101 Barclay Street, 21st Floor, New York, New York 10286. "CORPORATION", whether or not such term is capitalized, includes corporations, associations, companies and business trusts. "COUPON" means any interest coupon appertaining to a Bearer Debt Security. "DEBT SECURITY" or "DEBT SECURITIES" means any debt security or debt securities, as the case may be, authenticated and delivered under this Indenture. 3 "DEBT SECURITIES REGISTER" and "DEBT SECURITIES REGISTRAR" have the respective meanings specified in Section 305. "DEFAULTED INTEREST" has the meaning specified in Section 307. "DEPOSITARY" means, with respect to the Debt Securities of any series issuable or issued in whole or in part in the form of a Global Debt Security, the Person designated as Depositary by the Company pursuant to Section 301 until a successor Depositary shall have become such pursuant to the applicable procedures of this Indenture, and thereafter "Depositary" shall mean or include each Person who is then a Depositary hereunder, and if at any time there is more than one Person, "Depositary", as used with respect to the Debt Securities of any such series, shall mean the Depositary with respect to the Debt Securities of that series. "EVENT OF DEFAULT" has the meaning specified in Section 501. "GLOBAL DEBT SECURITY" means a Debt Security in the form prescribed in Section 204 evidencing all or part of a series of Debt Securities, issued to the Depositary for such series or its nominee, and registered in the name of such Depositary or nominee. "HOLDER" when used with respect to a Registered Debt Security means the Person in whose name such Debt Security is registered in the Debt Securities Register and, when used with respect to a Bearer Debt Security or a coupon, means the bearer thereof. "INDENTURE" means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof, and shall include the form and terms of particular Debt Securities as established by or pursuant to each Board Resolution pursuant to Section 201 or 301. "INTEREST PAYMENT DATE" with respect to any Debt Security means the Stated Maturity of an installment of interest on such Debt Security. "MATURITY" when used with respect to any Debt Security means the date on which the principal of such Debt Security becomes due and payable as therein or herein provided, whether at the Stated Maturity or by declaration of acceleration, call for redemption or otherwise. 4 "OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of the Board, a Vice Chairman, the President or a Vice President (whether or not designated by a number or a word or words added before or after any such title) and by the Treasurer, an Assistant Treasurer, the Controller, an Assistant Controller, the Secretary or an Assistant Secretary of the Company, and delivered to the Trustee. "OPINION OF COUNSEL" means a written opinion of counsel, who may be an employee of or counsel for the Company or other counsel designated by the Company, acceptable to the Trustee. "ORIGINAL ISSUE DISCOUNT DEBT SECURITY" means a Debt Security which provides for an amount less than the principal amount thereof to be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502. "OUTSTANDING" when used with respect to Debt Securities means, as of the date of determination, all Debt Securities theretofore authenticated and delivered under this Indenture, except: ------ (i) Debt Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; (ii) Debt Securities for whose payment or redemption money in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Debt Securities provided that, if such Debt -------- Securities are to be redeemed, notice of such redemption has been duly given pursuant to this Indenture or provision therefor satisfactory to the Trustee has been made; and (iii) Debt Securities which have been paid pursuant to Section 306 or in exchange for or in lieu of which other Debt Securities have been authenticated and delivered pursuant to this Indenture other than any such Debt Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Debt Securities are held by a bona fide purchaser in whose hands such Debt Securities are valid obligations of the Company; provided, however, that in determining whether the Holders of the requisite - -------- ------- principal amount of Outstanding Debt Securities have given any request, demand, authorization, direction, notice, consent or waiver hereunder, the principal amount of an Original Issue Discount Debt Security 5 that may be counted in making such determination and that shall be deemed to be Outstanding for such purposes shall be equal to the amount of the principal thereof that could be declared to be due and payable pursuant to the terms of such Original Issue Discount Debt Security at the time the taking of such action by the Holders of such requisite principal amount is evidenced to the Trustee as provided in Section 104(a), and, provided further, that Debt Securities owned by -------- ------- the Company or any other obligor upon the Debt Securities or any Affiliate of the Company or such other obligor shall be disregarded and deemed not to be Outstanding, except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent or waiver, only Debt Securities which a Responsible Officer of the Trustee knows to be so owned shall be so disregarded. Debt Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee's right so to act with respect to such Debt Securities and that the pledgee is not the Company or any other obligor upon the Debt Securities or any Affiliate of the Company or such other obligor. "PAYING AGENT" means any Person authorized by the Company to pay the principal of (and premium, if any) or interest, if any, on any Debt Securities on behalf of the Company, and, subject to the provisions of Section 1003, may include the Company. "PERSON" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "PLACE OF PAYMENT" when used with respect to the Debt Securities of any series means the place or places where the principal of (and premium, if any) and interest, if any, on the Debt Securities of that series are payable as provided pursuant to Section 301. "PREDECESSOR DEBT SECURITY" of any particular Debt Security means every previous Debt Security evidencing all or a portion of the same debt as that evidenced by such particular Debt Security and, for the purposes of this definition, any Debt Security authenticated and delivered under Section 306 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Debt Security shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Debt Security. "REDEMPTION DATE" when used with respect to any Debt Security to be redeemed means the date fixed for such redemption by or pursuant to this Indenture. 6 "REDEMPTION PRICE" when used with respect to any Debt Security to be redeemed means the price at which it is to be redeemed pursuant to this Indenture. "REGISTERED DEBT SECURITY" means any Debt Security registered in the Debt Securities Register. "REGULAR RECORD DATE" for the interest payable on any Interest Payment Date (other than at Maturity) on the Registered Debt Securities of any series means the date specified for that purpose as contemplated by Section 301. "REIT" means a real estate investment trust qualified under Sections 856-860 of the Internal Revenue Code of 1986, as amended. "RESPONSIBLE OFFICER" when used with respect to the Trustee means any officer of the Trustee assigned by the Trustee to administer its corporate trust matters. In the absence of bad faith on the part of the Company or a Holder, the Company or the Holder, as the case may be, may conclusively rely upon the statement of an officer of the Trustee as to whether an officer (including the officer making the statement) is assigned by the Trustee to administer the Trustee's corporate trust matters. "SEC" means the Securities and Exchange Commission. "SPECIAL RECORD DATE" for the payment of any Defaulted Interest means a date fixed by the Trustee pursuant to Section 307. "STATED MATURITY" when used with respect to any Debt Security or any installment of interest thereon means the date specified in such Debt Security as the fixed date on which the principal of such Debt Security or such installment of interest is due and payable. "SUBSIDIARY" means any corporation at least a majority of the shares of Voting Stock of which shall at the time be owned, directly or indirectly, by the Company or by one or more Subsidiaries. "TIA" means the Trust Indenture Act of 1939, as amended and as in effect on the date above written. "TRUSTEE" means the Person named as the "Trustee" in the first paragraph of this Indenture until a successor Trustee shall have become such with respect to one or more series of Debt Securities pursuant to the applicable provisions of this Indenture, and thereafter "Trustee" shall mean or include each Person who is then a Trustee hereunder, 7 and if at any time there is more than one such Person, "Trustee" as used with respect to the Debt Securities of any series shall mean exclusively the Trustee with respect to the Debt Securities of that series. "VOTING STOCK" when used with respect to the stock of any corporation means stock of the class or classes having general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of such corporation (irrespective of whether or not at the time stock of any other class or classes shall have or might have voting power by reason of the happening of any contingency). SECTION 102. Compliance Certificates and Opinions. ------------------------------------ Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee an Officers' Certificate stating that all conditions precedent, if any, provided for in this Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that in the opinion of such counsel all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents is specifically required by any provision of this Indenture relating to such particular application or request, no additional certificate or opinion need be furnished. Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include: (1) a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto; (2) a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based; (3) a statement that, in the opinion of each such individual, such individual has made such examination or investigation as is necessary to enable such individual to express an informed opinion as to whether or not such covenant or condition has been complied with; and (4) a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with. 8 For purposes of this Section 102, the term "COMPANY" (whether directly or indirectly used) also includes any other obligor. SECTION 103. Form of Documents Delivered to Trustee. -------------------------------------- In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous. Any such certificate or Opinion of Counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous. Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument. SECTION 104. Acts of Holders. --------------- (a) Any request, demand, authorization, direction, notice, consent, waiver or other action provided by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are 9 herein sometimes referred to as the "ACT" of the Holders signing such instrument or instruments. Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 601) conclusive in favor of the Trustee and the Company and any agent of the Trustee or the Company, if made in the manner provided in this Section. (b) The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by the certificate of any notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a Person acting in other than his individual capacity, such certificate or affidavit shall also constitute sufficient proof of his authority. (c) The fact and date of the execution by any Person of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient, and the Trustee may in any instance require further proof with respect to any of the matters referred to in this Section. (d) The principal amount and serial number of any Bearer Debt Security held by any Person, and the date of such Person's holding the same, may be proved by the production of such Bearer Debt Security or by a certificate executed, as depositary, by any trust company, bank, banker or other depositary, wherever situated, if such certificate shall be deemed by the Company to be satisfactory, showing that at the date therein mentioned such Person had on deposit with such depositary, or exhibited to it, the Bearer Debt Security therein described; or such facts may be proved by the certificate or affidavit of the Person holding such Bearer Debt Security, if such certificate or affidavit is deemed by the Company to be satisfactory. The Trustee and the Company may assume that such ownership of any Bearer Debt Security continues until (1) another certificate or affidavit bearing a later date issued in respect of the same Bearer Debt Security is produced, or (2) such Bearer Debt Security is produced to the Trustee by some other Person, or (3) such Bearer Debt Security is surrendered in exchange for a Registered Debt Security, or (4) such Bearer Debt Security is no longer Outstanding. The fact and date of execution of any such instrument or writing, the authority of the Person executing the same and the principal amount and serial number of any Bearer Debt Security held by the Person so executing such instrument or writing and the date of holding the same may also be proved in any other manner which the Company deems sufficient; and the Company may in any 10 instance require further proof with respect to any of the matters referred to in this Section. The principal amount and serial numbers of Registered Debt Securities held by any Person, and the date of his holding the same, shall be proved by the Debt Securities Register. (e) If the Company shall solicit from the Holders any request, demand, authorization, direction, notice, consent, waiver or other Act, the Company may, at its option, by Board Resolution, fix in advance a record date for the determination of Holders entitled to give such request, demand, authorization, direction, notice, consent, waiver or other Act, but the Company shall have no obligation to do so. If such a record date is fixed, such request, demand, authorization, direction, notice, consent, waiver or other Act may be given before or after such record date, but only the Holders at the close of business on such record date shall be deemed to be Holders for the purposes of determining whether Holders of the requisite proportion of Outstanding Debt Securities have authorized or agreed or consented to such request, demand, authorization, direction, notice, consent, waiver or other Act, and for that purpose the Outstanding Debt Securities shall be computed as of such record date; provided that no such authorization, agreement or consent by the Holders on such record date shall be deemed effective unless it shall become effective pursuant to the provisions of this Indenture not later than six months after the record date. (f) Any request, demand, authorization, direction, notice, consent, waiver or other action by the Holder of any Debt Security shall bind every future Holder of the same Debt Security and the Holder of every Debt Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done or suffered to be done by the Trustee, any Debt Securities Registrar, any Paying Agent or the Company in reliance thereon, whether or not notation of such action is made upon such Debt Security. SECTION 105. Notices, Etc., to Trustee and Company. ------------------------------------- Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with, (1) the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its Corporate Trust Office, or 11 (2) the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (except as otherwise provided in Section 501 hereof) if in writing and mailed, first-class postage prepaid, to the Company addressed to the attention of its President at 4675 MacArthur Court, Suite 1170, Newport Beach, California 92660 or at any other address previously furnished in writing to the Trustee by the Company. SECTION 106. Notices to Holders; Waiver. -------------------------- Where this Indenture provides for notice to Holders of any event, unless otherwise expressly provided herein or in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to Debt Securities of any series, such notice shall be sufficiently given if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his address as it appears in the Debt Securities Register, not later than the latest date, and not earlier than the earliest date, prescribed for the giving of such notice. In any case where notice to Holders is given by mail, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder shall affect the sufficiency of such notice with respect to other Holders. Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice. Waivers of notice by Holders shall be filed with the Trustee but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. In case by reason of any cause it shall be impracticable to give such notice, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder. SECTION 107. Communication by Holders with Other Holders. ------------------------------------------- Communication among Holders with respect to their rights under this Indenture or the Debt Securities shall be made in accordance with the provisions of TIA (S) 312(b). The Company, the Trustee, the Debt Securities Registrar or any agent thereof shall be afforded the protection provided under TIA (S) 312(c). 12 SECTION 108. Effect of Headings and Table of Contents. ---------------------------------------- The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof. SECTION 109. Successors and Assigns. ---------------------- All covenants and agreements in this Indenture by the Company shall bind its successors and assigns, whether so expressed or not. SECTION 110. Separability Clause. ------------------- In case any provision in this Indenture or in the Debt Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. SECTION 111. Benefits of Indenture. --------------------- Nothing in this Indenture or in the Debt Securities, express or implied, shall give to any Person, other than the parties hereto, any Debt Securities Registrar, any Paying Agent, any Authenticating Agent and their successors hereunder, and the Holders of Debt Securities, any benefit or any legal or equitable right, remedy or claim under this Indenture. SECTION 112. Governing Law. ------------- This Indenture and the Debt Securities shall be deemed to be a contract made under the laws of the State of New York and for all purposes shall be governed by and construed in accordance with the internal laws of the State of New York, except to the extent certain matters may be governed as a matter of law by federal law. SECTION 113. Legal Holidays. -------------- In any case where any Interest Payment Date, Redemption Date or Stated Maturity of any Debt Security shall not be a Business Day at a Place of Payment, then (notwithstanding any other provision of this Indenture or such Debt Security) payment of interest or principal (and premium, if any) need not be made on such date at such Place of Payment, but may be made on the next succeeding Business Day at such Place of Payment with the same force and effect as if made on the Interest Payment Date or Redemption Date or at the Stated Maturity, and no interest shall accrue for 13 the period from and after such Interest Payment Date, Redemption Date or Stated Maturity, as the case may be. SECTION 114. Trust Indenture Act Controls. ---------------------------- If any provision of this Indenture limits, qualifies, or conflicts with another provision which is required to be included in this Indenture by the TIA, the required provision shall control. ARTICLE TWO DEBT SECURITY FORMS SECTION 201. Form of Debt Securities. ----------------------- The Debt Securities of each series shall be in substantially the form (including any global form) as shall be established by or pursuant to a Board Resolution or in one or more indentures supplemental hereto, in each case with such appropriate insertions, omissions, substitutions and other variations as are required or permitted by this Indenture (including such other provisions as are necessary to reflect the global form of any Debt Security, and the designation of a Depositary for such Global Debt Security), and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may be required to comply with the rules of any securities exchange or other laws, rules or regulations or as may, consistently herewith, be determined by the officers executing such Debt Securities, as evidenced by their execution of the Debt Securities. The definitive Debt Securities shall be printed, lithographed or engraved or produced by any combination of these methods or may be produced in any other manner, all as determined by the officers executing such Debt Securities, as evidenced by their execution of such Debt Securities. 14 SECTION 202. Form of Trustee's Certificate of Authentication. ----------------------------------------------- The Trustee's Certificate of Authentication on all Debt Securities shall be in substantially the following form: This is one of the Debt Securities of the series designated herein referred to in the within-mentioned Indenture. [Name of Trustee], as Trustee By _________________________ Authorized Signatory SECTION 203. Form of Trustee's Certificate of Authentication by an ----------------------------------------------------- Authenticating Agent. -------------------- If at any time there shall be appointed an Authenticating Agent pursuant to Section 612, the Trustee's Certificate of Authentication by such Authenticating Agent on all Debt Securities shall be in substantially the following form: This is one of the Debt Securities of the series designated herein referred to in the within-mentioned Indenture. [Name of Trustee], as Trustee By [Name of Authenticating Agent,] Authenticating Agent By ___________________________ Authorized Signer 15 SECTION 204. Provisions in Global Debt Security. ---------------------------------- If Debt Securities of a series are issuable in whole or in part as Global Debt Securities, as specified as contemplated by Section 301, then, notwithstanding the provisions of Sections 301 and 302, any such Global Debt Security shall represent such of the Outstanding Debt Securities of such series as shall be specified therein and may provide that it shall represent the aggregate principal amount of Outstanding Debt Securities from time to time endorsed thereon and that the aggregate principal amount of Outstanding Debt Securities represented thereby may from time to time be reduced to reflect exchanges. The Global Debt Securities may be permanent or temporary. Any endorsement of a Global Debt Security to reflect the amount, or any increase or decrease in the principal amount, of Outstanding Debt Securities represented thereby shall be made by the Trustee in such manner and upon instructions given by such Person or Persons as shall be specified therein or in the Company Order to be delivered to the Trustee pursuant to Section 303 or Section 304. Subject to the provisions of Section 303 and, if applicable, Section 304, the Trustee shall deliver and redeliver any permanent Global Debt Security in the manner and upon instructions given by the Person or Persons specified therein or in the applicable Company Order. If a Company Order pursuant to Section 303 or 304 has been or simultaneously is delivered, any instructions by the Company with respect to endorsement or delivery or redelivery of a Global Debt Security shall be in writing but need not comply with Section 102 and need not be accompanied by an Opinion of Counsel. Notwithstanding the other provisions of this Indenture, unless otherwise specified as contemplated by Section 301, payment of principal of (and premium, if any) and interest, if any, on any permanent Global Debt Securities shall be made to the Person or Persons specified therein. Notwithstanding the provisions of Section 308 and except as provided in the preceding paragraph, the Company, the Trustee and any agent of the Company and the Trustee shall treat a Person as the Holder of such principal amount of Outstanding Debt Securities represented by a Global Debt Security as shall be specified in a written statement of the Depositary with respect to such Global Debt Security, only for purposes of obtaining any consents or directions required to be given by the Holders pursuant to this Indenture. Unless otherwise provided as contemplated by Section 301 with respect to any series of Debt Securities, any Global Debt Security shall provide, in addition to the 16 provisions established pursuant to Sections 201 and 301 and set forth in the preceding paragraphs, that the Depositary will not sell, assign, transfer or otherwise convey any beneficial interest in such Global Debt Security unless such beneficial interest is in an amount equal to an authorized denomination for Debt Securities of such series, and that the Depositary, by accepting such Global Debt Security, agrees to be bound by such provision. Any Global Debt Security shall also contain such other provisions as are necessary to reflect the global form of such Debt Security and the designation of a Depositary for such Global Debt Security. ARTICLE THREE THE DEBT SECURITIES SECTION 301. Amount Unlimited; Issuable in Series. ------------------------------------ The aggregate principal amount of Debt Securities which may be authenticated and delivered under this Indenture is unlimited. The Debt Securities may be issued in one or more series. There shall be established in or pursuant to a Board Resolution, and set forth in or determined in the manner described in an Officers' Certificate, or established in one or more indentures supplemental hereto: (1) the title of the Debt Securities and the series in which such Debt Securities shall be included; (2) any limit upon the aggregate principal amount of the Debt Securities of that series which may be authenticated and delivered under this Indenture (except for Debt Securities authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Debt Securities of that series pursuant to Section 304, 305, 306, 905 or 1107) and the percentage of their principal amount at which the Debt Securities will be issued; (3) the date or dates on which the principal of the Debt Securities of that series is payable or the manner of determining the same; (4) the rate or rates at which the Debt Securities of that series shall bear interest, if any, or the manner of determining the same, the date or dates from which such interest shall accrue, or the manner of determining the same, the Interest Payment Dates on which such interest shall be payable and the Regular 17 Record Date for the determination of Holders to whom interest shall be payable on any Interest Payment Date, and the basis upon which interest shall be calculated if other than that of a year of twelve 30-day months; (5) the place or places where the principal of (and premium, if any) and interest, if any, on the Debt Securities of that series shall be payable and the method of such payment; (6) the period or periods within which, the price or prices at which and the terms and conditions upon which the Debt Securities of that series may be redeemed, in whole or in part, at the option of the Company; (7) the obligation, if any, of the Company to redeem or purchase Debt Securities of that series pursuant to any sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which and the terms and conditions upon which Debt Securities of that series shall be redeemed or purchased, in whole or in part, pursuant to such obligation; (8) if other than denominations of U.S. $100,000 and any integral multiple of U.S. $1,000 above U.S. $100,000, the denominations in which the Debt Securities of that series shall be issuable; (9) if other than the principal amount thereof, the portion of the principal amount of the Debt Securities of that series which shall be payable upon declaration of acceleration of the Maturity thereof pursuant to Section 502; (10) the currency or currencies, including composite currencies or units of two or more currencies, in which the payment of the principal of (and premium, if any) and interest on the Debt Securities of that series shall be payable (if other than currency of the United States of America); (11) the provisions, if any, relating to the conversion or exchange of the Debt Securities of any series into Debt Securities of another series or into Common Stock; (12) any additional covenants and events of default and the remedies with respect thereto concerning the Debt Securities of that series if not set forth herein; 18 (13) whether any Debt Securities of the series are to be issued in whole or in part in the form of one or more Global Debt Securities and, if so, the Depositary for such Global Debt Security or Debt Securities (which Depositary shall be, if then required by applicable law or regulation, a clearing agency registered under the Securities Exchange Act of 1934, as amended, and any other applicable statute or regulation) and whether beneficial owners of interests in such Global Debt Security or Debt Securities may exchange such interests for Debt Securities of such series and of like tenor and of any authorized form and denomination and the circumstances under which any such exchanges may occur, if other than in the manner provided in Section 305); (14) the identity of the Trustee for the Debt Securities of the series and if not the Trustee, the identity of each Paying Agent and Debt Securities Registrar for the Debt Securities of the series; and (15) any other terms of the Debt Securities of that series. All Debt Securities of any one series shall be substantially identical except as to denomination, currency, the rate or rates of interest, if any, and the Maturity and except as may otherwise be provided in or pursuant to such Board Resolution and set forth or determined in the manner described in such Officers' Certificate, or in any such indenture supplemental hereto. All Debt Securities of any one series need not be issued at the same time, and, unless otherwise provided, a series may be reopened for issuances of additional Debt Securities of that series. Unless otherwise established in or pursuant to an Officers' Certificate, or in one or more indentures supplemental hereto, at the option of the Company, interest on the Debt Securities of any series that bears interest may be paid by mailing a check to the address of the person entitled thereto as such address shall appear in the Debt Securities Register. If the form of Debt Securities of any series is established by action taken pursuant to a Board Resolution, an appropriate Officers' Certificate setting forth such form together with a copy of the Board Resolution shall be delivered to the Trustee at or prior to the delivery of the order contemplated by Section 303 for the authentication and delivery of such Debt Securities. 19 SECTION 302. Denominations. ------------- The Debt Securities of each series may be issued as Bearer Debt Securities, as Registered Debt Securities or in any combination thereof, and in such denominations and amounts, all as from time to time set forth in an Officers' Certificate or supplemental indenture referred to in Section 301. SECTION 303. Execution, Authentication, Delivery and Dating. --------------------------------------- ------ The Debt Securities shall be executed on behalf of the Company by its Chairman of the Board or its President or one of its Vice Presidents (whether or not designated by a number or a word or words added before or after any such title) under its corporate seal reproduced thereon and attested by its Secretary or one of its Assistant Secretaries. The signature of any or all of these officers on the Debt Securities may be manual or facsimile. Debt Securities bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Debt Securities or did not hold such offices at the dates of such Debt Securities. At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Debt Securities of any series executed by the Company to the Trustee for authentication, together with the Officers' Certificate or supplemental indenture with respect to such Debt Securities referred to in Section 301 and a Company Order for the authentication and delivery of such Debt Securities, and the Trustee, in accordance with Company Order, but subject to the provisions hereof, shall authenticate and deliver such Debt Securities. Such Company Order may provide that Debt Securities which are the subject thereof will be authenticated and delivered by the Trustee upon the order of Persons designated in said Company Order communicated to the Trustee in writing or by telephone or other means set forth in such Company Order and that such Persons are authorized to determine such terms and conditions of said Debt Securities as are specified in the Company Order. In authenticating such Debt Securities, and accepting the additional responsibilities under this Indenture in relation to such Debt Securities, the Trustee shall be entitled to receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating, 20 (a) that the form and terms of such Debt Securities have been established in conformity with the provisions of this Indenture; and (b) that all conditions precedent to the authentication and delivery of such Debt Securities have been complied with and that such Debt Securities, when completed by appropriate insertions, authenticated and delivered by the Trustee, issued by the Company and sold in the manner and subject to any conditions specified in such Opinion of Counsel, will constitute valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium, conservatorship, receivership and similar laws relating to or affecting creditors' rights generally (including, without limitation, fraudulent conveyance laws) and by general principles of equity, including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief, regardless of whether considered in a proceeding in equity or at law. If all the Debt Securities of any series are not to be issued at one time, it shall not be necessary to deliver an Opinion of Counsel at the time of issuance of each Debt Security, but such opinion, with appropriate modifications, shall be delivered at or before the time of issuance of the first Debt Security of such series. The Trustee shall not be required to authenticate such Debt Securities if the issue of such Debt Securities pursuant to this Indenture will affect the Trustee's own rights, duties or immunities under the Debt Securities and this Indenture or otherwise in a manner which is not reasonably acceptable to the Trustee or if the Trustee being advised by counsel determines that such action may not lawfully be taken. Each Debt Security shall be dated the date of its authentication. No Debt Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose, unless there appears on such Debt Security a certificate of authentication substantially in the form provided for herein executed by the Trustee by the manual signature of one of its authorized signatories or authorized Authenticating Agents, and such certificate upon any Debt Security shall be conclusive evidence, and the only evidence, that such Debt Security has been duly authenticated and delivered hereunder. 21 SECTION 304. Temporary Debt Securities. ------------------------- Pending the preparation or distribution of definitive Debt Securities of any series, the Company may execute and deliver to the Trustee, and upon Company Order the Trustee shall authenticate and deliver in the manner provided in Section 303, a temporary Debt Security or temporary Debt Securities of that series which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the definitive Debt Securities in lieu of which they are issued or in such form as may be prescribed in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to such Debt Securities, and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Debt Securities may determine, as evidenced by the their execution of such Debt Securities. Except in the case of temporary Global Debt Securities, which shall be exchanged in accordance with the provisions thereof, if temporary Debt Securities are issued, the Company shall cause definitive Debt Securities to be prepared without unreasonable delay. After the preparation of definitive Debt Securities, the temporary Debt Security or temporary Debt Securities of that series shall be exchanged for definitive Debt Securities of that series containing identical terms and provisions upon surrender of the temporary Debt Securities of that series, at an office or agency of the Company maintained for such purpose pursuant to Section 1002, without charge to the Holder, or in such other manner as set forth in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to such Debt Securities. Upon surrender for cancellation of any one or more temporary Debt Securities of any series, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of definitive Debt Securities of authorized denominations of the same series containing identical terms and provisions. Except as set forth in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to such Debt Securities, until so exchanged, the temporary Debt Securities of any series shall in all respects be entitled to the same benefits under this Indenture as definitive Debt Securities of that series authorized and delivered hereunder. SECTION 305. Registration, Registration of Transfer and Exchange. --------------------------------------------------- The Company shall cause to be kept at the office of the Debt Securities Registrar designated pursuant to this Section 305 or Section 1002 a register (herein sometimes 22 referred to as the "DEBT SECURITIES REGISTER") in which, subject to such reasonable regulations as it may prescribe, the Company shall provide for the registration of each series of Debt Securities and of transfers of each series of Debt Securities. The Trustee is hereby initially appointed "DEBT SECURITIES REGISTRAR" for the purpose of registering Debt Securities and transfers of Debt Securities as herein provided. Except as set forth in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to any Debt Securities of a series, upon surrender for registration of transfer of any Debt Security of any series at any office or agency of the Company maintained for such purpose pursuant to Section 1002, the Company shall execute, and the Trustee shall authenticate and deliver, in the name of the designated transferee or transferees, one or more new Debt Securities of authorized denominations of the same series containing identical terms and provisions, of a like aggregate principal amount. Except as set forth in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to any Debt Securities of a series, at the option of the Holder, Debt Securities of any series may be exchanged for other Debt Securities of authorized denominations of the same series containing identical terms and provisions, of like aggregate principal amount, upon surrender of the Debt Securities to be exchanged at such office or agency. Whenever any Debt Securities are so surrendered for exchange, the Company shall execute, and the Trustee shall authenticate and deliver, the Debt Securities which the Holder making the exchange is entitled to receive. All Debt Securities issued upon any registration of transfer or exchange of Debt Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Debt Securities surrendered upon such registration of transfer or exchange. Every Debt Security presented or surrendered for registration of transfer or for exchange shall (if so required by the Company or the Debt Securities Registrar for that series of Debt Security presented) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the Debt Securities Registrar duly executed, by the Holder thereof or his attorney duly authorized in writing. No service charge shall be made for any registration of transfer or exchange of Debt Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Debt Securities, other than exchanges pursuant to Section 304, 905 or 1107 not involving any transfer. The Company shall not be required (a) to exchange Bearer Debt Securities for Registered Debt Securities during the period between the close of business on each Regular Record Date (or any Special Record Date) and the opening of business on the next succeeding Interest Payment Date (or the related date for payment of Defaulted Interest), or (b) in the event of redemption in part, (i) to register the transfer of or exchange Registered Debt Securities or to exchange Bearer Debt Securities for Registered Debt Securities for a period of 15 days immediately preceding the date notice is given identifying the serial numbers of the Debt Securities called for such redemption; (ii) to register the transfer of or exchange any Registered Debt Securities, or portion thereof, called for redemption except, in the case of any Registered Debt Securities to be redeemed in part, the unredeemed portion of such Registered Debt Securities being redeemed in part; or (iii) to exchange any such Bearer Debt Securities called for redemption; provided, however, that in the case of both (a) and (b) a -------- ------- Bearer Debt Security called for redemption may be exchanged for a Registered Debt Security which is simultaneously surrendered, with written instructions for payment on the Redemption Date. The Company also shall not be required to exchange Bearer Debt Securities for Registered Debt Securities, if, as a result thereof, the Company would incur adverse consequences under United States federal income tax laws in effect at the time of such exchange. If at any time the Depositary for the Debt Securities of a series issued in the form of one or more Global Debt Securities notifies the Company that it is unwilling or unable to continue as Depositary for the Debt Securities of such series or if at any time the Depositary for the Debt Securities of such series shall no longer be eligible under Section 301, the Company shall appoint a successor Depositary with respect to the Debt Securities of such series. If a successor Depositary for the Debt Securities of such series is not appointed by the Company within ninety (90) days after the Company receives such notice or becomes aware of such ineligibility, the Company's election to issue Global Debt Securities pursuant to Section 301 shall no longer be effective with respect to the Debt Securities of such series and the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Debt Securities of such series, will authenticate and deliver, Debt Securities of such series in definitive form in an aggregate principal amount equal to the principal amount of the Global Debt 24 Security or Debt Securities representing such series in exchange for such Global Debt Security or Debt Securities. The Company may at any time and in its sole discretion determine that the Debt Securities of any series issued in the form of one or more Global Debt Securities shall no longer be represented by such Global Debt Security or Debt Securities. In such event the Company will execute, and the Trustee, upon receipt of a Company Order for the authentication and delivery of definitive Debt Securities of such series, will authenticate and deliver, Debt Securities of such series in definitive form, in authorized denominations, and in an aggregate principal amount equal to the principal amount of the Global Debt Security or Debt Securities representing such series in exchange for such Global Debt Security or Debt Securities. Unless and until a Global Debt Security is exchanged in whole or in part for Debt Securities in definitive form in accordance with the provisions of this Indenture, a Global Debt Security may not be transferred except as a whole by the Depositary with respect to such Global Debt Security to a nominee of such Depositary or by a nominee of such Depositary to such Depositary or another nominee of such Depositary or by such Depositary or any such nominee to a successor of such Depositary or a nominee of such successor. Unless otherwise provided as contemplated by Section 301 with respect to any series of Debt Securities evidenced in whole or in part by a Global Debt Security, the Depositary may not sell, assign, transfer or otherwise convey any beneficial interest in a Global Debt Security evidencing all or part of the Debt Securities of such series unless such beneficial interest is in an amount equal to an authorized denomination for Debt Securities of such series. Notwithstanding the foregoing, except as otherwise specified as contemplated by Section 301, any Global Debt Security shall be exchangeable only as provided in this paragraph. If the beneficial owners of interests in a Global Debt Security are entitled to exchange such interests for Debt Securities of such series and of like tenor and principal amount of another authorized form and denomination, as specified as contemplated by Section 301, then without unnecessary delay but in any event not later than one Business Day prior to the earliest date on which such interests may be so exchanged, the Company shall deliver to the Trustee definitive Debt Securities of such series in aggregate principal amount equal to the principal amount of such Global Debt Securities, executed by the Company. On or after the earliest date on which such interests may be so exchanged such Global Debt Securities shall be surrendered by the Depositary as shall be specified in the Company Order with respect thereto to the Trustee, as 25 the Company's agent for such purpose, to be exchanged, in whole or from time to time in part, for definitive Debt Securities of such series without charge and the Trustee shall authenticate and deliver, in exchange for each portion of such Global Debt Securities, a like aggregate principal amount of definitive Debt Securities of the same series of authorized denominations and of like tenor as the portion of such Global Debt Securities to be exchanged as shall be specified by the Depositary; provided, however, that no such exchanges may occur for a -------- ------- period of 15 days immediately preceding the date notice is given identifying the serial numbers of the Debt Securities called for redemption; if a Registered Debt Security of any series is issued in exchange for any portion of a Global Debt Security after the close of business at the office or agency where such exchange occurs on (1) any Regular Record Date and before the opening of business at such office or agency on the relevant Interest Payment Date, or (2) any Special Record Date and before the opening of business at such office or agency on the related proposed date for payment of Defaulted Interest, interest or Defaulted Interest, as the case may be, will not be payable on such Interest Payment Date or proposed date for payment, as the case may be, in respect to such Registered Debt Securities, but will be payable on such Interest Payment Date or proposed date for payment, as the case may be, only to the Person to whom interest in respect of such portion of such Global Debt Securities is payable in accordance with the provisions of this Indenture. SECTION 306. Mutilated, Destroyed, Lost and Stolen Debt Securities. ----------------------------------------------------- If there is delivered to the Trustee any mutilated Debt Security and such security or indemnity as may be required by the Trustee to save the Trustee and the Company harmless, then the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a new Debt Security of the same series of like tenor and principal amount and bearing a number not contemporaneously outstanding. If there be delivered to the Company and to the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Debt Security, and (ii) such security or indemnity as may be required by them to save each of them harmless, then, in the absence of notice to the Company or the Trustee that such Debt Security has been acquired by a bona fide purchaser, the Company shall execute and upon its request the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Debt Security, a new Debt Security of the same series of like tenor and principal amount and bearing a number not contemporaneously outstanding. 26 In case any such mutilated, destroyed, lost or stolen Debt Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Debt Security, pay such Debt Security. Upon the issuance of any new Debt Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. Every new Debt Security of any series issued pursuant to this Section in lieu of any destroyed, lost or stolen Debt Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Debt Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Debt Securities of that series duly issued hereunder. The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Debt Securities. SECTION 307. Payment of Interest; Interest Rights Preserved. ---------------------------------------------- Interest on any Registered Debt Security which is payable, and is punctually paid or duly provided for, on any Interest Payment Date shall, if so provided in such Registered Debt Security, be paid to the Person in whose name such Registered Debt Security (or one or more Predecessor Debt Securities) is registered at the close of business on the Regular Record Date for such interest, unless interest is payable at Maturity, in which case interest shall be paid to the Person entitled to receive payment of the principal of such Registered Debt Security at Maturity. Any interest on any Registered Debt Security of any series which is payable, but is not punctually paid or duly provided for, on any Interest Payment Date for such Registered Debt Security (herein called "DEFAULTED INTEREST") shall forthwith cease to be payable to the Holder on the relevant Regular Record Date by virtue of having been such Holder; and such Defaulted Interest may be paid by the Company, at its election in each case as provided in Clause (1) or (2) below: (1) The Company may elect to make payment of any Defaulted Interest to the Persons in whose names the 27 Registered Debt Securities affected (or their respective Predecessor Debt Securities) are registered at the close of business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each such Registered Debt Security and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this Clause (1) provided. Thereupon the Trustee shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 10 days after the receipt by the Trustee of the notice of the proposed payment. The Trustee shall promptly notify the Company of such Special Record Date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be mailed, first-class postage prepaid, to each Holder of such Registered Debt Securities at his address as it appears in the Debt Securities Register not less than 10 days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been mailed as aforesaid, such Defaulted Interest shall be paid to the Persons in whose names such Registered Debt Securities (or their respective Predecessor Debt Securities) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the following Clause (2). (2) The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Registered Debt Securities affected may be listed, and upon such notice as may be required by such exchange, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this Clause (2), such payment shall be deemed practicable by the Trustee. Subject to the foregoing provisions of this Section, each Debt Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Debt Security shall carry the rights to 28 interest accrued and unpaid, and to accrue, which were carried by such other Debt Security. SECTION 308. Persons Deemed Owners. --------------------- The Company, the Trustee and any agent of the Company or the Trustee may treat the bearer of any Bearer Debt Security as the owner of such Debt Security for the purpose of receiving payment of principal of (and premium, if any) and any interest, if any, on such Bearer Debt Security and for all other purposes whatsoever, whether or not such Debt Security is overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary. Prior to due presentment of a Debt Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Debt Security is registered as the owner of such Debt Security for the purpose of receiving payment of principal of (and premium, if any) and (subject to Section 307) interest, if any, on such Debt Security and for all other purposes whatsoever, whether or not such Debt Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary. Notwithstanding the foregoing, with respect to any Global Debt Security, nothing herein shall prevent the Company, the Trustee, or any agent of the Company or the Trustee, from giving effect to any written certification, proxy or other authorization furnished by a Depositary or impair, as between a Depositary and holders of beneficial interests in any Global Debt Security, the operation of customary practices governing the exercise of the rights of the Depositary as Holder of such Global Debt Security. SECTION 309. Cancellation. ------------ All Debt Securities surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee, and any such Debt Securities and Debt Securities surrendered directly to the Trustee for any such purpose shall (i) in the case of Bearer Debt Securities, be retained in the possession of the Trustee for the purpose of reissuance upon subsequent exchanges, and the Trustee, prior to reissuance of any such Bearer Debt Security, shall detach therefrom and cancel all matured coupons, or, at the discretion of the Trustee, be cancelled promptly by the Trustee, and (ii) in the case of Registered Debt Securities, be cancelled promptly by the Trustee. The Company may at any time deliver to the Trustee for cancellation any Debt Securities previously authenticated and 29 delivered hereunder which the Company may have acquired in any manner whatsoever, and all Debt Securities so delivered shall be promptly cancelled by the Trustee unless otherwise instructed by the Company. No Debt Securities shall be authenticated in lieu of or in exchange for any Debt Securities cancelled as provided in this Section, except as expressly permitted by this Indenture. Upon written instructions of the Company, all cancelled Debt Securities shall be returned to the Company upon the written request of the Company. SECTION 310. Computation of Interest. ----------------------- Except as otherwise specified as contemplated by Section 301 for Debt Securities of any series, interest on the Debt Securities of each series shall be computed on the basis of a year of twelve 30-day months. ARTICLE FOUR SATISFACTION AND DISCHARGE SECTION 401. Satisfaction and Discharge of Indenture. --------------------------------------- This Indenture shall cease to be of further effect (except as otherwise specifically provided herein and to any surviving rights of registration of transfer, conversion or exchange of Debt Securities herein expressly provided for), and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when (1) either (A) all Debt Securities theretofore authenticated and delivered (other than (i) coupons appertaining to Bearer Debt Securities surrendered for exchange for Registered Debt Securities and maturing after such exchange, whose surrender has been waived, (ii) Debt Securities which have been destroyed, lost or stolen and which have been replaced or paid as provided in Section 306, (iii) coupons appertaining to Bearer Debt Securities called for redemption and maturing after the relevant Redemption Date, whose surrender has been waived, and (iv) Debt Securities for whose payment money has theretofore been deposited in trust or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in Section 1003), have been delivered to the Trustee for cancellation; or 30 (B) all such Debt Securities not theretofore delivered to the Trustee for cancellation (i) have become due and payable, or (ii) will become due and payable at their Stated Maturity within one year, or (iii) if redeemable at the option of the Company, are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company, and the Company, in the case of (i), (ii) or (iii) of paragraph (B) above, has deposited or caused to be deposited with the Trustee as trust funds in trust for the purpose an amount sufficient to pay and discharge the entire indebtedness on such Debt Securities not theretofore delivered to the Trustee for cancellation, for principal (and premium, if any) and interest, if any, to the date of such deposit (in the case of Debt Securities which have become due and payable) or to the Stated Maturity or Redemption Date, as the case may be: (2) the Company has paid or caused to be paid all other sums payable hereunder by the Company; and (3) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Indenture have been complied with. Notwithstanding the satisfaction and discharge of this Indenture, the obligations of the Company to the Trustee under Sections 607 and 612 and the obligations of the Trustee to any Authenticating Agent under Section 612 and, if money shall have been deposited with the Trustee pursuant to paragraph (B) of this Section, the rights, powers, protections, trusts, duties and indemnities of the Trustee hereunder, the Company's obligations with respect to such Debt Securities under Sections 304, 305, 306, 1002, 1003 and 1006, the obligations of the Trustee under Section 402 and the last paragraph of Section 1003, shall survive. SECTION 402. Application of Trust Money. -------------------------- Subject to the provisions of the last paragraph of Section 1003, all money deposited with the Trustee pursuant to Section 401 shall be held in trust and applied by it, in accordance with the provisions of the Debt Securities and 31 this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium, if any) and interest, if any, for whose payment such money has been deposited with the Trustee. ARTICLE FIVE REMEDIES SECTION 501. Events of Default. ----------------- "EVENT OF DEFAULT" wherever used herein with respect to Debt Securities of any series, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule, or regulation of any administrative or governmental body): (1) default in the payment of any interest upon any Debt Security of that series when it becomes due and payable, and continuance of such default for a period of 30 days; or (2) default in the payment of the principal of (and premium, if any) on any Debt Security of that series when it becomes due and payable at its Maturity; or (3) default in the deposit of any sinking fund payment when the same shall become due and payable by the terms of any Debt Security of that series; or (4) default in the performance, or breach, of any covenant or warranty of the Company in this Indenture (other than a covenant or warranty a default in whose performance or whose breach is elsewhere in this Section specifically dealt with or which has been expressly included in this Indenture solely for the benefit of a series of Debt Securities other than that series), and continuance of such default or breach for a period of 60 days after there has 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 10% in principal amount of the Outstanding Debt Securities of that series a written notice specifying such default or breach and requiring it to be remedied and stating that such notice is a "NOTICE OF DEFAULT" hereunder; or 32 (5) a receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator or other similar official shall take possession of the Company or any substantial part of its property without its consent, or the entry of a decree or order for relief by a court having jurisdiction in the premises in respect of the Company in an involuntary case under the Federal Bankruptcy Code or any other applicable Federal or State law, or appointing a receiver, liquidator, custodian, assignee, trustee, sequestrator, conservator, or other similar official of the Company or of any substantial part of its property, or ordering the winding up or liquidation of its affairs, and the continuance of any such possession, decree or order unstayed and in effect for a period of 60 consecutive days; or (6) the commencement by the Company of a voluntary case under the Federal Bankruptcy Code or any other applicable Federal or State law, or the consent by either of the foregoing to the entry of an order for relief in an involuntary case under any such law, or the consent by the Company to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator or other similar official of the Company or of any substantial part of its property, or the making by the Company of an assignment for the benefit of creditors; or (7) a default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any indebtedness for money borrowed by the Company (including this Indenture), whether such indebtedness now exists or shall hereafter be created, which default shall constitute a failure to pay principal of such indebtedness in an amount exceeding $10,000,000 when due and payable (other than as a result of acceleration), after expiration of any applicable grace period with respect thereto, or shall have resulted in such indebtedness, in an aggregate principal amount exceeding $10,000,000, 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 10 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 Debt Securities of that series, a written notice specifying such default and requiring the Company to cause such indebtedness to be discharged or such acceleration to be rescinded or 33 annulled and stating that such notice is a "Notice of Default" hereunder; provided, however, that any such event of default shall not be deemed to -------- ------- have occurred so long as the Company shall contest the validity thereof in good faith by appropriate proceedings (notwithstanding the foregoing, the Trustee shall be obligated to provide the notice specified in Section 602); or (8) any other event of default provided with respect to Debt Securities of that series. SECTION 502. Acceleration of Maturity; Rescission and Annulment. -------------------------------------------------- If an Event of Default occurs with respect to Debt Securities of any series and is continuing, then and in every such case the Trustee (upon obtaining knowledge of such Event of Default) or the Holders of not less than 25% in principal amount of the Outstanding Debt Securities of that series may declare the principal of all the Debt Securities of that series, or if the Debt Securities of that series are Original Issue Discount Debt Securities, such portion of the principal amount as may be specified in the terms of that series, to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by Holders), and upon any such declaration such principal shall become immediately due and payable. At any time after such a declaration of acceleration with respect to Debt Securities of any series has been made and before a judgment or decree for payment of the money due has been obtained by the Trustee as hereinafter in this Article provided, the Holders of a majority in principal amount of the Outstanding Debt Securities of that series, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if (1) the Company has paid or deposited with the Trustee a sum sufficient to pay (A) all overdue installments of interest, if any, on all Debt Securities of that series, (B) the principal of (and premium, if any, on) any Debt Securities of that series which have become due otherwise than by such declaration of acceleration and interest thereon at the rate or rates borne by or provided for in such Debt Securities, 34 (C) to the extent that payment of such interest is lawful, interest upon overdue installments of interest at the rate or rates borne by or provided for in such Debt Securities, and (D) all sums paid or advanced by the Trustee hereunder and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel; and (2) all Events of Default with respect to Debt Securities of that series, other than the non-payment of the principal of Debt Securities of that series which has become due solely by such acceleration, have been cured or waived as provided in Section 513. No such rescission shall affect any subsequent default or impair any right consequent thereon. Upon receipt by the Trustee of any declaration of acceleration given by a Holder of a Debt Security or by a Person who is the beneficial owner of an interest in a Global Debt Security (as conclusively established by the Depositary's records or rescission and annulment thereof, with respect to Debt), Securities of a series all or part of which is represented by a Global Debt Security, the Trustee shall establish a record date for determining Holders of Outstanding Debt Securities of such series entitled to join in such declaration of acceleration, or rescission and annulment, as the case may be, which record date shall be at the close of business on the day the Trustee receives such declaration of acceleration, or rescission and annulment, as the case may be. The Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to join in such declaration of acceleration, or rescission and annulment, as the case may be, whether or not such Holders remain Holders after such record date; provided, that unless such declaration of -------- acceleration, or rescission and annulment, as the case may be, shall have become effective by virtue of the requisite percentage having been obtained prior to the day which is ninety (90) days after such record date, such declaration of acceleration, or rescission and annulment, as the case may be, shall automatically without further action by any Holder be cancelled and of no further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of a Holder, from giving, after expiration of such ninety (90) day period, a new declaration of acceleration, or rescission or annulment thereof, as the case may be, that is identical to a declaration of acceleration, or rescission or annulment thereof, which has been cancelled pursuant to the proviso to the preceding sentence, in which event a new record date 35 shall be established pursuant to the provisions of this Section 502. SECTION 503. Collection of Indebtedness and Suits for Enforcement by ------------------------------------------------------- Trustee. ------- The Company covenants that if (1) default is made in the payment of any installment of interest on any Debt Security when such interest becomes due and payable and such default continues for a period of 30 days, or (2) default is made in the payment of the principal of (or premium, if any, on) any Debt Security at the Maturity thereof or in the deposit of any sinking fund payment, if any, when the same shall have become payable, the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Debt Securities, the whole amount then due and payable on such Debt Securities for principal (and premium, if any) and interest, if any, with interest upon the overdue principal (and premium, if any) and, to the extent that payment of such interest is lawful, upon overdue installments of interest, at the rate or rates borne by or provided for in such Debt Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel. If the Company fails to pay such amounts forthwith upon such demand, the Trustee, in its own name and as trustee of an express trust, may institute a judicial proceeding for the collection of the sums so due and unpaid, and may prosecute such proceeding to judgment or final decree, and may enforce the same against the Company or any other obligor upon the Debt Securities and collect the moneys adjudged or decreed to be payable in the manner provided by law out of the property of the Company or any other obligor upon the Debt Securities wherever situated. If an Event of Default with respect to the Debt Securities of any series occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders of Debt Securities of that series by such appropriate judicial proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy. 36 SECTION 504. Trustee May File Proofs of Claim. -------------------------------- In case of the pendency of any receivership, conservatorship, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition or other judicial or other proceeding relative to the Company or any other obligor upon the Debt Securities or the property of the Company or of such other obligor or their creditors, the Trustee (irrespective of whether the principal of the Debt Securities shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of whether the Trustee shall have made any demand on the Company for the payment of overdue principal or interest) shall be entitled and empowered, by intervention in such proceeding or otherwise, (1) to file and prove a claim for the whole amount of principal (and premium, if any) and interest, if any, owing and unpaid in respect of the Debt Securities and to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and of the Holders allowed in such judicial proceeding, and (2) to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any receiver, liquidator, assignee, custodian, trustee, conservator, sequestrator or other similar official in any such judicial or other proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 607. Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Debt Securities or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding. 37 SECTION 505. Trustee May Enforce Claims Without Possession of Debt ----------------------------------------------------- Securities. ---------- All rights of action and claims under this Indenture or any of the Debt Securities may be prosecuted and enforced by the Trustee without the possession of any of the Debt Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Debt Securities in respect of which such judgment has been recovered. SECTION 506. Application of Money Collected. ------------------------------ Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal (or premium, if any) or interest, if any, upon presentation of the Debt Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid: FIRST: To the payment of all amounts due the Trustee under Section 607; SECOND: To the payment of the amounts then due and unpaid upon the Debt Securities for principal (and premium, if any) and interest, if any, in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Debt Securities for principal (and premium, if any) and interest, if any, respectively; and THIRD: The balance, if any, to the Company or any other Person or Persons entitled thereto. SECTION 507. Limitation on Suits. ------------------- No Holder of any Debt Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless (1) such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to the Debt Securities of that series; 38 (2) the Holders of not less than 25% in principal amount of the Outstanding Debt Securities of that series have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder; (3) such Holder or Holders have offered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request; (4) the Trustee for 60 days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and (5) no direction inconsistent with such written request has been given to the Trustee during such 60 day period by the Holders of a majority in principal amount of the Outstanding Debt Securities of that series; it being understood and intended that no one or more Holders of Debt Securities of any series shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Holders of Debt Securities of that series or of any other series, or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all the Holders of Debt Securities of that series. SECTION 508. Unconditional Right of Holders to Receive Principal, Premium ------------------------------------------------------------ and Interest. ------------ Notwithstanding any other provision in this Indenture, the Holder of any Debt Security shall have the right, which is absolute and unconditional, to receive payment of the principal of (and premium, if any) and (subject to Section 307) interest (including any additional interest provided for in an Officers' Certificate or supplemental indenture referred to in Section 301 with respect to any Debt Securities of a series), if any, on such Debt Security on the respective Stated Maturities expressed in such Debt Security (or, in the case of redemption, on the Redemption Date) and to institute suit for the enforcement of any such payment, and such right shall not be impaired without the consent of such Holder. SECTION 509. Restoration of Rights and Remedies. ---------------------------------- If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this 39 Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then, subject to any determination in such proceeding, and in every such case the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder, and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted. SECTION 510. Rights and Remedies Cumulative. ------------------------------ No right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy. SECTION 511. Delay or Omission Not Waiver. ---------------------------- To the extent permitted by law, no delay or omission of the Trustee or of any Holder of any Debt Security to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be. SECTION 512. Control by Holders. ------------------ Subject to Section 503, the Holders of a majority in principal amount of the Outstanding Debt Securities of any series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee with respect to Debt Securities of that series, provided that -------- (1) such direction shall not be in conflict with any rule of law or with this Indenture, (2) the Trustee shall not determine that the action so directed would be unjustly prejudicial to Holders of Debt Securities of that series, or any other series not taking part in such direction, and 40 (3) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. Upon receipt by the Trustee of any purported direction with respect to Debt Securities of a series all or part of which is represented by a Global Debt Security, the Trustee shall establish a record date for determining Holders of Outstanding Debt Securities of such series entitled to join in such direction, which record date shall be at the close of business on the day the Trustee receives such direction. The Holders on such record date, or their duly designated proxies, and only such Persons, shall be entitled to join in such direction, whether or not such Holders remain Holders after such record date; provided, that unless such majority in principal amount shall have been obtained - -------- prior to the day which is ninety (90) days after such record date, such direction shall automatically and without further action by any Holder be cancelled and of no further effect. Nothing in this paragraph shall prevent a Holder, or a proxy of a Holder, from giving, after expiration of such ninety (90) day period, a new direction identical to a direction which has been cancelled pursuant to the proviso to the preceding sentence, in which event a new record date shall be established pursuant to the provisions of this Section 512. SECTION 513. Waiver of Past Defaults. ----------------------- The Holders of not less than a majority in principal amount of the Outstanding Debt Securities of any series may on behalf of the Holders of all the Debt Securities of that series waive any past default hereunder with respect to that series and its consequences, except a default (1) in the payment of the principal of (or premium, if any) or interest, if any, on any Debt Security of that series, or (2) in respect of a covenant or provision hereof which under Article Nine cannot be modified or amended without the consent of the Holder of each Outstanding Debt Security of that series affected. Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon. 41 SECTION 514. Undertaking for Costs. --------------------- All parties to this Indenture agree, and each Holder of any Debt Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant in such suit, other than the Trustee, of an undertaking to pay the costs of such suit, and that such court may in its discretion assess reasonable costs, including reasonable attorneys' fees, against any party litigant in such suit, including the Trustee, having due regard to the merits and good faith of the claims or defenses made by such party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, or any suit instituted by any Holder, or group of Holders, holding in the aggregate more than 10% in principal amount of the Outstanding Debt Securities of any series, or to any suit instituted by any Holder for the enforcement of the payment of the principal of (or premium, if any) or interest, if any, on any Debt Security on or after the Stated Maturity expressed in such Debt Security (or, in the case of redemption, on or after the Redemption Date). SECTION 515. Waiver of Stay or Extension Laws. -------------------------------- The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law wherever enacted, or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the exercise of any power herein granted to the Trustee, but will suffer and permit the exercise of every such power as though no such law had been enacted. ARTICLE SIX THE TRUSTEE SECTION 601. Certain Duties and Responsibilities. ----------------------------------- (a) Except during the continuance of an Event of Default, (1) the Trustee undertakes to perform such duties and only such duties as are specifically set forth in 42 this Indenture, and, to the extent lawful, no implied covenants or obligations shall be read into this Indenture against the Trustee; and (2) in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture. (b) In case an Event of Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture, and use the same degree of care and skill in their exercise, as a prudent man would exercise or use under the circumstances in the conduct of his own affairs. (c) No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that ------ (1) this Subsection shall not be construed to limit the effect of Subsection (a) of this Section; (2) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it shall be proved that the Trustee was negligent in ascertaining the pertinent facts; (3) the Trustee shall not be liable with respect to any action taken or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in principal amount of the Outstanding Debt Securities of any series relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Indenture with respect to the Debt Securities of that series; and (4) no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers if it shall have reasonable grounds for believing that repayment of such funds or 43 adequate indemnity against such risk or liability is not reasonably assured to it. (d) Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section. SECTION 602. Notice of Defaults. ------------------ Within 90 days after the occurrence of any default hereunder known to a Responsible Officer of the Trustee with respect to the Debt Securities of any series, the Trustee shall transmit in the manner specified under Section 106 to all Holders of Debt Securities of that series (including Holders identified in TIA (S) 315(b)), notice of such default hereunder known to the Trustee, unless such default shall have been cured or waived; provided, however, that, except in -------- ------- the case of a default in the payment of the principal of (or premium, if any) or interest, if any, on any Debt Security of that series, or in the payment of any sinking fund payment with respect to Debt Securities of that series, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors or Responsible Officers of the Trustee in good faith determine that the withholding of such notice is in the interests of the Holders of Debt Securities of that series; and provided further, that in the case of any default of the character -------- ------- specified in Section 501(4) with respect to Debt Securities of that series, no such notice to Holders shall be given until at least 60 days after the occurrence thereof. For the purpose of this Section, the term "DEFAULT" means any event which is, or after notice or lapse of time or both would become, an Event of Default with respect to Debt Securities of that series. SECTION 603. Certain Rights of Trustee. ------------------------- Subject to the provisions of Section 601, (a) the Trustee may rely and shall be protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, Debt Security or other paper or document believed by it in good faith to be genuine and to have been signed or presented by the proper party or parties; (b) any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the 44 Board of Directors may be sufficiently evidenced by a Board Resolution; (c) whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers' Certificate; (d) the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; (e) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; (f) the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, Debt Security or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine the books, records and premises of the Company, personally or by agent or attorney; (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any agent or attorney appointed with due care by it hereunder; and (h) the Trustee shall not be liable for any action taken by it in good faith and believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture. 45 SECTION 604. Not Responsible for Recitals or Issuance of Debt Securities. ----------------------------------------------------------- The recitals contained herein and in the Debt Securities, except the Trustee's certificates of authentication, shall be taken as the statements of the Company, and the Trustee assumes no responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Debt Securities. The Trustee shall not be accountable for the use or application by the Company of the Debt Securities or the proceeds thereof. SECTION 605. May Hold Debt Securities. ------------------------ The Trustee, any Paying Agent, the Debt Securities Registrar or any other agent of the Company or the Trustee, in its individual or any other capacity, may become the owner or pledgee of Debt Securities and may otherwise deal with the Company with the same rights it would have if it were not Trustee, Paying Agent, Debt Securities Registrar or such other agent. SECTION 606. Money Held in Trust. ------------------- Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law. Such amounts shall be invested by the Trustee solely at the written direction of the Company. The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed with the Company. SECTION 607. Compensation, Reimbursement and Indemnity. ----------------------------------------- The Company agrees (1) to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (2) to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except to the extent such expense, disbursement or advance may be attributable to its negligence or bad faith; and 46 (3) to indemnify the Trustee, its officers, directors, agents and employees for, and to hold them harmless against, any loss, liability or expense arising out of or in connection with the acceptance or administration of this trust, including liability which the Trustee, its officers, directors, agents and employees may incur as a result of failure to withhold, pay or report taxes and including the costs and expenses of defending themselves against any claim or liability in connection with the exercise or performance of any of their powers or duties hereunder, except in each case to the extent such loss, liability or expense may be attributable to their negligence or bad faith. As security for the performance of the obligations of the Company under this Section the Trustee shall have a lien prior to the Debt Securities upon all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of (and premium, if any) or interest, if any, on particular Debt Securities. Subject to any other rights available to the Trustee under any applicable Bankruptcy Law, when the Trustee incurs expenses or renders services after an Event of Default specified in clause (5) or (6) of Section 501 has occurred, the parties hereto and the Holders, by acceptance of the Debt Securities, hereby agree that such expenses and compensation for services are intended to constitute expenses of administration under any applicable Bankruptcy Law. The Trustee's rights under this Section 607 shall survive the resignation or removal of the Trustee, the redemption of the Debt Securities and the termination of this Indenture. "TRUSTEE," for purposes of this Section 607, includes any predecessor Trustee, provided that the negligence or bad faith of any Trustee shall not affect the rights under this Section 607 of any other Trustee. SECTION 608. Corporate Trustee Required; Eligibility. --------------------------------------- There shall at all times be a Trustee hereunder which shall be a corporation organized and doing business under the laws of the United States of America or of any State, authorized under such laws to exercise corporate trust powers, having a combined capital and surplus of at least $50,000,000, subject to supervision or examination by Federal or State authority. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examin- 47 ing authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article. The Trustee shall at all times be subject to the conflict of interest provisions of TIA (S) 310(b), including the optional provision of TIA (S) 310(b)(9), permitted by the second sentence thereof. Furthermore, the conflict of interest provisions of TIA (S) 310(b)(1) regarding conflicts arising between different indentures shall also apply to any conflicts arising between series of Debt Securities issued under this Indenture. SECTION 609. Resignation and Removal; Appointment of Successor. ------------------------------------------------- (a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee under Section 610. (b) The Trustee may resign at any time with respect to the Debt Securities of one or more series by giving written notice thereof to the Company. If an instrument of acceptance by a successor Trustee shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to that series. (c) The Trustee may be removed at any time with respect to the Debt Securities of any series by Act of the Holders of a majority in principal amount of the Outstanding Debt Securities of that series, delivered to the Trustee and to the Company. (d) If at any time: (1) the Trustee shall cease to be eligible under Section 608 and shall fail to resign after written request therefor by the Company or by any such Holder, or (2) the Trustee shall become incapable of acting or shall be adjudged as bankrupt or insolvent, or a receiver of the Trustee or of its property shall be appointed, or any public officer shall take charge or 48 control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, then, in any such case, (i) the Company by a Board Resolution may remove the Trustee with respect to all Debt Securities, or (ii) subject to Section 514, any Holder who has been a bona fide Holder of a Debt Security of any series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to the Debt Securities of that series and the appointment of a successor Trustee. (e) If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, with respect to the Debt Securities of one or more series, the Company, by a Board Resolution, shall promptly appoint a successor Trustee with respect to the Debt Securities of that or those series (it being understood that any such successor Trustee may be appointed with respect to the Debt Securities of one or more or all of that or those series and that at any time there shall be only one Trustee with respect to the Debt Securities of any series). If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Debt Securities of any series shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Debt Securities of that series delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment, become the successor Trustee with respect to the Debt Securities of that series and supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Debt Securities of any series shall have been so appointed by the Company or the Holders and accepted appointment in the manner hereinafter provided, any Holder who has been a bona fide Holder of a Debt Security of that series for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Debt Securities of that series. (f) The Company shall give notice of each resignation and each removal of the Trustee with respect to the Debt Securities of any series and each appointment of a successor Trustee with respect to the Debt Securities of any series in the manner provided by Section 106. Each notice shall include the name of the Successor Trustee with respect to the Debt Securities of that series and the address of its Corporate Trust Office. 49 SECTION 610. Acceptance of Appointment by Successor. -------------------------------------- (a) In case of appointment hereunder of a successor Trustee with respect to all Debt Securities, every such successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder, subject nevertheless to its lien, if any, provided for in Section 607. (b) In case of the appointment hereunder of a successor Trustee with respect to the Debt Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor Trustee with respect to the Debt Securities of one or more series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (1) shall contain such provisions as shall be necessary or desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties of the retiring Trustee with respect of the Debt Securities of that or those series to which the appointment of such successor Trustee relates, (2) if the retiring Trustee is not retiring with respect to all Debt Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the rights, powers, trusts and duties of the retiring Trustee with respect to the Debt Securities of that or those series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and (3) shall add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being understood that nothing herein or in such supplemental indenture shall constitute such Trustees as co-trustees of the same trust, that each such Trustee shall be trustee of a trust or trusts hereunder separate and apart from any trust or trusts hereunder administered by any other such Trustee and that no Trustee shall be responsible for any notice given to, or received by, or any act or failure to act on the part of any other Trustee hereunder, and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent 50 provided therein, such retiring Trustee shall with respect to the Debt Securities of that or those series as to which the appointment of such successor Trustee relates have no further responsibility for the exercise of rights and powers or for the performance of the duties and obligations vested in the Trustee under this Indenture other than as hereinafter expressly set forth, and each such successor Trustee without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Debt Securities of that or those series as to which the appointment of such successor Trustee relates; but, on request of the Company or any successor Trustee, such retiring Trustee shall duly assign, transfer and deliver to such successor Trustee, to the extent contemplated by such supplemental indenture, the property and money held by such retiring Trustee hereunder with respect to the Debt Securities of that or those series as to which the appointment of such successor Trustee relates. (c) Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section, as the case may be. No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified under this Article. SECTION 611. Merger, Conversion, Consolidation or Succession to Business. ----------------------------------------------------------- Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all of the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such corporation shall be otherwise qualified and eligible under this - -------- Article, without the execution or filing of any paper or any further act on the part of any of the parties hereto. In case any Debt Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Debt Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Debt Securities. 51 SECTION 612. Appointment of Authenticating Agent. ----------------------------------- So long as any of the Debt Securities remain Outstanding, there may be one or more Authenticating Agents appointed by the Trustee which shall be authorized to act on behalf and subject to the direction of the Trustee with respect to one or more series of Debt Securities to authenticate Debt Securities issued upon exchange, registration of transfer or partial redemption thereof or pursuant to Section 306, and Debt Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. Wherever reference is made in this Indenture to the authentication of Debt Securities by the Trustee or the Trustee's certificate of authentication, such reference shall be deemed to include authentication on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Each Authenticating Agent shall be subject to acceptance by the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America or of any State thereof or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of at least $50,000,000 and subject to supervision or examination by Federal or State authorities. If such corporation publishes reports of condition at least annually, pursuant to law or to the requirements of the aforesaid supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such corporation shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect hereinafter specified in this Section. Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which an Authenticating Agent shall be a party, or any corporation succeeding to the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided such corporation shall be otherwise qualified and -------- eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or such Authenticating Agent, but such Authenticating Agent shall give the Trustee written notice of any such merger, conversion, consolidation or succession. 52 Any Authenticating Agent may at any time resign by giving written notice of resignation to the Trustee and to the Company. The Trustee may at any time terminate the agency of any Authenticating Agent by giving written notice of termination to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time any Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent acceptable to the Company, in which case it shall give notice of such appointment to Holders as provided in Section 106. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent herein. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section. The Trustee agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services, and the Trustee shall be entitled to be reimbursed for such payments. SECTION 613. Preferential Collection of Claims Against Company. ------------------------------------------------- The Trustee shall at all times be subject to the provisions of TIA (S) 311(a), excluding any creditor relationship listed in TIA (S) 311(b). Any Trustee who has resigned or been removed is subject to TIA (S) 311(a) to the extent indicated. SECTION 614. Reports by Trustee to Holders. ----------------------------- Within 60 days after May 15 of each year, commencing May 15, 1997, the Trustee shall transmit to Holders (including Holders identified in TIA (S) 313(c)) in the manner provided by Section 106 a brief report that complies with the provisions of TIA (S) 313(a) and dated as of such reporting date. The Trustee shall also comply with TIA (S) 313(b)(2). A copy of each report at the time of its transmission to Holders shall be filed with the SEC and each stock exchange on which the Debt Securities are listed. The Company shall notify the Trustee when the Debt Securities are listed on any stock exchange. SECTION 615. Other Capacities. ---------------- Except as otherwise specifically provided herein, (i) all references in this Indenture to the Trustee shall be 53 deemed to refer to the Trustee in its capacity as Trustee and in its capacities as Debt Securities Registrar and Paying Agent and (ii) every provision of this Indenture relating to the conduct or affecting the liability or offering protection, immunity or indemnity to the Trustee shall be deemed to apply with the same force and effect to the Trustee acting in its capacities as Paying Agent and Debt Securities Registrar. SECTION 616. Notice of Default. ----------------- The Trustee shall not be deemed to have or be charged with knowledge of any default or Event of Default with respect to the Debt Securities of any series for which it is acting as Trustee unless (a) a Responsible Officer of the Trustee shall have actual knowledge of such default or Event of Default or (b) written notice of such default or Event of Default shall have been given to the Trustee by the Company or any other obligor on such Debt Securities or by any Holder of such Debt Securities. ARTICLE SEVEN HOLDERS' LISTS SECTION 701. Company to Furnish Trustee Names and Addresses of Holders. ------------------------------------ -------------------- The Company will furnish or cause to be furnished to the Trustee (a) not more than 15 days after each Regular Record Date, if any, for each series of Debt Securities (or if no Regular Record Date exists or the interval between Regular Record Dates is greater than six months then at least every six months), a list, in such form as the Trustee may reasonably require, containing all information in the possession or control of the Company, or of any of its Paying Agents, as to the names and addresses of the Holders of Registered Debt Securities of that series as of such Regular Record Date, and (b) at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of similar form and content as of a date not more than 15 days prior to the time such list is furnished provided, however, that so long as the Trustee is the Debt -------- ------- Securities Registrar, no such list shall be required to be furnished. 54 The Trustee shall preserve, in as current a form as is reasonably practicable, all such information furnished to it or received by it in its capacity as Paying Agent. For purposes of this Section 701, the term "COMPANY" also includes any other obligor. ARTICLE EIGHT CONSOLIDATION, MERGER, CONVEYANCE, TRANSFER OR LEASE; CREATION OF LIENS SECTION 801. Company May Consolidate, Etc., Only on Certain Terms. ---------------------------------------------------- The Company shall not consolidate with or merge into any other Corporation, or convey, lease or transfer its properties and assets substantially as an entirety to any Person, unless: (1) the Corporation formed by such consolidation or into which the Company is merged or the Person which acquires by conveyance, lease or transfer the properties and assets of the Company substantially as an entirety shall be a Corporation organized and existing under the laws of the United States of America or any State or the District of Columbia, and shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of (and premium, if any) and interest, if any, on all the Debt Securities and the performance of every covenant of this Indenture on the part of the Company to be performed or observed; (2) immediately after giving effect to such transaction, no Event of Default, and no event which, after notice or lapse of time, or both, would become an Event of Default, shall have happened and be continuing; and (3) the Company has delivered to the Trustee an Officers' Certificate and an Opinion of Counsel, each stating that such consolidation, merger, conveyance, lease or transfer and such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with. 55 SECTION 802. Successor Corporation Substituted. --------------------------------- Upon any consolidation or merger, or any conveyance, lease or transfer of the properties and assets of the Company substantially as an entirety, of the type described in and in accordance with Section 801, the successor corporation formed by such consolidation or into which the Company is merged or to which such conveyance, lease or transfer is made shall succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture with the same effect as if such successor corporation had been named as the Company herein, and thereafter the predecessor corporation, except in the event of a conveyance by way of lease, shall be relieved of all obligations and covenants under this Indenture and the Debt Securities. Such successor corporation thereupon may cause to be signed, and may issue either in its own name or in the name of the Company, any or all of the Debt Securities issuable hereunder which theretofore shall not have been signed by the Company and delivered to the Trustee; and, upon the order of such successor corporation, instead of the Company, and subject to all the terms, conditions and limitations in this Indenture prescribed, the Trustee shall authenticate and shall deliver any Debt Security which previously shall have been signed and delivered by the officers of the Company to the Trustee for authentication, and any Debt Securities which such successor corporation thereafter shall cause to be signed and delivered to the Trustee for that purpose. All the Debt Securities so issued shall in all respects have the same legal rank and benefit under this Indenture as the Debt Securities theretofore or thereafter issued in accordance with the terms of this Indenture as though all of such Debt Securities had been issued at the date of execution hereof. In case of any such consolidation, merger, sale or conveyance such changes in phraseology and form (but not in substance) may be made in the Debt Securities thereafter to be issued as may be appropriate. ARTICLE NINE SUPPLEMENTAL INDENTURES SECTION 901. Supplemental Indentures Without Consent --------------------------------------- of Holders. ---------- Without the consent of any Holders, the Company, when authorized by a Board Resolution, and the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes: 56 (1) to evidence the succession of another corporation to the Company, and the assumption by any such successor of the covenants of the Company herein and in the Debt Securities contained; or (2) to add to the covenants of the Company, for the benefit of the Holders of all or any series of Debt Securities (and if such covenants are to be for the benefit of less than all series of Debt Securities, stating that such covenants are expressly being included solely for the benefit of that series) or to surrender any right or power herein conferred upon the Company; or (3) to establish the form or terms of Debt Securities of any series as permitted by Sections 201 or 301; or (4) to cure any ambiguity, to correct or supplement any provision herein or in any supplemental indenture which may be defective or inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture, provided such action pursuant to this clause (4) shall not -------- adversely affect the interests of the Holders of Debt Securities of any series in any material respect; or (5) to add to, delete from or revise the conditions, limitations and restrictions on the authorized amount, terms or purposes of issue, authentication and delivery of Debt Securities of one or more series, as herein set forth; or (6) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Debt Securities of one or more series and to add to or change any of the provisions of this Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirement of Section 610(b). SECTION 902. Supplemental Indentures with Consent of Holders. ----------------------------------------------- With the consent of the Holders of not less than a majority in principal amount of the Outstanding Debt Securities of each series affected by such supplemental indenture, by Act of said Holders delivered to the Company and the Trustee, the Company, when authorized by a Board Resolution, and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions 57 to or changing in any manner or eliminating any of the provisions of this Indenture or of modifying in any manner the rights of the Holders of Debt Securities of that series under this Indenture; provided, however, that no such -------- ------- supplemental indenture shall, without the consent of the Holder of each Outstanding Debt Security affected thereby, (1) change the Stated Maturity of the principal of, or any installment of interest on, any Debt Security, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or reduce the amount of the principal of an Original Issue Discount Debt Security that would be due and payable upon a declaration of acceleration of the Maturity thereof pursuant to Section 502, or change the coin or currency in which, the principal of (or premium, if any, on) any Debt Security or the interest, if any, thereon is payable, or impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date), or modify the provisions of this Indenture with respect to the conversion or exchange of the Debt Securities into Common Stock or into Debt Securities of another series in a manner adverse to the Holders, (2) reduce the percentage in principal amount of the Outstanding Debt Securities of any series, the consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Indenture or certain defaults hereunder and their consequences) provided for in this Indenture, or (3) modify any of the provisions of this Section or Section 513 or Section 1005, except to increase any such percentage or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Debt Security affected thereby. A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture which has expressly been included solely for the benefit of one or more particular series of Debt Securities, or which modifies the rights of the Holders of Debt Securities of that series with respect to such covenant or other provision, shall be deemed not to affect the rights under this Indenture of the Holders of Debt Securities of any other series. 58 It shall not be necessary for any Act of Holders under this Section to approve the particular form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof. SECTION 903. Execution of Supplemental Indentures. ------------------------------------ In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be entitled to receive, and (subject to Section 601) shall be fully protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Indenture. The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which adversely affects the Trustee's own rights, duties or immunities under this Indenture or otherwise. SECTION 904. Effect of Supplemental Indentures. --------------------------------- Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Debt Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby. Any supplemental indenture executed under this Article shall comply in all respects with the requirements of the TIA. SECTION 905. Reference in Debt Securities to Supplemental Indentures. ------------------------------------------------------- Debt Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Debt Securities of any series so modified as to conform, in the opinion of the Trustee and the Board of Directors, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Debt Securities of that series. 59 ARTICLE TEN COVENANTS SECTION 1001. Payment of Principal, Premium and Interest. ------------------------------------------ The Company will duly and punctually pay the principal of (and premium, if any) and interest (including any additional interest provided for in an Officers' Certificate or supplemental indenture referred to in Section 301 with respect to any Debt Securities of a series), if any, on the Debt Securities in accordance with the terms of the Debt Securities and this Indenture. SECTION 1002. Maintenance of Office or Agency. ------------------------------- The Company will maintain in the City of New York, an office or agency or offices or agencies where, unless otherwise set forth in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to any Debt Securities of a series, Debt Securities may be presented or surrendered for payment, Debt Securities may be surrendered for registration of transfer or exchange, and notices and demands to or upon the Company in respect of the Debt Securities and this Indenture may be served. The Company initially appoints the Trustee at its Corporate Trust Office, as its agent for purposes of presentation or surrender of Debt Securities for payment, registration of transfer, exchange or conversion and for service of notices or demands to or upon it in respect of the Debt Securities and this Indenture. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of any such office or agency. If at any time the Company shall fail to maintain such office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office of the Trustee, and the Company hereby appoints the Corporate Trust Office of the Trustee its agent to receive all such presentations, surrenders, notices and demands. In addition to such office or agency, the Company may from time to time designate one or more other offices or agencies where the Debt Securities of one or more series may be presented or surrendered for any or all of the purposes specified above in this Section and may constitute and appoint one or more Paying Agents for the payment of the Debt Securities of that or those series in one or more other cities, and may from time to time rescind such designations and appointments, as the Company may deem desirable or expedient; provided, however, that no such designation, appointment or rescission shall in - -------- ------- any manner relieve the 60 Company of its obligation to maintain such office and agency in the City of New York for the purposes above mentioned. SECTION 1003. Money for Debt Security Payments to be Held in Trust. ---------------------------------------------------- If the Company shall at any time act as its own Paying Agent with respect to any series of Debt Securities, it will, on or before each due date of the principal of (and premium, if any) or interest, if any, on any of the Debt Securities of that series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal (and premium, if any) or interest, if any, so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided, and will promptly notify the Trustee of its action or failure so to act. Whenever the Company shall have one or more Paying Agents for any series of Debt Securities, it will, prior to each due date of the principal of (and premium, if any) or interest, if any, on any Debt Securities of that series, deposit with a Paying Agent a sum sufficient to pay the principal (and premium, if any) or interest, if any, so becoming due, such sum to be held in trust for the benefit of the Persons entitled to such principal, premium or interest, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act. The Company will cause each Paying Agent for any series of Debt Securities other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will: (1) hold all sums held by it for the payment of the principal of (and premium, if any) or interest, if any, on Debt Securities of that series in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided; (2) give the Trustee notice of any default by the Company (or any other obligor upon the Debt Securities of that series) in the making of any payment of principal (and premium, if any) or interest, if any, on the Debt Securities of that series; and (3) at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so held in trust by such Paying Agent. 61 The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee, such Paying Agent shall be released from all further liability with respect to such money. Subject to applicable escheat laws, any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of (and premium, if any) or interest, if any, on any Debt Security of any series and remaining unclaimed for three years after such principal (and premium, if any) or interest, if any, has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Debt Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or -------- ------- such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company. SECTION 1004. Statement as to Compliance. -------------------------- The Company will deliver to the Trustee, within 120 days after the end of each fiscal year, a written statement, which need not comply with Section 102, signed by the principal financial, principal executive or principal accounting officer stating that: (1) a review of the activities of the Company during such year and of performance under this Indenture has been made under his supervision, and (2) to the best of his knowledge, based on such review, (a) the Company has fulfilled all its obligations under this Indenture throughout such year, or, if there has been a default in the fulfillment of any such obligation, specifying each such default known to him 62 and the nature and status thereof, and (b) no event has occurred and is continuing which is, or after notice or lapse of time or both would become, an Event of Default, or, if such an event has occurred and is continuing, specifying each such event known to him and the nature and status thereof. SECTION 1005. Waiver of Certain Covenants. --------------------------- The Company may omit in any particular instance to comply with any covenant or condition set forth in Section 1004 with respect to the Debt Securities of any series, if before or after the time for such compliance the Holders of at least a majority in principal amount of the Debt Securities of that series at the time Outstanding shall, by Act of such Holders, either waive such compliance in such instance or generally waive compliance with such covenant or condition, but no such waiver shall extend to or affect such covenant or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of the Trustee in respect of any such covenant or condition shall remain in full force and effect. SECTION 1006. SEC Reports. ----------- The Company shall file with the Trustee within 15 days after it files them with the SEC copies of the annual reports and of the information, documents, and other reports (or copies of such portions of any of the foregoing as the SEC may by rules and regulations prescribe) which the Company is required to file with the SEC pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. The Company shall also comply with the other provisions of TIA (S) 314(a) concerning the filing and transmission of reports to the SEC, the Trustee and Holders. SECTION 1007. Limitations on Dividends, Distributions and Acquisitions of ----------------------------------------------------------- Capital Stock. ------------- The Company will not declare or pay any dividends or make any distribution to holders of its capital stock (other than dividends or distributions payable in capital stock of the Company or other than as the Company determines is necessary to maintain its status as a REIT), or purchase, redeem or otherwise acquire or retire for value any of its capital stock or any warrants, rights or options (including any securities convertible into or exercisable for such capital stock but not including the Debt Securities) to purchase or acquire any shares of its capital stock or permit any Subsidiary to purchase, redeem or otherwise acquire or retire for value any of the Company's capital stock or any warrants, rights or options (including any 63 securities convertible into or exercisable for such capital stock but not including the Debt Securities) to purchase or acquire any shares of the Company's capital stock if at the time of such action an Event of Default has occurred and is continuing or would exist immediately after giving effect to such action. Notwithstanding the foregoing, the provisions of this Section 1007 will not prevent (i) the payment of any dividend within 60 days after the date of declaration when the payment would have complied with the foregoing provisions on the date of declaration; (ii) the retirement of any share of the Company's capital stock by exchange for, or out of the proceeds of the substantially concurrent sale (other than to a Subsidiary) of, other shares of its capital stock. ARTICLE ELEVEN REDEMPTION OF DEBT SECURITIES SECTION 1101. Right of Redemption. ------------------- Redemption of Debt Securities of any series at the option of the Company as permitted or required by the terms of such Debt Securities shall be made in accordance with the terms of such Debt Securities and this Article; provided, however, that if as a result of such redemption any Holder would become the Beneficial Owner of more than 9.9% of the outstanding stock of the Company because such Holder's Debt Securities were not redeemed, or were redeemed only in part, then the Company will redeem the requisite number of Debt Securities of such Holder such that such Holder will not Beneficially Own more than 9.9% of the outstanding stock of the Company. The Debt Securities also shall be subject to redemption, in whole or from time to time in part, at any time in order to protect the Company's status as a REIT, at the option of the Company at a redemption price equal to 100% of the principal amount, plus accrued interest to the date of redemption. SECTION 1102. Election to Redeem; Notice to Trustee. ------------------------------------- The election of the Company to redeem any Debt Securities pursuant to Section 1101 shall be evidenced by a Board Resolution. The Company shall, at least 60 days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the Trustee of such Redemption Date and, in the case of any redemption at the election of the Company of less than all the Debt Securities of any series, of the principal amount of Debt Securities of that series to be redeemed. 64 SECTION 1103. Selection by Trustee of Debt Securities to be Redeemed. ------------------------------------------------------ If less than all the Debt Securities of any series with the same issue date and Stated Maturity are to be redeemed, the particular Debt Securities to be redeemed shall be selected not more than 60 days prior to the Redemption Date by the Trustee, from the Outstanding Debt Securities of that series not previously called for redemption, by such method as specified in the Officers' Certificate or supplemental indenture referred to in Section 301 or, if not so specified, by such method as the Trustee shall deem fair and appropriate and which may provide for the selection for redemption of portions (equal to $100,000 or an integral multiple of $1,000 above $100,000) of the principal of Debt Securities of that series of a denomination larger than $100,000. The portions of the principal of Debt Securities of that series so selected for partial redemption shall be equal to the smallest authorized denomination of the Debt Securities of that series or an integral multiple of $1,000 above $100,000. The portion of the principal of any Debt Security not redeemed shall not be less than the smallest authorized denomination of the Debt Securities of that series. The Trustee shall promptly notify the Company and each Debt Securities Registrar in writing of the Debt Securities selected for redemption and, in the case of any Debt Securities selected for partial redemption, the principal amount thereof to be redeemed. For all purposes of this Indenture, unless the context otherwise requires, all provisions relating to the redemption of Debt Securities shall relate, in the case of any Debt Security redeemed or to be redeemed only in part, to the portion of the principal of such Debt Security which has been or is to be redeemed. SECTION 1104. Notice of Redemption. -------------------- Notice of redemption shall be given in the manner provided in Section 106 not less than 30 nor more than 60 days prior to the Redemption Date unless a shorter period is specified in the Debt Security of the series to be redeemed, to each Holder of Debt Securities to be redeemed, but failure to give such notice in the manner herein provided to the Holder of any Debt Securities designated for redemption as a whole or in part, or any defect in the notice to any such Holder, shall not affect the validity of the proceedings for the redemption of any other such Debt Securities or portion thereof. 65 Any notice that is mailed in the manner herein provided shall be conclusively presumed to have been given, whether or not the Holder receives the notice. All notices of redemption shall state: (1) the Redemption Date, (2) the Redemption Price and the amount of accrued interest, if any, to be paid, (3) if less than all the Outstanding Debt Securities of any series are to be redeemed, the identification (and, in the case of partial redemption, the principal amounts) of the particular Debt Securities to be redeemed, (4) in case any Debt Security is to be redeemed in part only, the notice which relates to such Debt Security shall state that on and after the Redemption Date, upon surrender of such Debt Security, the Holder will receive, without charge, a new Debt Security or Debt Securities of authorized denominations for the principal amount thereof remaining unredeemed, (5) that on the Redemption Date the Redemption Price and accrued interest, if any, will become due and payable upon each such Debt Security to be redeemed and, if applicable, that the interest thereon will cease to accrue on and after said date, (6) the place or places where such Debt Securities are to be surrendered for payment of the Redemption Price and accrued interest, if any, and (7) the conversion rights, if any, pertaining to such Debt Securities. Notice of redemption of Debt Securities to be redeemed at the election of the Company shall be given by the Company or, at the Company's request, by the Trustee in the name of and at the expense of the Company. SECTION 1105. Deposit of Redemption Price. --------------------------- Prior to each Redemption Date, the Company shall deposit with the Trustee or with a Paying Agent (or, if the Company is acting as its own Paying Agent, segregate and hold in trust as provided in Section 1003) an amount of money sufficient to pay the Redemption Price of, and (unless the Redemption Date shall be an Interest Payment Date) accrued interest on, all the Debt Securities or portions thereof which are to be redeemed on that date. 66 SECTION 1106. Debt Securities Payable on Redemption Date. ------------------------------------------ Notice of redemption having been given as aforesaid, the Debt Securities so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and after such date (unless the Company shall default in the payment of the Redemption Price and accrued interest) such Debt Securities shall cease to bear interest. Upon surrender of any such Debt Security for redemption in accordance with said notice, such Debt Security shall be paid by the Company at the Redemption Price, together with accrued interest to the Redemption Date; provided, however, that -------- ------- notwithstanding any other provision of this Indenture and unless otherwise specified in the Officers' Certificate or supplemental indenture referred to in Section 301 with respect to such Debt Security, installments of interest whose Stated Maturity is on or prior to the Redemption Date shall be payable (but without interest thereon, unless the Company shall default in the payment thereof in which case the provisions of Section 307 shall apply) to the Holders of such Debt Securities or one or more Predecessor Debt Securities, registered as such at the close of business on the relevant Record Dates according to their terms and the provisions of Section 307. If any Debt Security called for redemption shall not be so paid upon surrender thereof for redemption, the principal (and premium, if any) shall, until paid, bear interest, to the extent lawful, from the Redemption Date at the rate borne by the Debt Security. SECTION 1107. Debt Securities Redeemed in Part. -------------------------------- Any Debt Security which is to be redeemed only in part shall be surrendered at the office or agency of the Company designated for that purpose pursuant to Section 1002 (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or his attorney duly authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Debt Security without service charge a new Debt Security or Debt Securities of any authorized denomination of the same series as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Debt Security so surrendered. If a Global Debt Security is so surrendered, such new Debt Security so issued shall be a new Global Debt Security. 67 ARTICLE TWELVE SINKING FUND SECTION 1201. Mandatory and Optional Sinking Fund Payments. -------------------------------------------- The provisions of this Article shall be applicable to any sinking fund for the retirement of Debt Securities of any series, except as otherwise permitted or required by any form of Debt Security of that series issued pursuant to this Indenture. The minimum amount of any sinking fund payment provided for by the terms of Debt Securities of any series is herein referred to as a "MANDATORY SINKING FUND PAYMENT", and any payment in excess of that minimum amount provided for by the terms of Debt Securities of that series is herein referred to as an "OPTIONAL SINKING FUND PAYMENT". If provided for by the terms of Debt Securities of any series, the cash amount of any sinking fund payment may be subject to reduction as provided in Section 1202. Each sinking fund payment shall be applied to the redemption of Debt Securities of any series as provided for by the terms of Debt Securities of that series. SECTION 1202. Satisfaction of Sinking Fund Payments with Debt Securities. ---------------------------------------------------------- The Company may, in satisfaction of all or any part of any sinking fund payment with respect to the Debt Securities of any series to be made pursuant to the terms of such Debt Securities as provided for by the terms of that series, (1) deliver Outstanding Debt Securities of that series (other than any of such Debt Securities previously called for redemption or any of such Debt Securities in respect of which cash shall have been released to the Company), (2) apply as a credit Debt Securities of that series which have been redeemed either at the election of the Company pursuant to the terms of that series of Debt Securities or through the application of permitted optional sinking fund payments pursuant to the terms of such Debt Securities, provided that such -------- series of Debt Securities have not been previously so credited and (3) apply as a credit Debt Securities of that series which have been converted or exchanged into Common Stock or Debt Securities of another series pursuant to the terms of that series of Debt Securities, provided that such series of Debt Securities -------- have not been previously so credited. Such Debt Securities shall be received and credited for such purpose by the Trustee at the Redemption Price specified in such Debt Securities for redemption through operation of the sinking fund and the amount of such sinking fund payment 68 shall be reduced accordingly. If as a result of the delivery or credit of Debt Securities of any series in lieu of cash payments pursuant to this Section, the principal amount of Debt Securities of that series to be redeemed in order to exhaust the aforesaid cash payment shall be less than $100,000, the Trustee need not call Debt Securities of that series for redemption, except upon Company Request, and such cash payment shall be held by the Trustee or a Paying Agent and applied to the next succeeding sinking fund payment, provided, however, that -------- ------- the Trustee or such Paying Agent shall at the request of the Company from time to time pay over and deliver to the Company any cash payment so being held by the Trustee or such Paying Agent upon delivery by the Company to the Trustee of Debt Securities of that series purchased by the Company having an unpaid principal amount equal to the cash payment requested to be released to the Company. SECTION 1203. Redemption of Debt Securities for Sinking Funds. ----------------------------------------------- Not less than 60 days prior to each sinking fund payment date for any series of Debt Securities, the Company will deliver to the Trustee an Officers' Certificate specifying the amount of the next ensuing mandatory sinking fund payment for that series pursuant to the terms of that series, the portion thereof, if any, which is to be satisfied by payment of cash and the portion thereof, if any, which is to be satisfied by delivering and crediting of Debt Securities of that series pursuant to Section 1202, and the optional amount, if any, to be added in cash to the next ensuing mandatory sinking fund payment, and will also deliver to the Trustee any Debt Securities to be so credited and not theretofore delivered. If such Officers' Certificate shall specify an optional amount to be added in cash to the next ensuing mandatory sinking fund payment, the Company shall thereupon be obligated to pay the amount therein specified. Not less than 30 days before each such sinking fund payment date the Trustee shall select the Debt Securities to be redeemed upon such sinking fund payment date in the manner specified in Section 1103 and cause notice of the redemption thereof to be given in the name of and at the expense of the Company in the manner provided in Section 1104. Such notice having been duly given, the redemption of such Debt Securities shall be made upon the terms and in the manner stated in Section 1106 and 1107. 69 ARTICLE THIRTEEN CONVERSION OF DEBT SECURITIES SECTION 1301. Conversion Privilege. -------------------- Conversion of Debt Securities of any series into Common Stock of the Company as permitted by the terms of such Debt Securities shall be made in accordance with the terms of such Debt Securities and this Article. "COMMON STOCK" used herein in Article Thirteen means the Common Stock of the Company on the date the Debt Securities of such series are issued. Notwithstanding the foregoing, and in order to protect the Company's status as a REIT, a Holder may not convert any Debt Security, and any such Debt Security shall not be convertible by any Holder, if as a result of such conversion any Person would then be deemed to Beneficially Own more than 9.9% of the outstanding stock of the Company. Except as otherwise set forth herein, the Trustee shall have no duties or responsibilities in respect of the conversion privilege or of any matter relating thereto, including without limitation the determination of the conversion price or any adjustment thereto. SECTION 1302. Exercise of Conversion Privilege. -------------------------------- In order to exercise the conversion privilege, the Holder of any Debt Security of any series to be converted shall surrender such Debt Security, duly endorsed or assigned to the Company or in blank, at any office or agency of the Company maintained for that purpose, accompanied by written notice to the Company at such office or agency that the Holder elects to convert such Debt Security or, if less than the entire principal amount thereof is to be converted, the portion thereof to be converted. Debt Securities surrendered for conversion during the period from the close of business on any Regular Record Date for the payment of interest on the Debt Securities of that series to the opening of business on the Interest Payment Date for such interest shall (except in the case of Debt Securities of that series or portions thereof which have been called for redemption on a Redemption Date within such period) be accompanied by payment of an amount equal to the interest payable on such Interest Payment Date on the principal amount of Debt Securities being surrendered for conversion. Except as provided in the preceding sentence, no payment or adjustment shall be made upon any conversion on account of any interest accrued on the Debt Securities of that series surrendered for conversion or on account of any dividends on the Common Stock issued upon conversion. Debt Securities of any series shall be deemed to have been converted immediately prior to the close of 70 business on the day of surrender of such Debt Security for conversion in accordance with the foregoing provisions, and at such time the rights of the Holder of such Debt Security as Holder shall cease, and the Person or Persons entitled to receive the Common Stock issuable upon conversion shall be treated for all purposes as the record holder or holders of such Common Stock at such time. As promptly as practicable on or after the conversion date, the Company shall issue and shall deliver at said office or agency a certificate or certificates for the number of full shares of Common Stock issuable upon conversion, together with payment in lieu of any fraction of a share, as provided in Section 1303. In the case of any Debt Security which is converted in part only, upon such conversion the Company shall execute and the Trustee shall authenticate and deliver to the Holder thereof, at the expense of the Company, a new Debt Security or Debt Securities of authorized denominations in aggregate principal amount equal to the unconverted portion of the principal amount of such Debt Security. SECTION 1303. Fractions of Shares. ------------------- No fractional shares of Common Stock shall be issued upon conversion of Debt Securities. If more than one Debt Security shall be surrendered for conversion at one time by the same Holder, the number of full shares which shall be issuable upon conversion thereof shall be computed on the basis of the aggregate principal amount of the Debt Securities (or specified portions thereof) so surrendered. Instead of any fractional share of Common Stock which would otherwise be issuable upon conversion of any Debt Security or Debt Securities (or specified portions thereof), the Company shall pay a cash adjustment in respect of such fraction in an amount equal to the same fraction of the closing price per share of Common Stock on the day of conversion. The closing price shall be the reported last sale price of the Common Stock on the New York Stock Exchange -- Composite Transactions or, in case no such reported sale takes place on such day, the average of the reported closing bid and asked prices regular way on the New York Stock Exchange, or if the Common Stock is not listed or admitted to trading on such Exchange, on the principal national exchange on which the Common Stock is listed or admitted to trading or, if not listed or admitted to trading on any national securities exchange, the average of the closing bid and asked prices as furnished by any New York Stock Exchange member firm selected from time to time by the Company for that purpose. 71 SECTION 1304. Adjustments of Conversion Price. ------------------------------- (1) In the case the Company shall pay or make a dividend or other distribution on any class of capital stock of the Company in Common Stock after the issuance of a Debt Security entitled to exercise the conversion privilege, the conversion price of such Debt Security in effect at the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such dividend or other distribution shall be reduced by multiplying such conversion price by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination and the denominator shall be the sum of such number of shares and the total number of shares constituting such dividend or other distribution, such reduction to become effective immediately after the opening of business on the day following the date fixed for such determination. For the purposes of this paragraph (1), the number of shares of Common Stock at any time outstanding shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. (2) In case the Company shall issue, after the issuance of a Debt Security entitled to the conversion privilege, rights or warrants to all holders of its Common Stock entitling them to subscribe for or purchase shares of Common Stock at a price per share less than the current market price per share (determined as provided in paragraph (6) of this Section) of the Common Stock on the date fixed for the determination of stockholders entitled to receive such rights or warrants, the conversion price for such Debt Security in effect at the opening of business on the day following the date fixed for such determination shall be reduced by multiplying such conversion price by a fraction of which the numerator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock which the aggregate of the offering price of the total number of shares of Common Stock so offered for subscription or purchase would purchase at such current market price and the denominator shall be the number of shares of Common Stock outstanding at the close of business on the date fixed for such determination plus the number of shares of Common Stock so offered for subscription or purchase, such reduction to become effective immediately after the opening of business on the day following the date fixed for such determination; provided, however, that if all the shares of Common Stock offered for subscription or purchase are not subscribed for or purchased, upon the expiration of such rights or warrants the conversion price shall be immediately readjusted to what would have been the 72 conversion price had the above-referenced fraction been calculated with reference to the actual number of shares of Common Stock subscribed for or purchased rather than the number of shares of Common Stock offered for subscription or purchase. For the purposes of this paragraph (2), the number of shares of Common Stock at any time outstanding shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares of Common Stock. For purposes of this paragraph (2), the granting of the right to purchase shares of Common Stock pursuant to any shareholder rights plan, any dividend or interest reinvestment plan and/or any Common Stock purchase plan providing for the reinvestment of dividends or interest payable on securities of the Company and/or the investment of periodic optional payments at a price per share of not less than 95 percent of the current market price per share (determined as provided in such plans) of the Common Stock (so long as such right to purchase is in no case evidenced by the delivery of rights or warrants) shall be deemed not to constitute an issue of rights or warrants by the Company within the meaning of this paragraph (2). (3) In case outstanding shares of Common Stock shall be subdivided into a greater number of shares of Common Stock after the issuance of a Debt Security entitled to the conversion privilege, the conversion price for such Debt Security in effect at the opening of business on the day following the day upon which such subdivision becomes effective shall be proportionately reduced, and, conversely, in case outstanding shares of Common Stock shall each be combined into a smaller number of shares of Common Stock, the conversion price of such Debt Security in effect at the opening of business on the day following the day upon which such combination becomes effective shall be proportionately increased, such reduction or increase, as the case may be, to become effective immediately after the opening of business on the day following the day upon which such subdivision or combination becomes effective. (4) In case the Company shall, after the issuance of a Debt Security entitled to the conversion privilege, by dividend or otherwise, distribute to all holders of its Common Stock evidences of its indebtedness or assets (including securities, but excluding any dividend or distribution referred to in paragraph (1) of this Section, any rights or warrants referred to in paragraph (2) of this Section and any dividend or distribution not prohibited by Section 1007 hereof), the conversion price of such Debt Security shall be adjusted so that the same shall equal the price determined by multiplying the conversion price in effect immediately prior to the close of business on the date fixed for the determination of stockholders entitled to receive such distribution by a fraction of which the 73 numerator shall be the current market price per share (determined as provided in paragraph (6) of this Section) of the Common Stock on the date fixed for such determination less the then fair market value (as determined by the Board of Directors, whose determination shall be conclusive and described in a Board Resolution filed with the Trustee) of the portion of the assets or evidences of indebtedness so distributed applicable to one share of Common Stock and the denominator shall be such current market price per share of the Common Stock, such adjustment to become effective immediately prior to the opening of business on the day following the date fixed for the determination of stockholders entitled to receive such distribution. (5) The reclassification (including any reclassification upon a consolidation or merger in which the Company is the continuing corporation) of Common Stock into securities including other than Common Stock shall be deemed to involve (a) a distribution of such securities other than Common Stock to all holders of Common Stock (and the effective date of such reclassification shall be deemed to be "the date fixed for the determination of stockholders entitled to receive such distribution" and "the date fixed for such determination" within the meaning of paragraph (4) of this Section), and (b) a subdivision or combination, as the case may be, of the number of shares of Common Stock outstanding immediately prior to such reclassification into the number of shares of Common Stock outstanding immediately thereafter (and the effective date of such reclassification shall be deemed to be "the day upon which such subdivision becomes effective" or "the day upon which such combination becomes effective", as the case may be, and "the day upon which such subdivision or combination becomes effective" within the meaning of paragraph (3) of this Section). (6) For the purpose of any computation under paragraphs (2) and (4) of this Section, the current market price per share of Common Stock on any date shall be deemed to be the average of the daily closing prices for the 15 consecutive Business Days selected by the Company commencing not less than 20 nor more than 30 Business Days before the day in question. The closing price for each day shall be determined in the manner set forth in Section 1303. (7) The Company may from time to time reduce, in addition to those required by paragraphs (1), (2), (3) and (4) of this Section, the conversion price of Debt Securities of any series by any amount for any period if the period is at least 20 days and if the reduction is irrevocable during the period. (8) Notwithstanding the provisions of this Article, the conversion price per share shall not be reduced 74 to less than the par value thereof as a result of any adjustment made hereunder. (9) No adjustment in the conversion price shall be required unless such adjustment would require an increase or decrease of at least 1% in such price; provided, however, that any adjustment which by reason of this paragraph -------- ------- (9) is not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Article Thirteen shall be made to the nearest cent or the nearest one-hundredth of a share, as the case may be. SECTION 1305. Notice of Adjustments of Conversion Price. ----------------------------------------- Whenever the conversion price of any Debt Security is adjusted as herein provided: (a) the Company shall compute the adjusted conversion price in accordance with Section 1304 and shall prepare an Officers' Certificate setting forth the adjusted conversion price and showing in reasonable detail the facts upon which such adjustment is based, and such certificate shall forthwith be filed at each office or agency maintained for the purpose of conversion of Debt Securities. (b) a notice stating that the conversion price has been adjusted and setting forth the adjusted conversion price shall be mailed by the Company to the Trustee and the Holders of Debt Securities for which the conversion price has been adjusted as herein provided. SECTION 1306. Notice of Certain Corporate Action. ---------------------------------- In case: (a) the Company shall declare a dividend (or any other distribution) on its Common Stock payable otherwise than in cash out of its consolidated earnings or retained earnings; or (b) the Company shall authorize the granting to all the holders of its Common Stock of rights or warrants to subscribe for or purchase any shares of capital stock of any class or of any other rights (other than a dividend or distribution payable in cash out of the consolidated earnings or retained earnings of the Company); or 75 (c) of any reclassification of the Common Stock of the Company (other than a subdivision or combination of its outstanding shares of Common Stock); or (d) of the voluntary or involuntary dissolution liquidation or winding up of the Company; then the Company shall cause to be filed at each office or agency maintained for the purpose of conversion of Debt Securities, and shall cause to be mailed to the Holders of Debt Securities entitled to the conversion privilege as herein provided, at least 20 days (or 10 days in any case specified in clause (a) or (b) above) prior to the applicable record date hereinafter specified, a notice stating (x) the date on which a record is to be taken for the purpose of such dividend, distribution, rights or warrants, or, if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distribution, rights or warrants are to be determined, or (y) the date on which such reclassification, dissolution, liquidation or winding up is expected to become effective, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, dissolution, liquidation or winding up. SECTION 1307. Taxes on Conversions. -------------------- The Company will pay any and all taxes that may be payable in respect of the issue or delivery of shares of Common Stock on conversion of Debt Securities pursuant hereto. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of shares of Common Stock in a name other than that of the Holder of the Debt Security or Debt Securities to be converted, and no such issue or delivery shall be made unless and until the person requesting such issue has paid to the Company the amount of any such tax, or has established to the satisfaction of the Company that such tax has been paid. ARTICLE FOURTEEN RESTRICTIONS ON TRANSFER SECTION 1401. Restrictions on Transfer. ------------------------ Any transfer of Debt Securities that, if effective, would result in any Person becoming the Beneficial Owner of more than 9.9% of the outstanding stock of the Company shall be deemed void ab initio, and the intended transferee --------- shall be deemed never to have had an 76 interest therein. The Trustee shall have no duty, responsibility or liability in connection with the observation or enforcement of the aforementioned restriction on transfer or the consequences of any breach or violation of such restriction or the correction of any such breach or violation. * * * * * * This instrument may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument. 77 IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed, all as of the day and year first above written. NATIONWIDE HEALTH PROPERTIES, INC. By ___________________________ R. Bruce Andrews President and Chief Executive Officer Trustee, THE BANK OF NEW YORK By ___________________________ Name: Title: S-1 EX-4.3 3 FORM OF DEPOSIT AGREEMENT EXHIBIT 4.3 [FORM OF DEPOSIT AGREEMENT] ================================================================================ NATIONWIDE HEALTH PROPERTIES, INC., ______________________________, As Depositary AND THE HOLDERS FROM TIME TO TIME OF THE DEPOSITARY RECEIPTS DESCRIBED HEREIN ----------------- Deposit Agreement ----------------- Dated as of __________, 199__ ================================================================================ TABLE OF CONTENTS _________________
Page ---- PARTIES................................................................ 1 RECITALS............................................................... 1 ARTICLE I Definitions.......................... 1 ----------- Articles Supplementary............................................ 1 Common Stock...................................................... 1 Company........................................................... 1 Deposit Agreement................................................. 1 Depositary........................................................ 1 Depositary Shares................................................. 1 Depositary's Agent................................................ 2 Depositary's Office............................................... 2 Receipt........................................................... 2 Record Holder..................................................... 2 Stock............................................................. 2 ARTICLE II Form of Receipts, Deposit of Stock, Execution and Delivery, Transfer, Surrender and Redemption of Receipts........ 2 SECTION 2.01. Form and Transfer of Receipts...................... 2 SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof..................... 3 SECTION 2.03. Redemption of Stock................................ 4 SECTION 2.04. Conversion of Stock into Common Stock.............. 6 SECTION 2.05. Registration of Transfer of Receipts............... 6 SECTION 2.06. Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock.............................................. 7 SECTION 2.07. Limitations on Execution and Delivery, Transfer, Surrender and Exchange of Receipts........................................... 8 SECTION 2.08. Lost Receipts, etc................................. 8 SECTION 2.09. Cancellation and Destruction of Surrendered Receipts............................... 9 ARTICLE III Certain Obligations of the Holders of Receipts and the Company.................. 9 SECTION 3.01. Filing Proofs, Certificates and Other Information........................................ 9 SECTION 3.02. Payment of Taxes or Other Governmental Charges............................................ 9 SECTION 3.03. Warranty as to Stock............................... 9 SECTION 3.04. Covenants and Warranties as to Common
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Page ---- Stock.............................................. 10 ARTICLE IV The Deposited Securities; Notices............... 10 SECTION 4.01. Cash Distributions................................. 10 SECTION 4.02. Distributions Other than Cash...................... 10 SECTION 4.03. Subscription Rights, Preferences or Privileges......................................... 11 SECTION 4.04. Notice of Dividends, etc.; Fixing of Record Date for Holders of Receipts................ 12 SECTION 4.05. Voting Rights...................................... 12 SECTION 4.06. Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, etc................................................ 13 SECTION 4.07. Delivery of Reports................................ 13 SECTION 4.08. List of Receipt Holders............................ 14 ARTICLE V The Depositary, the Depositary's Agents and the Company........................ 14 SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by the Depositary................... 14 SECTION 5.02. Prevention of or Delay in Performance by the Depositary, the Depositary's Agents or the Company..................................... 14 SECTION 5.03. Obligations of the Depositary, the Depositary's Agents and the Company................ 15 SECTION 5.04. Resignation and Removal of the Depositary; Appointment of Successor Depositary......................................... 16 SECTION 5.05. Corporate Notices and Reports...................... 17 SECTION 5.06. Indemnification by the Company..................... 17 SECTION 5.07. Charges and Expenses............................... 17 ARTICLE VI Amendment and Termination................... 18 SECTION 6.01. Amendment.......................................... 18 SECTION 6.02. Termination........................................ 18 ARTICLE VII Miscellaneous......................... 19 SECTION 7.01. Counterparts....................................... 19 SECTION 7.02. Exclusive Benefit of Parties....................... 19 SECTION 7.03. Invalidity of Provisions........................... 19
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Page ---- SECTION 7.04. Notices............................................ 19 SECTION 7.05. Depositary's Agents................................ 20 SECTION 7.06. Holders of Receipts Are Parties.................... 20 SECTION 7.07. Governing Law...................................... 20 SECTION 7.08. Inspection of Deposit Agreement.................... 20 SECTION 7.09. Headings........................................... 20 TESTIMONIUM............................................................ 21 SIGNATURES............................................................. 21 EXHIBIT A: Form of Depositary Receipt
iii DEPOSIT AGREEMENT dated as of __________, 199__, among NATIONWIDE HEALTH PROPERTIES, INC., a Maryland corporation, _________________________, a __________ ________________, and the holders from time to time of the Receipts described herein. WHEREAS it is desired to provide, as hereinafter set forth in this Deposit Agreement, for the deposit of shares of _____% __________ Preferred Stock, $1.00 par value, of NATIONWIDE HEALTH PROPERTIES, INC. with the Depositary (as hereinafter defined) for the purposes set forth in this Deposit Agreement and for the issuance hereunder of Receipts (as hereinafter defined) evidencing Depositary Shares (as hereinafter defined) so deposited; NOW, THEREFORE, in consideration of the premises, the parties hereto agree as follows: ARTICLE I Definitions ----------- The following definitions shall for all purposes, unless otherwise indicated, apply to the respective terms used in this Deposit Agreement and the Receipts: "Articles Supplementary" shall mean the Board of Directors' resolution and/or the articles supplementary filed with the Maryland State Department of Assessments and Taxation establishing the Stock as a series of preferred stock of the Company. "Common Stock" shall mean the shares of the Company's Common Stock, $.10 par value. "Company" shall mean Nationwide Health Properties, Inc., a Maryland corporation, and its successors. "Deposit Agreement" shall mean this Deposit Agreement, as amended or supplemented from time to time. "Depositary" shall mean ____________________, and any successor as Depositary and registrar to register ownership and transfers of Depositary Shares hereunder as herein provided. 1 "Depositary Shares" shall mean Depositary Shares, each representing a __________ interest in a share of Stock and evidenced by a Receipt. "Depositary's Agent" shall mean an agent appointed by the Depositary pursuant to Section 7.05. "Depositary's Office" shall mean the principal office of the Depositary in __________, _______________, at which at any particular time its depositary receipt business shall be administered. "Receipt" shall mean one of the depositary receipts issued hereunder, whether in definitive or temporary form. "Record Holder" as applied to a Receipt shall mean the person in whose name a Receipt is registered on the books of the Depositary maintained for such purpose. "Stock" shall mean shares of the Company's _____% __________ Preferred Stock, $1.00 par value. ARTICLE II Form of Receipts, Deposit of Stock, Execution and Delivery, ----------------------------------------------------------- Transfer, Surrender and Redemption of Receipts ---------------------------------------------- SECTION 2.01. Form and Transfer of Receipts. Definitive Receipts ----------------------------- shall be engraved or printed or lithographed and shall be substantially in the form set forth in Exhibit A annexed to this Deposit Agreement, with appropriate insertions, modifications and omissions, as hereinafter provided. Pending the preparation of definitive Receipts, the Depositary, upon the written order of the Company delivered in compliance with Section 2.02, shall execute and deliver temporary Receipts which are printed, lithographed, typewritten, mimeographed or otherwise substantially of the tenor of the definitive Receipts in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the persons executing such Receipts may determine, as evidenced by their execution of such Receipts. If temporary Receipts are issued, the Company and the Depositary will cause definitive Receipts to be prepared without unreasonable delay. After the preparation of definitive Receipts, the temporary Receipts shall be exchangeable for definitive Receipts upon surrender of the temporary Receipts at an office described in the third paragraph of Section 2.02, without charge to the holder. Upon surrender for cancellation of any one or more temporary Receipts, the Depositary shall execute and deliver in exchange therefor definitive Receipts representing the same number of Depositary Shares as represented by the surrendered temporary Receipt or Receipts. Such exchange shall be made at the Company's expense and without any charge therefor. 2 Until so exchanged, the temporary Receipts shall in all respects be entitled to the same benefits under this Deposit Agreement, and with respect to the Stock, as definitive Receipts. Receipts shall be executed by the Depositary by the manual signature of a duly authorized officer of the Depositary. No Receipt shall be entitled to any benefits under this Deposit Agreement or be valid or obligatory for any purpose unless it shall have been executed manually by a duly authorized officer of the Depositary. The Depositary shall record on its books each Receipt so signed and delivered as hereinafter provided. Receipts shall be in denominations of any number of whole Depositary Shares. Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent with the provisions of this Deposit Agreement as may be required by the Company or the Depositary or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Stock, the Depositary Shares or the Receipts may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject. Title to Depositary Shares evidenced by a Receipt which is properly endorsed, or accompanied by a properly executed instrument of transfer, shall be transferable by delivery with the same effect as in the case of a negotiable instrument; provided, however, that until transfer of a Receipt shall be ----------------- registered on the books of the Depositary as provided in Section 2.05, the Depositary may, notwithstanding any notice to the contrary, treat the record holder thereof at such time as the absolute owner thereof for the purpose of determining the person entitled to receive distributions of dividends or other distributions, withdraw any Stock underlying the Depositary Shares, exercise any conversion rights or to receive any notice provided for in this Deposit Agreement and for all other purposes. SECTION 2.02. Deposit of Stock; Execution and Delivery of Receipts in ------------------------------------------------------- Respect Thereof. Subject to the terms and conditions of this Deposit Agreement, - --------------- the Company may from time to time deposit shares of Stock under this Deposit Agreement by delivery to the Depositary of a certificate or certificates for the Stock to be deposited, properly endorsed or accompanied, if required by the Depositary, by a duly executed instrument of transfer or endorsement, in form satisfactory to the Depositary, together with all such certifications as may be required by the Depositary in accordance with the provisions of this Deposit Agreement, and together with a written order of the Company directing the Depositary to execute and deliver to, or upon the 3 written order of, the person or persons stated in such order a Receipt or Receipts for the number of Depositary Shares relating to such deposited Stock. Deposited Stock shall be held by the Depositary at the Depositary's Office or at such other place or places as the Depositary shall determine. Upon receipt by the Depositary of a certificate or certificates for Stock deposited in accordance with the provisions of this Section, together with the other documents required as above specified, and upon recordation of the Stock so deposited on the books of the Company in the name of the Depositary or its nominee, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall execute and deliver, to or upon the order of the person or persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section, a Receipt or Receipts for the number of Depositary Shares relating to the Stock so deposited and registered in such name or names as may be requested by such person or persons. The Depositary shall execute and deliver such Receipt or Receipts at the Depositary's Office or such other offices, if any, as the Depositary may designate. Delivery at other offices shall be at the risk and expense of the person requesting such delivery. Other than in the case of splits, combinations or other reclassifications affecting the Stock, or in the case of dividends or other distributions of Stock, if any, there shall be deposited hereunder not more than __________ shares of Stock. SECTION 2.03. Redemption of Stock. Whenever the Company shall elect ------------------- to redeem shares of Stock in accordance with the provisions of the Articles Supplementary, it shall (unless otherwise agreed in writing with the Depositary) mail notice to the Depositary of such proposed redemption, by first class mail, postage prepaid not less than 30 nor more than 60 days prior to the date fixed for redemption of Stock in accordance with the Articles Supplementary. On the date of such redemption, provided that the Company shall then have paid in full to the Depositary the redemption price of the Stock to be redeemed, as set forth in the Articles Supplementary, plus any accrued and unpaid dividends thereon to and including the Redemption Date (as defined below), the Depositary shall redeem the Depositary Shares relating to such Stock. The Depositary shall mail notice of such redemption and the proposed simultaneous redemption of the number of Depositary Shares relating to the Stock to be redeemed, by first-class mail, postage prepaid, not less than 30 and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares (the "Redemption Date"), to the record holders of the Receipts evidencing the Depositary Shares to be so redeemed, at the addresses of such holders as they appear on the records of the Depositary; but neither failure to mail any such 4 notice to one or more such holders nor any defect in any notice to one or more such holders shall affect the sufficiency of the proceedings for redemption as to other holders. Each such notice shall state: (i) the Redemption Date; (ii) the number of Depositary Shares to be redeemed and, if less than all the Depositary Shares held by any such holder are to be redeemed, the number of such Depositary Shares held by such holder to be so redeemed; (iii) the redemption price (which shall include any accrued and unpaid dividends to and including the Redemption Date); (iv) the place or places where Receipts evidencing Depositary Shares are to be surrendered for payment of the redemption price; (v) that dividends in respect of the Stock underlying the Depositary Shares to be redeemed will cease to accumulate after the close of business on such Redemption Date; and (vi) that the right to convert Depositary Shares into shares of Common Stock, if applicable, will expire after the close of business on the _____ day preceding the Redemption Date; the then-effective conversion price and the place or places where Receipts evidencing such Depositary Shares are to be surrendered for conversion. In case less than all the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be so redeemed shall be selected by lot or pro rata (subject to rounding to avoid fractions of Depositary Shares) as may be determined by the Depositary to be equitable. Notice having been mailed by the Depositary as aforesaid (unless the Company shall have failed to redeem the shares of Stock to be redeemed by it as set forth in the Company's notice provided for in the preceding paragraph), (i) after the close of business on the _____ day preceding the Redemption Date, all conversion rights in respect of the Depositary Shares called for redemption on such Redemption Date will terminate and (ii) from and after the Redemption Date all dividends in respect of the Depositary Shares so called for redemption shall cease to accumulate, the Depositary Shares being redeemed from such proceeds shall be deemed no longer to be outstanding, all remaining rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the redemption price without interest) shall, to the extent of such Depositary Shares, cease and terminate and, upon surrender in accordance with such notice of the Receipts evidencing any such Depositary Shares (properly endorsed or assigned for transfer, if the Depositary shall so require), such Depositary Shares shall be redeemed by the Depositary at a redemption price per Depositary Share equal to __________ of the redemption price per share paid in respect of the shares of Stock plus all money and other property, if any, paid with respect to such Depositary Shares, including all amounts paid by the Company in respect of dividends which on the Redemption Date have accumulated on the shares of Stock to be so redeemed and have not theretofore been paid. 5 If less than all the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of such Receipt upon its surrender to the Depositary, together with the redemption payment, a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption. SECTION 2.04. Conversion of Stock into Common Stock. The Company ------------------------------------- hereby agrees to accept the delivery of Receipts for purposes of effecting conversions of the Stock utilizing the same procedures as those provided for delivery of certificates for the Stock to effect such conversions in accordance with the terms and conditions of the Stock as provided in the Articles Supplementary. Any whole number of Depositary Shares (whether or not evenly divisible by ____) represented by a Receipt may be surrendered for conversion. If the Depositary Shares represented by a Receipt are to be converted in part only, a new Receipt or Receipts will be issued by the Depositary for the Depositary Shares not to be converted. No fractional shares of Common Stock will be issued upon conversion, and if such conversion will result in a fractional share being issued, an amount will be paid in cash by the Company equal to the value of the fractional interest based upon the closing price of the Common Stock on the last business day prior to the conversion. For this purpose, a holder of a Receipt or Receipts must surrender such Receipt or Receipts to the Company, together with a duly completed and executed Notice of Conversion in the form included in the Receipt. In all cases the foregoing shall be conditioned upon compliance in full by the holders with the applicable terms and conditions of the Stock as provided in the Articles Supplementary and of this Deposit Agreement. The Company and the Depositary will thereafter effect the cancellation of each Receipt surrendered for such conversion and of the related Stock so converted. In the event that the conversion of Depositary Shares results in issuance of a fraction of a share of Stock, the Depositary will make appropriate adjustment in its records to reflect such issuance and, if appropriate, the combination of any fractions of shares into one or more whole shares of Stock. Upon conversion no adjustments will be made for accrued dividends and, therefore, Depositary Shares surrendered for conversion after the record date next preceding a dividend payment date for the Stock and prior to such dividend payment date must be accompanied by payment of an amount equal to the applicable fraction of the dividend thereon which is to be paid on such dividend payment date (unless the Depositary Shares surrendered for conversion have been called for redemption prior to such dividend payment date). No adjustment of the conversion price will be required to be made in any case until cumulative adjustment amounts to 1% or more of the conversion price. SECTION 2.05. Registration of Transfer of Receipts. Subject to the ------------------------------------ terms and conditions of this Deposit Agreement, 6 the Depositary shall register on its books from time to time transfers of Receipts upon any surrender thereof by the holder in person or by duly authorized attorney, properly endorsed or accompanied by a properly executed instrument of transfer. Thereupon the Depositary shall execute a new Receipt or Receipts evidencing the same aggregate number of Depositary Shares as those evidenced by the Receipt or Receipts surrendered and deliver such new Receipt or Receipts to or upon the order of the person entitled thereto. SECTION 2.06. Split-ups and Combinations of Receipts; Surrender of ---------------------------------------------------- Receipts and Withdrawal of Stock. Upon surrender of a Receipt or Receipts at - -------------------------------- the Depositary's Office or at such other offices as it may designate for the purpose of effecting a split-up or combination of such Receipt or Receipts, and subject to the terms and conditions of this Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in the denominations requested, evidencing the aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered. Any holder of a Receipt or Receipts evidencing at least __________ Depositary Shares may withdraw the number of whole shares of Stock underlying such Depositary Shares and all money and other property, if any, relating thereto by surrendering Receipts evidencing such Depositary Shares at the Depositary's Office or at such other offices as the Depositary may designate for such withdrawals. Thereafter, without unreasonable delay, the Depositary shall deliver to such holder, or to the person or persons designated by such holder as hereinafter provided, the number of whole shares of Stock and all money and other property, if any, relating to the Depositary Shares evidenced by the Receipts so surrendered for withdrawal, but holders of such whole shares of Stock will not thereafter be entitled to deposit such Stock hereunder or to receive Receipts evidencing Depositary Shares therefor. If a Receipt delivered by a holder to the Depositary in connection with such withdrawal shall evidence a number of Depositary Shares relating to other than a number of whole shares of Stock, the Depositary shall at the same time, in addition to such number of whole shares of Stock and such money and other property, if any, to be so withdrawn, deliver to such holder, or (subject to Section 3.02) upon his order, a new Receipt evidencing such excess number of Depositary Shares. Delivery of the Stock and money and other property being withdrawn may be made by delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate. HOLDERS ACKNOWLEDGE THAT THERE WILL BE NO MARKET FOR THE UNDERLYING STOCK AND THAT UPON WITHDRAWAL OF THE STOCK, HOLDERS THEREOF WILL NOT BE ENTITLED THEREAFTER TO DEPOSIT SUCH STOCK UNDER THIS DEPOSIT AGREEMENT. 7 If the Stock and the money and other property being withdrawn are to be delivered to a person or persons other than the record holder of the Receipts being surrendered for withdrawal of Stock, such holder shall execute and deliver to the Depositary a written order so directing the Depositary, and the Depositary may require that the Receipt or Receipts surrendered by such holder for withdrawal of such shares of Stock be properly endorsed in blank or accompanied by a properly executed instrument of transfer. Delivery of the Stock and the money and other property, if any, underlying the Depositary Shares evidenced by the Receipts surrendered for withdrawal shall be made by the Depositary at the Depositary's Office, except that, at the request, risk and expense of the holder surrendering such Receipts and for the account of such holder, such delivery may be made at such other place as may be designated by such holder. SECTION 2.07. Limitations on Execution and Delivery, Transfer, ------------------------------------------------ Surrender and Exchange of Receipts. As a condition precedent to the execution - ---------------------------------- and delivery, registration of transfer, split-up, combination, surrender, exchange or redemption of any Receipt, the withdrawal of any Stock underlying the Depositary Shares or the exercise of any conversion rights, the Depositary, any of the Depositary's Agents or the Company may require payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any charges or expenses payable by the holder of a Receipt pursuant to Section 5.07, may require the production of evidence satisfactory to it as to the identity and genuineness of any signature and may also require compliance with such regulations, if any, as the Depositary or the Company may establish consistent with the provisions of this Deposit Agreement. The exercise of any conversion rights or the withdrawal of any Stock underlying the Depositary Shares may be suspended, the delivery of Receipts against Stock may be suspended, the registration of transfer of Receipts may be refused and the registration of transfer, surrender, exchange or redemption of outstanding Receipts may be suspended (i) during any period when the register of stockholders of the Company is closed or (ii) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary's Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission or under any provision of this Deposit Agreement. SECTION 2.08. Lost Receipts, etc. In case any Receipt shall be ------------------ mutilated, destroyed, lost or stolen, the Depositary in its discretion may execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt, or in lieu of and in substitution for such destroyed, lost or stolen 8 Receipt, upon (i) the filing by the holder thereof with the Depositary of evidence satisfactory to the Depositary of such destruction or loss or theft of such Receipt, of the authenticity thereof and of his or her ownership thereof and (ii) the furnishing of the Depositary with reasonable indemnification satisfactory to it. SECTION 2.09. Cancellation and Destruction of Surrendered Receipts. ---------------------------------------------------- All Receipts surrendered to the Depositary or any Depositary's Agent shall be canceled by the Depositary. Except as prohibited by applicable law or regulation, the Depositary is authorized to destroy all Receipts so canceled. ARTICLE III Certain Obligations of the Holders ---------------------------------- of Receipts and the Company --------------------------- SECTION 3.01. Filing Proofs, Certificates and Other Information. Any ------------------------------------------------- holder of a Receipt may be required from time to time to file such proof of residence, or other matters or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold the delivery, or delay the registration of transfer, redemption or exchange, of any Receipt, the exercise of any conversion rights, the withdrawal of any Stock underlying the Depositary Shares or the distribution of any dividend or other distribution or the sale of any rights or of the proceeds thereof until such proof or other information is filed or such certificates are executed or such representations and warranties are made. SECTION 3.02. Payment of Taxes or Other Governmental Charges. ---------------------------------------------- Holders of Receipts shall be obligated to make payments to the Depositary of certain taxes, charges and expenses, as provided in Section 5.07. Registration of transfer of any Receipt, the exercise of any conversion rights, any withdrawal of Stock and delivery of all money or other property, if any, represented by the Depositary Shares evidenced by such Receipt may be refused until any such payment due is made, and any dividends, interest payments or other distributions may be withheld or all or any part of the Stock or other property relating to the Depositary Shares evidenced by such Receipt and not theretofore sold may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder prior to such sale), and such dividends, interest payments or other distributions or the proceeds of any such sale may be applied to any payment of such taxes, charges or expenses, the holder of such Receipt remaining liable for any deficiency. 9 SECTION 3.03. Warranty as to Stock. The Company hereby represents -------------------- and warrants that the Stock, when issued, will be validly issued, fully paid and nonassessable. Such representation and warranty shall survive the deposit of the Stock and the issuance of Receipts. SECTION 3.04. Covenants and Warranties as to Common Stock. The ------------------------------------------- Company covenants that it will keep reserved or otherwise available a sufficient number of authorized and unissued shares of Common Stock to meet conversion requirements in respect of the Depositary Shares and that it will give written notice to the Depositary of any adjustments in the conversion price made pursuant to the Articles Supplementary. The Company represents and warrants that the Common Stock issued upon conversion of the Depositary Shares will be validly issued, fully paid and non-assessable. ARTICLE IV The Deposited Securities; Notices --------------------------------- SECTION 4.01. Cash Distributions. Whenever the Depositary shall ------------------ receive any cash dividend or other cash distribution on the Stock, the Depositary shall, subject to Sections 3.01 and 3.02, distribute to the record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of such dividend or distribution as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or -------- ------- the Depositary shall be required to withhold and shall withhold from any cash dividend or other cash distribution in respect of the Stock an amount on account of taxes and governmental charges, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. The Depositary shall distribute or make available for distribution, as the case may be, only such amount, however, as can be distributed without attributing to any holder of Receipts a fraction of one cent, and any balance not so distributable shall be held by the Depositary (without liability for interest thereon) and shall be added to and be treated as part of the next sum received by the Depositary for distribution to record holders of Receipts then outstanding. SECTION 4.02. Distributions Other than Cash. Whenever the ----------------------------- Depositary shall receive any distribution other than cash on the Stock, the Depositary shall, subject to Sections 3.01 and 3.02, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.04 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of Depositary Shares evidenced by the Receipts held by such holders, in any manner that the Depositary may deem equitable and 10 practicable for accomplishing such distribution. If in the opinion of the Depositary such distribution cannot be made proportionately among such record holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes and governmental charges) the Depositary deems, after consultation with the Company, such distribution not to be feasible, the Depositary may, with the approval of the Company, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or private sale) of the securities or property thus received, or any part thereof, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Sections 3.01 and 3.02, be distributed or made available for distribution, as the case may be, by the Depositary to record holders of Receipts as provided by Section 4.01 in the case of a distribution received in cash. SECTION 4.03. Subscription Rights, Preferences or Privileges. If the ---------------------------------------------- Company shall at any time offer or cause to be offered to the persons in whose names Stock is recorded on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such rights, preferences or privileges shall in each such instance be made available by the Depositary to the record holders of Receipts in such manner as the Depositary may determine, either by the issue to such record holders of warrants representing such rights, preferences or privileges or by such other method as may be approved by the Depositary in its discretion with the approval of the Company; provided, -------- however, that (i) if at the time of issue or offer of any such rights, - ------- preferences or privileges the Depositary determines that it is not lawful or (after consultation with the Company) not feasible to make such rights, preferences or privileges available to holders of Receipts by the issue of warrants or otherwise, or (ii) if and to the extent so instructed by holders of Receipts who do not desire to exercise such rights, preferences or privileges, then the Depositary, in its discretion (with the approval of the Company, in any case where the Depositary has determined that it is not feasible to make such rights, preferences or privileges available), may, if applicable laws or the terms of such rights, preferences or privileges permit such transfer, sell such rights, preferences or privileges at public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Sections 3.01 and 3.02, be distributed by the Depositary to the record holders of Receipts entitled thereto as provided by Section 4.01 in the case of a distribution received in cash. If registration under the Securities Act of 1933, as amended (the "Act"), of the securities to which any rights, preferences or privileges relate is required in order for holders 11 of Receipts to be offered or sold the securities to which such rights, preferences or privileges relate, the Company agrees with the Depositary that the Company will notify the Depositary and file promptly a registration statement pursuant to such Act with respect to such rights, preferences or privileges and securities and use its best efforts and take all steps available to it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In no event shall the Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until such a registration statement shall have become effective, or unless the offering and sale of such securities to such holders are exempt from registration under the provisions of the Act. If any other action under the laws of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company agrees with the Depositary that the Company will notify the Depositary and use its best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. SECTION 4.04. Notice of Dividends, etc.; Fixing of Record Date for ---------------------------------------------------- Holders of Receipts. Whenever any cash dividend or other cash distribution - ------------------- shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered, with respect to the Stock, or whenever the Depositary shall receive notice of any meeting or action to be taken by written consent at or as to which holders of Stock are entitled to vote or consent, or of which holders of Stock are entitled to notice, the Depositary shall in each such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to the Stock) for the determination of the holders of Receipts who shall be entitled to receive a distribution in respect of such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of any rights to vote or consent at any such meeting or with respect to any such action, or who shall be entitled to receive notice of such meeting or such action. SECTION 4.05. Voting Rights. Upon receipt of notice of any meeting ------------- or action to be taken by written consent at or as to which the holders of the Stock are entitled to vote or consent, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice which shall contain (i) such information as is contained in such notice of 12 meeting or action and (ii) a statement informing holders of Receipts that they may instruct the Depositary as to the exercise of the voting rights or the giving or refusal of consent, as the case may be, pertaining to the amount of Stock underlying their respective Depositary Shares and a brief statement as to the manner in which such instructions may be given. Upon the written request of the holders of Receipts on the record date (which shall be the same date as the record date for the Stock), the Depositary shall endeavor insofar as practicable to vote or cause to be voted, or give or withhold consent with respect to, in accordance with the instructions set forth in such requests, the maximum number of whole shares of Stock underlying the Depositary Shares evidenced by all Receipts as to which any particular voting or consent instructions are received. The Company hereby agrees to take all action which may be deemed necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted or give or withhold consent with respect to such Stock. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting, or giving consents (but, at its discretion, not from appearing at any meeting with respect to such Stock unless directed to the contrary by the holders of a majority of the Receipts) to the extent of the Stock underlying the Depositary Shares evidenced by such Receipt. The Company also agrees that it will at all times comply with the proxy rules of the Securities Exchange Act of 1934, as amended. SECTION 4.06. Changes Affecting Deposited Securities and ------------------------------------------ Reclassifications, Recapitalizations, etc. Upon any change in par or stated - ----------------------------------------- value, split-up, combination or any other reclassification of the Stock, or upon any recapitalization, reorganization, merger, amalgamation or consolidation affecting the Company or to which it is a party or sale of all or substantially all the Company's assets, the Depositary may in its discretion, with the approval of, and shall upon the instructions of, the Company, and (in either case) in such manner as the Depositary may deem equitable, (i) make such adjustments in (a) the fraction of an interest in one share of Stock underlying one Depositary Share and (b) the ratio of the redemption price per Depositary Share to the redemption price of a share of the Stock, in each case as may be necessary fully to reflect the effects of such change in par or stated value, split-up, combination or other reclassification of the Stock, or of such recapitalization, reorganization, merger, amalgamation or consolidation or sale and (ii) treat any securities which shall be received by the Depositary in exchange for or upon conversion of or in respect of the Stock as new deposited securities so received in exchange for or upon conversion of or in respect of such Stock. In any such case the Depositary may in its discretion, with the approval of the Company, execute and deliver additional Receipts, or may call for the surrender of all outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited securities. 13 SECTION 4.07. Delivery of Reports. The Depositary will forward to ------------------- record holders of Receipts, at their respective addresses appearing in the Depositary's books, all notices, reports and communications received from the Company which are delivered to the Depositary and which the Company is required to furnish to the holders of Stock or Receipts. SECTION 4.08. List of Receipt Holders. Promptly upon request from ----------------------- time to time by the Company, the Depositary shall furnish to it a list, as of a recent date, of the names, addresses and holdings of Stock of all persons in whose names Receipts are registered on the books of the Depositary. ARTICLE V The Depositary, the Depositary's Agents --------------------------------------- and the Company --------------- SECTION 5.01. Maintenance of Offices, Agencies and Transfer Books by ------------------------------------------------------ the Depositary. Upon execution of this Deposit Agreement, the Depositary shall - -------------- maintain at the Depositary's Office, facilities for the execution and delivery, registration and registration of transfer, surrender and exchange of Receipts, and at the offices of the Depositary's Agents, if any, facilities for the delivery, registration of transfer, surrender and exchange of Receipts, all in accordance with the provisions of this Deposit Agreement. The Depositary shall keep books at the Depositary's Office for the registration and registration of transfer of Receipts, which books at all reasonable times shall be open for inspection by the record holders of Receipts; provided, that any such holder requesting to exercise such right shall certify - -------- to the Depositary that such inspection shall be for a proper purpose reasonably related to such person's interest as an owner of Depositary Shares evidenced by the Receipts. The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder. If the Receipts or the Depositary Shares evidenced thereby or the Stock represented by such Depositary Shares shall be listed on the New York Stock Exchange or any other stock exchange, the Depositary will, at the request of the Company, arrange such facilities for the delivery, registration, registration of transfer, surrender, exchange, redemption or conversion of such Receipts, such Depositary Shares or such Stock as applicable and as may be required by law or applicable stock exchange regulation. 14 SECTION 5.02. Prevention of or Delay in Performance by the -------------------------------------------- Depositary, the Depositary's Agents or the Company. Neither the Depositary nor - -------------------------------------------------- any Depositary's Agent nor the Company shall incur any liability to any holder of any Receipt if by reason of any provision of any present or future law, or regulation thereunder, of the United States of America or of any other governmental authority or, in the case of the Depositary or any Depositary's Agent, by reason of any provision, present or future, of the Company's Amended and Restated Articles of Incorporation, as amended (including the Articles Supplementary) or by reason of any act of God or war or other circumstance beyond the control of the relevant party, the Depositary, any Depositary's Agent or the Company shall be prevented or forbidden from doing or performing any act or thing which the terms of this Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary's Agent or the Company incur any liability to any holder of a Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing which the terms of this Deposit Agreement provide shall or may be done or performed, or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement except, in case of any such exercise or failure to exercise discretion not caused as aforesaid, if caused by the gross negligence or willful misconduct of the party charged with such exercise or failure to exercise. SECTION 5.03. Obligations of the Depositary, the Depositary's Agents ------------------------------------------------------ and the Company. Neither the Depositary nor any Depositary's Agent nor the - --------------- Company assumes any obligation or shall be subject to any liability under this Deposit Agreement to holders of Receipts other than for its gross negligence or willful misconduct. Neither the Depositary nor any Depositary's Agent nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of the Stock, the Depositary Shares or the Receipts which in its opinion may involve it in expense or liability unless indemnity satisfactory to it against all expense and liability be furnished as often as may be required. Neither the Depositary nor any Depositary's Agent nor the Company shall be liable for any action or any failure to act by it in reliance upon the written advice of legal counsel or accountants, or information from any person presenting Stock for deposit, any holder of a Receipt or any other person believed by it in good faith to be competent to give such information. The Depositary, any Depositary's Agent and the Company may each rely and shall each be protected in acting upon any written notice, request, direction or other document believed by it to be genuine and to have been signed or presented by the proper party or parties. 15 The Depositary shall not be responsible for any failure to carry out any instruction to vote or give or withhold consent, with respect to any of the shares of Stock or for the manner or effect of any such vote or consent, as long as any such action or non-action is in good faith. The Depositary undertakes to perform such duties and only such duties as are specifically set forth in this Deposit Agreement, and no implied covenants or obligations shall be read into this Deposit Agreement against the Depositary. The Depositary will indemnify the Company against any liability which may arise out of acts performed or omitted by the Depositary or its agents due to its or their gross negligence or willful misconduct. The Depositary, the Depositary's Agents and the Company may own and deal in any class of securities of the Company and its affiliates and in Receipts. The Depositary may also act as transfer agent and registrar of any of the securities of the Company and its affiliates. SECTION 5.04. Resignation and Removal of the Depositary; Appointment ------------------------------------------------------ of Successor Depositary. The Depositary may at any time resign as Depositary - ----------------------- hereunder by written notice of its election so to do delivered to the Company, such resignation to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided. The Depositary may at any time be removed by the Company by written notice of such removal delivered to the Depositary, such removal to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided. In case the Depositary acting hereunder shall at any time resign or be removed, the Company shall, within 60 days after the delivery of the notice of resignation or removal, as the case may be, appoint a successor Depositary, which shall be a bank or trust company having its principal office in the United States of America and having a combined capital and surplus of at least $50,000,000. Every successor Depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor Depositary, without any further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit Agreement, and such predecessor, upon payment of all sums due it and on the written request of the Company, shall execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Stock and any moneys or property held hereunder to such successor and shall deliver to such successor a list of the record holders of all outstanding Receipts. Any successor Depositary shall promptly mail notice of its appointment to the record holders of Receipts. 16 Any corporation into or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or, any further act. Such successor Depositary may authenticate the Receipts in the name of the predecessor Depositary or in the name of the successor Depositary. SECTION 5.05. Corporate Notices and Reports. The Company agrees that ----------------------------- it will transmit to the Depositary all notices, reports and communications (including without limitation financial statements) required by law, the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are listed or by the Company's Amended and Restated Articles of Incorporation, as amended (including the Articles Supplementary) to be furnished by the Company to holders of the Stock or Receipts. SECTION 5.06. Indemnification by the Company. The Company shall ------------------------------ indemnify the Depositary and any Depositary's Agent against, and hold each of them harmless from, any loss, liability or expense (including the costs and expenses of defending itself) which may arise out of (i) acts performed or omitted in connection with this Deposit Agreement and the Receipts (a) by the Depositary or any Depositary's Agent, except for any liability arising out of the gross negligence or willful misconduct on the respective parts of any such person or persons, or (b) by the Company or any of its agents, or (ii) the offer, sale or registration of the Receipts or the Stock pursuant to the provisions hereof. SECTION 5.07. Charges and Expenses. The Company shall pay all -------------------- transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangements. The Company shall pay all charges of the Depositary in connection with the initial deposit of the Stock and the initial issuance of the Receipts, any redemption of the Stock at the option of the Company and any withdrawals of Stock by holders of Receipts. All other transfer and other taxes and governmental charges shall be at the expense of holders of Depositary Shares. If, at the request of a holder of Receipts, the Depositary incurs charges or expenses for which it is not otherwise liable hereunder, such holder will be liable for such charges and expenses. All other charges and expenses of the Depositary and any Depositary's Agent hereunder (including, in each case, fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be paid by the Company after consultation and agreement between the Depositary and the Company as to the amount and nature of such charges and expenses. The Depositary shall present its statement for charges and expenses to the Company once every three months or at such other intervals as the Company and the Depositary may agree. 17 ARTICLE VI Amendment and Termination ------------------------- SECTION 6.01. Amendment. The form of the Receipts and any provisions --------- of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable; provided, however, that no such amendment which -------- ------- imposes or increases any fees, taxes or charges upon holders of Depositary Shares or Receipts or which materially and adversely alters the existing rights of such holders shall be effective unless such amendment shall have been approved by the record holders of Receipts evidencing at least a majority of the Depositary Shares then outstanding. A holder of a Receipt at the time any such amendment so becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by this Deposit Agreement as amended thereby. Notwithstanding the foregoing, no such amendment may impair the right of any holder of Depositary Shares or Receipts to receive any moneys or other property to which such holder may be entitled under the terms of such Receipts or this Deposit Agreement at the times and in the manner and amount provided for therein and herein. SECTION 6.02. Termination. This Deposit Agreement may be terminated ----------- by the Company or the Depositary only after the occurrence of any of the following events: (i) all outstanding Depositary Shares shall have been redeemed and any accumulated and unpaid dividends on the Stock represented by the Depositary Shares, together with all other moneys and property, if any, to which holders of the related Receipts are entitled under the terms of such Receipts or this Deposit Agreement, have been paid or distributed as provided in this Deposit Agreement or provision therefor has been duly made pursuant to Section 2.03, (ii) there shall have been made a final distribution in respect of the Stock in connection with any liquidation, dissolution or winding up of the Company and such distribution shall have been distributed to the holders of Receipts pursuant to Section 4.01 or 4.02, as applicable or (iii) all outstanding Depositary Shares shall have been converted pursuant to Section 2.04 hereof. Upon the termination of this Deposit Agreement, the Company shall be discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary and any Depositary's Agent under Sections 5.06 and 5.07. 18 ARTICLE VII Miscellaneous ------------- SECTION 7.01. Counterparts. This Deposit Agreement may be executed ------------ in any number of counterparts, and by each of the parties hereto on separate counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same instrument. SECTION 7.02. Exclusive Benefit of Parties. This Deposit Agreement ---------------------------- is for the exclusive benefit of the parties hereto, and their respective successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever. SECTION 7.03. Invalidity of Provisions. In case any one or more of ------------------------ the provisions contained in this Deposit Agreement or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby. SECTION 7.04. Notices. Any and all notices to be given to the ------- Company hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or telegram or telex confirmed by letter, addressed to the Company at 4675 MacArthur Court, Suite 1170, Newport Beach, California 92660, to the attention of R. Bruce Andrews or at any other address of which the Company shall have notified the Depositary in writing. Any and all notices to be given to the Depositary hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or by telegram or telex confirmed by letter, addressed to the Depositary at the Depositary's Office, at __________________, __________, _________________, Attention: _____________________, or at any other address of which the Depositary shall have notified the Company in writing. Any and all notices to be given to any record holder of a Receipt hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or by telegram or telex confirmed by letter, addressed to such record holder at the address of such record holder as it appears on the books of the Depositary, or if such holder shall have filed with the Depositary a written request that notices intended for such holder be mailed to some other address, at the address designated in such request. 19 Delivery of a notice sent by mail or by telegram or telex shall be deemed to be effected at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a telegram or telex message) is deposited, postage prepaid, in a post office letter box. The Depositary or the Company may, however, act upon any telegram or telex message received by it from the other or from any holder of a Receipt, notwithstanding that such telegram or telex message shall not subsequently be confirmed by letter or as aforesaid. SECTION 7.05. Depositary's Agents. The Depositary may from time to ------------------- time, with the prior approval of the Company appoint Depositary's Agents to act in any respect for the Depositary for the purposes of this Deposit Agreement and may at any time appoint additional Depositary's Agents and vary or terminate the appointment of such Depositary's Agents. The Depositary will notify the Company of any such action. SECTION 7.06. Holders of Receipts Are Parties. The holders of ------------------------------- Receipts from time to time shall be parties to this Deposit Agreement and shall be bound by all of the terms and conditions hereof and of the Receipts by acceptance of delivery thereof. SECTION 7.07. Governing Law. THIS DEPOSIT AGREEMENT AND THE RECEIPTS ------------- AND ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. SECTION 7.08. Inspection of Deposit Agreement. Copies of this ------------------------------- Deposit Agreement shall be filed with the Depositary and the Depositary's Agents and shall be open to inspection during business hours at the Depositary's Office and the respective offices of the Depositary's Agents, if any, by any holder of a Receipt. SECTION 7.09. Headings. The headings of articles and sections in -------- this Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereto have been inserted for convenience only and are not to be regarded as a part of this Deposit Agreement or the Receipts or to have any bearing upon the meaning or interpretation of any provision contained herein or in the Receipts. 20 IN WITNESS WHEREOF, the Company and the Depositary have duly executed this Deposit Agreement as of the day and year first above set forth, and all holders of Receipts shall become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms hereof. NATIONWIDE HEALTH PROPERTIES, INC. By: _________________________ _______________________________ By: _________________________ 21 [FORM OF DEPOSIT RECEIPT] [FORM OF FACE] EXHIBIT A DEPOSITARY RECEIPT FOR DEPOSITARY SHARES, EACH REPRESENTING A ___________ INTEREST IN A SHARE OF ___% __________ PREFERRED STOCK ($1.00 Par Value) OF NATIONWIDE HEALTH PROPERTIES, INC. (Incorporated under the Laws of the State of Maryland) This Depositary Receipt is transferable in Los Angeles, California and New York, New York NUMBER DEPOSITARY SHARES THIS CERTIFIES THAT _______________ IS THE REGISTERED OWNER OF DEPOSITARY SHARES ____________, with an office at the time of the execution of the Deposit Agreement (as defined below) at _______________________ _______________________________, as Depositary and Registrar (the "Depositary"), hereby certifies that the registered owner specified above is the registered owner of Depositary Shares ("Depositary Shares"), each Depositary Share representing a _________ interest in a share of ___% __________ Preferred Stock, $1.00 par value (the "Stock"), of Nationwide Health Properties, Inc., a corporation duly organized and existing under the laws of the State of Maryland (the "Company"), on deposit with the Depositary, subject to the terms and entitled to the benefits of the Deposit Agreement (the "Deposit Agreement") dated as of ______, 199_ between the Company, the Depositary and all holders from time to time of Depositary Receipts (the "Receipts"). By accepting this Receipt the holder hereof becomes a party to and agrees to be bound by all the terms and conditions of the Deposit Agreement. A-1 Subject to the terms of the Deposit Agreement, each owner of a Depositary Share is entitled, proportionately, through the Depositary, to all the rights and preferences of the Stock relating thereto, including dividend, voting, conversion, redemption and liquidation rights contained in the Articles Supplementary adopted by the Company's Board of Directors setting forth the number, terms, powers, designations, rights, preferences, qualifications, restrictions and limitations of the Stock (the "Articles Supplementary"), copies of which are on file at the Depositary's Office. This receipt shall not be entitled to any benefits under the Deposit Agreement or be valid or obligatory for any purpose, unless this Receipt shall have been executed by the manual signature of a duly authorized officer of the Depositary. Dated: ________________________________ Depositary and Registrar By______________________________ Authorized Officer [FORM OF REVERSE] 1. The Deposit Agreement. The Receipts, of which this Receipt is --------------------- one, are made available upon the terms and conditions set forth in the Deposit Agreement. The Deposit Agreement (copies of which are on file at the Depositary's Office) sets forth the rights of holders of Receipts and the rights and duties of the Depositary and the Company in respect of the Stock deposited, and any and all other property and cash deposited from time to time, thereunder. The statements made on the face and the reverse of this Receipt are summaries of certain provisions of the Deposit Agreement and are subject to the detailed provisions thereof, to which reference is hereby made. Unless otherwise expressly herein provided, all defined terms used herein shall have the meanings ascribed thereto in the Deposit Agreement. 2. Redemption. Whenever the Company shall elect, in accordance with ---------- the provisions of the Articles Supplementary relating to the Stock, to redeem shares of the Stock, it shall (unless otherwise agreed in writing with the Depositary) mail notice to the Depositary of such redemption not less than 30 nor more than 60 days prior to the date fixed for redemption. The Depositary shall mail notice of such redemption and the A-2 simultaneous redemption of the number of Depositary Shares relating to the Stock to be redeemed not less than 30 and not more than 60 days prior to the date fixed for redemption to the holders of record of Receipts evidencing the number of Depositary Shares to be redeemed. Each such notice shall state: (a) the date of such proposed redemption; (b) the number of Depositary Shares to be redeemed; (c) the redemption price (which shall include full cumulative dividends thereon to the redemption date); (d) the place or places where Receipts evidencing Depositary Shares are to be surrendered for payment of the redemption price; (e) that dividends in respect of the Stock underlying the Depositary Shares to be redeemed will cease to accumulate at the close of business on such redemption date; and (f) that the right to convert Depositary Shares into shares of Common Stock, if applicable, will expire at the close of business on the _____ day preceding the redemption date; the then-effective conversion price and the place or places where Receipts for such Depositary Shares are to be surrendered for conversion. In case less than all the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be so redeemed shall be selected by lot or pro rata (subject to rounding to avoid fractions of Depositary Shares) as may be determined by the Depositary to be equitable. From and after the date set for redemption, all dividends in respect of the Depositary Shares so called for redemption shall cease to accumulate, such Depositary Shares shall no longer be deemed outstanding and all remaining rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive the redemption price and to convert Depositary Shares into Common Stock until the close of business on the _______ day preceding the redemption date) shall cease and terminate. From and after the redemption date, upon surrender in accordance with the redemption notice of the Receipts evidencing any such Depositary Shares (properly endorsed or assigned for transfer, if the Depositary shall so require), such Depositary Shares shall be redeemed by the Depositary at a redemption price per share equal to ___________ of the redemption price per share paid in respect of the shares of Stock plus any money or other property relating thereto. 3. Transfer, Split-ups and Combinations. This Receipt is ------------------------------------ transferable on the books of the Depositary upon surrender of this Receipt to the Depositary, properly endorsed or accompanied by a properly executed instrument of transfer, and upon such transfer the Depositary shall execute a new Receipt to or upon the order of the person entitled thereto, as provided in the Deposit Agreement. This Receipt may be split into other Receipts or combined with other Receipts into one Receipt, representing the same aggregate number of Depositary Shares as the Receipt or Receipts surrendered. A-3 4. Surrender of Receipts and Withdrawal of Stock, Conversion of ------------------------------------------------------------ Stock. Any holder of a Receipt or Receipts evidencing at least ______ - ----- Depositary Shares may withdraw the number of whole shares of Stock underlying such Depositary Shares and all money and other property relating thereto by surrendering Receipts evidencing such Depositary Shares. Thereafter, the Depositary shall deliver to such holder the number of whole shares of Stock and all money and other property underlying the Depositary Shares evidenced by the Receipts so surrendered, but holders of such whole shares of Stock will not thereafter be entitled to deposit such Stock under the Deposit Agreement or to receive Receipts evidencing Depositary Shares therefor. If a Receipt delivered by a holder to the Depositary in connection with such withdrawal shall evidence a number of Depositary Shares relating to other than a whole number of shares of Stock, the Depositary shall at the same time, in addition to such number of whole shares of Stock and such money and other property to be so withdrawn, deliver to such holder a new Receipt evidencing such excess number of Depositary Shares. Delivery of the Stock and money and other property being withdrawn may be made by delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate. If the Stock and the money and other property being withdrawn are to be delivered to a person other than the record holder of the Depositary Shares evidenced by the Receipts being surrendered, such holder shall deliver a written order so directing the Depositary. The Depositary may require that Receipts surrendered for withdrawal of Stock be properly endorsed in blank or accompanied by a properly executed instrument of transfer. Delivery of the Stock and the money and other property underlying the Depositary Shares evidenced by the Receipts surrendered for withdrawal shall be made by the Depositary at the Depositary's Office, except that, at the request, risk and expense of the holder surrendering such Receipts and for the account of such holder, such delivery may be made at such other place as may be designated by such holder. THE HOLDER HEREOF ACKNOWLEDGES THAT THERE WILL BE NO MARKET FOR THE UNDERLYING STOCK AND THAT UPON WITHDRAWAL OF THE STOCK, THE HOLDER HEREOF WILL NOT BE ENTITLED THEREAFTER TO DEPOSIT SUCH STOCK UNDER THE DEPOSIT AGREEMENT. The Stock and Depositary Shares [are convertible into] the Common Stock. The Company has agreed in Section 2.04 of the Deposit Agreement to accept the delivery of Receipts for purposes of effecting conversions of the Stock utilizing the same procedures as those provided for delivery of certificates for the Stock to effect such conversions in accordance with the terms and conditions of the Stock as provided in the Articles Supplementary. Any whole number of Depositary Shares (whether or A-4 not evenly divisible by _____) represented by a Receipt may be surrendered for conversion. If the Depositary Shares represented by a Receipt are to be converted in part only, a new Receipt or Receipts will be issued by the Depositary for the Depositary Shares not to be converted. No fractional shares of Common Stock will be issued upon conversion, and if such conversion will result in a fractional share being issued, an amount will be paid in cash by the Company equal to the value of the fractional interest based upon the closing price of the Common Stock on the last business day prior to the conversion. For this purpose, a holder of a Receipt or Receipts must surrender such Receipt or Receipts to the Company, together with a duly completed and executed Notice of Conversion in the form included herein. In all cases the foregoing shall be conditioned upon compliance in full by the holder hereof with the terms and conditions of the Stock as provided in the Articles Supplementary and the Deposit Agreement. As more fully set forth in Section 2.04 of the Deposit Agreement, no adjustments will be made for accrued dividends upon conversion. 5. Suspension of Delivery, Transfer, etc. The transfer or surrender ------------------------------------- of this Receipt may be suspended during any period when the register of stockholders of the Company is closed or if any such action is deemed necessary, or advisable by the Depositary, any Depositary's Agent, or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, or under any provision of the Deposit Agreement. 6. Filing Proofs, Certificates and Other Information. Any holder of ------------------------------------------------- a Depositary Receipt may be required to file such proof of residence, or other matters or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper. The Depositary or the Company may withhold the delivery, or delay the registration of transfer, redemption, exchange or conversion, of any Receipts, the withdrawal of any Stock underlying Depositary Shares or the distribution of any dividend or other distribution or the sale of any rights or of the proceeds thereof until such proof or other information is filed or such certificates are executed or such representations and warranties are made. 7. Payment of Taxes or Other Governmental Charges. Except as ---------------------------------------------- otherwise noted herein and in the Deposit Agreement, if any tax or other governmental charge shall become payable by or on behalf of the Depositary with respect to this Receipt, such tax (including transfer taxes, if any) or governmental charge shall be payable by the holder hereof. Transfer of this Receipt, any withdrawal of Stock and delivery of all money or other property, if any, represented by the Depositary Shares evidenced by this Receipt may be refused until such payment is made, and any dividends, interest payments or other distributions may be A-5 withheld on all or any part of the Stock or other property relating to this Receipt and not theretofore sold may be sold for the account of the holder hereof (after attempting by reasonable means to notify such holder prior to such sale), and such dividends, interest payments or other distributions or the proceeds of any such sale may be applied to any payment of such tax or charge, the holder of this Receipt remaining liable for any deficiency. 8. Warranty by Company. The Company has warranted that the Stock and ------------------- the Common Stock issuable upon conversion of the Depositary Shares, when issued, will be validly issued, fully paid and nonassessable. 9. Amendment. The form of the Receipts and any provisions of the --------- Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable; provided, however, that no such amendment which imposes or increases any fees, taxes or charges upon holders of Depositary Shares or Receipts or which materially and adversely alters the existing rights of such holders shall be effective unless such amendment shall have been approved by the record holders of Receipts evidencing at least a majority of the Depositary Shares then outstanding. Notwithstanding the foregoing, no such amendment may impair the right of any holder of Depositary Shares or Receipts to receive any moneys or other property to which such holder may be entitled under the terms of such Receipts or the Deposit Agreement at the times and in the manner and amount provided for therein. A holder of a Receipt at the time any such amendment so becomes effective shall be deemed, by continuing to hold such Receipt, to consent and agree to such amendment and to be bound by the Deposit Agreement as amended thereby. 10. Charges of Depositary. The Company will pay all transfer and --------------------- other taxes and governmental charges arising solely from the existence of the depositary arrangements, and all charges of the Depositary in connection with the initial deposit of the Stock and the initial issuance of the Receipts, any redemption of the Stock at the option of the Company and any withdrawals of Stock by holders of the Receipts. All other transfer and other taxes and other governmental charges shall be at the expense of holders of Depositary Shares. Certain other charges and expenses of the Depositary and any Depositary's Agent will be paid upon consultation and agreement between the Depositary and the Company. 11. Title to Receipts. This Receipt (and the Depositary Shares ----------------- evidenced hereby), when properly endorsed or accompanied by a properly executed instrument of transfer, is transferable by delivery with the same effect as in the case of a negotiable instrument; provided, however, that until transfer of -------- ------- a Receipt shall be registered on the books of the Depositary, the Depositary may, notwithstanding any notice to the contrary, treat the record holder of such Receipt at such time as the absolute owner thereof for the purpose of determining the person entitled to receive distributions of dividends or other distributions, withdraw any Stock underlying the Depositary Shares, exercise any conversion rights or to receive any notice provided for in the Deposit Agreement and for all other purposes. 12. Dividends and Distributions. Whenever the Depositary receives --------------------------- any cash dividend or other cash distribution on the Stock, the Depositary will, subject to the provisions of the Deposit Agreement, make such distribution to the Receipt holders as nearly as practicable in proportion to the number of Depositary Shares evidenced by the Receipts held by them; provided, however, -------- ------- that the amount distributed will be reduced by any amounts required to be withheld by the Company or the Depositary on account of taxes and governmental charges. Other distributions received on the Stock may be distributed to holders of Receipts as provided in the Deposit Agreement. 13. Fixing of Record Date. Whenever any cash dividend or other cash --------------------- distribution shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered, with respect to Stock, or whenever the Depositary shall receive notice of any meeting or action to be taken by written consent at or as to which holders of Stock are entitled to vote or consent, or of which holders of Stock are entitled to notice, the Depositary shall in each instance fix a record date (which shall be the record date fixed by the Company with respect to the Stock), for the determination of the holders of Receipts who shall be entitled to receive such dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of rights to vote or consent at any such meeting, or who shall be entitled to notice of such meeting or action. 14. Voting Rights. Upon receipt of notice of any meeting or action ------------- to be taken by written consent at or as to which holders of Stock are entitled to vote or consent, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts a notice which shall contain (i) such information as is contained in such notice of meeting or action and (ii) a statement informing holders of Receipts that they may instruct the Depositary as to the exercise of the voting rights or the giving or refusal of consent, as the case may be, pertaining to the amount of Stock underlying their respective Depositary Shares and a brief statement as to the manner in which such instructions may be given. Upon the written request of a holder of a Receipt on the record date (which will be the same date as the record date for the Stock), the Depositary shall endeavor insofar as practicable to vote or cause to be voted or give or withhold consent with respect to, the amount of Stock underlying such Receipt in accordance with the instructions set forth in such request. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting or giving consents (but, at its discretion, not from appearing at any meeting with respect to such Stock unless directed to the contrary by the holders of a majority of Receipts) to the extent of the Stock underlying the Depositary Shares evidenced by such Receipt. 15. Changes Affecting Deposited Stock. Upon any change in par or --------------------------------- stated value, split-up, combination or any other reclassification of the Stock or upon any recapitalization, reorganization, merger, amalgamation or consolidation affecting the Company or to which it is a party, or upon the sale of all or substantially all the Company's assets, the Depositary may in its discretion with the approval of, and shall upon the instructions of, the Company, and in such manner as the Depositary may deem equitable, (i) make such adjustments in (a) the fraction of an interest in one share of Stock underlying one Depositary Share and (b) the ratio of the redemption price per Depositary Share to the redemption price of a share of Stock, in each case as may be necessary fully to reflect the effect of such change and (ii) treat any securities which shall be received by the Depositary in exchange for or upon conversion of or in respect of the Stock as new deposited securities so received in exchange for or upon conversion of or in respect of such Stock. In any such case the Depositary may in its discretion, with the approval of the Company, execute and deliver additional Receipts, or may call for the surrender of outstanding Receipts to be exchanged for new Receipts specifically describing such new deposited securities. 16. Liability and Obligations of the Depositary, the Depositary's ------------------------------------------------------------- Agents or the Company. Neither the Depositary nor any Depositary's Agent nor - --------------------- the Company assumes any obligation or shall be subject to any liability under the Deposit Agreement to any holder of any Receipt, other than for its gross negligence or willful misconduct. Neither the Depositary nor any Depositary's Agent nor the Company shall incur any liability to any holder of any Receipt if by reason of any provision of any present or future law or regulation thereunder of the United States of America or any other governmental authority or, in the case of the Depositary or any Depositary's Agent, by reason of any provision, present or future, of the Company's Amended and Restated Articles of Incorporation, (including the Articles Supplementary) or by reason of any act of God or war or other circumstance beyond their control, the Depositary, any Depositary's Agent or the Company shall be prevented or forbidden from doing or performing any act or thing which the terms of the Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary's Agent or the Company incur any liability to any holder of a Receipt by reason of nonperformance or delay, caused as aforesaid, in performance of any act or thing which by the terms of the Deposit Agreement it is provided shall or may be done or performed, or by reason of any exercise of, or failure to exercise, any discretion provided for in the Deposit Agreement, other than for its gross negligence or willful misconduct. Neither the Depositary nor any Depositary's Agent nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of the Stock, the Depositary Shares or the Receipts, which in its opinion may involve it in expense or liability, unless indemnity satisfactory to it against all expense and liability be furnished. The Deposit Agreement contains various other exculpatory, indemnification and related provisions, to which reference is hereby made. 17. Resignation and Removal of Depositary. The Depositary may at any ------------------------------------- time (i) resign by written notice of its election to do so delivered to the Company, such resignation to take effect upon the appointment of a successor Depositary and its acceptance of such appointment, or (ii) be removed by the Company effective upon the appointment of a successor Depositary and its acceptance of such appointment. 18. Termination of Deposit Agreement. The Deposit Agreement may be -------------------------------- terminated by the Company or the Depositary only after the occurrence of any of the following events: (i) all outstanding Depositary Shares shall have been redeemed and any accumulated and unpaid dividends on the Stock represented by the Depositary Shares, together with all other moneys and property, if any, to which holders of the related Receipts are entitled under the terms of such Receipts or the Deposit Agreement, have been paid or distributed as provided in the Deposit Agreement or provision therefor has been duly made or (ii) there shall have been made a final distribution in respect of the Stock in connection with any liquidation, dissolution or winding up of the Company and such distribution shall have been distributed to the holders of the Receipts or (iii) all outstanding Depositary Shares shall have been converted. Upon the termination of the Deposit Agreement, the Company shall be discharged from all obligations thereunder except for its obligations to the Depositary with respect to indemnification, charges and expenses. 19. Governing Law. THIS RECEIPT AND THE DEPOSIT AGREEMENT AND ALL ------------- RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK. THE DEPOSITARY IS NOT RESPONSIBLE FOR THE VALIDITY OF ANY DEPOSITED STOCK. THE DEPOSITARY ASSUMES NO RESPONSIBILITY FOR THE CORRECTNESS OF THE FOREGOING DESCRIPTION WHICH CAN BE TAKEN AS A STATEMENT OF THE COMPANY SUMMARIZING CERTAIN PROVISIONS OF THE DEPOSIT AGREEMENT WHICH APPEARS IN THE RECEIPTS. THE DEPOSITARY MAKES NO WARRANTIES OR REPRESENTATIONS AS TO THE VALIDITY, GENUINENESS OR SUFFICIENCY OF ANY STOCK AT ANY TIME DEPOSITED WITH THE DEPOSITARY HEREUNDER OR OF THE DEPOSITARY SHARES, AS TO THE VALIDITY OR SUFFICIENCY OF THE DEPOSIT AGREEMENT, AS TO THE VALUE OF THE DEPOSITARY SHARES OR AS TO ANY RIGHT, TITLE OR INTEREST OF THE RECORD HOLDERS OF THE RECEIPTS TO THE DEPOSITARY SHARES. THE COMPANY WILL FURNISH WITHOUT CHARGE TO EACH RECEIPT HOLDER WHO SO REQUESTS A COPY OF THE DEPOSIT AGREEMENT AND A STATEMENT OR SUMMARY OF THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF WHICH THE COMPANY IS AUTHORIZED TO ISSUE AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. ANY SUCH REQUEST IS TO BE ADDRESSED TO THE SECRETARY OF THE COMPANY. The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations: TEN COM - as tenants in common TEN ENT - as tenants by the entireties JT TEN - as joint tenants with right of survivorship and not as tenants in common UNIF GIFT MIN ACT - ________ Custodian _________ (Cust) (Minor) under the Uniform Gifts to Minors Act _______ (State) Additional abbreviations may also be used though not in the above list. For value received, ________________ hereby sell(s), assign(s) and transfer(s) unto ________________________________________ (Please insert social security or other identifying number of Assignee) ____________________________________________________________ (Please print or typewrite Name and address including postal zip code of Assignee) __________ Depositary Shares represented by the within Receipt and all rights thereunder, and do hereby irrevocably constitute and appoint _____________ Attorney to transfer said Depositary Shares on the books of the within-named Depositary with full power of substitution in the premises. Dated: _______________ _________________________________ NOTICE. The signature(s) to this assignment must correspond with the name(s) as written upon the face of this instrument in every particular, without alteration or enlargement or any change whatever. SIGNATURE(S) GUARANTEED By: _________________________ NOTICE OF CONVERSION The undersigned holder of this Receipt for Depositary Shares (the "Depositary Shares") hereby irrevocably exercises the option to convert _______ Depositary Shares evidenced thereby into shares of Common Stock (and any other applicable securities or property) of the Company in accordance with the terms and conditions of the Deposit Agreement, dated as of _______, 199_, among the Company, ___________________________, as Depositary, and the holders from time to time of Receipts referred to in such Deposit Agreement, and directs that certificates for the securities deliverable upon such conversion be registered in the name of and delivered, together with a check in payment for any fractional shares and any other property deliverable upon which conversion to the undersigned unless a different name has been indicated below. If securities are to be registered in the name of a person other than the undersigned, the undersigned will pay all transfer taxes payable with respect thereto. If the number of Depositary Shares indicated above is less than the number of Depositary Shares evidenced by this Receipt, the undersigned directs the Depositary to issue to the undersigned, unless a different name is indicated below, a new Receipt evidencing the Depositary Shares not so converted. Dated: __________________ Signature ------------------------------ NOTE: The signature(s) to this assignment must correspond with the name(s) as written upon the face of the Receipt in every particular, without alteration or enlargement, or any change whatever. (Please print name and address of registered holder) Name _______________________________________________________ Taxpayer Identification Number _____________________________ Address ____________________________________________________ (Please indicate other delivery instructions, if applicable) Name _______________________________________________________ Address ____________________________________________________ EX-5.1 4 OPINION OF O'MELVENY & MYERS LLP RE VALIDITY EXHIBIT 5.1 [LETTERHEAD OF O'MELVENY & MYERS LLP] November 27th 1 9 9 6 Nationwide Health Properties, Inc. 4675 MacArthur Court Suite 1170 Newport Beach, California 92660 Re: $300,000,000 Aggregate Offering Price of Securities of Nationwide Health Properties, Inc. ------------------------------------------------ Gentlemen: At your request, we have examined the Registration Statement on Form S-3 (the "Registration Statement") to be filed by Nationwide Health Properties, Inc. (the "Company") with the Securities and Exchange Commission in connection with the registration of $300,000,000 aggregate offering price of securities (the "Securities"), consisting of one or more series of unsecured debt securities (the "Debt Securities"), warrants to purchase Debt Securities (the "Debt Securities Warrants"), one or more series of shares of preferred stock, par value $1.00 per share (the "Preferred Stock"), warrants to purchase Preferred Stock (the "Preferred Stock Warrants"), depositary shares representing interests in the Preferred Stock (the "Depositary Shares"), warrants to purchase Depositary Shares (the "Depositary Shares Warrants"), shares of common stock, par value $.10 per share (the "Common Stock"), and warrants to purchase Common Stock (the "Common Stock Warrants," and with the Debt Securities Warrants, the Preferred Stock Warrants and the Depositary Shares Warrants, being collectively referred to herein as the "Securities Warrants"). We also have examined the form of Indenture to be entered into by and between the Company and Bank of New York, as Trustee, relating to the Debt Securities (the "Indenture"). We are familiar with the proceedings heretofore Page 2 - Nationwide Health Properties, Inc. - November 27, 1996 taken and proposed to be taken by the Company in connection with the authorization, registration, issuance and sale of the Securities. Subject to (i) the proposed additional proceedings being taken as now contemplated by us as your counsel prior to the issuance and sale of the Securities; (ii) the effectiveness of the Registration Statement under the Securities Act of 1933, as amended; (iii) the establishment of the terms of the Debt Securities in accordance with the terms of the Indenture; (iv) the establishment of the terms of the Preferred Stock, if applicable, in accordance with the terms of the Company's Amended and Restated Articles of Incorporation and applicable law; (v) the due authorization, execution and delivery of a Deposit Agreement (in the case of Depositary Shares) and Warrant Agreement (in the case of Securities Warrants); and (vi) the execution, delivery and authentication of and payment for the Securities, it is our opinion that: 1. The Debt Securities, including any Debt Securities that may be issued upon the exercise of any Debt Securities Warrants, will, upon the issuance and sale thereof in the manner referred to in the Registration Statement, constitute legally valid and binding obligations of the Company, enforceable against the Company in accordance with their terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or affecting creditors' rights generally (including, without limitation, fraudulent conveyance laws) and by general principles of equity including, without limitation, concepts of materiality, reasonableness, good faith and fair dealing and the possible unavailability of specific performance or injunctive relief, regardless of whether considered in a proceeding in equity or at law. 2. The Preferred Stock, including any Preferred Stock that may be issued upon the exercise of any Preferred Stock Warrants will, upon the issuance and sale thereof in the manner referred to in the Registration Statement, be validly issued, fully paid and nonassessable. 3. The persons in whose names the Depositary Shares represented by depositary receipts are registered will be entitled to the rights specified in the Deposit Agreement. 4. The Common Stock, including any Common Stock that may be issuable pursuant to the conversion of any Debt Securities or Preferred Stock, or upon exercise of any Common Stock Warrants, will, upon the issuance and sale Page 3 - Nationwide Health Properties, Inc. - November 27, 1996 thereof in the manner specified in the Registration Statement, be validly issued, fully paid and nonassessable. 5. The Securities Warrants will, upon the issuance and sale thereof in the manner specified in the Registration Statement, be validly issued, fully paid and nonassessable. We consent to the filing of this opinion as an exhibit to the Registration Statement. Respectfully submitted, /s/ O'MELVENY & MYERS LLP EX-8.1 5 OPINION OF O'MELVENY & MYERS RE TAX MATTERS EXHIBIT 8.1 [LETTERHEAD OF O'MELVENY & MEYERS LLP] November 27th 1 9 9 6 OUR FILE NUMBER 614,055-088 NB1-289101.V1 Nationwide Health Properties, Inc. 4675 MacArthur Court, Suite 1170 Newport Beach, California 92660 Re: Nationwide Health Properties, Inc. - Form S-3 Registration Statement ------------------------------------ Gentlemen: In connection with the above Registration Statement regarding the proposed issuance and sale of the Securities of Nationwide Health Properties, Inc., a Maryland corporation (the "Company"), you have requested our opinion whether the Company qualified as a real estate investment trust (a "REIT") under sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Code"), for its taxable year ended December 31, 1995 and whether it will continue to so qualify if it operates subsequent to September 30, 1996 in the same manner as it has prior to that date. You have also asked our opinion whether the Company should be treated as the owner of its properties listed in the schedule which you provided to us (the "Properties") for federal income tax purposes and whether the leases with respect to such Properties (the "Leases") should be treated as true leases, and not financing arrangements, for such purposes. All capitalized terms in this opinion and not otherwise defined herein shall have the same respective meanings as set forth in the Registration Statement. As of June 18, 1996, we delivered our opinion (the "6/18/96 Opinion") concerning the qualification of the Company as a REIT for its taxable year ended December 31, 1995 and its continuing qualifications as a REIT if it operated subsequent to Page 2 - Nationwide Health Properties, Inc. - November 27, 1996 March 31, 1996 in the same manner as it had prior to that date. The 6/18/96 Opinion, and the certificates, documents and other materials referred to therein, are hereby incorporated by reference. Since June 18, 1996, there have been delivered to us certain certificates and schedules prepared and executed by Company personnel, setting forth certain factual representations regarding the Company and its assets and operations. This opinion specifically relies on such documents, certificates and schedules and assumes that the facts represented therein will not change in any material way so long as the Company seeks to qualify as a REIT. On the basis of the foregoing and subject to all of the qualifications, conditions and factual assumptions set forth herein and in the 6/18/96 Opinion, we are of the opinion that for the calendar year 1995, the Company met each of the requirements for qualification as a REIT, and if the Company operates subsequent to September 30, 1996 in the same manner as it has prior to such date, it will continue to so qualify, provided that the various tests for qualification as a REIT relating to its income, assets, distributions, ownership and certain administrative matters are satisfied in those years. However, we are unable to opine whether the Company will actually continue to qualify as a REIT because such qualification will depend on future transactions and events which cannot be known at this time. We also wish to advise you that on the basis of and in reliance on the foregoing and on the facts set forth in the Registration Statement, it is the opinion of O'Melveny & Myers LLP that under current law, including relevant statutes, regulations, and judicial and administrative precedent (which law is subject to change on a retroactive basis), a court, more likely than not, would hold that the Company would be treated as the owner of the Properties for federal income tax purposes and the Leases would be treated as true leases, and not financing arrangements, for such purposes. You should be aware that this opinion is not binding on the Internal Revenue Service and no assurance can be given that the Internal Revenue Service may not successfully challenge the conclusions set forth in this opinion. If the Internal Revenue Service successfully challenged such conclusions, the Company would not be entitled to claim depreciation with respect to the Properties and might be compelled to make deficiency dividends to satisfy the 95% dividend distribution requirement or lose its REIT status. Respectfully submitted, /s/ O'MELVENY & MYERS LLP EX-12 6 COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES EXHIBIT 12 ---------- NATIONWIDE HEALTH PROPERTIES, INC. STATEMENT REGARDING COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES (in thousands, except ratios)
Nine months Year ended December 31, ended ----------------------------------------------- September 30, 1991 1992 1993 1994 1995 1996 ------- ------- ------- ------- ------- ------------- Ratio 5.44 4.84 7.63 5.52 4.44 3.58 Pretax income from continuing operations $21,541 $29,681 $40,996 $44,513 $50,371 $40,043 Interest 4,849 8,162 6,186 9,921 14,628 15,539 ------- ------- ------- ------- ------- ------- "Earnings" $26,390 $37,843 $47,162 $54,734 $64,999 $55,582 ======= ======= ======= ======= ======= ======= "Fixed charges" $ 4,849 $ 8,162 $ 6,186 $ 9,921 $14,628 $15,539 ======= ======= ======= ======= ======= =======
EX-25 7 FORM T-1/BANK OF NEW YORK AS TRUSTEE EXHIBIT 25 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 _______________________ FORM T-1 STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO SECTION 305(b)(2) ____________ ______________________ THE BANK OF NEW YORK (Exact name of trustee as specified in its charter) New York 13-5160382 (Jurisdiction of incorporation (I.R.S. employer if not a U.S. national bank) identification no.) 48 Wall Street, New York, New York 10286 (Address of principal executive offices) (Zip Code) NATIONWIDE HEALTH PROPERTIES, INC. (Exact name of obligor as specified in its charter) Maryland 95-3997619 (State or other jurisdiction of (I.R.S. employer incorporation or organization) identification no.) 4675 MacArthur Court, Suite 1170 Newport Beach, California 92660 (Address of principal executive offices) (Zip Code) _________________________ Debt Securities (Title of the indenture securities) GENERAL ITEM 1. General Information. Furnish the following information as to the Trustee: (a) Name and address of each examining or supervising authority to which it is subject. Superintendent of Banks of the State of 2 Rector Street, New York, N.Y. 10006, New York and Albany, N.Y. 12203 Federal Reserve Bank of New York 33 Liberty Plaza, New York, N.Y. 10045 Federal Deposit Insurance Corporation Washington, D.C. 20549 New York Clearing House Association New York, N.Y.
(b) Whether it is authorized to exercise corporate trust powers: Yes. ITEM 2. Affiliations with Obligor If the obligor is an affiliate of the trustee, describe each such affiliation. None. (See Note on page 2.) _____________________________ ITEM 16. List of Exhibits: Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a- 29 under the Trust Indenture Act of 1939 (the "Act") and Rule 24 of the Commission's Rules of Practice. 1. - A copy of the Organization Certificate of The Bank of New York (formerly Irving Trust Company) as now in effect, which contains the authority to commence business and a grant of powers to exercise corporate trust powers. (See Exhibit 1 to Amendment No. 1 to Form T-1 filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1 to Form T-1 filed with Registration Statement No. 33-29637.) 4. - A copy of the existing By-laws of the Trustee. (See Exhibit 4 to Form T-1 filed with Registration Statement No. 33-31019.) 6. - The consent of the Trustee required by Section 321(b) of the Act. (See Exhibit 6 to Form T-1, Registration Statement No. 33-44051.) 7. - A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority. (See Exhibit 7 to Form T-1, Registration Statement No. 33-55379.) 1 NOTE ---- Inasmuch as this Form T-1 is filed prior to the ascertainment by the Trustee of all facts on which to base responsive answer to Item 2, the answer to said Item is based on incomplete information. Item 2 may, however, be considered as correct unless amended by an amendment to this Form T-1. __________________________ SIGNATURE Pursuant to the requirements of the Act, the Trustee, The Bank of New York, a corporation organized and existing under the laws of the State of New York, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of New York, and State of New York, on the 18th day of November, 1996. The Bank of New York By: Byron Merino --------------------- Byron Merino Assistant Treasurer 2 Consolidated Report of Condition of THE BANK OF NEW YORK of 48 Wall Street, New York, N.Y. 10266 And Foreign and Domestic Subsidiaries, a member of the Federal Reserve System, at the close of business June 30, 1996, published in accordance with a call made by the Federal Reserve Bank of this District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts ASSETS in Thousands Cash and balances due from depository institutions: Noninterest-bearing balances and currency and coin............................... $ 3,650,068 Interest-bearing balances......................... 738,260 Securities: Held-to-maturity securities....................... 784,969 Available-for-sale securities..................... 2,033,407 Federal funds sold and securities purchased under agreements to resell in domestic offices of the bank: Federal funds sold................................ 3,699,232 Securities purchased under agreements to resell.............................. 20,000 Loans and lease financing receivables: Loans and leases, net of unearned Income.............. 28,109,045 LESS: Allowance for loan and lease losses........... 586,658 LESS: Allocated transfer risk reserve.................... 429 Loans and leases, net of unearned income, allowance, and reserve.................. 27,521,958 Assets held in trading accounts..................... 678,844 Premises and fixed assets (including capitalized leases)............................... 608,217 Other real estate owned............................. 50,599 Investments in unconsolidated subsidiaries and associated companies.......................... 235,670 Customers' liability to this bank on acceptances outstanding........................... 904,948 Intangible assets................................... 450,230 Other assets........................................ 1,299,464 ----------- Total assets........................................ $42,675,866 =========== LIABILITIES Deposits: In domestic offices............................... $19,223,050 Noninterest-bearing..... 7,675,758 Interest-bearing....... 11,547,292 In foreign offices, Edge and Agreement subsidiaries, and IBFs 11,527,685 Noninterest-bearing........ 48,502 Interest-bearing....... 11,479,183 Federal funds purchased and securities sold under agreements to repurchase in domestic offices of the bank and of its Edge and Agreement subsidiaries, and in IBFs: Federal funds purchased........................... 1,498,351 Securities sold under agreements to repurchase................................... 126,974 Demand notes issued to the U.S. Treasury........................................ 231,865 Trading liabilities............................... 479,390 Other borrowed money: With original maturity of one year or less....................................... 2,521,578 With original maturity of more than one year...................................... 20,780 Bank's liability on acceptances executed and outstanding................................. 905,850 Subordinated notes and debentures................. 1,020,400 Other liabilities................................. 1,543,657 ---------- Total liabilities................................. 39,099,580 ========== EQUITY CAPITAL Common stock...................................... 942,284 Surplus........................................... 525,666 Undivided profits and capital reserves........................................ 2,124,231 Net unrealized holding gains (losses) on available-for-sale securities...................................... ( 8,063) Cumulative foreign currency translation adjustments..................................... ( 7,832) ----------- Total equity capital.............................. 3,576,286 ----------- Total liabilities and equity capital.............. $42,675,866 ===========
I, Robert E. Keilman, Senior Vice President and Comptroller of the above-named bank do hereby declare that this Report of Condition has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true to the best of my knowledge and belief. Robert E. Keilman We, the undersigned directors, attest to the correctness of this Report of Condition and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the Board of Governors of the Federal Reserve System and is true and correct. J. Carter Bacot ) Alan R. Griffith } Directors Thomas A. Renyi ) -----END PRIVACY-ENHANCED MESSAGE-----