Document:

Exhibit 4.1

 

 

First Supplemental Indenture

 

Dated as of January 24, 2011

 

Supplement to the Indenture

Dated as of September 1, 1993

 

 

HCP, INC.,

Issuer

 

and

 

THE BANK OF NEW YORK MELLON

TRUST COMPANY, N.A.,

Trustee

 

 

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE I
    	
 
    	
DEFINITIONS
    	
 
    	
1
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
ARTICLE II
    	
 
    	
EVENTS   OF DEFAULT
    	
 
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
SECTION 201
    	
Section 501(5) of   the Base Indenture
    	
 
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE III
    	
 
    	
COVENANTS
    	
 
    	
5
    
	
 
    	
 
    	
 
    	
 
    
	
SECTION 301
    	
Section 1008   of the Base Indenture
    	
 
    	
5
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
SECTION 302
    	
Section 1010   of the Base Indenture
    	
 
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
ARTICLE IV
    	
 
    	
MISCELLANEOUS
    	
 
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
SECTION 401
    	
Application   of Supplemental Indenture
    	
 
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
SECTION 402
    	
Effective   Date of Supplemental Indenture
    	
 
    	
7
    
	
 
    	
 
    	
 
    	
 
    
	
SECTION 403
    	
Counterparts
    	
 
    	
7
    
						

 

i

 

FIRST SUPPLEMENTAL INDENTURE, dated as of January 24, 2011 (this “Supplemental Indenture”), by and between HCP, Inc. (formerly known as Health Care Property Investors, Inc.), a corporation duly organized and existing under the laws of the State of Maryland (the “Company”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as successor trustee to The Bank of New York,  a national banking association organized and existing under the laws of the United States of America, as Trustee under the Indenture (as hereinafter defined) (the “Trustee”).

 

RECITALS OF THE COMPANY

 

A.            The Company and the Trustee are parties to that certain Indenture, dated as of September 1, 1993 (the “Base Indenture”), as supplemented by this Supplemental Indenture (together with the Base Indenture, the “Indenture”).

 

B.            Under Section 901 of the Base Indenture, the Company and the Trustee are authorized to enter into one or more indentures supplemental to the Base Indenture, without the consent of the Holders of Securities, in order to change or eliminate any provisions in the Base Indenture with respect to all or any series of the Securities not then outstanding, provided that such supplemental indenture has been authorized by a Board Resolution.

 

C.            The execution and delivery of this Supplemental Indenture has been authorized by a Board Resolution.

 

D.            Concurrent with the execution hereof, the Company has caused its counsel to deliver to the Trustee an Opinion of Counsel pursuant to Sections 102 and 903 of the Base Indenture, together with the documents, including an Officers’ Certificate, required under Section 102 of the Base Indenture.

 

E.             The Company has done all things necessary to make this Supplemental Indenture a valid agreement of the Company, in accordance with its terms.

 

NOW, THEREFORE, the Company and the Trustee, intending to be legally bound hereby, agree, for the benefit of each other and for the equal and proportionate benefit of all Holders of any series of Securities not currently outstanding, as follows:

 

ARTICLE I

 

DEFINITIONS

 

Unless the context otherwise requires, capitalized terms used but not defined herein have the meaning set forth in the Base Indenture.  The following additional terms are hereby established for purposes of this Supplemental Indenture and shall have the meanings set forth in this Supplemental Indenture only for purposes of this Supplemental Indenture:

 

‘‘Annualized Consolidated EBITDA’’ means, for any quarter, the product of Consolidated EBITDA for such period of time multiplied by four.

 

 

‘‘Annualized Interest Expense’’ means, for any quarter, the Interest Expense for that quarter multiplied by four, provided that any nonrecurring item, as determined by the Company in good faith that is included in Interest Expense will be removed from such Interest Expense before such multiplication.

 

‘‘Consolidated EBITDA’’ means, for any period of time, the net income (loss) of the Company and its Subsidiaries, determined on a consolidated basis in accordance with GAAP for such period, before deductions for (without duplication):

 

(1)  Interest Expense;

 

(2)  taxes;

 

(3)  depreciation, amortization, and all other non-cash items, as determined reasonably and in good faith by the Company, deducted in arriving at net income (loss);

 

(4)  extraordinary items, including impairment charges;

 

(5)  non-recurring items or other unusual items, as determined reasonably and in good faith by the Company (including, without limitation, all prepayment penalties and all costs or fees incurred in connection with any debt financing or amendment thereto, acquisition, disposition, recapitalization or similar transaction (regardless of whether such transaction is completed));

 

(6)  noncontrolling interests;

 

(7)  income or expense attributable to transactions involving derivative instruments that do not qualify for hedge accounting in accordance with GAAP; and

 

(8)  gains or losses on dispositions of depreciable real estate investments, property valuation losses and impairment charges.

 

For purposes of calculating Consolidated EBITDA, all amounts shall be as determined reasonably and in good faith by the Company, and in accordance with GAAP except to the extent that GAAP is not applicable with respect to the determination of all non-cash and non-recurring items.

 

‘‘Consolidated Financial Statements’’ means, with respect to any Person, collectively, the consolidated financial statements and notes to those financial statements, of that Person and its subsidiaries prepared in accordance with GAAP.

 

‘‘GAAP’’ means generally accepted accounting principles in the United States, consistently applied, as in effect from time to time.

 

2

 

‘‘Incur’’ means, with respect to any Debt or other obligation of any Person, to create, assume, guarantee or otherwise become liable in respect of such Debt or other obligation, and ‘‘Incurrence’’ and ‘‘Incurred’’ have the meanings correlative to the foregoing.

 

‘‘Intercompany Debt’’ means, as of any date, Debt to which the only parties are the Company and any of its Subsidiaries as of such date; provided, however, that with respect to any such Debt of which the Company is the borrower, such Debt is subordinate in right of payment to the Securities.

 

‘‘Interest Expense’’ means, for any period of time, the aggregate amount of interest recorded in accordance with GAAP for such period by the Company and its Subsidiaries, but excluding (i) interest reserves funded from the proceeds of any loan, (ii) prepayment penalties, (iii) amortization of deferred financing costs, and (iv) non-cash swap ineffectiveness charges, in all cases as reflected in the applicable Consolidated Financial Statements.

 

‘‘Latest Completed Quarter’’ means, as of any date, the then most recently ended fiscal quarter of the Company for which Consolidated Financial Statements of the Company have been completed, it being understood that at any time when the Company is subject to the informational requirements of the Exchange Act, and in accordance therewith files annual and quarterly reports with the Commission, the term ‘‘Latest Completed Quarter’’ shall be deemed to refer to the fiscal quarter covered by the Company’s most recently filed Quarterly Report on Form 10-Q, or, in the case of the last fiscal quarter of the year, the Company’s Annual Report on Form 10-K.

 

‘‘Real Estate Assets’’ means, as of any date, the real estate assets of such Person and its Subsidiaries on such date, on a consolidated basis determined in accordance with GAAP.

 

‘‘Secured Debt’’ means, as of any date, that portion of the aggregate principal amount of all outstanding Debt of the Company and its Subsidiaries as of that date that is secured by a Lien on properties or other assets of the Company or any of its Subsidiaries.

 

‘‘Total Assets’’ means, as of any date, the consolidated total assets of the Company and its Subsidiaries, as such amount would appear on a consolidated balance sheet of the Company prepared as of such date in accordance with GAAP. ‘‘Total Assets’’ shall include Undepreciated Real Estate Assets and all other assets but shall exclude goodwill, and shall include the proceeds of the Debt or Secured Debt to be Incurred.

 

‘‘Total Unencumbered Assets’’ means, as of any date, Undepreciated Real Estate Assets of the Company and its Subsidiaries that are not subject to any Lien which secures Debt of any of the Company and its Subsidiaries plus, without duplication, loan loss reserves relating thereto, accumulated depreciation thereon, plus all other assets of the Company and its Subsidiaries as all such amounts would appear on a consolidated balance sheet of the Company prepared as of such date in accordance with GAAP plus the proceeds of the Debt or Secured Debt to be Incurred; provided, however, that ‘‘Total Unencumbered Assets’’ does not include net real estate investments under unconsolidated joint ventures of the Company and its Subsidiaries and does not include goodwill.

 

3

 

‘‘Undepreciated Real Estate Assets’’ means, as of any date, the amount of real estate assets valued at original cost plus capital improvements.

 

‘‘Unsecured Debt’’ means, as of any date, that portion of the aggregate principal amount of all outstanding Debt of the Company and its Subsidiaries as of that date that is not Secured Debt.

 

The following terms have been previously defined in the Base Indenture.  The meanings ascribed to such terms in the Base Indenture shall be superseded, solely insofar as it relates to Securities issued on or after the date of the Supplemental Indenture, by the meanings established by this Supplemental Indenture with respect to any Securities issued pursuant to the Indenture on and after the date of this Supplemental Indenture:

 

‘‘Debt’’ means, as of any date (without duplication), all indebtedness and liabilities for borrowed money, secured or unsecured, of the Company and its Subsidiaries, including mortgages and other notes payable (including any Securities to the extent outstanding from time to time), but excluding any indebtedness, including mortgages and other notes payable, which is secured by cash, cash equivalents, or marketable securities or defeased (it being understood that cash collateral shall be deemed to include cash deposited with a trustee with respect to third party indebtedness), Intercompany Debt and all liabilities associated with customary exceptions to non-recourse indebtedness, such as for fraud, misapplication of funds, environmental indemnities, voluntary bankruptcy, collusive involuntary bankruptcy and other similar exceptions. It is understood that Debt shall not include any redeemable equity interest in the Company.

 

‘‘Lien’’ means (without duplication) any lien, mortgage, trust deed, deed of trust, deed to secure debt, pledge, security interest, assignment for collateral purposes, deposit arrangement, or other security agreement, excluding any right of setoff but including, without limitation, any conditional sale or other title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and any other like agreement granting or conveying a security interest; provided that, for purposes hereof, ‘‘Lien’’ shall not include any mortgage that has been defeased by the Company or any of its Subsidiaries in accordance with the provisions thereof through the deposit of cash, cash equivalents or marketable securities (it being understood that cash collateral shall be deemed to include cash deposited with a trustee with respect to third party indebtedness).

 

‘‘Person’’ means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization, limited liability company or government or other entity.

 

‘‘Subsidiary’’ means, with respect to any Person, a corporation, partnership association, joint venture, trust, limited liability company or other business entity which is required to be consolidated with such Person in accordance with GAAP.

 

 

4

 

The words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Supplemental Indenture as a whole and not to any particular Article, Section or other subdivision.

 

ARTICLE II

 

EVENTS OF DEFAULT

 

SECTION 201                Section 501(5) of the Base Indenture.

 

Section 501(5) of the Base Indenture is eliminated in its entirety and replaced, solely insofar as it relates to Securities issued on or after the date of this Supplemental Indenture, with the following with respect to any Securities issued pursuant to the Indenture on and after the date of this Supplemental Indenture:

 

“(5)        if any event of default as defined in any mortgage, indenture or instrument, under which there may be issued, or by which there may be secured or evidenced, any indebtedness of the Company (including obligations under Capitalized Leases) in an aggregate amount in excess of $50,000,000, whether such indebtedness now exists or shall hereafter be created, shall happen and shall result in such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise become due and payable, and such acceleration shall not have been rescinded or annulled within ten days after there shall have been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Securities of that series, a written notice specifying such event of default and requiring the Company to cause such acceleration to be rescinded or annulled.”

 

ARTICLE III

 

COVENANTS

 

SECTION 301                Section 1008 of the Base Indenture.

 

Section 1008 “Limitations on Incurrence of Obligations for Borrowed Money” of the Base Indenture is eliminated in its entirety and replaced, solely insofar as it relates to Securities issued on or after the date of this Supplemental Indenture, with the following with respect to any Securities issued pursuant to the Indenture on and after the date of this Supplemental Indenture:

 

“Section 1008. Limitations on the Incurrence of Debt.

 

(a)           The Company shall not, and shall not permit any of its Subsidiaries to, Incur any Debt if, immediately after giving effect to the Incurrence of such additional Debt and any other Debt Incurred since the end of the Latest Completed Quarter and the application of the net proceeds therefrom, the aggregate principal amount of all outstanding Debt would exceed 60% of the sum of (without duplication) (i) Total Assets as of the end of the Latest Completed Quarter and (ii) the purchase price of any Real Estate Assets or mortgages receivable acquired or to be acquired in exchange for proceeds of any securities offering, and the amount of any securities offering proceeds received (to the extent such proceeds were not used to acquire Real Estate

 

5

 

Assets or mortgages receivable or to reduce Debt), since the end of the Latest Completed Quarter.

 

(b)           The Company shall not, and shall not permit any of its Subsidiaries to, Incur any Secured Debt if, immediately after giving effect to the Incurrence of such additional Secured Debt and any other Secured Debt Incurred since the end of the Latest Completed Quarter and the application of the net proceeds therefrom, the aggregate principal amount of all outstanding Secured Debt would exceed 40% of the sum of (without duplication) (i) Total Assets as of the end of the Latest Completed Quarter and (ii) the purchase price of any Real Estate Assets or mortgages receivable acquired or to be acquired in exchange for proceeds of any securities offering, and the amount of any securities offering proceeds received (to the extent such proceeds were not used to acquire Real Estate Assets or mortgages receivable or to reduce Debt), since the end of the Latest Completed Quarter.

 

(c)           The Company shall not, and shall not permit any of its Subsidiaries to, Incur any Debt if, immediately after giving effect to the Incurrence of such additional Debt and any other Debt Incurred since the end of the Latest Completed Quarter and the application of the net proceeds therefrom, the ratio of Annualized Consolidated EBITDA to Annualized Interest Expense for the Latest Completed Quarter would be less than 1.50 to 1.00 on a pro forma basis and calculated on the assumption (without duplication) that:

 

(1) the additional Debt and any other Debt Incurred by the Company or any of its Subsidiaries since the first day of the Latest Completed Quarter to the date of determination, which was outstanding at the date of determination, had been Incurred at the beginning of that period and continued to be outstanding throughout that period, and the application of the net proceeds of such Debt, including to refinance other Debt, had occurred at the beginning of such period; provided that in determining the amount of Debt so Incurred, the amount of Debt under any revolving credit facility shall be computed based upon the average daily balance of such Debt during such period;

 

(2) the repayment or retirement of any other Debt repaid or retired by the Company or any of its Subsidiaries since the first day of the Latest Completed Quarter to the date of determination had occurred at the beginning of that period; provided that in determining the amount of Debt so repaid or retired, the amount of Debt under any revolving credit facility shall be computed based upon the average daily balance of such Debt during such period; and

 

(3) in the case of any acquisition or disposition of any asset or group of assets (including, without limitation, by merger, or stock or asset purchase or sale) or the placement of any assets in service or removal of any assets from service by the Company or any of its Subsidiaries since the first day of the Latest Completed Quarter to the date of determination, the acquisition, disposition, placement in service or removal from service and any related repayment or refinancing of Debt had occurred as of the first day of such period, with the appropriate adjustments to Annualized Consolidated EBITDA and Annualized Interest Expense with respect to the acquisition, disposition, placement in service or removal from service being included in that pro forma calculation.”

 

6

 

SECTION 302                Section 1010 of the Base Indenture.

 

The following language shall be added to the Base Indenture as new Section 1010:

 

“Section 1010.  Maintenance of Total Unencumbered Assets.

 

The Company and its Subsidiaries shall maintain at all times Total Unencumbered Assets of not less than 150% of the aggregate principal amount of all outstanding Unsecured Debt.”

 

ARTICLE IV

 

MISCELLANEOUS

 

SECTION 401                Application of Supplemental Indenture.

 

Each and every term and condition contained in this Supplemental Indenture that modifies, amends or supplements the terms and conditions of the  Base Indenture shall apply only to any series of Securities not Outstanding prior to the execution and delivery hereof, and shall not apply any series of Outstanding Securities as of the date hereof; provided, however, that each and every term and condition contained in this Supplemental Indenture shall apply to each of the series of Securities titled the “2.700% Senior Notes due 2014,” the “3.750% Senior Notes due 2016,” the “5.375% Senior Notes due 2021” and the “6.750% Senior Notes due 2041” of the Company issued on the date hereof or hereafter and each series of Securities issued after the date of this Supplemental Indenture.  Except as specifically amended and supplemented by, or to the extent inconsistent with, this Supplemental Indenture, the Indenture shall remain in full force and effect and is hereby ratified and confirmed.

 

SECTION 402                Effective Date of Supplemental Indenture.

 

This Supplemental Indenture shall be effective upon the execution and delivery hereof by each of the parties hereto.

 

SECTION 403                Counterparts.

 

This Supplemental Indenture 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.

 

7

 

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed by their respective officers hereunto duly authorized, all as of the day and year first above written.

 

 

	
 
    	
HCP, INC.,
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Thomas M. Herzog
    
	
 
    	
Name:
    	
Thomas   M. Herzog
    
	
 
    	
Title:
    	
Executive   Vice President and
    
	
 
    	
 
    	
Chief   Financial Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
THE BANK OF NEW YORK MELLON
    
	
 
    	
TRUST COMPANY, N.A.,
    
	
 
    	
 
    	
as   Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Raymond Torres
    
	
 
    	
Name:
    	
Raymond   Torres
    
	
 
    	
Title:
    	
Senior   Associate
    

 

[Signature Page to Supplemental Indenture]Exhibit 4.2

 

	
No. A-1
    	
 
    	
PRINCIPAL   AMOUNT
    
	
CUSIP   NO. 40414LAB5
    	
 
    	
 
    
	
ISIN NO.:   US40414LAB53
    	
 
    	
$400,000,000
    

 

HCP, INC.

 

2.700% SENIOR NOTES DUE 2014

 

THIS SECURITY IS A GLOBAL SECURITY WITHIN THE MEANING SET FORTH IN THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE OF A DEPOSITARY.  THIS SECURITY IS EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE DEPOSITARY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND, UNLESS AND UNTIL IT IS EXCHANGED FOR SECURITIES IN DEFINITIVE FORM AS AFORESAID, MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ITS NOMINEE TO A SUCCESSOR DEPOSITARY OR ITS NOMINEE.

 

UNLESS THIS NOTE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”) TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND SUCH NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO., OR SUCH OTHER NAME AS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

HCP, INC., a Maryland corporation (the “Company”, which term shall include any successor under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of Four Hundred Million Dollars ($400,000,000) on February 1, 2014, and to pay interest thereon from January 24, 2011 or from the most recent interest payment date on which interest has been paid or duly provided for, semi-annually in arrears on February 1 and August 1 (each, an “Interest Payment Date”) of each year (or if such date is not a Business Day, on the next Business Day thereafter; no interest will accrue on such payment for the period from and after such Interest Payment Date to the date of such payment on the next succeeding Business Day), commencing August 1, 2011, at the rate of 2.700% per annum, until the entire principal amount hereof is paid or duly provided for.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date will, as provided in the Indenture, be paid to the Holder in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the Regular Record Date for such

 

 

interest, which shall be the date that is 15 calendar days prior to such Interest Payment Date, whether or not a Business Day.  Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date, and may either be paid to the Holder in whose name this Note (or one or more predecessor Notes) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Notes of this series not less than 10 days prior to such Special Record Date, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture.  Interest will be computed on the basis of a 360-day year of twelve 30-day months. Payments of principal, premium, if any, and interest in respect of this Note will be made by the Company in immediately available funds.

 

Payment of the principal of and interest on this Note shall be payable at the Corporate Trust Office of The Bank of New York Mellon Trust Company, N.A., located at 101 Barclay Street, Floor 8 W, New York, New York 10286 or at such other office or agency of the Company maintained for that purpose in The City of New York, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; provided, however, that, at the option of the Company, interest may be paid by check mailed to the address of the Person entitled thereto as such address shall appear on the Security Register or by transfer to an account maintained by the payee with a bank located in the United States; and, provided, further, that so long as this Note is registered in the name of DTC or its nominee, principal and interest payments will be paid to DTC or its nominee, as the Holder, by wire transfer in same-day funds.

 

Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

 

Unless the certificate of authentication hereon has been executed by the Trustee by manual signature of one of its authorized signatories, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed this     th day of                 , 2011.

 

 

	
 
    	
HCP, Inc.,
    
	
 
    	
a Maryland   corporation
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
Thomas M. Herzog
    
	
 
    	
Title:
    	
Executive Vice   President and 
   Chief Financial Officer
    

 

 

Attest:

 

 

	
By:
    	
 
    	
 
    	
 
    
	
Name:
    	
J. Alberto   Gonzalez-Pita
    	
 
    	
 
    
	
Title:
    	
Executive Vice   President, 
   General Counsel and Corporate 
   Secretary
    	
 
    	
 
    

 

 

	
 
    	
 
    	
 
    	
TRUSTEE’S CERTIFICATE   OF 
   AUTHENTICATION:
    

 

This is one of the Notes of the series designated herein referred to in the within-mentioned Indenture.

 

	
 
    	
 
    	
 
    	
The Bank of New   York Mellon Trust Company, 
   N.A., as Trustee
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
    Authorized   Signatory
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
Dated:   January 24, 2011
    

 

This Note is one of a duly authorized issue of securities (herein called the “Notes”) of HCP, Inc., a Maryland Corporation, and any of its successors and assigns (the “Company”), issued as a series of securities under an indenture dated as of September 1, 1993 (the “Base Indenture”) as supplemented by the First Supplemental Indenture, dated as of January 24, 2011 (the “Supplemental Indenture” and together with the Base Indenture, the “Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., as successor trustee to The Bank of New York (the “Trustee,” which term includes any successor trustee under the Indenture with respect to the Notes), reference is hereby made for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes and of the terms upon which the Notes are, and are to be, authenticated and delivered.  This Note is one of a duly authorized series of Securities of the Company designated as the “2.700% Senior Notes due 2014,” originally limited (subject to exceptions provided in the Indenture) in aggregate principal amount to $400,000,000; however, from time to time, without giving notice or seeking consent of the Holders of the Notes, the Company may issue additional Notes of this series having the same ranking, interest rate and maturity and other terms as this Note.  All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

If an Event of Default with respect to the Notes shall occur and be continuing, the principal of the Notes may be declared due and payable in the manner and with the effect provided in the Indenture.

 

The Notes are not subject to any sinking fund.

 

If, for any reason, the acquisition by the Company of all of the equity interests of HCR Properties, LLC, pursuant to the Purchase Agreement, dated as of December 13, 2010, by and among the Company, HCP 2010 REIT LLC, a Delaware limited liability company, HCR ManorCare, Inc., HCR Properties, LLC and HCR Healthcare, LLC (as amended, from time to time) (the “Purchase Agreement”) is not completed on or prior to June 13, 2011 (the ‘‘HCR ManorCare Facilities Acquisition Termination Date’’), the Notes shall become due and payable on the Special Mandatory Redemption Date (as defined below) at the Special Mandatory

 

 

Redemption Price (as defined below); provided, however, in the event that, as of such HCR ManorCare Facilities Acquisition Termination Date, each of the Deferral Conditions (as defined in the Purchase Agreement), shall have been satisfied or waived or, in the Company’s reasonable judgment, would reasonably be expected to be satisfied if the Closing (as defined in the Purchase Agreement) occurred on such date, such HCR ManorCare Facilities Acquisition Termination Date shall automatically be extended until September 13, 2011 to the extent the Deferral Conditions, in the Company’s reasonable judgment, would reasonably be expected to be satisfied (or waived), as the case may be, on or prior to such later date; provided further, however, that if the Purchase Agreement is terminated in accordance with its terms, the HCR ManorCare Facilities Acquisition Termination Date shall be the date the Purchase Agreement is terminated.

 

Notice of a special mandatory redemption will be mailed, with a copy to the Trustee, promptly after the occurrence of the event triggering such redemption to each Holder of Notes at its registered address. If funds sufficient to pay the Special Mandatory Redemption Price of all of the Notes to be redeemed on the Special Mandatory Redemption Date are deposited with The Bank of New York Mellon Trust Company, N.A., in its capacity as paying agent, on or before such Special Mandatory Redemption Date, on and after such Special Mandatory Redemption Date, the Notes will cease to bear interest and, other than the right to receive the Special Mandatory Redemption Price, all rights under the Notes shall terminate.

 

‘‘Special Mandatory Redemption Date’’ means the date which is 20 Business Days after the HCR ManorCare Facilities Acquisition Termination Date.

 

‘‘Special Mandatory Redemption Price’’ means 101% of the aggregate principal amount of the Notes together with accrued and unpaid interest to but excluding the Special Mandatory Redemption Date, as extended (if applicable).

 

The Notes may be redeemed, in whole or in part, at any time at the option of the Company at a Redemption Price equal to the greater of: (1) 100% of the principal amount of the Notes to be redeemed, or (2) the sum of the present values of the remaining scheduled payments of principal and interest thereon (exclusive of interest accrued to the Redemption Date) discounted to the Redemption Date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the applicable treasury rate (as defined below) plus 25 basis points, plus accrued and unpaid interest on the amount being redeemed to the Redemption Date.

 

‘‘Treasury rate’’ means, with respect to any Redemption Date:

 

·                  the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated ‘‘H.15(519)’’ or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded U.S. Treasury securities adjusted to constant maturity under the caption ‘‘Treasury Constant Maturities,’’ for the maturity corresponding to the comparable treasury issue (if no maturity is within three months before or after the remaining life (as defined below), yields for the two published maturities most closely corresponding to the comparable

 

 

treasury issue will be determined and the treasury rate will be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or

 

·                  if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the comparable treasury issue, calculated using a price for the comparable treasury issue (expressed as a percentage of its principal amount) equal to the comparable treasury price for such Redemption Date.

 

The treasury rate will be calculated by the Independent Investment Banker on the third Business Day preceding the date fixed for redemption.

 

‘‘Comparable treasury issue’’ means the U.S. Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term (‘‘remaining life’’) of the Notes to be redeemed that would be utilized, at the time of selection and in accordance with customary financial practice, in pricing new issues of corporate debt securities of comparable maturity to the remaining term of such Notes.

 

‘‘Comparable treasury price’’ means (1) the average of five Reference Treasury Dealer quotations for such Redemption Date, after excluding the highest and lowest Reference Treasury Dealer Quotations, or (2) if the Independent Investment Banker obtains fewer than five such Reference Treasury Dealer Quotations, the average of all such quotations.

 

‘‘Independent Investment Banker’’ means one of the Reference Treasury Dealers appointed by the Company to act as the ‘‘Independent Investment Banker.’’

 

‘‘Reference Treasury Dealers’’ means each of Merrill Lynch, Pierce, Fenner & Smith Incorporated, UBS Securities LLC, a Primary Treasury Dealer selected by Wells Fargo Securities, LLC, Citigroup Global Markets Inc. and J.P. Morgan Securities LLC and their respective successors; provided, however, that if any of the foregoing shall cease to be a primary U.S. Government securities dealer in the United States (a ‘‘Primary Treasury Dealer’’), the Company shall substitute therefor another nationally recognized investment banking firm that is a Primary Treasury Dealer.

 

‘‘Reference Treasury Dealer Quotations’’ means, with respect to each Reference Treasury Dealer and any Redemption Date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the comparable treasury issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker at 5:00 p.m., New York City time, on the third Business Day preceding such redemption date.

 

The Company may redeem the Notes in increments of $1,000. If the Company redeems less than all of the Notes, the Trustee will select the Notes to be redeemed using a method it considers fair and appropriate. The Company will cause notices of redemption to be mailed by first-class mail at least 30 but not more than 60 days before the Redemption Date to each Holder of Notes to be redeemed at its registered address.

 

 

If this Note is to be redeemed in part only, the notice of redemption that relates to this Note will state the portion of the principal amount thereof to be redeemed. The Company will issue a Note in principal amount equal to the unredeemed portion of this Note in the name of the Holder hereof upon cancellation of the original Note. Any Notes called for redemption will become due on the Redemption Date. On or after the Redemption Date, interest will cease to accrue on the Notes or portions of them called for redemption.

 

As provided in and subject to the provisions of the Indenture, the Holder of this Note shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Notes, the Holders of not less than 25% in principal amount of the Notes at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee reasonable indemnity and the Trustee shall not have received from the Holders of a majority in principal amount of the Notes at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding, for 60 days after receipt of such notice, request and offer of indemnity.  The foregoing shall not apply to any suit instituted by the Holder of this Note for the enforcement of any payment of principal hereof or any interest on or after the respective due dates expressed herein.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Notes under the Indenture at any time by the Company and the Trustee with the consent of the Holders of not less than a majority in aggregate principal amount of the Outstanding Notes.  The Indenture also contains provisions permitting the Holders of not less than a majority in principal amount of the Notes at the time Outstanding, on behalf of the Holders of all Notes, to waive compliance by the Company with certain provisions of the Indenture.  Furthermore, provisions in the Indenture permit the Holders of not less than a majority of the aggregate principal amount of the Outstanding Notes to waive, in certain circumstances, on behalf of all Holders of the Notes, certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.

 

No reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, which is absolute and unconditional, to pay the principal of, and interest on, this Note at the times, places and rate, and in the coin or currency, herein and in the Indenture prescribed.

 

As provided in the Indenture and subject to certain limitations set forth therein, the transfer of this Note may be registered on the Security Register upon surrender of this Note for registration of transfer at the office or agency of the Company maintained for the purpose in any place where the principal of and interest on this Note are payable, duly endorsed by or accompanied by a written instrument of transfer in form satisfactory to the Company and the

 

 

Security Registrar duly executed by the Holder hereof or by his attorney duly authorized in writing, and thereupon one or more new Notes of this series, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

This Note may be transferred, in whole but not in part, only to a nominee of DTC, or by a nominee of DTC to DTC, or to a successor to DTC for such Global Security selected or approved by the Company or to a nominee of such successor to DTC.  If at any time DTC notifies the Company that it is unwilling or unable to continue as depositary for the Notes or if at any time DTC ceases to be a clearing agency registered under the Exchange Act, if so required by applicable law or regulation, the Company shall appoint a successor depositary with respect to the Notes.  If (a) a successor depositary for the Notes is not appointed by the Company within 90 days after the Company receives such notice or becomes aware of such unwillingness, inability or ineligibility, (b) an Event of Default has occurred and is continuing and the beneficial owners representing a majority in principal amount of the Notes advise DTC to cease acting as depositary for such Notes, or (c) the Company, in its sole discretion, determines at any time that all Notes (but not less than all) of this series shall no longer be represented by such Global Note or Notes, then the Company shall execute, and the Trustee shall authenticate and deliver, definitive Notes of like series, rank, tenor and terms in definitive form in an aggregate principal amount equal to the principal amount of such Note or Notes.

 

The Notes are issuable only in registered form without coupons and may be sold in denominations of $2,000 and integral multiples of $1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, the Notes of this series are exchangeable for a like aggregate principal amount of Notes of this series in authorized denominations as requested by the Holders surrendering the same.  No service charge shall be made for any such registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of the Note for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the contrary.

 

The Indenture contains provisions whereby (i) the Indenture shall cease to be of further effect with respect to the Notes (subject to the survival of certain provisions thereof), (ii) the Company may be discharged from its obligations with respect to the Notes (subject to certain exceptions), or (iii) the Company may be released from its obligations under specified covenants and agreements in the Indenture, in each case if the Company satisfies certain conditions provided in the Indenture.

 

No recourse shall be had for the payment of the principal of or interest on this Note, or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any past, present or future stockholder, employee, officer or director, as such, of the Company or of any successor, either directly or through the Company or any successor, whether by virtue of any constitution, statute or rule of

 

 

law or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance hereof and as part of the consideration for the issue hereof, expressly waived and released.

 

THE INDENTURE AND THE NOTE SHALL BE DEEMED TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF CALIFORNIA, AND FOR ALL PURPOSES SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF SAID STATE.

 

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes as a convenience to the Holders of the Notes.  No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Notes, and reliance may be placed only on the other identification numbers printed hereon.

 

All terms used in this Note which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

 

ASSIGNMENT FORM
 FOR VALUE RECEIVED, THE UNDERSIGNED HEREBY
 SELLS, ASSIGNS AND TRANSFERS TO

 

PLEASE INSERT SOCIAL
 SECURITY OR OTHER IDENTIFYING
 NUMBER OF ASSIGNEE

	
 
    
	
 
    

 

(Please Print or Typewrite Name and Address

including Zip Code of Assignee)

 

	
the within Note of
    	
 
    	
and
    	
 
    	
hereby does   irrevocably constitute and appoint
    
	
 
    	
 
    	
 
    	
 
    	
 
    

Attorney to transfer said Note on the books of the within-named Company with full power of substitution in the premises.

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    

 

 

NOTICE: The signature to this assignment must correspond with the name as it appears on the first page of the within Note in every particular, without alteration or enlargement or any change whatever.

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