EXHIBIT 4.3
[FACE OF SECURITY]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO
TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.08 OF
THE INDENTURE.
HARBORSIDE HEALTHCARE CORPORATION
11% SENIOR SUBORDINATED DISCOUNT NOTE DUE 2008
No.1 CUSIP No.[ ]
$170,000,000 Principal Amount at Maturity
The following information is supplied for purposes of Sections 1273 and
1275 of the Internal Revenue Code:
Issue Date: [ ], 1998 Original issue discount under Section
1273 of the Internal Revenue Code (for
each $1,000 principal amount): $964.75
Yield to maturity for period from Issue Issue Price (for each $1,000 principal
Date to August 1, 2003: 11%, compounded amount): $585.25
semi-annually on August 1 and February 1,
commencing February 1, 2004
HARBORSIDE HEALTHCARE CORPORATION, a Delaware corporation (the "Company"),
promises to pay to CEDE & CO., or registered assigns, the principal sum of ONE
HUNDRED AND SEVENTY MILLION DOLLARS AND NO/100 ($170,000,000) on August 1, 2008.
Interest Payment Dates: February 1 and August 1, commencing February 1,
2004
Regular Record Dates: January 15 and July 15
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all purposes
have the same effect as if set forth at this place.
Dated: [ ], 1998
HARBORSIDE HEALTHCARE CORPORATION
By:________________________________
Name:
Title:
TRUSTEE'S CERTIFICATE OF AUTHENTICATION
This is one of the Securities referred to in the within-mentioned
Indenture.
UNITED STATES TRUST COMPANY
OF NEW YORK, as Trustee
By:________________________________
Authorized Signatory
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[REVERSE SIDE OF SECURITY]
11% Senior Subordinated Discount Note due 2008
1. INTEREST
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HARBORSIDE HEALTHCARE CORPORATION, a Delaware corporation (the "Company"),
promises to pay interest on the principal amount of this Security at the rate
per annum shown above.
The Company will pay interest semiannually on August 1 and February 1 of
each year commencing February 1, 2004; provided that no interest shall accrue on
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the principal amount of this Security prior to August 1, 2003 (the "Full
Accretion Date"), and no interest shall be paid on this Security prior to the
Full Accretion Date.
Interest will be computed on the basis of a 360-day year of twelve 30-day
months. The Company shall pay interest on overdue principal at the rate borne
by the Securities, and it shall pay interest on overdue installments of interest
at the same rate to the extent lawful.
2. METHOD OF PAYMENT
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The Company will pay interest (except defaulted interest) on the Securities
to the Persons who are registered holders of Securities at the close of business
on the January 15 or July 15 next preceding the interest payment date even if
Securities are cancelled after the record date and on or before the interest
payment date. Holders must surrender Securities to a Paying Agent to collect
principal payments. The Company will pay principal and interest in money of the
United States that at the time of payment is legal tender for payment of public
and private debts. However, the Company may pay principal and interest by check
payable in such money or by wire transfer of federal funds.
3. PAYING AGENT AND REGISTRAR
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Initially, UNITED STATES TRUST COMPANY OF NEW YORK (the "Trustee") will
act as Paying Agent and Registrar. The Company may appoint and change any
Paying Agent, Registrar or co-registrar without notice to the Holders. The
Company or any domestically organized Wholly Owned Restricted Subsidiary may act
as Paying Agent, Registrar or co-registrar.
4. INDENTURE
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The Company issued the Securities under an Indenture dated as of July 31,
1998 (the "Indenture"), between the Company and the Trustee. The terms of the
Securities include those stated in the Indenture and those made part of the
Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. (Sections)
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77aaa-77bbbb) as in effect on the date of the Indenture (the "Act"). Terms
defined in the Indenture and not defined herein have the meanings ascribed
thereto in the
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Indenture. The Securities are subject to all such terms, and Securityholders are
referred to the Indenture and the Act for a statement of those terms.
The Securities are unsecured senior subordinated obligations of the
Company. Subject to the conditions set forth in the Indenture, the Company may
issue Additional Securities.
5. OPTIONAL REDEMPTION
-------------------
Except as set forth in the next two paragraphs, the Securities may not be
redeemed at the Company's option prior to August 1, 2003. Thereafter, the
Securities will be subject to redemption at any time at the option of the
Company, in whole or in part, upon not less than 30 nor more than 60 days'
notice at the redemption prices (expressed as percentages of principal amount)
set forth below plus accrued and unpaid interest to the applicable redemption
date (subject to the right of Holders on the relevant record date to receive
interest due on the relevant interest payment date), if redeemed during the
twelve-month period beginning on August 1 of the years indicated below:
Year Redemption Price
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2003 105.500%
2004 103.667%
2005 101.883%
2006 and thereafter 100.000%
In addition, at any time and from time to time, prior to August 1, 2001,
the Company may redeem up to 35% of the sum of (i) the aggregate principal
amount at maturity of Securities and (ii) the aggregate principal amount at
maturity of any Additional Securities at a redemption price of 111% of the
Accreted Value thereof (determined at the redemption date) to the redemption
date, with the net cash proceeds received by the Company of a public offering of
common stock of the Company, provided that at least 65% of the sum of (i) the
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aggregate principal amount at maturity of Securities and (ii) the aggregate
principal amount at maturity of any Additional Securities remains outstanding
immediately after the occurrence of such redemption; and provided, further, that
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such redemption shall occur within 60 days of the date of the closing of such
public offering.
At any time on or prior to August 1, 2003, the Securities may be redeemed
as a whole but not in part at the option of the Company upon the occurrence of a
Change of Control, upon not less than 30 nor more than 60 days' prior notice
(but in no event may any such redemption occur more than 90 days after the
occurrence of such Change of Control) mailed by first-class mail to each
Holder's registered address, at a redemption price equal to 100% of the Accreted
Value thereof (determined at the redemption date) plus the Applicable Premium to
the redemption date (subject to the right of Holders on the relevant record date
to receive interest due on the relevant interest payment date).
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6. SPECIAL MANDATORY REDEMPTION
----------------------------
In the event that the Merger is not consummated prior to the earlier to
occur of (i) January 10, 1999 and (ii) if it appears, in the sole judgment of
the Company, that the Merger shall not be consummated, the date on which notice
of same is delivered by the Company to the Escrow Agent and the Trustee, the
Company shall be required to redeem the Securities, in whole, on at least 15
days' prior written notice mailed by first class mail to each Holder's last
address as it appears in the Securities Register, at a redemption price equal to
101% of the Accreted Value of the Securities on the date of repurchase to the
redemption date.
7. NOTICE OF REDEMPTION
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Notice of redemption will be mailed by first-class mail at least 30 days
(or in the case of a Special Mandatory Redemption described in paragraph 6
hereof, 15 days) but not more than 60 days before the redemption date to each
Holder of Securities to be redeemed at its registered address all in accordance
with the Indenture. If less than all of the Securities are to be redeemed at
any time, selection of Securities for redemption will be made by the Trustee in
compliance with the requirements of the principal national securities exchange,
if any, on which the Securities are listed, or, if the Securities are not so
listed, on a pro rata basis, by lot or by such method as the Trustee shall deem
fair and appropriate; provided that no Securities in an aggregate principal
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amount at maturity of $1,000 or less shall be redeemed in part.
If money sufficient to pay the redemption price of and accrued interest (if
any) on all Securities (or portions thereof) to be redeemed on the redemption
date is deposited with the Paying Agent on or before the redemption date and
certain other conditions are satisfied, on and after such date interest ceases
to accrue on such Securities (or such portions thereof) called for redemption.
8. REPURCHASE AT THE OPTION OF THE HOLDER
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Upon a Change of Control, any Holder of Securities will have the right,
subject to certain conditions set forth in the Indenture, to cause the Company
to repurchase all or any part of the Securities of such Holder at a purchase
price equal to 101% of the aggregate principal amount of the Securities to be
repurchased plus accrued and unpaid interest to the date of repurchase (subject
to the right of Holders of record on the relevant record date to receive
interest due on the relevant interest payment date that is on or prior to the
date of repurchase) as provided in, and subject to the terms of, the Indenture.
9. SUBORDINATION
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The Securities are subordinated to Senior Debt of the Company, as defined
in the Indenture. To the extent provided in the Indenture, Senior Debt of the
Company must be paid before the Securities may be paid. The Company agrees, and
each Securityholder by accepting a Security agrees, to the subordination
provisions contained in the Indenture and authorizes the Trustee to give it
effect and appoints the Trustee as attorney-in-fact for such purpose.
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10. DENOMINATIONS; TRANSFER; EXCHANGE
---------------------------------
The Securities are in registered form without coupons in denominations of
$1,000 and whole multiples of $1,000. A Holder may transfer or exchange
Securities in accordance with the Indenture. Upon any registration of transfer
or exchange, the Registrar and the Trustee may require a Holder, among other
things, to furnish appropriate endorsements or transfer documents and to pay any
taxes required by law or permitted by the Indenture. The Registrar need not
register the transfer of or exchange any Securities selected for redemption
(except, in the case of a Security to be redeemed in part, the portion of the
Security not to be redeemed) or to transfer or exchange any Securities for a
period of 15 days prior to a selection of Securities to be redeemed or 15 days
before an interest payment date.
11. PERSONS DEEMED OWNERS
---------------------
The registered Holder of this Security may be treated as the owner of it
for all purposes.
12. UNCLAIMED MONEY
---------------
If money for the payment of principal or interest remains unclaimed for two
years, the Trustee or Paying Agent shall pay the money back to the Company at
its written request unless an abandoned property law designates another Person.
After any such payment, Holders entitled to the money must look only to the
Company and not to the Trustee for payment.
13. DISCHARGE AND DEFEASANCE
------------------------
Subject to certain conditions set forth in the Indenture, the Company at
any time may terminate some or all of its obligations under the Securities and
the Indenture if the Company deposits with the Trustee money or Government
Obligations for the payment of principal and interest on the Securities to
redemption or maturity, as the case may be.
14. AMENDMENT, WAIVER
-----------------
Subject to certain exceptions set forth in the Indenture, (i) the Indenture
or the Securities may be amended with the written consent of the Holders of at
least a majority in principal amount outstanding of the Securities and (ii) any
past default or noncompliance with any provision of the Indenture may be waived
with the consent of the Holders of a majority in principal amount then
outstanding of the Securities. Subject to certain exceptions set forth in the
Indenture, without the consent of any Securityholder, the Company and the
Trustee may amend the Indenture or the Securities to cure any ambiguity, defect
or inconsistency, to provide for uncertificated Securities in addition to or in
place of certificated Securities (provided that the uncertificated Securities
are issued in registered form for purposes of Section 163(f) of the Code, or in
a manner such that the uncertificated Securities are described in Section
163(f)(2)(B) of the Code), to provide for the assumption of the Company*s or any
Guarantor*s obligations to Holders of Securities in the case of a merger,
consolidation or sale of assets, to release any Security Guarantee or collateral
in accordance with the provisions of the Indenture or Pledge Agreement, as the
case may be, to provide for additional Guarantors, to make any change that
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would provide any additional rights or benefits to the Holders of Securities or
that, as determined by the Board of Directors in good faith, does not have a
material adverse effect on the legal rights under this Indenture of any such
Holder, to comply with requirements of the SEC in order to effect or maintain
the qualification of the Indenture under the TIA or to provide for the issuance
of Additional Securities in compliance with Article II and Section 4.03 of the
Indenture.
15. DEFAULTS AND REMEDIES
---------------------
Under the Indenture, an Event of Default occurs if: (i) the Company
defaults in any payment of interest on any Security when the same becomes due
and payable, whether or not such payment shall be prohibited by Article X of the
Indenture, and such default continues for a period of 30 days; (ii) the Company
defaults in the payment of the principal of or premium, if any, on the
Securities, whether or not such payment shall be prohibited by Article X of the
Indenture; (iii) the Company fails to comply with other covenants and agreements
in the Indenture, subject to applicable grace periods as set forth in the
Indenture; (iv) certain accelerations (including failure to pay within any grace
period after final maturity) of other Debt of the Company or any Restricted
Subsidiary that is a Significant Subsidiary occur if the amount accelerated (or
so unpaid) exceeds $15,000,000; (v) certain events of bankruptcy, insolvency or
reorganization with respect to the Company and any Restricted Subsidiary which
is a Significant Subsidiary; (vi) certain judgments or decrees for the payment
of money in excess of $15,000,000 against the Company or any Restricted
Subsidiary that is a Significant Subsidiary; and (vii) except as is permitted by
the Indenture, a Security Guarantee by a Guarantor that is a Significant
Subsidiary shall be held in any judicial proceeding to be unenforceable or
invalid or shall for any reason cease to be in full force and effect or any
Guarantor, or any Person acting on behalf of any Guarantor, denies or disaffirms
its obligations under the Indenture or its Security Guarantee. If an Event of
Default occurs and is continuing, the Trustee or the Holders of at least 25% in
principal amount of the Securities may declare all the Securities to be due and
payable.
Securityholders may not enforce the Indenture or the Securities except as
provided in the Indenture. The Trustee may refuse to enforce the Indenture or
the Securities unless it receives reasonable indemnity or security. Subject to
certain limitations, Holders of a majority in principal amount of the Securities
may direct the Trustee in its exercise of any trust or power. The Trustee may
withhold from Securityholders notice of any continuing Default (except a Default
in payment of principal, premium, if any, or interest) if and so long as a
committee of its trust officers in good faith determines that withholding notice
is in the interest of the Holders.
16. TRUSTEE DEALINGS WITH THE COMPANY
---------------------------------
Subject to certain limitations imposed by the Act, the Trustee under the
Indenture, in its individual or any other capacity, may become the owner or
pledgee of Securities and may otherwise deal with and collect obligations owed
to it by the Company or its Affiliates and may otherwise deal with the Company
or its Affiliates with the same rights it would have if it were not Trustee.
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17. NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
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STOCKHOLDERS
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No director, officer, employee, incorporator, stockholder or Affiliate of
the Company, as such, will have any liability for any obligations of the Company
under the Securities, the Indenture or for any claim based on, in respect of, or
by reason of, such obligations or their creation. No director, officer,
employee, incorporator, stockholder or Affiliate of any of the Guarantors, as
such, will have any liability for any obligations of the Guarantors under the
Security Guarantees, the Indenture or for any claim based on, in respect of, or
by reason of, such obligations or their creation. Each Holder of Securities and
Security Guarantees by accepting a Security and a Security Guarantee waives and
releases all such liabilities. The waiver and release are part of the
consideration for issuance of the Securities and the Security Guarantees. Such
waiver may not be effective to waive liabilities under the federal securities
laws and it is the view of the SEC that such a waiver is against public policy.
18. GOVERNING LAW
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THE SECURITIES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE
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LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF
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CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER
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JURISDICTION WOULD BE REQUIRED THEREBY.
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19. AUTHENTICATION
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This Security shall not be valid until an authorized signatory of the
Trustee (or an authenticating agent) manually signs the certificate of
authentication on the other side of this Security.
20. ABBREVIATIONS
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Customary abbreviations may be used in the name of a Securityholder or an
assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the
entireties), JT TEN (= joint tenants with rights of survivorship and not as
tenants in common), CUST (= custodian), and U/G/M/A (= Uniform Gift to Minors
Act).
21. CUSIP NUMBERS
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Pursuant to a recommendation promulgated by the Committee on Uniform
Security Identification Procedures the Company has caused CUSIP numbers to be
printed on the Securities and have directed the Trustee to use CUSIP numbers in
notices of redemption as a convenience to Securityholders. No representation is
made as to the accuracy of such numbers either as printed on the Securities or
as contained in any notice of redemption and reliance may be placed only on the
other identification numbers placed thereon.
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THE COMPANY WILL FURNISH TO ANY SECURITYHOLDER UPON WRITTEN REQUEST AND
WITHOUT CHARGE TO THE SECURITYHOLDER A COPY OF THE INDENTURE WHICH HAS IN IT THE
TEXT OF THIS SECURITY IN LARGER TYPE. REQUESTS MAY BE MADE TO:
HARBORSIDE HEALTHCARE CORPORATION
c/o Gibson, Dunn & Crutcher LLP
200 Park Avenue, 48th Floor
New York, New York 10166
Attention: Joerg H. Esdorn, Esq.
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TRANSFER NOTICE
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
- ----------------------------------
____________________________________________________________________________
Please print or typewrite name and address including zip code of assignee
____________________________________________________________________________
the within Security and all rights thereunder, hereby irrevocably constituting
and appointing ____________________________________ attorney to transfer said
Security on the books of the Company with full power of substitution in the
premises.
OPTION OF ORDER TO ELECT PURCHASE
If you want to elect to have this Security purchased by the
Company pursuant to Section 4.06 or 4.08 of the Indenture, check the box:
[_] 4.06 Asset Sale [_] 4.08 Change of Control
If you want to elect to have only part of this Security purchased
by the Company pursuant to Section 4.06 or 4.08 of the Indenture, state the
amount: $______.
Date:______________ Your Signature: ______________________________________
(Sign exactly as your name appears on the other side
of the Security)
_________________________
Tax I.D. number
Signature Guarantee:_____________________________________
(Signature must be guaranteed by a participant in
a recognized signature guarantee medallion
program)
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