0000895345-05-000081.txt : 20120628
0000895345-05-000081.hdr.sgml : 20120628
20050124173039
ACCESSION NUMBER: 0000895345-05-000081
CONFORMED SUBMISSION TYPE: SC 13D
PUBLIC DOCUMENT COUNT: 9
FILED AS OF DATE: 20050124
DATE AS OF CHANGE: 20050124
GROUP MEMBERS: APPALOOSA INVESTMENT LIMITED PARTNERSHIP I
GROUP MEMBERS: APPALOOSA MANAGEMENT L.P.
GROUP MEMBERS: APPALOOSA PARTNERS INC.
GROUP MEMBERS: DAVID A. TEPPER
GROUP MEMBERS: PALOMINO FUND LTD.
SUBJECT COMPANY:
COMPANY DATA:
COMPANY CONFORMED NAME: BEVERLY ENTERPRISES INC
CENTRAL INDEX KEY: 0001040441
STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SKILLED NURSING CARE FACILITIES [8051]
IRS NUMBER: 621691861
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: SC 13D
SEC ACT: 1934 Act
SEC FILE NUMBER: 005-52627
FILM NUMBER: 05545367
BUSINESS ADDRESS:
STREET 1: ONE THOUSAND BEVERLY WAY
CITY: FORT SMITH
STATE: AR
ZIP: 72919
BUSINESS PHONE: 5014526712
MAIL ADDRESS:
STREET 1: ONE THOUSAND BEVERLY WAY
CITY: FORT SMITH
STATE: AR
ZIP: 72919
FORMER COMPANY:
FORMER CONFORMED NAME: NEW BEVERLY HOLDINGS INC
DATE OF NAME CHANGE: 19970604
FILED BY:
COMPANY DATA:
COMPANY CONFORMED NAME: APPALOOSA MANAGEMENT LP
CENTRAL INDEX KEY: 0001006438
IRS NUMBER: 223220835
STATE OF INCORPORATION: DE
FISCAL YEAR END: 1231
FILING VALUES:
FORM TYPE: SC 13D
BUSINESS ADDRESS:
STREET 1: 26 MAIN ST
STREET 2: 1ST FLOOR
CITY: CHATHAM
STATE: NJ
ZIP: 07928
BUSINESS PHONE: 9737017000
MAIL ADDRESS:
STREET 1: 26 MAIN ST
STREET 2: 1ST FLOOR
CITY: CHATAM
STATE: NJ
ZIP: 07928
SC 13D
1
dg13d-beverly_appaloosa.txt
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
Schedule 13D
Under the Securities Exchange Act of 1934
Beverly Enterprises, Inc.
-----------------------------------------
(Name of Issuer)
Common Stock, $.10 par value per share
-----------------------------------------
(Title of class of securities)
087851309
-----------------------------------------
(CUSIP Number)
Kenneth Maiman, Esq. Bradley Takahashi, Esq.
Appaloosa Management L.P. Franklin Mutual Advisers, LLC
26 Main Street, First Floor 51 John F. Kennedy Parkway
Chatham, NJ 07928 Short Hills, NJ 07078
(973) 701-7000 (973) 912-2000
Arnold M. Whitman Richard Marks, Esq.
Formation Capital, LLC Northbrook NBV, LLC
1035 Powers Place 500 Skokie Blvd, Ste. 310
Alpharetta, GA 30004 Northbrook, IL 60062
(770) 754-9660 (847) 559-1002
Robert C. Schwenkel, Esq.
Fried, Frank, Harris, Shriver & Jacobson LLP
One New York Plaza
New York, NY 10004-1980
(212) 859-8000
(Persons Authorized to Receive Notices and Communications)
January 14, 2005
-----------------------------------------
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule 13G to
report the acquisition that is the subject of this Schedule 13D, and is
filing this schedule because of ss.ss.240.13d-1(e), 240.13d-1(f) or
240.13d-1(g), check the following box. [ ]
CUSIP NO. 087851309 13D PAGE 2 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Appaloosa Investment Limited Partnership I
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,873,122
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 1,873,122
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
1,873,122
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.7%
TYPE OF REPORTING PERSON
14 PN
CUSIP NO. 087851309 13D PAGE 3 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Palomino Fund Ltd.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 British Virgin Islands
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,641,178
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 1,641,178
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
1,641,178
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.5%
TYPE OF REPORTING PERSON
14 CO
CUSIP NO. 087851309 13D PAGE 4 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Appaloosa Management L.P.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 3,514,300
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 3,514,300
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
3,514,300
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.3%
TYPE OF REPORTING PERSON
14 PN; IA
CUSIP NO. 087851309 13D PAGE 5 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Appaloosa Partners Inc.
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 3,514,300
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 3,514,300
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
3,514,300
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.3%
TYPE OF REPORTING PERSON
14 CO
CUSIP NO. 087851309 13D PAGE 6 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 David A. Tepper
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 USA
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 3,514,300
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 3,514,300
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
3,514,300
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.3%
TYPE OF REPORTING PERSON
14 IN; HC
CUSIP NO. 087851309 13D PAGE 7 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Franklin Mutual Advisers, LLC
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES 3,508,900
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY -0-
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 3,508,900
PERSON 10 SHARED DISPOSITIVE POWER
WITH -0-
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
3,508,900
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
3.2%
TYPE OF REPORTING PERSON
14 IA
CUSIP NO. 087851309 13D PAGE 8 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Northbrook NBV, LLC
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 WC
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Delaware
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,487,200
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 1,487,200
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
1,487,200
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.4%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 9 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 David Hokin
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 USA
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,487,200
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 1,487,200
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
1,487,200
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.4%
TYPE OF REPORTING PERSON
14 IN; HC
CUSIP NO. 087851309 13D PAGE 10 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Rob Rubin
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 USA
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,487,200
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 1,487,200
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
1,487,200
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.4%
TYPE OF REPORTING PERSON
14 IN
CUSIP NO. 087851309 13D PAGE 11 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Robert Hartman
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 USA
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 1,487,200
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 1,487,200
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
1,487,200
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
1.4%
TYPE OF REPORTING PERSON
14 IN
CUSIP NO. 087851309 13D PAGE 12 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 1995 David Reis Family Trust
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Connecticut
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 10,000
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 10,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
10,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 00
CUSIP NO. 087851309 13D PAGE 13 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 1995 Donna Reis Family Trust
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Connecticut
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 25,000
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 25,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
25,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 14 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Aaron Reis Spray Trust
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Connecticut
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 20,000
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 20,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
20,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 15 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Anna Reis Spray Trust
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Connecticut
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 22,500
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 22,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
22,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 16 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Alexander Reis Spray Trust
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Connecticut
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 22,500
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 22,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
22,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 17 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 David Reis Family Trust
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 OO
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Connecticut
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 22,500
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 22,500
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
22,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 18 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 David Reis
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 PF
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 United States
NUMBER OF 7 SOLE VOTING POWER
SHARES 95,000
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 125,000
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 95,000
PERSON 10 SHARED DISPOSITIVE POWER
WITH 125,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
220,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 IN
CUSIP NO. 087851309 13D PAGE 19 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Baylor Enterprises LLC
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 AF
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 Georgia
NUMBER OF 7 SOLE VOTING POWER
SHARES -0-
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 22,000
EACH 9 SOLE DISPOSITIVE POWER
REPORTING -0-
PERSON 10 SHARED DISPOSITIVE POWER
WITH 22,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
22,000
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1.0%
TYPE OF REPORTING PERSON
14 OO
CUSIP NO. 087851309 13D PAGE 20 OF PAGES
NAME OF REPORTING PERSON
SS. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
1 Arnold M. Whitman
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |X|
2 (b) |_|
3 SEC USE ONLY
SOURCE OF FUNDS
4 PF
CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT
TO ITEM 2(d) OR 2(e)
5 N/A
CITIZENSHIP OR PLACE OF ORGANIZATION
6 USA
NUMBER OF 7 SOLE VOTING POWER
SHARES 4,500
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY 22,000
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 4,500
PERSON 10 SHARED DISPOSITIVE POWER
WITH 22,000
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON
26,500
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES
N/A
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
Less than 1%
TYPE OF REPORTING PERSON
14 IN; HC
Item 1. Security and Issuer
This Statement on Schedule 13D (this "Statement") is filed with
respect to common stock, $.10 par value per share ("Beverly Enterprises
Shares"), of Beverly Enterprises, Inc., a Delaware corporation (the
"Company"). The principal executive office of the Company is located at One
Thousand Beverly Way, Fort Smith, Arkansas 72919.
Item 2. Identity and Background
This Statement is being filed by Appaloosa Investment Limited
Partnership I ("AILP"), Palomino Fund Ltd. ("Palomino"), Appaloosa
Management L.P. ("Appaloosa"), Appaloosa Partners Inc. ("API"), David A.
Tepper, Franklin Mutual Advisers, LLC ("Franklin Mutual"), Northbrook NBV
LLC ("Northbrook"), David Hokin, Rob Rubin, Robert Hartman, the 1995 David
Reis Family Trust ("1995 DRF Trust"), the 1995 Donna Reis Family Trust
("Donna Trust"), the Aaron Reis Spray Trust ("Aaron Trust"), the Anna Reis
Spray Trust ("Anna Trust"), the Alexander Reis Spray Trust ("Alexander
Trust"), the David Reis Family Trust ("DRF Trust"), David Reis, Baylor
Enterprises LLC ("Baylor") and Arnold M. Whitman (collectively, the "Filing
Persons"). The Filing Persons have entered into a Joint Filing Agreement,
dated as of January 24, 2004, a copy of which is attached hereto as Exhibit
A.
API is a Delaware corporation and the sole general partner of
Appaloosa, a Delaware limited partnership. Mr. Tepper is the sole
stockholder and sole director of API and is a U.S. citizen. Mr. Tepper's
present principal employment is as President of API. Ronald Goldstein is
the Secretary of API, and his present principal employment is as Vice
President of API ("Mr. Goldstein"). Lawrence O'Friel's present principal
employment is as treasurer of API ("Mr. O'Friel" and, together with Mr.
Goldstein, the "API Officers"). Each of the API Officers is a citizen of
the United States and disclaims beneficial ownership of any of the
securities covered by this Statement.
Appaloosa is the sole general partner of AILP, a Delaware limited
partnership, and Appaloosa makes all investment decisions for Palomino as
its investment adviser. AILP and Palomino are referred to herein
collectively as the "Appaloosa Purchasers." Palomino has no executive
officers, and its directors are as follows: Mr. Tepper, Ernest Morrison
("Mr. Morrison"), and Graham Cook ("Mr. Cook" and, together with Mr.
Morrison, the "Palomino Directors"). Mr. Morrison and Mr. Cook are each
citizens of the United Kingdom. Mr. Morrison's present principal employment
is as a partner of the law firm Cox Hallett Wilkinson. Mr. Cook's present
principal employment is as Managing Director of TMF (BVI) Limited and as
Managing Director of Bison Financial Services Limited. Each of the Palomino
Directors disclaims beneficial ownership of any of the securities covered
by this Statement.
The address of the principal business and/or principal office of each
of AILP, Appaloosa, API, Mr. Tepper and the API Officers is c/o API, 26
Main Street, 1st Floor, Chatham, New Jersey 07928. The address of the
principal business and principal office of Palomino is c/o Trident Trust
Company (Cayman) Ltd., 1 Capital Place, P.O. Box 847, Grand Cayman, Cayman
Islands. Mr. Morrison's principal business address at Cox Hallett Wilkinson
is Milner House, 18 Parliament Street, Hamilton, Bermuda. Mr. Cook's
principal business address at TMF (BVI) Limited is Mill Mall P.O. Box 964,
Road Town, Tortola, British Virgin Islands, and at Bison Financial Services
Limited, his principal business address is Bison Court, Yamraj Building,
Road Town, Tortola, British Virgin Islands.
Franklin Mutual is a limited liability company organized under the
laws of Delaware, and its principal business is as an investment adviser
registered with the U.S. Securities and Exchange Commission ("SEC") and
investment adviser to certain investment companies within the
Franklin/Templeton Group of Fund, including Franklin Mutual Series Fund
Inc. Franklin Mutual's principal business address is 51 John F. Kennedy
Parkway, Short Hills, New Jersey 07078. The names, addresses, principal
occupations and citizenship of each executive officer and director and each
controlling person, if any, of Franklin Mutual are set forth in Exhibit B
attached hereto.
Northbrook is a limited liability company organized under the laws of
Delaware, and its principal business is general investment activities. Each
of Messrs. Hokin, Hartman and Rubin is a Manager of Northbrook, and Mr.
Hokin is the controlling member. Mr. Hokin's principal employment is as
Chief Strategist for DH2, Inc., an Illinois corporation ("DH2"). Mr.
Rubin's principal employment is as Managing Director for DH2, whose
principal business is investment and advisory services. Mr. Hartman's
principal employment is as Chairman of Nucare Services Corp, an Illinois
corporation ("Nucare"), whose principal business is healthcare management.
The business address of each of Northbrook, DH2 and Messrs Hokin and Rubin
is 500 Skokie Boulevard, Suite 310, Northbrook, Illinois 60062. The
business address of each of Nucare and Mr. Hartman is 6633 N. Lincoln Ave.,
Lincolnwood, Illinois, 60712. Each of Messrs Hokin, Hartman and Rubin is a
U.S. citizen.
Each of the 1995 DRF Trust, Donna Trust, Aaron Trust, Anna Trust,
Alexander Trust and DRF Trust (together, the "Reis Trusts") is a personal,
discretionary family trust formed under the laws of Connecticut. Pursuant
to the trust agreements under which each Reis Trust was formed, the trustee
is authorized to make any investment of its trust fund which the trustee
considers to be in the best interests of the beneficiaries. None of the
Reis Trusts carries on business but holds property, including 200,000
Beverly Enterprises Shares in the aggregate. The records of each Reis Trust
are held at, and the mailing address of each Reis Trust is, 19 Hilltop
Place, Rye, NY 10580.
David Reis is a trustee of each of the Reis Trusts and serves as
Managing Member of Senior Care Development, LLC, a limited liability
company organized under the laws of Connecticut. His principal business
address is 19 Post Road East Westport, CT 06880. Mr. Reis is a U.S.
citizen.
Baylor is a limited liability company organized under the laws of
Georgia, and its principal business is holding selected securities.
Baylor's principal business address is c/o Formation Capital, LLC, 1035
Powers Place, Alpharetta, GA 30004.
Arnold M. Whitman is the controlling member of Baylor and serves as
Chief Executive Officer, Treasurer and Co-Chairman of Formation Capital,
LLC ("Formation"), a limited liability company organized under the laws of
Pennsylvania to invest in companies in the senior housing and long-term
care industry. Mr. Whitman's principal business address is c/o Formation
Capital, LLC, 1035 Powers Place, Alpharetta, GA 30004. Mr. Whitman is a
U.S. citizen.
During the last five years, none of the Filing Persons, Formation,
the API Officers, the Palomino Directors or any of the executive officers
listed in Exhibit B attached hereto has been (i) convicted in a criminal
proceeding (excluding traffic violations and similar misdemeanors), or (ii)
a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of or
prohibiting or mandating activities subject to federal or state securities
laws or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
The Beverly Enterprises Shares reported herein by the Appaloosa
Purchasers were acquired with funds of approximately $30,590,227.19
(including brokerage commissions). All of such funds were provided from
investment capital of each Appaloosa Purchaser. The Beverly Enterprises
Shares reported herein by Franklin Mutual were acquired with funds of
approximately $31,446,000 (including brokerage commissions). All of such
funds were provided from investment capital of Franklin Mutual's respective
advisory clients. The Beverly Enterprises Shares reported herein by
Northbrook were acquired with funds of approximately $13,344,744.62
(including brokerage commissions). All of such funds were provided from
Northbrook's working capital. The Beverly Enterprises Shares reported
herein by each of the Reis Trusts were acquired with funds (including
brokerage commissions) of approximately $89,000 for the 1995 DRF Trust,
$209,224 for the Donna Trust, $161,266 for the Aaron Trust, $183,373.97 for
the Anna Trust, $183,374 for the Alexander Trust, $205,616 for the DRF
Trust, and the Beverly Enterprises Shares reported herein by Mr. Reis in
his personal capacity were acquired with funds of approximately $610,557.
All of such funds were provided to each of the Reis Trusts from earnings
accumulated, in or contributions to, the general trust corpus, and the
funds provided to David Reis in his personal capacity were contributed by
Mr. Reis through his personal funds. The Beverly Enterprises Shares
reported herein by Baylor were acquired with funds of approximately
$198,019.80 (excluding brokerage commissions). All of such funds were
provided from a capital contribution from Baylor's controlling member,
Arnold M. Whitman. The Beverly Enterprises Shares reported herein by Mr.
Whitman in his personal capacity were acquired with funds of approximately
$40,511.45 (including brokerage commissions). All of such funds were
provided from Mr. Whitman's own personal funds.
Item 4. Purpose of Transaction
The Filing Persons acquired the Beverly Enterprises Shares reported
in Item 5 of this Statement in order to increase their equity interest in
the Company, which the Filing Persons believe is an attractive investment.
The Filing Persons are interested in exploring the possibility of a
negotiated transaction with the Company that would involve acquiring
control of the Company or purchasing its real estate assets and nursing
facilities operations (the "SNFs"). In this regard, during the week of
December 13, 2004, Mr. Whitman discussed the possibility of such a
transaction with William R. Floyd, the Chairman of the Board, President and
Chief Executive Officer of the Company. On December 22, 2004, Formation
sent a follow-up letter, a copy of which is attached hereto as Exhibit D
(the "December 22 Letter"), to Mr. Floyd, expressing its interest in
acquiring the issued and outstanding Beverly Enterprises Shares subject to
completion of Formation's due diligence review of the Company and execution
of definitive agreements and stating that it was prepared to immediately
commence due diligence review of the Company. In this letter, Formation
also stated that the terms of the letter were only intended as an outline
of certain material terms of the proposed transaction and were not intended
to be binding on the Company or Formation and, moreover, that they did not
include all the material terms, conditions, covenants, representations,
warranties and other provisions that would be contained in a definitive
agreement and other documentation.
On January 5, 2005, the Company responded to Formation's December 22
Letter in a letter, a copy of which is attached hereto as Exhibit E (the
"January 5 Letter"), indicating that the Company had shared the December 22
Letter with its Board of Directors which had engaged advisors to assist it
in evaluating Formation's indication of interest. On or about January 13,
2005, Mr. Whitman responded to the January 5 Letter and discussed further
with Mr. Floyd Formation's indication of interest. On January 19, 2005,
Formation expanded on its proposal as initially set forth in the December
22 Letter in a letter to the Company, a copy of which is attached hereto as
Exhibit F (the "January 19 Letter"), and reiterated the non-binding nature
of the proposed transaction on the Company and Formation.
The Filing Persons, Formation, any of the API Officers and Palomino
Directors or persons named in Exhibit B may also acquire additional Beverly
Enterprises Shares in the open market, in privately negotiated
transactions, or otherwise, and may contact the Company, its
representatives or other persons interested in the Company, for the purpose
of discussing the Company and the matters referred to in the December 22
Letter, January 5 Letter and January 19 Letter. The Filing Persons reserve
the right at any time (ii) to modify or withdraw their proposal as set
forth in the December 22 Letter and January 19 Letter, (ii) to terminate
their acting as a group in respect of the Beverly Enterprises Shares and
(iii) to dispose of some or all of their Beverly Enterprises Shares in the
open market or in privately negotiated transactions to third parties, or
otherwise, depending on the market conditions and other factors.
Although the foregoing represents the range of activities presently
contemplated by the Filing Persons and Formation with respect to the
Beverly Enterprises Shares, it should be noted that the possible activities
of the Filing Persons and Formation are subject to change at any time. In
particular, any one or more Filing Persons (and their respective
affiliates) reserves the right, in each case subject to any applicable
limitations imposed on the sale of any of their Beverly Enterprises Shares
by the Securities Act of 1933, as amended, and the rules promulgated
thereunder, to distribute or cause to be distributed Beverly Enterprises
Shares in kind to its limited partners, members or investors, as the case
may be, or to the limited partners, members or investors of one or more
Filing Persons controlled by it.
Item 5. Interest in Securities of the Issuer
(a) The Filing Persons beneficially own, as defined in Rule
13d-3 under the Securities Exchange Act of 1934 (the
"1934 Act"), 8,756,900 Beverly Enterprises Shares in the
aggregate. Based on the number of Beverly Enterprises
Shares reported as outstanding by the Company in recent
public filings, the Filing Persons beneficially own
approximately 8.1% of the Beverly Enterprises Shares as
calculated pursuant to Rule 13d-3(d)(1)(i):
(i) AILP is the owner of 1,873,122 Beverly Enterprises Shares
(or 1.7% of the outstanding Beverly Enterprises Shares).
Each Filing Person (other than AILP, Palomino, Appaloosa,
API and Mr. Tepper) disclaims beneficial ownership of
AILP's Beverly Enterprises Shares;
(ii) Palomino is the owner of 1,641,178 Beverly Enterprises
Shares (or 1.5% of the outstanding Beverly Enterprises
Shares). Each Filing Person (other than AILP, Palomino,
Appaloosa, API and Mr. Tepper) disclaims beneficial
ownership of Palomino's Beverly Enterprises Shares;
(iii) each of Appaloosa, API, and Mr. Tepper, by virtue of their
relationships to the Appaloosa Purchasers as described in
Item 2 above, may be deemed to be a beneficial owner of
3,514,300 Beverly Enterprises Shares in the aggregate (or
3.3% of the outstanding Beverly Enterprises Shares). None
of the API Officers and Palomino Directors owns, and each
disclaims beneficial ownership of, any of the Beverly
Enterprises Shares covered by this Statement. Each Filing
Person (other than AILP, Palomino, Appaloosa, API and Mr.
Tepper) disclaims beneficial ownership of the Beverly
Enterprises Shares owned by Appaloosa, API, and Mr.
Tepper;
(iv) Advisory clients of Franklin Mutual are the owners, in the
aggregate, of 3,508,900 Beverly Enterprises Shares under
investment advisory contracts that grant to Franklin
Mutual sole voting and investment discretion over such
shares. Therefore, Franklin Mutual may be deemed to be,
for purposes of Rule 13d-3 under the 1934 Act, the
beneficial owner of 3,508,900 Beverly Enterprises Shares,
representing approximately 3.2% of the outstanding Beverly
Enterprises Shares.
Franklin Mutual is an indirect wholly owned subsidiary of
Franklin Resources, Inc., a Delaware corporation ("FRI").
Beneficial ownership by investment advisory subsidiaries
and other affiliates of FRI is being reported in
conformity with the guidelines articulated by the SEC
staff in Release No. 34-39538 (January 12, 1998) relating
to organizations, such as FRI, where related entities
exercise voting and investment powers over the securities
being reported independently from each other. The voting
and investment powers held by Franklin Mutual are
exercised independently from FRI, and from all other
investment advisor subsidiaries of FRI (FRI, its
affiliates and investment advisor subsidiaries other than
Franklin Mutual are collectively referred to herein as
"FRI affiliates"). Furthermore, Franklin Mutual and FRI
internal policies and procedures establish informational
barriers that prevent the flow between Franklin Mutual and
the FRI affiliates of information that relates to the
voting and investment powers over the securities owned by
their respective advisory clients. Consequently, Franklin
Mutual and the FRI affiliates are each reporting the
securities over which they hold investment and voting
power separately from each other.
Charles B. Johnson and Rupert H. Johnson, Jr. (the
"Principal FRI Shareholders") each owns in excess of 10%
of the outstanding common stock of FRI and are the
principal shareholders of FRI. However, Franklin Mutual
exercises voting and investment powers on behalf of its
advisory clients independently of FRI, the Principal FRI
Shareholders, and their respective affiliates.
Consequently, beneficial ownership of the securities being
reported by Franklin Mutual, including the Beverly
Enterprises Shares being reported herein, is not
attributed to FRI, the Principal FRI Shareholders, and
their respective affiliates other than Franklin Mutual.
Franklin Mutual disclaims any economic interest or
beneficial ownership in any of the Beverly Enterprises
Shares that may be beneficially owned by FRI or its other
affiliates. Furthermore, FRI, the Principal FRI
Shareholders, and their respective affiliates, including
Franklin Mutual, are of the view that they are not acting
as a "group" for purposes of Section 13(d) under the 1934
Act and that they are not otherwise required to attribute
to each other the "beneficial ownership" of securities
held by any of them or by any persons or entities advised
by FRI subsidiaries. Each other Filing Person disclaims
beneficial ownership of the Beverly Enterprises Shares
owned by Franklin Mutual;
(v) Northbrook owns 1,487,200 Beverly Enterprises Shares which
represent approximately 1.4% of the outstanding
Beverly Enterprises Shares. Each of Messrs.
Hartman and Rubin, in their capacities as
Managers of Northbrook as disclosed in Item 2,
may be deemed to have beneficial ownership of the
1,487,200 Beverly Enterprises Shares owned by
Northbrook, and each of Messrs. Hokin, Hartman
and Rubin disclaims beneficial ownership of such
shares. Mr. Hokin, in his capacity as Manager
and controlling member of Northbrook, may be
deemed to be a beneficial owner of the Beverly
Enterprises Shares owned by Northbrook. Each
Filing Person (other than Northbrook) disclaims
beneficial ownership of the Beverly Enterprises
Shares owned by Northbrook;
(vi) the 1995 DRF Trust is the owner of 10,000 Beverly
Enterprises Shares (or less than 1.0% of the outstanding
Beverly Enterprises Shares). Each Filing Person (other
than Mr. Reis and each of the Reis Trusts) disclaims
beneficial ownership of the Beverly Enterprises Shares
owned by the 1995 DRF Trust;
(vii) the Donna Trust is the owner of 25,000 Beverly Enterprises
Shares (or less than 1.0% of the outstanding Beverly
Enterprises Shares). Each Filing Person (other than Mr.
Reis and each of the Reis Trusts) disclaims beneficial
ownership of the Beverly Enterprises Shares owned by the
Donna Trust;
(viii) the Aaron Trust is the owner of 20,000 Beverly Enterprises
Shares (or less than 1.0% of the outstanding Beverly
Enterprises Shares). Each Filing Person (other than Mr.
Reis and each of the Reis Trusts) disclaims beneficial
ownership of the Beverly Enterprises Shares owned by the
Aaron Trust;
(ix) the Anna Trust is the owner of 22,500 Beverly Enterprises
Shares (or less than 1.0% of the outstanding Beverly
Enterprises Shares). Each Filing Person (other than Mr.
Reis and each of the Reis Trusts) disclaims beneficial
ownership of the Beverly Enterprises Shares owned by the
Anna Trust;
(x) the Alexander Trust is the owner of 22,500 Beverly
Enterprises Shares (or less than 1.0% of the outstanding
Beverly Enterprises Shares). Each Filing Person (other
than Mr. Reis and each of the Reis Trusts) disclaims
beneficial ownership of the Beverly Enterprises Shares
owned by the Alexander Trust;
(xi) the DRF Trust is the owner of 25,000 Beverly Enterprises
Shares (or less than 1.0% of the outstanding Beverly
Enterprises Shares). Each Filing Person (other than Mr.
Reis and each of the Reis Trusts) disclaims beneficial
ownership of the Beverly Enterprises Shares owned by the
DRF Trust;
(xii) Mr. David Reis, in his personal capacity, has
beneficial ownership of 95,000 Beverly Enterprise
Shares (or less than 1.0% of the outstanding Beverly
Enterprises Shares and of which 20,000 are subject to
call options) and, by virtue of his status as trustee
of each of the Reis Trusts, may be deemed to share
beneficial ownership of 125,000 Beverly Enterprises
Shares held directly in the aggregate by the Reis
Trusts (or less than 1.0% of the outstanding Beverly
Enterprises Shares). Each Filing Person (other than Mr.
Reis) disclaims beneficial ownership of the 95,000
Beverly Enterprises Shares owned by Mr. Reis, and each
Filing Person (other than Mr. Reis and each Reis Trust)
disclaims beneficial ownership of the 125,000 Beverly
Enterprises Shares held directly in the aggregate by
the Reis Trusts, which Mr. Reis may be deemed to own by
virtue of his status as trustee to the Reis Trusts;
(xiii) Baylor is the owner of 22,000 Beverly Enterprises Shares
(or less than 1% of the outstanding Beverly Enterprises
Shares). Each Filing Person (other than Baylor and Mr.
Whitman) disclaims beneficial ownership of the Beverly
Enterprises Shares owned by Baylor;
(xiv) Mr. Arnold M. Whitman has sole beneficial ownership of
4,500 Beverly Enterprises Shares (or less than 1% of the
outstanding Beverly Enterprises Shares) and, solely by
virtue of his controlling interest in Baylor, may be
deemed to share beneficial ownership of 26,500 Beverly
Enterprises Shares with Baylor in the aggregate (or less
than 1% of the outstanding Beverly Enterprises Shares).
Each Filing Person (other than Mr. Whitman) disclaims
beneficial ownership of the 4,500 Beverly Enterprises
Shares owned by Mr. Whitman in his personal capacity, and
each Filing Person (other than Mr. Whitman and Baylor)
disclaims beneficial ownership of the 22,000 Beverly
Enterprises Shares held directly by Baylor, which Mr.
Whitman may be deemed to own by virtue of his controlling
interest in Baylor; and
(xv) Formation does not own any of the aggregate 1,733,700
Beverly Enterprises Shares (or less than 1.0% of the
outstanding Beverly Enterprises Shares) beneficially owned
by Northbrook, Messrs Hokin, Rubin and Hartman, any of the
Reis Trusts, Mr. Reis, Baylor and Mr. Whitman and
disclaims beneficial ownership of such shares.
By virtue of the Term Sheet, filed as Exhibit G to this Statement,
and the Joint Filing Agreement, filed as Exhibit H to this
Statement, each as described in Item 6 below, the Filing Persons
may be deemed to be members of a group as defined in Rule 13d-5(b)
and share beneficial ownership of the aggregate 8,756,900 Beverly
Enterprises Shares reported herein.
(b) By virtue of the relationships described in Item 2, the
Appaloosa Purchasers, Appaloosa, API and Mr. Tepper have shared
power to vote and direct the disposition of the Beverly
Enterprises Shares beneficially owned by them (as defined in
Rule 13d-3 under the 1934 Act). Franklin Mutual has the sole
power to vote and direct the disposition of the Beverly
Enterprises Shares it holds. By virtue of Messrs Hokin, Hartman
and Rubin's relationship to Northbrook as described in Item 2,
Northbrook and Messrs Hokin, Hartman and Rubin have shared power
to vote and direct the disposition of the Beverly Enterprises
Shares held by Northbrook. By virtue of the relationships
described in Item 2, the Reis Trusts and Mr. Reis have shared
power to vote and direct the disposition of the 125,000 Beverly
Enterprises Shares held by such trusts, and Mr. Reis has the
sole power to vote and direct the disposition of the 75,000
Beverly Enterprises Shares held by him in his personal capacity.
By virtue of Mr. Whitman's controlling interest in Baylor as
described in Item 2, Baylor and Mr. Whitman have shared power to
vote and direct the disposition of the 22,000 Beverly
Enterprises Shares held by Baylor, and Mr. Whitman has the sole
power to vote and direct the disposition of 4,500 Beverly
Enterprises Shares held by himself.
.(c) Exhibit C sets forth the purchases of Beverly Enterprises Shares
effected by any Filing Person, Formation, any API Officer or
Palomino Director or any person named in Exhibit B during the
past 60 days. All of such purchases were effected by the Filing
Persons on the New York Stock Exchange.
(d) Other than the Filing Persons and any person named in Exhibit B,
no person is known by any Filing Person to have the right to
receive or the power to direct the receipt of dividends from, or
the proceeds from the sale of, any Beverly Enterprises Shares
beneficially owned by the Filing Persons or other person named
in Exhibit B.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or
Relationships with Respect to Securities of the Issuer.
On December 14, 2004, Appaloosa, Eureka Capital Markets, LLC,
financial advisor to the Filing Persons in connection with the
Transaction ("Eureka"), Formation and Franklin Mutual (the
"Consortium Members") executed a term sheet setting forth the terms
by which they would work together to effect a transaction acquiring
the outstanding Beverly Enterprises Shares or the SNFs. Pursuant to
this term sheet, Appaloosa, Franklin Mutual and Formation would make
an aggregate equity contribution of $375 million to an entity newly
formed by Formation, consisting of $150 million from Appaloosa, $175
million from Franklin Mutual and $50 million from Formation. In
addition, the term sheet provides for the division of profits and
losses and payment of fees and expenses among the Consortium
Members. The description of this term sheet is qualified in its
entirety by reference to the term sheet dated December 14, 2004
filed as Exhibit G attached hereto and incorporated herein by
reference.
On January 24, 2005, the Filing Persons and Formation (the
"Parties"), entered into a letter agreement to ensure the
coordinated supply of information necessary for the timely filing of
a Schedule 13D by such members in acknowledgement that the
Consortium Members and their affiliates may be deemed to have formed
a "group" (within the meaning of Section 13(d)(3) of the 1934 Act).
Pursuant to this letter agreement, each Party is required, among
other things, to notify the other members promptly of each purchase
or sale of Beverly Enterprises Shares and any agreements, contracts,
arrangements, understandings, plans or proposals entered into by it
or its affiliates that are required to be disclosed under Item 7 of
Schedule 13D. The description of this letter agreement is qualified
in its entirety by reference to the letter agreement dated January
24, 2005 filed as Exhibit H hereto and incorporated herein by
reference.
Item 7. Material to be Filed as Exhibits
A. Joint Filing Agreement dated as of January 24, 2005. B. Executive
Officers of Franklin Mutual. C. Transactions in Beverly Enterprises Shares
Since November
18, 2004.
D. Letter dated December 22, 2004 from Formation to the Company. E. Letter
dated January 5, 2005 from the Company to Formation. F. Letter dated
January 19, 2005 from Formation to the Company. G. Term Sheet dated
December 14, 2004.
H. Agreement among Stockholders dated as of January 24, 2005.
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
APPALOOSA INVESTMENT LIMITED PARTNERSHIP I
By: Appaloosa Management L.P.,
its General Partner
By: Appaloosa Partners Inc.,
its General Partner
By:
-------------------------
Name: David A. Tepper
Title: President
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
PALOMINO FUND LTD.
By: Appaloosa Management L.P.,
its Investment Adviser
By: Appaloosa Partners Inc.,
its General Partner
By:
-------------------------
Name: David A. Tepper
Title: President
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
APPALOOSA MANAGEMENT L.P.
By: Appaloosa Partners Inc.,
its General Partner
By:
-------------------------
Name: David A. Tepper
Title: President
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
APPALOOSA PARTNERS INC.
By:
-------------------------
Name: David A. Tepper
Title: President
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
-------------------------------
DAVID A. TEPPER
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
Franklin Mutual Advisers, LLC
By:
------------------------
Name: David J. Winters
Title: President, Chief Executive
Officer and Chief Investment
Officer
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
NORTHBROOK NBV, LLC
By:
------------------------
Name:
Title:
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
-------------------------------
DAVID HOKIN
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
-------------------------------
ROB RUBIN
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
-------------------------------
ROBERT HARTMAN
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
1995 David Reis Family Trust
By:
-------------------------------
Name: David Reis
Title: Trustee
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
1995 DONNA Reis Family Trust
By:
-------------------------------
Name: David Reis
Title: Trustee
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
AARON REIS SPRAY TRUST
By:
-------------------------------
Name: David Reis
Title: Trustee
SIGNATURE
After reasonable inquiry and to the best of our knowledge and belief,
the Reporting Person certifies that the information set forth in this
statement is true, complete and correct.
Dated: January 24, 2005
ANNA REIS SPRAY TRUST
By:
-------------------------------
Name: David Reis
Title: Trustee
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, the Reporting Person certifies that the information set forth in
this statement is true, complete and correct.
Dated: January 24, 2005
ALEXANDER REIS SPRAY TRUST
By:_______________________________
Name: David Reis
Title: Trustee
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, the Reporting Person certifies that the information set forth in
this statement is true, complete and correct.
Dated: January 24, 2005
DAVID REIS FAMILY TRUST
By:_______________________________
Name: David Reis
Title: Trustee
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, the Reporting Person certifies that the information set forth in
this statement is true, complete and correct.
Dated: January 24, 2005
-------------------------------
DAVID REIS
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, the Reporting Person certifies that the information set forth in
this statement is true, complete and correct.
Dated: January 24, 2005
BAYLOR ENTERPRISES LLC
By:_______________________________
Name: Arnold M. Whitman
Title: Managing Member
SIGNATURE
After reasonable inquiry and to the best of our knowledge and
belief, the Reporting Person certifies that the information set forth in
this statement is true, complete and correct.
Dated: January 24, 2005
-------------------------------
ARNOLD M. WHITMAN
EXHIBIT INDEX
EXHIBIT NAME
A. Joint Filing Agreement dated January 24, 2005. B. Executive Officers of
Franklin Mutual.
C. Transactions in Beverly Enterprises Shares Since November 18, 2004. D.
Letter dated December 22, 2004 from Formation to the Company. E. Letter
dated January 5, 2005 from the Company to Formation. F. Letter dated
January 19, 2005 from Formation to the Company. G. Term Sheet dated
December 14, 2004.
H. Agreement Among Shareholders dated January 24, 2005.
EX-99.A
2
dgex99a.txt
Exhibit A
JOINT FILING AGREEMENT
The undersigned hereby agree that the Statement on Schedule 13D
filed herein (and any amendments thereto), relating to the common stock,
$0.10 par value, of Beverly Enterprises, Inc., is being filed jointly with
the Securities and Exchange Commission pursuant to Rule 13d-1(k)(1) under
the Securities Exchange Act of 1934, as amended, on behalf of each such
person.
Dated: January 24, 2005
APPALOOSA INVESTMENT LIMITED
PARTNERSHIP I
By: APPALOOSA MANAGEMENT L.P.,
Its General Partner
By: APPALOOSA PARTNERS INC.,
Its General Partner
By: /s/ David A. Tepper
--------------------------------
Name: David A. Tepper
Title: President
PALOMINO FUND LTD.
By: APPALOOSA MANAGEMENT L.P.,
Its Investment Adviser
By: APPALOOSA PARTNERS INC.,
Its General Partner
By: /s/ David A. Tepper
--------------------------------
Name: David A. Tepper
Title: President
APPALOOSA MANAGEMENT L.P.
By: APPALOOSA PARTNERS INC.,
Its General Partner
By: /s/ David A. Tepper
-------------------------------------
Name: David A. Tepper
Title: President
APPALOOSA PARTNERS INC.
By: /s/ David A. Tepper
------------------------------------------
Name: David A. Tepper
Title: President
/s/ David A. Tepper
----------------------------------------------
David A. Tepper
FRANKLIN MUTUAL ADVISERS, LLC
By: /s/ David J. Winters
------------------------------------------
Name: David J. Winters
Title: President, Chief Executive Officer
and Chief Investment Officer
NORTHBROOK NBV, LLC
By: /s/ Rob Rubin
-------------------------------------------
Name: Rob Rubin
Title: Manager
/s/ David Hokin
----------------------------------------------
DAVID HOKIN
/s/ Rob Rubin
----------------------------------------------
ROB RUBIN
/s/ Robert Hartman
----------------------------------------------
ROBERT HARTMAN
1995 DAVID REIS FAMILY TRUST
By:/s/ David Reis
-------------------------------------------
Name: David Reis
Title: Trustee
1995 DONNA REIS FAMILY TRUST
By:/s/ David Reis
-------------------------------------------
Name: David Reis
Title: Trustee
AARON REIS SPRAY TRUST
By:/s/ David Reis
-------------------------------------------
Name: David Reis
Title: Trustee
ANNA REIS SPRAY TRUST
By:/s/ David Reis
-------------------------------------------
Name: David Reis
Title: Trustee
ALEXANDER REIS SPRAY TRUST
By:/s/ David Reis
-------------------------------------------
Name: David Reis
Title: Trustee
DAVID REIS FAMILY TRUST
By:/s/ David Reis
-------------------------------------------
Name: David Reis
Title: Trustee
/s/ David Reis
----------------------------------------------
DAVID REIS
BAYLOR ENTERPRISES LLC
By:/s/ Arnold M. Whitman
-------------------------------------------
Name: Arnold M. Whitman
Title: Managing Member
/s/ Arnold M. Whitman
----------------------------------------------
ARNOLD M. WHITMAN
EX-99.B
3
dgex99b.txt
Exhibit B
EXECUTIVE OFFICERS OF FRANKLIN MUTUAL ADVISERS, LLC
Each of the individuals named below is a citizen of the United
States with a principal business address as indicated below.
------------------------- ------------------------- -------------------------
NAME PRINCIPAL OCCUPATION ADDRESS
------------------------- ------------------------- -------------------------
Michael Embler Senior Vice President Short Hills (1)
------------------------- ------------------------- -------------------------
Martin L. Flanagan Senior Vice President and San Mateo (2)
Chief Financial Officer
------------------------- ------------------------- -------------------------
Barbara J. Green Secretary San Mateo (2)
------------------------- ------------------------- -------------------------
Ephraim Karpel Vice President - Trading Short Hills (1)
------------------------- ------------------------- -------------------------
Charles R. Sims Treasurer San Mateo (2)
------------------------- ------------------------- -------------------------
Bradley Takahashi Vice President Short Hills (1)
------------------------- ------------------------- -------------------------
David Winters President, Chief Executive Short Hills (1)
Officer and Chief Investment
Officer
------------------------- ------------------------- -------------------------
Timothy S. Stearns Chief Compliance Officer Ft. Lauderdale (3)
------------------------- ------------------------- -------------------------
(1) Franklin Mutual Advisers, LLC, 51 John F. Kennedy Parkway,
Short Hills, NJ. An investment adviser registered with the U.S.
Securities and Exchange Commission and investment adviser to the
Franklin Mutual Series Fund Inc.
(2) Franklin Resources, Inc., One Franklin Parkway, San Mateo, CA
94403. Parent Company of Franklin/Templeton Distributors, Inc.
(the Parent Company of Franklin Mutual Advisers, LLC) and a
number of investment advisers and administrative companies
providing investment advice and administrative services to the
Franklin/Templeton Group of Funds, Franklin Mutual Series Fund
Inc., managed accounts and other investment products.
(3) Franklin Resources, Inc., 500 E. Broward Blvd., Ft.
Lauderdale, FL 33394.
EX-99.C
4
dgex99c.txt
Exhibit C
TRANSACTIONS IN BEVERLY ENTERPRISES SHARES SINCE NOVEMBER 18, 2004
The transactions in Beverly Enterprises Shares by any Filing
Person, Formation, any API Officer or Palomino Director or any person
listed on Exhibit B attached hereto are listed below with (unless otherwise
noted) the dates of the transaction, amount of shares purchased and
approximate price per share (including commissions), if any:
Date of Amount of Buy/Sell Price Per
Transaction Shares Share or
Option
AILP January 7, 2005 73,074 Buy 8.9341
January 13, 2005 68,224 Buy 8.6452
January 14, 2005 87,945 Buy 9.0330
January 18, 2005 213,200 Buy 9.2586
January 19, 2005 213,200 Buy 9.5761
January 20, 2005 139,433 Buy 9.6044
January 21, 2005 39,229 Buy 9.5893
January 24, 2005 45,891 Buy 9.5302
Palomino January 7, 2005 64,026 Buy 8.9341
January 13, 2005 59,776 Buy 8.6452
January 14, 2005 77,055 Buy 9.0330
January 18, 2005 186,800 Buy 9.2586
January 19, 2005 186,800 Buy 9.5761
January 20, 2005 122,167 Buy 9.6044
January 21, 2005 34,371 Buy 9.5893
January 24, 2005 40,209 Buy 9.5302
Appaloosa January 7, 2005 137,100 Buy 8.9341
January 13, 2005 128,000 Buy 8.6452
January 14, 2005 165,000 Buy 9.0330
January 18, 2005 400,000 Buy 9.2586
January 19, 2005 400,000 Buy 9.5761
January 20, 2005 261,600 Buy 9.6044
January 21, 2005 73,600 Buy 9.5893
January 24, 2005 86,100 Buy 9.5302
API January 7, 2005 137,100 Buy 8.9341
January 13, 2005 128,000 Buy 8.6452
January 14, 2005 165,000 Buy 9.0330
January 18, 2005 400,000 Buy 9.2586
January 19, 2005 400,000 Buy 9.5761
January 20, 2005 261,600 Buy 9.6044
January 21, 2005 73,600 Buy 9.5893
January 24, 2005 86,100 Buy 9.5302
David Tepper January 7, 2005 137,100 Buy 8.9341
January 13, 2005 128,000 Buy 8.6452
January 14, 2005 165,000 Buy 9.0330
January 18, 2005 400,000 Buy 9.2586
January 19, 2005 400,000 Buy 9.5761
January 20, 2005 261,600 Buy 9.6044
January 21, 2005 73,600 Buy 9.5893
January 24, 2005 86,100 Buy 9.5302
Franklin January 13, 2005 128,000 Buy $8.6452
Mutual
January 14, 2005 165,000 Buy $9.0430
January 18, 2005 400,000 Buy $9.2586
January 19, 2005 400,000 Buy $9.5811
January 20, 2005 261,600 Buy $9.6094
Northbrook
NBV LLC
Footnote1 December 1, 2004 2,000 Sell $9.147
Footnote1 December 1, 2004 3002 Sell $0.853
Footnote1 December 2, 2004 17,000 Sell $9.292
Footnote1 December 3, 2004 10,000 Buy $9.153
Footnote1 December 6, 2004 14,000 Buy $8.909
Footnote1 December 7, 2004 15,000 Buy $8.754
Footnote1 December 8, 2004 3,0002 Sell $0.74
Footnote1 December 9, 2004 1,0002 Sell $0.8235
Footnote1 December 10, 1,0002 Sell $0.723
2004
Footnote1 December 13, 1,0002 Sell $0.773
2004
Footnote1 December 15, 1,0002 Sell $0.523
2004
Footnote1 December 17, 1,000 Sell $8.98
2004
Footnote1 December 17, 1,0002 Sell $0.774
2004
Footnote1 December 20, 1,000 Buy $8.81
2004
Footnote1 December 20, 3002 Sell $0.752
2004
Footnote1 December 21, 1,0002 Sell $0.773
2004
Footnote1 January 12, 2005 5,000 Sell $8.747
Footnote1 January 13, 2005 5,000 Buy $8.653
Northbrook January 13, 2005 750,000 Buy $8.60
(Footnote3)
Footnotes1, January 13, 2005 750,000 Sell $8.60
3
Northbrook January 13, 2005 64,000 Buy $8.6452
Northbrook January 14, 2005 82,500 Buy $9.033
Northbrook January 18, 2005 200,000 Buy $9.2586
Northbrook January 19, 2005 200,000 Buy $9.5761
Footnote1 January 19, 2005 1,0002 Sell $0.8735
Northbrook January 20, 2005 130,800 Buy $9.6044
Footnote1 January 20, 2005 10,600[2] Buy $0.7514
Northbrook January 20, 2005 10,600[2] Sell $0.7514
Northbrook January 21, 2005 10,600[2] Buy $1.05
Northbrook January 21, 2005 36,800 Buy $9.5893
Northbrook January 24, 2005 23,100 Buy $9.5302
Anna Reis January 4, 2005 2,500 Buy $8.84
Spray Trust
Alexander January 4, 2005 2,500 Buy $8.84
Reis Spray
Trust
David Reis January 21, 2005 20,0004 Buy $0.7205
Baylor December 20, 22,000 Buy 9.001
Enterprises 2004 (excluding
LLC commissions)
Arnold M. December 20, 1,100 Buy $8.98
Whitman 2004
December 20, 3,400 Buy $8.99
2004
-------------------
1 An entity controlled by Messrs. Hokin and Rubin effected this
transaction. Each of the Beverly Enterprises Shares purchased by this
entity were sold to Northbrook NBV, LLC on January 13, 2005 in a private
transaction at a price of $8.60 per share. See Note 3.
2 Consists of a transaction in respect of
July 2005 Call Options exercisable for 100
Beverly Enterprises Shares per option at a
strike price of $10.00.
3 Northbrook NBV, LLC acquired these shares of common stock in a
private transaction from an entity managed by Messrs. Hokin and
Rubin. See Note 1.
4 Consists of a transaction in respect of
April 2005 Call Options exercisable for 100
Beverly Enterprises Shares per option at a
strike price of $10.00.
EX-99.D
5
letter12_22.txt
Exhibit D
[FORMATION CAPITAL, LLC LETTERHEAD]
December 22, 2004
Mr. William R. Floyd
Chairman of the Board, President
And Chief Executive Officer
Beverly Enterprises, Inc.
One Thousand Beverly Way
Fort Smith, Arkansas 72919
Dear Mr. Floyd:
Formation Capital, LLC, ("Formation") is writing to you, in your
capacity as Chairman of the Board, to confirm our conversation in which we
expressed our interest in acquiring the issued and outstanding shares of
Beverly Enterprises, Inc. ("Beverly" or the "Company"). We would expect
that you would share this letter with your Board of Directors promptly.
Subject to the terms and conditions outlined in this letter, Formation
hereby offers to pay the holders of the Company's issued and outstanding
shares of common stock, par value $.01 per share (the "Common Stock"), a
price of $11.50 per share in cash (the "Offer Price"). This translates into
a share price premium of 30% based on the average closing price for the
Company's stock over the last twenty trading days. Our Offer Price is based
upon a total of approximately 122,850,103 shares of Common Stock
outstanding (including an estimated 15,432,103 from the conversion of the
2.75% Convertible Subordinated Notes due 2033), 3,141,006 restricted shares
and options to acquire approximately 7,400,000 shares of Common Stock at a
weighted average exercise price of approximately $7.50 per share. Holders
of such options would be entitled to receive an amount in cash equal to the
excess of the Offer Price per share over the exercise price per share of
such options.
The Offer Price is subject to the completion of business, regulatory,
legal and accounting due diligence. However, if our due diligence suggests
that there is more value in the Company, we are prepared to raise the Offer
Price accordingly.
Further, as an alternative to the proposal outlined above, we would be
prepared to discuss with the Board of Directors a transaction whereby we
would purchase the Company's real estate assets and nursing facilities
operations, leaving the Company with the ancillary businesses (consisting
of the Aegis Therapies and Home Care operating segments). As we discussed,
the acquisition of the ancillary businesses is not part of our core
business strategy.
We anticipate that the acquisition would be effected through a
one-step merger of a new company formed by Formation with and into the
Company (the "Transaction"). The Transaction would be financed with $375
million of committed equity financing and the balance in debt. The equity
would be contributed by existing Formation investors, Appaloosa Management
L.P., ("Appaloosa") and Franklin Mutual Advisers, LLC ("Franklin"). This
group currently holds, in aggregate, approximately 4.5% of the Common Stock
of Beverly.
Based on our discussions with leading financial institutions, we
expect to be able to secure the required amount of debt financing. Prior to
the execution of a definitive agreement, Formation will deliver to Beverly
a binding commitment letter for the debt financing with customary closing
conditions.
Formation provides equity to the senior housing and long-term care
industry. Over the last three years, Formation has acquired an ownership
interest in 152 facilities in 20 states. Most recently, in August 2004,
Formation acquired Centennial HealthCare, adding 66 facilities to its
portfolio. Currently, Formation manages assets in excess of $650 million in
value.
Appaloosa, formed in 1993, is one of the largest hedge funds in the
country, with over $3.5 billion under management. Franklin is a subsidiary
of Franklin Resources, Inc., the largest publicly traded mutual fund
company in America. Franklin manages the Mutual Series family of public
mutual funds, with over $35 billion in assets under management.
We are prepared to immediately commence our business, regulatory,
legal and accounting due diligence review of the Company, and believe that
we could complete this work within 30 days after being provided or given
access to the items necessary to complete our due diligence. Therefore,
assuming cooperation by the Company, we believe that our due diligence
could be completed and a fully financed definitive agreement could be
negotiated and executed within four to six weeks.
This proposal is being provided to you on a confidential basis and we
would expect that you will not disclose this proposal to anyone other than
your Board of Directors, legal and financial advisors. The terms of this
letter are intended as an outline of certain material terms of the proposed
Transaction, but are not binding on you, the Company or us and do not
include all the material terms, conditions, covenants, representations,
warranties and other provisions that will be contained in a definitive
agreement and other documentation.
We are prepared to discuss all aspects of this proposal with the
Company, its Board of Directors and its advisors at their earliest
convenience. If you have any questions about this proposal, please do not
hesitate to call me at (770) 754-9660. We look forward to your prompt
response.
Sincerely,
Formation Capital, LLC
/s/ Arnold M. Whitman
------------------------------
Arnold M. Whitman
Chief Executive Officer
EX-99.E
6
beverlyenterprisesletter.txt
Exhibit E
[BEVERLY ENTERPRISES LETTERHEAD]
January 5, 2005
Arnold M. Whitman
Chief Executive Officer
Formation Capital, LLC
1035 Powers Place
Alpharetta, GA 30004
Dear Arnie:
Thank you for your letter dated December 27, 2004 indicating Formation's
interest in discussing alternatives for Beverly Enterprises, Inc.
I have shared your letter with our Board of Directors. The Board has
engaged appropriate advisors to assist them in evaluating your indication
of interest. We have scheduled a Board meeting in late January to engage in
a discussion, which will take into account all relevant factors.
We appreciate your interest in Beverly Enterprises.
Very truly yours,
/s/ William R. Floyd
--------------------------------
William R. Floyd
Chairman of the Board, President
and Chief Executive Officer
cc: Board of Directors
EX-99.F
7
responseletter1_18.txt
Exhibit F
[FORMATION CAPITAL, LLC LETTERHEAD]
January 19, 2005
Mr. William R. Floyd
Chairman of the Board, President
And Chief Executive Officer
Beverly Enterprises, Inc.
One Thousand Beverly Way
Fort Smith, Arkansas 72919
Dear Bill:
Thank you for your letter dated January 5, 2005. We look forward to
hearing from you on January 24, 2005 following your scheduled Board of
Directors meeting. In the interim, we thought we might facilitate your
Board's discussions by providing some additional detail regarding our
acquisition proposal.
First, Formation Capital, LLC, ("Formation") would like to reiterate
our offer to acquire the issued and outstanding shares of common stock of
Beverly Enterprises, Inc. ("Beverly" or the "Company") at $11.50 per share
(the "Offer Price"), subject to the terms and conditions outlined in our
December 22, 2004 letter.
Alternatively, as also indicated in our previous letter, we are
prepared to undertake a transaction whereby we would purchase the Company's
real estate assets and nursing facilities operations (the "SNFs"), leaving
the Company with the Aegis Therapies business and Home Care operating
segment (the "Ancillary Businesses"). Further, we would anticipate that as
part of such a transaction, we would enter into contractual agreements
whereby Beverly would continue to provide ancillary services to the nursing
facilities. We believe this transaction could be structured in several ways
and we would seek to adopt an approach which is most tax efficient for
current Beverly shareholders.
Subject to the completion of business, regulatory, legal and
accounting due diligence, we are prepared to pay $9.00 per share in cash
for the SNFs (the "Asset Offer Price") and assume all liabilities not
related to the Ancillary Businesses. This alternative would leave Beverly
with a pure-play ancillary company, which we believe would trade at
approximately a valuation of $4.00 per share, in line with public
comparables. Thus, a transaction of this nature could result in a value to
shareholders of $13.00 per share.
As with respect to a transaction whereby we would acquire the entire
Company, we remain prepared to raise the Offer Price accordingly if our due
diligence suggests that there is more value in the Company.
Once again, this expanded proposal is being provided to you on a
confidential basis and we would expect that you will not disclose this
proposal to anyone other than your Board of Directors, legal and financial
advisors. The terms of this letter are intended as an outline of certain
material terms of a proposed transaction, but are not binding on you, the
Company or us and do not include all the material terms, conditions,
covenants, representations, warranties and other provisions that will be
contained in a definitive agreement and other documentation.
We remain prepared to discuss all aspects of this proposal with the
Company, its Board of Directors and its advisors at their earliest
convenience. If you have any questions, please do not hesitate to call me
at (770) 754-9660.
Sincerely,
Formation Capital, LLC
/s/ Arnold M. Whitman
--------------------------
Arnold M. Whitman
Chief Executive Officer
EX-99.G
8
sillstermsheet.txt
Exhibit G
PROJECT SILLS
OPERATING AGREEMENT
SUMMARY TERM SHEET
MEMBERSHIP Appaloosa Management L.P. ("Appaloosa"),
Franklin Mutual Advisers, LLC ("Franklin"),
Formation Capital, LLC ("Formation") and
Eureka Capital Markets, LLC ("Eureka") and
collectively, (the "Members") have determined
to work together with the intent to effect a
transaction whereby they would acquire
control of not less than 80% of the shares of
Sills Enterprises, Inc. ("Sills") or its real
estate assets and SNF operations.
The acquisition will be made through a newly
formed Delaware limited liability company
("Newco"), which will be funded through
equity contributed by Appaloosa, Franklin and
Formation. In addition, Formation and Eureka
will contribute 50% of the financial advisory
fee (see Fees and Expenses) to Newco as Class
A equity.
EQUITY CONTRIBUTION Appaloosa will make an equity contribution to
Newco equal to $150 million. Franklin will
make an equity contribution to Newco equal to
$175 million. Formation will make an equity
contribution to Newco equal to $50 million.
The remaining equity will be raised by the
Members as necessary. All of the Members of
Newco contributing capital will receive Class
A Membership Interests in return for their
capital contributions. The obligation of each
Member to fund their equity contribution
would be conditioned upon mutual agreement of
the Members as to all economic terms of the
transaction, Newco receiving offers to
purchase not less than 80% of the shares of
Sills, the successful conclusion of a merger
agreement or such other transaction as the
Members find acceptable.
Any Member who owns shares of Sills prior to
the commencement of the tender offer or
merger shall contribute such shares to Newco
as part of such Member's equity contribution
at the offer price or merger consideration.
RESTRUCTURING TRANSACTIONS Sills will undertake such restructuring
transactions as will be mutually agreed upon
by the Members.
PURCHASES IN ADVANCE
OF TENDER OR MERGER The Members will disclose to each other all
purchases of shares in Sills prior to the
date of this Term Sheet made by such parties
or any other person that is an investor in,
member of or that could otherwise be
aggregated with such person under SEC rules
(collectively, the "Purchasing Persons"). All
future purchases of shares in Sills to
establish a position shall be coordinated
through Eureka.
CAPITAL DISTRIBUTIONS The real estate entity will distribute cash
to the Members monthly to the extent that
such cash is available for distribution after
satisfying (i) any outstanding payments due
on or under each of the debt financings; and
(ii) any outstanding payments due under the
Asset Management Agreement as defined below.
CLASS A PREFERRED RETURN The Class A Members shall receive an annual
cumulative preferred return of 10% on their
outstanding capital contributions.
CARRIED INTEREST Newco will enter into an Asset Management
contract with Formation. Further, there will
be the issuance of Class B shares which will
provide for a "carried interest" or profit
override. Both agreements will be negotiated
and documented prior to closing. The Carried
Interest will be equal to 16% of the Return
on Capital following the payment to the Class
A Members of the Class A Preferred Return
plus Return of Capital (and 25% of the
returns once the Class A Members have
received a 40% Return on Capital as defined
below). The Carried Interest will be
distributed in the following manner:
Formation will receive 13.5%, and Eureka will
receive 2.5% up to a 40% Return on Capital to
Class A Members and thereafter, Formation
will receive 18.375% and Eureka will receive
6.625%.
RETURN OF CAPITAL Members shall be entitled to receive a return
of their capital upon the happening of a
capital event such as a refinancing or a sale
of substantially all of the real estate
properties.
RETURN ON CAPITAL Return on Capital shall be measured as the
cash on cash return received by Members. If
Members receive shares in a public entity,
the Return on Capital shall be measured as
the six month weighted average trading value
of the shares less a 10% discount following
any lock-up period.
MOST FAVORED NATIONS
PROVISION Class A Members agree that they will be
treated equally from a financial standpoint
except as agreed to in this Term Sheet. Any
and all "Side Operating Agreements" between
Formation and any Class A Member(s) as well
as agreements between Class A Members
themselves, will be fully disclosed.
ASSET MANAGEMENT FEE Pursuant to one or more asset management
agreements, Formation Capital Asset
Management, LLC, or its designee ("FCAM")
will be paid an asset management fee equal to
$15,000 per facility per annum plus
reasonable reimbursement of third party
expenses less $500,000. Third party expenses
will be approved by the Management Committee.
$500,000 per annum for general financial and
legal advisory services to Newco will be
retained by Newco and expended pursuant to
the direction of the Management Committee. To
the extent the amounts expended by Newco for
financial and legal advisory are less than
$500,000 per annum, the difference will be
remitted to Formation.
FEES AND EXPENSES Prior to closing, Appaloosa, Franklin and
Formation will pay all reasonable fees and
expenses relating to the acquisition of Sills
to unaffiliated third parties in an amount
not to exceed $7.0 million ("Pre-Closing
Fees") in proportion to their equity
contribution, provided however, approval of
such Pre-Closing Fees shall be required by
the Members prior to occurrence. At closing,
all fees and expenses will be borne by
Appaloosa, Franklin and Formation in
proportion to their equity contributions.
Projected fees and expenses are scheduled on
Exhibit A. Pre-Closing Fees incurred by Class
A Members will be credited as a capital
contribution to Newco.
Upon closing, a Financial Advisory fee equal
to the lesser of $8.2 million or 0.5% of
Total Consideration whereby Total
Consideration shall be defined as the cash
paid for not less than 80% of the shares of
Sills or its real estate assets and SNF
operations reduced by the value of any
operations or subsidiaries "spun off" to or
returned to shareholders of Sills. The
Financial Advisory fee will be distributed in
the following manner: Formation will receive
37.5% and Eureka will receive 50%. The
remaining 12.5% of the Financial Advisory fee
will be retained by Newco for general working
capital. A minimum of 50% of the financial
advisory fees received by Formation and
Eureka shall be contributed by Formation and
Eureka to Newco in return for Class A
Membership Interests.
BREAK-UP FEE To the extent the Members enter into an
agreement with Sills whereby they are
entitled to a Break-Up Fee, such fee will
first be applied to pay or reimburse the
Class A Members pro rata for Pre-Closing Fees
and after payment of all such fees and
expenses in full, 70% will be distributed to
the Class A Members in proportion to their
equity contribution. The remaining 30% will
be distributed 15% to Eureka and 15% to
Formation.
MANAGEMENT COMMITTEE The Management Committee will initially have
six members. Appaloosa, Franklin and
Formation will each appoint two members. To
the extent substantial additional equity is
contributed to Newco by a party other than
the Members, a maximum of one additional
member may be designated to the Management
Committee provided Members approve such
designation. Four votes will constitute
voting control over those corporate actions
referred to the Management Committee for
approval, which shall include, but not be
limited to:
(i) acquisitions or disposals of assets;
(ii) filing for bankruptcy protection;
(iii) dissolution of Newco;
(iv) appointment of a receiver;
(v) merger of Newco with or into another
Person;
(vi) leasing or renting any property;
(vii) changes in capitalization or the
rights relative to various classes of
shares;
(viii) admission of new members;
(ix) debt incurrence;
(x) changes in the composition of the
Management Committee;
(xi) material modification of business
plans or budgets;
(xii) approval of key management employment
contracts,
(xiii) certain provisions for an exit
covering the sale or an initial
public offering of shares of Newco,
(xiv) material contracts with affiliates of
any Member; and
(xv) changes to the operating agreement.
Formation Capital or its designee shall serve
as the Manager of Newco and shall have
authority to control all day-to-day decisions
of Newco other than matters referred to the
Management Committee.
REMOVAL OF ASSET MANAGER FCAM may be removed at any time as the Asset
Manager by a vote of Members representing 51%
of the capital of Newco. Under a "For Cause"
termination, defined as (i) gross negligence,
willful misconduct or fraud of FCAM or (ii)
insolvency, involuntary reorganization or
bankruptcy of FCAM or Newco, FCAM will
disgorge its Class B shares.
Formation agrees that they will not resign as
Asset Manager without the consent of 75% of
the Class A Members. In the event of such a
voluntary resignation Formation will forfeit
their Class B shares.
In the event of a termination other than "For
Cause" Newco shall pay FCAM a Termination Fee
equal to six months' asset management fees.
In the event of a "For Cause" termination,
Formation would not be entitled to a
Termination Fee.
In the event there is a liquidity occurrence
including, but not limited to a public
offering, refinancing or sale of
substantially all of the real estate
properties at any time, FCAM may be
terminated without cause and will not be
entitled to a termination fee and further, no
party will be entitled to an asset management
fee unless and until agreed to by the board
of directors of the public company.
EXCLUSIVITY Pursuant to a Confidentiality,
Non-Circumvention and Exclusivity Agreement,
the parties shall represent and warrant that
there is no existing agreement,
understanding, letter of intent or other
commitment or arrangement of any kind between
such party and any other person, concerning
the acquisition of the shares or assets of
Sills. Until the later of (i) 90 days; (ii)
the date that the parties agree in writing to
abandon the transactions contemplated hereby;
or (iii) the consummation of the transactions
contemplated hereby:
(i) None of the parties hereto will
directly or indirectly, through any
representative or otherwise, solicit
offers from, or in any manner
encourage any proposal from any other
person relating to the acquisition of
Sills shares or assets, in whole or
in part, whether directly or
indirectly, through purchase, merger,
consolidation or otherwise; and
(ii) Such person will immediately notify
Formation and Eureka regarding any
contact between such person and any
person regarding any such offer,
proposal or related inquiry unless
such person is precluded from doing
so by applicable law or regulation or
other contractual agreement.
CONFIDENTIALITY Except and to the extent required by law,
without the prior consent of the other
parties hereto, none of the parties hereto
will make (and each will direct its
representatives not to make), directly or
indirectly, any public comment, statement or
communication with respect to, or otherwise
disclose or permit the disclosure of the
existence of discussions regarding a possible
transaction in which the parties will
participate or any of the terms, conditions
or other aspects of the transactions proposed
in this letter. If a party is required by law
to make such a disclosure, it must first
provide to the other parties hereto the
content of the proposed disclosure, the
reasons that such disclosure is required by
law and the time and place at which such
disclosure will be made.
NON-CIRCUMVENTION No party shall use any of the information
disclosed in this Term Sheet or otherwise by
the parties hereto for any purpose other than
to evaluate and carry out the transactions
contemplated by this Term Sheet substantially
in accordance with its terms.
IN WITNESS WHEREOF, the parties have executed this Term Sheet as of this
14th day of December, 2004.
APPALOOSA MANAGEMENT L.P.,
on behalf of certain funds for
which it acts as investment adviser
By:/s/ Ronald Goldstein
-------------------------------
Ronald Goldstein
Vice President
EUREKA CAPITAL MARKETS, LLC
By:/s/ Stephen A. Greene
-------------------------------
Stephen A. Greene
Managing Director
FORMATION CAPITAL, LLC
By:/s/ Arnold M. Whitman
-------------------------------
Arnold M. Whitman
Chief Executive Officer
FRANKLIN MUTUAL ADVISERS, LLC
By:/s/ Michael Embler
-------------------------------
Michael Embler
Senior Vice President
EX-99.H
9
dgex99h.txt
Exhibit H
FORMATION CAPITAL, LLC
January 24, 2005
Appaloosa Management, L.P., Northbrook NBV, LLC, on behalf of itself
on behalf of itself and each of and each of Messrs. Hokin, Rubin and Hartman
the Appaloosa Filers, 500 Skokie Blvd, Suite 310
26 Main Street, First Floor Northbrook, IL 60062
Chatham, NJ 07928
Franklin Mutual Advisers, LLC David Reis, as trustee of each of the Reis Trusts,
51 John F. Kennedy Parkway 19 Hilltop Place
Short Hills, NJ 07078 Rye, NY 10580
Baylor Enterprises LLC Arnold M. Whitman David Reis, in his personal
c/o Formation Capital, LLC c/o Formation Capital, LLC capacity
1035 Powers Place 1035 Powers Place 19 Post Road
Alpharetta, GA 30004 Alpharetta, GA 30004 East Westport, CT 06880
Ladies and Gentlemen:
Formation Capital, LLC ("Formation"), Appaloosa Management L.P.
("Appaloosa"), Appaloosa Investment Limited Partnership ("AILP"), Palomino
Fund Ltd. ("Palomino"), Appaloosa Partners Inc. ("API"), David A. Tepper
(Mr. Tepper, together with Appaloosa, AILP, Palomino, and API, the
"Appaloosa Filers"), Franklin Mutual Advisers, LLC ("Franklin"), Northbrook
NBV, LLC ("Northbrook"), David Hokin, Rob Rubin, Robert Hartman, David
Reis, in his personal capacity and in his capacity as trustee of each of
the Reis Trusts, the 1995 David Reis Family Trust ("1995 DRF Trust"), the
1995 Donna Reis Family Trust ("Donna Trust"), the Aaron Reis Spray Trust
("Aaron Trust"), the Anna Reis Spray Trust ("Anna Trust"), the Alexander
Reis Spray Trust ("Alexander Trust") and the David Reis Family Trust ("DRF
Trust"), Baylor Enterprises LLC ("Baylor") and Arnold M. Whitman
(collectively, the "Filing Persons") are considering making a joint
proposal to acquire, through an entity ("Newco") to be formed by Formation
and/or its affiliates, all of the outstanding shares of capital stock of
Beverly Enterprises, Inc. (the "Company"). In that connection, each Filing
Person acknowledges and agrees that it and its affiliates may be deemed to
have formed a "group" (within the meaning of Section 13(d)(3) of the
Securities Exchange Act of 1934 (the "Exchange Act")) with the other Filing
Persons and their affiliates for the purpose of acquiring shares of common
stock, par value $.10 per share, of the Company ("Company Common Stock").
In order to ensure that each of the Filing Persons and its affiliates have
available to them on a timely basis all information required to be included
in a Schedule 13D (including amendments thereto) required to be filed by
such Filing Person and its affiliates, the Filing Persons hereby agree as
follows:
1. Each of the Filing Persons represents and warrants to each of
the other Filing Persons that as of the date hereof it beneficially owns
(within the meaning of Section 13(d)(3) of the Exchange Act) the securities
of the Company listed above its name on the signature page hereto.
2. Each of the Filing Persons will timely provide to the other
Filing Persons all information with respect to such Filing Person and its
affiliates (or, with respect to such Filing Person and its affiliates, any
of the persons enumerated in Instruction C to Schedule 13D) required to be
included by the other Filing Person in any Schedule 13D or amendment
thereto required to be filed by them with respect to the Company Common
Stock. Without limiting the generality of the foregoing, if on any day, a
Filing Person or any of its affiliates (or, with respect to such Filing
Person and its affiliates, any of the persons enumerated in Instruction C
to Schedule 13D) effects any purchase or sale of shares of Company Common
Stock, such Filing Persons shall promptly (but in any event within one
business day) notify the other Filing Persons of (i) the identity of the
entity that effected the transaction and the identity of such entities that
have sole or shared power to vote and/or dispose of such shares and/or any
entities entitled to or having the power to receive the proceeds from the
sale of such shares, (ii) the date of the transaction, (iii) the number of
shares purchased and/or sold, (iv) the price paid or received per share
purchased or sold and (v) where and how the transaction was effected.
3. Each of the Filing Persons shall promptly (but in any event
within one business day) provide to the other Filing Persons a copy of any
written agreement, contract, arrangement, understanding, plan or proposal,
entered into by it or any of its affiliates (or, with respect to such
Filing Person and its affiliates, any of the persons enumerated in
Instruction C to Schedule 13D) that is required to be disclosed under Item
7 of Schedule 13D.
4. The terms of this letter agreement shall be binding upon each
of the Filing Persons; provided that any Filing Person may withdraw as a
party to this letter agreement (and shall thereafter not be required to
comply with the terms hereof) by delivering to the other Filing Persons a
written statement certifying that such Filing Person and its affiliates
have no further agreement, arrangement or understanding with the other
Filing Persons and their respective affiliates with respect to the
acquiring, holding, voting or disposing of shares of Company Common Stock.
No such withdrawal by a Filing Person shall relieve it from liability for
any breach by such Filing Person of this letter agreement occurring prior
to such withdrawal.
5. Each Filing Person (the "Indemnifying Party") hereby agrees to
indemnify, defend and hold harmless each of the other Filing Persons and
their respective directors, officers, employees, agents, advisors,
consultants, representatives, affiliates, successors and assigns (each an
"Indemnified Party") from and against any and all losses, liabilities,
obligations, payments, claims, damages, charges, taxes, judgments, fines,
penalties, amounts paid in settlement, costs and expenses (including
interest which may be imposed in connection therewith, costs and expenses
of investigation and fees, expenses and disbursements of counsel,
consultants and other experts) sustained, incurred or suffered by or
asserted against any Indemnified Party in respect of (i) any breach of the
Indemnifying Party's representations and warranties contained in this
letter agreement, (ii) the Indemnifying Party's failure to perform or
otherwise fulfill any of its agreements, covenants, obligations or
undertakings hereunder or (iii) any breach of the Indemnifying Party's
certifications, representations or warranties contained in any written
statement delivered by such Indemnifying Party pursuant to this Letter
Agreement. Notwithstanding any other provision of this letter agreement,
the terms of this Section 5 shall survive and be binding upon each Filing
Person until the fifth anniversary of the date such Filing Person withdraws
as a party to this letter agreement by complying with the provisions of
Section 4 hereof.
6. This letter agreement shall be governed by the laws of the
State of New York, without regard for the conflicts of law principles
thereof.
[signature page follows]
Please confirm your agreement with the foregoing by executing and
returning a copy of this letter to us.
Dated: January 24, 2005
FORMATION CAPITAL, LLC
By: /s/ Arnold M. Whitman
------------------------------------
Name: Arnold M. Whitman
Title: Chief Executive Officer
ACCEPTED AND AGREED:
Holder of 1,873,122 shares of Company Common Stock:
APPALOOSA INVESTMENT LIMITED PARTNERSHIP I
By: APPALOOSA MANAGEMENT L.P.,
Its General Partner
By: APPALOOSA PARTNERS INC.,
Its General Partner
By: /s/ David A. Tepper
-----------------------------------
Name: David A. Tepper
Title: President
Holder of 1,641,178 shares of Company Common Stock:
PALOMINO FUND LTD.
By: APPALOOSA MANAGEMENT L.P.,
Its Investment Adviser
By: APPALOOSA PARTNERS INC.,
Its General Partner
By: /s/ David A. Tepper
-----------------------------------
Name: David A. Tepper
Title: President
Holder of 3,514,300 shares of Company Common Stock:
APPALOOSA MANAGEMENT L.P.
By: APPALOOSA PARTNERS INC.,
Its General Partner
By: /s/ David A. Tepper
---------------------------
Name: David A. Tepper
Title: President
Holder of 3,514,300 shares of Company Common Stock:
APPALOOSA PARTNERS INC.
By: /s/ David A. Tepper
------------------------
Name: David A. Tepper
Title: President
Holder of 3,514,300 shares of Company Common Stock:
/s/ David A. Tepper
-------------------------------
DAVID A. TEPPER
Holder of 3,508,900 shares of Company Common Stock:
FRANKLIN MUTUAL ADVISERS, LLC
By: /s/ David J. Winters
---------------------------
Name: David J. Winters
Title: President, Chief Executive Officer and Chief Investment Officer
Holder of 1,487,200 shares of Company Common Stock:
NORTHBROOK NBV, LLC
By: /s/ Rob Rubin
--------------------------
Name: Rob Rubin
Title: Manager
Holder of 1,487,200 shares of Company Common Stock:
/s/ David Hokin
-------------------------------
DAVID HOKIN
Holder of 1,487,200 shares of Company Common Stock:
/s/ Rob Rubin
-------------------------------
ROB RUBIN
Holder of 1,487,200 shares of Company Common Stock:
/s/ Robert Hartman
-------------------------------
ROBERT HARTMAN
Holder of 10,000 shares of Company Common Stock:
1995 DAVID REIS FAMILY TRUST
By: /s/ David Reis
--------------------------
Name: David Reis
Title: Trustee
Holder of 25,000 shares of Company Common Stock:
1995 DONNA REIS FAMILY TRUST
By: /s/ David Reis
--------------------------
Name: David Reis
Title: Trustee
Holder of 20,000 shares of Company Common Stock:
AARON REIS SPRAY TRUST
By: /s/ David Reis
--------------------------
Name: David Reis
Title: Trustee
Holder of 22,500 shares of Company Common Stock:
ANNA REIS SPRAY TRUST
By: /s/ David Reis
--------------------------
Name: David Reis
Title: Trustee
Holder of 22,500 shares of Company Common Stock:
ALEXANDER REIS SPRAY TRUST
By: /s/ David Reis
--------------------------
Name: David Reis
Title: Trustee
Holder of 22,500 shares of Company Common Stock:
DAVID REIS FAMILY TRUST
By: /s/ David Reis
--------------------------
Name: David Reis
Title: Trustee
Holder of 20,000 shares of Company Common Stock:
/s/ David Reis
--------------------------------
DAVID REIS
Holder of 22,000 shares of Company Common Stock:
BAYLOR ENTERPRISES LLC
By: /s/ Arnold M. Whitman
--------------------------
Name: Arnold M. Whitman
Title: Managing Member
Holder of 26,500 shares of Company Common Stock:
/s/ Arnold M. Whitman
-------------------------
ARNOLD M. WHITMAN