0000895345-05-000135.txt : 20120705 0000895345-05-000135.hdr.sgml : 20120704 20050204155452 ACCESSION NUMBER: 0000895345-05-000135 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 20050204 DATE AS OF CHANGE: 20050204 GROUP MEMBERS: 1995 DAVID REIS FAMILY TRUST GROUP MEMBERS: 1995 DONNA REIS FAMILY TRUST GROUP MEMBERS: AARON REIS SPRAY TRUST GROUP MEMBERS: ALEXANDER REIS SPRAY TRUST GROUP MEMBERS: ANNA REIS SPRAY TRUST GROUP MEMBERS: APPALOOSA INVESTMENT LIMITED PARTNERSHIP I GROUP MEMBERS: APPALOOSA MANAGEMENT L.P. GROUP MEMBERS: APPALOOSA PARTNERS INC. GROUP MEMBERS: ARNOLD M. WHITMAN GROUP MEMBERS: BAYLOR ENTERPRISES LLC GROUP MEMBERS: DAVID A. TEPPER GROUP MEMBERS: DAVID HOKIN GROUP MEMBERS: DAVID REIS GROUP MEMBERS: DAVID REIS FAMILY TRUST GROUP MEMBERS: FRANKLIN MUTUAL ADVISERS, LLC GROUP MEMBERS: NORTHBROOK NBV, LLC GROUP MEMBERS: PALOMINO FUND LTD. GROUP MEMBERS: ROB RUBIN GROUP MEMBERS: ROBERT HARTMAN 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/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-52627 FILM NUMBER: 05577226 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/A 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/A 1 pr13da3.txt SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 Schedule 13D/A (Amendment No. 3) Under the Securities Exchange Act of 1934 Beverly Enterprises, Inc. ----------------------------------------- (Name of Issuer) Common Stock, $0.10 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) February 3, 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 42 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 42 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 42 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 42 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 42 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 42 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 42 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 42 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 42 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 42 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 42 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 OO CUSIP NO. 087851309 13D PAGE 13 OF 42 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 42 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 42 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 42 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 42 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 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 18 OF 42 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[1] BENEFICIALLY 8 SHARED VOTING POWER OWNED BY 125,000 EACH 9 SOLE DISPOSITIVE POWER REPORTING 95,000[1] 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 ----------------- [1] Includes 20,000 Beverly Enterprises Shares which may be purchased pursuant to currently exercisable call options. CUSIP NO. 087851309 13D PAGE 19 OF 42 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 21,900 EACH 9 SOLE DISPOSITIVE POWER REPORTING -0- PERSON 10 SHARED DISPOSITIVE POWER WITH 21,900 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON 21,900 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) Less than 1.0% TYPE OF REPORTING PERSON 14 OO CUSIP NO. 087851309 13D PAGE 20 OF 42 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 4,700 BENEFICIALLY 8 SHARED VOTING POWER OWNED BY 21,900 EACH 9 SOLE DISPOSITIVE POWER REPORTING 4,700 PERSON 10 SHARED DISPOSITIVE POWER WITH 21,900 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY REPORTING PERSON 26,600 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 This Amendment No. 3 amends the Schedule 13D originally filed on January 24, 2005, as amended by Amendment No. 1 filed on January 25, 2005 and by Amendment No. 2 filed on January 27, 2005 (as amended, the "Statement"), by (i) Appaloosa Investment Limited Partnership I, (ii) Palomino Fund Ltd., (iii) Appaloosa Management L.P., (iv) Appaloosa Partners, Inc., (v) David A. Tepper, (vi) Franklin Mutual Advisers, LLC, (vii) Northbrook NBV, LLC, (viii) David Hokin, (ix) Rob Rubin, (x) Robert Hartman, (xi) 1995 David Reis Family Trust, (xii) 1995 Donna Reis Family Trust, (xiii) Aaron Reis Spray Trust, (xiv) Anna Reis Spray Trust, (xv) Alexander Reis Spray Trust, (xvi) David Reis Family Trust, (xvii) David Reis, (xviii) Baylor Enterprises LLC and (xix) Arnold Whitman, relating to the common stock, $0.10 par value per share, of Beverly Enterprises, Inc. Unless otherwise indicated, all capitalized terms used herein shall have the meanings given to them in the Statement, and unless amended hereby, all information previously filed remains in effect. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION Item No. 3 is hereby supplemented by the following: Mr. Whitman purchased an additional 100 Beverly Enterprises Shares in a market transaction on January 28, 2005 for an aggregate amount of $1,197, using his personal funds, and acquired an additional 100 Beverly Enterprises Shares on February 1, 2005 through a transfer from Baylor. ITEM 4. PURPOSE OF TRANSACTION Item No. 4 is hereby supplemented by the following: On February 3, 2005, Arnold M. Whitman, Chief Executive Officer of Formation, sent to William R. Floyd, Chairman of the Board, President and Chief Executive Officer of the Company, a letter on behalf of the Consortium Members. As indicated in the letter, the Consortium Members intend to nominate a slate of nominees for election to the Company's Board of Directors at the Company's 2005 annual meeting of stockholders. This letter is included in the press release attached as Exhibit J. On February 4, 2005, Mr. Whitman submitted to the Secretary of the Company a notice of the business and proposals he intends to bring before the Company's 2005 annual meeting of stockholders. As indicated in the notice, Mr. Whitman intends to nominate for election to the Board of Directors of the Company a slate consisting of the following nominees: Jeffrey A. Brodsky, John J. Durso, Philip L. Maslowe, Charles M. Masson, Mohsin Y. Meghji and Guy Sansone. Information about each of the nominees is contained in the notice, which is attached hereto as Exhibit K and incorporated herein by reference. The identity of each person who may be deemed to be a participant in the solicitation (as defined in Instruction 3 to Item 4 of Schedule 14A (ss.240.14a-101 of the Securities Exchange Act of 1934, as amended)) of the Company's stockholders in connection with the Company's 2005 annual meeting of stockholders and a description of such person's direct or indirect interests in the solicitation, to the extent not otherwise described in the Statement, is set forth on attached Exhibit L hereto. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER The first sentence in paragraph (a) of Item 5 is amended and restated in its entirety as follows: The Filing Persons beneficially own, as defined in Rule 13d-3 under the Securities Exchange Act of 1934 (the "1934 Act"), 8,757,000 Beverly Enterprises Shares in the aggregate. Clauses (xiii) through (xv) in Item 5(a) and the last paragraph in Item 5(a) are amended and restated in their entirety as follows: (xiii) Baylor is the owner of 21,900 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 4,700 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 26,600 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 4,700 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 21,900 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 1,733,800 Beverly Enterprises Shares (or 1.6% 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 Agreement among Stockholders, 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 8,757,000 Beverly Enterprises Shares reported herein. The last sentence of Item 5(b) is amended and restated in its entirety as follows: 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 21,900 Beverly Enterprises Shares held by Baylor, and Mr. Whitman has the sole power to vote and direct the disposition of 4,700 Beverly Enterprises Shares held by himself. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS 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 Stockholders dated January 24, 2005.+ I. Letter dated January 27, 2005 from Fried, Frank, Harris, Shriver & Jacobson LLP to Douglas J. Babb, Executive Vice President, Chief Administrative and Legal Officer of the Company.** J. Press Release issued on February 3, 2005 (including Letter dated February 3, 2005 from Mr. Whitman to Mr. Floyd).*** K. Notice of Business and Proposals to be Brought before the 2005 Annual Meeting of Stockholders.*** L. List of Participants in Solicitation of Company Stockholders.*** -------------------------------- * Filed on January 24, 2005 + Filed with Amendment No. 1 on January 25, 2005 ** Filed with Amendment No. 2 on January 27, 2005 *** Filed herewith 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: February 4, 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 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: February 4, 2005 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 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: February 4, 2005 APPALOOSA MANAGEMENT L.P. By: Appaloosa Partners Inc., its General Partner By: /s/ David A. Tepper ------------------------- 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: February 4, 2005 APPALOOSA PARTNERS INC. By: /s/ David A. Tepper ------------------------- 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: February 4, 2005 /s/ David A. Tepper ------------------------------- 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: February 4, 2005 FRANKLIN MUTUAL ADVISERS, LLC By: /s/ David J. Winters ------------------------ 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: February 4, 2005 NORTHBROOK NBV, LLC By: /s/ Rob Rubin ------------------------ Name: Rob Rubin Title: Manager 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: February 4, 2005 /a/ David Hokin ------------------------------- 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: February 4, 2005 /s/ Rob Rubin ------------------------------- 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: February 4, 2005 /s/ Robert Hartman ------------------------------- 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: February 4, 2005 1995 DAVID REIS FAMILY TRUST By: /s/ David Reis ------------------------------- 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: February 4, 2005 1995 DONNA REIS FAMILY TRUST By: /s/ David Reis ------------------------------- 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: February 4, 2005 AARON REIS SPRAY TRUST By: /s/ David Reis ------------------------------- 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: February 4, 2005 ANNA REIS SPRAY TRUST By: /s/ David Reis ------------------------------- 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: February 4, 2005 ALEXANDER REIS SPRAY TRUST By: /s/ David Reis ------------------------------- 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: February 4, 2005 DAVID REIS FAMILY TRUST By: /s/ David Reis ------------------------------- 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: February 4, 2005 /S/ David Reis ------------------------------- 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: February 4, 2005 BAYLOR ENTERPRISES LLC By: /s/ Arnold M. Whitman --------------------------- 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: February 4, 2005 /s/ Arnold M. Whitman ------------------------------- 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 Stockholders dated January 24, 2005.+ I. Letter dated January 27, 2005 from Fried, Frank, Harris, Shriver & Jacobson LLP to the Company.** J. Press Release issued on February 3, 2005 (including Letter dated February 3, 2005 from Mr. Whitman to Mr. Floyd).*** K. Notice of Business and Proposals to be Brought before the 2005 Annual Meeting of Stockholders.*** L. List of Participants in Solicitation of Company Stockholders.*** -------------------------------- * Filed on January 24, 2005 + Filed with Amendment No. 1 on January 25, 2005 ** Filed with Amendment No. 2 on January 27, 2005 *** Filed herewith EX-99 2 exhi99_3.txt EXHIBIT C 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 Footnote [1] December 1, 2004 2,000 Sell $9.147 Footnote [1] December 1, 2004 300[2] Sell $0.853 Footnote [1] December 2, 2004 17,000 Sell $9.292 Footnote [1] December 3, 2004 10,000 Buy $9.153 Footnote [1] December 6, 2004 14,000 Buy $8.909 Footnote [1] December 7, 2004 15,000 Buy $8.754 Footnote [1] December 8, 2004 3,000[2] Sell $0.74 Footnote [1] December 9, 2004 1,000[2] Sell $0.8235 Footnote [1] December 10, 2004 1,000[2] Sell $0.723 Footnote [1] December 13, 2004 1,000[2] Sell $0.773 Footnote [1] December 15, 2004 1,000[2] Sell $0.523 Footnote [1] December 17, 2004 1,000 Sell $8.98 Footnote [1] December 17, 2004 1,000[2] Sell $0.774 Footnote [1] December 20, 2004 1,000 Buy $8.81 Footnote [1] December 20, 2004 300[2] Sell $0.752 Footnote [1] December 21, 2004 1,000[2] Sell $0.773 Footnote [1] January 12, 2005 5,000 Sell $8.747 Footnote [1] January 13, 2005 5,000 Buy $8.653 Northbrook[3] January 13, 2005 750,000 Buy $8.60 Footnotes[1],[3] January 13, 2005 750,000 Sell $8.60 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 Footnote [1] January 19, 2005 1,000[2] Sell $0.8735 Northbrook January 20, 2005 130,800 Buy $9.6044 Footnote [1] 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 20,000[4] Buy $0.7205 BAYLOR December 20, 2004 22,000 Buy $9.001 ENTERPRISES (excluding LLC commissions) February 1, 2005 100 Transfer[5] $0 ARNOLD M. December 20, 2004 1,100 Buy $8.98 WHITMAN December 20, 2004 3,400 Buy $8.99 January 28, 2005 100 Buy $11.97 (excluding commissions) February 1, 2005 100 Transfer[5] $0 ------------------- [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 Beverly Enterprises Shares 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 Beverly Enterprises Shares at a strike price of $10.00. [5] These shares were transferred from Baylor to Arnold M. Whitman. EX-99 3 exhi99_10.txt EXHIBIT J FOR IMMEDIATE RELEASE --------------------- CONTACTS: MEDIA: Jim Barron/Debbie Miller Citigate Sard Verbinnen (212) 687-8080 INVESTORS & ANALYSTS: MacKenzie Partners, Inc. Larry Dennedy 212-929-5239 Bob Marese 212-929-5405 Dan Burch 212-929-5748 FORMATION CAPITAL GROUP ANNOUNCES INTENTION TO NOMINATE SLATE OF INDEPENDENT DIRECTORS FOR BOARD OF BEVERLY ENTERPRISES INC. BELIEVES BEVERLY SHAREHOLDERS SHOULD ELECT NEW BOARD TO MAXIMIZE VALUE OF THEIR INVESTMENT ALPHARETTA, GA, FEBRUARY 3, 2005 - Formation Capital LLC and its associates Appaloosa Management L.P. and Franklin Mutual Advisers, LLC today announced their intention to nominate a slate of directors to the Board of Beverly Enterprises by the Company's February 5th deadline. Formation Capital also disclosed that the following letter has been sent from Arnold M. Whitman, CEO of Formation LLC to William R. Floyd, CEO of Beverly: February 3, 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: I write on behalf of Formation Capital, LLC and my associates at Appaloosa Management L.P. and Franklin Mutual Advisers, LLC to express disappointment at the letter you sent to us earlier today. Your letter - similar to your letter of January 27, 2005 -- is disingenuous and misleading, and it underscores your entrenched position and attempt to thwart a very attractive proposal that will benefit your Company and all of its shareholders. We note in particular that you have raised spurious questions about our financing capabilities, which you have never even bothered to discuss with us. We have $375 million of committed equity and numerous expressions of interest from financial institutions willing to commit to debt financing. There is no question about our ability to finance our proposals. We would also note that, with regard to your comments about patient care, patient care has always been important to Formation. Indeed, at the facilities we bought from you in 2002, patient care metrics actually improved after the transaction, as did financial performance. To be clear, and as stated in previous letters, our initial proposal would offer Beverly shareholders $11.50 per share in cash. This translates into a premium of 46% to the average closing price for the Company's stock over the period from the beginning of 2004 through January 24, 2005, the last trading day before the announcement of our proposals. Indeed, before we announced our proposals, your Company's stock had not closed above $10.00 since October 2001. We are also prepared (as outlined in our letter of January 19, 2005), to undertake a transaction whereby we would purchase Beverly's real estate assets and nursing facilities operations only ($9.00 per share in cash for the SNFs), and to consider entering into contractual agreements whereby Beverly would continue to provide ancillary services to the nursing facilities we purchase. This alternative would leave Beverly with a pure play ancillary services company, which we believe would trade at an approximate 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. WE HAVE SAID CONSISTENTLY THAT, IF JUSTIFIED BY DUE DILIGENCE, WE WOULD BE PREPARED TO RAISE OUR OFFERS AND REVISE OUR PROPOSALS. Since we made our first approach to you over six weeks ago -- putting our proposals in writing as you requested -- you have avoided any dialogue and worked behind the scenes to impede any fair consideration of our offer, including accelerating the Company's 2005 annual meeting date and deadline for submitting proposals and nominees, and adopting an aggressive poison pill. Moreover, while your public announcement to investors attributed the change to your annual meeting date to a policy you purportedly adopted "to hold the Company's Annual Meeting of Stockholders as early as practicable in each calendar year," according to an article by Cristal Cody in the Arkansas Democrat-Gazette, during a January 26th conference call with your employees, you revealed your true motivations: [MOVING THE SHAREHOLDER MEETING] "SHORT-CIRCUITS THE FORMATION CAPITAL FINANCIAL GROUP...." FLOYD SAID. "IF THEY WANTED TO PUT THEIR DIRECTORS UP FOR ELECTION, BY MOVING UP THE MEETING, IT WOULD ELIMINATE SOME OF THE TIME THEY WOULD HAVE TO PREPARE." Your willingness to manipulate the corporate machinery to block our proposal without even a cursory meeting with us to discuss its merits reveals the length to which you and your board are prepared to go to sacrifice the interests of your shareholders. Although we continue to prefer pursuing a negotiated transaction with the Company, your actions have left us no choice but to nominate a slate of directors for election at your upcoming annual meeting. Accordingly, we will submit tomorrow, February 4, 2005, a slate of independent, highly qualified nominees for election to the Beverly board. Our nominees, if elected, will, subject to their fiduciary duties, be committed to going forward with a process that would give due consideration to our offer as well as any other proposals the Company may receive. We are firmly convinced that pursuing our proposal would maximize value for your shareholders and, at the same time, ensure high quality care for patients. As you know, Formation Capital has focused on the health care industry, providing equity to the senior housing and long-term care industry, since we were founded in 1999. We believe that creating value for shareholders can only happen when high quality patient care comes first. Currently, Formation manages assets in excess of $650 million in value. Over the last three years, Formation and its partners have acquired an ownership interest in 152 facilities in 20 states, including 49 skilled nursing facilities and four assisted living centers we bought from Beverly in 2002. Again, as we noted above, while you imply in your letter that patient care might suffer in a transaction with us, we are prepared to stand on the record. While we regret that we are forced to proceed in this manner directly to the owners of Beverly, we remain open to a constructive dialogue. As noted in my previous letters, 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 modest number of 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. I urge you or your advisors to contact me at (770) 754-9600 to discuss an appropriate process for achieving a negotiated agreement. Sincerely, Arnold M. Whitman Chief Executive Officer Cc: BEVERLY BOARD OF DIRECTORS Melanie Creagan Dreher, Ph.D., RN, FAAN John D. Fowler Jr. John P. Howe III, M.D. James W. McLane Ivan R. Sabel Donald L. Seeley Marilyn R. Seymann, Ph.D. IMPORTANT INFORMATION Arnold Whitman and certain other persons may be deemed to be "participants in the solicitation" (as defined in Instruction 3 to Item 4 of Schedule 14A of the Securities and Exchange Act of 1934, as amended) of the stockholders of Beverly Enterprises in connection with the Company's 2005 annual meeting of stockholders. A list of these persons will be included in Exhibit L to Amendment # 3 to a Schedule 13D filed with the Securities and Exchange Commission (SEC) with respect to the common stock of Beverly Enterprises by Mr. Whitman, Appaloosa Management L.P., Franklin Mutual Advisers, LLC. A description of the interests in solicitation of these persons is contained in the Schedule 13D as amended, including in Exhibit L. The Schedule 13D was originally filed with the SEC on January 24, 2005. Exhibit L is included in Amendment No. 3 to be filed with the SEC on February 4, 2005. Mr. Whitman intends to file a proxy statement with the SEC for the solicitation of the stockholders of Beverly Enterprises in connection with the Company's 2005 annual meeting of stockholders. Security holders of Beverly Enterprises are urged to read the proxy statement and any other proxy solicitation materials filed by Mr. Whitman (when they become available) because they will contain important information. Investors will be able to obtain a free copy of the proxy statement and other documents filed by Mr. Whitman with the SEC (when they become available) at the SEC's website at www.sec.gov. Investors will also be able to obtain a free copy of the proxy statement and these other documents (when they become available) by contacting MacKenzie Partners, Inc., the proxy solicitor retained in connection with the solicitation, at (212) 929-5500 (call collect) or (800) 322-2885 (call toll-free). Consent has not been sought or obtained for the use of as proxy-soliciting material of previously published material reproduced in this document. ### EX-99 4 exhi99_11.txt EXHIBIT K ARNOLD M. WHITMAN c/o Formation Capital, LLC 1035 Powers Place Alpharetta, GA 30004 VIA FACSIMILE AND HAND DELIVERY February 4, 2005 Beverly Enterprises, Inc. One Thousand Beverly Way Fort Smith, Arkansas 72919 Attention: Secretary Re: Notice of Business and Proposals to be Brought before the 2005 Annual Meeting of Stockholders Dear Sir or Madam: Pursuant to and in accordance with the requirements of Sections 15 and 16 of Article II of the By-Laws of Beverly Enterprises, Inc. (the "Company"), the undersigned (the "Stockholder") hereby furnishes notice of the Stockholder's intention (i) to bring before the Company's 2005 Annual Meeting of Stockholders, or any other meeting of Stockholders held in lieu thereof (including any adjournments, postponements, reschedulings or continuations thereof, the "Annual Meeting"), the business and proposals described below and (ii) to nominate for election to the Company's board of directors at the Annual Meeting the persons named below. Business and Proposals The Stockholder intends to bring the following business and proposals before the Annual Meeting for consideration and action by the Company's stockholders in the sequence indicated and before any other business is conducted: PROPOSAL 1: To amend the Company's By-Laws to fix the number of directors constituting the entire Board of Directors at eight, by revising Article III, Section 2 of the Company's By-Laws to read in its entirety as set forth in Exhibit A. PROPOSAL 2: To repeal each provision of or amendment to the Company's By-Laws (other than the provisions and amendments added or effected pursuant to Proposal 1) adopted after the version of the By-Laws, purportedly as of May 29, 1997, filed by the Company with the Securities and Exchange Commission as Exhibit 3.4 to the Company's Registration Statement on Form S-1 filed on June 4, 1997 (File No. 333-28521). PROPOSAL 3: To elect each of the Nominees referred to below to the Company's Board of Directors, in lieu of any persons who may be nominated by the Company's incumbent Board of Directors or by any other person. PROPOSAL 4: To require that action be taken at the Annual Meeting on proposals 1 through 3 above in the sequence indicated and before any other business is conducted. Information in Support of Director Nominations The Stockholder intends to nominate each of the following persons (the "Nominees") for election as a director of the Company: Jeffrey A. Brodsky John J. Durso Philip L. Maslowe Charles M. Masson Mohsin Y. Meghji Guy Sansone Annex I to this notice presents as to each Nominee: (a) the name and business address and residence address of that person; and (b) such other information regarding that person as would be required to be included in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had the Nominee been nominated, or intended to be nominated, by the Board of Directors of the Company. Each of the Nominees named in Annex I has consented to being named in the proxy statement filed or distributed on behalf of the stockholder in connection with the solicitation of proxies for the proposals described above and to serve as a director of the Company if elected pursuant to that solicitation. Each of the consents executed by the Nominees is attached hereto as Exhibit B and incorporated herein by reference. Appaloosa Management, L.P. ("Appaloosa Management"), on behalf of certain funds for which it acts as investment adviser, Franklin Mutual Advisers, LLC ("Franklin Mutual"), on behalf of certain funds for which it acts as investment adviser, and Formation Capital, LLC ("Formation," together with Appaloosa Management and Franklin Mutual, the "Indemnitors") entered into an agreement with each of the Nominees (the "Indemnification Agreement"). The Stockholder is the Chief Executive Officer, Treasurer and Co-Chairman of Formation. The Indemnification Agreement provides that the Indemnitors will indemnify each Nominee against any and all damages, judgments, fines, penalties, losses and expenses ("Losses") suffered, incurred or sustained by such Nominee or to which such Nominee becomes subject, resulting from, arising out of or relating to a claim by reason of (a) the Nominee's being a nominee for election to the Company's Board of Directors at the Annual Meeting or (b) any event or occurrence relating to or arising out of, or any action taken or omitted to be taken in connection with the solicitation of proxies from the stockholders of the Company in support of the Nominee's election as a director of the Company at the Annual Meeting. Under each Indemnification Agreement, responsibility for payments or Losses for which the Indemnitors are liable thereunder is allocated 40% to Appaloosa, 46.67% to Franklin Mutual and 13.33% to Formation, and each Indemnitor's liability under the Indemnification Agreement is limited to 40%, 46.67% and 13.33%, respectively, of $25,000,000. This description of the Indemnification Agreement is qualified in its entirety by reference to the Indemnification Agreement, which is attached hereto as Exhibit C and incorporated herein by reference. If this notice shall be deemed for any reason by a court of competent jurisdiction to be ineffective with respect to the nomination of any individual Nominee at the Annual Meeting, or if any individual Nominee shall be unable or unwilling to stand for election to the Board of Directors of the Company for any reason, the Stockholder reserves the right to designate a substitute Nominee and this notice shall continue to be effective with respect to the remaining Nominees and as to any substitute Nominees selected by the Stockholder. Information Regarding the Stockholder The name and address of the Stockholder, as the Stockholder believes it appears on the Company's books, is Arnold Whitman, 1035 Powers Place, Alpharetta, GA 30004. The address of the Stockholder is c/o Formation Capital LLC, 1035 Powers Place, Alpharetta, GA 30004. The Stockholder hereby represents that he is a holder of record of stock of the Company entitled to vote for the election of directors on the date hereof and that he intends to appear in person or by proxy at the Annual Meeting to nominate the Nominees and to present the proposals set forth in this letter. As of the date of this letter, the Stockholder is a holder of record of 100 shares of the Company's stock, and the beneficial owner of 4,700 shares of the Company's common stock (including the 100 shares held of record). The Stockholder may also be the beneficial owner of 21,900 shares of the Company's common stock owned by Baylor Enterprises LLC ("Baylor") of which the Stockholder is the controlling member. The Stockholder may also be deemed to be the beneficial owner of shares of the Company's common stock beneficially owned by (i) Appaloosa Investment Limited Partnership I, (ii) Palomino Fund Ltd., (iii) Appaloosa Management, (iv) Appaloosa Partners, Inc., (v) David A. Tepper, (vi) Franklin Mutual Advisers, LLC, (vii) Northbrook NBV, LLC, (viii) David Hokin, (ix) Rob Rubin, (x) Robert Hartman, (xi) 1995 David Reis Family Trust, (xii) 1995 Donna Reis Family Trust, (xiii) Aaron Reis Spray Trust, (xiv) Anna Reis Spray Trust, (xv) Alexander Reis Spray Trust, (xvi) David Reis Family Trust, and (xvii) David Reis (the persons listed in clauses (i) through (xvii), together with the Stockholder and Baylor, the "13D Filers"). To the knowledge of the Stockholder, as of the date of this letter, the 13D Filers beneficially own, in the aggregate, 8,730,400 shares of common stock of the Company (not including the 4,700 shares owned by the Stockholder and the 21,900 shares owned by Baylor as described above). Purpose of Proposals The 13D Filers are interested in exploring the possibility of a negotiated transaction (the "Proposed Transaction") with the Company that would involve acquiring control of the Company or purchasing its real estate assets and nursing facilities operations (the "SNF's"). In connection therewith, on December 14, 2004, Appaloosa Management, Eureka Capital Markets, LLC ("Eureka"), Formation and Franklin Mutual executed a term sheet setting forth terms on which they would work together to effect a transaction acquiring the outstanding shares of the Company or the Company's real estate assets and SNF's. 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 Management $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 Appaloosa Management, Franklin Mutual and Formation. The description of this term sheet is qualified in its entirety by reference to the term sheet, which is attached hereto as Exhibit D and incorporated herein by reference. On December 22, 2004, Formation sent a letter to William R. Floyd, the Chairman of the Board, President and Chief Executive Officer of the Company, offering to acquire the issued and outstanding shares of the Company at a price of $11.50 per share in cash, subject to the terms and conditions set forth in the letter. The letter stated that Formation is prepared to immediately commence due diligence review of the Company, and if due diligence suggests that there is more value in the Company, Formation would be prepared to raise its offer price accordingly. The letter also indicated that Formation is prepared to discuss a transaction whereby Formation would purchase the Company's real estate assets and SNF's. On January 19, 2005, Formation expanded on its proposals as initially set forth in the December 22 letter in a letter to the Company. On February 3, 2004, the Company rejected Formation's proposals without engaging in any discussion with Formation regarding its proposals or permitting Formation to conduct due diligence. The purpose of the proposals described above is to replace a majority of the Company's directors with directors who will, subject to their fiduciary duties, be committed to proceeding with a process that would give due consideration to proposals made by Formation as well as any other proposals the Company may receive from Formation or others with respect to a sale of the Company or its assets ("Other Proposals"). As a stockholder of the Company and as the Chief Executive Officer, Treasurer and Co-Chairman of Formation, the Stockholder's interest in the business he intends to bring before the Annual Meeting rests in electing directors committed to proceeding with a process that would give due consideration to the proposals made by Formation and any Other Proposals the Company may receive. The Stockholder is reserving the right, consistent with the requirements of applicable law, to submit additional proposals, fewer proposals or different proposals at the Annual Meeting. The Stockholder, in furnishing the notice described above, does not concede the validity or enforceability of the provisions of the Company's By-Laws that purport to impose advance notice requirements or otherwise limit the right of any stockholder to present business or nominees for consideration at any meeting of the stockholders, and expressly reserves the right to challenge the validity, application and interpretation of any such provision. In addition, the Stockholder reserves the right to challenge the legality, validity or enforceability of the Company's decision, announced on January 21, 2005, to accelerate the date of the Annual Meeting and the date for submission of proposals and nominees for presentation by stockholders at the Annual Meeting. Sincerely, /s/ Arnold M. Whitman Arnold M. Whitman ------------------------------------------------------------------------------ ANNEX I INFORMATION REGARDING THE NOMINEES The following table sets forth for each nominee named below (i) the name, age, business address and residence address of such person, and (ii) the principal occupation or employment and five-year business history of such person, including all current directorships held in other public companies or mutual funds. ------------------------------------------------------------------------ NAME, AGE, BUSINESS PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT ADDRESS AND RESIDENCE (INCLUDING THE NAME, AND PRINCIPAL ADDRESS BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH EMPLOYMENT IS CARRIED ON AND WHETHER SUCH CORPORATION OR ORGANIZATION IS A PARENT, SUBSIDIARY, OR OTHER AFFILIATE OF THE COMPANY) AND BUSINESS EXPERIENCE DURING LAST FIVE YEARS; CURRENT DIRECTORSHIPS ------------------------------------------------------------------------ JEFFREY A. BRODSKY Since 2000, Mr. Brodsky has been a Managing Director of Quest Turnaround Advisors, LLC, a turnaround management consulting services firm. Age: 46 Since 2002, he has served as Chairman and Chief Executive Officer of PTV, Inc. (formerly NTL Business Address: Europe, Inc. and NTL Incorporated), a new media Quest Turnaround company in the United Kingdom located at Advisors, LLC Trafalgar House, 11 Waterloo Place, London SW1Y RiverView at Purchase 4AU, United Kingdom. 287 Bowman Avenue Purchase, NY 10577 Mr. Brodsky is currently a director of AboveNet, Inc., a provider of fiber connectivity for Residence Address: business. From 2002 to 2004, Mr. Brodsky served 10 Sunset Lane as a director of Comdisco Holding Company, Harrison, NY 10528 Inc., a provider of equipment lease financing of information and technology equipment to a variety of industries. From 2002 to 2003, he served as Chairman of Cablecom GmbH, a cable network operator in Switzerland. From 1994 to 1996, he served as a director of Hawaiian Airlines. ------------------------------------------------------------------------ JOHN J. DURSO Since 2002, Mr. Durso has been a partner of the Chicago office of the law firm Michael Age: 53 Best & Friedrich LLP, where he has chaired the national Long-Term Care Practice Group. Prior Business Address: to joining Michael Best, Mr. Durso was for 17 Michael Best & Friedrich years a partner with the law firm of Katten LLP Muchin & Zavis, during which time he chaired 401 North Michigan Avenue the firm's national health care practice. Suite 1900 Chicago, Illinois 60611 Residence Address: 222 N. Columbus #5103 Chicago, Illinois 60601 ------------------------------------------------------------------------ ------------------------------------------------------------------------ PHILIP L. MASLOWE From 1997 until 2002, Mr. Maslowe served as Executive Vice President and Chief Age: 57 Financial Officer of The Wackenhut Corporation, a security, staffing and Business and Residence privatized prisons corporation. Prior to that, Address: from 1993 to 1997, Mr. Maslowe served as 12900 Brynwood Executive Vice President and Chief Financial Palm Beach Gardens, Officer of KinderCare Learning Centers, Inc., Florida 33418 the largest preschool and childcare provider in the U.S. Mr. Maslowe is currently a direct NorthWestern Corporation, a public utility company. Mr. Maslowe previously served as non-executive Chairman of AMF Bowling Worldwide, Inc., the world's largest owner and operator of bowling centers. From August 2002 to December 2004, Mr. Maslowe served on the Board of Directors of Mariner Health Care, Inc., a publicly held integrated health care services provider. ------------------------------------------------------------------------ CHARLES M. MASSON Since September 2002, Mr. Masson has been managing partner of Masson & Company, LLC, a Age: 51 firm providing interim and crisis management, turnaround consulting and assessment, and Business Address: financial restructuring services. From April Masson & Company, LLC 1999 to September 2002, Mr. Masson was a 420 Lexington Avenue managing partner of Leary, Masson & Associates, Suite 2045 LLC, a firm providing similar services. Since New York, New York 10170 2005, he has been serving as Chairman and Chief Restructuring Officer of Kinetic Systems, Inc., Residence Address: an engineering and construction provider of 200 E. 84th Street, #8G process piping to the semi-conductor and New York, New York 10028 bio-pharmaceutical industries. In 2001, he served as Chief Executive Officer of Maidenform, Inc., an intimate apparel maker. Mr. Masson is currently a director of Algoma Steel Inc., an integrated steel producer. ------------------------------------------------------------------------ MOHSIN Y. MEGHJI Since 2002, Mr. Meghji has been a Principal of Loughlin Meghji + Company, a financial Age: 40 advisory boutique specializing in advising management, investors and lenders in Business Address: relation to transactions involving Loughlin Meghji + Company financially challenged companies. From 148 Madison Avenue 1998 to 2002, he was a member of the Global New York, NY 10016 Corporate Finance Group of Arthur Andersen LLP, the accounting firm. Residence Address: From May 2002 when it emerged from Chapter 11 49 Carriage Road to December 2004 upon its sale, Mr. Meghji Roslyn, NY 11576 served on the Board of Directors of Mariner Health Care, Inc., a publicly held integrated health care services provider. From July 1999 to May 2002, Mr. Meghji served as financial advisor to various creditors in relation to the restructuring of Mariner Health Care. ------------------------------------------------------------------------ GUY SANSONE Since 1999, Mr. Sansone has been with Alvarez & Marsal, LLC, a global professional services Age: 40 firm specializing in turnaround management and corporate restructuring, where he has been a Business Address: Managing Director since 2002. From March 2003 to Alvarez & Marsal, Inc. September 2004, he served as Interim Chief 600 Lexington Avenue Financial Officer of Healthsouth Corporation, a New York, NY 10022 provider of outpatient surgery, diagnostic imaging and rehabilitative healthcare services. Residence Address: In 2002, he served as Interim President and 2 Brier Lane Chief Executive Officer of Rotech Healthcare Pelham Manor, NY 10803 Inc., a provider of home medical equipment, respiratory equipment and services and respiratory medications for home use. From 2000 to 2003, he served as Senior Vice President, focusing on the restructuring of Integrated Health Services Inc., a provider of post-acute healthcare services. From 1999 to 2000, he served as Chief Financial Officer of Telegroup, Inc., an alternative provider of domestic and international telecommunications services. Mr. Sansone is currently a director of Rotech Healthcare Inc. ------------------------------------------------------------------------ Except as set forth in this Annex I or the notice (or exhibits thereto) to which this is attached, to the knowledge of the Stockholder, there is no other information regarding any Nominee that is required to be disclosed in a proxy statement filed pursuant to the proxy rules of the Securities and Exchange Commission had the Nominees been nominated, or intended to be nominated, by the Board of Directors of the Company. EXHIBIT A Article III, Section 2 of the Company's Bylaws shall be amended to read in its entirety as follows: Number of Directors. The number of Directors of the Corporation which shall comprise the full Board of Directors shall be fixed at eight. EXHIBIT B NOMINEE CONSENTS The undersigned hereby consents to be named as a nominee of Arnold M. Whitman (the "Stockholder") for election as a director of Beverly Enterprises, Inc. ("BEV") in the Stockholder's notice to BEV of its intent to nominate directors for election at BEV's 2005 annual meeting of stockholders (the "Annual Meeting"), and in any proxy materials filed or distributed on behalf of the Stockholder in connection with the solicitation of proxies for use at the Annual Meeting. The undersigned further consents to serve as a director of BEV if so elected. /s/ Jeffrey A. Brodsky --------------------------- By: Jeffrey A. Brodsky Dated: February 2, 2005 NOMINEE CONSENTS The undersigned hereby consents to be named as a nominee of Arnold M. Whitman (the "Stockholder") for election as a director of Beverly Enterprises, Inc. ("BEV") in the Stockholder's notice to BEV of its intent to nominate directors for election at BEV's 2005 annual meeting of stockholders (the "Annual Meeting"), and in any proxy materials filed or distributed on behalf of the Stockholder in connection with the solicitation of proxies for use at the Annual Meeting. The undersigned further consents to serve as a director of BEV if so elected. /s/ John J. Durso -------------------------- By: John J. Durso Dated: February 3, 2005 NOMINEE CONSENTS The undersigned hereby consents to be named as a nominee of Arnold M. Whitman (the "Stockholder") for election as a director of Beverly Enterprises, Inc. ("BEV") in the Stockholder's notice to BEV of its intent to nominate directors for election at BEV's 2005 annual meeting of stockholders (the "Annual Meeting"), and in any proxy materials filed or distributed on behalf of the Stockholder in connection with the solicitation of proxies for use at the Annual Meeting. The undersigned further consents to serve as a director of BEV if so elected. /s/ Philip L. Maslowe ---------------------------- By: Philip L. Maslowe Dated: February 2, 2005 NOMINEE CONSENTS The undersigned hereby consents to be named as a nominee of Arnold M. Whitman (the "Stockholder") for election as a director of Beverly Enterprises, Inc. ("BEV") in the Stockholder's notice to BEV of its intent to nominate directors for election at BEV's 2005 annual meeting of stockholders (the "Annual Meeting"), and in any proxy materials filed or distributed on behalf of the Stockholder in connection with the solicitation of proxies for use at the Annual Meeting. The undersigned further consents to serve as a director of BEV if so elected. /s/ Charles M. Masson ------------------------------ By: Charles M. Masson Dated: February 3, 2005 NOMINEE CONSENTS The undersigned hereby consents to be named as a nominee of Arnold M. Whitman (the "Stockholder") for election as a director of Beverly Enterprises, Inc. ("BEV") in the Stockholder's notice to BEV of its intent to nominate directors for election at BEV's 2005 annual meeting of stockholders (the "Annual Meeting"), and in any proxy materials filed or distributed on behalf of the Stockholder in connection with the solicitation of proxies for use at the Annual Meeting. The undersigned further consents to serve as a director of BEV if so elected. /s/ Mohsin Y. Meghji ------------------------------ By: Mohsin Y. Meghji Dated: February 3, 2005 NOMINEE CONSENTS The undersigned hereby consents to be named as a nominee of Arnold M. Whitman (the "Stockholder") for election as a director of Beverly Enterprises, Inc. ("BEV") in the Stockholder's notice to BEV of its intent to nominate directors for election at BEV's 2005 annual meeting of stockholders (the "Annual Meeting"), and in any proxy materials filed or distributed on behalf of the Stockholder in connection with the solicitation of proxies for use at the Annual Meeting. The undersigned further consents to serve as a director of BEV if so elected. /s/ Guy Sansone ------------------------------- By: Guy Sansone Dated: February 2, 2005 EXHIBIT C INDEMNIFICATION AGREEMENT AGREEMENT, dated as of February 3, 2005, by and among Appaloosa Management L.P., on behalf of certain funds for which it acts as investment adviser ("Appaloosa"), Franklin Mutual Advisers, LLC, on behalf of certain funds for which it acts as investment adviser ("Franklin"), and Formation Capital, LLC ("Formation", and together with Appaloosa and Franklin, the "Indemnitors"), and each of Jeffrey A. Brodsky, Guy Sansone, Mohsin Y. Meghji, Charles M. Masson, John J. Durso and Philip Maslowe (each an "Indemnitee"). WHEREAS, the Indemnitors have asked the Indemnitees, and Indemnitees have agreed, to be nominees for election to the Board of Directors of Beverly Enterprises, Inc., a Delaware corporation ("Beverly"), at the 2005 annual meeting of stockholders of Beverly (the "Annual Meeting"); and WHEREAS, one or more of the Indemnitors and/or their affiliates may, in appropriate circumstances, solicit proxies from the stockholders of Beverly in support of Indemnitees' election as directors of Beverly at the Annual Meeting (the "Solicitation"). NOW, THEREFORE, in consideration of the foregoing and with the understanding on the part of the Indemnitors that each of the Indemnitees is relying on this Agreement in agreeing to be a nominee as aforesaid and for other and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 1. Certain Definitions. As used in this Agreement, the following defined terms have the meanings indicated below: "Claim" means any threatened, pending or completed action, suit or proceeding (whether civil, criminal, administrative, formal or informal investigative or other), whether instituted by Beverly or any other party, or any inquiry or investigation that Indemnitee in good faith believes might lead to the institution of any such action, suit or proceeding. "Expenses" means all reasonable attorneys' fees and all other reasonable fees, costs, expenses and obligations paid or incurred in connection with the Solicitation or related matters, including without limitation, investigating, defending or participating (as a party, witness or otherwise) in (including on appeal), or preparing to defend or participate in, any Claim relating to any Indemnifiable Event including the costs and expenses of the Indemnitee seeking enforcement of this Agreement. "Indemnification Amount" shall mean $25,000,000. "Indemnifiable Event" means any event or occurrence relating to or directly or indirectly arising out of, or any action taken or omitted to be taken in connection with the Solicitation or related matters, but not in Indemnitee's capacity as a director of Beverly if he is so elected. "Indemnity Percentage" means, with respect to Appaloosa, 40%; with respect to Franklin, 46.7%: and with respect to Formation, 13.33%. "Loss" means any and all damages, judgments, fines, penalties, amounts paid or payable in settlement, deficiencies, losses and Expenses (including all interest, assessments, and other charges paid or payable in connection with or in respect of such Losses). 2. Indemnification. (a) In the event any Indemnitee in his capacity as a nominee for election to Beverly's Board of Directors at the Annual Meeting was, is or becomes a party to or other participant in, or is threatened to be made a party to or other participant in, a Claim by reason of (or arising or allegedly arising in any manner out of or relating to in whole or in part) an Indemnifiable Event or the Indemnitee's being a nominee for election to Beverly's Board of Directors at the Annual Meeting, the Indemnitors, to the fullest extent permitted by applicable law, shall indemnify and hold harmless the Indemnitee from and against any and all Losses suffered, incurred or sustained by Indemnitee or to which Indemnitee becomes subject, resulting from, arising out of or relating to such Claim (it being understood that except as provided in Section 2(c) with respect to Expenses, reimbursements of any such Losses shall be made as soon as practicable but in any event no later than 15 days after written request (a "Claim Notice") is made to the Indemnitors accompanied by supporting documentation). An Indemnitee shall give the Indemnitors written notice of any Claim (accompanied by such reasonable supporting documentation as may be in the Indemnitee's possession) as soon as practicable after the Indemnitee becomes aware thereof; provided, that the failure of an Indemnitee to give such notice shall not relieve the Indemnitors of their indemnification obligations under this Agreement, except to the extent that such failure materially prejudices the rights of the Indemnitors. (b) In the case of the commencement of any action against an Indemnitee in respect of which he may seek indemnification from the Indemnitors hereunder, the Indemnitors (acting jointly) may, by written notice to the Indemnitee, elect to assume the defense thereof (with counsel reasonably satisfactory to the Indemnitee), including, without limitation, the negotiation and approval of any settlement of such action. After notice from the Indemnitors to the Indemnitee of the Indemnitors' election so to assume the defense thereof, the Indemnitors will not be liable to Indemnitee under this Agreement for any Expenses subsequently incurred by him in connection with the defense thereof other than reasonable costs of investigation and preparation therefor (including, without limitation, appearing as a witness and reasonable fees and expenses of legal counsel in connection therewith). If, in any action for which indemnity may be sought hereunder, the Indemnitors shall not have timely assumed the defense thereof with counsel reasonably satisfactory to the applicable Indemnitee, or an Indemnitee shall have been advised by his counsel that it would constitute a conflict of interest for the same counsel to represent both him and the Indemnitors or both him and any other Indemnitee in such action, or if an Indemnitee may have separate or additional defenses with regard to such action, Indemnitee shall have the right to employ his own counsel reasonably satisfactory to the Indemnitors in such action, in which event the Indemnitors shall reimburse Indemnitee for all reasonable legal fees and expenses incurred by him in connection with the defense thereof. The Indemnitors shall in no event be liable for any settlement of any action effected without their prior written consent (which consent shall not be unreasonably withheld). The Indemnitors shall not settle any Claim in any manner that would impose any expense, penalty, obligation or limitation on an Indemnitee, or would contain language (other than a recitation of any amounts to be paid in settlement) that could reasonably be viewed as an acknowledgment of wrongdoing on the part of an Indemnitee or as materially detrimental to the reputation of an Indemnitee, without that Indemnitee's prior written consent (which consent shall not be unreasonably withheld). (c) Each Indemnitee's right to indemnification in Section 2 of this Agreement shall include the right of the Indemnitee to be advanced by the Indemnitors any Expenses incurred in connection with any Indemnifiable Event as such expenses are incurred by the Indemnitee; provided, however, that all amounts advanced in respect of such Expenses shall be repaid to the Indemnitors by the Indemnitee if it shall ultimately be determined in a final judgment that the Indemnitee is not entitled to be indemnified for such Expenses. 3. Partial Indemnity, Etc. If an Indemnitee is entitled under any provision of this Agreement to indemnification by the Indemnitors for some or a portion of any Loss, but not for all of the total amount thereof, the Indemnitors shall nevertheless indemnify the Indemnitee for the portion thereof to which Indemnitee is entitled. Moreover, notwithstanding any other provision of this Agreement, to the extent that the Indemnitee has been successful on the merits or otherwise in defense of any or all Claims relating in whole or in part to an Indemnifiable Event or in defense of any issue or matter therein, including dismissal without prejudice, the Indemnitee shall be indemnified against all Expenses incurred in connection therewith pursuant to the terms of this Agreement. 4. No Presumptions. For purposes of this Agreement, the termination of any claim, action, suit or proceeding, by judgment, order, settlement (whether with or without court approval), or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that an Indemnitee did not meet any particular standard of conduct or have any particular belief or that a court has determined that indemnification is not permitted by applicable law. 5. Amendments, Etc. No supplement, modification or amendment of this Agreement shall be binding with respect to any party unless executed in writing by such party. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver. 6. Subrogation. In the event of payment under this Agreement, the Indemnitors shall be subrogated to the extent of such payment to all of the rights of recovery of the applicable Indemnitee, and that Indemnitee shall, at the Indemnitors' expense, execute all papers reasonably required and shall do everything that may be reasonably necessary to secure such rights, including the execution of such documents reasonably necessary to enable the Indemnitors effectively to bring suit to enforce such rights. 7. No Duplication of Payments. The Indemnitors shall not be liable under this Agreement to make any payment in connection with a Claim made against an Indemnitee to the extent the Indemnitee has otherwise actually received payment (under any insurance policy, by-law or otherwise) of the amounts otherwise indemnifiable hereunder provided that, if an Indemnitee for any reason is required to disgorge any payment actually received by him, the Indemnitors shall be obligated to pay such amount to the Indemnitee in accordance with the other terms of this Agreement (i.e., disregarding the terms of this Section 7). 8. Allocation of Responsibility. Notwithstanding anything herein to the contrary, each Indemnitor shall be liable only for such Indemnitor's Indemnity Percentage of any payments, advances, Losses or Expenses for which the Indemnitors are otherwise liable pursuant to this Agreement and each Indemnitor's liability hereunder shall not, in the aggregate, exceed such Indemnitor's Indemnity Percentage of the Indemnification Amount. 9. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without giving effect to principles of conflicts of laws. 10. Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original, but which together shall constitute one agreement. 11. Entire Agreement. This Agreement constitutes the entire agreement among the parties with respect to the subject hereof. [Remainder of Page Intentionally Left Blank] IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above written. FORMATION CAPITAL, LLC By: /s/ Arnold M. Whitman --------------------------------- Name: Arnold M. Whitman Title: Chief Executive Officer APPALOOSA MANAGEMENT L.P., on behalf of certain funds for which it acts as investment adviser By: /s/ Kenneth Maiman --------------------------------- Name: Kenneth Maiman Title: Principal FRANKLIN MUTUAL ADVISERS, LLC, on behalf of certain funds for which it acts as investment adviser By: /s/ Bradley Takahashi --------------------------------- Name: Bradley Takahashi Title: Vice President /s/ Jeffrey A. Brodsky ------------------------------ Jeffrey A. Brodsky /s/ Guy Sansone ------------------------------ Guy Sansone /s/ Mohsin Y. Meghji ------------------------------ Mohsin Y. Meghji /s/ Charles M. Masson ------------------------------ Charles M. Masson /s/ John J. Durso ------------------------------ John J. Durso /s/ Philip Maslowe ------------------------------ Philip Maslowe EXHIBIT D PROJECT SILLS OPERATING AGREEMENT SUMMARY TERM SHEET [Filed as Exhibit G to the Statement] EX-99 5 exhi99_12.txt EXHIBIT L Exhibit L Each of the following persons may be deemed to be a "participant in the solicitation" (as defined in Instruction 3 to Item 4 of Schedule 14A of the Securities Exchange Act of 1934, as amended) of the stockholders of the Company in connection with the Company's 2005 annual meeting of stockholders. The following table sets out the interests of the following persons in the solicitation to the extent not otherwise described in the Statement. The fact that a person is listed below shall not be deemed an admission that such person is a participant. Unless otherwise indicated, all capitalized terms used in this Exhibit L shall have the meanings given to them in the Statement to which this Exhibit L is an Exhibit. INTERESTS IN THE SOLICITATION TO THE EXTENT NOT NAME OTHERWISE DESCRIBED IN THE STATEMENT -------------------- --------------------------------------------------------- AILP Palomino Appaloosa API David Tepper Ronald Goldstein Vice President and Secretary of API Franklin Mutual Michael J. Embler Senior Vice President of Franklin Mutual Northbrook David Hokin Rob Rubin Robert Hartman David Reis Baylor Enterprises LLC Arnold M. Whitman Steve Fishman President of Formation Formation Capital, LLC Eureka Stephen A. Greene Managing Director of Eureka Mark Hyman Managing Director of Eureka Leslie Feldman Executive Director of Eureka Jeffrey A. Brodsky Nominee of A. Whitman John J. Durso Nominee of A. Whitman Philip L. Maslowe Nominee of A. Whitman Charles M. Masson Nominee of A. Whitman Mohsin Y. Meghji Nominee of A. Whitman Guy Sansone Nominee of A. Whitman