-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, MDGRjOffKkIP+Bs+ltjlAhTemEipX+g+aSJ4rf1+8lPHRCiP5ZNg34AeMZRkhPKV 5njwotpe5yWcP8UJ9xg4ig== 0000950124-98-005388.txt : 19981002 0000950124-98-005388.hdr.sgml : 19981002 ACCESSION NUMBER: 0000950124-98-005388 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 5 CONFORMED PERIOD OF REPORT: 19980925 ITEM INFORMATION: ITEM INFORMATION: FILED AS OF DATE: 19981001 SROS: NYSE FILER: COMPANY DATA: COMPANY CONFORMED NAME: HCR MANOR CARE INC CENTRAL INDEX KEY: 0000878736 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SKILLED NURSING CARE FACILITIES [8051] IRS NUMBER: 341687107 STATE OF INCORPORATION: OH FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: SEC FILE NUMBER: 001-10858 FILM NUMBER: 98719660 BUSINESS ADDRESS: STREET 1: ONE SEAGATE CITY: TOLEDO STATE: OH ZIP: 43604-2616 BUSINESS PHONE: 4192525500 MAIL ADDRESS: STREET 1: ONE SEAGATE CITY: TOLEDO STATE: OH ZIP: 43604-2616 FORMER COMPANY: FORMER CONFORMED NAME: HEALTH CARE & RETIREMENT CORP / DE DATE OF NAME CHANGE: 19930328 8-K 1 FORM 8-K 1 SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): September 25, 1998 HCR MANOR CARE, INC. (Exact name of registrant as specified in charter) Delaware 0-10858 34-1687107 (State or (Jurisdiction (Commission (I.R.S. Employer of Incorporation) File Number) Identification No.)
One SeaGate 43604-2616 Toledo Ohio (Zip Code) (Address of Principal Executive Offices)
Registrant's telephone number, including area code: (419) 252-5500 Registrants former name, changed since last report: Health Care and Retirement Corporation Item 2. Acquisition or Disposition of Assets. On September 25, 1998, Manor Care, Inc., a Delaware corporation ("Manor Care") and Health Care and Retirement Corporation ("HCR") and Catera Acquisition Corporation, a Delaware corporation ("Merger Sub"), consummated their merger transaction as set forth in the Amended and Restated Agreement and Plan of Merger dated as of June 10, 1998 between HCR, Merger Sub and Manor Care (the "Merger Agreement"), as amended, whereby Merger Sub merged with and into Manor Care and Manor Care remained as the surviving corporation and a wholly owned subsidiary of HCR (the "Merger"). Upon consummation of the Merger, HCR has been renamed HCR Manor Care, Inc. Pursuant to the Merger Agreement, upon consummation of the Merger, with certain limited exceptions, the owner of each issued and outstanding share of Manor Care common stock, par value $.10 per share is converted into the right to receive one (1.0) share of HCR Manor Care, Inc. common stock, par value $.01 per share. Upon completion of the transaction, the stockholders of Manor Care will become stockholders of HCR Manor Care, Inc. In connection with the execution and delivery of the Merger Agreement and the transactions contemplated thereby, the Board of Directors of HCR authorized the execution and delivery of a Second Amendment, dated as of June 10, 1998, to HCR's Rights Agreement dated as of May 2, 1995, as amended, which is filed herewith as Exhibit 4.1. In connection with the consummation of the Merger, HCR Manor Care, Inc. entered into a Registration Rights Agreement with certain affiliates of Manor Care, which is filed herewith as Exhibit 4.2. HCR and Manor Care issued a joint press release on September 24, 1998 announcing approval of the Merger transaction by the stockholders of HCR and Manor Care, which is filed herewith as Exhibit 99.1. 1 2 HCR Manor Care, Inc. issued a press release on September 25, 1998 announcing the consummation of the Merger transaction between HCR and Manor Care, which is filed herewith as Exhibit 99.2. Item 7. Financial Statements and Exhibits. (c) The following exhibits are filed with this report: 2.1 Amended and Restated Agreement and Plan of Merger, dated June 10, 1998, by and among Manor Care, Inc., Catera Acquisition Corp. and Health Care and Retirement Corporation (filed as Annex A to the Joint Proxy Statement/Prospectus included in Registration Statement number 333-61677). Exhibits and Schedules to the Amended and Restated Agreement and Plan of Merger have not been filed, but will be provided supplementally to Commission upon request. 4.1 Second Rights Amendment dated as of June 10, 1998 between Health Care and Retirement Corporation and Harris Trust and Savings Bank. 4.2 Registration Rights Agreement dated as of September 25, 1998 between HCR Manor Care, Inc. and Stewart Bainum, Stewart Bainum, Jr., Bainum Associates Limited Partnership, MC Investment Limited Partnership, Realty Investment Company, Inc. Mid Pines Associates Limited Partnership, The Stewart Bainum Declaration of Trust and The Jane L. Bainum Declaration of Trust. 99.1 Press Release dated September 24, 1998. 99.2 Press Release dated September 25, 1998. 2 3 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. HCR MANOR CARE, INC. Date: October 1, 1998 By: /s/ R. Jeffrey Bixler ----------------------- Vice President, General Counsel 3 EX-4.1 2 SECOND RIGHTS AMENDMENT DATED JUNE 10,1998 1 EXHIBIT 4.1 HEALTH CARE AND RETIREMENT CORPORATION RIGHTS SECOND AMENDMENT SECOND AMENDMENT, dated as of June 10, 1998 (this "Amendment"), to the Rights Agreement, dated as of May 2, 1995 as amended by the Amendment dated as of June 10, 1998, between HEALTH CARE AND RETIREMENT CORPORATION, a Delaware corporation (the "Company"), and HARRIS TRUST AND SAVINGS BANK (the "Rights Agent"), as authorized by resolution of the board of directors of the Company on June 9, 1998 and ratified by such board on August 13, 1998 (the "Rights Agreement"). The Company and the Rights Agent have heretofore executed and entered into the Rights Agreement. Pursuant to Section 26 of the Rights Agreement, the Company and the Rights Agent may from time to time supplement or amend the Rights Agreement in accordance with the provisions of Section 26 thereof. All acts and things necessary to make this Amendment a valid agreement according to its terms have been done and performed, and the execution and delivery of this Agreement by the Company and the Rights Agent have been in all respects authorized by the Company and the Rights Agent. In consideration of the foregoing premises and mutual agreements set forth in the Rights Agreement and this Amendment, the parties hereto agree as follows: 1. The first sentence of Section 1.1 of the Rights Agreement is hereby amended by replacing "and (B)" in the 31st line thereof with "or (B)". 2. Each of Sections 7.1 and 13.2 of the Rights Agreement is hereby amended by adding the following proviso: "provided, however, none of the Merger, the Merger Agreement, the Ancillary Agreements or the transactions contemplated by any of such agreements shall be subject to this Section." 3. Except as expressly amended hereby, the Rights Agreement remains in full force and effect in accordance with its terms. 4. The Rights Agreement, as amended by this Amendment, and each Right and each Rights Certificate exist under and pursuant to the Delaware General Corporation Law. 5. This Amendment to the Rights Agreement shall be governed by and construed in accordance with the laws of the State of Delaware. 6. This Amendment to the Rights Agreement may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed an original, and all such counterparts shall together constitute but one and the same instrument. 4 2 7. Except as expressly set forth herein, this Amendment to the Rights Agreement shall not by implication or otherwise alter, modify, amend or in any way affect any of the terms, conditions, obligations, covenants or agreements contained in the Rights Agreement, all of which are ratified and affirmed in all respects and shall continue in full force and effect. IN WITNESS WHEREOF, the parties hereto have caused this Amendment to the Rights Agreement to be duly executed as of the day and year first above written. HEALTH CARE AND RETIREMENT CORPORATION By: /s/ R. Jeffrey Bixler ----------------------------- Title: Vice President HARRIS TRUST AND SAVINGS BANK By: /s/ Laura J. Kochis ------------------------------ Title: Vice President 5 EX-4.2 3 REGISTRATION RIGHTS AGREEMENT DATED SEPT. 25, 1998 1 Exhibit 4.2 REGISTRATION RIGHTS AGREEMENT REGISTRATION RIGHTS AGREEMENT (this "Agreement") by and between HCR Manor Care, Inc., a Delaware corporation (the "Company"), and the persons listed on the signature pages hereof (the "Stockholders"), dated September 25, 1998. Capitalized terms used without definition in this Agreement have the meanings ascribed thereto in the Rights Agreement between the Company and Harris Trust and Savings Bank, as amended as of June 10, 1998. RECITALS A. The Company and the Stockholders desire to enter into this Agreement for the purpose of granting to the Stockholders certain rights with respect to registering under the Securities Act of 1933, as amended, shares of common stock, par value $.01 per share, of the Company. B. Such common stock is being acquired by the Stockholders pursuant to the transactions (the "Transactions") contemplated by the Agreement and Plan of Merger, dated as of June 10, 1998, among Manor Care, Inc., a Delaware corporation, Catera Acquisition Corp. and the Company, as amended to the date hereof (the "Merger Agreement"). AGREEMENT In consideration of the recitals, covenants and mutual promises contained herein, and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties, intending to be legally bound, hereby agree as follows: 1. Definitions. As used in this Agreement, the following terms shall have the following meanings: "Advice" shall have the meaning set forth in Section 5 hereof. "Affiliate" means, with respect to any specified person, any other person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified person. For the purposes of this definition, "control" when used with respect to any specified person, means the power to direct the management and policies of such person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms "controlling" and "controlled" have meanings correlative to the foregoing. "Business Day" means any day that is not a Saturday, a Sunday or a legal holiday on which the New York Stock Exchange is not scheduled to be open for trading. "Capital Stock" means, with respect to any person, any and all shares, interests, participations or other equivalents (however designated) of corporate stock issued by such person, including each class of common stock and preferred stock of such person. 8 2 "Common Stock" means the common stock, par value $0.01 per share, of the Company. "Company" shall have the meaning set forth in the heading hereof. "Company Offering" shall have the meaning set forth in Section 2(d). "Exchange Act" means the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder. "Holder" means a person who owns Registrable Shares and is either (i) a Stockholder or (ii) a Permitted Transferee. "Maximum Number" means 10,000,000 Registrable Shares, subject to equitable adjustment by the Board of Directors of the Company to reflect any stock dividend or stock split or other change, conversion, exchange, subdivision, combination, distribution, recapitalization or reclassification, which limit may be waived by the Company in its sole discretion. "Minimum Number" means the lesser of 2,500,000 Registrable Shares, subject to equitable adjustment by the Board of Directors of the Company to reflect any stock dividend or stock split or other change, conversion, exchange, subdivision, combination, distribution, recapitalization or reclassification, or that number of Registrable Shares which would yield $100 million or more in aggregate gross proceeds in any public offering thereof, which minimum may be waived by the Company in its sole discretion. "Permitted Transferees" means (a) Stewart Bainum or his spouse or widow, their lineal descendants or their spouses or widows or widowers (so long as they remain spouses) (each a "Member of the Bainum Family"), or the estate of the foregoing persons (but only until such time as the Common Stock are distributed therefrom), and (b) any partnership, trust, corporation or other entity (each, an "Entity"), but only if a Member or Members of the Bainum Family or another Entity satisfying the requirements hereof are the sole "Beneficial Owners" (as such term is defined in the HCR Rights Plan (as defined in the Merger Agreement)) of the Common Stock held by such Entity, other than any officer, trustee, director, or other managing person or managing partner or managing member of any such Entity to the extent any such person is deemed to be the Beneficial Owner of Common Stock held by such Entity, provided such person is not the Beneficial Owner, other than through an Entity described in this clause (b), of in excess of 1% of the total outstanding Common Stock. "Person" means any individual, corporation, partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. "Piggyback Registration" shall have the meaning set forth in Section 3 hereof. "Prospectus" means the prospectus included in any Registration Statement (including a prospectus that discloses information previously omitted from a prospectus filed as 9 3 part of an effective registration statement in reliance upon Rule 430A), as amended or supplemented by any prospectus supplement, with respect to the terms of the offering of any portion of the Registrable Shares covered by such Registration Statement and all other amendments and supplements to such prospectus, including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such prospectus. "Registrable Shares" means any Common Stock issued to any Holder named on the signature pages hereof in the Transactions or any other shares of capital stock or other securities of the Company into which such shares of Common Stock shall be reclassified, converted, exchanged or changed, including, without limitation, by reason of a merger, consolidation, subdivision, stock combination, exchange, reorganization or recapitalization. If the Common Stock has been so reclassified or changed, or if the Company pays a dividend or makes a distribution on the Common Stock in shares of capital stock or splits or subdivides (or combines) its outstanding shares of Common Stock into a greater (or smaller) number of shares of Common Stock, a share of Common Stock shall be deemed to be such number of shares of stock and amount of other securities to which a holder of a share of Common Stock outstanding immediately prior to such change, conversion, reclassification, exchange, dividend, distribution, subdivision, split or combination would be entitled. As to any particular Registrable Shares, once issued such shares shall cease to be Registrable Shares when (i) a Registration Statement with respect to the sale of such shares shall have become effective under the Securities Act and such shares shall have been disposed of in accordance with such Registration Statement, (ii) they shall have been distributed to the public pursuant to Rule 144 (or any successor provision) under the Securities Act, (iii) they shall have been otherwise transferred and new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent disposition of them shall not require registration or qualification of them under the Securities Act or any state securities or blue sky law then in force, (iv) they shall have ceased to be outstanding, (v) when sold, or otherwise transferred to, any Person who is not a Holder or Permitted Transferee or (vi) there has occurred the first date on which the number of Registrable Shares outstanding is less than five percent (5%) of the then outstanding shares of Common Stock. "Registration" means registration under the Securities Act of an offering of Registrable Shares pursuant to a Demand Registration or a Piggyback Registration. "Registration Period" means, as to any Holder, the period beginning on the date hereof and ending on the date which is the earlier of (i) the fourth anniversary of the date hereof and (ii) the date when such Holder no longer owns any Registrable Shares. "Registration Statement" means any registration statement of the Company under the Securities Act that covers any of the Registrable Shares pursuant to the provisions of this Agreement, including the related Prospectus, all amendments and supplements to such registration statement, including pre- and post-effective amendments, all exhibits thereto and all material incorporated by reference or deemed to be incorporated by reference in such registration statement. 10 4 "HCR Rights Plan Amendment" shall have the meaning ascribed to such term in the Merger Agreement. "SEC" means the Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder. "Underwritten Registration" or "Underwritten Offering" means a registration under the Securities Act in which securities of the Company are sold to an underwriter for reoffering to the public. 2. Demand Registration. (a) Any person designated by the Holders of at least 50% of the Registrable Shares shall have the right during the Registration Period, by written notice (the "Demand Notice") given to the Company, to request the Company to register under and in accordance with the provisions of the Securities Act all or any portion of the Registrable Shares designated by such Holders; provided, however, that the aggregate number of Registrable Shares requested to be registered pursuant to any Demand Notice shall be at least the Minimum Number. As of the date of this Agreement, until such time as the Holders of at least 50% of the Registrable Shares shall have notified the Company of another designee, the person designated to give the Demand Notice shall be Realty Investment Company, Inc. (and the Company shall be entitled to receive evidence of all requisite corporate action of Realty Investment Company, Inc. with respect to such Demand Notice). Upon receipt of any such Demand Notice, the Company shall promptly notify all other Holders of the receipt of such Demand Notice and allow them the opportunity, subject to the other terms of this Section 2, to include Registrable Shares held by them in the proposed registration by submitting their own written notice to the Company requesting inclusion of a specified number of such Holders' Registrable Shares (the "Inclusion Notice"). The Holders as a group shall be entitled to four Demand Registrations pursuant to this Section 2; if any such Demand Registration does not become effective or is not maintained for the period (whether or not continuous) required by Section 2(c), the affected Holders will be entitled to an additional Demand Registration pursuant hereto. It is agreed that the registration of Registrable Shares pursuant to an Inclusion Notice shall not be deemed to be a Demand Registration. Nothing in this Section 2(a) shall limit any rights pursuant to Section 3 hereof. (b) Subject to the other terms of this Section 2, the Company, within 45 days of the date on which the Company receives a Demand Notice given by Holders in accordance with Section 2(a) hereof, shall file with the SEC, and the Company shall thereafter use commercially reasonable efforts to cause to be declared effective, a Registration Statement on the appropriate form for the registration and sale, in accordance with the intended method or methods of distribution, of the total number of Registrable Shares specified by the Holders in such Demand Notice, which may include a "shelf" registration (a "Shelf Registration") pursuant to Rule 415 under the Securities Act (a "Demand Registration"). 11 5 (c) The Company shall use commercially reasonable efforts to cause the Registration Statement to be declared effective and to keep each Registration Statement filed pursuant to this Section 2 continuously effective and usable for the resale of the Registrable Shares covered thereby (i) in the case of a Registration that is not a Shelf Registration, for a period of 60 days from the date on which the SEC declares such Registration Statement effective and (ii) in the case of a Shelf Registration, for a period of 120 days from the date on which the SEC declares such Registration Statement effective, except, in either case, (x) if earlier, then only until the date all the Registrable Shares covered by such Registration Statement have been sold pursuant to such Registration Statement, and (y) if later, until such later date as may be extended pursuant to this Section 2. (d) Company's Ability to Postpone. (i) If, upon receipt of a Demand Notice pursuant to this Section 2, the Board of Directors of the Company determines in good faith that a registration at the time and on the terms requested would adversely affect any public offering of securities of the Company by the Company (other than in connection with employee benefit and similar plans) or by or on behalf of any stockholder of the Company exercising a demand registration right (collectively, a "Company Offering") with respect to which the Company has commenced preparations for a registration or received notice of the exercise of such demand registration right prior to the receipt of a Demand Notice and the Company furnishes the Holders with a certificate signed by the chief financial officer of the Company to such effect (the "Transaction Delay Notice") promptly after such Demand Notice, the Company shall not be required to file a Registration Statement pursuant to this Section 2 until the earliest of (A) 45 days after the completion of such Company Offering, (B) promptly after the abandonment of such Company Offering or (C) 90 days after the date of the Transaction Delay Notice; provided, however, that in any event the Company shall not be required to file any Registration Statement prior to the termination, waiver or reduction of any "blackout period" or Holdback Period required by the underwriters to be applicable to the Holders or the Company, if any, in connection with any Company Offering or Section 4 hereof. (ii) If upon receipt of a Demand Notice pursuant to this Section 2 or while a registration requested pursuant to this Section 2 is pending, the Company determines in its good faith judgment after consultation with the Company's principal securities counsel that the filing of a Registration Statement would require disclosure of material information which the Company has a bona fide business purpose for preserving as confidential and the Company provides the Holders written notice (the "Information Delay Notice" and, together with the Transaction Delay Notice, the "Delay Notice") thereof promptly after the Company makes such determination, which shall be made promptly after the receipt of any Demand Notice, the Company shall not be required to comply with its obligations under this Section 2 until the earlier of (A) the date upon which such material information is disclosed to the public or ceases to be material or (B) 90 days after the Holders' receipt of such Delay Notice. 12 6 (iii) Notwithstanding the foregoing provisions of this Section 2(d), the Company shall be entitled to serve only one Delay Notice (i) within any period of 270 consecutive days or (ii) with respect to any two consecutive registrations requested pursuant to this Section 2. (iv) At any time when a Registration Statement effected pursuant to this Section 2 relating to Registrable Shares is effective, and a Prospectus relating thereto is required to be delivered under the Securities Act in connection therewith, and the Company becomes aware that the Prospectus included in such Registration Statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, to the extent that the amendment or supplement to such prospectus necessary to correct such untrue statement of a material fact or omission to state a material fact would require disclosure of material information which the Company has a bona fide business purpose for preserving as confidential and the Company provides the Holders written notice thereof promptly after the Company makes such determination, the Holders shall suspend sales of Registrable Shares pursuant to such Registration Statement and the Company shall not be required to comply with its obligations under Sections 5(e) or 5(h) until the earlier of (A) the date upon which such material information is disclosed to the public or ceases to be material or (B) 90 days after the Holders' receipt of such written notice. If the Holders' disposition of Registrable Shares is discontinued pursuant to the foregoing sentence, unless the Company thereafter extends the effectiveness of the Registration Statement to permit dispositions of Registrable Shares by the Holders for an aggregate of 60 days, the Registration Statement shall not be counted for purposes of determining the number of registrations permitted under Section 2 hereof. (e) Maximum Registration. In no event shall the Company be required to effect the registration of Registrable Shares under either Section 2 or 3 hereof which would, when aggregated with prior registrations of Registrable Shares, concern or result in the sale or resale of more than the Maximum Number in any twelve month period. (f) Company and Other Holders. Subject to Section 2(g), the Company and other holders of Common Stock may include Common Stock in any Demand Registration, provided that Company and such holders of Common Stock pay a pro rata portion of the costs incurred in the preparation and filing of such Registration Statement based upon the number of shares of Common Stock registered pursuant to the effective Registration Statement. (g) Revocation. Holders of a majority in number of the Registrable Shares to be included in a Registration Statement pursuant to this Section 2 may, at any time prior to the effective date of the Registration Statement relating to such Registration, revoke such request by providing a written notice to the Company revoking such request. The Holders of Registrable Shares who revoke such request shall reimburse the Company for all its out-of-pocket expenses incurred in the preparation, filing and processing of the Registration Statement. In addition, if pursuant to the terms of this Section 2(g), the Holders reimburse the Company for 13 7 its out-of-pocket expenses incurred in the preparation, filing and processing of any Registration Statement requested and subsequently revoked by such Holder(s), such Holder(s) registrations shall not count against the maximum number of Demand Registrations to which the applicable Holder(s) are entitled under Section 2(a). (h) Priority on Demand Registrations. Notwithstanding any other term of this Section 2, if (i) a Registration pursuant to this Section 2 involves an Underwritten Offering and the managing underwriter or underwriters of such proposed Underwritten Offering advises Company that the number of securities requested to be included in such Demand Registration exceeds the number which can be sold in the offering covered by such Demand Registration without a significant adverse effect on the price, timing or distribution of the securities offered, or (ii) the number of Registrable Shares requested to be included in such Demand Registration exceeds the Maximum Number, then the Company will include in such Registration (A) first, the number of Registrable Shares that is the lesser of (x) the Maximum Number and (y) the number which, in the opinion of such managing underwriter or underwriters, can be sold in the offering without a significant adverse effect on the price, timing or distribution of the securities offered, selected pro rata among the Holders which have requested to be included in such Demand Registration based upon their relative proportionate total holdings of Common Stock on the date of this Agreement, (B) second, the lesser of (x) the number of shares of Common Stock which Company has requested be included in such Registration, which, in the opinion of the managing underwriter or underwriters, can be sold without such adverse effect referred to above and (y) if a cutback has been effected on the basis of the Maximum Number under clause (A), zero (0), and (C) third, the lesser of (x) the number of shares of Common Stock which other holders have requested be included in such Registration, which, in the opinion of the managing underwriter or underwriters, can be sold without such adverse effect referred to above, such amount to be allocated pro rata among such other holders based upon their relative proportionate holdings of Common Stock and (y) if a cutback has been effected on the basis of the Maximum Number, zero (0). (i) Selection of Underwriters. If any offering pursuant to a Demand Registration involves an Underwritten Offering, the Company and Manor Care shall select a mutually acceptable managing underwriter or underwriters to administer the offering, which managing underwriters shall be a firm of nationally recognized standing and reasonably satisfactory to holders of a majority of the Registrable Shares sought to be included in such Registration Statement. 3. Piggyback Registration. (a) Right to Piggyback. If at any time during the Registration Period the Company proposes to file a registration statement under the Securities Act with respect to a public offering of securities of the same type as the Registrable Shares pursuant to a firm commitment underwritten offering solely for cash for its own account (other than a registration statement (i) on Form S-4 or S-8 or any successor forms thereto, or (ii) filed solely in connection with a dividend reinvestment plan or employee benefit plan of the Company or its Affiliates) or for the account of any holder of securities of the same type as the Registrable Shares (to the 14 8 extent that the Company has the right to include Registrable Shares in any registration statement to be filed by the Company on behalf of such holder), then the Company shall give written notice of such proposed filing to the Holders at least 15 days before the anticipated effective date. Such notice shall offer the Holders the opportunity to register such amount of Registrable Shares as they may request (a "Piggyback Registration"). Subject to Section 3(b) hereof, the Company shall include in each such Piggyback Registration all Registrable Shares with respect to which the Company has received written requests for inclusion therein within 10 days after notice has been given to the Holders. Each Holder shall be permitted to withdraw all or any portion of the Registrable Shares of such Holder from a Piggyback Registration at any time prior to the effective date of such Piggyback Registration; provided, however, that if such withdrawal occurs after the filing of the Registration Statement with respect to such Piggyback Registration, the withdrawing Holders shall reimburse the Company for the portion of the registration expenses payable with respect to the Registrable Shares so withdrawn. (b) Priority on Piggyback Registrations. Notwithstanding any other term of this Section 3, if a Registration pursuant to this Section 3 involves an Underwritten Offering and the managing underwriter or underwriters of such proposed Underwritten Offering advises Company that in its opinion the number of securities requested to be included in such Piggyback Registration exceeds the number which can be sold in the offering covered by such Piggyback Registration without a significant adverse effect on the price, timing or distribution of the securities offered, then the Company will include in such Registration (i) first, the number of Registrable Shares sought to be sold by the person(s) or entities (including the Company) which initiated such Registration that, in the opinion of such managing underwriter or underwriters, can be sold in the offering without a significant adverse effect on the price, timing or distribution of the securities offered, selected pro rata among the Company and such holders based upon the relative proportionate shares they proposed to sell in such Registration and (ii) the number of shares of Common Stock which other holders (including the Holders) have requested be included in such Registration, which, in the opinion of the managing underwriter or underwriters, can be sold without such adverse effect referred to above, such amount to be allocated pro rata among such Holders and other holders based upon the relative proportionate shares they propose to sell in such Registration. (c) Right to Suspend or Abandon. Nothing in this Section 3 or Section 5 hereof (with respect to an offering under this Section 3) shall create any liability or obligation on the part of the Company to the Holders if the Company in its sole discretion should decide (i) not to file a registration statement proposed to be filed pursuant to Section 3(a) hereof, (ii) to withdraw such registration statement subsequent to its filing and prior to the later of its effectiveness or the release of the Registrable Shares for public offering by the managing underwriter, in the case of an underwritten public offering or (iii) to suspend or terminate any offering or the effectiveness of any registration statement by the Company or at the request of any person, entity or governmental authority, regardless of any action whatsoever that a Holder may have taken, whether as a result of the issuance by the Company of any notice hereunder or otherwise. 15 9 4. Holdback Agreement. If (i) the Company shall file a registration statement with respect to the Common Stock or similar securities or securities convertible into, or exchangeable or exercisable for, such securities and (ii) the Company (in the case of a nonunderwritten public offering by the Company pursuant to such registration statement) advises the Holders in writing that a public sale or distribution of Registrable Shares would materially adversely affect such offering or the managing underwriter or underwriters (in the case of an underwritten public offering by the Company pursuant to such registration statement) advises the Company in writing (in which case the Company shall notify the Holders) that a public sale or distribution of Registrable Shares would have a significant adverse effect on the price, timing or distribution of such offering, then each Holder shall, to the extent not inconsistent with applicable law, refrain from effecting any public sale or distribution of Registrable Shares during the 7 days prior to the effective date of such registration statement and until the earliest of (A) the abandonment of such offering, (B) 120 days from the effective date of such registration statement and (C) if such offering is an Underwritten Offering, the termination of any "hold back" period obtained by the underwriter or underwriters in such offering from the Company in connection therewith (each such period, a "Holdback Period"). 5. Registration Procedures. In connection with the registration obligations of the Company pursuant to and in accordance with Sections 2 and 3 hereof (and subject to Sections 2 and 3 hereof), the Company shall use its best efforts to effect such registration to permit the sale of such Registrable Shares in accordance with the intended method or methods of disposition thereof, and pursuant thereto the Company shall as expeditiously as possible (but subject to Sections 2 and 3 hereof): (a) at least ten (10) business days before filing a Registration Statement or Prospectus or any amendments or supplements thereto, furnish to the Holders who are participating in such Registration Statement and the underwriters, if any, copies of all such documents proposed to be filed, which documents will be subject to the review of such Holders and such underwriters, and one counsel selected by the Holders of a majority of the Registrable Shares participating in such Registration Statement ("Holder Counsel") and the underwriters' counsel, and, in the case of a Demand Registration, the Company will not file any Registration Statement or amendment thereto or any Prospectus or any supplement thereof to which the Holders of Registrable Shares participating in such Registration Statement or the underwriters, if any, shall reasonably object; (b) prepare and file with the SEC a Registration Statement for the sale of the Registrable Shares on any form for which the Company then qualifies or which counsel for the Company shall deem appropriate in accordance with such Holders' intended method or methods of distribution thereof, subject to Section 2(b) hereof, and, subject to the Company's right to suspend, terminate or abandon a registration pursuant to Section 3(c) hereof, use commercially reasonable efforts to cause such Registration Statement to become effective and remain effective as provided herein; (c) prepare and file with the SEC such amendments (including post-effective amendments) to such Registration Statement, and such supplements to the related 16 10 Prospectus, as may be required by the rules, regulations or instructions applicable to the Securities Act during the applicable period in accordance with the intended methods of disposition specified by the Holders of the Registrable Shares covered by such Registration Statement, make generally available earnings statements satisfying the provisions of Section 11(a) of the Securities Act (provided that the Company shall be deemed to have complied with this clause if it has complied with Rule 158 under the Securities Act), and cause the related Prospectus as so supplemented to be filed pursuant to Rule 424 under the Securities Act; provided, however, that before filing a Registration Statement or Prospectus, or any amendments or supplements thereto (other than reports required to be filed by it under the Exchange Act), the Company shall furnish to the Holders of Registrable Shares covered by such Registration Statement and the Holder Counsel for review and comment, copies of all documents required to be filed; (d) notify the Holders of any Registrable Shares covered by such Registration Statement promptly and (if requested) confirm such notice in writing, (i) when a Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to such Registration Statement or any post-effective amendment, when the same has become effective, (ii) of any request by the SEC for amendments or supplements to such Registration Statement or the related Prospectus or for additional information regarding such Holders, (iii) of the issuance by the SEC of any stop order suspending the effectiveness of such Registration Statement or the initiation of any proceedings for that purpose, (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification or exemption from qualification of any of the Registrable Shares for sale in any jurisdiction or the initiation or threatening of any proceeding for such purpose, and (v) of the happening of any event that requires the making of any changes in such Registration Statement, Prospectus or documents incorporated or deemed to be incorporated therein by reference so that they will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading: (e) subject to Section 2(d), use its best efforts to obtain the withdrawal of any order suspending the effectiveness of such Registration Statement, or the lifting of any suspension of the qualification or exemption from qualification of any Registrable Shares for sale in any jurisdiction in the United States; (f) furnish to the Holder of any Registrable Shares covered by such Registration Statement, Holder Counsel for such Holders and counsel for each managing underwriter, if any, without charge, one conformed copy of such Registration Statement, as declared effective by the SEC, and of each post-effective amendment thereto, in each case including financial statements and schedules and all exhibits and reports incorporated or deemed to be incorporated therein by reference; and deliver, without charge, such number of copies of the preliminary prospectus, any amended preliminary prospectus, each final Prospectus and any post-effective amendment or supplement thereto, as such Holder may reasonably request in order to facilitate the disposition of the Registrable Shares of such Holder covered by such Registration Statement in conformity with the requirements of the Securities Act; 17 11 (g) prior to any public offering of Registrable Shares covered by such Registration Statement, use commercially reasonable efforts to register or qualify such Registrable Shares for offer and sale under the securities or Blue Sky laws of such jurisdictions as the Holders of such Registrable Shares shall reasonably request in writing; provided, however, that the Company shall in no event be required to qualify generally to do business as a foreign corporation or as a dealer in any jurisdiction where it is not at the time so qualified or to execute or file a general consent to service of process in any such jurisdiction where it has not theretofore done so or to take any action that would subject it to general service of process or taxation in any such jurisdiction where it is not then subject; (h) subject to Section 2(d), upon the occurrence of any event contemplated by paragraph 5(d)(v) above, prepare a supplement or post-effective amendment to such Registration Statement or the related Prospectus or any document incorporated or deemed to be incorporated therein by reference and file any other required document so that, as thereafter delivered to the purchasers of the Registrable Shares being sold thereunder, such Prospectus will not contain an untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading; (i) use its best efforts to cause all Registrable Shares covered by such Registration Statement to be listed on each securities exchange or automated interdealer quotation system, if any, on which similar securities issued by the Company are then listed or quoted; (j) use its best efforts to comply with all applicable rules and regulations of the SEC and any securities exchange or regulatory body; (k) on or before the effective date of such Registration Statement, provide the transfer agent of the Company for the Registrable Shares with printed certificates for the Registrable Shares covered by such Registration Statement which are in a form eligible for deposit with The Depository Trust Company; (l) if such offering is an Underwritten Offering, make available for inspection by any Holder of Registrable Shares included in such Registration Statement, any underwriter participating in any offering pursuant to such Registration Statement, and any attorney, accountant or other agent retained by any such Holder or underwriter (collectively, the "Inspectors"), such financial and other records and other information, pertinent corporate documents and properties of any of the Company and its subsidiaries and affiliates (collectively, the "Records"), as shall be reasonably necessary to enable them to exercise their due diligence responsibilities; provided, however, that the Records that the Company determines, in good faith, to be confidential and which it notifies the Inspector in writing are confidential shall not be disclosed to any Inspector unless such Inspector signs a confidentiality agreement reasonably satisfactory to the Company; and (m) if such offering is an Underwritten Offering, enter into such agreements (including an underwriting agreement in form, scope and substance as is customary 18 12 in underwritten offerings) and take all such other appropriate and reasonable actions requested by the Holders of a majority of the Registrable Shares being sold in connection therewith (including those reasonably requested by the managing underwriters) in order to expedite or facilitate the disposition of such Registrable Shares, and in such connection, (i) use commercially reasonable efforts to obtain opinions of counsel to the Company and updates thereof (which counsel and opinions (in form, scope and substance) shall be reasonably satisfactory to the managing underwriters and Holder Counsel), addressed to each selling Holder of Registrable Shares covered by such Registration Statement and each of the underwriters as to the matters customarily covered in opinions requested in underwritten offerings and such other matters may be reasonably requested by such counsel and underwriters, (ii) use commercially reasonable efforts to obtain "cold comfort" letters and updates thereof from the independent certified public accountants of the Company (and, if necessary, any other independent certified public accountants of any subsidiary of the Company or of any business acquired by the Company for which financial statements and financial data are, or are required to be, included in the Registration Statement), addressed to each selling Holder of Registrable Shares covered by the Registration Statement (unless such accountants shall be prohibited from so addressing such letters by applicable standards of the accounting profession) and each of the underwriters, such letters to be in customary form and covering matters of the type customarily covered in "cold comfort" letters in connection with underwritten offerings and (iii) if requested and if an underwriting agreement is entered into, provide indemnification provisions and procedures substantially to the effect set forth in Section 7 hereof with respect to all parties to be indemnified pursuant to said Section 7. The above shall be done at each closing under such underwriting or similar agreement, or as and to the extent required thereunder. The Company may require each Holder of Registrable Shares covered by a Registration Statement to furnish such information regarding such Holder and such Holder's intended method of disposition of such Registrable Shares as it may from time to time reasonably request in writing. If any such information is not furnished within a reasonable period of time after receipt of such request, the Company may exclude such Holder's Registrable Shares from such Registration Statement. Each Holder of Registrable Shares covered by a Registration Statement agrees that, upon receipt of any notice from the Company of the happening of any event of the kind described in Section 5(d)(ii), 5(d)(iii), 5(d)(iv) or 5(d)(v) hereof, that such Holder shall forthwith discontinue disposition of any Registrable Shares covered by such Registration Statement or the related Prospectus until receipt of the copies of the supplemented or amended Prospectus contemplated by Section 5(h) hereof, or until such Holder is advised in writing (the "Advice") by the Company that the use of the applicable Prospectus may be resumed, and has received copies of any amended or supplemented Prospectus or any additional or supplemental filings which are incorporated, or deemed to be incorporated, by reference in such Prospectus (such period during which disposition is discontinued being an "Interruption Period") and, if requested by the Company, the Holder shall deliver to the Company (at the expense of the Company) all copies then in its possession, other than permanent file copies then in such holder's possession, of the Prospectus covering such Registrable Shares at the time of receipt of such request. 19 13 Each Holder of Registrable Shares covered by a Registration Statement further agrees not to utilize any material other than the applicable current preliminary prospectus or Prospectus in connection with the offering such Registrable Shares. 6. Registration Expenses. Whether or not any Registration Statement is filed or becomes effective, the Company shall pay all costs, fees and expenses incident to the Company's performance of or compliance with this Agreement, including (i) all registration and filing fees, including NASD filing fees, (ii) all fees and expenses of compliance with securities or Blue Sky laws, including reasonable fees and disbursements of counsel in connection therewith, (iii) printing expenses (including expenses of printing certificates for Registrable Shares and of printing preliminary and final prospectuses if the printing of prospectuses is requested by the Holders or the managing underwriter, if any), (iv) messenger, telephone and delivery expenses, (v) fees and disbursements of counsel for the Company and the Holder Counsel, (vi) fees and disbursements of all independent certified public accountants of the Company (including expense of any "cold comfort" letters required in connection with this Agreement) and all other persons retained by the Company in connection with this Agreement) and all other persons retained by the Company in connection with such Registration Statement, and (vii) all other costs, fees and expenses incident to the Company's performance or compliance with this Agreement. Notwithstanding the foregoing, the fees and expenses of any persons retained by any Holder, other than the Holder Counsel, and any discounts, commissions or brokers' fees or fees of similar securities industry professionals and any transfer taxes relating to the disposition of the Registrable Shares by a Holder, will be payable by such Holder and the Company will have no obligation to pay any such amounts. 7. Indemnification. (a) Indemnification by the Company. The Company shall, without limitation as to time, indemnify and hold harmless, to the full extent permitted by law, each Holder of Registrable Shares whose Registrable Shares are covered by a Registration Statement or Prospectus, each Affiliate of such Holder, the officers, directors and agents and employees of each of them, each Person who controls (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) each such Holder and the officers, directors, agents and employees of each such controlling Person, to the fullest extent lawful, from and against any and all losses, claims, damages, liabilities, judgments, costs (including, without limitation, costs of preparation and reasonable attorneys' fees) and expenses (collectively, "Losses"), as incurred, arising out of or based upon any untrue or alleged untrue statement of a material fact contained in such Registration Statement or Prospectus or in any amendment or supplement thereto or in any preliminary prospectus, or arising out of or based upon any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as the same are based upon information furnished in writing to the Company by or on behalf of such Holder expressly for use therein or by any underwriter in a Demand Registration; provided, however, that the Company shall not be liable to any such Holder to the extent that any such Losses arise out of or are based upon an untrue statement or alleged untrue statement or omission or alleged omission made in any preliminary prospectus if (i) having previously been furnished by or on behalf of the Company with copies of the 20 14 Prospectus, such Holder failed to send or deliver a copy of the Prospectus with or prior to the delivery of written confirmation of the sale of Registrable Shares by such Holder to the person asserting the claim from which such Losses arise and (ii) the Prospectus would have corrected in all material respects such untrue statement or alleged untrue statement or such omission or alleged omission; and provided further, however, that the Company shall not be liable in any such case to the extent that any such Losses arise out of or are based upon an untrue statement or alleged untrue statement or omission or alleged omission in the Prospectus, if (x) such untrue statement or alleged untrue statement, omission or alleged omission is corrected in all material respects in an amendment or supplement to the Prospectus and (y) having previously been furnished by or on behalf of the Company with copies of the Prospectus as so amended or supplemented, such Holder thereafter fails to deliver such Prospectus as so amended or supplemented, prior to or currently with the sale of Registrable Shares. In connection with any Underwritten Offering, the Company will also indemnify underwriters, selling brokers, dealer managers and similar securities industry professionals participating in the distribution, their officers and directors and each Person who controls (within the meaning of Section 15 of the Securities Act) such persons to the same extent as provided above with respect to indemnification of Holders of Registrable Shares, or on such other terms as are reasonable and customary and requested by the managing underwriter. (b) Indemnification by Holder of Registrable Shares. In connection with any Registration Statement in which a Holder is participating, such Holder shall furnish to the Company in writing such information as the Company reasonably requests for use in connection with such Registration Statement or the related Prospectus and agrees to indemnify, to the full extent permitted by law, the Company, its directors, officers, agents and employees, each Person who controls (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act) the Company and the directors, officers, agents and employees of such controlling Persons, from and against all Losses arising out of or based upon any untrue or alleged untrue statement of a material fact contained in such Registration Statement or the related Prospectus or any amendment or supplement thereto, or any preliminary prospectus, or arising out of or based upon any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, to the extent, but only to the extent, that such untrue or alleged untrue statement or omission or alleged omission is based upon any information so furnished in writing by or on behalf of such Holder to the Company expressly for use in such Registration Statement or Prospectus. (c) If any Person shall be entitled to indemnity hereunder (an "Indemnified Party"), the Indemnified Party shall give prompt notice to the party from which such indemnity is sought (the "Indemnifying Party") of any claim or of the commencement of any proceeding with respect to which the Indemnified Party seeks indemnification or contribution pursuant hereto; provided, however, that the delay or failure to so notify the Indemnifying Party shall not relieve the Indemnifying Party from any obligation or liability except to the extent that the Indemnifying Party has been prejudiced by such delay or failure. The Indemnifying Party shall have the right, exercisable by giving written notice to an Indemnified Party promptly after the receipt of written notice from such Indemnified Party of such claim or proceeding, to assume, at the Indemnifying Party's expense, the defense of any 21 15 such claim or proceeding, with counsel reasonably satisfactory to such Indemnified Party; provided, however, that (i) an Indemnified Party shall have the right to employ separate counsel in any such claim or proceeding and to participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party unless: (1) the Indemnifying Party agrees to pay such fees and expenses; (2) the Indemnifying Party fails promptly to assume the defense of such claim or proceeding or fails to employ counsel reasonably satisfactory to such Indemnified Party; or (3) the named parties to any proceeding (including impleaded parties) include both such Indemnified Party and the Indemnifying Party, and such Indemnifying Party shall have been advised by counsel that there may be one or more legal defenses available to it that are inconsistent with those available to the Indemnifying Party or that a conflict of interest is likely to exist among such Indemnified Party and any other indemnified parties (in which case the Indemnifying Party shall not have the right to assume the defense of such action on behalf of such Indemnified Party); and (ii) subject to clause (3) above, the Indemnifying Party shall not, in connection with any one such claim or proceeding or separate but substantially similar or related claims or proceedings in the same jurisdiction, arising out of the same general allegations or circumstances, be liable for the fees and expenses of more than one firm of attorneys (together with appropriate local counsel) at any time for all of the indemnified parties, or for fees and expenses that are not reasonable. Whether or not such defense is assumed by the Indemnifying Party, such Indemnified Party shall not be subject to any liability for any settlement made without its consent, which shall not be unreasonably withheld. The Indemnifying Party shall not consent to entry of any judgment or enter into any settlement that does not include as an unconditional term thereof the giving by the claimant or plaintiff to such Indemnified Party of a release, in form and substance reasonably satisfactory to the Indemnified Party, from all liability in respect of such claim or litigation for which such Indemnified Party would be entitled to indemnification hereunder. (d) Contribution. If the indemnification provided for in this Section 7 is unavailable to an Indemnified Party in respect of any Losses (other than in accordance with its terms), then each applicable Indemnifying Party, in lieu of indemnifying such Indemnified Party, shall contribute to the amount paid or payable by such Indemnified Party as a result of such Losses, in such proportion as is appropriate to reflect the relative fault of the Indemnifying Party, on the one hand, and such Indemnified Party, on the other hand, in connection with the actions, statements or omissions that resulted in such Losses as well as any other relevant equitable considerations. The relative fault of such Indemnifying Party, on the one hand, and Indemnified Party, on the other hand, shall be determined by reference to, among other things, whether any action in question, including any untrue statement of a material fact or omission or alleged omission to state a material fact, has been taken by, or relates to information supplied by, such Indemnifying Party or Indemnified Party, and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent any such action, statement or omission. The amount paid or payable by a party as a result of any Losses shall be deemed to include any legal or other fees or expenses incurred by such party in connection with any investigation or proceeding. The parties hereto agree that it would not be just and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation or by any other method of allocation that does not take account of the equitable considerations referred to in the immediately preceding paragraph. Notwithstanding the provision of this Section 7(d), an 22 16 Indemnifying Party that is a Holder shall not be required to contribute any amount which is in excess of the amount by which the total proceeds received by such Holder from the sale of the Registrable Shares sold by such Holder (net of all underwriting discounts and commissions) exceeds the amount of any damages that such Indemnifying Party has otherwise been required to pay by reason of such untrue or alleged untrue statement or omission or alleged omission. No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation. 8. Rule 144. If the Company shall have filed a registration statement pursuant to the requirements of Section 12 of the Exchange Act or a registration statement pursuant to the requirements of the Securities Act, the Company covenants that it will timely file the reports required to be filed by it under the Securities Act or the Exchange Act (including but not limited to the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144 adopted by the SEC under the Securities Act) and the rules and regulations adopted by the SEC thereunder (or if the Company is not required to file such reports, the Company will, upon the request of any Holder of Registrable Shares, make publicly available other information), and will take such further action as any Holder of Registrable Shares may reasonably request, all to the extent required from time to time to enable such Holder of Registrable Shares to sell Registrable Shares within the exemption provided by (i) Rule 144 under the Securities Act, as such Rule 144 may be amended from time to time, or (ii) any similar rule or regulation hereafter adopted by the SEC. Upon the request of any Holder of Registrable Shares, the Company will deliver to such Holder, a written statement as to whether it has complied with such requirements. 9. Rights Plan Amendment. Prior to the Effective Time (as defined in the Merger Agreement), the Company shall have adopted the HCR Rights Plan Amendment and from and after the Effective Time, the Company shall not amend or modify such Rights Plan Amendment without the consent of Stewart Bainum Jr. or his designee or adopt any stockholder rights plan after the Effective Time inconsistent with the purposes of the Rights Plan Amendment. 10. Miscellaneous. (a) Termination. This Agreement and the obligations of the Company and the Holders hereunder (other than Section 7 hereof) shall terminate on the first date on which no Registrable Shares remain outstanding. (b) Notices. All notices, requests, demands and other communications which are required or may be given under this Agreement shall be in writing and shall be deemed to have been duly given when received if personally delivered; when transmitted if transmitted by telecopy, electronic or digital transmission method; the day after it is sent, if sent for next day delivery to a domestic address by recognized overnight delivery service (e.g., Federal Express); and upon receipt, if sent by certified or registered mail, return receipt requested. In each case 23 17 notice shall be sent to the address for such party set forth on the signature page hereto, as such address may be changed by notice thereof conforming herewith. (c) Interpretation. When a reference is made in this Agreement to Sections, such reference shall be to a Section of this Agreement unless otherwise indicated. Headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the word "include", "includes" or "including" are used in this Agreement, they shall be deemed to be followed by the words "without limitation". This Agreement shall not be construed for or against either party by reason of the authorship or alleged authorship of any provision hereof or by reason of the status of the respective parties. All terms defined in this Agreement in the singular shall have the same comparable meanings when used in the plural and vice versa, unless otherwise specified. (d) Entire Agreement; No Third-Party Beneficiaries. This Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, both written and oral, among the parties with respect to the subject matter hereof and is not intended to confer upon any person other than the parties hereto any rights or remedies hereunder. (e) Assignment. Neither this Agreement nor any of the rights, interests, or obligations hereunder shall be assigned (whether by operation of law or otherwise) by any Holder without the consent of the Company, or by the Company without the consent of Holders of at least a majority in number of the Registrable Shares then outstanding provided that any Holder can assign its rights hereunder to a Permitted Transferee without the consent of the Company. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the parties and their respective successors and assigns. In no event shall any transferee of Common Stock be entitled, solely as a result of such transfer, to any of the benefits of this Agreement or to enforce the same. (f) Governing Law. The Laws of the State of Delaware shall govern the interpretation, validity and performance of the terms of this Agreement, regardless of the law that might be applied under principles of conflicts of law. Any suit, action or proceeding by a party hereto with respect to this Agreement, or any judgment entered by any court in respect of any thereof, may be brought in any state or federal court of competent jurisdiction in the State of Delaware, and each party hereto hereby submits to the exclusive jurisdiction of such courts for the purpose of any such suit, action, proceeding or judgment. By the execution and delivery of this Agreement, (i) the Company appoints The Corporation Trust Company, at its office in Wilmington, Delaware, as its agent upon which process may be served in any such suit, action or proceeding and (ii) each Stockholder appoints CSC/The United States Corporation Company in Wilmington, Delaware, as its agent upon which process may be served in any such suit, action or proceeding. Service of process upon such agent, together with notice of such service given to a party hereto in the manner provided in Section 9(b) hereof, shall be deemed in every respect effective service of process upon it in any suit, action or proceeding. Nothing herein shall in any way be deemed to limit the ability of a party hereto to serve any such writs, process or summonses in any other manner permitted by applicable Law. Each party hereto hereby irrevocably waives any objections which it may now or hereafter have to the laying of the venue 24 18 of any suit, action or proceeding arising out of or relating to this Agreement brought in any state or federal court of competent jurisdiction in the State of Delaware, and hereby further irrevocably waives any claim that any such suit, action or proceeding brought in any such court has been brought in any inconvenient forum. No suit, action or proceeding against a party hereto with respect to this Agreement may be brought in any court, domestic or foreign, or before any similar domestic or foreign authority other than in a court of competent jurisdiction in the State of Delaware, and each party hereto hereby irrevocably waives any right which it may otherwise have had to bring such an action in any other court, domestic or foreign, or before any similar domestic or foreign authority. (g) Severability. Each party agrees that, should any court or other competent authority hold any provision of this Agreement or part hereof to be null, void or unenforceable, or order any party to take any action inconsistent herewith or not to take an action consistent herewith or required hereby, the validity, legality and enforceability of the remaining provisions and obligations contained or set forth herein shall not in any way be affected or impaired thereby. Upon any such holding that any provision of this Agreement is null, void or unenforceable, the parties will negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated by this Agreement are consummated to the extent possible. Except as otherwise contemplated by this Agreement, to the extent that a party hereto took an action inconsistent herewith or failed to take action consistent herewith or required hereby pursuant to an order or judgment of a court or other competent authority, such party shall incur no liability or obligation unless such party did not in good faith seek to resist or object to the imposition or entering of such order or judgment. (h) Injunctive Relief. The parties acknowledge that it will be impossible to measure in money the damages that would be suffered if the parties fail to comply with any of the obligations herein imposed on them and that in the event of any such failure, an aggrieved person or entity will be irreparably damaged and will not have an adequate remedy at law. Any such person or entity shall, therefore, be entitled to injunctive relief, including specific performance, to enforce such obligations, and if any action should be brought in equity to enforce any of the provisions of this Agreement, none of the parties shall raise the defense that there is an adequate remedy at law. (i) Attorneys' Fees. If any party to this Agreement brings an action to enforce its rights under this Agreement, the prevailing party shall be entitled to recover its costs and expenses, including without limitation reasonable attorneys' fees, incurred in connection with such action, including any appeal of such action. (j) Cumulative Remedies. All rights and remedies of either party hereto are cumulative of each other and of every other right or remedy such party may otherwise have at law or in equity, and the exercise of one or more rights or remedies shall not prejudice or impair the concurrent or subsequent exercise of other rights or remedies. 25 19 (k) Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same instrument and shall become effective when executed and delivered by each of the parties. (l) Amendments and Waivers. Except as otherwise provided herein, the provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given, except in writing, by the Company and by the Holders of at least a majority in number of the Registrable Shares then outstanding. IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement as of the date first above written. HEALTH CARE AND RETIREMENT CORPORATION By: /s/ R. Jeffrey Bixler ---------------------------------- a duly authorized signatory 26 20 Holder Signature Page for Registration Rights Agreement Stewart Bainum /s/ Stewart Bainum ------------------------ Stewart Bainum, Jr. /s/ Stewart Bainum, Jr. ------------------------ Bainum Associates Limited Partnership /s/ Stewart Bainum, Jr. By: ------------------------ Stewart Bainum, Jr. Its Managing General Partner MC Investment Limited Partnership /s/ Stewart Bainum, Jr. By: ------------------------ Stewart Bainum, Jr. Its Managing General Partner Realty Investment Company, Inc. /s/ Stewart Bainum By: ------------------------ Stewart Bainum President Mid Pines Associates Limited Partnership /s/ Stewart Bainum, Jr. By: ------------------------ Stewart Bainum, Jr. Its Managing General Partner The Stewart Bainum Declaration of Trust /s/ Stewart Bainum By: ------------------------ Stewart Bainum Trustee The Jane L. Bainum Declaration of Trust /s/ Jane L. Bainum By: ------------------------ Jane L. Bainum Trustee EX-99.1 4 PRESS RELEASE DATED SEPTEMBER 24, 1998 1 NEWS RELEASE Exhibit 99.1 FOR IMMEDIATE RELEASE: HEALTH CARE AND RETIREMENT CORPORATION AND MANOR CARE, INC. ANNOUNCE STOCKHOLDER APPROVALS OF MERGER TOLEDO, Oh. and GAITHERSBURG, Md. -- Sept. 24, 1998 -- Health Care and Retirement Corporation (NYSE-HCR) and Manor Care, Inc. (NYSE-MNR) announced that at separate special meetings of their respective stockholders held today that the stockholders of HCR approved the Amended and Restated Agreement and Plan of Merger by and among HCR, Manor Care and Catera Acquisition Corp., a wholly owned subsidiary of HCR and the transactions contemplated by the Merger Agreement, and the stockholders of Manor Care approved the Merger Agreement and the transactions contemplated by the Merger Agreement. As a result of the Merger, Manor Care will become a wholly owned subsidiary of HCR. The combined company will immediately be renamed HCR Manor Care, Inc. The shares of HCR Manor Care will continue to trade under the symbol HCR. HCR and Manor Care anticipate that the Merger will be consummated on Friday, Sept. 25, 1998. Under the terms of the Merger Agreement, each share of Manor Care Common Stock will be exchanged for one share of HCR Manor Care Common Stock as soon as reasonably practicable after the consummation of the Merger. The above statements include forward-looking statements. HCR and Manor Care caution investors that any forward-looking statements made by either of them are not guarantees of future performance. Numerous factors exist which in some cases have caused, and in the future may cause, results to differ materially from such forward-looking statements. Contact: Geoffrey G. Meyers of Health Care & Retirement Corporation, 419-252-5345; or Kimberly A. Holland of Manor Care, Inc., 310-979-4000; or Daniel H. Burch, 212-929-5748, or Larry Dennedy, 212-929-5239, both of MacKenzie Partners, Inc. EX-99.2 5 PRESS RELEASE DATED SEPTEMBER 25, 1998 1 Exhibit 99.2 PRESS RELEASE: Contact: Geoffrey G. Meyers, Chief Financial Officer (419) 252-5545 Internet: gmeyers@COMPUSERVE.COM Web Site - http://www.businesswire.com/cnn/hcr.htm Toledo, Ohio, September 25, 1998 - HCR Manor Care, Inc. (HCR), announced that the merger of Health Care and Retirement Corporation and Manor Care Inc. was completed today. Both companies' shareholders had voted to approve the merger on September 24, 1998. "This is a merger of the two best companies in our industry", said Paul A. Ormond, President and Chief Executive Officer of the combined company. "The combination of top facilities with a strong record of performance will provide a tremendous foundation for our multi-faceted growth strategy for HCR Manor Care". HCR Manor Care has more than 55,000 employees providing high quality care through a network of long term centers, assisted living facilities, outpatient rehabilitation clinics, home health care offices, and management service for professional organizations. HCR Manor Care shares will continue to be traded on the New York Stock Exchange under the ticker symbol HCR. -----END PRIVACY-ENHANCED MESSAGE-----