<PAGE>
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON AUGUST 30, 1994
REGISTRATION NO. 33 -
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
----------------
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
----------------
NATIONAL MEDICAL ENTERPRISES, INC.
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
NEVADA 95-2557091
(STATE OR OTHER JURISDICTION (I.R.S. EMPLOYER
OF INCORPORATION OR IDENTIFICATION NO.)
ORGANIZATION)
2700 COLORADO AVENUE
SANTA MONICA, CALIFORNIA 90404
(310) 998-8000
(ADDRESS INCLUDING ZIP CODE AND TELEPHONE NUMBER, INCLUDING AREA CODE,
OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)
SCOTT M. BROWN
SENIOR VICE PRESIDENT, GENERAL COUNSEL AND SECRETARY
2700 COLORADO AVENUE
SANTA MONICA, CALIFORNIA 90404
(310) 998-8000
(NAME, ADDRESS INCLUDING ZIP CODE AND
TELEPHONE NUMBER, INCLUDING AREA CODE, OF AGENT FOR SERVICE)
----------------
Approximate date of commencement of proposed sale to the public: As soon as
practicable after the effective date of this Registration Statement in
accordance with the terms of the Trust instruments.
----------------
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, please check the following box. [X]
----------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
=============================================================================================
PROPOSED PROPOSED
MAXIMUM MAXIMUM
AMOUNT OFFERING AGGREGATE AMOUNT OF
TITLE OF TO BE PRICE PER OFFERING REGISTRATION
SECURITIES TO BE REGISTERED REGISTERED UNIT* PRICE* FEE
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, par value $.075 per
share.......................... 1,500,000 $18.06 $27,090,000 $9,342.00
=============================================================================================
</TABLE>
* Pursuant to Rule 457, these prices are estimated solely for the purpose of
calculating the registration fee and are based upon the average of the high
and low sales prices of the Registrant's Common Stock on the New York Stock
Exchange on August 23, 1994.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933, AS AMENDED, OR UNTIL THE REGISTRATION STATEMENT
SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID
SECTION 8(A), MAY DETERMINE.
- --------------------------------------------------------------------------------
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<PAGE>
P R O S P E C T U S
1,500,000 SHARES
NATIONAL MEDICAL ENTERPRISES, INC.
COMMON STOCK
----------------
The shares of Common Stock offered hereby will be sold by a certain
shareholder of National Medical Enterprises, Inc. ("NME" or the "Company"). See
"Selling Shareholder." None of the proceeds from the sale of the Common Stock
will be received by the Company. The shares will be offered for sale by the
Selling Shareholder from time to time in brokerage transactions on the New York
Stock Exchange or the Pacific Stock Exchange or through brokers in the over-
the-counter market at market prices prevailing at the time of sale or in one or
more negotiated transactions at prices acceptable to the Selling Shareholder.
The Common Stock is listed on the New York Stock Exchange and the Pacific
Stock Exchange. On August 23, 1994 the last reported sale price of the Common
Stock on the New York Stock Exchange was $18.13 per share.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE DATE OF THIS PROSPECTUS IS AUGUST , 1994
<PAGE>
AVAILABLE INFORMATION
NME is subject to the informational requirements of the Securities Exchange
Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files
reports and other information with the Securities and Exchange Commission (the
"Commission"). Reports, proxy statements and other information, as of
particular dates, concerning directors and officers, their remuneration,
options granted to them, the principal holders of securities of NME and any
material interest of such persons in transactions with NME, is distributed to
shareholders of NME and filed with the Commission. Such reports, proxy
statements and other information can be inspected and copied at the offices of
the Commission, at prescribed rates, at Room 1024, Judiciary Plaza, 450 Fifth
Street N.W., Washington, D.C. 20549; Northwestern Atrium Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661; and 7 World Trade Center,
Suite 1300, New York, New York 10048. Copies of such material also can be
obtained upon written request addressed to the Securities and Exchange
Commission, Public Reference Section, Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. Such reports, proxy statements and
other information concerning NME also may be inspected at the offices of the
New York Stock Exchange and the Pacific Stock Exchange.
This Prospectus constitutes a part of a Registration Statement on Form S-3
filed by the Company with the Commission under the Securities Act of 1933, as
amended (the "Securities Act"). This Prospectus omits certain information
contained in the Registration Statement in accordance with the rules and
regulations of the Commission. Reference is hereby made to the Registration
Statement and related exhibits for further information with respect to the
Company and the Common Stock offered hereby. Statements contained herein
concerning the provisions of any document are not necessarily complete and, in
each instance, reference is made to the copy of such document filed as an
exhibit to the Registration Statement or otherwise filed with the Commission.
Each such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents, which have been filed by NME with the Commission,
are hereby incorporated by reference in this Prospectus and made a part hereof:
(i) Annual Report on Form 10-K for the fiscal year ended May 31, 1994;
(ii) The description of the Common Stock which is contained in the Company's
Registration Statement on Form 8-A filed with the Commission on April 8,
1971, pursuant to Section 12 of the Exchange Act, including any
amendments or reports filed for the purpose of updating such
description; and
(iii) The description of certain preferred stock purchase rights which have
attached to the Common Stock which is contained in the Company's
Registration Statement on Form 8-A filed with the Commission on
December 9, 1988, pursuant to Section 12 of the Exchange Act,
including any amendments or reports filed for the purpose of updating
such description.
In addition, all documents filed by NME pursuant to Sections 13(a), 13(c) 14
or 15(d) of the Exchange Act subsequent to the date of this Prospectus and
prior to the termination of the offering of the securities shall be deemed to
be incorporated by reference into this Prospectus and to be a part hereof from
the respective dates of filing of such documents. Any statement contained in a
document incorporated or deemed to be incorporated by reference herein shall be
deemed to be modified or superseded for purposes of this Prospectus to the
extent that a statement contained herein, or in any other subsequently filed
document that also is or is deemed to be incorporated by reference herein,
modifies or supersedes such statement. Any such statement so modified or
superseded shall not be deemed, except as so modified or superseded, to
constitute a part of this Prospectus.
NME will provide without charge to each person to whom this Prospectus is
delivered, on the request of any such person, a copy of any or all of the
foregoing documents incorporated by reference herein (other than the exhibits
to such documents). Written or telephone requests should be directed to Scott
M. Brown, Senior Vice President, Secretary and General Counsel, National
Medical Enterprises, Inc., 2700 Colorado Avenue, Santa Monica, California
90404, telephone (310) 998-8000.
2
<PAGE>
THE COMPANY
National Medical Enterprises, Inc. ("NME" or the "Company") is a leading
investor-owned health care company with its core business being the operation
of domestic and international general hospitals.
Unless the context otherwise requires, "NME" or the "Company" refers to
National Medical Enterprises, Inc. and its subsidiaries. The Company's
executive offices are located at 2700 Colorado Avenue, Santa Monica, California
90404, telephone (310) 998-8000.
SELLING SHAREHOLDER
The shares of Common Stock being offered hereunder are being sold by the
United States Trust Company of New York ("Selling Shareholder"), as trustee,
pursuant to the terms of the 1994 NME Supplemental Executive Retirement Plan
Trust, as amended (the "SERP Trust"), and the 1994 Deferred Compensation Plan
Trust, as amended (the "DCP Trust"). The Company has adopted and maintains the
National Medical Enterprises, Inc. Supplemental Executive Retirement Plan, as
amended (the "SERP"), and the National Medical Enterprises, Inc. Deferred
Compensation Plan, as amended (the "DCP"), to attract, retain, motivate and
provide financial security to certain management employees. NME established the
SERP Trust and DCP Trust and has contributed 1,000,000 and 500,000 shares of
Common Stock, respectively, into the trusts to secure the benefits payable to
participants and/or their beneficaries under the SERP and the DCP. The shares
of Common Stock are being registered pursuant to registration rights agreements
between the Company and the Selling Shareholder. The following table sets forth
information as of August 23, 1994 with respect to the Selling Shareholder.
<TABLE>
<CAPTION>
BENEFICIAL OWNERSHIP NUMBER OF BENEFICIAL OWNERSHIP
NAME OF SELLING PRIOR TO OFFERING SHARES AFTER OFFERING
SHAREHOLDER NUMBER OF SHARES BEING OFFERED NUMBER OF SHARES
--------------- -------------------- ------------- --------------------
<S> <C> <C> <C>
United States Trust Com-
pany of New York, as
trustee of SERP Trust.. 1,000,000* 1,000,000* 0
United States Trust Com-
pany of New York, as
trustee of DCP Trust... 500,000* 500,000* 0
</TABLE>
- --------
* Represents less than 1% of outstanding shares of the Company's Common Stock.
The Company will pay all expenses incurred in connection with the offering
except for brokerage fees or any underwriting discounts or commissions which
shall be paid by the Selling Shareholder. The Company has agreed to indemnify
the Selling Shareholder against certain liabilities, including liabilities
arising under the Securities Act.
3
<PAGE>
PLAN OF DISTRIBUTION
The shares may be sold from time to time by the Selling Shareholder in any
one or more transactions (which may involve block transactions) on the New York
Stock Exchange, on the Pacific Stock Exchange, in the over-the-counter market,
on NASDAQ and on any exchange on which the Common Stock may then be listed, or
otherwise in negotiated transactions or a combination of such methods of sale
at market prices prevailing at the time of sale, or at negotiated prices. The
Selling Shareholder may effect such transactions by selling shares to or
through broker-dealers, and such broker-dealers may sell the shares as agent or
may purchase such shares as principal and resell them for their own account
pursuant to this Prospectus. Such broker-dealers may receive compensation in
the form of underwriting discounts, concessions or commissions from the Selling
Shareholder and/or purchasers of shares for whom they may act as agent (which
compensation may be in excess of customary commissions).
In connection with such sales, the Selling Shareholder and any participating
brokers or dealers may be deemed to be "underwriters" as defined in the
Securities Act in which event all brokerage commissions or discounts and other
compensation received by such brokers or dealers may be deemed underwriting
compensation under the Securities Act. In addition, any of the securities that
qualify for sale pursuant to Rule 144 may be sold under Rule 144 rather than
pursuant to this Prospectus.
In order to comply with certain state securities laws, if applicable, the
Common Stock will not be sold in a particular state unless such securities have
been registered or qualified for sale in such state or an exemption from
registration or qualification is available and complied with.
No person is authorized to give any information or to make any
representation, other than those contained in this Prospectus, and any
information or representations not contained in this Prospectus must not be
relied upon as having been authorized. This Prospectus does not constitute an
offer to sell or solicitation of an offer to buy any securities other than the
registered securities to which it relates. This Prospectus does not constitute
an offer to sell or a solicitation of an offer to buy such securities under any
circumstances where such an offer or solicitation is unlawful. Neither the
delivery of this Prospectus nor any sales made hereunder shall, under any
circumstances, create any implication that there has been no change in the
affairs of the Company since the date hereof or that the information contained
herein is correct as of any time subsequent to its date.
LEGAL MATTERS
Certain legal matters with respect to the Common Stock offered hereby will be
passed upon for the Company by Scott M. Brown, Senior Vice President and
General Counsel of the Company.
As of August 29, 1994, Mr. Brown owned 2,400 shares of Common Stock, had been
granted options to purchase 93,002 shares of Common Stock and had the right to
acquire 199,489 shares of Common Stock.
EXPERTS
The audited consolidated financial statements and schedules included in the
Company's Annual Report on Form 10-K as of the year ended May 31, 1994 and 1993
and for each of the years in the three-year period ended May 31, 1994 have been
incorporated by reference in reliance upon the report of KPMG Peat Marwick LLP,
independent certified public accountants, incorporated by reference herein and
upon the authority of such firm as experts in auditing and accounting.
4
<PAGE>
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- -------------------------------------------------------------------------------
No dealer, salesperson or other individual has been authorized to give any
information or to make any representations other than those contained in this
Prospectus in connection with the offering covered by this Prospectus. If
given or made, such information or representations must not be relied upon as
having been authorized by the Company or the Selling shareholder. This Pro-
spectus does not constitute an offer to sell or a solicitation of an offer to
buy the Common Stock in any jurisdiction where, or to any person to whom, it
is unlawful to make such offer or solicitation. Neither the delivery of this
Prospectus nor any sale made hereunder shall, under any circumstances, create
any implication that there has not been any change in the facts set forth in
this Prospectus or in the affairs of the Company since the date hereof.
----------------
CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Available Information...................................................... 2
Incorporation of Certain Documents
by Reference.............................................................. 2
The Company................................................................ 3
Selling Shareholder........................................................ 3
Plan of Distribution....................................................... 4
Legal Matters.............................................................. 4
Experts.................................................................... 4
</TABLE>
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1,500,000 SHARES
----------------
NATIONAL MEDICAL ENTERPRISES, INC.
COMMON STOCK
----------------
PROSPECTUS
----------------
, 1994
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
<TABLE>
<S> <C>
Securities and Exchange Commission fee........................... $ 9,342
Blue sky fees and expenses....................................... 2,000
Printing and engraving fees...................................... 1,500
Accounting fees and expenses..................................... 3,000
Miscellaneous.................................................... 6,000
-------
Total........................................................ $21,842
=======
</TABLE>
All expenses incurred in connection with the offering will be paid by the
Company.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Nevada law and the Company's Restated Articles of Incorporation and Restated
By-laws permit indemnification of Directors and officers in terms sufficiently
broad to indemnify Directors and officers under certain circumstances for
liabilities (including expense reimbursement) arising under the Securities Act
of 1933 (the "Securities Act"). The Company also maintains an indemnification
agreement with each of its Directors and any officer designated by the
Company's Board of Directors insuring them against certain liabilities incurred
by them in the performance of their duties, including liabilities under the
Securities Act.
ITEM 16. EXHIBITS.
(4) Instruments Defining the Rights of Security Holders, Including
Indentures
(a) DCP Trust Registration Rights Agreement
(b) SERP Trust Registration Rights Agreement
(c) 1994 NME Deferred Compensation Plan Trust (Incorporated by
reference to Exhibit 10(aaa) to Registrant's Annual Report on Form
10-K dated August 25, 1994)
(d) 1994 NME Supplemental Executive Retirement Plan Trust (Incorporated
by reference to Exhibit 10(uu) to Registrant's Annual Report on
Form 10-K dated August 25, 1994)
(5) Opinion re Legality
(a) Opinion of Scott M. Brown
(23) Consents of Experts and Counsel
(a) Consent of KPMG Peat Marwick LLP
(b) Consent of Scott M. Brown (included in his opinion filed as Exhibit
5).
(24) Power of Attorney
(a) Power of Attorney (included on page II-4 of this Registration
Statement).
II-1
<PAGE>
ITEM 17. UNDERTAKINGS.
The undersigned Registrant hereby undertakes:
(a) (1)To file, during any period in which offers or sales are being made, a
post-effective amendment to this Registration Statement to include any material
information with respect to the plan of distribution not previously disclosed
in the Registration Statement or any material change to such information in the
Registration Statement.
(2)That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof.
(3)To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
(b) For purposes of determining any liability under the Securities Act, each
filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of
the Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
(h) Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and controlling persons of the
Registrant pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities Act
and is, therefore, unenforceable. In the event that a claim for indemnification
against such liabilities (other than the payment by the Registrant of expenses
incurred or paid by a director, officer or controlling person of the Registrant
in the successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-2
<PAGE>
SIGNATURES
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THE REGISTRANT
CERTIFIES THAT IT HAS REASONABLE GROUNDS TO BELIEVE THAT IT MEETS ALL OF THE
REQUIREMENTS FOR FILING ON FORM S-3 AND HAS DULY CAUSED THE REGISTRATION
STATEMENT TO BE SIGNED ON ITS BEHALF BY THE UNDERSIGNED, THEREUNTO DULY
AUTHORIZED IN THE CITY OF SANTA MONICA, STATE OF CALIFORNIA ON AUGUST 30, 1994.
National Medical Enterprises, Inc.
By /s/ Scott M. Brown
_____________________________________
Scott M. Brown
Senior Vice President and Secretary
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, THAT EACH PERSON WHOSE SIGNATURE APPEARS IN
THIS REGISTRATION STATEMENT IN ANY CAPACITY HEREBY CONSTITUTES AND APPOINTS
JEFFREY C. BARBAKOW, RAYMOND L. MATHIASEN AND SCOTT M. BROWN, AND EACH OF THEM,
HIS OR HER TRUE AND LAWFUL ATTORNEYS-IN-FACT AND AGENTS, EACH ACTING ALONE,
WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION, FOR HIM OR HER AND IN HIS
OR HER NAME, PLACE AND STEAD, IN ANY AND ALL CAPACITIES, TO SIGN ANY AND ALL
AMENDMENTS (INCLUDING POST-EFFECTIVE AMENDMENTS) TO THIS REGISTRATION STATEMENT
AND TO FILE THE SAME, WITH ALL EXHIBITS THERETO, AND OTHER DOCUMENTS IN
CONNECTION THEREWITH, WITH THE SECURITIES AND EXCHANGE COMMISSION, GRANTING
UNTO SAID ATTORNEYS-IN-FACT AND AGENTS, EACH ACTING ALONE, FULL POWER AND
AUTHORITY TO DO AND PERFORM EACH AND EVERY ACT AND THING REQUISITE AND
NECESSARY TO BE DONE IN AND ABOUT THE PREMISES, AS FULLY TO ALL INTENTS AND
PURPOSES AS HE OR SHE MIGHT OR COULD DO IN PERSON, HEREBY RATIFYING AND
CONFIRMING ALL THAT SAID ATTORNEYS-IN-FACT AND AGENTS, EACH ACTING ALONE, OR
HIS OR HER SUBSTITUTE OR SUBSTITUTES, MAY LAWFULLY DO OR CAUSE TO BE DONE BY
VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS REGISTRATION
STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE CAPACITIES INDICATED
AS OF AUGUST 30, 1994.
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Jeffrey C. Barbakow Chairman, Chief Executive
____________________________________ Officer and Director
Jeffrey C. Barbakow (Principal Executive
Officer)
/s/ Michael H. Focht, Sr. President, Chief Operating
____________________________________ Officer and Director
Michael H. Focht, Sr.
/s/ Raymond L. Mathiasen Senior Vice President and
____________________________________ Chief Financial Officer
Raymond L. Mathiasen (Principal Financial and
Accounting Officer)
/s/ John C. Bedrosian Director
____________________________________
John C. Bedrosian
</TABLE>
II-3
<PAGE>
<TABLE>
<CAPTION>
SIGNATURE TITLE
--------- -----
<S> <C>
/s/ Bernice Bratter Director
____________________________________
Bernice Bratter
/s/ Maurice J. DeWald Director
____________________________________
Maurice J. DeWald
/s/ Peter de Wetter Director
____________________________________
Peter de Wetter
/s/ Edward Egbert, M.D. Director
____________________________________
Edward Egbert, M.D.
/s/ Raymond A. Hay Director
____________________________________
Raymond A. Hay
/s/ Nita P. Heckendorn Director
____________________________________
Nita P. Heckendorn
/s/ Lester B. Korn Director
____________________________________
Lester B. Korn
/s/ James P. Livingston Director
____________________________________
James P. Livingston
/s/ Richard S. Schweiker Director
____________________________________
Richard S. Schweiker
</TABLE>
II-4
<PAGE>
DCP TRUST REGISTRATION RIGHTS AGREEMENT
---------------------------------------
THIS DCP TRUST REGISTRATION RIGHTS AGREEMENT (the "Agreement"), dated as of
__________ ___, 1994, is entered into by and between NATIONAL MEDICAL
ENTERPRISES, INC. (the "Company"), a Nevada corporation with offices at 2700
Colorado Avenue, Santa Monica, California 90404 and UNITED STATES TRUST COMPANY
OF NEW YORK, a New York corporation with offices at 114 West 47th Street, New
York, New York 10036 (the "Trustee"), as trustee U/A dated May __, 1994 for the
1994 NME Deferred Compensation Plan Trust ("the Trust").
RECITALS
A. The Company has adopted the National Medical Enterprises, Inc. Deferred
Compensation Plan (the "Plan").
B. The Company has established the Trust pursuant to that certain Trust
Agreement between the Company and the Trustee dated May ___, 1994 (the "Trust
Agreement") in order to secure the benefits payable to participants and their
beneficiaries in accordance with the Plan.
C. The Trustee has agreed to serve as trustee under the Trust.
D. Pursuant to the Trust Agreement, the Company has agreed to deposit with
the Trustee, as trustee of the Trust, 5,000,000 shares of National Medical
Enterprises, Inc. Common Stock, $.075 par value per share (the "Common Stock").
E. The Company and the Trustee desire to set forth the registration rights
to be granted to the Trustee in connection with its holding of the Common Stock.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and conditions set forth in this Agreement and the Trust Agreement
and other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Certain Definitions. The following terms are defined as follows:
-------------------
"Commission" shall mean the Securities and Exchange Commission or any other
------------
federal agency at the time administering the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
------------
any successor federal statute, and the rules and regulations of the Commission
issued under the Exchange Act, as they each may, from time to time, be in
effect.
"Holder" shall mean the Trustee and any successor trustee or co-trustee
--------
appointed in accordance with the terms of the Trust Agreement.
1
<PAGE>
"Person" shall mean any natural person, partnership, corporation,
--------
association or other legal entity.
"Registration Expenses" shall mean all expenses incurred by the Company in
-----------------------
complying with Sections 2.1, 2.2 and 2.8 hereof, including, without limitation,
all registration and filing fees, printing expenses, registrar and transfer
agent fees, exchange listing fees, photocopy and courier fees, fees and
disbursements of counsel for the Company, reasonable fees and disbursements of
special counsel for the Holder, Blue Sky fees and expenses, and the expense for
any special audits incident to or required by any such registration (but
excluding the compensation of regular employees of the Company, which shall be
paid in any event by the Company).
"Registrable Securities" shall mean the Shares and/or shares of Common
------------------------
Stock issued as a dividend or other distribution with respect to, or in exchange
or in replacement of, the Shares.
"Register", "Registered" and "Registration" shall refer to a registration
---------- ------------ --------------
effected by preparing and filing a Registration Statement in compliance with the
Securities Act, and the declaration or ordering of the effectiveness of such
registration statement.
"Registration Statement" means a registration statement filed by the
------------------------
Company with the Commission for a public offering and sale of securities of the
Company (other than a registration statement on Form S-4 or Form S-8, or their
successors, or any other form for a limited purpose, or any registration
statement covering only securities proposed to be issued in exchange for
securities or assets of another corporation).
"Rule 144" shall mean Rule 144 promulgated under the Securities Act.
----------
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
----------------
successor federal statute, and the rules and regulations of the Commission
issued under the Securities Act, as they each may, from time to time, be in
effect.
"Selling Expenses" shall mean all underwriting discounts and selling
------------------
commissions applicable to the sale.
"Shares" shall mean the one million shares of Common Stock deposited with
--------
the Trustee pursuant to the Trust Agreement.
2. Trustee Registration Rights.
---------------------------
2.1 Trustee Requested Registration. In the event the Company shall
------------------------------
receive from the Holder a written request that the Company effect a registration
under the Securities Act (other than a registration on Form S-3, which is
provided for in Section 2.8 hereof, or any related form of Registration
Statement) with respect to at least 30% of the Registrable Securities (or any
lesser percentage if the aggregate offering price to the public would be at
least $2,000,000):
2
<PAGE>
(a) The Company will promptly give written notice of the proposed
registration to any other Holder, if there are co-trustees of the Trust who (i)
have been appointed co-trustees in accordance with the Trust Agreement and (ii),
through an amendment to this Agreement, have become parties to this Agreement;
and
(b) The Company will as soon as practicable, use its diligent
best efforts to effect such registration (including, without limitation, the
execution of an undertaking to file post-effective amendments, appropriate
qualification under applicable Blue Sky or other state securities laws and
appropriate compliance with applicable regulations issued under the Securities
Act) as may be so requested and as would permit or facilitate the sale and
distribution of such Registrable Securities as are specified in such request,
together with such Registrable Securities of any other Holder joining in such
request as specified in a written request received by the Company within 20 days
after receipt, by such Holder, of the Section 2.1(d) written notice from the
Company; provided that the Company shall not be obligated to take any action to
effect any registration, qualification or compliance pursuant to this Section
2.1 if the Company gives notice within 30 days of the registration request that
it is engaged, or has fixed plans to engage within 30 days of the time of the
request, in a firmly underwritten registered public offering. Subject to the
foregoing paragraph and to Section 2.1(d), the Company shall file a registration
statement covering the Registrable Securities so requested to be registered as
soon as practicable after receipt of the request of the Holder initiating the
registration request hereunder (the "Initiating Holder"). Absent the written
consent of a majority in interest of the Initiating Holders, the Company shall
not include in any registration under this Section 2.1 any shares of Common
Stock other than those specified by the Holder pursuant to the foregoing
provisions.
(c) If the Initiating Holder intends to distribute the
Registrable Securities covered by its request by means of an underwriting, it
shall so advise the Company as a part of its request made pursuant to Section
2.1 and the Company shall include such information in the written notice
referred to in Section 2.1(a). The right of any Holder to registration pursuant
to Section 2.1 shall be conditioned upon such Holder's participation in such
underwriting. The Company and the Holder shall enter into an underwriting
agreement, in customary form, with the underwriter or underwriters selected for
such underwriting by the Initiating Holder. Notwithstanding any other provision
of this Section 2.1, if the underwriter determines that marketing factors
require a limitation of the number of shares to be underwritten and so advises
the Company in writing, then the Company shall so advise all Holders
participating in the registration and underwriting. If the amount of shares
proposed to be registered remains in excess of the number satisfactory to the
underwriter, the number of shares of Registrable Securities included in the
registration shall be further reduced to a number satisfactory to the
underwriter. In such event, the number of shares of Registrable Securities that
may be included in the registration and underwriting shall be allocated among
all Holders in proportion, as nearly as practicable, to the respective amounts
of Registrable Securities owned by such Holders at the time of filing the
registration statement. No Registrable Securities excluded from the underwriting
by reason of the underwriter's marketing limitation shall be included in such
registration. If any Holder disapproves of the terms of the underwriting, such
Person may elect
3
<PAGE>
to withdraw therefrom by written notice to the Company, the underwriter and the
Initiating Holder. The Registrable Securities and/or other securities so
withdrawn from such underwriting also shall be withdrawn from the registration;
provided, however, that, if by the withdrawal of such Registrable Securities a
- -------- -------
greater number of Registrable Securities held by other Holders may be included
in such registration (up to the maximum of any limitation imposed by the
underwriters), then the Company shall offer to all Holders who have included
Registrable Securities in the registration the right to include additional
Registrable Securities in the same proportion used above in determining the
underwriter limitation.
(d) If the Company shall furnish to the Initiating Holder a
certificate signed by the Chief Executive Officer of the Company stating that,
in the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed on or before the date filing would be required and it is
therefore essential to defer the filing of such registration statement, then the
Company may direct that such request for registration be delayed for a period
not in excess of 60 days, such right to delay a request to be exercised by the
Company not more than once in any 12-month period.
2.2 Company Registration.
--------------------
(a) If at any time or from time to time, the Company shall
determine to register any of its Common Stock, for its own account or for the
account of others (other than the Holder) pursuant to a Registration Statement,
other than a registration on any registration form which does not include
substantially the same information (other than information relating to the
selling stockholders or their plan of distribution) as would be required to be
included in a registration statement covering the sale of Registrable
Securities, the Company will:
(i) promptly give to the Holder written notice thereof (which
shall include a list of the jurisdictions in which the Company intends to
attempt to qualify such securities under the applicable Blue Sky or other state
securities laws); and
(ii) include in such registration (and any related
qualification under Blue Sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities specified in a written request
by the Holder received by the Company within 20 days after the Holder received
the Section 2.2(a)(i) written notice from the Company.
(b) If the registration of which the Company gives notice is for
a registered public offering involving an underwriting, the Company shall so
advise the Holder as a part of the written notice given pursuant to Section
2.2(a)(i). In such event, the right of any Holder to registration pursuant to
Section 2.2 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company and
the other holders distributing their securities through such
4
<PAGE>
underwriting) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by the Company. If
the underwriter determines that marketing factors require a limitation of the
number of shares to be underwritten, the underwriter may exclude certain of the
Registrable Securities from such registration and underwriting, as follows. The
Company shall so advise all Holders (except those Holders who have indicated to
the Company their decision not to distribute any of their Registrable Securities
through such underwriting) of such fact and of the number of shares of
Registrable Securities that may be included in the registration and
underwriting. The number of shares of Registrable Securities that may be
included in the registration and underwriting shall be allocated among such
Holders in proportion, as nearly as practicable, to the respective amounts of
Registrable Securities owned by them at the time of filing the registration
statement. Notwithstanding the foregoing, no exclusion of Registrable
Securities hereunder shall result in the Holders being unable to register, in
the aggregate, less than the lesser of (x) the aggregate number of Registrable
Securities sought to be registered by the Holders hereunder or (y) 25% of the
total number of shares registered in such registration. No Registrable
Securities excluded from the underwriting by reason of the underwriter's
marketing limitation shall be included in such registration. If any Holder
disapproves of the terms of any such underwriting, such person may elect to
withdraw therefrom by written notice to the Company and the underwriter. The
Registrable Securities and/or other securities so withdrawn from such
underwriting shall also be withdrawn from such registration; provided, however,
-------- -------
that, if by the withdrawal of such Registrable Securities a greater number of
Registrable Securities held by other Holders may be included in such
registration (up to the maximum of any limitation imposed by the underwriters),
then the Company shall offer to all holders who have included Registrable
Securities in the registration the right to include additional Registrable
Securities in the same proportion used above in determining the underwriter
limitation.
2.3 Expenses of Registration. All Registration Expenses incurred in
------------------------
connection with any registration, qualification or compliance pursuant to
Section 2.1, 2.2 or 2.8 shall be borne by the Company and all Selling Expenses
shall be borne by the holders of the securities so registered pro rata on the
basis of the number of shares so registered.
2.4 Registration Procedures. In the case of each registration,
-----------------------
qualification or compliance effected by the Company pursuant to this Section 2,
the Company will keep each Holder advised in writing as to the initiation of
each registration, qualification and compliance and as to the completion
thereof. At its expense the Company will:
(a) Keep such registration, qualification or compliance effective
for a period of 180 days or until the Holder has completed the distribution
described in the registration statement relating thereto, whichever first
occurs;
(b) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the
5
<PAGE>
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement;
(c) Furnish to the Holder such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as it may reasonably request in order
to facilitate the disposition of Registrable Securities owned by Trustee, on
behalf of the Trust;
(d) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holder and do
such other acts or things which may be necessary or advisable to enable any
Holder to consummate the public sale or other disposition in such jurisdictions
of such securities;
(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting also shall enter into and perform its
obligations under the underwriting agreement;
(f) Notify the Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any event
as a result of which 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 light of the circumstances then existing;
and
(g) Furnish, at the written request of any Holder requesting
registration of Registrable Securities pursuant to this Section 2, on the date
that such Registrable Securities are delivered to the underwriters for sale in
connection with a registration pursuant to this Section 2, if such securities
are being sold through underwriters, on the date that the registration statement
with respect to such securities becomes effective, (i) an opinion, dated such
date, of the counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and to
the Holder requesting registration of Registrable Securities and (ii) a letter
dated such date, from the independent accountants of the Company, in form and
substance as is customarily given by independent accountants to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and to
the Holder requesting registration of Registrable Securities.
6
<PAGE>
2.5 Indemnification.
---------------
(a) The Company will indemnify the Holder, each of its officers,
directors, partners and legal counsel, and each person controlling (within the
meaning of the Securities Act or the Exchange Act) such Holder, participating in
any registration, qualification or compliance effected pursuant to this Section
2 with respect to Registrable Securities held by such Holder, and each
underwriter, if any, and each person who controls any underwriter, against all
claims, losses, damages and liabilities (or actions in respect thereof),
including any of the foregoing incurred in settlement of any litigation,
commenced or threatened, to which they may become subject under the Securities
Act, the Exchange Act, or other federal or state law, arising out of or based on
(i) any untrue statement (or alleged untrue statement) of a material fact
contained in any prospectus, offering circular or other similar document
(including any related registration statement, notification or the like)
incident to any such registration, qualification or compliance, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made, or (ii) any violation by
the Company of any federal, state or common law rule or regulation applicable to
the Company in connection with any such registration, qualification or
compliance, and will reimburse the Holder, each of its officers, directors,
partners and legal counsel, and each person controlling such Holder, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, as incurred,
provided, however, that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement or omission, made in reliance on and in
conformity with written information furnished to the Company in an instrument
duly executed by the Holder or underwriter and stated to be specifically for use
therein.
(b) The Holder(s) will, if Registrable Securities held by such
Holder are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify the Company, each of
its directors, officers, partners and legal counsel, and each underwriter, if
any, of the Company's securities covered by such a registration statement, and
each person who controls the Company or such underwriter (within the meaning of
the Securities Act or the Exchange Act), and each other holder, if any, each of
its officers, directors, partners and legal counsel and each person controlling
such holder (within the meaning of the Securities Act or the Exchange Act),
against all claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation commenced or threatened, to which they may become subject under the
Securities Act, the Exchange Act or other federal or state law, arising out of
or based on (i) any untrue statement (or alleged untrue statement) of a material
fact contained in any such registration statement, prospectus, offering circular
or other similar document (including any related registration statement,
notification or the like) incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in
7
<PAGE>
light of the circumstances under which they were made, (ii) any violation by the
Holder of any federal, state or common law rule or regulation applicable to the
Holder in connection with any such registration, qualification or compliance and
the Holder will reimburse the Company, underwriters, other such holders, and
their directors, officers, partners, and legal counsel and each person who
controls the Company, the underwriter or such other holders, for any legal or
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, as incurred, with
respect to Section 2.5(b)(i), in each case to the extent, but only to the
extent, that such untrue statement (or alleged untrue statement) or omission (or
alleged omission) is made in such registration statement, prospectus, offering
circular or other document in reliance upon and in conformity with written
information furnished to the Company in an instrument duly executed by Holder
and stated to be specifically for use therein.
(c) Each party entitled to indemnification under this Section 2.5
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has received written notice of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party to assume the defense of any such claim
or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld); provided, however, that if any Indemnified Party
------------------
shall have reasonably concluded that there may be one or more legal defenses
available to such Indemnified Party which are different from or additional to
those available to the Indemnifying Party, or that such claim or litigation
involves or could have an effect upon matters beyond the scope of the indemnity
agreement provided in this Section 2.5, the Indemnifying Party shall not have
the right to assume the defense of such action on behalf of such Indemnified
Party. As to an action in which the Indemnifying Party has assumed the defense,
the Indemnified Party may participate in such defense at such party's expense;
provided, however, that the Indemnifying Party shall bear the expense of such
- ------------------
defense of the Indemnified Party if representation of both parties by the same
counsel would be inappropriate due to actual or potential conflicts of interest.
The failure of any Indemnified Party to give notice as provided herein shall
relieve the Indemnifying Party of its obligations under this Section 2.5 only to
the extent that such failure to give notice shall materially adversely prejudice
the Indemnifying Party in the defense of any such claim or any litigation. No
Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party
of a release from all liability in respect to such claim or litigation.
(d) If the Indemnification provided for in this Section 2.5 is
unavailable to or insufficient to hold harmless an Indemnified Party under this
Section 2.5 in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to herein, then each Indemnifying Party shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in the same proportion as the net proceeds from the offering (before
8
<PAGE>
deducting expenses) received by such Indemnifying Party bear to the total net
proceeds from the offering (before deducting expenses) received by all
Indemnifying Parties (including the Company) selling shares in such offering.
No Indemnifying Party shall be required to contribute any amount in excess of
the amount by which the net proceeds from the offering (before deducting
expenses) received by it exceeds the amount of any damages which such
Indemnifying Party has otherwise been required to pay (in connection with the
untrue statement or omission, which occasioned the losses, claims, damages,
liabilities or actions) by reason of its indemnification obligations under this
Section 2.5. 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 is not guilty of such fraudulent
misrepresentation. The contribution obligations of each Indemnifying Party
under this Section 2.5 are several and not joint.
2.6 Information by Holder. The Holder or Holders of Registrable
---------------------
Securities included in any registration shall furnish to the Company such
information regarding such Holder or Holders and the distribution proposed by
such Holder or Holders as the Company may request in writing and as shall be
reasonably required in connection with any registration, qualification or
compliance referred to in this Section 2.
2.7 Rule 144 Reporting. With a view to making available the benefits of
------------------
certain rules and regulations of the Commission which may at any time permit the
sale of the Registrable Securities to the public without registration, the
Company agrees to:
(a) Use its best efforts to facilitate the sale of the
Registrable Securities to the public, without registration under the Securities
Act, pursuant to Rule 144 under the Securities Act.
(b) Use its best efforts to then file with the Commission in a
timely manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act;
(c) Furnish to each Holder forthwith upon request a written
statement by the Company as to its compliance with the reporting requirements of
said Rule 144 and of the Securities Act and the Exchange Act, a copy of the most
recent annual or quarterly report of the Company, and such of the reports and
documents so filed by the Company as a Purchaser may reasonably request in order
to avail itself of any rule or regulation of the Commission allowing a Holder to
sell any such securities without registration.
2.8 Form S-3. The Holder shall have the right to an unlimited number of
--------
registrations on Form S-3 under this Section 2.8 (requests shall be in writing
and shall state the number of shares of Registrable Securities to be Registered,
the number of Registrable Shares disposed of, if any, and the intended method of
disposition of such shares by such Holder or Holders); provided that the Company
shall not be obligated to file and cause to become effective more than two such
registrations during any 12-month period.
The Company shall give notice to all Holders of Registrable Securities of
the receipt of a request for registration pursuant to this Section
9
<PAGE>
2.8 and shall provide a reasonable opportunity for other Holders to participate
in the registration. Subject to the foregoing, the Company will use its best
efforts to effect promptly the registration of all shares of Registrable
Securities on Form S-3, as the case may be, to the extent requested in writing
by the Holder or Holders thereof.
2.9 Transfer of Registration Rights. The rights granted under this
-------------------------------
Section 2 may be assigned or otherwise transferred by the Holder only in
connection with the sale or transfer of Shares or Registrable Securities;
provided, however, that the Company is given 30 days prior written notice of the
- -------- -------
proposed transfer, the name and address of said transferee and said transferee's
agreement to be bound by the provisions of this Agreement. The transfer will be
effective upon delivery of the shares to the transferee and such transferee
execution of an amendment to this Agreement.
2.10 Certain Limitations in Connection with Future Grants of
-------------------------------------------------------
Registration Rights. From and after the date of this Agreement, the Company
- -------------------
shall not enter into any agreement with any holder or prospective holder of any
securities of the Company providing for the granting to such holder of
registration rights unless such agreement contains provisions substantially
similar to those contained in Sections 2.1(c) and 2.2(b) with respect to the
allocation of Registrable Securities to be included in an underwritten public
offering if marketing factors require a limitation on the number of such
securities to be included.
Notwithstanding the foregoing, from and after the date hereof the Company
shall not enter into any agreement with any Person or Persons providing for the
granting to such holder of registration rights which are or may be superior to
those granted to Holders pursuant to this Section 2, or of registration rights
which might cause a reduction in the number of shares includable by the Holders
in any offering pursuant to Section 2.1 or in any offering subject to Section
2.2.
3. Miscellaneous.
-------------
3.1 Governing Law. This Agreement shall be governed by and construed in
-------------
accordance with the laws of the State of New York applicable to contracts
between New York residents entered into and to be performed entirely within the
State of New York.
3.2 Successors and Assigns. Except as otherwise provided herein, the
----------------------
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
3.3 Entire Agreement. This Agreement constitutes the full and entire
----------------
understanding and agreement between the parties with regard to the subjects
hereof and thereof.
3.4 Notices, etc. All notices and other communications required or
------------
permitted hereunder shall be deemed delivered upon receipt and shall be in
writing and shall be mailed by first-class mail, postage prepaid, or
10
<PAGE>
otherwise delivered by hand or by messenger (including express courier such as
Federal Express), addressed (a) if to Trustee at the following address: U.S.
Trust Company, 770 Broadway, 10th Floor, New York, New York 10003, Attention:
Judith M. Prepanowski, or at such other address the Trustee shall have furnished
to the Company in writing, or (b) if to any other holder, at such address as
such holder shall have furnished the Company in writing, or, until any such
holder so furnishes an address to the Company, then to and at the address of the
last holder of such securities who has so furnished an address to the Company,
or (c) if to the Company, at the address set forth above (to the attention of
the General Counsel) or at such address as the Company shall have furnished to
the Trustee and each such other Holder by notice in writing.
3.5 Delays or Omissions. No delay or omission to exercise any right,
-------------------
power or remedy accruing to any party hereto, upon any breach or default of the
other party under this Agreement, shall impair any such right, power or remedy
of the non-defaulting party nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence therein, or of or in any similar breach or
default thereunder occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any party of any breach or default under this
Agreement, or any waiver on the part of any party of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in such writing. All remedies, under this
Agreement, at law or in equity afforded to any party, shall be cumulative and
not alternative.
3.6 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together, shall constitute one
instrument.
3.7 Severability. In case any provision of this Agreement shall be
------------
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
3.8 Amendments; Waivers. The provisions of this Agreement may be
-------------------
amended at any time and from time to time, with and only with an Agreement or
consent in writing signed by the Company on the one hand and the Trustee on the
other. Any amendment effected in accordance with this Section shall be binding
upon each signatory hereto and on any successors to the rights of such
signatories hereunder. In addition, (a) any right conferred herein upon the
holders of Registrable Securities as a class may be waived, generally or in any
particular instance, by the written agreement of the Holders of at least a
majority of the Registrable Securities (with any such waiver being binding on
each holder of Registrable Securities) and (b) any party may, without the
consent of any other party, waive any right(s) to which he or it would otherwise
be entitled, to the extent that such waiver is a waiver only of such party's
right(s).
11
<PAGE>
The foregoing DCP Trust Registration Rights Agreement is hereby duly
executed by the authorized representatives of the parties hereto as of the date
first above written.
NATIONAL MEDICAL ENTERPRISES, INC., a
Nevada corporation
By: _____________________________________
Scott M. Brown
Senior Vice President, Secretary and
General Counsel
UNITED STATES TRUST COMPANY OF NEW YORK, a
_________________ corporation
By: ______________________________________
Title: ___________________________________
12
<PAGE>
SERP TRUST REGISTRATION RIGHTS AGREEMENT
----------------------------------------
THIS SERP TRUST REGISTRATION RIGHTS AGREEMENT (the "Agreement"), dated as
of ________________ ___, 1994, is entered into by and between NATIONAL MEDICAL
ENTERPRISES, INC. (the "Company"), a Nevada corporation with offices at 2700
Colorado Avenue, Santa Monica, California 90404 and UNITED STATES TRUST COMPANY
OF NEW YORK, a New York corporation with offices at 114 West 47th Street, New
York, New York 10036 (the "Trustee"), as trustee U/A dated May __, 1994 for the
1994 NME Supplemental Executive Retirement Plan Trust ("the Trust").
RECITALS
A. The Company has adopted the NME Supplemental Executive Retirement Plan
(the "Plan").
B. The Company has established the Trust pursuant to that certain Trust
Agreement between the Company and the Trustee dated May ___, 1994 (the "Trust
Agreement") in order to secure the benefits payable to participants and their
beneficiaries in accordance with the Plan.
C. The Trustee has agreed to serve as trustee under the Trust.
D. Pursuant to the Trust Agreement, the Company has agreed to deposit with
the Trustee, as trustee of the Trust, one million shares of National Medical
Enterprises, Inc. Common Stock, $.075 par value per share (the "Common Stock").
E. The Company and the Trustee desire to set forth the registration rights
to be granted to the Trustee in connection with its holding of the Common Stock.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants, representations,
warranties and conditions set forth in this Agreement and the Trust Agreement
and other valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
1. Certain Definitions. The following terms are defined as follows:
-------------------
"Commission" shall mean the Securities and Exchange Commission or any other
------------
federal agency at the time administering the Securities Act.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, or
------------
any successor federal statute, and the rules and regulations of the Commission
issued under the Exchange Act, as they each may, from time to time, be in
effect.
"Holder" shall mean the Trustee and any successor trustee or co-trustee
--------
appointed in accordance with the terms of the Trust Agreement.
1
<PAGE>
"Person" shall mean any natural person, partnership, corporation,
--------
association or other legal entity.
"Registration Expenses" shall mean all expenses incurred by the Company in
-----------------------
complying with Sections 2.1, 2.2 and 2.8 hereof, including, without limitation,
all registration and filing fees, printing expenses, registrar and transfer
agent fees, exchange listing fees, photocopy and courier fees, fees and
disbursements of counsel for the Company, reasonable fees and disbursements of
special counsel for the Holder, Blue Sky fees and expenses, and the expense for
any special audits incident to or required by any such registration (but
excluding the compensation of regular employees of the Company, which shall be
paid in any event by the Company).
"Registrable Securities" shall mean the Shares and/or shares of Common
------------------------
Stock issued as a dividend or other distribution with respect to, or in exchange
or in replacement of, the Shares.
"Register", "Registered" and "Registration" shall refer to a registration
---------- ------------ --------------
effected by preparing and filing a Registration Statement in compliance with the
Securities Act, and the declaration or ordering of the effectiveness of such
registration statement.
"Registration Statement" means a registration statement filed by the
------------------------
Company with the Commission for a public offering and sale of securities of the
Company (other than a registration statement on Form S-4 or Form S-8, or their
successors, or any other form for a limited purpose, or any registration
statement covering only securities proposed to be issued in exchange for
securities or assets of another corporation).
"Rule 144" shall mean Rule 144 promulgated under the Securities Act.
----------
"Securities Act" shall mean the Securities Act of 1933, as amended, or any
----------------
successor federal statute, and the rules and regulations of the Commission
issued under the Securities Act, as they each may, from time to time, be in
effect.
"Selling Expenses" shall mean all underwriting discounts and selling
------------------
commissions applicable to the sale.
"Shares" shall mean the one million shares of Common Stock deposited with
--------
the Trustee pursuant to the Trust Agreement.
2. Trustee Registration Rights.
---------------------------
2.1 Trustee Requested Registration. In the event the Company shall
------------------------------
receive from the Holder a written request that the Company effect a registration
under the Securities Act (other than a registration on Form S-3, which is
provided for in Section 2.8 hereof, or any related form of Registration
Statement) with respect to at least 30% of the Registrable Securities (or any
lesser percentage if the aggregate offering price to the public would be at
least $2,000,000):
2
<PAGE>
(a) The Company will promptly give written notice of the proposed
registration to any other Holder, if there are co-trustees of the Trust who (i)
have been appointed co-trustees in accordance with the Trust Agreement and (ii),
through an amendment to this Agreement, have become parties to this Agreement;
and
(b) The Company will as soon as practicable, use its diligent best
efforts to effect such registration (including, without limitation, the
execution of an undertaking to file post-effective amendments, appropriate
qualification under applicable Blue Sky or other state securities laws and
appropriate compliance with applicable regulations issued under the Securities
Act) as may be so requested and as would permit or facilitate the sale and
distribution of such Registrable Securities as are specified in such request,
together with such Registrable Securities of any other Holder joining in such
request as specified in a written request received by the Company within 20 days
after receipt, by such Holder, of the Section 2.1(d) written notice from the
Company; provided that the Company shall not be obligated to take any action to
effect any registration, qualification or compliance pursuant to this Section
2.1 if the Company gives notice within 30 days of the registration request that
it is engaged, or has fixed plans to engage within 30 days of the time of the
request, in a firmly underwritten registered public offering. Subject to the
foregoing paragraph and to Section 2.1(d), the Company shall file a registration
statement covering the Registrable Securities so requested to be registered as
soon as practicable after receipt of the request of the Holder initiating the
registration request hereunder (the "Initiating Holder"). Absent the written
consent of a majority in interest of the Initiating Holders, the Company shall
not include in any registration under this Section 2.1 any shares of Common
Stock other than those specified by the Holder pursuant to the foregoing
provisions.
(c) If the Initiating Holder intends to distribute the Registrable
Securities covered by its request by means of an underwriting, it shall so
advise the Company as a part of its request made pursuant to Section 2.1 and the
Company shall include such information in the written notice referred to in
Section 2.1(a). The right of any Holder to registration pursuant to Section 2.1
shall be conditioned upon such Holder's participation in such underwriting. The
Company and the Holder shall enter into an underwriting agreement, in customary
form, with the underwriter or underwriters selected for such underwriting by the
Initiating Holder. Notwithstanding any other provision of this Section 2.1, if
the underwriter determines that marketing factors require a limitation of the
number of shares to be underwritten and so advises the Company in writing, then
the Company shall so advise all Holders participating in the registration and
underwriting. If the amount of shares proposed to be registered remains in
excess of the number satisfactory to the underwriter, the number of shares of
Registrable Securities included in the registration shall be further reduced to
a number satisfactory to the underwriter. In such event, the number of shares of
Registrable Securities that may be included in the registration and underwriting
shall be allocated among all Holders in proportion, as nearly as practicable, to
the respective amounts of Registrable Securities owned by such Holders at the
time of filing the registration statement. No Registrable Securities excluded
from the underwriting by reason of the underwriter's marketing limitation shall
be included in such registration. If any Holder disapproves of the terms of the
underwriting, such Person may elect
3
<PAGE>
to withdraw therefrom by written notice to the Company, the underwriter and the
Initiating Holder. The Registrable Securities and/or other securities so
withdrawn from such underwriting also shall be withdrawn from the registration;
provided, however, that, if by the withdrawal of such Registrable Securities a
- -------- -------
greater number of Registrable Securities held by other Holders may be included
in such registration (up to the maximum of any limitation imposed by the
underwriters), then the Company shall offer to all Holders who have included
Registrable Securities in the registration the right to include additional
Registrable Securities in the same proportion used above in determining the
underwriter limitation.
(d) If the Company shall furnish to the Initiating Holder a
certificate signed by the Chief Executive Officer of the Company stating that,
in the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed on or before the date filing would be required and it is
therefore essential to defer the filing of such registration statement, then the
Company may direct that such request for registration be delayed for a period
not in excess of 60 days, such right to delay a request to be exercised by the
Company not more than once in any 12-month period.
2.2 Company Registration.
--------------------
(a) If at any time or from time to time, the Company shall
determine to register any of its Common Stock, for its own account or for the
account of others (other than the Holder) pursuant to a Registration Statement,
other than a registration on any registration form which does not include
substantially the same information (other than information relating to the
selling stockholders or their plan of distribution) as would be required to be
included in a registration statement covering the sale of Registrable
Securities, the Company will:
(i) promptly give to the Holder written notice thereof (which
shall include a list of the jurisdictions in which the Company intends to
attempt to qualify such securities under the applicable Blue Sky or other state
securities laws); and
(ii) include in such registration (and any related
qualification under Blue Sky laws or other compliance), and in any underwriting
involved therein, all the Registrable Securities specified in a written request
by the Holder received by the Company within 20 days after the Holder received
the Section 2.2(a)(i) written notice from the Company.
(b) If the registration of which the Company gives notice is for a
registered public offering involving an underwriting, the Company shall so
advise the Holder as a part of the written notice given pursuant to Section
2.2(a)(i). In such event, the right of any Holder to registration pursuant to
Section 2.2 shall be conditioned upon such Holder's participation in such
underwriting and the inclusion of such Holder's Registrable Securities in the
underwriting to the extent provided herein. All Holders proposing to distribute
their securities through such underwriting shall (together with the Company and
the other holders distributing their securities through such
4
<PAGE>
underwriting) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by the Company. If
the underwriter determines that marketing factors require a limitation of the
number of shares to be underwritten, the underwriter may exclude certain of the
Registrable Securities from such registration and underwriting, as follows. The
Company shall so advise all Holders (except those Holders who have indicated to
the Company their decision not to distribute any of their Registrable Securities
through such underwriting) of such fact and of the number of shares of
Registrable Securities that may be included in the registration and
underwriting. The number of shares of Registrable Securities that may be
included in the registration and underwriting shall be allocated among such
Holders in proportion, as nearly as practicable, to the respective amounts of
Registrable Securities owned by them at the time of filing the registration
statement. Notwithstanding the foregoing, no exclusion of Registrable
Securities hereunder shall result in the Holders being unable to register, in
the aggregate, less than the lesser of (x) the aggregate number of Registrable
Securities sought to be registered by the Holders hereunder or (y) 25% of the
total number of shares registered in such registration. No Registrable
Securities excluded from the underwriting by reason of the underwriter's
marketing limitation shall be included in such registration. If any Holder
disapproves of the terms of any such underwriting, such person may elect to
withdraw therefrom by written notice to the Company and the underwriter. The
Registrable Securities and/or other securities so withdrawn from such
underwriting shall also be withdrawn from such registration; provided, however,
-------- -------
that, if by the withdrawal of such Registrable Securities a greater number of
Registrable Securities held by other Holders may be included in such
registration (up to the maximum of any limitation imposed by the underwriters),
then the Company shall offer to all holders who have included Registrable
Securities in the registration the right to include additional Registrable
Securities in the same proportion used above in determining the underwriter
limitation.
2.3 Expenses of Registration. All Registration Expenses incurred in
------------------------
connection with any registration, qualification or compliance pursuant to
Section 2.1, 2.2 or 2.8 shall be borne by the Company and all Selling Expenses
shall be borne by the holders of the securities so registered pro rata on the
basis of the number of shares so registered.
2.4 Registration Procedures. In the case of each registration,
-----------------------
qualification or compliance effected by the Company pursuant to this Section 2,
the Company will keep each Holder advised in writing as to the initiation of
each registration, qualification and compliance and as to the completion
thereof. At its expense the Company will:
(a) Keep such registration, qualification or compliance effective
for a period of 180 days or until the Holder has completed the distribution
described in the registration statement relating thereto, whichever first
occurs;
(b) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the
5
<PAGE>
provisions of the Securities Act with respect to the disposition of all
securities covered by such registration statement;
(c) Furnish to the Holder such numbers of copies of a prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as it may reasonably request in order
to facilitate the disposition of Registrable Securities owned by Trustee, on
behalf of the Trust;
(d) Use its best efforts to register and qualify the securities
covered by such registration statement under such other securities or Blue Sky
laws of such jurisdictions as shall be reasonably requested by the Holder and do
such other acts or things which may be necessary or advisable to enable any
Holder to consummate the public sale or other disposition in such jurisdictions
of such securities;
(e) In the event of any underwritten public offering, enter into
and perform its obligations under an underwriting agreement, in usual and
customary form, with the managing underwriter of such offering. Each Holder
participating in such underwriting also shall enter into and perform its
obligations under the underwriting agreement;
(f) Notify the Holder of Registrable Securities covered by such
registration statement, at any time when a prospectus relating thereto is
required to be delivered under the Securities Act, of the happening of any event
as a result of which 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 light of the circumstances then existing;
and
(g) Furnish, at the written request of any Holder requesting
registration of Registrable Securities pursuant to this Section 2, on the date
that such Registrable Securities are delivered to the underwriters for sale in
connection with a registration pursuant to this Section 2, if such securities
are being sold through underwriters, on the date that the registration statement
with respect to such securities becomes effective, (i) an opinion, dated such
date, of the counsel representing the Company for the purposes of such
registration, in form and substance as is customarily given to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and to
the Holder requesting registration of Registrable Securities and (ii) a letter
dated such date, from the independent accountants of the Company, in form and
substance as is customarily given by independent accountants to underwriters in
an underwritten public offering, addressed to the underwriters, if any, and to
the Holder requesting registration of Registrable Securities.
6
<PAGE>
2.5 Indemnification.
---------------
(a) The Company will indemnify the Holder, each of its officers,
directors, partners and legal counsel, and each person controlling (within the
meaning of the Securities Act or the Exchange Act) such Holder, participating in
any registration, qualification or compliance effected pursuant to this Section
2 with respect to Registrable Securities held by such Holder, and each
underwriter, if any, and each person who controls any underwriter, against all
claims, losses, damages and liabilities (or actions in respect thereof),
including any of the foregoing incurred in settlement of any litigation,
commenced or threatened, to which they may become subject under the Securities
Act, the Exchange Act, or other federal or state law, arising out of or based on
(i) any untrue statement (or alleged untrue statement) of a material fact
contained in any prospectus, offering circular or other similar document
(including any related registration statement, notification or the like)
incident to any such registration, qualification or compliance, or based on any
omission (or alleged omission) to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading in the
light of the circumstances under which they were made, or (ii) any violation by
the Company of any federal, state or common law rule or regulation applicable to
the Company in connection with any such registration, qualification or
compliance, and will reimburse the Holder, each of its officers, directors,
partners and legal counsel, and each person controlling such Holder, each such
underwriter and each person who controls any such underwriter, for any legal and
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, as incurred,
provided, however, that the Company will not be liable in any such case to the
extent that any such claim, loss, damage, liability or expense arises out of or
is based on any untrue statement or omission, made in reliance on and in
conformity with written information furnished to the Company in an instrument
duly executed by the Holder or underwriter and stated to be specifically for use
therein.
(b) The Holder(s) will, if Registrable Securities held by such
Holder are included in the securities as to which such registration,
qualification or compliance is being effected, indemnify the Company, each of
its directors, officers, partners and legal counsel, and each underwriter, if
any, of the Company's securities covered by such a registration statement, and
each person who controls the Company or such underwriter (within the meaning of
the Securities Act or the Exchange Act), and each other holder, if any, each of
its officers, directors, partners and legal counsel and each person controlling
such holder (within the meaning of the Securities Act or the Exchange Act),
against all claims, losses, damages and liabilities (or actions in respect
thereof), including any of the foregoing incurred in settlement of any
litigation commenced or threatened, to which they may become subject under the
Securities Act, the Exchange Act or other federal or state law, arising out of
or based on (i) any untrue statement (or alleged untrue statement) of a material
fact contained in any such registration statement, prospectus, offering circular
or other similar document (including any related registration statement,
notification or the like) incident to any such registration, qualification or
compliance, or based on any omission (or alleged omission) to state therein a
material fact required to be stated therein or necessary to make the statements
therein not misleading in
7
<PAGE>
light of the circumstances under which they were made, (ii) any violation by the
Holder of any federal, state or common law rule or regulation applicable to the
Holder in connection with any such registration, qualification or compliance and
the Holder will reimburse the Company, underwriters, other such holders, and
their directors, officers, partners, and legal counsel and each person who
controls the Company, the underwriter or such other holders, for any legal or
any other expenses reasonably incurred in connection with investigating or
defending any such claim, loss, damage, liability or action, as incurred, with
respect to Section 2.5(b)(i), in each case to the extent, but only to the
extent, that such untrue statement (or alleged untrue statement) or omission (or
alleged omission) is made in such registration statement, prospectus, offering
circular or other document in reliance upon and in conformity with written
information furnished to the Company in an instrument duly executed by Holder
and stated to be specifically for use therein.
(c) Each party entitled to indemnification under this Section 2.5
(the "Indemnified Party") shall give notice to the party required to provide
indemnification (the "Indemnifying Party") promptly after such Indemnified Party
has received written notice of any claim as to which indemnity may be sought,
and shall permit the Indemnifying Party to assume the defense of any such claim
or any litigation resulting therefrom, provided that counsel for the
Indemnifying Party, who shall conduct the defense of such claim or litigation,
shall be approved by the Indemnified Party (whose approval shall not
unreasonably be withheld); provided, however, that if any Indemnified Party
-------- -------
shall have reasonably concluded that there may be one or more legal defenses
available to such Indemnified Party which are different from or additional to
those available to the Indemnifying Party, or that such claim or litigation
involves or could have an effect upon matters beyond the scope of the indemnity
agreement provided in this Section 2.5, the Indemnifying Party shall not have
the right to assume the defense of such action on behalf of such Indemnified
Party. As to an action in which the Indemnifying Party has assumed the defense,
the Indemnified Party may participate in such defense at such party's expense;
provided, however, that the Indemnifying Party shall bear the expense of such
- -------- -------
defense of the Indemnified Party if representation of both parties by the same
counsel would be inappropriate due to actual or potential conflicts of interest.
The failure of any Indemnified Party to give notice as provided herein shall
relieve the Indemnifying Party of its obligations under this Section 2.5 only to
the extent that such failure to give notice shall materially adversely prejudice
the Indemnifying Party in the defense of any such claim or any litigation. No
Indemnifying Party, in the defense of any such claim or litigation, shall,
except with the consent of each Indemnified Party, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional
term thereof the giving by the claimant or plaintiff to such Indemnified Party
of a release from all liability in respect to such claim or litigation.
(d) If the Indemnification provided for in this Section 2.5 is
unavailable to or insufficient to hold harmless an Indemnified Party under this
Section 2.5 in respect of any losses, claims, damages or liabilities (or actions
in respect thereof) referred to herein, then each Indemnifying Party shall
contribute to the amount paid or payable by such Indemnified Party as a result
of such losses, claims, damages or liabilities (or actions in respect thereof)
in the same proportion as the net proceeds from the offering (before
8
<PAGE>
deducting expenses) received by such Indemnifying Party bear to the total net
proceeds from the offering (before deducting expenses) received by all
Indemnifying Parties (including the Company) selling shares in such offering.
No Indemnifying Party shall be required to contribute any amount in excess of
the amount by which the net proceeds from the offering (before deducting
expenses) received by it exceeds the amount of any damages which such
Indemnifying Party has otherwise been required to pay (in connection with the
untrue statement or omission, which occasioned the losses, claims, damages,
liabilities or actions) by reason of its indemnification obligations under this
Section 2.5. 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 is not guilty of such fraudulent
misrepresentation. The contribution obligations of each Indemnifying Party
under this Section 2.5 are several and not joint.
2.6 Information by Holder. The Holder or Holders of Registrable
---------------------
Securities included in any registration shall furnish to the Company such
information regarding such Holder or Holders and the distribution proposed by
such Holder or Holders as the Company may request in writing and as shall be
reasonably required in connection with any registration, qualification or
compliance referred to in this Section 2.
2.7 Rule 144 Reporting. With a view to making available the benefits
------------------
of certain rules and regulations of the Commission which may at any time permit
the sale of the Registrable Securities to the public without registration, the
Company agrees to:
(a) Use its best efforts to facilitate the sale of the Registrable
Securities to the public, without registration under the Securities Act,
pursuant to Rule 144 under the Securities Act.
(b) Use its best efforts to then file with the Commission in a
timely manner all reports and other documents required of the Company under the
Securities Act and the Exchange Act;
(c) Furnish to each Holder forthwith upon request a written
statement by the Company as to its compliance with the reporting requirements of
said Rule 144 and of the Securities Act and the Exchange Act, a copy of the most
recent annual or quarterly report of the Company, and such of the reports and
documents so filed by the Company as a Purchaser may reasonably request in order
to avail itself of any rule or regulation of the Commission allowing a Holder to
sell any such securities without registration.
2.8 Form S-3. The Holder shall have the right to an unlimited number
--------
of registrations on Form S-3 under this Section 2.8 (requests shall be in
writing and shall state the number of shares of Registrable Securities to be
Registered, the number of Registrable Shares disposed of, if any, and the
intended method of disposition of such shares by such Holder or Holders);
provided that the Company shall not be obligated to file and cause to become
effective more than two such registrations during any 12-month period.
The Company shall give notice to all Holders of Registrable Securities of
the receipt of a request for registration pursuant to this Section
9
<PAGE>
2.8 and shall provide a reasonable opportunity for other Holders to participate
in the registration. Subject to the foregoing, the Company will use its best
efforts to effect promptly the registration of all shares of Registrable
Securities on Form S-3, as the case may be, to the extent requested in writing
by the Holder or Holders thereof.
2.9 Transfer of Registration Rights. The rights granted under this
-------------------------------
Section 2 may be assigned or otherwise transferred by the Holder only in
connection with the sale or transfer of Shares or Registrable Securities;
provided, however, that the Company is given 30 days prior written notice of the
- -------- -------
proposed transfer, the name and address of said transferee and said transferee's
agreement to be bound by the provisions of this Agreement. The transfer will be
effective upon delivery of the shares to the transferee and such transferee
execution of an amendment to this Agreement.
2.10 Certain Limitations in Connection with Future Grants of
-------------------------------------------------------
Registration Rights. From and after the date of this Agreement, the Company
- -------------------
shall not enter into any agreement with any holder or prospective holder of any
securities of the Company providing for the granting to such holder of
registration rights unless such agreement contains provisions substantially
similar to those contained in Sections 2.1(c) and 2.2(b) with respect to the
allocation of Registrable Securities to be included in an underwritten public
offering if marketing factors require a limitation on the number of such
securities to be included.
Notwithstanding the foregoing, from and after the date hereof the Company
shall not enter into any agreement with any Person or Persons providing for the
granting to such holder of registration rights which are or may be superior to
those granted to Holders pursuant to this Section 2, or of registration rights
which might cause a reduction in the number of shares includable by the Holders
in any offering pursuant to Section 2.1 or in any offering subject to Section
2.2.
3. Miscellaneous.
-------------
3.1 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the laws of the State of New York applicable to contracts
between New York residents entered into and to be performed entirely within the
State of New York.
3.2 Successors and Assigns. Except as otherwise provided herein, the
----------------------
provisions hereof shall inure to the benefit of, and be binding upon, the
successors, assigns, heirs, executors and administrators of the parties hereto.
3.3 Entire Agreement. This Agreement constitutes the full and entire
----------------
understanding and agreement between the parties with regard to the subjects
hereof and thereof.
3.4 Notices, etc. All notices and other communications required or
------------
permitted hereunder shall be deemed delivered upon receipt and shall be in
writing and shall be mailed by first-class mail, postage prepaid, or
10
<PAGE>
otherwise delivered by hand or by messenger (including express courier such as
Federal Express), addressed (a) if to Trustee at the following address: U.S.
Trust Company, 770 Broadway, 10th Floor, New York, New York 10003, Attention:
Judith M. Prepanowski, or at such other address the Trustee shall have furnished
to the Company in writing, or (b) if to any other holder, at such address as
such holder shall have furnished the Company in writing, or, until any such
holder so furnishes an address to the Company, then to and at the address of the
last holder of such securities who has so furnished an address to the Company,
or (c) if to the Company, at the address set forth above (to the attention of
the General Counsel) or at such address as the Company shall have furnished to
the Trustee and each such other Holder by notice in writing.
3.5 Delays or Omissions. No delay or omission to exercise any right,
-------------------
power or remedy accruing to any party hereto, upon any breach or default of the
other party under this Agreement, shall impair any such right, power or remedy
of the non-defaulting party nor shall it be construed to be a waiver of any such
breach or default, or an acquiescence therein, or of or in any similar breach or
default thereunder occurring; nor shall any waiver of any single breach or
default be deemed a waiver of any other breach or default theretofore or
thereafter occurring. Any waiver, permit, consent or approval of any kind or
character on the part of any party of any breach or default under this
Agreement, or any waiver on the part of any party of any provisions or
conditions of this Agreement, must be in writing and shall be effective only to
the extent specifically set forth in such writing. All remedies, under this
Agreement, at law or in equity afforded to any party, shall be cumulative and
not alternative.
3.6 Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be enforceable against the parties actually
executing such counterparts, and all of which together, shall constitute one
instrument.
3.7 Severability. In case any provision of this Agreement shall be
------------
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.
3.8 Amendments; Waivers. The provisions of this Agreement may be
-------------------
amended at any time and from time to time, with and only with an Agreement or
consent in writing signed by the Company on the one hand and the Trustee on the
other. Any amendment effected in accordance with this Section shall be binding
upon each signatory hereto and on any successors to the rights of such
signatories hereunder. In addition, (a) any right conferred herein upon the
holders of Registrable Securities as a class may be waived, generally or in any
particular instance, by the written agreement of the Holders of at least a
majority of the Registrable Securities (with any such waiver being binding on
each holder of Registrable Securities) and (b) any party may, without the
consent of any other party, waive any right(s) to which he or it would otherwise
be entitled, to the extent that such waiver is a waiver only of such party's
right(s).
11
<PAGE>
The foregoing SERP Trust Registration Rights Agreement is hereby duly
executed by the authorized representatives of the parties hereto as of the date
first above written.
NATIONAL MEDICAL ENTERPRISES, INC., a
Nevada corporation
By: ______________________________________
Scott M. Brown
Senior Vice President, Secretary and
General Counsel
UNITED STATES TRUST COMPANY OF NEW YORK, a
_________________ corporation
By: ______________________________________
Title: ___________________________________
12
<PAGE>
August 26, 1994
National Medical Enterprises, Inc.
2700 Colorado Avenue
Santa Monica, California 90404
Ladies and Gentlemen:
I am the General Counsel of National Medical Enterprises, Inc. (the
"Company"), and in such capacity I have examined the Registration Statement on
Form S-3 (the "Registration Statement") to be filed by the Company with the
Securities and Exchange Commission in connection with the registration under the
Securities Act of 1933, as amended, of shares of Common Stock of the Company.
In rendering this opinion, I have examined the Company's Restated
Articles of Incorporation, Restated By-Laws, 1994 NME Deferred Compensation Plan
Trust, as amended ("DCP Trust"), 1994 NME Supplemental Executive Retirement Plan
Trust, as amended ("SERP Trust"), DCP Trust Registration Rights Agreement, SERP
Trust Registration Rights Agreement, all resolutions adopted by the Company's
Board of Directors pertaining to the Trusts and such other documents and
corporate records as I have deemed necessary or appropriate for the purposes of
this opinion.
Based on the foregoing, it is my opinion that the shares of Common
Stock to which the Registration Statement and Prospectus relate have been duly
authorized, validly issued, fully paid and non-assessable.
I hereby consent to your filing of this opinion as an exhibit to the
Registration Statement and to the reference to me in the Prospectus incorporated
therein.
Very truly yours,
/s/ SCOTT M. BROWN
Scott M. Brown
SMB/jbb
<PAGE>
The Board of Directors
National Medical Enterprises, Inc.:
We consent to the use of our reports incorporated herein by reference and to the
reference to our firm under the heading "Experts" in the prospectus.
/s/ KPMG PEAT MARWICK LLP
Los Angeles, California
August 23, 1994
