-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, JA6eaTsnjZb8vZDxO/Ufwz0/gw+Lam8z9szRk+nFgYpTo4wuUq1eiLGONMrugShV heGNDI7sEp1PbiuycN9mEA== 0000909518-01-000069.txt : 20010129 0000909518-01-000069.hdr.sgml : 20010129 ACCESSION NUMBER: 0000909518-01-000069 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 9 FILED AS OF DATE: 20010125 GROUP MEMBERS: ADVISORS GENPAR, INC. GROUP MEMBERS: HUDSON ADVISORS ASSOCIATES, L.P. GROUP MEMBERS: HUDSON ADVISORS, L.L.C. GROUP MEMBERS: JOHN P. GRAYKEN GROUP MEMBERS: LONE STAR MANAGEMENT CO., LTD. GROUP MEMBERS: LONE STAR OPPORTUNITY FUND, L.P. GROUP MEMBERS: LONE STAR PARTNER, L.P. GROUP MEMBERS: LSOF GENPAR, INC. GROUP MEMBERS: LSOF POOLED EQUITY LP GROUP MEMBERS: TERLINGUA ADVISORS, INC. SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: GREENBRIAR CORP CENTRAL INDEX KEY: 0000105744 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-SKILLED NURSING CARE FACILITIES [8051] IRS NUMBER: 752399477 STATE OF INCORPORATION: NV FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: SEC FILE NUMBER: 005-38763 FILM NUMBER: 1514876 BUSINESS ADDRESS: STREET 1: 4265 KELLWAY CIRCLE CITY: ADDISON STATE: TX ZIP: 75244 BUSINESS PHONE: 2144078400 MAIL ADDRESS: STREET 1: 4265 KELLWAY CIRCLE CITY: ADDISON STATE: TX ZIP: 75244 FORMER COMPANY: FORMER CONFORMED NAME: MEDICAL RESOURCE COMPANIES OF AMERICA DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: WESPAC INVESTORS TRUST DATE OF NAME CHANGE: 19900605 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: LSOF POOLED EQUITY LP CENTRAL INDEX KEY: 0001110506 STANDARD INDUSTRIAL CLASSIFICATION: [] FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 600 NORTH PEARL STREET, SUITE1500 CITY: DALLAS STATE: TX ZIP: 75201 BUSINESS PHONE: 2147548400 SC 13D/A 1 0001.txt ================================================================================ SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------------------- SCHEDULE 13D (Rule 13d-101) INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a) (Amendment No. 5)1 GREENBRIAR CORPORATION ----------------------------------------------------------------------------- (Name of Issuer) Common Stock, par value $0.01 per share ----------------------------------------------------------------------------- (Title of Class of Securities) 393648-10-0 ---------------------------------------------------------------------------- (CUSIP Number) J.D. Dell Lone Star Opportunity Fund, L.P. 600 North Pearl Street, Suite 1550 Dallas, Texas 75201 (214) 754-8300 ----------------------------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) January 25, 2001 ----------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g), check the following box [ ]. NOTE: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7(b) for other parties to whom copies are to be sent. (Continued on following pages) (Page 1 of 27 Pages) - -------------- 1 The remainder of this cover page shall be filled out for a reporting person's initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).
- ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 2 of 27 Pages - ------------------------------------------------------------------------------- =========================================================================== 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) LSOF POOLED EQUITY, L.P. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* OO - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,502,855 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,502,855 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,502,855 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 3 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) TERLINGUA ADVISORS, INC. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* WC - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 2,200 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 2,200 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 0.03% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 4 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) LSOF GENPAR, INC. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,502,855 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,502,855 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,502,855 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 5 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) LONE STAR OPPORTUNITY FUND, L.P. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,502,855 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,502,855 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,502,855 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 6 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) LONE STAR PARTNER, L.P. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,502,855 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,502,855 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,502,855 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 7 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) LONE STAR MANAGEMENT CO., LTD. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION DELAWARE - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,502,855 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,502,855 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,502,855 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 8 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) HUDSON ADVISORS, L.L.C. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION TEXAS - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,505,055 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,505,055 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,505,055* - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* OO ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 9 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) HUDSON ADVISORS ASSOCIATES, L.P. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION TEXAS - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,505,055 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,505,055 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,505,055* - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* PN ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 10 of 27 Pages - ------------------------------------------------------------------------------- ============================================================================= 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) ADVISORS GENPAR, INC. - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION TEXAS - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,505,055 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,505,055 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,505,055* - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* CO ============================================================================= *SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 11 of 27 Pages - ------------------------------------------------------------------------------- =========================================================================== 1 NAMES OF REPORTING PERSON I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) JOHN P. GRAYKEN - ----------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP* (a) [ ] (b) [ ] - ----------------------------------------------------------------------------- 3 SEC USE ONLY - ----------------------------------------------------------------------------- 4 SOURCE OF FUNDS* AF - ----------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(d) or 2(e) [ ] - ----------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION IRELAND - ----------------------------------------------------------------------------- NUMBER OF 7 SOLE VOTING POWER SHARES 27,505,055 BENEFICIALLY OWNED BY EACH REPORTING PERSON WITH - ----------------------------------------------------------------------------- 8 SHARED VOTING POWER - ----------------------------------------------------------------------------- 9 SOLE DISPOSITIVE POWER 27,505,055 - ----------------------------------------------------------------------------- 10 SHARED DISPOSITIVE POWER - ----------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 27,505,055 - ----------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* [ ] - ----------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 79.7% - ----------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON* IN =============================================================================
*SEE INSTRUCTIONS BEFORE FILLING OUT! - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 12 of 27 Pages - ------------------------------------------------------------------------------- ITEM 1. SECURITY AND ISSUER. This statement relates to the common stock, $0.01 par value per share (the "Common Stock"), of Greenbriar Corporation, a Nevada corporation ("Greenbriar"). The address of the principal executive offices of Greenbriar is 4265 Kellway Circle, Addison, Texas 75244. ITEM 2. IDENTITY AND BACKGROUND. This statement is filed on behalf of LSOF Pooled Equity, L.P., a Delaware limited partnership ("Pooled Equity"). The general partner of Pooled Equity is LSOF GenPar, Inc., a Delaware corporation ("GenPar"). The sole stockholder of GenPar is Lone Star Opportunity Fund, L.P., a Delaware limited partnership ("Lone Star"). The general partner of Lone Star is Lone Star Partner, L.P., a Delaware limited partnership ("Partner"). The general partner of Partner is Lone Star Management Co., Ltd., a Delaware corporation ("Management"). Hudson Advisors, L.L.C., a Texas limited liability company ("Hudson"), is the asset manager of the securities of Greenbriar owned by Pooled Equity, pursuant to an Asset Management Agreement. Hudson is the sole stockholder of Terlingua Advisors, Inc., a Delaware corporation ("Terlingua"). Hudson Advisors Associates, L.P., a Texas limited partnership ("Associates"), is the majority owner of the membership interests of Hudson. Advisors GenPar, Inc., a Texas corporation ("Advisors"), is the general partner of Associates. John P. Grayken ("Grayken"), a citizen of Ireland, is the sole stockholder, sole director and President of Management and the sole stockholder and sole director of Advisors. However, Grayken disclaims beneficial ownership in the Common Stock to which this statement relates. GenPar, Lone Star, Partner, Management, Hudson, Associates, Advisors and Grayken are herein referred to as "Control Persons." The address of the principal offices and business address of Pooled Equity, Lone Star, Partner and Management is 600 North Pearl Street, Suite 1550, Dallas, Texas 75201. The address of the principal offices and business address of Hudson, Terlingua, Associates and Advisors is 600 North Pearl Street, Suite 1500, Dallas, Texas 75201. The business address of Grayken, is 50 Welbeck Street, London, United Kingdom, W1M7HE. Pooled Equity, GenPar, Lone Star, Partner, Management, Terlingua, Hudson, Associates and Advisors are all part of a private investment partnership investing in a broad range of primarily real estate related investments. Lone Star's investors are primarily pension funds and other institutional investors. Grayken's principal occupation is serving in the aforementioned offices of Management. None of Pooled Equity, GenPar, Lone Star, Partner, Management, Terlingua, Hudson, Associates, Advisors or Grayken has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations and similar misdemeanors). None of Pooled Equity, GenPar, Lone Star, Partner, Management, Terlingua, Hudson, Associates, Advisors or Grayken has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 13 of 27 Pages - ------------------------------------------------------------------------------- Other Information - ----------------- Attached as Schedule I hereto is a list of the directors and executive officers of GenPar, Management, Hudson, Advisors and Terlingua which contains the following information with respect to each person: (i) name; (ii) principal business address; and (iii) present principal occupation or employment. None of the entities or persons identified on Schedule I hereto has, during the last five years, been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors). None of the entities or persons identified on Schedule I hereto has, during the last five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws. Each person identified on Schedule I hereto is a United States citizen, other than Grayken, who is a citizen of Ireland. ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION. On January 13, 1998, Lone Star purchased (i) 1,400,000 shares of Greenbriar's Series F Senior Convertible Preferred Stock (the "Series F Preferred"), $0.10 par value per share, at a purchase price of $10.00 per share and (ii) 800,000 shares of Greenbriar's Series G Senior Non-Voting Convertible Preferred Stock $0.10 par value per share (the "Series G Preferred"), at a purchase price of $10.00 per share. The Series F Preferred and Series G Preferred (collectively, the "Preferred Stock") were convertible, subject to the terms of the Preferred Stock, into shares of Common Stock, based on a conversion price of $17.50 per share of Common Stock. The aggregate purchase price for the Preferred Stock was $22,000,000 and was funded by capital contributions from Lone Star's partners. Lone Star assigned the Preferred Stock to LSOF Greenbriar, L.L.C., a Delaware limited liability and wholly owned subsidiary of Lone Star ("LSOF Greenbriar") pursuant to an Assignment and Assumption Agreement dated January 13, 1998. On July 23, 1998, LSOF Greenbriar assigned the Preferred Stock to Pooled Equity. The terms of the Preferred Stock are set forth in (i) the Stock Purchase Agreement dated as of December 31, 1997 between Greenbriar and Lone Star filed as Exhibit 1 hereto (the "Stock Purchase Agreement"), (ii) the Certificate of Voting Powers, Designations, Preferences and Relative, Participating, Optional or other Special Rights of Series F Senior Convertible Preferred Stock filed as Exhibit 2 hereto (the "Series F Certificate of Designation") and (iii) the Certificate of Voting Powers, Designations, Preferences and Relative, Participating, Optional or Other Special Rights of Series G Senior Non-Voting Convertible Preferred Stock filed as Exhibit 3 hereto (the "Series G Certificate of Designation," and together with the Series F Certificate of Designation, the "Certificates of Designation"). On February 1, 2000 Greenbriar redeemed 189,381 shares of Series G Preferred owned directly by Pooled Equity for an aggregate price of $2,500,000, which equals a price of $13.20 per share. Such redemption was pursuant to a letter agreement between LSOF Greenbriar and Greenbriar dated January 31, 2000 (the "First Letter Agreement"), filed as Exhibit 6 hereto, whereby Greenbriar agreed to use all proceeds, after payment of reasonable out-of-pocket expenses, from the sale or refinancing of capital assets to redeem shares of Preferred Stock. On March 1, 2000, LSOF Greenbriar assigned all of its rights in such - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 14 of 27 Pages - ------------------------------------------------------------------------------- letter agreement to Pooled Equity pursuant to an Assignment of Rights filed as Exhibit 8 hereto (the "Assignment of Rights"). On February 4, 2000, Greenbriar redeemed 75,722 shares of Series G Preferred owned directly by Pooled Equity for an aggregate price of $1,000,000, which equals a price of $13.20 per share. Such redemption was pursuant to a letter agreement between LSOF Greenbriar and Greenbriar dated February 4, 2000 filed as Exhibit 7 hereto. On March 1, 2000, LSOF Greenbriar assigned all of its rights in such letter agreement to Pooled Equity pursuant to the Assignment of Rights. On April 14, 2000 Greenbriar redeemed 37,200 shares of Series G Preferred owned directly by Pooled Equity for an aggregate price of $500,000, which equals a price of $13.44 per share. Such redemption was pursuant to a letter agreement between Pooled Equity and Greenbriar dated April 14, 2000 filed as Exhibit 9 hereto. While conducting due diligence in response to certain discussions with Greenbriar to modify and/or extend certain provisions of the Certificates of Designation, Pooled Equity learned and verified through review of Greenbriar's corporate records that, since the date of issuance of the Series F Preferred and the Series G Preferred, Greenbriar has issued (the "Option Issuances") various options (each a "Stock Option") to purchase shares of Common Stock to certain employees, officers and directors of Greenbriar. Greenbriar never notified Pooled Equity or any of its affiliates of these issuances, as required by the Certificates of Designation. These Option Issuances triggered the antidilution provisions under the Certificates of Designation, which provisions provide that the conversion price for the Preferred Stock shall be adjusted downward, based on the exercise prices per share of Common Stock with respect to these Option Issuances. The lowest exercise price for any Stock Option is $0.69 per share of Common Stock. Consequently, the conversion price for the Series F Preferred and the Series G Preferred has been automatically (and without further action on the part of Greenbriar or Pooled Equity) adjusted downward from $17.50 per share of Common Stock to $0.69 per share of Common Stock. As a result, each share of Preferred Stock, which had a liquidation preference of $10.00 per share, has become convertible into approximately 14.49 shares of Common Stock. On October 26, 2000, Terlingua purchased 2,200 shares (the "Terlingua Shares") of Common Stock on the open market for a purchase price of $0.75 per share. The aggregate purchase price for the Terlingua Shares was $1650.00 and was funded from working capital of Terlingua. On October 30, 2000, Pooled Equity delivered to Greenbriar a written Notice of Conversion (the "Conversion Notice"), filed as Exhibit 10 hereto, whereby Pooled Equity elected to convert the (i) 1,400,000 shares of Series F Preferred and (ii) 497,697 shares of Series G Preferred owned by it (a total of 1,897,697 shares of Preferred Stock) into 27,502,855 shares of Common Stock. The Conversion Notice directed Greenbriar to immediately issue to Pooled Equity the lesser of (i) 6,955,135 shares of Common Stock and (ii) such number of shares of Common Stock that would equal 49.8% of the outstanding Common Stock. The Conversion Notice also directed Greenbriar to issue the remaining shares (the "Remaining Common Shares") of Common Stock due to Pooled Equity as a result of the conversion of the Preferred Stock upon written notice from Pooled Equity that the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 had expired or terminated (or such act was no longer applicable) with respect the conversion of the Preferred Stock. On October 31, 2000, Greenbriar notified Pooled Equity that, in Greenbriar's opinion, the Conversion Notice may be invalid and/or that Pooled Equity may not have perfected its conversion rights with respect to the Preferred Stock. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 15 of 27 Pages - ------------------------------------------------------------------------------- In response to Greenbriar's allegation that the Conversion Notice may be invalid and/or that Pooled Equity may not have perfected its conversion rights with respect to the Preferred Stock, on November 3, 2000, Pooled Equity filed a petition (the "Petition") in State District Court in Dallas County, Texas (the "District Court") seeking a judgment declaring that the Conversion Notice is valid and effective as of October 30, 2000 and that it is entitled to convert the Preferred Stock into Common Stock at a price of $0.69 per share of Common Stock. Additionally, Pooled Equity seeks a permanent injunction barring Greenbriar from taking any action that would impair or prejudice Pooled Equity's rights in the Preferred Stock and Common Stock. A copy of the Petition has been filed as Exhibit 11. On November 20, 2000, Greenbriar filed its Original Answer and Counterclaim (the "Answer") denying the allegations contained in the Petition and alleged by counterclaim (the "Counterclaim") that Pooled Equity breached an agreement with Greenbriar regarding Greenbriar's sale of assets necessary to redeem the Preferred Stock. Pooled Equity will vigorously defend the Counterclaim. A copy of the Answer is attached hereto as Exhibit 12. On December 5, 2000, Pooled Equity delivered a Notice of Default ("Notice of Default") to Greenbriar notifying Greenbriar that it was in breach of Section 6.26 of the Stock Purchase Agreement for failure to comply with the Conversion Notice. A copy of the Notice of Default is attached hereto as Exhibit 13. On December 5, 2000, Pooled Equity also delivered a letter (the "Make Whole Letter") notifying Greenbriar that Pooled Equity was demanding payment of $8,587,059 (the "Make Whole Amount"). Pursuant to that certain Agreement (the "Make Whole Agreement"), dated as of December 31, 1997, by and between Greenbriar and Lone Star, the Make Whole Amount became due on the tenth business day after the date on which all of the Preferred Stock was converted into shares of Common Stock. A copy of the Make Whole Agreement is attached hereto as Exhibit 14. On December 11, 2000, Pooled Equity filed a Demand for Arbitration Before the American Arbitration Association (the "Arbitration Demand") seeking to consolidate and enforce its claims contained in the Petition, the Notice of Default and the Make Whole Letter. Pooled Equity's claims under the Stock Purchase Agreement and the Make Whole Agreement require all disputes arising thereunder to be resolved by arbitration with the American Arbitration Association. On January 5, 2001, Greenbriar filed a Motion to Stay Arbitration (the "Motion to Stay") with the District Court. As of the date hereof, the District Court has not ruled on the Arbitration Demand or the Motion to Stay. On January 11, 2001, Pooled Equity filed an application for a temporary restraining order with the District Court to prevent the automatic conversion of its Preferred Stock into Common Stock on January 13, 2001 in accordance with the Certificates of Designation. The District Court denied Pooled Equity's application for a temporary restraining order. On January 12, 2001, Pooled Equity delivered a Notice of Default (the "Second Notice of Default") to Greenbriar notifying Greenbriar that Events of Default have occurred under the covenants contained in Sections 6.8(e), 6.29, 6.30, 6.31, 6.32 and 6.33 of the Stock Purchase Agreement. As a result of such Events of Default, Greenbriar owes Pooled Equity additional dividends of 12% per annum and Pooled Equity may put the Preferred Stock to Greenbriar for 20% of such Preferred Stock's liquidation value. In addition, interest on all unpaid dividends is accruing at the rate of 12% per annum. As a result of Greenbriar's failure to comply with the foregoing covenants, and its failure to pay such accrued additional dividends for two consecutive quarters, Pooled Equity, through its ownership of Series F Preferred, has the right to appoint 70% of the Board of Directors membership of Greenbriar. All such remedies arose prior to the mandatory conversion of the Preferred Stock described below. A copy of the Second Notice of Default is attached hereto as Exhibit 15. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 16 of 27 Pages - ------------------------------------------------------------------------------- On January 12, 2001, Pooled Equity also delivered a notice (the "Observer Notice") to Greenbriar of Pooled Equity's exercise of its right, under the Series F Certificate of Designation and the Stock Purchase Agreement, to attend all Board of Directors meetings and any committees thereof. A copy of the Observer Notice is attached hereto as Exhibit 16. On January 13, 2001, Greenbriar delivered notices (the "Mandatory Conversion Notices") that pursuant to Section 6.3 of each of the Certificates of Designation, Pooled Equity's 1,400,000 shares of Series F Preferred and 444,854 shares of Series G Preferred were automatically converted at a conversion price of $17.50 per share of Common Stock into 800,000 and 254,202 shares of Common Stock, respectively. In addition, Greenbriar notified Pooled Equity that, based upon its records, Greenbriar owes Pooled Equity a total of $27,166,714 under the Make Whole Agreement (the "Make Whole Payments"). Greenbriar further stated in the Mandatory Conversion Notices that it was unable to make the Make Whole Payments at this time but that it intends to do so pursuant to the terms of the Make Whole Agreement and as permitted by Section 78.288 of the Nevada Revised Statutes. Copies of the Mandatory Conversion Notices are attached hereto as Exhibits 17 and 18. On January 15, 2001, Pooled Equity delivered a letter to Greenbriar responding to the Mandatory Notices (the "Mandatory Conversion Response Letter"). Pooled Equity stated in the Mandatory Conversion Response Letter that: (1) the proper conversion price for the Preferred Stock was $0.69 per share of Common Stock; (2) the number of shares of Series G Preferred owned by Pooled Equity is 497,697, not 444,854 as stated in the Mandatory Conversion Notice; (3) Pooled Equity never agreed to the alleged redemption of 50,946 shares of Series G Preferred on December 20, 2000. The proceeds of $760,000 received in such alleged redemption was never discussed and it is Pooled Equity's view that such amount should apply to amounts owing to Pooled Equity under the Make Whole Amount; and (4) Greenbriar's calculation of the liquidation value of the Preferred Stock fails to include penalty dividends accruing since at least June 30, 2000, late interest on such dividends accruing at 12% per annum and Pooled Equity's cost and expenses payable pursuant to the Stock Purchase Agreement. A copy of the Mandatory Conversion Response Letter is attached hereto as Exhibit 19. Pooled Equity intends to pursue all legal remedies available to it. ITEM 4. PURPOSE OF THE TRANSACTION. The transactions described in Item 3 above occurred as a result of privately negotiated transactions with Greenbriar. In each case, Lone Star acquired the Preferred Stock and the Common Stock issuable upon conversion thereof and Terlingua acquired the Terlingua Shares for investment purposes. Once the Remaining Common Shares are issued to Pooled Equity and Pooled Equity thereby becomes a majority Stockholder of Greenbriar, Pooled Equity intends to seek majority representation on the board of directors of Greenbriar as promptly as is practicable and, through such board representation, influence the management of Greenbriar. While Pooled Equity does not have any plans for any extraordinary corporate or sale transactions involving Greenbriar, Pooled Equity intends to consider strategic alternatives to maximize stockholder value. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 17 of 27 Pages - ------------------------------------------------------------------------------- Pooled Equity intends to make open market purchases of Common Stock from time to time. Other than as described above, none of Pooled Equity or any Control Person has any present plans or intentions which would result in or relate to any of the transactions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D. ITEM 5. INTEREST IN SECURITIES OF THE ISSUER. Pooled Equity, GenPar, Lone Star, Partner, and Management each beneficially owns and has the sole power to vote and dispose of 27,502,855 shares of Common Stock as described above (approximately 79.7% of the shares of Common Stock based on the information as to the number of shares of Common Stock outstanding on November 11, 2000, as reported in Greenbriar's Quarterly Report on Form 10-Q for the period ended September 30, 2000). Hudson, Associates, Advisors and Grayken each beneficially owns and has the sole power to vote and dispose of 27,505,055 shares of Common Stock as described above (approximately 79.7% of the shares of Common Stock based on the information as to the number of shares of Common Stock outstanding on November 11, 2000, as reported Greenbriar's Quarterly Report on Form 10-Q for the period ended September 30, 2000). Terlingua beneficially owns and has the sole power to vote and dispose of 2,200 shares of Common Stock as described above (approximately 0.03% of the shares of Common Stock based on the information as to the number of shares of Common Stock outstanding on November 11, 2000, as reported Greenbriar's Quarterly Report on Form 10-Q for the period ended September 30, 2000). Except as described in Item 3, none of Pooled Equity or any Control Person has effected any transaction in any shares of Common Stock during the past sixty days. ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER. Certain rights relating to the Preferred Stock granted to Pooled Equity, as an assignee of Lone Star and LSOF Greenbriar, by Greenbriar are set forth in the Stock Purchase Agreement. Additional rights relating to the Preferred Stock granted to Pooled Equity are set forth in the Certificates of Designation. Certain registration rights granted to Pooled Equity are set forth in a Registration Rights Agreement dated as of December 31, 1997 filed as Exhibit 4 hereto. In connection with the purchase of the Preferred Stock, Greenbriar and Lone Star entered into the Make Whole Agreement filed as Exhibit 5 hereto which generally provides that Greenbriar is obligated to make a cash payment to the holder of the Preferred Stock sufficient to provide a 20% annual rate of return on Lone Star's purchase of the Preferred Stock (including dividends received by such holder) upon conversion of all of the Preferred Stock into Common Stock, or in certain other events including, a repurchase of the Preferred Stock by Greenbriar based upon a breach by Greenbriar of certain provisions in the Stock Purchase Agreement. Upon the conversion of the Preferred Stock into Common Stock, an estimated payment (as determined by Pooled Equity) of approximately $8.6 million became due from Greenbriar to Pooled Equity pursuant to the Make Whole Agreement. ITEM 7. MATERIAL TO BE FILED AS EXHIBITS. 1. Stock Purchase Agreement dated as of December 31, 1997 between Greenbriar and Lone Star. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 18 of 27 Pages - ------------------------------------------------------------------------------- 2. Certificate of Voting Powers, Designations, Preferences and Relative, Participating, Optional or Other Special Rights of Series F Senior Convertible Preferred Stock of Greenbriar Corporation. 3. Certificate of Voting Powers, Designations, Preferences and Relative, Participating, Optional or Other Special Rights of Series G Senior Non-Voting Convertible Preferred Stock of Greenbriar Corporation. 4. Registration Rights Agreement dated as of January 13, 1998 between Greenbriar and Lone Star. 5. Agreement dated as of December 31, 1997 between Greenbriar and Lone Star. 6. Letter Agreement dated as of January 31, 2000 between LSOF Greenbriar and Greenbriar. 7. Letter Agreement dated as of February 4, 2000 between LSOF Greenbriar and Greenbriar. 8. Assignment of Rights dated March 1, 2000 between LSOF Greenbriar and Pooled Equity. 9. Letter Agreement dated as of April 14, 2000 between Pooled Equity and Greenbriar. 10. Notice of Conversion dated as of October 30, 2000 from Pooled Equity to Greenbriar. 11. Pooled Equity's Original Petition (Cause No. 00-08824-I), filed on November 3, 2000, in State District Court, Dallas County, Texas. 12. Greenbriar's Original Answer and Counterclaim, filed on November 20, 2000, in State District Court, Dallas County, Texas. 13. Notice of Default, dated December 5, 2000. 14. Make Whole Letter, dated December 5, 2000. 15. Second Notice of Default, dated January 12, 2001. 16. Observer Notice, dated January 12, 2001. 17. Mandatory Conversion Notice, dated January 13, 2001. 18. Mandatory Conversion Notice, dated January 13, 2001. 19. Mandatory Conversion Response Letter, dated January 15, 2001. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 19 of 27 Pages - ------------------------------------------------------------------------------- SIGNATURE After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: January 25, 2001 LSOF POOLED EQUITY, L.P. By: LSOF GenPar, Inc., its General Partner By:/s/ Benjamin D. Velvin III --------------------------------- Benjamin D. Velvin III Vice President Date: January 25, 2001 LSOF GENPAR, INC. By:/s/ Benjamin D. Velvin III ----------------------------------------- Benjamin D. Velvin III Vice President Date: January 25, 2001 LONE STAR OPPORTUNITY FUND, L.P. By: Lone Star Partner, L.P., its General Partner By: Lone Star Management Co., Ltd., its: General Partner By:/s/ Benjamin D. Velvin III ---------------------------- Benjamin D. Velvin III Vice President - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 20 of 27 Pages - ------------------------------------------------------------------------------- Date: January 25, 2001 LONE STAR PARTNER, L.P. By: Lone Star Management Co., Ltd., its: General Partner By:/s/ Benjamin D. Velvin III -------------------------------------- Benjamin D. Velvin III Vice President Date: January 25, 2001 LONE STAR MANAGEMENT CO., LTD. By:/s/ Benjamin D. Velvin III ----------------------------------------- Benjamin D. Velvin III Vice President Date: January 25, 2001 HUDSON ADVISORS, L.L.C. By:/s/ Steven R. Shearer ----------------------------------------- Steven R. Shearer Vice President Date: January 25, 2001 TERLINGUA ADVISORS, INC. By:/s/ Steven R. Shearer ----------------------------------------- Steven R. Shearer Vice President Date: January 25, 2001 ADVISORS GENPAR, INC. By:/s/ Benjamin D. Velvin III ----------------------------------------- Benjamin D. Velvin III Vice President Date: January 25, 2001 HUDSON ADVISORS ASSOCIATES, L.P. By: Advisors GenPar, Inc. its: General Partner By:/s/Benjamin D. Velvin III ---------------------------------- Benjamin D. Velvin III Vice President - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 21 of 27 Pages - ------------------------------------------------------------------------------- Date: January 25, 2001 /s/ John P. Grayken --------------------------------------------- John P. Grayken - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 22 of 27 Pages - ------------------------------------------------------------------------------- EXHIBIT INDEX 99.1 Stock Purchase Agreement dated as of December 31, 1997 between Greenbriar and Lone Star.* 99.2 Certificate of Voting Powers, Designations, Preferences and Relative, Participating, Optional or Other Special Rights of Series F Senior Convertible Preferred Stock of Greenbriar Corporation.* 99.3 Certificate of Voting Powers, Designations, Preferences and Relative, Participating, Optional or other Special Rights of Series G Senior Non-Voting Convertible Preferred Stock of Greenbriar Corporation.* 99.4 Registration Rights Agreement dated as of January 13, 1998 between Greenbriar and Lone Star.* 99.5 Agreement dated as of December 31, 1997 between Greenbriar and Lone Star.* 99.6 Letter Agreement dated January 31, 2000 between LSOF Greenbriar and Greenbriar.** 99.7 Letter Agreement dated February 4, 2000 between LSOF Greenbriar and Greenbriar.** 99.8 Assignment of Rights dated March 1, 2000 between LSOF Greenbriar and Pooled Equity.** 99.9 Letter Agreement dated April 14, 2000 between Pooled Equity and Greenbriar.*** 99.10 Notice of Conversion dated as of October 30, 2000 from Pooled Equity to Greenbriar.**** 99.11 Pooled Equity's Original Petition (Cause No. 00-08824-I), filed on November 3, 2000, in State District Court, Dallas County, Texas.***** 99.12 Greenbriar's Original Answer and Counterclaim, filed on November 20, 2000, in State District Court, Dallas County, Texas. 99.13 Notice of Default, dated December 5, 2000. 99.14 Make Whole Letter, dated December 5, 2000. 99.15 Second Notice of Default, dated January 12, 2001. 99.16 Observer Notice, dated January 12, 2001. 99.17 Mandatory Conversion Notice, dated January 13, 2001. 99.18 Mandatory Conversion Notice, dated January 13, 2001. 99.19 Mandatory Conversion Response Letter, dated January 15, 2001. *Incorporated by reference to the Schedule 13D filed on behalf of Lone Star Opportunity Fund, L.P. on January 22, 1998. **Incorporated by reference to the Schedule 13D (Amendment No. 1) filed on behalf of LSOF Pooled Equity, L.P. on April 6, 2000. ***Incorporated by reference to the Schedule 13D (Amendment No. 2) filed on behalf of LSOF Pooled Equity, L.P. on April 28, 2000. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 23 of 27 Pages - ------------------------------------------------------------------------------- ****Incorporated by reference to the Schedule 13D (Amendment No. 3) filed on behalf of LSOF Pooled Equity, L.P. on November 2, 2000. *****Incorporated by reference to Schedule 13D (Amendment No. 4) filed on behalf of LSOF Pooled Equity, L.P. on November 3, 2000. - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 24 of 27 Pages - ------------------------------------------------------------------------------- SCHEDULE I ---------- Instruction C. Information for Officers and Directors of GenPar, Management, Hudson, Advisors and Terlingua. OFFICERS OF GENPAR Name: J.D. Dell Present Principal Occupation or Employment: Vice President Business Address: LSOF GenPar, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Benjamin D. Velvin, III Present Principal Occupation or Employment: Vice President and Assistant Secretary Business Address: LSOF GenPar, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Louis Paletta Present Principal Occupation or Employment: Vice President Business Address: LSOF GenPar, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Len W. Allen, Jr. Present Principal Occupation or Employment: Vice President Business Address: LSOF GenPar, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 25 of 27 Pages - ------------------------------------------------------------------------------- OFFICERS OF MANAGEMENT Name: John P. Grayken Present Principal Occupation or Employment: President Business Address: 50 Welbeck Street London, United Kingdom W1M 7HE Name: J.D. Dell Present Principal Occupation or Employment: Vice President Business Address: Lone Star Management Co., Ltd. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Louis Paletta Present Principal Occupation or Employment: Vice President Business Address: Lone Star Management Co., Ltd. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Benjamin D. Velvin III Present Principal Occupation or Employment: Vice President and Assistant Secretary Business Address: Lone Star Management Co., Ltd. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 26 of 27 Pages - ------------------------------------------------------------------------------- DIRECTORS AND OFFICERS OF ADVISORS Name: Benjamin D. Velvin III Present Principal Occupation or Employment: Vice President Business Address: Advisors GenPar, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: J.D. Dell Present Principal Occupation or Employment: Vice President Business Address: Advisors GenPar, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 27 of 27 Pages - ------------------------------------------------------------------------------- OFFICERS OF HUDSON Name: Robert J. Corcoran Present Principal Occupation or Employment: President and Chief Financial Officer Business Address: Hudson Advisors, L.L.C. 600 North Pearl Street Suite 1500 Dallas, Texas 75201 Name: J.D. Dell Present Principal Occupation or Employment: Executive Vice President Business Address: Hudson Advisors, L.L.C. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Steven R. Shearer Present Principal Occupation or Vice President Employment: Business Address: Hudson Advisors, L.L.C. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 - ------------------------------------------------------------------------------- CUSIP No. 393648-10-0 13D Page 28 of 27 Pages - ------------------------------------------------------------------------------- DIRECTORS & OFFICERS OF TERLINGUA Name: Robert J. Corcoran Present Principal Occupation or Employment: Director and President Business Address: Terlingua Advisors, Inc. 600 North Pearl Street Suite 1500 Dallas, Texas 75201 Name: J.D. Dell Present Principal Occupation or Employment: Director and Vice President Business Address: Terlingua Advisors, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 Name: Steven R. Shearer Present Principal Occupation or Employment: Vice President Business Address: Terlingua Advisors, Inc. 600 North Pearl Street Suite 1500 Dallas, Texas 75201 Name: Len W. Allen, Jr. Present Principal Occupation or Employment: Vice President Business Address: Terlingua Advisors, Inc. 600 North Pearl Street Suite 1550 Dallas, Texas 75201 EX-99 2 0002.txt EXHIBIT 99.12 EXHIBIT 99.12 ------------- NO. 00-08824 LSOF POOLED EQUITY, L.P. ss. IN THE DISTRICT COURT ss. v. ss. 162ND JUDICIAL DISTRICT ss. GREENBRIAR CORPORATION ss. DALLAS COUNTY, TEXAS DEFENDANT'S ORIGINAL ANSWER AND COUNTERCLAIM -------------------------------------------- TO THE HONORABLE JUDGE OF SAID COURT: NOW COMES, Greenbriar Corporation, Defendant in the above entitled and numbered cause, files this its Original Answer and Counterclaim to Plaintiff's Original Petition filed herein, and for same would respectfully show unto the Court as follows: I. GENERAL DENIAL -------------- 1. Defendant Greenbriar Corporation denies each and every, all and singular, the material allegations contained in Plaintiff's Original Petition and demands strict proof thereof by a preponderance of the evidence. This constitutes a general denial under Tex. R. Civ. P. 92. II. SPECIFIC DENIALS AND AFFIRMATIVE DEFENSES ----------------------------------------- 2. Greenbriar specifically denies that all conditions precedent necessary to Plaintiff's action have either occurred or have been performed, excused, or waived. 3. Contrary to what Plaintiff asserts, an adjustment to the Conversion Price does not occur automatically. Instead, the Certificates of Obligation describe precise procedures that must be followed for a Conversion Price adjustment to take place. These procedures are intended to prevent any "automatic" or inadvertent adjustment to the Conversion Price. None of those procedures occurred, so no adjustment to the Conversion Price has taken place. The Conversion Price remains at $17.50. 4. Greenbriar has tendered to Plaintiff the amount of shares to which Plaintiff would be entitled, were Plaintiff exercising its conversion rights. Plaintiff, however, returned those shares and stated that Plaintiff was not converting its preferred shares at $17.50. 5. Additionally and/or alternatively, the options that allegedly gave grounds for an adjustment to the Conversion Price were terminated before Plaintiff tendered its offer to convert. Consequently, the correct Conversion Price was $17.50. Plaintiff itself has rejected any conversion at that price. 6. Additionally and/or alternatively, the options that allegedly gave grounds for an adjustment to the Conversion Price have been rescinded and annulled. The Certificates of Designation contemplated just such action and, accordingly, expressly provide that the Conversion Price remain at $17.50. 7. Additionally and/or alternatively, Plaintiff did not follow the correct procedures to convert any of its preferred shares if there was an adjustment in the conversion price. 8. Greenbriar has not committed any alleged default in reserving a sufficient number of shares of common stock. Consequently, Plaintiff is not entitled to any of the remedies set forth in the Certificates of Obligation. 9. To the contrary, Plaintiff's agreement with Greenbriar requires Greenbriar to stay listed on the American Stock Exchange which in turn prohibits Greenbriar from issuing, without shareholder approval, 20% or more of its outstanding shares. Thus, Plaintiff's attempted conversion at $0.69 would have forced Greenbriar to breach the agreement and consequently, was null and void, and of no effect. 10. Moreover, the Plaintiff attempt at conversion requested a totally improper number of shares. Specifically, Plaintiffs' attempted conversion purported to direct Greenbriar to issue Plaintiff 27,493 more shares than it would have been entitled to, even if the Conversion Price had been $0.69 per share, which Greenbriar strenuously denies. 11. Plaintiff has undoubtedly realized that it has less than 60 days to the mandatory conversion date of January 13, 2001 at a Conversion Price of $17.50. Plaintiff's actions described in its petition simply represent a transparent attempt to circumvent this mandatory conversion obligation. 12. Plaintiff is not entitled to injunctive relief because there is no immediate and irreparable injury or harm to Plaintiff. 13. Plaintiff is not entitled to injunctive relief because it has an adequate remedy at law. 14. Plaintiff is not entitled to injunctive relief because it would, by causing a forfeiture of 80% of the Common Stock to Plaintiff in a windfall, usurp the status quo, not preserve it. 15. Plaintiff is not entitled to injunctive relief because it seeks injunctive relief with unclean hands. Plaintiff has engaged in bad faith and/or inequitable conduct which precludes the exercise of its conversion rights. 16. Plaintiff has waived and/or is estopped from converting the Preferred Stock to Common Stock at $.0.69 per share. 17. Additionally and/or in the alternative, Plaintiff has treated the Preferred Stock Redemption Obligation, as in substance, a debt or loan. To the extent that is so, such debt or loan includes a charge for the use, forbearance, or detention of money that constitutes interest. This interest exceeds the amount allowed by law. Hence, the Preferred Stock Redemption Obligation is usurious. III. COUNTERCLAIM ------------ Greenbriar Corporation, Defendant in this action, as counter-plaintiff ("Greenbriar") complains of Plaintiff, LSOF Pooled Equity, L.P., as counter-defendant ("Lone Star"), and for cause of action alleges the following by way of counterclaim: BREACH OF CONTRACT ------------------ On January 13, 1998, Lone Star and Greenbriar entered into a Stock Purchase Agreement with an effective date of December 31, 1997 which included a Preferred Stock Redemption Obligation. Specifically, Lone Star paid $22,000,000 to Greenbriar for the following shares of Greenbriar Preferred Stock: (i) 1,400,000 shares of Greenbriar's Series F Senior Convertible Preferred Stock, and (ii) 800,000 shares of Greenbriar's Series G Senior Non-Voting Convertible Preferred Stock. Lone Star and Greenbriar agreed that Greenbriar, through a series of asset sales and refinancings would redeem all of the Preferred Stock in Greenbriar held by Lone Star. In accordance with the redemption agreement, Greenbriar began to sell and/or refinance certain capital assets and the first payment occurred on January 31, 2000. Greenbriar used the proceeds from such sales or refinancing efforts to redeem the preferred stock shares held by Lone Star. On each of these asset sales or refinancings, Lone Star accepted the net proceeds and tendered its certificates representing the redeemed preferred stock. Despite the redemption agreement, Lone Star has wrongfully refused to allow Greenbriar to complete its plan of asset sales or refinancings. Lone Star' s actions constitute a breach of contract. As a result of Lone Star's breach of contract, Greenbriar has been damaged in a sum which exceeds the minimum jurisdictional limits of the Court. Because of Lone Star's actions, Greenbriar has been required to retain the services of counsel to prosecute this claim. Accordingly, under TEX.CIV.PRAC. & REM. CODE ss. 38.001 et seq., Greenbriar is entitled to recover reasonable attorney's fees from Lone Star. Alternatively and/or additionally, Lone Star and Greenbriar reached agreement on a restructuring of the payments from Greenbriar to Lone Star. As a part of this agreement, Lone Star agreed that Greenbriar would refinance or liquidate substantial assets in order to repay Lone Star. These transactions would occur in an orderly fashion and, accordingly, Lone Star agreed to forbear from any drastic action that would interfere with the transactions. Lone Star's actions in attempting to take over 80% of the Common Stock, thereby effectuating a "change in control" as defined in many agreements representing Greenbriar's substantial assets, interfere with Greenbriar's efforts to refinance or liquidate. Lone Star's actions therefore constitute a breach of contract. As a result of Lone Star's breach of contract, Greenbriar has been damaged in a sum which exceeds the minimum jurisdictional limits of the Court. Because of Lone Star's actions, Greenbriar has been required to retain the services of counsel to prosecute this claim. Accordingly, under TEX.CIV.PRAC. & REM. CODE ss. 38.001 et seq., Greenbriar is entitled to recover reasonable attorney's fees from Lone Star. IV. PRAYER FOR RELIEF ----------------- WHEREFORE PREMISES CONSIDERED, Greenbriar Corporation requests judgment of the court against Lone Star as follows: 1. Lone Star take nothing by its suit. 2. For damages within the jurisdictional limits of the court. 3. Prejudgment and postjudgment interest as provided by law. 4. Prejudgment and postjudgment interest as provided by law. 5. Reasonable attorneys' fees. 6. Costs of suit. 7. Such other and further relief to which Greenbriar may be justly entitled. Respectfully submitted, SUSMAN GODFREY L.L.P By: /s/ Terrell W. Oxford ------------------------------------- Terrell W. Oxford State Bar No. 15390500 Salvador Espino State Bar No. 00795007 901 Main Street, Ste. 4100 Dallas, Texas 75202 Telephone: (214) 754-1908 Telecopy: (214) 665-0853 Attorneys for Defendant Greenbriar Corporation CERTIFICATE OF SERVICE ---------------------- This is to certify that on this the 20th day of November, 2000, a true and correct copy of the above and foregoing instrument was properly forwarded to the following counsel of record in accordance with Rules 21 and 21a of the Texas Rules of Civil Procedure as indicated below: T. Ray Guy VIA CERTIFIED MAIL- K. Todd Phillips ------------------- Weil, Gotshal & Manges L.L.P. RETURN RECEIPT REQUESTED 100 Crescent Court, Suite 1300 ------------------------ Dallas, Texas 75201-6950 /s/ Salvador Espino -------------------------------- Salvador Espino EX-99 3 0003.txt EXHIBIT 99.13 EXHIBIT 99.13 ------------- NOTICE OF DEFAULT December 5, 2000 Greenbriar Corporation 4265 Kellway Circle Addison, Texas 75244 Attention: Gene S. Bertcher Gentlemen: Reference is made to (i) those certain Certificates of Voting Power, Designations, Preferences, and Relative, Participating, Optional or Other Special Rights of Series F Senior Convertible Preferred Stock (the "Series F Stock") and Series G Senior Non-Voting Convertible Preferred Stock (the "Series G Stock") of Greenbriar Corporation ("Greenbriar") (collectively, the "Certificates") and (ii) that certain Stock Purchase Agreement (the "Purchase Agreement") between Greenbriar and Lone Star Opportunity Fund, L.P. ("LSOF"), dated as of December 31, 1997. Capitalized terms used herein and not otherwise defined are used as defined in the Certificates. It has come to the attention of the undersigned that Greenbriar has failed to comply with Section 6.26 of the Purchase Agreement which, among other things, prohibits Greenbriar from violating (i) the provisions of its articles of incorporation and (ii) any obligation, provision, condition, covenant or requirement contained in the Transaction Documents (as defined in the Purchase Agreement), if that violation or default would result in a material impairment of the ability of any holder of Preferred Stock (as defined in the Purchase Agreement) to enforce any of Greenbriar's obligations or any of such holder's rights in connection with the Preferred Stock. Greenbriar's failure to properly comply with the Notice of Conversion (the "Notice of Conversion"), dated as of October 30, 2000 that was delivered by LSOF to Greenbriar constitutes Greenbriar's failure to comply with Section 6.26 of the Purchase Agreement. As a result, under the Certificates, an Event of Default has occurred. Pursuant to Section 8 of each of the Certificates, upon the occurrence and during the continuance of an Event of Default, the undersigned is entitled to: (i) an additional dividend of 12% per annum and (ii) put its Series F Stock and Series G Stock to Greenbriar for 120% of the Liquidation Value. In addition, pursuant to Section 8 of the Certificate for the Series F Stock, upon the occurrence and during the continuance of an Event of Default the holders of the Series F Stock will be entitled to designate and have appointed a number of persons to the Board of Directors of Greenbriar that will constitute 70% of the members thereof. The undersigned hereby informs Greenbriar that (i) it expects to be paid the additional dividends on the Series F Stock and Series G Stock referred to above from the date that the Event of Default first took place and (ii) that it intends to designate and have appointed the maximum number of Board members that it is entitled to under Section 8 of the Certificate for the Series F Stock. The undersigned will provide Greenbriar with the names of such Board member designees shortly. The undersigned further informs Greenbriar that it does not waive any other rights or remedies that it may have arising as a result of Greenbriar's failure to comply with Section 6.26 of the Purchase Agreement and as a result of the Event of Default arising therefrom including, without limitation, the undersigned's right to put the Series F Stock and Series G Stock to Greenbriar. LSOF POOLED EQUITY, L.P. By: LSOF GenPar, Inc., Its General Partner By: /s/J.D. Dell ---------------------------------------- J.D. Dell Vice President EX-99 4 0004.txt EXHIBIT 99.14 EXHIBIT 99.14 ------------- 600 North Pearl Street Suite 1550, LB 161 Dallas, Texas 76140 LSOF POOLED EQUITY, L.P. December 5, 2000 Mr. Gene S. Bertcher Greenbriar Corporation 4265 Kellway Circle Addison, TX 75001 Re: LSOF Pooled Equity, L.P. Board Rights Dear Mr. Bertcher: You are hereby notified that Greenbriar Corporation ("Greenbriar") is required to pay to LSOF Pooled Equity, L.P. ("Lone Star") the amount of $8,587,059 (the "Make Whole Amount"), by wire transfer of immediately available funds to Lone Star. Wiring instructions for Lone Star are set forth below. Pursuant to that certain Agreement (the "Make Whole Agreement"), dated as of December 31, 1997, by and between Greenbriar and Lone Star, the Make Whole Amount became due on the tenth business day after the date on which all of the Series F Senior Preferred Stock (as defined in the Make Whole Agreement) and all of the Series G Senior Non-Voting Preferred Stock (as defined in the Make Whole Agreement and, with the Series F Senior Preferred Stock, the "Preferred Stock") were converted into shares of Greenbriar Common Stock (as defined in the Make Whole Agreement). Lone Star delivered a Notice of Conversion to you on October 30, 2000, converting the Preferred Stock at a conversion rate of $0.69 per share of Greenbriar Common Stock. Consequently, the Make Whole Amount became due on November 13, 2000 and, pursuant to the Make Whole Agreement, became payable on or before November 9, 2000. In your letter dated November 6, 2000, you indicate that the make whole amount should be $26,749,743.03, based on a conversion rate of $17.50 per share of Greenbriar Common Stock. While Lone Star does not waive any right it may have to such greater amount, demand is made hereby for the amount of $8,587,059, which you do not dispute, together with all costs and expenses provided by law. Wire transfer instructions for Lone Star are as follows: ACCOUNT NAME: Lone Star Opportunity Fund, L.P. ACCOUNT NUMBER: 073-03034030 RECEIVING BANK: Chase Bank of Texas Houston, Texas ABA #: 113-000-609 REFERENCE: LSOF Pooled Equity, L.P. If you have any questions concerning this letter, please telephone Mr. Michael A. Saslaw, counsel for Lone Star, at 214-746-8117. LSOF POOLED EQUITY, L.P. By: LSOF GenPar, Inc., its General Partner By: /s/ J.D. Dell ---------------------------------------- Name: J.D. Dell Title: Vice President cc: Len Allen Michael A. Saslaw Mark E. Bennett Ronald L. Brown Terrell W. Oxford Michael T. Tarski EX-99 5 0005.txt EXHIBIT 99.15 EXHIBIT 99.15 ------------- NOTICE OF DEFAULT January 12, 2001 Greenbriar Corporation 4265 Kellway Circle Addison, Texas 75244 Attention: Gene S. Bertcher Gentlemen: Reference is made to (i) those certain Certificates of Voting Power, Designations, Preferences, and Relative, Participating, Optional or Other Special Rights of Series F Senior Convertible Preferred Stock (the "Series F Stock") and Series G Senior Non-Voting Convertible Preferred Stock (the "Series G Stock") of Greenbriar Corporation ("Greenbriar") (collectively, the "Certificates") and (ii) that certain Stock Purchase Agreement (the "Purchase Agreement") between Greenbriar and Lone Star Opportunity Fund, L.P. ("LSOF"), dated as of December 31, 1997. Capitalized terms used herein and not otherwise defined are used as defined in the Certificates. Greenbriar has entirely failed to comply with Section 6.8(e) of the Purchase Agreement, which requires Greenbriar to deliver a quarterly compliance certificate with respect to various financial covenants set forth in the Purchase Agreement. Nevertheless, it has come to the attention of the undersigned that, based on a review of Greenbriar's publicly available financial information, Greenbriar has, since at least June 30, 2000, failed to comply with at least the financial covenants set forth in Sections 6.29, 6.30, 6.31, 6.32 and 6.33 of the Purchase Agreement (the "Financial Covenants"). A copy of the report of PriceWaterhouseCoopers LLP containing its calculations with respect to the Financial Covenants is attached hereto as Exhibit A. Greenbriar's failure to deliver each of the quarterly compliance certificates and comply with each of the Financial Covenants constitute Events of Default under each of the Certificates. LSOF has not waived any of these defaults in writing, nor has Greenbriar cured any of such Events of Default in accordance with the requirements set forth in the Certificates. Greenbriar has also violated Section 8.1 of each Certificate by failing to notify LSOF of each such Event of Default within 10 days of the occurrence thereof. We hereby make demand for immediate delivery of all compliance certificates required by the Purchase Agreement and all notices required pursuant to Section 8.1 of each Certificate, including, without limitation, all such certificates and notices which you have previously failed to deliver. Pursuant to Section 8 of each of the Certificates, upon the occurrence and during the continuance of an Event of Default, the undersigned is entitled: (i) to an additional dividend of 12% per annum and (ii) to put its Series F Stock and Series G Stock to Greenbriar for 120% of the Liquidation Value. Moreover, pursuant to Section 3.1 of each of the Certificates, interest on all unpaid dividends is accruing at the rate of 12% per annum. The failure of Greenbriar to pay the additional dividends accruing since June 30, 2000, constitutes yet another Event of Default under the Certificates. Pursuant to Section 8 of the Certificate for the Series F Stock, upon the occurrence and during the continuance of an Event of Default arising from the failure of Greenbriar to pay accrued dividends to LSOF for two full quarters, whether or not the payment of such dividends is legally permissible, the holders of the Series F Stock are entitled to designate and have appointed a number of persons to the Board of Directors of Greenbriar that will constitute 70% of the members thereof. The undersigned hereby informs Greenbriar that it expects to be paid the additional dividends on the Series F Stock and Series G Stock referred to above from the date that the first Event of Default initially occurred, together with interest thereon. The undersigned further informs Greenbriar that it does not waive any other rights or remedies that it may have arising as a result of the Events of Default described herein and any other Events of Default that may have occurred, including, without limitation, the undersigned's right to put the Series F Stock and Series G Stock to Greenbriar and to appoint directors of Greenbriar. LSOF POOLED EQUITY, L.P. By: LSOF GenPar, Inc., Its General Partner By: /s/ J.D. Dell ----------------------------------------- J.D. Dell Vice President cc: Mark E. Bennett Ronald L. Brown T. Ray Guy Terrell W. Oxford Michael A. Saslaw EX-99 6 0006.txt EXHIBIT 99.16 EXHIBIT 99.16 ------------- LSOF POOLED EQUITY, L.P. January 12, 2001 Mr. James R. Gilley Greenbriar Corporation 4265 Kellway Circle Addison, TX 75001 Re: LSOF Pooled Equity, L.P. Board Rights, etc. Dear Mr. Gilley: You are hereby notified that, until further written notice, LSOF Pooled Equity, L.P. ("LSOF") is exercising its right to attend all meetings of the Board of Directors and any committees thereof (the "Board") of Greenbriar Corporation (the "Company"). LSOF has such right pursuant to (i) Section 5.1 of the Certificate of Voting Power, Designations, Preferences, and Relative Participating, Optional or Other Special Rights of Series F Senior Convertible Preferred Stock, of the Company or, alternatively, (ii) Section 8.1 of that certain Securities Purchase Agreement, dated as of December 31, 1997, by and between Lone Star Opportunity Fund, L.P. and the Company (the "Purchase Agreement"). Please notify me at the address set forth above as to the time and location of all meetings of the Board as promptly as is practicable but, in any event, in compliance with the minimum notice requirements set forth in the Company's Bylaws. In addition, until further notice, please provide me with (i) all materials provided to the Board in advance of any meeting or in connection with the execution of any written consent and (ii) a calendar of all anticipated or regularly scheduled meetings of the Board. LSOF Pooled Equity, L.P. By: LSOF GenPar, Inc., its General Partner By: /s/ J.D. Dell ----------------------------------------------------------- Name: J.D. Dell Title: Vice President cc: Mark E. Bennett Ronald L. Brown T. Ray Guy Terrell W. Oxford Michael A. Saslaw EX-99 7 0007.txt EXHIBIT 99.17 EXHIBIT 99.17 ------------- [GREENBRIAR LETTERHEAD] January 13, 2001 LSOF Pooled Equity, L.P. 600 N. Pearl Street, Suite 1550 Dallas, Texas 75201 Attn: J.D. Bell, Vice President Gentlemen: Pursuant to Section 6.3 of the Certificate of Voting Powers, Designations, Preferences, and Relative, Participating, Optional or other Special Rights of Series F Senior Convertible Preferred Stock of Greenbriar Corporation (the "Designation"), the 1,400,000 shares of Series F Senior Convertible Preferred Stock owned by you have been converted into 800,000 shares of common stock, par value $0.01 per share of Greenbriar Corporation, which conversion is based upon a conversion price of $17.50 per share of common stock. A Certificate representing the common shares dated the date hereof is enclosed. Certificates representing the preferred shares have been cancelled on the stock records of Greenbriar Corporation, and the preferred stock certificates will be stamped cancelled. Pursuant to the Agreement dated December 31, 1997, Greenbriar has computed the Make Whole Amount resulting from the conversion to be the sum of $20,615,946. Greenbriar cannot currently make payment of this amount but intends to do so pursuant to the provisions of our letter agreement dated January 31, 2000 and as permitted by Section 78.288 of the Nevada Revised Statutes. Very truly yours, /s/ Gene S. Bertcher Gene S. Bertcher Executive Vice President EX-99 8 0008.txt EXHIBIT 99.18 EXHIBIT 99.18 ------------- [GREENBRIAR LETTERHEAD] January 13, 2001 LSOF Pooled Equity, L.P. 600 N. Pearl Street, Suite 1550 Dallas, Texas 75201 Attn: J.D. Bell, Vice President Gentlemen: Pursuant to Section 6.3 of the Certificate of Voting Powers, Designations, Preferences, and Relative, Participating, Optional or other Special Rights of Series G Senior Convertible Preferred Stock of Greenbriar Corporation (the "Designation"), the 444,854 shares of Series G Senior Convertible Preferred Stock owned by you have been converted into 254,202 shares of common stock, par value $0.01 per share of Greenbriar Corporation, which conversion is based upon a conversion price of $17.50 per share of common stock. A Certificate representing the common shares dated the date hereof is enclosed. Certificates representing the preferred shares have been cancelled on the stock records of Greenbriar Corporation, and the preferred stock certificates will be stamped cancelled. Pursuant to the Agreement dated December 31, 1997, Greenbriar has computed the Make Whole Amount resulting from the conversion to be the sum of $6,550,768. Greenbriar cannot currently make payment of this amount but intends to do so pursuant to the provisions of our letter agreement dated January 31, 2000 and as permitted by Section 78.288 of the Nevada Revised Statutes. Very truly yours, /s/ Gene S. Bertcher Gene S. Bertcher Executive Vice President EX-99 9 0009.txt EXHIBIT 99.19 EXHIBIT 99.19 ------------- LSOF POOLED EQUITY, L.P. 600 NORTH PEARL STREET SUITE 1550 DALLAS, TEXAS 75201 TEL NO.: (214) 754-8300 FAX NO.: (214) 754-8301 January 15, 2001 Greenbriar Corporation 4265 Kellway Circle Addison, Texas 75244 Attention: Gene S. Bertcher Gentlemen: Reference is made to (i) those certain Certificates of Voting Power, Designations, Preferences, and Relative, Participating, Optional or Other Special Rights of Series F Senior Convertible Preferred Stock (the "Series F Stock") and Series G Senior Non-Voting Convertible Preferred Stock (the "Series G Stock" and, with the Series F Stock, the "Preferred Stock") of Greenbriar Corporation ("Greenbriar") (collectively, the "Certificates") and (ii) that certain Stock Purchase Agreement (the "Purchase Agreement") between Greenbriar and Lone Star Opportunity Fund, L.P. ("LSOF"), dated as of December 31, 1997. Capitalized terms used herein and not otherwise defined are used as defined in the Certificates. This letter acknowledges receipt of your correspondence, dated January 13, 2001 (the "Mandatory Conversion Letters"), and stock certificates for an aggregate of 1,054,202 shares (the "Shares") of common stock (the "Common Stock") of Greenbriar. The Shares only partially satisfy Greenbriar's obligation to convert the shares of Series F Stock and Series G Stock owned by LSOF for the following reasons: 1) The correct Conversion Price for the Preferred Stock is $0.69 per share of Common Stock. 2) The correct number of shares of Series G Stock owned by LSOF is 497,697, not 444,854 as stated in the applicable Mandatory Conversion Letter. As previously stated in our original Notice of Conversion, dated October 30, 2000, the number of shares of Series G Stock redeemed on April 14, 2000 was 37,200, not 39,097, as erroneously set forth on the stock power surrendered in connection with such redemption. The supporting documentation for such LSOF Pooled Equity, L.P. January 13, 2001 Page 3 redemption clearly sets forth the correct number of shares redeemed as 37,200, consistent with the calculation methodology for prior redemptions. 3) LSOF has never agreed to your alleged redemption of 50,946 shares of Series G Stock on December 22, 2000. The use of proceeds of the $760,000 received by LSOF from the Company on December 21, 2000 has never been discussed by Greenbriar and LSOF and remains to be addressed in connection with the final resolution of our dispute. LSOF's view is that such proceeds should apply to the Make Whole Amount referred to in the Mandatory Conversion Letters. 4) The Preferred Stock has been accruing penalty dividends (the "Penalty Dividends"), due to certain events of default, since at least June 30, 2000. You have failed to include such penalty dividends in the Liquidation Value for the Preferred Stock to be converted. 5) The unpaid Penalty Dividends have been accruing interest at the rate of 12% per annum. You have failed to include such interest in the Liquidation Value to be converted. 6) LSOF has unreimbursed costs and expenses payable to it pursuant to the Purchase Agreement. You have failed to include such costs and expenses in the Liquidation Value to be converted LSOF POOLED EQUITY, L.P. By: LSOF GenPar, Inc., Its General Partner By: /s/ J.D. Dell ----------------------------------------- J.D. Dell Vice President cc: Mark E. Bennett Ronald L. Brown T. Ray Guy Terrell W. Oxford Michael A. Saslaw -----END PRIVACY-ENHANCED MESSAGE-----