VOTING AND TENDER AGREEMENT
THIS VOTING AND TENDER AGREEMENT (this "Agreement"), dated as of the
1st day of August, 1997, by and between EQUITY-LINKED INVESTORS, L.P.
("Stockholder I"), EQUITY-LINKED INVESTORS-II, L.P. ("Stockholder II")
(Stockholder I and Stockholder II collectively the "Stockholders") and
INTEGRATED HEALTH SERVICES, INC., a Delaware Corporation ("Parent") and IHS
ACQUISITION XXVI, INC. ("Merger Subsidiary").
WHEREAS, Community Care of America, Inc., a Delaware Corporation (the
"Company"), Parent and Merger Subsidiary are entering into an Agreement and Plan
of Merger, dated as of the date hereof (the "Merger Agreement") which provides
for, among other things, an offer to purchase by Merger Subsidiary all of the
outstanding shares of the Company ("Company Common Stock"), at a purchase price
of Four and 0/100 ($4.00) Dollars per share, net to the seller in cash, without
interest thereon, followed by the merger of Merger Subsidiary with the Company
(the "Merger"); and
WHEREAS, as of the date hereof, Stockholder I owns, of record and
beneficially, 665,907 shares of Company Common Stock and Stockholder II owns, of
record and beneficially, 665907 shares of Company Common Stock; and
WHEREAS, as a condition to the willingness of Parent and Merger
Subsidiary to enter into the Merger Agreement, each of Parent and Merger
Subsidiary has required that the Stockholders agree, and in order to induce
Parent and Merger Subsidiary to enter into the Merger Agreement, the
Stockholders have agreed, to enter into this Agreement with respect to (a) all
shares of Company Common Stock now owned, beneficially or otherwise, and which
may hereafter be acquired by the Stockholders (the "Shares") and (b) certain
other matters as set forth herein.
NOW THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
ARTICLE I
Section 1.1 Tender Agreement. (a) The Stockholders shall, within five
(5) business days after the commencement of the Offer (as defined in the Merger
Agreement), tender, or cause to be tendered, for sale to Merger Subsidiary,
pursuant to the terms of the Offer (as long as the Offer is at least $4.00 net
to the Stockholders in cash, without interest thereon), all of the Stockholders'
Shares then owned of record or beneficially by the Stockholder; and (b) except
as provided in clause (a) above, during the time this Agreement is in effect,
the Stockholders shall not otherwise sell, give, dispose of (whether by
operation of law or by agreement or otherwise) or tender any Shares or any
right, title or interest therein or thereto.
Section 1.2 Voting Agreement. The Stockholders hereby agree that during
the time this Agreement is in effect, at any meeting of the stockholders of the
Company, however called, and in any action by consent of the stockholders of the
Company, the Stockholders shall vote the Shares, or cause the Shares to be
voted: (a) in favor of the Merger pursuant to the Merger Agreement; and (b)
against any proposal for any recapitalization, merger, sale of assets or other
business combination between the Company and any person or entity (other than
Merger Subsidiary or Parent) or any other action or agreement that would result
in a breach of any covenant, representation or warranty or any other obligation
or agreement of the Company under the Merger Agreement or which could prevent
any of the conditions to the Company's obligations under the Merger Agreement
from being fulfilled. If requested by Parent, the Stockholders will grant Parent
an irrevocable proxy to vote the Shares in a manner consistent with this Section
1.2 for so long as this Agreement is in effect. The Stockholders will not join
in any suit or proceeding or participate in any action that is inconsistent
with, or designed or intended to have the effect of discouraging, the completion
of the Merger pursuant to the terms of the Merger Agreement; provided, however,
that the Stockholders hereby reserve any and all rights to defend themselves in
any such suit or proceeding or to take any actions required by applicable law.
Section 1.3 General Release. As an inducement for Parent, Merger
Subsidiary and the Company to enter into the Merger Agreement: (a) upon the
Merger Subsidiary obtaining control of the Company, the Stockholders will
remise, release and forever discharge Parent, Merger Subsidiary and the Company,
and their respective officers, directors, shareholders, employees, agents,
successors and assigns, from any and all debts, obligations, suits, actions,
causes of action, claims, demands, in law or in equity, which the Stockholders
ever had or now have, for, upon, or by reason of any matter, cause or thing her
than any obligations under this Agreement or under the Merger Agreement,
including, without limitation, the obligations under Section 7.07 of the Merger
Agreement respecting the continuation of officers and directors indemnity
obligations and insurance after the consummation of the Merger; and (b) upon the
Merger Subsidiary obtaining control of the Company, Parent, Merger Subsidiary
and the Company will remise, release and forever discharge the Stockholders and
their partners, and their respective officers, directors, shareholders,
employees, agents, successors and assigns, from any and all debts, obligations,
suits, actions, claims, demands, in law or in equity, which they ever had or now
have, for, upon, or by reason of any matter, cause or thing whatsoever, however
arising. In the event any action or proceeding covered by the foregoing release
has been filed or instituted, the parties hereto agree to cause its immediate
dismissal with prejudice.
Section 1.4 Stockholder Capacity. The Stockholders make this Agreement
solely in their capacity as the record and beneficial owners of the Shares.
Nothing in this Agreement shall prohibit the Stockholders or any of their
partners, officers, directors, employees, representatives and agents from
taking, or omitting to take, any action as a director, employee, representative
or agent of the Company permitted to be taken or omitted under the Merger
Agreement.
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Section 1.5 Acknowledgment. The Stockholders acknowledge receipt and
review of a copy of the Merger Agreement.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS
The Stockholders hereby represent and warrant to Parent as follows:
Section 2.1 Authority Relative to This Agreement. The Stockholders have
all necessary power and authority to execute and deliver this Agreement, to
perform their obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Stockholders and the consummation by the Stockholders of the transactions
contemplated hereby have been duly and validly authorized by the Stockholders
and no other proceedings on the part of the Stockholders are necessary to
authorize this Agreement or to consummate such transactions. This Agreement has
been duly and validly executed and delivered by the Stockholders and, assuming
the due authorization, execution and delivery by Parent and Merger Subsidiary,
constitutes a legal, valid and binding obligation of the Stockholders,
enforceable against the Stockholders in accordance with its terms, except to the
extent enforceability may be limited by bankruptcy, insolvency, moratorium or
other similar laws affecting creditors' rights generally or by general
principles governing the availability of equitable remedies.
Section 2.2 No Conflict. (a) The execution and delivery of this
Agreement by the Stockholders do not, and the performance of this Agreement by
the Stockholders shall not: (i) conflict with or violate the organizational
documents of the Stockholders; (ii) conflict with or violate any law, rule,
regulation, order, judgment or decree applicable to the Stockholders or by which
the Shares are bound; or (iii) result in any breach of or constitute a default
(or an event that with notice, or lapse of time, or both, would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation of, or result in the creation of a lien or
encumbrance on any of the Shares pursuant to any note, bon franchise or other
instrument or obligation to which either of the Stockholders is a party or by
which either of the Stockholders or the Shares are bound or affected, except in
case of clauses (ii) and (iii), for any such conflicts, violations, breaches,
defaults or other occurrences which would not prevent or delay the performance
by the Stockholders of their obligations under this Agreement; and (b) the
execution and delivery of this Agreement by the Stockholders do not, and the
performance of this Agreement by the Stockholders shall not, require any
consent, approval, authorization or permit of, or filing with, or notification
to, any court or arbitrator or any governmental body, agency or official, except
for applicable requirements, if any of the Securities Exchange Act of 1934, as
amended, and except where the failure to obtain such consents, approvals
authorizations or permits, or to make such filings or notifications, would not
prevent or delay the performance by the Stockholders of their obligations under
this Agreement.
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Section 2.3 Title to the Shares. As of the date hereof, Stockholder I
is the record and beneficial owner of 665,907 shares of Company Common Stock and
Stockholder II is the record and beneficial owner of 665,907 shares of the
Company Common Stock. Such Shares are all the securities of the Company owned,
either of record or beneficially, by the Stockholders and the Stockholders own
no other rights or interests exercisable for or convertible into any securities
of the Company. The Shares are owned free and clear of all security interests,
liens, claims, pledges, options, rights of first refusal, agreements,
limitations on the Stockholders' voting rights, charges and other encumbrances
of any nature whatsoever. Neither of the Stockholders has appointed or granted
any proxy, which appointment or grant is still effective with respect to the
Shares.
Section 2.4 No Fees or Commissions. No broker, financial advisor or
other intermediary is entitled to any fee or other commission in connection with
the transaction contemplated by this Agreement based on an arrangement made by
or on behalf of the Stockholders.
ARTICLE III
COVENANTS OF THE STOCKHOLDERS
Section 3.1 No Inconsistent Agreement. The Stockholders hereby covenant
and agree that, except as contemplated by this Agreement and the Merger
Agreement, the Stockholders shall not enter into any agreement or grant a proxy
or power of attorney with respect to the Shares which is inconsistent with this
Agreement.
Section 3.2 No Encumbrances. The Stockholders hereby covenant and agree
that the Stockholders shall not by any action or omission cause any security
interests, liens, claims, pledges, charges, encumbrances, options, rights of
first refusals, agreements or limitations on the Stockholders' voting rights, to
attach to the Shares to be tendered to the Merger Subsidiary pursuant to Section
1.1 hereof.
ARTICLE IV
REPRESENTATIONS, WARRANTIES AND COVENANTS
OF PARENT AND MERGER SUBSIDIARY
Section 4.1 Authority. Parent and Merger Subsidiary each have full
right, power and authority to enter into and perform this Agreement and this
Agreement has been duly authorized, executed and delivered by Parent and Merger
Subsidiary and is a valid and binding agreement of Parent and Merger Subsidiary
enforceable against Parent and Merger Subsidiary in accordance with its terms.
Section 4.2 Offer Price. Parent and Merger Subsidiary each hereby
confirms to the Stockholders that it has not, in connection with the Merger,
purchased, and each agrees with the Stockholders that it hereafter will not buy,
any shares of stock of the
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Company for a price higher than the price to be received by the Stockholders in
the Offer.
ARTICLE V
MISCELLANEOUS
Section 5.1 Termination. It is a condition precedent to the
effectiveness of this Agreement that the Merger Agreement shall have been duly
executed and delivered and shall be in full force and effect. This Agreement
shall automatically terminate: (i) upon the termination of the Merger Agreement;
or (ii) if the Shares shall have not theretofore been sold pursuant to the
Offer, on November 30, 1997; or (iii) if the price contained in the Offer is
reduced below a price of $4.00 per share net in cash, without interest thereon;
or (iv) if the Board of Directors of the Company changes its recommendation to
its stockholders in respect of the Merger, whichever of the four is the earlier
to occur.
Section 5.2 Specific Performance. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with the terms hereof and that the
parties shall be entitled to specific performance of the terms hereof, in
addition to any other remedy at law or in equity.
Section 5.3 Entire Agreement. This Agreement constitutes the entire
agreement among Parent, Merger Subsidiary and the Stockholders with respect to
the subject matter hereof and supersedes all prior agreements and
understandings, both written and oral, among Parent, Merger Subsidiary and the
Stockholders with respect to the subject matter hereof.
Section 5.4 Amendment. This Agreement may not be amended, except by an
instrument in writing signed by the parties hereto.
Section 5.5 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
regardless remain in full force and effect so long as the economic or legal
substance of this Agreement is not affected in any manner materially adverse to
any party. Upon such determination that any term orties hereby shall negotiate
in good faith to modify this Agreement so as to effect the original intent of
the parties as closely as possible to the fullest extent permitted by applicable
law in a mutually acceptable manner in order that the terms of this Agreement
remain as originally contemplated.
Section 5.6 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware regardless of the
laws that might otherwise govern under applicable principles of conflicts of
law.
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Section 5.7 Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
IN WITNESS WHEREOF, the Stockholders, Parent and Merger Subsidiary have
caused this Agreement to be duly executed as the date and year first above
written.
EQUITY-LINKED INVESTORS, L.P.
BY: Xxxxx X. Xxxxx Associates,
--------------------------
General Partner
By: /s/
----------------------------
Name:
Title:
EQUITY-LINKED INVESTORS-II, L.P.
BY: Xxxxx X. Xxxxx Associates-II,
General Partner
By: /s/
----------------------------
Name:
Title:
INTEGRATED HEALTH SERVICES, INC.
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Executive Vice President -
Development
IHS ACQUISITION XXVI, INC.
By: /s/ Xxxxx X. Xxxxxxxx
----------------------------
Name: Xxxxx X. Xxxxxxxx
Title: Executive Vice President -
Development
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