Exhibit 99.1
VOTING AND LOCKUP AGREEMENT
VOTING AND LOCKUP AGREEMENT, dated as of October 17,
2001 (this "Agreement"), by and between WellPoint Health Networks
Inc., a Delaware corporation ("Purchaser"), and The Missouri
Foundation For Health, a Missouri non-profit public benefit
corporation ("Stockholder"), a stockholder of RightCHOICE Managed
Care, Inc., a Delaware corporation ("Target").
RECITALS
A. Concurrently with the execution of this Agreement,
Purchaser and Target are entering into an Agreement and Plan of
Merger (the "Merger Agreement"), pursuant to which Purchaser and
Target will effect a business combination, upon the terms and
subject to the conditions set forth in the Merger Agreement (the
"Merger"). Unless otherwise indicated, capitalized terms not
defined herein have the meanings given to them in the Merger
Agreement.
B. Stockholder is a stockholder of Target and, with
respect to the Merger, has the power to vote or to direct the
voting of 11,112,500 shares of the common stock, par value $0.01
per share, of Target (collectively, the "Shares").
C. As a material inducement to enter into the Merger
Agreement and to consummate the Merger, Purchaser desires
Stockholder to agree, and Stockholder is willing to agree
(i) subject to the terms of this Agreement, to vote the Shares
and any other such shares of capital stock of Target acquired and
beneficially owned by Stockholder so as to facilitate
consummation of the Merger and (ii) to comply in all respects
with all of the terms of this Agreement.
NOW, THEREFORE, intending to be legally bound, the
parties agree as follows:
1. Voting of Shares.
Section 1.1 Voting Agreement. (a) At every meeting of the
stockholders of Target called with respect to any of the following, and
at every adjournment or postponement thereof, and on every action or
approval by written consent of the stockholders of Target with
respect to any of the following, Stockholder shall vote or cause
to be voted the Shares and any New Shares (as hereinafter
defined) in favor of adoption and approval of the Merger
Agreement and the terms thereof and each of the other
transactions contemplated thereby.
(b) Stockholder shall not, from the date of this Agreement
until the Expiration Date (as hereinafter defined), enter into
any agreement or understanding with any Person to vote or give
instructions inconsistent with Section 1.1(a) hereof. Without
limiting the generality of the foregoing, at any meeting of
Target stockholders or at any adjournment thereof or in any other
circumstances upon which their vote, consent or other approval is
sought, Stockholder shall vote (or cause to be voted) all of the
Shares and any New Shares against (i) the approval of any
Acquisition Proposal or (ii) any amendment of Target's
Certificate of Incorporation or Bylaws or other proposal or
transaction involving Target or any of its subsidiaries which
amendment or other proposal or transaction would in any manner
impede, frustrate, prevent or nullify the Merger, the Merger
Agreement or any of the other transactions contemplated by the
Merger Agreement.
Section 1.2 New Shares. Stockholder agrees that any shares of
capital stock of Target that Stockholder purchases or with respect to which
Stockholder otherwise acquires beneficial ownership ("New
Shares") after the execution of this Agreement and prior to the
Expiration Date shall be subject to the terms and conditions of
this Agreement to the same extent as if they constituted Shares.
Section 1.3 Waiver of Appraisal Rights. Stockholder hereby
irrevocably and unconditionally waives any rights of appraisal, dissenters'
rights or similar rights that Stockholder may have in connection with
the Merger.
2. Transfer Restrictions and Obligations.
Section 2.1 Lock-Up. After the execution of this Agreement until the
Expiration Date, Stockholder will not:
(a) offer, pledge, sell, contract to sell, sell any option
or contract to purchase, purchase any option or
contract to sell, grant any option, right or warrant to
purchase or otherwise transfer or dispose of, directly
or indirectly, any of the Shares or any securities
convertible into or exercisable or exchangeable for
Shares or file any registration statement under the
Securities Act of 1933, as amended, with respect to any
of the foregoing;
(b) enter into swap or any other agreement or any
transaction that transfers, in whole or in part,
directly or indirectly, the economic consequence of
ownership of Shares; or
(c) create or permit to exist any liens, claims, options,
charges or other encumbrances on or otherwise
affecting any of the Shares.
Section 2.2 Voting Trust Agreement. Stockholder covenants and
agrees to enter into a Voting Trust Agreement with Purchaser and a qualified
trustee providing for the deposit with the voting trustee of the number
of shares of the Purchaser then owned by Stockholder which are in
excess of the Ownership Limit (as defined in Purchaser's
Certificate of Incorporation). The Voting Trust Agreement shall
contain limitations only to the extent required by the Blue Cross
Blue Shield Association. The Voting Trust Agreement, when
executed by the Purchaser, Stockholder and such trustee, shall
replace and supercede the Voting Trust and Divestiture Agreement
dated as of November 30, 2000 between Target, Stockholder and the
trustee thereunder.
3. Representations and Warranties of the Stockholder.
Section 3.1 Ownership of Shares. Stockholder represents and warrants
that Stockholder (i) is the record and beneficial owner of and has the sole
right to vote or direct the voting of the Shares with respect to the
adoption and approval of the Merger Agreement and the terms
thereof, which Shares at the date hereof are free and clear of
any liens, claims, options, charges or other encumbrances and
(ii) does not own, either beneficially or of record, any shares
of capital stock of Target other than the Shares.
Section 3.2 No Conflict. The execution and delivery of this Agreement
by Stockholder do not, and the performance of this Agreement by
Stockholder will not: (i) conflict with or violate any legal
requirement, order, decree or judgment applicable to Stockholder
or by which Stockholder or any of Stockholder's properties is
bound or affected; or (ii) result in any breach of or constitute
a default (with notice or lapse of time, or both) under, or give
to others any rights of termination, amendment, acceleration or
cancellation of, or result in the creation of an encumbrance on
or otherwise affecting any of the Shares pursuant to, any
contract to which Stockholder is a party or by which Stockholder
or any of Stockholder's properties is bound or affected. The
execution and delivery of this Agreement by Stockholder do not,
and the performance of its obligations under this Agreement by
Stockholder will not, require any consent of any person. To the
extent required, the approval of the Attorney General of the
State of Missouri has been received prior to or contemporaneously
with the execution hereof.
Section 3.3 Enforceability. Stockholder has all requisite power and
capacity to execute and deliver this Agreement and to perform its obligations
hereunder. This Agreement has been duly executed and delivered
by Stockholder and, assuming the due authorization, execution and
delivery of this Agreement by Purchaser, constitutes the legal,
valid and binding obligations of Stockholder, enforceable against
Stockholder in accordance with its terms, subject to (i) laws of
general application relating to bankruptcy, insolvency and the
relief of debtors and (ii) rules of law governing specific
performance, injunctive relief and other equitable remedies.
Section 3.4 Consent and Waiver. No consents or waivers are
reasonably required for the consummation of the Merger under the terms of
(a) any agreements between Stockholder (or any of its Affiliates) and
Target, or any Target Subsidiary or (b) other rights that
Stockholder may have.
Section 3.5 Continuous Warranty. The representations and warranties
contained in this Agreement are accurate in all respects as of the date of this
Agreement, will be accurate in all material respects at all times
through the Expiration Date and will be accurate in all material
respects as of the date of the consummation of the Mergers as if
made on that date.
4. Representations and Warranties of Purchaser.
Section 4.1 Enforceability. Purchaser has all requisite
power and capacity to execute and deliver this Agreement and to
perform its obligations hereunder. This Agreement has been duly
executed and delivered by Purchaser and, assuming the due
authorization, execution and delivery of this Agreement by
Stockholder, constitutes the legal, valid and binding obligations
of Purchaser, enforceable against Purchaser in accordance with
its terms, subject to (i) laws of general application relating to
bankruptcy, insolvency and the relief of debtors and (ii) rules
of law governing specific performance, injunctive relief and
other equitable remedies.
5. Covenants of Stockholder. Stockholder hereby covenants and agrees to
cooperate fully with Purchaser and to execute and deliver any additional
documents necessary or desirable and to take such further
actions, in the reasonable opinion of Purchaser, necessary or
desirable to carry out the intent of this Agreement.
6. Termination. This Agreement shall terminate upon and shall have
no further force or effect after the earliest to occur of (a) the
termination of the Merger Agreement, (b) the Effective Time or
(c) the Merger Agreement is amended in any manner materially
adverse to the Stockholder without the consent of the Stockholder
(such earliest to occur shall be the "Expiration Date"). In
addition, Stockholder shall not be obligated to vote the Shares
in accordance with Section 1 hereof, and this Agreement shall
terminate, if, at the time of the meeting of stockholders of the
Target, there shall have occurred or exist any change,
circumstance or event that, individually or in the aggregate, has
had or would reasonably be expected to have a Material Adverse
Effect on Purchaser.
7. Controlling Person Liability. Purchaser hereby agrees to
indemnify Stockholder, and its directors, officers and employees
("Indemnified Persons") against any and all losses, claims,
damages or liabilities, joint or several, actions or proceedings
(whether commenced or threatened) in respect thereof ("Claims")
and expenses (including reasonable attorneys fees and reasonable
expenses of investigation) to which such Indemnified Person may
become subject under the Securities Act of 1933, as amended, the
Securities Exchange Act of 1934, as amended, common law or
otherwise, arising out of the Form S-4 or the proxy
statement/prospectus contained therein; provided that Purchaser
shall not be liable to any Indemnified Person to the extent such
Claim or expense arises out of, or is based upon information
furnished by such Indemnified Person or the Stockholder in
writing for use in the Form S-4 or proxy statement/prospectus.
8. Miscellaneous.
Section 8.1 Fees and Expenses. All costs and expenses incurred in
connection with this Agreement shall be paid by the party incurring such
expenses.
Section 8.2 Amendments and Modification. Subject to applicable law,
this Agreement may not be amended, modified, or supplemented except upon the
execution and delivery of a written agreement executed by the parties hereto.
Section 8.3 Nonsurvival of Representations and Warranties. None of
the representations and warranties in this Agreement or in any schedule,
instrument or other document delivered pursuant to this Agreement shall
survive the Expiration Date; provided, however that the termination of this
Agreement shall not relieve any party from any liability for any breach of
this Agreement.
Section 8.4 Notices. All notices and other communications hereunder
shall be in writing and shall be deemed given if delivered personally,
telecopied (which is confirmed) or sent by an internationally
recognized overnight courier service, such as Federal Express, to
the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
if to Purchaser, to:
WellPoint Health Networks, Inc.
0 XxxxXxxxx Xxx
Xxxxxxxx Xxxx, XX 00000
Attn: General Counsel
Telecopy No.: (000) 000-0000
with a copy (which shall not constitute
notice) to:
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000-0000
Attn: Xxxx X. Xxxxxxxx
Telecopy No.: (000) 000-0000
And
if to Stockholder, to:
The Missouri Foundation For Health
000 X. Xxxxxxxx, 00xx Xx.
Xx. Xxxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Telecopy No.: (000) 000-0000
with a copy (which shall not
constitute notice) to:
Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xx. Xxxxx, XX 00000
Attn: Xxxx X. Short
Telecopy No: (000) 000-0000
Section 8.5 Counterparts. This Agreement may be executed in one or
more counterparts (whether delivered by facsimile or otherwise), each
of which shall be considered one and the same agreement.
Section 8.6 Entire Agreement. This Agreement and the documents and
the instruments referred to herein constitute the entire agreement and
supersede all prior agreements, negotiations, arrangements and
understandings, both written and oral, among the parties with
respect to the subject matter hereof.
Section 8.7 Severability. Any term or provision of this Agreement
that is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable in any situation in any
jurisdiction shall not affect the validity or enforceability of
the remaining terms and provisions hereof or the validity or
enforceability of the invalid, void or unenforceable term or
provision in any other situation or in any other jurisdiction.
If the final judgment of a court of competent jurisdiction or
other authority declares that any term or provision hereof is
invalid, void or unenforceable, the parties agree that the court
making such determination shall have the power to and shall,
subject to the discretion of such court, reduce the scope,
duration, area or applicability of the term or provision, to
delete specific words or phrases, or to replace any invalid, void
or unenforceable term or provision with a term or provision that
is valid and enforceable and that comes closest to expressing the
intention of the invalid or unenforceable term or provision.
Section 8.8 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware.
Section 8.9 Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement
were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the
parties shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any court of the
United States sitting in the Borough of Manhattan, The City of
New York, this being in addition to any other remedy to which
they are entitled at law or in equity. In addition, each of the
parties (a) consents to submit itself to the personal
jurisdiction of any Federal court sitting in the Borough of
Manhattan, The City of New York in the event any dispute arises
out of this Agreement or any of the Transactions and (b) agrees
that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such
court. PURCHASER AND STOCKHOLDER EACH IRREVOCABLY AND
UNCONDITIONALLY WAIVE ANY RIGHT THEY MAY HAVE TO TRIAL BY JURY IN
CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
Section 8.10 Extension, Waiver. At any time prior to the Expiration
Date, the parties to this Agreement may (a) extend the time for the
performance of any of the obligations or other acts of the other
parties to this Agreement, (b) waive any inaccuracies in the
representations and warranties of the other parties contained in
this Agreement or in any document delivered pursuant to this
Agreement or (c) waive compliance by the other parties with any
of the agreements or conditions contained in this Agreement. Any
agreement on the part of a party to any such extension or waiver
shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this
Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of those rights.
Section 8.11 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of
the parties to this Agreement (whether by operation of law or
otherwise) without the prior written consent of the other parties
to this Agreement. Subject to the preceding sentence, this
Agreement will be binding upon, inure to the benefit of and be
enforceable by the parties and their respective successors and
assigns. Without limiting any of the restrictions set forth in
Section 2 or elsewhere in this Agreement, this Agreement shall be
binding upon any person to whom any Shares are transferred.
Section 8.12 Legal Counsel. Stockholder acknowledges that it has
been advised to, and has had the opportunity to, consult with its attorney
prior to entering into this Agreement. Stockholder acknowledges
that attorneys for Target represent Target and do not represent
any of the stockholders of Target in connection with the Merger
Agreement, this Agreement or any of the transactions contemplated
hereby or thereby.
Section 8.13 Agreement Negotiated. The form of this Agreement has
been negotiated by or on behalf of Purchaser and Stockholder, each of which was
represented by attorneys who have carefully negotiated the
provisions hereof. No law or rule relating to the construction
or interpretation of contracts against the drafter of any
particular clause should be applied with respect to this
Agreement.
Section 8.14 Effect of Headings. The Section headings herein are for
convenience only and shall not affect the construction or interpretation of
this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement
to be duly executed on the date and year first above written.
WELLPOINT HEALTH NETWORKS INC.
By: /s/ Xxxxxx X. Xxxxxx
Name: Xxxxxx X. Xxxxxx
Title: Secretary
THE MISSOURI FOUNDATION FOR HEALTH
By: /s/ Xxxxxxx X. Xxxxxx
Name: Xxxxxxx X. Xxxxxx
Title: Chairperson
