Exhibit 10.1
VOTING AGREEMENT
THIS VOTING AGREEMENT (the "Agreement") dated as of October 24, 2000 is by
and between Career Education Corporation, a Delaware corporation (the
"Acquiror"), and the other parties signatory hereto (each a "Shareholder").
RECITALS
Acquiror, EI Acquisition, Inc., a Delaware limited liability company and a
direct wholly-owned subsidiary of Acquiror ("Acquisition Sub"), and EduTrek
International, Inc., a Georgia corporation (the "Company"), are negotiating an
Agreement and Plan of Merger (as such agreement may be executed and amended
from time to time, the "Merger Agreement"; capitalized terms used but not
defined herein shall have the meanings set forth in the Merger Agreement), a
draft of which has been circulated to the parties, pursuant to which (and
subject to the terms and conditions specified therein) the Acquisition Sub will
be merged with and into the Company (the "Merger"), whereby each share of class
A common stock, no par value, of the Company and each share of class B common
stock, no par value, of the Company (collectively, the "Company Common Stock")
issued and outstanding immediately prior to the Effective Time will be
converted into the right to receive the Merger Consideration, other than (i)
shares of Company Common Stock owned, directly or indirectly, by the Company or
any subsidiary of the Company or by Acquiror and (ii) Dissenting Shares.
As a condition to Acquiror's negotiating and entering into the Merger
Agreement, Acquiror requires that each Shareholder enter into, and each such
Shareholder has agreed to enter into, this Agreement with Acquiror.
AGREEMENT
To implement the foregoing and in consideration of the mutual agreements
contained herein, the parties hereby agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS. Each Shareholder
hereby severally and not jointly represents and warrants to Acquiror as
follows:
(a) OWNERSHIP OF SHARES. (i) Such Shareholder is either (a) the
record holder or beneficial owner, either alone or with such
Shareholder's spouse, of the number of or (b) trustee of a trust that
is the record holder or beneficial owner of, and whose beneficiaries
are the beneficial owners (such trustee, a "Trustee") of shares of
Company Common Stock as is set forth opposite such Shareholder's name
on Schedule 1(a) hereto (such shares shall constitute the "Existing
Shares", and together with any shares of Company Common Stock acquired
of record or beneficially by such Shareholder in any capacity after the
date hereof and prior to the termination hereof, whether upon exercise
of options, conversion of convertible securities, purchase, exchange or
otherwise, shall constitute the "Shares").
(i) On the date hereof, the Existing Shares set forth opposite
such Shareholder's name on Schedule 1(a) hereto constitute all of
the outstanding shares of Company Common Stock owned of record or
beneficially by such Shareholder. Such Shareholder does not have
record or beneficial ownership of any Shares not set forth on
Schedule 1(a) hereto.
(ii) Such Shareholder has sole power of disposition with respect
to all of the Existing Shares set forth opposite such Shareholder's
name on Schedule 1(a) and sole power to demand dissenter's or
appraisal rights, in each case with respect to all of the Existing
Shares set forth opposite such Shareholder's name on Schedule 1(a),
with no restrictions on such rights, subject to applicable federal
securities laws and the terms of this Agreement.
(b) POWER; BINDING AGREEMENT. Such Shareholder has the legal
capacity, power and authority to enter into and perform all of such
Shareholder's obligations under this Agreement. The execution, delivery
and performance of this Agreement by such Shareholder will not violate
any other agreement to which such Shareholder is a party or by which
such Shareholder is bound including, without limitation, any trust
agreement, voting agreement, shareholders agreement, voting trust,
partnership or other agreement. This Agreement has been duly and
validly executed and delivered by such Shareholder and constitutes a
valid and binding agreement of such Shareholder, enforceable against
such Shareholder in accordance with its terms, except as the
enforcement thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar laws generally
affecting the rights of creditors and subject to general equity
principles and by any implied covenant of good faith and fair dealing.
There is no beneficiary of or holder of interest in any trust of which
a Shareholder is Trustee whose consent is required for the execution
and delivery of this Agreement or the consummation of the transactions
contemplated hereby. If such Shareholder is married and such
Shareholder's Shares constitute community property, this Agreement has
been duly authorized, executed and delivered by, and constitutes a
valid and binding agreement of, such Shareholder's spouse, enforceable
against such person in accordance with its terms.
(c) NO CONFLICTS. Except for filings under the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended (the "HSR Act"), if
applicable, and the expiration or termination of any applicable waiting
period thereunder, (A) no filing with, and no permit, authorization,
consent or approval of, any state or federal public body or authority
is necessary for the execution of this Agreement by such Shareholder
and the consummation by such Shareholder of the transactions
contemplated hereby and (B) neither the execution and delivery of this
Agreement by such Shareholder nor the consummation by such Shareholder
of the transactions contemplated hereby nor compliance by such
Shareholder with any of the provisions hereof shall (x) conflict with
or result in any breach of any applicable trust, partnership agreement
or other agreements or organizational documents applicable to such
Shareholder, (y) result in a violation or breach of, or constitute
(with or without notice or lapse of time or both) a default (or give
rise to any third party right of termination, cancellation, material
modification or acceleration) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, license, contract,
commitment, arrangement, understanding, agreement or other instrument
or obligation of any kind to which such Shareholder is a party or by
which such Shareholder or any of such Shareholder's properties or
assets may be bound or (z) violate any order, writ, injunction, decree,
judgment, statute, rule or regulation applicable to such Shareholder or
any of such Shareholder's properties or assets.
(d) LIENS. Such Shareholder's Shares and the certificates
representing such Shares are now and at all times during the term
hereof will be held by such Shareholder, or by a nominee or custodian
for the benefit of such Shareholder, free and clear of all liens,
claims, security interests, proxies, voting trusts or agreements,
understandings or arrangements or any other encumbrances whatsoever,
except for any such encumbrances or proxies arising hereunder or listed
on Schedule 1(d).
(e) BROKERS. No broker, investment banker, financial adviser or
other person is entitled to any broker's, finder's, financial adviser's
or other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangements made by or on behalf of
such Shareholder in his or her capacity as such.
(f) ACKNOWLEDGMENT. Such Shareholder understands and acknowledges
that Acquiror is entering into the Merger Agreement in reliance upon
such Shareholder's execution and delivery of this Agreement with
Acquiror.
2. CERTAIN COVENANTS OF SHAREHOLDERS. Except in accordance with the
terms of this Agreement, each Shareholder hereby severally covenants and
agrees as follows:
(a) NO SOLICITATION. Prior to the termination of the Merger
Agreement in accordance with its terms, no Shareholder shall, in its
capacity as such, directly or indirectly (including through advisors,
agents or other intermediaries), solicit (including by way of
furnishing information) or respond to any inquiries or the making of
any proposal by any person or entity (other than Acquiror, Acquisition
Sub or any affiliate thereof) with respect to the Company that
constitutes or could be expected to lead to an Acquisition Proposal (as
defined in the Merger Agreement). If any Shareholder in its capacity as
such receives any such inquiry or proposal, then such Shareholder shall
promptly inform Acquiror in writing of the terms and conditions, if
any, of such inquiry or proposal and the identity of the person making
it. Each Shareholder, in its capacity as such, will immediately cease
and cause to be terminated any existing activities, discussions or
negotiations with any parties conducted heretofore with respect to any
of the foregoing.
(b) RESTRICTION ON TRANSFER, PROXIES AND NONINTERFERENCE;
RESTRICTION ON WITHDRAWAL. Prior to the termination of the Merger
Agreement in accordance with its terms, no Shareholder shall, directly
or indirectly: (i) except pursuant to the terms of the Merger Agreement
and to Acquiror pursuant to this Agreement, offer for sale, sell,
transfer, tender, pledge, encumber, assign or otherwise dispose of,
enforce or permit the execution of the provisions of any redemption
agreement with the Company or enter into any contract, option or other
arrangement or understanding with respect to or consent to the offer
for sale, sale, transfer, tender, pledge, encumbrance, assignment or
other disposition of, or exercise any discretionary powers to
distribute, any or all of such Shareholder's Shares or any interest
therein, including any trust income or principal, except in each case
to a Permitted Transferee who is or agrees in a writing executed by the
Acquiror to become bound by this Agreement; (ii) grant any proxies or
powers of attorney with respect to any Shares, deposit any Shares into
a voting trust or enter into a voting agreement with respect to any
Shares; or (iii) take any action that would make any representation or
warranty of such Shareholder contained herein untrue or incorrect or
have the effect of preventing or disabling such Shareholder from
performing such Shareholder's obligations under this Agreement. For
purposes of the Agreement, "Permitted Transferees" means, with respect
to a Shareholder, any of the following persons: (a) the spouse of such
Shareholder, provided that at all relevant times of determination such
Shareholder is not separated or divorced from, or is not involved in
separation or divorce proceedings with, such spouse; (b) the issue of
such Shareholder; (c) a trust of which there are no principal
beneficiaries other than (i) such Shareholder, (ii) such Shareholder's
spouse (provided that at all relevant times of determination such
Shareholder is not separated or divorced from, or is not involved in
separation or divorce proceedings with, such spouse), or (iii) the
issue of such Shareholder; (d) the legal representative of such
Shareholder in the event such Shareholder becomes mentally incompetent;
and (e) the beneficiaries under (i) the will of such Shareholder or the
will of such Shareholder's spouse, or (ii) a trust described in clause
(c) above.
(c) WAIVER OF APPRAISAL AND DISSENTER'S RIGHTS. Each Shareholder
hereby waives any rights of appraisal or rights to dissent from the
Merger that such Shareholder may have. Each Trustee represents that no
beneficiary who is a beneficial owner of Shares under any trust has any
right of appraisal or right to dissent from the Merger which has not
been so waived.
(d) NO TERMINATION OR CLOSURE OF TRUSTS. Unless, in connection
therewith, the Shares held by any trust which are presently subject to
the terms of this Agreement are transferred upon termination to one or
more Shareholders and remain subject in all respects to the terms of
this Agreement, or other Permitted Transferees who upon receipt of such
Shares become signatories to this Agreement, the Shareholders who are
Trustees shall not take any action to terminate, close or liquidate any
such trust and shall take all steps necessary to maintain the existence
thereof at least until the termination of the Merger Agreement in
accordance with its terms.
(e) VOTING OF COMPANY STOCK. Each Shareholder hereby agrees that,
prior to the termination of the Merger Agreement in accordance with its
terms, at any meeting (whether annual or special and whether or not an
adjourned or postponed meeting) of the holders of Company Common Stock,
however called, or in connection with any written consent of the
holders of the Company Common Stock, he will appear at the meeting or
otherwise cause the Shares to be counted as present thereat for
purposes of establishing a quorum and vote or consent (or cause to be
voted or consented) the Shares, except as otherwise agreed to in
writing in advance by the Acquiror in its sole discretion, in favor of
any business combination with Acquiror and against the following
actions: (a) any Acquisition Proposal (as defined in the Merger
Agreement) or (b) any other action which is intended, or could
reasonably be expected, to impede, interfere with, delay, postpone or
materially adversely affect the transactions contemplated by this
Agreement or the Merger Agreement. Each Shareholder agrees that he will
not enter into any agreement or understanding with any Person the
intended or reasonably anticipated effect of which would be
inconsistent with or violative of any provision contained in this
Section 3(e).
(f) GRANT OF PROXY; APPOINTMENT OF PROXY. Each Shareholder hereby
revokes any and all previous proxies granted with respect to the
Shares. Prior to the termination of the Merger Agreement in accordance
with its terms, each Shareholder hereby irrevocably grants to, and
appoints, Acquiror, or any nominee of Acquiror, such Shareholder's
proxy and attorney-in-fact (with full power of substitution), for and
in the name, place and stead of such Shareholder, to (1) exercise any
rights as a shareholder of the Company, including but not limited to
those in connection with calling a special meeting and all matters
ancillary there to of shareholders to vote on the Merger or (2) vote
the Existing Shares at every annual, special, or adjourned meeting or
grant a consent or approval in respect of the Shares in favor of any
business combination proposed by Acquiror, and against the following
actions (a) any Acquisition Proposal (as defined in the Merger
Agreement) or (b) any other action which is intended, or could
reasonably be expected, to impede, interfere with, delay, postpone or
materially adversely affect the transactions contemplated by this
Agreement or the Merger Agreement. Each Shareholder shall have no claim
against such proxy and attorney-in-fact, for any action taken, decision
made or instruction given by such proxy and attorney-in-fact on
accordance with this Agreement or the Merger Agreement. Such proxy is
irrevocable and the appointment is coupled with an interest in the
Shares.
3. GENERAL RELEASE.
(a) In consideration of the Acquiror's consummation of the Merger in
accordance with the terms and conditions of the Merger Agreement, and
for other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the Shareholder, for himself, herself
or itself and each of his, her or its heirs, executors, successors, and
assigns (collectively, the "Releasors"), hereby forever releases the
Buyer, Acquisition Sub, the Company and each of their respective
predecessors, successors, and past and present shareholders or
unitholders, directors, officers, employees, agents, and
representatives (collectively, the "General Released Parties") from any
and all claims, demands and causes of action of every kind and nature
whether arising from his, her or its purchase of stock of the Company
(pursuant to that certain Subscription Agreement, dated as of September
8, 2000, or otherwise) his or her employment by the Company or
otherwise (including, without limitation, claims for damages, costs,
expenses and attorneys', brokers' and accountants' fees and expenses),
whether known or unknown, suspected or unsuspected, that the Releasors
now have or at any time prior to the date of this General Release may
have had or could have asserted against any of the General Released
Parties (collectively, the "General Released Claims"). Notwithstanding
anything to the contrary in this General Release, Releasors are not
releasing any of their rights under this Agreement, the Merger
Agreement or any agreement executed in connection with the Merger
Agreement or any of their rights to indemnification from the Company
that exist as of the date hereof with respect to their actions as
officers or directors of the Company.
(b) The Releasors hereby irrevocably agree to refrain from directly
or indirectly asserting any claim or demand or commencing (or causing
to be commenced) any suit, action, or proceeding of any kind, in any
court or before any tribunal, against any General Released Party based
upon any General Released Claim.
(c) The Shareholder has read and understands this General Release,
has had the opportunity to consult with an attorney prior to signing
it, and voluntarily enters into it with full knowledge of its terms and
conditions and that such terms and conditions are binding on him, her
or its.
(d) This Section 3 will be effective upon the effective time of the
Merger in the Merger Agreement.
4. RESIGNATION. Each Shareholder hereby resigns, effective upon the
effective time of the Merger, from all such Shareholder's positions with
the Company including, without limitation, positions on the board of
Directors of the Company and the Governing Board of the Company and all
positions as an officer or employee of the Company.
5. FURTHER ASSURANCES. From time to time, at the other party's request
and without further consideration, each party hereto shall execute and
deliver such additional documents and take all such further action as may
be necessary to consummate and make effective the transactions contemplated
by this Agreement.
6. CERTAIN EVENTS. Each Shareholder agrees that this Agreement and the
obligations hereunder shall attach to such Shareholder's Shares and shall
be binding upon any person or entity to which legal or beneficial ownership
of such Shares shall pass, whether by operation of law or otherwise,
including without limitation such Shareholder's heirs, guardians,
administrators or successors or as a result of any divorce.
7. STOP TRANSFER. Each Shareholder agrees with, and covenants to,
Acquiror that such Shareholder shall not request that the Company register
the transfer (book-entry or otherwise) of any certificate or uncertificated
interest representing any of such Shareholder's Shares, unless such
transfer is made in compliance with this Agreement.
8. TERMINATION. The obligations set forth in this Agreement, other than
those set forth in Sections 2, 3, 8 and 9, will terminate upon termination
of the Merger Agreement in accordance with its terms. The obligations set
forth in Section 2 will terminate on the earlier of (i) termination of the
Merger Agreement pursuant to Section 8.1(d) therefore and (ii) May 21,
2001.
9. MISCELLANEOUS.
(a) ENTIRE AGREEMENT; ASSIGNMENT. This Agreement, together with the
Merger Agreement (and the Exhibits and Schedule thereto) (i) constitute
the entire agreement between the parties with respect to the subject
matter hereof and supersedes all other prior agreements and
understandings, both written and oral, between the parties with respect
to the subject matter hereof and (ii) shall not be assigned by
operation of law or otherwise without the prior written consent of the
other party.
(b) AMENDMENTS. This Agreement may not be modified, amended, altered
or supplemented, except upon the execution and delivery of a written
agreement executed by the parties hereto; provided that Schedule 1(a)
may be supplemented by Acquiror by adding the name and other relevant
information concerning any Shareholder of the Company who is or agrees
to be bound by the terms of this Agreement without the agreement of any
other party hereto, and thereafter such added Shareholder shall be
treated as a "Shareholder" for all purposes of this Agreement.
(c) NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed to have been duly given; as of the date
of delivery, if delivered personally; upon receipt of confirmation, if
telecopied or upon the next business day when delivered during normal
business
hours to an overnight courier service, such as Federal Express, in each
case to the parties at the following addresses or at such other
addresses as shall be specified by the parties by like notice; unless
the sending party has knowledge that such notice or other communication
hereunder was not received by the intended recipient:
If to Xxxxx Xxxxxx, Xxxxxx Family Limited Partnership
or The Xxxxxx Family Foundation, Inc., to:
00 Xxxxxxxxxx Xxxxxx, #0000
Xxxxxxx, Xxxxxxx 00000
with a copy to:
Xxxxx, Xxxxxxxx & Xxxxxxx, XXX
Xxxxxxxxx XX, Xxxxx 0000
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000-0000
Attn: A. Xxx Xxxxxxxx, Esq.
Fax: (000) 000-0000
If to Xxxxx Xxxxxx, to :
000 Xxxxxxxxxx Xxxxx
Xxxxxxx, Xxxxxxx 00000
with a copy to:
_____________________________________
_____________________________________
_____________________________________
_____________________________________
If to Acquiror:
Career Education Corporation
0000 Xxxxxxxxxxx Xxxxxxx
Xxxxx 000
Xxxxxxx Xxxxxxx, Xxxxxxxx 00000
Attn: Chief Financial Officer
Fax: (000) 000-0000
with a copy to:
Xxxxxx Xxxxxx Zavis
000 Xxxx Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000-0000
Attn: Xxxxx X. Xxxxxxx
Fax: 312/000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth
above.
(d) GOVERNING LAW. The validity, interpretation and effect of this
Agreement shall be governed exclusively by the laws of the State of
Georgia, without giving effect to the principles of conflict of laws
thereof.
(e) COSTS. The parties will each be solely responsible for and bear
all of its own respective expenses, including, without limitation,
expenses of legal counsel, accountants, and other advisors, incurred at
any time in connection with pursuing or consummating the Agreement and
the transactions contemplated thereby.
(f) 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.
(g) COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed to be an original, but both
of which shall constitute one and the same Agreement.
(h) DESCRIPTIVE HEADINGS. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be
part of or to affect the meaning or interpretation of this Agreement.
(i) SEVERABILITY. If any term or provision of this Agreement or the
application thereof to any party or set of circumstances shall, in any
jurisdiction and to any extent, be finally held invalid or
unenforceable, such term or provision shall only be ineffective as to
such jurisdiction, and only to the extent of such invalidity or
unenforceability, without invalidating or rendering unenforceable any
other terms or provisions of this Agreement under any other
circumstances, and the parties shall negotiate in good faith a
substitute provision which comes as close as possible to the
invalidated or unenforceable term or provision, and which puts each
party in a position as nearly comparable as possible to the position it
would have been in but for the finding of invalidity or
unenforceability, while remaining valid and enforceable.
(j) DEFINITIONS; CONSTRUCTION. For purposes of this Agreement:
(i) "Beneficially Own" or "Beneficial Ownership" with respect to
any securities shall mean having "beneficial ownership" of such
securities (as determined pursuant to Rule 13d-3 under the Exchange
Act), including pursuant to any agreement, arrangement or
understanding, whether or not in writing. Without duplicative
counting of the same securities by the same holder, securities
Beneficially Owned by a Person shall include securities Beneficially
Owned by all other Persons with whom such Person would constitute a
"group" as described in Section 13(d)(3) of the Exchange Act.
(ii) "Person" shall mean an individual, corporation, partnership,
joint venture, association, trust, unincorporated organization or
other entity.
(iii) In the event of a stock dividend or distribution, or any
change in the Company Common Stock by reason of any stock dividend,
split-up, recapitalization, combination, exchange of shares or the
like, the term "Shares" shall be deemed to refer to and include the
Shares as well as all such stock dividends and distributions and any
shares into which or for which any or all of the Shares may be
changed or exchanged. In addition, in the event of any change in the
Company's capital stock by reason of stock dividends, stock splits,
mergers, consolidations, recapitalizations, combinations,
conversions, exchanges of shares, extraordinary or liquidating
dividends, or other changes in the corporate or capital structure of
the Company which would have the effect of diluting or changing the
Acquiror's rights hereunder, the number and kind of shares or
ecurities subject to the Option and the purchase price per Share
(but not the total purchase price) shall be appropriately and
equitably adjusted so that the Acquiror shall receive upon exercise
or the Acquiror Option the number and class of shares or other
securities or property that the Acquiror would have received in
respect of the Shares purchasable upon exercise of the Acquiror
Option if the Acquiror Option had been exercised immediately prior
to such event. Each Shareholder shall take such steps in connection
with such consolidation, merger, liquidation or other such action as
may be necessary to assure that the provisions hereof shall
thereafter apply as nearly as possible to any securities or property
thereafter deliverable upon exercise of the Acquiror Option.
(k) SHAREHOLDER CAPACITY. Notwithstanding anything herein to the
contrary, no person executing this Agreement who is, or becomes during
the term hereof, a director of the Company makes any agreement or
understanding herein in his or her capacity as such director, and the
agreements set forth herein shall in no way restrict any director in
the exercise of his or her fiduciary duties as a director of the
Company. Each Shareholder has executed this Agreement solely in his or
her capacity as the record or beneficial holder of such Shareholder's
Shares or as the trustee of a trust whose beneficiaries are the
beneficial owners of such Shareholder's Shares.
[signature page follows]
IN WITNESS WHEREOF, Acquiror and each Shareholder have caused this Agreement
to be duly executed as of the day and year first above written.
Career Education Corporation
/s/ Xxxxxxx X. Xxxxx
By: _________________________________
Xxxxxxx X. Xxxxx
Chief Financial Officer
SHAREHOLDERS:
/s/ X. Xxxxxx
_____________________________________
R. Xxxxxx Xxxxxx
/s/ Xxxxx Xxxxxx
_____________________________________
Xxxxx Xxxxxx
Xxxxxx Family Limited Partnership
/s/ X. Xxxxxx
_____________________________________
By: R. Xxxxxx Xxxxxx
Its: General Partner
The Xxxxxx Family Foundation, Inc.
/s/ X. Xxxxxx
_____________________________________
By: R. Xxxxxx Xxxxxx
Its: President
SCHEDULE 1(a)
Number of Shares
-----------------
Class A Class B
Common Common
Record Holder Stock Stock
------------- ------- ---------
R. Xxxxxx Xxxxxx............................................. 459,772 3,890,817
Xxxxx Xxxxxx................................................. N/A 2,866,150
Xxxxxx Family Limited Partnership............................ N/A 602,700
The Xxxxxx Family Foundation, Inc............................ 42,000 N/A
SCHEDULE 1(d)
None.
