EXHIBIT 10.7
DISTRIBUTION AGREEMENT
THIS DISTRIBUTION AGREEMENT (this "Agreement") is made and entered
---------
into as of this ___ day of April, 1998, by and between Vencor, Inc., a Delaware
corporation ("Vencor"), and Vencor Healthcare, Inc., a Delaware corporation
------
("Healthcare Company").
--------------------
W I T N E S S E T H:
WHEREAS, the Board of Directors of Vencor has determined that it is
appropriate and desirable to (a) pursuant to the Reorganization Agreement (as
defined herein), separate Vencor and its subsidiaries into two publicly-owned
companies so that (i) the assets and liabilities relating to substantially all
of the Vencor-owned land, buildings and other improvements and real estate
related assets are allocated to Vencor (the "Real Estate Business"), which will
--------------------
be renamed "Ventas, Inc." immediately prior to the Distribution (as defined
herein), and (ii) the other assets and liabilities relating to the historical
operations of Vencor, including the Development Properties (as defined herein),
are allocated to Healthcare Company (the "Healthcare Business"), which will be
--------------------
renamed Vencor, Inc. immediately prior to the Distribution; and (b) distribute
(the "Distribution"), following such reorganization, as a dividend to the
------------
holders of the issued and outstanding shares of common stock, par value $.25 per
share, of Vencor ("Vencor Common Stock") all of the issued and outstanding
-------------------
shares of common stock, par value $.25 per share, of Healthcare Company
("Healthcare Company Common Stock") on the basis of one share of Healthcare
----------------------------------
Company Common Stock for each share of Vencor Common Stock; and
WHEREAS, the parties hereto have determined that it is necessary and
desirable to set forth the principal corporate transactions required to effect
the Distribution.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants contained in this Agreement and intending to be legally bound hereby,
the parties hereto agree as follows:
ARTICLE I
DEFINITIONS
1.01 General. Unless otherwise defined herein or unless the context
-------
otherwise requires, the following terms shall have the following meanings (such
meanings to be equally applicable to both the singular and plural forms of the
terms defined):
"Action" shall mean any demand, action, suit, countersuit,
------
arbitration, inquiry, proceeding or investigation by or before any federal,
state, local, foreign or international Governmental Authority or any arbitration
or mediation tribunal.
-1-
"Affiliate" shall mean with respect to any specified Person, a Person
---------
that directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, such specified Person; provided,
--------
however, that for purposes of this Agreement, no member of either Group shall be
-------
deemed to be an Affiliate of any member of the other Group.
"Agent" shall mean National City Bank, Cleveland, Ohio or such trust
-----
company or bank designated by Vencor, which shall act as agent for the holders
of Vencor Common Stock and the holders of Healthcare Company Common Stock in
connection with the Distribution.
"Agreement" shall have the meaning set forth in the preamble to this
---------
Agreement.
"Ancillary Agreements" shall mean all the written agreements,
--------------------
instruments, understandings, assignments or other arrangements (other than this
Agreement) entered into by the parties hereto or any other member of their
respective Group in connection with the Corporate Restructuring Transactions,
the Distribution and the other transactions contemplated hereby or thereby,
including without limitation, the following:
(i) the Master Lease Agreement;
(ii) the Development Agreement;
(iii) the Participation Agreement;
(iv) the Employee Benefits Agreement;
(v) the Intellectual Property Agreement;
(vi) the Tax Allocation Agreement;
(vii) the Transition Services Agreement;
(viii) the Conveyance and Assumption Instruments;
(ix) the Debt and Cash Allocation Agreement;
(x) the Reorganization Agreement; and
(xi) the Insurance Agreement.
"Annual Meeting" shall mean the 1998 Annual Meeting of Stockholders of
--------------
Vencor to be held on April 27, 1998, or any adjournments or postponements
thereof.
"Corporate Restructuring Transactions" shall mean, collectively, (a)
------------------------------------
each of the mergers, transfers, conveyances, contributions, assignments and
other transactions described and set forth on Exhibit A of this Agreement, and
---------
(b) such other mergers, transfers, conveyances, contributions, assignments and
other transactions that may be appropriate or required to be
-2-
accomplished, effected or consummated by Vencor or Healthcare Company or any of
their respective Subsidiaries and Affiliates in order to separate and divide, in
a series of transactions, Vencor so that: (i) the Healthcare Company Assets,
Healthcare Company Liabilities and Healthcare Business shall be owned, directly
or indirectly, by Healthcare Company; and (ii) the Real Estate Assets, Real
Estate Liabilities and Real Estate Business that remain after the separation and
division described in clause (i) above, are, after giving effect to the
Distribution, owned directly or indirectly, by Vencor.
"Debt and Cash Allocation Agreement" shall mean the Debt and Cash
----------------------------------
Allocation Agreement by and between Vencor and Healthcare Company, which
agreement shall be entered into prior to or on the Distribution Date in the form
attached to the Reorganization Agreement as Exhibit B.
---------
"Distribution" shall have the meaning set forth in the preamble to
------------
this Agreement.
"Distribution Date" shall mean the date, to be determined by the Board
-----------------
of Directors of Vencor, or such committee of the Board as shall be designated by
the Board of Directors, as of which the Distribution shall be effected.
"Distribution Record Date" shall mean the time and date determined by
------------------------
the Board of Directors of Vencor for purposes of determining the holders of
record of Vencor Common Stock entitled to participate in the Distribution.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
------------
amended, together with the rules and regulations promulgated thereunder.
"Financing Transactions" shall mean the Healthcare Company Financing
----------------------
Transactions and the Vencor Financing Transactions.
"Governmental Authority" shall mean any federal, state, local, foreign
----------------------
or international court, government, department, commission, board, bureau,
agency, the NYSE or other regulatory, administrative or governmental authority.
"Group" shall mean, with respect to Vencor, the Vencor Group and, with
-----
respect to Healthcare Company, the Healthcare Company Group.
"Healthcare Business" shall have the meaning set forth in the preamble
-------------------
to this Agreement.
"Healthcare Company" shall have the meaning set forth in the preamble
------------------
to this Agreement.
"Healthcare Company Assets" shall mean, collectively, all the rights
-------------------------
and assets that are owned by Healthcare Company or any of its Subsidiaries as of
the close of business on the Distribution Date, including without limitation:
-3-
(i) the capital stock of the Healthcare Company Subsidiaries;
(ii) all the assets included on the Healthcare Company Pro Forma
Balance Sheet that are owned by Healthcare Company or any of its
Subsidiaries as of the close of business on the Distribution Date;
(iii) all the assets and rights expressly allocated to Healthcare
Company or any of the Healthcare Company Subsidiaries under this Agreement
or any of the Ancillary Agreements; and
(iv) any other asset acquired by Vencor or any of its Subsidiaries
from the date of the Healthcare Company Pro Forma Balance Sheet to the
close of business on the Distribution Date that is owned by Vencor or any
of its Subsidiaries as of the close of business on the Distribution Date
and that is of a nature or type that would have resulted in such asset
being included as an asset on the Healthcare Company Pro Forma Balance
Sheet had it been acquired on or prior to the date of the Healthcare
Company Pro Forma Balance Sheet, determined on a basis consistent with the
determination of the assets included on the Healthcare Company Pro Forma
Balance Sheet.
"Healthcare Company Common Stock" shall have the meaning set forth in
-------------------------------
the preamble to this Agreement.
"Healthcare Company Financing Transactions" shall mean the entry into
-----------------------------------------
or issuance by Healthcare Company of (i) a revolving credit facility in the
amount of $300 million, (ii) a term loan in the amount of $300 million, (iii) a
second term loan in the amount of $200 million, (iv) a bridge loan in the amount
of $200 million, (v) $17.7 million proceeds of Healthcare Company preferred
stock and (vi) $300 million of senior subordinated debt or such other financing
transactions approved by the Healthcare Company Board of Directors.
"Healthcare Company Group" shall mean Healthcare Company, the
------------------------
Healthcare Company Subsidiaries and the corporations, partnerships, limited
liability companies, joint ventures, investments and other entities that
represent equity investments of Healthcare Company or any of the Healthcare
Company Subsidiaries following the consummation of the Corporate Restructuring
Transactions and the Distribution.
"Healthcare Company Liabilities" shall mean, collectively, all of the
------------------------------
Liabilities of Healthcare Company, the Healthcare Company Subsidiaries and each
of the other members of the Healthcare Company Group after giving effect to the
Corporate Restructuring Transactions, the Distribution and the transactions
contemplated under the Debt and Cash Allocation Agreement, including, without
limitation:
(i) all the Liabilities included on the Healthcare Company Pro Forma
Balance Sheet which remain outstanding as of the close of business on the
Distribution Date;
(ii) all other Liabilities that are incurred or which accrue or are
accrued at any time prior to, on or after the date of the Healthcare Company Pro
Forma Balance Sheet and that
-4-
arise or arose out of, or in connection with, the Healthcare Company Assets or
the Healthcare Business, determined on a basis consistent with the determination
of the Liabilities of Healthcare Company on the Healthcare Company Pro Forma
Balance Sheet;
(iii) all the Liabilities of Healthcare Company, the Healthcare
Company Subsidiaries or any of the other members of the Healthcare Company Group
under, or to be retained or assumed by Healthcare Company, any Healthcare
Company Subsidiary or any of the other members of the Healthcare Company Group
pursuant to this Agreement or any of the Ancillary Agreements; and
(iv) all the Liabilities of the parties hereto or their respective
Subsidiaries (whenever arising whether prior to, at or following the
Distribution Data) arising out of or in connection with or otherwise relating to
the management or conduct before or after the Distribution Date of the
Healthcare Business, except as otherwise specifically provided herein.
"Healthcare Company Pro Forma Balance Sheet" shall mean the pro forma
------------------------------------------
balance sheet of Healthcare Company at December 31, 1997 attached hereto as
Exhibit B.
---------
"Healthcare Company Subsidiaries" shall mean all of the subsidiaries
-------------------------------
listed on Schedule 1.01(a) of this Agreement.
----------------
"Law" shall mean all laws, statutes and ordinances and all
---
regulations, rules and other pronouncements of Governmental Authorities having
the effect of law of the United States, any foreign country, or any domestic or
foreign state, province, commonwealth, city, country, municipality, territory,
protectorate, possession or similar instrumentality, or any Governmental
Authority thereof.
"Liabilities" shall mean any and all debts, liabilities, obligations,
-----------
responsibilities, response actions, losses, damages (whether compensatory,
punitive or treble), fines, penalties and sanctions, absolute or contingent,
matured or unmatured, liquidated or unliquidated, foreseen or unforeseen, joint,
several or individual, asserted or unasserted, accrued or unaccrued, known or
unknown, whenever arising, including without limitation those arising under or
in connection with any Law (including any Environmental Law), Action, threatened
Action, order or consent decree of any Governmental Authority or any award of
any arbitration tribunal, and those arising under any contract, guarantee,
commitment or undertaking, whether sought to be imposed by a Governmental
Authority, private party, or party to this Agreement, whether based in contract,
tort, implied or express warranty, strict liability, criminal or civil statute,
or otherwise, and including any costs, expenses, interest, attorneys' fees,
disbursement and expense of counsel, expert and consulting fees and costs
related thereto or to the investigation or defense thereof.
"NYSE" shall mean the New York Stock Exchange, Inc.
----
"Person" shall mean an individual, a partnership, a joint venture, a
------
corporation, a trust, a limited liability company, an unincorporated
organization or a government or any department or agency thereof.
-5-
"Real Estate Business" shall have the meaning set forth in the
--------------------
preamble to this Agreement.
"Registration Statement" shall mean the registration statement on Form
----------------------
10 to effect the registration of the Healthcare Company Common Stock pursuant to
the Exchange Act.
"Reorganization Agreement" shall mean the Agreement and Plan of
------------------------
Reorganization by and between Vencor and Healthcare Company which shall be
entered into prior to or on the Distribution Date.
"Subsidiary" shall mean with respect to any specified Person, any
----------
corporation or other legal entity of which such Person or any of its
Subsidiaries controls or owns, directly or indirectly, more than 50% of the
stock or other equity interest entitled to vote on the election of members to
the board of directors or similar governing body; provided, however, that for
-------- -------
purposes of this Agreement, (a) the Healthcare Company Subsidiaries shall be
deemed to be Subsidiaries of Healthcare Company and (b) Healthcare Company and
the Healthcare Company Subsidiaries shall not be deemed to be Subsidiaries of
Vencor or any of Vencor's Subsidiaries.
"Tax Allocation Agreement" shall mean the Tax Allocation Agreement by
------------------------
and between Vencor and Healthcare Company, which agreement shall be entered into
prior to or on the Distribution Date in the form attached to the Reorganization
Agreement as Exhibit K.
---------
"Vencor" shall have the meaning set forth in the preamble to this
------
Agreement.
"Vencor Assets" shall mean, collectively, all the rights and assets
-------------
that are owned by Vencor or any of its Subsidiaries as of the close of business
on the Distribution Date (other than the Healthcare Company Assets and the
capital stock of Healthcare Company and the Healthcare Company Subsidiaries),
including without limitation:
(i) the capital stock of the Vencor Subsidiaries;
(ii) all the assets included on the Vencor Pro Forma Balance Sheet
which are owned by Vencor and its Subsidiaries as of the close of business
on the Distribution Date, including the real property to be retained by
Vencor in connection with the Corporate Restructuring Transactions;
(iii) all the assets and rights expressly allocated to Vencor or any
of its Subsidiaries under this Agreement and any of the Ancillary
Agreements; and
(iv) any other asset acquired by Vencor or any of its Subsidiaries
from the date of the Vencor Pro Forma Balance Sheet to the close of
business on the Distribution Date that is owned by Vencor or any of its
Subsidiaries and that is of a nature of type that would have resulted in
such asset being included as an asset on the Vencor Pro Forma Balance Sheet
had it been acquired on or prior to the date of the Vencor Pro Forma
Balance Sheet, determined on a basis consistent with the determination of
the assets included on the Vencor Pro Forma Balance Sheet.
-6-
"Vencor Certificate Amendments" shall mean the amendments to the
-----------------------------
Vencor Certificate of Incorporation proposed by the Board of Directors of Vencor
to be considered and voted on by the stockholders of Vencor at the Annual
Meeting.
"Vencor Common Stock" shall have the meaning set forth in the preamble
-------------------
to this Agreement.
"Vencor Financing Transactions" shall mean the entry into by Vencor of
-----------------------------
(i) a revolving credit facility in the amount of $250 million, (ii) a term loan
in the amount of $250 million, (iii) a second term loan in the amount of $250
million and (iv) a bridge loan in the amount of $450 million or such other
financing transactions approved by the Vencor Board of Directors.
"Vencor Group" means Vencor, the Vencor Subsidiaries and the
------------
corporations, partnerships, joint ventures, investments and other entities that
represent equity investments of Vencor or any of the Vencor Subsidiaries
following consummation of the Corporate Restructuring Transactions and the
Distribution.
"Vencor Pro Forma Balance Sheet" shall mean the pro forma balance
------------------------------
sheet of Vencor attached hereto as Exhibit C.
---------
"Vencor Subsidiaries" shall mean the Subsidiaries of Vencor set forth
-------------------
on Schedule 1.01(b) of this Agreement and all other Subsidiaries of Vencor other
----------------
than Healthcare Company and the Healthcare Company Subsidiaries.
ARTICLE II
DISTRIBUTION TRANSACTIONS
2.01. Vencor Action Prior to the Distribution. Prior to the
---------------------------------------
Distribution, subject to the terms and conditions set forth herein, Vencor shall
take, or cause to be taken, the following actions in connection with the
Distribution.
(a) Notice to NYSE. Vencor shall, to the extent possible, give
--------------
the NYSE not less than ten days advance notice of the Distribution Record Date
in compliance with Rule 10b-17 under the Exchange Act.
(b) Distribution Transactions. Vencor shall cause all
-------------------------
transactions contemplated by the Reorganization Agreement to have occurred prior
to, or to occur simultaneous with, the consummation of this Agreement.
2.02. The Distribution.
----------------
(a) Duties and Obligations of Vencor. Subject to the conditions
--------------------------------
herein, on or prior to the Distribution Date, Vencor shall:
-7-
(i) deliver to the Agent the share certificates representing the
Healthcare Company Common Stock, endorsed by Vencor in blank, for the
benefit of the holders of Vencor Common Stock;
(ii) instruct the Agent to distribute, as soon as practicable
following consummation of the Distribution, to the holders of Vencor Common
Stock the following:
(A) one share of Healthcare Company Common Stock for every share
of Vencor Common Stock; and
(B) cash, if applicable, in lieu of fractional shares obtained
in the manner provided in Section 2.03; and
(iii) subject to stockholder approval at the Annual Meeting of
the Vencor Certificate Amendment to change the name of Vencor to "Ventas,
Inc.," instruct the Agent to distribute, as soon as practicable following
consummation of the Distribution, to the holders of certificated shares of
Vencor Common Stock a letter of transmittal providing for such holders to
forward to the Agent all of their certificated shares of Vencor Common
Stock in order to exchange such shares for a corresponding number of new
certificated shares of Vencor Common Stock which reflect such name change.
(b) Duties and Responsibilities of Healthcare Company. Healthcare
-------------------------------------------------
Company shall provide, or cause to be provided, to the Agent sufficient
certificates representing Healthcare Company Common Stock in such denominations
as the Agent may request in order to effect the Distribution. All shares of
Healthcare Company Common Stock issued pursuant to the Distribution will be
validly issued, fully paid and nonassessable and free of any preemptive (or
similar) rights.
2.03. Fractional Shares.
-----------------
(a) No Fractional Shares. Notwithstanding anything herein to the
--------------------
contrary, no fractional shares of Healthcare Company Common Stock shall be
issued in connection with the Distribution, and any such fractional share
interests to which a stockholder would otherwise be entitled will not entitle
such stockholder to vote or to any rights of a stockholder of Healthcare
Company. In lieu of any such fractional shares, each stockholder who, but for
the provisions of this Section, would be entitled to receive a fractional share
interest of Healthcare Company Common Stock pursuant to the Distribution shall
be paid cash without any interest thereon, as hereinafter provided. Vencor
shall instruct the Agent to determine the number of whole shares and fractional
shares of Healthcare Company Common Stock allocable to each stockholder, to
aggregate all such fractional shares into whole shares, to sell the whole shares
obtained thereby in the open market at the then prevailing prices on behalf of
stockholders who otherwise would be entitled to receive fractional share
interests and to distribute to each such stockholder his, her or its ratable
share of the total proceeds of such sale, after making appropriate deductions of
the amount required for Federal income tax withholding purposes and after
deducting any applicable transfer
-8-
taxes. All brokers' fees and commissions incurred in connection with such sales
shall be paid by Vencor.
(b) Unclaimed Stock or Cash. Any Healthcare Company Common Stock or
-----------------------
cash in lieu of fractional shares and dividends or distributions with respect to
Healthcare Company Common Stock that remain unclaimed by any stockholder 180
days after the Distribution Date shall be returned to Vencor and any such
stockholders shall look only to Vencor for the Healthcare Company Common Stock
and cash, if any, in lieu of fractional share interests and any such dividends
or distributions to which they are entitled, subject in each case to applicable
escheat or other abandoned property laws.
(c) Beneficial Owners. Solely for purposes of computing fractional
-----------------
share interests pursuant to Section 2.03(a), the beneficial owner of shares of
Vencor Common Stock or Healthcare Company Common Stock held of record in the
name of a nominee will be treated as the holder of record of such shares.
ARTICLE III
CONDITIONS TO THE DISTRIBUTION
3.01 Conditions to Obligations.
-------------------------
(a) The obligations of the parties hereto to consummate the
Distribution are subject to the satisfaction, as determined by Vencor in its
sole discretion, of each of the following conditions:
(i) The Reorganization Agreement shall have been approved by
the holders of a majority of the outstanding shares of Vencor Common Stock
at the Annual Meeting;
(ii) The Distribution shall have been approved by the holders
of a majority of the outstanding shares of Vencor Common Stock at the
Annual Meeting and by the Vencor Board of Directors;
(iii) Each of the Vencor Certificate Amendments shall have been
approved by the holders of a majority of the outstanding shares of Vencor
Common Stock;
(iv) The transactions contemplated by Article II of the
Reorganization Agreement, including the Corporate Restructuring
Transactions, shall have been consummated in all material respects;
(v) The Healthcare Company Common Stock shall have been
approved for listing on the NYSE, subject to official notice of issuance;
(vi) The Registration Statement shall have been filed with the
SEC and shall have become effective, and no stop order with respect thereto
shall be in effect;
-9-
(vii) All material authorizations, consents, approvals and
clearances of Federal, state, local and foreign governmental agencies
required to permit the valid consummation by the parties hereto of the
transactions contemplated by this Agreement and the Reorganization
Agreement shall have been obtained; and no such authorization, consent,
approval or clearance shall contain any conditions which would have a
material adverse effect on (A) the Real Estate Business or the Healthcare
Business, (B) the Healthcare Company Assets and Vencor Assets, results of
operations or financial condition of the Vencor Group or the Healthcare
Company Group, in each case taken as a whole, or (C) the ability of Vencor
or Healthcare Company to perform its obligations under this Agreement and
the Reorganization Agreement; and all statutory requirements for such valid
consummation shall have been fulfilled;
(viii) No preliminary or permanent injunction or other order,
decree or ruling issued by a court of competent jurisdiction or by a
government, regulatory or administrative agency or commission, and no
statute, rule, regulation or executive order promulgated or enacted by any
governmental authority, shall be in effect preventing the consummation of
this Agreement, the Reorganization Agreement or the Distribution;
(ix) The Financing Transactions shall have occurred and all
bank credit agreements, debt security or other financing facility entered
into pursuant thereto shall be in place and all conditions to borrowing
thereunder (other than any conditions concerning consummation of the
Distribution and the transfers of assets and liabilities described
hereunder) shall have been satisfied, and all necessary consents, waivers
or amendments to each bank credit agreement, debt security or other
financing facility to which any member of the Vencor Group or the
Healthcare Company Group is a party or by which any such member is bound
shall have been obtained, or each such agreement, security or facility
shall have been refinanced, in each case on terms satisfactory to Vencor
and to the extent necessary to permit the Distribution to be consummated
without any material breach of the terms of such agreement, security or
facility; and
(x) An officer of Vencor shall have instructed the Agent to
make the Distribution effective.
(b) The foregoing conditions are for the sole benefit of Vencor and
shall not give rise to any duty on the part of Vencor or its Board of Directors
to waive or not waive any such condition. Any determination made by the Board
of Directors of Vencor in good faith on or prior to the Distribution Date
concerning the satisfaction or waiver of any or all of the conditions set forth
in Section 3.01(a) shall be conclusive.
3.02 No Constraints. Notwithstanding the provisions of Section 3.01,
--------------
the fulfillment or waiver of any or all of the conditions precedent to the
Distribution set forth therein shall not:
(a) create any obligation on the part of Vencor or any other party
hereto to effect the Distribution;
-10-
(b) in any way limit Vencor's right and power under Section 4.12 to
terminate this Agreement or the Reorganization Agreement and the process leading
to the Distribution and to abandon the Distribution; or
(c) alter the consequences of any such termination under Section
4.12 from those specified in such Section.
3.03 Deferral of the Distribution Date. If the Distribution Date
---------------------------------
shall have been established by the Board of Directors of Vencor but all the
conditions precedent to the Distribution set forth in this Agreement have not
theretofore been fulfilled or waived, or Vencor does not reasonably anticipate
that they will be fulfilled or waived, on or prior to the date established as
the Distribution Date, the Distribution shall not occur at the time established
and, Vencor may, by resolution of its Board of Directors (or a committee
thereof, so authorized), defer the Distribution Date to a later date.
3.04 Public Notice of the Deferred Distribution Date. If the
-----------------------------------------------
Distribution Date is deferred in accordance with Section 3.03 and public
announcement of the prior Distribution Date has theretofore been made, Vencor
shall promptly thereafter issue a public announcement with respect to such
deferment and shall take such other actions as may be deemed necessary or
desirable with respect to the dissemination of such information.
ARTICLE IV
MISCELLANEOUS
4.01 Indemnification, Access to Information and Dispute Resolution.
-------------------------------------------------------------
Each of Vencor and Healthcare Company hereby agrees that Articles III, V and VI
of the Reorganization Agreement regarding indemnification, access to information
and dispute resolution shall be applicable in all respects to this Agreement.
4.02 Complete Agreement. This Agreement, the Exhibits and Schedules
------------------
hereto, the Ancillary Agreements and the agreements and other documents referred
to herein shall constitute the entire agreement between the parties hereto with
respect to the subject matter hereof and shall supersede all previous
negotiations, commitments and writings with respect to such subject matter.
4.03 Expenses. All costs and expenses of any party hereto whether
--------
incurred prior to or after the Distribution Date in connection with the
preparation, execution, delivery and implementation of this Agreement and with
the consummation of the transactions contemplated by this Agreement and the
Ancillary Agreements, including but not limited to legal fees, accounting fees,
investment banking fees, and all such other costs and expenses shall be
allocated among Vencor and the Healthcare Company in accordance with the Debt
and Cash Allocation Agreement and the Tax Allocation Agreement.
4.04 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware (other than the
laws regarding choice of laws
-11-
and conflicts of laws) as to all matters, including matters of validity,
construction, effect, performance and remedies.
4.05 Notices. All notices, requests, claims, demands and other
-------
communications hereunder (collectively, "Notices") shall be in writing and shall
-------
be given (and shall be deemed to have been duly given upon receipt) by delivery
in person, by cable, telegram, facsimile, electronic mail or other standard form
of telecommunications (provided confirmation is delivered to the recipient the
next Business Day in the case of facsimile, electronic mail or other standard
form of telecommunications) or by registered or certified mail, postage prepaid,
return receipt requested, addressed as follows:
If to Vencor:
President
Vencor, Inc.
0000 Xxxxx Xxxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile:
with a copy to:
General Counsel
Vencor, Inc.
0000 Xxxxx Xxxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
If to Healthcare Company:
President
Vencor Healthcare, Inc.
0000 Xxxxx Xxxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile:
-12-
with a copy to:
General Counsel
Vencor Healthcare, Inc.
0000 Xxxxx Xxxxxx
000 Xxxx Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
or to such other address as any party hereto may have furnished to the other
parties by a notice in writing in accordance with this Section 4.05.
4.06 Amendment and Modification. This Agreement may be amended,
--------------------------
modified or supplemented only by a written agreement signed by both of the
parties hereto.
4.07 Successors and Assigns; No Third Party Beneficiaries. This
----------------------------------------------------
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the parties hereto and their successors and permitted assigns but
neither this Agreement nor any of the rights, interests and obligations
hereunder shall be assigned by any party hereto without the prior written
consent of the other party (which consent shall not be unreasonably withheld or
delayed). This Agreement is solely for the benefit of the parties hereto and
their Subsidiaries and Affiliates and is not intended to confer upon any other
Persons any rights or remedies hereunder.
4.08 Counterparts. This Agreement may be executed in two or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
4.09 Interpretation. The Article and Section headings contained in
--------------
this Agreement are solely for the purpose of reference, are not part of the
agreement of the parties hereto and shall not in any way affect the meaning or
interpretation of this Agreement.
4.10 Legal Enforceability. Any provision of this Agreement which is
--------------------
prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction,
be ineffective to the extent of such prohibition or unenforceability without
invalidating the remaining provisions hereof. Any such prohibition or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction. Each party acknowledges
that money damages would be an inadequate remedy for any breach of the
provisions of this Agreement and agrees that the obligations of the parties
hereunder shall be specifically enforceable.
4.11 References; Construction. References to any "Article",
------------------------
"Exhibit", "Schedule" or "Section", without more, are to Appendices, Articles,
Exhibits, Schedules and Sections to or of this Agreement. Unless otherwise
expressly stated, clauses beginning with the term "including" set forth examples
only and in no way limit the generality of the matters thus exemplified.
-13-
4.12 Termination. Notwithstanding any provision hereof, this
-----------
Agreement may be terminated and the Distribution abandoned at any time prior to
the Distribution Date by and in the sole discretion of the Board of Directors of
Vencor without the approval of any other party hereto or of Vencor's
stockholders. In the event of such termination, no party hereto shall have any
Liability to any Person by reason of this Agreement.
-14-
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first above written.
VENCOR, INC.
By:
-------------------------
Name:
Title:
VENCOR HEALTHCARE, INC.
By:
------------------------
Name:
Title:
-15-
