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EXHIBIT 10.61
The following persons are party to the form of Voting Agreement attached hereto
as Exhibit 10.61.
Stockholder Number of Shares
----------- ----------------
J. Xxxxx Xxxxxx.................. 47,872
Xxxxxxx X. Xxxxx................. 44,682
Xxxxxx X. Xxxxx.................. 6,000
C. Xxx Xxxxxxxxxx................ 14,250
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EXHIBIT 10.61
VOTING AGREEMENT
VOTING AGREEMENT, dated as of May 5, 1998 (this "Agreement"),
between Foundation Health Corporation, a Delaware corporation ("Seller"), and
[__________________] (the "Stockholder").
WHEREAS, Seller and Superior National Insurance Group, Inc., a
Delaware corporation (the "Company") have, contemporaneously with the execution
of this Agreement, entered into a Purchase Agreement, dated as of the date
hereof (as the same may be amended or supplemented, the "Purchase Agreement"),
which provides, among other things, that the Company desires to purchase from
Seller, and Seller desires to sell to the Company, all of the shares of the
Business Insurance Group, Inc., a Delaware insurance holding company ("BIG"),
subject to the terms and conditions of the Purchase Agreement (the "Purchase");
and
WHEREAS, as of the date hereof, the Stockholder is the Beneficial
Owner (as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended) of [_________] shares of Common Stock entitled to vote, par value $.01
per share of the Company ("Company Common Stock"); and
WHEREAS, as a condition to the willingness of Seller to enter
into the Purchase Agreement, Seller has required that the Stockholder agree, and
in order to induce Seller to enter into the Purchase Agreement, the Stockholder
has agreed, to enter into this Agreement.
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:
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ARTICLE I
VOTING OF SHARES
Section 1.1 Voting Agreement. The Stockholder hereby agrees,
during the time this Agreement is in effect, at any meeting of the stockholders
of the Company relating to the Purchase, to: (a) appear, or cause the holder of
record on the applicable record date (the "Record Holder") to appear, at any
annual or special meeting of stockholders of the Company for the purpose of
obtaining a quorum; (b) vote, or cause the Record Holder to vote, in person or
by proxy, all of the shares of the Company Common Stock owned or with respect to
which the Stockholder has or shares voting power and shares of the Company
Common Stock which shall, or with respect to which voting power shall, hereafter
be acquired by the Stockholder (collectively, the "Shares") in favor of (i) the
issuance of shares of common stock, par value $.01 per share, of the Company
pursuant to the purchase agreement (and related letter agreement with Zurich
Centre Investments Ltd. ("ZCI")) with Insurance Partners, L.P. ("IP"), Insurance
Partners Offshore (Bermuda), L.P. ("IPB"), and Capital Z Partners, Ltd.
("Capital Z") (collectively, the "1998 Stock Purchase Agreement"), dated the
date hereof, (ii) the transactions contemplated by (x) the 1998 Stock Purchase
Agreement and (y) the Debt Offering (as defined in the 1998 Stock Purchase
Agreement) (together, the "Financing Agreements") for the financing of the
transactions contemplated by the Purchase Agreement and (iii) any amendment to
the certificate of incorporation of the Company necessary to complete the
transactions contemplated by the 1998 Stock Purchase Agreement; and (c) vote, or
cause the Record Holder to vote, such Shares against: (i) any extraordinary
corporate transaction (other than the Purchase), such as a merger,
consolidation, business combination, reorganization, recapitalization or
liquidation involving the Company or any of its subsidiaries, and (ii) any sale
or transfer of a material amount of the assets of the Company or any of its
subsidiaries if the transactions described in clauses (i) or (ii) would
adversely effect the Company's ability to complete the Purchase. The Stockholder
acknowledges receipt and review of a copy of the Purchase Agreement.
Section 1.2 Irrevocable Proxy. (a) In furtherance of the
transactions contemplated hereby, concurrently with the execution of this
Agreement, the Stockholder shall execute and deliver to Seller a proxy in the
form attached hereto as Exhibit A (the "Proxy"). THE PROXY IS IRREVOCABLE AND
COUPLED WITH AN INTEREST. Such irrevocable Proxy is executed and intended to be
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irrevocable in accordance with the provisions of Section 212(e) of the Delaware
General Corporation Law (the "DGCL").
(b) The Stockholder hereby revokes all other proxies and
powers of attorney with respect to the Shares which the Stockholder may have
heretofore appointed or granted only to the extent it relates to the matters
referred to in Section 1.1 hereof, and no subsequent proxy or power of attorney
shall be given or written consent executed only to the extent it relates to the
matters referred to in Section 1.1 hereof (and if given or executed, such proxy
or power of attorney shall not be effective) by such Stockholder with respect
thereto. All authority conferred by this Section 1.2 or agreed to be conferred
shall survive the death or incapacity of the Stockholder and any obligation of
the Stockholder under this Agreement shall be binding upon the heirs, personal
representatives, assigns and successors of the Stockholder.
(c) The Seller hereby agrees, during the time this
Agreement is in effect, to take any and all actions necessary to cause the
Proxies to be voted at any meeting of the Company's stockholders in favor of all
the transactions contemplated by the Financing Agreements.
(d) The Seller hereby agrees not to consent to any
amendment or modification to the Purchase Agreement which would adversely effect
the Stockholder, including, but not limited to, Article VII or the definition of
"Closing Date" as contained therein, pursuant to the terms of this Agreement
without the prior written consent of the Stockholder.
Section 1.3 No Inconsistent Agreements. The Stockholder hereby
covenants and agrees that, except as contemplated by this Agreement and the
Purchase Agreement, the Stockholder shall not (i) enter into any voting
agreement or arrangement with respect to the Shares only to the extent it
relates to the matters referred to in Section 1.1 hereof, (ii) grant a proxy or
power of attorney or other authorization with respect to the Shares only to the
extent it relates to the matters referred to in Section 1.1 hereof or (iii) take
any other action, in each case, that would in anyway restrict, limit or
interfere with the performance of the Stockholder's obligations hereunder or the
transactions contemplated hereby.
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ARTICLE II
RESTRICTIONS ON TRANSFER
Section 2.1 Transfer of Title or Beneficial Ownership. The
Stockholder hereby covenants and agrees that the Stockholder will not, prior to
the termination of this Agreement, either directly or indirectly, offer, agree
or otherwise sell, assign, pledge, hypothecate, transfer, exchange, or dispose
of any Shares or any interest therein, owned either directly or indirectly by
the Stockholder or with respect to which the Stockholder has the power of
disposition, whether now or hereafter acquired, other than pursuant to an
agreement which specifically provides that the purchaser of such Shares will
assume the Stockholder's obligations hereunder.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDER
The Stockholder hereby represents and warrants to Seller as
follows:
Section 3.1 Authority Relative to This Agreement. The Stockholder
is competent to execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by the Stockholder and,
assuming the due authorization, execution and delivery by Seller, constitutes a
legal, valid and binding obligation of the Stockholder, enforceable against the
Stockholder in accordance with its terms, except that the enforcement hereof may
be limited by (i) bankruptcy, insolvency, or other similar laws now or
hereinafter in effect relating to creditors' rights generally and (ii) general
principles of equity (regardless of whether enforceability is considered in a
proceeding in equity or at law).
Section 3.2 No Conflict. The execution and delivery of this
Agreement by the Stockholder does not, and the performance of this Agreement by
the Stockholder shall not 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, bond, mortgage, indenture, contract,
agreement, lease, license, permit,
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franchise or other instrument or obligation to which the Stockholder is a party
or by which the Stockholder or the Shares are bound or affected, except, in the
case of each of the foregoing, for any such conflicts, violations, breaches,
defaults or other occurrences which would not prevent or delay the performance
by the Stockholder of its obligations under this Agreement.
Section 3.3 Title to the Shares. As of the date hereof, the
Stockholder is the record or Beneficial Owner of [________] shares of Company
Common Stock, which are all of the securities of the Company with voting rights
owned, either of record or beneficially, by the Stockholder. The Shares are
owned free and clear of any limitations on the Stockholder's voting rights.
Except as provided in this Agreement, the Stockholder has not appointed or
granted any proxy, which appointment or grant is still effective, with respect
to the Shares.
ARTICLE IV
MISCELLANEOUS
Section 4.1 Termination. This Agreement shall terminate upon the
earliest to occur of (a) the termination of the Purchase Agreement in accordance
with its terms pursuant to Article VII of the Purchase Agreement, as in effect
on the date hereof, and (b) the Closing Date (as defined in the Purchase
Agreement, as in effect on the date hereof). In the event of termination of this
Agreement pursuant to (a) above, written notice thereof shall forthwith be given
to the Stockholder.
Section 4.2 Enforcement of Agreement. The Stockholder agrees that
irreparable damage would occur and that Seller would not have any adequate
remedy at law 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 Seller shall be entitled to an injunction or
injunctions to prevent breaches by the Stockholder of this Agreement and to
enforce specifically the terms and provisions of this Agreement in the federal
courts of the United States of America located in Los Angeles County, California
(and federal courts having jurisdiction over appeals therefrom), this being in
addition to any other remedy to which Seller is entitled at law or in equity. In
addition, each of the parties hereto (i) irrevocably submits to the exclusive
jurisdiction of the federal courts of the United States of America located in
Los Angeles County, California (and federal courts having jurisdiction over
appeals therefrom) in respect of this Agreement, (ii)
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agrees that such party will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court and (iii)
agrees that such party will not bring any action relating to this Agreement in
any court other than the federal courts of the United States of America located
in Los Angeles County, California.
Section 4.3 Successors and Affiliates. This Agreement shall inure
to the benefit of and shall be binding upon the parties hereto and their
respective heirs, legal representatives and assigns. Neither this Agreement nor
any of the rights, interests or obligations under this Agreement shall be
assigned, in whole or in part, by operation of law or otherwise, by the
Stockholder or the Seller without the prior written consent of the other party,
except by laws of descent. If the Stockholder shall acquire ownership of, or
voting power with respect to, any additional Shares in any manner, whether by
the exercise of any options or any securities or rights convertible into or
exchangeable for Company Common Stock, operation of law or otherwise, such
Shares shall be held subject to all of the terms of this Agreement, and by
taking and holding such Shares, the Stockholder shall be conclusively deemed to
have agreed to be bound by and to comply with all of the terms and provisions of
this Agreement. Without limiting the foregoing, the Stockholder specifically
agrees that the obligations of the Stockholder hereunder shall not be terminated
by operation of law, whether by the death or incapacity of the Stockholder or
otherwise.
Section 4.4 Entire Agreement. This Agreement constitutes the
entire agreement between Seller and the Stockholder with respect to the subject
matter hereof and supersedes all prior agreements and understandings, both
written and oral, between Seller and the Stockholder with respect to the subject
matter hereof.
Section 4.5 Amendment. This Agreement may not be amended except
by an instrument in writing signed by the parties hereto.
Section 4.6 Waivers. Except as provided in this Agreement, no
action taken pursuant to this Agreement, including, without limitation, any
investigation by or on behalf of any party, shall be deemed to constitute a
waiver by the party taking such action of compliance with any representations,
warranties, covenants or agreements contained in this Agreement. The waiver by
any party hereto of a breach of any provision hereunder shall not operate or be
construed as a
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waiver of any prior or subsequent breach of the same or any other provision
hereunder.
Section 4.7 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
nevertheless remain in full force and effect. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent to 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 to the fullest
extent possible.
Section 4.8 Stockholder Capacity. If the Stockholder is or
becomes during the term hereof a director or officer of the Company, the
Stockholder makes no agreement or understanding herein in his or her capacity as
such director or officer. The Stockholder enters into this Agreement solely in
his or her capacity as the record holder and beneficial owner of the Shares and
nothing herein shall limit or affect any actions taken by the Stockholder in his
or her capacity as an officer or director of the Company to the extent
specifically permitted by the Purchase Agreement.
Section 4.9 Notices. All notices and other communications given
or made pursuant hereto shall be in writing and shall be deemed to have been
duly given or made and shall be effective upon receipt, if delivered personally,
mailed by registered or certified mail (postage prepaid, return receipt
requested) to the parties at the following addresses (or at such other address
for a party as shall be specified by like changes of address) or sent by
electronic transmission (provided that a confirmation copy is sent by another
approved means):
(i) if to Seller,
Foundation Health Systems, Inc.
000 Xxxxx Xxxx
Xxxxxx, XX 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: General Counsel
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with a copy to:
Skadden, Arps, Slate, Xxxxxxx &
Xxxx (Illinois)
000 Xxxx Xxxxxx Xxxxx
Xxxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Telecopy No.: (000) 000-0000
Attn: Xxxxx X. Xxxxx, Esq.
(ii) if to Stockholder, to the address set forth on
Schedule A hereto.
Section 4.10 Governing Law. The laws of the State of Delaware
(irrespective of its choice of law principles) shall govern all issues
concerning the validity of this Agreement, the construction of its terms, and
the interpretation and enforcement of the rights and duties of the parties.
Section 4.11 Counterparts. For the convenience of the parties
hereto, this Agreement may be executed in any number of counterparts, each such
counterpart being deemed to be an original instrument, and all such counterparts
shall together constitute the same agreement.
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IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be duly executed on the date hereof.
[ ]
--------------------------
By: /s/
---------------------------------
Name:
Foundation Health Corporation
FOUNDATION HEALTH CORPORATION
a Delaware Corporation
By: /s/ B. XXXXXX XXXXXX
------------------------------
Name: B. Xxxxxx Xxxxxx
Title: Sr. Vice President,
Gen. Counsel & Secretary
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EXHIBIT A
IRREVOCABLE PROXY
to Vote
Superior National Insurance Group, Inc.
COMMON STOCK
The undersigned stockholder of Superior National Insurance Group,
Inc., a Delaware corporation (the "Company"), hereby irrevocably (to the full
extent permitted by the General Corporation Law of the State of Delaware (the
"DGCL")), appoints B. Xxxxxx Xxxxxx and Xxxxxxx X. Xxxxxx, and each of them, as
the sole and exclusive attorneys and proxies of the undersigned, with full power
of substitution and resubstitution, to vote and exercise all voting and related
rights (to the full extent that the undersigned is entitled to do so) with
respect to all of the shares of capital stock of the Company that now are or
hereafter may be beneficially owned or owned of record by the undersigned, and
any and all other shares or securities of the Company issued or issuable in
respect thereof on or after the date hereof (collectively, the "Shares") in
accordance with the terms of this Proxy. The Shares beneficially owned or owned
of record by the undersigned stockholder of the Company as of the date of this
Proxy are listed on the final page of this Proxy. Upon the undersigned's
execution of this Proxy, any and all prior proxies given by the undersigned with
respect to any Shares only to the extent it relates to the matters referred to
in the third paragraph of this proxy are hereby revoked and the undersigned
agrees not to grant any subsequent proxies only to the extent it relates to the
matters referred to in the third paragraph of this proxy only with respect to
the Shares until after the Expiration Date (as defined below).
This Proxy is irrevocable (to the extent permitted by the DGCL),
is granted pursuant to that certain Voting Agreement, dated as of May 5, 1998,
between Seller and the undersigned stockholder of the Company (the "Voting
Agreement"), and is granted in consideration of Seller and the Company entering
into that certain Purchase Agreement, dated as of May 5, 1998 (the "Purchase
Agreement"). The Purchase Agreement provides for the Purchase of all of the
shares of the Business Insurance Group, Inc., a Delaware insurance holding
company ("BIG") upon the terms of the Purchase Agreement. As used herein, the
term "Expiration Date" shall mean the earlier to occur of (i) the termination of
the
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Voting Agreement in accordance with its terms, and (ii) such date and time as
the Purchase shall have become effective in accordance with the terms and
provisions of the Purchase Agreement as in effect on the date hereof.
The attorneys and proxies named above, and each of them, are
hereby authorized and empowered by the undersigned, at any time prior to the
Expiration Date, to act as the undersigned's attorney and proxy to vote the
Shares (including, without limitation, the power to execute and deliver written
consents pursuant to the DGCL) at every annual, special or adjourned meeting of
the stockholders of the Company and in every written consent in lieu of such
meeting: in favor of (i) the issuance of shares of common stock, par value $.01
per share, of the Company pursuant to the purchase agreement (and related letter
agreement with Zurich Centre Investments Ltd. ("ZCI")) with Insurance Partners,
L.P. ("IP"), Insurance Partners Offshore (Bermuda), L.P. ("IPB"), and Capital Z
Partners, Ltd. ("Capital Z") (collectively, the "1998 Stock Purchase
Agreement"), dated the date hereof, (ii) the transactions contemplated by (x)
the 1998 Stock Purchase Agreement and (y) the Debt Offering (as defined in the
1998 Stock Purchase Agreement) (together, the "Financing Agreements") for the
financing of the transactions contemplated by the Purchase Agreement and (iii)
any amendment to the certificate of incorporation of the Company necessary to
complete the transactions contemplated by the 1998 Stock Purchase Agreement; and
(b) against (i) any extraordinary corporate transaction (other than the
Purchase) such as a merger, consolidation, business combination, reorganization,
recapitalization or liquidation involving the Company or any of its
subsidiaries, and (ii) any sale or transfer of a material amount of the assets
of the Company or any of its subsidiaries if the transactions described in
clauses (i) or (ii) would adversely effect the Company's ability to complete the
Purchase. The attorneys and proxies named above may not exercise this Proxy on
any other matter except as provided in clauses (a) and (b) above. The
undersigned stockholder may vote the Shares on all other matters.
Notwithstanding any other provision of this Proxy, if the
Stockholder is or, prior to the Expiration Date, becomes a director or officer
of the Company, the provisions of this Proxy shall not limit or affect any
actions taken by the Stockholder in his or her capacity as an officer or
director of the Company to the extent specifically permitted by the Purchase
Agreement.
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Any obligation of the undersigned hereunder shall be binding upon
the successors and assigns of the undersigned.
Dated: May 4, 1998
[ ]
--------------------------
By: /s/
---------------------------------
Name:
Shares beneficially owned:
[ ] shares of Common Stock of the Company
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