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VENCOR, INC.
000 Xxxx Xxxxxx Xxxxxx
0000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxx 00000
June 12, 1997
Transitional Hospitals Corporation
0000 Xxxx Xxxxxx Xxxxxxxxx
Xxx Xxxxx, Xxxxxx 00000
Attention: Xxxxxxx X. Xxxxx, Chief Executive Officer
Dear Xx. Xxxxx:
This letter is intended to confirm our commitment with respect to the
form of Agreement and Plan of Merger by and among Vencor, Inc., a Delaware
corporation ("Vencor"), LV Acquisition Corp., a Delaware corporation ("Merger
Sub"), and Transitional Hospitals Corporation, a Nevada Corporation ("THC"),
and the associated disclosure schedules (together, the "Merger Agreement")
which is attached as Exhibit A to this letter. We understand that in reliance
upon Vencor's commitment in this letter THC may terminate the Agreement and Plan
of Merger, dated as of May 2, 1997, by and among THC, Select Medical
Corporation, a Delaware corporation ("Select Medical") and SM Acquisition Co.,
a Nevada corporation and a wholly owned subsidiary of Select Medical (the
"Select Medical Merger Agreement").
Vencor hereby agrees, subject to the proviso set forth below, that it will
execute and deliver the Merger Agreement to THC promptly following the
termination of the Select Medical Merger Agreement in accordance with its terms
and THC's execution and delivery of the Merger Agreement (including the
disclosure schedules in the attached form) to Vencor; provided, that none of the
conditions set forth in paragraphs (a), (b), (c), (d) or (e) of Annex A to the
Merger Agreement (the "Conditions") shall exist at such time (for purposes of
determining the existence of a Condition as set forth in the proviso it will be
assumed that the Merger Agreement is in existence). Vencor agrees that if any of
the Conditions set forth in paragraph (b) of Annex A do exist at a time when
Vencor otherwise would be required to execute the Merger Agreement, Vencor shall
use all reasonable efforts to cause the abatement of any such Conditions and to
execute the Merger Agreement promptly after none of such Conditions exist.
This agreement shall be null and void and shall terminate (i) at 8:00 p.m.
Pacific Daylight Time on Thursday, June 12, 1997 unless THC shall have given
Select Medical the written notice of termination of the Select Medical Merger
Agreement in accordance with Section 9.1(g) thereof and (ii) at the earlier of
the time at which Vencor and THC execute and deliver the Merger Agreement to
each other and 12:00 noon Pacific Daylight Time on Wednesday, June 18, 1997,
except that the termination of this agreement pursuant to clause (ii) shall be
extended until such time, not later than November 30, 1997, as is necessary to
comply with the last sentence of the preceding paragraph.
Very truly yours,
VENCOR, INC.
By: /s/ Xxxxx X. Xxxxxxxxxxx, Xx.
_______________________________
Name: Xxxxx X. Xxxxxxxxxxx, Xx.
Title: Senior Vice President
