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EXHIBIT 10.8
FORM OF STERLING HOUSE CORPORATION AFFILIATE AGREEMENT
__________ ___, 1997
Alternative Living Services
000 X. Xxxxxxxxxx Xxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxx 00000
Attention: Xx. Xxxxxxx X. Xxxxx
Affiliate Agreement
Ladies and Gentlemen:
Reference is made to the Agreement and Plan of Merger, dated as of July
___, 1997 (the "Merger Agreement"; capitalized terms used and not otherwise
defined herein are used herein as defined in the Merger Agreement), among
Alternative Living Services, a Delaware corporation ("Tango"), Tango Merger
Corporation, a Kansas corporation and a wholly owned subsidiary of Tango
("Merger Sub"), and Sterling House Corporation, a Kansas corporation
("Twister").
Pursuant to the terms of the Merger Agreement, at the Effective Time,
Merger Sub will be merged with and into Twister (the "Merger") and the
outstanding shares of Twister Common Stock will be converted into and become
exchangeable for shares of Tango Common Stock on the basis set forth in the
Merger Agreement. As a result of the Merger, the undersigned may receive shares
of Tango Common Stock ("Parent Securities").
The undersigned has been advised that as of the date hereof [it] [he]
[she] may be deemed to be an "affiliate" of Twister, as the term "affiliate" is
(i) defined for purposes of paragraphs (c) and (d) of rule 145 ("Rule 145") of
the rules and regulations (the "Rules and Regulations") of the Securities and
Exchange Commission (the "Commission") under the Securities Act of 1933, as
amended (the "Securities Act"), and/or (ii) used in and for purposes of
Accounting Series Releases 130 and 135, as amended, and Staff Accounting
Bulletins 65 and 76, of the Commission.
The undersigned hereby represents and warrants to and agrees with Tango
that:
1. The undersigned has full power and authority to execute and deliver
this letter and to make the representations and warranties set forth herein and
to perform [its] [his] [her] obligations hereunder;
2. The undersigned has carefully read this letter and the Merger
Agreement and discussed the requirements of such documents and other applicable
limitations upon [its] [his]
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[her] ability to sell, transfer or otherwise dispose of Parent Securities with
[its] [his] [her] counsel or counsel for Twister;
3. The undersigned will not make any sale, transfer or other
disposition of Parent Securities in violation of the Securities Act or the Rules
and Regulations;
4. The undersigned has been advised that the issuance of Parent
Securities to the undersigned pursuant to the Merger is being registered with
the Commission under the Securities Act on a Registration Statement on Form S-4.
However, the undersigned has also been advised that, since at the time the
Merger will be submitted for a vote of the stockholders of Twister the
undersigned may be deemed to be an affiliate of Twister and the distribution by
the undersigned of the Parent Securities has not been registered under the
Securities Act, the undersigned may not sell, transfer or otherwise dispose of
Parent Securities issued to [it] [him] [her] in the Merger unless (i) such sale,
transfer or other disposition has been registered under the Securities Act, (ii)
such sale, transfer or other disposition is made in conformity with the volume
and other limitations of Rule 145 or (iii) in the opinion of counsel reasonably
acceptable to Tango (it being understood that the law firms of Xxxxxx & Xxxxxx
LLP and Stroock & Stroock & Xxxxx LLP are deemed to be reasonably satisfactory
to Tango), such sale, transfer or other disposition is otherwise exempt from
registration under the Securities Act;
5. The undersigned understands that, except as may be provided in the
Merger Agreement or Stockholder Voting Agreement, Tango is under no obligation
to register the sale, transfer or other disposition of Parent Securities by the
undersigned or on [its] [his] [her] behalf under the Securities Act or to take
any other action necessary in order to make compliance with an exemption from
such registration available;
6. The undersigned also understands that stop transfer instructions
will be given to Tango's transfer agents with respect to Parent Securities and
that there will be placed on the certificates for Tango Common Stock issued to
[it] [him] [her], or any substitutions therefor, a legend stating in substance:
"THE SHARES EVIDENCED BY THIS CERTIFICATE WERE ISSUED IN A
TRANSACTION TO WHICH RULE 145 PROMULGATED UNDER THE SECURITIES ACT OF
1933, AS AMENDED, APPLIES. THE SHARES EVIDENCED BY THIS CERTIFICATE MAY
ONLY BE TRANSFERRED IN ACCORDANCE WITH THE TERMS OF THE AGREEMENT DATED
_________________, 1997 BETWEEN THE REGISTERED HOLDER HEREOF AND TANGO,
A COPY OF WHICH IS ON FILE AT THE PRINCIPAL OFFICES OF TANGO";
7. The undersigned also understands that, unless the sale, transfer or
other disposition by [it] [him] [her] of Parent Securities issued to [it] [him]
[her] has been registered under the Securities Act or is a sale made in
conformity with the provisions of Rule 145, Tango
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reserves the right to put the following legend on the certificates issued to any
transferee of the undersigned:
"THE SECURITIES EVIDENCED BY THIS CERTIFICATE WERE ACQUIRED
FROM A PERSON WHO RECEIVED SUCH SHARES IN A TRANSACTION TO WHICH RULE
145 PROMULGATED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, APPLIES,
AND WERE NOT ACQUIRED BY THE HOLDER WITH A VIEW TO, OR FOR RESALE IN
CONNECTION WITH, ANY DISTRIBUTION THEREOF WITHIN THE MEANING OF THE
SECURITIES ACT OF 1933, AS AMENDED. THE SECURITIES EVIDENCED BY THIS
CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED, AND MAY NOT BE SOLD, PLEDGED, OR OTHERWISE TRANSFERRED
EXCEPT IN ACCORDANCE WITH AN EXEMPTION.
8. The undersigned further represents to, and covenants with Tango
that, the undersigned has not, during the 30-day period immediately preceding
the Effective Time, engaged and will not engage, and after the Effective Time
until such time as results covering at least 30 days of combined operations of
Twister and Tango have been published by Tango, in the form of a quarterly
earnings report, an effective registration statement filed with the Commission,
a report to the Commission on Form 10-K, 10-Q, or 8-K, or any other public
filing or announcement which includes such combined results of operations, the
undersigned will not engage, in any sale, exchange, transfer, pledge,
disposition of or grant of any option, the establishment of any "short" or
put-equivalent position with respect to or the entry into of any similar
transaction intended to reduce the risk of the undersigned's ownership of, or
investment in, any of the following:
a. any Parent Securities, or any securities which may be paid
as a dividend or otherwise distributed thereon or with respect thereto
or issued or delivered in exchange or substitution therefore (all such
shares and other securities being referred to herein, collectively, as
"Restricted Securities"), or any option, right or other interest with
respect to any Restricted Securities;
b. any shares of Twister Common Stock or any options or
warrants to purchase shares of Twister Common Stock; or
c. any other shares of Tango Common Stock or any other equity
securities of Tango;
9. Except to the extent written notification to the contrary is
received by Tango from the undersigned prior to the Merger, the representations
contained herein will be true, complete and correct at all times from the date
hereof through the Closing Date.
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Tango hereby agrees that as promptly as practicable after the Effective
Time, Tango will publish results covering at least 30 days of combined
operations of Twister and Tango in the form of a quarterly earnings report, an
effective registration statement filed with the Commission, a report to the
Commission on Form 10-K, 10-Q, 8-K, or any other public filing or announcement
which includes such combined results of operations; provided, however, that
Tango will be under no obligation to publish any such financial information
other than with respect to a fiscal quarter of Tango.
It is understood and agreed that the legends set forth in paragraphs 6
and 7 above shall be removed by delivery of substitute certificates with such
legend if the undersigned shall have delivered to Tango a copy of a letter from
the staff of the Commission, or an opinion of counsel in form and substance
reasonably satisfactory to Tango, to the effect that such legend is not required
for purposes of the Act.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
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Execution of this agreement should not be considered an admission on
the part of the undersigned that [it] [he] [she] is an affiliate of Twister as
described above, or as a waiver of any rights the undersigned may have to object
to any claim that [it] [he] [she] is such an affiliate on or after the date of
this agreement.
Very truly yours,
[
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[AFFILIATE]]
[[AFFILIATE]
By:
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Name:
Title:]
ACCEPTED AND AGREED
as of __________ ___, 1997:
TANGO
By:
--------------------------
Name:
Title:
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