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Exhibit
10.1
VOTING AGREEMENT
VOTING AGREEMENT, dated as of December 20, 2006
(this " Agreement "), between NATIONAL HEALTHCARE
CORPORATION, a Delaware corporation (" Parent "), and
NATIONAL HEALTH REALTY, INC., a Maryland corporation ("
Company "), and each stockholder of Parent and Company whose
name and signature is set forth on the signature page hereof
(collectively, the " Stockholders ," and each, a "
Stockholder ").
WHEREAS, Davis Acquisition Sub LLC, a Delaware
corporation and a wholly-owned subsidiary of NHC/OP (" Merger
Subsidiary "), NHC/OP, L.P., a Delaware limited partnership ("
NHC/OP "), Parent and Company are, concurrently with the
execution hereof, entering into an Agreement and Plan of Merger
(the " Merger Agreement ");
WHEREAS, pursuant to the Merger Agreement, a
successor to Company will merge with and into Merger Subsidiary,
with Merger Subsidiary being the surviving entity (the "
Merger "), and upon the consummation of the Merger each
share of common stock of the successor to Company, par value $0.01
per share, will be converted into the right to receive the Merger
Consideration;
WHEREAS, each Stockholder is the record and/or
beneficial owner of such number of shares of common stock of
Parent, par value $0.01 per share (the " Parent Common Stock
"), or shares of common stock of Company, par value $0.01 per share
(the " Company Common Stock ") as the case may be, as is set
forth opposite such Stockholder’s name on Schedule I hereof
(collectively, the " Existing Shares ");
WHEREAS, each Stockholder acknowledges that
Merger Subsidiary, NHC/OP, Parent and Company are entering into the
Merger Agreement in reliance on the representations, warranties,
covenants and other agreements of such Stockholder set forth in
this Agreement and would not enter into the Merger Agreement if
each such Stockholder did not enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing
and the respective representations, warranties, covenants and
agreements set forth herein and in the Merger Agreement, and
intending to be legally bound hereby, Parent, Company and each
Stockholder agree as follows:
1. Defined
Terms . Capitalized terms used herein without definition
shall have the meanings assigned to such terms in the Merger
Agreement. The following words have the meanings given to them
below.
" beneficial ownership " has the meaning
set forth in Rule 13d-3 under the Exchange Act.
" Consolidation " means the consolidation
of Company with its wholly-owned subsidiary pursuant to the
Articles of Consolidation, as a result of which a new Maryland
corporation shall be formed which (i) shall assume the corporate
name "National Health Realty, Inc.," (ii) shall have as its
outstanding stock only the stock of Company outstanding immediately
prior to the effectiveness of such consolidation, and (iii) shall
succeed to the business, properties, assets and rights and become
subject to all of the obligations and liabilities of Company,
including the Merger Agreement.
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" Exchange Act " means the Securities
Exchange Act of 1934, as amended.
" person " has the meaning specified in
Sections 3(a)(9) and 13(d)(3) of the Exchange Act.
" Representative " with respect to
any person who is an individual, any affiliate of such person
(including any family member or any entity controlled by such
person), or any agent, representative or advisor of such person,
including any investment banker, attorney or accountant retained by
such person or any of such person’s affiliates.
" Shares " means, (i) with respect to each
Stockholder of Company, all Existing Shares of such Stockholder
that are shares of Company Common Stock, and any shares of Company
Common Stock, beneficial ownership of which is acquired by such
Stockholder after the date hereof, including, without limitation,
shares acquired by purchase or upon the exercise, conversion or
exchange of any option, warrant or convertible security, and (ii)
with respect to each Stockholder of Parent, all Existing Shares of
such Stockholder that are shares of Parent Common Stock, and any
shares of Parent Common Stock, beneficial ownership of which is
acquired by such Stockholder after the date hereof, including
without limitation, shares acquired by purchase or upon the
exercise, conversion or exchange of any option, warrant or
convertible security.
" Support Documents " means this Agreement
and all other agreements, instruments and other documents executed
and delivered by each Stockholder in connection with this
Agreement.
" Termination Time " means the earliest of
the following: (i) the time at which Parent and Company give joint
written notice to each of the Stockholders that the Termination
Time has occurred; (ii) the Effective Time; and (iii) the
time at which the Merger Agreement terminates pursuant to Section
7.01 thereof.
" Voting Shares " means, (i) with respect
to each Stockholder of Company, such Stockholder’s Shares,
not including Shares that are the subject of unexercised options,
warrants, rights or convertible securities, and (ii) with respect
to each Stockholder of Parent, such Stockholder’s Shares, not
including Shares that are the subject of unexercised options,
warrants, rights or convertible securities.
2. Agreement to Vote .
(a) In order
to induce Merger Subsidiary and Parent to enter into the Merger
Agreement, each Stockholder of Company hereby agrees that, from and
after the date hereof and until the Termination Time, at any
meeting of the stockholders of Company, however called, or in
connection with any written consent of the stockholders of Company,
such Stockholder shall appear at each such meeting, in person or by
proxy, or otherwise cause such Stockholder’s Voting Shares to
be counted as present thereat for purposes of establishing a
quorum, and each such Stockholder shall vote (or cause to be voted)
or act by written consent with respect to all of its Voting Shares
that are beneficially owned by each such Stockholder or its
affiliates or as to which such Stockholder has, directly or
indirectly, the right to vote or direct the voting, (i) in
favor of adoption and approval of the Merger Agreement, the
Consolidation and the Merger and the approval of the terms thereof
and each of the other actions contemplated by the Merger Agreement
and this Agreement; (ii) against any action or agreement that
would result in a breach of any covenant, representation or
warranty or any other obligation or agreement of Company contained
in the Merger Agreement or of any Stockholder of Company contained
in this Agreement; (iii) against
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any Company Takeover Proposal; and
(iv) against any other action, agreement or transaction (other
than the Merger Agreement and the transactions contemplated
thereby) that is intended, or could reasonably be expected, to
impede, interfere or be inconsistent with, delay, postpone,
discourage or materially adversely affect the Consolidation, the
Merger or the performance by each of the Stockholders of Company of
such Stockholder’s obligations under this Agreement,
including, but not limited to (A) any extraordinary corporate
transaction, such as a merger, consolidation or other business
combination involving Company or any of its Subsidiaries (other
than the Consolidation or the Merger); (B) a sale, lease or
transfer of a material amount of assets of Company or any of its
Subsidiaries or a reorganization, recapitalization or liquidation
of Company or any of its Subsidiaries; (C) a material change
in the policies or management of Company; (D) an election of
new members to the board of directors of Company; (E) any
material change in the present capitalization or dividend policy of
Company or any amendment or other change to Company’s
articles of incorporation (other than as contemplated in the Merger
Agreement); or (F) any other material change in
Company’s corporate structure (other than as contemplated in
the Merger Agreement) or business. Each Stockholder of Company
hereby agrees that such Stockholder will not enter into any voting
or other agreement or understanding with any person or entity or
grant a proxy or power of attorney with respect to such
Stockholder’s Shares prior to the Termination Time (other
than a proxy or power of attorney to an officer of Parent that may
be exercised solely in accordance with this Section 2 and
except as provided in Section 3 below) or vote or give instructions
in any manner inconsistent with clauses (i), (ii), (iii) or (iv) of
the preceding sentence. Each Stockholder of Company hereby agrees,
during the period commencing on the date hereof and ending on the
Termination Time, not to vote or execute any written consent in
lieu of a stockholders meeting or vote, if such consent or vote by
the stockholders of Company would be inconsistent with or frustrate
the purposes of the other covenants of such Stockholder pursuant to
this paragraph.
(b) In order
to induce Company to enter into the Merger Agreement, each
Stockholder of Parent hereby agrees that, from and after the date
hereof and until the Termination Time, at any meeting of the
stockholders of Parent, however called, or in connection with any
written consent of the stockholders of Parent, such Stockholder
shall appear at each such meeting, in person or by proxy, or
otherwise cause such Stockholder’s Voting Shares to be
counted as present thereat for purposes of establishing a quorum,
and each such Stockholder shall vote (or cause to be voted) or act
by written consent with respect to all of its Voting Shares that
are beneficially owned by each such Stockholder or its affiliates
or as to which such Stockholder has, directly or indirectly, the
right to vote or direct the voting, (i) in favor of the
establishment and issuance of the Series A Convertible Preferred
Stock of Parent (including any related amendment to the certificate
of incorporation of Parent) pursuant to and in accordance with the
Merger Agreement and in favor of adoption and approval of this
Agreement; (ii) against any action or agreement that would result
in a breach of any covenant, representation or warranty or any
other obligation or agreement of any Stockholder of Parent
contained in this Agreement; and (iii) against any other action,
agreement or transaction that is intended, or could reasonably be
expected, to impede, interfere or be inconsistent with, delay,
postpone, discourage or materially adversely affect the performance
by each of the Stockholders of Parent of such Stockholder’s
obligations under this Agreement. Each Stockholder of Parent hereby
agrees that such Stockholder will not enter into any voting or
other agreement or understanding with any person or entity or grant
a proxy or power of attorney with respect to such
Stockholder’s Shares prior to the Termination Time (other
than a proxy or power of attorney to an officer of Company that may
be exercised solely in accordance with this Section 2 and except as
provided in Section 3 below) or vote or give instructions in any
manner inconsistent with clauses (i), (ii) or (iii) of the
preceding sentence. Each Stockholder of Parent hereby agrees,
during the period commencing on the date hereof and ending on the
Termination Time, not to vote or execute any written consent in
lieu of a
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stockholders meeting or vote, if such consent or
vote by the stockholders of Parent would be inconsistent with or
frustrate the purposes of the other covenants of such Stockholder
pursuant to this paragraph.
3. Proxy .
(a) As
security for its obligations under Section 2 hereof, each
Stockholder of Company hereby grants to, and appoints, Robert
Adams, Donald Daniel and John Lines, in their respective capacities
as officers of Parent, and any individual who shall hereafter
succeed to any such officer of Parent, and any other person
designated in writing by Parent, each of them individually, such
Stockholder’s proxy and attorney-in-fact (with full power of
substitution) to vote or act by written consent, to the fullest
extent permitted by and subject to applicable law, with respect to
such Stockholder’s Shares in accordance with Section 2
hereof. THIS PROXY IS COUPLED WITH AN INTEREST, SHALL BE
IRREVOCABLE AND SHALL TERMINATE AT THE TERMINATION TIME. Each
Stockholder of Company will take such further action or execute
such other instruments as may be necessary to effectuate the intent
of this proxy and hereby revokes any proxy previously granted by
such Stockholder with respect to such Stockholder’s
Shares.
(b) As
security for its obligations under Section 2 hereof, each
Stockholder of Parent hereby grants to, and appoints, Robert Adams,
Donald Daniel and John Lines, in their respective capacities as
officers of Company, and any individual who shall hereafter succeed
to any such officer of Company, and any other person designated in
writing by Company, each of them individually, such
Stockholder’s proxy and attorney-in-fact (with full power of
substitution) to vote or act by written consent, to the fullest
extent permitted by and subject to applicable law, with respect to
such Stockholder’s Shares in accordance with Section 2
hereof. THIS PROXY IS COUPLED WITH AN INTEREST, SHALL BE
IRREVOCABLE AND SHALL TERMINATE AT THE TERMINATION TIME. Each
Stockholder of Parent will take such further action or execute such
other instruments as may be necessary to effectuate the intent of
this proxy and hereby revokes any proxy previously granted by such
Stockholder with respect to such Stockholder’s
Shares.
4. Representations and Warranties of Parent . Parent
represents and warrants to each Stockholder as follows:
(a) Organization . Parent is a corporation duly organized,
validly existing and in good standing under the laws of the State
of Delaware.
(b) Authority; Enforceability . Parent has the requisite
corporate power and authority to enter into this Agreement and to
carry out its obligations hereunder. The execution and delivery of
this Agreement and the consummation of the transactions
contemplated hereby have been duly authorized by Parent’s
board of directors and no other corporate proceedings on the part
of Parent are necessary to authorize the execution and delivery of
this Agreement by Parent and the consummation by it of the
transactions contemplated hereby. This Agreement has been duly
executed and delivered by Parent and is a valid and legally binding
obligation of Parent, enforceable in accordance with its terms,
except as may be limited by bankruptcy, insolvency or other similar
laws affecting the rights and remedies of creditors generally, and
subject to general principles of equity, whether applied by a court
of law or equity.
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(c) No
Conflict . The execution and delivery of this Agreement by
Parent do not, and the performance of this Agreement by Parent will
not, (i) conflict with or violate the certificate of incorporation
or by-laws of Parent, (ii) conflict with or violate any law, rule,
regulation or order applicable to Parent or by which any of its
properties or assets is bound, or (iii) conflict with, 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 require paymen
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