CONFORMED COPY
SUPPORT AGREEMENT dated as of April 19, 1998,
between KAPSON SENIOR QUARTERS CORP., a Delaware
corporation ("Parent"), KA ACQUISITION CORP., a
Delaware corporation ("Sub"), and the individuals and
other parties listed on Schedule A hereto (each, a
"Stockholder" and, collectively, the "Stockholders").
WHEREAS, Parent, Sub and Atria Communities, Inc., a Delaware
corporation (the "Company"), propose to enter into an Agreement and Plan of
Merger dated as of the date hereof (as the same may be amended or
supplemented, the "Merger Agreement"; capitalized terms used but not
defined herein shall have the meanings set forth in the Merger Agreement)
providing for the merger of Sub with and into the Company; and
WHEREAS each Stockholder owns the number of shares of Common
Stock set forth opposite his, her or its name on Schedule A hereto (such
shares of Common Stock, together with any other shares of capital stock of
the Company acquired by such Stockholder after the date hereof and during
the term of this Agreement, being collectively referred to herein as the
"Subject Shares" of such Stockholder); and
WHEREAS, as a condition to its willingness to enter into the
Merger Agreement, Parent has requested that each Stockholder enter into
this Agreement.
NOW, THEREFORE, the parties hereto agree as follows:
SECTION 1. Representations and Warranties of each Stockholder.
Each Stockholder hereby, severally and not jointly, represents and warrants
to Parent and Sub as of the date hereof in respect of himself, herself or
itself as follows:
(a) Authority; Execution and Delivery; Enforceability. The
Stockholder has all requisite power and authority to execute this Agreement
and to consummate the transactions contemplated hereby. The Stockholder has
duly executed and delivered this Agreement, and this Agreement constitutes
the legal, valid and binding obligation of the Stockholder, enforceable
against the Stockholder in accordance with its terms (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and
other similar laws affecting creditors' rights generally from time to time
in effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether considered in a proceeding in equity or at
law). The execution and delivery of this Agreement does not, and the
consummation of the transactions contemplated hereby and compliance with
the provisions of this Agreement will not, conflict with, or result in any
violation of, or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancelation or acceleration
of any obligation or to loss of a material benefit under, or result in the
creation of any Lien upon any of the properties or assets of the
Stockholder or any of its subsidiaries under, (i) any loan or credit
agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable to the
Stockholder or any of its subsidiaries or their respective
properties or assets or (ii) subject to the governmental filings and other
matters referred to in the following sentence, any judgment, order, decree,
statute, law, ordinance, rule or regulation applicable to the Stockholder
or any of its subsidiaries or their respective properties or assets, other
than, in the case of clauses (ii) and (iii), any such conflicts,
violations, defaults, rights, losses or Liens that individually or in the
aggregate would not (x) have a Material Adverse Effect on the Stockholder,
(y) impair the ability of the Stockholder to perform their respective
obligations under this Agreement or (z) prevent the consummation of any of
the Transactions. No consent, approval, order or authorization of, or
registration, declaration or filing with, any Governmental Entity is
required by or with respect to the Stockholder or any of its subsidiaries
in connection with the execution and delivery of this Agreement by the
Stockholder or the consummation by the Stockholder of transactions
contemplated hereby, except for the filing with the SEC of such reports
under Section 13(d) and 16(a) of the Exchange Act as may be required in
connection with the Agreement and the transactions contemplated hereby. If
the Stockholder is married and the Subject Shares of the Stockholder
constitute community property or otherwise need spousal or other approval
to be legal, valid and binding, this Agreement has been duly authorized,
executed and delivered by, and constitutes a valid and binding agreement
of, the Stockholder's spouse, enforceable against such spouse in accordance
with its terms. No trust of which the Stockholder is a trustee requires the
consent of any beneficiary to the execution and delivery of this Agreement
or to the consummation of the transactions contemplated hereby. The
Stockholder will execute a power of attorney in favor of at least two other
Stockholders with respect to the matters covered by Sections 3(a) and 3(b)
in the event of incapacity of the Stockholder.
(b) The Subject Shares. The Stockholder is the record and
beneficial owner of, or is the trustee of a trust that is the record holder
of, and whose beneficiaries are the beneficial owners of, and has good and
marketable title to, the Subject Shares set forth opposite his, her or its
name on Schedule A attached hereto, free and clear of any Liens. The
Stockholder does not own, of record or beneficially, any shares of capital
stock of the Company other than the Subject Shares set forth opposite his
or its name on Schedule A attached hereto. The Stockholder has the sole
right to vote such Subject Shares, and none of such Subject Shares is
subject to any voting trust or other agreement, arrangement or restriction
with respect to the voting of such Subject Shares, except as contemplated
by this Agreement.
SECTION 2. Representations and Warranties of Parent. Parent and
Sub hereby represent and warrant to each Stockholder as follows: Parent and
Sub have all requisite corporate power and authority to enter into this
Agreement and to consummate the Transactions. The execution and delivery of
this Agreement and the consummation of the Transactions have been duly
authorized by all necessary corporate action on the part of Parent and Sub.
This Agreement has been duly executed and delivered by Parent and Sub and
constitutes a valid and binding obligation of such party, enforceable
against such party in accordance with its terms (subject to applicable
bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and
other similar laws affecting creditors' rights generally from time to time
in effect and to general principles of equity, including, without
limitation, concepts of materiality, reasonableness, good faith and fair
dealing, regardless of whether considered in a proceeding in equity or at
law). The execution and delivery of the Operative Agreements do not, and
the consummation of the Transactions and compliance with the provisions of
the Operative Agreements will not, conflict with, or result in any
violation of, or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancelation or acceleration
of any obligation or to loss of a material benefit under, or result in the
creation of any Lien upon any of the properties or assets of Parent or Sub
under, (i) the certificate of incorporation or by-laws (or other comparable
organizational documents) of Parent or Sub, (ii) any loan or credit
agreement, note, bond, mortgage, indenture, lease or other agreement,
instrument, permit, concession, franchise or license applicable to Parent
or Sub or their respective properties or assets or (iii) subject to the
governmental filings and other matters referred to in the following
sentence, any judgment, order, decree, statute, law, ordinance, rule or
regulation applicable to Parent or Sub, other than, in the case of clauses
(ii) and (iii), any such conflicts, violations, defaults, rights, losses or
Liens that individually or in the aggregate would not (x) have a Material
Adverse Effect on Parent, (y) impair the ability of Parent and Sub to
perform their respective obligations under this Agreement or (z) prevent
the consummation of any of the Transactions. No consent, approval, order or
authorization of, or registration, declaration or filing with, any
Governmental Entity is required by or with respect to Parent or Sub in
connection with the execution and delivery of this Agreement or the
consummation by Parent or Sub, as the case may be, of any of the
Transactions, except for (i) the filing with the SEC of the Proxy Materials
and such reports under Sections 13 and 16(a) of the Exchange Act as may be
required in connection with the Operative Agreement and the Transactions,
(ii) the filing of the Certificate of Merger with the Delaware Secretary of
State and appropriate documents with the relevant authorities of other
states in which the Company is qualified to do business, (iii) such filings
as may be required in connection with the taxes described in Section 6.10
of the Merger Agreement and (iv) such other consents, approvals, orders,
authorizations, registrations, declarations and filings as may be required
under the "takeover" or "blue sky" laws of various states.
SECTION 3. Covenants of each Stockholder. Subject to Section 5
hereof, each Stockholder, severally and not jointly, covenants and agrees
as follows:
(a) The Stockholder hereby permits the Company, Parent and Sub to
publish and disclose in the Proxy Materials (including all documents and
schedules filed with the SEC) its identity and ownership of the Subject
Shares and the nature of its commitments, arrangements and understandings
under this Agreement.
(b) (1) At any meeting of the stockholders of the Company called
to seek the approval of the Merger Agreement and the Merger (the "Company
Stockholder Approval") or in any other circumstances upon which a vote,
consent or other approval with respect to the Merger Agreement, any other
Operative Agreement, the Merger or any other Transaction is sought, the
Stockholder shall vote (or cause to be voted) the Subject Shares of the
Stockholder in favor of granting the Company Stockholder Approval.
(2) The Stockholder hereby irrevocably grants to, and appoints,
Parent ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ and ▇▇▇▇▇ ▇. ▇▇▇▇▇, or any of them, and any
individual designated in writing by any of them, and each of them
individually, as the Stockholder's proxy and attorney-in-fact (with full
power of substitution), for and in the name, place and stead of the
Stockholder, to vote the Subject Shares of the Stockholder, or grant a
consent or approval in respect of the Subject Shares of the Stockholder in
a manner consistent with this Section 3. The Stockholder understands and
acknowledges that Parent is entering into the Merger Agreement in reliance
upon the Stockholder's execution and delivery of this Agreement. The
Stockholder hereby affirms that the irrevocable proxy set forth in this
Section 3(b) is given in connection with the execution of the Merger
Agreement, and that such irrevocable proxy is given to secure the
performance of the duties of the Stockholder under this Agreement. The
Stockholder hereby further affirms that the irrevocable proxy is coupled
with an interest and may under no circumstances be revoked, except as
provided herein. The Stockholder hereby ratifies and confirms all that
such irrevocable proxy may lawfully do or cause to be done by virtue
hereof. Such irrevocable proxy is executed and intended to be irrevocable
in accordance with the provisions of Section 212(e) of the DGCL. The
irrevocable proxy granted hereunder shall automatically terminate upon the
termination of Sections 3(b) and 3(c).
(c) At any meeting of stockholders of the Company or at any
adjournment thereof or in any other circumstances upon which the
Stockholder's vote, consent or other approval is sought, the Stockholder
shall vote (or cause to be voted) the Subject Shares against (i) any merger
agreement or merger (other than the Merger Agreement and the Merger),
consolidation, combination, sale of substantial assets, reorganization,
recapitalization, dissolution, liquidation or winding up of or by Company,
(ii) any takeover proposal (as defined in the Merger Agreement) and (iii)
any amendment of the certificate of incorporation or by-laws of the Company
or other proposal or transaction involving the Company or any of its
subsidiaries, which amendment or other proposal or transaction would in any
manner impede, frustrate, prevent or nullify any provision of any Operative
Agreement, the Merger or any other Transaction or change in any manner the
voting rights of any class of capital stock of the Company. The Stockholder
shall not commit or agree to take any action inconsistent with the
foregoing.
(d) Other than this Agreement, the Stockholder shall not (i)
sell, transfer, pledge, assign or otherwise dispose of (including by gift)
(collectively, "Transfer"), or enter into any Contract, option or other
arrangement (including any profit sharing arrangement) with respect to the
Transfer of, any Subject Shares to any person other than pursuant to the
Merger or (ii) enter into any voting arrangement, whether by proxy, voting
agreement or otherwise, with respect to any Subject Shares and shall not
commit or agree to take any of the foregoing actions.
(e) The Stockholder shall not, nor shall it authorize or permit
any employee of, or any investment banker, attorney or other adviser or
representative of, the Stockholder to, (i) directly or indirectly solicit,
initiate or encourage the submission of, any takeover proposal, (ii) enter
into any agreement with respect to any takeover proposal or (iii) directly
or indirectly participate in any discussions or negotiations regarding, or
furnish to any person any information with respect to, or take any other
action to facilitate any inquiries or the making of any proposal that
constitutes, or may reasonably be expected to lead to, any takeover
proposal. The Stockholder promptly shall advise Parent orally and in
writing of any takeover proposal or inquiry made to the Stockholder with
respect to or that could reasonably be expected to lead to any takeover
proposal and the material terms of any such takeover proposal or inquiry.
(f) The Stockholder shall use its reasonable efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with the other parties in doing, all things necessary,
proper or advisable to consummate and make effective, in the most
expeditious manner practicable, the Merger and the other Transactions.
(g) The Stockholder hereby consents to and approves the actions
taken by the Board of Directors of the Company in approving the Merger
Agreement, the Merger and the other Transactions. The Stockholder hereby
waives, and agrees not to exercise or assent, any appraisal rights under
Section 262 in connection with the Merger.
SECTION 4. [Intentionally Omitted]
SECTION 5. Termination. This Agreement shall terminate upon the
earliest of (i) the Effective Time, (ii) the termination of the Merger
Agreement in accordance with its terms and (iii) the Outside Date, other
than with respect to the liability of any party for breach hereof prior to
such termination.
SECTION 6. Additional Matters. (a) Each Stockholder shall, from
time to time, execute and deliver, or cause to be executed and delivered,
such additional or further consents, documents and other instruments as
Parent may reasonably request for the purpose of effectively carrying out
the transactions contemplated hereby.
(b) Concurrently with the Closing of the Merger, each of J.
▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇, and Parent shall
enter into the Shareholders and Registration Rights Agreement, in the form
attached as Exhibit A hereto.
(c) No Stockholder shall be deemed to make any agreement or
understanding herein in his or her capacity as a director or officer of the
Company. Each Stockholder signs solely in his, her or its capacity as the
record holder and beneficial owner of, or the trustee of a trust whose
beneficiaries are the beneficial owners of, such Stockholder's Subject
Shares and nothing herein shall limit or affect any actions taken by any
Stockholder in his capacity as an officer or director of the Company (to
the extent not specifically prohibited by the Merger Agreement).
SECTION 7. General Provisions.
(a) Amendments. This Agreement may not be amended except by an
instrument in writing signed by each of the parties hereto and consented to
by the Company.
(b) Notice. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered personally or sent by
overnight courier (providing proof of delivery) to Parent in accordance
with Section 9.02 of the Merger Agreement and to the Stockholders at their
respective addresses set forth on Schedule A hereto (or at such other
address for a party as shall be specified by like notice).
(c) Interpretation. When a reference is made in this Agreement to
Sections, such reference shall be to a Section to this Agreement unless
otherwise indicated. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Wherever the words "include", "includes"
or "including" are used in this Agreement, they shall be deemed to be
followed by the words "without limitation".
(d) Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule or
law, or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any party. 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 of the
parties as closely as possible in an acceptable manner to the end that
transactions contemplated hereby are fulfilled to the extent possible.
(e) Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement.
This Agreement shall become effective against Parent when one or more
counterparts have been signed by Parent and delivered to each Stockholder.
This Agreement shall become effective against any Stockholder when one or
more counterparts have been executed by such Stockholder and delivered to
Parent. Each party need not sign the same counterpart.
(f) Entire Agreement; No Third-Party Beneficiaries. This
Agreement (i) constitutes the entire agreement and supersedes all prior
agreements and understandings, both written and oral, among the parties
with respect to the subject matter hereof and (ii) is not intended to
confer upon any person other than the parties hereto (and, with respect to
Section 7(a) and (h) only, the Company) any rights or remedies hereunder.
(g) Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware regardless
of the laws that might otherwise govern under applicable principles of
conflicts of law thereof.
(h) Assignment. 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, (i) by Parent or Sub without
the prior written consent of the Stockholder and the Company (except that
Parent or Sub may assign, in its sole discretion, its rights and
obligations hereunder to any affiliate of Parent, but no such assignment
shall relieve Parent or Sub of its obligations hereunder without the
consent of the Stockholder and the Company) or (ii) by any Stockholder
without the prior written consent of Parent and the Company, and any
purported assignment without such consent shall be void. Subject to the
preceding sentences, this Agreement will be binding upon, inure to the
benefit of, and be enforceable by, the parties and their respective
successors and permitted assigns.
(i) Enforcement. The parties agree that irreparable damage would
occur 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 the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement and to
enforce specifically the terms and provisions of this Agreement in any New
York state court, any Federal court located in the State of New York or the
State of Delaware or in any Delaware state court, this being in addition to
any other remedy to which they are entitled at law or in equity. In
addition, each of the parties hereto (i) consents to submit itself to the
personal jurisdiction of any New York state court, any Federal court
located in the State of New York or the State of Delaware or any Delaware
state court in the event any dispute arises out of this Agreement or any
Transaction, (ii) agrees that it will not attempt to deny or defeat such
personal jurisdiction by motion or other request for leave from any such
court, (iii) agrees that it will not bring any action relating to this
Agreement or any Transaction in any court other than a New York state
court, any Federal court sitting in the State of New York or the State of
Delaware or any Delaware state court and (iv) waives any right to trial by
jury with respect to any claim or proceeding related to or arising out of
this Agreement or any transaction contemplated hereby.
IN WITNESS WHEREOF, each party has duly executed this Agreement,
all as of the date first written above.
KAPSON SENIOR QUARTERS CORP.,
by
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
KA ACQUISITION CORP.,
by
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: President
Signature Page to Support Agreement dated as of April 19, 1998
STOCKHOLDERS:
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇▇▇▇▇▇ Austin
/s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
---------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
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W. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
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W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
/s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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▇▇▇▇ ▇. ▇▇▇▇▇▇▇
/s/ R. ▇▇▇▇ ▇▇▇▇▇
---------------------------------
R. ▇▇▇▇ ▇▇▇▇▇
/s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
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J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
SCHEDULE A
Number of Shares of
Name and Address of Stockholder Common Stock Owned
▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
* 5,000
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇.
* 20,500(1)
▇▇▇▇▇ ▇. ▇▇▇▇
* 7,000
▇▇▇▇▇▇ ▇. ▇▇▇▇
* 15,035(2)
W. ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
* 70,000(3)
W. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇
* 34,805(4)
▇▇▇▇ ▇. ▇▇▇▇▇▇▇
* 636,487
R. ▇▇▇▇ ▇▇▇▇▇
* 65,000
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
* 6,500
* c/o Atria Communities, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
(1) Includes 11,000 shares held as custodian.
(2) Includes 35 shares held as custodian, but excludes 2,000 shares by a
partnership in which he is a general partner and 6,000 shares held by
an estate of which he is the executor.
(3) Includes 10,000 shares held as a custodian.
(4) Includes 380 shares held as a custodian.