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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13E-3
RULE 13E-3 TRANSACTION STATEMENT
(Pursuant to Section 13(e) of the Securities Exchange Act of 1934)
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CONCENTRA MANAGED CARE, INC.
(Name of the Issuer)
Welsh, Carson, Anderson & Stowe, VIII, L.P.
Yankee Acquisition Corp.
John K. Carlyle
W. Tom Fogarty, M.D.
James M. Greenwood
Thomas E. Kiraly
Kenneth Loffredo
Richard A. Parr II
Daniel J. Thomas
Concentra Managed Care, Inc.
(Name of Person(s) Filing Statement)
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COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
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20589T103
(CUSIP Number of Class of Securities)
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Paul B. Queally
Yankee Acquisition Corp
c/o Welsh, Carson, Anderson & Stowe VIII, L.P.
320 Park Avenue
New York, New York 10022
(212) 893-9500
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Daniel J. Thomas
Concentra Managed Care, Inc.
312 Union Wharf
Boston, Massachusetts 02109
(617) 367-2163
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WITH COPIES TO:
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Robert A. Schwed, Esq.
Othon A. Prounis, Esq.
Reboul, MacMurray, Hewitt,
Maynard & Kristol
45 Rockefeller Plaza
New York, New York 10111
(212) 841-5700
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Richard A. Parr II
Concentra Managed Care, Inc.
5080 Spectrum Drive
Suite 400, West Tower
Addison, Texas 75001
(800) 232-3550
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Jeffrey A. Chapman, Esq.
Vinson & Elkins L.L.P.
3700 Trammell Crow Center
2001 Ross Avenue
Dallas, Texas 75201-2975
(214) 220-7795
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(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of Person(s) Filing Statement)
This statement is filed in connection with (check the appropriate box):
a. / X / The filing of solicitation materials or an
information statement subject to Regulation 14A,
Regulation 14C, or Rule 13e-3(c) under the Securities
Exchange Act of 1934.
b. / / The filing of a registration statement under the
Securities Act of 1933.
c. / / A tender offer.
d. / / None of the above.
Check the following box if the soliciting materials or information
statement referred to in checking box (a) are preliminary copies: /X/
CALCULATION OF FILING FEE
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TRANSACTION VALUATION (1) AMOUNT OF FILING FEE
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$ 792,505,929.90 $ 158,501.19
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/X/ Check box if any part of the fee is offset as provided by Rule 0-11(a)
(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number, or the form or schedule and the date of its filing.
Amount previously paid: $158,501.19
Form or registration no.: Schedule 14A - Preliminary
Proxy Statement
Filing Party: Concentra Managed Care, Inc.
Dated filed: March 31, 1999
(1) For purposes of calculating the fee only. Assumes purchase of
47,294,074 shares of common stock, par value $.01 per share, of Concentra
Managed Care, Inc. at $16.50 per share and the purchase of underlying options to
purchase Common Stock for an aggregate of $12,153,708.90
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This Rule 13e-3 transaction statement relates to the Amended and
Restated Agreement and Plan of Merger, dated as of March 24, 1999, by and among
Concentra Managed Care, Inc., a Delaware corporation, and Yankee Acquisition
Corp., a Delaware corporation, pursuant to which Yankee, currently a
wholly-owned subsidiary of Welsh, Carson, Anderson & Stowe VIII, L.P. ("WCAS"),
will be merged with and into Concentra, with Concentra surviving the merger.
WCAS VIII Associates LLC, a Delaware limited liability company, is the sole
general partner of WCAS. WCAS formed Yankee to consummate the merger.
Concurrently with the filing of this statement, Concentra is filing with the
Securities and Exchange Commission a preliminary proxy statement on Schedule 14A
under the Securities and Exchange Act of 1934, as amended, relating to a special
meeting of stockholders of Concentra. At such meeting, the stockholders of
Concentra will vote upon a proposal to approve the merger agreement.
A copy of the preliminary proxy statement is attached hereto as Exhibit
(d)(3). A copy of the merger agreement is attached as Appendix A to the
preliminary proxy statement.
Upon the terms and subject to the conditions of the merger agreement,
at the effective time of the merger:
o Yankee will be merged with and into Concentra, with Concentra
continuing as the surviving corporation.
o Each outstanding share of common stock of Concentra will be
converted into the right to receive $16.50 per share in cash,
other than shares held by stockholders who are entitled to and
have perfected their dissenters' appraisal rights.
o Shares of Concentra common stock held by Concentra, its
subsidiaries, and Yankee or its affiliates will be canceled in
the merger.
The effective time of the merger will be the date and time of the
filing of articles of merger with the Secretary of State of the State of
Delaware which is scheduled to occur as soon as practicable after satisfaction
or waiver of the conditions to the merger that are specified in the merger
agreement. It is anticipated that, if all conditions to the merger have been
satisfied or waived, the effective time will occur on the date of the special
meeting or as soon thereafter as practicable.
The following cross reference sheet is supplied pursuant to General
Instruction F to Schedule 13E-3 and shows the location in the preliminary proxy
statement of the information required to be included in this statement by
Schedule 13E-3. The information in the preliminary proxy statement, a copy of
which is attached hereto as Exhibit (d)(3), is hereby expressly incorporated
herein by reference and the responses to each item in this statement are
qualified in their entirety by the information contained in the preliminary
proxy statement. Capitalized terms used herein and not otherwise defined shall
have the meanings ascribed to such terms in the preliminary proxy statement. The
preliminary proxy statement will be completed and, if appropriate, amended,
prior to the time the definitive proxy statement is first sent or given to
stockholders of Concentra. This statement will be amended as necessary to
reflect the completion or amendment of the preliminary proxy statement.
Pursuant to Rule 13e-3, Concentra is filing this statement as issuer of
common stock which is the subject of this Rule 13e-3 transaction. The filing of
this statement shall not be construed as an admission by Concentra, WCAS, Yankee
or any of their affiliates, including Messrs. John K. Carlyle, Tom Fogarty,
M.D., James M. Greenwood, Thomas E. Kiraly, Kenneth Loffredo, Richard A Parr II
and Daniel J. Thomas, that Concentra is "controlled" by WCAS or that WCAS is an
"affiliate" of Concentra within the meaning of Rule 13e-3 under Section 13(e) of
the Securities Exchange Act of 1934, as amended.
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CROSS REFERENCE SHEET
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ITEM IN SCHEDULE 13E-3 CAPTION OR LOCATION IN THE PROXY STATEMENT
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Item 1(a) Cover Page, "Questions and Answers About the Merger" and "Summary--The
Companies"
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Item 1(b) Cover Page, "Summary--Record Date; Voting Power" and "The Special
Meeting--Record Date and Quorum Requirement"
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Item 1(c) - (d) "Summary--Historical Market Information" and "Purchases of Common Stock
by Certain Persons"
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Item 1(e) *
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Item 1(f) "Purchases of Common Stock by Certain Persons"
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Item 2(a) - (d) and (g) "Summary--The Companies", "Principal Stockholders and Stock Ownership of
Management and Others", "Certain Information Concerning Concentra" and
"Certain Information Concerning Yankee"
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Item 2(e) - (f) "Certain Information Concerning Concentra" and "Certain Information
Concerning Yankee"
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Item 3(a)(1) "Summary--Interests That Differ From Your Interests", "Special
Factors--Background of the Merger" and "--Interests of Certain Persons in
the Merger", and "Purchases of Common Stock By Certain Persons"
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Item 3(a)(2) "Questions and Answers About the Merger", "Summary--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "Special
Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendations", "--Purpose and Reasons of WCAS and the Members
of Management for the Merger", "--Interests of Certain Persons in the
Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"The Merger--Certain Terms of the Merger Agreement", and "Purchases of
Common Stock By Certain Persons"
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Item 3(b) "Questions and Answers About the Merger", "Summary--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "Special
Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendations", "--Purpose and Reasons of WCAS and the Members
of Management for the Merger", "Interests of Certain Persons in the
Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"The Merger--Certain Terms of the Merger
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</TABLE>
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<TABLE>
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ITEM IN SCHEDULE 13E-3 CAPTION OR LOCATION IN THE PROXY STATEMENT
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Agreement", "Certain Information Concerning Yankee" and "Purchases of
Common Stock By Certain Persons"
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Item 4(a) "Questions and Answers about the Merger", "Summary--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "--Dissenters'
Appraisal Rights", "Special Factors--Interests of Certain Persons in the
Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"The Special Meeting--Effective Time of the Merger and Payment for
Shares", "The Merger--Certain Terms of the Merger Agreement", "Rights of
Dissenting Stockholders" and Appendix A to the proxy statement
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Item 4(b) "Questions and Answers about the Merger", "Summary--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "--Appraisal
Rights", "Special Factors--Background of the Merger", "--Certain
Projections", "--The Special Committee's and the Board's Recommendation",
"--Purpose and Reasons of WCAS and the Members of Management for the
Merger", "--Interests of Certain Persons in the Merger", "--Certain
Effects of the Merger", "--Financing of the Merger", "The Merger--Certain
Terms of the Merger Agreement", "Rights of Dissenting Shareholders" and
Appendix A to the proxy statement
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Item 5(a) - (b) "Special Factors--Purpose and Reasons of WCAS and the Members of
Management for the Merger", "--Certain Effects of the Merger", and
"--Conduct of Concentra's Business After the Merger"
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Item 5(c) "Summary--Interests That Differ From Your Interests", "Special
Factors--Interests of Certain Persons in the Merger" and "--Conduct of
Concentra's Business After the Merger"
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Item 5(d) "Special Factors--Financing of the Merger", "Conduct of Concentra's
Business After the Merger", and "The Merger--Certain Terms of the Merger
Agreement"
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Item 5(e) "Questions and Answers About the Merger", "Summary--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "Special
Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendations", "--Purpose and Reasons of WCAS and the Members
of Management for the Merger", "--Interests of Certain Persons in the
Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"--Conduct of Concentra's Business After the Merger", and "The
Merger--Certain Terms of the Merger Agreement"
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Item 5(f) - (g) "Questions and Answers About the Merger" and "Special
Factors--Certain Effects of the Merger"
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</TABLE>
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<TABLE>
<CAPTION>
<S> <C>
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ITEM IN SCHEDULE 13E-3 CAPTION OR LOCATION IN THE PROXY STATEMENT
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Item 6(a) "Special Factors--Financing of the Merger"
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Item 6(b) "The Merger--Estimated Fees and Expenses of the Merger"
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Item 6(c) "Special Factors--Financing of the Merger"
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Item 6(d) *
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Item 7(a) - (c) "Questions and Answers about the Merger", "Summary", "Special
Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendation" and "--Purpose and Reasons of WCAS and the
Members of Management for the Merger"
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Item 7(d) "Questions and Answers about the Merger", "Summary", "Special
Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendation", "--Purpose and Reasons of WCAS and the Members
of Management for the Merger", "--Interests of Certain Persons in the
Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"--Conduct of Concentra's Business After the Merger", "Material Federal
Income Tax Consequences", "The Merger--Terms of the Merger Agreement" and
"--Estimated Fees and Expenses of the Merger" and "Rights of Dissenting
Stockholders"
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Item 8(a) "Questions and Answers about the Merger", "Summary-- Recommendations",
"Special Factors--The Special Committee's and the Board's
Recommendation", and "--Position of WCAS and the Members of Management as
to Fairness of the Merger"
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Item 8(b) "Questions and Answers about the Merger", "Summary--Recommendations",
"--Opinion of Concentra's Financial Advisor", "--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "--Dissenters'
Appraisal Rights", "--Historical Market Information", "--Selected
Consolidated Financial Data of the Company", "Certain Projections",
"Special Factors--Background of the Merger", "--The Special Committee's
and the Board's Recommendation", "--Opinion of Concentra's Financial
Advisor", "--Purpose and Reasons of WCAS and the Members of Management
for the Merger", "--Position of WCAS and the Members of Management as to
Fairness of the Merger", "--Interests of Certain Persons in the Merger",
"Certain Effects of the Merger", "The Special Meeting--Voting Procedures"
and "Rights of Dissenting Shareholders"
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</TABLE>
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<TABLE>
<CAPTION>
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ITEM IN SCHEDULE 13E-3 CAPTION OR LOCATION IN THE PROXY STATEMENT
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Item 8(c) "Questions and Answers about the Merger", "Summary--Voting Procedures",
"Special Factors--The Special Committee's and the Board's
Recommendation", "The Special Meeting--Voting Procedures" and "The
Merger--Terms of the Merger Agreement--Conditions to the Merger"
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Item 8(d) "Questions and Answers about the Merger", "Summary--Recommendations",
"--Opinion of Concentra's Financial Advisor", "Special
Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendation", "--Opinion of Concentra's Financial Advisor",
and "--Interest of Certain Persons in the Merger"
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Item 8(e) "Questions and Answers about the Merger", "Summary--Recommendations",
"Special Factors--Background of the Merger", "--The Special Committee's
and the Board's Recommendations"
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Item 8(f) "Special Factors -- Background of the Merger"
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Item 9(a) - (c) "Summary--Recommendations", "--Opinion of Concentra's Financial Advisor",
"Special Factors--Background of the Merger", "--The Special Committee's
and the Board's Recommendation", "--Opinion of Concentra's Financial
Advisor" and "--Conflicts of Interest" and Appendix B to the proxy
statement
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Item 10(a) - (b) "Special Factors--Interests of Certain Persons in the Merger", "Principal
Shareholders and Stock Ownership of Management and Others", and "Purchase
Of Common Stock By Certain Persons"
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Item 11 "Questions and Answers about the Merger", "Summary--The Companies",
"--Terms of the Merger Agreement", "--Interests That Differ From Your
Interests", "Special Factors--Background of the Merger", "--The Special
Committee's and the Board's Recommendation", "--Purpose and Reasons of
WCAS and the Members of Management for the Merger", "--Interests of
Certain Persons in the Merger", "--Certain Effects of the Merger",
"--Financing of the Merger", "The Merger--Certain Terms of the Merger
Agreement", "Certain Information Concerning Concentra ", "Certain
Information Concerning Yankee" and "Purchase of Common Stock by Certain
Persons" and Appendix A to the proxy statement.
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Item 12(a) - (b) "Summary--Recommendations" and "--Interests That Differ From Your
Interests", "Special Factors--The Special Committee's and the Board's
Recommendation", "--Purpose
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</TABLE>
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<TABLE>
<CAPTION>
<S> <C>
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ITEM IN SCHEDULE 13E-3 CAPTION OR LOCATION IN THE PROXY STATEMENT
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and Reasons of WCAS and the Members of Management for the Merger",
"--Position of WCAS and the Members of Management as to Fairness of the
Merger", "--Interests of Certain Persons in the Merger", "Certain
Information Concerning Concentra" and "Certain Information Concerning
Yankee"
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Item 13(a) "Summary--Dissenters' Appraisal Rights" "Rights of Dissenting
Shareholders" and Appendix A and Appendix C to the proxy statement
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Item 13(b) *
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Item 13(c) *
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Item 14(a) "Summary--Selected Consolidated Financial Data" "Incorporation of Certain
Documents by Reference" and "Independent Auditors"
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Item 14(b) "Summary--Consolidated Pro Forma Financial Statements (Unaudited)"
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Item 15(a) - (b) "Questions and Answers About the Merger" "Summary--Interests that Differ
From Your Interests", "Special Factors--Background of the Merger", "--The
Special Committee's and the Board's Recommendation", "--Interests of
Certain Persons in the Merger", "The Special Meeting--Proxy
Solicitation", "The Merger--Certain Terms of the Merger Agreement", and
"--Estimated Fees and Expenses of the Merger"
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Item 16 Proxy Statement
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Item 17(a) - (f) *
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*Not applicable or answer is negative.
</TABLE>
ITEM 1. ISSUER AND CLASS OF SECURITY SUBJECT TO THE TRANSACTION.
(a) The information set forth on the cover page to the proxy statement
and in the sections entitled "Questions and Answers About the Merger" and
"Summary--The Companies" of the proxy statement is incorporated herein by
reference.
(b) The information set forth on the cover page to the proxy statement
and in the sections entitled "Summary--Record Date; Voting Power" and "The
Special Meeting--Record Date and Quorum Requirement" of the proxy statement is
incorporated herein by reference.
(c) The information set forth in the sections entitled
"Summary--Historical Market Information" and "Purchases of Common Stock by
Certain Persons" of the proxy statement is incorporated herein by reference.
<PAGE>
(d) The information set forth in the sections entitled
"Summary--Historical Market Information" and "Purchases of Common Stock by
Certain Persons" of the proxy statement is incorporated herein by reference.
(e) Not applicable.
(f) The information set forth in the section entitled "Purchases of
Common Stock by Certain Persons"of the proxy statement is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a) - (d), (g) The information set forth in the sections entitled
"Summary--The Companies", "Principal Stockholders and Stock Ownership of
Management and Others," "Certain Information Concerning Concentra" and "Certain
Information Concerning Yankee" of the proxy statement is incorporated herein by
reference.
(e), (f) The information set forth in the sections entitled "Certain
Information Concerning Concentra" and "Certain Information Concerning Yankee" of
the proxy statement is incorporated herein by reference.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS.
(a) (1) The information set forth in the sections entitled
"Summary--Interests That Differ From Your Interests", "Special
Factors--Background of the Merger" and "--Interests of Certain Persons in the
Merger" and "Purchases of Common Stock By Certain Persons" of the proxy
statement is incorporated herein by reference.
(a) (2) (b) The information set forth in the sections entitled
"Questions and Answers About the Merger", "Summary--Terms of the Merger
Agreement", "Interests That Differ From Your Interests", "Special
Factors--Background of the Merger", "--The Special Committee's and the Board's
Recommendations", "--Purpose and Reasons of WCAS and the Members of Management
for the Merger", "--Interests of Certain Persons in the Merger", "--Certain
Effects of the Merger", "--Financing of the Merger", "The Merger--Certain Terms
of the Merger Agreement", and "Purchases of Common Stock By Certain Persons" of
the proxy statement is incorporated herein by reference.
(b) The information set forth in the sections entitled "Questions and
Answers About the Merger", "Summary--Terms of the Merger Agreement",
"--Interests That Differ From Your Interests", "Special Factors--Background of
the Merger", "--The Special Committee's and the Board's Recommendations",
"--Purpose and Reasons of WCAS and the Members of Management for the Merger",
"Interests of Certain Persons in the Merger", "--Certain Effects of the Merger",
"--Financing of the Merger", "The Merger--Certain Terms of the Merger Agreement"
"Certain Information Concerning Yankee" and "Purchases of Common Stock By
Certain Persons" of the proxy statement is incorporated herein by reference.
ITEM 4. TERMS OF THE TRANSACTION.
(a) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary--Terms of the Merger Agreement",
"--Interests That Differ From Your Interests", "--Dissenters' Appraisal Rights",
"Special Factors--The Special Committee's and the Board's Recommendation",
"--Purpose and Reasons of WCAS for the Merger", "--Interests of Certain Persons
in the Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"The Special Meeting--Effective Time of the Merger and Payment for Shares", "The
Merger--Certain Terms of the Merger Agreement", "Rights of Dissenting
Stockholders" and Appendix A of the proxy statement is incorporated herein by
reference.
(b) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary--Terms of the Merger Agreement",
"--Interests That Differ From Your Interests", "--Appraisal Rights", "Special
Factors--Background of the Merger", "--Certain Projections", "--The Special
Committee's and the Board's Recommendation", "--Purpose and Reasons of WCAS and
the Members of Management for the Merger", "--Interests of Certain Persons in
the Merger", "--Certain Effects of the Merger", "--Financing of the Merger",
"The Merger--Certain
<PAGE>
Terms of the Merger Agreement", "Rights of Dissenting Shareholders" and Appendix
A of the proxy statement is incorporated herein by reference.
ITEM 5. PLANS OR PROPOSALS OF THE ISSUER OR AFFILIATE.
(a) - (b) The information set forth in the sections entitled "Special
Factors--Purpose and Reasons of WCAS and the Members of Management for the
Merger", "--Certain Effects of the Merger", and "--Conduct of Concentra's
Business After the Merger" of the proxy statement is incorporated herein by
reference.
(c) The information set forth in the sections entitled
"Summary--Interests That Differ From Your Interests", "Special
Factors--Interests of Certain Persons in the Merger" and "--Conduct of
Concentra's Business After the Merger" of the proxy statement is incorporated
herein by reference.
(d) The information set forth in the sections entitled "Special
Factors--Financing of the Merger", "Conduct of Concentra's Business After the
Merger", and "The Merger--Certain Terms of the Merger Agreement" of the proxy
statement is incorporated herein by reference.
(e) The information set forth in the sections entitled "Questions and
Answers About the Merger", "Summary--Terms of the Merger Agreement",
"--Interests That Differ From Your Interests", "Special Factors--Background of
the Merger", "--The Special Committee's and the Board's Recommendations",
"--Purpose and Reasons of WCAS and the Members of Management for the Merger",
"--Interests of Certain Persons in the Merger", "--Certain Effects of the
Merger", "--Financing of the Merger", "--Conduct of Concentra's Business After
the Merger", and "The Merger--Certain Terms of the Merger Agreement" of the
proxy statement is incorporated herein by reference.
(f) - (g) The information set forth in the sections entitled "Questions
and Answers About the Merger" and "Special Factors--Certain Effects of the
Merger" of the proxy statement is incorporated herein by reference.
ITEM 6. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a) The information set forth in the section entitled "Special
Factors--Financing of the Merger" of the proxy statement is incorporated herein
by reference.
(b) The information set forth in the section entitled "The
Merger--Estimated Fees and Expenses of the Merger" of the proxy statement is
incorporated herein by reference.
(c) The information set forth in the sections entitled "Special
Factors--Financing of the Merger" of the proxy statement is incorporated herein
by reference.
(d) Not applicable.
ITEM 7. PURPOSE(S), ALTERNATIVES, REASONS AND EFFECTS.
(a) - (c) The information set forth in the sections entitled "Questions
and Answers about the Merger", "Summary", "Special Factors--Background of the
Merger", "-- Special Committee's and the Board's Recommendation", and "--Purpose
and Reasons of WCAS and the Members of Management for the Merger" of the proxy
statement is incorporated herein by reference.
(d) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary", "Special Factors--Background of the
Merger", "--The Special Committee's and the Board's Recommendation", "--Purpose
and Reasons of WCAS and the Members of Management for the Merger", "--Interests
of Certain Persons in the Merger", "--Certain Effects of the Merger",
"--Financing of the Merger", "--Conduct of Concentra's Business After the
Merger", "Material Federal Income Tax Consequences", "The Merger--Terms of the
Merger Agreement" and "--Estimated Fees and Expenses of the Merger" and "Rights
of Dissenting Stockholders" of the proxy statement is incorporated herein by
reference.
<PAGE>
ITEM 8. FAIRNESS OF THE TRANSACTION.
(a) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary-- Recommendations", "Special Factors--The
Special Committee's and the Board's Recommendation", and "--Position of WCAS and
the Members of Management as to Fairness of the Merger" of the proxy statement
is incorporated herein by reference.
(b) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary--Recommendations", "--Opinion of Concentra's
Financial Advisor", "--Terms of the Merger Agreement", "--Interests That Differ
From Your Interests", "--Dissenters' Appraisal Rights", "--Historical Market
Information", "--Selected Consolidated Financial Data of the Company", "Certain
Projections", "Special Factors--Background of the Merger", "--The Special
Committee's and the Board's Recommendation", "--Opinion of Concentra's Financial
Advisor", "--Purpose and Reasons of WCAS and the Members of Management for the
Merger", "--Position of WCAS and the Members of Management as to Fairness of the
Merger", "--Interests of Certain Persons in the Merger", "Certain Effects of the
Merger", "The Special Meeting--Voting Procedures" and "Rights of Dissenting
Shareholders" of the proxy statement is incorporated herein by reference.
(d) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary--Recommendations", "--Opinion of Concentra's
Financial Advisor", "Special Factors--Background of the Merger", "--The Special
Committee's and the Board's Recommendation", "--Opinion of Concentra's Financial
Advisor", and "--Interest of Certain Persons in the Merger" of the proxy
statement is incorporated herein by reference.
(e) The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary--Recommendations", "Special
Factors--Background of the Merger", "--The Special Committee's and the Board's
Recommendations" of the proxy statement is incorporated herein by reference.
(f) The information set forth in the section "Special
Factors--Background of the Merger" of the proxy statement is incorporated herein
by reference.
ITEM 9. REPORTS, OPINIONS, APPRAISALS AND CERTAIN NEGOTIATIONS.
(a) - (c) The information set forth in the sections entitled
"Summary--Recommendations", "--Opinion of Concentra's Financial Advisor",
"Special Factors--Background of the Merger", "--The Special Committee's and the
Board's Recommendation", "--Opinion of Concentra's Financial Advisor" and
"--Conflicts of Interest" and Appendix B of the proxy statement is incorporated
herein by reference.
ITEM 10. INTEREST IN SECURITIES OF THE ISSUER.
(a) - (b) The information set forth in the sections entitled "Special
Factors--Interests of Certain Persons in the Merger", "Principal Shareholders
and Stock Ownership of Management and Others", and "Purchase Of Common Stock By
Certain Persons" of the proxy statement is incorporated herein by reference.
ITEM 11. CONTRACTS, ARRANGEMENTS OR UNDERSTANDINGS WITH RESPECT TO THE ISSUER'S
SECURITIES.
The information set forth in the sections entitled "Questions and
Answers about the Merger", "Summary--The Companies", "--Terms of the Merger
Agreement", "--Interests That Differ From Your Interests", "Special
Factors--Background of the Merger", "--The Special Committee's and the Board's
Recommendation", "--Purpose and Reasons of WCAS and the Members of Management
for the Merger", "--Interests of Certain Persons in the Merger", "--Certain
Effects of the Merger", "--Financing of the Merger", "The Merger--Certain Terms
of the Merger Agreement", "Certain Information Concerning Concentra ", "Certain
Information Concerning Yankee" and "Purchase of Common Stock by Certain Persons"
and Appendix A of the proxy statement is incorporated herein by reference.
<PAGE>
ITEM 12. PRESENT INTENTION AND RECOMMENDATION OF CERTAIN PERSONS WITH REGARD TO
THE TRANSACTION.
(a) - (b) The information set forth in the sections entitled "Summary--
Recommendations" and "--Interests That Differ From Your Interests", "Special
Factors--The Special Committee's and the Board's Recommendation", "--Purpose and
Reasons of WCAS and the Members of Management for the Merger", "--Position of
WCAS and the Members of Management as to Fairness of the Merger", "--Interests
of Certain Persons in the Merger", and "Certain Information Concerning
Concentra" and "Certain Information Concerning Yankee" of the proxy statement is
incorporated herein by reference.
ITEM 13. OTHER PROVISIONS OF THE TRANSACTION.
(a) The information set forth in the sections entitled
"Summary--Dissenters' Appraisal Rights" "Rights of Dissenting Shareholders" and
Appendix A and Appendix C of the proxy statement is incorporated herein by
reference.
(b) Not applicable.
(c) Not applicable.
ITEM 14. FINANCIAL INFORMATION.
(a) The information set forth in the sections entitled
"Summary--Selected Consolidated Financial Data" "Incorporation of Certain
Documents by Reference" and "Independent Auditors" of the proxy statement is
incorporated herein by reference.
(b) The relevant financial information set forth under the section
entitled "Summary--Selected Consolidated Financial Data" of the proxy statement
is incorporated herein by reference.
ITEM 15. PERSONS AND ASSETS EMPLOYED, RETAINED OR UTILIZED.
(a) - (b) The information set forth in the sections entitled "Questions
and Answers About the Merger" "Summary--Interests that Differ From Your
Interests", "Special Factors--Background of the Merger", "--The Special
Committee's and the Board's Recommendation", "--Interests of Certain Persons in
the Merger", "The Special Meeting--Proxy Solicitation", "The Merger--Certain
Terms of the Merger Agreement", and "--Estimated Fees and Expenses of the
Merger" of the proxy statement is incorporated herein by reference.
ITEM 16. ADDITIONAL INFORMATION.
The entirety of the proxy statement is incorporated herein by
reference.
ITEM 17. MATERIAL TO BE FILED AS EXHIBITS.
- --------------------------------------------------------------------------------
EXHIBIT NO. DESCRIPTION
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(a)(1) Commitment Letter dated February 26, 1999 from Chase
Securities Inc., The Chase Manhattan Bank, DLJ Capital
Funding, Inc., Credit Suisse First Boston and Fleet
National Bank.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(a)(2) Letter dated February 24, 1999 from Chase Capital
Partners.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(a)(3) Letter dated March 1, 1999 from WCAS Capital Partners III,
L.P.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(b)(1) Opinion of BT Alex. Brown Incorporated dated March 2, 1999
(included as Appendix B to the Preliminary Proxy
Statement, which is filed herewith as Exhibit (d)(3)).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(c)(1) Agreement and Plan of Merger dated as of March 24, 1999 by
and between Yankee
- --------------------------------------------------------------------------------
<PAGE>
- --------------------------------------------------------------------------------
EXHIBIT NO. DESCRIPTION
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
Acquisition Corp. and Concentra Managed Care, Inc.
(included as Appendix A to the Preliminary Proxy
Statement, which is filed herewith as Exhibit (d)(3)).
- --------------------------------------------------------------------------------
(c)(2) Contribution Letter dated March 24, 1999 by Welsh, Carson,
Anderson & Stowe VIII, L.P.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(c)(3) Stock Subscription Agreement dated as of March 24, 1999 by
Ferrer Freeman Thompson & Co. on behalf of Health Care
Capital Partners L.P. and on behalf of Health Care
Executive Partners and Yankee Acquisition Corp.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(1) Letter to Stockholders (included in the Preliminary Proxy
Statement, which is filed herewith as Exhibit (d)(3)).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(2) Notice of Special Meeting of Stockholders (included in the
Preliminary Proxy Statement, which is filed herewith as
Exhibit (d)(3)).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(3) Preliminary Proxy Statement (incorporated by reference to
the Schedule 14A filed by Concentra on June 7, 1999).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(4) Form of Proxy (included in the Preliminary Proxy
Statement, which is filed herewith as Exhibit (d)(3)).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(5) Press Release issued by Concentra Managed Care, Inc. dated
as of April 28, 1999 (incorporated by reference to the
Current Report on Form 8-K filed by Concentra on April 28,
1999).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(6) Press Release issued by Concentra Managed Care, Inc. dated
as of March 3, 1999 (incorporated by reference to the
Current Report on Form 8-K filed by Concentra on March 3,
1999).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(d)(7) Press Release issued by Concentra Managed Care, Inc. dated
as of March 25, 1999 (incorporated by reference to the
Current Report on Form 8-K filed by Concentra on March 29,
1999).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(e) Text of Section 262 of the Delaware General Corporation
Law (included as Appendix C to the Preliminary Proxy
Statement, which is filed herewith as Exhibit (d)(3)).
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
(f) Not applicable.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
99.1 Powers of Attorney.
- --------------------------------------------------------------------------------
<PAGE>
SIGNATURES
After due inquiry and to the best of our knowledge and belief, each of
the undersigned certifies that the information set forth in this Statement is
true, complete and correct.
CONCENTRA MANAGED CARE, INC.
By: /s/Daniel J. Thomas*
-----------------------------------
Daniel J. Thomas
Dated: President
YANKEE ACQUISITION CORP.
By: /s/Paul B. Queally
-----------------------------------
Paul B. Queally
Dated: President
WELSH, CARSON, ANDERSON & STOWE, VIII, L.P.
By: WCAS VIII Associates, LLC, General Partner
By: /s/Paul B. Queally
-----------------------------------
Paul B. Queally
Dated: Managing Member
JOHN K. CARLYLE
/s/ John K. Carlyle*
Dated: --------------------------------------------------
W. TOM FOGARTY, M.D.
/s/ W. Tom Fogarty, M.D.*
Dated: --------------------------------------------------
JAMES M. GREENWOOD
/s/ James M. Greenwood*
Dated: --------------------------------------------------
THOMAS E. KIRALY
/s/ Thomas E. Kiraly*
Dated: --------------------------------------------------
KENNETH LOFFREDO
/s/ Kenneth Loffredo*
Dated: --------------------------------------------------
RICHARD A. PARR II
/s/ Richard A. Parr II
Dated: --------------------------------------------------
DANIEL J. THOMAS
/s/ Daniel J. Thomas*
Dated: --------------------------------------------------
*The undersigned, by signing his name hereto, does sign and execute this
Schedule 13E-3 as of this 6th day of June, 1999 pursuant to the Powers of
Attorney executed on behalf of the above-named officers and directors and
contemporaneously filed herewith with the Securities and Exchange Commission
By: /s/ Richard A. Parr II
--------------------------------------------------
Richard A. Parr II
Attorney-in-Fact
EXHIBIT (A)(1)
CHASE SECURITIES INC.
THE CHASE MANHATTAN BANK
270 Park Avenue
New York, New York 10017
DLJ CAPITAL FUNDING, INC.
277 Park Avenue
New York, New York 10172
CREDIT SUISSE FIRST BOSTON
Eleven Madison Avenue
New York, New York 10010-3629
FLEET NATIONAL BANK
One Federal Street
Boston, Massachusetts 02110
February 26, 1999
$475,000,000
SENIOR SECURED CREDIT FACILITIES
COMMITMENT LETTER
Welsh, Carson, Anderson & Stowe VIII, L.P.
320 Park Avenue
Suite 2500
New York, New York 10022-6815
Attention: Andrew M. Paul
Paul B. Queally
D. Scott Mackesy
Gentlemen:
You have advised Chase Securities Inc. ("CSI"), The Chase Manhattan
Bank ("CHASE"), DLJ Capital Funding, Inc. ("DLJ"), Credit Suisse First Boston
("CSFB") and Fleet National Bank ("FLEET"; together with Chase, DLJ and CSFB,
the "UNDERWRITERS") that you, together with your affiliates (collectively,
"WCAS") will form a new corporation ("NEWCO") for the purpose of effecting the
recapitalization (the "ACQUISITION") of Concentra Managed Care, Inc.
("CONCENTRA"). The Acquisition will be effected by a merger of Newco with and
into Concentra, as a result of which WCAS will own 93% of the common stock of
Concentra and the existing stockholders will own 7% of such common stock. The
existing stockholders of Concentra, other than WCAS, will receive cash
consideration in exchange for the remainder of their common stock in Concentra.
Alternatively, in the event that WCAS and Concentra so agree, WCAS will form a
new corporation ("NEWCO I") and other investors selected by WCAS and
satisfactory to the Underwriters (collectively, the "OTHER INVESTOR") will form
a new corporation ("NEWCO II"), and the Acquisition will be effected by Newco I
and Newco II being merged with and into Concentra, as a result of which WCAS and
the Other Investor will own 93% and 7%, respectively, of the common stock of
Concentra and the other existing stockholders of Concentra will receive cash for
all their existing common stock of Concentra. For purposes hereof, any such
alternate transaction (the
1
<PAGE>
"ALTERNATE TRANSACTION") is also referred to as the "Acquisition." Immediately
after the Acquisition, Concentra will contribute (the "CONTRIBUTION") all of its
assets, including the stock of its direct subsidiaries, to a newly created
wholly-owned subsidiary (the "Borrower"). In connection with the Acquisition and
the Contribution, approximately $328,000,000 of the existing indebtedness of
Concentra will be refinanced (the "REFINANCING"; together with the Acquisition
and the Contribution, the "TRANSACTIONS").
In connection with the Transactions, you have advised us that you
propose to finance such Transactions with (i) senior secured credit facilities
in an aggregate amount of up to $475,000,000 (the "FACILITIES") of the Borrower,
comprise of term loan facilities aggregating $375,000,000 (the "TERM
FACILITIES") and a $100,000,000 revolving credit facility (the "REVOLVING
FACILITY"), (ii) senior subordinated financing in an aggregate amount of
$190,000,000 of the Borrower on terms and conditions acceptable to the Agents
(as defined below), (iii) senior unsecured pay-in-kind notes of $110,200,000
issued by Concentra and (iv) common equity in Newco consisting of $288,500,000
in new cash equity contributed by WCAS and $59,100,000 of shares of common stock
of Concentra held by WCAS. After giving effect to the Acquisition, the existing
stockholders will own common equity of Concentra having a value of $30,600,000.
(In the event of the Alternative Acquisition, the Other Investor would invest
$30,600,000 in the common equity of Newco II). The Revolving Facility will be
used to finance the continuing operations, working capital needs and general
corporate purposes of the Borrower and its subsidiaries, including acquisitions
and investments in other entities subject to restrictions and limitations to be
approved by CSI and the Underwriters.
CSI is pleased to advise you that it is willing to act as advisor,
co-lead arranger and joint book manager for the Facilities (in such capacity, a
"CO-LEAD ARRANGER"), and Chase is pleased to advise you that it is willing to
serve as administrative agent for the Facilities (in such capacity, the
"ADMINISTRATIVE AGENT"). In addition, DLJ is pleased to advise you that it is
willing to act as co-lead arranger (a "CO-LEAD ARRANGER"), joint book manager
and syndication agent for the Facilities (in such capacity, the "SYNDICATION
AGENT"; together with the Administrative Agent, collectively, the "AGENTS").
Furthermore, each of Chase and DLJ is pleased to advise you of its commitment to
provide up to $166,250,000 of the Facilities and each of CSFB and Fleet is
pleased to advise you that it is willing to act as co-documentation agent (each,
in such capacity, a "CO-DOCUMENTATION AGENT") and of its commitment to provide
up to $71,250,000 of the Facilities, in each case upon the terms and subject to
the conditions set forth or referred to in this commitment letter (the
"COMMITMENT Letter") and in the Summary of Terms and Conditions attached hereto
as Exhibit A (the "TERM SHEET").
It is agreed that CSI and DLJ will act as the Co-Lead Arrangers, that
Chase will act as the Administrative Agent, that DLJ will act as the Syndication
Agent, for the Facilities and that CSFB and Fleet will act as the
Co-Documentation Agents. You agree that no other agents, co-agents or arrangers
will be appointed, no other titles will be awarded and no compensation (other
than that expressly contemplated by the Term Sheet and the Fee Letters referred
to below) will be paid in connection with the Facilities unless you and CSI and
Chase shall so agree.
CSI and Chase intend to syndicate the Facilities to a group of
financial institutions (together with the Underwriters, the "LENDERS")
identified by CSI and Chase in consultation with you. CSI and Chase intend to
commence syndication efforts promptly upon your entering into definitive
documentation with respect to the Acquisition, and you agree actively to assist
CSI and Chase in completing a syndication satisfactory to them. Such assistance
shall include (a) your using commercially reasonable efforts to ensure that the
syndication efforts benefit materially from the existing lending relationships
of WCAS, Concentra and the Borrower, (b) direct contact between senior
management and advisors of WCAS, Concentra and the Borrower and the proposed
Lenders, (c) assistance in the preparation of a Confidential Information
Memorandum and other marketing materials to be used in connection with the
syndication and (d) the hosting, with CSI and Chase, of one or more meetings of
prospective Lenders.
CSI and Chase will manage all aspects of the syndication of the
Facilities, including decisions as to the selection of institutions to be
approached and when they will be approached, when their commitments will be
accepted, which institutions will participate, the allocations of the
commitments among the Lenders and the amount and distribution of fees among the
Lenders in consultation with you. To assist CSI and Chase in their syndication
efforts, you agree promptly to prepare and provide to CSI and Chase all
information with respect to WCAS, the Borrower, the Transactions
2
<PAGE>
and the other transactions contemplated hereby and to obtain the agreement of
Concentra to prepare and provide all information with respect to it, in each
case, including all reasonable financial information and projections (the
"PROJECTIONS"), as we may reasonably request in connection with the arrangement
and syndication of the Facilities. You hereby represent and covenant that, to
your knowledge, (a) all information other than the Projections (the
"INFORMATION") that has been or will be made available to CSI and the
Underwriters by you or any of your representatives is or will be, when
furnished, complete and correct in all material respects and does not or will
not, when furnished, contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements contained
therein not materially misleading in light of the circumstances under which such
statements are made and (b) the Projections that have been or will be made
available to CSI and the Underwriters by you or any of your representatives have
been or will be prepared in good faith based upon assumptions that you believe
in good faith to be reasonable. CSI and the Underwriters understand that
Concentra is not your representative. You understand that in arranging and
syndicating the Facilities we may use and rely on the Information and
Projections without independent verification thereof.
As consideration for the commitments of the Underwriters hereunder and
the agreements of the Agents to perform the services described herein, you agree
to pay, and to cause the Borrower to pay, the nonrefundable fees set forth in
Annex I to the Term Sheet and in the Underwriters Fee Letter and the
Administrative Agent Administration Fee Letter, each dated the date hereof and
delivered herewith (collectively, the "FEE LETTERS").
CSI and Chase shall be entitled, after consultation with you, DLJ, CSFB
and Fleet to change the pricing, terms, structure or amounts of any of the
Facilities if the syndication has not been completed and if CSI and Chase
reasonably determine that such changes are advisable to ensure a successful
syndication of the Facilities; provided the total amount of the Facilities
remains unchanged.
The commitments hereunder and the agreements to perform the services
described herein are subject to (a) there not occurring or becoming known to us
any material adverse condition or material adverse change in or affecting the
business, operations, property, condition (financial or otherwise) or prospects
of Concentra and its subsidiaries, taken as a whole since December 31, 1997, (b)
our not becoming aware after the date hereof of any information or other matter
affecting Concentra, the Borrower or the transactions contemplated hereby which
is inconsistent in a material and adverse manner with any such information or
other matter disclosed to us prior to the date hereof, (c) there not having
occurred a material disruption of or material adverse change in financial,
banking or capital market conditions that, in the judgment of CSI and Chase,
could materially impair the syndication of credit facilities similar or
comparable to the Facilities, (d) our satisfaction that prior to and during the
syndication of the Facilities there shall be no competing offering, placement or
arrangement of any debt securities or bank financing by or on behalf of WCAS,
Concentra or the Borrower or any of their respective affiliates (except for any
such debt securities as contemplated hereby and for any debt securities or bank
financing by or on behalf of WCAS and its other affiliates as are coordinated
with the syndication of the Facilities in consultation with CSI and Chase), (e)
the negotiation, execution and delivery of definitive documentation with respect
to the Facilities satisfactory to CSI, the Underwriters and their respective
counsels, and the closing of the transactions thereunder and the Transactions on
or before August 31, 1999, and (f) the other conditions set forth or referred to
in the Term Sheet.
You agree (a) to indemnify and hold harmless CSI, Chase, DLJ, CSFB and
Fleet, their respective affiliates and their respective officers, directors,
employees, advisors, and agents (each, an "INDEMNIFIED person") from and against
any and all losses, claims, damages and liabilities to which any such
indemnified person may become subject arising out of or in connection with this
Commitment Letter, the Facilities, the use of the proceeds thereof, the
Transactions or any other related transaction or any claim, litigation,
investigation or proceeding relating to any of the foregoing, regardless of
whether any indemnified person is a party thereto, and to reimburse each
indemnified person upon demand for any reasonable legal or other expenses
incurred in connection with investigating or defending any of the foregoing,
PROVIDED that the foregoing indemnity will not, as to any indemnified person,
apply to losses, claims, damages, liabilities or related expenses to the extent
they are found by a final, non-appealable judgment of a court to arise from the
willful misconduct, bad faith or gross negligence of such indemnified person,
and (b) to reimburse CSI, Chase, DLJ, CSFB and Fleet and their respective
affiliates on demand for all reasonable out-of-pocket expense (including due
diligence expense, syndication expenses, consultant's fees and expenses, travel
expenses, and reasonable fees, charges and disbursements
3
<PAGE>
of counsel) incurred in connection with the Facilities and any related
documentation (including this Commitment Letter, the Term Sheet, the Fee Letters
and the definitive financing documentation) or the administration, amendment,
modification or waiver thereof. No indemnified person shall be liable for any
damages arising from the use by others of Information (provided that such
indemnified person is not in breach of the confidentiality provisions hereof) or
other materials obtained through electronic, telecommunications or other
information transmissions systems or for any special, indirect, consequential or
punitive damages in connection with the Facilities.
You acknowledge that we and our respective affiliates (the term "we"
being understood to refer hereinafter in this paragraph to include such
affiliates) may be providing debt financing, equity capital or other services
(including financial advisory services) to other companies in respect of which
you may have conflicting interests regarding the transactions described herein
and otherwise. We will not use confidential information obtained from you by
virtue of the transactions contemplated by this Commitment Letter or our other
relationships with you in connection with the performance by us of services for
other companies, and we will not furnish any such information to other
companies. You also acknowledge that we have no obligation to use in connection
with the transactions contemplated by this Commitment Letter, or to furnish to
you, confidential information obtained from other companies.
This Commitment Letter shall not be assignable by any party hereto
without the prior written consent of the other parties hereto (and any purported
assignment without such consent shall be null and void), is intended to be
solely for the benefit of the parties hereto and is not intended to confer any
benefits upon, or create any rights in favor of, any person other than the
parties hereto. This Commitment Letter may not be amended or waived except by an
instrument in writing signed by you, CSI, Chase, DLJ, CSFB and Fleet. This
Commitment Letter may be executed in any number of counterparts, each of which
shall be an original, and all of which, when taken together, shall constitute
one agreement. Delivery of an executed signature page of this Commitment Letter
by facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. This Commitment Letter and the Fee Letters are the only
agreements that have been entered into among us with respect to the Facilities
and set forth the entire understanding of the parties with respect thereto. This
Commitment Letter shall be governed by, and construed in accordance with, the
laws of the State of New York.
This Commitment Letter is delivered to you on the understanding that
neither this Commitment Letter, the Term Sheet or the Fee Letters nor any of
their terms or substance shall be disclosed, directly or indirectly, to any
other person except (a) you may disclose this Commitment Letter, the Term Sheet
and the Fee Letters (i) to your officers, agents and advisors who are directly
involved in the consideration of this matter or (ii) as may be compelled in a
judicial or administrative proceeding or as otherwise required by law, including
public disclosures required under United States securities rules and regulations
(in which case you agree to inform us promptly thereof) and (b) you may disclose
this Commitment Letter and the Term Sheet, and their terms and substance (but
not the Fee Letters or their terms and substance) to Concentra, its officers,
agents and advisors who are directly involved in the consideration of the
Transactions on a confidential basis.
The compensation, reimbursement, indemnification and confidentiality
provisions contained herein and in the Fee Letters shall remain in full force
and effect regardless of whether definitive financing documentation shall be
executed and delivered and notwithstanding the termination of this Commitment
Letter or the commitments hereunder; PROVIDED, that your obligations under this
Commitment Letter, other than those arising under the fourth, fifth, sixth and
thirteenth paragraphs hereof, shall automatically terminate and be superseded by
the provisions of the definitive documentation relating to the Facilities upon
the initial funding thereunder, and you shall automatically be release from all
liability in connection therewith at such time. Subject to the foregoing, this
Commitment Letter shall automatically terminate if the closing of the Facilities
shall not occur by reason of any condition described in clause (c) or (d) in the
ninth paragraph hereof not being satisfied or waived, as of the date on which
the parties hereto mutually agree that such closing would otherwise occur.
If the foregoing correctly sets forth our agreement, please indicate
your acceptance of the terms hereof and of the Term Sheet and the Fee Letters by
returning to us executed counterparts hereof and of the Fee Letters not later
than 8:00 p.m., New York City time, on February 26, 1999. The commitments and
the agreements herein will expire at such
4
<PAGE>
time in the event Chase has not received such executed counterparts and such
amounts in accordance with the immediately preceding sentence.
5
<PAGE>
We are pleased to have been given the opportunity to assist you in
connection with this important financing.
Very truly yours,
CHASE SECURITIES INC.
By: /s/ JAMES A. FEELEY III
------------------------------------
Name: JAMES A. FEELEY III
----------------------------------
Title: VICE PRESIDENT
----------------------------------
THE CHASE MANHATTAN BANK
By: /s/ DEBORAH DAVEY
------------------------------------
Name: DEBORAH DAVEY
----------------------------------
Title: VICE PRESIDENT
DLJ CAPITAL FUNDING, INC.
By: /s/ JAMES L. PARADISE
------------------------------------
Name: JAMES L. PARADISE
----------------------------------
Title: SENIOR VICE PRESIDENT
---------------------------------
CREDIT SUISSE FIRST BOSTON
By: /s/ RICHARD CARY
------------------------------------
Name: RICHARD CARY
-----------------------------------
Title: DIRECTOR
----------------------------------
By: /s/ ARTURO DE PENA
------------------------------------
Name: ARTURO DE PENA
------------------------------------
Title: DIRECTOR
-----------------------------------
FLEET NATIONAL BANK
By: /s/ JOHN E. DUNCAN
------------------------------------
Name: JOHN E. DUNCAN
-----------------------------------
Title: MANAGING DIRECTOR
----------------------------------
6
<PAGE>
Accepted and agreed to
as of the date first
written above by:
WELSH, CARSON, ANDERSON & STOWE VIII, L.P.
By: WCAS VIII ASSOCIATES, L.L.C.,
its General Partner
By: /s/ ANDREW M. PAUL
-----------------------------------
Name: ANDREW M. PAUL
----------------------------------
Title: MEMBER
7
<PAGE>
Exhibit A
SENIOR SECURED CREDIT FACILITIES
Summary of Terms and Conditions
February 26, 1999
--------------------
Welsh, Carson, Anderson & Stowe VIII, L.P., together with its
affiliates (collectively, "WCAS") will form a new corporation ("NEWCO") for the
purpose of effecting the recapitalization (the "ACQUISITION") of Concentra
Managed Care, Inc. ("CONCENTRA"). The Acquisition will be effected by a merger
of Newco with and into Concentra, as a result of which WCAS will own 93% of the
common stock of Concentra and the existing stockholders will own 7% of such
common stock. The existing stockholders of Concentra, other than WCAS, will
receive cash consideration in exchange for the remainder of their common stock
in Concentra. Alternatively, in the event that WCAS and Concentra so agree, WCAS
will form a new corporation ("NEWCO I") and other investors selected by WCAS and
satisfactory to the Underwriters (collectively, the "OTHER INVESTOR") will form
a new corporation ("NEWCO II"), and the Acquisition will be effected by Newco I
and Newco II being merged with and into Concentra, as a result of which WCAS and
the Other Investor will own 93% and 7%, respectively, of the common stock of
Concentra and the other existing stockholders of Concentra will receive cash for
all their existing common stock of Concentra. For purposes hereof, any such
alternate transaction (the "ALTERNATE TRANSACTION") is also referred to as the
"Acquisition." Immediately after the Acquisition, Concentra will contribute (the
"CONTRIBUTION") all of its assets, including the stock of its direct
subsidiaries, to a newly created wholly-owned subsidiary (the "BORROWER"). In
connection with the Acquisition and the Contribution, approximately $328,000,000
of the existing indebtedness of Concentra will be refinanced (the "REFINANCING";
together with the Acquisition and the Contribution, the "TRANSACTIONS").
I. PARTIES
Concentra: Concentra Managed Care, Inc.
Borrower: A newly created, wholly owned-subsidiary of
Concentra as referred to above (the
"BORROWER").
Guarantors: All obligations of the Borrower under the
Senior Secured Credit Facility and hedging
arrangements entered into with the Lenders (as
defined below) and their affiliates shall be
unconditionally guaranteed by Concentra and
each of the Borrower's direct and indirect
wholly-owned subsidiaries (the "GUARANTORS";
the Borrower and the Guarantors, collectively,
the "LOAN PARTIES").
Advisor, Co-Lead Arranger
and Joint Book Manager: Chase Securities Inc. ("CSI" and, in such
capacity, a "CO-LEAD ARRANGER").
Administrative Agent: The Chase Manhattan Bank ("CHASE" and, in such
capacity, the "ADMINISTRATIVE AGENT").
Co-Lead Arranger, Joint Book
Manager and Syndication Agent: DLJ Capital Funding, Inc. ("DLJ") (in such
capacity, the "SYNDICATION AGENT" or a "CO-LEAD
ARRANGER"; together with the Administrative
Agent, the "AGENTS").
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Co-Documentation Agents: Credit Suisse First Boston ("CSFB") and Fleet
National Bank ("FLEET"; each, in such capacity,
a "CO-DOCUMENTATION AGENT").
Lenders: A syndicate of banks, financial institutions
and other entities, including Chase, DLJ, CSFB
and Fleet, to be arranged by CSI and the
Administrative Agent in consultation with the
Borrower (the "LENDERS").
II. TYPES AND AMOUNTS OF CREDIT FACILITIES
1. TERM FACILITIES
Type and Amount of Facility: Term loan facilities (the "TERM FACILITIES") in
the aggregate principal amount of $375,000,000
(the loans thereunder, the "TERM LOANS") as
follows:
TRANCHE B TERM FACILITY: A seven year term loan
facility to the Borrower (the "TRANCHE B TERM
FACILITY") in an aggregate principal amount of
$250,000,000 (the loans thereunder, the
"TRANCHE B TERM LOANS"). The Tranche B Term
Loans shall be repayable in nominal quarterly
installments (in no event more than 1% per
annum) for the first six years and thereafter
in substantial quarterly installments to be
determined until the date that is seven years
after the Closing Date.
TRANCHE C TERM FACILITY: An eight year term
loan facility to the Borrower (the "TRANCHE C
TERM FACILITY") in an aggregate principal
amount of $125,000,000 (the loans thereunder,
the "TRANCHE C TERM LOANS"). The Tranche C Term
Loans shall be repayable in nominal quarterly
installments (in no event more than 1% per
annum) for the first seven years and thereafter
in substantial quarterly installments to be
determined until the date that is eight years
after the Closing Date.
Availability: The Term Loans shall be made in a single
drawing on the Closing Date (as defined below).
Purpose: The proceeds of the Term Loans shall be used to
finance the Transactions and to pay related
fees and expenses.
2. REVOLVING FACILITY
Type and Amount of Facility: Six-year revolving credit facility (the
"REVOLVING FACILITY"; together with the Term
Facilities, the "CREDIT FACILITIES") in the
amount of $100,000,000 (the loans thereunder,
the "REVOLVING LOANS"; together with the Term
Loans, the "LOANS").
Availability: The Revolving Facility shall be fully available
on a revolving basis during the period
following the Closing Date and ending on the
sixth anniversary thereof (the "REVOLVING
TERMINATION DATE"). No Revolving Loans shall be
made on the Closing Date.
Letters of Credit: A portion of the Revolving Facility not in
excess of an amount to be determined shall be
available for the issuance of letters of credit
(the "LETTERS OF CREDIT") by Chase (in such
capacity, the "ISSUING LENDER"). No
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Letter of Credit shall have an expiration date
after the earlier of (a) one year after the
date of issuance (unless approved by Lenders
holding not less than a majority of the
Revolving Facility) and (b) five business days
prior to the Revolving Termination Date,
PROVIDED that any Letter of Credit with a
one-year term may provide for the renewal
thereof for additional one-year periods (which
shall in no event extend beyond the date
referred to in clause (b) above).
Drawings under any Letter of Credit shall be
reimbursed by the Borrower (whether with its
own funds or with the proceeds of the Revolving
Loans) on the next business day. To the extent
that the Borrower does not so reimburse the
Issuing Lender, the Lenders under the Revolving
Facility shall be irrevocably and
unconditionally obligated to reimburse the
Issuing Lender on a PRO RATA basis.
Maturity: The Revolving Termination Date.
Purpose: The proceeds of the Revolving Loans shall be
used to finance the working capital needs and
for general corporate purposes of the Borrower
and its subsidiaries, including acquisitions
and investments in other entities subject to
restrictions and limitations to be determined.
III. CERTAIN PAYMENT PROVISIONS
Fees and Interest Rates: As set forth on Annex I.
Optional Prepayments and
Commitment Reductions: Loans may be prepaid and commitments may be
reduced by the Borrower in minimum amounts to
be agreed upon. Optional prepayments of the
Term Loans shall be applied to the Tranche B
Loans and the Tranche C Loans ratably and to
the installments thereof in an order to be
determined and may not be reborrowed.
Mandatory Prepayments and
Commitment Reductions: The following amounts shall be applied to
prepay the Term Loans and reduce the Revolving
Facility:
(a) 50% of the net proceeds of any sale or
issuance of equity after the Closing Date by
Concentra or the Borrower (excluding equity
issued to directors and employees under benefit
plans, equity issued to sellers as
consideration in acquisitions and equity issued
to the existing shareholders of Concentra or in
a private placement to investors arranged by
WCAS to finance acquisitions);
(b) 100% of the net proceeds of any incurrence
of certain indebtedness (excluding Senior
Subordinated Notes (as defined below) the net
proceeds of which are used to refinance the
Senior Subordinated Bridge Debt (as defined
below)) after the Closing Date by Concentra or
the Borrower or any of their subsidiaries;
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<PAGE>
(c) 100% of the net proceeds of any sale or
other disposition (other than as a result of
casualty or condemnation where such proceeds
are used to repair or replace assets up to a
maximum amount to be determined) by Concentra
or the Borrower or any of their subsidiaries of
any assets (except for the sale of inventory in
the ordinary course of business and certain
other exceptions to be agreed upon and subject
to threshold and limitations to be determined);
and
(d) 50% of excess cash flow (to be defined in a
mutually satisfactory manner) for each fiscal
year of the Borrower commencing with the first
full fiscal year after the Closing Date).
All such amounts shall be applied, FIRST, to
the prepayment of the Term Loans and, SECOND,
to the permanent reduction of the Revolving
Facility. Each such prepayment of the Term
Loans shall be applied to the Tranche B Term
Loans and the Tranche C Term Loans ratably and
to the installments thereof in an order to be
determined and may not be reborrowed. The
Revolving Loans shall be prepaid and the Letter
of Credit shall be cash collateralized or
replaced to the extent such extensions of
credit exceed the amount of the Revolving
Facility.
IV. COLLATERAL The obligations of each Loan Party in respect
to the Credit Facilities and heading
arrangements entered into with the Lenders and
their affiliates shall be secured by a
perfected first priority security interest in
substantially all of its tangible and
intangible assets (including, without
limitation, intellectual property, real
property and all of the capital stock of each
of its direct and indirect subsidiaries),
excluding assets subject to certain permitted
liens and rights under non-assignable contracts
of types to be agreed upon.
V. CERTAIN CONDITIONS
Initial Conditions: The availability of the Credit Facilities shall
be conditioned upon satisfaction of, among
other things, the following conditions
precedent (the date upon which all such
conditions precedent shall be satisfied, the
"CLOSING DATE");
(a) Each Loan Party shall have executed and
delivered satisfactory definitive financing
documentation with respect to the Credit
Facilities (the "CREDIT DOCUMENTATION").
(b) Newco shall have received at least
$347,600,000 in cash and Concentra shares from
the issuance of its common stock (which amount
includes the cash purchase price for shares in
Newco purchased by WCAS and the value of shares
already owned by WCAS and contributed to Newco,
each as set forth in the Sources and Uses Table
in Annex II hereto) on satisfactory terms and
conditions. The existing stockholders (other
than WCAS) will own 7% of the common stock of
Concentra after the Acquisition with a value of
approximately $30,600,000. Concentra shall have
received at least $110,200,000 from the
issuance of its senior unsecured notes on
satisfactory terms and conditions (including
that the interest thereon shall be payable in
kind for at least the first five years
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<PAGE>
following the Closing Date) (the "CONCENTRA
NOTES"), each on satisfactory terms and
conditions, and the Borrower shall have
received at least $190,000,000 from the
issuance of senior subordinated bridge debt to
an affiliate of WCAS and other investors
arranged by it (the "SENIOR SUBORDINATED BRIDGE
DEBT") on satisfactory terms and conditions or
its senior subordinated debt (the "SENIOR
SUBORDINATED NOTES"), issued in a public
offering or under Rule 144A on satisfactory
terms and conditions. The ownership and capital
structure of each Loan Party after the
Transactions; and the terms applicable thereto,
shall be reasonably satisfactory in all
respects.
(c) The Transactions shall have been
consummated in a manner consistent with the
Sources and Uses Table attached as Annex II
hereto and pursuant to reasonably satisfactory
documentation, and no provision of such
documentation shall have been waived, amended,
supplemented or otherwise modified in any
material respect. Concentra and its
subsidiaries shall not have any indebtedness
(other than immaterial indebtedness on terms
and conditions satisfactory to the
Administrative Agent) immediately prior to or
immediately after the Closing Date other than
the Concentra Notes, the Senior Subordinated
Notes and the Loans and indebtedness refinanced
as contemplated on such Sources and Uses Table.
(d) The Lenders, the Co-Lead Arrangers, the
Co-Documentation Agents and the Agents shall
have received all fees required to be paid, and
all expenses required to be reimbursed and for
which invoices have been presented, on or
before the Closing Date.
(e) All governmental and third party approvals
necessary or, in the discretion of the
Administrative Agent, advisable in connection
with the Transactions, the financings
contemplated hereby and the continuing
operations of Concentra, the Borrower and their
subsidiaries shall have been obtained and be in
full force and effect, and all applicable
waiting periods shall have expired without any
action being taken or threatened by any
competent authority that would restrain,
prevent or otherwise impose materially adverse
conditions on the Transactions or the
financings thereof.
(f) The Lenders shall have received (i)
satisfactory audited consolidated financial
statements of Concentra for its fiscal year
ended December 31, 1998 and satisfactory
unaudited consolidating (on a business unit
basis) financial statements of Concentra for
such fiscal year and (ii) satisfactory
unaudited interim consolidated and
consolidating (on a business unit basis)
financial statements of Concentra for each
quarterly period and satisfactory unaudited
interim consolidated financial statements of
Concentra for each fiscal month, ended
subsequent to December 31, 1998, as to which
such financial statements are available.
(g) Concentra shall have consolidated EBITDA
for the twelve months ending with the fiscal
quarter most recently completed prior to the
Closing Date of not less than $107,500,000
(calculated in a manner consistent with
discussions between WCAS and CSI prior to the
date hereof).
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(h) The Lenders shall have received a
satisfactory PRO FORMA consolidated balance
sheet of each of Concentra and the Borrower as
at the date of the most recent consolidated
balance sheet delivered pursuant to paragraph
(f) above, adjusted to give effect to the
consummation of the Transactions and the
financings contemplated hereby as if such
transactions had occurred on such date.
(i) The Lenders shall have received
satisfactory financial information and analyses
for Concentra and the Borrower and their
subsidiaries for the period from the Closing
Date through the final maturity of the Term
Loans.
(j) The Lenders shall have received the results
of a recent lien search in each relevant
jurisdiction with respect to Concentra, the
Borrower and their subsidiaries, and such
search shall reveal no liens on any of the
assets of Concentra, the Borrower or their
subsidiaries except for liens permitted by the
Credit Documentation or liens to be discharged
on or prior to the Closing Date pursuant to
documentation satisfactory to the
Administrative Agent.
(k) The fees and expenses to be incurred in
connection with the Transactions and the
financing thereof shall not exceed $45,000,000
in the aggregate.
(l) The Agents shall be reasonably satisfied
with the liability and casualty insurance
applicable to the Borrower and its subsidiaries
on the Closing Date, with respect to periods
before and after the Closing Date.
(m) The Lenders shall have received a
satisfactory solvency opinion from an
independent valuation firm reasonably
satisfactory to the Administrative Agent that
shall document the solvency of Concentra and
the Borrower (on a consolidated basis) after
giving effect to the Transactions and the other
transactions contemplated hereby.
(n) The Lenders shall have received such legal
opinions (including opinions (i) from counsel
to the Borrower and its subsidiaries, (ii)
delivered to Newco by counsel to Concentra,
accompanied by reliance letters in favor of the
Lenders as reasonable available and (iii) from
such special and local counsel as may be
required by the Administrative Agent),
consultants' reports and opinions and such
other documents and instruments as are
customary for transactions of this type or as
they may reasonably request.
On-Going Conditions: The making of each extension of credit shall be
conditioned upon (a) the accuracy of all
representations and warranties in the Credit
Documentation (including, without limitation,
the material adverse change and litigation
representations) and (b) there being no default
or event of default in existence at the time
of, or after giving effect to the making of,
such extension of credit. As used herein and in
the Credit Documentation a "material adverse
change" shall mean any event, development or
circumstance that has had or could reasonably
be expected to have a material adverse affect
on (a) the Transactions, (b) the business,
property,
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<PAGE>
operations, condition (financial or
otherwise) or prospects of the Borrower and
its subsidiaries taken as a whole or (c) the
validity or enforceability of any of the
Credit Documentation.
VI. CERTAIN DOCUMENTATION MATTERS
The Credit Documentation shall contain
representations, warranties, covenants and
events of default customary for financings
of this type and other terms deemed
appropriate by the Lenders, including,
without limitation:
Representations and Warranties: Financial statements (including pro forma
financial statements); absence of material
undisclosed liabilities; no material adverse
change; corporate existence; compliance with
law; corporate power and authority;
enforceability of Credit Documentation; no
conflict with law or material contractual
obligations; no material litigation; no
default; ownership of property; liens;
intellectual property; no material
burdensome restrictions; taxes; Federal
Reserve regulations; ERISA; Investment
Company Act; subsidiaries; environmental
matters; solvency; labor matters; material
year 2000 matters; accuracy of disclosure in
all material respects; adequacy of
insurance; and creation and perfection of
security interests.
Affirmative Covenants: Delivery of financial statements, reports,
accountants' letters, projections, officers'
certificates and other information
reasonably requested by the Lenders; payment
of other material obligations; continuation
of business and maintenance of existence and
material rights and privileges; compliance
with laws and material contractual
obligations; maintenance of property and
insurance; maintenance of books and records;
right of the Lenders to inspect property and
books and records; notices of defaults;
litigation and other material events;
compliance in all material respects with
environmental laws; further assurances
(including, without limitation, with respect
to security interests in after-acquired
capital stock); and an agreement by the
Borrower to obtain, following the Closing
Date, interest rate protection in amounts
and on terms satisfactory to the
Administrative Agent.
Financial Covenants: Financial covenants (including, without
limitation, minimum interest and fixed
charge coverage and maximum leverage).
Negative Covenants: Limitations on (with exceptions to be agreed
upon with respect to): indebtedness; liens;
guarantee obligations; mergers,
consolidations, liquidations and
dissolutions; sales of assets; leases;
dividends and other payments in respect of
capital stock; capital expenditures;
investments, loans and advances; optional
payments and modifications of subordinated
and other debt instruments; transactions
with affiliates; sale and leasebacks;
changes in fiscal year; negative pledge
clauses; changes in lines of business; and
changes after the Closing Date in passive
holding company status of Concentra. The
dividend covenant shall permit dividends to
be paid by the Borrower to enable Concentra
to pay interest on the Concentra Notes
following the fifth anniversary of the
Closing Date, subject to the achievement of
performance or financial criteria to be
determined.
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Events of Default: Nonpayment of principal when due; nonpayment
of interest, fees or other amounts after a
grace period to be agreed upon; material
inaccuracy of representations and
warranties; violation of covenants (subject,
in the case of certain affirmative
covenants, to a grace period to be agreed
upon); cross-default (subject to a threshold
to be agreed upon); bankruptcy events;
certain ERISA events; material judgments;
actual or asserted invalidity of any
guarantee or security document,
subordination provisions or security
interest; and a change of control (the
definition of which is to be agreed).
Voting: Amendments and waivers with respect to the
Credit Documentation shall require the
approval of Lenders holding not less than a
majority of the aggregate amount of the
Credit Facilities, except that (a) the
consent of each Lender directly affected
thereby shall be required with respect to
(i) reductions in the amount or extensions
of the scheduled date of amortization or
final maturity of any Loan, (ii) reductions
in the rate of interest or any fee or
extensions of any due date thereof and (iii)
increases in the amount or extensions of the
expiry date of any Lender's commitment and
(b) the consent of 100% of the Lenders shall
be required with respect to (i)
modifications to any of the voting
percentages and (ii) releases of all or
substantially all of the Guarantors or all
or substantially all of the collateral.
Assignments and Participations: The Lenders shall be permitted to assign and
sell participations in their Loans and
commitments, subject, in the case of
assignments (other than to another Lender or
to an affiliate of a Lender), to the consent
of the Administrative Agent and the Borrower
(which consent in each case shall not be
unreasonably withheld). Non-pro rata
assignments shall be permitted. In the case
of partial assignments (other than to
another Lender or to an affiliate of a
Lender), the minimum assignment amount shall
be $5,000,000 unless otherwise agreed by the
borrower and the Administrative Agent.
Participants shall have the same benefits as
the Lenders with respect to yield protection
and increased cost provisions. Voting rights
of participants shall be limited to those
matters with respect to which the
affirmative vote of the Lender from which it
purchased its participation would be
required as described under "Voting" above.
Pledges of Loans in accordance with
applicable law shall be permitted without
restriction. Promissory notes shall be
issued under the Credit Facilities only upon
request.
Yield Protection: The Credit Documentation shall contain
customary provisions (a) protecting the
Lenders against increased costs or loss of
yield resulting from changes in reserve,
tax, capital adequacy and other requirements
of law and from the imposition of or changes
in withholding or other taxes and (b)
indemnifying the Lenders for "breakage
costs" incurred in connection with, among
other things, any prepayment of a Eurodollar
Loan on a day other than the last day of an
interest period with respect thereto, with
the foregoing subject to the right of the
Borrower to replace any Lender who has
incurred material increased costs.
Expenses and Indemnification: The Borrower shall pay (a) all reasonable
out-of-pocket expenses of the Administrative
Agent and the Co-Lead Arrangers, the
Syndication Agent
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and the Co-Documentation Agents associated
with the syndication of the Credit
Facilities and the preparation, execution,
delivery and administration of the Credit
Documentation and any amendment or waiver
with respect thereto (including the
reasonable fees, disbursements and other
charges of counsel) and (b) all
out-of-pocket expenses of the Administrative
Agent and the Lenders (including the
reasonable fees, disbursements and other
charges of counsel) in connection with the
enforcement of the Credit Documentation.
The Administrative Agent, the Co-Lead
Arrangers, the Syndication Agent, the
Co-Documentation Agents and the Lenders (and
their affiliates and there respective
officers, directors, employees, advisors and
agents) will have no liability for, and will
be indemnified and held harmless against,
any losses, claims, damages, liabilities or
expenses incurred in respect of the
financing contemplated hereby or the use or
the proposed use of proceeds thereof, except
to the extent they are found by a final,
non-appealable judgment of a court to arise
from the gross negligence or willful
misconduct of the indemnified party.
Governing Law and Forum: State of New York.
Counsel to the Administrative
Agent and CSI: Simpson Thacher & Bartlett.
9
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ANNEX I
INTEREST AND CERTAIN FEES
Interest Rate Options: The Borrower may elect that the Loans
comprising each borrowing bear interest at a
rate per annum equal to:
the ABR plus the Applicable Margin; or
the Eurodollar Rate plus the Applicable
Margin.
As used herein:
"ABR" means the highest of (i) the rate of
interest publicly announced by Chase as its
prime rate in effect at its principal office
in New York City (the "PRIME RATE") and (ii)
the federal funds effective rate from time
to time PLUS 0.5%.
"APPLICABLE MARGIN" means (a) in the case of
ABR Loans (as defined below), 2.25% for
Tranche B Term Loans, 2.50% for Tranche C
Term Loans, and 1.75% for Revolving Loans,
and (b) in the case of Eurodollar Loans (as
defined below), 3.25% for Tranche B Term
Loans, 3.50% for Tranche C Term Loans, and
2.75% for Revolving Loans. The Applicable
Margins for Revolving Loans shall be subject
to reduction following the first anniversary
of the Closing Date in accordance with a
pricing grid based on leverage levels to be
determined and provided that no event of
default has occurred and is continuing.
"EURODOLLAR RATE" means the rate (adjusted
for statutory reserve requirements for
eurocurrency liabilities) for eurodollar
deposits for a period equal to one, two,
three or six months (as selected by the
Borrower) appearing on Page 3750 of the Dow
Jones Markets screen.
Interest Payment Dates: In the case of Loans bearing interest based
upon the ABR ("ABR Loans"), quarterly in
arrears.
In the case of Loans bearing interest based
upon the Eurodollar Rate ("EURODOLLAR
LOANS"), on the last day of each relevant
interest period and, in the case of any
interest period longer than three months, on
each successive date three months after the
first day of such interest period.
Commitment Fees: The Borrower shall pay a commitment fee
calculated at the rate of _ of 1% per annum
on the average daily unused portion of the
Revolving Facility, payable quarterly in
arrears.
Letter of Credit Fees: The Borrower shall pay a fee on all
outstanding Letters of Credit at a per annum
rate equal to the Applicable Margin then in
effect with respect to Eurodollar Loans on
the average daily undrawn face amount of
each such Letter of Credit. Such fee shall
be shared ratably among the Lenders
participating in the Revolving Facility and
shall be payable quarterly in arrears.
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A fronting fee equal to 0.125% per annum on
the average daily undrawn face amount of
each Letter of Credit shall be payable
quarterly in arrears to the Issuing Lender
for its own account. In addition, customary
administrative, issuance, amendment, payment
and negotiation charges shall be payable to
the Issuing Lender for its own account.
Default Rate: At any time when the Borrower is in default
in the payment of any amount of principal
due under the Credit Facilities, all
outstanding Loans shall bear interest at 2%
above the rate otherwise applicable thereto.
Overdue interest, fees and other amounts
shall bear interest at 2% above the rate
applicable to ABR Loans.
Rate and Fee Basis: All per annum rates shall be calculated on
the basis of a year of 360 days (or 365/366
days, in the case of ABR Loans the interest
rate payable on which is then based on the
Prime Rate) for actual days elapsed.
2
EXHIBIT (A)(2)
CHASE CAPITAL PARTNERS
380 Madison Avenue, 12th Floor
New York, New York 10017
February 24, 1999
Welsh, Carson, Anderson & Stowe
320 Park Avenue
Suite 2500
New York, New York 10022
CONCENTRA MANAGED CARE, INC.
Ladies and Gentlemen:
You have advised Chase Capital Partners (together with one or more of
its affiliated investment entities, "CCP") that a group of investors
(collectively, the "Investors") led by Welsh, Carson, Anderson & Stowe ("WCAS")
intends to effect a leveraged recapitalization (the "Recapitalization") of
Concentra Managed Care, Inc. (together with its subsidiaries, the "Company"). We
understand that you will form a company ("Newco") that will effect the
Recapitalization of the Company. You have also advised us that in connection
with the Recapitalization, Newco and the Company will raise gross cash proceeds
of approximately $1.1 billion from, among other things, the issuance by the
Company of $89,600,000 aggregate principal amount of 10 year pay-in-kind senior
unsecured Notes ("PIK Notes"), together with common stock (the "Common Stock"
and, together with the PIK Notes, the "Investment").
Based upon what CCP has learned to date in connection with the
foregoing, CCP is pleased to advise you of CCP's strong interest to purchase (i)
up to fifty percent (50%) of the principal amount of the PIK Notes and (ii) up
to $20,000,000 Common Stock of the Company, generally upon the terms and subject
to the conditions set forth or referred to in this letter (the "Letter"). We
understand that the remainder of the $89,600,000 aggregate principal amount of
PIK Notes will be purchased by one or more affiliates of WCAS or other
purchasers satisfactory to CCP. We understand that CCP would be acquiring the
PIK Notes and Common Stock on the same terms and conditions as WCAS.
Our interest in purchasing the PIK Notes and Common Stock is based upon
among other things, our understanding that (a) all written reports and other
information with respect to Newco, the Company and the Recapitalization
(collectively, the "Information"), other than the projections
1
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Welsh, Carson, Anderson & Stowe
Page 2
contained therein (the "Projections"), that have been or will be made available
to CCP by you or any of your representatives are or will be, when furnished,
complete and correct in all material respects and do not or will not, when
furnished, contain any untrue statement of material fact or omit to state a
material fact necessary in order to make the statements contained therein not
misleading in light of the circumstances under which such statements are made
and (b) the Projections that have been or will be made available to CCP by you
or any of your representatives have been or will be prepared in good faith and
based upon reasonable assumptions at the time made. We further understand that
you will supplement the Information and the Projections from time to time until
the date of the issuance of the PIK Notes so that our understanding in the
preceding sentence continues to be correct in all material respects. You agree
that CCP will be entitled to use and rely primarily on the Information and
Projections without responsibility for independent verification thereof.
CCP's interest in the Investment is subject to, among other things (a)
there not having occurred any material adverse change in the business, assets,
operations, properties condition (financial or otherwise), contingent
liabilities, prospects or material agreements of Newco or the Company since
December 31, 1998, (b) CCP not becoming aware after the date hereof of any
information or other matter affecting the Company or the transactions
contemplated hereby which is inconsistent in a material and adverse manner with
any such information or other matter disclosed to us prior to the date hereof,
(c) CCP's reasonable satisfaction in all respects with the structure and all
other aspects of the Recapitalization and the other transactions contemplated
hereby, including (i) the material terms of all the agreements to be entered
into in connection with the Recapitalization, (ii) all legal, tax, financing and
accounting matters relating to the Recapitalization and (iii) the capitalization
and structure of Newco and the Company after giving effect to the
Recapitalization, (d) the approval of CCP's internal investment committee and
(e) the negotiation, execution and delivery of definitive documentation with
respect to the Investment satisfactory in all respects (including as to the
terms of the Investment not covered in this Letter) to CCP and you.
This Letter is not intended to be and should not be construed as a
commitment with respect to the PIK Notes and the related Warrants or Common
Stock or any other financing and creates no obligation or liability on the part
of CCP or any of its affiliates to participate in any financing. Any such
commitment, obligation or liability will only be created by our execution of a
commitment letter or definitive documentation with respect to the Investment.
This Letter is delivered to you on the understanding that the existence
of this Letter and the terms or substance hereof shall not be disclosed,
directly or indirectly, except (a) as may be compelled to be disclosed in a
judicial or administrative proceeding or as otherwise required by law (in which
case you agree to inform us promptly thereof); (b) on a confidential and
"need-to-know" basis, to your officers, directors, employees, agents and
advisors (collectively, "Representatives") and the Representatives of the other
Investors and the Company who are directly involved in the consideration of this
matter; or (c) the board of directors of the Company and their advisors and
agents.
2
<PAGE>
Welsh, Carson, Anderson & Stowe
Page 3
You acknowledge that CCP and its affiliates may be providing debt
financing, equity capital or other services (including financial advisory
services) to other companies in respect of which Newco, the Company, you or your
affiliates may have conflicting interests. CCP will not use confidential
information obtained from you by virtue of the transactions contemplated by this
Letter or its other relationships with you, Newco, or the Company in connection
with the performance by CCP or any of its affiliates of services for other
companies, and CCP will not furnish any such information to such other
companies. You also acknowledge that CCP and its affiliates have no obligation
to use in connection with the transactions contemplated by this Letter, or to
furnish to you or any of your affiliates, confidential information obtained by
CCP or any of its affiliates from other companies.
This Letter (and CCP's interest hereunder) shall not be assignable by
you without the prior written consent of CCP (and any purported assignment
without such consent shall be null and void), is intended to be solely for the
benefit of the parties hereto and is not intended to confer any benefits upon,
or create any rights in favor of, any person other than the parties hereto. This
Letter may not be amended or waived except by an instrument in writing signed by
you and CCP. This Letter may be executed in any number of counterparts, each of
which shall be an original, and all of which, when taken together, shall
constitute one agreement. Delivery of an executed signature page of this Letter
by facsimile transmission shall be effective as delivery of a manually executed
counterpart hereof. This Letter is the only understanding that has been entered
into among us with respect to the Investment and sets forth the entire
understanding of the parties with respect thereto. This Letter shall be governed
by, and construed in accordance with, the laws of the State of New York.
CCP is a general partnership with over $6.5 billion under management.
CCP's sole limited partner is The Chase Manhattan Corporation, the nation's
largest bank holding company with over $360 billion in assets. CCP has invested
in more than 700 companies, including management buyouts, growth equity
investments, mezzanine debt and equity investments and venture capital
transactions.
3
<PAGE>
Welsh, Carson, Anderson & Stowe
Page 4
CCP is pleased to have been given the opportunity to work with you in
connection with the financing for the Recapitalization and we look forward to
working with you.
Very truly yours,
CHASE CAPITAL PARTNERS
By: /s/ ERIC GREEN
-------------------------
Name: ERIC GREEN
-----------------------
Title: MANAGING DIRECTOR
------------------------
EXHIBIT (A)(3)
--------------
WCAS CAPITAL PARTNERS III, L.P.
320 PARK AVENUE, SUITE 2500
NEW YORK, NEW YORK 10022
March 1, 1999
Concentra Managed Care, Inc.
c/o BT Alex. Brown Incorporated
One South Street
Baltimore, Maryland 21202
Attention: Brent B. Milner
Ladies and Gentlemen:
We refer to the letter dated February 26, 1999, from Welsh,
Carson, Anderson & Stowe VIII, L.P. ("WCAS VIII"), to you (together with the
accompanying exhibits and other related materials, the "Revised Bid Letter"),
wherein WCAS VIII offered to acquire (the "Acquisition") the stock of Concentra
Managed Care, Inc. ("Concentra"). The Revised Bid Letter contemplates the sale
by Concentra of $110.2 million in aggregate principal amount of senior unsecured
pay-in-kind notes, and indicates that the undersigned would purchase at least
$65.4 million in aggregate principal amount of such notes. This will confirm
that, in the event that the balance (of $54.8 million in aggregate principal
amount) of such notes is not sold on or prior to the closing date of the
Acquisition, the undersigned will purchase any notes not so sold, up to a total
purchase of $110.2 million in aggregate principal amount (including the $65.4
million that the undersigned has already committed to purchase), to enable WCAS
VIII to consummate the Acquisition and related transactions on substantially the
terms set forth in the Revised Bid Letter.
Very truly yours,
WELSH, CARSON, ANDERSON & STOWE VIII, L.P.
By WCAS VIII Associates, L.L.C., its General Partner
By /s/ ANDREW M. PAUL
--------------------------------------
Managing Member
EXHIBIT (C)(2)
--------------
WELSH, CARSON, ANDERSON & STOWE VIII, L.P.
320 PARK AVENUE, SUITE 2500
NEW YORK, NEW YORK 10022
March 24, 1999
Yankee Acquisition Corp.
c/o Welsh, Carson, Anderson & Stowe VIII, L.P.
320 Park Avenue, Suite 2500
New York, New York 10022
Concentra Managed Care, Inc.
c/o BT Alex. Brown Incorporated
One South Street
Baltimore, Maryland 21202
Attention: Brent B. Milner
Ladies and Gentlemen:
Reference is made to the Amended and Restated Agreement and Plan of
Merger, dated as of the date hereof (the "Agreement"), between Yankee
Acquisition Corp. ("Newco") and Concentra Managed Care, Inc. (the "Company").
Capitalized terms used herein and not otherwise defined herein have the meanings
given to them in the Agreement.
We hold the number of securities (collectively, the "Securities") of
the Company reported in our Schedule 13D-1, as amended, filed with the
Securities and Exchange Commission with respect to the Company. We agree with
Newco and the Company that, if at any time between the date hereof and the
Effective Time, Newco shall have any obligations or liabilities, whether under
the Agreement or otherwise, that cannot be satisfied out of the assets of Newco,
we shall promptly contribute to Newco the number of Securities necessary to
satisfy such obligations or liabilities, up to the aggregate number of the
Securities we hold (or, if we elect to sell any of the Securities, our
obligation to contribute the Securities sold shall be converted into our
obligation to contribute to Newco the proceeds from such sale). Any such
investment shall reduce by an equal amount our aggregate commitment to invest in
Newco. In furtherance of our obligations hereunder, we agree not to sell,
transfer, pledge or otherwise dispose of the Securities, except for sales
thereof for cash or a contribution of the Securities to Newco as contemplated by
the Agreement.
<PAGE>
Notwithstanding anything that may be expressed or implied in the
foregoing provisions of this letter agreement, Newco and the Company, by their
acceptance of the benefits hereof, covenant, agree and acknowledge that no
Person other than Welsh, Carson, Anderson & Stowe VIII, L.P. ("WCAS VIII"),
shall have any obligation hereunder and that, notwithstanding that WCAS VIII is
a partnership, no recourse hereunder shall be had against any current or future
officer, director, agent or employee of WCAS VIII, against any current or future
general or limited partner of WCAS VIII or against any current or future
director, officer, employee, general or limited partner, member, affiliate or
assignee of any of the foregoing, whether by the enforcement of any assessment
or by any legal or equitable proceeding, or by virtue of any statute, regulation
or other applicable law. Without limiting the generality of the foregoing, it is
expressly agreed and acknowledged that no personal liability whatsoever shall
attach to, be imposed on or otherwise incurred by any current or future officer,
agent or employee of WCAS VIII, any current or future general or limited partner
of WCAS VIII or any current or future director, officer, employee, general or
limited partner, member, affiliate or assignee of any of the foregoing, as such
for any obligations of WCAS VIII under this letter agreement or for any claim
based on, in respect of or by reason of such obligations or their creation.
WCAS VIII agrees that it shall, and shall cause its affiliates to,
vote all shares of Company Common Stock owned by WCAS VIII or any of its
affiliates in favor of the adoption of the Agreement.
Very truly yours,
WELSH, CARSON, ANDERSON & STOWE VIII, L.P.
By WCAS VIII Associates, L.L.C., its General Partner
By /s/ PAUL B. QUEALLY
-----------------------------
Managing Member
2
EXHIBIT (C)(3)
--------------
STOCK SUBSCRIPTION AGREEMENT
----------------------------
STOCK SUBSCRIPTION AGREEMENT dated as of March 24, 1999 (this
"AGREEMENT") by and between, Ferrer Freeman Thompson & Co. ("FFT"), on behalf of
Health Care Capital Partners L.P. and as its general partner and on behalf of
Health Care Executive Partners L.P. and as its general partner (collectively,
"BUYERS"), and Yankee Acquisition Corp., a Delaware corporation ("NEWCO").
RECITALS:
---------
Newco and Concentra Managed Care, Inc., a Delaware corporation
("CONCENTRA"), are parties to an Agreement and Plan of Merger dated as of March
2, 1999, and amended and restated as of the date hereof (as so amended, the
"MERGER AGREEMENT"), pursuant to which, upon the terms and subject to the
conditions set forth therein, (i) Newco will merge with and into Concentra (the
"MERGER"), (ii) each outstanding share of common stock, par value $0.01 per
share ("CONCENTRA COMMON STOCK"), of Concentra outstanding immediately prior to
the Merger (other than shares of Concentra Common Stock owned by Concentra or
Newco or their affiliates) will be converted into the right to receive $16.50
per share in cash, without interest, (iii) each outstanding share of common
stock, par value $0.01 per share ("NEWCO COMMON STOCK"), of Newco will be
converted into one share of Concentra Common Stock and (iv) each outstanding
share of Class A common stock, par value $0.01 per share ("NEWCO CLASS A COMMON
STOCK"), of Newco will be converted into one share of Class A common stock, par
value $0.01 per share ("CONCENTRA CLASS A COMMON STOCK"), of Concentra.
All of the issued and outstanding Newco Common Stock is currently
owned by Welsh, Carson, Anderson & Stowe VIII, L.P. ("WCAS").
Newco desires to issue and sell newly issued shares of Newco Class A
Common Stock to Buyers upon the terms and subject to the conditions hereinafter
set forth.
Buyers have conditioned its purchase of the shares of Newco Class A
Common Stock to be purchased by it hereunder on Newco making certain
representations and warranties to it hereunder and, in order to induce Buyers to
purchase such shares and in connection with the transactions contemplated to
occur on the Closing Date (as defined below), including the Merger, Newco is
willing to make such representations and warranties.
AGREEMENT
---------
NOW, THEREFORE, the parties hereto agree as follows:
ARTICLE
PURCHASE AND SALE
-----------------
<PAGE>
Section 1.1 PURCHASE AND SALE. Upon the terms and subject to the
conditions of this Agreement, Newco agrees to issue and sell to each Buyer, and
each Buyer agrees to purchase from Newco, the number of shares of newly issued
Newco Class A Common Stock (collectively, the "PURCHASE STOCK") set forth
opposite its name on Schedule I hereto. The purchase price for the Purchase
Stock is $16.50 per share (the "PER SHARE PURCHASE Price") and the aggregate
purchase price for all the Purchase Stock is $30,599,993 (the "AGGREGATE
PURCHASE Price").
Section 2.1 CLOSING. The closing (the "CLOSING") of the purchase and
sale of the Purchase Stock hereunder shall take place at the offices of Reboul,
MacMurray, Hewitt, Maynard & Kristol, 45 Rockefeller Plaza, New York, New York,
immediately prior to the consummation of the Merger. At the Closing, (a) FFT, on
behalf of each Buyer, shall deliver to Newco, in immediately available funds,
the Aggregate Purchase Price by wire transfer to an account designated by Newco
not later than one business day prior to the date of the Closing (the "CLOSING
DATE") and (b) Newco shall deliver to each Buyer, certificates for such Buyer's
Purchase Stock, duly registered in the names of each Buyer.
ARTICLE 2
REPRESENTATIONS AND WARRANTIES OF NEWCO
---------------------------------------
Newco represents and warrants to Buyers as of the date hereof that:
Section 2.1 CORPORATE EXISTENCE AND POWER: NEWLY FORMED CORPORATION.
Newco is a corporation duly incorporated, validly existing and in good standing
under the laws of the State of Delaware. Newco was incorporated solely for the
purpose of effectuating the transactions contemplated in the Merger Agreement
(including the transactions contemplated by this Agreement) and has not
conducted any business or entered into any agreements or commitments except with
respect to the foregoing.
Section 2.2 AUTHORIZATION. The execution, delivery and performance by
Newco of this Agreement and the Merger Agreement and the consummation of the
transactions contemplated hereby and thereby are within Newco's corporate powers
and have been duly authorized by all necessary corporate action on the part of
Newco. Each of this Agreement and the Merger Agreement has been duly executed
and delivered by Newco. Each of this Agreement and the Merger Agreement
constitutes a valid and binding agreement of Newco, enforceable against Newco in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, and other laws of general application
affecting enforcement or creditors' rights generally, (ii) as limited by laws
relating to the availability of specific performance, injunctive relief, or
other equitable remedies and (iii) with respect to provisions relating to
indemnification arid contribution, as limited by considerations of public
policy.
2
<PAGE>
Section 2.3 GOVERNMENTAL AUTHORIZATION. The execution, delivery and
performance by Newco of this Agreement and the Merger Agreement require no
order, license, consent, authorization or approval of, or exemption by, or
action by or in respect of, or notice to, or filing or registration with, any
governmental body, agency or official except for (i) filings under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
ACT"), (ii) the filing with the Securities and Exchange Commission (the "SEC")
of such reports under and such other compliance with the Securities Exchange Act
of 1934, as amended (the "EXCHANGE Act"), and the rules and regulations
thereunder as may be required in connection with the Merger Agreement, this
Agreement and the transactions contemplated thereby and hereby, (iii) the filing
of a certificate of merger with the Secretary of State of the State of Delaware,
(iv) such filings and approvals as may be required by any applicable state
securities "blue sky" or takeover laws, (v) such as have been obtained, or (vi)
except where the failure to obtain any such order, license, consent,
authorization, approval or exemption or give any such notice or make any filing
or registration would not reasonably be expected to adversely affect the ability
of Newco to perform its obligations hereunder or thereunder.
Section 2.4 NONCONTRAVENTION. The execution, delivery and performance
by Newco of this Agreement and the Merger Agreement do not and will not (i)
violate the certificate of incorporation or bylaws of Newco, (ii) violate any
law, rule, regulation, judgment, injunction, order or decree applicable to or
binding upon Newco, (iii) require any consent or other action by any person
under, constitute a default under (with due notice or lapse of time or both), or
give rise to any right of termination, cancellation or acceleration of any right
or obligation of Newco or to a loss of any benefit to which Newco is entitled
under any provision of any agreement or other instrument binding upon Newco or
any of its assets or properties or (iv) result in the creation or imposition of
any material mortgage, lien, pledge, charge, security interest or encumbrance
(each, a "LIEN") on any property or asset of Newco.
Section 2.5 CAPITALIZATION. The authorized capital stock of Newco
consists of 105,000,000 shares of Newco Common Stock, 20,000,000 shares of
preferred stock, par value $0.01 per share and 5,000,000 shares of Newco Class A
Common Stock. Immediately prior to the Closing, the outstanding capital stock of
Newco will be 10 shares of Newco Common Stock and no shares of preferred stock.
Immediately prior to the Closing, WCAS will own all of the issued and
outstanding shares of capital stock of Newco. Immediately after the Closing, but
prior to the effective time of the Merger, the outstanding capital stock of
Newco, will be 23,742,187 shares of Newco Common Stock, 1,854,545 shares of
Newco Class A Common Stock and no shares of preferred stock. Except as set forth
in this Section 2.5 or on Schedule 2.5 there are, and immediately after the
Closing but prior to the Merger there will be, no outstanding (i) shares of
capital stock or voting securities of Newco, (ii) securities of Newco
convertible into or exchangeable for shares of capital stock or voting
securities of Newco, (iii) options or other rights to acquire from Newco, or
other obligation of Newco to issue any capital stock, voting securities or
securities convertible into or exchangeable for capital stock or voting
securities of Newco or (iv) obligation of Newco to repurchase or otherwise
acquire or retire any
3
<PAGE>
shares of capital stock or any convertible securities, rights or options of the
type described in clause (i), (ii), or (iii). The Newco Class A Common Stock
shall have the rights and other terms set forth in the Amended and Restated
Charter of Newco attached hereto as Exhibit A.
Section 2.6 LITIGATION. Except as set forth on Schedule 2.6 hereto,
there is no action, suit, investigation or proceeding pending against, or to the
knowledge of Newco, threatened against or affecting Newco before any court or
arbitrator or any governmental body, agency or official which in any manner
challenges or seeks to prevent, enjoin, alter or materially delay the
transactions contemplated by this Agreement or the Merger Agreement or which
would reasonably be expected to have a material adverse effect on the ability of
Newco to perform its obligations under this Agreement or the Merger Agreement or
to consummate the Merger or on the business, properties, financial condition or
results of operations of Concentra after the Merger.
Section 2.7 VALID ISSUANCE OF SECURITIES. The shares of Purchase Stock
which are being issued to Buyers hereunder have been duly and validly authorized
and when issued, sold and delivered in accordance with the terms hereof for the
consideration expressed herein, will be fully paid and nonassessable.
ARTICLE 3
REPRESENTATION AND WARRANTIES OF BUYERS
---------------------------------------
Each Buyer represents and warrants to Newco as of the date hereof
that:
Section 3.1 EXISTENCE AND POWER. Such Buyer is a corporation, limited
partnership or limited liability company, as the case may be, duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization.
Section 3.2 AUTHORIZATION. The execution, delivery and performance by
such Buyer of this Agreement and the consummation of the transactions
contemplated hereby are within its corporate, partnership or limited liability
company, as the case may be, powers and have been duly authorized by all
necessary action on the part of such Buyer. This Agreement has been duly
executed and delivered by such Buyer. This Agreement constitutes a valid and
binding agreement of such Buyer, enforceable against such Buyer in accordance
with its terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement or creditors' rights generally, (ii) as limited by laws relating to
the availability of specific performance, injunctive relief, or other equitable
remedies and (iii) with respect to provisions relating to indemnification and
contribution, as limited by considerations of public policy.
4
<PAGE>
Section 3.3 GOVERNMENTAL AUTHORIZATION. The execution, delivery and
performance by such Buyer of this Agreement require no order, license, consent,
authorization or approval of, or exemption by, or action by or in respect of, or
notice to, or filing or registration with, any governmental body, agency or
official except such as have been obtained or except for (i) filings under the
HSR Act, (ii) such filings and approvals as may be required by any applicable
state securities "blue sky" laws, (iii) such as have been obtained, or (iv)
where the failure to obtain any such order, license, consent, authorization,
approval or exemption or give any such notice or make any filing or registration
would not reasonably be expected to adversely affect the ability of such Buyer
to perform its obligations hereunder.
Section 3.4 NONCONTRAVENTION. The execution, delivery and performance
by such Buyer of this Agreement do not and will not (i) violate, if such Buyer
is a corporation, the certificate of incorporation or bylaws of such Buyer, if
such Buyer is a limited partnership, the certificate of limited partnership or
agreement of limited partnership of such Buyer, or, if such Buyer is a limited
liability company, the certificate of formation or limited liability company
agreement of such Buyer, (ii) violate any law, rule, regulation, judgment,
injunction, order or decree applicable to or binding upon such Buyer, (iii)
require any consent or other action by any person under, constitute a default
under (with due notice or lapse of time or both), or give rise to any right of
termination, cancellation or acceleration of any right or obligation of such
Buyer or to a loss of any benefit to which such Buyer is entitled under any
provision of any agreement or other instrument binding upon such Buyer or any of
its assets or properties or (iv) result in the creation or imposition of any
material Lien on any property or asset of such Buyer.
Section 3.5 PURCHASE FOR INVESTMENT. Such Buyer is purchasing its
Purchase Stock for investment for its own account and not with a view to, or for
sale in connection with, any distribution thereof.
Section 3.6 PRIVATE PLACEMENT. () Such Buyer's financial situation is
such that such Buyer can afford to bear the economic risk of holding its
Purchase Stock for an indefinite period of time, and such Buyer can afford to
suffer the complete loss of the investment in its Purchase Stock.
(b) Such Buyer's knowledge and experience in financial and business
matters are such that it is capable of evaluating the merits and risks of the
investment in its Purchase Stock or such Buyer has been advised by a
representative possessing such knowledge and experience.
(c) Such Buyer understands that the Purchase Stock acquired hereunder
is a speculative investment which involves a high degree of risk of loss of the
entire investment therein, that there will be substantial restrictions on the
transferability of the Purchase Stock and that for an indefinite period
following the date hereof there will be no public market for the Purchase Stock
and that, accordingly, it may not be possible for such Buyer to sell the
Purchase Stock in case of emergency or otherwise.
5
<PAGE>
(d) Such Buyer and its representatives, including, to the extent it
deems appropriate, its professional, financial, tax and other advisors, have
reviewed all documents provided to them in connection with the investment in the
Purchase Stock, and such Buyer understands and is aware of the risks related to
such investment.
(e) Such Buyer and its representatives have been given the opportunity
to examine all documents and to ask questions of, and to receive answers from,
Newco, Concentra and their respective representatives concerning the terms and
conditions of the acquisition of the Purchase Stock and related matters and to
obtain all additional information which such Buyer or its representatives deem
necessary.
(f) Such Buyer is an "ACCREDITED INVESTOR" as such term is defined in
Regulation D under the Securities Act of 1933, as amended, and the rules and
regulations promulgated thereunder.
Section 3.7 LITIGATION. There is no action, suit, investigation or
proceeding pending against, or to the knowledge of such Buyer threatened against
or affecting, such Buyer before any court or arbitrator or any governmental
body, agency or official which in any manner challenges or seeks to prevent,
enjoin, alter or materially delay the transactions contemplated by this
Agreement.
Section 3.8 BROKERS OR FINDERS' FEES. There is no investment banker,
broker, finder or other intermediary which has been retained by, will be
retained by or is authorized to act on behalf of such Buyer who might be
entitled to any fee or commission from Concentra, Newco or such Buyer upon
consummation of the transactions contemplated by this Agreement.
ARTICLE 4
COVENANTS OF NEWCO AND BUYERS
-----------------------------
Section 4.1 STOCKHOLDERS' AND REGISTRATION RIGHTS AGREEMENT. Newco and
each Buyer agree that they shall use their reasonable best efforts to enter into
a stockholders' agreement and a registration rights agreement (the "ANCILLARY
AGREEMENTS") containing the terms set forth on Schedule 4.1.
Section 4.2 FURTHER ASSURANCES. Newco and each Buyer agree that, from
time to time, whether on or after the Closing Date, each of them will execute
and deliver such further instruments of conveyance and transfer and take such
other actions as may be necessary to carry out the purposes and intents of this
Agreement.
ARTICLE 5
CONDITIONS TO CLOSING
---------------------
6
<PAGE>
Section 5.1 CONDITIONS TO OBLIGATIONS OF BUYERS AND NEWCO. The
obligations of Buyers and Newco to consummate the transactions contemplated
hereby are subject to the satisfaction of the following conditions:
(a) No provision of any applicable law, rule or regulation and no
judgment, injunction, order or decree by any governmental entity of
competent jurisdiction shall prohibit the consummation of the Closing or
the Merger.
(b) All material actions by or in respect of, or filings with, any
governmental body, agency, official or authority required to permit the
consummation of the Closing shall have been taken, made or obtained.
(c) Newco shall have received an equity contribution of at least
$346,900,000 from WCAS and affiliated investors.
(d) The conditions to the consummation of the Merger set forth in
Article 6 of the Merger Agreement, other than those to be satisfied at the
effective time of the Merger, shall have been satisfied or waived.
Section 5.2 CONDITIONS TO OBLIGATIONS OF BUYERS. The obligation of
each Buyer to consummate the transactions contemplated hereby is subject to the
satisfaction of the following further conditions:
(a) (i) Newco shall have performed in all material respects all of its
obligations hereunder required to be performed by it on or prior to the
Closing Date and (ii) the representations and warranties of Newco contained
in this Agreement shall be true in all material respects when made and at
and as of the Closing Date, as if made at and as of such date.
(b) Each of Concentra and WCAS shall have executed and delivered the
Ancillary Agreements on terms consistent with Section 4.1 hereof and
reasonably satisfactory to FFT, on behalf of Buyers.
(c) Newco shall not have waived any of the conditions to the Merger
contained in Sections 6.1 or 6.3 of the Merger Agreement nor have altered,
amended or modified the Merger Agreement without the prior consent of FFT,
on behalf of Buyers, which consent shall not be unreasonably withheld.
(d) Arrangements for equity participation, in the surviving
corporation of the Merger, by management of Concentra shall be reasonably
acceptable to FFT, on behalf of Buyers.
7
<PAGE>
(e) FFT, on behalf of Buyers, shall have received all documents it may
reasonably request relating to the existence of Newco and the authority of
Newco for this Agreement, all in form and substance reasonably satisfactory
to FFT, on behalf of Buyers.
Section 5.3 CONDITIONS TO OBLIGATION OF NEWCO. The obligation of Newco
to consummate the transactions contemplated hereby is subject to the
satisfaction of the following further conditions:
(a) (i) Each Buyer shall have performed in all material respects all
of its obligations hereunder required to be performed by it at or prior to
the Closing Date and (ii) the representations and warranties of such Buyer
contained in this Agreement shall be true in all material respects when
made and at and as of the Closing Date, as if made at and as of such date.
(b) Each Buyer and Concentra shall have executed and delivered the
Ancillary Agreements on terms consistent with Section 4.1 hereof and
reasonably satisfactory to Newco.
ARTICLE 6
SURVIVAL OF REPRESENTATIONS AND WARRANTIES: INDEMNIFICATION
-----------------------------------------------------------
Section 6.1 SURVIVAL. Except for the representations and warranties
contained in Sections 2.5 and 2.7, which shall survive indefinitely, the
representations and warranties of the parties hereto contained in this Agreement
shall survive the Closing until twelve months after the Closing Date, and
thereafter shall terminate and be of no further force or effect.
Section 6.2 INDEMNIFICATION. () Newco hereby indemnifies, severally
and not jointly, each Buyer and its affiliates, limited partners, general
partners, directors, officers and employees against and agrees to hold each of
them harmless from any and all damage, loss, liability and expense (including,
without limitation, reasonable expenses of investigation and reasonable
attorneys' fees and expenses in connection with any action, suit or proceeding)
("DAMAGES") incurred or suffered by any such party arising out of any
misrepresentation or breach of warranty, covenant or agreement made or to be
performed by Newco pursuant to this Agreement; PROVIDED that with respect to any
Buyer, (i) Newco shall not be liable under this Section 6.2(a) unless the
aggregate amount of Damages with respect to all matters referred to in this
Section 6.2(a) for which such Buyer has sought indemnification exceeds $100,000
and then only to the extent of such excess and (ii) the indemnifying parties'
aggregate maximum liability under this Section 6.2(a) shall not exceed the
amount of the Aggregate Purchase Price paid by such Buyer to Newco.
8
<PAGE>
(b) Each Buyer hereby indemnifies, severally and not jointly, Newco
and its affiliates, limited partners, general partners, directors, officers
and employees against and agrees to hold each of them harmless from any and
all Damages incurred or suffered by any such party arising out of any
misrepresentation or breach of warranty, covenant or agreement made or to
be performed by such Buyer pursuant to this Agreement; PROVIDED that (i)
such Buyer shall not be liable under this Section 6.2(b) unless the
aggregate amount of Damages with respect to all matters referred to in this
Section 6.2(b) exceeds $100,000 and then only to the extent of such excess
and (ii) such Buyer's maximum liability under this Section 6.2(b) shall not
exceed the amount of Aggregate Purchase Price paid by such Buyer to Newco.
Section 6.3 EXCLUSIVITY. After the Closing, Section 6.2 will provide
the exclusive remedy for any misrepresentation, breach of warranty, covenant or
other agreement or other claim arising out of this Agreement or the transactions
contemplated hereby.
ARTICLE 7
TERMINATION
Section 7.1 GROUNDS FOR TERMINATION. This Agreement may be terminated
at any time prior to the Closing:
(a) by mutual written agreement of Newco and FFT, on behalf of Buyers;
(b) by either Newco, on the one hand, or FFT, on behalf of Buyers, on
the other hand, if the Closing, shall not have been consummated as of the
close of business on August 31, 1999, PROVIDED that the right to terminate
this Agreement under this Section 7.1(b) shall not be available to any
party whose breach of any obligation under this Agreement has been the
cause of or resulted in the failure of the Closing to occur on or before
such date; or
(c) by Newco, on the one hand, or FFT, on behalf of Buyers, on the
other hand, if consummation of the transactions contemplated hereby would
violate any non-appealable final order, decree or judgment of any court or
governmental body having competent jurisdiction.
Section 7.2 EFFECT OF TERMINATION. If this Agreement is terminated as
permitted by Section 7.1, such termination shall be without liability of any
party (or any stockholder, general partner, limited partner, member, director,
officer, employee, agent, consultant or representative of such party) to any of
the other parties to this Agreement and this Agreement shall become void and of
no further force or effect; PROVIDED that if such termination shall result from
the willful (i) failure of either party to fulfill a condition to the
performance of the obligations of the other party, (ii) failure to perform a
covenant of this Agreement or (iii)
9
<PAGE>
material breach by either party hereto of any representation or warranty or
agreement contained herein, such party shall be liable for such breach prior to
such termination. Notwithstanding the foregoing, the provisions of Sections 8.3,
8.5, 8.6 and 8.7 shall survive any termination hereof pursuant to Section 7.1.
Section 7.3 RESCISSION. If the Closing shall occur but the Merger
shall not have been consummated by the close of business on the third business
day following the Closing, then the purchase and sale of the Purchase Stock
shall be rescinded, Newco shall return to Buyers the Aggregate Purchase Price
paid by them for the Purchase Stock and Buyers shall return to Newco the
certificates representing the Purchase Stock. Upon any such rescission, the
parties hereto shall be treated for all purposes as if the Closing had not
occurred, including without limitation with respect to rights to terminate this
Agreement as provided in Section 7.1.
ARTICLE 8
MISCELLANEOUS
Section 8.1 NOTICES. All notices, requests and other communications to
any party hereunder shall be in writing (including facsimile transmission) and
shall be given:
if to Newco, to:
Yankee Acquisition Corp.
c/o Welsh, Carson, Anderson & Stowe, VIII L.P
320 Park Avenue, Suite 2500
New York, New York 10022
Attention: Paul B. Queally
Fax: (212) 893-9566
with a copy to:
Reboul, MacMurray, Hewitt, Maynard & Kristol
45 Rockefeller Plaza
New York, New York 10111
Attention: Othon A. Prounis
Fax: (212) 841-5725
if to any Buyer, to it:
c/o Ferrer Freeman Thompson & Co.
The Mill
10
<PAGE>
10 Glenville Street
Greenwich, Conncecticut 06831
Attention: Carlos Ferrer
Fax: (203) 532-8016
with a copy to:
Fried, Frank, Harris, Shriver & Jacobson
One New York Plaza
New York, New York 10004
Attention: David Golay
Fax: (212) 859-8164
or to such other address or telecopy number and with such other copies as such
party may hereafter specify for the purpose of notice. All such notices,
requests and other communications shall be deemed received on the date of
receipt by the recipient thereof if received prior to 5:00 p.m. in the place of
receipt and such day is a business day in the place of receipt. Otherwise, any
such notice, request or communication shall be deemed not to have been received
until the next succeeding business day in the place of receipt.
Section . AMENDMENTS AND WAIVERS. () Any provision of this Agreement
may be amended or waived if, but only if, such amendment or waiver is in writing
and signed in the case of an amendment, by each party to this Agreement, or in
the case of a waiver, by the party against whom the waiver is to be effective.
() No failure or delay by any party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof nor shall any single
or partial exercise thereof preclude any other or further exercise thereof
or the exercise of any other right, power or privilege. The rights and
remedies herein provided shall be cumulative and not exclusive of any
rights or remedies provided by law.
Section 8.3 EXPENSES. () All costs and expenses incurred in connection
with this Agreement shall be paid by the party incurring such cost or expense,
except that if the Closing shall occur, Newco shall reimburse Buyers for all
documented out-of-pocket expenses incurred by them, including, without
limitation, the reasonable fees and expenses of one counsel for all Buyers, up
to, but not in excess of, $100,000 in the aggregate for all such expenses.
(b) In the event that Newco receives the Company Termination Fee (as
defined in the Merger Agreement) from Concentra, Buyers will be entitled to
(i) a portion thereof (the "PRO RATA PORTION") calculated by multiplying
the amount of the Company Termination Fee less the portions of the
Termination Fee payable to the entities set forth on Schedule 5.4(b) of the
Merger Agreement by a fraction the numerator of which is the total number
of
11
<PAGE>
shares set forth on Schedule 1 and the denominator of which is the total
number of shares of Concentra Common Stock and Concentra Class A Common
Stock expected to be outstanding immediately after the Merger as set forth
in Section 2.5 hereof and (ii) reimbursement for all its fees and expenses
to the extent recoverable from Concentra pursuant to Section 5.3 of the
Merger Agreement and the Pro Rata Portion of its fees and expenses actually
reimbursed by Concentra to the extent the total amount of fees and expenses
recoverable from Concentra pursuant to Section 5.3 of the Merger Agreement
exceeds the limitations provided therein.
Section 8.4 SUCCESSORS AND ASSIGNS. The provisions of this Agreement
shall be binding upon any inure to the benefit of the parties hereto and their
respective successors and assigns, PROVIDED that no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of each other party hereto (it being agreed that a merger
(including the Merger) shall not be deemed an assignment requiring the consent
of Buyers). Notwithstanding the foregoing, Buyers may assign their rights under
this Agreement or the right to receive any of the Purchased Shares under this
Agreement to any general or limited partner of Buyers or FFT or any affiliates
(as defined in Rule 405 promulgated under the Securities Act) of Buyers or FFT
(collectively, the "FFT PARTIES" and each an "FFT PARTY"), who are reasonably
acceptable to Newco; PROVIDED that any such FFT Party executes an assumption
agreement reasonably satisfactory in form and substance to Newco whereby such
FFT Party makes certain representations and warranties as set forth in this
Agreement and agrees to be bound, to the same extent as its transferor, by the
terms of this Agreement.
Section 8.5 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the law of the State of New York.
Section 8.6 JURISDICTION. The parties hereto agree that any suit,
action or proceeding seeking to enforce any provision of, or based on any matter
arising out of or in connection with, this Agreement or the transactions
contemplated hereby may only be brought in the United States District Court for
the Southern District of New York or any New York State court sitting in New
York City, and each of the parties hereby consents to the jurisdiction of such
courts (and of the appropriate appellate courts therefrom) in any such suit,
action or proceeding and irrevocably waives, to the fullest extent permitted by
law, any objection which it may now or hereafter have to the laying of the venue
of any such suit, action or proceeding in any such court or that any such suit,
action or proceeding which is brought in any such court has been brought in an
inconvenient forum. Process in any such suit, action or proceeding may be served
on any party anywhere in the world, whether within or without the jurisdiction
of any such court. Without limiting the foregoing, each party agrees that
service of process on such party as provided in Section 9.1 shall be deemed
effective service of process on such party.
Section 8.7 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY.
12
<PAGE>
Section 8.8 COUNTERPARTS; THIRD PARTY BENEFICIARIES. This Agreement
may be signed in any number of counterparts, each of which shall be an original,
with the same effect as if the signatures thereto and hereto were upon the same
instrument. This Agreement shall become effective when each party hereto shall
have received a counterpart hereof signed by the other party hereto. No
provision of this Agreement shall confer upon any person other than the parties
hereto any rights or remedies hereunder.
Section 8.9 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter of this
Agreement and supersedes all prior agreements and understandings, both oral and
written, between the parties with respect to the subject matter of this
Agreement.
Section 8.10 CAPTIONS. The captions herein are included for
convenience of reference only and shall be ignored in the construction or
interpretation hereof.
Section 8.11 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
deemed to be excluded from this Agreement and the balance of this Agreement
shall be interpreted as if such provision were so excluded and shall be enforced
in accordance with its terms to the maximum extent permitted by law.
Section 8.12 INTERPRETATION. 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.
13
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed by their respective authorized officers as of the day and year
first above written.
YANKEE ACQUISITION CORP.
By: /s/ PAUL B. QUEALLY
------------------------------------
Name: Paul B. Queally
Title: President
FERRER FREEMAN THOMPSON & CO., LLC.
on behalf of HEALTH CARE CAPITAL
PARTNERS L.P. and as its General Partner
and
on behalf of HEALTH CARE EXECUTIVE
PARTNERS L.P. and as its General Partner
By: /s/ ROBERT T. THOMPSON
-------------------------------------
Name: Robert T. Thompson
Title: Member
14
EXHIBIT 99.1
------------
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ JAMES M. GREENWOOD
---------------------------------
Signature
JAMES M. GREENWOOD
---------------------------------
Type or Print Name
MAY 28, 1999
--------------------------------
Date
<PAGE>
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ RICHARD A. PARR II
-----------------------------------------
Signature
RICHARD A. PARR II
-----------------------------------------
Type or Print Name
MAY 28, 1999
-----------------------------------------
Date
<PAGE>
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ DANIEL J. THOMAS
-----------------------------------------
Signature
DANIEL J. THOMAS
-----------------------------------------
Type or Print Name
MAY 28, 1999
-----------------------------------------
Date
<PAGE>
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ JOHN K. CARLYLE
--------------------------------------
Signature
JOHN K. CARLYLE
--------------------------------------
Type or Print Name
MAY 28, 1999
--------------------------------------
Date
<PAGE>
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ W. TOM FOGARTY, M.D.
--------------------------------------
Signature
W. TOM FOGARTY, M.D.
--------------------------------------
Type or Print Name
MAY 28, 1999
--------------------------------------
Date
<PAGE>
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ KENNETH LOFFREDO
--------------------------------------
Signature
KENNETH LOFFREDO
--------------------------------------
Type or Print Name
MAY 28, 1999
--------------------------------------
Date
<PAGE>
POWER OF ATTORNEY
FOR EXECUTING SCHEDULE 13E-3
Know all by these presents, that the undersigned hereby constitutes and
appoints each of James M. Greenwood, Richard A. Parr II and Daniel J. Thomas the
undersigned's true and lawful attorney-in-fact to:
(1) execute for and on behalf of the undersigned a Schedule 13E-3
(including amendments thereto) in accordance with Section 13(e) of the
Securities Exchange Act of 1934 and the rules thereunder;
(2) do and perform any and all acts for and on behalf of the undersigned
that may be necessary or desirable to complete and execute any such
Schedule 13E-3 (including amendments thereto) and file that Schedule
with the Securities and Exchange Commission and any other authority;
and
(3) take any other action of any type whatsoever in connection with the
foregoing that, in the opinion of any such attorney-in-fact, may be of
benefit to, in the best interest of, or legally required of the
undersigned, it being understood that the documents executed by the
attorney-in-fact on behalf of the undersigned pursuant to this Power of
Attorney shall be in such form and shall contain such terms and
conditions as the attorney-in-fact may approve in the
attorney-in-fact's discretion.
The undersigned hereby grants to each such attorney-in-fact full power
and authority to do and perform all and every act and thing whatsoever
requisite, necessary or proper to be done in the exercise of any of the rights
and powers herein granted, as fully to all intents and purposes as the
undersigned might or could do if personally present, with full power of
substitution or revocation, hereby ratifying and confirming all that any such
attorney-in-fact shall lawfully do or cause to be done by virtue of this Power
of Attorney and the rights and powers herein granted. The undersigned
acknowledges that each attorney-in-fact, in serving in such capacity at the
request of the undersigned, is not assuming any of the undersigned's
responsibilities to comply with Section 13 of the Securities Exchange Act of
1934.
The undersigned agrees that each attorney-in-fact may rely entirely on
information furnished orally or in writing by the undersigned to the
attorney-in-fact.
This Power of Attorney shall remain in full force and effect until the
undersigned has filed such Schedule 13E-3 (including amendments thereto), unless
earlier revoked by the undersigned in a signed writing delivered to each
attorney-in-fact. This Power of Attorney does not revoke any other power of
attorney that the undersigned has previously granted.
IN WITNESS WHEREOF, the undersigned has caused this Power of Attorney
to be executed effective as of the date written below.
/s/ THOMAS E. KIRALY
--------------------------------------
Signature
THOMAS E. KIRALY
--------------------------------------
Type or Print Name
MAY 28, 1999
--------------------------------------
Date
