sc13d

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, LX9BuUtsFP3Qnf5wEh4GWCEL6ajq5Of64Wb5Z+MejDzcmiEopiln+0SCNtR+e5eP lV8Ue+7mXEm6CeRMbQv6Pw== 0000950134-06-012951.txt : 20060710 0000950134-06-012951.hdr.sgml : 20060710 20060710163340 ACCESSION NUMBER: 0000950134-06-012951 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20060710 DATE AS OF CHANGE: 20060710 GROUP MEMBERS: KENNETH W DAVIDSON SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: ENCORE MEDICAL CORP CENTRAL INDEX KEY: 0000944763 STANDARD INDUSTRIAL CLASSIFICATION: ORTHOPEDIC, PROSTHETIC & SURGICAL APPLIANCES & SUPPLIES [3842] IRS NUMBER: 650572565 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-50431 FILM NUMBER: 06954227 BUSINESS ADDRESS: STREET 1: 9800 METRIC BOULEVARD CITY: AUSTIN STATE: TX ZIP: 78758 BUSINESS PHONE: 5128329500 MAIL ADDRESS: STREET 1: 9800 METRIC BOULEVARD CITY: AUSTIN STATE: TX ZIP: 78758 FORMER COMPANY: FORMER CONFORMED NAME: HEALTHCARE ACQUISITION CORP DATE OF NAME CHANGE: 19950531 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: ZIMMERMAN HARRY L CENTRAL INDEX KEY: 0001195366 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: BUSINESS PHONE: 5128329500 MAIL ADDRESS: STREET 1: ENCORE MEDICAL CORP STREET 2: 9800 METRIC BLVD CITY: AUSTIN STATE: TX ZIP: 78758 SC 13D 1 d37731sc13d.htm SCHEDULE 13D sc13d


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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934
(Amendment No. )*

ENCORE MEDICAL CORPORATION

(Name of Issuer)

Common Stock ($0.001 par value)

(Title of Class of Securities)

29256E109

(CUSIP Number)

Harry L. Zimmerman, Esq.
Encore Medical Corporation
9800 Metric Blvd.
Austin, Texas 78758
(512) 832-9500

Copy to:

Steven J. Gartner, Esq.
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, New York 10019
(212) 728-8000

(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)

June 30, 2006

(Date of Event Which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box. o

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See §240.13d-7 for other parties to whom copies are to be sent.

* The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purpose of Section 18 of the Securities Exchange Act of 1934 (“Act”) or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes).

Persons who respond to the collection of information contained in this form are not required to respond unless the form displays a currently valid OMB control number.


CUSIP No.		29256E109

NAMES OF REPORTING PERSONS:

Kenneth W. Davidson

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):

(a) o

(b) o

SEC USE ONLY:

SOURCE OF FUNDS (SEE INSTRUCTIONS):

CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

CITIZENSHIP OR PLACE OF ORGANIZATION:

United States

SOLE VOTING POWER:

NUMBER OF

SHARED VOTING POWER:

BENEFICIALLY

OWNED BY

10,879,760*

EACH

SOLE DISPOSITIVE POWER:

REPORTING

PERSON

WITH

SHARED DISPOSITIVE POWER:

10,879,760*

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

10,879,760*

CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

15.3%

TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

Beneficial ownership of the shares of common stock referred to herein is being reported hereunder solely because the reporting person may be deemed to have beneficial ownership of such shares as a result of the Galen Voting Agreement and Management Voting Agreement described in Item 4 hereof. Neither the filing of this Schedule 13D nor any of its contents shall be deemed to constitute an admission by any of the reporting persons that it is the beneficial owner of any of the shares of common stock referred to herein for purposes of Section 13(d) of the Act or for any other purpose, and such beneficial ownership is expressly disclaimed.


CUSIP No.		29256E109

NAMES OF REPORTING PERSONS:

Harry L. Zimmerman

I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (SEE INSTRUCTIONS):

(a) o

(b) o

SEC USE ONLY:

SOURCE OF FUNDS (SEE INSTRUCTIONS):

CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e):

CITIZENSHIP OR PLACE OF ORGANIZATION:

United States

SOLE VOTING POWER:

NUMBER OF

SHARED VOTING POWER:

BENEFICIALLY

OWNED BY

10,879,760*

EACH

SOLE DISPOSITIVE POWER:

REPORTING

PERSON

WITH

SHARED DISPOSITIVE POWER:

10,879,760*

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON:

10,879,760*

CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES (SEE INSTRUCTIONS):

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):

15.3%

TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):

TABLE OF CONTENTS


	ITEM 1. SECURITY AND ISSUER
	ITEM 2. IDENTITY AND BACKGROUND
	ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
	ITEM 4. PURPOSE OF THE TRANSACTION
	ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
	ITEM 6. CONTRACTS, ARRANGEMENTS OR UNDERSTANDINGS WITH RESPECT TO SECURITIES OF THE ISSUER
	ITEM 7. MATERIAL TO BE FILED AS EXHIBITS
SIGNATURE
Joint Filing Agreement
Voting Agreement
Voting Agreement

ITEM 1. SECURITY AND ISSUER.

This Statement on Schedule 13D (the “Schedule 13D”) relates to the shares of common stock, par value $0.001 per share (the “Common Stock”) of Encore Medical Corporation, a Delaware corporation (the “Company”). The principal executive offices of the Company are located at 9800 Metric Blvd., Austin, Texas 78758.

ITEM 2. IDENTITY AND BACKGROUND.

This Schedule 13D is being filed jointly by:

	(i)		Mr. Kenneth W. Davidson; and

	(ii)		Mr. Harry L. Zimmerman (the foregoing, collectively, the “Reporting Persons”).

The principal business address of each Reporting Person is c/o Encore Medical Corporation, 9800 Metric Blvd., Austin, Texas 78758.

The principal occupation of Mr. Kenneth W. Davidson is Chairman and Chief Executive Officer of the Company. Mr. Harry L. Zimmerman is an Executive Vice President and General Counsel of the Company.

During the last five years, none of the Reporting Persons has been (i) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding has been or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, Federal or state securities laws or finding any violations of such laws.

Each of Messrs. Kenneth W. Davidson and Harry L. Zimmerman is a United States citizen.

ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.

Not Applicable.

ITEM 4. PURPOSE OF THE TRANSACTION.

On May 17, 2006, at the request of the Company, Blackstone Management Associates V L.L.C., a Delaware limited liability company (“BMA”), on behalf of Blackstone Capital Partners V L.P., a Delaware limited partnership (“BCP V”) and affiliated funds, submitted a letter to the Company outlining a proposal to acquire the Company in a public to private transaction (the “Transaction”).

On June 30, 2006, the Company issued a press release that it had entered into an agreement and plan of merger (the “Merger Agreement”) with Grand Slam Acquisition Corp., a Delaware corporation (“BCP Acquisition”) and Grand Slam Holdings, LLC, a Delaware limited liability company (“BCP Holdings” and, together with BCP Acquisition, the “BCP Acquisition Entities”), pursuant to which, among other things, the Company would become wholly owned by BCP Holdings. The Company entered into the Merger Agreement based on the unanimous recommendation by a special committee comprised of independent directors of the Company’s board of directors and the unanimous consent of its full Board of Directors.

Concurrently with execution of the Merger Agreement, the BCP Acquisition Entities entered into a voting agreement dated as of June 30, 2006, with Galen Partners III, L.P., Galen Partners International III, L.P., and Galen Employee Fund III, L.P. (each a “Galen Holder”, and collectively, the “Galen Holders”) (the “Galen Voting Agreement”), relating to the 10,088,724 shares of Common Stock beneficially owned by the Galen Holders or any shares of Common Stock over which any Galen Holder acquires beneficial ownership subsequent to the date of the Galen Voting Agreement (collectively, the “Galen Subject Shares”). Pursuant to the Galen Voting Agreement, and during the Voting Period (as defined below), each Galen Holder has agreed to vote or execute consents with respect to all Galen Subject Shares beneficially owned as of the applicable record date in favor of the approval of the Merger Agreement and the transactions contemplated by the Merger Agreement, at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the foregoing matters.

In addition, each Galen Holder has also agreed, during the Voting Period, to vote or execute consents, as applicable, with respect to the Galen Subject Shares beneficially owned by it as of the applicable record date (or cause to be voted or a consent to be executed with respect to the Galen Subject Shares beneficially owned by it as of the applicable record date) against each of the matters set forth in clauses (i) or (ii) below at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the following matters: (i) any action, proposal, transaction or agreement involving the Company or any of its subsidiaries that would reasonably be expected to, in any material respect, prevent, impede, frustrate, interfere with, delay, postpone or adversely affect the Transaction or the other transactions contemplated by the Merger Agreement; or (ii) any Acquisition Proposal (as defined below), other than an Acquisition Proposal made by BCP Holdings.

The Galen Holders have appointed BCP Holdings as their proxy and attorney-in-fact, with full power of substitution and resubstitution, to vote or act by written consent during the Voting Period with respect to the Galen Subject Shares in accordance with the Galen Voting Agreement.

In addition, pursuant to the Galen Voting Agreement, the Galen Holders have agreed, during the Voting Period, not to transfer any or all of the Galen Subject Shares beneficially owned by such Galen Holder or deposit any Galen Subject Shares beneficially owned by such Galen Holder in a voting trust or subject any of such Galen Subject Shares

beneficially owned by such Galen Holder to any arrangement or agreement with any person (other than BCP Holdings) with respect to the voting or the execution of consents with respect to any such Galen Subject Shares that would reasonably be expected to restrict such Galen Holder’s ability to comply with and perform such Galen Holder’s covenants and obligations under the Galen Voting Agreement.

Concurrently with execution of the Merger Agreement, the BCP Acquisition Entities entered into a voting agreement dated as of June 30, 2006, with Kenneth W. Davidson and Harry L. Zimmerman (each a “Management Holder”, and collectively, the “Management Holders”) (the “Management Voting Agreement”), relating to the 791,036 shares of Common Stock beneficially owned by the Management Holders or any shares of Common Stock over which any Management Holder acquires beneficial ownership subsequent to the date of the Management Voting Agreement (collectively, the “Management Subject Shares”). Pursuant to the Management Voting Agreement, and during the Voting Period, each Management Holder has agreed to vote or execute consents with respect to all Management Subject Shares beneficially owned as of the applicable record date in favor of the approval of the Merger Agreement and the transactions contemplated by the Merger Agreement, at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the foregoing matters.

In addition, each Management Holder has also agreed, during the Voting Period, to vote or execute consents, as applicable, with respect to the Management Subject Shares beneficially owned by it as of the applicable record date (or cause to be voted or a consent to be executed with respect to the Management Subject Shares beneficially owned by it as of the applicable record date) against each of the matters set forth in clauses (i) or (ii) below at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the following matters: (i) any action, proposal, transaction or agreement involving the Company or any of its subsidiaries that would reasonably be expected to, in any material respect, prevent, impede, frustrate, interfere with, delay, postpone or adversely affect the Transaction or the other transactions contemplated by the Merger Agreement; or (ii) any Acquisition Proposal, other than an Acquisition Proposal made by BCP Holdings.

The Management Holders have appointed BCP Holdings as their proxy and attorney-in-fact, with full power of substitution and resubstitution, to vote or act by written consent during the Voting Period with respect to the Management Subject Shares in accordance with the Voting Agreement.

Pursuant to the Management Voting Agreement, except for transfers to Permitted Transferees (as defined below), the Management Holders have agreed, during the Voting Period, not to transfer any or all of the Management Subject Shares beneficially owned by such Management Holder or deposit any Management Subject Shares beneficially owned by such Management Holder in a voting trust or subject any of such Management Subject Shares beneficially owned by such Management Holder to any arrangement or agreement with any

person (other than BCP Holdings) with respect to the voting or the execution of consents with respect to any such Management Subject Shares that would reasonably be expected to restrict such Management Holder’s ability to comply with and perform such Management Holder’s covenants and obligations under the Management Voting Agreement.

“Voting Period” means the period from and including June 30, 2006 through and including the earlier to occur of (i) the Effective Time of the Transaction (as defined in the Merger Agreement) and (ii) the termination of the Merger Agreement by the BCP Acquisition Entities or the Company in accordance with its terms.

“Acquisition Proposal” means any proposal or offer (i) relating to a merger, reorganization, consolidation, dissolution, sale of substantial assets, tender offer, exchange offer, recapitalization, liquidation, dissolution, joint venture, share exchange or other business combination involving the Company or any of its subsidiaries, (ii) for the issuance by the Company of 20% or more of its equity securities or (iii) to acquire in any manner, directly or indirectly, 20% or more of the capital stock or assets of the Company or any of its subsidiaries, in each case other than the transactions contemplated by the Merger Agreement.

“Permitted Transferee” means, with respect to any Management Holder, any of the following persons: (i) the spouse of such Management Holder, (ii) the children of such Management Holder, (iii) a trust of which there are no principal beneficiaries other than such Management Holder, such Management Holder’s spouse or such Management Holder’s children, (iv) upon the death of such Management Holder, the beneficiaries under the terms of any trust or will of the Management Holder or by law of intestate succession, and (v) any charitable foundation or similar charitable organization founded and controlled by such Management Holder or the Management Holder jointly (and which remains under the control of such Management Holder or the Management Holder jointly, as applicable).

The consummation of the Transaction will be conditioned upon, among other things: (i) shareholder approval of the Transaction; (ii) the absence of any material adverse effect with respect to the Company; (iii) completion of a tender offer and consent solicitation for all of a Company subsidiary’s outstanding 9.75% senior subordinated notes; and (iv) the expiration or termination of any applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Acts of 1976 and the receipt of other antitrust and regulatory approvals.

The purpose of the Transaction is to acquire 100% of the equity interest in the Company. Concurrently with consummation of the Transaction, it is contemplated that the Common Stock will be delisted from The NASDAQ National Market and will become eligible for termination of registration pursuant to Section 12(g)(4) of the Act.

The articles of incorporation and by-laws, as amended, of BCP Acquisition in effect immediately prior to the Effective Time, will be the articles of incorporation and by-laws of the surviving corporation in the Transaction. Additionally, the directors of BCP Acquisition immediately prior to the Effective Time will be the directors of the surviving corporation in the Transaction.

Other than as described above and in the Merger Agreement, none of the Reporting Persons have any plans or proposals that relate to or would result in any of the actions described in subparagraphs (a) through (j) of Item 4 of Schedule 13D (although they reserve the right to develop such plans or proposals).

References to, and descriptions of, the Merger Agreement, the Galen Voting Agreement and the Management Voting Agreement in this Item 4 are qualified in their entirety by this reference to the Merger Agreement, the Galen Voting Agreement and the Management Voting Agreement, copies of which are filed as Exhibits 2, 3 and 4, respectively, to this Schedule 13D and which are incorporated by reference in this Item 4 in their entirety where such references and descriptions appear.

ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.

(a) and (b). The information contained on the cover pages of this Schedule 13D is incorporated herein by reference. For the purpose of Rule 13d-3 promulgated under the Act, the Reporting Persons, by entering into the Management Voting Agreement and by the BCP Acquisition Entities entering into the Galen Voting Agreement with the Galen Holders, may be deemed to have shared voting power and/or shared dispositive power with respect to (and therefore beneficially own) 10,879,760 shares of Common Stock, representing approximately 15.3% of the total outstanding Common Stock. The calculation of the foregoing percentage is based on 71,004,134 shares of common stock outstanding as of May 1, 2006, based on the Company’s quarterly report on Form 10-Q for the quarterly period ended April 1, 2006 filed with the Securities and Exchange Commission (the “SEC”) on May 10, 2006.

Neither the filing of this Schedule 13D nor any of its contents shall be deemed to constitute an admission by any of the Reporting Persons that it is the beneficial owner of any of the shares of Common Stock referred to herein for purposes of Section 13(d) of the Act, or for any other purpose, and such beneficial ownership is expressly disclaimed. None of the Reporting Persons has beneficial ownership of any shares of Common Stock, except as described in this Schedule 13D.

(c) None of the Reporting Persons has engaged in any transaction during the past 60 days in, any shares of Common Stock, except as described in this Schedule 13D.

(d) Not applicable.

(e) Not applicable.

References to, and descriptions of, the Galen Voting Agreement and Management Voting Agreement in this Item 5 are qualified in their entirety by reference to the Galen Voting Agreement and Management Voting Agreement, copies of which are filed as Exhibits 3 and 4 to this Schedule 13D, respectively, and which are incorporated by reference in this Item 5 in their entirety where such references and descriptions appear.


ITEM 6.		CONTRACTS, ARRANGEMENTS OR UNDERSTANDINGS WITH RESPECT TO SECURITIES OF THE ISSUER.

The responses to Items 3, 4 and 5 of this Schedule 13D and Exhibits 2, 3, and 4 are incorporated herein by reference.

Pursuant to the Merger Agreement, at the Effective Time (as defined in the Merger Agreement), BCP Acquisition will be merged with and into the Company, at which time the separate corporate existence of BCP Acquisition shall cease and the Company shall continue its existence as the surviving corporation (the “Merger”). Upon consummation of the Merger, (i) each share of the common stock, par value $0.01 per share, of BCP Acquisition issued and outstanding immediately prior to the Effective Time shall be converted into and become one fully paid and nonassessable share of common stock, $0.01 par value per share, of the Company; (ii) all shares of Common Stock that are owned by the Company as treasury stock and any shares of Common Stock owned by the BCP Acquisition Entities immediately prior to the Effective Time shall be cancelled and shall cease to exist and no payment shall be made or consideration delivered in respect thereof; and (iii) each share of Common Stock (other than (A) shares to be cancelled (B) shares of Common Stock owned by any wholly-owned subsidiary of the Company, which shall remain outstanding, and (C) dissenting shares issued and outstanding immediately prior to the Effective Time shall be automatically converted as of the Effective Time into the right to receive $6.55 in cash per share, without interest.

Except as set forth in this Schedule 13D, none of the Reporting Persons have any contracts, arrangements, understandings or relationships (legal or otherwise) with any person with respect to any securities of the Company, including but not limited to, transfer or voting of any of the securities of the Company, finders’ fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies, or a pledge or contingency the occurrence of which would give another person voting or investment power over the securities of the Company.

References to, and descriptions of, the Merger Agreement in this Item 6 are qualified in their entirety by reference to the Merger Agreement, a copy of which is filed as Exhibit 2 to this Schedule 13D and which is incorporated by reference in this Item 6 in its entirety where such references and descriptions appear.

ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.

1. Joint Filing Agreement.

2. Agreement and Plan of Merger, dated June 30, 2006, among Grand Slam Holdings, LLC, Grand Slam Acquisition Corp. and Encore Medical Corporation (incorporated by reference to Exhibit 2.1 to the Encore Medical Corporation’s Report on Form 8-K furnished to the SEC on July 3, 2006, File no. 000-26538).

3. Voting Agreement, dated June 30, 2006, among Grand Slam Holdings, LLC, Grand Slam Acquisition Corp., Galen Partners III, L.P., Galen Partners International III, L.P., and Galen Employee Fund III, L.P.

4. Voting Agreement, dated June 30, 2006, among Grand Slam Holdings, LLC, Grand Slam Acquisition Corp., Kenneth W. Davidson and Harry L. Zimmerman.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: July 10, 2006


		KENNETH W. DAVIDSON

		/s/ Kenneth W. Davidson


		HARRY L. ZIMMERMAN

		/s/ Harry L. Zimmerman

EX-99.(1) 2 d37731exv99wx1y.htm JOINT FILING AGREEMENT exv99wx1y

Exhibit 1

JOINT FILING AGREEMENT

In accordance with Rule 13d-1(k)(1) of the Securities Exchange Act of 1934, as amended, the undersigned hereby agree to the joint filing on behalf of each of us of a Schedule 13D relating to the common stock of Encore Medical Corporation, a Delaware corporation, and that any subsequent amendments thereto filed by any of us will be filed on behalf of each of us. This Agreement may be included as an exhibit to such joint filing.


		DATE: July 10, 2006

		KENNETH W. DAVIDSON



		HARRY L. ZIMMERMAN

EX-99.(3) 3 d37731exv99wx3y.htm VOTING AGREEMENT exv99wx3y

Exhibit 3

GALEN VOTING AGREEMENT

This VOTING AGREEMENT (this “Agreement”) is entered into as of June 30, 2006, by and among Grand Slam Holdings, LLC, a Delaware limited liability company (“Parent”), Grand Slam Acquisition Corp., a Delaware corporation (“Merger Sub”), Galen Partners III, L.P., a Delaware limited partnership (“GP III”), Galen Partners International III, L.P., a Delaware limited partnership (“GP Intl III”), and Galen Employee Fund III, L.P., a Delaware limited partnership (“GEF III”) (each of GP III, GP Intl III and GEF III, a “Stockholder” and, together, the “Stockholders”).

W I T N E S S E T H:

WHEREAS, as of the date of this Agreement, the Stockholders beneficially own, in the aggregate, 10,088,724 shares of Common Stock, par value $0.001 per share (the “Common Stock”), of Encore Medical Corporation, a Delaware corporation (the “Company”);

WHEREAS, concurrently herewith, the Company, Parent and Merger Sub are entering into an Agreement and Plan of Merger, dated as of this date, as the same may be amended (the “Merger Agreement”), pursuant to which Merger Sub will merge with and into the Company and the Company will continue its existence as the surviving corporation (the “Merger”), and each share of Common Stock will be converted into the right to receive cash in accordance with the terms of the Merger Agreement; and

WHEREAS, as a condition to the willingness of Parent and Merger Sub to enter into the Merger Agreement, and as an inducement and in consideration therefor, Parent and Merger Sub have required that each of the Stockholders agree, and each of the Stockholders has agreed, to enter into this Agreement.

NOW, THEREFORE, in consideration of the foregoing and the mutual premises, representations, warranties, covenants and agreements contained in this Agreement, the parties, intending to be legally bound, hereby agree as follows:

ARTICLE I
DEFINITIONS

SECTION 1.1 Defined Terms. For purposes of this Agreement, terms used in this Agreement that are defined in the Merger Agreement but not in this Agreement shall have the respective meanings ascribed to them in the Merger Agreement.

SECTION 1.2 Other Definitions. For purposes of this Agreement:

(a) “New Shares” means any shares of capital stock of the Company (other than Owned Shares) over which either Stockholder acquires beneficial ownership at any time from and after the date of this Agreement through the termination of the Voting Period.

(b) “Owned Shares” means all of the shares of Common Stock beneficially owned by the Stockholders as of the date of this Agreement. The Owned Shares consist of: (i) 9,216,431 shares of Common Stock held by GP III, (ii) 834,204 shares of Common Stock held by GP Intl III and 38,089 shares of Common Stock held by GEF III. In the event of a stock dividend or distribution, or any change in the Common Stock by reason of any stock dividend or distribution, split-up,

recapitalization, combination, exchange of shares or the like, the “Owned Shares” shall be deemed to refer to and include the Owned Shares (as defined in the first sentence of this paragraph) as well as all stock dividends and distributions and any securities into which or for which any or all of those Owned Shares may be changed or exchanged or which are received in the transaction.

(c) Representative” means, with respect to any particular person, any director, officer, employee, accountant, consultant, legal counsel, investment banker, advisor, agent or other representatives of that person.

(d) “Transfer” means sell, transfer, tender, pledge, encumber, hypothecate, assign or otherwise dispose, by operation of law or otherwise.

(e) “Voting Period” means the period from and including the date of this Agreement through and including the earlier to occur of (i) the Effective Time and (ii) the termination of the Merger Agreement by Parent or Merger Sub or the Company pursuant to Section 8.1 of the Merger Agreement.

ARTICLE II
VOTING AGREEMENT AND IRREVOCABLE PROXY

SECTION 2.1 Agreement to Vote.

(a) Each of the Stockholders hereby agrees that, during the Voting Period, such Stockholder shall vote or execute consents, as applicable, with respect to the Owned Shares and any New Shares beneficially owned by it as of the applicable record date (or cause to be voted or a consent to be executed with respect to the Owned Shares and any New Shares beneficially owned by it as of the applicable record date) in favor of the approval of the Merger Agreement and the transactions contemplated by the Merger Agreement, at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the foregoing matters.

(b) Each of the Stockholders hereby agrees that, during the Voting Period, such Stockholder shall vote or execute consents, as applicable, with respect to the Owned Shares and any New Shares beneficially owned by it as of the applicable record date (or cause to be voted or a consent to be executed with respect to the Owned Shares and any New Shares beneficially owned by it as of the applicable record date) against each of the matters set forth in clauses (i), (ii) or (iii) below at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the following matters:

(i) any action, proposal, transaction or agreement involving the Company or any of its subsidiaries that would reasonably be expected to, in any material respect, prevent, impede, frustrate, interfere with, delay, postpone or adversely affect the Merger or the other transactions contemplated by the Merger Agreement; or

-2-

(ii) any Acquisition Proposal, other than an Acquisition Proposal made by Parent.

(d) Except as set forth in clauses (a) and (b) of this Section 2.1, no Stockholder shall be restricted from voting in favor of, against or abstaining with respect to any matter presented to the stockholders of the Company. In addition, nothing in this Agreement shall give Parent the right to vote any Owned Shares at any meeting of the stockholders other than as provided in this Section 2.1.

SECTION 2.2 Grant of Irrevocable Proxy. Each of the Stockholders hereby irrevocably appoints Parent as such Stockholder’s proxy and attorney-in-fact, with full power of substitution and resubstitution, to vote or execute consents during the Voting Period, with respect to the Owned Shares and any New Shares beneficially owned by such Stockholder, solely in respect of the matters described in, and in accordance with, Section 2.1. This proxy is given to secure the performance of the duties of such Stockholder under this Agreement. None of the Stockholders shall directly or indirectly grant any person any proxy (revocable or irrevocable), power of attorney or other authorization with respect to any of the Owned Shares or New Shares that is inconsistent with Sections 2.1 and 2.2.

SECTION 2.3 Nature of Irrevocable Proxy. The proxy and power of attorney granted pursuant to Section 2.2 by each of the Stockholders shall be irrevocable during the Voting Period, shall be deemed to be coupled with an interest sufficient in law to support an irrevocable proxy and shall revoke any and all prior proxies granted by such Stockholder, and such Stockholder acknowledges that the proxy constitutes an inducement for Parent and Merger Sub to enter into the Merger Agreement. The power of attorney granted by each of the Stockholders is a durable power of attorney and shall survive the bankruptcy, death or incapacity of such Stockholder. The proxy and power of attorney granted hereunder shall terminate automatically at the expiration of the Voting Period.

ARTICLE III
COVENANTS

SECTION 3.1 Transfer Restrictions. Each of the Stockholders agrees that such Stockholder shall not, and shall not permit any person, directly or indirectly, to:

(a) Transfer any or all of the Owned Shares or New Shares beneficially owned by such Stockholder; provided that the foregoing shall not prevent the conversion of such Owned Shares and New Shares into the right to receive Merger Consideration pursuant to the Merger in accordance with the terms of the Merger Agreement; or

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with respect to the voting or the execution of consents with respect to any such Owned Shares or New Shares that would reasonably be expected to restrict such Stockholder’s ability to comply with and perform such Stockholder’s covenants and obligations under this Agreement.

SECTION 3.2 No Shop Obligations of the Stockholder. Each Stockholder covenants and agrees with Parent that, during the Voting Period, such Stockholder shall not and shall not authorize any of such Stockholder’s Representatives to, directly or indirectly, (i) initiate, solicit, encourage, or knowingly facilitate any inquiry, proposal or offer, or the making, submission or reaffirmation of any inquiry, proposal or offer (including any proposal or offer to the Company’s stockholders), that constitutes or would reasonably be expected to lead to any Acquisition Proposal, or (ii) engage in any discussions or negotiations concerning an Acquisition Proposal. Notwithstanding the foregoing, nothing in this Agreement shall limit, restrict or otherwise affect the actions taken in compliance with the Merger Agreement by any Affiliate of any Stockholder in his capacity as a member of the Board of Directors of the Company or any committee thereof.

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS

Each of the Stockholders hereby, severally but not jointly, represents and warrants to Parent and Merger Sub as follows:

SECTION 4.1 Authorization. Such Stockholder has all legal capacity, power and authority to execute and deliver this Agreement and to perform its obligations hereunder. This Agreement has been duly executed and delivered by such Stockholder and constitutes a legal, valid and binding obligation of such Stockholder, enforceable against such Stockholder in accordance with its terms.

SECTION 4.2 Ownership of Shares. Such Stockholder is the sole beneficial owner of all of such Stockholder’s Owned Shares and has, or will have at the time of any vote with respect to the matters contemplated by Article II, the sole power to vote (or cause to be voted or consents to be executed) and to dispose of (or cause to be disposed of) all of such Owned Shares. Such Stockholder does not own or hold any right to acquire any additional shares of any class of capital stock of the Company or other securities of the Company or any interest therein or any voting rights with respect to any securities of the Company. None of such Stockholder’s Owned Shares are subject to any voting trust agreement or other contract, agreement, arrangement, commitment or understanding to which such Stockholder is a party restricting or otherwise relating to the voting or Transfer of such Stockholder’s Owned Shares. Such Stockholder has good and valid title to such Stockholder’s Owned Shares, free and clear of any and all Liens.

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breach or default) under any of the terms of any agreement or other instrument to which such Stockholder is a party or by which such Stockholder or any of such Stockholder’s Owned Shares is bound, or (B) violate any applicable law, rule, regulation, order, judgment, or decree applicable to such Stockholder, except for any of the foregoing as could not reasonably be expected to impair such Stockholder’s ability to perform its obligations under this Agreement in any material respect.

SECTION 4.4 Reliance by Parent and Merger Sub. Such Stockholder understands and acknowledges that Parent and Merger Sub are entering into the Merger Agreement in reliance upon the execution and delivery of this Agreement by such Stockholder and the agreement by such Stockholder herein to perform such Stockholder’s obligations hereunder and comply with the terms hereof.

ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Each of Parent and Merger Sub hereby represent and warrant to each of the Stockholders that (i) it has all legal capacity, power and authority to execute and deliver this Agreement and to perform its obligations hereunder and (ii) this Agreement has been duly executed and delivered by it and constitutes a legal, valid and binding obligation of the party, enforceable against it in accordance with the terms of this Agreement.

ARTICLE VI
TERMINATION

This Agreement shall terminate upon the expiration of the Voting Period; provided that Sections 7.6 through 7.11 and Sections 7.13 through 7.15 shall survive termination of this Agreement. Notwithstanding the foregoing, termination of this Agreement shall not prevent any party from seeking any remedies (at law or in equity) against any other party for that party’s breach of any of the terms of this Agreement prior to the date of termination.

ARTICLE VII
MISCELLANEOUS

SECTION 7.1 Appraisal Rights. Each of the Stockholders hereby waives any rights of appraisal or rights to dissent from the Merger or the approval of the Merger Agreement that such Stockholder may have under applicable law and shall not permit any such rights of appraisal or rights of dissent to be exercised with respect to any Owned Shares or any New Shares.

SECTION 7.2 Non-Survival of Representations and Warranties. The respective representations and warranties of the Stockholders, Parent and Merger Sub shall not survive the closing of the transactions contemplated hereby and by the Merger Agreement.

SECTION 7.3 Further Actions. Each of the Stockholders agrees that such Stockholder shall take any further action and execute any other documents or instruments as may be necessary to effectuate the intent of this Agreement.

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SECTION 7.4 Fees and Expenses. Except as otherwise expressly set forth in this Agreement, all costs and expenses incurred in connection with this Agreement and the transactions contemplated hereby shall be paid by the party incurring the cost or expense whether or not the Merger is consummated.

SECTION 7.5 Amendments, Waivers, etc. This Agreement may be amended by the parties at any time. This Agreement may not be amended except by an instrument in writing signed on behalf of each of the parties. Any party hereto may (i) extend the time for the performance of any of the obligations or other acts of the other parties hereto, (ii) waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto and (iii) subject to the requirements of applicable law, waive compliance with any of the agreements or conditions contained herein. Any such extension or waiver shall be valid if set forth in an instrument in writing signed by the party or parties to be bound thereby. The failure of any party to assert any rights or remedies shall not constitute a waiver of such rights or remedies.

SECTION 7.6 Notices. All notices, requests, claims, instructions, demands and other communications hereunder shall be in writing and shall be given (and shall be deemed to have been duly given upon receipt) by delivery in person, by facsimile (provided that the facsimile is promptly confirmed by telephone confirmation thereof) or by overnight courier to the respective parties at the following addresses (or at such other address for a party as shall be specified by like notice):


		(a)		If to the Stockholders, addressed to:

				c/o Galen Partners III, L.P.
				610 Fifth Avenue
				New York, New York 10020
				Attention: Zubeen Shroff
				Telecopy: (212) 218-4999

		with a copy (which shall not constitute notice) to:

				Ropes & Gray LLP
				45 Rockefeller Plaza
				New York, New York 10111
				Attention: Merrill A. Ulmer
				Telecopy: (212) 841-5725

		(b)		if to Parent or Merger Sub, addressed to:

				Blackstone Capital Partners V L.P.
				c/o The Blackstone Group
				345 Park Avenue
				New York, New York 10154
				Attention: Chinh E. Chu
				Telecopy: 212-583-5712

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		with a copy to (which shall not constitute notice):

				Simpson Thacher & Bartlett LLP
				425 Lexington Avenue
				New York, New York 10017
				Attention: William R. Dougherty, Esq.
				Telecopy: 212-455-2502

or to that other address as any party shall specify by written notice so given, and notice shall be deemed to have been delivered as of the date so telecommunicated or personally delivered.

SECTION 7.7 Headings; Titles. Headings and titles of the Articles and Sections of this Agreement are for the convenience of the parties only, and shall be given no substantive or interpretative effect whatsoever.

SECTION 7.8 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced by any rule of law or public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect so long as the substance of the transactions contemplated hereby is not affected in any manner adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner to the end that the transactions contemplated hereby are fulfilled to the fullest extent possible.

SECTION 7.9 Entire Agreement. This Agreement (together with the Merger Agreement, to the extent referred to in this Agreement) and any documents delivered by the parties in connection herewith constitute the entire agreement among the parties with respect to the subject matter of this Agreement and supersede all prior agreements and undertakings, both written and oral, among the parties, or any of them, with respect to the subject matter hereof.

SECTION 7.10 Assignment; Binding Effect; No Third Party Beneficiaries; Further Action. Neither this Agreement nor any of the rights, interests or obligations hereunder shall be assigned by any of the parties (whether by operation of law or otherwise) without the prior written consent of the other parties, except that each of Parent and/or Merger Sub may assign, in its sole discretion, any or all of its rights, interests and obligations under this Agreement to any Affiliate of Blackstone Capital Partners V. L.P. This Agreement shall be binding upon and shall inure to the benefit of Parent and Merger Sub and their respective successors and assigns and shall be binding upon the Stockholders and their respective heirs, executors and administrators. This Agreement shall be binding upon and inure solely to the benefit of each party hereto, and nothing in this Agreement, express or implied, is intended to or shall confer upon any other person (other than, in the case of Parent and Merger Sub, their respective successors and assigns and, in the case of the Stockholders, their respective heirs, executors and administrators) any rights, benefits or remedies of any nature whatsoever under or by reason of this Agreement.

SECTION 7.11 Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. Each of the parties hereto (i) consents to

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submit itself to the personal jurisdiction of the United States District Court for the Southern District of New York or any court of the State of New York located in such district in the event any dispute arises out of this Agreement or any of the transactions contemplated by this Agreement, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court and (iii) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than such courts sitting in the State of New York.

SECTION 7.12 Enforcement of Agreement; Specific Performance. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that Parent and Merger Sub shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in the state courts of the State of New York sitting in the City of New York or any court of the United States located in the City of New York, this being in addition to any other remedy to which such party is entitled at law or in equity. The parties agree that the Stockholders shall not be entitled to an injunction or injunctions to prevent any breach of this Agreement by any of Parent or Merger Sub or to enforce specifically any term or any provision of this Agreement.

SECTION 7.13 Counterparts; Facsimiles. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, each of which when executed shall be deemed to be an original but all of which taken together shall constitute one and the same agreement. This Agreement or any counterpart may be executed and delivered by facsimile copies, each of which shall be deemed an original.

SECTION 7.14 WAIVER OF JURY TRIAL. EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT ISSUES, AND THEREFORE IT HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT AND ANY OF THE AGREEMENTS DELIVERED IN CONNECTION HEREWITH OR THE TRANSACTIONS CONTEMPLATED HEREBY OR THEREBY.

SECTION 7.15 Merger Agreement. The obligations of the Stockholders hereunder are subject to the absence of any change (by amendment or waiver) to the Merger Agreement which is materially adverse, directly or indirectly, to the Stockholders, including but not limited to: (i) any change which decreases the Merger Consideration; or (ii) any change to the form of Merger Consideration (other than the addition of consideration payable in any form).

[Signature page follows]

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IN WITNESS WHEREOF, Parent, Merger Sub and the Stockholders have caused this Agreement to be duly executed as of the day and year first above written.


		GRAND SLAM HOLDINGS, LLC

		By:
				Name:
				Title:

		GRAND SLAM ACQUISITION CORP.

		By:
				Name:
				Title:

		GALEN PARTNERS III, L.P.
		By: Claudius, L.L.C., its General Partner

		By:
				Name: Bruce F. Wesson
				Title: Member

		GALEN PARTNERS INTERNATIONAL III, L.P.
		By: Claudius, L.L.C., its General Partner

		By:
				Name: Bruce F. Wesson
				Title: Member

		GALEN EMPLOYEE FUND III, L.P.
		By: Wesson Enterprises, Inc., its General Partner

		By:
				Name: Bruce F. Wesson
				Title: President

[Galen Voting Agreement Signature Page]

EX-99.(4) 4 d37731exv99wx4y.htm VOTING AGREEMENT exv99wx4y

Exhibit 4

MANAGEMENT VOTING AGREEMENT

This VOTING AGREEMENT (this “Agreement”) is entered into as of June 30, 2006, by and among Grand Slam Holdings, LLC, a Delaware limited liability company (“Parent”), Grand Slam Acquisition Corp., a Delaware corporation (“Merger Sub”), Kenneth W. Davidson and Harry L. Zimmerman (each, a “Stockholder” and, together, the “Stockholders”).

W I T N E S S E T H:

WHEREAS, as of the date of this Agreement, the Stockholders beneficially own, in the aggregate, 791,036 shares of Common Stock, par value $0.001 per share (the “Common Stock”), of Encore Medical Corporation, a Delaware corporation (the “Company”);

ARTICLE I
DEFINITIONS

SECTION 1.2 Other Definitions. For purposes of this Agreement:

(a) “Company Options” means options to acquire Common Stock granted to the Stockholders by the Company.

(b) “New Shares” means any shares of capital stock of the Company (other than Owned Shares) over which the Stockholders acquire beneficial ownership at any time from and after the date of this Agreement through the termination of the Voting Period (including Option Shares).

(d) “Owned Shares” means all of the shares of Common Stock beneficially owned by the Stockholders as of the date of this Agreement. The Owned Shares consist of: (i) 568,887 shares of Common Stock held Kenneth W. Davidson and (ii) 222,149 shares of Common Stock held by Harry L. Zimmerman. In the event of a stock dividend or distribution, or any change in the Common Stock by reason of any stock dividend or distribution, split-up, recapitalization, combination, exchange of shares or the like, the “Owned Shares” shall be deemed to refer to and include the Owned Shares (as defined in the first sentence of this paragraph) as well as all stock dividends and distributions and any securities into which or for which any or all of those Owned Shares may be changed or exchanged or which are received in the transaction.

(e) “Permitted Transferee” means, with respect to any Stockholder, any of the following persons: (i) the spouse of such Stockholder, (ii) the children of such Stockholder, (iii) a trust of which there are no principal beneficiaries other than such Stockholder, such Stockholder’s spouse or such Stockholder’s children, (iv) upon the death of such Stockholder, the beneficiaries under the terms of any trust or will of the Stockholder or by law of intestate succession, and (v) any charitable foundation or similar charitable organization founded and controlled by such Stockholder or the Stockholders jointly (and which remains under the control of such Stockholder or the Stockholders jointly, as applicable).

(f) “Representative” means, with respect to any particular person, any director, officer, employee, accountant, consultant, legal counsel, investment banker, advisor, agent or other representatives of that person.

(g) “Transfer” means sell, transfer, tender, pledge, encumber, hypothecate, assign or otherwise dispose, by operation of law or otherwise. For purposes of this Agreement, the Transfer of any Company Option shall be deemed a Transfer of the shares issuable upon the exercise thereof.

(h) “Voting Period” means the period from and including the date of this Agreement through and including the earlier to occur of (i) the Effective Time and (ii) the termination of the Merger Agreement by Parent or Merger Sub or the Company pursuant to Section 8.1 of the Merger Agreement.

ARTICLE II
VOTING AGREEMENT AND IRREVOCABLE PROXY

SECTION 2.1 Agreement to Vote.

(a) Each of the Stockholders hereby agrees that, during the Voting Period, such Stockholder shall vote or execute consents, as applicable, with respect to the Owned Shares and any New Shares beneficially owned by him as of the applicable record date (or cause to be voted or a consent to be executed with respect to the Owned Shares and any New Shares beneficially owned by him as of the applicable record date) in favor of the approval of the Merger Agreement and the transactions contemplated by the Merger Agreement, at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the

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holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the foregoing matters.

(b) Each of the Stockholders hereby agrees that, during the Voting Period, such Stockholder shall vote or execute consents, as applicable, with respect to the Owned Shares and any New Shares beneficially owned by him as of the applicable record date (or cause to be voted or a consent to be executed with respect to the Owned Shares and any New Shares beneficially owned by him as of the applicable record date) against each of the matters set forth in clauses (i), (ii) or (iii) below at any meeting (or any adjournment or postponement thereof) of, or in connection with any proposed action by written consent of, the holders of any class or classes of capital stock of the Company at or in connection with which any of such holders vote or execute consents with respect to any of the following matters:

(ii) any Acquisition Proposal, other than an Acquisition Proposal made by Parent.

(c) Any vote required to be cast or consent required to be executed pursuant to this Section 2.1 shall be cast or executed in accordance with the applicable procedures relating thereto so as to ensure that it is duly counted for purposes of determining that a quorum is present (if applicable) and for purposes of recording the results of that vote or consent. Nothing contained in this Section 2.1 shall require the Stockholders to vote or execute any consent with respect to any Option Shares on or not issued upon the exercise of a Company Option on or prior to the applicable record date for that vote or consent.

SECTION 2.2 Grant of Irrevocable Proxy. Each Stockholder hereby irrevocably appoints Parent as such Stockholder’s proxy and attorney-in-fact, with full power of substitution and resubstitution, to vote or execute consents during the Voting Period, with respect to the Owned Shares and any New Shares beneficially owned by such Stockholder, solely in respect of the matters described in, and in accordance with, Section 2.1. This proxy is given to secure the performance of the duties of such Stockholder under this Agreement. None of the Stockholders shall directly or indirectly grant any person any proxy (revocable or irrevocable), power of attorney or other authorization with respect to any of the Owned Shares or New Shares that is inconsistent with Sections 2.1 and 2.2.

SECTION 2.3 Nature of Irrevocable Proxy. The proxy and power of attorney granted pursuant to Section 2.2 by each of the Stockholders shall be irrevocable during the Voting

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Period, shall be deemed to be coupled with an interest sufficient in law to support an irrevocable proxy and shall revoke any and all prior proxies granted by such Stockholder, and such Stockholder acknowledges that the proxy constitutes an inducement for Parent and Merger Sub to enter into the Merger Agreement. The power of attorney granted by each of the Stockholders is a durable power of attorney and shall survive the bankruptcy, death or incapacity of such Stockholder. The proxy and power of attorney granted hereunder shall terminate automatically at the expiration of the Voting Period.

ARTICLE III
COVENANTS

SECTION 3.1 Transfer Restrictions. Each of the Stockholders agrees that such Stockholder shall not, and shall not permit any person, directly or indirectly, to:

(a) Transfer any or all of the Owned Shares or New Shares beneficially owned by such Stockholder; provided that the foregoing shall not prevent (i) the Transfer of Owned Shares or New Shares to any Permitted Transferee who executes and delivers to Parent an agreement to be bound by the terms of this Agreement to the same extent as such Stockholder, or (ii) the conversion of such Owned Shares and New Shares into the right to receive Merger Consideration pursuant to the Merger in accordance with the terms of the Merger Agreement; or

(b) deposit any Owned Shares or New Shares beneficially owned by such Stockholder in a voting trust or subject any of such Owned Shares or New Shares beneficially owned by such Stockholder to any arrangement or agreement with any person (other than Parent) with respect to the voting or the execution of consents with respect to any such Owned Shares or New Shares that would reasonably be expected to restrict such Stockholder’s ability to comply with and perform such Stockholder’s covenants and obligations under this Agreement.

SECTION 3.2 No Shop Obligations of the Stockholder. Subject to Section 3.3, each of the Stockholders covenants and agrees with Parent that, during the Voting Period, such Stockholder shall not and shall not authorize any of such Stockholder’s Representatives to, directly or indirectly, (i) initiate, solicit, encourage, or knowingly facilitate any inquiry, proposal or offer, or the making, submission or reaffirmation of any inquiry, proposal or offer (including any proposal or offer to the Company’s stockholders), that constitutes or would reasonably be expected to lead to any Acquisition Proposal, or (ii) engage in any discussions or negotiations concerning an Acquisition Proposal. Notwithstanding the foregoing, nothing in this Agreement shall limit, restrict or otherwise affect the actions taken in compliance with the Merger Agreement by any Affiliate of any Stockholder in his capacity, as applicable, as a member of the Board of Directors of the Company or any committee thereof.

SECTION 3.3 Stockholder’s Capacity. Parent and Merger Sub acknowledge that each of the Stockholders is not making any agreement or understanding herein in his capacity as a director or officer of the Company and that the Stockholder is executing this agreement solely in his capacity as the beneficial owner of Common Stock and nothing herein shall limit or affect any actions taken by the Stockholder in his capacity as a director or officer of the Company. Nothing herein shall limit or affect the Company’s rights in connection with the Merger Agreement.

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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS

Each Stockholder hereby, severally but not jointly, represents and warrants to Parent and Merger Sub as follows:

SECTION 4.1 Authorization. Such Stockholder has all legal capacity, power and authority to execute and deliver this Agreement and to perform his obligations hereunder. This Agreement has been duly executed and delivered by such Stockholder and constitutes a legal, valid and binding obligation of such Stockholder, enforceable against such Stockholder in accordance with its terms.

SECTION 4.2 Ownership of Shares. Such Stockholder is the sole beneficial owner of all of such Stockholder’s Owned Shares and Option Shares and has, or will have at the time of any vote with respect to the matters contemplated by Article II, the sole power to vote (or cause to be voted or consents to be executed) and to dispose of (or cause to be disposed of) all of such Owned Shares and, upon their issuance, Option Shares. Such Stockholder does not own or hold any right to acquire any additional shares of any class of capital stock of the Company or other securities of the Company or any interest therein or any voting rights with respect to any securities of the Company. None of such Stockholder’s Owned Shares and Option Shares are subject to any voting trust agreement or other contract, agreement, arrangement, commitment or understanding to which such Stockholder is a party restricting or otherwise relating to the voting or Transfer of such Stockholder’s Owned Shares or Option Shares. Such Stockholder has good and valid title to such Stockholder’s Owned Shares and Company Options, free and clear of any and all Liens.

SECTION 4.3 No Conflicts. Except (a) for a filing of an amendment to a Schedule 13D or Schedule 13G, and (b) for a filing of a Form 4 or Form 5 as required by the Exchange Act, (i) no filing with any Governmental Entity, and no authorization, consent or approval of any other person is necessary for the execution of this Agreement by such Stockholder or the performance by such Stockholder of its obligations hereunder and (ii) none of the execution and delivery of this Agreement by such Stockholder or the performance by such Stockholder of its obligations hereunder shall (A) result in, give rise to or constitute a violation or breach of or a default (or any event which with notice or lapse of time or both would become a violation, breach or default) under any of the terms of any agreement or other instrument to which such Stockholder is a party or by which such Stockholder or any of such Stockholder’s Owned Shares is bound, or (B) violate any applicable law, rule, regulation, order, judgment, or decree applicable to such Stockholder, except for any of the foregoing as could not reasonably be expected to impair such Stockholder’s ability to perform his obligations under this Agreement in any material respect.

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ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

Each of Parent and Merger Sub hereby represent and warrant to each of the Stockholder that (i) it has all legal capacity, power and authority to execute and deliver this Agreement and to perform his obligations hereunder and (ii) this Agreement has been duly executed and delivered by it and constitutes a legal, valid and binding obligation of the party, enforceable against it in accordance with the terms of this Agreement.

ARTICLE VI
TERMINATION

This Agreement shall terminate upon the expiration of the Voting Period; provided that Sections 7.6 through 7.11 and Section 7.13 through 7.15 shall survive termination of this Agreement. Notwithstanding the foregoing, termination of this Agreement shall not prevent any party from seeking any remedies (at law or in equity) against any other party for that party’s breach of any of the terms of this Agreement prior to the date of termination.

ARTICLE VII
MISCELLANEOUS

SECTION 7.1 Appraisal Rights. Each Stockholder hereby waives any rights of appraisal or rights to dissent from the Merger or the approval of the Merger Agreement that such Stockholder may have under applicable law and shall not permit any such rights of appraisal or rights of dissent to be exercised with respect to any Owned Shares or any New Shares.

SECTION 7.3 Further Actions. Each Stockholder agrees that such Stockholder shall take any further action and execute any other documents or instruments as may be necessary to effectuate the intent of this Agreement.

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The failure of any party to assert any rights or remedies shall not constitute a waiver of such rights or remedies.


		(a)		If to the Stockholders, addressed to:

				c/o Grand Slam Corporation
				9800 Metric Blvd.
				Austin, Texas 78758
				Attn: Harry L. Zimmerman, Esq.
				Telecopy: (512) 834-6300

		with a copy (which shall not constitute notice) to:

				Willkie Farr & Gallagher LLP 787 Seventh Avenue
				New York, New York 10019
				Attention: David E. Rubinsky, Esq.
				Telecopy: (212) 728-8111

		(b)		if to Parent or Merger Sub, addressed to:

				Blackstone Capital Partners V L.P.
				c/o The Blackstone Group
				345 Park Avenue
				New York, New York 10154
				Attention: Chinh E. Chu
				Telecopy: 212-583-5712

		with a copy to (which shall not constitute notice):

				Simpson Thacher & Bartlett LLP
				425 Lexington Avenue
				New York, New York 10017
				Attention: William R. Dougherty, Esq.
				Telecopy: 212-455-2502

or to that other address as any party shall specify by written notice so given, and notice shall be deemed to have been delivered as of the date so telecommunicated or personally delivered.

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SECTION 7.11 Governing Law. This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York. Each of the parties hereto (i) consents to submit itself to the personal jurisdiction of the United States District Court for the Southern District of New York or any court of the State of New York located in such district in the event any dispute arises out of this Agreement or any of the transactions contemplated by this Agreement, (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction or venue by motion or other request for leave from any such court and (iii) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than such courts sitting in the State of New York.

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accordingly agreed that Parent and Merger Sub shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in the state courts of the State of New York sitting in the City of New York or any court of the United States located in the City of New York, this being in addition to any other remedy to which such party is entitled at law or in equity. The parties agree that the Stockholders shall not be entitled to an injunction or injunctions to prevent any breach of this Agreement by any of Parent or Merger Sub or to enforce specifically any term or any provision of this Agreement.

[Signature page follows.]

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IN WITNESS WHEREOF, Parent, Merger Sub and the Stockholders have caused this Agreement to be duly executed as of the day and year first above written.


		GRAND SLAM HOLDINGS, LLC

		By:
				Name: Title:

		GRAND SLAM ACQUISITION CORP.

		By:
				Name: Title:

		KENNETH W. DAVIDSON

		By:
				Name: Title:

		HARRY L. ZIMMERMAN

		By:
				Name:
				Title:

[Management Voting Agreement Signature Page]

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