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Exhibit 10.1
SECURITIES PURCHASE AGREEMENT
SECURITIES PURCHASE AGREEMENT dated as of October 31, 1996
(this "Agreement"), by and between Doubletree Corporation, a Delaware
corporation (the "Seller"), and the Trustees of General Electric Pension
Trust, a New York common law trust (the "Buyer"). Capitalized terms used and
not otherwise defined herein shall have the respective meanings ascribed to
them in the Merger Agreement referred to below.
RECITALS
WHEREAS, the Seller, RLH Acquisition Corp., a Delaware
corporation and a wholly owned subsidiary of the Seller ("Merger Sub"), and Red
Lion Hotels, Inc., a Delaware corporation ("Red Lion"), are parties to an
Agreement and Plan of Merger dated as of September 12, 1996 (the "Merger
Agreement"), pursuant to which Merger Sub will merge with and into Red Lion
(the "Merger") and Red Lion will become a wholly owned subsidiary of the
Seller; and
WHEREAS, in order to finance a portion of the Cash
Consideration payable under the Merger Agreement and other fees and expenses
related to the Merger, the Seller wishes to issue and sell to the Buyer or an
affiliate thereof, and the Buyer wishes to purchase (or to cause an affiliate
of the Buyer to purchase) from the Seller, (i) the number of shares of Common
Stock, par value $.01 per share, of the Seller ("Common Stock") determined in
accordance with Section 1.2 below (the "Shares") and (ii) warrants,
substantially in the form attached hereto as Exhibit A, entitling the holders
thereof to purchase an aggregate of 10% of such number of Shares (the
"Warrants"), all upon the terms and subject to the conditions set forth herein;
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth
herein, the parties hereto hereby agree as follows:
ARTICLE I
PURCHASE AND SALE OF SECURITIES
Section 1.1 Purchase and Sale of Securities. Upon the terms
and subject to the conditions set forth in
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this Agreement, the Buyer agrees to purchase (or to cause an affiliate of the
Buyer to purchase) from the Seller, and the Seller agrees to issue and sell to
the Buyer or such affiliate, the Shares and the Warrants (collectively, the
"Securities"), for an aggregate purchase price of $100,000,000 in immediately
available funds (the "Purchase Price").
Section 1.2 Elected Price. The actual number of Shares
purchased hereunder shall be equal to the quotient (rounded to the nearest
whole number) of the Purchase Price divided by the "Elected Price" determined
as follows:
(a) The Seller has heretofore notified the Buyer that the
expected date of the Closing under the Merger Agreement is November 8, 1996.
The Seller shall use its best efforts to notify the Buyer of any changes
hereafter in the expected date of the Closing (the original notice, and each
notice of change, of the expected date of the Closing, a "Closing Date
Notice").
(b) The parties have agreed that, at or prior to the close of
business on the twentieth day immediately prior to the date on which the
Closing occurs (the "Closing Date"), the Buyer shall be entitled to elect a per
Share purchase price (the "Elected Price") consisting of either (i) the
Acquisition Price (as defined below), or (ii) the Market Price (as defined
below), by giving written notice to the Seller of its election thereof (an
"Election Notice"). For purposes hereof:
"Acquisition Price" means an implied price per share of Common
Stock equal to the product obtained by multiplying (i) a fraction, the
numerator of which is the initial Exchange Ratio or 0.2398 and the
denominator of which is the final adjusted Exchange Ratio, by (ii)
$36.7253. For purposes of illustration, assuming that the Final
Parent Stock Price were $45 (resulting in a final adjusted Exchange
Ratio of 0.2153), then the Acquisition Price would be equal to $40.90.
All calculations of the Acquisition Price shall be made in a manner
consistent with the foregoing illustration.
"Market Price" means (A) if the Seller shall consummate an
underwritten public offering of at least $100,000,000 of its Common
Stock at or immediately prior to the Closing, the per share price at
which shares of Common Stock are sold to the underwriters (e.g. net
of any underwriting discounts) in connection with such underwritten
public offering, or (B) otherwise, the Final Parent Stock Price under
the Merger Agreement.
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(c) The Buyer has delivered an Election Notice dated October
10, 1996 in which it elected the Acquisition Price to be the Elected Price.
The Buyer shall be entitled hereafter to change its election with respect to
the Elected Price by delivering one or more subsequent Election Notices,
specifying a different Elected Price. If the actual Closing Date is three (3)
or more days later than November 8, 1996, the last Election Notice received by
the Seller not less than 20 business days (as defined in the Merger Agreement)
prior to the actual Closing Date shall supercede all other Election Notices
given hereunder, and the Elected Price determined in accordance with such last
Election Notice shall be final and binding upon the parties hereto.
Section 1.3 Closing. Subject to the satisfaction or waiver
of the conditions to closing set forth in Article IV hereof, the closing of the
purchase and sale of the Securities hereunder shall take place at the time,
date and place of the Closing under the Merger Agreement. At the Closing, (a)
the Seller shall issue and deliver to the Buyer (or an affiliate thereof
designated by the Buyer) one or more certificates representing each of the
Securities, all registered in the name of the Buyer or such affiliate, against
(b) payment by the Buyer or such affiliate, as the case may be, to the Seller
of the Purchase Price by wire transfer of immediately available funds to an
account or accounts designated by the Seller in a written notice delivered to
the Buyer not later than two (2) business days prior to the Closing Date.
ARTICLE II
REPRESENTATIONS AND WARRANTIES
Section 2.1 Representations and Warranties of the Seller. The
Seller hereby represents and warrants to the Buyer as follows:
(a) Organization and Power. The Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
State of Delaware, and has all requisite corporate power and authority
to execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby.
(b) Authorization and Enforceability. The execution,
delivery and performance of this Agreement by the Seller and the
consummation of the transactions pursuant hereto have been duly and
validly authorized by all necessary corporate action on the part of
the Seller. This Agreement has been duly executed and
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delivered by the Seller and constitutes the legal, valid and binding
obligation of the Seller, enforceable against the Seller in accordance
with its terms, except as such enforceability may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights generally
or by the application of general principles of equity (regardless of
whether such equitable principles are applied in a proceeding at law
or in equity).
(c) No Conflict. Subject to making the filings and obtaining
the approvals identified in the next paragraph, the execution and
delivery of this Agreement by the Seller do not, and the performance
by the Seller of its obligations hereunder and the consummation by the
Seller of the transactions pursuant hereto will not, (i) conflict with
or violate the certificate of incorporation or by-laws of the Seller,
(ii) conflict with or violate any law, statute, rule, regulation,
order, judgment, writ, injunction or decree applicable to the Seller,
or (iii) result in any violation or breach of, or constitute a default
under, any agreement, contract or other instrument to which the Seller
is a party.
(d) Consents and Approvals. The execution and delivery
of this Agreement by the Seller do not, and the performance by the
Seller of its obligations hereunder and the consummation by the Seller
of the transactions pursuant hereto will not, require the Seller to
obtain any consent, approval, authorization or permit of, or to make
any filing with or notification to, any Governmental Entity or other
Person except as required by the HSR Act, the Securities Act, the
Exchange Act and Blue Sky Laws.
(e) Litigation. There is no action, suit, claim or
proceeding pending or, to the knowledge of the Seller, threatened
against the Seller or any of its subsidiaries by or before any court
or other Governmental Entity which seeks to enjoin or prohibit the
performance by the Seller of its obligations hereunder or the
consummation by the Seller of any of the transactions pursuant hereto.
(f) Title to Securities. (i) The Shares have been duly
authorized and, when issued in accordance with this Agreement, will be
validly issued, fully paid and nonassessable and subject to no
preemptive rights. Upon issuance of the Shares to the Buyer or its
affiliate as aforesaid, the Buyer or such affiliate (as the case may
be) will acquire good and marketable title
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to the Shares, free and clear of any liens and encumbrances.
(ii) The Warrants have been duly authorized and, when issued
in accordance with this Agreement, will be validly issued. Upon
issuance of the Warrants to the Buyer or its affiliate as aforesaid,
the Buyer or such affiliate (as the case may be) will acquire good and
marketable title to the Warrants, free and clear of any liens and
encumbrances. At all times following the Closing during which any
Warrants are outstanding and exercisable, the Seller will reserve and
keep available out of its authorized Common Stock, solely for issuance
and delivery upon exercise of Warrants, at least the number of shares
of Common Stock issuable upon exercise of all then outstanding
Warrants. The shares of Common Stock that are issued upon exercise of
Warrants will, when issued in accordance with the terms thereof, be
duly authorized, validly issued, fully paid, nonassessable, subject to
no preemptive rights, and free and clear of any liens or encumbrances.
(g) Use of Proceeds. The Purchase Price will be used solely
to pay a portion of the Cash Consideration and other fees and expenses
related to the Merger.
(h) Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in
connection with the issuance and sale of Securities pursuant hereto
based upon arrangements made by or on behalf of the Seller.
(i) Full Disclosure. No representation or warranty by
the Seller contained in this Agreement or in the Registration
Statement on Form S-3 (File No. 333-13161), as amended, of the Seller
contains any untrue statement of a material fact by the Seller or
omits to state a material fact required to be stated therein or
necessary to make the statements contained therein by the Seller, in
light of the circumstances under which it was made, not false or
misleading.
Section 2.2 Representations and Warranties of the Buyer. The
Buyer hereby represents and warrants to the Seller as follows:
(a) Organization and Power. The Buyer is a common law trust
duly organized, validly existing and in good standing under the laws
of the State of New York, and has all requisite power and authority to
execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby.
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(b) Authorization and Enforceability. The execution,
delivery and performance of this Agreement by the Buyer and the
consummation of the transactions pursuant hereto have been duly and
validly authorized by all necessary action on the part of the Buyer.
This Agreement has been duly executed and delivered by the Buyer and
constitutes the legal, valid and binding obligation of the Buyer,
enforceable against the Buyer in accordance with its terms, except as
such enforceability may be limited by any applicable bankruptcy,
insolvency, reorganization, moratorium or other similar laws affecting
the enforcement of creditors' rights generally or by the application
of general principles of equity (regardless of whether such equitable
principles are applied in a proceeding at law or in equity).
(c) No Conflict. Subject to making the filings and obtaining
the approvals identified in the next paragraph, the execution and
delivery of this Agreement by the Buyer do not, and the performance by
the Buyer of its obligations hereunder and the consummation by the
Buyer or its affiliate of the transactions pursuant hereto will not,
(i) conflict with or violate the trust instrument or other
organization documents of the Buyer or any such affiliate, (ii)
conflict with or violate any law, statute, rule, regulation, order,
judgment, writ, injunction or decree applicable to the Buyer or any
such affiliate, or (iii) result in any violation or breach of, or
constitute a default under, any agreement, contract or other
instrument to which the Buyer or any such affiliate is a party.
(d) Consents and Approvals. The execution and delivery
of this Agreement by the Buyer do not, and the performance by the
Buyer of its obligations hereunder and the consummation by the Buyer
or its affiliate of the transactions pursuant hereto will not, require
the Buyer or any such affiliate to obtain any consent, approval,
authorization or permit of, or to make any filing with or notification
to, any Governmental Entity or other Person except as required by the
HSR Act, the Securities Act, the Exchange Act and Blue Sky Laws.
(e) Litigation. There is no action, suit, claim or
proceeding pending or, to the knowledge of the Buyer, threatened
against the Buyer or any of its subsidiaries by or before any court or
other Governmental Entity which seeks to enjoin or prohibit the
performance by the Buyer of its obligations hereunder or the
consummation by the Buyer or its affiliate of any of the transactions
pursuant hereto.
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(f) Investment Intent. The Securities are being acquired by
the Buyer or an affiliate thereof for the account of the Buyer or such
affiliate, as the case may be, without a present view to the
distribution or resale thereof or of any interest therein (it being
understood that the Buyer or any such affiliate shall have the right
to sell or otherwise dispose of any such Securities or any Common
Stock deliverable upon exercise of the Warrants, pursuant to
registration or an exemption therefrom under the Securities Act and
Blue Sky Laws).
(g) Brokers. No broker, finder or investment banker is
entitled to any brokerage, finder's or other fee or commission in
connection with the purchase of Securities pursuant hereto based upon
arrangements made by or on behalf of the Buyer or any affiliate
thereof.
ARTICLE III
COVENANTS
Section 3.1 Further Assurances. Each of the parties hereto
shall use all commercially reasonable good faith efforts to take, or cause to
be taken, all actions, and do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations (including, without
limitation, under the HSR Act, the Securities Act, the Exchange Act and Blue
Sky Laws), and consult with and fully cooperate with and provide reasonable
assistance to each other party hereto and their respective Representatives in
order, to consummate and make effective the transactions contemplated hereby as
promptly as practicable hereafter.
Section 3.2 Expenses. The Seller shall bear all expenses
incurred by the parties hereto in connection with this Agreement or any of the
transactions contemplated hereby.
ARTICLE IV
CONDITIONS
Section 4.1 Conditions. The obligation of the Seller to
issue and sell the Securities to the Buyer or an affiliate thereof designated
by the Buyer, and the obligation of the Buyer to purchase (or to cause an
affiliate thereof to purchase) the Securities hereunder, shall be subject to
the satisfaction at or prior to the Closing of the following conditions, either
or both of which
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may be waived, in whole or in part, to the extent permitted by applicable law:
(a) any waiting period (and any extension thereof) under the
HSR Act applicable to the issuance and sale of the Securities shall
have expired or been terminated; and
(b) the Closing under the Merger Agreement shall have
occurred.
Section 4.2 Additional Buyer Conditions. The obligation of
the Buyer to purchase, or to cause an affiliate to purchase, the Securities
hereunder shall also be subject to the following conditions, any or all of
which may be waived, in whole or in part, to the extent permitted by applicable
law:
(a) each of the representations and warranties of the
Seller contained in this Agreement shall be true and correct as of the
Closing Date as though made on and as of the Closing Date (except
where the failure to be so true and correct would not, individually or
in the aggregate, have a Parent Material Adverse Effect), and the
Buyer and any such affiliate shall have received a certificate
executed by an executive officer of the Seller to such effect;
(b) the Buyer or any such affiliate shall have received
an opinion or opinions, in form and substance reasonably satisfactory
to the Buyer or such affiliate, dated the Closing Date, from the
General Counsel of the Seller or Xxxxx Xxxxxxxxxx, special counsel to
the Seller, to the effect that:
(i) the Seller is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware,
and has all requisite corporate power and authority to execute and
deliver this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby.
(ii) the execution, delivery and performance of this
Agreement by the Seller and the consummation of the transactions
pursuant hereto have been duly and validly authorized by all necessary
corporate action on the part of the Seller; this Agreement has been
duly executed and delivered by the Seller and constitutes the legal,
valid and binding obligation of the Seller, enforceable against the
Seller in accordance with its terms, except as such enforceability may
be limited by applicable bankruptcy, insolvency, reorganization,
moratorium or other similar laws affecting the
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enforcement of creditors' rights generally or by the application of
general principles of equity (regardless of whether such equitable
principles are applied in a proceeding at law or in equity);
(iii) the Shares have been duly authorized and, when issued in
accordance with this Agreement, will be validly issued, fully paid and
nonassessable and, to the knowledge of such counsel, subject to no
preemptive rights;
(iv) the Warrants have been duly authorized and, when
issued in accordance with this Agreement, will be validly issued; and
the shares of Common Stock that are issued upon exercise of the
Warrants will, when issued in accordance with the terms of the
Warrants, be validly issued, fully paid and nonassessable and, to the
knowledge of such counsel, subject to no preemptive rights; and
(v) assuming the accuracy of the representations and
warranties of the Buyer set forth in Section 2.2(f) hereof, the
issuance, sale and delivery of the Securities by the Seller are exempt
from registration under the Securities Act; and
(c) the Seller shall have entered into the Registration
Rights Agreement (or another agreement, in form and substance
reasonably satisfactory to the Buyer, providing for the Shares and any
shares of Common Stock issuable upon exercise of the Warrants to be
covered by the existing registration rights of the Buyer under the
"Existing Agreement" referred to in the form of Registration Rights
Agreement attached as Exhibit B to the Merger Agreement).
Section 4.3 Additional Seller Condition. The obligation of
the Seller to issue and sell the Securities hereunder shall also be subject to
the condition that each of the representations and warranties of the Buyer
contained in this Agreement shall be true and correct as of the Closing Date as
though made on and as of the Closing Date (except where the failure to be so
true and correct would not, individually or in the aggregate, have a material
adverse effect on the ability of the Buyer to perform its obligations hereunder
or the ability of the Buyer or any affiliate thereof to consummate the
transactions pursuant hereto), and the Seller shall have received a certificate
executed by a trustee of the Buyer to such effect.
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ARTICLE V
MISCELLANEOUS
Section 5.1 Notices. All notices and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given when delivered by hand or when mailed by registered or
certified mail, postage prepaid, or when given by facsimile transmission, as
follows:
(a) If to the Seller:
Doubletree Corporation
000 Xxxxx 00xx Xxxxxx
Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telecopy No.: (000) 000-0000
Attention: Chief Financial Officer
(b) If to the Buyer:
General Electric Investment Corporation
0000 Xxxxxx Xxxxxx
X.X. Xxx 0000
Xxxxxxxx, Xxxxxxxxxxx 00000
Telecopy No.: (000) 000-0000
Attention: Xxxxx X. Xxxxxxxxxx
or to such other person as either party hereto shall designate by written
notice to the other in the manner provided in this Section 5.1.
Section 5.2 Limited Liability. Any monetary obligation or
liability of the Buyer under this Agreement shall be enforced solely against
the assets of the Buyer and not against the Trustees of the Buyer or General
Electric Company or any affiliate thereof.
Section 5.3 Entire Agreement. This Agreement (including the
documents specifically referred to herein) constitutes the entire agreement
between the parties hereto with respect to the subject matter hereof, and
supersedes all prior agreements and understandings between the parties with
respect thereto.
Section 5.4 Amendments. This Agreement may only be amended
or modified in an instrument executed by both parties hereto. This Agreement
may not be assigned, in whole or in part, by either party hereto without the
prior written consent of the other party hereto.
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Section 5.5 Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of New York, without
giving effect to the conflict of law principles thereof.
Section 5.6 Counterparts. This Agreement may be executed by
the parties in two counterparts, each of which when so executed shall be an
original and all of which together shall constitute one and the same
instrument.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be duly executed as of the date and year first written above.
DOUBLETREE CORPORATION
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Sr. Vice President
TRUSTEES OF GENERAL ELECTRIC
PENSION TRUST
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
Title: Trustee
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