Exhibit 10.8
PURCHASE AGREEMENT
THIS PURCHASE AGREEMENT ("Agreement") is made as of the
31st day of December, 1997, by and among Patriot American Hospitality, Inc.,
a Delaware corporation (the "REIT"), Patriot American Hospitality Operating
Company, a Delaware corporation (the "OPCO") (the REIT and the OPCO, each a
"Company" and collectively the "Companies"), and UBS Limited, an English
corporation ("UBS Limited") and Union Bank of Switzerland, London Branch
("UBS-LB"), acting through its agent UBS Securities LLC (UBS Limited and
UBS-LB being hereinafter collectively called the "UBS Parties" and sometimes
individually, a "UBS Party"). References herein to the "Companies" refer to
the REIT and the OPCO, and those entities respectively owned or controlled by
the REIT or the OPCO.
IN CONSIDERATION of the mutual covenants contained in this
Purchase Agreement, the REIT, the OPCO and the UBS Parties agree as follows:
SECTION 1. Authorization of Sale of the Shares. Subject to
the terms and conditions of this Agreement, the REIT has authorized the
issuance to UBS Limited of up to an aggregate of 3,250,000 shares of common
stock, par value $0.01 per share, of the REIT (the "REIT Shares") and the
OPCO has authorized the issuance to UBS Limited of up to an aggregate of
3,250,000 shares of common stock, par value $0.01 per share (the "OPCO
Shares"), which REIT Shares and OPCO Shares are paired and traded as a unit
consisting of one (1) REIT Share and one (1) OPCO Share (hereinafter each
such paired unit is referred to as a "Paired Share" and the Paired Shares
referred to in this sentence are herein called the "Purchase Shares"). In
addition, the REIT and the OPCO may issue to UBS-LB additional Paired Shares
in settlement of certain of its obligations under the Forward Stock Purchase
Agreement, dated December 31, 1997 (the "Forward Stock Purchase Agreement"),
among the REIT, the OPCO and UBS-LB (the "Additional Shares"). The Purchase
Shares and the Additional Shares are hereinafter collectively called the
"Shares. "
SECTION 2. Agreement to Sell and Purchase the Purchase
Shares. Subject to the terms and conditions of this Agreement, on the Closing
Date (as defined in Section 3 hereof), the Companies will sell to UBS Limited
the Purchase Shares, the number of which shall equal 3,250,000 paired shares
for a per paired share purchase price of $28.8125 per Paired Share.
SECTION 3. Delivery of the Shares at the Closing.
3.1. Closing. The completion of the purchase and sale of
the Purchase Shares (the "Closing") shall occur as soon as practicable, on
such date to be agreed upon among the REIT, the OPCO and the UBS Parties, but
in no event later than the earlier of (i) December 31, 1997 or (ii) three
business days after the execution of this Agreement (hereinafter, the
"Closing Date").
3.2. Conditions. At Closing, the Companies shall deliver or
cause to be delivered to UBS Limited one or more stock certificates
registered in the name of UBS Limited representing the number of Purchase
Shares set forth in Section 2 above.
The obligation of the Companies to complete the sale of the
Purchase Shares and deliver such stock certificate(s) to UBS Limited at the
Closing shall be subject to the following conditions, any one or more of
which may be waived by both of the Companies acting together: (i) receipt by
the Companies of Federal Funds (or other mutually agreed upon form of
payment) in the full amount of the purchase price for the Purchase Shares
being purchased hereunder, (ii) the accuracy in all material respects, as of
the Closing Date, of the representations and warranties made by the UBS
Parties herein and the fulfillment, in all material respects, as of the
Closing Date, of those undertakings of the UBS Parties to be fulfilled prior
to the Closing, (iii) the Forward Stock Purchase Agreement shall have been
fully executed by the parties thereto and (iv) receipt by the Companies of a
cross-receipt with respect to the Purchase Shares executed by UBS Limited.
UBS Limited's obligation to accept delivery of such stock
certificate(s) and to pay for the Purchase Shares evidenced thereby shall be
subject to the following conditions: (i) the accuracy in all material
respects, as of the Closing Date, of the representations and warranties made
by the Companies herein and the fulfillment in all material respects, as of
the Closing Date, of those undertakings of the Companies to be fulfilled
prior to Closing; and (ii) the UBS Parties shall have received all opinions
and certificates to be delivered by the Companies pursuant to this Agreement.
SECTION 4. Representations, Warranties and Covenants of the
Companies. The Companies hereby represent and warrant to, and covenant with,
the UBS Parties as follows:
4.1. Organization and Qualification. The REIT has been
formed as a real estate investment trust under Delaware law pursuant to a
Certificate of Incorporation filed as of January 27, 1983 in the office of
the Delaware Secretary of State, as amended and restated as of July 1, 1997
and filed in the office of the Delaware Secretary of State on such date. The
REIT's existence has not been suspended or terminated nor have any
dissolution, revocation or forfeiture proceedings regarding the REIT been
commenced. The REIT has been duly qualified to do business in each
jurisdiction (i) wherein it owns, leases or manages real property or (ii)
where the failure so to qualify to do business would have a material adverse
effect on the financial condition, business, operations or prospects of the
Companies taken as a whole (a "Material Adverse Effect"). The OPCO has been
duly organized, is validly existing and in good standing under the laws of
Delaware. The OPCO's corporate existence has not been suspended or
terminated, nor have any dissolution, liquidation or forfeiture proceedings
involving the OPCO been commenced. The OPCO has been duly qualified to do
business in each jurisdiction (i) wherein such entity owns, leases or manages
real property or (ii) where the failure so to qualify to do business would
have a Material Adverse Effect.
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4.2. Authorized Capital Stock. The REIT has 1.5 billion
authorized shares as of December 1, 1997, consisting of 650 million REIT
Shares, par value $0.01 per share, 750 million shares of excess stock, par
value $0.01 per share, and 100 million shares of preferred stock, par value
$0.01 per share. The OPCO has authorized capital stock as of December 1, 1997
of 1.5 billion shares, consisting of 650 million OPCO Shares, par value $0.01
per share, 750 million shares of excess stock, par value $0.01 per share and
100 million shares of preferred stock, par value $0.01 per share. As of
December 1, 1997, there were 70,120,137 Paired Shares outstanding, 7,975,970
Paired Shares were reserved for issuance pursuant to equity plans filed
pursuant to the Companies' SEC Filings (as defined below), and 12,795,851
Paired Shares were reserved for issuance upon the election by the Companies
to acquire, in exchange for Paired Shares, units of limited partnership
interest in Patriot American Hospitality Partnership, L.P. and Patriot
American Hospitality Operating Partnership, L.P. tendered by redeeming unit
holders. No preferred shares of the REIT are currently outstanding. The
issued and outstanding Paired Shares of the Companies have been duly
authorized and validly issued, are fully paid and nonassessable, have been
issued in compliance with all federal and state securities laws, were not
issued in violation of or subject to any preemptive rights or other rights to
subscribe for or purchase securities, and conform to the description thereof
included in the Companies' SEC Filings. Other than as described in the
Companies' SEC Filings, the REIT does not have outstanding any options to
purchase, or any preemptive rights or other rights to subscribe for or to
purchase, any securities or obligations convertible into, or any contracts or
commitments to issue or sell, shares of its capital stock or any such
options, rights, convertible securities or obligations. The description of
the REIT's stock, stock bonus and other stock plans or arrangements and the
options or other rights granted and exercised thereunder in the Companies'
SEC Fillings accurately and fairly presents the information required to be
shown with respect to such plans, arrangements, options and rights.
4.3. Issuance, Sale and Delivery of the Shares. The
Purchase Shares to be sold by the Companies have been duly authorized and,
when issued, delivered and paid for in the manner set forth in this
Agreement, will be duly authorized, validly issued, fully paid and
nonassessable, and will conform to the description thereof included in the
Companies' SEC Filings or incorporated by reference in the Registration
Statements, if available. The Additional Shares, if and when issued pursuant
to the Forward Stock Purchase Agreement, will be duly authorized, validly
issued, fully paid and nonassessable, and will conform to the description
thereof included in the Companies' SEC filings or incorporated by reference
in the Registration Statements. None of the Purchase Shares when issued and
delivered to the UBS Parties shall be subject to any lien, security interest,
claim, charge or encumbrance of any nature. No further approval or authority
of the stockholders or the Board of Directors of the REIT or the OPCO will be
required for the issuance and/or sale of the Purchase Shares to be sold by
the Companies as contemplated herein or in the Forward Stock Purchase
Agreement, except such as shall have been obtained on or before the Closing
Date. The issuance and/or sale of the Purchase Shares to the UBS Parties by
the Companies pursuant to this Agreement or the Forward Stock Purchase
Agreement (as the case may be), the compliance by the Companies with the
other provisions of this Agreement or the Forward Stock Purchase Agreement
and the consummation of the other transactions contemplated hereby or thereby
do not require the consent, approval, authorization, registration
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or qualification of or with any governmental authority, except such as shall
have been obtained on or before the Closing Date other than the registration
of the resale of the Shares by the UBS Parties with the Securities and
Exchange Commission (the "SEC") and any required Blue Sky filings with the
States. The Companies meet and will continue to meet the requirements for use
of Form S-3 under the Securities Act and the rules and regulations
promulgated thereunder (the "Rules and Regulations"). The Companies have
filed and will file all documents which are required to file under the
Securities Exchange Act of 1934, as amended (the "Exchange Act") and all such
documents (collectively, together with the Companies' registration statements
filed under the Securities Act which have been declared effective since
January 1, 1997 and have not been withdrawn, the "Companies' SEC Filings")
comply in all material respects with the requirements of the Exchange Act and
the rules and regulations thereunder, as applicable, and none of such
documents, when so filed, contained or will contain any untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, and any documents
so filed and incorporated by reference subsequent to the effective date of
the Registration Statements (as defined in Section 7 below) shall, when they
are filed with the SEC, conform in all material respects with the
requirements of the Securities Act and the Rules and Regulations and the
Exchange Act and the rules and regulations thereunder, as applicable. No
Registration Statement filed in respect of any of the Purchase Shares or
Additional Shares, when so filed, will contain any untrue statement of a
material fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
4.4. Due Execution, Delivery and Performance of the
Agreement. Each Company has full legal right, power and authority to enter
into the Purchase Agreement and the Forward Stock Purchase Agreement and
perform the transactions contemplated hereby and thereby. The Purchase
Agreement and the Forward Stock Purchase Agreement have been duly authorized,
executed and delivered by the Companies. The making and performance of the
Purchase Agreement and the Forward Stock Purchase Agreement by the Companies
and the consummation of the transactions herein and therein contemplated will
not violate any provision of the certificate of incorporation, bylaws, or
other organizational documents, of the Companies, and will not conflict with,
result in the breach or violation of, or constitute, either by itself or upon
notice or the passage of time or both, a default under any material
agreement, mortgage, deed of trust, lease, franchise, license, indenture,
permit or other instrument to which either Company is a party or by which
either Company or its respective properties may be bound or affected, any
statute or any authorization, judgment, decree, order, rule or regulation of
any court or any regulatory body, administrative agency or other governmental
body applicable to either Company or any of its respective properties. No
consent, approval, authorization or other order of any court, regulatory
body, administrative agency or other governmental body is required by or on
the part of either Company for the execution and delivery of this Agreement,
the Forward Stock Purchase Agreement or the consummation of the transactions
contemplated hereby or thereby, except in connection with the filing of any
Registration Statements pursuant to Section 7 below or for compliance with
the Blue Sky laws applicable to the offering of the Shares. Upon the
execution and delivery hereof, each of this Agreement and the Forward Stock
Purchase
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Agreement will constitute the valid and binding obligation of the Company,
enforceable in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium or
similar laws affecting creditors' and contracting parties' rights generally
and except as enforceability may be subject to general principles of equity
(regardless of whether such enforceability is considered in a proceeding in
equity or at law) and except as the enforceability of the indemnification
agreements of the Companies in Section 7.5 hereof may be limited by public
policy.
4.5. Accountants. The Companies' independent certified
public accountants, who have expressed their opinion with respect to the Most
Recent Financial Statements (as defined below) are independent accountants as
required by the Securities Act and the Rules and Regulations. Each Company
shall cause its independent certified public accountants to deliver, on the
effective date of the Registration Statement, and thereafter upon the request
of a UBS Entity (which shall be made no more frequently than once during any
30-day period), a letter stating that such accountants are independent public
accountants within the meaning of the Securities Act and otherwise in
customary form and covering such financial and accounting matters as are then
customarily covered by letters of independent certified public accountants
delivered in connection with secondary public offerings of equity securities
pursuant to a shelf registration statement.
4.6. No Defaults. Except as to defaults, violations and
breaches which individually or in the aggregate would not be material to the
Companies taken as a whole, neither Company is in violation or default of any
provision of its certificate of incorporation or bylaws, or other
organizational documents, and is not in breach of or default with respect to
any provision of any agreement, judgment, decree, order, mortgage, deed of
trust, lease, franchise, license, indenture, permit or other instrument to
which it is a party or by which it or any of its properties are bound; and
there does not exist any state of fact which constitutes an event of default
on the part of the Company as defined in such documents or which, with notice
or lapse of time or both, would constitute such an event of default except
such defaults which individually or in the aggregate would not be material to
the Companies.
4.7. Contracts. Neither Company, nor to the best of the
knowledge of each Company, any other party is in breach of or default under
any contracts to which the REIT is a party except such breach or default
which individually or in the aggregate would not have a Material Adverse
Effect.
4.8. No Actions. There are no legal or governmental
actions, suits or proceedings pending or, to the best of the Companies'
knowledge, threatened to which either Company is or may be a part or of which
property owned or leased by either Company is or may be the subject, or
related to environmental or discrimination matters, which actions, suits or
proceedings might, individually or in the aggregate, prevent or adversely
affect the transactions contemplated by this Agreement or result in a
material adverse change in the condition (financial or otherwise), of the
properties, business, results of operations or prospects of the Company, and
no labor disturbance by the employees of the Companies exists or is imminent
which might be expected to affect
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adversely such condition, properties, business, results of operations or
prospects. Except as may be described in the Companies' SEC Filings, neither
Company is a party or subject to the provisions of any material injunction,
judgment, decree or order of any court, regulatory body administrative agency
or other governmental body.
4.9. Properties. Each Company has good and marketable title
to all the properties and assets reflected as owned by such Company in the
financial statements included in the Most Recent Financial Statements,
subject to no lien, mortgage, pledge, charge or encumbrance of any kind
except (i) those, if any, reflected in such financial statements or the
Companies' SEC Filings, or (ii) those which are not material in amount and do
not adversely affect the use made and promised to be made of such property by
the Company. Each Company holds its leased properties under valid and binding
leases, with such exceptions as are not materially significant in relation to
the business of the Companies. Each Company owns or leases all such
properties as are necessary to its operations as now conducted. The REIT is
qualified as a real estate investment REIT under the Internal Revenue Code of
1986, as amended, with respect to its taxable years ended December 31, 1995
and December 31, 1996, and is organized in conformity with the requirements
for qualification as a real estate investment trust, and its manner of
operation has enabled it to meet the requirements for qualification as a real
estate investment trust as of the date hereof, and its proposed manner of
operation will enable it to meet the requirements for qualification as a real
estate investment trust in the future.
4.10. No Material Change. Since the date of the Most Recent
Financial Statements, and except as otherwise disclosed in the Companies' SEC
Filings as of the Closing Date or in writing to the UBS Parties (i) neither
Company has incurred any liabilities or obligations, indirect, or contingent,
which will have a Material Adverse Effect or entered into any material verbal
or written agreement or other material transaction which is not in the
ordinary course of business (it being agreed that for purposes of this
sentence the REIT's ordinary course of business shall include the acquisition
or disposition, directly indirectly, of real estate properties or businesses
of a type that may be owned by a "real estate investment trust" (as defined
under the Internal Revenue Code) and the OPCO's ordinary course of business
shall include the acquisition or disposition, directly or indirectly of
assets or business related to or engaged in the lodging industry) or which
could reasonably be expected to result in a material reduction in the future
earnings of the Companies; (ii) neither Company has sustained any loss or
interference with its businesses or properties (taken as a whole) from fire,
flood, windstorm, accident or other calamity, whether or not covered by
insurance, which has had a material adverse effect on such business or
properties; (iii) neither Company is in default in the payment of principal
or interest on any outstanding debt obligations; (iv) there has not been any
change in the authorized capital of the Companies or material increase in the
principal amount of outstanding indebtedness of the Companies (other than in
the ordinary course of business); and (v) there has not been any material
adverse change in the condition (financial or otherwise), business,
properties, results of operations or prospects of the Companies.
4.11. Intellectual Property. Each Company believes it has
sufficient trademarks, trade names, patent rights, copyrights, licenses,
approvals and governmental authorizations to
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conduct its businesses as now conducted; and neither Company has knowledge of
any material infringement by it of trademark, trade name rights, patent
rights, copyrights, licenses, trade secrets or other similar rights of
others, and no claim has been made against either Company regarding
trademark, trade name, patent, copyright, license, trade secrecy or other
infringement which could have a Material Adverse Effect.
4.12. Compliance. Neither Company has been advised, nor has
reason to believe, that it is conducting business in compliance with all
applicable laws, rules and regulations of the jurisdictions in which it is
conducting business, including, without limitation, all applicable local,
state and federal environmental laws and regulations; except where failure to
be so in compliance would not materially adversely affect the condition
(financial or otherwise), business, results of operations or prospects of the
Companies.
4.13. Taxes. Each Company has filed all necessary federal,
state and foreign income and franchise tax returns and has paid or accrued
all taxes shown as due thereon (except for those taxes which are being
contested in good faith through appropriate proceedings, for which adequate
reserves have been established and which are either reflected in the Most
Recent Financial Statements or disclosed by the Companies to UBS in writing),
and neither Company has knowledge of any tax deficiency which has been or
might be asserted or threatened against the Company which could have a
Material Adverse Effect.
4.14. Transfer Taxes. On the Closing Date, all stock
transfer or other taxes (other than income taxes) which are required to be
paid in connection with the sale and transfer of the Purchase Shares to be
sold to UBS Limited hereunder will be, or will have been, fully paid or
provided for by the Companies and all laws imposing such taxes will be or
will have been fully complied with.
4.15. Investment Company. Neither of the Companies are
required to register as an "investment company" as such term is defined in
the Investment Company Act of 1940, as amended.
4.16. Insurance. Each Company maintains insurance (or
insurance is maintained on its behalf) of the types and in the amounts
generally deemed adequate under customary industry standards for its
business, including, but not limited to, insurance covering all real and
personal property owned or leased by such Company against theft, damage,
destruction, acts of vandalism and all other risks customarily insured
against, all of which insurance is in full force and effect.
4.17. SEC Filings. The information contained in the
following documents, which the Companies have furnished to the UBS Parties,
or will furnish prior to the Closing, is or will be true and correct in all
material respects as of their respective filing dates:
(a) Joint Annual Report on Form 10-K for the year ended
December 31, 1996, which Joint Annual Report includes
the REIT's and the OPCO's most
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recently available audited financial statements
together with the report thereon of the independent
certified public accountants (the "Most Recent
Financial Statements");
(b) Joint Quarterly Report on Form 10-Q for the quarters
ended March 31, 1997, June 30, 1997 and September 30,
1997;
(c) the Companies' proxy statements on Form 14A relating
to (i) the most recent Annual Meetings of the OPCO's
and the REIT's Stockholders and (ii) any Special
Meetings of the OPCO's Stockholders and the REIT's
Stockholders which occurred during the 12-month
period prior to the date hereof or for which a
meeting date has been fixed and a proxy statement
distributed;
(d) all other documents, if any, filed by or with respect
to the REIT and the OPCO with the SEC since January
1, 1997 pursuant to Sections 13, 15(d) or 16(a) of
the Exchange Act; and
(e) a covenant compliance certification stating that none
of the REIT and the OPCO and their respective
subsidiaries are in default under any of its credit
agreements or other financing arrangements.
4.18. Legal Opinion. Prior to the Closing, counsel to the
Companies will deliver their legal opinions to the UBS Parties in
substantially the forms of Exhibits A-1 and A-2 hereto.
4.19. ERISA. The Companies and their affiliates are in
compliance in all material respects with all applicable provisions of the
Employee Retirement Income Security Act of 1974, as amended and the rules and
regulations promulgated thereunder ("ERISA"). Neither a Reportable Event (as
defined under ERISA) nor a Prohibited Transaction (as defined under ERISA) has
occurred with respect to any Plan (as defined below) of the Companies and/or
their affiliates; no notice of intent to terminate a Plan has been filed nor has
any Plan been terminated within the past five years; no circumstance exists
which constitutes grounds under Section 402 of ERISA entitling the Pension
Benefit Guaranty Corporation ("PBGC") to institute proceedings to terminate, or
appoint a trustee to administer, a Plan, nor has the PBGC instituted any such
proceedings; the Companies and their affiliates have not completely or partially
withdrawn under Sections 4201 or 4202 of ERISA from any Multiemployer Plan (as
defined therein); the Companies and their affiliates have met the minimum
funding requirements of Section 412 of the Internal Revenue Code of 1986, as
amended (the "Code") and Section 302 of ERISA with respect to each Plan and
there is no unfunded current liability (as defined below) with respect to any
Plan; the Companies and their affiliates have not incurred any liability to the
PBGC under ERISA (other than for the payment of premiums under Section 4007 of
ERISA); no part of the funds to be used by the Companies in satisfaction of
their obligations under this Purchase Agreement or the Forward Stock Purchase
Agreement constitute "plan assets" of any "employee benefit plan" within the
meaning of ERISA or of any "plan" within the meaning of Section
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4975(e)(1) of the Code, as interpreted by the Internal Revenue Service and
the U.S. Department of Labor in rules, regulations, releases and bulletins or
as interpreted under applicable case law. As used below, "Plan" means an
"employee benefit plan" or "plan" as described in Section 3(3) of ERISA; and
"unfunded current liability" has the meaning provided in Section 302(d)(8)(A)
of ERISA.
4.20. Certificate. A certificate of each Company executed
by the chief executive, financial or accounting officer of such Company, to
be dated the Closing Date in form and substance satisfactory to the UBS
Parties to the effect that the representations and warranties of the
Companies set forth in this Section 4 are true and correct as of the date of
this Agreement and as of the Closing Date, and such Company has complied with
all the agreements and satisfied all the conditions on its part to be
performed or satisfied on or prior to such Closing Date.
4.21. Environmental Protection. To the knowledge of the
Companies, except as disclosed in the Companies' SEC Filings, none of the
Companies or their affiliates' properties contain any Hazardous Materials
that, under any Environmental Law, (i) would impose liability on the
Companies or any affiliate that is likely to have a material adverse effect
on the condition (financial or other), business, results of operations, or
prospects, of the Companies or (ii) is likely to result in the imposition of
a lien on any material asset owned, directly or indirectly, by the Companies.
To the knowledge of the Companies, neither of the Companies nor any of their
affiliates is subject to any existing, pending or threatened investigation or
proceeding by any governmental agency or authority with respect or pursuant
to any Environmental Law, except any which, if adversely determined, would
not have a Material Adverse Effect. As used herein, "Environmental Laws" mean
all federal, state, local and foreign environmental, health and safety laws,
codes and ordinances and all rules and regulations promulgated thereunder,
including, without limitation laws relating to emissions, discharges,
releases or threatened releases of pollutants, contaminants, chemicals, or
industrial, toxic or hazardous substances or wastes into the environment
(including, without limitation, air, surface water, ground water, land
surface or subsurface strata) or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling of pollutants, contaminants, chemicals, or industrial, solid, toxic
or hazardous substances or wastes; and "Hazardous Material" includes, without
limitation, (i) all substances which are designated pursuant to Section
311(b)(2)(A) of the Federal Water Pollution Control Act ("FWPCA"), 33 U.S.C
Section 1251 et seq.; (ii) any element, compound, mixture, solution, or
substance which is designated pursuant to Section 102 of the Comprehensive
Environmental Response, Compensation and Liability Act ("CERCLA"), 42 U.S.C.
Section 9601 et seq.; (iii) any hazardous waste having the characteristics
which are identified under or listed pursuant to Section 3001 of the Resource
Conservation and Recovery Act ("RCRA"), 42 U.S.C. Section 6901 et seq.; (iv)
any toxic pollutant listed under Section 307(a) of the FWPCA; (v) any
hazardous air pollutant which is listed under Section 112 of the Clean Air
Act, 42 U.S.C. Section 7401 et seq.; (vi) any imminently hazardous chemical
substance or mixture with respect to which action has been taken pursuant to
Section 7 of the Toxic Substances Control Act, 15 U.S.C. Section 2601 et
seq.; and (vii) petroleum, petroleum products, petroleum by-products,
petroleum decomposition by-products, and waste oil.
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SECTION 5. Representations, Warranties and Covenants of
the UBS Parties.
5.1. Investment. UBS Limited and/or UBS-LB represents and
warrants to, and covenants with, the Companies that: (i) UBS Limited, taking
into account the personnel and resources it can practically bring to bear on
the purchase of the Purchase Shares contemplated hereby, is knowledgeable,
sophisticated and experienced in making, and is qualified to make, decisions
with respect to investments in shares presenting an investment decision like
that involved in the purchase of the Purchase Shares, including investments
in securities issued by the Companies, and has requested, received, reviewed
and considered all information it deems relevant in making an informed
decision to purchase the Purchase Shares; (ii) UBS Limited is acquiring the
number of Purchase Shares set forth in Section 2 above in the ordinary course
of its business and for its own account for investment (as defined for
purposes of the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976 and the
regulations thereunder) only and with no present intention of distributing
any of such Purchase Shares or any arrangement or understanding with any
other persons regarding the distribution of such Shares (this representation
and warranty not limiting the rights of either UBS Party to sell pursuant to
any Registration Statement); (iii) neither UBS Party will, directly or
indirectly, sell or otherwise dispose of (or solicit any offers to purchase
or otherwise acquire) any of the Purchase Shares except in compliance with
the Securities Act, the Rules and Regulations and any applicable state
securities or blue sky laws or pursuant to an available exemption or
exclusion therefrom; (iv) each UBS Party has completed or caused to be
completed the Registration Statement Questionnaire and the Stock Certificate
Questionnaire, both attached hereto as Appendix I, for use in preparation of
the Registration Statement and the answers thereto are true and correct to
the best knowledge of the UBS Parties as of the date hereof and will be true
and correct as of the effective date of the Registration Statement; (v) the
UBS Parties have, in connection with their decision to purchase the number of
Purchase Shares set forth in Section 2 above, relied solely upon the
documents identified in Section 4.17, the information referred to in Section
7.7 and the representations and warranties of the Company contained herein;
(vi) each of the UBS Parties is an "accredited investor" within the meaning
of Rule 501 of Regulation D promulgated under the Securities Act and a
"qualified institutional buyer" within the meaning of Rule 144A promulgated
under the Securities Act; (vii) the UBS Parties do not directly or indirectly
have an interest of five percent or more of the Paired Shares outstanding as
shown in the Companies' Quarterly Reports on Form 10-Q for the quarter ended
September 30, 1997 and (viii) the Purchaser understands that the Shares will
contain a legend to the following effect:
THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933. THE SHARES HAVE
BEEN ACQUIRED FOR INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED
OR ASSIGNED IN THE ABSENCE OF AN EFFECTIVE REGISTRATION
STATEMENT FOR THESE SHARES UNDER THE SECURITIES ACT OF 1933 OR
AN OPINION OF THE COMPANY'S COUNSEL THAT REGISTRATION IS NOT
REQUIRED UNDER SAID ACT.
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5.2. Resale. Each UBS Party acknowledges and agrees that
the Shares are not transferable on the books of either the REIT or the OPCO
unless the certificate submitted to the transfer agent evidencing the Shares
is accompanied by a separate officer's certificate: (i) in the form of
Appendix II hereto, (ii) executed by an officer of, or other authorized
person designated by, the UBS Parties, and (iii) to the effect that (A) the
Shares have been sold in accordance with the Registration Statement, the
Securities Act and the Rules and Regulations and any applicable state
securities or blue sky laws or pursuant to valid exemptions or exclusions
therefrom and (B) the requirement under the Securities Act of delivering a
current prospectus has been satisfied. Each UBS Party acknowledges that there
may occasionally be times when the Companies must suspend the right of the
UBS Parties to effect sales of the Shares through use of the Prospectus
forming a part of the Registration Statement until such time as an amendment
to the Registration Statement has been filed by the Companies and declared
effective by the SEC, or until such time as the Companies have filed an
appropriate report with the SEC pursuant to the Exchange Act (each, a
"Black-out Period"); provided that no Black-out Period shall exceed 90
consecutive days. Each UBS Party hereby covenants that it will not sell any
Shares pursuant to said Prospectus during the period commencing at the time
at which the Companies give the UBS Parties written notice of the suspension
of the use of said Prospectus and ending at the time the Companies give the
UBS Parties written notice that the UBS Parties may thereafter effect sales
pursuant to said Prospectus. Each UBS Party further covenants to notify the
REIT and the OPCO promptly of the sale of all of its Shares.
5.3. Due Execution, Delivery and Performance of this
Agreement. The UBS Parties further represent and warrant to, and covenant
with, the Companies that (i) each UBS Party has full right, power, authority
and capacity to enter into this Agreement and to consummate the transactions
contemplated hereby and has taken all necessary action to authorize the
execution, delivery and performance of this Agreement, and (ii) upon the
execution and delivery of this Agreement, this Agreement shall constitute a
valid and binding obligation of the UBS Parties enforceable in accordance
with its terms, except as enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws affecting
creditors' and contracting parties' rights generally and except as
enforceability may be subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at
law) and except as the indemnification agreements of the UBS Parties in
Section 7.5 hereof may be legally unenforceable.
5.4. Residence of UBS Limited. UBS Limited is organized
under the laws of England and has its principal place of business in London.
5.5. Beneficial Ownership of Company Common Stock. The UBS
Parties further represent and warrant to, and covenant with, the Companies
that (i) as of the date of this Agreement and immediately prior to the
purchase and sale of the Purchase Shares, UBS Limited is not a beneficial
owner, as such term is defined by Rule 13d-3 under the Exchange act of more
than five (5) percent of the total number of outstanding shares of any
Company, and (ii) no
11
officer, director or affiliate of UBS Limited is an officer, director or
affiliate of any Company. The term "affiliate" has the meaning set forth in
Rule 405 under the Securities Act.
SECTION 6. Survival of Representations, Warranties and
Agreements. Notwithstanding any investigation made by any party to this
Purchase Agreement, all covenants, agreements, representations and warranties
made by the Companies and the UBS Parties herein and in the certificates for
the Shares delivered pursuant hereto shall survive the execution of this
Purchase Agreement, the Forward Stock Purchase Agreement, the delivery to UBS
Limited of the Purchase Shares being purchased and the payment therefor.
SECTION 7. Registration of the Shares; Compliance with the
Securities Act.
7.1. Registration Procedures and Expenses. The Companies
shall:
(a) within 60 days after receipt of a demand from the UBS
Parties, which demand may not be made within 30 days
after the Closing, prepare and file with the SEC
Registration Statements (as defined below) covering
the resale by the UBS Parties, from time to time, of
the Shares (not to exceed a number of Shares equal to
130% of the number of Purchase Shares) through the
facilities of the New York Stock Exchange, the
automated quotation system of The Nasdaq Stock Market
or the facilities of any other national securities
exchange on which the Paired Share is then traded or
in privately negotiated transactions (the "Initial
Registration Statements"). If the total number of
Shares issued to the UBS Parties hereunder and under
the Forward Stock Purchase Agreement exceeds the
number of Shares covered by the Initial Registration
Statements, then the Companies shall prepare and file
with the SEC such additional Registration Statements
as shall be necessary to cover the resale by UBS-LB
of such excess Shares in the same manner as
contemplated by the Initial Registration Statements
for the Shares covered thereby ("Additional
Registration Statements"); provided that prior to
delivering certificates evidencing any such excess
Shares to UBS-LB, the Companies shall cause such
Registration Statements to have become effective. For
purposes of this Purchase Agreement, "Registration
Statement" means a registration statement under the
Securities Act on Form S-3 covering the resale by one
or both UBS Parties of up to a specified number of
Shares, filed and maintained effective by the
Companies pursuant to the provisions of this Section
7, including the Prospectus (as defined below)
contained therein, any amendments and supplements to
such registration statement, including all
post-effective amendments thereto, and all exhibits
and all material incorporated by reference into such
registration statement;
(b) use all reasonable best efforts to cause the SEC to
notify the Companies of the SEC's willingness to
declare the Initial Registration Statements
12
effective within 60 days after the Registration
Statements are filed by the Companies; provided that
the Companies will use their reasonable best efforts
to cause such Initial Registration Statements to
become effective no later than 90 days after the
Closing Date;
(c) prepare and file with the SEC such amendments and
supplements to the Registration Statements and the
prospectus used in connection therewith (the
"Prospectus") as may be necessary to keep the
Registration Statements effective until the date on
which the Shares may be resold by the UBS Parties
without registration, by reason of Rule 144(k) under
the Securities Act or any other rule of similar
effect;
(d) furnish to the UBS Parties with respect to the Shares
registered under the Registration Statements (and to
each underwriter, if any, of such Shares) such
reasonable number of copies of Prospectuses,
including any supplements and amendments thereto,
promptly following the effectiveness of such
Registration Statements an opinion from counsel to
the Companies covering the matters set forth on
Exhibit B hereto and such other documents as the UBS
Parties may reasonably request, in order to
facilitate the public sale or other disposition of
all or any of the Shares by the UBS Parties;
(e) use their reasonable best efforts to prevent the
happening of any event that would cause such
Registration Statements to contain a material
misstatement or omission or to be not effective and
usable for resale of the Shares during the period
that such Registration Statements are required to be
effective and usable; provided that this paragraph
(e) shall in no way limit the Companies' right to
suspend the right of the UBS Parties to effect sales
under the Registration Statement during any Black-out
Period as specified at Section 5.2 above.
(f) file documents required of the Companies for normal
blue sky clearance in states specified in writing by
the UBS Parties, provided, however, that the
Companies shall not be required to qualify to do
business or consent to service of process in any
jurisdiction in which it is not now so qualified or
has not so consented; and
(g) bear all reasonable out-of-pocket expenses in
connection with the procedures in paragraphs (a)
through (f) of this Section 7.1 and the registration
of the Shares pursuant to the Registration
Statements, including the reasonable fees and
reasonable expenses of counsel or other advisers to
the UBS Parties, other than underwriting discounts,
brokerage fees and commissions incurred by the UBS
Parties, if any.
13
7.2. Covenants in Connection With Registration.
(a) The Companies hereby covenant with the UBS Parties that
(i) the Companies shall not file any Registration Statement or Prospectus
relating to the resale of the Shares or any amendment or supplement thereto,
unless a copy thereof shall have been first submitted to the UBS Parties and
the UBS Parties did not object thereto in good faith (provided that if the
UBS Parties do not object within two business days of receiving any such
material, they shall be deemed to have no objection thereto); (ii) the
Companies shall immediately notify the UBS Parties of the issuance by the SEC
of any stop order suspending the effectiveness of such Registration Statement
or the initiation of any proceedings for such purpose; (iii) the Companies
shall make every reasonable effort to obtain the withdrawal of any order
suspending the effectiveness of such Registration Statement at the earliest
possible moment; (iv) the Companies shall notify the UBS Parties of the
receipt of any notification with respect to the suspension of the
qualification of the Shares for sale under the securities or blue sky laws of
any jurisdiction or the initiation of any proceeding for such purpose; and
(v) the Companies shall as soon as practicable notify the UBS Parties in
writing of the existence of any fact which results in any Registration
Statement, any amendment or post-effective amendment thereto, the Prospectus,
any prospectus supplement, or any document incorporated therein by reference
containing an untrue statement of a material fact or omitting to state a
material fact required to be stated therein or necessary to make the
statements therein not misleading and shall (except during a Black-out
Period) prepare a supplement or post-effective amendment to such Registration
Statement or the Prospectus or any document incorporated therein by reference
or file any other required document so that, as thereafter delivered to the
purchasers of the Shares, the Prospectus will not contain an untrue statement
of a material fact or omit to state any material fact necessary to make the
statements therein not misleading; provided that this clause (v) shall in no
way limit the Companies' right to suspend the right of the UBS Parties to
effect sales under the Registration Statement during any Black-out Period as
specified at Section 5.2 above.
(b) The UBS Parties shall notify the Companies at least two
business days prior to the date on which it intends to commence effecting any
resales of Shares under Registration Statements and if the Companies do not,
within such two-day period, advise the UBS Parties of the existence of any
facts of the type referred to in Section 7.2(a)(v) above, then the Companies
shall be deemed to have certified and represented to the UBS Parties that no
such facts then exist and the UBS Parties may rely on such certificate and
representation in making such sales. The preceding sentence shall in no way
limit the Companies obligations under Section 7.2(a) above.
7.3. Extension of Required Effectiveness. In the event that
the Companies shall give any notice required by Section 7.2(a)(v) hereof, the
period during which the Companies are required to keep such Registration
Statements effective and useable shall be extended by the number of days
during the period from and including the date of the giving of such notice to
and including the date when the UBS Parties are advised in writing by the
Companies that the use of the Prospectuses may be resumed.
14
7.4. Transfer of Shares After Registration. Each UBS Party
agrees that it will not effect any disposition of the Shares or its right to
purchase the Shares that would constitute a sale within the meaning of the
Securities Act or pursuant to any applicable state securities or blue sky
laws except as contemplated in Registration Statements referred to in Section
7.1 or except pursuant to any exemption from the registration requirements of
the Securities Act (including, without limitation, Rule 144 promulgated
thereunder and any successor thereto) and that it will promptly notify the
Company of any changes in the information set forth in any such Registration
Statements regarding the UBS Parties or its Plan of Distribution.
7.5. Indemnification. For the purpose of this Section 7.5,
the term "Registration Statement" shall include any final prospectus,
exhibit, supplement or amendment included in or relating to any Registration
Statement referred to in Section 7.1.
(a) Indemnification by Companies. For purposes of this
Section 7.5, the Companies agree to indemnify and hold harmless the UBS
Parties and as more particularly described herein. The Companies agree to
indemnify and hold harmless the UBS Parties and each person, if any, who
controls either UBS Party within the meaning of the Securities Act, against
any losses, claims, damages, liabilities or expenses, joint or several, to
which the UBS Parties or such controlling person may become subject
(including in settlement of any litigation, if such settlement is effected
with the written consent of the Companies), insofar as such losses, claims,
damages, liabilities or expenses (or actions in respect thereof as
contemplated below) arise out of or are based upon any untrue statement or
alleged untrue statement of any material fact contained in any Registration
Statement, including the Prospectus, financial statements and schedules, and
all other documents filed as a part thereof, as amended at the time of
effectiveness of such Registration Statement, including any information
deemed to be a part thereof as of the time of effectiveness pursuant to
paragraph (b) of Rule 430A, or pursuant to Rule 434, of the Rules and
Regulations, or the Prospectus, in the form first filed with the SEC pursuant
to Rule 424(b) of the Regulations, or filed as part of such Registration
Statement at the time of effectiveness if no Rule 424(b) filing is required,
or any amendment or supplement thereto, or arise out of or are based upon the
omission or alleged omission to state in any of them a material fact required
to be stated therein or necessary to make the statements in any of them not
misleading, and will reimburse each UBS Party and each such controlling
person for any legal and other expenses as such expenses are reasonably
incurred by the UBS Parties or such controlling person in connection with
investigating, defending, settling, compromising or paying any such loss,
claim, damage, liability, expense or action. The Companies will also
indemnify selling brokers, dealers and similar securities industry
professionals participating in the sale or resale of the Shares, their
officers, directors and partners and each person who controls any such person
within the meaning of the Securities Act, provided, however, that the
Companies will not be liable in any such case to the extent that any such
loss, claim, damage, liability or expense arises out of or is based upon an
untrue statement or alleged untrue statement or omission or alleged omission
made in such Registration Statement, such Prospectus or any amendment or
supplement thereto in reliance upon and in conformity with written
information furnished to the Companies (i) by or on behalf of the UBS Parties
expressly for use therein or (ii) any statement or omission in any Prospectus
that is corrected in any subsequent Prospectus that was delivered
15
to a UBS Party prior to the pertinent sale or sales by such UBS Party and not
delivered by such UBS Party in connection with such sale or sales.
(b) Indemnification by UBS Parties. The UBS Parties will
indemnify and hold harmless the Companies, each of their directors, each of
their officers who signed any Registration Statement and each person, if any,
who controls the Companies within the meaning of the Securities Act, against
any losses, claims, damages, liabilities or expenses, joint and several, to
which the Companies, each of their directors, each of their officers who
signed any Registration Statement or any controlling person may become
subject (including in settlement of any litigation, if such settlement is
effected with the written consent of the UBS Parties) insofar as such losses,
claims, damages, liabilities or expenses (or actions in respect thereof as
contemplated below) arise out of or are based upon any untrue or alleged
untrue statement of any material fact contained in such Registration
Statement, such Prospectus, or any amendment or supplement thereto, or arise
out of or are based upon the omission or alleged omission to state therein a
material fact required to be stated therein or necessary to make the
statements therein not misleading, in each case to the extent, but only to
the extent, that such untrue statement or alleged untrue statement or
omission or alleged omission was made in such Registration Statement, such
Prospectus, or any amendment or supplement thereto, in reliance upon and in
conformity with written information furnished to the Companies by or on
behalf of the UBS Parties expressly for use therein, and will reimburse the
Companies, each of their directors, each of their officers who signed such
Registration Statement and each controlling person for any legal and other
expense reasonably incurred by the Companies, each of their directors, each
of their officers who signed such Registration Statement or controlling
person in connection with investigating, defending, settling, compromising or
paying any such loss, claim, damage, liability, expense or action.
(c) Proceedings. Promptly after receipt by an indemnified
party under this Section 7.5 of notice of the commencement of any action,
such indemnified party will, if a claim in respect thereof is to be made
against an indemnifying party under this Section 7.5 notify the indemnifying
party in writing of the commencement thereof; but the omission so to notify
the indemnifying party will not relieve it from any liability which it may
have to any indemnified party for contribution or otherwise than under the
indemnity agreement contained in this Section 7.5 or to the extent it is not
prejudiced as a proximate result of such failure. In case any such action is
brought against any indemnified party and such indemnified party seeks or
intends to seek indemnity from an indemnifying party, the indemnifying party
will be entitled to participate in, and, to the extent that it may wish,
jointly with all other indemnifying parties similarly notified, to assume and
control the defense thereof with counsel reasonably satisfactory to such
indemnified party; provided, however, if the defendants in any such action
include both the indemnified party and the indemnifying party and the
indemnified party shall have reasonably concluded that there may be a
conflict between the positions of the indemnifying party and the indemnified
party in conducting the defense of any such action or that there may be legal
defenses available to it and/or other indemnified parties which are different
from or additional to those available to the indemnifying party, the
indemnified party or parties shall have the right to select separate counsel
to assume such legal defenses and to otherwise participate in the defense
16
of such action on behalf of such indemnified party or parties. Upon receipt
of notice from the indemnifying party to such indemnified party of its
election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to
such indemnified party under this Section 7.5 for any reasonable legal or
other expenses subsequently incurred by such indemnified party in connection
with the defense thereof unless (i) the indemnified party shall have employed
such counsel in connection with the assumption of legal defenses in
accordance with the proviso to the preceding sentence (it being understood,
however, that the indemnifying party shall be not liable for the expenses of
more than one separate counsel, approved by such indemnifying party in the
case of paragraph (a), representing the indemnified parties who are parties
to such action) or (ii) the indemnifying party shall not have employed
counsel reasonably satisfactory to the indemnified party to represent the
indemnified party within a reasonable time after notice of commencement of
action, in each of which cases the fees and expenses of counsel shall be at
the expense of the indemnifying party. Notwithstanding the foregoing, without
the written consent of the indemnified party, the indemnifying party may not
settle or agree to compromise of any such claim or action for which the
indemnified party intends to seek reimbursement from the indemnifying party,
and the indemnified party will permit the indemnifying party to settle or
compromise any such action or suit at the indemnifying party's sole cost and
expense if as a result thereof the indemnified party is provided a full and
unconditional release of such claim or action.
(d) Contribution. If the indemnification provided for in
this Section 7.5 is required by its terms but is for any reason held to be
unavailable to or otherwise insufficient to hold harmless an indemnified
party under paragraphs (a), (b) or (c) of this Section 7.5 in respect of any
losses, claims, damages, liabilities or expenses referred to herein, then
each applicable indemnifying party shall contribute to the amount paid or
payable by such indemnified party as a result of any losses, claims, damages,
liabilities or expenses referred to herein in such proportion as is
appropriate to reflect the relative benefits received by the Companies and
the UBS Parties from the purchase and sale of the Shares and the relative
fault of the Companies and the UBS Parties in connection with the statements
or omissions or inaccuracies in the representations and warranties in this
Agreement which resulted in such losses, claims, damages, liabilities or
expenses, as well as any other relevant equitable considerations. The
respective relative benefits received by the Companies on the one hand and
the UBS Parties on the other shall be deemed to be in the same proportion as
the amount paid by the UBS Parties to the Companies pursuant to this
Agreement for the Shares purchased by the UBS Parties that were sold pursuant
to any Registration Statement bears to the difference (the "Difference")
between the amount the UBS Parties paid for the Shares that were sold
pursuant to such Registration Statement and the amount received by the UBS
Parties from such sale. The relative fault of the Companies and the UBS
Parties shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact or the inaccurate or the alleged
inaccurate representation and/or warranty relates to information supplied by
the Companies or by the UBS Parties and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission. The amount paid or payable by a party as a result of
the losses, claims, damages, liabilities and expenses referred to above shall
be deemed to include, subject to the limitations set forth in
17
paragraph (c) of this Section 7.5 any reasonable legal or other fees or
expenses incurred by such party in connection with investigating or defending
any action or claim. The provisions set forth in paragraph (c) of this
Section 7.5 with respect to notice of commencement of any action shall apply
if a claim for contribution is to be made under this paragraph (d); provided,
however, that no additional notice shall be required with respect to any
action for which notice has been given under paragraph (c) for purposes of
indemnification. The Companies and the UBS Parties agree that it would not be
just and equitable if contribution pursuant to this Section 7.5 were
determined solely by pro rata allocation or by any other method of allocation
which does not take account of the equitable considerations referred to in
this paragraph. Notwithstanding the provisions of this Section 7.5, the UBS
Parties shall not be required to contribute any amount in excess of the
amount by which the aggregate proceeds received by the UBS Parties from the
transactions contemplated hereby exceeds the amount of any damages that the
UBS Parties has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the
Securities Act) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation.
(e) Relationship Between the REIT and the OPCO. The
obligations set forth in this Section 8.5 shall in no way limit the ability
of the parties to allocate liability between themselves.
7.6. Termination of Conditions and Obligations. The
conditions precedent imposed by Section 6 or this Section 7 upon the
transferability of the Shares shall cease and terminate as to any particular
number of the Shares when such Shares may be, and in fact are, sold under
Rule 144(k) promulgated under the Securities Act. Further, as to any
particular number of Shares, the conditions precedent imposed by Section 5 or
this Section 7 on the transferability of such Shares shall cease and
terminate at such earlier time as an opinion of counsel satisfactory to the
Companies and the UBS Parties shall have been rendered to the effect that
such conditions are not necessary in order to comply with the Securities Act
with respect to such Shares. In each such case, the Companies' obligation to
maintain effective Registration Statements with respect to such Shares which
are no longer be subject to the restrictions and limitations of Section 5 and
this Section 7 shall cease.
7.7. Information Available. So long as any Registration
Statement covering the resale of any Shares owned by either UBS Party is
effective, the Companies will furnish to the UBS Parties:
(a) as soon as practicable after available, one copy of
(i) its Joint Annual Report to Stockholders, (ii) its
Joint Annual Report on Form 10-K, (iii) its joint
Quarterly Reports to Stockholders, (iv) its joint
quarterly reports on Form 10-Q, (v) a full copy of
the particular Registration Statements covering the
Shares (the foregoing, in each case, excluding
exhibits) and (vi) upon request, any or all other
public filings under the Exchange Act by the
Companies; and
18
(b) upon the reasonable request of either UBS Party, a
reasonable number of copies of the Prospectuses to
supply to any other party requiring such
Prospectuses;
and the Companies, upon the reasonable request of the UBS Parties, will meet
with the UBS Parties or a representative thereof at the Companies
headquarters to discuss all information relevant for disclosure in such
Registration Statements covering the Shares, subject to appropriate
confidentiality limitations.
7.8. Non-Exclusivity. The rights and remedies provided
under Section 8.5 hereof shall not be in limitation or exclusion of any other
rights or remedies available to a party, whether by agreement, at law, in
equity or otherwise, with respect to the inaccuracy of any representation or
warranty by, or the breach of any covenant of, the other party made herein or
in the Forward Stock Purchase Agreement.
7.9. Notice Requirement. The REIT and the OPCO each
covenants and agrees that it will notify the UBS Parties at any time it
becomes aware that as a result of a change in the REIT's and the OPCO's
capital stock the UBS Parties beneficially hold more than 4.9% of the REIT's
and the OPCO's Paired Shares.
7.10. Transfer of Shares. The Companies covenant and agree
to use their best efforts to cause the transfer agent to effect promptly any
transfer of the Shares requested by the UBS Parties and to cause the transfer
agent to remove promptly the restrictive legend from the Shares upon
presentation to the transfer agent of all necessary documentation.
SECTION 8. Registration Exemptions. For so long as the REIT
and the OPCO are subject to the reporting requirements of Section 13 or 15 of
the Exchange Act, the REIT and the OPCO covenant that they will file the
reports required to be filed by them under the Securities Act and Section
13(a) and 15(d) of the Exchange Act and the rules and regulations adopted by
the Commission thereunder.
SECTION 9. Broker's Fee. Other than any fees payable under
or in connection with the Forward Stock Purchase Agreement, each of the
parties hereto hereby represents that, on the basis of any actions and
agreements by it, there are no brokers or finders entitled to compensation in
connection with the sale or issuance of the Shares to the UBS Parties.
SECTION 10. Notices. All notices, requests, consents and
other communications hereunder shall be in writing, shall be mailed by
first-class registered or certified airmail, by telegram or telecopy or sent
by nationally recognized overnight express courier postage prepaid, and shall
be deemed given when so mailed or for telecopies, when transmitted and
receipt confirmed, and shall be delivered as addressed as follows:
(a) if to the Companies, to:
19
Patriot American Hospitality, Inc.
Patriot American Hospitality Operating Company
0000 Xxxxxxxx Xxxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attn: Xxxx X. Xxxxxxx
Telecopier: 000-000-0000
with a copy so mailed to:
Xxxxxxx, Procter & Xxxx XXX
Xxxxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000-0000
Attn: Xxxxxxx X. Xxxxx, P.C.
Telecopier: 000-000-0000
or to such other person at such other place as the
Companies shall designate to the UBS Parties in
writing; and
(b) if to the UBS Parties, c/o UBS Securities, LLC, 000
Xxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000, Telecopier:
000-000-0000 or at such other address or addresses as
may have been furnished to the Companies in writing.
SECTION 11. Changes. This Agreement may not be modified or
amended except pursuant to an instrument in writing signed by the Companies and
the UBS Parties.
SECTION 12. Headings. The headings of the various sections of
this Agreement have been inserted for convenience of reference only and shall
not be deemed to be part of this Agreement.
SECTION 13. Severability. In case any provision contained in
this Agreement should be invalid, illegal or unenforceable in any respect, the
validity, legality and enforceability of the remaining provisions contained
herein shall not in any way be affected or impaired thereby.
SECTION 14. Governing Law; Jurisdiction.
14.1. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York (without regard to the
conflicts of law principles thereof) and of the federal law of the United States
of America.
14.2. Each of the Companies (i) hereby irrevocably submits to
the jurisdiction of, and agrees that any suit shall be brought in, the state and
federal courts
20
located in the City and County of New York for the purpose of any suit,
action or other proceeding arising out of or based upon this Agreement or the
transactions contemplated hereby and (ii) hereby waives to the extent not
prohibited by applicable law, and agrees not to assert, by way of motion, as
a defense or otherwise, in any such proceeding, any claim that it is not
subject personally to the jurisdiction of the above-named courts, that its
property is exempt or immune from attachment or execution, that any such
proceeding brought in one of the above-named courts is brought in an
inconvenient forum, that the venue of any such proceeding brought in one of
the above-named courts is improper, or that this Agreement, or the
transactions contemplated hereby may not be enforced in or by such court.
SECTION 15. Transfer to Affiliate. Notwithstanding anything
herein to the contrary, UBS Limited may transfer the Purchase Shares to any
affiliate of UBS Limited, together with all of UBS Limited's rights
hereunder; provided that (i) such affiliate shall assume and be subject to
all of UBS Limited's obligations hereunder; (ii) such affiliate shall be an
"accredited investor" within the meaning of Rule 501 of Regulation D
promulgated under the Securities Act; and (iii) such transfer shall be
consistent with the investment representations set forth at Section 6.1
hereto. In the event of such an assignment, such affiliate shall in all
respects be substituted for UBS Limited as a party hereto.
SECTION 16. Counterparts. This Agreement may be executed in
two or more counterparts, each of which shall constitute an original, but all
of which, when taken together, shall constitute but one instrument, and shall
become effective when one or more counterparts have been signed by each party
hereto and delivered to the other parties.
SECTION 17. Waiver of Trial by Jury. EACH PARTY HEREBY
IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE TO JURY TRIAL IN CONNECTION WITH ANY
ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT.
21
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their duly authorized representatives as of the
day and year first above written.
Patriot American Hospitality, Inc.
By:________________________________
Name:
Title:
Patriot American Hospitality Operating Company
By:________________________________
Name:
Title:
UBS Limited
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
Union Bank of Switzerland
London Branch
By:________________________________
Name:
Title:
By:________________________________
Name:
Title:
22
Appendix I
(one of two)
STOCK CERTIFICATE QUESTIONNAIRE
Pursuant to Section 3 of the Agreement, please provide us with the
following information:
1. The exact name that your Shares are to be registered in (this is the
name that will appear on your stock certificate(s)). You may use a
nominee name if appropriate: ____________________________
2. All relationships between each UBS Party and the Registered Holder
listed in response to Item 1 above: ____________________________
____________________________
____________________________
3. The mailing address of the Registered Holder listed in
response to item 1 above: ____________________________
____________________________
____________________________
____________________________
4. The Social Security Number or Tax Identification Number of the
Registered Holder listed in response to item 1 above:
____________________________
Appendix I
(two of two)
REGISTRATION STATEMENT QUESTIONNAIRE
In connection with the preparation of the Registration Statement,
please provide us with the following information:
1. Pursuant to the "Selling Shareholders" section of the
Registration Statement, please state your or your organization's name exactly as
it should appear in the Registration Statement:
2. Please provide the number of shares that you or your
organization will own immediately after Closing, including those Shares
purchased by you or your organization pursuant to this Purchase Agreement and
those shares purchased by you or your organization through other transactions:
3. Have you or your organization had any position, office or
other material relationship within the past three years with the REIT, the OPCO
or any of their affiliates?
_____ Yes _____ No
If yes, please indicate the nature of any such relationships below:
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APPENDIX II
Attention:
PURCHASER'S CERTIFICATE OF SUBSEQUENT SALE
The undersigned, [an officer of, or other person duly
authorized by] _______________________________________ hereby certifies that
he/she [fill in official name of individual or institution] [said institution]
is the Purchaser of the shares evidenced by the attached certificate, and as
such, sold such shares on ________________ in accordance with Registration
Statement
[date]
number ___________________________________________________________________,
[fill in the number of or otherwise identify Registration Statement]
the Securities Act of 1933, as amended, and any applicable state securities or
blue sky laws and the requirement of delivering a current prospectus by the REIT
and the OPCO has been complied with in connection with such sale.
Print or Type:
Name of Purchaser
(Individual or
Institution): ____________________________________
Name of Individual
representing
Purchaser (if an
Institution) ____________________________________
Title of Individual
representing
Purchaser (if an
Institution): ____________________________________
Signature by:
Individual Purchaser
or Individual repre-
senting Purchaser: ____________________________________
EXHIBIT A-1
[Form of Closing Opinion of Counsel to the REIT and the OPCO]
EXHIBIT A-2
[Form of Closing Opinion of Counsel to the REIT and the OPCO]
EXHIBIT B
Opinion Matters for Additional Registration Statements
[opinion paragraphs to be delivered in connection with resale registration
statements]
Each of the REIT and the OPCO is duly organized, validly
existing and in good standing under the laws of the State of Delaware, and each
of the REIT and the OPCO has the requisite corporate power and authority to own
its properties and to conduct is business as presently conducted. The REIT is a
real estate investment trust duly organized, validly existing and in good
standing as a business REIT under the laws of the State of Delaware, and the
REIT has the requisite corporate power and authority to own its properties and
to conduct its business as is presently conducted.
The [Additional] Shares have been duly authorized and are
validly issued, nonassessable and fully paid, and are not subject to any
preemptive or similar rights.
The Registration Statement has been declared effective under
the Securities Act; to our knowledge, no stop order suspending the effectiveness
of the Registration Statement has been issued and no proceedings for that
purpose have been instituted or threatened; and the Registration Statement, the
Final Prospectus, and each amendment thereof or supplement thereto (except for
the financial statements, schedules and the notes thereto and the other
financial data included or incorporated by reference therein, as to which we
express no opinion) comply as to form in all material respects with the
requirements of the Securities Act and the Exchange Act and the respective rules
of the Commission thereunder.
While we have not verified, and are not passing upon and do not assume
any responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration Statement or Final Prospectus, we have
participated in reviews and discussions in connection with the preparation of
the Registration Statement and Final Prospectus, and advise you that, in the
curse of such reviews and discussions, nothing has come tot our attention which
would lead us to believe (i) that the Registration Statement at the time it
became effective (except for the financial statements and the notes thereto and
the other financial data included or incorporated by reference therein, as to
which we express no belief) contained any untrue statement of a material fact or
omitted to state any material fact necessary to make the statements therein not
misleading or (ii)that the Final Prospectus on the date thereof or on the date
of this opinion (except for the financial statements and the notes thereto and
the other financial data included or incorporated by reference therein, as to
which we express no belief) contained any
untrue statement of a material fact or omitted to state any material fact
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading.
