EXHIBIT 1
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VOTING AGREEMENT
This Voting Agreement (this "Agreement"), dated August 18, 2006, is by
and among Lone Star Steakhouse & Saloon, Inc., a Delaware corporation (the
"Company"), Lone Star U.S. Acquisitions LLC, a Delaware limited liability
company (the "Purchaser"), and COI Acquisition Corp., a Delaware corporation and
an affiliate of Purchaser (the "Merger Sub"), and those shareholders of the
Company listed on Schedule I hereto (each, a "Shareholder," and collectively,
the "Shareholders").
WHEREAS, on even date herewith, the Company, the Purchaser and the
Merger Sub are entering into an Agreement and Plan of Merger (the "Merger
Agreement"), pursuant to which the Merger Sub will be merged with and into the
Company (the "Merger");
WHEREAS, each Shareholder owns beneficially and of record the number of
shares of common stock (the "Common Stock") of the Company set forth opposite
such Shareholder's name on Schedule I hereto;
WHEREAS, the Company, the Purchaser, the Merger Sub and the
Shareholders desire to set forth their agreement with respect to the voting of
the Shareholders' shares of Common Stock with respect to the Merger and the
Merger Agreement; and
WHEREAS, in executing and delivering the Merger Agreement, the
Purchaser and the Merger Sub are relying on the agreements contained herein.
NOW, THEREFORE, in consideration of the foregoing, the mutual covenants
and agreements contained herein and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
hereby agree as follows:
1. VOTING OF COMMON STOCK. Each Shareholder hereby severally (and not
jointly) agrees that, during the time this Agreement is in effect, at any
meeting of the shareholders of the Company, however called, or in any other
circumstance in which the vote, consent or approval of shareholders of the
Company, in their capacity as shareholders, is sought, such Shareholder shall
(a) vote such Shareholder's shares of Common Stock to approve and vote in favor
of the Merger Agreement and the transactions contemplated by the Merger
Agreement and any other actions or agreements required in furtherance thereof;
(b) vote such Shareholder's shares of Common Stock against any action or
agreement that would result in a breach of any covenant, representation or
warranty or any other obligation or agreement of the Company under the Merger
Agreement; and (c) vote such Shareholder's shares of Common Stock against any
action or agreement (other than the Merger Agreement or the transactions
contemplated thereby) that would impede, interfere with, delay, postpone or
attempt to discourage the Merger, including, but not limited to: (i) any
extraordinary corporate transaction, such as a merger, consolidation or other
business combination involving the Company or any of its subsidiaries; (ii) a
sale or transfer of a material amount of assets of the Company or any of its
subsidiaries or a reorganization, recapitalization or liquidation of the Company
or any of its subsidiaries; (iii) any change in the management or board of
directors of the Company, except as otherwise agreed to in writing by the
Purchaser;
(iv) any material change in the present capitalization or dividend policy of the
Company; or (v) any other material change in the Company's corporate structure
or business.
2. REVOCATION OF PRIOR PROXIES. Each Shareholder severally (and not
jointly) represents that any proxies heretofore given in respect of such
Shareholder's shares of Common Stock are revocable, and that any such proxies
are hereby revoked.
3. NO INCONSISTENT ARRANGEMENTS. Each Shareholder severally (and not
jointly) hereby covenants and agrees that, except as contemplated by this
Agreement and the Merger Agreement, it shall not (a) except to the Merger Sub,
transfer (which term shall include, without limitation, any sale, gift, pledge
or other disposition) or consent to any transfer of any or all of such
Shareholder's shares of Common Stock or any interest therein unless each Person
(as defined in the Merger Agreement) to which any of such Common Stock, or any
interest in any of such Common Stock, is or may be transferred shall have (i)
executed a counterpart of this Agreement, and (ii) agreed in writing to hold
such Common Stock subject to all of the terms and provisions of this Agreement;
(b) except with the Purchaser, enter into any contract, option or other
agreement or understanding with respect to any transfer of any or all of such
Shareholder's shares of Common Stock or any interest therein; (c) grant any
proxy, power-of-attorney or other authorization in or with respect to such
Shareholder's shares of Common Stock; (d) deposit any of such Shareholder's
shares of Common Stock into a voting trust or enter into a voting agreement or
arrangement with respect to such Shareholder's shares of Common Stock; or (e)
take any other action, in his, her or its capacity as a shareholder, that would
in any way restrict, limit or interfere with the performance of his, her or its
obligations hereunder or the transactions contemplated hereby or which would
make any representation or warranty of such Shareholder hereunder untrue or
incorrect.
4. NO SOLICITATION. Each Shareholder severally (and not jointly), in
his, her or its capacity as a shareholder, hereby agrees that he, she or it
shall not, and shall not permit or authorize any of his, her or its
representatives or agents to, directly or indirectly, encourage, solicit,
initiate or engage in discussions or negotiations with, or furnish any
non-public information regarding the Company or the Transactions (as defined in
the Merger Agreement) to, any Person or group (other than the Purchaser or the
Merger Sub or any of their affiliates or representatives) concerning any Company
Takeover Proposal (as defined in the Merger Agreement), other than in their
capacities as officers and/or directors of the Company and in accordance with
the terms of the Merger Agreement. Each Shareholder will immediately cease any
existing discussions or negotiations with any parties conducted heretofore with
respect to any Company Takeover Proposal.
5. REASONABLE EFFORTS. Subject to the terms and conditions of this
Agreement, each Shareholder severally (and not jointly), in his, her or its
capacity as a shareholder, hereby agrees to use all reasonable efforts to take,
or cause to be taken, all actions, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this Agreement.
Each Shareholder shall promptly consult with the Purchaser and provide any
necessary information and material with respect to all filings made by such
Shareholder with any Governmental
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Authority (as defined in the Merger Agreement) in connection with this Agreement
and the Merger Agreement and the transactions contemplated hereby and thereby.
6. WAIVER OF APPRAISAL RIGHTS. Each Shareholder hereby waives any
rights of appraisal or rights to dissent from the Merger that it may have.
7. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS. Each Shareholder
hereby represents and warrants, severally (and not jointly), to the Purchaser
and the Merger Sub as follows:
(a) Title. Except as set forth on Schedule I hereto, such
Shareholder has good and valid title to such Shareholder's shares of Common
Stock, free and clear of any lien, pledge, charge, encumbrance or claim of
whatever nature.
(b) No Other Rights. Except as set forth on Schedule I hereto,
there are no outstanding options, warrants or rights to purchase or acquire the
shares of Common Stock owned by such Shareholder.
(c) Ownership of Shares. On the date hereof, the shares of Common
Stock owned by such Shareholder are owned of record or beneficially by such
Shareholder and, on the date hereof, except as set forth on Schedule I hereto,
such shares of Common Stock owned by such Shareholder constitute all of the
shares of Common Stock owned of record or beneficially by such Shareholder and
Shareholder does not hold any securities convertible into or exchangeable for
shares of Common Stock. Except as set forth on Schedule I hereto, such
Shareholder has sole voting power and sole power of disposition with respect to
all of the shares of Common Stock owned by such Shareholder, with no
restrictions, subject to applicable federal and state securities laws, on such
Shareholder's rights of disposition pertaining thereto.
(d) Power; Binding Agreement. Such Shareholder has the legal
capacity, and all the necessary power and authority to enter into and perform
all of his, her or its obligations under this Agreement. The execution, delivery
and performance of this Agreement by such Shareholder will not violate any
contract, instrument, arrangement or other agreement to which such Shareholder
is a party including, without limitation, any voting agreement, shareholders
agreement or voting trust. The execution, delivery and performance of this
Agreement by such Shareholder will not violate any law, order, judgment or
decree to which Shareholder is a party. This Agreement has been duly and validly
executed and delivered by such Shareholder, and assuming this Agreement has been
duly and validly authorized, executed and delivered by each party hereto other
than such Shareholder, this Agreement constitutes a valid and binding agreement
of such Shareholder, enforceable against such Shareholder in accordance with its
terms, except that (i) such enforcement may be subject to applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws, now or hereafter in
effect, affecting creditor rights generally; and (ii) the remedy of specific
performance and injunctive and other equitable relief may be subject to
equitable defenses and to the discretion of the court.
8. BINDING ON SUBSEQUENTLY ACQUIRED SHARES OF COMMON STOCK. Each
Shareholder agrees that any shares of Common Stock of the Company to which
Shareholder purchases or with respect to which such Shareholder otherwise
acquires beneficial ownership or
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voting rights, directly or indirectly, after the date of this Agreement,
including, without limitation, shares issued upon the conversion, exercise or
exchange, as the case may be, of securities held by such Shareholder that are
convertible into, or exercisable or exchangeable for, shares of Common Stock,
shall be subject to the terms and conditions of this Agreement to the same
extent as if such shares of Common Stock were included on Schedule I hereto.
9. MISCELLANEOUS.
(a) Counterparts. This Agreement may be executed in one or more
counterparts, each of which together shall be deemed an original, but all of
which together shall constitute one and the same instrument.
(b) Governing Law. This Agreement shall be deemed to be made in,
and in all respects shall be interpreted, construed and governed by and in
accordance with the internal laws of, the State of Delaware, without regard to
the conflicts of law principles thereof.
(c) Amendment. This Agreement may be amended only by means of a
written amendment signed by all of the parties hereto.
(d) Successors; Assigns; Transferees. The provisions of this
Agreement shall be binding upon the successors, assigns and transferees of each
of the parties hereto.
(e) Specific Performance. Each Shareholder acknowledges and agrees
that the failure of such Shareholder to perform the provisions of this Agreement
in accordance with their specific terms or to otherwise breach such provisions
will cause irreparable injury to the Purchaser and the Merger Sub, for which
damages, even if available, will not be an adequate remedy. Accordingly, each
Shareholder hereby consents to the issuance of injunctive relief by any court of
competent jurisdiction to compel performance of such Shareholder's obligations,
including an injunction to prevent breaches, and to the granting by any such
court of the remedy of specific performance of the terms and conditions hereof.
(f) Termination. This Agreement shall terminate upon the earliest
to occur of (i) the termination of the Merger Agreement in accordance with its
terms, (ii) the Effective Time (as defined in the Merger Agreement), (iii) at
such time as the Board of Directors of the Company (x) withdraws or modifies its
approval of the Merger Agreement or the Transactions or its recommendation that
shareholders of the Company adopt the Merger Agreement and approve the
Transactions or (y) recommends or approves any Company Takeover Proposal and
(iv) at such time as the Merger Agreement is amended in any respect or the
Company waives any of its rights under the Merger Agreement.
(g) Exercise of Fiduciary Duties. Notwithstanding anything herein
to the contrary, nothing set forth herein shall in any way restrict any officer
or director of the Company in the exercise of his or her fiduciary duties as an
officer or director of the Company.
(h) Notices. all notices or communications hereunder shall be in
writing (including facsimile or similar writing) addressed as follows:
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To the Shareholders:
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At the addresses set forth on Schedule I hereto.
To the Purchaser or the Merger Sub:
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c/o Hudson Advisors, L.L.C.
000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxx X. Xxxxxx, Esq.
Facsimile: (000) 000-0000
with a copy to:
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Jenkens & Xxxxxxxxx, P.C.
0000 Xxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
Attention: Xxxxxx X. XxXxxxxxx, Esq.
Xxxxxxx X. Xxxxxxx, Esq.
Facsimile: (000) 000-0000
To the Company:
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Lone Star Steakhouse & Saloon, Inc.
000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxx 00000
Attention: Xxxx X. Xxxxx
Facsimile: (000) 000-0000
with a copy to:
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Xxxxxx Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP
Park Avenue Tower
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxxxxx, Esq.
Facsimile: (000) 000-0000
All notices and other communications hereunder shall be in writing and shall be
deemed to have been duly given when delivered in person, by facsimile, receipt
confirmed, or on the next business day when sent by overnight courier or on the
second succeeding business day when sent by registered or certified mail
(postage prepaid, return receipt requested).
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
the date first written above.
LONE STAR STEAKHOUSE & SALOON, INC.
By: /s/ Xxxx X. Xxxxx
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Name: Xxxx X. Xxxxx
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Title: Executive Vice President and
Chief Financial Oficer
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LONE STAR U.S. ACQUISITIONS LLC
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
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Title: Vice President
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COI ACQUISITION CORP.
By: /s/ Xxxx X. Xxxxxx
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Name: Xxxx X. Xxxxxx
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Title: Vice President
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/s/ Xxxxx X. Xxxxxxx
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Xxxxx X. Xxxxxxx
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SCHEDULE I
NAME AND ADDRESS OF STOCKHOLDER NUMBER OF SHARES
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Xxxxx X. Xxxxxxx 2,395,393 shares*
c/o Lone Star Steakhouse & Saloon, Inc. Options to purchase 1,227,389 shares
000 Xxxx Xxxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxx 00000
* Does not include 177,145 shares held by Intrust Bank as trustee of a Rabbi
Trust for the Company.
