EXHIBIT 1.1
Interstate Hotels & Resorts, Inc.(1)
9,500,000 Shares
Common Stock
($0.01 par value)
Underwriting Agreement
New York, New York
November __, 2003
Citigroup Global Markets Inc.
Credit Lyonnais Securities (USA) Inc.
XX Xxxxx Securities Corporation
c/o Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Interstate Hotels & Resorts, Inc., a corporation organized under the laws of the
State of Delaware (the "Company"), proposes to sell to you (collectively, the
"Underwriters"), 8,500,000 shares of Common Stock, $0.01 par value (the "Common
Stock"), of the Company in the amounts specified in Schedule I hereto, and the
persons named in Schedule II hereto (the "Selling Stockholders") propose to sell
to the Underwriters 1,000,000 shares of Common Stock (said shares to be issued
and sold by the Company and shares to be sold by the Selling Stockholders
collectively being hereinafter called the "Underwritten Securities"). The
Company also proposes to grant to the Underwriters an option to purchase up to
1,425,000 additional shares of Common Stock to cover over-allotments (the
"Option Securities"; the Option Securities, together with the Underwritten
Securities, being hereinafter called the "Securities"). The use of the neuter in
this Agreement shall include the feminine and masculine wherever appropriate.
Any reference herein to the terms "amend", "amendment" or "supplement" with
respect to the Registration Statement, any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the filing of any document
under the Exchange Act after the Effective Date of the Registration Statement,
or the issue date of any Preliminary Prospectus or the Prospectus, as the case
may be, deemed to be incorporated therein by reference. It is understood that in
connection with the offering and sale of the Securities the form of prospectus
for purposes of distribution to Canadian Persons shall have a Canadian
"wrap-around." Certain terms used herein are defined in Section 17 hereof.
1. Representations and Warranties.
(i) The Company represents and warrants, and agrees with
each Underwriter as set forth below in this Section 1.
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(1) Plus an option to purchase from the Company up to 1,425,000 additional
Securities to cover over-allotments.
(a) The Company has all requisite corporate power and
authority, and has taken all corporate action necessary, to execute,
deliver and perform this Agreement. This Agreement has been duly
authorized, executed and delivered by the Company.
(b) The Company meets the requirements for use of Form
S-3 under the Act and has prepared and filed with the Commission a
registration statement (file no. 333-110046) on Form S-3, including a
related preliminary prospectus, for registration under the Act of the
offering and sale of the Securities. The Company has filed one or more
amendments thereto, including a related preliminary prospectus, each of
which has previously been furnished to you. The Company will next file
with the Commission one of the following: either (1) prior to the
Effective Date of such registration statement, a further amendment to
such registration statement (including the form of final prospectus) or
(2) after the Effective Date of such registration statement, a final
prospectus in accordance with Rules 430A and 424(b). In the case of
clause (2), the Company has included in such registration statement, as
amended at the Effective Date, all information (other than Rule 430A
Information) required by the Act and the rules thereunder to be
included in such registration statement and the Prospectus. As filed,
such amendment and form of final prospectus, or such final prospectus,
shall contain all Rule 430A Information, together with all other such
required information, and, except to the extent the Underwriters shall
agree in writing to a modification, shall be in all substantive
respects in the form furnished to the Underwriters prior to the
Execution Time or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other
changes (beyond that contained in the latest Preliminary Prospectus) as
the Company has advised the Underwriters, prior to the Execution Time,
will be included or made therein.
(c) On the Effective Date and on the date any
post-effective amendment becomes effective, the Registration Statement
did or will, and when the Prospectus is first filed (if required) in
accordance with Rule 424(b) and on the Closing Date (as defined herein)
and on any date on which Option Securities are purchased, if such date
is not the Closing Date (a "settlement date"), the Prospectus (and any
supplements thereto) will, comply in all material respects with the
applicable requirements of the Act and the Exchange Act and the
respective rules thereunder; on the Effective Date and at the Execution
Time, the Registration Statement did not or will not contain any untrue
statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein not misleading; and, on the Effective Date, the
Prospectus, if not filed pursuant to Rule 424(b), will not, and on the
date of any filing pursuant to Rule 424(b) and on the Closing Date and
any settlement date, the Prospectus (together with any supplement
thereto) will not, include any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading; provided, however, that the Company makes no
representations or warranties as to the information contained in or
omitted from the Registration Statement or the Prospectus (or any
supplement thereto) in reliance upon and in conformity with information
furnished in writing to the Company by or on behalf of the Underwriters
specifically for inclusion in the Registration Statement or the
Prospectus (or any supplement thereto).
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(d) Each of the Company and each of its Significant
Subsidiaries (as such term is defined in Rule 1-02 of Regulation S-X.)
(the "Significant Subsidiaries") has been duly formed or incorporated
and is validly existing as a limited liability company, limited
partnership or corporation, as the case may be, in good standing under
the laws of the jurisdiction in which it is chartered or organized with
full limited liability company, limited partnership or corporate power
and authority to own or lease, as the case may be, and to operate its
properties and conduct its business as described in the Prospectus,
except where the failure to be so qualified would not reasonably be
expected to have a material adverse effect on the condition (financial
or otherwise), prospects, earnings, business or properties of the
Company and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business (a "Material
Adverse Effect"), and is duly qualified to do business as a foreign
limited liability company, limited partnership or corporation and is in
good standing under the laws of each jurisdiction which requires such
qualification, except where the failure to be so qualified would not
reasonably be expected to have a Material Adverse Effect.
(e) All the outstanding shares of capital stock,
membership interests or partnership interests of each of the Company,
each Significant Subsidiary and BridgeStreet Corporate Housing
Worldwide, Inc. ("BridgeStreet") have been duly and validly authorized
and issued and are fully paid and nonassessable, and, except as
otherwise set forth in the Prospectus, all outstanding shares of
capital stock, membership interests or partnership interests of the
Significant Subsidiaries and BridgeStreet are owned by the Company
either directly or through wholly owned subsidiaries free and clear of
any perfected security interest or any other security interests,
claims, liens or encumbrances other than security interests granted
under the Senior Secured Credit Agreement, dated July 31, 2002, among
the Company, Xxxxxx Brothers, Inc., Societe Generale, XX Xxxxx
Securities Corporation, Xxxxxxx Xxxxx Xxxxxx, Inc., Credit Lyonnais New
York Branch, The Bank of Nova Scotia and the various other lenders and
parties named therein (the "Senior Credit Facility"). The Company owns,
directly or indirectly, shares of capital stock, membership interests
or partnership interests in certain entities as described under the
heading "Business - Hotel Management - Joint Ventures" of the
Registration Statement (such entities, the "Joint Ventures"), free and
clear of any perfected security interest or any other security
interests, claims, liens or encumbrances other than (i) security
interests granted to lenders to such Joint Ventures for financing of
acquisitions and (ii) security interests granted under the Senior
Credit Facility.
(f) The Company's authorized equity capitalization is as
set forth in the Prospectus; the capital stock of the Company conforms
in all material respects to the description thereof contained in the
Prospectus; the outstanding shares of Common Stock (including the
Securities being sold hereunder by the Selling Stockholders) have been
duly and validly authorized and issued and are fully paid and
nonassessable; the Securities being sold hereunder by the Company have
been duly and validly authorized, and, when issued and delivered to and
paid for by the Underwriters pursuant to this Agreement, will be fully
paid and nonassessable; the Securities being sold by the Selling
Stockholders are duly listed, and admitted and authorized for trading,
on the New York Stock Exchange and the Securities being sold hereunder
by the Company are duly listed, and admitted and authorized for
trading, subject to official notice of issuance, on the New
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York Stock Exchange; the certificates for the Securities are in valid
and sufficient form; the holders of outstanding shares of capital stock
of the Company are not entitled to preemptive or other rights to
subscribe for the Securities, except for such rights of the Selling
Stockholders as have been effectively waived (except with respect to
the Securities being sold hereunder by the Selling Stockholders); and,
except as set forth in the Prospectus, no options, warrants or other
rights to purchase, agreements or other obligations to issue, or rights
to convert any obligations into or exchange any securities for, shares
of capital stock of or ownership interests in the Company are
outstanding.
(g) There is no franchise, contract or other document of
a character required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit thereto, which is not
described or filed as required; and the statements in the Prospectus
under the headings "Risk Factors - Our relationship with Meristar
Hospitality may lead to general conflicts of interest that adversely
affect stockholders' interest", "Risk Factors - We may be adversely
affected by the limitations in our franchising and licensing
agreements", "Risk Factors - Costs of compliance with environmental
laws and regulations could adversely affect operating results", "Risk
Factors - Aspects of hotel, resort, conference center, corporate
housing and restaurant operations are subject to government
regulations, and changes in regulations may have significant effects on
business", "Risk Factors - Our stockholders rights plan, the
anti-takeover defense provisions of our charter documents and the large
ownership stake of an investor group may deter potential acquirors and
depress our stock price", "Risk Factors - Our ability to utilize some
of our net operating loss carryforwards may be limited", "Business -
Relationship with MeriStar Hospitality", "Business - Intellectual
Property and Franchises," "Business - Governmental Regulation",
"Business - The Operating Partnership", "Management - Our Board
Composition Agreement", "Certain Relationships and Related Transactions
- Registration Rights Agreement", "Description of Capital Stock", and
"United States Federal Income Tax Consequences", insofar as such
statements summarize legal matters, agreements, documents or
proceedings discussed therein, are, in all material respects, accurate
and fair summaries of such legal matters, agreements, documents or
proceedings.
(h) Neither the Company nor any of its Significant
Subsidiaries is or, after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in
the Prospectus, will be required to be registered as an "investment
company" as defined in the Investment Company Act of 1940, as amended,
and the rules and regulations of the Commission promulgated thereunder.
(i) No consent, approval, authorization, filing with or
order of any court or governmental agency or body is required in
connection with the transactions contemplated herein, except such as
have been obtained or given and such as may be required from the New
York Stock Exchange, Inc., the National Association of Securities
Dealers, Inc. or under the blue sky laws of any jurisdiction and the
federal and/or provincial laws of Canada in connection with the
purchase and distribution of the Securities by the Underwriters in the
manner contemplated herein and in the Prospectus.
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(j) Neither the issue and sale of the Securities nor the
consummation of any other of the transactions herein contemplated nor
the fulfillment of the terms hereof will conflict with, result in a
breach or violation of, or imposition of any lien, charge or
encumbrance upon any property or assets of the Company, any of its
Significant Subsidiaries or BridgeStreet pursuant to, (i) the charter
or by-laws (or equivalent) of the Company or any of its Significant
Subsidiaries, (ii) the terms of any indenture, contract, lease,
mortgage, deed of trust, note agreement, loan agreement or other
agreement, obligation, condition, covenant or instrument to which the
Company, any of its Significant Subsidiaries or BridgeStreet is a party
or bound or to which its or their property is subject or (iii) any
statute, law, rule, regulation, judgment, order or decree applicable to
the Company or any of its Significant Subsidiaries or BridgeStreet or
of any court, regulatory body, administrative agency, governmental
body, arbitrator or other authority having jurisdiction over the
Company, any of its Significant Subsidiaries or BridgeStreet, or any of
their respective properties.
(k) Except as disclosed in or contemplated by the
Registration Statement and Prospectus, no holders of securities of the
Company have rights to the registration of such securities under the
Registration Statement, except for such rights of the Selling
Stockholders, as have been effectively waived (except with respect to
the Securities being sold hereunder by the Selling Stockholders).
(l) The consolidated historical financial statements and
schedules of the Company and its consolidated subsidiaries included in
the Prospectus and the Registration Statement present fairly in all
material respects the financial condition, results of operations and
cash flows of the Company and its subsidiaries as of the dates and for
the periods indicated, comply as to form with the applicable accounting
requirements of the Act and have been prepared in conformity with
generally accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted therein).
The additional selected financial data set forth under the caption
"Selected Historical Condensed Consolidated Financial Information" and
included in the financial statements in the Prospectus and Registration
Statement fairly present, in all material respects, on the basis stated
in the Prospectus and the Registration Statement, the information
included therein. The pro forma financial statements included in the
Prospectus and the Registration Statement (including, without
limitation, under the heading "Unaudited Pro Forma Combined Financial
Information" and under the financial statements) include assumptions
that provide a reasonable basis for presenting the significant effects
directly attributable to the transactions and events described therein,
the related pro forma adjustments give appropriate effect to those
assumptions and the pro forma adjustments reflect the proper
application of those adjustments to the historical financial statement
amounts in the pro forma financial statements included in the
Prospectus and the Registration Statement. The pro forma financial
statements included in the Prospectus and the Registration Statement
comply as to form in all material respects with the applicable
accounting requirements of Regulation S-X under the Act and the pro
forma adjustments have been properly applied to the historical amounts
in the compilation of those statements. Since the latest date of the
financial statements included or incorporated by reference in the
Prospectus and the Registration Statement, neither the Company, any of
its Significant Subsidiaries nor BridgeStreet has incurred any material
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loss or interference in its business from fire, explosion, flood or
other calamity, whether or not covered by insurance, or from any labor
dispute or court or governmental action, order or decree, other than as
described in or contemplated by the Registration Statement or the
Prospectus; and, since such date, there has not been any change in the
capital stock or long-term debt of the Company, its Significant
Subsidiaries or BridgeStreet or any Material Adverse Effect, other than
as described in or contemplated by the Prospectus and the Registration
Statement.
(m) Except as disclosed in the Registration Statement and
the Prospectus, no action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator involving the
Company or any of its Significant Subsidiaries or its or their property
is pending or, to the Company's knowledge, threatened that (i) would
reasonably be expected to have a material adverse effect on the
performance of this Agreement or the consummation of any of the
transactions contemplated hereby; or (ii) would reasonably be expected
to have a Material Adverse Effect.
(n) Each of the Company and each of its Significant
Subsidiaries own or lease all such properties as are necessary to the
conduct of its operations as presently conducted.
(o) Neither the Company nor any Significant Subsidiary is
in violation or default of (i) any provision of its charter or bylaws
(or equivalent), (ii) other than as described in or contemplated by the
Registration Statement and the Prospectus, the terms of any indenture,
contract, lease, mortgage, deed of trust, note agreement, loan
agreement or other agreement, obligation, condition, covenant or
instrument to which it is a party or bound or to which its property is
subject or (iii) any statute, law, rule, regulation, judgment, order or
decree of any court, regulatory body, administrative agency,
governmental body, arbitrator or other authority having jurisdiction
over the Company or such Subsidiary or any of its properties, as
applicable, except in the case of clauses (ii) and (iii) of this
Section where such violation(s) or default(s) would not, individually
or in the aggregate, reasonably be expected to have a Material Adverse
Effect.
(p) KPMG LLP and PriceWaterhouseCoopers LLP, who have
certified certain financial statements of the Company and its
consolidated subsidiaries and delivered their respective report with
respect to the audited consolidated financial statements and schedules
included in the Prospectus, are independent public accountants with
respect to the Company within the meaning of the Act and the applicable
published rules and regulations thereunder during the respective
periods covered by the financial statements on which they reported.
(q) There are no transfer taxes or other similar fees or
charges under Federal law or the laws of any state, or any political
subdivision thereof, required to be paid in connection with the
execution and delivery of this Agreement or the issuance by the Company
or sale by the Company of the Securities.
(r) The Company and each of its subsidiaries has filed
all foreign, federal, state and local tax returns that are required to
be filed or has requested extensions thereof
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(except in any case in which the failure so to file would not
reasonably be expected to have a Material Adverse Effect and except as
set forth in or contemplated in the Prospectus (exclusive of any
supplement thereto)) and has paid all taxes required to be paid by it
and any other assessment, fine or penalty levied against it, to the
extent that any of the foregoing is due and payable, except for any
such assessment, fine or penalty that is currently being contested in
good faith or as would not reasonably be expected to have a Material
Adverse Effect. Each Significant Subsidiary that is a partnership or
limited liability company will be treated as a partnership, and not as
an association taxable as a corporation or a publicly traded
partnership, for federal income tax purposes.
(s) Except as disclosed in the Registration Statement and
the Prospectus, no labor problem or dispute with the employees of the
Company or any of its Significant Subsidiaries exists or, to the
Company's knowledge, is threatened or imminent, except where such
dispute would not reasonably be expected to have a Material Adverse
Effect.
(t) Except as disclosed in the Registration Statement and
the Prospectus: (i) the Company and each of its subsidiaries are
insured by insurers of recognized financial responsibility against such
losses and risks and in such amounts as are prudent and customary in
the businesses in which they are engaged; (ii) all policies of
insurance insuring the Company or any of its subsidiaries or their
respective businesses, assets, employees, officers and directors are in
full force and effect, except where such failure(s) to be in full force
and effect would not reasonably be expected to have a Material Adverse
Effect; the Company and its subsidiaries are in compliance with the
terms of such policies and instruments, except where the failure(s) to
be in compliance would not reasonably be expected to have a Material
Adverse Effect; (iii) there are no claims by the Company or any of its
subsidiaries under any such policy or instrument as to which any
insurance company is denying liability or defending under a reservation
of rights clause, except where such denial(s) or reservation(s) would
not reasonably be expected to have a Material Adverse Effect; and (iv)
neither the Company nor any subsidiary has been refused any insurance
coverage sought or applied for; and neither the Company nor any
subsidiary has any reason to believe that: it will not be able to,
renew its existing insurance coverage as and when such coverage
expires, except where such refusal or failure to renew would not
reasonably be expected to have a Material Adverse Effect, or to obtain
similar coverage from similar insurers as may be necessary to continue
its business at a cost that would not reasonably be expected to have a
Material Adverse Effect.
(u) Except as provided in the Senior Credit Facility, no
Significant Subsidiary or BridgeStreet is currently prohibited,
directly or indirectly, from paying any dividends to the Company, from
making any other distribution on such Significant Subsidiary's capital
stock, membership interests or partnership interests, from repaying to
the Company any loans or advances to such Significant Subsidiary from
the Company or from transferring any of such Significant Subsidiary's
property or assets to the Company or any other Significant Subsidiary,
except as described in or contemplated by the Prospectus (exclusive of
any supplement thereto).
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(v) The Company and its subsidiaries possess all material
licenses, certificates, permits and other authorizations (including,
without limitation, related to brokerage) issued by the appropriate
federal, state or foreign regulatory authorities necessary to conduct
their respective businesses except where the failure to posses such
licenses, certificates, permits and authorizations would not reasonably
be expected to have a Material Adverse Effect, and neither the Company
nor any subsidiary has received any notice of proceedings relating to
the revocation or modification of any such certificate, authorization
or permit which, individually or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would reasonably be expected
to have a Material Adverse Effect.
(w) The Company, BridgeStreet and each of the Company's
Significant Subsidiaries maintain a system of internal accounting
controls sufficient to provide reasonable assurance that (i)
transactions are executed in accordance with management's general or
specific authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles and to maintain asset accountability;
(iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with the existing assets at
reasonable intervals and appropriate action is taken with respect to
any differences.
(x) The Company has not taken, directly or indirectly,
any action designed to or that would constitute or that would
reasonably be expected to cause or result in, under the Exchange Act or
otherwise, stabilization or manipulation of the price of any security
of the Company to facilitate the sale or resale of the Securities.
(y) The Company and its subsidiaries are (i) in
compliance with any and all applicable foreign, federal, state and
local laws and regulations relating to the protection of human health
and safety, the environment or hazardous or toxic substances or wastes,
pollutants or contaminants ("Environmental Laws"), (ii) have received
and are in compliance with all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) have not received notice of and are not
aware of any actual or potential liability under any Environmental Law,
except where such non-compliance with Environmental Laws, failure to
receive required permits, licenses or other approvals, or liability
would not, individually or in the aggregate, reasonably be expected to
have a Material Adverse Effect.
(z) Except as disclosed in or contemplated by the
Registration Statement and Prospectus, the minimum funding standard
under Section 302 of the Employee Retirement Income Security Act of
1974, as amended, and the regulations and published interpretations
thereunder ("ERISA"), has been satisfied by each "pension plan" (as
defined in Section 3(2) of ERISA) which has been established or
maintained by the Company and/or one or more of its Significant
Subsidiaries, and the trust forming part of each such plan which is
intended to be qualified under Section 401 of the Code is so qualified;
each of the Company and its Significant Subsidiaries has fulfilled its
obligations, if any, under Section 515 of ERISA; neither the Company
nor any of its
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Significant Subsidiaries maintains or is required to contribute to a
"welfare plan" (as defined in Section 3(1) of ERISA) which provides
retiree or other post-employment welfare benefits or insurance coverage
(other than "continuation coverage" (as defined in Section 602 of
ERISA)); each pension plan and welfare plan established or maintained
by the Company and/or one or more of its Significant Subsidiaries is in
compliance in all material respects with the currently applicable
provisions of ERISA; and neither the Company nor any of its Significant
Subsidiaries has incurred or could reasonably be expected to incur any
withdrawal liability under Section 4201 of ERISA, any liability under
Section 4062, 4063, or 4064 of ERISA or any other liability under Title
IV of ERISA.
(aa) There is and has been no material failure on the part
of the Company and any of the Company's directors or officers, in their
capacities as such, to comply with any provision of the Sarbanes Oxley
Act of 2002 and the rules and regulations promulgated in connection
therewith (the "Sarbanes Oxley Act"); including Section 402 related to
loans and Sections 302 and 906 related to certifications.
(bb) Neither the Company nor any of its subsidiaries nor
any director, officer, agent, employee or affiliate of the Company or
any of its subsidiaries is aware of or has taken any action, directly
or indirectly, that would result in a violation by such Persons of the
FCPA (as defined below), including, without limitation, making use of
the mails, or any means or instrumentality of interstate commerce
corruptly in furtherance of an offer, payment, promise to pay or
authorization of the payment of any money, or other property, gift,
promise to give, or authorization of the giving of anything of value to
any "foreign official" (as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for
foreign political office, in contravention of the FCPA and the Company,
its subsidiaries, and their respective affiliates have conducted their
businesses in compliance with the FCPA and have instituted and maintain
policies and procedures designed to ensure, and which are reasonably
expected to continue to ensure, continued compliance therewith. "FCPA"
means Foreign Corrupt Practices Act of 1977, as amended, and the rules
and regulations thereunder.
(cc) The operations of the Company and its subsidiaries
are and have been conducted at all times in compliance with applicable
financial recordkeeping and reporting requirements of the Currency and
Foreign Transactions Reporting Act of 1970, as amended, the money
laundering statutes of all jurisdictions, the rules and regulations
thereunder and any related or similar rules, regulations or guidelines,
issued, administered or enforced by any governmental agency
(collectively, the "Money Laundering Laws") and no action, suit or
proceeding by or before any court or governmental agency, authority or
body or any arbitrator involving the Company or any of its subsidiaries
with respect to the Money Laundering Laws is pending or, to the
Company's knowledge, threatened.
(dd) Neither the Company nor any of its subsidiaries nor
any director, officer, agent, employee or affiliate of the Company or
any of its subsidiaries is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S.
Treasury Department ("OFAC"); and the Company will not directly or
indirectly use the
9
proceeds of the offering, or lend, contribute or otherwise make
available such proceeds to any subsidiary, Joint Venture, joint venture
partner or other person or entity, for the purpose of financing the
activities of any person currently subject to any U.S. sanctions
administered by OFAC.
(ee) The only Significant Subsidiary of the Company is
Interstate Operating Company, L.P. ("IOC").
(ff) Except as disclosed in or contemplated by the
Registration Statement and Prospectus, the Company and its subsidiaries
own, possess, license or have other rights to use, all material
patents, patent applications, trade and service marks, trade and
service xxxx registrations, trade names, copyrights, licenses,
inventions, trade secrets, technology, know-how and other intellectual
property (collectively, the "Intellectual Property") necessary for the
conduct of the Company's business as now conducted or as proposed in
the Prospectus to be conducted, except where the failure to have such
ownership, possession, license or rights would not reasonably be
expected to have a Material Adverse Effect. Except as set forth in the
Prospectus under the captions "Risk Factors - We may be adversely
affected by the limitations in our franchising and licensing
agreements", and "Business - Intellectual Property and Franchises" and
except as would not reasonably be expected to have a Material Adverse
Effect, (a) there are no rights of third parties to any such
Intellectual Property; (b) there is, to the Company's knowledge, no
material infringement by third parties of any such Intellectual
Property; (c) there is no pending or, to the Company's knowledge,
threatened, action, suit, proceeding or claim by others challenging the
Company's or any Significant Subsidiary's rights in or to any such
Intellectual Property, and the Company is unaware of any facts which
would form a reasonable basis for any such claim; (d) there is no
pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others challenging the validity or scope of any
such Intellectual Property, and the Company is unaware of any facts
which would form a reasonable basis for any such claim; and (e) there
is no pending or, to the Company's knowledge, threatened action, suit,
proceeding or claim by others that the Company infringes or otherwise
violates any patent, trademark, copyright, trade secret or other
proprietary rights of others, and the Company is unaware of any other
fact which would form a reasonable basis for any such claim. The
Company has no U.S. patent or published U.S. patent application.
(gg) Except as disclosed in the Registration Statement and
the Prospectus, the Company (i) does not have any material lending or
other relationship with any bank or lending affiliate of any
Underwriter and (ii) does not intend to use any of the proceeds from
the sale of the Securities hereunder to repay any outstanding debt owed
to any affiliate of any Underwriter.
(hh) Neither the Company nor any of its Significant
Subsidiaries nor any of its or their properties or assets has any
immunity from the jurisdiction of any court or from any legal process
(whether through service or notice, attachment prior to judgment,
attachment in aid of execution or otherwise) under the laws of any
state or federal jurisdiction.
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(ii) Except as disclosed in or contemplated by the
Registration Statement and the Prospectus, none of the Company or any
of its Significant Subsidiaries nor any other subsidiary that manages
any hotels, are required, under any agreement in connection with its
investments or Joint Ventures or under any hotel management agreement,
hotel operating agreement, lease or any other similar agreement to
which they are a party (such agreements, collectively, the "Management
Agreements") to (i) repay any base fees, incentive fees or other
amounts or (ii) make any investments or loans, except where the failure
to pay such fees or make such investments or loans would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(jj) Except as disclosed in or contemplated by the
Registration Statement and the Prospectus, neither the Company nor any
of its Significant Subsidiaries nor any other subsidiary that manages
any hotels has received any notice from any owner(s) of properties any
of them manages in which such person has: (i) threatened any action
adverse to the Company or its Significant Subsidiaries; (ii) notified
the Company or any of its Significant Subsidiaries of their failure to
perform under any Management Agreement; or (iii) notified the Company
or any of its Significant Subsidiaries of its intention to terminate or
modify the Management Agreement; nor do there exist any events,
conditions or circumstances which are reasonably likely to result in
any such termination, except where any such action, failure to perform,
termination or modification, would not, individually or in the
aggregate, reasonably be expected to have a Material Adverse Effect.
All Management Agreements are in full force and effect and are
enforceable in accordance with their terms, except as may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to or affecting the enforcement of creditors' rights
generally and general equitable principles and except where the failure
to be enforceable or to be in full force or effect would not,
individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect.
(kk) Except as disclosed in the Registration Statement and
the Prospectus, there is no material restriction on the ability of the
Company or its Significant Subsidiaries to repatriate its earnings from
any of its foreign operations (including Russia).
(ll) The Company and each of its subsidiaries have good
and marketable title in fee simple to all real property and good and
marketable title to all personal property owned by them, free and clear
of all liens, encumbrances and defects, except such as are disclosed in
the Registration Statement or the Prospectus or would reasonably be
expected to have a Material Adverse Effect; and all assets held by the
Company or its subsidiaries under leases are held by them under valid,
subsisting and enforceable leases, except as would reasonably be
expected to have a Material Adverse Effect.
(mm) Except as disclosed in the Registration Statement and
the Prospectus, none of the Company's or any Significant Subsidiary's
fee or leasehold interests in any real property is subject to any
outstanding purchase options, rights of first refusal, rights of first
offer or similar rights, other than such options or rights which would
not reasonably be expected to have a Material Adverse Effect, nor have
the Company or any of its Significant Subsidiaries entered into any
outstanding contracts with others for the sale, mortgage, pledge,
hypothecation, assignment, sublease or lease
11
of or of any material portion of or rights to the real estate
properties owned, directly or indirectly, by the Company or any of its
Significant Subsidiaries except for leases entered in the ordinary
course of business and that which would not reasonably be expected to
have a Material Adverse Effect.
(nn) Except as disclosed in the Registration Statement and
Prospectus and except as would not reasonably be expected to have a
Material Adverse Effect, other than the Intercompany Agreement, dated
as of August 3, 1998, among MeriStar Hospitality Corporation, MeriStar
Hospitality Operating Partnership, L.P., MeriStar Hotels & Resorts,
Inc. and MeriStar H&R Operating Partnership, L.P., the Company's
Senior Credit Facility and franchise agreements between the Company or
any of its Significant Subsidiaries with certain franchisors, neither
the Company nor any Significant Subsidiary is a party to any agreement
that purports to restrict the Company or any Significant Subsidiary or
any of their affiliates, individually or collectively, from engaging,
directly or indirectly, in any business currently engaged in by the
Company or any of its Significant Subsidiaries and none of the
Company's officers, directors or key employees is a party to any
agreement which, by virtue of such person's relationship with the
Company, restricts the Company or any of its Significant Subsidiaries
or any of their affiliates, directly or indirectly, from engaging in a
ny such business.
Any certificate signed by any officer of the Company and
delivered to the Underwriters or counsel for the Underwriters in connection with
the offering of the Securities shall be deemed a representation and warranty by
the Company, as to matters covered thereby, to each of the Underwriters.
(ii) Each of the Selling Stockholders, severally and not
jointly, represents and warrants to, and agrees with, each Underwriter that:
(a) Such Selling Stockholder has all requisite
partnership power and authority to, and has taken all partnership
action necessary, to execute, deliver and perform this Agreement. This
Agreement has been duly authorized, executed and delivered by such
Selling Stockholder.
(b) Such Selling Stockholder is the record and beneficial
owner of the Securities to be sold by it hereunder free and clear of
all liens, encumbrances, equities and claims and has duly endorsed such
Securities in blank, and, assuming that each of the Underwriters
acquires its interest in the Securities it has purchased from such
Selling Stockholder without notice of any adverse claim (within the
meaning of Section 8-105 of the New York Uniform Commercial Code
("UCC")), the Underwriter that has purchased such Securities delivered
pursuant to the Custody Agreement (as defined below) by making payment
therefor as provided herein, and that has had such Securities credited
to the securities account or accounts of such Underwriter maintained
with The Depository Trust Company or such other securities
intermediary, will have acquired a security entitlement (within the
meaning of Section 8-102(a)(17) of the UCC) to such Securities
purchased by such Underwriter, and no action based on an adverse claim
(within the meaning of Section 8-105 of the UCC) may be asserted
against each such Underwriter with respect to such Securities.
12
(c) Such Selling Stockholder has not taken, directly or
indirectly, any action designed to or that would constitute or that
might reasonably be expected to cause or result in, under the Exchange
Act or otherwise, stabilization or manipulation of the price of any
security of the Company to facilitate the sale or resale of the
Securities.
(d) Certificates in negotiable form for such Selling
Stockholder's Securities have been placed in custody, for delivery
pursuant to the terms of this Agreement, under a Custody Agreement and
Power of Attorney duly authorized, executed and delivered by such
Selling Stockholder, in the form heretofore furnished to the Selling
Stockholders (the "Custody Agreement") with Equiserve Trust Company,
N.A., as Custodian (the "Custodian").
(e) No consent, approval, authorization or order of any
court or governmental agency or body is required for the consummation
by such Selling Stockholder of the transactions contemplated herein,
except such as may have been obtained or given and such as may be
required from the New York Stock Exchange, Inc., the National
Association of Dealers, Inc. or as may be required under the blue sky
laws of any jurisdiction and/or the federal and provincial securities
laws of Canada in connection with the purchase and distribution of the
Securities by the Underwriters in the manner contemplated herein and in
the Prospectus.
(f) Neither the sale of the Securities being sold by such
Selling Stockholder nor the consummation of any other of the
transactions herein contemplated by such Selling Stockholder or the
fulfillment of the terms hereof by such Selling Stockholder will
conflict with, result in a breach or violation of, or constitute a
default under any law or the agreement of limited partnership of such
Selling Stockholder or the terms of any indenture or other agreement or
instrument to which such Selling Stockholder is a party or bound, or
any judgment, order or decree applicable to such Selling Stockholder of
any court, regulatory body, administrative agency, governmental body or
arbitrator having jurisdiction over such Selling Stockholder.
(g) The sale of Securities by such Selling Stockholder
pursuant hereto is not prompted by any information concerning the
Company or any of its Significant Subsidiaries which is not set forth
in the Prospectus or any supplement thereto.
(h) Solely in respect of any statements in or omissions
from the Registration Statement or the Prospectus or any supplements
thereto made in reliance upon and in conformity with information
furnished in writing to the Company by such Selling Stockholder
specifically for use in connection with the preparation thereof: (i) on
the
13
Effective Date the Registration Statement did not or will not contain
any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the
statements therein not misleading; and, (ii) on the Effective Date, the
Prospectus, if not filed pursuant to Rule 424(b), will not, and on the
date of any filing pursuant to Rule 424(b) and on the Closing Date and
any settlement date, the Prospectus (together with any supplement
thereto) will not, include any untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were made,
not misleading.
Any certificate signed by any officer of any Selling
Stockholder and delivered to the Underwriters or counsel for the
Underwriters in connection with the offering of the Securities shall be
deemed a joint and several representation and warranty by the Selling
Stockholders, as to matters covered thereby, to each Underwriter.
2. Purchase and Sale. (a) Subject to the terms and
conditions and in reliance upon the representations and warranties herein set
forth, the Company and the Selling Stockholders agree, severally and not
jointly, to sell to each Underwriter, and each Underwriter agrees, severally and
not jointly, to purchase from the Company and the Selling Stockholders, at a
purchase price of $[___] per share, the amount of Underwritten Securities set
forth opposite such Underwriter's name in Schedule I hereto.
(b) Subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth, the Company hereby grants
an option to the several Underwriters to purchase from the Company, severally
and not jointly, up to 1,425,000 Option Securities at the same purchase price
per share as the Underwriters shall pay for the Underwritten Securities. Said
option may be exercised only to cover over-allotments in the sale of the
Underwritten Securities by the Underwriters. Said option may be exercised in
whole or in part at any time on or before the 30th day after the date of the
Prospectus upon written or telegraphic notice by the Underwriters to the Company
setting forth the number of shares of the Option Securities as to which the
several Underwriters are exercising the option and the settlement date. The
maximum number of Option Securities to be sold by the Company is 1,425,000. The
number of Option Securities to be purchased by each Underwriter shall be the
same percentage of the total number of shares of the Option Securities to be
purchased by the several Underwriters as such Underwriter is purchasing of the
Underwritten Securities, subject to such adjustments as the Underwriters in
their absolute discretion shall make to eliminate any fractional shares.
3. Delivery and Payment. Delivery of and payment for the
Underwritten Securities and the Option Securities (if the option provided for in
Section 2(b) hereof shall have been exercised on or before the third Business
Day prior to the Closing Date) shall be made at 10:00 AM, New York City time, on
[________], 2003, or at such time on such later date not more than three
Business Days after the foregoing date as Citigroup Global Markets Inc. shall
designate, which date and time may be postponed by agreement among the
Underwriters, the Company and the Selling Stockholders (such date and time of
delivery and payment for the Securities being herein called the "Closing Date").
Delivery of the Securities shall be made to the Underwriters for their
respective accounts against payment by the Underwriters of the respective
aggregate purchase prices of the Securities being sold by the Company and each
of the
14
Selling Stockholders to or upon the order of the Company and the Selling
Stockholders by wire transfer payable in same-day funds to the accounts
specified by the Company and the Selling Stockholders. Unless the Underwriters
shall otherwise instruct: (a) delivery of the Underwritten Securities and the
Option Securities (other than the Securities being sold by the Selling
Stockholders) shall be made through the facilities of the Depository Trust
Company; and (b) delivery of the Securities being sold by the Selling
Stockholders shall be made pursuant to the terms of the Custody Agreement.
Certificates for any such Securities shall be registered in such names and in
such denominations as Citigroup Global Markets Inc. may request not less than
two Business Days in advance of the Closing Date.
The Company will pay all applicable state transfer taxes, if
any, involved in the transfer to the Underwriters of the Securities to be
purchased by it from each Selling Stockholder and the Underwriters will pay any
additional stock transfer taxes involved in further transfers.
If the option provided for in Section 2(b) hereof is exercised
after the third Business Day prior to the Closing Date, the Company will deliver
the Option Securities (at the expense of the Company) to Citigroup Global
Markets Inc., at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, xx the date specified
by Citigroup Global Markets Inc. (which shall be within three Business Days
after exercise of said option) for the respective accounts of the several
Underwriters against payment by the Underwriters of the purchase price thereof
to or upon the order of the Company by wire transfer payable in same-day funds
to the accounts specified by the Company. If settlement for the Option
Securities occurs after the Closing Date, the Company will deliver to the
Underwriters on the settlement date for the Option Securities, and the
obligation of the Underwriters to purchase the Option Securities shall be
conditioned upon receipt of, supplemental opinions, certificates and letters
confirming as of such date the opinions, certificates and letters delivered on
the Closing Date pursuant to Section 6 hereof.
4. Offering by Underwriters. It is understood that the
several Underwriters propose to offer the Securities for sale to the public as
set forth in the Prospectus.
5. Agreements.
(i) The Company agrees with each of the
Underwriters that:
(a) The Company will use its best efforts to
cause the Registration Statement, if not effective at the
Execution Time, and any amendment thereof, to become
effective. Prior to the termination of the offering of the
Securities, the Company will not file any amendment of the
Registration Statement or supplement to the Prospectus or any
Rule 462(b) Registration Statement unless the Company has
furnished the Underwriters a copy for its review prior to
filing and will not file any such proposed amendment or
supplement to which the Underwriters reasonably object.
Subject to the foregoing sentence, if the Registration
Statement has become or becomes effective pursuant to Rule
430A, or filing of the Prospectus is otherwise required under
Rule 424(b), the Company will cause the Prospectus, properly
completed, and any supplement thereto to be filed in a form
approved by the Underwriters (such approval not to be
unreasonably withheld) with the Commission pursuant to the
applicable
15
paragraph of Rule 424(b) within the time period prescribed and
will provide evidence satisfactory to the Underwriters of such
timely filing. The Company will promptly advise the
Underwriters (1) when the Registration Statement, if not
effective at the Execution Time, shall have become effective,
(2) when the Prospectus, and any supplement thereto, shall
have been filed (if required) with the Commission pursuant to
Rule 424(b) or when any Rule 462(b) Registration Statement
shall have been filed with the Commission, (3) when, prior to
termination of the offering of the Securities, any amendment
to the Registration Statement shall have been filed or become
effective, (4) of any request by the Commission or its staff
for any amendment of the Registration Statement, or any Rule
462(b) Registration Statement, or for any supplement to the
Prospectus or for any additional information, (5) of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution
or threatening of any proceeding for that purpose and (6) of
the receipt by the Company of any notification with respect to
the suspension of the qualification of the Securities for sale
in any jurisdiction or the institution or threatening of any
proceeding for such purpose. The Company will use its best
efforts to prevent the issuance of any such stop order or the
suspension of any such qualification and, if issued, to obtain
as soon as possible the withdrawal thereof.
(b) If, at any time when a prospectus relating
to the Securities is required to be delivered by the
Underwriters under the Act, any event occurs as a result of
which the Prospectus as then supplemented would include any
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the
light of the circumstances under which they were made not
misleading, or if it shall be necessary to amend the
Registration Statement or supplement the Prospectus to comply
with the Act or the Exchange Act or the respective rules
thereunder, the Company promptly will (1) notify the
Underwriters of such event, (2) prepare and file with the
Commission, subject to the second sentence of paragraph (i)(a)
of this Section 5, an amendment or supplement which will
correct such statement or omission or effect such compliance
and (3) supply any supplemented Prospectus to the Underwriters
in such quantities as they may reasonably request.
(c) As soon as practicable, the Company will
make generally available to its security holders and to the
Underwriters an earnings statement or statements of the
Company and its consolidated subsidiaries which will satisfy
the provisions of Section 11(a) of the Act and Rule 158 under
the Act.
(d) The Company will furnish to each Underwriter
and counsel for each Underwriter, without charge, signed
copies of the Registration Statement (including exhibits
thereto) and, so long as delivery of a prospectus by an
Underwriter or dealer may be required by the Act, as many
copies of each Preliminary Prospectus and the Prospectus and
any supplement thereto as each Underwriter may reasonably
request. The Company will pay the expenses of printing or
other production of all documents relating to the offering.
16
(e) The Company will arrange, if necessary, for
the qualification of the Securities for sale under the laws of
such jurisdictions as the Underwriters may reasonably
designate, will maintain such qualifications in effect so long
as required for the distribution of the Securities and will
pay any fee of the National Association of Securities Dealers,
Inc., in connection with its review of the offering; provided
that in no event shall the Company be obligated to qualify to
do business in any jurisdiction where it is not now so
qualified or to take any action that would subject it to
service of process in suits, other than those arising out of
the offering or sale of the Securities, in any jurisdiction
where it is not now so subject.
(f) The Company will not, without the prior
written consent of Citigroup Global Markets Inc., offer, sell,
contract to sell, pledge, or otherwise dispose of (or enter
into any transaction which is designed to, or might reasonably
be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash
settlement or otherwise) by the Company or any affiliate of
the Company or any person in privity with the Company or any
affiliate of the Company), directly or indirectly, including
the filing (or participation in the filing) of a registration
statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a
call equivalent position within the meaning of Section 16 of
the Exchange Act, any other shares of Common Stock or any
securities convertible into, or exercisable, or exchangeable
for, shares of Common Stock; or publicly announce an intention
to effect any such transaction, for a period of 90 days after
the date of this Agreement, provided, however, that the
Company may issue and sell Common Stock pursuant to any
employee stock option plan, stock ownership plan or dividend
reinvestment plan of the Company in effect at the Execution
Time, the Company may issue Common Stock issuable upon the
conversion or redemption of securities, including the
redemption of partnership units of IOC, or the exercise of
warrants outstanding at the Execution Time and the Company may
issue and sell the Securities as provided in this Agreement.
(g) The Company will comply with all applicable
securities and other applicable laws, rules and regulations,
including, without limitation, the Sarbanes Oxley Act, and to
use its commercially reasonable efforts to cause the Company's
directors and officers, in their capacities as such, to comply
with such laws, rules and regulations, including, without
limitation, the provisions of the Sarbanes Oxley Act.
(h) The Company will not take, directly or
indirectly, any action designed to or that would constitute or
that might reasonably be expected to cause or result in, under
the Exchange Act or otherwise, stabilization or manipulation
of the price of any security of the Company to facilitate the
sale or resale of the Securities.
(ii) Each of the Selling Stockholders, severally
and not jointly, agrees with each of the Underwriters that:
17
(a) Such Selling Stockholder will not, without
the prior written consent of Citigroup Global Markets Inc.,
offer, sell, contract to sell, pledge or otherwise dispose of
(or enter into any transaction which is designed to, or might
reasonably be expected to, result in the disposition (whether
by actual disposition or effective economic disposition due to
cash settlement or otherwise) by such Selling Stockholder or
any affiliate of such Selling Stockholder or any person in
privity with such Selling Stockholder or any affiliate of such
Selling Stockholder), directly or indirectly, including the
filing (or participation in the filing) of a registration
statement with the Commission in respect of, or establish or
increase a put equivalent position or liquidate or decrease a
call equivalent position within the meaning of Section 16 of
the Exchange Act with respect to, any shares of capital stock
of the Company or any securities convertible into, or
exercisable or exchangeable for such capital stock, or
publicly announce an intention to effect any such transaction,
for a period of 90 days after the date of this Agreement,
other than (a) shares of Common Stock disposed of as bona fide
gifts approved by Citigroup Global Markets, Inc., (b) the
disposition of all of such Selling Stockholders' shares of
Common Stock in a single private sale, exempt from
registration under the Act to an entity wholly owned by any
one or more of Xxxxx X. Xxxxxxx, Xxxxxxx X. Xxxxxx and
Xxxxxxxx X. Xxxxxx, which entity also assumes the terms of
this Agreement pursuant to the joinder attached hereto as
Exhibit C, (c) the distribution in kind of shares of Common
Stock by such Selling Stockholder to its partners, each of
which distributee partner also assumes the terms of this
Agreement pursuant to the joinder attached hereto as Exhibit
C, (d) the trading of Common Stock, or any derivative thereof,
in the ordinary course of business by affiliates of Xxxxxx
Brothers Inc. other than the Selling Stockholders and (e)
Securities sold pursuant to this Agreement.
(b) Each Selling Stockholder will not take,
directly or indirectly, any action designed to or that would
constitute or that might reasonably be expected to cause or
result in, under the Exchange Act or otherwise, stabilization
or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Securities.
(c) Each Selling Stockholder will advise the
Underwriters promptly, and if requested by the Underwriters,
will confirm such advice in writing, so long as delivery of a
prospectus relating to the Securities by an Underwriter or
dealer may be required under the Act, of any change in
information in the Registration Statement or the Prospectus
relating to such Selling Stockholder.
6. Conditions to the Obligations of the Underwriters.
The obligations of the Underwriters to purchase the Underwritten Securities and
the Option Securities, as the case may be, shall be subject to the accuracy in
all material respects of the representations and warranties on the part of the
Company and the Selling Stockholders contained herein that are not qualified by
materiality and the accuracy in all respects of the representations and
warranties on the part of the Company and the Selling Stockholders contained
herein that are qualified by materiality, in each case as of the Execution Time,
the Effective Date, the Closing Date and any settlement date pursuant to Section
3 hereof, to the accuracy of the statements of the Company and the Selling
18
Stockholders made in any certificates pursuant to the provisions hereof, to the
performance by the Company and the Selling Stockholders of their respective
obligations hereunder and to the following additional conditions:
(a) If the Registration Statement has not become
effective prior to the Execution Time, unless Citigroup Global Markets
Inc. agrees in writing to a later time, the Registration Statement will
become effective not later than (i) 6:00 PM New York City time on the
date of determination of the public offering price, if such
determination occurred at or prior to 3:00 PM New York City time on
such date or (ii) 9:30 AM on the Business Day following the day on
which the public offering price was determined, if such determination
occurred after 3:00 PM New York City time on such date; if filing of
the Prospectus, or any supplement thereto, is required pursuant to Rule
424(b), the Prospectus, and any such supplement, will be filed in the
manner and within the time period required by Rule 424(b); and no stop
order suspending the effectiveness of the Registration Statement shall
have been issued and no proceedings for that purpose shall have been
instituted or threatened.
(b) The Company shall have requested and caused Xxxx,
Weiss, Rifkind, Xxxxxxx & Xxxxxxxx LLP, counsel for the Company, to
have furnished to the Underwriters their opinion, dated the Closing
Date and addressed to the Underwriters, to the effect that:
(i) The Company is a corporation duly
incorporated, validly existing and in good standing under the
laws of the State of Delaware. The Company has all necessary
corporate power and authority to execute, deliver and perform
its obligations under this Agreement and to own and hold its
properties and conduct its business as described in the
Registration Statement; solely in reliance on certificates of
public officials in the respective jurisdictions, the Company
is duly qualified to do business as a foreign corporation or
limited partnership and is in good standing under the laws of
each of the jurisdictions listed on a schedule to such
opinion;
(ii) Each of IOC and BridgeStreet is duly
organized, validly existing and in good standing under the
laws of the State of Delaware and each has all necessary
partnership or corporate, as the case may be, power and
authority to own and hold its properties and conduct its
business as described in the Registration Statement; solely in
reliance on certificates of public officials in the respective
jurisdictions, IOC is duly qualified to do business as a
foreign corporation or limited partnership and is in good
standing under the laws of each of the jurisdictions listed on
a schedule to such opinion and BridgeStreet is duly qualified
to do business as a foreign corporation or limited partnership
and is in good standing under the laws of each of the
jurisdictions listed on a schedule to such opinion;
(iii) The Company's authorized equity
capitalization is as set forth in the Prospectus;
(iv) The Securities have been duly authorized by
all necessary corporate action on the part of the Company and
(other than with respect to the
19
Securities sold by the Selling Stockholders), when issued and
delivered to and paid for by the Underwriters in accordance
with the terms of this Agreement, will be validly issued,
fully paid and non-assessable.
(v) Except as described in the Prospectus and
except for such rights of the Selling Stockholders, there are
no preemptive or other similar rights to subscribe for or to
purchase shares of Common Stock in the Company's certificate
of incorporation or by-laws, each as in effect on the date of
this letter, or in any agreement or other outstanding
instrument known to such counsel to which the Company is a
party, or under the General Corporation Law of the State of
Delaware.
(vi) the Securities being sold by the Selling
Stockholders are duly listed, and admitted and authorized for
trading, on the New York Stock Exchange and the Securities
being sold hereunder by the Company are duly listed, and
admitted and authorized for trading, subject to official
notice of issuance, on the New York Stock Exchange
(vii) To the knowledge of such counsel, except as
disclosed in the Registration Statement and the Prospectus, no
action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator
involving the Company or any of its Significant Subsidiaries
or its or their property is pending or threatened that (i)
would reasonably be expected to have a material adverse effect
on the performance of this Agreement or the consummation of
any of the transactions contemplated hereby; or (ii) would
reasonably be expected to have a Material Adverse Effect.
(viii) The statements included in the Prospectus
under the headings "Business - Relationship with MeriStar
Hospitality", "Business - The Operating Partnership",
"Management - Our Board Composition Agreement", "Business -
Intellectual Property and Franchises," "Business -
Governmental Regulations," and "Certain Relationships and
Related Transactions", to the extent that they constitute
summaries of United States Federal statutes, rules and
regulations or portions thereof, are accurate in all material
respects;
(ix) The statements in the Prospectus under the
heading "United States Federal Income Tax Consequences," to
the extent they constitute summaries of United States federal
law or regulation or legal conclusions, have been reviewed by
such counsel and fairly summarize the matters described under
that heading in all material respects;
(x) The Common Stock of the Company conforms in
all material respects to the description thereof contained in
the Prospectus under the caption "Description of Capital
Stock." The form of certificate used to evidence the
Securities is in due and proper form and complies in all
material respects with all applicable requirements of the
charter and by-laws of the Company and the General Corporation
Law of the State of Delaware;
20
(xi) The Registration Statement and the
Prospectus, as of their respective effective or issue times,
appear on their face to be appropriately responsive in all
material respects to the requirements of the Act and the rules
and regulations of the Commission under the Act, except for
the financial statements, financial statement schedules and
other financial data included or incorporated by reference in
or omitted from either of them, as which such counsel
expresses no opinion; and each document filed under the
Exchange Act, and incorporated by reference in the
Registration Statement and Prospectus (except for financial
statements, financial statement schedules and other financial
data included in either of them, as to which such counsel
expresses no opinion) appears on its face to be appropriately
responsive in all material respects when so filed to the
requirements of the Exchange Act and the rules and regulations
of the Exchange Act;
(xii) this Agreement has been duly authorized,
executed and delivered by the Company;
(xiii) Neither the Company nor any of its
subsidiaries is, and, after giving effect to the offering and
sale of the Securities and the application of the proceeds
thereof as described in the Prospectus under the heading "Use
of Proceeds" none of them will be required to be registered as
an "investment company" under the Investment Company Act of
1940, as amended, and the rules and regulations of the
Commission promulgated thereunder;
(xiv) No consent, approval, authorization or order
of, or filing, registration or qualification with, any
Governmental Authority, which has not been obtained, taken or
made (other than as required by any state or foreign
securities laws, as to which such counsel expresses no
opinion) is required under any applicable law for the issuance
or sale of the Securities or the performance by the Company of
its obligations under this Agreement. For purposes of this
opinion, the term "Governmental Authority" means any
executive, legislative, judicial administrative or regulatory
body of the State of New York or the United States of America;
(xv) The issuance and sale of the Securities by
the Company, the compliance by the Company with all the
provisions of this Agreement and the performance by the
Company of its obligations thereunder, assuming, for purposes
of clauses (ii), (iii) and (iv) the compliance by the
Underwriters with the requirements of Section 5 of the Act
relating to delivery of the Prospectus, will not (i) result in
a violation of the charter documents of the Company or any
Significant Subsidiary; (ii) breach or result in a default
under any agreement, indenture or instrument listed as an
Exhibit to the Registration Statement or otherwise referred to
in the Registration Statement to which the Company or any of
its subsidiaries is a party or is bound or to which any of the
properties or assets of the Company or any subsidiary is
subject; (iii) violate any Applicable Law or (iv) violate any
judgment, or decree of any court or arbitrator known to us,
except where, in the event of any breach under (ii), (iii) or
(iv) above, such breach or violation would not reasonably be
expected to have, individually or in the aggregate, a
Material Adverse Effect. For purposes of this opinion (xv),
the term "Applicable Law" means the General
21
Corporation Law of the State of Delaware and those laws, rules
and regulations of the United States of America and the State
of New York, in each case which in our experience are normally
applicable to the transactions of the type contemplated by
this Agreement and excludes all state securities laws, the
anti-fraud requirements under the Act and the Exchange Act;
and
(xvi) Except as disclosed in the Prospectus, to
such counsel's knowledge, there are no persons with
registration or other similar rights to have any equity or
debt securities registered for sale under the Registration
Statement, or included in the offering contemplated by this
Agreement, other than the Selling Shareholders, except for
such rights as have been duly waived.
Such opinion would also include statements to the effect that
such counsel had been advised (a) by the New York Stock
Exchange, Inc. that the Underwritten Securities are duly
authorized for listing, subject to official notice of
issuance; and (b) by the staff of the Commission that the
Registration Statement and all post-effective amendments, if
any, have become effective under the Act as of the relevant
date and that, to the best of such counsel's knowledge, no
stop order suspending the effectiveness of the Registration
Statement had been issues and no proceedings for that purpose
are pending before or contemplated by the Commission.
The opinion discussed above will also state that such counsel
has participated in the preparation of the Registration
Statement and the Prospectus and, although the limitations
inherent in the independent verification of factual matters
and in the role of outside counsel are such that such counsel
has not undertaken to investigate or verify independently, and
does not assume responsibility for, the accuracy, completeness
or fairness of the statements contained in either of them
(other than as explicitly stated in paragraphs (v), (viii),
(ix), (x) and (xiii)), based upon such participation, no facts
have come to such counsel's attention that led them to believe
that (a) the Registration Statement or any amendment (except
for the financial statements, financial statement schedules
and other financial data included or incorporated by reference
in or omitted from those documents, as to which such counsel
expresses no such belief), at the time such Registration
Statement became effective or the date the Registration
Statement was last deemed amended, contained an untrue
statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the
statements therein not misleading or (b) the Prospectus or any
amendment or supplement (except for the financial statements,
financial statement schedules and other financial data
included in or omitted from those documents, as to which such
counsel expresses no such belief), as of the time of issuance
of the Prospectus and on the date of rendering the opinion,
included or includes an untrue statement of a material fact or
omitted or omits to state a material fact necessary in order
to make the statements therein, in the light of the
circumstances under which they were made, not misleading.
22
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the
State of Delaware, the State of New York or the Federal laws of the
United States, to the extent they deem proper and specified in such
opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the
Underwriters and (B) as to matters of fact, to the extent they deem
proper, on certificates of responsible officers of the Company and
public officials. References to the Prospectus in this paragraph (b)
shall also include any supplements thereto at the Closing Date.
(c) The Company's General Counsel will also furnish to
the Underwriters an opinion (which shall not be qualified by any
knowledge or other qualifiers), dated the Closing Date and addressed to
the Underwriters, to the effect that:
(i) Except as set forth in the Prospectus, no
options, warrants or other rights to purchase from the
Company, agreements or other obligations of the Company to
issue, or rights to convert any obligations into or exchange
any securities for, shares of capital stock of or ownership
interests in the Company are outstanding;
(ii) All of the outstanding partnership interests
of IOC and the shares of BridgeStreet have been duly and
validly authorized and issued and (except for equity interests
of IOC owned by third parties) are owned directly or
indirectly by the Company, free and clear of all liens,
encumbrances, equities or claims other than security interests
granted under the Company's Senior Credit Facility; and
(iii) All of the issued and outstanding shares of
the Common Stock of the Company (including the Securities
being sold hereunder by the Selling Stockholders) are validly
issued and outstanding, fully paid and non-assessable.
(d) The Selling Stockholders shall have requested and
caused Fried, Frank, Harris, Xxxxxxx & Xxxxxxxx, a partnership
including professional corporations, counsel for the Selling
Stockholders, to have furnished to the Underwriters their opinion dated
the Closing Date and addressed to the Underwriters, to the effect that:
(i) this Agreement has been duly authorized,
executed and delivered by the Selling Stockholders;
(ii) assuming that each Underwriter acquires its
interest in the Securities it has purchased from such Selling
Stockholder without notice of any adverse claim (within the
meaning of Section 8-105 of the UCC), the Underwriter that has
purchased such Securities delivered on the Closing Date to The
Depository Trust Company or other securities intermediary by
making payment therefor as provided herein, and that has had
such Securities credited to the securities account or accounts
of such Underwriter maintained with The Depository Trust
Company or such other securities intermediary will have
acquired a security entitlement (within the meaning of Section
8-102(a)(17) of the UCC) to such Securities purchased by such
Underwriter, and no action based on
23
an adverse claim (within the meaning of Section 8-105 of the
UCC) may be asserted against such Underwriter with respect to
such Securities;
(iii) no consent, approval, authorization or order
of any court or governmental agency or body is required for
the consummation by any Selling Stockholder of the
transactions contemplated herein, except such as may have been
obtained under the Act and such as may be required under the
blue sky laws of any jurisdiction in connection with the
purchase and distribution of the Securities by the
Underwriters and such other approvals (specified in such
opinion) as have been obtained; and
(iv) neither the sale of the Securities being
sold by any Selling Stockholder nor the consummation of any
other of the transactions herein contemplated by any Selling
Stockholder or the fulfillment of the terms hereof by any
Selling Stockholder will conflict with, result in a breach or
violation of, or constitute a default under any law or the
agreement of limited partnership of the Selling Stockholders
or the terms of any indenture or other agreement or instrument
known to such counsel and to which any Selling Stockholder is
a party or bound, or any judgment, order or decree known to
such counsel to be applicable to any Selling Stockholder of
any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over any
Selling Stockholder.
In rendering such opinion, such counsel may rely (A) as to matters
involving the application of laws of any jurisdiction other than the
State of Delaware, the State of New York or the Federal laws of the
United States, to the extent they deem proper and specified in such
opinion, upon the opinion of other counsel of good standing whom they
believe to be reliable and who are satisfactory to counsel for the
Underwriters and (B) as to matters of fact, to the extent they deem
proper, on certificates of responsible officers of the Selling
Stockholders and public officials.
(e) The Underwriters shall have received from Proskauer
Rose LLP, counsel for the Underwriters, such opinion or opinions, dated
the Closing Date and addressed to the Underwriters, with respect to the
issuance and sale of the Securities, the Registration Statement, the
Prospectus (together with any supplement thereto) and other related
matters as the Underwriters may reasonably require, and the Company and
each Selling Stockholder shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon
such matters.
(f) The Company shall have furnished to the Underwriters
a certificate of the Company, signed by the Chairman of the Board or
the Chief Executive Officer and the principal financial or accounting
officer of the Company, dated the Closing Date, to the effect that the
signers of such certificate have carefully examined the Registration
Statement, the Prospectus, any supplements to the Prospectus and this
Agreement and that:
24
(i) the representations and warranties of the
Company in this Agreement that are not qualified by
materiality are true and correct in all material respects and
the representations and warranties of the Company in this
Agreement that are qualified by materiality are true and
correct in all respects, in each case on and as of the Closing
Date with the same effect as if made on the Closing Date, and
the Company has complied with all the agreements and satisfied
all the conditions on its part to be performed or satisfied at
or prior to the Closing Date;
(ii) no stop order suspending the effectiveness
of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or, to the
Company's knowledge, threatened; and
(iii) since the date of the most recent financial
statements included or incorporated by reference in the
Prospectus (exclusive of any supplement thereto), there has
been no Material Adverse Effect, except as set forth in or
contemplated in the Prospectus (exclusive of any supplement
thereto).
(g) Each Selling Stockholder shall have furnished to the
Underwriters a certificate, signed by an officer of the general partner
of such Selling Stockholder, dated the Closing Date, to the effect that
the representations and warranties of such Selling Stockholder in this
Agreement are true and correct in all material respects on and as of
the Closing Date to the same effect as if made on the Closing Date.
(h) The Company shall have requested and caused KPMG LLP
and PriceWaterhouseCoopers LLP to have furnished to the Underwriters,
at the Execution Time and at the Closing Date, letters, dated
respectively as of the Execution Time and as of the Closing Date, in
form and substance satisfactory to the Underwriters, confirming that
they are independent accountants within the meaning of the Act and the
Exchange Act and the respective applicable rules and regulations
adopted by the Commission thereunder and that KPMG LLP has performed a
review of the unaudited interim financial information of the Company
for the nine-month period ended September 30, 2003 and as at September
30, 2003, in accordance with Statement on Auditing Standards No. 100,
and stating in effect that:
(i) in their opinion the audited financial
statements and financial statement schedules included or
incorporated by reference in the Registration Statement and
the Prospectus and reported on by them comply as to form in
all material respects with the applicable accounting
requirements of the Act and the Exchange Act and the related
rules and regulations adopted by the Commission;
(ii) on the basis of a reading of the latest
unaudited financial statements made available by the Company
and its Significant Subsidiaries; their limited review, in
accordance with standards established under Statement on
Auditing Standards No. 100, of the unaudited interim financial
information for the nine-month period ended September 30,
2003, and as at September 30, 2003; carrying out certain
specified procedures (but not an examination in accordance
25
with generally accepted auditing standards) which would not
necessarily reveal matters of significance with respect to the
comments set forth in such letter; a reading of the minutes of
the meetings of the stockholders and directors of the Company
and committees of its board of directors; and inquiries of
certain officials of the Company who have responsibility for
financial and accounting matters of the Company and its
Significant Subsidiaries as to transactions and events
subsequent to September 30, 2003, nothing came to their
attention which caused KPMG LLP to believe that:
(1) any unaudited financial statements
included or incorporated by reference in the
Registration Statement and the Prospectus do not
comply as to form in all material respects with
applicable accounting requirements of the Act and
with the related rules and regulations adopted by the
Commission with respect to financial statements
included or incorporated by reference in quarterly
reports on Form 10-Q under the Exchange Act; and said
unaudited financial statements are not in conformity
with generally accepted accounting principles applied
on a basis substantially consistent with that of the
audited financial statements included or incorporated
by reference in the Registration Statement and the
Prospectus;
(2) to the extent applicable, with
respect to the period subsequent to September 30,
2003, there were any changes, at a specified date not
more than five days prior to the date of the letter,
in the long-term debt of the Company and its
subsidiaries or capital stock of the Company or
decreases in the stockholders' equity of the Company
or decreases in working capital of the Company and
its Significant Subsidiaries as compared with the
amounts shown on the September 30, 2003, consolidated
balance sheet included or incorporated by reference
in the Registration Statement and the Prospectus, or
for the period from October 1, 2003 to said specified
date there were any decreases, as compared with the
corresponding period in the preceding year in total
revenues, net operating income, income before
minority interests and income taxes or in total or
per share amounts of net income of the Company and
its Significant Subsidiaries, except in all instances
for changes or decreases set forth in such letter, in
which case the letter shall be accompanied by an
explanation by the Company as to the significance
thereof unless said explanation is not deemed
necessary by the Underwriters;
(3) the information included or
incorporated by reference in the Registration
Statement and Prospectus in response to Regulation
S-K, Item 301 (Selected Financial Data), Item 302
(Supplementary Financial Information), Item 402
(Executive Compensation) is not in conformity with
the applicable disclosure requirements of Regulation
S-K; or
(iii) they have performed certain other specified
procedures as a result of which they determined that certain
information of an accounting, financial or
26
statistical nature (which is limited to accounting, financial
or statistical information derived from the general accounting
records of the Company and its Significant Subsidiaries) set
forth in the Registration Statement and the Prospectus and in
Exhibit 12 to the Registration Statement, including the
information set forth under the captions "Unaudited Pro Forma
Combined Financial Information" and "Selected Historical
Condensed Consolidated Financial Information" in the
Prospectus, the information included or incorporated by
reference in Items 1, 2, 6, 7 and 11 of the Company's Annual
Report on Form 10-K, incorporated by reference in the
Registration Statement and the Prospectus, and with respect to
KPMG LLP the information included in the "Management's
Discussion and Analysis of Financial Condition and Results of
Operations" included or incorporated by reference in the
Company's 10-Q, incorporated by reference in the Registration
Statement and the Prospectus, agrees with the accounting
records of the Company and its Significant Subsidiaries,
excluding any questions of legal interpretation.
(iv) On the basis of a reading of the unaudited
pro forma financial statements included or incorporated by
reference in the Registration Statement and the Prospectus
(the "pro forma financial statement"); carrying out certain
specified procedures; inquiries of certain officials of the
Company who have responsibility for financial and accounting
matters; and proving the arithmetic accuracy of the
application of the pro forma adjustments to the historical
amounts in the pro forma financial statements, nothing came
to KPMG LLP's attention which caused them to believe that the
pro forma financial statements do not comply as to form in
all material aspects with the applicable accounting
requirements of Rule 11-02 of Regulations S-X or that the pro
forma adjustments have not been properly applied to the
historical amounts in the compilation of such statements.
References to the Prospectus in this paragraph (h) include any
supplement thereto at the date of the letter.
(i) Subsequent to the Execution Time or, if earlier, the
dates as of which information is given in the Registration Statement
(exclusive of any amendment thereof) and the Prospectus (exclusive of
any supplement thereto), there shall not have been (i) any change or
decrease specified in the letter or letters referred to in paragraph
(g) of this Section 6 or (ii) any change, or any development that would
reasonably be expected to have a Material Adverse Effect, except as set
forth in or contemplated in the Prospectus (exclusive of any supplement
thereto) the effect of which, in any case referred to in clause (i) or
(ii) above, is, in the sole judgment of the Underwriters, so material
and adverse as to make it impractical or inadvisable to proceed with
the offering or delivery of the Securities as contemplated by the
Registration Statement (exclusive of any amendment thereof) and the
Prospectus (exclusive of any supplement thereto).
(j) Prior to the Closing Date, the Company and the
Selling Stockholders shall have furnished to the Underwriters such
further information, certificates and documents as the Underwriters may
reasonably request.
(k) The Securities shall have been listed and admitted
and authorized for trading on the New York Stock Exchange, and
satisfactory evidence of such actions shall have been provided to the
Underwriters.
(l) At or before the Execution Time, the Company shall
have furnished to the Underwriters a letter substantially in the form
of Exhibit A hereto from each officer or director of the Company and a
letter substantially in the form of Exhibit B hereto from Oak Hill
Capital Partners, L.P., and Oak Hill Capital Management Partners, L.P.,
in each case addressed to the Underwriters.
If any of the conditions specified in this Section 6 shall not
have been fulfilled when and as provided in this Agreement, or if any of the
opinions and certificates mentioned
27
above or elsewhere in this Agreement shall not be reasonably satisfactory in
form and substance to an Underwriter and counsel for such Underwriter, this
Agreement and all obligations of an Underwriter hereunder may be canceled at, or
at any time prior to, the Closing Date by any of the Underwriters with respect
to itself. Notice of such cancellation shall be given to the Company and each
Selling Stockholder in writing or by telephone or facsimile confirmed in
writing.
The documents required to be delivered by this Section 6 shall
be delivered at the office of Proskauer Rose LLP, counsel for the Underwriters,
at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx 00000, on the Closing Date.
7. Reimbursement of Underwriters' Expenses. If the sale
of the Securities provided for herein is not consummated because any condition
to the obligations of the Underwriters set forth in Section 6 hereof is not
satisfied, because of any termination pursuant to Section 10 hereof or because
of any refusal, inability or failure on the part of the Company or any Selling
Stockholders to perform any agreement herein or comply with any provision hereof
other than by reason of a default by any of the Underwriters, the Company will
reimburse the Underwriters severally through Citigroup Global Markets, Inc., on
demand for all reasonable out-of-pocket expenses (including reasonable fees and
disbursements of counsel) that shall have been incurred by them in connection
with the proposed purchase and sale of the Securities.
8. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each
Underwriter, the directors, officers, employees and agents of each
Underwriter and each person who controls any Underwriter within the
meaning of either the Act or the Exchange Act against any and all
losses, claims, damages or liabilities, joint or several, to which they
or any of them may become subject under the Act, the Exchange Act or
other Federal or state statutory law or regulation, at common law or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact contained in
the registration statement for the registration of the Securities as
originally filed or in any amendment thereof, or in any Preliminary
Prospectus or the Prospectus, or in any amendment thereof 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, and agrees
to reimburse each such indemnified party, as incurred, for any legal or
other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or
action; provided, however, that the Company will not be liable in any
such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon any such untrue statement or alleged
untrue statement or omission or alleged omission made therein in
reliance upon and in conformity with written information furnished to
the Company by or on behalf of an Underwriter specifically for
inclusion therein; provided, further, that with respect to any untrue
statement or omission of material fact made in any Prospectus, the
indemnity agreement contained in this Section 8(a) shall not inure to
the benefit of any Underwriter from whom the person asserting any such
loss, claim, damage or liability purchased the securities concerned, to
the extent, but only to the extent, that any such loss, claim, damage
or liability of such Underwriter
28
occurs under the circumstance where the Company sustains the burden of
proving to a court of competent jurisdiction that (w) the Company had
previously timely furnished copies of an amended or supplemented
Prospectus to such Underwriter, (x) delivery of the amended or
supplemented Prospectus was required by the Act to be made to such
person, (y) the untrue statement or omission of a material fact
contained in a Prospectus was corrected in the amended or supplemented
Prospectus and (z) there was not sent or given to such person, at or
prior to the written confirmation of the sale of such securities to
such person, a copy of the amended or supplemented Prospectus. This
indemnity agreement will be in addition to any liability which the
Company may otherwise have.
(b) Each of the Selling Stockholders, severally and not
jointly, agrees to indemnify and hold harmless the Company, each of its
directors, each of its officers who signs the Registration Statement,
each Underwriter, the directors, officers, employees and agents of each
Underwriter and each person who controls the Company or any Underwriter
within the meaning of either the Act or the Exchange Act and each other
Selling Stockholder, if any, to the same extent as the foregoing
indemnity from the Company to each Underwriter, but only with reference
to written information furnished to the Company by or on behalf of the
Selling Stockholders specifically for inclusion in the documents
referred to in the foregoing indemnity, provided, however, that with
respect to any untrue statement or omission of material fact made in
any Prospectus, the indemnity agreement contained in this Section 8(b)
shall not inure to the benefit of any Underwriter from whom the person
asserting any such loss, claim, damage or liability purchased the
securities concerned, to the extent, but only to the extent, that any
such loss, claim, damage or liability of such Underwriter occurs under
the circumstance where the Company sustains the burden of proving to a
court of competent jurisdiction that (w) the Company had previously
timely furnished copies of an amended or supplemented Prospectus to
such Underwriter, (x) delivery of the amended or supplemented
Prospectus was required by the Act to be made to such person, (y) the
untrue statement or omission of a material fact contained in a
Prospectus was corrected in the amended or supplemented Prospectus and
(z) there was not sent or given to such person, at or prior to the
written confirmation of the sale of such securities to such person, a
copy of the amended or supplemented Prospectus. This indemnity
agreement will be in addition to any liability which the Selling
Stockholders may otherwise have.
(c) Each Underwriter, severally and not jointly, agrees
to indemnify and hold harmless the Company, each of its directors, each
of its officers who signs the Registration Statement, and each person
who controls the Company within the meaning of either the Act or the
Exchange Act and each Selling Stockholder and each person who controls
a Selling Stockholder within the meaning of either the Act or the
Exchange Act to the same extent as the foregoing indemnity to each
Underwriter, but only with reference to written information relating to
such Underwriter furnished to the Company by or on behalf of such
Underwriter specifically for inclusion in the documents referred to in
the foregoing indemnity. This indemnity agreement will be in addition
to any liability which any Underwriter may otherwise have. The Company
and each Selling Stockholder acknowledge that the statements set forth
(i) in the last paragraph of the cover page regarding delivery of the
Securities, (ii) under the heading "Underwriting",
29
(iii) the sentences related to concessions and reallowances and (iv)
the paragraph related to stabilization, syndicate covering transactions
and penalty bids in any Preliminary Prospectus and the Prospectus
constitute the only information furnished in writing by or on behalf of
each Underwriter for inclusion in any Preliminary Prospectus or the
Prospectus.
(d) Promptly after receipt by an indemnified party under
this Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the commencement thereof; but the
failure so to notify the indemnifying party (i) will not relieve it
from liability under paragraph (a), (b) or (c) above unless and to the
extent it did not otherwise learn of such action and such failure
results in the forfeiture by the indemnifying party of substantive
rights and defenses and (ii) will not, in any event, relieve the
indemnifying party from any obligations to any indemnified party other
than the indemnification obligation provided in paragraph (a), (b) or
(c) above. The indemnifying party shall be entitled to appoint counsel
of the indemnifying party's choice at the indemnifying party's expense
to represent the indemnified party in any action for which
indemnification is sought (in which case the indemnifying party shall
not thereafter be responsible for the fees and expenses of any separate
counsel retained by the indemnified party or parties except as set
forth below); provided, however, that such counsel shall be
satisfactory to the indemnified party. Notwithstanding the indemnifying
party's election to appoint counsel to represent the indemnified party
in an action, the indemnified party shall have the right to employ
separate counsel (including local counsel), and the indemnifying party
shall bear the reasonable fees, costs and expenses of such separate
counsel if (i) the use of counsel chosen by the indemnifying party to
represent the indemnified party would present such counsel with a
conflict of interest, (ii) the actual or potential defendants in, or
targets of, any such action include both the indemnified party and the
indemnifying party and the indemnified party shall have reasonably
concluded 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, (iii) the indemnifying party shall
not have employed counsel satisfactory to the indemnified party to
represent the indemnified party within a reasonable time after notice
of the institution of such action or (iv) the indemnifying party shall
authorize the indemnified party to employ separate counsel at the
expense of the indemnifying party; provided, however, that in
connection with such action the indemnifying party shall not be liable
for the expenses of more than one separate counsel (in addition to
local counsel in any relevant jurisdiction). An indemnifying party
shall not be liable for any settlement effected without its prior
written consent, such consent not to be unreasonably delayed,
conditioned or withheld. An indemnifying party will not, without the
prior written consent of the indemnified parties, settle or compromise
or consent to the entry of any judgment with respect to any pending or
threatened claim, action, suit or proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not
the indemnified parties are actual or potential parties to such claim
or action) unless such settlement, compromise or consent includes an
unconditional release of each indemnified party from all liability
arising out of such claim, action, suit or proceeding.
30
(e) In the event that the indemnity provided in paragraph
(a), (b) or (c) of this Section 8 is unavailable to or insufficient to
hold harmless an indemnified party for any reason, the Company, the
Selling Stockholders and the Underwriters agree to contribute to the
aggregate losses, claims, damages and liabilities (including legal or
other expenses reasonably incurred in connection with investigating or
defending same) (collectively "Losses") to which the Company, one or
more of the Selling Stockholders and one or more of the Underwriters
may be subject in such proportion as is appropriate to reflect the
relative benefits received by the Company, the Selling Stockholders and
the Underwriters from the offering of the Securities; provided,
however, that in no case shall any Underwriter be responsible for any
amount in excess of the underwriting discount or commission applicable
to the Securities purchased by such Underwriter hereunder. If the
allocation provided by the immediately preceding sentence is
unavailable for any reason, the Company, the Selling Stockholders and
the Underwriters shall contribute in such proportion as is appropriate
to reflect not only such relative benefits but also the relative fault
of the Company, the Selling Stockholders and the Underwriters in
connection with the statements or omissions which resulted in such
Losses as well as any other relevant equitable considerations. Benefits
received by the Company and the Selling Stockholders shall be deemed to
be equal to the total net proceeds from the offering (before deducting
expenses) received by them, and benefits received by the Underwriters
shall be deemed to be equal to the total underwriting discounts and
commissions, in each case as set forth on the cover page of the
Prospectus. Relative fault shall be determined by reference to, among
other things, whether any untrue or any alleged untrue statement of a
material fact or the omission or alleged omission to state a material
fact relates to information provided by the Company or the Selling
Stockholders on the one hand or the Underwriters on the other, the
intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such untrue statement
or omission. The Company, the Selling Stockholders and the Underwriters
agree that it would not be just and equitable if contribution were
determined by pro rata allocation or any other method of allocation
that does not take account of the equitable considerations referred to
above. Notwithstanding the provisions of this paragraph (e), no person
guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. For purposes of
this Section 8, each person who controls an Underwriter within the
meaning of either the Act or the Exchange Act and each director,
officer, employee and agent of such Underwriter shall have the same
rights to contribution as such Underwriter, and each person who
controls the Company within the meaning of either the Act or the
Exchange Act, each officer of the Company who shall have signed the
Registration Statement and each director of the Company shall have the
same rights to contribution as the Company, subject in each case to the
applicable terms and conditions of this paragraph (e).
(f) The total liability of each Selling Stockholder under
such Selling Stockholder's representations and warranties contained in
Section 1 hereof and under the indemnity and contribution agreements
contained in this Section 8 shall be limited to an amount equal to the
net proceeds received by such Selling Stockholder from the sale of the
Securities to the Underwriter. The Company and the Selling Stockholders
may agree, as among
31
themselves and without limiting the rights of any Underwriter under
this Agreement, as to the respective amounts of such liability for
which they each shall be responsible.
9. Default by an Underwriter. If any one or more
Underwriters shall fail to purchase and pay for any of the Securities agreed to
be purchased by such Underwriter or Underwriters hereunder and such failure to
purchase shall constitute a default in the performance of its or their
obligations under this Agreement, the remaining Underwriters shall be obligated
severally to take up and pay for (in the respective proportions which the amount
of Securities set forth opposite their names in Schedule I hereto bears to the
aggregate amount of Securities set forth opposite the names of all the remaining
Underwriters) the Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase; provided, however, that in the event that the
aggregate amount of Securities which the defaulting Underwriter or Underwriters
agreed but failed to purchase shall exceed 10% of the aggregate amount of
Securities set forth in Schedule I hereto, the remaining Underwriters shall have
the right to purchase all, but shall not be under any obligation to purchase
any, of the Securities, and if such nondefaulting Underwriters do not purchase
all the Securities, this Agreement will terminate without liability to any
nondefaulting Underwriter, the Selling Stockholders or the Company. In the event
of a default by any Underwriter as set forth in this Section 9, the Closing Date
shall be postponed for such period, not exceeding five Business Days, as the
Underwriters shall determine in order that the required changes in the
Registration Statement and the Prospectus or in any other documents or
arrangements may be effected. Nothing contained in this Agreement shall relieve
any defaulting Underwriter of its liability, if any, to the Company, the Selling
Stockholders and any nondefaulting Underwriter for damages occasioned by its
default hereunder.
10. Termination. This Agreement shall be subject to
termination in the sole discretion of the Underwriters, by notice given to the
Company prior to delivery of and payment for the Securities, if at any time
prior to such time (i) trading in the Company's Common Stock shall have been
suspended by the Commission or trading in securities generally on the New York
Stock Exchange shall have been suspended or limited or minimum prices shall have
been established on such Exchange, (ii) a general banking moratorium shall have
been declared either by Federal or New York State authorities or (iii) there
shall have occurred any outbreak or escalation of hostilities, declaration by
the United States of a national emergency or war, or other calamity or crisis
the effect of which on financial markets is such as to make it, in the sole
judgment of the Underwriters, impractical or inadvisable to proceed with the
offering or delivery of the Securities as contemplated by the Prospectus
(exclusive of any supplement thereto).
11. Representations and Indemnities to Survive. The
respective agreements, representations, warranties, indemnities and other
statements of the Company or its officers, of each Selling Stockholder and of
the Underwriters set forth in or made pursuant to this Agreement will remain in
full force and effect, regardless of any investigation made by or on behalf of
the Underwriters, any Selling Stockholder or the Company or any of the officers,
directors, employees, agents or controlling persons referred to in Section 8
hereof, and will survive delivery of and payment for the Securities. The
provisions of Sections 7 and 8 hereof shall survive the termination or
cancellation of this Agreement.
12. Notices. All communications hereunder will be in
writing and effective only on receipt, and, if sent to the Underwriters, will be
mailed, delivered or telefaxed to the
32
Citigroup Global Markets Inc. General Counsel (fax no.: (000) 000-0000) and
confirmed to the General Counsel, Citigroup Global Markets Inc., at 000
Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention: General Counsel; or, if
sent to the Company, will be mailed to 0000 X. Xxxxxxx Xxxxx, Xxxxxxxxx, XX
00000 or telefaxed to (000) 000-0000, and confirmed to it at attention of the
Legal Department and Xxxx Xxxxx Xxxxxxx Xxxxxxx & Xxxxxxxx LLP, 0000 Xxxxxx xx
xxx Xxxxxxxx, Xxx Xxxx, XX 00000-0000 or telefaxed to (000) 000-0000; attention:
Xxxxxxx X. Xxxxxxxx, Esq.; or if sent to any Selling Stockholder, will be
mailed, delivered or telefaxed and confirmed to it at the address set forth in
Schedule II hereto.
13. Successors. This Agreement will inure to the benefit
of and be binding upon the parties hereto and their respective successors and
the officers, directors, employees, agents and controlling persons referred to
in Section 8 hereof, and no other person will have any right or obligation
hereunder.
14. Applicable Law. This Agreement will be governed by
and construed in accordance with the laws of the State of New York applicable to
contracts made and to be performed within the State of New York.
15. Counterparts. This Agreement may be signed in one or
more counterparts, each of which shall constitute an original and all of which
together shall constitute one and the same agreement.
16. Headings. The section headings used herein are for
convenience only and shall not affect the construction hereof.
17. Definitions. The terms which follow, when used in
this Agreement, shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the rules
and regulations of the Commission promulgated thereunder.
"Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday or a day on which banking institutions or trust companies are
authorized or obligated by law to close in New York City.
"Canadian Person" shall mean any person who is a national or resident
of Canada, any corporation, partnership, or other entity created or organized in
or under the laws of Canada or of any political subdivision thereof, or any
estate or trust' the income of which is subject to Canadian Federal income
taxation, regardless of its source (other than any non-Canadian branch of any
United States or Canadian Person), and shall include any Canadian branch of a
person other than a Canadian Person.
"Commission" shall mean the Securities and Exchange Commission.
"Effective Date" shall mean each date and time that the Registration
Statement, any post-effective amendment or amendments thereto and any Rule
462(b) Registration Statement became or become effective.
33
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Preliminary Prospectus" shall mean any preliminary prospectus,
including information incorporated by reference therein, referred to in
paragraph l(i)(a) above and any preliminary prospectus included in the
Registration Statement at the Effective Date that omits Rule 430A Information.
"Prospectus" shall mean the prospectus, including information
incorporated by reference therein, relating to the Securities that is first
filed pursuant to Rule 424(b) after the Execution Time or, if no filing pursuant
to Rule 424(b) is required, shall mean the form of final prospectus relating to
the Securities included in the Registration Statement at the Effective Date.
"Registration Statement" shall mean the registration statement,
including information incorporated by reference therein, referred to in
paragraph l(i)(a) above, including exhibits and financial statements, as amended
at the Execution Time (or, if not effective at the Execution Time, in the form
in which it shall become effective) and, in the event any post-effective
amendment thereto or any Rule 462(b) Registration Statement becomes effective
prior to the Closing Date, shall also mean such registration statement as so
amended or such Rule 462(b) Registration Statement, as the case may be. Such
term shall include any Rule 430A Information deemed to be included therein at
the Effective Date as provided by Rule 430A.
"Rule 424", "Rule 430A" and "Rule 462" refer to such rules under the
Act.
"Rule 430A Information" shall mean information with respect to the
Securities and the offering thereof permitted to be omitted from the
Registration Statement when it becomes effective pursuant to Rule 430A.
"Rule 462(b) Registration Statement" shall mean a registration
statement and any amendments thereto filed pursuant to Rule 462(b) relating to
the offering covered by the registration statement referred to in Section 1(a)
hereof.
18. Canada. Each of the Underwriters hereby covenants and
agrees that it will not distribute the Securities in such a manner as to require
the filing of a prospectus or similar document (excluding a private placement
offering memorandum) with respect to the Securities under the laws of any
Province or Territory in Canada.
34
If the foregoing is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicate hereof,
whereupon this letter and your acceptance shall represent a binding agreement
among the Company, the Selling Stockholders and the several Underwriters.
THE COMPANY:
INTERSTATE HOTELS & RESORTS, INC.
By: ______________________________
Name:
Title:
THE SELLING STOCKHOLDERS:
CGLH PARTNERS I LP
By: MK/CG-GP LLC
General Partner
By: CG Interstate Associates, LLC
a Managing Member
By: Continental Gencom Holdings, LLC
its Sole Member
By: ______________________________
Name:
Title: Member
By: ______________________________
Name:
Title: Member
By: KFP Interstate, LLC, a Managing Member
By: KFP Holdings, Ltd., its Sole Member
By: Xxxxxxxxx, X.X., its General Partner
By: ______________________________
Name:
Title: Authorized Signatory
By: LB INTERSTATE GP LLC
General Partner
By: PAMI LLC
its Sole Member
By: ______________________________
Name:
Title: Authorized Signatory
CGLH PARTNERS II LP
By: MK/CG-GP LLC
General Partner
By: CG Interstate Associates, LLC
a Managing Member
By: Continental Gencom Holdings, LLC
its Sole Member
By: ______________________________
Name:
Title: Member
By: ______________________________
Name:
Title: Member
By: KFP Interstate, LLC, a Managing Member
By: KFP Holdings, Ltd., its Sole Member
By: Xxxxxxxxx, X.X., its General Partner
By: ______________________________
Name:
Title: Authorized Signatory
By: LB INTERSTATE GP LLC
General Partner
By: PAMI LLC
its Sole Member
By: ______________________________
Name:
Title: Authorized Signatory
37
The foregoing Agreement is hereby confirmed and accepted as of the date first
above written.
THE UNDERWRITERS:
CITIGROUP GLOBAL MARKETS INC.
For themselves and for the other Underwriters listed on Schedule I herein:
By: CITIGROUP GLOBAL MARKETS INC.
By: _______________________
Name:
Title:
38
SCHEDULE I
NUMBER OF NUMBER OF
UNDERWRITTEN UNDERWRITTEN
NUMBER OF UNDERWRITTEN MAXIMUM NUMBER OF SECURITIES TO BE SECURITIES TO BE
SECURITIES TO BE SECURITIES TO BE PURCHASED FROM PURCHASED FROM
UNDERWRITERS PURCHASED FROM COMPANY PURCHASED FROM COMPANY CGLH I CGLH II
------------ ----------------------- ---------------------- ---------------- ----------------
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx,
Xxx Xxxx, XX 00000
Credit Lyonnais Securities (USA) Inc.
0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, XX 00000
XX Xxxxx Securities Corporation
0000 Xxxxxx xx xxx Xxxxxxxx,
Xxx Xxxx, XX 00000
Total.......................... ======================= ======================
SCHEDULE II
NUMBER OF UNDERWRITTEN
----------------------
SECURITIES TO BE SOLD
---------------------
SELLING STOCKHOLDERS:
CGLH Partners I L.P.
c/o Lehman Brothers Holdings, Inc.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
CGLH Partners II L.P.
c/x Xxxxxx Brothers Holdings, Inc.
000 Xxxx Xxxxxx, 0xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxxxxx
Total.......................... ======================= ======================
EXHIBIT A
[LETTERHEAD OF OFFICER OR DIRECTOR OF CORPORATION]
Interstate Hotels & Resorts, Inc.
Public Offering of Common Stock
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the
proposed Underwriting Agreement (the "Underwriting Agreement"), among Interstate
Hotels & Resorts, Inc., a Delaware corporation (the "Company"), the Selling
Stockholders named therein and you as the Underwriter named therein, relating to
an underwritten public offering of Common Stock, $0.01 par value (the "Common
Stock"), of the Company.
In order to induce you to enter into the Underwriting
Agreement, the undersigned will not, without the prior written consent of
Citigroup Global Markets Inc., offer, sell, contract to sell, pledge or
otherwise dispose of (or enter into any transaction which is designed to, or
might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by the undersigned or any affiliate of the undersigned or any person
in privity with the undersigned or any affiliate of the undersigned), directly
or indirectly, including the filing (or participation in the filing) of a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
shares of capital stock of the Company or any securities convertible into, or
exercisable or exchangeable for such capital stock, or publicly announce an
intention to effect any such transaction, for a period of 90 days after the date
of the Underwriting Agreement, other than shares of Common Stock disposed of as
bona fide gifts approved by Citigroup Global Markets Inc.
If for any reason the Underwriting Agreement shall be
terminated prior to the Closing Date (as defined in the Underwriting Agreement),
the agreement set forth above shall likewise be terminated.
EXHIBIT B
OAK HILL CAPITAL PARTNERS, L.P.
OAK HILL CAPITAL MANAGEMENT PARTNERS, L.P.
000 XXXX XXXXXX, XXXXX 0000
XXXX XXXXX, XX 00000
Interstate Hotels & Resorts, Inc.
Public Offering of Common Stock
November___, 2003
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
This letter is being delivered to you in connection with the
proposed Underwriting Agreement (the "Underwriting Agreement"), among Interstate
Hotels & Resorts, Inc., a Delaware corporation (the "Company"), the Selling
Stockholders named therein and you as the Underwriter named therein, relating to
an underwritten public offering of Common Stock, $.01 par value (the "Common
Stock"), of the Company.
In order to induce you to enter into the Underwriting
Agreement, the undersigned will not, without the prior written consent of
Citigroup Global Markets Inc., offer, sell, contract to sell, pledge or
otherwise dispose of (or enter into any transaction which is designed to, or
might reasonably be expected to, result in the disposition (whether by actual
disposition or effective economic disposition due to cash settlement or
otherwise) by the undersigned or any affiliate of the undersigned or any person
in privity with the undersigned or any affiliate of the undersigned), directly
or indirectly, including the filing (or participation in the filing) of a
registration statement with the Securities and Exchange Commission in respect
of, or establish or increase a put equivalent position or liquidate or decrease
a call equivalent position within the meaning of Section 16 of the Securities
Exchange Act of 1934, as amended, and the rules and regulations of the
Securities and Exchange Commission promulgated thereunder with respect to, any
shares of capital stock of the Company or any securities convertible into, or
exercisable or exchangeable for such capital stock, or publicly announce an
intention to effect any such transaction, for a period of 90 days after the date
of the Underwriting Agreement, other than: (A) transfers by way of testate or
intestate succession or by operation of law, (B) transfers to members of the
immediate family of the undersigned or to a trust, partnership, limited
liability company or other entity, all of the beneficial interests of which are
held by the undersigned or by a member of the undersigned's immediate family,
(C) transfers to charitable organizations, (D) if the undersigned is, or
controls, a corporation, partnership, limited liability company or similar
entity, transfers to the stockholders, partners, members or similar persons of
such entity, and (E)(i) exercising of options, warrants or rights existing on
the date hereof or pursuant to currently outstanding options, warrants or
rights; and (ii) in connection with an exercise of E(i) above, delivery to the
Company of shares of Common Stock as payment of the exercise price for such
options, warrants or rights, or the withholding taxes payable in connection with
such exercise. (provided that in each case of a transfer pursuant to clauses (A)
- (D) of this sentence, the transferee shall have agreed to be bound by the
restrictions on transfer contained above.)
In furtherance of the foregoing, the Company and its transfer
agent are hereby authorized to decline to make any transfer of securities if
such transfer would constitute a violation or breach of this letter.
It is understood that, if the Company notifies you that it
does not intend to proceed with the offering, if the Underwriting Agreement does
not become effective or if the Underwriting Agreement (other than the provisions
thereof which survive termination) shall terminate or be terminated prior to
payment for and delivery of the Common Stock, the undersigned shall be released
from its obligations under this letter.
The undersigned understands that the Company and the
Underwriter will proceed with the offering in reliance on this letter.
Whether or not the offering actually occurs depends on a
number of factors, including market conditions. Any offering will only be made
pursuant to an Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriter.
Yours very truly,
OAK HILL CAPITAL PARTNERS, L.P.
By: OHCP GENPAR, L.P., general partner
By: OHCP MGP, L.L.C., general partner
By: _________________________________
OAK HILL CAPITAL MANAGEMENT PARTNERS, L.P.
By: OHCP GENPAR, L.P., general partner
By: OHCP MGP, L.L.C., general partner
By: _________________________________
EXHIBIT C
JOINDER
The undersigned, a proposed transferee (the "Transferee") of shares of
Common Stock (the "Shares") of Interstate Hotels & Resorts, Inc., a Delaware
corporation (the "Company"), from CGLH Partners I LP and CGLH Partners II LP
(collectively, the "Transferor"), hereby agrees to be bound by all of the
provisions of Section 5(ii)(a) of the Underwriting Agreement, dated as of _____,
by and among the Transferor, Citigroup Global Markets, Inc., Credit Lyonnais
Securities (USA) Inc., XX Xxxxx Securities Corporation and the Company which are
applicable to the Transferor at the time of transfer of the Shares.
Dated as of ______________, __________
