EXHIBIT 11(c)(2)
SUPPORT AGREEMENT dated as of November 22, 1997 (the "Agreement")
between CYRUS ACQUISITION CORP., a New York corporation ("Purchaser"), and
XXXXXX X. XXXXXX, a resident of Greenwich, Connecticut (the "Shareholder").
WHEREAS, Purchaser and General Host Corporation (the "Company"), a New
York corporation, propose to enter into an Agreement and Plan of Merger dated as
of the date hereof (as the same may be amended or supplemented, the "Merger
Agreement"; capitalized terms used but not defined herein shall have the
meanings set forth in the Merger Agreement) pursuant to which, among other
things, Purchaser will agree to make a tender offer (the "Offer") for all
outstanding shares of common stock, par value $1.00 per share (the "Common
Stock"), of the Company, net to the seller in cash, to be followed by a merger
(the "Merger") of Purchaser with and into the Company, upon the terms and
subject to the conditions set forth in the Merger Agreement; and
WHEREAS, the Shareholder owns the number of shares of Common Stock set
forth opposite his name on the signature page of this Agreement (such shares of
Common Stock, together with any other shares of Common Stock acquired by the
Shareholder after the date hereof and during the term of this Agreement whether
upon the exercise of options, warrants or rights, the conversion or exchange of
convertible or exchangeable securities, or by means of purchase, dividend,
distribution or otherwise, being collectively referred to herein as the "Subject
Shares"); and
WHEREAS, as a condition to its willingness to enter into the Merger
Agreement, Purchaser has required that the Shareholder enter into this
Agreement;
NOW, THEREFORE, to induce Purchaser to enter into, and in
consideration of its entering into, the Merger Agreement, and in consideration
of the premises and the representations, warranties and agreements contained
herein, the parties agree as follows:
1. Representations and Warranties of the Shareholders. The
Shareholder hereby represents and warrants to Purchaser as of the date hereof in
respect of himself as follows:
(a) Authority. The Shareholder has all requisite power and authority
to enter into this Agreement, to perform its obligations hereunder and to
consummate the transactions contemplated hereby. This Agreement has been
duly authorized, executed and delivered by the Shareholder and constitutes
a valid and binding obligation of the Shareholder enforceable in accordance
with its terms subject to (i) applicable bankruptcy, insolvency,
moratorium, or other similar laws relating to creditors' rights and general
principles of bankruptcy and (ii) general principles of equity (regardless
of whether considered in a proceeding at
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law or in equity). The execution and delivery of this Agreement do not,
and the consummation of the transactions contemplated hereby and compliance
with the terms hereof will not (i) conflict with or violate any law,
statute, rule, regulation, order, judgment or decree applicable to the
Shareholder or by which the Shareholder or any of his properties is bound
or affected, or (ii) conflict with or result in any breach or violation of
or constitute a default (or an event which with notice or lapse of time or
both could become a default) or result in the loss of a material benefit
under, or give rise to any right of termination, amendment, acceleration or
cancellation of, or result in the creation of a lien or encumbrance on any
of the properties or assets of the Shareholder pursuant to, any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise
or other instrument or obligation to which the Shareholder is a party or by
which the Shareholder or any of his properties is bound or affected.
(b) The Subject Shares. The Shareholder is the record and beneficial
owner of, and has good and marketable title to, the Subject Shares set
forth opposite his or its name on the signature page of this Agreement,
free and clear of any claims, liens, encumbrances and security interests
whatsoever. The Shareholder does not own, of record or beneficially, any
shares of capital stock of the Company other than the Subject Shares set
forth opposite his or its name on the signature page of this Agreement.
The Shareholder has the sole right to vote, and the sole power of
disposition with respect to, such Subject Shares, and none of such Subject
Shares is subject to any voting trust or other agreement, arrangement or
restriction with respect to the voting or disposition of such Subject
Shares, except as contemplated by this Agreement.
2. Representations and Warranties of Purchaser. Purchaser hereby
represents and warrants to the Shareholder that Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of New York and
has all requisite corporate power and authority to enter into this Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by Purchaser,
and the consummation of the transactions contemplated hereby, have been duly
authorized by all necessary corporate action on the part of Purchaser. This
Agreement has been duly executed and delivered by Purchaser and constitutes a
valid and binding obligation of Purchaser enforceable in accordance with its
terms subject to (i) applicable bankruptcy, insolvency, moratorium, or other
similar laws relating to creditors' rights and general principles of bankruptcy
and (ii) general principles of equity (regardless of whether considered in a
proceeding at law or in equity). The execution and delivery of this Agreement
do not, and the consummation of the transactions contemplated hereby and
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compliance with the terms hereof will not (i) conflict with or violate any law,
statute, rule, regulation, order, judgment or decree applicable to Purchaser or
by which Purchaser or any of its properties is bound or affected, or (ii)
conflict with or result in any breach or violation of or constitute a default
(or an event which with notice or lapse of time or both could become a default)
or result in the loss of a material benefit under, or give rise to any right of
termination, amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the properties or assets of
Purchaser pursuant to, any provision of the certificate of incorporation or
by-laws of Purchaser or any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which Purchaser is a party or by which Purchaser or any of its properties is
bound or affected.
3. Covenants of the Shareholder. Until the termination of this
Agreement in accordance with Section 6, the Shareholder agrees as follows:
(a) To (or cause the record owner thereof to) validly tender and not
withdraw, all the Subject Shares, pursuant to and in accordance with the
terms of the Offer. The Shareholder hereby acknowledges and agrees that
Purchaser's obligation to accept for payment and pay for shares of Common
Stock in the Offer, including any Subject Shares tendered by such
Shareholder, is subject to the terms and conditions of the Offer.
(b) At any meeting of shareholders of the Company held prior to the
consummation of the Offer and called to vote upon the Merger, the Merger
Agreement or any of the other transactions contemplated by the Merger
Agreement or at any adjournment thereof or in any other circumstances in
which a vote, consent or other approval with respect to the Merger, the
Merger Agreement or any of the other transactions contemplated by the
Merger Agreement is sought, the Shareholder shall vote (or cause to be
voted) the Subject Shares in favor of the Merger, the adoption by the
Company of the Merger Agreement and the approval of the terms thereof and
each of the other transactions contemplated by the Merger Agreement.
(c) At any meeting of shareholders of the Company or at any
adjournment thereof or in any other circumstances in which the
Shareholder's vote, consent or other approval is sought and which meeting
is held or other action is taken prior to the consummation of the Offer,
the Shareholder shall vote (or cause to be voted) the Subject Shares
against (i) any merger agreement or merger (other than the Merger Agreement
and the Merger), consolidation, combination, sale of all or substantial
assets, reorganization, recapitalization, dissolution, liquidation or
winding-up of or by the Company or any other takeover proposal or
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Acquisition Proposal (as such term is defined in the Merger Agreement) or
(ii) any amendment of the Company's certificate of incorporation or by-laws
or other proposal or transaction involving the Company or any of its
subsidiaries, which amendment or other proposal or transaction would in any
manner impede, frustrate, prevent or nullify the Merger, the Merger
Agreement or any of the other transactions contemplated by the Merger
Agreement, or would change in any manner the voting rights of the Common
Stock. The Shareholder further agrees not to commit or agree to take any
action inconsistent with the foregoing.
(d) The Shareholder hereby grants to, and appoints Purchaser and any
designee of Purchaser, each of them individually, Shareholder's irrevocable
(until the termination of this Agreement) proxy and attorney-in-fact (with
full power of substitution) to vote the Subject Shares of Shareholder as
indicated in Section 3(b) and 3(c) above. The Shareholder intends this
proxy to be irrevocable (until the termination of this Agreement) and
coupled with an interest and will take such further action or execute such
other instruments as may be necessary to effectuate the intent of this
proxy and Agreement (including, if requested by Purchaser, causing an
appropriate legend to be affixed to the certificates representing such
Subject Shares regarding the provisions of this Agreement) and hereby
revokes any proxy previously granted by the Shareholder with respect to
such Shareholder's Subject Shares.
(e) The Shareholder agrees not to (i) sell, transfer, pledge, assign
or otherwise dispose of (including by gift) (collectively, "Transfer"), or
enter into any contract, option or other arrangement (including any
profit-sharing arrangement) with respect to the Transfer of, the Subject
Shares to any person other than pursuant to the terms of the Merger and the
Offer or (ii) enter into any voting arrangement, whether by proxy, voting
agreement or otherwise, in connection with, directly or indirectly, any
Acquisition Proposal, and agrees not to commit or agree to take any of the
foregoing actions. Notwithstanding anything to the contrary provided in
this Agreement, Shareholder shall have the right to Transfer Subject Shares
to (i) any Family Member, (ii) the trustee or trustees of a trust solely
for the benefit of Shareholder and/or one or more Family Members, (iii) a
foundation created or established by Shareholder, (iv) a corporation of
which Shareholder and/or any Family Member owns all of the outstanding
capital stock, (v) a partnership of which Shareholder and/or any Family
Members owns all of the partnership interests, (vi) the executor,
administrator or personal representative of the estate of Shareholder, or
(vii) any guardian, trustee or conservator appointed with respect to the
assets of Shareholder; provided, that in the case of any such Transfer, the
transferee shall execute an agreement to be
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bound by the terms of this Agreement, or terms substantially identical
thereto. "Family Member" shall have the meaning ascribed to "Related
Parties" under Section 672(c) of the Internal Revenue Code of 1986, as
amended.
(f) Until the termination of this Agreement, Shareholder will comply
with the provisions of Section 6.5 of the Merger Agreement to the extent
applicable to Shareholder in his capacity as a director or officer of the
Company; provided, that nothing in this Section 3(f) shall prohibit
Shareholder from taking any actions that the Company is permitted to take
in accordance with Section 6.5 of the Merger Agreement.
4. Further Assurances. The Shareholder will, from time to time,
execute and deliver, or cause to be executed and delivered, such additional or
further consents, documents and other instruments as Purchaser may reasonably
request for the purpose of effectively carrying out the transactions
contemplated by this Agreement.
5. Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any of the parties
without the prior written consent of the other parties, except as provided in
Section 3(e) and except that Purchaser may assign, in its sole discretion, any
or all of its rights, interests and obligations hereunder to any affiliate (as
such term is defined in the Merger Agreement) of Purchaser. Subject to the
preceding sentence, this Agreement will be binding upon, inure to the benefit of
and be enforceable by the parties and their respective successors and assigns.
6. Termination. This Agreement shall terminate upon the earlier of
(a) the date upon which Purchaser shall have purchased all of the Subject Shares
of the Shareholder in accordance with the Offer and the Merger and (b) the date
on which the Merger Agreement is terminated in accordance with its terms.
7. General Provisions.
(a) Amendments. This Agreement may not be amended except by an
instrument in writing signed by each of the parties hereto.
(b) Notice. All notices and other communications hereunder shall be
in writing and shall be deemed given if delivered personally or sent by
overnight courier (providing proof of delivery) to Purchaser in accordance
with Section 9.2 of the Merger Agreement and to the Shareholder at his
address set forth on the signature page of this Agreement (or at such other
address for a party as shall be specified by like notice).
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(c) Interpretation. Unless other indicated, references made in this
Agreement to Sections shall be to Sections to this Agreement. The headings
contained in this Agreement are for reference purposes only and shall not
affect in any way the meaning or interpretation of this Agreement.
Wherever the words "include", "includes" or "including" are used in this
Agreement, they shall be deemed to be followed by the words "without
limitation".
(d) Counterparts. This Agreement may be executed in one or more
counterparts, all of which shall be considered one and the same agreement,
and shall become effective when one or more of the counterparts have been
signed by each of the parties and delivered to the other party, it being
understood that each party need not sign the same counterpart.
(e) Entire Agreement; No Third-Party Beneficiaries. This Agreement
(including the documents and instruments referred to herein) (i)
constitutes the entire agreement, and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to
the subject matter hereof and (ii) is not intended to confer upon any
person other than the parties hereto any rights or remedies hereunder.
(f) Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York regardless
of the laws that might otherwise govern under applicable principles of
conflicts of law thereof.
8. Shareholder Capacity. No person executing this Agreement who is
or becomes during the term hereof a director or officer of the Company makes any
agreement or understanding herein in his capacity as such director or officer.
The Shareholder signs solely in his capacity as the record holder and beneficial
owner of, or the trustee of a trust whose beneficiaries are the beneficial
owners of, such Shareholder's Subject Shares and nothing herein shall limit or
affect any actions taken by a Shareholder in his capacity as a director or
officer of the Company including in the exercise of his fiduciary duties as a
director and officer of the Company.
9. Enforcement. The parties agree that irreparable damage would
occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached.
It is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any court of the United States
located in the State of New York or in a New York state court, this being in
addition to any other remedy to which they are entitled at law or in equity. In
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addition, each of the parties hereto (i) consents to submit such party to the
personal jurisdiction of any Federal court located in the State of New York or
any New York state court in the event any dispute arises out of this Agreement
or any of the transactions contemplated hereby, (ii) agrees that such party will
not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court; (iii) agrees that such party will not
bring any action relating to this Agreement or the transactions contemplated
hereby in any court other than a Federal court sitting in the State of New York
or a New York state court and (iv) waives any right to trial by jury with
respect to any claim or proceeding related to or arising out of this Agreement.
IN WITNESS WHEREOF, Purchaser has caused this Agreement to be signed
by its officer thereunto duly authorized and the Shareholder has signed this
Agreement, all as of the date first written above.
CYRUS ACQUISITION CORP.
By: /s/ Xxxxx X. Xxxxxxxx
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Name: Xxxxx X. Xxxxxxxx
Title: President
Number of Subject Shares: Shareholder:
1,532,157
/s/ Xxxxxx X. Xxxxxx
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Name: Xxxxxx X. Xxxxxx
Address: 000 Xxxxxxxxx Xxxxx Xx.
Xxxxxxxxx, XX 00000
