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EXHIBIT 99.7
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VOTING AND COOPERATION AGREEMENT
BY AND AMONG
FELCOR SUITE HOTELS, INC.
BRISTOL HOTEL COMPANY
BASS AMERICA INC.
HOLIDAY CORPORATION
AND
UNITED/▇▇▇▇▇▇ HOLDINGS, L.P.
DATED MARCH 23, 1998
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VOTING AND COOPERATION AGREEMENT
This VOTING AND COOPERATION AGREEMENT (this "Agreement"), is made and
entered into as of March 23, 1998, by and among FelCor Suite Hotels, Inc., a
Maryland corporation ("FelCor"), Bristol Hotel Company, a Delaware corporation
("Bristol"), Bass America Inc., a Delaware corporation ("BAI"), Holiday
Corporation, a Delaware corporation ("HC"), and United/▇▇▇▇▇▇ Holdings, L.P., a
Delaware limited partnership ("Holdings" and, together with BAI, HC and any
transferee that acquires Subject Shares that agrees to be bound by this
Agreement, the "Stockholders").
RECITALS
A. FelCor and Bristol propose to enter into an Agreement and Plan of
Merger, dated as of the date hereof (the "Merger Agreement"), pursuant to which
Bristol will merge with and into FelCor (the "Merger") upon the terms and
subject to the conditions set forth in the Merger Agreement.
B. Prior to the consummation of the Merger, Bristol intends to
distribute to the holders of Bristol Common Shares all of the issued and
outstanding common stock, par value $0.01 per share ("BHR Common Shares"), of
Bristol Hotels and Resorts, Inc., a Delaware corporation ("BHR") (the "Spin-
Off").
C. As of the date hereof, each Stockholder owns of record the number
of Bristol Common Shares set forth opposite the Stockholder's name on Schedule
A hereto (such Bristol Common Shares, together with any other Bristol Common
Shares acquired by, and not including any Bristol Common Shares sold by, such
Stockholder from the date hereof through the Record Date for the Bristol
Stockholders Meeting, are collectively referred to herein as such Stockholder's
"Subject Shares").
D. Bristol, Holdings, HC, BAI and Bass plc entered into a
Stockholders' Agreement, dated as of April 28, 1997 (the "Old Stockholders'
Agreement"), and Bristol, Holdings, HC and BAI entered into a Registration
Rights Agreement, dated as of April 28, 1997 (the "Old Registration Rights
Agreement").
E. The parties hereto desire that the Merger and the Spin-Off occur,
and accordingly have agreed to take certain actions that are necessary in order
to satisfy certain of the conditions precedent to the Spin-Off and the Merger.
F. As a condition and inducement to FelCor's willingness to enter
into the Merger Agreement, FelCor has requested that
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each Stockholder agree, and each Stockholder has agreed, to enter into this
Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements herein contained, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
1. Agreement to Vote Shares. During the Term, at any meeting of the
stockholders of Bristol called to consider and vote upon the adoption of the
Merger Agreement or approval of the Spin-Off (if such approval is sought) (and
at any and all postponements and adjournments thereof), and in connection with
any action to be taken in respect of the adoption of the Merger Agreement and
approval of the Spin-Off by written consent of the stockholders of Bristol,
each Stockholder will vote or cause to be voted (including by written consent,
if applicable) all of such Stockholder's Subject Shares in favor of the
adoption of the Merger Agreement and approval of the Spin-Off and against any
Adverse Proposal. For purposes of this Agreement, (a) the term "Term" means
the period commencing on the date hereof and ending as of the earlier of (i)
the Effective Time and (ii) FelCor's or Bristol's giving of notice of the
termination of the Merger Agreement, regardless of whether the validity of such
notice or right to exercise termination is being or may thereafter be
contested, and (b) the term "Adverse Proposal" means any (i) Acquisition
Proposal, (ii) any change in the composition of a majority of the Board of
Directors of Bristol, and (iii) any other intentional action which is intended
or could reasonably be expected to hinder, delay or result in the failure of
the Merger to occur. Nothing herein, however, will prohibit or restrict any
Stockholder from pledging or otherwise disposing of (collectively, "Transfer")
any Subject Shares, provided, however, that (i) in connection with any Transfer
of more than 100,000 Subject Shares to a single purchaser effected pursuant to
a privately negotiated transaction or series of transactions, any Stockholder
will be required to obtain the agreement of such purchaser to be bound by the
covenants in this Section 1 and (ii) no Stockholder may Transfer any Subject
Shares if, following such Transfer, the aggregate number of Subject Shares that
is subject to the provisions of this Agreement would be less than a majority of
the issued and outstanding Bristol Common Shares as of the Record Date for the
Bristol Stockholders Meeting.
2. Other Agreements of BAI and HC. (a) On the date the Spin-Off is
effected, BAI and HC will, and will cause Holiday Hospitality Corporation to,
as appropriate:
(i) Enter into the Hotel Properties Agreement in substantially
the form attached hereto as Exhibit A;
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(ii) Enter into the Confirmation Agreement in substantially the
form attached hereto as Exhibit B;
(iii) Enter into the Stockholders' and Registration Rights
Agreement in substantially the form attached hereto as Exhibit C (the
"FelCor Stockholders' Agreement");
(iv) Enter into the Stockholders' Agreement in substantially
the form attached hereto as Exhibit D (the "BHR Stockholders'
Agreement"); and
(v) Enter into the Registration Rights Agreement in
substantially the form attached hereto as Exhibit E (the "BHR
Registration Rights Agreement").
(b) On or before the date the Spin-Off is effective, BAI and HC will
review and approve the form of lease to be entered into by BHR and FelCor, such
approval not to be unreasonably withheld or delayed.
(c) Immediately after the Spin-Off and prior to the Effective Time,
BAI and HC will Transfer to BHR for redemption that number of BHR Common Shares
equal to the excess of (i) the aggregate number of shares of BHR Common Shares
that such Stockholders may be deemed to own immediately following the Spin-Off
by virtue of the attribution provisions of Section 544 of the Code (as modified
by Section 856(h)(i)(B) of the Code) (assuming that BHR is a REIT for such
purposes) and/or Section 318 of the Code (as modified by Section 856(d)(5) of
the Code) (together, the "Attribution Rules") over (ii) the number of shares
that represent 9.9% of the total number of outstanding BHR Common Shares as of
the Spin-Off Time after giving effect to the redemption herein contemplated
(such shares, the "Excess Shares") in consideration for payment by BHR to BAI
and HC by wire transfer of cash in the aggregate amount of $25,814,200 (the
"Excess Shares Redemption Amount"). Each of BAI and HC will transfer a pro
rata portion of the Excess Shares based on the number of BHR Common Shares held
by it as compared to the aggregate BHR Common Shares held by BAI and HC. Upon
such redemption, BAI and HC will deliver to BHR such stock transfer forms,
stock powers, certificates and other documents evidencing the redemption of the
Excess Shares and confirming BAI's and HC's ownership of BHR Common Shares
immediately prior to the Effective Time and following the Excess Shares
Redemption as BHR may reasonably request.
(d) In the event that BAI, HC or any of their respective Affiliates
decreases the number of Bristol Common Shares held by such Stockholders between
the date hereof and the Spin-Off Time, the Excess Shares Redemption Amount will
be decreased, as appropriate, proportionately by an amount corresponding to the
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decrease in Excess Shares resulting from a change in such number of Bristol
Common Shares. In the event that BAI, HC or any of their respective Affiliates
increases the number of Bristol Common Shares held by such Stockholders between
the date hereof and the Spin-Off Time so as to result in an increase in the
number of Excess Shares from the number of Excess Shares determined as of the
date hereof, such Excess Shares will also be redeemed pursuant to Section 2(b)
with no corresponding increase in the Excess Shares Redemption Amount. Bristol
will not take any action without the prior written consent of the parties
hereto that would have the effect of increasing or decreasing the number of
Bristol Common Shares held by HC or BAI.
(e) Prior to the Effective Time, BAI and HC will not, and will cause
their Affiliates not to, increase or decrease the number of BHR Common Shares
held by such Stockholders (other than by virtue of a change in the number of
Bristol Common Shares held by such Stockholders between the date hereof and the
Spin-Off Time).
(f) Any Stockholder may transfer any or all of its Subject Shares to
an Affiliate of which such Stockholder owns a majority of the equity or other
ownership interests as long as such Affiliate agrees to be bound by the terms
of this Agreement on the same terms as the transferring Stockholder.
3. Other Agreements of Holdings. (a) Immediately after the
Spin-Off Time and prior to the Effective Time, Holdings will contribute all the
Bristol Common Shares it owns to two limited partnerships to be organized by
Holdings and its partners of which an affiliate of Holdings will be the general
partner (the "Partnerships") in such proportion as Holdings deems appropriate
and as FelCor approves, such approval not to be unreasonably withheld or
delayed. Upon such distribution, Holdings will deliver to BHR such stock
transfer forms, stock powers, certificates and other documents confirming
Holdings' and the Partnerships' ownership of Bristol Common Shares and BHR
Common Shares immediately prior to the Effective Time and following such
distributions.
(b) Prior to the Effective Time, Holdings will cause the Partnerships
to enter into the FelCor Stockholders' Agreement and Holdings will enter into
the BHR Stockholders' Agreement and the BHR Registration Rights Agreement.
4. Termination of Old Stockholders' Agreement and Old Registration
Rights Agreement. Effective as of the Effective Time, each of the parties
acknowledges and agrees that the Old Stockholders' Agreement and the Old
Registration Rights Agreement will, without any further action, terminate and
be of no further force and effect. Effective as of the Effective Time, each of
the parties acknowledges that the Management Stockholders
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Agreement, dated as of April 28, 1997, will, without any further action
terminate and be of no further force and effect.
5. Certain Representations, Warranties and Covenants of the
Stockholders. Each Stockholder, severally and not jointly, represents,
warrants and covenants to FelCor and Bristol as follows:
(a) Ownership. Except as specified on Schedule A, such Stockholder
is the sole record and beneficial owner of the number of Bristol Common Shares
set forth opposite such Stockholder's name on Schedule A and will have full and
unrestricted power to vote such shares. Such Stockholder does not own any
securities of Bristol on the date of this Agreement other than the Bristol
Common Shares and the options to purchase Bristol Common Shares described on
Schedule A. Except for transfers permitted pursuant to Section 1, at the
Record Date for the Bristol Stockholders Meeting, such Stockholder will be the
sole record and beneficial owner of the number of Bristol Common Shares set
forth opposite such Stockholder's name on Schedule A and will have full and
unrestricted power to vote such shares.
(b) Due Authorization. Such Stockholder has all requisite power and
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by such
Stockholder and the consummation by such Stockholder of the transactions
contemplated hereby have been duly authorized by all necessary action on the
part of such Stockholder. This Agreement has been duly executed and delivered
by such Stockholder and constitutes a valid and binding obligation of such
Stockholder, enforceable against such Stockholder in accordance with its terms,
subject to applicable bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and similar laws affecting creditors' rights
generally and to general principles of equity.
(c) No Conflicts. The execution and delivery of this Agreement do
not, and the consummation of the transactions contemplated by this Agreement
and compliance with the provisions of this Agreement will not, conflict with,
result in a breach or violation of or default (with or without notice or lapse
of time or both) under, or give rise to a material obligation, a right of
termination, cancellation or acceleration of any obligation or a loss of a
material benefit under, or require notice to or the consent of any person under
any agreement, instrument, undertaking, law, rule, regulation, judgment, order,
injunction, decree, determination or award binding on such Stockholder, other
than any such conflicts, breaches, violations, defaults, rights or losses that,
individually and in the aggregate, would not (a) impair the ability of such
Stockholder to perform such Stockholder's obligations under this Agreement or
(b) prevent or
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delay the consummation of any of the transactions contemplated by this
Agreement.
(d) Reliance by FelCor. Each Stockholder understands and
acknowledges that FelCor is entering into the Merger Agreement in reliance upon
the Stockholder's execution and delivery of this Agreement.
(e) Non-Interference. Such Stockholder will not, except as permitted
by this Agreement, (i) grant any proxies or powers of attorney with respect to
any of such Stockholder's Subject Shares, (ii) deposit any of such
Stockholder's Subject Shares into a voting trust or enter into a voting
agreement with respect to such Stockholder's Subject Shares, or (iii) take any
action that would make any representation or warranty contained herein untrue
or incorrect or have the effect of preventing such Stockholder from performing
its obligations under this Agreement.
(f) Survival. Each Stockholder's representations and warranties set
forth in this Section 5 will survive the Effective Time for one year after the
date of this Agreement.
6. Release. Effective without further action as of the Effective
Time, each Stockholder hereby releases any and all claims such Stockholder has
or may have against Bristol and Bristol's directors, officers and other
employees for all acts, actions, events or occurrences arising or occurring at
any time prior to and including the Effective Time that would give rise to a
claim for indemnification by such directors, officers or employees under the
Bristol Certificate, the Bristol Bylaws, any indemnification agreement for the
benefit of such persons, or Bristol's directors' and officers' insurance
policy; provided, however the foregoing release will not affect any
Stockholder's rights under any written agreement with Bristol.
7. Indemnification. FelCor hereby agrees to indemnify, defend and
hold harmless each Stockholder to the fullest extent permitted by law against
any and all judgments, fines, penalties and amounts paid in settlement
(including all interest, assessments and other charges paid or payable in
connection therewith) and all expenses (including without limitation attorneys'
fees), costs and obligations paid or incurred (a "Loss") in connection with
investigating, defending, participating in or preparing to defend any Claim
relating to, resulting from or arising out of the execution or delivery of this
Agreement or the consummation of the transactions contemplated hereby
(including without limitation the execution and delivery of the agreements
described in Sections 2 and 3 of this Agreement); provided however, the
foregoing indemnity will not include any Loss incurred by a Stockholder as a
result of any breach of a representation, warranty or covenant under this
Agreement. For purposes of this Agreement, "Claim" means any
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threatened, pending or completed action, suit or proceeding, or any inquiry or
investigation, whether instituted, made or conducted by the Company or any
other party, that any Stockholder determines might lead to the institution of
any such action, suit or proceeding, whether civil, criminal, administrative,
investigative or other.
8. Miscellaneous.
(a) Fees and Expenses. Each party hereto will pay its own expenses
incident to preparing for, entering into and carrying out this Agreement and
the performance of its obligations hereunder.
(b) Amendment. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
(c) Extension; Waiver. Any agreement on the part of a party to waive
any provision of this Agreement, or to extend the time for any performance
hereunder, will be valid against the other parties only if set forth in an
instrument in writing signed on behalf of each such party. The failure of any
party to this Agreement to assert any of its rights under this Agreement or
otherwise will not constitute a waiver of such rights.
(d) Entire Agreement; No Third-Party Beneficiaries. This Agreement
constitutes the entire agreement, and supersedes all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter of this Agreement, and is not intended to confer upon any person
other than the parties any rights or remedies.
(e) Governing Law. This Agreement will be governed by, and construed
in accordance with, the laws of the State of Delaware, regardless of the laws
that might otherwise govern under applicable conflict of laws principles
thereof.
(f) Notices. All notices, requests, claims, demands and other
communications under this Agreement must be in writing and will be deemed given
if delivered personally, or sent by overnight courier (providing proof of
delivery), in the case of the Stockholders, to the address set forth on
Schedule A hereto or, in the case of FelCor or Bristol, to the address set
forth below (or, in each case, at such other address as shall be specified by
like notice).
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(i) If to FelCor, to:
FelCor Suite Hotels, Inc.
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▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Attention: General Counsel
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with copy to:
Jenkens & ▇▇▇▇▇▇▇▇▇, P.C.
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) If to Bristol, to:
Bristol Hotel Company
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Attention: General Counsel
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
with copy to:
▇▇▇▇▇, Day, ▇▇▇▇▇▇ & ▇▇▇▇▇
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Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
(g) Assignment. Neither this Agreement nor any of the rights,
interest or obligations under this Agreement may be assigned or delegated, in
whole or in part, by operation of law or otherwise, by any Stockholder without
the prior written consent of FelCor and Bristol, and any such assignment or
delegation that is not consented to will be null and void. 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.
(h) 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,
and that such breach would cause the other parties hereto to sustain damages
for which they would not have an adequate remedy at law for money damages. It
is accordingly agreed that each party will be entitled to an
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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 Delaware or in any Delaware state court,
this being in addition to any other remedy to which it is entitled at law or in
equity. In addition, each of the parties hereto (a) consents to submit itself
to the personal jurisdiction of any federal court located in the State of
Delaware or in any Delaware state court in the event any dispute arises out of
this Agreement or any of the transactions contemplated by this Agreement and
(b) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such court. All
rights, powers and remedies provided under this Agreement or otherwise
available in respect hereof at law or in equity will be cumulative and not
alternative, and the exercise of any thereof by any party will not preclude the
simultaneous or later exercise of any other such right, power or remedy by such
party.
(i) Exclusive Remedy. If any Stockholder fails to perform any
covenant to be performed by it under this Agreement, and if, pursuant to
Section 7.2 of the Merger Agreement, the Break-Up Fee is paid to FelCor by
Bristol, such Break-Up Fee will constitute liquidated damages and will be
FelCor's sole and exclusive remedy for any breach by a Stockholder of any of
its representations, warranties or covenants under this Agreement.
(j) Severability. Any term or provision of this Agreement which is
invalid or unenforceable in any jurisdiction will, as to that jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms or
provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, the provisions will be
interpreted to be only so broad as is enforceable.
(k) WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT
TO A TRIAL BY JURY IN CONNECTION WITH ANY SUCH ACTION, SUIT OR PROCEEDING.
(l) Descriptive Headings. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of
or to affect the meaning or interpretation of this Agreement.
(m) Counterparts. This Agreement may be executed in one or more
counterparts, all of which will be considered one and the same agreement and
will become effective when one or more counterparts have been signed by each
party and delivered to the other parties.
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(n) Defined Terms. Capitalized terms used herein that are not
otherwise defined herein have the meanings set forth in the Merger Agreement.
[Signature page follows]
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement
to be signed as of the day and year first written above.
STOCKHOLDERS:
UNITED/▇▇▇▇▇▇ HOLDINGS, L.P.
By: Holdings Genpar, L.P.,
its General Partner
By: H H Genpar Partners,
its General Partner
By: Holdings Associates,
Inc., its Managing
General Partner
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Executive Vice
President
BASS AMERICA INC.
By: /s/ F. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
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Title: President
HOLIDAY CORPORATION
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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Title: Vice President/
Treasurer
The undersigned agrees to the
terms of Sections 2 and 4.
BASS PLC
By: /s/ ▇. ▇. ▇▇▇▇▇▇
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Title: General Counsel
and Secretary
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FELCOR SUITE HOTELS, INC.
By: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: Senior Vice
President
BRISTOL HOTEL COMPANY
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇
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Title: President and
Chief Executive Officer
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SCHEDULE A
Name and Address Number of Bristol Options to purchase
of Stockholder Common Shares Bristol Common Shares
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Holiday Corporation 3,586,929
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Attn: ▇▇▇▇▇ ▇. ▇▇▇▇
Bass America, Inc. 10,455,033
c/o Holiday Corporation
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Attn: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
United/▇▇▇▇▇▇ 12,716,986 1,342,791
Holdings, L.P.
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▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
