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Exhibit 2
AMENDMENT TO AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
This Amendment (the "AMENDMENT") is entered into as of the 16th day of
September, 1998, by and among SERVICO, INC., a Florida corporation ("Servico"),
LODGIAN, INC., a Delaware corporation and a wholly-owned subsidiary of Servico
("SHG"), SHG-S SUB, INC., a Florida corporation and a wholly-owned subsidiary of
SHG ("Servico Merger Sub"), IMPAC HOTEL GROUP, L.L.C., a Georgia limited
liability company ("Impac"), SHG-I SUB, L.L.C., a Georgia limited liability
company and a wholly-owned subsidiary of SHG ("Impac Merger Sub"), P-BURG
LODGING ASSOCIATES, INC., a Kentucky corporation ("P-Burg"), SHG-II SUB, INC., a
Kentucky corporation and a wholly-owned subsidiary of SHG ("P-Burg Merger Sub"),
HAZARD LODGING ASSOCIATES, INC., a Kentucky corporation ("Hazard"), SHG-III SUB,
INC., a Kentucky corporation and a wholly-owned subsidiary of SHG ("Hazard
Merger Sub"), MEMPHIS LODGING ASSOCIATES, INC., a Florida corporation
("Memphis"), SHG-IV SUB, INC., a Florida corporation and a wholly-owned
subsidiary of SHG ("Memphis Merger Sub"), XXXX LODGING ASSOCIATES, INC., a
Delaware corporation ("Xxxx"), SHG-V SUB, INC., a Delaware corporation and a
wholly-owned subsidiary of SHG ("Xxxx Merger Sub"), IMPAC HOTEL DEVELOPMENT,
INC., a Delaware corporation ("IHD"), SHG-VI SUB, INC., a Delaware corporation
and a wholly-owned subsidiary of SHG ("IHD Merger Sub"), IMPAC DESIGN AND
CONSTRUCTION, INC., a Delaware corporation ("IDC"), SHG-VII SUB, INC., a
Delaware corporation and a wholly-owned subsidiary of SHG ("IDC Merger Sub"),
IMPAC HOTEL GROUP, INC., a Florida corporation ("IHG"), SHG-VIII SUB, INC., a
Florida corporation and a wholly-owned subsidiary of SHG ("IHG Merger Sub"),
IHG, P-Burg, Hazard, Memphis, Xxxx, IHD and IDC are sometimes collectively
referred to as the "Impac Affiliated Companies", P-Burg Merger Sub, Hazard
Merger Sub, Memphis Merger Sub, Xxxx Merger Sub, IHD Merger Sub, IDC Merger Sub
and IHG Merger Sub, are sometimes collectively referred to as the "Impac
Affiliated Merger Subs".
PRELIMINARY STATEMENTS
WHEREAS, Servico, Impac, the Impac Affiliated Companies, Servico Merger
Sub, Impac Merger Sub and the Impac Affiliated Merger Subs entered into that
certain Amended and Restated Agreement and Plan of Merger, dated as of July 22,
1998 (the "AGREEMENT"), pursuant to which, among other things, Servico, Impac
and the Impac Affiliated Companies will combine their respective businesses in a
merger transaction (the "Merger"); and
WHEREAS, due to market conditions and the uncertainty created by the
recent volatility in Servico's common stock, the parties hereto have agreed to
fix the number of shares of SHG common stock which will be issued in the Merger;
and
WHEREAS, the parties hereto desire to amend the Agreement.
NOW, THEREFORE, in consideration of the premises and mutual terms,
covenants and agreements set forth herein and in the Agreement, and for other
good and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
1. AMENDMENT OF SECOND RECITAL. The parties agree that the second
recital of the Agreement is hereby deleted in its entirety and replaced with the
following:
WHEREAS, upon the terms and subject to the conditions of this
Agreement and in accordance with the Business Corporation Act of the
State of Florida (the "FBCA"), the Delaware General Corporation Law
("DGCL"), the Kentucky Business Corporation Act ("KBCA"), and the
Georgia Limited Liability Company Act (the "GLLCA"), SHG will acquire
all of the common stock of Servico and each
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of the Impac Affiliated Companies and all of the membership interests
of Impac through the merger of Servico Merger Sub with and into Servico
(the "Servico Merger"), the merger of P-Burg with and into P-Burg
Merger Sub (the "P-Burg Merger"), the merger of Hazard with and into
Hazard Merger Sub (the "Hazard Merger"), the merger of Memphis with and
into Memphis Merger Sub (the "Memphis Merger"), the merger of Xxxx with
and into Xxxx Merger Sub (the "Xxxx Merger"), the merger of IHD Merger
Sub with and into IHD (the "IHD Merger"), the merger of IDC with and
into IDC Merger Sub (the "IDC Merger"), and the merger of IHG with and
into IHG Merger Sub (the "IHG Merger", and, collectively with the
P-Burger Merger, the Hazard Merger, the Memphis Merger, the Xxxx
Merger, the IHD Merger and the IDC Merger, the "Impac Affiliated
Mergers"), and the merger of Impac with and into Impac Merger Sub (the
"Impac Merger") and the shareholders and members of Servico and Impac,
respectively, will receive shares of common stock, par value $.01 per
share, of SHG ("SHG Common Stock") as set forth herein;
2. AMENDMENT TO SECTION 1.2. The parties agree that Section 1.2 of the
Agreement is hereby deleted in its entirety and replaced with the following:
1.2 THE MERGERS.
(a) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the FBCA, at the
Effective Time (as defined herein), Servico Merger Sub shall be merged
with and into Servico. As a result of the Servico Merger, the separate
corporate existence of Servico Merger Sub shall cease and Servico shall
continue as the surviving corporation of the Servico Merger as a
wholly-owned subsidiary of SHG (the "Servico Surviving Corporation").
(b) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the KBCA, at the
Effective Time, P-Burg shall be merged with and into P-Burg Merger Sub.
As a result of the P-Burg Merger, the separate corporate existence of
P-Burg shall cease and P-Burg Merger Sub shall continue as the
surviving corporation of the P-Burg Merger as a wholly-owned subsidiary
of SHG (the "P-Burg Surviving Corporation"). If upon the advice of
counsel, it is determined that a merger of P-Burg Merger Sub with and
into P-Burg, with P-Burg as the survivor will qualify as a
reorganization within the meaning of Code Section 368(a)(1)(A) and
(a)(2)(E), then the parties may reverse the form of the P-Burg Merger
and P-Burg shall continue as the surviving corporation of the P-Burg
Merger as a wholly-owned subsidiary of SHG and be the "P-Burg Surviving
Corporation".
(c) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the KBCA, at the
Effective Time, Hazard shall be merged with and into Hazard Merger Sub.
As a result of the Hazard Merger, the separate corporate existence of
Hazard shall cease and Hazard Merger Sub shall continue as the
surviving corporation of the Hazard Merger as a wholly-owned subsidiary
of SHG (the "Hazard Surviving Corporation"). If upon the advice of
counsel, it is determined that a merger of Hazard Merger Sub with and
into Hazard, with Hazard as the survivor will qualify as a
reorganization within the meaning of Code Section 368(a)(1)(A) and
(a)(2)(E), then the parties may reverse the form of the Hazard Merger
and Hazard shall continue as the surviving
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corporation of the Hazard Merger as a wholly-owned subsidiary of SHG
and be the "Hazard Surviving Corporation".
(d) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the FBCA, at the
Effective Time, Memphis shall be merged with and into Memphis Merger
Sub. As a result of the Memphis Merger, the separate corporate
existence of Memphis shall cease and Memphis Merger Sub shall continue
as the surviving corporation of the Memphis Merger as a wholly-owned
subsidiary of SHG (the "Memphis Surviving Corporation"). If upon the
advice of counsel, it is determined that a merger of Memphis Merger Sub
with and into Memphis, with Memphis as the survivor will qualify as a
reorganization within the meaning of Code Section 368(a)(1)(A) and
(a)(2)(E), then the parties may reverse the form of the Memphis Merger
and Memphis shall continue as the surviving corporation of the Memphis
Merger as a wholly-owned subsidiary of SHG and be the "Memphis
Surviving Corporation".
(e) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the DGCL, at the
Effective Time, Xxxx shall be merged with and into Xxxx Merger Sub. As
a result of the Xxxx Merger, the separate corporate existence of Xxxx
shall cease and Xxxx Merger Sub shall continue as the surviving
corporation of the Xxxx Merger as a wholly-owned subsidiary of SHG (the
"Xxxx Surviving Corporation"). If upon the advice of counsel, it is
determined that a merger of Xxxx Merger Sub with and into Xxxx, with
Xxxx as the survivor will qualify as a reorganization within the
meaning of Code Section 368(a)(1)(A) and (a)(2)(E), then the parties
may reverse the form of the Xxxx Merger and Xxxx shall continue as the
surviving corporation of the Xxxx Merger as a wholly-owned subsidiary
of SHG and be the "Xxxx Surviving Corporation".
(f) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the DGCL, at the
Effective Time, IHD Merger Sub shall be merged with and into IHD. As a
result of the IHD Merger, the separate corporate existence of IHD
Merger Sub shall cease and IHD shall continue as the surviving
corporation of the IHD Merger as a wholly-owned subsidiary of SHG (the
"IHD Surviving Corporation").
(g) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the DGCL, at the
Effective Time, IDC shall be merged with and into IDC Merger Sub. As a
result of the IDC Merger, the separate corporate existence of IDC shall
cease and IDC Merger Sub shall continue as the surviving corporation of
the IDC Merger as a wholly-owned subsidiary of SHG (the "IDC Surviving
Corporation"). If upon the advice of counsel, it is determined that a
merger of IDC Merger Sub with and into IDC, with IDC as the survivor
will qualify as a reorganization within the meaning of Code Section
368(a)(1)(A) and (a)(2)(E), then the parties may reverse the form of
the IDC Merger and IDC shall continue as the surviving corporation of
the IDC Merger as a wholly-owned subsidiary of SHG and be the "IDC
Surviving Corporation".
(h) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the DGCL, at the
Effective Time, IHG shall be merged with and into IHG Merger Sub. As a
result of the IHG Merger, the separate corporate existence of IHG shall
cease and IHG Merger Sub shall continue
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as the surviving corporation of the IHG Merger as a wholly-owned
subsidiary of SHG (the "IHG Surviving Corporation"). If upon the advice
of counsel, it is determined that a merger of IHG Merger Sub with and
into IHG, with IHG as the survivor will qualify as a reorganization
within the meaning of Code Section 368(a)(1)(A) and (a)(2)(E), then the
parties may reverse the form of the IHG Merger and IHG shall continue
as the surviving corporation of the IHG Merger as a wholly-owned
subsidiary of SHG and be the "IHG Surviving Corporation".
(i) Upon the terms and subject to the conditions set
forth in this Agreement, and in accordance with the GLLCA, at the
Effective Time, Impac Merger Sub shall be merged with and into Impac.
As a result of the Impac Merger, the separate corporate existence of
Impac Merger Sub shall cease and Impac shall continue as the surviving
corporation of the Impac Merger as a wholly owned subsidiary of SHG
(the "Impac Surviving Corporation"; any of Servico Surviving
Corporation, P-Burg Surviving Corporation, Hazard Surviving
Corporation, Memphis Surviving Corporation, Xxxx Surviving Corporation,
IHD Surviving Corporation, IDC Surviving Corporation, IHG Surviving
Corporation, or Impac Surviving Corporation being separately referred
to as a "Surviving Corporation" and collectively referred to as the
"Surviving Corporations").
3. AMENDMENT TO SECTION 1.5. The parties agree that Section 1.5 of the
Agreement is hereby deleted in its entirety and replaced with the following:
1.5. EFFECT OF THE MERGERS. At the Effective Time, the effect
of the Servico Merger, the Memphis Merger and the IHG Merger shall be
as provided in the applicable provisions of the FBCA, the effect of the
P-Burg Merger and the Hazard Merger shall be as provided in the
applicable provisions of the KBCA, the effect of the Xxxx Merger, the
IHD Merger and the IDC Merger shall be as provided in the applicable
provisions of the DGCL, and the effect of the Impac Merger shall be as
provided in the applicable provisions of the GLLCA. Without limiting
the generality of the foregoing, and subject thereto, at the Effective
Time, except as otherwise provided herein, (a) all the property,
rights, privileges, powers and franchises of Servico and Servico Merger
Sub shall vest in Servico as the Servico Surviving Corporation, and all
debts, liabilities and duties of Servico and Servico Merger Sub shall
become the debts, liabilities and duties of Servico as the Servico
Surviving Corporation, (b) all the property, rights, privileges, powers
and franchises of P-Burg and P-Burg Merger Sub shall vest in P-Burg
Merger Sub as the P-Burg Surviving Corporation, and all debts,
liabilities and duties of P-Burg and P-Burg Merger Sub shall become the
debts, liabilities and duties of P-Burg Merger Sub as the P-Burg
Surviving Corporation, (c) all the property, rights, privileges, powers
and franchises of Hazard and Hazard Merger Sub shall vest in Hazard
Merger Sub as the Hazard Surviving Corporation, and all debts,
liabilities and duties of Hazard and Hazard Surviving Corporation shall
become the debts, liabilities and duties of Hazard Merger Sub as the
Hazard Surviving Corporation, (d) all the property, rights, privileges,
powers and franchises of Memphis and Memphis Merger Sub shall vest in
Memphis Merger Sub as the Memphis Surviving Corporation, and all debts,
liabilities and duties of Memphis and Memphis Merger Sub shall become
the debts, liabilities and duties of Memphis Merger Sub as the Memphis
Surviving Corporation, (e) all the property, rights, privileges, powers
and franchises of Xxxx and Xxxx Merger Sub shall vest in Xxxx Merger
Sub as the Xxxx Surviving Corporation, and all debts, liabilities and
duties of Xxxx and Xxxx Merger Sub shall become the debts, liabilities
and duties of Xxxx Merger Sub as the
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Xxxx Surviving Corporation, (f) all the property, rights, privileges,
powers and franchises of IHD and IHD Merger Sub shall vest in IHD as
the IHD Surviving Corporation, and all debts, liabilities and duties of
IHD and IHD Merger Sub shall become the debts, liabilities and duties
of IHD as the IHD Surviving Corporation, (g) all the property, rights,
privileges, powers and franchises of IDC and IDC Merger Sub shall vest
in IDC Merger Sub as the IDC Surviving Corporation, and all debts,
liabilities and duties of IDC and IDC Merger Sub shall become the
debts, liabilities and duties of IDC Merger Sub as the IDC Surviving
Corporation, (h) all the property, rights, privileges, powers and
franchises of IHG and IHG Merger Sub shall vest in IHG Merger Sub as
the IHG Surviving Corporation, and all debts, liabilities and duties of
IHD and IHD Merger Sub shall become the debts, liabilities and duties
of IHD Merger Sub as the IHD Surviving Corporation, and (i) all the
property, rights, privileges, powers and franchises of Impac and Impac
Merger Sub shall vest in Impac as the Impac Surviving Corporation, and
all debts, liabilities and duties of Impac and Impac Merger Sub shall
become the debts, liabilities and duties of Impac as the Impac
Surviving Corporation. As of the Effective Time, each of the Surviving
Corporations shall be a wholly-owned subsidiary of SHG.
4. AMENDMENT OF SECTION 2.2. The parties agree that Section 2.2 of the
Agreement is hereby deleted in its entirety and replaced with the following:
2.2 CONVERSION OF SHARES.
(a) Each share of Servico Common Stock issued and
outstanding immediately before the Effective Time (excluding those
owned by Impac or any wholly owned subsidiary of Servico or Impac) and
all rights in respect thereof, shall, at the Effective Time, without
any action on the part of any holder thereof, forthwith cease to exist
and be converted into and become exchangeable for 1.000 shares of SHG
Common Stock; such ratio of shares of Servico Common Stock to shares of
SHG Common Stock being referred to as the "Servico Exchange Ratio").
(b) Each share of P-Burg Common Stock, no par value
per share (the "P-Burg Common Stock"), issued and outstanding
immediately before the Effective Time and all rights in respect
thereof, shall, at the Effective Time, without any action on the part
of any holder thereof, forthwith cease to exist and be converted into
and become exchangeable for cash, without interest, and a number of
shares of SHG Common Stock as determined below (the ratio of shares of
P-Burg Common Stock to shares of SHG Common Stock being referred to as
the "P-Burg Exchange Ratio"). For purposes hereof, the P-Burg Exchange
Ratio shall be equal to the quotient of (i) the difference between
172,223.56 and 25,650.32 divided by (ii) the number of outstanding
shares of P-Burg Common Stock. The amount of cash which each share of
P-Burg Common Stock shall be converted into and exchangeable for shall
equal $274,824.86 divided by the number of outstanding shares of P-Burg
Common Stock.
(c) Each share of Hazard Common Stock, no par value
per share (the "Hazard Common Stock"), issued and outstanding
immediately before the Effective Time and all rights in respect
thereof, shall, at the Effective Time, without any action on the part
of any holder thereof, forthwith cease to exist and be converted into
and become exchangeable for cash, without interest, and a number of
shares of SHG Common Stock as determined below (the ratio of shares of
Hazard Common Stock to shares of SHG Common Stock being referred to as
the
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"Hazard Exchange Ratio"). For purposes hereof, the Hazard Exchange
Ratio shall be equal to the quotient of (i) the difference between
90,644.87 and 13,500.30 divided by (ii) the number of outstanding
shares of Hazard Common Stock. The amount of cash which each share of
Hazard Common Stock shall be converted into and exchangeable for shall
equal $144,646.07 divided by the number of outstanding shares of Hazard
Common Stock.
(d) Each share of Memphis Common Stock, par value
$.01 per share (the "Memphis Common Stock"), issued and outstanding
immediately before the Effective Time and all rights in respect
thereof, shall, at the Effective Time, without any action on the part
of any holder thereof, forthwith cease to exist and be converted into
and become exchangeable for cash, without interest, and a number of
shares of SHG Common Stock as determined below (the ratio of shares of
Memphis Common Stock to shares of SHG Common Stock being referred to as
the "Memphis Exchange Ratio"). For purposes hereof, the Memphis
Exchange Ratio shall be equal to the quotient of (i) the difference
between 124,972.73 and 18,612.96 divided by (ii) the number of
outstanding shares of Memphis Common Stock. The amount of cash which
each share of Memphis Common Stock shall be converted into and
exchangeable for shall equal $199,424.57 divided by the number of
outstanding shares of Memphis Common Stock.
(e) Each share of Xxxx Common Stock, no par value per
share (the "Xxxx Common Stock"), issued and outstanding immediately
before the Effective Time and all rights in respect thereof, shall, at
the Effective Time, without any action on the part of any holder
thereof, forthwith cease to exist and be converted into and become
exchangeable for cash, without interest, and a number of shares of SHG
Common Stock as determined below (the ratio of shares of Xxxx Common
Stock to shares of SHG Common Stock being referred to as the "Xxxx
Exchange Ratio"). For purposes hereof, the Xxxx Exchange Ratio shall be
equal to the quotient of (i) the difference between 59,699.73 and
8,891.45 divided by (ii) the number of outstanding shares of Xxxx
Common Stock. The amount of cash which each share of Xxxx Common Stock
shall be converted into and exchangeable for shall equal $95,265.53
divided by the number of outstanding shares of Xxxx Common Stock.
(f) Each share of IHD Common Stock, no par value per
share (the "IHD Common Stock"), issued and outstanding immediately
before the Effective Time and all rights in respect thereof, shall, at
the Effective Time, without any action on the part of any holder
thereof, forthwith cease to exist and be converted into and become
exchangeable for cash, without interest, and a number of shares of SHG
Common Stock as determined below (the ratio of shares of IHD Common
Stock to shares of SHG Common Stock being referred to as the "IHD
Exchange Ratio"). For purposes hereof, the IHD Exchange Ratio shall be
equal to the quotient of (i) the difference between 1,042,464.77 and
155,260.71 divided by (ii) the number of outstanding shares of IHD
Common Stock. The amount of cash which each share of IHD Common Stock
shall be converted into and exchangeable for shall equal $1,663,507.61
divided by the number of outstanding shares of IHD Common Stock.
(g) Each share of IDC Common Stock, no par value per
share (the "IDC Common Stock"), issued and outstanding immediately
before the Effective Time and all rights in respect thereof, shall, at
the Effective Time,
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without any action on the part of any holder thereof, forthwith cease
to exist and be converted into and become exchangeable for cash,
without interest, and a number of shares of SHG Common Stock as
determined below (the ratio of shares of IDC Common Stock to shares of
SHG Common Stock being referred to as the "IDC Exchange Ratio"). For
purposes hereof, the IDC Exchange Ratio shall be equal to the quotient
of (i) the difference between 60,815.31 and 9,057.60 divided by (ii)
the number of outstanding shares of IDC Common Stock. The amount of
cash which each share of IDC Common Stock shall be converted into and
exchangeable for shall equal $97,045.70 divided by the number of
outstanding shares of IDC Common Stock.
(h) Each share of IHG Common Stock, par value $1.00
per share (the "IHG Common Stock"), issued and outstanding immediately
before the Effective Time and all rights in respect thereof, shall, at
the Effective Time, without any action on the part of any holder
thereof, forthwith cease to exist and be converted into and become
exchangeable for cash, without interest, and a number of shares of SHG
Common Stock as determined below (the ratio of shares of IHG Common
Stock to shares of SHG Common Stock being referred to as the "IHG
Exchange Ratio"). For purposes hereof, the IHG Exchange Ratio shall be
equal to the quotient of (i) the difference between 101,358.86 and
15,096.00 divided by (ii) the number of outstanding shares of IHG
Common Stock. The amount of cash which each share of IHG Common Stock
shall be converted into and exchangeable for shall equal $161,742.86
divided by the number of outstanding shares of IHG Common Stock.
(i) Except as provided in Section 2.3(c) below, each
Class A Ordinary Membership Interest of Impac (an "Impac Unit") issued
and outstanding immediately before the Effective Time and all rights in
respect thereof, shall, at the Effective Time, without any action on
the part of any holder thereof, forthwith cease to exist and be
converted into and become exchangeable for cash, without interest, and
a number of shares of SHG Common Stock as determined below (the ratio
of shares of Impac Units to shares of SHG Common Stock being referred
to as the "Impac Exchange Ratio"). For purposes hereof, the Impac
Exchange Ratio shall be equal to the quotient of (i) the difference
between 7,747,820.17 and 1,153,930.66, divided by (ii) the number of
outstanding Impac Units minus the number of Impac Units owned by
P-Burg, Hazard, Delk, Memphis, IHD, IDC and IHG. The amount of cash
which each Impac Unit shall be converted into and exchangeable for
shall equal $12,363,542.80 divided by the number of outstanding Impac
Units minus the number of Impac Units owned by P-Burg, Hazard, Delk,
Memphis, IHD, IDC and IHG.
(j) Upon satisfaction of the conditions and
milestones set forth on SCHEDULE 2.2(c), an aggregate of an additional
1,400,000 shares of SHG Common Stock (the "Additional Shares") shall be
issuable to the holders of P-Burg Common Stock, Hazard Common Stock,
Memphis Common Stock, Xxxx Common Stock, IHD Common Stock, IDC Common
Stock, IHG Common Stock and Impac Units (collectively, the "Additional
Shareholders") in accordance with the methodology set forth on SCHEDULE
2.2(c). Certificates representing the Additional Shares shall be
delivered at the Closing to the Exchange Agent (as hereinafter
defined), as Escrow Agent, to be held and delivered to the Additional
Shareholders upon satisfaction of the conditions and milestones set
forth on SCHEDULE 2.2(c) in accordance with an Escrow Agreement
substantially in the form attached hereto as
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Exhibit 2.2(c). The Escrow Agreement will provide for the Additional
Shares to be released from escrow from time to time upon satisfaction
of such conditions and milestones (each of such milestone dates being
hereafter referred to as a "Milestone Date"). The parties agree and
acknowledge that the Additional Shares will be held in escrow pending
solely the satisfaction of the milestones and conditions set forth on
SCHEDULE 2.2(c) and any breach of any representation, warranty or
covenant by Impac contained in this Agreement will have no effect on
SHG's obligation to issue the Additional Shares to the Additional
Shareholders. The parties hereto hereby agree and acknowledge that the
parties have been advised that the Additional Shares will not be
treated as outstanding for purposes of calculating earnings per share
under applicable accounting rules and guidelines as applied by the SEC
or otherwise.
(k) At the Effective Time, each Class B Ordinary
Membership Interest of Impac shall be canceled and retired and no
shares of stock or other securities of SHG or either of the Surviving
Corporations or any other person shall be issuable, and no payment or
other calculation shall be made with respect thereto.
(l) Commencing immediately after the Effective Time,
each certificate which, immediately prior to the Effective Time,
represented issued and outstanding shares of Servico Common Stock
("Servico Shares"), P-Burg Common Stock ("P-Burg Shares"), Hazard
Common Stock ("Hazard Shares"), Memphis Common Stock ("Memphis
Shares"), Xxxx Common Stock ("Xxxx Shares"), IHD Common Stock ("IHD
Shares"), IDC Common Stock ("IDC Shares"), IHG Common Stock, ("IHG
Shares"), Impac Units (Impac Units, together with P-Burg Shares, Hazard
Shares, Memphis Shares, Xxxx Shares, IHD Shares, IDC Shares, IHG
Shares, and Servico Shares, the "Shares"), shall evidence ownership of
SHG Common Stock on the basis hereinbefore set forth, but subject to
the limitations set forth in Sections 2.3, 2.5, 2.7, 2.8 and 2.9
hereof.
(m) For all purposes of this Agreement, unless
otherwise specified, all shares held by employee benefit plans of
Servico (i) shall be deemed to be issued and outstanding, (ii) shall
not be deemed to be held in the treasury of Servico, and (iii) shall be
converted into shares of SHG Common Stock in accordance with the
Servico Exchange Ratio.
5. AMENDMENT OF SECTIONS 2.5 AND 2.6. The parties agree that Sections
2.5 and 2.6 of the Agreement shall be deleted in their entirety and replaced
with the following:
2.5 EXCHANGE OF SHARES OTHER THAN TREASURY SHARES. Subject to
the terms and conditions hereof, at or prior to the Effective Time, SHG
shall appoint an exchange agent to effect the exchange of Shares for
SHG Common Stock and cash in accordance with the provisions of this
Article II (the "Exchange Agent"). From time to time after the
Effective Time, SHG shall deposit, or cause to be deposited, cash and
certificates representing SHG Common Stock for conversion of Shares in
accordance with the provisions of Section 2.2 hereof (such cash and
certificates, together with any dividends or distributions with respect
thereto, being herein referred to as the "Exchange Fund"). Commencing
immediately after the Effective Time and until the appointment of the
Exchange Agent shall be terminated, each holder of a certificate or
certificates theretofore representing Shares may surrender the same to
the Exchange Agent, and, after the appointment of the Exchange Agent
shall be terminated, any such holder may surrender any
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such certificate to SHG. Such holder shall be entitled upon such
surrender to receive in exchange therefor (a) a certificate or
certificates representing the number of full shares of SHG Common Stock
into which the Shares theretofore represented by the certificate or
certificates so surrendered shall have been converted in accordance
with the provisions of Section 2.2 hereof, (b) cash which such holder
is entitled to receive in accordance with Section 2.2 hereof and (c)
cash in lieu of fractional shares, if any, in accordance with Section
2.7 hereof, and all such shares of SHG Common Stock shall be deemed to
have been issued at the Effective Time, it being agreed and
acknowledged, however, that the Additional Shares shall not be deemed
to be issued or outstanding until issuable on the applicable Milestone
Date in accordance with the provisions of SCHEDULE 2.2(c). The shares
of SHG Common Stock and cash described in the preceding sentence are
sometimes collectively referred to herein as the "Merger
Consideration." Until so surrendered and exchanged, each outstanding
certificate which, prior to the Effective Time, represented issued and
outstanding Shares shall be deemed for all corporate purposes of SHG,
other than the payment of dividends and other distributions, if any, to
evidence only the right to receive upon such surrender the Merger
Consideration. Unless and until any such certificate theretofore
representing Shares is so surrendered, no dividend or other
distribution, if any, payable to the holders of record of SHG Common
Stock as of any date subsequent to the Effective Time shall be paid to
the holder of such certificate in respect thereof. Upon the surrender
of any such certificate theretofore representing Shares, however, the
record holder of the certificate or certificates representing shares of
SHG Common Stock issued in exchange therefor shall receive from the
Exchange Agent or from SHG, as the case may be, payment of the amount
of dividends and other distributions, if any, which as of any date
subsequent to the Effective Time (or, with respect to the Additional
Shares, subsequent to the Milestone Date) and until such surrender
shall have become payable with respect to such number of shares of SHG
Common Stock ("Presurrender Dividends"). No interest shall be payable
with respect to the Merger Consideration or the payment of Presurrender
Dividends upon the surrender of certificates theretofore representing
Shares. After the appointment of the Exchange Agent shall have been
terminated, such holders of SHG Common Stock who have not received
payment of the Merger Consideration or the Presurrender Dividends shall
look only to SHG for payment thereof. Notwithstanding the foregoing
provisions of this Section 2.5, risk of loss and title to such
certificates representing Shares shall pass only upon proper delivery
of such certificates to the Exchange Agent, and neither the Exchange
Agent nor any party hereto shall be liable to a holder of Shares for
any SHG Common Stock, cash or dividends or distributions thereon
delivered to a public official pursuant to any applicable abandoned
property, escheat or similar law or to a transferee pursuant to Section
2.6 hereof.
2.6 STOCK TRANSFER BOOKS. At the Effective Time, the stock
transfer books of Servico with respect to Servico Shares, the stock
transfer books of P-Burg with respect to P-Burg Shares, the stock
transfer books of Hazard with respect to Hazard Shares, the stock
transfer books of Memphis with respect to Memphis Shares, the stock
transfer books of Xxxx with respect to Xxxx Shares, the stock transfer
books of IHD with respect to IHD Shares, the stock transfer books of
IDC with respect to IDC Shares, the stock transfer books of IHG with
respect to IHG Shares and the transfer books of Impac with respect to
Impac Units shall each be closed, and there shall be no further
registration of transfers of Shares thereafter on the records of any
such transfer books. In the event of a transfer of ownership
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10
of Shares that is not registered in the transfer records of Servico,
P-Burg, Hazard, Memphis, Xxxx, IHD, IDC, IHG or Impac, as the case may
be, at the Effective Time (a) a certificate or certificates
representing the number of full shares of SHG Common Stock into which
such Shares shall have been converted in accordance with Section 2.2
hereof, (b) cash into which such Shares shall have been converted in
accordance with Section 2.2 hereof and (c) cash in lieu of fractional
shares, if any, in accordance with Section 2.7 hereof, shall be issued
to the transferee, together with a cash payment in the amount of
Presurrender Dividends, if any, in accordance with Section 2.5 hereof,
if the certificate or certificates representing such Shares is or are
surrendered as provided in Section 2.5 hereof, accompanied by all
documents required to evidence and effect such transfer and by evidence
of payment of any applicable transfer tax.
6. AMENDMENT OF SECTION 2.7. The parties agree that Section 2.7 of the
Agreement shall be amended to add a new subsection (g) as follows:
(g) SHG shall be entitled to deduct and withhold from the
consideration otherwise payable pursuant to this Agreement to any
holder of Shares, such amounts as SHG is required to deduct and
withhold with respect to the making of such payment under the Code, or
any provision of state, local or foreign tax law. To the extent that
amounts are so withheld by SHG, such withheld amounts shall be treated
for all purposes of this Agreement as having been paid to the holder of
the Shares in respect of which such deduction and withholding was made
by SHG.
7. AMENDMENT TO SECTION 2.9(a). The parties agree that Section 2.9(a)
shall be amended to delete the reference to "shares of Servico Common Stock" and
replace it with "Impac Units".
8. AMENDMENT TO SECTION 5.14(b). The parties agree that the second
sentence of Section 5.14(b) of the Agreement shall be deleted in its entirety
and replaced with the following:
Further, SHG shall reserve for issuance under a stock option plan
approved by the Board of Directors of SHG, 555,000 shares of SHG Common
Stock, such options to be granted to certain employees of Impac or any
Impac Subsidiary.
9. AMENDMENT OF SECTION 7.2. The parties agree that Section 7.2 of the
Agreement shall be amended to delete Sections 7.2(g) and 7.2(h) in their
entirety and such sections shall be replaced with the following new Sections
7.2(g) and 7.2(h) and to add a new Section 7.2(i) as follows:
(g) DEBT RESTRUCTURING. Impac and Servico shall have received
(i) a commitment, effective as of the Closing, to restructure the
indebtedness of Impac and the Impac Subsidiaries substantially in
accordance with the terms described on Schedule 7.2(g) or (ii)
appropriate authorizations, consents, waivers or approvals permitting
the indebtedness of Impac and the Impac Subsidiaries to remain in place
after consummation of the transactions contemplated hereby on the same
economic terms as presently in effect, without the imposition of any
material adverse terms or conditions and without the imposition of any
significant costs provided, however, that if necessary in order to
obtain such authorizations, consents, waivers or approvals, Lodgian
will assume or be joined on any guaranty obligations of Impac (subject
to the terms, conditions and limitations thereof existing on the date
hereof) with respect to such indebtedness and will cause any affiliate
of Lodgian which replaces Impac Hotel Management LLC as manager of
Hotels owned or leased by the Impac Subsidiaries to subordinate its
interest in its management agreements to the obligations owed to the
existing lenders for such hotels.
(h) IMPAC AFFILIATED COMPANIES' FINANCIAL STATEMENTS. Servico
shall have received an audited balance sheet for each of the Impac
Affiliated Companies (other than IHD) as of December 31, 1997,
certified without qualification, by
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11
PricewaterhouseCoopers LLP, pursuant to their audit of the financial
records of such Impac Affiliated Companies and an unaudited balance
sheet for each of the Impac Affiliated Companies (other than IHD) as of
June 30, 1998, reviewed by PricewaterhouseCoopers LLP. Such balance
sheets shall present fairly, in all material respects, the financial
condition, assets, liabilities and equity of each of such Impac
Affiliated Companies at the address specified in those statements, and
shall reflect that none of such Impac Affiliated Companies have any
liabilities, commitments or obligations of any nature whatsoever,
whether accrued, contingent or otherwise.
(i) INDEMNIFICATION AGREEMENTS. SHG shall have received from
each of the shareholders of IHD an indemnification agreement, in form
and substance reasonably satisfactory to SHG and Servico, indemnifying
and holding each of the Indemnified Parties, SHG and its directors,
officers and agents harmless against any costs or expenses (including
attorneys' fees), judgments, fines, losses, claims, damages,
liabilities or amounts paid in settlement incurred in connection with
any claim, action, suit or proceeding or investigation, whether civil,
criminal, administrative or investigative relating to the conduct of
business, ownership of operation or IHD at or prior to the Effective
Time.
10. AMENDMENTS TO ELIMINATE REFERENCES TO IMPAC SPECIAL MEETING. The
parties agree and acknowledge that no Impac Special Meeting is being held and
that Impac has instead solicited consents to the approval of the Agreement and
the Mergers from its Members. Accordingly, all references to Impac Special
Meeting in the Agreement are hereby deleted.
11. EFFECT OF THIS AMENDMENT. The parties hereto agree and acknowledge
that except as specifically amended herein, the Agreement shall remain in full
force and effect and is hereby ratified and confirmed in all respects. The
execution, delivery and effectiveness of this Amendment shall not operate as a
waiver by any of the parties hereto of any other right or remedy any of them may
have pursuant to the Agreement. Without limiting the generality of the
foregoing, the parties reconfirm and agree that the representations, warranties,
covenants and agreements of the Agreement shall not be affected or diminished in
any way by any investigation (or failure to investigate) at any time by or on
behalf of Servico or by virtue of the execution of this Amendment. Additionally,
the parties acknowledge that the obligations of the parties to consummate the
transactions contemplated by the Agreement remain subject to the satisfaction of
all of the conditions precedent set forth in Article VI of the Agreement.
12. COUNTERPARTS. This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
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12
IN WITNESS WHEREOF, the parties hereto have each executed and
delivered this Amendment as of the day and year first above written.
SERVICO, INC., a Florida
corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President and Chief Executive Officer
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
LODGIAN, INC.,
a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Chief Executive Officer
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
IMPAC HOTEL GROUP, L.L.C.,
a Georgia limited liability company
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxxx X. Xxxx
Title: President and Manager
Address: 0000 Xxxxxxxxx Xxxx, X.X.
Xxxxx 0000
Xxxxxxx, Xxxxxxx 00000
SHG-S SUB, INC.,
a Florida corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
SHG-I SUB, L.L.C.,
a Georgia limited liability company
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: Manager
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
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13
P-BURG LODGING ASSOCIATES, INC.,
a Kentucky corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-II SUB, INC., a Kentucky corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
HAZARD LODGING ASSOCIATES, INC.,
a Kentucky corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-III SUB, INC., a Kentucky corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
MEMPHIS LODGING ASSOCIATES, INC.,
a Florida corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-IV SUB, INC., a Florida corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
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14
XXXX LODGING ASSOCIATES, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-V SUB, INC., a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx
IMPAC HOTEL DEVELOPMENT, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-VI SUB, INC., a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
IMPAC DESIGN AND
CONSTRUCTION, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-VII SUB, INC., a Delaware corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
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15
IMPAC HOTEL GROUP, INC.,
a Florida corporation
By: /s/ Xxxxxx X. Xxxx
--------------------------------------
Name:
Title:
Address:
SHG-VIII SUB, INC., a Florida corporation
By: /s/ Xxxxx X. Xxxxxxxxxx
--------------------------------------
Name: Xxxxx X. Xxxxxxxxxx
Title: President
Address: 0000 Xxxxxxxxx Xxxx
Xxxx Xxxx Xxxxx, XX 00000
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