EXHIBIT 5
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of February
28, 2000, by and among Bristol Hotels & Resorts, a Delaware corporation (the
"Company"), Bass PLC, a corporation organized under the laws of England and
Wales ("Parent"), and BHR North America, Inc., a Delaware corporation and an
indirect, wholly owned subsidiary of Parent ("Purchaser").
RECITALS
A. The Boards of Directors of each of Parent, Purchaser and the
Company have determined that it is in the best interests of their respective
companies and stockholders for Purchaser to enter into a business combination
with the Company on the terms and subject to the conditions set forth herein
(the "Acquisition").
B. As a first step in the Acquisition, the Company, Parent and
Purchaser each desire that Parent cause Purchaser to commence a cash tender
offer (the "Offer") to purchase all of the Company's issued and outstanding
shares (the "Shares") of common stock, par value $0.01 per share (the "Common
Stock"), for $9.50 per Share, net to the seller in cash, without interest or
such higher price as may be paid in the Offer (the "Per Share Amount"), on the
terms and subject to the conditions set forth in this Agreement.
C. To complete the Acquisition, the Boards of Directors of each of the
Company, Parent and Purchaser have approved this Agreement and the merger of
the Purchaser with and into the Company (the "Merger"), wherein any issued and
outstanding Shares not tendered and purchased by Purchaser pursuant to the
Offer (other than Shares described in Section 2.6(b) and any Dissenting Shares)
will be converted into the right to receive the Per Share Amount, on the terms
and subject to the conditions of this Agreement and in accordance with the
Delaware General Corporation Law (the "DGCL").
D. The Board of Directors of the Company (the "Company Board") (i) has
unanimously resolved (one director abstaining) to recommend that the holders of
the Shares ("Stockholders") accept the Offer and approve the Merger and adopt
this Agreement and (ii) has determined that the consideration to be paid for
each Share in the Offer and the Merger is fair to and in the best interests of
the Stockholders.
E. The parties desire to make certain representations, warranties and
covenants in connection with the Offer and the Merger and also to prescribe
various conditions to the Offer and the Merger.
F. In order to induce Parent and Purchaser to enter into this
Agreement, concurrently with the execution and delivery hereof, Parent,
Purchaser and United/Xxxxxx Holdings, L.P., a Delaware limited partnership
("Holdings"), are entering into a Stockholder Agreement, dated as of the date
hereof (the "Stockholder Agreement"), pursuant to which Holdings has agreed, on
the terms and subject to the conditions thereof, to tender its Shares in
accordance with the terms of the Offer and to vote its Shares in favor of the
Merger and other matters necessary to consummate the transactions contemplated
by this Agreement.
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NOW THEREFORE, in consideration of the representations, warranties and
covenants contained in this Agreement, the parties agree as follows:
I. THE TENDER OFFER
1.1 The Offer. (a) Provided that nothing shall have occurred that, had
the Offer referred to below been commenced, would give rise to a right to
terminate the Offer pursuant to any of the conditions set forth in Annex A
hereto, subject to the last sentence of this Section 1.1(a), as promptly as
practicable (but in any event not later than March 6, 2000), Parent will cause
Purchaser to commence (within the meaning of Rule 14d-2 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act")), the Offer, whereby
Purchaser will offer to purchase for cash all of the Shares at the Per Share
Amount, net to the seller in cash, without interest (subject to reduction for
any stock transfer taxes payable by the seller, if payment is to be made to a
Person other than the Person in whose name the certificate for such Shares is
registered, or for any applicable withholding tax), provided, however, that
Parent may designate another direct or indirect subsidiary of Parent as the
bidder in the Offer (within the meaning of Rule 14d-1(g) under the Exchange
Act, in which case references herein to Purchaser will be deemed to apply to
such subsidiary, as applicable). The obligation of Parent to cause Purchaser to
consummate the Offer and to accept for payment and to promptly pay for Shares
validly tendered in the Offer and not validly withdrawn in accordance therewith
will be subject to, and only to, those conditions set forth in Annex A hereto
(the "Offer Conditions").
(b) Subject to the requirements of applicable Law, Purchaser expressly
reserves the right to waive any of the conditions to the Offer and to make any
changes in the terms or conditions of the Offer; provided, however that without
the prior written consent of the Company, Purchaser will not, and Parent will
cause Purchaser not to, (i) decrease or change the form of the Per Share
Amount, (ii) decrease the number of Shares sought in the Offer, or (iii) amend
or waive the Minimum Condition (as defined in Annex A hereto) or impose
conditions other than the Offer Conditions on the Offer. In the event that any
Offer Condition is not satisfied or waived at the time that the expiration date
of the Offer (as such date may from time to time be extended, the "Expiration
Date") would otherwise occur, Purchaser may from time to time extend the
Expiration Date (but not beyond the Outside Date), or amend any term of the
Offer in any manner not materially adverse to the Stockholders. In the event
that at least a majority but less than 90% of the Voting Securities, calculated
on a fully diluted basis, have been validly tendered and not withdrawn on the
scheduled or extended expiration date of the Offer, Purchaser shall, unless
otherwise notified by the Company in writing, accept and purchase all of the
Shares tendered in the initial offer period and may notify Stockholders of
Purchaser's intent to provide a "subsequent offering period" for tender of at
least 90% of the Shares pursuant to Rule 14d-11 of the Exchange Act. The Offer
may be extended in connection with an increase in the consideration to be paid
pursuant to the Offer so as to comply with applicable rules and regulations of
the Securities and Exchange Commission (the "SEC"). Assuming the prior
satisfaction or waiver of the Offer Conditions, Parent will cause Purchaser to
accept for payment, and pay for, in accordance with the terms of the Offer, all
Shares validly tendered and not withdrawn pursuant to the Offer as soon as
practicable after the Expiration Date or any extension thereof.
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1.2 Offer Documents. (a) As soon as practicable on the date of the
public announcement of the Offer, Parent and Purchaser will file or cause to be
filed with the SEC the joint press release announcing the Offer on Schedule TO
("Schedule TO"), and as soon as practical on the date of commencement of the
Offer, Parent and Purchaser will file or cause to be filed with the SEC a
tender offer statement on Schedule TO which will contain an offer to purchase
and related letter of transmittal and other ancillary Offer documents and
instruments pursuant to which the Offer will be made (collectively with any
supplements or amendments thereto or any other documents filed by Parent or
Purchaser with the SEC with respect to the Offer pursuant to Rule 13e-3 of the
Exchange Act, the "Offer Documents") and which Parent and Purchaser represent,
warrant and covenant will comply in all material respects with the Exchange Act
and other applicable Laws and will contain (or will be amended in a timely
manner so as to contain) all information which is required to be included
therein in accordance with the Exchange Act and the rules and regulations
thereunder and other applicable Laws; provided, however, that no
representation, warranty or covenant is hereby made or will be made by Parent
or Purchaser with respect to information supplied by the Company or any of its
officers, directors, employees, representatives or agents for inclusion in, or
information derived from the Company's public SEC filings that is incorporated
by reference or included in, the Offer Documents (such supplied, derived,
incorporated or included information, the "Company SEC Information")
(b) Parent, Purchaser and the Company will each promptly correct any
information provided by them for use in the Offer Documents if and to the
extent that it becomes false or misleading in any material respect, and Parent
and Purchaser will jointly and severally take all lawful action necessary to
cause the Offer Documents as so corrected to be filed promptly with the SEC and
to be disseminated to the Stockholders, in each case as and to the extent
required by applicable Law. In conducting the Offer, Parent and Purchaser will
comply in all material respects with the provisions of the Exchange Act and
other applicable Laws. Parent and Purchaser will afford the Company and its
counsel a reasonable opportunity to review and comment on the Offer Documents
and any amendments thereto prior to the filing thereof with the SEC.
1.3 Company Actions. The Company hereby approves of and consents to
the Offer and represents that (a) the Company Board (at a meeting duly called
and held) has (i) determined that this Agreement, the Offer and the Merger are
fair to and in the best interests of the Company and its Stockholders, (ii)
approved this Agreement and the transactions contemplated hereby, including the
Offer and the Merger, (iii) taken all other action necessary to render the
limitations on business combinations contained in Section 203 of the DGCL (or
any similar provision) inapplicable to the transactions contemplated hereby,
including the Offer and the Merger, (iv) taken all action necessary to exempt
Parent and its direct and indirect wholly owned subsidiaries from the
limitations on ownership of voting stock of the Company set forth in Article
Seventh of the Company's Amended and Restated Certificate of Incorporation, (v)
consented to the acquisition by Purchaser and its direct and indirect wholly
owned subsidiaries of Shares pursuant to the Offer for purposes of Section 4.2
of the Stockholders' Agreement, dated July 27, 1998 (the "BHR Stockholders
Agreement"), by and among the Company, Holiday Corporation, Bass America, Inc.,
Parent and Holdings; and (vi) resolved to recommend acceptance of the Offer and
approval of the Merger by the Stockholders and adoption of this Agreement by
the Stockholders and (b) Prudential Securities Incorporated (the "Company
Financial Adviser") has
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delivered to the Company Board the opinion described in Section 3.18. The
Company hereby consents to the inclusion in the Offer Documents of the
recommendation referred to in this Section 1.3; provided, however, that the
Company Board may withdraw, modify or change such recommendation to the extent,
and only to the extent and on the conditions, specified in Section 5.2(b). The
Company will file with the SEC, substantially simultaneously with the filing by
Parent and Purchaser of the Schedule TO, the joint press release announcing the
Offer on Schedule 14D-9 and a Solicitation/Recommendation Statement containing
such recommendations of the Company Board in favor of the Offer and the Merger
(together with all amendments and supplements thereto, "Schedule 14D-9"). The
Company represents, warrants and covenants to Parent and Purchaser that
Schedule 14D-9 will comply in all material respects with the Exchange Act and
any other applicable Laws and will contain (or will be amended in a timely
manner so as to contain) all information that is required to be included
therein in accordance with the Exchange Act and the rules and regulations
thereunder and other applicable Laws; provided, however, that no
representation, warranty or covenant is made or will be made herein by the
Company with respect to information supplied by Parent or Purchaser or any of
their respective officers, directors, employees, representatives or agents for
inclusion in, or information derived from Parent's public SEC filings which is
incorporated or included in, Schedule 14D-9 (the "Parent SEC Information"). The
Company will include in Schedule 14D-9 information furnished by Parent in
writing concerning Parent's Designees as required by Section 14(f) of the
Exchange Act and Rule 14f-1 thereunder and will use its reasonable best efforts
to have Schedule 14D-9 available for inclusion in the initial mailing (and any
subsequent mailing) of the Offer Documents to the Stockholders. Each of the
Company and Parent will promptly correct any information provided by it for use
in Schedule 14D-9 if and to the extent that it becomes false or misleading in
any material respect and the Company will further take all lawful action
necessary to cause Schedule 14D-9 as so corrected to be filed promptly with the
SEC and disseminated to the Stockholders, in each case as and to the extent
required by applicable Law. Parent and its counsel will be given a reasonable
opportunity to review Schedule 14D-9 and any amendments thereto prior to the
filing thereof with the SEC. In connection with the Offer, the Company will
furnish Parent with mailing labels, security position listings and all
available listings or computer files containing the names and addresses of the
record Stockholders as of the latest practicable date and thereafter, until the
expiration of the Offer, of those persons becoming Stockholders subsequent to
such latest practicable date, and will furnish Parent such information and
assistance (including updated lists of Stockholders, mailing labels and lists
of security positions) as Parent or its agents may reasonably request in
communicating the Offer to the record and beneficial Stockholders. Subject to
the requirements of applicable Law, and except for such actions as are
necessary to disseminate the Offer Documents and any other documents necessary
to consummate the Offer and the Merger, Parent and Purchaser will, and will
instruct each of their respective Affiliates, associates, partners, employees,
directors, officers, agents, and advisors to, hold in confidence the
information contained in such labels, lists and files, will use such
information only in connection with the Offer and the Merger, and, if this
Agreement is terminated in accordance with its terms, will deliver promptly to
the Company all copies of such information (and any copies, compilations or
extracts thereof or based thereon) then in their possession or under their
control or in the possession or under the control of their affiliates, agents
or representatives.
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1.4 Actions by Parent and Purchaser. Subject to the provisions of this
Agreement, Parent shall provide or cause to be provided to Purchaser all of the
funds necessary to purchase any Shares that Purchaser becomes obligated to
purchase pursuant to the Offer at such time as such funds are necessary.
1.5 Directors. (a) Promptly upon the purchase of Shares pursuant to
the Offer, and from time to time thereafter, (i) Parent will be entitled to
designate such number of directors ("Parent's Designees"), rounded up to the
next whole number, as will give Parent, subject to compliance with Section
14(f) of the Exchange Act, representation on the Company Board equal to the
product of (A) the number of directors on the Company Board (giving effect to
any increase in the number of directors pursuant to this Section 1.5) and (B)
the percentage that such number of Shares so purchased bears to the aggregate
number of Shares outstanding (such number being, the "Board Percentage");
provided, however, that if the number of Shares purchased pursuant to the Offer
equals or exceeds a majority of the outstanding Shares, the Board Percentage
will in all events be a majority of the members of the Company Board, and (ii)
the Company will, upon request by Parent, promptly satisfy the Board Percentage
by (A) increasing the size of the Company Board or (B) using its reasonable
best efforts to secure the resignations of such number of directors as is
necessary to enable Parent's Designees to be elected to the Company Board, or
both, and will use its reasonable best efforts to cause Parent's Designees
promptly to be so elected, subject in all instances to compliance with Section
14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder. Promptly after
the date hereof, Parent shall provide to the Company the names of its designees
for election to the Company Board and all other information relating to such
designees necessary for the Company to comply with Section 14(f) of the
Exchange Act and Rule 14f-1 promulgated thereunder. At the request of Parent,
upon the purchase of Shares pursuant to the Offer, the Company will use its
reasonable best efforts to cause such individuals designated by the Parent to
constitute the same Board Percentage of (i) each committee of the Company
Board, (ii) the Company's representation on the board of directors of any
Subsidiary (as defined below) of the Company, and (iii) the Company's
representation on any committee of the board of directors of any Subsidiary of
the Company. At the request of Parent, the Company will take, at its expense,
all reasonable action necessary to effect any such election. Parent will supply
to the Company in writing and be solely responsible for any information with
respect to itself, Parent's Designees and Parent's officers, directors and
Affiliates required by Section 14(f) of the Exchange Act and Rule 14f-1
promulgated thereunder to be included in Schedule 14D-9. Notwithstanding the
foregoing, at all times prior to the Effective Time, the Company Board will
include at least two Continuing Directors as defined in Section 1.5(b) below.
(b) Notwithstanding any other provision hereof, of the certificate of
incorporation or bylaws of the Company or of applicable Law to the contrary,
following the election or appointment of Parent's Designees pursuant to this
Section 1.5 and prior to the Effective Time, any amendment or termination of
this Agreement by the Company or amendment of the certificate of incorporation
or bylaws of the Company, extension by the Company for the performance or
waiver of the obligations or other acts of Parent or Purchaser hereunder or
waiver by the Company of any of the Company's rights hereunder will require the
affirmative vote of the majority of the Continuing Directors. For purposes of
this Agreement, the term the "Continuing Directors" means at any time (i) those
directors of the
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Company who are directors on the date hereof and who voted to approve this
Agreement and (ii) such additional directors of the Company who are not
affiliated with Parent, Purchaser or any of their respective Affiliates and who
are designated as "Continuing Directors" for purposes of this Agreement by a
majority of the Continuing Directors in office at the time of such designation.
II. THE MERGER
2.1 The Merger. (a) On the terms and subject to the conditions of this
Agreement, at the Effective Time, Purchaser will be merged with and into the
Company in accordance with the applicable provisions of the DGCL, and the
separate corporate existence of Purchaser will thereupon cease. The Company
will be the surviving corporation in the Merger (as such, the "Surviving
Corporation") in accordance with the DGCL.
(b) The Merger will have the effects specified in the applicable
provisions of the DGCL. Without limiting the generality of the foregoing, and
subject thereto, at the Effective Time all the properties, rights, privileges,
powers and franchises of the Company and Purchaser shall vest in the Surviving
Corporation and all debts, liabilities and duties of the Company and Purchaser
shall become the debts, liabilities and duties of the Surviving Corporation.
2.2 Closing. The closing of the transactions contemplated by this
Agreement (the "Closing") will take place at the offices of Xxxxx, Day, Xxxxxx
& Xxxxx, 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, at 10:00 a.m., local time,
on the second Business Day after the date on which the last of the conditions
(excluding conditions that by their terms cannot be satisfied until the Closing
Date) set forth in Article VI is satisfied or waived in accordance herewith, or
at such other place, time or date as the parties may agree. The date on which
the Closing occurs is hereinafter referred to as the "Closing Date."
2.3 Effective Time. On the Closing Date or as soon as practicable
following the date on which the last of the conditions set forth in Article VI
is satisfied or waived in accordance herewith, the Surviving Corporation will
cause a certificate of merger to be filed with the Secretary of State of the
State of Delaware as provided in the applicable section of the DGCL. Upon
completion of such filing or at such date or time as Parent and the Company
agree and specify in the certificate of merger, the Merger will become
effective in accordance with the DGCL. The time and date on which the Merger
becomes effective is herein referred to as the "Effective Time".
2.4 Certificate of Incorporation and Bylaws of the Surviving
Corporation. (a) The certificate of incorporation of the Surviving Corporation
will be amended as of the Effective Time to conform to the certificate of
incorporation of the Purchaser in effect immediately prior to the Effective
Time, until thereafter amended in accordance with its terms and those of the
DGCL.
(b) The bylaws of the Purchaser will be the bylaws of the Surviving
Corporation from and after the Effective Time, until amended in accordance with
their terms, the certificate of incorporation of the Surviving Corporation and
the DGCL.
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2.5 Directors and Officers of the Surviving Corporation. (a) The
members of the initial Board of Directors of the Surviving Corporation will be
the directors of the Purchaser at the Effective Time. All of the members of the
Board of Directors of the Surviving Corporation will serve until their
successors are duly elected or appointed and qualified or until their earlier
death, resignation or removal in accordance with the certificate of
incorporation and the bylaws of the Surviving Corporation.
(b) The officers of the Surviving Corporation will consist of the
officers of the Company at the Effective Time. Such Persons will continue as
officers of the Surviving Corporation until their successors have been duly
elected or appointed and qualified or until their earlier death, resignation or
removal in accordance with the certificate of incorporation and the bylaws of
the Surviving Corporation.
2.6 Conversion of Securities. At the Effective Time, by virtue of the
Merger and without any action on the part of Parent, Purchaser, the Company or
the holder of any of the following securities:
(a) Conversion of Shares. Each Share issued and outstanding
immediately prior to the Effective Time (other than any Shares subject to
Section 2.6(b) and any Dissenting Shares) and any Shares issuable upon exercise
of any option, conversion or other right to acquire Shares existing immediately
prior to the Effective Time (collectively, "Rights") will, by virtue of the
Merger and without any action on the part of the holder thereof, be canceled
and extinguished and be converted into the right to receive (i) in the case of
Shares, the Per Share Amount, or such higher per Share amount as is paid in the
Offer, in cash payable to the holder thereof, without interest (the "Merger
Consideration"), or (ii) in the case of Rights, the excess, if any, of the Per
Share Amount (or such higher per Share amount as is paid in the Offer) over the
per Share exercise price thereof, in each case prorated for fractional shares,
in accordance with Section 2.7. All such Shares, when so converted, will no
longer be outstanding and will automatically be canceled and retired and will
cease to exist, and each holder of a certificate formerly representing any such
Share will cease to have any rights with respect thereto, except the right to
receive the Merger Consideration therefor upon the surrender of such
certificate in accordance with Section 2.7. Any payment made pursuant to this
Section 2.6(a) and Section 2.7 will be made net of applicable withholding taxes
to the extent such withholding is required by Law. Notwithstanding the
foregoing, if between the date of this Agreement and the Effective Time the
outstanding Shares shall have been changed into a different number of shares or
a different class, by reason of any stock dividend, subdivision,
reclassification, recapitalization, split, combination or exchange of shares,
and such action is in compliance with Section 5.1, the Merger Consideration
will be correspondingly adjusted on a per-share basis to reflect such stock
dividend, subdivision, reclassification, recapitalization, split, combination
or exchange of shares.
(b) Cancellation of Treasury Shares and Parent-Owned Shares. Each
Share held in the treasury of the Company and each Share owned by Purchaser
immediately before the Effective Time will be automatically canceled and
retired and will cease to exist and no payment or other consideration will be
made with respect thereto. Notwithstanding anything herein to the contrary,
each Share owned by Bass America, Inc. or Parent or any direct or indirect,
wholly-owned
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subsidiary of Parent (other than Purchaser) immediately before the Effective
Time shall not be cancelled, and shall be converted into and become one validly
issued, fully paid and nonassessable share of common stock, par value $0.01 per
share, of the Surviving Corporation ("Surviving Corporation Common Stock").
(c) Common Stock of Purchaser. Each share of common stock, par value
$0.01 per share, of Purchaser issued and outstanding immediately before the
Effective Time will be converted into and become one validly issued, fully paid
and nonassessable share of Surviving Corporation Common Stock, which, in
accordance with this Agreement and together with the Surviving Corporation
Common Stock issued pursuant to the last sentence of Section 2.6(b), will
constitute all of the issued and outstanding shares of capital stock of the
Surviving Corporation immediately after the Effective Time.
2.7 Surrender of Shares; Stock Transfer Books. (a) Prior to the
Effective Time, Purchaser will designate a bank or trust company selected by it
and reasonably acceptable to the Company to act as agent for the Stockholders
in connection with the Merger (the "Paying Agent") to receive the funds
necessary to make the payments contemplated by Section 2.6. As soon as
practicable after the Effective Time, Parent shall deposit or cause to be
deposited with the Paying Agent for the benefit of Stockholders the aggregate
consideration to which such holders will be entitled pursuant to Section
2.6(a). Such funds shall be invested by the Paying Agent as directed by the
Surviving Corporation.
(b) Each holder of a certificate or certificates representing any
Shares canceled upon the Merger pursuant to Section 2.6(a) (the "Certificates")
may thereafter surrender such Certificate or Certificates to the Paying Agent,
as agent for such holder, to effect the surrender of such Certificate or
Certificates on such holder's behalf for a period ending six months after the
Effective Time. Parent agrees that promptly after the Effective Time it will
cause the distribution to Stockholders of record as of the Effective Time of
appropriate materials to facilitate such surrender. Upon the surrender of
Certificates for cancellation, together with such materials, Parent will cause
the Paying Agent to pay the holder of such Certificates in exchange therefor
cash in an amount equal to the Merger Consideration multiplied by the number of
Shares represented by such Certificate. Until so surrendered, each such
Certificate (other than certificates representing Shares subject to Section
2.6(b) and any Dissenting Shares) will represent solely the right to receive
the aggregate Merger Consideration relating thereto.
(c) If payment of cash in respect of canceled Shares is to be made to
a Person other than the Person in whose name a surrendered Certificate or
instrument is registered, it will be a condition to such payment that the
Certificate or instrument so surrendered shall be properly endorsed or shall be
otherwise in proper form for transfer and that the Person requesting such
payment shall have paid any transfer and other taxes required by reason of such
payment in a name other than that of the registered holder of the Certificate
or instrument surrendered or shall have established to the satisfaction of the
Surviving Corporation or the Paying Agent that such tax either has been paid or
is not payable.
(d) At the Effective Time, the stock transfer books of the Company
will be closed and there will not be any further registration of transfers of
Shares outstanding prior to the Effective Time or otherwise issuable pursuant
to Rights on the records of the Company. If, after the Effective Time,
Certificates are
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presented to the Surviving Corporation, they will be canceled and exchanged for
the Merger Consideration as provided in Section 2.6(a). No interest will accrue
or be paid on any cash payable upon the surrender of a Certificate or
Certificates which immediately before the Effective Time represented
outstanding Shares or Shares issuable upon exercise of Rights.
(e) Promptly following the date that is six months after the Effective
Time, the Paying Agent will deliver to the Surviving Corporation all cash,
certificates and other documents in its possession relating to the transactions
contemplated hereby, and the Paying Agent's duties will terminate. Thereafter,
each holder of a Certificate (other than Certificates representing Shares
subject to Section 2.6(b) and any Dissenting Shares) may surrender such
Certificate to the Surviving Corporation and (subject to applicable abandoned
property, escheat and similar Laws) receive in consideration thereof the
aggregate Merger Consideration relating thereto, without any interest or
dividends thereon.
(f) The Merger Consideration will be net to the holder of Shares in
cash, subject to reduction only for any applicable withholding taxes or, as set
forth in Section 2.7(c), stock transfer taxes payable by such holder.
(g) In the event any Certificate has been lost, stolen or destroyed,
upon the making of an affidavit of that fact by the Person claiming such
Certificate to be lost, stolen or destroyed, the Paying Agent will issue in
exchange for such lost, stolen or destroyed Certificate the Merger
Consideration deliverable in respect thereof as determined in accordance with
Section 2.6; provided, that the Person to whom the Merger Consideration is paid
shall, as a condition precedent to the payment thereof, post a bond in such
reasonable amount as the Surviving Corporation may direct or otherwise
indemnify the Surviving Corporation in a manner reasonably satisfactory to it
against any claim that may be made against the Surviving Corporation with
respect to the Certificate claimed to have been lost, stolen or destroyed.
(h) None of the Parent, Purchaser, the Company, the Surviving
Corporation, the Paying Agent or any other person shall be liable to any former
holder of Shares for any amount properly delivered to a public official
pursuant to applicable abandoned property, escheat or similar laws.
2.8. Dissenting Shares. (a) Notwithstanding any provision of this
Agreement to the contrary, any Shares held by a holder who has not voted such
Shares in favor of this Agreement and who has properly exercised appraisal
rights with respect to such Shares in accordance with the DGCL (including
Section 262 thereof) and as of the Effective Time has neither effectively
withdrawn nor lost its right to exercise such appraisal rights ("Dissenting
Shares"), will not be converted into or represent a right to receive the Merger
Consideration pursuant to Section 2.6(a), but the holder thereof will be
entitled to only such rights as are granted by the DGCL.
(b) Notwithstanding the provisions of Section 2.8(a), if any
Stockholder who demands appraisal rights with respect to its Shares under the
DGCL effectively withdraws or loses (through failure to perfect or otherwise)
its appraisal rights, then as of the Effective Time or the occurrence of such
event, whichever later occurs, such holder's Shares will automatically be
converted into and represent only the right to receive the Merger Consideration
as provided in
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Section 2.6(a), without interest thereon, upon surrender of the Certificate or
Certificates formerly representing such Shares.
(c) The Company will give Parent (i) prompt notice of any written
intent to demand payment of the fair value of any Shares, withdrawals of such
demands and any other instruments served pursuant to the DGCL received by the
Company and (ii) the opportunity to direct all negotiations and proceedings
with respect to appraisal rights under the DGCL. The Company may not
voluntarily make any payment with respect to any exercise of appraisal rights
and may not, except with the prior written consent of Parent, settle or offer
to settle any such appraisal rights.
III. REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to each of Parent and
Purchaser, except as set forth in the letter, dated the date hereof, from the
Company to Parent and Purchaser (the "Company Disclosure Letter"), as follows:
3.1. Existence; Good Standing; Corporate Authority. The Company is a
corporation duly incorporated, validly existing and in good standing under the
laws of the State of Delaware. The Company is duly licensed or qualified to do
business as a foreign corporation and is in good standing under the laws of
each state in which the character of the properties owned or leased by it or in
which the transaction of its business makes such qualification necessary,
except where the failure to be so qualified or to be in good standing would not
reasonably be expected to have a Company Material Adverse Effect. The Company
has all requisite corporate power and authority to own, operate and lease its
properties and carry on its business as now conducted. The copies of the
Company's certificate of incorporation and bylaws previously made available to
Parent are true, correct and complete. As used in this Agreement, (a) the term
"Company Material Adverse Effect" means any change, effect, event or condition
that has had or would reasonably be expected to (i) have a material adverse
effect on the business, results of operations or financial condition of the
Company and its Subsidiaries, taken as a whole, other than any change, effect,
event or condition resulting from factors generally affecting the U.S.
hospitality industry or the United States economy, or (ii) prevent or
materially delay the Company's ability to consummate the transactions
contemplated hereby, and (b) the term "Subsidiary" when used with respect to
any party, means any corporation or other organization, whether incorporated or
unincorporated, of which such party directly or indirectly owns or controls
more than 50% of the securities or other interests having by their terms
ordinary voting power to elect a majority of the board of directors or others
performing similar functions.
3.2. Authorization, Validity and Effect of Agreement. The Company has
the requisite corporate power and authority to execute and deliver this
Agreement and all agreements and documents contemplated hereby to be executed
and delivered by it. Subject only to the approval of this Agreement and the
Merger by the holders of a majority of the outstanding Shares, this Agreement,
the Offer, the Merger and the consummation by the Company of the transactions
contemplated hereby and thereby have been duly authorized by all requisite
corporate action. This Agreement has been duly and validly executed and
delivered by the Company and constitutes, and all agreements and documents
contemplated hereby to be executed and delivered by the Company (when executed
and delivered
10
pursuant hereto) will constitute, the valid and binding obligations of the
Company, enforceable against the Company in accordance with their respective
terms, except that (i) such enforceability may be subject to applicable
bankruptcy, insolvency or other similar laws now or hereinafter in effect
affecting creditors' rights generally and (ii) the availability of the remedy
of specific performance or injunctive or other forms of equitable relief may be
subject to equitable defenses and would be subject to the discretion of the
court before which any proceeding therefor may be brought.
3.3. Capitalization. The authorized capital stock of the Company
consists of 100,000,000 Shares and 25,000,000 shares of preferred stock, par
value $0.01 per share (the "Preferred Shares"). As of the close of business on
the last Business Day immediately preceding the date hereof (the "Measurement
Date"), (a) 17,708,686 Shares were issued and outstanding (not treating any
treasury shares as outstanding), each of which was duly authorized, validly
issued, fully paid and nonassessable and issued free of any preemptive
rights,(b) no Preferred Shares were issued or outstanding, (c) 5,000,000 Shares
were reserved for issuance under the Stock Option Plans, and (d) options to
purchase 1,227,350 Shares in the aggregate were outstanding under the Stock
Option Plans as more particularly described in Section 3.3 of the Company
Disclosure Letter (including the holders thereof, the expiration date, the
exercise prices thereof and the dates of grant). Since the Measurement Date, no
additional shares of capital stock of the Company have been issued and no other
options, warrants or other rights to acquire shares of the Company's capital
stock (collectively, the "Rights to Acquire") have been granted. Except as
described in the second preceding sentence, the Company has no outstanding
bonds, debentures, notes or other securities or obligations the holders of
which have the right to vote or which are convertible into or exercisable for
voting securities, capital stock or other equity or ownership interests in the
Company. Except as set forth in Section 3.3 of the Company Disclosure Letter,
there are not any existing options, warrants, calls, subscriptions, convertible
securities or other Rights to Acquire which obligate the Company or any of its
Subsidiaries to issue, exchange, transfer or sell any shares of capital stock
of the Company or any of its Subsidiaries other than Shares issuable under the
Stock Option Plans or awards granted pursuant thereto. There are no outstanding
contractual obligations of the Company or any of its Subsidiaries (a) to
repurchase, redeem or otherwise acquire any shares of capital stock of the
Company or any of its Subsidiaries, or (b) to vote or to dispose of any shares
of the capital stock of any of its Subsidiaries. After the Merger, none of the
Company or any of its Subsidiaries will have any obligation to issue, transfer
or sell any shares of its capital stock or other securities pursuant to any
employee benefit plan or otherwise.
3.4. Subsidiaries. Section 3.4 of the Company Disclosure Letter lists
all of the Subsidiaries of the Company. Each of the Company's Subsidiaries is a
corporation, partnership or limited liability company duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation or organization, has the corporate, partnership or similar power
and authority to own its properties and to carry on its business as it is now
being conducted, and is duly qualified to do business and is in good standing
in each jurisdiction in which the ownership of its property or the conduct of
its business requires such qualification, except for jurisdictions in which
such failure to be so qualified or to be in good standing would not reasonably
be expected to have a Company Material Adverse Effect. The Company owns,
directly or indirectly, all of the
11
outstanding shares of capital stock (or other ownership interests having by
their terms ordinary voting power to elect a majority of directors or others
performing similar functions with respect to such Subsidiary) of each of the
Company's Subsidiaries, free and clear of all liens, pledges, security
interests, claims or other encumbrances (collectively, "Liens"), except as set
forth in Section 3.4 of the Company Disclosure Letter. Each of the outstanding
shares of capital stock (or such other ownership interests) of each of the
Company's Subsidiaries is duly authorized, validly issued, fully paid and
nonassessable. Section 3.4 of the Company Disclosure Letter sets forth the
following information for each Subsidiary of the Company: (i) its jurisdiction
of incorporation or organization, (ii) its authorized capital stock or share
capital, and (iii) the number of issued and outstanding shares of capital
stock, share capital or other equity interests.
3.5. Other Interests. Except for interests in the Company's
Subsidiaries or as set forth on Section 3.5 of the Company Disclosure Letter,
neither the Company nor any of the Company's Subsidiaries owns, directly or
indirectly, any interest or investment (whether equity or debt) in any domestic
or foreign corporation, company, partnership, joint venture, business, trust or
entity.
3.6. No Conflict; Required Filings and Consents. (a) Except as set
forth in Section 3.6 of the Company Disclosure Letter, the execution and
delivery of this Agreement by the Company do not, and the performance by the
Company of this Agreement and the consummation by the Company of the
transactions contemplated hereby will not, (i) conflict with or violate the
certificate of incorporation or bylaws or equivalent organizational documents
of the Company or any of its Subsidiaries, (ii) subject to the Company making
any filings, notifications or registrations and obtaining any approvals,
consents or authorizations identified in Section 3.6(b), conflict with or
violate any domestic or foreign law, statute, rule, regulation or other legal
requirement ("Law") or order, judgment, injunction or decree ("Order")
applicable to the Company or any of its Subsidiaries or by which any property
or asset of the Company or any of its Subsidiaries is bound or affected, or
(iii) result in any breach of or constitute a default (or an event which with
or without notice or lapse of time or both would become a default) under,
result in the loss of a material benefit under, or give to others any right of
purchase or sale, or any right of termination, amendment, acceleration,
increased payments or cancellation of, or result in the creation of a Lien on
any property or asset of the Company or any of its Subsidiaries pursuant to,
any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or any property or asset of the Company or any of its Subsidiaries
is bound or affected, except, in the case of clauses (ii) and (iii), for any
such conflicts, violations, breaches, defaults, events, losses, rights,
payments, cancellations, encumbrances or other occurrences that, individually
or in the aggregate, would not be reasonably expected to have a Company
Material Adverse Effect.
(b) The execution and delivery of this Agreement by the Company does
not, and the performance of this Agreement and the consummation by the Company
of the transactions contemplated hereby will not, require any consent,
approval, authorization or permit of, or filing with or notification to, any
governmental or regulatory authority, domestic or foreign, including without
limitation any quasi-governmental, supranational, statutory, environmental
entity and any stock exchange, court or arbitral body (each a "Governmental
Entity"),
12
except (i) for (A) applicable requirements, if any, of the Exchange Act, (B)
the applicable pre-merger notification requirements of the Xxxx-Xxxxx-Xxxxxx
Antitrust Improvements Act of 1976, as amended, if any, and the rules and
regulations thereunder (the "HSR Act"), (C) the filing of a certificate of
merger pursuant to the DGCL, (D) the consents, approvals and authorizations set
forth in Section 3.6 of the Company Disclosure Letter, and (E) consents,
approvals, authorizations, orders, permits, filings or registrations related
to, or arising out of, compliance with statutes, rules or regulations
regulating the consumption, sale or serving of alcoholic beverages and (ii)
where the failure to obtain any such consent, approval, authorization or
permit, or to make any such filing or notification, would not, individually or
in the aggregate, reasonably be expected to have a Company Material Adverse
Effect.
3.7. Compliance with Laws. Except as set forth in the Company Filed
Reports, neither the Company nor any of its Subsidiaries is in conflict with,
or in default or violation of, (a) any Law or Order applicable to the Company
or any of its Subsidiaries or by which any property or asset of the Company or
any of its Subsidiaries is bound or affected (provided that no representation
or warranty is made in this Section 3.7 with respect to Environmental Laws), or
(b) any note, bond, mortgage, indenture, contract, agreement, lease, license,
permit, franchise or other instrument or obligation to which the Company or any
of its Subsidiaries is a party or by which the Company or any of its
Subsidiaries or any property or asset of the Company or any of its Subsidiaries
is bound or affected, and to the knowledge of the Company, neither the Company
nor any of its Subsidiaries is under review or investigation with respect to or
has been threatened to be charged with or given notice of any violation of any
such Law or Order, except in each case for such conflicts, defaults,
violations, reviews or investigations that would not, individually or in the
aggregate, reasonably be expected to have a Company Material Adverse Effect.
Except as described in the Company Filed Reports, the Company and its
Subsidiaries hold all licenses, permits, orders, registrations approvals and
other authorizations ("Permits") and have taken all actions required by
applicable Law or government regulations in connection with their business as
now conducted, except where the failure to obtain any such item or to take any
such action would not, individually or in the aggregate, reasonably be expected
to have a Company Material Adverse Effect. Except as described in the Company
Filed Reports, the Company and each of its Subsidiaries are in compliance with
the terms of all Permits, except where such failure to be in compliance would
not, individually or in the aggregate, reasonably be expected to have a Company
Material Adverse Effect.
3.8. SEC Documents. (a) The Company has filed all forms, reports and
documents required to be filed by it with the SEC since June 19, 1998
(collectively, the "Company Reports", and the Company Reports filed prior to
the date of this Agreement, the "Company Filed Reports"). As of their
respective filing dates, the Company Reports and any such reports, forms and
other documents filed by the Company with the SEC after the date of this
Agreement and until the Offer Completion Date (i) complied, or will comply, in
all material respects with the applicable requirements of the Securities Act of
1933, as amended (the "Securities Act"), the Exchange Act and the rules and
regulations thereunder and (ii) did not, and will not, contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary to make the statements made therein, in the light
of the circumstances under which they were made, not misleading. The
representation in clause (ii) of
13
the preceding sentence does not apply to any misstatement or omission in any
Company Report filed prior to the date of this Agreement which was superseded
by a subsequent Company Report filed prior to the date of this Agreement. No
Subsidiary of the Company is required to file any report, form or other
document with the SEC.
(b) Each of the financial statements included in or incorporated by
reference into the Company Reports (including the related notes and schedules)
presents fairly, in all material respects, the consolidated financial position
of the Company and its Subsidiaries as of its date and, to the extent
applicable, the results of operations, retained earnings or cash flows, as the
case may be, of the Company and its Subsidiaries for the periods set forth
therein (subject, in the case of unaudited statements, to normal recurring
year-end audit adjustments, none of which will be material in kind or amount),
in each case in accordance with United States generally accepted accounting
principles consistently applied ("GAAP") during the periods involved, except as
may be noted therein.
3.9. Litigation. Except as described in the Company Filed Reports or
in Section 3.9 of the Company Disclosure Letter, there are no actions, suits or
proceedings pending, publicly announced or, to the Knowledge of the Company,
threatened against or affecting the Company or any of its Subsidiaries and
there are no Orders of any Governmental Entity outstanding against the Company
or any of its Subsidiaries that, individually or in the aggregate, would
reasonably be likely to have a Company Material Adverse Effect.
3.10. Absence of Certain Changes. Except as described in the Company
Filed Reports or in Section 3.10 of the Company Disclosure Letter, from January
1, 1999 through the date of this Agreement, the Company and its Subsidiaries
have conducted their respective businesses in the ordinary course consistent
with past practice and there has not been (a) any Company Material Adverse
Effect or (b) any action that if taken after the date hereof would be a
violation of Section 5.1(a) through 5.1(p), inclusive.
3.11. Taxes. (a) (i) The Company has timely filed or caused to be
filed with the appropriate Governmental Entities all income and other material
Tax Returns required to be filed by or with respect to the Company and its
Subsidiaries, (ii) all material Taxes due with respect to periods covered by
such Tax Returns, all material Taxes required to be paid on an estimated or
installment basis and all material Taxes required to be withheld with respect
to the Company and its Subsidiaries have been timely paid or, if applicable,
withheld and paid to the appropriate taxing authority in the manner provided by
Law, (iii) no Federal, state, local or foreign audits, administrative
proceedings or court proceedings are pending with regard to any material Taxes
or Tax Returns of the Company or any of its Subsidiaries and there are no
outstanding deficiencies or assessments asserted or proposed, (iv) there are no
outstanding agreements, consents or waivers extending the statutory period of
limitations applicable to the assessment of any material Taxes or deficiencies
against the Company or any of its Subsidiaries and (v) neither the Company nor
any of its Subsidiaries is a party to any agreement providing for the
allocation or sharing of Taxes.
(b) For purposes of this Agreement, (i) "Taxes" means all taxes,
charges, fees, levies or other assessments imposed by any United States
Federal, state, or local taxing authority or by any non-U.S. taxing authority,
including, but
14
not limited to, income, gross receipts, excise, property, sales, use, transfer,
payroll, license, ad valorem, value added, withholding, social security,
national insurance (or other similar contributions or payments), franchise,
estimated, severance, stamp, and other taxes (including any interest, fines,
penalties or additions attributable to or imposed on or with respect to any
such taxes, charges, fees, levies or other assessments), and (ii) "Tax Return"
means any return, report, information return or other document (including any
related or supporting information and, where applicable, profit and loss
accounts and balance sheets) with respect to Taxes
3.12. Contracts. (a) There have been made available to Parent copies
of all of the following contracts to which Company or any of its Subsidiaries
is a party or by which any of them is bound (collectively, the "Material
Contracts"): (i) the agreement or form of agreement pursuant to which the
Company or its Subsidiaries holds a leasehold interest in or otherwise has an
economic interest in one or more hotel facilities; (ii) the agreements pursuant
to which the Company or any of its Subsidiaries manages any hotel or hotel
business by the Company or any of its Subsidiaries; (iii) the agreements
granting the Company or any of its Subsidiaries a franchise or license to
utilize a brand name or other rights of a hotel chain or system, or granting a
license or sublicense of any material trademark, trade name, copyright, patent,
service xxxx or trade secret, or any rights therein or application therefor;
(iv) contracts with any current or former officer or director of the Company or
any of its Subsidiaries; (v) contracts (A) for the sale of any of the material
assets of the Company or any of its Subsidiaries or the acquisition of any
material amount of assets by the Company or any of its Subsidiaries, other than
contracts entered into in the ordinary course of business, or (B) for the grant
to any person of any rights to purchase any of its material assets; (vi)
contracts which restrict in any material manner the Company or any of its
Subsidiaries from competing in any line of business or with any person in any
geographical area or which restrict in any material manner any other person
from competing with the Company or any of its Subsidiaries in any line of
business or in any geographical area; (vii) indentures, credit agreements,
security agreements, mortgages, guarantees, promissory notes, letters of
credit, hedging obligations, capitalized lease obligations, take or pay
contracts and other contracts relating to the borrowing of money; (viii) all
joint venture, partnership or similar agreements; and (ix) any material
contracts not made in the ordinary course of business.
(b) All of the Material Contracts are in full force and effect and are
the legal, valid and binding obligations of the Company and/or its
Subsidiaries, enforceable against them in accordance with their respective
terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium
and similar Laws affecting creditors' rights and remedies generally and to
general principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity). Neither the Company nor any of its
Subsidiaries is in breach or default in any material respect under any Material
Contract nor, to the Knowledge of the Company, is any other party to any
Material Contract in breach or default thereunder in any material respect.
3.13. Environmental Matters. (a) Except as disclosed in the Company
Filed Reports, as specified in Section 3.13 of the Company Disclosure Letter or
as would not, individually or in the aggregate, reasonably be expected to have
a Company Material Adverse Effect, (i) neither the Company nor any of its
current or former Subsidiaries has violated or is in violation of any
Environmental Law;
15
(ii) neither the Company nor any of its current or former Subsidiaries is
liable for any off-site contamination; (iii) neither the Company nor any of its
current or former Subsidiaries has any liability or remediation obligation
under any Environmental Law and in the case of clauses (ii) and (iii) of this
Section 3.13(a), to the knowledge of the Company, there are no facts,
conditions, situations or set of circumstances that could reasonably be
expected to result in or be the basis for any such liability; (iv) no assets of
the Company or any of its current or former Subsidiaries are subject to pending
or, to the Knowledge of the Company, threatened Liens under any Environmental
Law; (v) the Company and its Subsidiaries have all Permits required under any
Environmental Law ("Environmental Permits"); (vi) the Company and its
Subsidiaries are in compliance with their respective Environmental Permits;
(vii) neither the Company nor any of its current or former Subsidiaries has
received any claim, notice or request for information concerning any violation
or alleged violation of, or any liability or alleged liability under, any
Environmental Law; and (viii) no investigation, action or review is pending or,
to the knowledge of the Company, threatened by any Governmental Entity or other
person under any Environmental Law.
(b) For purposes of this Agreement, the term (i) "Environmental Laws"
means any national, federal, state or local Law (including, without limitation,
common law), Order, Permit or any agreement with any Governmental Entity or
other third party (whether domestic or foreign) relating to: (A) releases or
threatened releases of Hazardous Substances or materials containing Hazardous
Substances; (B) the manufacture, processing, distribution, handling, transport,
use, treatment, storage or disposal of Hazardous Substances or materials
containing Hazardous Substances; or (C) health and human safety or the
environment, and (ii) "Hazardous Substances" means: (A) those materials,
pollutants and/or substances defined in or regulated under the following
federal statutes and their state counterparts, as each may be amended from time
to time, and all regulations thereunder: the Hazardous Materials Transportation
Act of 1980, the Resource Conservation and Recovery Act, the Comprehensive
Environmental Response, Compensation and Liability Act, the Clean Water Act,
the Safe Drinking Water Act, the Atomic Energy Act, the Federal Insecticide,
Fungicide and Rodenticide Act, the Toxic Substances Control Act and the Clean
Air Act; (B) petroleum and petroleum products including crude oil and any
fractions thereof; (C) natural gas, synthetic gas and any mixtures thereof; (D)
radon; (E) any other contaminant; and (F) any materials, pollutants and/or
substance with respect to which any Governmental Entity requires environmental
investigation, monitoring, reporting or remediation.
3.14. Company Benefit Plans; ERISA Compliance. (a) Except as disclosed
in the Company Filed Reports or disclosed in Section 3.14(a) of the Company
Disclosure Letter, there are no compensation, bonus, pension, profit sharing,
deferred compensation, incentive compensation, stock ownership, stock purchase,
stock option or other stock related rights, fringe benefit, retirement,
vacation, disability, death benefit, supplemental unemployment benefits,
hospitalization, medical, dental, life, severance, post-employment benefits or
other plan, agreement, arrangement, policies or understanding, or employment,
severance, retention, consulting, change of control or similar agreement
whether formal or informal, oral or written, legally binding or not providing
benefits to any current or former employee, officer, director or shareholder of
the Company or any of its Subsidiaries or to which the Company or any of its
ERISA Affiliates (as
16
defined below) contributes or is or was obligated to contribute (collectively,
the "Company Benefit Plans", which will include each "employee benefit plan"
(within the meaning of Section 3(3) of the Employee Retirement Income Security
Act of 1974, as amended ("ERISA")), whether or not subject to ERISA, but shall
not include any Multiemployer Plan (as defined below)). Sections 3.14(a) and
5.9 of the Company Disclosure Letter contain a true and complete list of all
arrangements providing for termination or severance pay to any officer,
director or employee of the Company. An "ERISA Affiliate" of the Company means
any other Person which, together with the Company, would be treated as a single
employer under Section 414 of the Code.
(b) Each Company Benefit Plan has been administered in all material
respects in accordance with its terms, all applicable Laws, including ERISA and
the Code. Each Company Benefit Plans is in material compliance with all
applicable Laws, including the applicable provisions of ERISA, and the Code.
Each Company Benefit Plan that is intended to be qualified under Section 401(a)
or 401(k) of the Code is so qualified and each trust established in connection
with any Company Benefit Plan that is intended to be exempt from federal income
taxation under Section 501(a) of the Code is so exempt. No fact or event has
occurred which is reasonably likely to affect adversely the qualified status of
any such Company Benefit Plan or the exempt status of any such trust, except
for any occurrence that would not, individually or in the aggregate, reasonably
be expected to have a Company Material Adverse Effect. All contributions to,
and payments from, each Company Benefit Plan and Multiemployer Plan that are
required to be made in accordance with such Plans and applicable Laws
(including ERISA and the Code) have been timely made in all material respects.
(c) The Internal Revenue Service (the "IRS") has issued favorable
determination letters with respect to the qualification of each qualified
Company Benefit Plan and related trust, and the IRS has not taken any action to
revoke any such letter and nothing has occurred, whether by action or failure
to act, that could reasonably be expected to cause the loss of such
qualification.
(d) No Company Benefit Plan is or at any time was (i) subject to Title
IV of ERISA or (ii) subject to the minimum funding standards of Section 302 of
ERISA or Section 412 of the Code. Except as set forth in Section 3.14(d) of the
Company Disclosure Letter, neither the Company nor any of its Subsidiaries
contributes to any "multiemployer plan" within the meaning of Section 3(37) of
ERISA or a "multiple employer welfare arrangement" within the meaning of
Section 3(40) of ERISA (each a "Multiemployer Plan").
(e) No Company Benefit Plan provides medical benefits (whether or not
insured) with respect to current or former employees, officers or directors
after retirement or other termination of service, except as required by
applicable Law.
(f) Except as set forth on Section 3.14(f) or 5.9 of the Company
Disclosure Letter, the consummation of the transactions contemplated by this
Agreement will not, either alone or in combination with another event, (i)
entitle any current or former employee, officer or director of the Company to
severance pay, unemployment compensation or any other payment or (ii)
accelerate the time of payment or vesting, or increase the amount of
compensation, equity rights or benefits due any such employee, officer or
director.
17
(g) With respect to each Company Benefit Plan, the Company has
delivered or made available to Parent a true and complete copy of: (A) each
writing constituting a part of such Company Benefit Plan, including without
limitation all Company Benefit Plan documents and trust agreements; (B) the
most recent Annual Report (Form 5500 Series) and accompanying schedule, if any;
(C) the most recent annual financial report, if any; (D) the most recent
actuarial report, if any; and (E) the most recent determination letter from the
IRS, if any.
(h) With respect to each Company Benefit Plan, there have been no
prohibited transactions or breaches of any of the duties imposed on
"fiduciaries" (within the meaning of Section 3(21) of ERISA) by ERISA with
respect to the Company Benefit Plans that would reasonably be expected to
result in any material liability or excise tax under ERISA or the Code.
(i) Except as set forth on Section 5.9 of the Company Disclosure
Letter, there has been no amendment to, written interpretation of or
announcement (whether or not written) by the Company or any of its Subsidiaries
relating to, or change in employee participation or coverage under, any Company
Benefit Plan which would increase materially the expense of maintaining such
Company Benefit Plan above the level of the expense incurred in respect thereof
for the 12 months ended on the date of the most recent balance sheet for the
Company and its Subsidiaries.
(j) All contributions and payments due under each Company Benefit Plan
have either been discharged and paid or are adequately reflected as a liability
on the most recent balance sheet for the Company and its Subsidiaries in
accordance with GAAP.
(k) Except as set forth on Section 3.14(k) of the Company Disclosure
Letter, (i) neither the Company nor any of its Subsidiaries is a party to or
subject to any union contract or collective bargaining agreement, (ii) the
Company and its Subsidiaries are in compliance in all material respects with
all currently applicable laws respecting employment and employment practices,
terms and conditions of employment and wages and hours, and are not engaged in
any unfair labor practice that would affect the Company in any material
respect, and (iii) there is no unfair labor practice complaint pending or, to
the knowledge of the Company, threatened against the Company or any of its
Subsidiaries before the National Labor Relations Board that would affect the
Company in any material respect.
3.15. State Takeover Statutes; BHR Stockholders Agreement; Charter
Provisions. (a) The Company Board has approved the Offer, the Merger and this
Agreement and the transactions contemplated hereby and such approval is
sufficient to render inapplicable to the Offer, the Merger and this Agreement
and the transactions contemplated hereby the limitations on business
combinations contained in Section 203 of the DGCL (or any similar provision).
Neither Section 203 of the DGCL nor any other "fair price," "merger
moratorium," "control share acquisition" or other anti-takeover statute or
similar statute or regulation applies or purports to apply to the Offer, the
Merger, this Agreement or any of the transactions contemplated hereby.
(b) The Company has taken all action necessary to exempt Parent and
its direct and indirect wholly owned subsidiaries from the limitations on
ownership
18
of voting stock of the Company set forth in Article Seventh of the Company's
Amended and Restated Certificate of Incorporation.
(c) The Company has consented to the acquisition by Parent or its
direct and indirect wholly owned subsidiaries of Shares pursuant to the Offer
for purposes of Section 4.2 of the BHR Stockholders Agreement.
3.16. Voting Requirements. The affirmative vote of the holders of a
majority of the issued and outstanding Shares, voting as a single class, at the
Company Stockholders Meeting to adopt this Agreement and approve the Merger
("Company Stockholder Approval") is the only vote of the holders of any class
or series of the Company's capital stock necessary to approve and/or adopt this
Agreement and the transactions contemplated hereby and to approve the Merger.
3.17. No Brokers. The Company has not entered into any contract,
arrangement or understanding with any Person or firm which may result in the
obligation of the Company or Parent to pay any investment banker's or finder's
fees, brokerage or agent's commissions or other like payments in connection
with the negotiations leading to this Agreement or the consummation of the
transactions contemplated hereby, except that the Company has retained the
Company Financial Adviser as its financial advisor, the arrangements with which
have been disclosed to Parent prior to the date hereof. The Company or, if the
Effective Time occurs, the Surviving Corporation, will pay all amounts owed
pursuant to the foregoing arrangements.
3.18. Opinion of Company Financial Adviser. The Company has received
the opinion of the Company Financial Adviser to the effect that, as of the date
hereof, the consideration to be received by the Stockholders in the Offer and
the Merger is fair to the Stockholders from a financial point of view.
3.19. Proxy Statement; Offer Documents. The proxy statement to be sent
to the Stockholders in connection with a meeting of the Stockholders to
consider the Merger (the "Company Stockholders Meeting") or the information
statement to be sent to the Stockholders, as appropriate (such proxy statement
or information statement, as amended or supplemented, is herein referred to as
the "Proxy Statement"), at the date mailed to the Stockholders and at the time
of the Company Stockholder Meeting (i) will comply in all material respects
with the applicable requirements of the Exchange Act and the rules and
regulations thereunder and (ii) 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, in light of the
circumstances under which they were made, not misleading. Neither the Schedule
14D-9 nor any of the information provided by the Company or its officers,
directors, representatives, agents or employees for inclusion in the Schedule
TO or the Offer Documents will, at the respective times the Schedule 14D-9, the
Schedule TO and the other Offer Documents are filed with the SEC and are first
published, sent or given to Stockholders, 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 made therein, in light of the
circumstances under which they were made, not misleading; provided, however,
that no representation or warranty is made by the Company with respect to any
Parent SEC Information.
19
3.20. No Undisclosed Material Liabilities. There are no material
liabilities or obligations of the Company or any of its Subsidiaries of any
kind whatsoever, whether accrued, contingent, absolute, determined,
determinable or otherwise, and there is no existing condition, situation or set
of circumstances that could reasonably be expected to result in such a
liability, other than:
(a) liabilities or obligations disclosed in the Company Filed Reports;
and
(b) liabilities or obligations incurred in the ordinary course of
business consistent with past practices since September 30, 1999 that could not
reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect.
3.21. Transaction Fees. As of the date hereof, the Company expects
that the total amount of all legal and financial advisory fees,
transaction-related bonuses and other incidental expenses (such as printing,
proxy solicitation, SEC and HSR filing fees) will not exceed $1.75 million.
IV. REPRESENTATIONS AND WARRANTIES OF PARENT AND
PURCHASER
Each of Parent and Purchaser represents and warrants to the Company as
follows:
4.1. Existence; Good Standing; Corporate Authority. Each of Parent and
Purchaser is a corporation duly incorporated, validly existing and in good
standing under the laws of its jurisdiction of incorporation. Each of Parent
and Purchaser is duly licensed or qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the character
of the properties owned or leased by it or in which the transaction of its
business makes such qualification necessary, except where the failure to be so
qualified or to be in good standing would not reasonably be expected to have a
Parent Material Adverse Effect. A "Parent Material Adverse Effect" means any
change, effect, event or condition that has had or would reasonably be expected
to (i) have a material adverse effect on the business, results of operations or
financial condition of Parent, Purchaser and Parent's Subsidiaries, taken as a
whole, other than any change, effect, event or condition resulting from factors
generally affecting the U.S. hospitality or the United States economy, or (ii)
prevent or materially delay Parent's or Purchaser's ability to consummate the
transactions contemplated hereby. Each of Parent and Purchaser has all
requisite corporate power and authority to own, operate and lease its
properties and carry on its business as now conducted.
4.2. Authorization, Validity and Effect of Agreement. Each of Parent
and Purchaser has the requisite corporate power and authority to execute and
deliver this Agreement, the Stockholder Agreement and all agreements and
documents contemplated hereby and thereby to be executed respectively by it.
This Agreement, the Stockholder Agreement, the Offer, the Merger and the
consummation by Parent and Purchaser of the transactions contemplated hereby
and thereby have been duly and validly authorized by the respective Boards of
Directors of Parent and Purchaser and by Bass U.S.A., Incorporated as the sole
stockholder of Purchaser, and no other corporate action on the part of Parent
or Purchaser is necessary to authorize this Agreement, the Stockholder
Agreement,
20
the Offer and the Merger, or to consummate the transactions contemplated hereby
or thereby. This Agreement and the Stockholder Agreement constitute, and all
agreements and documents contemplated hereby to be executed and delivered by
Parent or Purchaser (when executed and delivered pursuant hereto) will
constitute, the valid and binding obligations of Parent or Purchaser, as the
case may be, enforceable respectively against them in accordance with their
respective terms, except that (i) the enforceability hereof and thereof may be
subject to applicable bankruptcy, insolvency or other similar laws now or
hereinafter in effect affecting creditors' rights generally and (ii) the
availability of the remedy of specific performance or injunctive or other forms
of equitable relief may be subject to equitable defenses and would be subject
to the discretion of the court before which any proceeding therefor may be
brought.
4.3. No Conflict; Required Filings and Consents. (a) The execution and
delivery of this Agreement and the Stockholder Agreement by Parent and
Purchaser do not, and the performance by the Parent and Purchaser of this
Agreement and the consummation by Parent and Purchaser of the transactions
contemplated hereby will not, (i) conflict with or violate the certificate of
incorporation, bylaws or other similar constituent documents of Parent or any
of its Subsidiaries, (ii) subject to Parent and Purchaser making any filings,
notifications or registrations and obtaining any approvals, consents or
authorizations identified in Section 4.3(b), conflict with or violate any Law
or Order applicable to Parent or any of its Subsidiaries or by which any
property or asset of Parent or any of its Subsidiaries is bound or affected, or
(iii) result in any breach of or constitute a default (or an event which with
or without notice or lapse of time or both would become a default) under,
result in the loss of a material benefit under, or give to others any right of
termination, amendment, acceleration, increased payments or cancellation of, or
result in the creation of a Lien on any property or asset of Parent or any of
its Subsidiaries pursuant to, any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which Parent or any of its Subsidiaries is a party or by which Parent or any
of its Subsidiaries or any property or asset of Parent or any of its
Subsidiaries is bound or affected, except in the case of clauses (ii) and
(iii), for the BHR Stockholders Agreement, the FelCor Stockholders Agreement
and for any such conflicts, violations, breaches, defaults, events, losses,
rights, payments, cancellations, encumbrances or other occurrences that would
not, individually or in the aggregate, reasonably be expected to have a Parent
Material Adverse Effect.
(b) The execution and delivery of this Agreement and the Stockholder
Agreement by Parent and Purchaser do not, and the performance of this Agreement
and the Stockholder Agreement and the consummation of the transactions
contemplated hereby and thereby by either of them will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any Governmental Entity, except (i) for (A) applicable requirements, if
any, of the Exchange Act, (B) the applicable pre-merger notification
requirements of the HSR Act, and (C) the filing of certificate of merger
pursuant to the DGCL, and (ii) where failure to obtain such consents,
approvals, authorizations or permits, or to make such filings or notifications,
would not, individually or in the aggregate, reasonably be expected to have a
Parent Material Adverse Effect.
4.4. No Brokers. Neither Parent nor Purchaser has entered into any
contract, arrangement or understanding with any Person or firm which may result
in the obligation of the Company to pay any investment banker's or finder's
fees,
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brokerage or agent's commissions or other like payments in connection with the
negotiations leading to this Agreement or the consummation of the transactions
contemplated hereby, any such amounts to be the sole liability of Parent.
4.5. Proxy Statement; Offer Documents. None of the information
provided by Parent, Purchaser or their respective officers, directors,
representatives, agents or employees for inclusion in the Proxy Statement,
will, on the date the Proxy Statement is first mailed to Stockholders or at the
time of the Company Stockholders Meeting, contain any untrue statement of a
material fact, or will omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Offer Documents
will not, at any time the Offer Documents are filed with the SEC or first
published, sent or given to the Stockholders, contain any untrue statement of a
material fact or omit to state any material fact necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. Notwithstanding the foregoing, Parent and Purchaser do not make
any representation or warranty with respect to any Company SEC Information.
4.6. Financing. The Purchaser will at the Closing have sufficient
funds available (either cash on hand or pursuant to existing financing
agreements) to pay the entire Merger Consideration and satisfy all of its other
obligations under this Agreement.
V. COVENANTS
5.1. Conduct of Business by the Company. During the period from the
date of this Agreement to the Effective Time, the Company will, and will cause
its Subsidiaries to, carry on their respective businesses in the usual, regular
and ordinary course in substantially the same manner as heretofore conducted
and, to the extent consistent therewith, use all reasonable efforts to keep
available the services of their current officers and other key employees and
preserve their relationships with all key customers, suppliers and other
Persons having business dealings with them to the end that their goodwill and
ongoing businesses will be unimpaired at the Effective Time. Without limiting
the generality or effect of the foregoing, except as described in Section 5.1
of the Company Disclosure Letter or as expressly provided by this Agreement,
during the period from the date of this Agreement to the Effective Time, the
Company will not, and will not permit any of its Subsidiaries to, without the
prior written consent of Parent:
(a) other than dividends and distributions (including liquidating
distributions) by a direct or indirect wholly owned Subsidiary of the Company
to its parent, (i) declare, set aside or pay any dividends on, or make any
other distributions in respect of, any of its capital stock, (ii) split,
combine or reclassify any of its capital stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of its capital stock, or (iii) purchase, redeem or otherwise acquire
any shares of capital stock of the Company or any of its Subsidiaries or any
other securities thereof or any rights, warrants or options to acquire any such
shares or other securities;
(b) except for the issuance of Shares pursuant to the exercise of
options that are outstanding on the Measurement Date, issue, deliver, sell,
pledge or otherwise encumber any shares of its capital stock, any other voting
securities
22
or any securities convertible into, or any rights, warrants or options to
acquire, any such shares, voting securities or convertible securities;
(c) amend its certificate of incorporation or bylaws;
(d) acquire assets or acquire by merging or consolidating with, or by
purchasing all or substantially all of the assets of, or in any other manner,
any business or any corporation, limited liability company, partnership, joint
venture, association or other business organization or division thereof in a
transaction or series of related transactions involving a total purchase price
(determined in accordance with GAAP) in excess of $1,000,000;
(e) sell, lease, license, mortgage or otherwise encumber or subject to
any Lien or otherwise dispose of any of its properties or assets, other than
(x) in the ordinary course of business consistent with past practice, and (y)
sales of assets which do not individually or in the aggregate exceed
$1,000,000;
(f) incur any indebtedness for borrowed money or guarantee any such
indebtedness of another Person, issue or sell any debt securities or warrants
or other rights to acquire any debt securities of the Company or any of its
Subsidiaries, or guarantee any debt securities of another Person;
(g) enter into any "keep well" or other agreement to maintain any
financial statement condition of another Person or enter into any arrangement
having the economic effect of any of the foregoing;
(h) make any loans, advances or capital contributions to, or
investments in, any other Person, other than to the Company or any wholly owned
Subsidiary of the Company or to officers and employees of the Company or any of
its Subsidiaries for travel, business or relocation expenses in the ordinary
course of business;
(i) make any capital expenditures other than expenditures in the
ordinary course of business consistent with past practice;
(j) make any change to its accounting methods, principles or
practices, except as may be required by GAAP, or make or change any Tax
election or method of accounting, settle or compromise any material Tax
liability or refund, or file its Tax Returns other than as is consistent with
past practice and in accordance with applicable law;
(k) except as required by Law or contemplated in Section 5.9 of the
Company Disclosure Letter, enter into, adopt or amend in any material respect
or terminate any Company Benefit Plan or any other agreement, plan or policy
involving the Company or any of its Subsidiaries and one or more of their
directors, officers or employees;
(l) hire or terminate the employment of any executive officer or
employee or, except as contemplated by Section 5.9 of the Company Disclosure
Letter, increase the compensation of any director, executive officer or other
employee of the Company or pay any benefit or amount not required by a plan or
arrangement as in effect on the date of this Agreement to any such Person other
than in the ordinary course of business;
23
(m) authorize, recommend, propose or announce an intention to adopt a
plan of complete or partial liquidation or dissolution of the Company or any of
its Subsidiaries;
(n) amend the terms of any Material Contract, other than in the
ordinary course of business, or relinquish any material right under or
terminate any Material Contract;
(o) enter into any material agreement not in the ordinary course of
business; or
(p) authorize, or commit or agree to take, any of the foregoing
actions or take any action which would make any of the representations or
warranties of the Company contained in this Agreement untrue or incorrect in
any material respect as of the date when made or as of a future date.
5.2. No Solicitation. (a) The Company, its affiliates and their
respective officers, directors, employees, representatives and agents will
immediately cease any existing discussions or negotiations, if any, with any
parties with respect to any Company Takeover Proposal, take the necessary steps
to inform such parties of the obligations undertaken in this Section 5.2, and
request that such parties promptly return all documents (and all copies
thereof) furnished to them by the Company or its representatives in connection
with such discussions and negotiations. The Company will not, nor will it
permit any of its Subsidiaries, officers, directors, employees, investment
bankers, financial advisors, attorneys, accountants or other representatives,
directly or indirectly, to (i) solicit, initiate or take any other action that
could reasonably be expected to facilitate or encourage (including without
limitation by way of furnishing information or providing access to the books,
records, properties or assets of the Company or any of its Subsidiaries), the
making of any proposal which constitutes a Company Takeover Proposal, (ii)
participate in any discussions or negotiations regarding any Company Takeover
Proposal, or (iii) grant any waiver or release under any standstill or similar
agreement with respect to any class of equity securities of the Company or any
of its Subsidiaries; provided, however, that if, at any time prior to the date
on which Purchaser purchases Shares in the Offer (the "Offer Completion Date"),
the Company Board determines in good faith by a majority vote that it has
received a Superior Proposal, the Company may, (A) furnish information with
respect to the Company and any of its Subsidiaries to such Person following
compliance with its obligations under this Section 5.2(b), pursuant to a
customary confidentiality agreement and (B) participate in discussions and
negotiations with such Person regarding such Superior Proposal. For purposes of
this Agreement, "Company Takeover Proposal" means any written proposal or offer
from any Person relating to any direct or indirect acquisition or purchase of
20% or more of the assets, net income or net revenues of the Company and its
Subsidiaries or 20% or more of any class of equity securities of the Company or
any of its Subsidiaries, any tender offer or exchange offer for Shares for any
class of equity securities of the Company or any of its Subsidiaries, or any
merger, consolidation, business combination, recapitalization, liquidation,
dissolution or similar transaction involving the Company or any of its
Subsidiaries, other than the transactions contemplated by this Agreement, or
any other transaction that is intended to or could frustrate the completion of
the transactions contemplated hereby. "Superior Proposal" means any bona fide,
unsolicited written Company Takeover Proposal that (y) involves the direct or
indirect acquisition or purchase of 100% of the
24
assets of the Company and its Subsidiaries or 50% or more of the Common Stock
of the Company and (z) involves payment of consideration to the Company or the
Stockholders and other terms and conditions that, taken as a whole, the Company
Board determines in good faith by a majority vote, after consulting with a
financial advisor of nationally recognized reputation, and taking into account
all the terms and conditions of the Company Takeover Proposal, including any
breakup fees, expense reimbursement provisions and conditions to consummation,
are more favorable and provide greater value to all the Company's stockholders
than as provided hereunder and for which financing, to the extent required, is
then fully committed or the Company Board determines, after consulting with a
financial advisor of nationally recognized reputation, is available. The
Company shall notify Parent promptly (but in no event later than 24 hours)
after receipt by the Company (or any of its advisors) of any Company Takeover
Proposal or any request for information relating to the Company or any of its
Subsidiaries or for access to the business, properties, assets, books or
records of the Company or any of its Subsidiaries by any Person that may be
considering making, or has made, a Company Takeover Proposal. The Company shall
provide such notice orally and in writing and shall identify the Person making
such Company Takeover Proposal, and provide in reasonable detail the terms and
conditions of any such Company Takeover Proposal, indication or request. The
Company shall keep Parent fully informed, on a current basis, of the status and
material details of any such Company Takeover Proposal, indication or request.
(b) Except as expressly permitted by this Section 5.2(b), neither the
Company Board nor any committee thereof may (i) withdraw or modify, or propose
publicly to withdraw or modify, in a manner adverse to Parent or Purchaser, the
approval or recommendation by the Company Board or such committee of the Offer,
the Merger or this Agreement, (ii) approve or recommend, or propose publicly to
approve or recommend, any Company Takeover Proposal, or (iii) cause the Company
to enter into any letter of intent, agreement in principle, acquisition
agreement or other similar agreement related to any Company Takeover Proposal
(each, a "Company Acquisition Agreement"). Notwithstanding the foregoing, in
the event that prior to the Offer Completion Date, the Company Board determines
in good faith by a majority vote that the Company has received a Superior
Proposal, the Company Board may, subject to Section 7.5(b), withdraw or modify
its approval or recommendation of the Offer, the Merger or this Agreement,
approve or recommend a Superior Proposal or terminate this Agreement pursuant
to Section 7.3(c), provided, however, that not fewer than two Business Days
prior to taking such action, the Company will notify Parent in writing of its
intention to take such action and provide Parent with a reasonable opportunity
to respond to any such Company Takeover Proposal. The Company agrees to notify
Parent promptly if its intention to enter into a Company Acquisition Agreement
shall change at any time or the Company Board shall have authorized the Company
to do so.
(c) Nothing contained in this Section 5.2 will prohibit the Company,
following its receipt of a Superior Proposal, from taking and disclosing to its
Stockholders a position contemplated by Rule 14e-2(a) promulgated under the
Exchange Act.
5.3. Filings, Reasonable Efforts. (a) Upon the terms and subject to
the conditions set forth in this Agreement, each of the parties will use all
reasonable efforts to take, or cause to be taken, all actions, and to do, or
cause to be done, and
25
to assist and cooperate with the other parties in doing, all things, necessary,
proper or advisable to consummate and make effective, in the most expeditious
manner practicable, the Offer, the Merger and the other transactions
contemplated by this Agreement, including without limitation (i) obtaining of
all necessary actions or nonactions, waivers, consents and approvals from
Governmental Entities and making of all necessary registrations and filings
(including filings with Governmental Entities) and taking of all reasonable
steps as may be necessary to obtain an approval or waiver from, or to avoid an
action or proceeding by, any Governmental Entity, (ii) obtaining of all
necessary consents, approvals or waivers from third parties, and (iii)
execution and delivery of any additional instruments necessary to consummate
the transactions contemplated by, and to fully carry out the purposes of, this
Agreement.
(b) In connection with and without limiting the foregoing, the Company
will (i) take all action necessary to ensure that no state takeover statute or
similar statute or regulation is or becomes applicable to the Offer, the Merger
or any of the other transactions contemplated hereby and (ii) if any state
takeover statute or similar statute or regulation becomes applicable thereto,
take all action necessary to ensure that the Offer and the Merger and such
other transactions may be consummated as promptly as practicable on the terms
contemplated hereby and otherwise to minimize the effect of such statute or
regulation thereon.
(c) If, at any time after the Effective Time, the Surviving
Corporation considers or is advised that any deeds, bills of sale, assignments,
assurances or any other actions or things are necessary or desirable to vest,
perfect or confirm of record or otherwise in the Surviving Corporation its
right, title or interest in, to or under any of the rights, properties or
assets of Purchaser or the Company or otherwise to carry out this Agreement,
the officers and directors of the Surviving Corporation will be authorized to
execute and deliver, in the name and on behalf of Purchaser or the Company, all
such deeds, bills of sale, assignments and assurances and to take and do, in
the name and on behalf of Purchaser or the Company, all such other actions and
things as may be necessary or desirable to vest, perfect or confirm any and all
right, title and interest in, to and under such rights, properties or assets in
the Surviving Corporation or otherwise to carry out this Agreement.
5.4. Inspection of Records. (a) From the date hereof to the Effective
Time, the Company will (i) allow all designated officers, attorneys,
accountants and other representatives of Parent reasonable access at all
reasonable times to the officers, key employees, accountants and other
representatives of the Company and its Subsidiaries and the books and records
of the Company and its Subsidiaries and (ii) furnish to Parent and its counsel,
financial advisors, auditors and other authorized representatives such
financial and operating data and other information as such Persons may
reasonably request.
(b) Subject to the requirements of applicable Law, and except for such
actions as are necessary to disseminate the Offer Documents and any other
documents necessary to consummate the Offer and the Merger, the parties will,
and will instruct each of their respective Affiliates, associates, partners,
employees, agents and advisors to, hold in confidence all such information as
is confidential or proprietary and will use such information only in connection
with the Offer and the Merger.
26
(c) If the transactions contemplated herein are not consummated, then
each receiving party shall return to the disclosing party all documents,
studies, analyses, compilations, data and other information provided by the
disclosing party to such receiving party or compilations, extracts, summaries
or other documents prepared by such receiving party from information supplied
by the disclosing party (together, the "Confidential Information"). No
receiving party shall use or reveal to any third party any of the Confidential
Information, provided, that the obligations of any receiving party hereunder
shall not apply to:
(i) any Confidential Information which was known to or
already in the possession of such receiving party prior to its
disclosure by the disclosing party or developed by the receiving party
other than in breach of this Agreement, provided, that such
Confidential Information was not, to the knowledge of the receiving
party obtained in violation of another confidentiality agreement or
similar obligation with the disclosing party or another party;
(ii) any Confidential Information which is disclosed to the
receiving party by a third party (which term shall not include the
counsel, accountants and other non-employee representatives of the
Company) having, to the knowledge of the receiving party, the legal
right to make such disclosure; or
(iii) any Confidential Information which is required to be
disclosed by order of any court or other tribunal of competent
jurisdiction or by any other applicable Law, provided, that the
receiving party shall notify the disclosing party of any order
promptly so as to afford the disclosing party the opportunity to
intervene in order to prevent such disclosure, if the disclosing party
so desires.
5.5. Publicity. The initial press release relating to this Agreement
will be in the form of a joint press release previously agreed between Parent
and the Company and thereafter the Company and Parent will, subject to their
respective legal obligations (including requirements of stock exchanges and
other similar regulatory bodies), consult with each other, and use reasonable
efforts to agree upon the text of any press release, before issuing any such
press release or otherwise making public statements with respect to the
transactions contemplated hereby and in making any filings with any
Governmental Entity or with any national securities exchange with respect
thereto.
5.6. Proxy Statement. If required by applicable Law, the Company will
promptly prepare and file with the SEC as soon as practicable after the Offer
Completion Date the Proxy Statement, will use its reasonable best efforts to
have the Proxy Statement cleared by the SEC and promptly thereafter will mail
the Proxy Statement to the Stockholders. Any Proxy Statement will contain the
recommendation of the Company Board that the Stockholders approve and adopt
this Agreement and approve the Merger and the other transactions contemplated
hereby. The Company agrees not to mail the Proxy Statement to the Stockholders
until Parent confirms that the information provided by Parent and Purchaser
continues to be accurate. If at any time prior to the Company Stockholders
Meeting any event or circumstance relating to the Company or any of its
Subsidiaries or Affiliates, or its or their respective officers or directors,
should be discovered by the Company that is required to be set forth in a
supplement to any
27
Proxy Statement, the Company will inform Parent and Purchaser to supplement
such Proxy Statement and mail such supplement to the Stockholders.
5.7. Insurance; Indemnity. (a) At the Effective Time, the certificate
of incorporation and bylaws of the Surviving Corporation will include
indemnification provisions substantially equivalent to those contained in the
certificate of incorporation and bylaws of the Company as of the date of this
Agreement. The indemnification provisions in the certificate of incorporation
and bylaws of the Surviving Corporation shall not be amended, repealed or
otherwise modified for a period of six years after the Effective Time in any
manner that would adversely affect the rights thereunder of individuals who as
of the date hereof were directors, officers, employees, fiduciaries or agents
of the Company or its Subsidiaries or who otherwise would be entitled to
indemnification under the certificate of incorporation, bylaws or
indemnification agreements of the Company or its Subsidiaries (the "Indemnified
Parties"). Notwithstanding any other provision hereof, the provisions of this
Section 5.7 are intended to be for the benefit of, and will be enforceable by,
each Indemnified Party, his or her heirs and his or her representatives.
(b) The Company and the Surviving Corporation, as applicable, will
maintain in effect for not less than six years after the Offer Completion Date
policies of directors' and officers' liability insurance (containing terms and
conditions with respect to coverage and amount which are no less advantageous
to the Persons currently covered by such policies of the Company and its
Subsidiaries as insured) with respect to matters existing or occurring at or
prior to the Offer Completion Date; provided that in satisfying its obligations
under this Section 5.7(b), the Surviving Corporation shall not be obligated to
pay annual premiums in excess of 200% of the amount per annum the Company paid
for the fiscal year ending December 31, 1999, and; provided further, that if
the premium for such coverage exceeds such amount, Parent or the Surviving
Corporation shall purchase a policy with the greatest coverage available for
such 200% of the amount spent per annum by the Company for its fiscal year
ending December 31, 1999.
5.8. Company Stockholders Meeting. (a) The Company will take all
action necessary in accordance with applicable Law and its certificate of
incorporation and bylaws to convene a meeting of the Stockholders as promptly
as practicable after the Offer Completion Date to consider and vote upon the
approval and adoption of this Agreement and the Merger. The Company Board will
recommend such approval and adoption and the Company will take all lawful
action to solicit such approval, including without limitation timely mailing
any Proxy Statement; provided, however, that such recommendation is subject to
any action, including any withdrawal or change of its recommendation, taken by,
the Company Board, expressly permitted by Section 5.2(b). Without limiting the
generality or effect of the foregoing, the Company's obligations pursuant to
the first sentence of this Section 5.8 will not be affected by the
commencement, public proposal, public disclosure or communication to the
Company of any Company Takeover Proposal. If the Parent or Purchaser purchases
any Common Stock pursuant to the Offer, the record date for the Company
Stockholder Meeting shall be a date subsequent to the date the Parent or
Purchaser becomes a record holder of Common Stock purchased pursuant to the
Offer.
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(b) Notwithstanding Section 5.8(a) hereof, in the event that Parent,
Purchaser or any other Subsidiary of Parent acquires at least 90% of the
outstanding Voting Securities pursuant to the Offer or otherwise, the parties
hereto agree, at the request of Parent or Purchaser, to take all necessary and
appropriate action to cause the Merger to become effective in accordance with
Section 253 of the DGCL without a meeting of Stockholders as soon as
practicable after the acceptance for payment and purchase of Shares by
Purchaser pursuant to the Offer.
5.9. Certain Employee Matters. Prior to or at the Effective Time, the
Parent, the Company and the Surviving Corporation agree to take the actions as
are necessary to carry out the matters described in Section 5.9 of the Company
Disclosure Schedule.
VI. CONDITIONS PRECEDENT
6.1. Conditions to Each Party's Obligation To Effect the Merger. The
respective obligations of each party to effect the Merger will be subject to
the fulfillment at or prior to the Closing Date of the following conditions:
(a) Purchaser shall have made, or caused to be made, the Offer and
shall have purchased, or caused to be purchased, the Shares validly tendered
and not withdrawn pursuant to the Offer, provided, that this condition shall be
deemed to have been satisfied with respect to the obligation of Parent and
Purchaser to effect the Merger if Purchaser fails to accept for payment or pay
for Shares pursuant to the Offer in violation of the terms of the Offer or of
this Agreement;
(b) If required by the DGCL, this Agreement and the transactions
contemplated hereby shall have been approved in the manner required by
applicable Law by the holders of the issued and outstanding shares of capital
stock of the Company; and
(c) No Order or Law enacted, entered, promulgated, enforced or issued
by any court of competent jurisdiction or other Governmental Entity or other
legal restraint or prohibition (collectively, "Restraints") preventing the
consummation of the Merger shall be in effect.
VII. TERMINATION
7.1. Termination by Mutual Consent. This Agreement may be terminated
at any time prior to the Effective Time, whether or not the Company Stockholder
Approval has been obtained, by the mutual consent of Parent and the Company.
7.2. Termination by Either Parent or Company. This Agreement may be
terminated by action of the Board of Directors of either Parent or the Company,
whether or not the Company Stockholder Approval has been obtained, if (a) the
Offer Completion Date shall not have occurred on or before May 31, 2000 (the
"Outside Date"); provided, however, that no party may terminate this Agreement
pursuant to this Section 7.2(a) if such party's failure to fulfill any of its
obligations under this Agreement shall have been the reason that the Offer
Completion Date shall not have occurred on or before said date, (b) any
Governmental Entity shall have issued a Restraint or taken any other action
permanently enjoining, restraining or otherwise prohibiting the consummation of
the Offer, the Merger or
29
any of the other transactions contemplated by this Agreement and such Restraint
or other action shall have become final and nonappealable, or (c) the Offer
expires or is terminated or withdrawn pursuant to its terms without any Shares
being purchased thereunder by Purchaser as a result of the failure of any of
the Offer Conditions to be satisfied or waived prior to the Expiration Date or
any extension thereof.
7.3. Termination by Company. This Agreement may be terminated at any
time prior to the Offer Completion Date by action of the Board of Directors of
the Company, if (a) the representations and warranties of the Parent or
Purchaser set forth in the Agreement which are not qualified by "materiality"
or "Parent Material Adverse Effect" shall not be true and correct in all
material respects, or the representations and warranties that are qualified by
"materiality" or "Parent Material Adverse Effect" shall not be true and correct
in all respects; provided that such breach of representation or warranty is not
curable or, if curable, is not cured within the earlier of (i) 10 calendar days
after written notice of such breach is given by the Company to Parent and (ii)
the Expiration Date; or (b) there has been a material breach or failure to
perform of any of the covenants set forth in this Agreement on the part of
Parent or Purchaser, which breach is not curable or, if curable, is not cured
within the earlier of (i) 10 calendar days after written notice of such breach
is given by the Company to Parent and (ii) the Expiration Date; or (c) (i) the
Board of Directors of the Company shall have authorized the Company, subject to
complying with the terms of this Agreement, to enter into a Company Acquisition
Agreement with respect to a Superior Proposal and the Company shall have
notified Parent in writing that it intends to enter into an agreement,
attaching a summary of the material terms thereof, (ii) Parent shall not have
made, within two Business Days of receipt of the Company's written notification
of its intention to enter into a Company Acquisition Agreement with respect to
a Superior Proposal, an offer that the Board of Directors determines, in good
faith after consultation with its financial advisors, is at least as favorable,
from a financial point of view, to the stockholders of the Company as the
Superior Proposal, and (iii) the Company prior to such termination pursuant to
this clause (c) shall have paid to Parent in immediately available funds the
fees required to be paid pursuant to Section 7.5.
7.4. Termination by Parent. This Agreement may be terminated at any
time prior to the Offer Completion Date by action of the Board of Directors of
Parent, if (a) the representations and warranties of the Company set forth in
the Agreement which are not qualified by "materiality" or "Company Material
Adverse Effect" shall not be true and correct in all material respects, or the
representations and warranties that are qualified by "materiality" or "Company
Material Adverse Effect" shall not be true and correct in all respects;
provided that such breach of representation or warranty is not curable or, if
curable, is not cured within the earlier of (i) 10 calendar days after written
notice of such breach is given by Parent to the Company or (ii) the Expiration
Date; or (b) there has been a material breach or failure to perform of any of
the covenants set forth in this Agreement on the part of the Company, which
breach is not curable or, if curable, is not cured within the earlier of (i) 10
calendar days after written notice of such breach is given by Parent to the
Company and (ii) the Expiration Date; or (c) (i) the Board of Directors or any
committee thereof of the Company shall have (A) failed to recommend or
withdrawn or modified in a manner adverse to Parent or Purchaser its approval
or recommendation of this Agreement, the Offer or the Merger or (B) approved or
recommended, or proposed publicly to approve or
30
recommend, a Company Takeover Proposal to the Stockholders or shall have
resolved to do any of the foregoing, or (ii) the Company shall have entered
into a Company Acquisition Agreement or the Company Board shall have authorized
the Company to do so; or (d) any person, entity or group (as defined in Section
13(d)(3) of the Exchange Act) shall have acquired beneficial ownership of more
than 20% of any class or series of capital stock of the Company, through the
acquisition of stock, the formation of a group or otherwise, or shall have been
granted any option, right or warrant, conditional or otherwise, to acquire
beneficial ownership of more than 20% of any class or series of capital stock
of the Company (other than Holdings and its Affiliates), or Holdings and its
Affiliates shall have acquired additional Shares after the date hereof.
7.5. Effect of Termination and Abandonment; Termination Fee. (a) In
the event of termination of this Agreement pursuant to this Article VII, all
obligations of the parties hereto will terminate, except the obligations of the
parties pursuant to this Section 7.5, the last sentence of Section 1.3, Section
5.4(b), Section 5.4(c) and Sections 8.1 through 8.15, inclusive.
Notwithstanding the foregoing or any other provision of this Agreement, in the
event of termination of this Agreement, nothing herein will prejudice the
ability of the non-breaching party to seek damages from any other party for any
prior deliberate or willful breach of this Agreement, including without
limitation attorneys' fees and the right to pursue any remedy at law or in
equity with respect thereto.
(b) The Company will pay to Purchaser an amount equal to $7 million
(the "Company Termination Fee") in any of the following circumstances:
(A) This Agreement is terminated pursuant to Section
7.3(c), 7.4(c) or 7.4(d); or
(B) This Agreement is terminated by Parent pursuant
to Section 7.4(a) or 7.4(b) and the Company shall not have
the right at such time to terminate this Agreement pursuant
to Section 7.3(a) or 7.3(b).
(c) The Company acknowledges that the agreements contained in this
Section 7.5 are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, Parent and Purchaser would not
enter into this Agreement; accordingly, if the Company fails promptly to pay
any amount due pursuant to this Section 7.5, and, in order to obtain such
payment, Parent or Purchaser commences a suit which results in a judgment
against the Company for any amounts set forth in this Section 7.5, the Company
will pay to Parent and Purchaser their costs and expenses (including attorneys'
fees and expenses) in connection with such suit, together with interest on the
amount of the fee at the prime rate of Citibank N.A. in effect on the date such
payment was required to be made. This Section 7.5 will survive any termination
of this Agreement.
(d) In the event that an amount is payable by the Company pursuant to
this Section 7.5, then, notwithstanding anything in this Agreement or the
Stockholder Agreement to the contrary, (i) such amount shall be full
compensation and liquidated damages for the loss suffered by the Parent as a
result of the failure of the transactions contemplated by this Agreement and
the Stockholder Agreement to be consummated and to avoid the difficulty of
31
determining damages under the circumstances and (ii) such amount shall be in
lieu of any other entitlement of the Parent, and shall be the sole and
exclusive liability of the Company and Holdings, with respect to all matters
arising under or relating to this Agreement and the Stockholder Agreement.
VIII. GENERAL PROVISIONS
8.1. Nonsurvival of Representations and Warranties. All
representations and warranties in this Agreement or in any instrument delivered
pursuant to this Agreement will terminate upon the termination of this
Agreement pursuant to Article VII.
8.2. Notices. Any notice or other communication required to be given
hereunder shall be in writing, and sent by reputable courier service (with
proof of service), by hand delivery or by facsimile (followed on the same day
by delivery by courier service (with proof of delivery) or by hand delivery),
addressed as follows:
If to Parent or Purchaser:
c/o Bass Hotels & Resorts
Three Ravinia Drive
Suite 2900
Xxxxxxx, Xxxxxxx 00000
Attn: Xxxxx X. Xxxxxx
Fax No.: (000) 000-0000
With copies to:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxx X. Xxxxxxxx
Fax No.: (000) 000-0000
If to the Company:
Bristol Hotels & Resorts
00000 Xxxxxx Xxxx
Xxxxxxx, Xxxxx 00000
Attn: J. Xxxxx Xxxxx
Fax No.: (000) 000-0000
With copies to:
Xxxxx, Day, Xxxxxx & Xxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attn: Xxxxxx X. Xxxxxxxx, Esq.
Fax No.: (000) 000-0000
32
or to such other address as any party will specify by written notice so given,
and such notice will be deemed to have been delivered as of the date so
telecommunicated or personally delivered.
8.3. Assignment; Binding Effect. Neither this Agreement nor any of the
rights, interests or obligations hereunder will be assigned by any of the
parties hereto (whether by operation of Law or otherwise) without the prior
written consent of the other parties except that Parent and Purchaser will have
the right to assign to any direct or indirect wholly owned subsidiary of Parent
or Purchaser any and all rights and obligations of Parent or Purchaser under
this Agreement, provided, that any such assignment will not relieve either
Parent or Purchaser from any of its obligations hereunder. Any assignment not
granted in accordance with the foregoing shall be null and void. Subject to the
first sentence of this Section 8.3, this Agreement will be binding upon and
will inure to the benefit of the parties hereto and their respective successors
and assigns. Notwithstanding anything contained in this Agreement to the
contrary, except for the provisions of Section 5.7 and 5.9, nothing in this
Agreement, expressed or implied, is intended to confer on any Person other than
the parties hereto or their respective heirs, successors, executors,
administrators and assigns any rights, remedies, obligations or liabilities
under or by reason of this Agreement.
8.4. Entire Agreement. This Agreement, Annex A, the Company Disclosure
Letter, the Stockholder Agreement and any documents delivered by the parties in
connection herewith or therewith, constitute the entire agreement among the
parties with respect to the subject matter hereof and supersede all prior
agreements and understandings among the parties with respect thereto. No
addition to or modification of any provision of this Agreement will be binding
upon any party hereto unless made in writing and signed by all parties hereto.
8.5. Amendment. This Agreement may be amended by the parties hereto,
by action taken by their respective Boards of Directors, at any time before or
after approval of matters presented in connection with the Merger by the
Stockholders but after any such Stockholder approval, no amendment will be made
which by Law requires the further approval of the Stockholders without
obtaining such further approval. This Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties hereto.
8.6. Governing Law. This Agreement will be governed by and construed
in accordance with the laws of the State of Delaware, without regard to its
conflict of laws principles.
8.7. Counterparts. This Agreement may be executed by the parties
hereto in separate counterparts, each of which when so executed and delivered
will be an original, but all such counterparts will together constitute one and
the same instrument. Each counterpart may consist of a number of copies hereof
each signed by less than all, but together signed by all of the parties hereto.
A facsimile copy of a signature page shall be deemed to be an original
signature page.
8.8. Headings. Headings of the Articles and Sections of this Agreement
are for the convenience of the parties only, and will be given no substantive
or interpretive effect whatsoever.
33
8.9. Certain Definitions/Interpretations. (a) For purposes of this
Agreement:
(i) An "Affiliate" of any Person means another Person that
directly or indirectly, through one or more intermediaries, controls,
is controlled by, or is under common control with, such first Person;
(ii) "Business Day" means any day other than a Saturday,
Sunday or day on which banks in New York, New York are authorized or
required by Law to close;
(iii) "FelCor Stockholders Agreement" means the Stockholders'
and Registration Rights Agreement, dated July 28, 1998, by and among
FelCor Lodging Trust, Bass PLC, Bass America Inc., Holiday
Corporation, United/Xxxxxx Investors I, L.P., United/Xxxxxx Investors
II, L.P., United/Xxxxxx Investors III, L.P., United/Xxxxxx Investors
IV, L.P. and United/Xxxxxx Investors V, L.P.;
(iv) "Knowledge" of any Person which is not an individual
means the actual knowledge of any of such Person's executive officers
after reasonable inquiry; and
(v) "Person" means an individual, corporation, partnership,
limited liability company, joint venture, association, trust,
unincorporated organization or other entity.
(b) When a reference is made in this Agreement to an Article, Section
or Annex, such reference will be to an Article or Section of, or an Annex to,
this Agreement unless otherwise indicated. Whenever the words "include,"
"includes" or "including" are used in this Agreement, they will be deemed to be
followed by the words "without limitation." The words "hereof," "herein" and
"hereunder" and words of similar import when used in this Agreement will refer
to this Agreement as a whole and not to any particular provision of this
Agreement. All terms used herein with initial capital letters have the meanings
ascribed to them herein and all terms defined in this Agreement will have such
defined meanings when used in any certificate or other document made or
delivered pursuant hereto unless otherwise defined therein. The definitions
contained in this Agreement are applicable to the singular as well as the
plural forms of such terms and to the masculine as well as to the feminine and
neuter genders of such term. Any agreement, instrument or statute defined or
referred to herein or in any agreement or instrument that is referred to herein
means such agreement, instrument or statute as from time to time amended,
modified or supplemented, including (in the case of agreements or instruments)
by waiver or consent and (in the case of statutes) by succession of comparable
successor statutes and references to all attachments thereto and instruments
incorporated therein. References to a Person are also to its permitted
successors and assigns.
8.10. Waivers. Except as provided in this Agreement, no action taken
pursuant to this Agreement, including without limitation any investigation by
or on behalf of any party, will be deemed to constitute a waiver by the party
taking such action of compliance with any representations, warranties,
covenants or agreements contained in this Agreement. The waiver by any party
hereto of a breach of any provision hereunder will not operate or be construed
as a waiver of
34
any prior or subsequent breach of the same or any other provision hereunder.
Subject to Section 1.5(b), at any time prior to the Effective Time, any party
hereto may (a) extend the time for the performance of any of the obligations or
other acts of the other parties hereto, (b) waive any inaccuracies in the
representations and warranties contained herein or in any document delivered
pursuant hereto, and (c) waive compliance with any of the agreements or
conditions contained herein. Any such extension or waiver shall be valid if set
forth in an instrument in writing signed by the party or parties to be bound
thereby.
8.11. Incorporation of Annex A. Annex A attached hereto is hereby
incorporated herein and made a part hereof for all purposes as if fully set
forth herein.
8.12. 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 provision will be
interpreted to be only so broad as is enforceable.
8.13. Enforcement of Agreement. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement was not performed in accordance with its specific terms or was
otherwise breached. It is accordingly agreed that, except as set forth in
Section 7.5(d), the parties will be entitled to an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically the terms and
provisions hereof, this being in addition to any other remedy to which they are
entitled at law or in equity.
8.14. Expenses. Except as set forth in Section 7.5, all fees and
expenses incurred in connection with the Offer, the Merger, this Agreement and
the transactions contemplated hereby and thereby will be paid by the party
incurring such fees or expenses, whether or not the Merger is consummated,
except that each of Parent and the Company will bear and pay one-half of the
costs and expenses incurred in connection with (i) the filing, printing and
mailing of the Proxy Statement, the Schedule 14D-9, the Schedule TO and the
other Offer Documents (including SEC filing fees) (all which will be printed at
a financial printer selected by Parent that is reasonably satisfactory to the
Company) and (ii) the filings of the premerger notification and report forms
under the HSR Act (including filing fees).
8.15. Jurisdiction; Consent to Service of Process. (a) Each party
hereby irrevocably and unconditionally submits, for itself and its property, to
the exclusive jurisdiction of the Chancery or other courts of the State of
Delaware (a "Delaware Court"), and any appellate court from any such court, in
any suit, action or proceeding arising out of or relating to this Agreement, or
for recognition or enforcement of any judgment resulting from any such suit,
action or proceeding, and each party hereby irrevocably and unconditionally
agrees that all claims in respect of any such suit, action or proceeding may be
heard and determined in a Delaware Court.
35
(b) It will be a condition precedent to each party's right to bring
any such suit, action or proceeding that such suit, action or proceeding, in
the first instance, be brought in a Delaware Court (unless such suit, action or
proceeding is brought solely to obtain discovery or to enforce a judgment), and
if each such court refuses to accept jurisdiction with respect thereto, such
suit, action or proceeding may be brought in any other court with jurisdiction;
provided that the foregoing will not apply to any suit, action or proceeding by
a party seeking indemnification or contribution pursuant to this Agreement or
otherwise in respect of a suit, action or proceeding against such party by a
third party if such suit, action or proceeding by such party seeking
indemnification or contribution is brought in the same court as the suit,
action or proceeding against such party.
(c) No party may move to (i) transfer any such suit, action or
proceeding from a Delaware Court to another jurisdiction, (ii) consolidate any
such suit, action or proceeding brought in a Delaware Court with a suit, action
or proceeding in another jurisdiction, or (iii) dismiss any such suit, action
or proceeding brought in a Delaware Court for the purpose of bringing the same
in another jurisdiction.
(d) Each party hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, (i) any objection which it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in a Delaware Court,
(ii) the defense of an inconvenient forum to the maintenance of such suit,
action or proceeding in any such court, and (iii) the right to object, with
respect to such suit, action or proceeding, that such court does not have
jurisdiction over such party. Each party irrevocably consents to service of
process in any manner permitted by law.
8.16 WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING
ARISING OUT OF OR CONTEMPLATED HEREBY.
[Remainder of page intentionally blank]
36
IN WITNESS WHEREOF, the parties have executed this Agreement and
caused the same to be duly delivered on their behalf on the day and year first
written above.
BRISTOL HOTELS & RESORTS
By: /s/ J. Xxxxx Xxxxx
-------------------------------
J. Xxxxx Xxxxx
Chairman and Chief
Executive Officer
BASS PLC
By: /s/ Xxxxxx X. Xxxxxxxxxx
-------------------------------
Xxxxxx X. Xxxxxxxxxx
Attorney-in-fact
BHR NORTH AMERICA, INC.
By: /s/ Xxxxxx Xxxxx
-------------------------------
Xxxxxx Xxxxx
President
37
ANNEX A
CONDITIONS TO COMPLETION OF THE OFFER
Notwithstanding any other provision of the Offer, Purchaser will not
be required to accept for payment or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) under the Exchange Act
(relating to Purchaser's obligation to pay for or return tendered Shares
promptly after expiration or termination of the Offer), to pay for any Shares,
and (subject to any such rules or regulations) may postpone the acceptance for
payment or payment for any Shares tendered, and, subject to the terms of the
Agreement, may amend or terminate the Offer (whether or not any Shares have
theretofore been purchased or paid for pursuant to the Offer) (i) unless the
following conditions have been satisfied: (a) there have been validly tendered
and not withdrawn prior to the Expiration Date a number of Shares which
represent, together with Shares held by Parent, Purchaser or any of their
Affiliates, a majority of the total voting power of the outstanding securities
of the Company entitled to vote in the election of directors or in a merger
("Voting Securities"), calculated on a fully diluted basis, on the date of
purchase (the "Minimum Condition") ("on a fully diluted basis" having the
following meaning: as of any date, the number of Shares outstanding, together
with the number of Shares the Company is then required to issue pursuant to
obligations outstanding at that date under employee stock option or other
benefit plans or otherwise) and (b) any waiting periods or approvals applicable
to the Offer or the Merger under the HSR Act shall have expired or been
terminated prior to the Expiration Date, or (ii) if at any time on or after the
date of this Agreement and before the Expiration Date (whether or not any
Shares have theretofore been accepted for payment or paid for pursuant to the
Offer), any of the following shall have occurred:
(A) any Governmental Entity shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation,
executive order, decree, injunction or other order, or shall have
taken, proposed or threatened any action or position, which would
reasonably be expected to (i) make the acceptance for payment of, or
the payment for some or all of the Shares illegal or otherwise
prohibited or otherwise, restrict, prevent or prohibit consummation of
the Offer or the Merger, (ii) impose limitations on the ability of
Purchaser to acquire or hold or to exercise effectively all rights of
ownership of the Shares, including the right to vote any Shares
purchased by it on all matters properly presented to the stockholders,
or (iii) prohibit or impose any material limitation on Purchaser's
ownership or operation of all or a material portion of the assets or
business of the Company or any of its Subsidiaries;
(B) the representations and warranties of the Company set
forth in the Agreement which are not qualified by "materiality" or
"Company Material Adverse Effect" shall not be true and correct in all
material respects, or the representations and warranties that are
qualified by "materiality" or "Company Material Adverse Effect" shall
not be true and correct in all respects, in each case as of the date
of consummation of the Offer as though made on or as of such date;
provided that such breach of representation or warranty is not curable
or, if curable, is not cured within the earlier of (i) 10 calendar
days after written notice of such breach is given by Parent to the
Company or (ii) the Expiration Date;
A-1
(C) there has been a material breach or failure to perform of
any of the covenants set forth in this Agreement on the part of the
Company, which breach is not curable or, if curable, is not cured
within the earlier of (i) 10 calendar days after written notice of
such breach is given by Parent to the Company and (ii) the Expiration
Date;
(D) there shall have occurred any change, event or
development that has had, or would reasonably be expected to have, a
Company Material Adverse Effect;
(E) this Agreement shall have been terminated in accordance
with its terms;
(F) the Company Board shall have (1) failed to recommend or
withdrawn or modified or changed its recommendation of the Offer, the
Merger or this Agreement (including by amendment of Schedule 14D-9) in
a manner adverse to Purchaser or Parent, or (2) approved or
recommended, or proposed publicly to approve or recommend, any Company
Takeover Proposal or resolved to do any of the foregoing.
(G) the Company shall have entered into a Company Acquisition
Agreement or the Company Board shall have authorized the Company to do
so; or
(H) any person, entity or group (as defined in Section
13(d)(3) of the Exchange Act) shall have acquired beneficial ownership
of more than 20% of any class or series of capital stock of the
Company, through the acquisition of stock, the formation of a group or
otherwise, or shall have been granted any option, right or warrant,
conditional or otherwise, to acquire beneficial ownership of more than
20% of any class or series of capital stock of the Company (other than
Holdings and its Affiliates), or Holdings and its Affiliates shall
have acquired additional Shares after the date hereof;
which in the judgment of Parent, in any case makes it inadvisable to
proceed with such acceptance for payment or payment for Shares.
The foregoing conditions are for the sole benefit of Purchaser and its
Affiliates and may be asserted by Purchaser, or Parent on behalf of Purchaser,
regardless of the circumstances (including without limitation any action or
inaction by Purchaser or any of its Affiliates) giving rise to any such
condition or may be waived by Purchaser, in whole or in part, from time to time
in its sole discretion, except as otherwise provided in this Agreement. The
failure by Purchaser at any time to exercise any of the foregoing rights will
not be deemed a waiver of any such right and each such right will be deemed an
ongoing right and may be asserted at any time and from time to time.
A-2
