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EXHIBIT 1.1
1,150,000 Shares
AMERIHOST PROPERTIES, INC.
Common Stock
PLACEMENT AGENCY AGREEMENT
October __, 1996
Xxxxxxxxxxx & Co., Inc.
Xxxxxxxxxxx Xxxxx
Xxxxx Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
Amerihost Properties, Inc., a Delaware corporation (the
"Company"), proposes to issue and sell (the "Offering") an aggregate of
1,150,000 shares (the "Shares") of common stock, $0.005 par value (the "Common
Stock") principally to selected institutional investors (collectively, and
together with all other purchasers of the Shares, the "Investors"). The
Company desires to engage you as its placement agent (the "Placement Agent") in
connection with the Offering. The closing of the Offering shall be conditioned
upon the sale of all the Shares.
The Company hereby confirms its agreements with the Placement
Agent as follows:
1. Agreement to Act As Placement Agent. On the basis of
the representations, warranties and agreements of the Company herein contained
and subject to all the terms and conditions of this Agreement, the Placement
Agent agrees to act as the Company's exclusive placement agent, on a best
efforts basis, in connection with the issuance and sale by the Company of the
Shares to the Investors. On the Closing Date (as defined below), the Company
shall pay to the Placement Agent in the aggregate ___% of the gross proceeds
received by the Company from the sale of the Shares in the Offering. In
addition, on the Closing Date, the Company shall pay to the Placement Agent
$________ for non-accountable expenses incurred in connection with the
Offering.
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2. Delivery and Payment. On or prior to the Effective
Date (as defined below), the Company, the Placement Agent and The Chase
Manhattan Bank, as escrow agent (the "Escrow Agent"), shall enter into an
escrow agreement in customary form mutually acceptable to the Company, the
Placement Agent, and the Escrow Agent (the "Escrow Agreement"), pursuant to
which an escrow account will be established, at the Company's expense, for the
benefit of the Investors (the "Escrow Account"). The Escrow Agreement will
provide that, (i) on or prior to the Closing Date, an amount equal to the price
per Share multiplied by the aggregate number of Shares to be purchased by the
Investors shall be deposited in the Escrow Account and (ii) on or prior to the
Closing Date, the Escrow Agent will notify the Company and the Placement Agent
in writing whether an amount equal to the proceeds of the sale of 1,150,000
Shares offered in the Offering (the "Requisite Funds") has been deposited in
the Escrow Account. At such time and on such date as may be agreed upon by the
Company and the Placement Agent (the "Closing Date"), but in no event prior to
the date on which the Escrow Agent shall have received all of the Requisite
Funds, the Escrow Agent will release the Requisite Funds from the Escrow
Account for collection by the Company and the Placement Agent as provided in
the Escrow Agreement and the Company shall inform The Depository Trust Company
("DTC") that the Shares may and shall be delivered to the Investors, which
delivery will be made through the facilities of DTC. The closing of the
Offering (the "Closing") shall take place at the offices of XxXxxxxxx, Will &
Xxxxx, 000 Xxxx Xxxxxx Xxxxxx, Xxxxxxx, Xxxxxxxx, at 10:00 a.m. Chicago time on
October __, 1996. All actions taken at the Closing shall be deemed to have
occurred simultaneously.
3. Registration Statement and Prospectus; Public
Offering. The Company has prepared in conformity with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), and the published
rules and regulations thereunder (the "Rules") adopted by the Securities and
Exchange Commission (the "Commission") a Registration Statement on Form S-2
(No. 333-6519), including a preliminary prospectus relating to the Shares, as
amended, and has filed with the Commission the Registration Statement (as
hereinafter defined) and such amendments thereto as may have been required to
the date of this Agreement and will file such additional amendments thereto as
may hereafter be required. Copies of such Registration Statement (including
all amendments thereto) and of the related preliminary prospectus, as amended,
have heretofore been delivered by the Company to you. The Registration
Statement described above at the time and on the date it becomes effective (the
"Effective Date"), including all exhibits thereto and the documents
incorporated by reference therein and information, if any, deemed to be part of
the Registration Statement pursuant to Rule 424(b) and Rule 430A of the Rules
as such Registration Statement may from time to time be amended or supplemented
pursuant to the Rules is referred to herein as the Registration Statement. The
term "preliminary prospectus" means any preliminary prospectus (as described in
Rule 430 of the Rules) included at any time as part of the Registration
Statement. The term "Prospectus" means the prospectus relating to the Shares
in the form first used to confirm sales of the Shares (whether such prospectus
was included in the Registration Statement at the time of effectiveness or was
subsequently filed with the Commission pursuant to Rule 424(b) of the Rules) or
the preliminary prospectus forming part of the Registration Statement at the
time it was declared effective together with the term sheet permitted under
Rule 434(b) and filed with the Commission pursuant to Rule 424(b), as
applicable.
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4. Representations and Warranties of the Company. The
Company represents and warrants to the Placement Agent as follows:
4.1 On the Effective Date, the Registration Statement
complied and, on the date any post-effective amendment to the
Registration Statement shall become effective, the Registration
Statement or any amendment or supplement thereto will comply, in all
material respects, with the applicable provisions of the Securities
Act and the Rules and did not or will not, as the case may be, contain
any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the
statements therein not misleading. On the date of the Prospectus, on
the date any amendment or supplement to the Prospectus is filed with
the Commission and on the Closing Date, neither the Prospectus nor any
amendment thereof or supplement thereto will 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 the light of the circumstances under which they
were made, not misleading. On the date that any preliminary
prospectus was first filed with the Commission, each preliminary
prospectus complied, and, on the date that any amendment or supplement
to any preliminary prospectus is filed with the Commission (whether
filed as part of the Registration Statement or any amendment thereto
or pursuant to Rule 424(a) of the Rules), each preliminary prospectus
will comply, in all material respects, with the applicable provisions
of the Securities Act and the Rules; on the date that any preliminary
prospectus was first filed with the Commission, each preliminary
prospectus did 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 the light of the
circumstances under which they were made, not misleading; and, on the
date that any amendment or supplement to any preliminary prospectus is
filed with the Commission (whether filed as part of the Registration
Statement or any amendment thereto or pursuant to Rule 424(a) of the
Rules), such preliminary prospectus as amended or supplemented 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 the light of the circumstances
under which they were made, not misleading. On the date that each of
the documents incorporated by reference in the Prospectus became
effective or was filed with the Commission, as the case may be, such
documents complied, in all material respects, with the applicable
provisions of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), and the rules and regulations of the Commission
thereunder; and, on such applicable date, none of such documents
contained any untrue statement of a material fact or omitted to state
any material fact required to be stated therein or necessary in order
to make the statements therein not misleading. The Company makes no
representation or warranty as to information contained in any
preliminary prospectus, the Registration Statement, the Prospectus or
any such amendment or supplement in reliance upon and in conformity
with written information furnished to the Company by the Placement
Agent specifically for use in the preparation thereof. The Company
acknowledges that, for purposes of this Agreement, the statements set
forth in the paragraph with respect to stabilization on the inside
front cover page of the Prospectus and the statements contained under
the caption "Plan of Distribution" in the Prospectus constitute the
only information furnished in writing by the
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Placement Agent specifically for inclusion in the Registration
Statement, the Prospectus or any preliminary prospectus.
4.2 The financial statements (including all notes and
schedules thereto) included in the Registration Statement and the
Prospectus fairly present the consolidated financial condition, the
consolidated results of operations and, cash flows and, for the fiscal
years ended December 31, 1995 and 1996, the consolidated stockholders'
equity of the Company at the respective dates and for the respective
periods to which they apply, in conformity with generally accepted
accounting principles, consistently applied throughout the periods
involved, and, with regard to the financial information at June 30,
1996 and for the 3 months and 6 months ended June 30, 1995 and 1996,
all adjustments necessary for a fair presentation of the results for
such periods have been made. The summary financial and statistical
information included in the Registration Statement and the Prospectus
fairly present the information shown therein and, to the extent based
upon or derived from the financial statements, have been compiled on a
basis consistent with the financial statements presented therein.
4.3 BDO Xxxxxxx, LLP, whose reports are filed with the
Commission as a part of the Registration Statement, are and, during
the periods covered by their reports, were independent public
accountants as required by the Securities Act and the Rules.
4.4 The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware. The Company is duly qualified and in good standing as a
foreign corporation in each jurisdiction in which the character or
location of its assets or real properties (owned, leased or licensed)
or the nature of its business makes such qualification necessary
(including every jurisdiction in which it owns or leases real
property) except for such jurisdictions where the failure to so
qualify would not have a material adverse effect on the assets or real
properties, business, results of operations or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise. Except as disclosed in the Registration Statement and the
Prospectus, the Company does not own, lease or license any asset or
real property or conduct any business outside the United States of
America. The Company has all requisite corporate power and authority,
and all necessary authorizations, approvals, consents, orders,
licenses, certificates and permits of and from all governmental or
regulatory bodies or any other person or entity, to own, lease,
license and operate its assets and real properties and conduct its
business as now being conducted and as described in the Registration
Statement and the Prospectus except for such authorizations,
approvals, consents, orders, licenses, certificates and permits the
absence of which would not have a material adverse effect upon the
assets or real properties, business, results of operations or
condition (financial or otherwise) of the Company; and no such
authorization, approval, consent, order, license, certificate or
permit contains a materially burdensome restriction other than as
disclosed in the Registration Statement and the Prospectus.
4.5 Each corporate subsidiary of the Company and its
subsidiaries, each of which is named in Schedule I to this Agreement
(each, a "Corporate Subsidiary"), has
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been duly incorporated and is validly existing as a corporation in
good standing under the laws of the jurisdiction of its incorporation.
Each Corporate Subsidiary is duly qualified and in good standing as a
foreign corporation in each jurisdiction in which the character or
location of its assets or real properties (owned, leased or licensed)
or the nature of its business makes such qualification necessary
(including every jurisdiction in which it owns or leases real
property) except for such jurisdictions where the failure to so
qualify would not have a material adverse effect on the assets or real
properties, business, results of operations or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise. Each Corporate Subsidiary has all requisite corporate
power and authority, and all necessary authorizations, approvals,
consents, orders, licenses, certificates and permits of and from all
governmental or regulatory bodies or any other person or entity, to
own, lease, license and operate its assets and real properties and
conduct its business as now being conducted except for such
authorizations, approvals, consents, orders, licenses, certificates
and permits the absence of which would not have a material adverse
effect upon the assets or real properties, business, results of
operations or condition (financial or otherwise) of the Company and
its subsidiaries considered as one enterprise; and no such
authorization, approval, consent, order, license, certificate or
permit contains a materially burdensome restriction other than as
disclosed in the Registration Statement and the Prospectus. All of
the issued and outstanding capital stock of each Corporate Subsidiary
has been duly authorized and validly issued, is fully paid and
nonassessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage,
pledge, lien, encumbrance or claim.
4.6 Each partnership in which the Company or its
subsidiaries owns a general or limited partnership interest, each of
which is named in Schedule II to this Agreement (each, a "Partnership
Subsidiary"), has been duly formed and is validly existing as a
limited or general partnership in good standing under the laws of the
jurisdiction of its formation. Each Partnership Subsidiary is duly
qualified and in good standing as a foreign partnership in each
jurisdiction in which the character or location of its assets or real
properties (owned, leased or licensed) or the nature of its business
makes such qualification necessary (including every jurisdiction in
which it owns or leases real property) except for such jurisdictions
where the failure to so qualify would not have a material adverse
effect on the assets or real properties, business, results of
operations or condition (financial or otherwise) of the Company and
its subsidiaries considered as one enterprise. Each Partnership
Subsidiary has all requisite partnership power and authority, and all
necessary authorizations, approvals, consents, orders, licenses,
certificates and permits of and from all governmental or regulatory
bodies or any other person or entity, to own, lease, license and
operate its assets and real properties and conduct its business as now
being conducted except for such authorizations, approvals, consents,
orders, licenses, certificates and permits the absence of which would
not have a material adverse effect upon the assets or real properties,
business, results of operations or condition (financial or otherwise)
of the Company and its subsidiaries considered as one enterprise; and
no such authorization, approval, consent, order, license, certificate
or permit contains a materially burdensome restriction other than as
disclosed in the Registration Statement and the Prospectus. The
partnership agreement of each Partnership Subsidiary
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is in full force and effect and all partnership interests in each such
Partnership Subsidiary held by the Company, directly or through
subsidiaries, are owned as described in the Prospectus, in each case,
except for security interests granted to support the Company's
operating line of credit or requests for additional capital pursuant
to any partnership agreement, free and clear of any security interest,
mortgage, pledge, lien, encumbrance or claim.
4.7 Each limited liability company in which the Company
or its subsidiaries owns a member interest, each of which is named in
Schedule III to this Agreement (each, a "Limited Liability
Subsidiary"), has been duly formed and is validly existing as a
limited liability company in good standing under the laws of the
jurisdiction of its formation. Each Limited Liability Subsidiary is
duly qualified and in good standing as a foreign limited liability
company in each jurisdiction in which the character or location of its
assets or real properties (owned, leased or licensed) or the nature of
its business makes such qualification necessary (including every
jurisdiction in which it owns or leases real property) except for such
jurisdictions where the failure to so qualify would not have a
material adverse effect on the assets or real properties, business,
results of operations or condition (financial or otherwise) of the
Company and its subsidiaries considered as one enterprise. Each
Limited Liability Subsidiary has all requisite organizational power
and authority, and all necessary authorizations, approvals, consents,
orders, licenses, certificates and permits of and from all
governmental or regulatory bodies or any other person or entity, to
own, lease, license and operate its assets and real properties and
conduct its business as now being conducted except for such
authorizations, approvals, consents, orders, licenses, certificates
and permits the absence of which would not have a material adverse
effect upon the assets or real properties, business, results of
operations or condition (financial or otherwise) of the Company and
its subsidiaries considered as one enterprise; and no such
authorization, approval, consent, order, license, certificate or
permit contains a materially burdensome restriction other than as
disclosed in the Registration Statement and the Prospectus. The
limited liability company agreement of each Limited Liability
Subsidiary is in full force and effect and all member interests in
each such Limited Liability Subsidiary held by the Company, directly
or through subsidiaries, are owned as described in the Prospectus, in
each case, except for security interests granted to support the
Company's operating line of credit, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim.
4.8 The Company and its subsidiaries own or possess
adequate rights to use the AmeriHost Inn trademark and trade name and
all other trademarks, trademark applications, trade names, service
marks, copyrights, copyright applications, licenses, know-how and
other similar rights (collectively, "Intangibles") necessary for the
conduct of their businesses as now being conducted and as described in
the Registration Statement and the Prospectus. Neither the Company
nor any of its subsidiaries has infringed, is infringing or has
received any notice of infringement on any Intangible of any other
person that will have a material adverse effect upon the assets or
real properties, business, results of operations or condition
(financial or otherwise) of the Company and
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its subsidiaries considered as one enterprise and the Company does not
know of any basis therefor.
4.9 The Company and its subsidiaries have good title to
each of the items of personal property which are reflected in the
financial statements referred to in Section 4.2 or are referred to in
the Registration Statement and the Prospectus as being owned by the
Company and valid and enforceable leasehold interests in each of the
items of real and personal property which are referred to in the
Registration Statement and the Prospectus as being leased by the
Company, in each case free and clear of all liens, encumbrances,
claims, security interests and defects, other than those described in
the Registration Statement and the Prospectus and those which do not
and will not have a material adverse effect upon the assets or real
properties, business, results of operations or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise.
4.10 The Company and its subsidiaries have good and
marketable title to, or valid and enforceable leasehold interests in,
all hotels and the properties on which they are located, as described
in the Registration Statement and the Prospectus, owned by the Company
and its subsidiaries, free and clear of all liens, charges,
encumbrances or restrictions, other than those described in the
Registration Statement and the Prospectus and those which do not and
will not have a material adverse effect upon the assets or real
properties, business, results of operations or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise; the use and occupancy of each of the hotels owned by the
Company and its subsidiaries comply in all material respects with all
applicable codes and zoning laws and regulations other than those the
noncompliance with which would not have a material adverse effect upon
the assets or real properties, business, results of operations or
condition (financial or otherwise) of the Company; neither the Company
nor any of its subsidiaries has any knowledge of any pending or
threatened condemnation or zoning change that will in any material
manner affect the size of, use of, improvements on, construction on,
or access to any of the hotels owned by the Company or any of its
subsidiaries or which would have a material adverse effect upon the
proposed use of such hotel; and neither the Company nor any of its
subsidiaries has any knowledge of any pending or threatened proceeding
or action that will in any material respect affect the size of, use
of, improvement of, construction on, or access to any of the hotels
owned by the Company or any of its subsidiaries.
4.11 Title insurance in favor of the mortgagee and the
Company is maintained with respect to each of the hotels owned by the
Company and its subsidiaries, other than those hotels held through
leasehold interests, in an amount at least equal to the greater of (i)
the cost of acquisition of such real property and (ii) the cost of
construction of the improvements located on such real property
(measured at the time of such construction).
4.12 The mortgages and deeds of trust encumbering the real
properties and assets described in the Prospectus are not convertible
into shares of Common Stock or other equity interest in the Company
nor does the Company hold a participating interest therein.
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4.13 For each hotel described in the Prospectus as "under
development," the Company has an option or an agreement to purchase
the underlying real property and has a commitment for the debt
financing necessary to effect the construction of the hotel; and, to
the Company's knowledge, the Company and its subsidiaries will upon
acquisition of the underlying real property receive good and
marketable title to such real property, free and clear of all liens,
charges, encumbrances or restrictions, other than the mortgages
obtained by the Company or any of its subsidiaries to finance the
purchase of such hotel and those that would not be material in
relation to the business of the Company and its subsidiaries
considered as one enterprise. For each hotel described in the
Prospectus as "under construction," the Company has secured the debt
financing necessary to effect the construction of the hotel and has
received approval of all governmental or regulatory bodies for all
requisite construction and zoning permits; and the Company and its
subsidiaries have, or, to the Company's knowledge, will upon
acquisition of the underlying real property to such hotel receive,
good and marketable title to such real property, free and clear of all
liens, charges, encumbrances or restrictions, other than the mortgages
obtained by the Company or any of its subsidiaries to finance the
purchase of such hotel and those that would not be material in
relation to the business of the Company and its subsidiaries
considered as one enterprise. The Company has obtained, or will
obtain, and will maintain title insurance in favor of the Company and
its subsidiaries on the underlying real property to each hotel under
development or under construction, not later than the time that debt
financing necessary to effect the construction of such hotel is
secured, in an amount at least equal to the cost of the acquisition of
such real property. To the knowledge of the Company: (i) the intended
use and occupancy of each hotel described in the Prospectus as under
development or under construction complies with all applicable codes
and zoning laws and regulations, except for such failures to comply
which would not individually or in the aggregate have a material
adverse effect on the ability of the Company to develop, construct and
own each such hotel; and (ii) there is no pending or threatened
condemnation, zoning change, environmental or other proceeding or
action that will in any material respect adversely affect the size of,
use of, improvements on, construction on, or access to each such hotel
under development or under construction.
4.14 There is no litigation or governmental or other
proceeding or investigation before any court or before or by any
public body or board pending or, to the Company's knowledge,
threatened (and the Company does not know of any basis therefor)
against, or involving the assets, real properties or business of, the
Company or any of its subsidiaries which would materially adversely
affect the business, results of operations or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise.
4.15 Except as disclosed in the Prospectus, to the
Company's knowledge, after due inquiry, (i) there are not present on
any of the real properties owned, or under development or under
construction, by the Company any hazardous substances, hazardous
materials, toxic substances, asbestos or waste materials
(collectively, "Hazardous Materials"), (ii) there have not occurred or
are presently occurring from any of such real properties any unlawful
spills, releases, discharges or disposal of Hazardous
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Materials, and (iii) all such real properties are in compliance with
all applicable local, state and federal environmental laws,
regulations, ordinances and administrative and judicial orders
relating to the generation, recycling, reuse, sale, storage, handling,
transport and disposal of any Hazardous Materials, which presence,
occurrence or failure would not have a material adverse effect on the
business, results of operations or condition (financial or otherwise)
of the Company and its subsidiaries considered as one enterprise. The
Company has caused Phase I Environmental Surveys to be completed with
respect to each of the real properties owned by the Company and its
subsidiaries or listed on Schedule IV to this Agreement and has
delivered copies of all such Environmental Surveys to the Placement
Agent.
4.16 Property and casualty insurance in favor of the
Company is maintained with respect to each of the real properties
owned by the Company and its subsidiaries, and will be obtained and
maintained with respect to each of the real properties containing a
hotel under development or under construction, in an amount and on
such terms as are reasonable and customary for businesses of this
type.
4.17 Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as described therein, (i) there has not been any material
adverse change in the assets or real properties, business, results of
operations, prospects or condition (financial or otherwise) of the
Company and its subsidiaries considered as one enterprise, whether or
not arising from transactions in the ordinary course of business; (ii)
neither the Company nor any of its subsidiaries has sustained any
material loss or interference with its assets, businesses or real
properties (whether owned or leased) from any labor dispute or any
court or legislative or other governmental action, order or decree;
and (iii) since the date of the latest balance sheet included in the
Registration Statement and the Prospectus, except as reflected
therein, neither the Company nor any of its subsidiaries has
undertaken any material liability or obligation, direct or contingent,
except such liabilities or obligations undertaken in the ordinary
course of business.
4.18 There is no document or contract of a character
required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement
which is not described or filed as required. Each such contract of
the Company or any of its subsidiaries described in the Prospectus or
listed as exhibits to the Registration Statement is in full force and
effect and is valid and enforceable by and against the Company or any
of its subsidiaries, as the case may be, in accordance with its terms,
assuming the due authorization, execution and delivery thereof by each
of the other parties thereto. Neither the Company or any of its
subsidiaries nor, to the Company's knowledge, any other party is in
material default in the observance or performance of any term or
obligation to be performed by it under any such agreement, and no
event has occurred which with notice or lapse of time or both would
constitute such a default, in any such case which default or event
would have a material adverse effect on the assets or real properties,
business, results of operations, prospects or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise. No default exists, and no event has occurred which with
notice or lapse of
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time or both would constitute a default, in the due performance and
observance of any term, covenant or condition, by the Company or any
of its subsidiaries of any other agreement or instrument to which the
Company or any of its subsidiaries is a party or by which they or
their real properties or businesses may be bound or affected, which
default or event would have a material adverse effect on the assets or
real properties, business, results of operations, prospects or
condition (financial or otherwise) of the Company and its subsidiaries
considered as one enterprise.
4.19 Neither the Company nor any of its subsidiaries is in
violation of any term or provision of their respective charters,
by-laws, partnership agreements or limited liability company
agreements or of any franchise, license, permit, judgment, decree,
order, statute, rule or regulation, where the consequences of such
violation would have a material adverse effect on the assets or real
properties, business, results of operations, prospects or condition
(financial or otherwise) of the Company and its subsidiaries
considered as one enterprise.
4.20 Neither the execution, delivery and performance of
this Agreement or the Escrow Agreement by the Company nor the
consummation of any of the transactions contemplated hereby or thereby
(including, without limitation, the issuance and sale by the Company
of the Shares) will give rise to a right to terminate or accelerate
the due date of any payment due under, or conflict with or result in
the breach of any term or provision of, or constitute a default (or an
event which with notice or lapse of time or both would constitute a
default) under, or require any consent or waiver under, or result in
the execution or imposition of any lien, charge or encumbrance upon
any real properties or assets of the Company or any of its
subsidiaries pursuant to the terms of, any indenture, mortgage, deed
of trust or other agreement or instrument to which the Company or any
of its subsidiaries is a party or by which they or any of their real
properties or businesses is bound, or any franchise, license, permit,
judgment, decree, order, statute, rule or regulation applicable to the
Company or any of its subsidiaries or violate any provision of the
charter, by-laws, partnership agreement or limited liability company
agreement of the Company or any of its subsidiaries, as applicable,
except for such consents or waivers which have already been obtained
and are in full force and effect.
4.21 The Company has an authorized, issued and outstanding
capital stock as set forth under the caption "Description of Capital
Stock" in the Prospectus. All of the outstanding shares of Common
Stock have been duly authorized and validly issued and are fully paid
and nonassessable and none of them was issued in violation of any
preemptive or other similar right. The Shares, when issued and sold
pursuant to this Agreement, will be duly authorized and validly
issued, fully paid and nonassessable and none of them will be issued
in violation of any preemptive or other similar right. Except as
disclosed in the Registration Statement and the Prospectus, there is
no outstanding option, warrant or other right calling for the issuance
of, and there is no commitment, plan or arrangement to issue, any
share of capital stock of the Company or any security convertible
into, or exercisable or exchangeable for, such capital stock. The
Common
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Stock and the Shares conform in all material respects to all
statements in relation thereto contained in the Registration Statement
and the Prospectus.
4.22 Subsequent to the respective dates as of which
information is given in the Registration Statement and the Prospectus,
except as described or referred to therein, the Company has not (i)
issued any securities or incurred any material liability or
obligation, direct or contingent, except such liabilities or
obligations incurred in the ordinary course of business, including,
without limitation, debt financing to acquire real properties and to
construct hotels thereon; (ii) entered into any material transaction
not in the ordinary course of business; or (iii) declared or paid any
dividend or made any distribution on any shares of its capital stock
or redeemed, purchased or otherwise acquired or agreed to redeem,
purchase or otherwise acquire any shares of its capital stock.
4.23 Except as disclosed in the Prospectus, no holder of
any security of the Company has the right to have any security owned
by such holder included in the Registration Statement or to demand
registration of any security owned by such holder during the period
ending 180 days after the date of this Agreement. The Company and
each of its executive officers and directors have delivered to the
Placement Agent their enforceable written agreement that, for a period
of 120 days after the date of this Agreement, each such party will
not, except for grants or issuances by the Company of stock options
pursuant to its stock option plans, and transfers to the Company of
Common Stock in payment for any indebtedness collaterized by such
Common Stock issuances by the Company of Common Stock upon the
exercise of stock options and warrants previously granted by the
Company or upon the exchange of outstanding equity interests in
certain Partnership Subsidiaries and transfers to the Company of
Common Stock in payment for any indebtedness collaterized by such
Common Stock, without the prior written consent of the Placement
Agent, sell, or otherwise dispose of, directly or indirectly, or
exercise any registration rights with respect to, any shares of Common
Stock (or any securities convertible into or exchangeable for any
shares of Common Stock or any rights to purchase or acquire shares of
Common Stock) owned by them.
4.24 All necessary corporate action has been duly and
validly taken by the Company to authorize the execution, delivery and
performance of this Agreement and the Escrow Agreement and the
issuance and sale of the Shares by the Company. This Agreement has
been duly and validly authorized, executed and delivered by the
Company and constitutes and will constitute the legal, valid and
binding obligations of the Company enforceable against the Company in
accordance with its terms.
4.25 Each approval, consent, order, authorization,
designation, declaration or filing by or with any regulatory,
administrative or other governmental body necessary in connection with
the execution and delivery by the Company of this Agreement and the
issuance and sale of the Shares by the Company (except such as may be
required under the Securities Act, such as may be necessary to qualify
the Shares for inclusion in the Offering by the Placement Agent under
state securities laws or such additional steps as may be required by
the National Association of Securities Dealers, Inc. (the "NASD") or
by the National Association of Securities Dealers Automated Quotation
("Nasdaq")
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National Market, if any) has been obtained or made and is in full
force and effect. The Shares are included for quotation on the Nasdaq
National Market.
4.26 Neither the Company nor any of its subsidiaries is
involved in any labor dispute nor, to the knowledge of the Company or
its subsidiaries, is any such dispute threatened, which dispute would
have a material adverse effect on the assets or real properties,
business, results of operations, prospects or condition (financial or
otherwise) of the Company and its subsidiaries considered as one
enterprise.
4.27 No transaction has occurred between or among the
Company and any of its officers or directors or any affiliate or
affiliates of any such officer or director that is required to be
described in and is not described in the Registration Statement and
the Prospectus.
4.28 The Company has not taken, nor will it take, directly
or indirectly, any action designed to or which might reasonably be
expected to cause or result in, or which has constituted or which
might reasonably be expected to constitute, the stabilization or
manipulation of the price of the Common Stock to facilitate the sale
or resale of any of the Shares.
4.29 The Company and its subsidiaries have filed all
federal, state, local and foreign tax returns which are required to be
filed through the date hereof, or have received extensions thereof,
and have paid all taxes shown on such returns to be due on or prior to
the date hereof and all assessments received by them to the extent
that the same are material and have become due.
4.30 The Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended.
4.31 The Company has complied with all of the requirements
and filed the required forms as specified in Florida Statutes Section
517.075.
5. Conditions of the Placement Agent's Obligations. The
obligations of the Placement Agent under this Agreement are subject to each of
the following terms and conditions:
5.1 The Prospectus shall have been timely filed with the
Commission in accordance with Section 6.1.1 of this Agreement.
5.2 No order preventing or suspending the use of any
preliminary prospectus or the Prospectus shall have been or shall be
in effect and no order suspending the effectiveness of the
Registration Statement shall be in effect and no proceedings for such
purpose shall be pending before or threatened by the Commission, and
any requests for additional information on the part of the Commission
(to be included in the Registration Statement or the Prospectus or
otherwise) shall have been complied with to the satisfaction of the
Placement Agent.
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5.3 The representations and warranties of the Company
contained in this Agreement shall be true and correct in all material
aspects when made and on and as of the Closing Date as if made on such
date and the Company shall have performed all covenants and agreements
and satisfied all the conditions contained in this Agreement required
to be performed or satisfied by it at or before the Closing Date.
5.4 The Placement Agent shall have received on the
Closing Date a certificate, addressed to the Placement Agent and dated
the Closing Date, of the chief executive officer or the chief
financial officer of the Company, to the effect that such person has
carefully examined the Registration Statement, the Prospectus, this
Agreement and the Escrow Agreement and that the representations and
warranties of the Company in this Agreement are true and correct in
all material respects on and as of the Closing Date with the same
effect as if made on the Closing Date and the Company has performed
all covenants and agreements and satisfied all conditions contained in
this Agreement required to be performed or satisfied by it at or prior
to the Closing Date.
5.5 The Placement Agent shall have received on the
Effective Date, at the time this Agreement is executed and on the
Closing Date, a letter or letters signed by BDO Xxxxxxx, LLP,
addressed to the Placement Agent and dated, respectively, the
Effective Date, the date of this Agreement and the Closing Date, in
form and substance reasonably satisfactory to the Placement Agent, as
to their status as independent accountants within the meaning of the
Securities Act and the Rules, the information in the Registration
Statement in response to Item 10 of Form S-2 under the Securities Act
and matters relating to the financial statements and other financial
and statistical information included in the Registration Statement and
the Prospectus.
5.6 The Placement Agent shall have received on the
Closing Date from XxXxxxxxx, Will & Xxxxx, counsel for the Company, an
opinion, addressed to the Placement Agent and dated the Closing Date,
and stating in effect that:
5.6.1 The Company has been duly incorporated and is
validly existing as a corporation in good standing under the
laws of the State of Delaware; the Company is duly qualified
and in good standing as a foreign corporation in each
jurisdiction listed on Schedule V to this Agreement; and the
Company has all requisite corporate power to own, lease,
license and operate its assets and real properties and conduct
its business as now being conducted and as described in the
Registration Statement and the Prospectus.
5.6.2 Each Corporate Subsidiary has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the jurisdiction of its
incorporation; each Corporate Subsidiary is duly qualified and
in good standing as a foreign corporation in each jurisdiction
listed on Schedule I to this Agreement; each Corporate
Subsidiary has all requisite corporate power and authority to
own, lease, license and operate its assets and real properties
and conduct its business as now being conducted; and all of
the issued and outstanding capital stock of each Corporate
Subsidiary has been duly authorized and validly
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issued, is fully paid and nonassessable and is owned by the
Company, directly or through subsidiaries.
5.6.3 Each Partnership Subsidiary has been duly
formed and is validly existing as a limited or general
partnership in good standing under the laws of the
jurisdiction of its formation; each Partnership Subsidiary is
duly qualified and in good standing as a foreign partnership
in each jurisdiction listed on Schedule II to this Agreement;
the partnership agreement of each Partnership Subsidiary is in
full force and effect; each Partnership Subsidiary has all
requisite partnership power and authority to own, lease,
license and operate its assets and real properties and conduct
its business as now being conducted; and all partnership
interests in each such Partnership Subsidiary held by the
Company, directly or through subsidiaries, are owned as
described in the Prospectus.
5.6.4 Each Limited Liability Subsidiary has been
duly formed and is validly existing as a limited liability
company in good standing under the laws of the jurisdiction of
its formation; each Limited Liability Subsidiary is duly
qualified and in good standing as a foreign limited liability
company in each jurisdiction listed on Schedule III to this
Agreement; the limited liability company agreement of each
Limited Liability Subsidiary is in full force and effect; each
Limited Liability Subsidiary has all requisite organizational
power and authority to own, lease, license and operate its
assets and real properties and conduct its business as now
being conducted; and all member interests in any such Limited
Liability Subsidiary held by the Company, directly or through
subsidiaries, are owned as described in the Prospectus.
5.6.5 The Company has authorized and issued capital
stock as set forth under the caption "Description of Capital
Stock" in the Prospectus; the certificates evidencing the
Shares are in due and proper legal form; all of the
outstanding shares of Common Stock have been duly and validly
authorized and have been duly and validly issued; and all of
the outstanding shares of Common Stock are fully paid and
nonassessable and none of them was issued in violation of any
preemptive or other similar right. The Shares when issued and
sold pursuant to this Agreement will be duly and validly
issued, fully paid and nonassessable and none of them will
have been issued in violation of any preemptive or other
similar right. Except as disclosed in the Registration
Statement and the Prospectus, there is no outstanding option,
warrant or other right issued by the Company calling for the
issuance of, and, to the knowledge of such counsel, no
commitment, plan or arrangement to issue, any share of capital
stock of the Company or any security convertible into,
exercisable for, or exchangeable for capital stock of the
Company. The descriptions of the Common Stock and the Shares
contained in the Registration Statement and the Prospectus
conform to the Company's Restated Certificate of
Incorporation, as amended.
5.6.6 All contracts, instruments or other documents
referred to in the Registration Statement and the Prospectus
are fairly summarized or disclosed
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therein, and filed as exhibits thereto or incorporated by
reference therein as required, and, to such counsel's
knowledge, after due inquiry, no contract, instrument or
other document required to be so summarized, disclosed, filed
or incorporated, in whole or in part, by reference therein has
not been so summarized, disclosed, filed or incorporated by
reference therein. All statutes, legal or governmental
proceedings, and all agreements and other documents required
to be described in the Registration Statement (or incorporated
by reference therein) have been so described.
5.6.7 The agreement of the Company that for a
period of 120 days from the date of this Agreement the Company
will not, except for grants or issuances by the Company of
stock options pursuant to its stock option plans and issuances
by the Company of Common Stock upon the exercise of stock
options and warrants previously granted by the Company or upon
the exchange of outstanding equity interests in certain
Partnership Subsidiaries, without the Placement Agent's prior
written consent, sell, or otherwise dispose of, directly or
indirectly, any shares of Common Stock (or any securities
convertible into or exchangeable for any shares of Common
Stock or any rights to purchase or acquire shares of Common
Stock) has been duly and validly executed and delivered by the
Company and constitutes the legal, valid and binding
obligation of the Company enforceable against the Company in
accordance with its terms, except as the enforceability
thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general
equitable principles.
5.6.8 All necessary corporate action has been duly
and validly taken by the Company to authorize the execution,
delivery and performance of this Agreement and the Escrow
Agreement and the issuance and sale of the Shares.
5.6.9 Neither the execution, delivery and
performance of this Agreement or the Escrow Agreement by the
Company nor the consummation of any of the transactions
contemplated hereby or thereby (including, without limitation,
the issuance and sale by the Company of the Shares) will give
rise to a right to terminate or accelerate the due date of any
payment due under, or conflict with or result in the breach of
any term or provision of, or constitute a default (or any
event which with notice or lapse of time, or both, would
constitute a default) under, or require consent or waiver
under, or result in the execution or imposition of any lien,
charge or encumbrance upon any real properties or assets of
the Company or any of its subsidiaries pursuant to the terms
of any indenture, mortgage, deed of trust, note, franchise,
license, permit, or other agreement or instrument known to
such counsel and to which the Company or any of its
subsidiaries is a party or by which it or any of their
respective real properties or businesses is bound, or any
judgment, decree, order, statute, rule or regulation
applicable to the business or assets of the Company or any of
its subsidiaries (other than blue sky) or violate any
provision of their respective
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charters, by-laws, partnership agreements or limited liability
company agreements.
5.6.10 No consent, approval, authorization or order
of any court or governmental agency or body is required for
the performance by the Company of this Agreement or the Escrow
Agreement or the consummation of the transactions contemplated
hereby or thereby, except such as have been obtained under the
Securities Act and from the NASD and such as may be required
under state securities laws in connection with the purchase
and distribution of the Shares by the Placement Agent (as to
which such counsel need express no opinion).
5.6.11 To such counsel's knowledge, there is no
litigation or governmental or other proceeding or
investigation, before any court or before or by any public
body or board pending against the Company or any of its
subsidiaries which would have a material adverse effect upon
the assets or real properties, business, results of
operations, prospects or condition (financial or otherwise) of
the Company and its subsidiaries considered as one enterprise.
5.6.12 The Registration Statement, the Prospectus,
each of the documents incorporated by reference in the
Prospectus at the time filed and each amendment or supplement
thereto (except for the financial statements and notes and
schedules and other financial and statistical information
included or incorporated by reference therein, as to which
such counsel expresses no opinion) comply as to form in all
material respects with the requirements of the Securities Act
and the Rules and the Exchange Act and the rules and
regulations of the Commission thereunder, as the case may be.
5.6.13 The Registration Statement has become
effective under the Securities Act, and, to the best of such
counsel's knowledge, no stop order suspending the
effectiveness of the Registration Statement has been issued
and no proceedings for that purpose have been instituted or
are threatened or pending.
5.6.14 The Company is not an "investment company"
within the meaning of the Investment Company Act of 1940, as
amended.
To the extent deemed advisable by such counsel, they may rely
as to matters of fact on certificates of responsible officers of the
Company and public officials and on the opinions of other counsel
satisfactory to the Placement Agent as to matters which are governed
by laws other than the laws of the State of Illinois, the laws of the
State of New York, the General Corporation Law of the State of
Delaware and the federal laws of the United States; provided, however,
that such counsel shall state that in their opinion that they believe
the Placement Agent and they are justified in relying on such other
opinions. Copies of such certificates and other opinions shall be
furnished to the Placement Agent and counsel for the Placement Agent.
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In addition, such counsel shall state that such counsel has
participated in conferences with officers and other representatives of
the Company, representatives of the Placement Agent and
representatives of the independent certified public accountants of the
Company, at which conferences the contents of the Registration
Statement and the Prospectus and related matters were discussed and,
although such counsel is not passing upon and does not assume any
responsibility for the accuracy, completeness or fairness of the
statements contained or incorporated by reference in the Registration
Statement and the Prospectus, on the basis of the foregoing, no facts
have come to the attention of such counsel which cause such counsel to
believe that (i) the Registration Statement or any post-effective
amendment thereto at the time it became effective contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and (ii) the Prospectus as of its date, on the
date any amendment or supplement to the Prospectus is filed with the
Commission and on the Closing Date contained any untrue statement of a
material fact or omitted to state a material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading (it being understood that
such counsel need not express any belief with respect to the financial
statements and schedules and other financial and statistical
information included or incorporated by reference in the Registration
Statement or the Prospectus).
5.7 All proceedings taken in connection with the sale of
the Shares as herein contemplated shall be reasonably satisfactory in
form and substance to the Placement Agent and its counsel and the
Placement Agent shall have received from Xxxxxx & Xxxxx a favorable
opinion, addressed to the Placement Agent and dated the Closing Date,
with respect to the Shares, the Registration Statement and the
Prospectus, and such other related matters, as the Placement Agent may
reasonably request, and the Company shall have furnished to Xxxxxx &
Xxxxx such documents as they may reasonably request for the purpose of
enabling them to pass upon such matters.
5.8 The Placement Agent shall have received on the
Closing Date a certificate, including exhibits thereto, addressed to
the Placement Agent and dated on the Closing Date, of the Secretary or
an Assistant Secretary of the Company, signed in such officer's
capacity as such officer, as to the (i) certificate of incorporation
and by-laws of the Company; (ii) resolutions authorizing the execution
and delivery of the Registration Statement, this Agreement, the Escrow
Agreement and the performance of the transactions contemplated by this
Agreement, the Escrow Agreement, the Registration Statement, the
Prospectus and the Offering; and (iii) incumbency of the person or
persons authorized to execute and deliver the Registration Statement,
this Agreement, the Escrow Agreement and any other documents
contemplated by the Offering.
5.9 The Placement Agent shall have received on the
Closing Date certificates of the Secretaries of State (or comparable
officials) where each of the Company, the Corporate Subsidiaries, the
Partnership Subsidiaries and the Limited Liability Subsidiaries are
incorporated or organized (as the case may be) and those states listed
in Schedules I, II, III and V, as to the good standing of each of the
foregoing entities. In addition, the Placement Agent shall have
received on the Closing Date a certificate, dated
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such Closing Date, of an executive officer of the Company to the
effect that the signer of such certificate has reviewed and
understands the provisions of Section 517.075 of the Florida Statutes,
and represents that the Company has complied, and at all times will
comply, with all provisions of Section 517.075 and further, that as of
the Closing Date, neither the Company nor any of its affiliates does
business with the government of Cuba or with any person or affiliate
located in Cuba.
5.10 The Placement Agent shall have received on the
Effective Date from the Company and each of its executive officers and
directors their enforceable written agreement that, for a period of
120 days after the date of this Agreement, each such party will not,
except for grants or issuances by the Company of stock options
pursuant to its stock option plans, and transfers to the Company of
Common Stock in payment for any indebtedness collaterized by such
Common Stock issuances by the Company of Common Stock upon the
exercise of stock options and warrants previously granted by the
Company or upon the exchange of outstanding equity interests in
certain Partnership Subsidiaries and transfers to the Company of
Common Stock in payment for any indebtedness collaterized by such
Common Stock, without the prior written consent of the Placement
Agent, sell, or otherwise dispose of, directly or indirectly, or
exercise any registration rights with respect to, any shares of Common
Stock (or any securities convertible into or exchangeable for any
shares of Common Stock or any rights to purchase or acquire shares of
Common Stock) owned by them.
5.11 The Placement Agent and the Company shall have
received on or prior to the Closing Date the written notification of
the Escrow Agent that the Requisite Funds have been deposited in the
Escrow Account.
6. Covenants of the Company.
6.1 The Company covenants and agrees as follows:
6.1.1 The Company shall prepare the Prospectus in a
form approved by the Placement Agent and file the Prospectus
pursuant to Rule 424(b) under the Securities Act not later
than the Commission's close of business on the second business
day following the execution and delivery of this Agreement,
or, if applicable, such earlier time as may be required by
Rule 430A(a)(3) under the Securities Act, and shall promptly
advise the Placement Agent (i) when any amendment to the
Registration Statement shall have become effective; (ii) of
any request by the Commission for any amendment of the
Registration Statement or the Prospectus or for any additional
information; (iii) of the prevention or suspension of the use
of any preliminary prospectus or the Prospectus or of the
issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or the institution
or threatening of any proceeding for that purpose; and (iv) of
the receipt by the Company of any notification with respect to
the suspension of the qualification of the Shares for sale in
any jurisdiction or the initiation or threatening of any
proceeding for such purpose. The Company shall not file any
amendment of the Registration Statement or amendment or
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supplement to the Prospectus unless the Company has furnished
the Placement Agent a copy for its review prior to filing and
shall not file any such proposed amendment or supplement
to which the Placement Agent reasonably objects. The Company
shall use every reasonable effort to prevent the issuance of
any such stop order and, if issued, to obtain as soon as
possible the withdrawal thereof.
6.1.2 If, at any time when a prospectus relating to
the Shares is required to be delivered under the Securities
Act and the Rules, any event occurs as a result of which the
Prospectus as then amended or supplemented would include any
untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not
misleading, or if it shall be necessary to amend or supplement
the Prospectus to comply with the Securities Act or the Rules,
the Company promptly shall prepare and file with the
Commission, subject to the second sentence of Section 6.1.1,
an amendment or supplement which shall correct such statement
or omission or an amendment which shall effect such
compliance.
6.1.3 The Company shall make generally available to
its security holders and to the Placement Agent as soon as
practicable, but not later than 90 days after the end of the
12-month period beginning at the end of the fiscal quarter of
the Company during which the Effective Date occurs, an
earnings statement (which need not be audited) of the Company,
covering such 12-month period, which shall satisfy the
provisions of Section 11(a) of the Securities Act or Rule 158
of the Rules.
6.1.4 The Company shall furnish to the Placement
Agent and counsel for the Placement Agent, without charge,
signed copies of the Registration Statement (including all
exhibits thereto and amendments thereof) and all amendments
thereof and, so long as delivery of a prospectus by a
Placement Agent or dealer may be required by the Securities
Act or the Rules, as many copies of any preliminary prospectus
and the Prospectus and any amendments thereof and supplements
thereto as the Placement Agent may reasonably request.
6.1.5 The Company shall cooperate with the
Placement Agent and counsel for the Placement Agent in
endeavoring to qualify the Shares for offer and sale under the
laws of such jurisdictions as the Placement Agent may
designate and shall maintain such qualifications in effect so
long as required for the distribution of the Shares; provided,
however, that the Company shall not be required in connection
therewith, or as a condition thereof, to qualify as a foreign
corporation or to execute a general consent to service of
process in any jurisdiction or subject itself to taxation as
doing business in any jurisdiction.
6.1.6 For a period of five years after the date of
this Agreement, the Company shall supply to the Placement
Agent copies of such financial statements and other periodic
and special reports as the Company may from time to time
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distribute generally to the holders of any class of its
capital stock and furnish to the Placement Agent a copy of
each annual or other report it shall be required to file with
the Commission.
6.1.7 Without the prior written consent of the
Placement Agent, for a period of 120 days after the date of
this Agreement, the Company shall not, directly or indirectly,
issue, offer, sell or register with the Commission, or
otherwise encumber or dispose of, directly or indirectly, any
equity securities of the Company (or any securities
convertible into or exercisable or exchangeable for equity
securities of the Company), except for (i) the issuance of the
Shares pursuant to the Registration Statement; (ii) the grant
or issuance of stock options pursuant to the Company's stock
option plans; (iii) the issuance of Common Stock pursuant to
the exercise of outstanding stock options or warrants
previously granted by the Company; or (iv) the issuance of
Common Stock pursuant to the exchange of outstanding equity
interests in certain Partnership Subsidiaries.
6.2 The Company agrees to pay, or reimburse if paid by
the Placement Agent, whether or not the transactions contemplated
hereby are consummated or this Agreement is terminated, all costs and
expenses incident to the Offering and the performance of the
obligations of the Company under this Agreement, including, but not
limited to, those relating to: (i) the preparation, printing, filing
and distribution of the Registration Statement including all exhibits
thereto, each preliminary prospectus, the Prospectus, all amendments
and supplements to the Registration Statement and the Prospectus, and
the printing, filing and distribution of this Agreement; (ii) the
preparation and delivery of certificates for the Shares to the
Placement Agent; (iii) the registration or qualification of the Shares
for offer and sale under the securities laws of the various
jurisdictions referred to in Section 6.1.5, including the reasonable
fees and disbursements of counsel for the Placement Agent in
connection with such registration and qualification and the
preparation, printing, distribution and shipment of preliminary and
supplementary securities memoranda; (iv) the furnishing (including
cost of shipping and mailing) to the Placement Agent of copies of each
preliminary prospectus, the Prospectus and all amendments or
supplements to the Prospectus, and of the several documents required
by this Section to be so furnished, as may be reasonably requested for
use in connection with the Offering and the sale of the Shares by the
Placement Agent; (v) the filing fees of the NASD in connection with
its review of the terms of the Offering; (vi) the furnishing
(including costs of shipping and mailing) to the Placement Agent of
copies of all reports and information required by Section 6.1.6; (vii)
inclusion of the Shares for quotation on the Nasdaq National Market;
(viii) all transfer taxes, if any, with respect to the sale and
delivery of the Shares by the Company; and (ix) the fees of the Escrow
Agent. In addition, on the Closing Date, the Company shall pay the
Placement Agent $________ for non-accountable expenses incurred in
connection with the Offering.
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7. Indemnification.
7.1 The Company agrees to indemnify and hold harmless the
Placement Agent and each person, if any, who controls the Placement
Agent within the meaning of Section 15 of the Securities Act or
Section 20 of the Exchange Act against any and all losses, claims,
damages and liabilities, joint or several (including any reasonable
investigation, legal and other expenses incurred in connection with,
and any amount paid in settlement of, any action, suit or proceeding
or any claim asserted), to which they, or any of them, may become
subject under the Securities Act, the Exchange Act or other federal or
state law or regulation, at common law or otherwise, insofar as such
claims, damages or liabilities arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact
contained in any preliminary prospectus, the Registration Statement or
the Prospectus or any amendment thereof or supplement thereto, or
arise out of or are based upon any omission or alleged omission to
state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that such indemnity shall not inure to the benefit of the
Placement Agent (or any person controlling the Placement Agent) on
account of any losses, claims, damages or liabilities arising from the
sale of the Shares to any person by the Placement Agent if such untrue
statement or omission or alleged untrue statement or omission was made
in such preliminary prospectus, the Registration Statement or the
Prospectus, or such amendment or supplement, in reliance upon and in
conformity with information furnished in writing to the Company by the
Placement Agent specifically for use therein. This indemnity
agreement will be in addition to any liability which the Company may
otherwise have.
7.2 The Placement Agent agrees to indemnify and hold
harmless the Company, each person, if any, who controls the Company
within the meaning of Section 15 of the Securities Act or Section 20
of the Exchange Act, each director of the Company, and each officer of
the Company who signs the Registration Statement, to the same extent
as the foregoing indemnity from the Company to the Placement Agent,
but only insofar as such losses, claims, damages or liabilities arise
out of or are based upon any untrue statement or omission or alleged
untrue statement or omission which was made in any preliminary
prospectus, the Registration Statement or the Prospectus, or any
amendment thereof or supplement thereto, contained in the paragraphs
relating to stabilization on the inside front cover page of the
Prospectus and the statements contained under the caption "Plan of
Distribution" in the Prospectus; provided, however, that the
obligation of the Placement Agent to indemnify the Company
(including any controlling person, director or officer thereof) shall
be limited to the net proceeds received by the Company from the
Offering.
7.3 Any party that proposes to assert the right to be
indemnified under this Section will, promptly after receipt of notice
of commencement of any action, suit or proceeding against such party
in respect of which a claim is to be made against an indemnifying
party or parties under this Section, notify each such indemnifying
party of the commencement of such action, suit or proceeding,
enclosing a copy of all papers served. No indemnification provided
for in Section 7.1 or 7.2 shall be available to any
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party who shall fail to give notice as provided in this Section 7.3 if
the party to whom notice was not given was unaware of the proceeding
to which such notice would have related and was prejudiced by the
failure to give such notice but the omission so to notify such
indemnifying party of any such action, suit or proceeding shall not
relieve it from any liability that it may have to any indemnified
party for contribution or otherwise than under this Section. In case
any such action, suit or proceeding shall be brought against any
indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to
participate in, and, to the extent that it shall wish, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof, with counsel reasonably satisfactory to such indemnified
party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof and
the approval by the indemnified party of such counsel, the
indemnifying party shall not be liable to such indemnified party for
any legal or other expenses, except as provided below and except for
the reasonable costs of investigation subsequently incurred by such
indemnified party in connection with the defense thereof. The
indemnified party shall have the right to employ its counsel in any
such action, but the fees and expenses of such counsel shall be at the
expense of such indemnified party unless (i) the employment of counsel
by such indemnified party has been authorized in writing by the
indemnifying parties, (ii) the indemnified party shall have reasonably
concluded that there may be a conflict of interest between the
indemnifying parties and the indemnified party in the conduct of the
defense of such action (in which case the indemnifying parties shall
not have the right to direct the defense of such action on behalf of
the indemnified party) or (iii) the indemnifying parties shall not
have employed counsel to assume the defense of such action within a
reasonable time after notice of the commencement thereof, in each of
which cases the fees and expenses of counsel shall be at the expense
of the indemnifying parties. An indemnifying party shall not be
liable for any settlement of any action, suit, proceeding or claim
effected without its written consent.
8. Contribution. In order to provide for just and
equitable contribution in circumstances in which the indemnification provided
for in Section 7.1 is due in accordance with its terms but for any reason is
held to be unavailable from the Company, the Company and the Placement Agent
shall contribute to the aggregate losses, claims, damages and liabilities
(including any investigation, legal and other expenses reasonably incurred in
connection with, and any amount paid in settlement of, any action, suit or
proceeding or any claims asserted, but after deducting any contribution
received by the Company from persons other than the Placement Agent, such as
persons who control the Company within the meaning of the Securities Act,
officers of the Company who signed the Registration Statement and directors of
the Company, who may also be liable for contribution) to which the Company and
the Placement Agent may be subject in such proportion as is appropriate to
reflect the relative benefits received by the Company on the one hand and the
Placement Agent on the other from the Offering or, if such allocation is not
permitted by applicable law or indemnification is not available as a result of
the indemnifying party not having received notice as provided in Section 7
hereof, in such proportion as is appropriate to reflect not only the relative
benefits referred to above but also the relative fault of the Company on the
one hand and the Placement Agent on the other in connection with the statements
or omissions which resulted in such losses, claims, damages,
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liabilities or expenses, as well as any other relevant equitable
considerations. The relative benefits received by the Company and the
Placement Agent shall be deemed to be in the same proportion as (i) the total
proceeds from the Offering (net of the placement fee but before deducting
expenses) received by the Company, as set forth in the table on the cover page
of the Prospectus, bear to (ii) the placement fee received by the Placement
Agent, as set forth in the table on the cover page of the Prospectus. The
relative fault of the Company or the Placement Agent shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact related to information supplied by the Company or
the Placement Agent and the parties' relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.
The Company and the Placement Agent agree that it would not be just and
equitable if contribution pursuant to this Section 8 were determined by pro
rata allocation or by any other method of allocation which does not take
account of the equitable considerations referred to above. Notwithstanding the
provisions of this Section 8, (i) in no case shall the Placement Agent be
liable or responsible for any amount in excess of the placement fee received by
it in connection with the Offering and (ii) the Company shall be liable and
responsible for any amount in excess of such placement fee; provided, however,
that no person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation. For purposes
of this Section 8, each person, if any, who controls the Placement Agent within
the meaning of Section 15 of the Securities Act or Section 20(a) of the
Exchange Act shall have the same rights to contribution as the Placement Agent,
and each person, if any, who controls the Company within the meaning of Section
15 of the Securities Act or Section 20(a) of the Exchange Act, each officer of
the Company who shall have signed the Registration Statement and each director
of the Company (including the director nominee) shall have the same rights to
contribution as the Company, subject in each case to clauses (i) and (ii) in
the immediately preceding sentence of this Section 8. Any party entitled to
contribution will, promptly after receipt of notice of commencement of any
action, suit or proceeding against such party in respect of which a claim for
contribution may be made against another party or parties under this Section,
notify such party or parties from whom contribution may be sought, but the
omission so to notify such party or parties from whom contribution may be
sought shall not relieve the party or parties from whom contribution may be
sought from any other obligation it or they may have hereunder or otherwise
than under this Section. No party shall be liable for contribution with
respect to any action, suit, proceeding or claim settled without its written
consent.
9. Termination.
9.1 This Agreement may be terminated with respect to the
Offering by the Placement Agent by notifying the Company at any time,
(i) in the absolute discretion of the Placement
Agent at or before the Closing Date: (a) if on or prior to
such date, any domestic or international event or act or
occurrence has materially disrupted, or in the opinion of the
Placement Agent will in the future materially disrupt, the
securities markets; (b) if there has occurred any new outbreak
or material escalation of hostilities or other calamity or
crisis the effect of which on the financial markets of the
United
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States is such as to make it, in the judgment of the Placement
Agent, inadvisable to proceed with the Offering; (c) if there
shall be such a material adverse change in general financial,
political or economic conditions or the effect of
international conditions on the financial markets in the
United States is such as to make it, in the judgment of the
Placement Agent, inadvisable or impracticable to market the
Shares; (d) if trading in the Shares has been suspended by the
Commission or trading generally on the New York Stock
Exchange, Inc. or on the American Stock Exchange, Inc. has
been suspended or limited, or minimum or maximum ranges for
prices for securities shall have been fixed, or maximum ranges
for prices for securities have been required, by said
exchanges or by order of the Commission, the NASD, or any
other governmental or regulatory authority; or (e) if a
banking moratorium has been declared by any state or federal
authority, or
(ii) at the Closing Date, that any of the
conditions specified in Section 5 shall not have been
fulfilled when and as required by this Agreement.
9.2 If this Agreement is terminated pursuant to any of
its provisions, the Company shall not be under any liability to the
Placement Agent, and the Placement Agent shall not be under any
liability to the Company, except that if this Agreement is terminated
by the Placement Agent because of any failure, refusal or inability on
the part of the Company to comply with the terms or to fulfill any of
the conditions of this Agreement, the Company will reimburse the
Placement Agent for all out-of-pocket expenses (including the
reasonable fees and disbursements of its counsel up to $____________)
incurred by it in connection with the proposed purchase and sale of
the Shares or in contemplation of performing their obligations
hereunder.
9.3 If this Agreement is terminated pursuant to any of
its provisions, then all funds deposited in the Escrow Account shall
be returned promptly to the Investors. In the event the Closing does
not take place within 120 days of the Effective Date, this Agreement
shall automatically terminate, and all funds deposited into the Escrow
Account by the Investors shall be promptly returned to such Investors.
10. Miscellaneous. The respective agreements,
representations, warranties, indemnities and other statements of the Company or
its officers and of the Placement Agent set forth in or made pursuant to this
Agreement shall remain in full force and effect, regardless of any
indemnification made by or on behalf of the Placement Agent or the Company or
any of the officers, directors or controlling persons referred to in Sections 7
and 8 hereof, and shall survive the Closing. The provisions of Sections 6.2,
7, 8 and 9 shall survive the termination or cancellation of this Agreement.
This Agreement has been and is made for the benefit of the
Placement Agent and the Company and their respective successors and assigns,
and, to the extent expressed herein, for the benefit of persons controlling the
Placement Agent or the Company, and directors and officers of the Company, and
their respective successors and assigns, and no other person shall acquire or
have any right under or by virtue of this Agreement. The term "successors and
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25
assigns" shall not include any purchaser of Shares from the Placement Agent
merely because of such purchase.
All notices and communications hereunder shall be in writing
and mailed or delivered or by telephone or telegraph if subsequently confirmed
in writing, (a) if to the Placement Agent, c/o Oppenheimer & Co., Inc.,
Xxxxxxxxxxx Xxxxx, Xxxxx Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx 00000,
Attention: Xxxxxxx Xxxxx, and (b) if to the Company, to its agent for service
as such agent's address appears on the cover page of the Registration
Statement.
This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to principles
of conflict of laws.
This Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument.
Please confirm that the foregoing correctly sets forth the
agreement among us.
Very truly yours,
AMERIHOST PROPERTIES, INC.
By
-------------------------------
Name:
Title:
Confirmed:
PLACEMENT AGENT
By: XXXXXXXXXXX & CO., INC.
By
------------------------------
Name:
Title:
25
26
SCHEDULE I
LIST OF CORPORATE SUBSIDIARIES OF THE COMPANY
Amerihost Development, Inc.
AmeriHost Inns of Illinois, Inc.
AmeriHost Inns of Michigan, Inc.
AmeriHost Inns of Ohio, Inc.
Amerihost International, Inc.
Amerihost Lodging Group, Inc.
Amerihost Management, Inc.
Amerihost Renovations, Inc.
Amerihost Staffing, Inc.
AP Equities of Arkansas, Inc.
AP Equities of Florida, Inc.
A.P. Equities of Indiana, Inc.
AP Equities of Ohio, Inc.
AP Hotels of California, Inc.
AP Hotels of Georgia, Inc.
AP Hotels of Illinois, Inc.
AP Hotels of Iowa, Inc.
AP Hotels of Kansas, Inc.
AP Hotels of Kentucky, Inc.
AP Hotels of Michigan, Inc.
AP Hotels of Mississippi, Inc.
AP Hotels of Missouri, Inc.
AP Hotels of Ohio, Inc.
AP Hotels of Pennsylvania, Inc.
AP Hotels of Texas, Inc.
AP Hotels of Vermont, Inc. (DE)
AP Hotels of Vermont, Inc. (VT)
AP Hotels of West Virginia, Inc.
AP Hotels of Wisconsin, Inc.
AP Lodging of Ohio, Inc.
AP Properties of Ohio, Inc.
API/Cloverdale, Inc.
API/Crawfordsville, Inc.
API/Marysville, Inc.
API/Plainfield, Inc.
API of Indiana, Inc.
API of Wisconsin, Inc.
Hammond Investors, Inc.
Niles, Illinois Hotel Corporation
Schiller Park Investors, Inc.
Shorewood Hotel Investments, Inc.
Shorewood Investors, Inc.
27
SCHEDULE II
LIST OF PARTNERSHIP SUBSIDIARIES OF THE COMPANY
Allen, TX 000 Xxxxxxx Xxxxxxxxxxx
Xxxxxxx, XX 792 Limited Partnership
Amerihost De Mexico, S.A.
Amerihost Inn Hotel Investors L.P.I
Ann Arbor, MI 193 Limited Partnership
Athens Motel Association Limited Partnership
Athens Motel Association Limited Partnership II
Batesville, MS 595 Limited Partnership
Bowling Green, OH 590 Limited Partnership
Cloverdale, IN 588-1 Partnership (GP)
Crawfordsville, IN 888-2 Partnership (GP)
Xxxxxx, XX 0000 Limited Partnership
Delaware, OH 296 Limited Partnership
Elk Grove, IL 1292 General Partnership (GP)
Euless, TX 1192 General Partnership (GP)
Findlay, OH 000 Xxxxxxx Xxxxxxxxxxx
Xxxx Xxxxx, XX 992 Limited Partnership
Grand Blanc, MI 000 Xxxxxxx Xxxxxxxxxxx
Xxxxx Xxxxxx, XX 896, Limited Partnership
Grove City, PA 896, L.P.
Hammond, IN 490 Partnership (GP)
Jacksonville, IL 000 Xxxxxxx Xxxxxxxxxxx
Xxxxxxx, XX 193 General Partnership (GP)
Kent 2-89 Partnership (GP)
Xxxxxx, XX 0000 Limited Partnership
Lancaster, OH 1191 Limited Partnership
Xxxxx, OH 692 Limited Partnership
Macomb, IL 000 Xxxxxxx Xxxxxxxxxxx
Xxxxxxxxx, XX 993 General Partnership (GP)
Marysville, OH 589-3 Partnership (GP)
Metropolis, IL 1292 Limited Partnership
Middletown, OH 592 Limited Partnership
Mineral Xxxxx, WVA 196 Limited Partnership
Monroe, MI 896, Limited Partnership
Mosinee Airport Inn General Partnership (GP)
Murray, KY 695 Limited Partnership
New Martinsville, WVA 695 Limited Partnership
New Philadelphia, OH 1092 Limited Partnership
Niles 1290 Hotel Partnership (GP)
Oil City, PA 1192 Limited Partnership
Plainfield, IN 989-4 Partnership (GP)
Plainfield II IN 192-5 Partnership (GP)
00
Xxxx Xxxxx, XX 896, Limited Partnership
Portage 691 Limited Partnership
San Marcos, TX 896 X.X.
Xxxxxxxx Park 1288 Limited Partnership
Shorewood 689 Limited Partnership
Xxxxxxxx Motel Associates, Ltd.
Tuscola, IL 593 Limited Partnership
Vicksburg, MS 694-711 Partnership (GP)
Washington C.H., OH 194 Limited Partnership
White River Junction, VT 000 Xxxxxxx Xxxxxxxxxxx
Xxxxxxxxxx, XX 695 Limited Partnership
Zanesville, OH 1190 Partnership (GP)
29
SCHEDULE III
LIST OF LIMITED LIABILITY SUBSIDIARIES OF THE COMPANY
Ashland, OH 1095 Ltd.
AMALP II 696 Ltd.
Effingham, IL 796 L.L.C.
Xxxxx Xxx, XX 0000 X.X.X.
Xxxxx Xxxx, XX 696 LLC
Xxxxxxx Hotel L.L.C.
Jeffersonville, OH 695 Ltd.
Xxxxxxxx, MI 196 L.L.C.
Muskegon, MI 596 L.L.C.
30
SCHEDULE IV
LIST OF CERTAIN PROPERTIES SUBJECT TO PHASE I ENVIRONMENTAL SURVEYS
31
SCHEDULE V
LIST OF FOREIGN JURISDICTIONS OF THE COMPANY
