LIMITED GUARANTY
EXHIBIT
99.15
THIS
LIMITED GUARANTY (this “Guaranty”)
is
made as of February 9, 2007, by each of Kingdom Hotels International, a Cayman
Islands company (“Kingdom”),
and
Cascade Investment, L.L.C., a Washington limited liability company
(“Cascade”),
in
favor of Four Seasons Hotels Inc., a corporation incorporated under the laws
of
the Province of Ontario (the “Company”).
Each
of Kingdom and Cascade shall be referred to herein individually as a
“Guarantor,”
and,
together, as the “Guarantors.”
With
respect to each Guarantor, the other Guarantor hereunder shall be referred
to as
the “Other
Guarantor.”
For
value
received, and to induce the Company to enter into the Acquisition Agreement,
of
even date herewith, between the Company and FS Acquisition Corp. (the
“Purchaser”)
(together with any subsequent modification or supplement thereto, the
“Acquisition
Agreement”),
each
of the Guarantors, severally and not jointly, hereby unconditionally and
irrevocably guarantees, as primary obligor and not merely as surety, the prompt
and complete payment when due of the payment obligations of Purchaser (if any),
or any of its successors or assigns, that arises under or in connection with
Section 7.3(3) of the Acquisition Agreement from time to time (the “Obligations”)
less
the amount of any Obligations that the Company actually has recovered from
the
Purchaser, up to an aggregate amount as follows: (i)
with
respect to Kingdom, US$50,000,000 (such amount, the “Kingdom
Cap”)
and
(ii) with respect to Cascade, US$50,000,000 (such amount, the “Cascade
Cap”).
This
Guaranty is an absolute, unconditional, irrevocable and continuing guarantee
of
the full and punctual payment of the Obligations, with respect to Kingdom up
to
the Kingdom Cap, and with respect to Cascade up to the Cascade Cap, and not
of
their collectibility only, and is in no way conditioned upon any requirement
that the Company first attempt to collect the Obligations from Purchaser or
the
Other Guarantor or resort to any security or other means of collecting payment.
Should Purchaser not have made the payment of any Obligations which may be
due
and owing under the Acquisition Agreement and the Acquisition Agreement shall
have been terminated, the Guarantors’ obligations hereunder, with respect to
Kingdom up to the Kingdom Cap, and with respect to Cascade up to the Cascade
Cap, shall become immediately due and payable to the Company. The failure by
one
or more Guarantors to satisfy its obligations hereunder shall not relieve the
Other Guarantor of its obligations hereunder.
Each
Guarantor hereby waives promptness, diligence, notice of acceptance of this
Guaranty and notice of the Obligations, and waives presentment, demand for
payment, protest, notice of dishonor or non-payment of the Obligations, notice
of acceleration or intent to accelerate the Obligations, and any other notice
to
such Guarantor, and the Company is not obligated to file any suit or take any
action, or provide any notice to, Purchaser, the Guarantors, or others, except
as expressly provided in the Acquisition Agreement or in this Guaranty. Without
limiting the generality of the foregoing, each Guarantor agrees that the
obligation of such Guarantor hereunder shall not be released or discharged,
in
whole or in part, or otherwise affected by: (i) the failure of the Company
to
assert any claim or demand or to enforce any right or remedy against Purchaser
or the Other Guarantor or any other person or entity with respect to the
Obligations; (ii) any extensions or renewals of the Obligations; (iii) any
rescissions, waivers, supplements or modifications of the Acquisition Agreement;
(iv) the adequacy of any means available to the Company to claim payment of
the
Obligations; (v) the existence of any claim, set-off or other right which the
Guarantors may have at any time against the Purchaser, the Other Guarantor
or
the Company; (vi) any insolvency, bankruptcy, reorganization or other similar
proceeding affecting Purchaser, the Other Guarantor or the Company or any other
person or entity; (vii) any change in the corporate existence, structure or
ownership of Purchaser, the Other Guarantor or the Company or any other person
or entity; (viii) any and all rights or defenses arising by reason of any law
which would otherwise require any election of remedies by the Company or (ix)
any other act or omission that might in any way or to any extent vary the risk
of a Guarantor or otherwise operate as a release or discharge or suretyship
defense of a Guarantor, all of which actions or omissions may be done without
notice to the Guarantors. However, each Guarantor reserves the right to assert
defenses that Purchaser may have to payment of the Obligations arising under
the
Acquisition Agreement, it being understood and agreed that all references to
defenses arising under the Acquisition Agreement shall exclude such defenses
as
those arising from the bankruptcy, insolvency or similar rights of Purchaser,
or
defenses related to Purchaser’s capacity or ability to enter into or perform its
obligations under the Acquisition Agreement, or defenses related to the
enforceability of the Acquisition Agreement against Purchaser.
If
Purchaser has not made payment of any Obligations which may be due and owing,
and the Acquisition Agreement has been terminated, the Guarantors shall make
such payment or otherwise cause such payment, with respect to Kingdom up to
the
Kingdom Cap, and with respect to Cascade up to the Cascade Cap, to be made
within ten (10) business days after the receipt by the Guarantors of written
notice from the Company that such payment is due and owing under the Acquisition
Agreement (to the extent not previously paid under the Acquisition Agreement).
A
payment demand shall be in writing and shall reasonably and briefly specify
what
amount Purchaser has failed to pay, with a specific statement that the Company
is calling upon the Guarantors to pay under this Guaranty. No such notice,
demand or explanation shall be required as against a Guarantor which shall
at
the time that any Obligations are due and owing under the Acquisition Agreement
be subject to bankruptcy or insolvency proceedings, and all of the obligations
of such Guarantor hereunder shall be immediately and automatically due and
payable without notice or demand of any kind at such time as any Obligations
are
due and owing under the Acquisition Agreement.
The
obligation of each Guarantor hereunder is limited to its guarantee of the
Obligations (if any) under the Acquisition Agreement and shall in no way require
the payment by a Guarantor of an amount in excess of the Kingdom Cap (with
respect to Kingdom), and the Cascade Cap (with respect to Cascade), as provided
above in the second paragraph of this Guaranty. All sums payable by the
Guarantors hereunder shall be made in immediately available funds. The Company
acknowledges that payment by the Guarantors of the amounts contemplated hereby
shall constitute satisfaction in full of each Guarantor’s liability with respect
to the Obligations. Upon payment of the Obligations owing to the Company, each
Guarantor shall be subrogated to the rights of the Company against Purchaser
in
respect of such payment. However, no Guarantor may exercise any right of
subrogation as to Purchaser until the Obligations have been satisfied in full
or
seek any recovery from the Other Guarantor in respect of payments made hereunder
until the Obligations have been satisfied in full or have been paid up to the
Kingdom Cap and the Cascade Cap.
The
Company’s remedies against the undersigned hereunder shall be, and are intended
to be, the sole and exclusive direct or indirect remedies available to the
Company against the Guarantors and any former, current or future director,
officer, employee, agent, general or limited partner, manager, member,
stockholder or affiliate (other than Purchaser or the Other Guarantor) of the
Guarantors or their members or any former, current or future director, officer,
employee, agent, general or limited partner, manager, member, stockholder,
affiliate (other than Purchaser or the Other Guarantor) of any of the foregoing
(collectively, the “Non-Recourse
Parties”)
in
respect of any liabilities or obligations arising under, or in connection with,
the Acquisition Agreement, the Equity Funding Letter (as defined in the
Acquisition Agreement), the Voting Agreement or the transactions contemplated
thereby, including in the event Purchaser breaches its obligations under the
Acquisition Agreement or in the event Guarantor breaches a representation or
warranty hereunder. The obligations of the Guarantors hereunder shall bind
any
successor and any transferee of any material part of the assets of such
Guarantor, but shall not be assignable or delegable except with the prior
written consent of the other parties, and the original Guarantor shall in all
events remain liable notwithstanding any merger, consolidation or transfer
of
assets.
The
Company covenants and agrees that it shall not institute, directly or
indirectly, and shall cause its subsidiaries and affiliates not to institute,
any proceeding or bring any other claim arising under, or in connection with,
the Acquisition Agreement, the Equity Funding Letter, the Voting Agreement
or
the transactions contemplated thereby against the Guarantors or any
Non-Recourse Party, except
for claims against the Guarantors under this Guaranty (subject to the
limitations described herein). The Company acknowledges that the sole asset
of
the Purchaser is US$1,000.00, and that no additional funds are expected to
be
contributed to the Purchaser unless and until the Effective Time occurs. By
its
acceptance of the benefits of this Limited Guaranty, the Company acknowledges
and agrees that it has no right of recovery against, and no personal liability
shall attach to, any Guarantor or any other Non-Recourse Party, through the
Purchaser or otherwise, whether by or through attempted piercing of the
corporate veil, by or through a claim by or on behalf of the Purchaser against
any Guarantor or other Non-Recourse Party, by the enforcement of any assessment
or by any legal or equitable proceeding, by virtue of any statute or regulation
or otherwise, in each case in respect of any liabilities or obligations arising
under, or in connection with, the Acquisition Agreement, the Equity Funding
Letter, the Voting Agreement or the transactions contemplated thereby, except
for the Company’s rights to recover from the Guarantors (but not any
Non-Recourse Party) under and to the extent provided in this Guaranty and
subject to the limitations described herein.
This
Guaranty shall terminate and be of no further force and effect and the Company
may not attempt to enforce any rights hereunder upon and after the earliest
to
occur of (i) the occurrence of the Effective Time (as such term is defined
in the Acquisition Agreement) and payment of all obligations due by Purchaser
under the Acquisition Agreement at such time; (ii) termination of the
Acquisition Agreement pursuant to Section 8.2 thereof under circumstances that
do not give rise to any payment obligation of the Purchaser pursuant to Section
7.3(3) thereof; provided, however, that this Guaranty shall not terminate under
this clause (ii) if the Company, acting reasonably, is contesting or disputing
such termination of the Acquisition Agreement in writing (or has asserted in
writing its intention to do so) and/or has made or has asserted in writing
its
intention to make a claim against the Purchaser and/or one or both of the
Guarantors that would give rise to a claim against the Guarantors under this
Guaranty; (iii) 365 days after any other termination of the Acquisition
Agreement unless prior thereto the Company has made a claim against the
Purchaser and/or one or both of the Guarantors under this Guaranty and
(iv) receipt in full by the Company of all amounts due by the Purchaser
under Section 7.3(3) of the Acquisition Agreement.
This
Guaranty shall be binding in all respects on the successors of the Guarantors
and their permitted assigns and shall inure to the benefit of the Company and
its permitted assigns. Neither of the Guarantors nor the Company may assign
its
respective rights or obligations hereunder without the prior written consent
of
the other parties hereto, which consent, in the case of the proposed assignment
by a Guarantor, may be withheld by the Company in its sole
discretion.
Nothing
set forth in this Guaranty shall confer or give or shall be construed to confer
or give to any person other than the Company (including any person acting in
a
representative capacity) any rights or remedies against any person including
a
Guarantor, except as expressly set forth herein.
The
parties hereto agree that this Guaranty shall be governed by and construed
in
accordance with the laws of the Province of Ontario and the laws of Canada
applicable thereto without giving effect to applicable principles of conflicts
of law to the extent that the application of another jurisdiction would be
required thereby.
Each
of
the parties hereby irrevocably attorns to the non-exclusive jurisdiction of
the
Courts of the Province of Ontario in respect of all matters arising under and
in
relation to this Guaranty. The Guarantors hereby appoint Stikeman Elliott LLP
(in the case of Kingdom) and XxXxxxxx Xxxxxxxx LLP (in the case of Cascade)
as
their agents for service of process or other purposes in connection with any
action or proceeding arising out of this Guaranty.
EACH
OF
THE PARTIES HERETO HEREBY WAIVES TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
LAW ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY WITH RESPECT TO ANY LITIGATION
DIRECTLY OR INDIRECTLY ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS GUARANTY
OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREBY.
Each
Guarantor hereby represents and warrants, as to itself and not as to the Other
Guarantor, that:
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(a)
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the
execution, delivery and performance by such Guarantor of this Guaranty
have been duly authorized by all necessary action and do not contravene
any provision of the charter, partnership agreement, operating agreement
or similar organizational documents of such Guarantor or any law,
regulation, rule, decree, order, judgment or contractual restriction
binding on such Guarantor or its
assets;
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(b)
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such
Guarantor has the financial capacity to pay and perform its obligations
under this Guaranty, and all funds necessary for such Guarantor to
fulfill
its obligations under this Guaranty shall be available to such Guarantor
for so long as this Guaranty shall remain in
effect;
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(c)
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this
Guaranty constitutes a legal, valid and binding obligation of such
Guarantor enforceable against such Guarantor in accordance with its
terms;
and
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(d)
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all
consents, approvals, authorizations, permits of, filings with and
notifications to any governmental authority necessary for the due
execution, delivery and performance of this Guaranty by such Guarantor
have been obtained or made and all conditions thereof have been duly
complied with, and no other action by, and no notice to or filing
with,
any governmental authority or regulatory body is required in connection
with the execution, delivery or performance of this
Guaranty.
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The
Guaranty shall continue to be effective or be reinstated, as the case may be,
if
at any time any payment of the Obligations is rescinded or must otherwise be
returned by the Company.
No
amendment or waiver of any provision of this Guaranty shall be effective unless
the same shall be in writing and signed by each Guarantor and the Company.
No
failure on the part of the Company to exercise, and no delay in exercising,
any
right hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise
thereof or the exercise of any other right.
This
Guaranty contains the entire agreement of the Guarantors with respect to the
matters set forth herein.
[Signature
page follows]
This
Guaranty may be executed in counterparts, all of which shall be considered
one
and the same agreement and shall become effective when one or more counterparts
have been signed by each of the parties and delivered to the other party.
Facsimile transmission of any signed original document shall be deemed the
same
as delivery of an original.
Guarantors:
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KINGDOM
HOTELS INTERNATIONAL, a Cayman Islands company
By:
/s/
Xxxxxxx X. Xxxxx
Its:
Authorized Signatory
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CASCADE
INVESTMENT, L.L.C., a Washington limited liability company
By:
/s/
Xxxxxxx Xxxxxx
Its:
Business Manager
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ACCEPTED
AND AGREED as of February
9, 2007
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Four
Seasons Hotels Inc.
By:
/s/ Xxxxxxxx
Xxxxxx
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/s/
Xxxxxxxx
Xxxxx
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Its:
President & C.O.O
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Executive
Vice President, General Counsel & Secretary
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