EXHIBIT 99.8
VOTING AGREEMENT
AND
IRREVOCABLE PROXY
This VOTING AGREEMENT AND IRREVOCABLE PROXY (this "Agreement"), dated as
of November 9, 2001, by and among Expedia, Inc., a Washington corporation
("Expedia" or the "Company"), Microsoft Corporation, a Washington corporation
("Microsoft"), Microsoft E-Holdings, Inc., a Nevada corporation ("E-Holdings";
Microsoft and E-Holdings are collectively referred to as "Stockholder") and for
purposes of Sections 7.2, 7.3 and 8 only, USA Networks, Inc. ("USA").
W I T N E S S E T H:
WHEREAS, USA, Expedia, Taipei, Inc., a wholly owned subsidiary of USA
("Merger Sub"), Microsoft and E-Holdings have entered into an Amended and
Restated Agreement and Plan of Recapitalization and Merger, dated as of July 15,
2001 (the "Merger Agreement"), providing for, among other things, the
Transactions on the terms and subject to the conditions set forth therein
(capitalized terms used herein and not otherwise defined shall have the meanings
ascribed to such terms in the Merger Agreement);
WHEREAS, as of the date hereof, Stockholder beneficially owns the number
of Voting Shares (as defined herein) set forth on Attachment A hereto (the
"Owned Shares");
WHEREAS, the Company intends to hold its annual meeting of shareholders in
November, 2001 for the purposes of, among other things, having such shareholders
consider and vote on a proposal (i) to approve the Merger Agreement, (ii) to
elect seven directors to serve on the Company's board of directors until the
2002 annual meeting of Expedia shareholders, and (iii) to adopt the Expedia,
Inc. 2001 Stock Plan and, in connection therewith, has filed a joint proxy
statement/prospectus on Form S-4 on August 22, 2001 (the "Expedia S-4"); and
WHEREAS, in connection with the Transactions, Stockholder has agreed to
vote all of the Owned Shares, together with any shares of Company Stock acquired
after the date of this Agreement, whether upon the exercise of options,
conversion of convertible securities or otherwise, and any other voting
securities of the Company (whether acquired heretofore or hereafter) that are
beneficially owned by Stockholder or over which Stockholder has, directly or
indirectly, the right to vote (collectively, the "Voting Shares"), in favor of
(i) the nominees to Expedia's board of directors proposed by the Company in
Proposal No. 4 included in Expedia's Registration Statement on Form S-4, filed
with the SEC on August 22, 2001, as thereafter amended (the "Expedia S-4"), and
(ii) the adoption of the Expedia, Inc. 2001 Stock Plan, adopted by the Company's
board of directors in August 2001, and proposed by the Company in Proposal No. 5
included in the Expedia S-4.
NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration given to each party hereto, the receipt and sufficiency
of which is hereby acknowledged, the parties agree as follows:
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1. AGREEMENT TO VOTE; IRREVOCABLE PROXY.
1.1 AGREEMENT TO VOTE. Stockholder hereby agrees that, during the time
this Agreement is in effect, at any meeting of the stockholders of the Company,
however called, or any adjournment thereof, or by written consent, Stockholder
shall be present (in person or by proxy) and vote (or cause to be voted) all of
its Voting Shares in favor of the approval of (i) the nominees to Expedia's
board of directors proposed by the Company in Proposal No. 4 included in the
Expedia S-4, and (ii) the adoption of the Expedia, Inc. 2001 Stock Plan, adopted
by the Company's board of directors in August 2001 and proposed by the Company
in Proposal No. 5 included in the Expedia S-4.
1.2 IRREVOCABLE PROXY. Solely with respect to the matters described in
Section 1.1, for so long as this Agreement has not been terminated pursuant to
its terms, Stockholder hereby irrevocably appoints Expedia as its proxy (which
proxy is irrevocable and which appointment is coupled with an interest,
including for purposes of Section 23B.07.220 of the Washington Business
Corporation Law) to vote solely on the matters described in Section 1.1, and in
accordance therewith. Stockholder agrees to execute any further agreement or
form reasonably necessary or appropriate to confirm and effectuate the grant of
the proxy contained herein.
2. TERMINATION.
2.1 TERMINATION OF THIS AGREEMENT. This Agreement shall (i) terminate
automatically on the termination of the Merger Agreement, in accordance with its
terms and (ii) be deemed satisfied in full and terminated upon the consummation
of all of the Transactions, PROVIDED, HOWEVER, that if the Effective Time
occurs, the provisions of Section 5.3, Section 7.5 and Section 7.6, shall
survive in accordance with their terms.
2.2 EFFECT OF TERMINATION. In the event of termination of this Agreement
pursuant to Section 2.1, this Agreement shall become void and of no effect with
no liability on the part of any party hereto; PROVIDED, HOWEVER, no such
termination shall relieve any party hereto from any liability for any breach of
this Agreement occurring prior to such termination; PROVIDED FURTHER, that if
the Effective Time occurs, Section 7.5, Section 7.6 and Section 8 shall not be
void and the parties shall continue to be liable in connection therewith.
3. REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER. Stockholder hereby represents
and warrants to Expedia as follows:
3.1 DUE ORGANIZATION. Microsoft has been duly organized and is validly
existing under the laws of the state of Washington and Sub has been duly
organized, is validly existing and is in good standing under the laws of the
state of Nevada.
3.2 POWER; DUE AUTHORIZATION; BINDING AGREEMENT. Stockholder has full
legal capacity, power and authority to execute and deliver this Agreement, to
perform its obligations hereunder and to consummate the transactions
contemplated hereby. This Agreement has been duly and validly executed and
delivered by Stockholder and constitutes a valid and binding agreement of
Stockholder, enforceable against Stockholder in accordance with its terms,
except that enforceability may be subject to the effect of any applicable
bankruptcy,
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reorganization, insolvency, moratorium or other similar laws affecting or
relating to the enforcement of creditors rights generally and to general
principles of equity.
3.3 OWNERSHIP OF SHARES. On the date hereof, the Owned Shares set forth
opposite Stockholder's (or Stockholder's controlled affiliate's) name on
Attachment A hereto are owned of record or beneficially by Stockholder or such
entity and constitute all of the Voting Shares owned of record or beneficially
by Stockholder, free and clear of any claims, liens, encumbrances, and security
interests, including, for greater certainty, any right in favor of a third party
to exercise voting rights with respect to such shares except insofar as voting
rights with respect to the Owned Shares may be limited by a Voting and Election
Agreement among USA and Stockholder, dated July 15, 2001 (the "Voting and
Election Agreement"). As of the date hereof, Stockholder (together with any
controlled affiliates of Stockholder listed on Attachment A) has, and as of the
date of the shareholder meeting of the Company (or action by written consent) in
connection with the Merger Agreement and the transactions contemplated thereby,
Stockholder (together with any such entity) will have (except as otherwise
permitted by this Agreement), sole voting power and sole dispositive power with
respect to all of the Owned Shares except insofar as voting rights with respect
to the Owned Shares may be limited by the Voting and Election Agreement.
3.4 NO CONFLICTS. Subject to the filings being made pursuant to Section
4.4 of the Merger Agreement and the effectiveness and/or receipt of consents or
approvals in connection with such filings, the execution and delivery of this
Agreement by Stockholder does not, and the performance of the terms of this
Agreement by Stockholder will not, (a) require Stockholder or any of its
affiliates to obtain the consent or approval of, or make any filing with or
notification to, any governmental or regulatory authority, domestic or foreign,
(b) require the consent or approval of any other person pursuant to any material
agreement, obligation or instrument binding on Stockholder or its properties and
assets, (c) conflict with or violate any organizational document or law, rule,
regulation, order, judgment or decree applicable to Stockholder or pursuant to
which any of its or its affiliates' respective properties or assets are bound or
(d) violate any other agreement to which Stockholder or any of its affiliates is
a party including, without limitation, any voting agreement, stockholders
agreement, irrevocable proxy or voting trust, except for any consent, approval,
filing or notification which has been obtained as of the date hereof or the
failure of which to obtain, make or give would not, or any conflict or violation
which would not, prevent, delay or materially adversely affect the consummation
of the transactions contemplated by this Agreement or the Merger Agreement and
except as noted in Section 3.3.
4. REPRESENTATIONS AND WARRANTIES OF EXPEDIA. Expedia hereby represents and
warrants to Stockholder as follows: Expedia is a corporation duly organized and
validly existing under the laws of the state of Washington. Expedia has full
corporate power and authority to execute and deliver this Agreement, to perform
its obligations hereunder and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the consummation by
Expedia of the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action on the part of Expedia, and no
other proceedings on the part of Expedia are necessary to authorize this
Agreement or to consummate the transactions contemplated hereby. This Agreement
has been duly and validly executed and delivered by Expedia and constitutes a
valid and binding agreement of Expedia, except that
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enforceability may be subject to the effect of any applicable bankruptcy,
reorganization, insolvency, moratorium or other similar laws affecting or
relating to the enforcement of creditors rights generally and to general
principles of equity.
5. CERTAIN COVENANTS OF STOCKHOLDER. Stockholder hereby covenants and agrees
with Expedia as follows:
5.1 RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE. Except as
contemplated herein or in the Voting and Election Agreement, Stockholder hereby
agrees, while this Agreement is in effect, at any time prior to the Effective
Time, not to (a) sell, transfer, pledge, encumber, assign or otherwise dispose
of, or enter into any contract, option or other arrangement or understanding
with respect to the sale, transfer, pledge, encumbrance, assignment or other
disposition of, or limitation on the voting rights of, any of the Voting Shares,
other than to controlled affiliates, (b) grant any proxies or powers of
attorney, deposit any Voting Shares into a voting trust or enter into a voting
agreement with respect to any Voting Shares, other than to controlled
affiliates, (c) take any action that would cause any representation or warranty
of Stockholder contained herein to become untrue or incorrect or have the effect
of preventing or disabling Stockholder from performing its obligations under
this Agreement or (d) commit or agree to take any of the actions prohibited by
this sentence. Any transfer of Voting Shares not permitted hereby shall be null
and void. Stockholder agrees that any such prohibited transfer may and should be
enjoined. If any involuntary transfer of any of the Voting Shares shall occur
(including, but not limited to, a sale by Stockholder's trustee in any
bankruptcy, or a sale to a purchaser at any creditor's or court sale), the
transferee (which term, as used herein, shall include any and all transferees
and subsequent transferees of the initial transferee) shall take and hold such
Voting Shares subject to all of the restrictions, liabilities and rights under
this Agreement, which shall continue in full force and effect.
5.2 ADDITIONAL SHARES. Stockholder hereby agrees, while this Agreement is
in effect, to promptly notify Expedia of the number of any new Voting Shares
acquired by Stockholder, if any, after the date hereof. Any such shares shall be
subject to the terms of this Agreement.
5.3 FURTHER ASSURANCES. From time to time, at the request of Expedia or
Stockholder and without further consideration, Stockholder or Expedia,
respectively, shall execute and deliver such additional documents and take all
such further action as may be necessary or desirable to consummate and make
effective the transactions contemplated by Sections 1, 5 and 6 of this
Agreement, in the case of Stockholder, and Section 2, in the case of Expedia.
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6. STOP TRANSFER ORDER. In furtherance of this Agreement, and concurrently
herewith, Stockholder shall and hereby does authorize the Company or the
Company's counsel to notify the Company's transfer agent that there is a stop
transfer order with respect to all of the Voting Shares. At the request of
Expedia, Stockholder shall cause to be provided to Expedia evidence of such stop
transfer order.
7. MISCELLANEOUS.
7.1 NON-SURVIVAL. The representations and warranties made herein shall not
survive the termination of this Agreement.
7.2 ENTIRE AGREEMENT; ASSIGNMENT. This Agreement, together with the Merger
Agreement, constitutes the entire agreement among the parties with respect to
the subject matter hereof and supersedes all other prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter hereof, except as contained in the Voting and Election Agreement.
USA shall be deemed to be a third party beneficiary of this Agreement with
respect to Sections 1, 2, 5, 6 and 7.3. Except as set forth in the preceding
sentence, nothing in this Agreement, express or implied, is intended to or shall
confer upon any other person any right, benefit or remedy of any nature
whatsoever under or by reason of this Agreement. This Agreement shall not be
assigned by operation of law or otherwise and shall be binding upon and inure
solely to the benefit of each party hereto.
7.3 AMENDMENTS. This Agreement may not be modified, amended, altered or
supplemented, except upon the execution and delivery of a written agreement
executed by each of the Stockholder and Company, PROVIDED that (i) Sections 1,
2, 5, 6, 7.2, 8 and this Section 7.3 shall not be modified, amended, altered or
supplemented without the prior written consent of USA and (ii) USA shall be
notified promptly following any other modification, amendment, alteration or
supplementation to this Agreement.
7.4 NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, by facsimile
transmission or by mail (registered or certified mail, postage prepaid, return
receipt requested) or by any courier service, such as Federal Express, providing
proof of delivery. All communications hereunder shall be delivered to the
respective parties at the following addresses:
If to Stockholder:
Microsoft Corporation
Xxx Xxxxxxxxx Xxx
Xxxxxxx, XX 00000
Attention: Deputy General Counsel, Finance and Operation
Facsimile: (000) 000-0000
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with a copy to:
Xxxxxxx Xxxxx & Xxxxx LLP
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Xxxxxxx X. Xxxx, Esq.
Facsimile: (000) 000-0000
If to Expedia:
00000 XX Xxxxxxxx Xxx, Xxxxx 000
Xxxxxxxx, Xxxxxxxxxx 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy to:
Shearman & Sterling
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: (000) 000-0000
If to USA:
000 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Facsimile: (000) 000-0000
with a copy to:
Wachtell, Lipton, Xxxxx & Xxxx
00 Xxxx 00xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Xxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
7.5 GOVERNING LAW
(a) This Agreement shall be governed by and construed in accordance
with the laws of the State of Washington, regardless of the laws that might
otherwise govern under applicable principles of conflicts of laws thereof.
(b) Each party hereto irrevocably submits to the jurisdiction of any
Washington state court or any federal court sitting in the State of Washington
in any action arising out of or
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relating to this Agreement, and hereby irrevocably agrees that all claims in
respect of such action may be heard and determined in such Washington state or
federal court. Each party hereto hereby irrevocably waives, to the fullest
extent it may effectively do so, the defense of an inconvenient forum to the
maintenance of such action or proceeding. The parties hereto further agree, to
the extent permitted by law, that final and unappealable judgment against any of
them in any action or proceeding contemplated above shall be conclusive and may
be enforced in any other jurisdiction within or outside the United States by
suit on the judgment, a certified copy of which shall be conclusive evidence of
the fact and amount of such judgment.
(c) To the extent that any party hereto has or hereafter may acquire
any immunity from jurisdiction of any court or from any legal process (whether
through service or notice, attachment prior to judgment, attachment in aid of
execution, execution or otherwise) with respect to itself or its property, each
party hereto hereby irrevocably waives such immunity in respect of its
obligations with respect to this Agreement.
(d) Each party hereto waives, to the fullest extent permitted by
applicable laws, any right it may have to a trial by jury in respect of any
action, suit or proceeding arising out of or relating to this Agreement. Each
party hereto certifies that it has been induced to enter into this Agreement by,
among other things, the mutual waivers and certifications set forth above in
this Section.
7.6 REMEDIES. Each of Stockholder and Expedia recognize and acknowledge
that a breach by it of any covenants or agreements contained in this Agreement
will cause the other party to sustain irreparable injury and damages, for which
money damages would not provide an adequate remedy, and therefore each of
Stockholder and Expedia agrees that in the event of any such breach by the
other, Stockholder or Expedia, as the case may be, shall be entitled to the
remedy of specific performance of such covenants and agreements and injunctive
and other equitable relief.
7.7 COUNTERPARTS. This Agreement may be executed by facsimile and in two
or more counterparts, each of which shall be deemed to be an original, but all
of which together shall constitute one and the same Agreement.
7.8 DESCRIPTIVE HEADINGS. The descriptive headings used herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
7.9 SEVERABILITY. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
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8. WAIVER BY USA. USA hereby consents to and waives any breach of the Voting and
Election Agreement that may result from the execution of this Agreement by
Microsoft or from Microsoft's performance of its obligations under this
Agreement in accordance with its terms.
[REMAINDER OF PAGE INTENTIONALLY BLANK]
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SIGNATURE PAGE--VOTING AGREEMENT AND IRREVOCABLE PROXY
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
EXPEDIA, INC.
By: /s/ Xxxxxxx X. Xxxxxx
---------------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Chief Executive Officer
MICROSOFT CORPORATION
By: /s/ Xxxxxxx Xxxxxxx
---------------------------------------
Name: Xxxxxxx Xxxxxxx
Title: Senior Vice President, Corporate
Development and Strategy
MICROSOFT E-HOLDINGS, INC.
By: /s/ Xxxxxx X. Xxxxxxxx
---------------------------------------
Name: Xxxxxx X. Xxxxxxxx
Title: President and Treasurer
For purposes of Sections 7.2, 7.3 and 8 only
USA NETWORKS, INC.
By: /s/ Xxxxxx Xxxxxxxxxxx
---------------------------------------
Name: Xxxxxx Xxxxxxxxxxx
Title: Senior Vice President
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ATTACHMENT A
33,602,258 Shares of Company Common Stock
Warrants to purchase up to 120,452 Shares of Company Common Stock (as such
number may be decreased in the event of a cashless exercise of the Warrants)
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