Exhibit 99.2
XXXXXXX AGREEMENT
This Agreement is made as of June 2, 2000, between Meridian Associates,
L.P., an Illinois limited partnership ("MERIDIAN"), and Xxxx X. Xxxxxxx (the
"STOCKHOLDER").
RECITALS
SDI, Inc., a Nevada corporation, HSA Properties, Inc. a Delaware
corporation, and Meridian, have entered into a Recapitalization Agreement dated
as of June 2, 2000 (the "RECAPITALIZATION AGREEMENT"), with U.S. Franchise
Systems, Inc., a Delaware corporation (the "COMPANY"), contemplating, among
other things, an investment by the Investors in new Preferred Stock of the
Company and an offer by the Company to purchase shares of its Common Stock. The
Stockholder is the record and beneficial owner of 2,099,318 Shares of Common
Stock of the Company (the "STOCKHOLDER SHARES"). The Investor Group has
requested that the Stockholder enter into this Agreement simultaneously with the
execution and delivery of the Recapitalization Agreement.
AGREEMENT
For good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereby agree as follows:
Section 1. DEFINED TERMS. Capitalized words used in this Agreement as
defined terms shall have the meanings given to them in the Recapitalization
Agreement, unless otherwise defined herein.
Section 2. TERMINATION. Notwithstanding any of the provisions herein, the
Stockholder's obligations stated in this Agreement shall cease to be effective
if (a) the Offer shall have expired in accordance with its terms without the
acceptance for purchase of at least 3,000,000 Shares pursuant thereto, (b) the
Offer shall have been terminated or withdrawn for any reason (other than a
breach by the Stockholder of any of his obligations to the Company and/or the
Investor Group), (c) the Recapitalization Agreement is earlier terminated for
any reason (other than a breach by the Stockholder of any of his obligations to
the Company and/or the Investor Group) in accordance with SECTION 8.4 thereof or
otherwise, (d) the Offer shall have been amended or otherwise modified in any
material respect (other than the extension of time for tenders of Shares),
including, without limitation, to reduce the number of Shares which the Company
is offering to purchase or the price at which the Company will purchase Shares
pursuant thereto, or (e) the Restricted Stock shall not have fully vested (and
no longer be subject to forfeiture) immediately before the Closing Date (but
subject to the Closing).
Section 3. AGREEMENT REGARDING TENDER OFFER. The Stockholder shall, prior
to the expiration date of the Offer, duly tender all of his Stockholder Shares
to the Company for purchase pursuant to the Offer and shall not withdraw such
Stockholder Shares.
Section 4. VOTING SHARES. At any meeting of stockholders of the Company
called for this purpose, the Stockholder shall vote his Stockholder Shares and
any other shares of Common Stock of the Company as to which the Stockholder has
the power to vote, in person or by proxy, in favor of any resolution
authorizing, in accordance with the Recapitalization Agreement, the issuance of
the Preferred Stock and the Class A Common Stock issuable upon conversion of the
B Preferred, the Charter Amendments, and any other action necessary or advisable
in order to consummate the transactions contemplated by the Recapitalization
Agreement.
Section 5. AGREEMENT TO CONVERT. If the Offer is consummated in accordance
with its terms and the Company purchases any Shares but does not purchase all of
the Stockholder's Shares, the Stockholder will take all actions required to
exercise his right to convert his Shares that represent Class B Common Stock
into Shares that represent Class A Common Stock, effective on or before the
first Business Day after the Closing Date.
Section 6. TERMINATION OF OTHER AGREEMENTS.
(a) The Stockholder shall take such actions and execute and deliver such
instruments as Meridian may deem reasonably necessary and appropriate to
terminate the Registration Rights Agreement among the Company, Alpine
Hospitality Equities LLC, Leven and Xxxxxxx dated April 28, 1998 (the
"Alpine Registration Rights Agreement") and the Registration and Tag-Along
Rights Agreement among Sextant Trading LLC, Xxxxxx-Xxxxx Real Estate
Opportunity Fund, L.P., Xxxxxx-Xxxxx Real Estate Opportunity Fund II, L.P.,
Xxxxxx-Xxxxx Capital Real Estate Opportunity Fund, L.P., the Company, Leven
and Xxxxxxx dated March, 1998 (the "Sextant/Xxxxxx-Xxxxx Agreement") and/or
the Stockholder's rights under those agreements, effective as of the Closing
Date.
(b) The Stockholder shall execute and deliver a Special Durable Power of
Attorney as of the date hereof (the "POWER OF ATTORNEY"), pursuant to which
Power of Attorney the Stockholder shall irrevocably appoint Xxxxxxx X. Xxxxx
as his true lawful attorney-in-fact to execute and deliver in the name and
on behalf of the Stockholder (i) the documents required to be executed and
delivered in order to terminate the Alpine Registration Rights Agreement and
for the rights of the Stockholder thereunder, (ii) the documents required to
be executed and delivered in order to terminate the Sextant/Xxxxxx-Xxxxx
Agreement and for the rights of the Stockholder thereunder and (iii) any
other documents required to be executed in connection with the matters
described in the preceding clauses (i) and (ii).
Section 7. AMENDMENT AND WAIVER. Except as otherwise provided herein, no
modification, amendment or waiver of any provision of this Agreement shall be
effective against Meridian or the Stockholder unless such modification,
amendment or waiver is approved in writing signed by the party to be bound. The
failure of any party to enforce any of the provisions of this Agreement shall in
no way be construed as a waiver of such provisions and shall not affect the
right of such party thereafter to enforce each and every provision of this
Agreement in accordance with its terms.
Section 8. SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law, but if 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 shall not affect
any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision had never been contained herein.
Section 9. ENTIRE AGREEMENT. Except as otherwise expressly set forth
herein, this document together with the agreements dated the date hereof to
which the Stockholder is a party relating to the transactions contemplated by
the Recapitalization Agreement shall serve as the entire agreement of the
parties hereto concerning the subject matter of this Agreement and supersedes
and preempts any prior understandings, agreements or representations by or among
the parties, written or oral, which may have related to the subject matter
hereof in any way.
Section 10. SUCCESSORS AND ASSIGNS. Except as otherwise provided herein,
this Agreement shall bind and inure to the benefit of and be enforceable by
Meridian and the Stockholder and any subsequent holders of the Shares and the
respective successors and assigns of each of them.
Section 11. DESCRIPTIVE HEADINGS. The descriptive headings of this
Agreement are inserted for convenience only and do not constitute a part of this
Agreement.
Section 12. REMEDIES. Each of the parties hereto shall be entitled to
enforce its or his rights under this Agreement specifically to recover damages
by reason of any breach of any provision of this Agreement and to exercise all
other rights existing in its or his favor. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of
the provisions of this Agreement and that each party may in its or his sole
discretion apply to any court of law or equity of competent jurisdiction
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for specific performance and/or injunctive relief (without posting a bond or
other security) in order to enforce or prevent any violation of the provisions
of this Agreement.
Section 13. NOTICES. Any notice provided for in this Agreement shall be in
writing and shall be either personally delivered, or mailed first class
certified mail (postage prepaid and return receipt requested) or sent by
reputable overnight courier service (charges prepaid) to any other recipient at
the address indicated on the signature pages hereof, or at such address or to
the attention of such other Person as the recipient party has specified by prior
written notice to the sending party. Notices will be deemed to have been given
hereunder when delivered personally, when received if sent by U.S. mail and one
day after deposit with a reputable overnight courier service.
Section 14. GOVERNING LAW. All questions concerning the construction,
validity and interpretation of this Agreement shall be governed by the internal
law, and not the law of conflicts, of Delaware.
Section 15. COUNTERPARTS. This Agreement may be executed in separate
counterparts each of which shall be an original and all of which taken together
shall constitute one and the same agreement.
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SIGNATURE PAGE FOLLOWS.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
day and year first written above.
MERIDIAN ASSOCIATES, L.P.
By: Meridian Investments Inc.
By: /s/ X.X. Xxxxxxxxxx
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Name: X.X. Xxxxxxxxxx
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Its: Vice President
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000 Xxxx Xxxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxxxx
/s/ Xxxx Xxxxxxx
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XXXX XXXXXXX
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