SUBSCRIPTION AGREEMENT
SUBSCRIPTION AGREEMENT, dated as of May 16, 2001, between
GRILL CONCEPTS, INC., a corporation organized and existing under the laws of the
State of Delaware ("Issuer"); and STARWOOD HOTELS AND RESORTS WORLDWIDE, INC., a
corporation organized and existing under the laws of the State of Maryland
("Investor");
W I T N E S S E T H:
WHEREAS, Issuer wishes to issue and sell to Investor, and
Investor wishes to purchase from Issuer, 666,667 shares (the "Shares") of
Issuer's common stock, par value $0.00004 per share ("Common Stock") at a price
of $1.50 per share, all upon the terms and subject to the conditions set forth
herein;
WHEREAS, Issuer wishes to issue to Investor, and Investor
wishes to acquire from Issuer, warrants (the "Initial Warrants") to purchase
666,667 shares (the "Initial Warrant Shares") of Common Stock at an exercise
price of $2.00 per share, all upon the terms and subject to the conditions set
forth herein and in the applicable warrant certificate; and
WHEREAS, Issuer and Investor wish to enter into an agreement,
effective concurrently with the purchase of the Shares and acquisition of the
Initial Warrants, substantially in the form attached hereto as Exhibit A (the
"Development Agreement") pursuant to which, inter alia, Issuer has agreed to
issue to Investor: (i) warrants (the "Development Warrants") to purchase certain
additional shares of Common Stock from time to time for every five GCI Concept
Facilities (as defined in the Development Agreement) opened after the date
hereof; and (ii) warrants (the "Incentive Warrants," and together with the
Development Warrants, the "Subsequent Warrants") to purchase certain additional
shares of Common Stock from time to time in the event that the total number of
GCI Concept Facilities represent more than thirty-five percent of the aggregate
then operational GCI Facilities (as defined in the Development Agreement); in
each case, upon the terms and subject to the conditions specified in the
Development Agreement and the applicable warrant certificate;
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties, covenants, and agreements set forth herein, and
other good and valuable consideration, the receipt and adequacy of which are
hereby acknowledged, and intending to be legally bound hereby, the parties
hereto hereby covenant and agree as follows:
SECTION 1. Certain Defined Terms. Capitalized terms used and
not otherwise defined in the body hereof are used herein as defined in Schedule
I hereto.
SECTION 2. Authorization of the Securities. Issuer shall,
prior to the Closing: (a) duly authorize the issuance and sale of the Shares to
Investor at a purchase price of $1.50 per share; (b) duly authorize the issuance
of the Initial Warrants, and the Initial Warrant Shares upon exercise thereof,
to Investor; and (c) duly authorize the issuance of the Subsequent Warrants, and
the shares of Common Stock issuable upon exercise thereof (collectively, the
"Subsequent Warrant Shares"), to Investor.
SECTION . Purchase and Sale of Shares and Warrants. On the
Closing Date and at the Closing, Issuer shall: (a) sell, issue, and deliver to
Investor or its assigns, free and clear of all Encumbrances, and Investor or its
assigns shall purchase from Issuer for an aggregate purchase price of
$1,000,000.50 (the "Purchase Price"), the Shares; and (b) issue and deliver to
Investor or its assigns, free and clear of all Encumbrances, the Initial
Warrants.
SECTION 4. Closing Deliveries. Subject to Section 13, at the
Closing: (a) Issuer shall execute and deliver or cause to be delivered to
Investor the Share Certificate, the Initial Warrant Certificate, and the other
Transaction Agreements, opinions, certificates, and documents required to be
delivered pursuant to Section 12(b); and (b) Investor shall deliver to Issuer by
wire transfer of immediately available funds to the Purchase Price Bank Account
the Purchase Price, and subject to the satisfaction of each of the conditions
specified in Section 12(b), execute and deliver to Issuer each Transaction
Agreement to which Investor is a party.
SECTION . Representations and Warranties of Issuer. As an
inducement to Investor to enter into this Agreement, except as set forth in the
Disclosure Schedule (with reference to the section and, if applicable,
subsection or clause to which such exception relates), Issuer hereby represents
and warrants to Investor as provided below:
(a) Organization and Authority. Issuer and each
Subsidiary is a corporation or other entity duly organized, validly
existing and in good standing under the laws of its jurisdiction of
incorporation or organization, and, upon approval of the terms of the
Transaction Agreements by the stockholders of Issuer as required by
Sections 8, 12(a)(ii), and 12(b)(xii) (the "Stockholder Approval
Requirement"), has all necessary power and authority: (i) to own and
operate its properties and assets and to carry on its business as now
conducted and presently proposed to be conducted; (ii) to issue and
sell: (A) the Shares; (B) the Initial Warrants; (C) the Initial Warrant
Shares; (D) the Subsequent Warrants; and (E) the Subsequent Warrant
Shares; and (iii) to enter into this Agreement, to carry out its
obligations hereunder, and to consummate the transactions contemplated
hereby. Issuer and each Subsidiary is duly licensed or qualified to do
business and is in good standing in each jurisdiction in which the
properties owned or leased by it or the operation of its business makes
such licensing or qualification necessary, appropriate, or desirable,
except for those jurisdictions in which failure to be so licensed or
qualified would not have a Material Adverse Effect.
(b) Authorization, Execution and Delivery. Subject to
the Stockholder Approval Requirement, the execution and delivery of
this Agreement and each other Transaction Agreement to which it is a
party by Issuer, the performance by Issuer of its obligations hereunder
and thereunder, and the consummation by Issuer of the transactions
contemplated hereby and thereby will have been duly authorized and
approved by all requisite action on the part of Issuer. Subject to the
Stockholder Approval Requirement, this Agreement has been, and upon
execution of Issuer of each other Transaction Agreement to which it is
a party will have been, duly executed and delivered by Issuer, and
(assuming due authorization, execution and delivery by Investor) this
Agreement constitutes, and each other Transaction Agreement to which it
is a party will constitute, a legal, valid, and binding obligation of
Issuer enforceable against Issuer in accordance with its terms.
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(c) Capital Stock. A true and complete description of
the authorized, issued, and outstanding capital stock of Issuer is set
forth in Section 5(c)(i) of the Disclosure Schedule. Except as
described in Section 5(c)(i) of the Disclosure Schedule, there are no
options, warrants, convertible securities, or other Contracts of any
kind, nature, or description whatsoever relating to the capital stock
of Issuer or obligating Issuer to issue or sell any shares of capital
stock of, or any other interest in, Issuer. None of the issued and
outstanding shares of Common Stock was issued in violation of any
preemptive rights. There are no outstanding contractual obligations of
Issuer or any Subsidiary to repurchase, redeem, or otherwise acquire
any shares of Common Stock or Preferred Stock or to provide funds to,
or make any investment (in the form of a loan, capital contribution, or
otherwise) in, any other Person.
(ii) Upon consummation of the transactions contemplated hereby
(excluding the impact of the issuance of any Subsequent Warrants) and
registration of the Shares in the name of Investor in the stock records
of Issuer: (A) Investor will own the percent of the issued and
outstanding capital stock of Issuer on a fully-diluted basis (assuming
the exercise, exchange, or conversion of all of the options, warrants,
convertible securities, and other Contracts of any kind, nature, or
description whatsoever relating to the capital stock of Issuer or
obligating Issuer to issue or sell any shares of capital stock of, or
any other interest in, Issuer or any subsidiary thereof; and assuming
consummation of all of the transactions contemplated hereby) specified
in Section 5(c)(i) of the Disclosure Schedule; (B) the Shares and the
Initial Warrants will be duly authorized, validly issued, fully paid
and nonassessable, and free and clear of all Encumbrances; and (C) the
Subsequent Warrants and the shares of Common Stock issuable upon
exercise of the Initial Warrants and the Subsequent Warrants will be
duly and properly reserved for issuance and, upon the issuance thereof,
will be duly authorized, validly issued, fully paid, and nonassessable,
and free and clear of all Encumbrances.
(iii) The offer, issuance, and sale of all outstanding shares
of capital stock of Issuer were registered and related prospectuses
delivered in accordance with, or were exempt from the registration and
prospectus delivery requirements of, the Securities Act; and were
registered or qualified, or were exempt from registration and
qualification, under the registration, permit, or qualification
requirements of all applicable state securities laws.
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(iv) Other than the Investor Rights Agreement and the
Stockholders Agreement, there are no voting trusts, stockholder
agreements, proxies, or other Contracts in effect with respect to the
voting or transfer of any shares of capital stock of, or any other
interests in, Issuer.
(v) The stock register of Issuer accurately records: (A) the
name and address of each Person owning shares of capital stock of
Issuer; and (B) the certificate number of each certificate evidencing
shares of capital stock issued by Issuer, the number of shares
evidenced by each such certificate, the date of issuance thereof, and,
in the case of cancellation, the date of cancellation thereof.
(d) Subsidiaries. Set forth in Section 5(d)(i) of the
Disclosure Schedule is a true and complete list of all Subsidiaries.
Except as described in Section 5(d)(i) of the Disclosure Schedule,
neither Issuer nor any Subsidiary: (A) owns, beneficially or of record,
any direct or indirect equity or other interest or any right
(contingent or otherwise) to acquire the same in any Person; (B) is a
member of, nor is any part of its business conducted through, any
partnership; and (C) is a participant in any joint venture or similar
arrangement.
(ii) There are no options, warrants, convertible securities,
or other Contracts of any kind, nature, or description whatsoever
relating to the capital stock of any Subsidiary or obligating Issuer or
any Subsidiary to issue or sell any shares of capital stock of, or any
other interest in, any Subsidiary. None of the issued and outstanding
shares of capital stock of any Subsidiary was issued in violation of
any preemptive rights. There are no outstanding contractual obligations
of Issuer or any Subsidiary to repurchase, redeem, or otherwise acquire
any shares of capital stock of any Subsidiary or to provide funds to,
or make any investment (in the form of a loan, capital contribution, or
otherwise) in, any other Person.
(iii) There are no voting trusts, stockholder agreements,
proxies, or other Contracts in effect with respect to the voting or
transfer of any shares of capital stock of, or any other interests in,
any Subsidiary.
(iv) The stock register of each Subsidiary accurately records:
(A) the name and address of each Person owning shares of capital stock
of such Subsidiary; and (B) the certificate number of each certificate
evidencing shares of capital stock issued by such Subsidiary, the
number of shares evidenced by each such certificate, the date of
issuance thereof, and, in the case of cancellation, the date of
cancellation thereof.
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(e) Exchange Act Documents. Issuer is subject to
Section 13 or 15(d) of the Exchange Act and has timely made all
periodic and other filings required to be made under the Exchange Act
and the rules promulgated thereunder for Issuer's fiscal years ended
December 26, 1999 and December 31, 2000. The information contained in
the following documents (collectively, the "Exchange Act Documents")
filed by Issuer with the Commission was true, correct, and complete in
all material respects as of the respective filing date of each such
document:
(i) Issuer's Annual Report on Form 10-K for
the year ended December 31, 2000; and
(ii) all other documents, if any, filed by
Issuer with the Commission since December 31, 2000.
(f) No Conflict. The execution, delivery, and
performance of this Agreement and each other Transaction Agreement to
which it is a party by Issuer do not and will not: (i) violate,
conflict with, or result in the breach of any provision of the
certificate of incorporation or by-laws (or similar organizational
documents) of Issuer or any Subsidiary; (ii) conflict with or violate
(or cause an event or condition which could reasonably be expected to
result in a Material Adverse Effect as a result of) any Law or
Governmental Order applicable to Issuer or any Subsidiary or any of
their respective assets, properties, or businesses; or (iii) except as
set forth in Section 5(f) of the Disclosure Schedule, conflict with,
result in any breach of, constitute a default (or event which with the
giving of notice or lapse of time or both would become a default)
under, require any consent under, or give to others any rights of
termination, amendment, acceleration, suspension, revocation or
cancellation of, or result in the creation of any Encumbrance on any of
the Shares, the Initial Warrants, the Initial Warrant Shares, the
Subsequent Warrants, or the Subsequent Warrant Shares, or on any of the
assets or properties of Issuer or any Subsidiary pursuant to, any
Contract to which Issuer or any Subsidiary is a party or by which any
of such assets or properties is bound or affected.
(g) Consents and Approvals. The execution, delivery,
and performance of this Agreement and each other Transaction Agreement
to which it is a party by Issuer do not and will not require any
consent, approval, authorization, or other order of, action by, filing
with, or notification to, any Governmental Authority or any other
Person; except for the Stockholder Approval Requirement and the filing
of notices of sale in accordance with the registration, permit, or
qualification requirements of all applicable state securities laws.
(h) Financial Information; Books and Records. (i) The
Financial Statements: (A) were prepared in accordance with the books of
account and other financial records of Issuer and each Subsidiary; (B)
present fairly the consolidated financial condition and results of
operations of Issuer and each Subsidiary as of the dates thereof or for
the periods covered thereby; (C) were prepared in accordance with U.S.
GAAP applied on a basis consistent with the past practices of Issuer
and each Subsidiary and throughout the periods involved; and (D)
include all adjustments (consisting only of normal recurring accruals)
that are necessary for a fair presentation of the consolidated
financial condition and results of operations of Issuer as of the dates
thereof or for the periods covered thereby.
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(ii) The books of account and other financial records of Issuer and
each Subsidiary reflect all items of income and expense and all assets and
liabilities required to be reflected therein in accordance with U.S. GAAP
applied on a basis consistent with the past practices of Issuer and each
Subsidiary and throughout the periods involved, are true and complete in
all material respects, do not contain or reflect any material inaccuracies
or discrepancies, and have been maintained in accordance with good business
and accounting practices.
(i) No Undisclosed Liabilities. There are no Liabilities of
Issuer or any Subsidiary; except for: (i) Liabilities adequately
reflected or reserved against on the Financial Statements; or (ii)
Liabilities incurred since December 31, 2000, in the ordinary course
of business, consistent with past practice, of Issuer and each
Subsidiary, which Liabilities are not material, individually or in the
aggregate. Set forth in Section 5(i) of the Disclosure Schedule is a
true and complete schedule of all outstanding indebtedness of Issuer
and its Subsidiaries, except for any outstanding indebtedness which is
not in excess of $10,000 individually, or $50,000 in the aggregate.
(j) Conduct in the Ordinary Course. Since December 31, 2000,
Issuer and each Subsidiary has conducted its businesses and operations
in the ordinary course and consistent with good business practices.
(k) Litigation; Governmental Orders. Set forth in Section 5(k)(i)
of the Disclosure Schedule is a true and complete list and brief
description of each Action by or against Issuer or any Subsidiary or
affecting any of the assets, properties, businesses, or operations
thereof, pending before, or, to the best knowledge of Issuer,
threatened to be brought by or before, any Governmental Authority at
any time during the past three years, which has had or could
reasonably be expected to have a Material Adverse Effect or could
reasonably be expected to affect the legality, validity, or
enforceability of this Agreement or any other Transaction Agreement or
the consummation of the transactions contemplated hereby or thereby.
(ii) Set forth in Section 5(k)(ii) of the Disclosure Schedule is a true and
complete list and brief description of each Governmental Order applicable to
Issuer or any Subsidiary or affecting any of the assets, properties, businesses,
or operations thereof; and no such Governmental Order has had or could
reasonably be expected to have a Material Adverse Effect or could reasonably be
expected to affect the legality, validity, or enforceability of this Agreement
or any other Transaction Agreement or the consummation of the transactions
contemplated hereby or thereby.
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(l) Compliance with Laws. Issuer and each Subsidiary have conducted
and continue to conduct their respective businesses and operations in
accordance with all applicable Laws and Governmental Orders, and neither
Issuer nor any Subsidiary is in violation of any such Law or Governmental
Order, except where the failure to so comply or any such violation could
not reasonably be expected to have a Material Adverse Effect.
(m) Contracts. Each Material Contract is legal, valid, and binding on
the respective parties thereto and is in full force and effect and, upon
consummation of the transactions contemplated hereby, shall continue in
full force and effect without penalty or other adverse consequence. Neither
Issuer nor any Subsidiary nor, to the best knowledge of Issuer, any other
party thereto is in breach of or default under any Material Contract.
(n) Real Property. Issuer or a Subsidiary, as the case may be, is in
peaceful and undisturbed possession of each parcel of Real Property and
there are no contractual or legal restrictions that preclude or restrict
the ability of Issuer or such Subsidiary to use the premises for the
purposes for which they are currently being used.
(o) Intellectual Property. All of the Owned Intellectual Property is
owned by Issuer or a Subsidiary, free and clear of all Encumbrances, and
all of the Licensed Intellectual Property is held by Issuer or a Subsidiary
pursuant to valid and subsisting licenses or sublicenses. The rights of
Issuer and the Subsidiaries in, to, or under such Owned Intellectual
Property and Licensed Intellectual Property do not conflict with or
infringe on the rights of any other Person. No Action has been made or
asserted or is pending, nor, to the best knowledge of Issuer, has any such
Action been threatened, against Issuer or any Subsidiary either based upon
or challenging or seeking to deny or restrict the use by Issuer or any
Subsidiary of any of the Owned Intellectual Property or Licensed
Intellectual Property or alleging that any services provided, or products
manufactured or sold by Issuer or any Subsidiary are being provided,
manufactured, or sold in violation of any Intellectual Property of any
Person. To the best knowledge of Issuer, no Person is using any
Intellectual Property that is confusingly similar to the Owned Intellectual
Property or the Licensed Intellectual Property or that infringe upon the
Owned Intellectual Property or the Licensed Intellectual Property or upon
the rights of Issuer or any Subsidiary therein, thereto, or thereunder.
Neither Issuer nor any Subsidiary has granted any license or sublicense or
other right to any other Person with respect to any of the Owned
Intellectual Property or the Licensed Intellectual Property. The
consummation of the transactions contemplated hereby will not result in the
termination or impairment of any of the Owned Intellectual Property or the
Licensed Intellectual Property. To the best knowledge of Issuer, no
employee of Issuer or any Subsidiary has violated any proprietary
information agreement, employment agreement, or similar Contract, which
such employee had with any previous employer, or any Intellectual Property
policy of any such employer, or is a party to any Action relating to
Intellectual Property.
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(p) Assets. Issuer or a Subsidiary owns, leases, or has the legal
right to use all of the Material Assets and, with respect to Contracts
forming a part of the Material Assets, Issuer or a Subsidiary is a party to
and enjoys the right to the benefits of such Contracts. Issuer or a
Subsidiary has good and marketable title to, or, in the case of leased or
subleased, or licensed or sublicensed Material Assets, valid and subsisting
leasehold interests in or licenses to, all of the Material Assets, free and
clear of all Encumbrances, except for Permitted Encumbrances.
(q) Customers and Suppliers. No supplier to or customer of Issuer has
terminated or substantially altered, or has notified Issuer of any
intention to terminate or substantially alter, its existing business
relationship with Issuer, except for any termination or alteration which
could not reasonably be expected to have a Material Adverse Effect.
(r) Key Employees. To the best knowledge of Issuer, no officer or
senior management, technical, or professional employee of Issuer or any
Subsidiary (each a "Key Employee") intends to terminate his or her
employment relationship with Issuer or any such Subsidiary, and neither
Issuer nor any Subsidiary has any present intention to terminate the
employment of any officer or management, technical, or professional
employee thereof. Each director and Key Employee is under written contract
to Issuer or the relevant Subsidiary to maintain in confidence all
confidential or proprietary information acquired by such individual in the
course of his or her employment therewith, and to assign to Issuer or such
Subsidiary all inventions made by such individual within the scope of his
or her employment during such employment and for a reasonable period
thereafter.
(s) Certain Interests. Except as set forth in Section 5(s) of the
Disclosure Schedule, to the best knowledge of Issuer, no stockholder,
director, officer, or Key Employee of Issuer or any Subsidiary, no relative
or spouse (or relative of such spouse) who resides with, or is a dependent
of, any such stockholder, director, officer, or Key Employee, and no
Affiliate of any such Person: (i) has any direct or indirect financial
interest in any competitor, customer, or supplier of Issuer or any
Subsidiary; provided, however, that the ownership of securities
representing no more than one percent of the outstanding voting power of
any competitor, supplier, or customer, and which are also listed on any
national securities exchange or traded actively in the national
over-the-counter market, shall not be deemed to be a "financial interest"
so long as the Person owning such securities has no other connection or
relationship with such competitor, supplier or customer; (ii) owns,
directly or indirectly, in whole or in part, or has any other interest in
any tangible or intangible property belonging to or used, held for use, or
intended to be used by Issuer or any Subsidiary or forming a part of or
used, held for use, or intended to be used in connection with, necessary
for, or otherwise material to the conduct of, the business and operations
of Issuer or any Subsidiary; or (iii) has outstanding any indebtedness to
Issuer or any Subsidiary. Except as set forth in Section 5(s) of the
Disclosure Schedule, neither Issuer nor any Subsidiary has any Liability or
any other obligation of any kind, nature, or description whatsoever to or
on behalf of any stockholder, director, officer, or Key Employee of Issuer
or any Subsidiary, or, to the best knowledge of Issuer, to any relative or
spouse (or relative of such spouse) who resides with, or is a dependent of,
any such stockholder, director, officer, or Key Employee, or to any
Affiliate of any such Person; except for Liabilities relating to: (A) the
payment of salary for services rendered; (B) the reimbursement of
reasonable and necessary business expenses incurred on behalf of Issuer or
such Subsidiary; and (C) the payment or grant of other standard employee
benefits made generally available to all employees of Issuer or such
Subsidiary (including stock option agreements outstanding under any
employee stock option plan approved by the board of directors of Issuer or
such Subsidiary).
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(t) Taxes. Issuer and each Subsidiary has timely filed each return and
report in respect of Taxes required to be filed thereby (collectively, the
"Tax Returns"). All Taxes required to be shown on any Tax Return or
otherwise due from Issuer or any Subsidiary have been timely paid. All Tax
Returns are true and complete in all material respects. No adjustment
relating to any Tax Return has been proposed formally or informally by any
Governmental Authority and, to the best knowledge of Issuer, no basis
exists for any such adjustment. There are no pending or, to the best
knowledge of Issuer, threatened Actions for the assessment or collection of
Taxes against Issuer or any Subsidiary or any other Person that was
required or permitted to be included in the filing of a Tax Return with
Issuer or any Subsidiary on a consolidated or combined basis. There are no
Tax liens on any properties or assets of Issuer or any Subsidiary, except
for Tax liens in excess of $7,500 individually, or $15,000 in the
aggregate. Issuer is entitled to a valid tax loss carry-forward for United
States income tax purposes of not less than $2,254,000 as of the last
audited Issuer financial statements, which tax loss carry-forward will not
expire (to the extent not used) for at least four years from the date
hereof; provided that: (i) Issuer has not utilized any tax loss
carry-forward since the date of Issuer's last audited financial statements;
and (ii) neither Issuer nor any Subsidiary has taken any action that could
reasonably be expected to preclude Issuer from utilizing any such tax loss
carry-forward.
(u) Environmental Matters. Issuer and each Subsidiary is and has been
in compliance with all applicable Environmental Laws; has obtained all
Environmental Permits necessary, appropriate, or desirable in connection
with the ownership of their respective properties and assets and the
conduct of their respective businesses; and is and has been in compliance
with the requirements of all such Environmental Permits; in each case,
except for any failure to so comply, or to so obtain an Environmental
Permit, which could not reasonably be expected to have a Material Adverse
Effect.
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(v) Insurance. All material assets, properties, and risks of Issuer
and each Subsidiary are, and for the past three years have been, covered by
valid and, except for policies that have expired under their terms in the
ordinary course, currently effective insurance policies or binders of
insurance (including, without limitation, general liability insurance,
property insurance, business interruption insurance, directors and officers
insurance and workers' compensation insurance) issued in favor of Issuer,
in each case with reputable insurance companies, in such types and amounts
and covering such risks as are consistent with customary practices and
standards of companies engaged in businesses and operations similar to
those of Issuer and each Subsidiary.
(w) Private Offering; NASD Compliance. Assuming the accuracy of
Investor's representations in Section 6, the offer, issuance, and sale of
the Shares, the Initial Warrants, the Initial Warrant Shares, the
Subsequent Warrants, and the Subsequent Warrant Shares are and will be
exempt from the registration and prospectus delivery requirements of the
Securities Act, and have been registered or qualified, or are exempt from
registration and qualification, under the registration, permit, or
qualification requirements of all applicable state securities laws. The
offering and sale of the Shares and the Initial Warrants pursuant to the
terms and conditions of this Agreement and the Initial Warrants Certificate
do not violate the National Association of Securities Dealers, Inc.
("NASD") By-Laws or the marketplace rules of the Nasdaq Stock Market, and
Issuer is in full compliance with the listing eligibility rules promulgated
by the Nasdaq Stock Market and has not received any oral or written
notification from NASD or any Governmental Authority regarding any failure
to comply with such listing eligibility criteria.
(x) Registration Rights. Except as set forth in Section 5(x) of the
Disclosure Schedule, the Investor Rights Agreement and the registration
rights to be provided to the investors making the contemporaneous
investment described in Section 12(b)(iv) of this Agreement, neither Issuer
nor any Subsidiary has granted to any Person any rights to cause Issuer or
any such Subsidiary to register under the Securities Act, any shares of
capital stock of Issuer or any such Subsidiary now or hereafter held
thereby, or to sell any such shares of capital stock in connection with any
registration under the Securities Act, undertaken by Issuer or any
Subsidiary on its own behalf or on behalf of any other Person.
(y) Full Disclosure. Set forth in Section 5(y) of the Disclosure
Schedule is a list of pending material transactions not otherwise disclosed
in the Disclosure Schedule. To the best knowledge of Issuer, there exist no
facts, circumstances, or conditions, that have resulted in or could
reasonably be expected to result in a Material Adverse Effect and which
have not been disclosed in this Agreement or the Disclosure Schedule. No
representation or warranty of Issuer in this Agreement or any other
Transaction Agreement, nor any statement or certificate furnished or to be
furnished to Investor pursuant hereto or thereto, or in connection with the
transactions contemplated hereby or thereby, contains or will contain any
untrue statement of a material fact, or omits or will omit to state a
material fact necessary to make the statements contained herein or therein
not misleading.
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(z) Brokers. No broker, finder, or investment banker is entitled to
any brokerage, finder's, or other fee or commission in connection with the
transactions contemplated hereby based upon any Contract made by or on
behalf of Issuer.
SECTION . Representations and Warranties of Investor. As an inducement to
Issuer to enter into this Agreement, except as set forth in a writing delivered
by Investor prior to the date hereof, Investor hereby represents and warrants to
Issuer as follows:
(a) Organization and Authority. Investor is a corporation duly
organized, validly existing, and in good standing under the laws of the
State of Maryland, and has all necessary power and authority to enter into
this Agreement and each other Transaction Agreement to which it is a party,
to carry out its obligations hereunder and thereunder, and to consummate
the transactions contemplated hereby and thereby.
(b) Authorization, Execution and Delivery. The execution and delivery
of this Agreement and each other Transaction Agreement to which it is a
party by Investor, the performance by Investor of its obligations hereunder
and thereunder, and the consummation by Investor of the transactions
contemplated hereby and thereby have been duly authorized and approved by
all requisite action on the part of Investor. This Agreement has been, and
at the Closing each other Transaction Agreement to which it is a party will
have been, duly executed and delivered by Investor, and (assuming due
authorization, execution, and delivery by Issuer and each other party
thereto) this Agreement constitutes, and at the Closing each other
Transaction Agreement to which it is a party will constitute, a legal,
valid, and binding obligation of Investor enforceable against Investor in
accordance with its terms.
(c) No Conflict. The execution, delivery, and performance of this
Agreement and each other Transaction Agreement to which it is a party by
Investor do not and will not: (i) violate, conflict with, or result in the
breach of any provision of the certificate of incorporation or by-laws of
Investor; (ii) conflict with or violate any Law or Governmental Order
applicable to Investor; or (iii) conflict with, result in any breach of,
constitute a default (or event which with the giving of notice or lapse of
time or both would become a default) under, require any consent under, or
give to others any rights of termination, amendment, acceleration,
suspension, revocation or cancellation of, or result in the creation of any
Encumbrance on any of the assets or properties of Investor pursuant to, any
Contract to which Investor is a party or by which any of such assets or
properties is bound or affected.
11
(d) Governmental Consents and Approvals. The execution, delivery, and
performance of this Agreement and each other Transaction Agreement to which
it is a party by Investor do not and will not require any consent,
approval, authorization, or other order of, action by, filing with, or
notification to, any Governmental Authority.
(e) Investment Purpose, Knowledge and Experience. Investor is
acquiring the Shares and the Initial Warrants for its own account, not as a
nominee or agent, solely for the purpose of investment and not with a view
to, or for offer or sale in connection with, any distribution thereof.
Investor has such knowledge and experience in financial and business
matters that it is capable of evaluating the merits and risks of its
purchase of the Shares and the Initial Warrants, is able to bear the
economic risk of such investment for an indefinite period of time, and has
sufficient financial resources available to support the complete loss of
its investment the Shares and the Initial Warrants.
SECTION 7. Access to Information. From the date hereof until the earlier of
the Closing or the termination hereof in accordance with its terms, upon
reasonable notice, Issuer shall and shall cause its Representatives and each
Subsidiary and their respective Representatives: (i) to afford Investor and its
Representatives reasonable access, during normal business hours, to the offices,
properties, other facilities, books, and records of Issuer and each Subsidiary
and to those of their respective Representatives who have any knowledge relating
to Issuer or any Subsidiary; and (ii) to furnish to Investor and its
Representatives such additional financial and operating data and other
information regarding the business, assets, properties, and goodwill of Issuer
and each Subsidiary as Investor may reasonably request from time to time.
SECTION 8. Regulatory and Other Authorizations; Notices and Consents.
Issuer shall use its best efforts to obtain or cause to be obtained all
authorizations, consents, orders, and approvals of all Governmental Authorities
and officials that may be or become necessary for its execution and delivery of,
and the performance of its obligations pursuant to, this Agreement and shall
cooperate fully with Investor in promptly seeking to obtain all such
authorizations, consents, orders, and approvals. Issuer shall promptly give or
cause to be given such notices to third parties and use its best efforts to
obtain or cause to be obtained such third party consents and estoppel
certificates (including, without limitation appropriate evidence of the
satisfaction of the Stockholder Approval Requirement) as Investor may in its
sole and absolute discretion deem necessary, appropriate, or desirable in
connection with the transactions contemplated hereby. To the best knowledge of
Issuer, there exist no facts, circumstances, or conditions that could reasonably
be expected to result in the failure of Issuer to obtain each consent, approval,
and authorization necessary, appropriate, or desirable for the consummation of
the transactions contemplated hereby.
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SECTION 9. Notice of Developments. From the date hereof until
the earlier of the Closing or the termination hereof in accordance with its
terms, Issuer shall promptly notify Investor in writing of: (a) all events,
facts, circumstances, conditions, and occurrences arising subsequent to the date
hereof which could reasonably be expected to result in any breach of any
representation, warranty, covenant, or agreement of Issuer contained herein, or
which could reasonably be expected to have the effect of making any
representation or warranty of Issuer contained herein untrue, incomplete, or
incorrect in any material respect; and (b) all other material developments
affecting the assets, liabilities, business, financial condition, operations,
results of operations, or prospects of Issuer.
SECTION 10. Ordinary Course of Business; Closing Efforts. From
the date hereof until the earlier of the Closing or the termination hereof in
accordance with its terms: (a) Issuer shall carry on its business in the usual,
regular and ordinary course in all material respects, in substantially the same
manner as previously conducted, and shall use all reasonable efforts to preserve
intact its rights and franchises and preserve its relationships with customers,
suppliers and others having business dealings with it to the end that its
ongoing business shall not be impaired in any material respect at the Closing;
and Issuer shall not enter into any new line of business or incur or commit to
any capital expenditures or any Liabilities in connection therewith other than
capital expenditures and Liabilities incurred or committed to in the ordinary
course of business consistent with past practice; and (b) Issuer shall use its
best efforts to take, or cause to be taken, all actions and to do, or cause to
be done, all things necessary, proper or advisable under this Agreement and
applicable Laws to consummate the purchase and sale of the Shares and the
Initial Warrants as contemplated by this Agreement as soon as practicable after
the date hereof, including: (i) preparing and filing as promptly as practicable
all documentation to effect all necessary applications, notices, petitions,
filings, ruling requests and other documents and to obtain as promptly as
practicable all proxies, consents, waivers, licenses, orders, registrations,
approvals, permits, rulings and authorizations necessary or advisable to be
obtained from Issuer's stockholders and any Third Party and/or Governmental
Authority in order to consummate the purchase and sale of the Shares and the
Initial Warrants contemplated by this Agreement; and (ii) taking all reasonable
steps as may be necessary to obtain all such material proxies, consents,
waivers, licenses, registrations, permits, authorizations, rulings, orders, and
approvals.
SECTION 11. No Solicitation or Negotiation. From the date
hereof until the earlier of the Closing or the termination hereof in accordance
with its terms and except as expressly provided in Section 11 of the Disclosure
Schedule, Issuer shall not, and shall cause its controlled Affiliates and other
Representatives not to, directly or indirectly: (a) solicit, initiate, consider,
encourage, or accept any other proposals or offers from any Person relating to:
(i) any acquisition or purchase of all or any portion of the capital stock or
assets (other than sales of non-material assets of Issuer in the ordinary course
of Issuer's business) of Issuer or any Subsidiary; (ii) any business combination
with Issuer or any Subsidiary; or (iii) any other extraordinary business
transaction involving or otherwise relating to Issuer or any Subsidiary; or (b)
participate in any discussions, conversations, negotiations, or other
communications regarding, or furnish to any other Person any information with
respect to, or otherwise cooperate in any way, assist or participate in,
facilitate or encourage any effort or attempt by any other Person to seek to do
any of the foregoing; provided, however, that nothing contained in this section
shall prohibit the board of directors of Issuer from: (i) considering,
negotiating, and approving and recommending to the stockholders of Issuer the
contemporaneous investment in Issuer by an investor satisfactory to Investor in
its sole discretion on substantially the same terms and conditions set forth
herein; (ii) complying with Rule 14e-2 promulgated under the Exchange Act with
regard to a tender or exchange offer; or (iii) after receiving the advice of
outside counsel to the effect that the board of directors of Issuer is required
to do so in order to discharge properly its fiduciary duties, considering,
negotiating, and approving and recommending to the stockholders of Issuer an
unsolicited bona fide written acquisition proposal relating to the sale of the
entire company, which acquisition proposal was not received in violation of this
section. Issuer shall promptly notify Investor if any such proposal or offer, or
any inquiry or other contact with any Person with respect thereto, is or has
been made and shall, in any such notice to Investor, indicate in reasonable
detail the identity of the Person making such proposal, offer, inquiry, or
contact and the terms and conditions of such proposal, offer, inquiry, or other
contact. Neither Issuer nor any Subsidiary shall, without the prior written
consent of Investor, release any Person from, or waive any provision of, any
confidentiality or standstill agreement to which Issuer or any Subsidiary is a
party.
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SECTION 12. Conditions to Closing. (a) The obligations of Issuer to
consummate the transactions contemplated hereby shall be subject to the
fulfillment, at or prior to the Closing, of each of the following conditions:
(i) Representations, Warranties and Covenants. The representations and
warranties of Investor contained herein shall have been true and complete
when made and shall be true and complete in all material respects as of the
Closing Date, with the same force and effect as if made as of such date,
other than such representations and warranties as are made as of another
date, which shall remain true and complete in all material respects as of
such other date; and the covenants and agreements contained herein to be
performed or observed by Investor at or prior to the Closing shall have
been performed or observed in all material respects.
(ii) Stockholder Approval. The stockholders of Issuer shall have duly
approved the terms of, and the execution by Issuer of, each of the
Transaction Agreements to which it is a party.
(iii) No Actions; Laws. No Action shall have been commenced or
threatened by or before any Governmental Authority against Issuer or
Investor, and no Law shall have been enacted, issued, promulgated,
enforced, or entered, that could reasonably be expected to restrain,
prohibit, invalidate, render impossible or unlawful, or otherwise
materially and adversely affect the transactions contemplated hereby;
provided, however, that the provisions of this paragraph shall not apply if
Issuer shall have solicited or encouraged, directly or indirectly, any such
Action or Law.
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(b) The obligations of Investor to consummate the transactions
contemplated hereby shall be subject to the fulfillment, at or prior to the
Closing, of each of the following conditions:
(i) Representations, Warranties and Covenants. The representations and
warranties of Issuer contained herein shall have been true and complete
when made and shall be true and complete in all material respects as of the
Closing Date, with the same force and effect as if made as of such date,
other than such representations and warranties as are made as of another
date, which shall remain true and complete in all material respects as of
such other date; and the covenants and agreements contained herein to be
performed or observed by Issuer at or prior to the Closing shall have been
performed or observed in all material respects.
(ii) Transaction Agreements. Each Transaction Agreement shall have
been executed and delivered by the parties thereto and shall be in full
force and effect on the Closing Date, and there shall exist no facts,
circumstances, or conditions that constitute or, with the giving of notice
or lapse of time or both, could constitute a default thereunder or breach
thereof or could give any party thereto the right to terminate such
agreement.
(iii) No Actions; Laws. No Action shall have been commenced or
threatened by or before any Governmental Authority against Issuer or
Investor, and no Law shall have been enacted, issued, promulgated,
enforced, or entered, that could reasonably be expected: (A) to restrain,
prohibit, invalidate, render impossible or unlawful, or otherwise
materially and adversely affect the transactions contemplated hereby; or
(B) to result in a Material Adverse Effect; provided, however, that the
provisions of this paragraph shall not apply if Investor shall have
solicited or encouraged, directly or indirectly, any such Action or Law.
(iv) Contemporaneous Investment. Issuer shall have received aggregate
net proceeds of not less than $1,000,000 from the issuance and sale of
shares of Common Stock to one or more investors other than Investor, at a
price per share of not less than $1.50, in a financing transaction
consummated subsequent to the date first above written.
(v) Board Representation. Starwood's initial designee to serve as a
member of the board of directors of Issuer shall have been duly appointed
or elected to such office.
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(vi) Pizzeria Uno Disposition. Issuer shall have consummated the sale
of its South Plainfield, New Jersey Pizzeria Uno restaurant for not less
than $700,000 in gross cash proceeds to Issuer.
(vii) HRP Amendment. Issuer and Hotel Restaurant Properties, Inc.
shall have executed and delivered to Investor an amendment to their
agreement, dated August 27, 1998, and amended as of August 10, 1998 and May
11, 1999, which shall be in the form attached hereto as Exhibit H.
(viii) Westin Michigan Avenue Release. Issuer shall have executed and
delivered to Investor, in exchange for a payment of not more than $25,000,
a settlement and release agreement in the form attached hereto as Exhibit I
relating to the Issuer restaurant in the Westin Michigan Avenue.
(ix) Officers' and Secretary's Certificate. Investor shall have
received from the president and the chief financial officer of Issuer and
from the secretary of Issuer executed certificates dated the Closing Date,
substantially in the forms attached hereto as Exhibits B and C,
respectively.
(x) Legal Opinions. Investor shall have received from Herzog, Fisher,
▇▇▇▇▇▇▇ & ▇▇▇▇▇, and ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇▇▇▇, each counsel to Issuer, legal
opinions in form and substance reasonably satisfactory to Investor.
(xi) Share and Warrant Certificates. Investor shall have received the
Share Certificate and the Initial Warrants Certificate, each duly
authorized and executed by Issuer.
(xii) Consents and Approvals. The stockholders of Issuer shall have
duly approved the terms of, and the execution by Issuer of, each of the
Transaction Agreements to which it is a party. Investor and Issuer shall
have received, each in form and substance satisfactory to Investor, all
authorizations, consents, orders, and approvals of all Governmental
Authorities and officials and all third party consents and estoppel
certificates and all corporate approvals (including, without limitation
appropriate evidence of the satisfaction of the Stockholder Approval
Requirement) which Investor reasonably deems necessary, appropriate, or
desirable for the consummation of the transactions contemplated hereby.
(xiii) No Material Adverse Effect. No event or events shall have
occurred, or shall be reasonably likely to occur, which, individually or in
the aggregate, have resulted in or could reasonably be expected to result
in a Material Adverse Effect.
SECTION 13. Termination. This Agreement may be terminated by written notice
of termination at any time prior to the Closing:
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(a) by Investor if: (i) any event or condition occurs that results in,
or could reasonably be expected to result in, a Material Adverse Effect;
(ii) any representation or warranty of Issuer contained herein was not true
and complete in all material respects when made; (iii) Issuer does not
comply in all material respects with each covenant or agreement contained
herein to be performed or observed by it; or (iv) Issuer makes a general
assignment for the benefit of creditors, or any proceeding is instituted by
or against Issuer seeking to adjudicate it a bankrupt or insolvent, or
seeking the liquidation, winding up, or reorganization, arrangement,
adjustment, protection, relief, or composition of its debts under any Law
relating to bankruptcy, insolvency, or reorganization;
(b) by Issuer if: (i) any representation or warranty of Investor
contained herein was not true and complete in all material respects when
made; or (ii) Investor does not comply in all material respects with each
covenant or agreement contained herein to be performed or observed by it;
(c) by Investor or Issuer if the Closing has not occurred within
thirty (30) days after the date of Issuer's annual stockholders' meeting
with respect to fiscal year 2000, which is anticipated to occur on June 25,
2001; provided, however, that the right to terminate this Agreement
pursuant to this clause shall not be available to any party whose failure
to fulfill any obligation hereunder is the cause of, or results in, the
failure of the Closing to occur on or prior to such date;
(d) by Investor or Issuer if any Governmental Authority issues any
order, decree, or ruling or takes any other action restraining, enjoining,
or otherwise prohibiting the transactions contemplated hereby and such
order, decree, ruling, or other action becomes final and nonappealable; or
(e) by the mutual written consent of Investor and Issuer.
SECTION 14. Use of Proceeds. Issuer shall use the proceeds received from
the sale of the Shares hereunder for working capital purposes and shall not use
any of such proceeds for repayment of any of Issuer's outstanding indebtedness.
SECTION 15. Senior Management. Issuer shall use its best efforts to retain
pursuant to a written employment contract ▇▇▇▇▇▇ ▇▇▇▇▇▇ as the chief executive
officer of Issuer for at least the three-year period commencing on the Closing
Date, with the compensation package described in Section 15 of the Disclosure
Schedule.
SECTION 16. Indemnification; Contribution. Indemnification. Each party
hereto (in its capacity as indemnitor hereunder, the "Indemnitor"), shall
indemnify the other party hereto, each Affiliate of such other party, each
successor and assign of each such Person, and each Representative of each of the
foregoing (each such Person in its capacity as indemnitee hereunder, an
"Indemnitee"), with respect to, and hold each of them harmless from and against,
any and all Losses resulting from, arising out of, or relating to Indemnitor's
breach of any representation, warranty, covenant, or agreement thereof contained
in this Agreement or any other Transaction Agreement, and any action or omission
of Indemnitor in connection with the performance of its obligations under this
Agreement or any other Transaction Agreement.
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(b) Contribution. To the extent that the undertakings of Indemnitor
set forth in this section may be unenforceable, Indemnitor shall contribute
the maximum amount that it is permitted to contribute under applicable Law
to the payment and satisfaction of all Losses incurred by any Indemnitee.
(c) Loss Notices. If any Indemnitee determines that any facts or
circumstances have given or could reasonably be expected to give rise to a
right of indemnification under this section, such Indemnitee shall give
Indemnitor notice (a "Loss Notice") of such facts or circumstances within
thirty days of such determination, stating the amount of the Loss, if
known, and method of computation thereof, and describing in reasonable
detail the facts and circumstances upon which such determination is based;
provided that, if any such determination is based, in whole or in part, on
any Action brought by or on behalf of any third party (a "Third-Party
Claim"), such Indemnitee shall give Indemnitor a Loss Notice in respect
thereof within ten days of such determination; provided further that any
failure timely to provide a Loss Notice shall not release Indemnitor from
any of its obligations under this section, except to the extent Indemnitor
is materially prejudiced by such failure, and shall not relieve Indemnitor
from any other obligation or liability that it may have to any Indemnitee
otherwise than under this section.
(d) Third-Party Claims. If Indemnitor acknowledges in writing within
five Business Days after its receipt of any Loss Notice relating to any
Third-Party Claim its obligation to indemnify and hold harmless any
Indemnitee under this section from and against any Losses resulting from
such Third-Party Claim, then Indemnitor shall be entitled to assume and
control the defense of such Third-Party Claim at its expense and through
counsel of its choice (which counsel shall be reasonably acceptable to such
Indemnitee); provided that, if there exists or is reasonably likely to
exist a conflict of interest that would make it inappropriate in the
judgment of such Indemnitee for the same counsel to represent both such
Indemnitee and Indemnitor, then such Indemnitee shall be entitled to retain
its own counsel, at Indemnitor's sole cost and expense, in each
jurisdiction for which such Indemnitee reasonably determines counsel is
required. If Indemnitor is, directly or indirectly, conducting the defense
against any Third-Party Claim, Indemnitee shall cooperate with Indemnitor
in such defense and make available to Indemnitor all witnesses, pertinent
records, materials, and information in such Indemnitee's possession or
under its control relating thereto as is reasonably required by Indemnitor.
If any Indemnitee is, directly or indirectly, conducting the defense
against any Third-Party Claim, Indemnitor shall cooperate with such
Indemnitee in such defense and make available to such Indemnitee, at
Indemnitor's sole cost and expense, all such witnesses, records, materials,
and information in Indemnitor's possession or under its control relating
thereto as is reasonably required by such Indemnitee. Indemnitor shall not
settle any Third-Party Claim without the prior written consent of the
Indemnitee which delivered the Loss Notice in respect thereof.
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(e) Other Rights and Remedies Not Affected. The indemnification rights
of the parties under this section are independent of and in addition to
such rights and remedies as the parties may have at law or in equity or
otherwise for any misrepresentation, breach of warranty, or failure to
fulfill any agreement or covenant hereunder on the part of any party
hereto, including, without limitation, the right to seek specific
performance, rescission, or restitution, none of which rights or remedies
shall be affected or diminished hereby.
SECTION 17. Miscellaneous. (a) Further Action. Issuer shall, promptly after
any request therefor by Investor and at Issuer's sole cost and expense, take or
cause to be taken all actions, do or cause to be done all things, and execute
and deliver or cause to be executed and delivered all documents, instruments,
certificates, further assurances, or other papers, which Investor may reasonably
deem necessary, appropriate, or desirable in connection with this Agreement and
the consummation of the transactions contemplated hereby.
(b) Survival of Certain Covenants and Agreements. Issuer's
covenants and representations and agreements contained in Sections 5, 14, 15,
16, and 17 shall survive the Closing; and Issuer's covenants and representations
and agreements contained in Sections 5, 16, and 17 shall survive the termination
or expiration hereof.
(c) Expenses. Except as otherwise provided herein each party
hereto shall pay its own costs and expenses, including, without limitation, all
fees and disbursements of counsel, incurred by or on behalf of such party in
connection with this Agreement and the consummation of the transactions
contemplated hereby; provided, however, that, if a final and binding judgment is
obtained by any party to this Agreement against any other party to this
Agreement in any Designated Action, such judgment debtor shall pay all
out-of-pocket costs and expenses (including, without limitation, reasonable fees
and disbursements of counsel, accountants, experts, and consultants) incurred by
such judgment creditor in connection with or resulting from such Designated
Action.
(d) Notices. Any notice, request, claim, demand, or other
communication given or made hereunder by any party hereto shall be in writing
and shall be given or made by delivery in person, or by reputable overnight
business courier service, telecopy, or registered or certified mail (postage
prepaid, return receipt requested) to the addressee at its address or telecopier
number set forth in Schedule II hereto (or to such other address or telecopier
number as such party may hereafter specify for such purpose by notice given in
accordance with this paragraph). Any notice, request, claim, demand, or other
communication given or made hereunder by telecopy shall be followed promptly by
a confirmation copy sent by reputable overnight business courier service. Any
notice, demand, request, or other communication hereunder shall be effective
upon the earliest of: (i) the receipt thereof by the addressee; (ii) the deposit
thereof in the mails of the United States of America; provided, however, that
the time period in which any response to any such notice, demand, request, or
other communication is required to be given shall commence from the date of
receipt thereof by the addressee as evidenced by the return receipt with respect
thereto; (iii) the rejection or other refusal of delivery thereof by the
addressee or any agent of the addressee; or (iv) the failure of delivery thereof
as a result of the addressee's failure to properly give notice hereunder of any
change of its address or telecopier number.
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(e) Assignment. Except as otherwise provided herein, no party hereto shall
assign its rights or delegate its obligations hereunder by operation of law or
otherwise without each other party's express written consent (which consent may
be granted or withheld in such party's sole and absolute discretion); provided
that Investor may assign in whole or in part its rights hereunder to any
Affiliate thereof without the consent of Issuer; and either party hereto may
assign in whole or in part its rights hereunder to any Person that acquires more
than 50% of the outstanding voting securities or all or substantially all of the
assets of the assigning party (whether by way of merger or otherwise).
Notwithstanding anything to the contrary contained in this Agreement, Issuer
shall not assign in whole or in part any of its rights or delegate any of its
obligations hereunder to any acquiror thereof that is a Major Hotel Operator (as
defined in Section 3(a) of the Development Agreement) other than Investor until
the later to occur of : (A) the Closing Date; and (B) the expiration pursuant to
its terms of Issuer's exclusivity covenant in Section 3(b) of the Development
Agreement.
(f) Amendment; Waiver. No amendment or restatement hereof or supplement or
other modification hereto shall be valid or effective unless such amendment,
restatement, supplement, or other modification is in writing, expressly refers
hereto, and is signed by each party hereto. No consent to, or waiver, discharge,
or release of, any term or provision or breach hereof shall be valid or
effective unless such consent, waiver, discharge, or release is in writing,
expressly refers hereto, and is signed by the party to be bound thereby, and no
such consent, waiver, discharge, or release shall constitute a consent, waiver,
discharge, or release of any other term or provision hereof or any subsequent
breach hereof, whether or not similar in nature, or a subsequent consent,
waiver, discharge, or release of the same term, provision, or breach hereof. No
failure to exercise or delay in exercising any right, power, or remedy hereunder
by either party hereto, including any failure to insist in any instance upon
strict, complete, or timely performance or observance by the other party hereto
of any term or provision hereof or obligation hereunder, shall constitute a
consent, waiver, discharge, or release of any such right, power, or remedy, and
no single or partial exercise of any right, power, or remedy by either party
hereto shall preclude any other or further exercise of any such right, power, or
remedy.
(g) Entire Agreement. This Agreement, including all annexes, appendices,
exhibits, and schedules hereto, constitutes the entire agreement between the
parties hereto with respect to the subject matter hereof and supersedes all
prior or contemporaneous negotiations, covenants, agreements, representations,
warranties, undertakings, and understandings, written or oral, and courses of
conduct and dealing between the parties hereto, with respect to the subject
matter hereof.
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(h) Severability. If any term or other provision hereof is determined by
any court of competent jurisdiction to be invalid, illegal, or unenforceable in
whole or in part by reason of any applicable Law or public policy, and such
determination becomes final and nonappealable, such term or other provision
shall remain in full force and effect to the fullest extent permitted by Law,
and all other terms and provisions hereof shall remain in full force and effect
in their entirety.
(i) Successors and Assigns; No Third-Party Beneficiaries. This Agreement
shall be binding upon and inure solely to the benefit of the parties hereto and
their respective successors and permitted assigns, and nothing herein, whether
express or implied, is intended to or shall confer upon any other Person any
legal or equitable right, power, or remedy of any kind, nature, or description
whatsoever under or by reason hereof; provided, however, that the terms and
provisions hereof relating to indemnification of any indemnitee not party hereto
shall inure to the benefit of such indemnitee.
(j) Remedies. (i) All rights, powers, and remedies hereunder of each party
hereto shall, to the fullest extent permitted by law, be cumulative and not
alternative, and in addition to all other rights, powers, and remedies of such
party, whether specifically granted hereunder or otherwise existing under any
Law, and may be exercised from time to time and as often and in such order as
such party may deem necessary, appropriate, or desirable, and the exercise or
the beginning of the exercise of any right, power, or remedy shall not be
construed to be a waiver of the right to exercise at the same time or thereafter
any other right, power, or remedy.
(ii) Issuer hereby acknowledges that irreparable damage would occur, and
Investor's remedies at law would be inadequate, if any term or provision hereof
was not performed or observed strictly in accordance herewith, and hereby
unconditionally and irrevocably waives any defense that may be available to it
that Investor's remedies at law are adequate or that its injuries are not
irreparable. Investor may, without posting any bond or other security and in
addition to any remedy available to it at law, obtain equitable relief in the
form of specific performance, temporary restraining order, temporary or
permanent injunction, or any other equitable remedy which may then be available
to it.
(k) Governing Law. This Agreement shall be governed by, and construed and
enforced in accordance with, the laws of the State of California.
(l) Waiver of Jury Trial. Each party hereto hereby unconditionally and
irrevocably waives all right to trial by jury in any action, suit, or proceeding
(whether based on contract, tort, or otherwise) based upon, resulting from,
arising out of, or relating to this Agreement or any transaction or agreement
contemplated hereby.
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(m) Jurisdiction; Service of Process. Each party hereto hereby
unconditionally and irrevocably submits, for itself and its property, to the
exclusive jurisdiction of the Designated Courts over any Designated Action. All
claims with respect to any Designated Action shall be heard and determined in a
Designated Court. No party hereto shall commence any Designated Action except in
a Designated Court. No party hereto shall, and each party hereto hereby waives
any right it may have to: (i) plead or make any objection to the venue of any
Designated Court; (ii) plead or make any claim that any Designated Action
brought in any Designated Court has been brought in an improper or otherwise
inconvenient forum; (iii) plead or make any claim that any Designated Court
lacks personal jurisdiction over it; or (iv) seek any punitive damages in any
Designated Action. Any final Governmental Order in any Designated Action shall
be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by law. The summons and complaint or any other
process in any Designated Action may be served by mailing to any of the
addresses set forth herein or by hand delivery to an individual of suitable age
and discretion at any such address, and any such service shall be deemed to be
complete on the date such process is so mailed or delivered and to have the same
force and effect as personal service within the State of California.
(n) Preparation and Negotiation of This Agreement. Each party hereto has
participated equally in the preparation and negotiation of this Agreement,
including all annexes, appendices, exhibits, and schedules hereto, and each
party hereto hereby unconditionally and irrevocably waives to the fullest extent
permitted by law any rule of interpretation or construction requiring that this
Agreement, including any annex, appendix, exhibit, or schedule hereto, be
interpreted or construed against the drafting party.
(o) Headings. The descriptive headings contained herein are for convenience
of reference only and shall not affect in any way the meaning, construction, or
interpretation of any term or provision hereof.
(p) Exhibits. Each annex, appendix, exhibit, and schedule hereto is hereby
incorporated herein by reference in its entirety.
(q) Counterparts. This Agreement may be executed in any number of
counterparts and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original, and all of which taken
together shall constitute one and the same agreement with the same effect as if
such signatures were upon the same instrument.
(r) Delivery Via Telecopier. Delivery of an executed counterpart hereof via
telecopier shall be as effective as delivery of a manually executed counterpart
hereof.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
22
IN WITNESS WHEREOF, each party hereto has executed and
delivered this Agreement as of the date first written above.
GRILL CONCEPTS, INC.
By:
----------------------------------------
Name:
Title:
STARWOOD HOTELS AND RESORTS WORLDWIDE, INC.
By:
----------------------------------------
Name:
Title:
23
SCHEDULE II
CERTAIN DEFINED TERMS
"Action" means any claim (including, without limitation, any
Environmental Claim), action, suit, arbitration, inquiry, proceeding, notice of
violation, or investigation by or before any Governmental Authority.
"Adjusted Diluted Shares" means the Fully Diluted Shares less
those Securities issuable upon exercise of outstanding stock options or warrants
to the extent that (i) such Securities have an exercise price of not less than
$8.00 per share (as adjusted for stock splits, stock dividends,
recapitalizations and the like), and (ii) the Fair Market Value is less than
$8.00 per share (as adjusted for stock splits, stock dividends,
recapitalizations and the like).
"Affiliate" means, with respect to any specified Person, any
other Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with, such specified
Person. For purposes of this definition, "control" (including "controlled by"
and "under common control with") means, with respect to the relationship between
or among two or more Persons, the possession, directly or indirectly, or as
trustee, personal representative, or executor, of the power to direct or cause
the direction of the affairs or management of a Person, whether through the
ownership of voting securities, as trustee, personal representative, or
executor, by contract or otherwise, including, without limitation, the
ownership, directly or indirectly, of securities having the power to elect a
majority of the board of directors or similar body governing the affairs of such
Person.
"Agreement" means this subscription agreement, including all
annexes, appendices, exhibits, and schedules hereto, as amended, supplemented,
or otherwise modified from time to time.
"Assets" means, collectively, the properties, assets, and
Contract rights forming a part of or used, held for use, or intended to be used
in connection with, necessary for, or otherwise material to the conduct of, the
business and operations of Issuer and each Subsidiary, including, without
limitation, the Owned Intellectual Property, the Licensed Intellectual Property,
the Owned Real Property, and the Leased Real Property.
"Business Day" means any day that is not a Saturday, a Sunday,
or another day on which banks are required or authorized by Law to be closed in
New York, New York or Los Angeles, California.
"Closing" means the closing of the sale, issuance, and
delivery of the Shares and the Warrants contemplated by Section 3 to be held at
10:00 a.m., local time, on the Closing Date at the offices of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇
LLP, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇, or at such other
place or at such other time as Issuer and Investor may mutually agree upon in
writing.
24
"Closing Date" means the later of: (i) the date hereof; and
(ii) the fifteenth (15th) Business Day following the satisfaction or waiver of
all conditions to the obligations of the parties set forth in Section 12.
"Commission" means the United States Securities and Exchange
Commission.
"Common Stock" has the meaning specified in the recitals
hereto.
"Contract" means any contract, agreement, lease, sublease,
license, sublicense, guaranty, letter of credit, credit or loan agreement,
pledge or security agreement, note, bond, mortgage, deed of trust, indenture,
commitment, sale or purchase order, or other understanding or arrangement,
written or oral, of any kind, nature, or description whatsoever, or any waiver,
consent, or other authorization relating to any of the foregoing.
"Designated Action" means any Action based upon, resulting
from, arising out of, or relating to this Agreement or any transaction or
agreement contemplated hereby, or for the recognition or enforcement of any
judgment resulting from any such Action.
"Designated Court" means any court of the State of California
and any federal court of the United States of America, in either case, sitting
in the City and County of Los Angeles, and any appellate court therefrom.
"Disclosure Schedule" means the Disclosure Schedule attached
hereto, dated as of the date hereof, and forming a part hereof.
"Development Agreement" has the meaning specified in the
recitals hereto.
"Encumbrance" means any security interest, pledge, mortgage,
lien (including, without limitation, any environmental or tax lien), charge,
encumbrance, adverse claim, preferential arrangement, or restriction of any
kind, nature, or description whatsoever, including, without limitation, any
restriction on the use, voting, transfer, receipt of income, or other exercise
of any attributes of ownership.
"Environmental Claim" means any action, suit, demand, demand
letter, claim, lien, notice of non-compliance or violation, notice of liability
or potential liability, investigation, proceeding, consent order, or consent
agreement relating in any way to any Environmental Law, Environmental Permit, or
Hazardous Materials.
"Environmental Law" shall mean any Law, now or hereafter in
effect and as amended, and any judicial or administrative interpretation
thereof, including any judicial or administrative order, consent decree, or
judgment, relating to pollution or protection of the environment, health,
safety, or natural resources, including, without limitation, those relating to
the use, handling, transportation, treatment, storage, disposal, release, or
discharge of Hazardous Materials.
25
"Environmental Permit" shall mean any permit, approval,
identification number, license, or other authorization required under any
applicable Environmental Law.
"Exchange Act" means, as of any date of determination, the
Securities Exchange Act of 1934, as amended, or any similar federal statute, and
the rules and regulations of the Commission thereunder, all as in effect as of
such date.
"Exchange Act Documents" has the meaning specified in Section
5(e).
"Fair Market Value" means, with respect to the Common Stock
and as of any date of determination: (i) if such Common Stock is listed on any
national securities exchange of the United States of America, the average of the
closing sale prices of such securities on the principal such exchange on which
such Common Stock is listed (or, on any trading day during such period on which
there were no sales, the average of the highest bid and lowest asked prices on
such exchange at the end of such day) on each trading day during the thirty-day
period ending on the last Business Day immediately preceding such date of
determination; (ii) if such Common Stock is not listed on any national
securities exchange of the United States of America but is quoted on the Nasdaq
System, the average of the representative bid and asked prices quoted on such
system as of 4:00 p.m., New York time, on each trading day during the thirty-day
period ending on the last Business Day immediately preceding such date of
determination; (iii) if such Common Stock is not listed on any national
securities exchange of the United States of America and is not quoted on the
Nasdaq System, the average of the highest bid and lowest asked prices in the
domestic over-the-counter market as reported by the National Quotation Bureau
Incorporated on each trading day during the thirty-day period ending on the last
Business Day immediately preceding such date of determination; or (iv) if such
Common Stock is not then publicly traded, the fair value of such Common Stock as
determined in good faith and certified by the board of directors of Issuer,
which determination shall be final and binding absent manifest error.
"Financial Statements" means the audited consolidated balance
sheets of Issuer and the Subsidiaries as at, and the related audited
consolidated statements of operations, stockholders' equity, and cash flows of
Issuer and the Subsidiaries for the fiscal year ended as of December 31, 2000,
together with all related notes and schedules thereto, accompanied by the
reports thereon of Issuer's independent public accountants, in the form as filed
with the Commission as part of an Exchange Act Document.
"Fully-Diluted Shares" means, as of any date of determination,
the sum of: (i) the aggregate number of shares of Common Stock issued and
outstanding as of such date (excluding any shares of Common Stock held in the
treasury of Issuer or held by any controlled Affiliate of Issuer); plus (ii) the
number of shares of Common Stock issuable upon the exercise, conversion, or
exchange of all outstanding options, warrants, convertible securities, and other
rights, agreements, arrangements, or commitments of any kind, nature, or
description whatsoever relating to the capital stock of Issuer or obligating
Issuer to issue or sell any shares of capital stock of, or any other interest
in, Issuer.
26
"Governmental Authority" means any national, federal, state,
municipal, local, or other government, governmental, regulatory, or
administrative authority, agency, or commission, or any court, tribunal, or
judicial or arbitral body.
"Governmental Order" means any order, writ, judgment,
injunction, decree, stipulation, determination, or award entered by or with any
Governmental Authority.
"Hazardous Materials" means: (i) petroleum and petroleum
products, by products, or breakdown products, radioactive materials, asbestos
containing materials, and polychlorinated biphenyls; and (ii) any other
chemicals, materials, or substances defined or regulated as toxic or hazardous
or as a pollutant or contaminant or as a waste under any applicable
Environmental Law.
"Indemnitee" has the meaning specified in Section 16(a).
"Indemnitor" has the meaning specified in Section 16(a).
"Initial Warrant Certificate" means the warrant certificate of
Issuer evidencing the Initial Warrants, substantially in the form attached
hereto as Exhibit G.
"Initial Warrants" has the meaning specified in the recitals
hereto.
"Initial Warrant Shares" has the meaning specified in the
recitals hereto.
"Intellectual Property" means, collectively: all original
works of authorship or copyrights fixed in any tangible medium of expression;
all interests patent of the United States of America or any other country; all
trademarks, trade names, trade styles, trade dress, service marks, logos,
designs, corporate names, and other similar general intangibles; and all other
intellectual property, including, without limitation, to the extent not
constituting any of the foregoing, all inventions, ideas, moral rights, computer
software, technology (including know-how and show-how), trade secrets, and other
confidential, proprietary, technical, and business information of any kind,
nature, or description whatsoever.
"Investor" has the meaning specified in the preamble hereto.
"Investor Rights Agreement" means the investor rights
agreement to be entered into between Issuer and Investor at or prior to the
Closing, substantially in the form attached hereto as Exhibit D.
27
"Issuer" has the meaning specified in the preamble hereto.
"Key Employee" has the meaning specified in Section 5(r).
"Law" means any international, national, federal, state,
provincial, municipal, local, or other statute, law, ordinance, regulation,
rule, code, order, or other requirement or rule of law.
"Leased Real Property" means all real property leased by
Issuer or any Subsidiary as tenant, together with, to the extent leased by
Issuer or any Subsidiary, all buildings and other structures, facilities, or
improvements currently or hereafter located thereon, all fixtures, systems,
equipment and items of personal property of Issuer or any Subsidiary attached or
appurtenant thereto, and all easements, licenses, rights, and appurtenances
relating to the foregoing.
"Liabilities" means all debts, liabilities, and obligations of
any kind, nature, or description whatsoever, whether accrued or fixed, absolute
or contingent, matured or unmatured, known or unknown or determined or
determinable, including, without limitation, those arising under any Law
(including, without limitation, any Environmental Law), Action, or Governmental
Order and those arising under any Contract.
"Licensed Intellectual Property" means all Intellectual
Property licensed or sublicensed by Issuer or any Subsidiary, as licensee.
"Losses" means, with respect to any specified Person, all
Liabilities, losses, damages, claims, costs, expenses, amounts paid in
settlement, interest, awards, judgments, penalties, or fines of any kind,
nature, or description whatsoever (including, without limitation, all reasonable
fees and disbursements of counsel, accountants, experts, and consultants)
suffered, incurred, or sustained by such Person or to which such Person becomes
subject (including, without limitation, in connection with any Action brought or
otherwise initiated by or on behalf of such Person), resulting from, arising out
of, or relating to any specified facts or circumstances.
"Loss Notice" has the meaning specified in Section 16(c).
"Material Adverse Effect" means any circumstance, change in,
or effect on Issuer, or any Subsidiary which, individually or in the aggregate
with any other circumstances, changes in, or effects on Issuer, or any
Subsidiary is, or could reasonably be expected to be, materially adverse to the
business, operations, assets or liabilities, employee relationships, customer or
supplier relationships, prospects, results of operations, or the condition
(financial or otherwise) of Issuer and the Subsidiaries, taken as a whole.
28
"Material Assets" means all Assets of Issuer or any of its
Subsidiaries that are material, individually or in the aggregate, to the
business or operations of Issuer and its Subsidiaries, taken as a whole.
"Material Contracts" means all Contracts to which Issuer or
any of its Subsidiaries are a party or by which the Assets of Issuer or any of
its Subsidiaries are bound that are material, individually or in the aggregate,
to the business or operations of Issuer and its Subsidiaries, taken as a whole.
"NASD" has the meaning specified in Section 5(w).
"Owned Intellectual Property" means all Intellectual Property
owned by Issuer or any Subsidiary.
"Owned Real Property" means all real property owned by Issuer
or any Subsidiary, together with all buildings and other structures, facilities,
or improvements currently or hereafter located thereon, all fixtures, systems,
equipment, and items of personal property of Issuer or any Subsidiary attached
or appurtenant thereto, and all easements, licenses, rights, and appurtenances
relating to the foregoing.
"Permit" means any license, permit, franchise, certificate, or
other authorization or approval of any kind, nature, or description whatsoever
issued by any Governmental Authority.
"Permitted Encumbrances" means such of the following as to
which no enforcement, collection, execution, levy or foreclosure proceeding
shall have been commenced: (i) liens for taxes, assessments and governmental
charges or levies not yet due and payable which are not in excess of $7,500 in
the aggregate; (ii) Encumbrances imposed by Law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's liens and other similar liens
arising in the ordinary course of business securing obligations that: (A) are
not overdue for a period of more than thirty days; and (B) are not in excess of
$7,500 in the case of a single property or $15,000 in the aggregate at any time;
(iii) pledges or deposits to secure obligations under workers' compensation laws
or similar legislation or to secure public or statutory obligations; and (iv)
minor survey exceptions, reciprocal easement agreements, and other customary
encumbrances on title to real property that: (A) were not incurred in connection
with any indebtedness; (B) do not render title to the property encumbered
thereby unmarketable; and (C) do not, individually or in the aggregate,
materially adversely affect the value or use of such property for its current
and anticipated purposes.
"Permitted Transferee" means, with respect to Investor or any
Stockholder (as defined in the preamble to the Stockholders' Agreement), (i) a
natural person who is the issue or spouse of such Stockholder and to whom
Securities are transferred: (a) by will or the laws of descent and distribution;
or (b) by gift without consideration of any kind; (ii) any charitable foundation
all the trustees of which are Stockholders or otherwise Permitted Transferees;
and Investor or any Affiliate of Investor.
29
"Person" means any individual, partnership, firm, corporation,
limited liability company, joint venture, association, trust, unincorporated
organization, or other entity.
"Purchase Price" has the meaning specified in Section 3.
"Purchase Price Bank Account" means one or more bank accounts
in the United States of America to be designated by Issuer in a written notice
to Investor not fewer than three Business Days prior to the Closing.
"Real Property" means the Leased Real Property and the Owned
Real Property.
"Representative" means, with respect to any specified Person,
any Affiliate, manager, director, officer, employee, agent, accountant, or
counsel of, or other Person empowered to act for, such Person.
"Securities" means shares of Common Stock; any rights,
options, or warrants to purchase shares of Common Stock; and any other
securities of any kind, nature, or description whatsoever convertible into or
exercisable or exchangeable for shares of Common Stock, including, without
limitation, shares of any series of preferred stock of Issuer.
"Securities Act" means, as of any date of determination, the
Securities Act of 1933, as amended, or any similar federal statute, and the
rules and regulations of the Commission thereunder, all as in effect as of such
date.
"Share Certificate" means the share certificate of Issuer
evidencing the Shares, substantially in the form attached hereto as Exhibit F.
"Shares" has the meaning specified in the recitals hereto.
"Stockholder Approval Requirement" has the meaning specified
in Section 5(a).
"Stockholders' Agreement" means the stockholders' agreement to
be entered into among Issuer, Investor, and certain other stockholders of Issuer
at or prior to the Closing, substantially in the form attached hereto as Exhibit
E.
"Subsequent Warrants" has the meaning specified in the
recitals hereto.
"Subsequent Warrant Shares" has the meaning specified in the
recitals hereto.
30
"Subsidiaries" means all corporations, partnerships, limited
liability companies, joint ventures, associations, and other entities controlled
by (as such term is used in the definition of "Affiliates" above) Issuer
directly or indirectly through one or more intermediaries.
"Taxes" means all taxes, fees, levies, duties, tariffs,
imposts, and other charges of any kind, nature, or description whatsoever
(together with all interest, penalties, loss, damage, liability, expense,
additions to tax and additional amounts or costs incurred or imposed with
respect thereto) imposed by any government or taxing authority, including,
without limitation: (i) taxes or other charges on or with respect to income,
franchises, concessions, windfall or other profits, gross receipts, property,
sales, use, capital, gains, capital stock or shares, payroll, employment, social
security, workers' compensation, unemployment compensation, or net worth; (ii)
taxes or other charges in the nature of excise, withholding, ad valorem, stamp,
transfer, value added, or gains taxes; (iii) license, registration and
documentation fees; and (iv) customs duties, tariffs, and similar charges.
"Tax Returns" has the meaning specified in Section 5(t).
"Third-Party Claim" has the meaning specified in Section
16(c).
"Transaction Agreements" means this Agreement, the Development
Agreement, the Investor Rights Agreement, the Stockholders' Agreement, the Share
Certificate and the Initial Warrants Certificate.
"Transfer" means, with respect to any specified Securities, to
make, offer or agree to make, or suffer to be made any sale, transfer,
assignment, allocation, distribution, gift, or other disposition of, or to
create, incur, assume, permit, or suffer to exist any Encumbrance upon or with
respect to, by operation of Law or otherwise (including, without limitation, by
merger, consolidation, dividend, or distribution), all or any part of such
Securities; provided that any pledge by Investor of Securities in connection
with a financing facility entered into by Investor shall not constitute a
"Transfer".
"U.S. GAAP" means United States generally accepted accounting
principles and practices as in effect from time to time and applied consistently
throughout the periods involved.
31
ADDRESSES FOR NOTICES
If to Issuer: Grill Concepts, Inc.
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Chairman
Telephone: (310)
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
with copies to: Herzog, Fisher, ▇▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (310)
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
and
Vanderkam & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
If to Investor: Before August 1, 2001:
Starwood Hotels and Resorts Worldwide, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Senior Vice President--Business Development
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
On or after August 1, 2001:
Starwood Hotels and Resorts Worldwide, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Senior Vice President--Business Development
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
32
with copies to: Before August 1, 2001:
Starwood Hotels and Resorts Worldwide, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
On or after August 1, 2001:
Starwood Hotels and Resorts Worldwide, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
and
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: Notices (194/046)
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopier: (▇▇▇) ▇▇▇-▇▇▇▇
33