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STOCK AGREEMENT
by and among
SAVANAH LIMITED PARTNERSHIP
a District of Columbia Limited Partnership
as Stock Purchaser
and
STARWOOD HOTELS & RESORTS TRUST,
a Maryland real estate investment trust
and
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.,
a Maryland corporation,
Dated as of January 15, 1998
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STOCK AGREEMENT
THIS STOCK AGREEMENT (this "Agreement") is entered into as of
January 15, 1998 (the "Closing Date") by and between SAVANAH LIMITED
PARTNERSHIP, a District of Columbia limted partnership, ("Stock Purchaser"),
STARWOOD HOTELS & RESORTS TRUST, a Maryland real estate investment trust (the
"Trust"), and STARWOOD HOTELS & RESORTS WORLDWIDE, INC., a Maryland corporation
(the "Corporation", and, with the Trust, "Starwood Lodging").
R E C I T A L S
A. Stock Purchaser has agreed to acquire from Starwood Lodging, and
Starwood Lodging has agreed to issue and deliver to Stock Purchaser, Paired
Shares in partial consideration for certain assets owned by Stock Purchaser.
B. The parties desire to enter into this Agreement in order to set
forth certain terms and conditions under which the Paired Shares are to be
issued to and held by Stock Purchaser.
A G R E E M E N T
NOW, THEREFORE, in consideration of the foregoing and the mutual promises
and agreements contained in this Agreement and for other good and valuable
consideration, the receipt and adequacy of which are hereby mutually
acknowledged, Starwood Lodging and Stock Purchaser agree as follows:
SECTION 1
DEFINITIONS
1.1 Defined Terms.
"Accredited Investor" shall have the meaning ascribed to that term
in Rule 501 promulgated by the SEC under the Securities Act.
"Affiliate" shall mean, with respect to any Person, any other Person
that controls, is controlled by or is under common control with such first
Person.
"Applicable Percentage" shall mean: (a) if Starwood Lodging delivers
Registered Shares to Stock Purchaser pursuant to Section 2.1 hereof, 100% and
(b) if Starwood Lodging delivers Unregistered Shares pursuant to Section 2.1
hereof, 91.95%.
"Business Day" shall mean any day on which the New York Stock
Exchange is open for business.
"Closing Date" shall mean the date hereof.
"Equity Value" shall mean One Hundred Fifty-Two Million Six Hundred
Thirty-Seven Thousand Dollars ($152,637,000), divided by the Applicable
Percentage, rounded to the nearest whole number.
"ITT Closing" shall have the meaning set forth in the Registration
Rights Agreement.
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"Joinder Agreement" means an agreement to be bound by this Agreement
in the form of Attachment A hereto.
"LIBOR" means the average of the interbank offered rates for
three-month dollar deposits in the London market based on quotations at five (5)
major banks, as published from time to time in The Wall Street Journal. If The
Wall Street Journal ceases to publish such a compilation of interbank offered
rates, or if The Wall Street Journal ceases to be published, then Starwood
Lodging shall propose a substitute method of determining the interest rate
generally known as the three-month LIBOR rate, which method, absent manifest
error, shall be binding on all holders of the Subject Shares and Starwood.
"Lock Price" shall mean $53.75 per Paired Share if the Closing Date
occurs on or before the 60th day after seven Business Days after January 15,
1998 (or thereafter because of a default by the Trust or the Corporation), and
the Market Price as of the Closing Date if the Closing Date occurs thereafter
for any reason other than a default by the Trust or the Corporation provided,
however, that in the event that, at any time during the period between December
30, 1997 and the Settlement Date, the Corporation or the Trust effects any
reclassification, stock split or stock dividend with respect to their stock, any
change or conversion of stock into other securities, or any other dividend or
distribution with respect to the Paired Shares, other than (i) dividends
contemplated by the Starwood Lodging Disclosure in effect as of December 30,
1997, or (ii) dividends in the aggregate not to exceed the greater of (a) the
current rate (as of December 30, 1997) of their dividends (together with any
increases in such rate in the ordinary course) and (b) the Trust's "real estate
investment taxable income" (as such term is defined for purposes of the Internal
Revenue Code) without regard to any net capital gains or the deduction for
dividends paid, appropriate and proportionate adjustments shall be made to the
Lock Price.
"Market Price" shall mean, as of any date, the average closing
prices of the Paired Shares on the New York Stock Exchange during the ten
consecutive Business Days immediately preceding such date.
"Open Market Sale" means one or more sales of Stock Agreements
Shares (including "short sales" initiated with the intention of delivering Stock
Agreements Shares) made or proposed to be made by placing one or more sale
orders or offers to sell with one or more securities brokers or dealers with a
view toward the consummation of one or more sale transactions that are required
to be, or that actually are, reported to the New York Stock Exchange or the
National Association of Securities Dealers.
"Orderly Market Disposition" means the sale of Stock Agreements
Shares by placing one or more sell orders with one or more securities brokers or
dealers with a view toward the disposition in the market of such Stock
Agreements Shares.
"Other Stock Agreements" shall mean, collectively, (i) that certain
Stock Agreement, dated as of January 15, 1998, among New Remington Partners, as
stock purchaser, and Starwood Lodging, (ii) that certain Stock Agreement, dated
as of January 15, 1998, among N.Y. Overnight Partners, L.P., as stock purchaser,
and Starwood Lodging, and (iii) that certain Stock Agreement, dated as of
January 15, 1998, among D.C. Overnight Partners, L.P., as stock purchaser, and
Starwood Lodging.
"Paired Shares" shall mean one share of beneficial interest, par
value $.01 per share, of the Trust, and one share of common stock, par value
$.01 per share, of the Corporation that are
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subject to the Pairing Agreement. For purposes of calculating the number of
Paired Shares to be delivered hereunder, each pair of the shares of the stock of
the Trust and the Corporation shall be considered one share.
"Pairing Agreement" shall mean the Pairing Agreement dated as of
June 25, 1980, as amended, between the Trust and the Corporation providing, in
relevant part, for the pairing of all outstanding shares of the Corporation and
the Trust.
"Payment Rights" shall have the meaning set forth in Section 5
hereof.
"Person" shall have the meaning set forth in the Registration Rights
Agreement.
"Proposed Disposition Shares" shall have the meaning set forth in
Section 3 hereof.
"Put Price" and "Put Right" shall have the meaning set forth in
Section 2.4 hereof.
"Registered Shares" means Subject Shares the issuance of which to
Stock Purchaser has been registered under the Securities Act.
"Registration Rights Agreement" means the Registration Rights
Agreement by and among Stock Purchaser, the Trust and the Corporation in the
form of Attachment B hereto.
"Registration Statement" shall have the meaning set forth in the
Registration Rights Agreement.
"Required Effectiveness Date" shall have the meaning set forth in
the Registration Rights Agreement.
"Response Date" shall have the meaning set forth in Section 3
hereof.
"Restricted Group" shall mean two (2) or more Restricted Holders
acting in concert or under common direction.
"Restricted Holder" shall mean Stock Purchaser and any other Person
who shall have acquired any Stock Agreements Shares in a Transfer not
constituting an Open Market Sale. A Restricted Holder shall not include any
Person who shall have acquired any Stock Agreements Shares in a Transfer not
constituting an Open Market Sale if such Transfer occurs after the first Open
Market Sale of such Stock Agreements Shares.
"Sale Notice" shall have the meaning set forth in Section 3 hereof.
"SEC" shall mean the United States Securities and Exchange
Commission.
"SEC Documents" means all documents required to have been filed by
the Trust or the Corporation with the SEC since January 1, 1996 and through the
date hereof.
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Settlement Date" shall mean, if Starwood Lodging shall deliver
Unregistered Shares pursuant to Section 2.1 hereof, the date on which Starwood
Lodging or its counsel shall notify Stock
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Purchaser that (i) the Registration Statement has been declared effective by the
SEC, (ii) that the Subject Shares have been registered, on the terms and subject
to the provisions of the Registration Rights Agreement, for Transfer by the
selling shareholders named therein in Open Market Sales and in such other manner
as is provided in the Registration Statement, and (iii) that Starwood Lodging
has completed all deliveries and other actions required to enable trading of the
Subject Shares on the New York Stock Exchange; provided, however, that if such
notice is given later than 1:00 PM Eastern Time, the Settlement Date shall be
deemed for all purposes to occur on the Business Day following the date of such
notice.
"Starwood Lodging Disclosure" shall mean, collectively, the Form S-3
filed by the Corporation and the Trust with the SEC on November 12, 1997, and
the Form S-4 filed by the Corporation and the Trust with the SEC on November 20,
1997, as the same has been or may hereafter be amended by any filing with the
SEC made by the Trust or the Corporation.
"Stock Agreements Shares" shall mean the aggregate of the Subject
Shares and the other Paired Shares delivered pursuant to the Other Stock
Agreements.
.
"Stock Purchaser Affiliates" shall have the meaning set forth in
Section 6.1 hereof.
"Subject Shares" means the 3,088,372 Paired Shares delivered by
Starwood Lodging pursuant to Section 2.1 hereof.
"Transfer" shall have the meaning set forth in the Registration
Rights Agreement.
"Transfer Agent" shall mean the transfer agent for the Paired
Shares.
"Unregistered Shares" means Subject Shares the issuance of which to
Stock Purchaser has not been registered under the Securities Act.
1.2 Other Definitional Provisions. The terms "hereof," "hereto,"
"hereunder" and similar terms when used in this Agreement shall refer to this
Agreement generally, rather than to the section in which such term is used,
unless otherwise specifically provided. Unless the context otherwise requires,
any defined term used in the plural shall refer to all members of the relevant
class, and any defined term used in the singular shall refer to any one or more
of the members of the relevant class.
SECTION 2
CALCULATION OF SUBJECT SHARES
2.1 Calculation of Subject Shares. Starwood Lodging shall deliver to
Stock Purchaser on the Closing Date Paired Shares in an amount equal to the
Equity Value divided by the Lock Price. Starwood Lodging shall have the option
to deliver Registered Shares or Unregistered Shares on the Closing Date.
2.2 Delivery Requirements for Paired Shares. The Paired Shares to
be delivered hereunder shall be properly endorsed and certificated Paired Shares
in the amount required to be delivered in accordance with the provisions of this
Agreement. If Registered Shares are delivered, such shares shall be unlegended
and fully and freely transferable without any consent of, registration
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with or notice to any Person (except as provided for in Sections 3 and 4 hereof
and in the Pairing Agreement). If Unregistered Shares are issued, each
certificate evidencing Subject Shares shall be stamped or otherwise imprinted
with a legend in substantially the following form (and no other restrictive
legends):
THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"), AND MAY
NOT BE SOLD OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
EXEMPTION FROM REGISTRATION UNDER SUCH ACT. THE SALE, PLEDGE OR
OTHER TRANSFER OF THIS CERTIFICATE OR THE SHARES EVIDENCED HEREBY IS
SUBJECT TO THE TERMS OF A REGISTRATION RIGHTS AGREEMENT DATED AS OF
JANUARY 15, 1998 BETWEEN THE ISSUER AND THE HOLDER HEREOF.
There shall be no legend on the Paired Shares reflecting the restrictions in
Sections 3 or 4 hereof.
2.3 Other Deliveries. Concurrently with the delivery of the Paired
Shares, Starwood Lodging shall deliver to Stock Purchaser any statements, such
as a transfer or conveyance tax forms or returns required by applicable federal
or New York law to be executed by Starwood Lodging, as may reasonably be
requested by Stock Purchaser in order to effect the delivery of the Subject
Shares to Stock Purchaser.
2.4 Registration Rights and Requirements.
(a) If Starwood Lodging delivers Unregistered Shares pursuant to
Section 2.1 hereof, Stock Purchaser and Starwood Lodging shall on the Closing
Date execute and deliver to each other the Registration Rights Agreement and the
parties thereto shall perform their respective obligations thereunder. If
Starwood Lodging delivers Registered Shares pursuant to Section 2.1 hereof, the
Registration Rights Agreement shall not be executed or delivered and none of the
parties shall have any obligations thereunder.
(b) If Starwood Lodging delivers Unregistered Shares pursuant to
Section 2.1 hereof, and if the Settlement Date shall not have occurred on or
before the seventh Business Day after the Required Effectiveness Date, Starwood
Lodging shall pay to each Restricted Holder, on the Settlement Date, an amount
equal to the "Interest Factor." For each Restricted Holder, the "Interest
Factor" shall be an amount equal to the product of (i) LIBOR plus 2% per annum
for each day after the seventh Business Day after the Required Effectiveness
Date to and including the earlier of the Settlement Date or the date that is 60
days after the Required Effectiveness Date, multiplied by (ii) the Market Price
multiplied by the number of Subject Shares held by such Restricted Holder on the
date of such payment.
(c) In the event that the Settlement Date shall not have occurred by
the date that is 60 days after the Required Effectiveness Date, each Person who
is a Restricted Holder as of such date shall have the non-transferrable right
(its "Put Right"), exercisable at any one time for each such Restricted Holder
after such 60th day and through the earlier to occur of (i) the Settlement Date,
and (ii) the day immediately prior to the first anniversary of the Closing, to
"put" some or all of the Subject Shares held by such Restricted Holder to
Starwood Lodging for an amount per share equal to the Put
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Price; provided, however, that the Put Right shall not be exercisable by any
Restricted Holder for a number of Subject Shares that is less than the lesser of
(i) 100,000, or (ii) the number of Subject Shares then held by such Restricted
Holder. Such right shall be exercised by such Restricted Holder giving Starwood
Lodging notice of its election to exercise its Put Right and the number of
Subject Shares to be purchased by Starwood, whereupon Starwood Lodging shall
purchase such shares at 9:00 a.m. (Eastern Time) on the second Business Day
following its receipt of such notice, with payment to be delivered (against
delivery to Starwood Lodging of such shares free of all rights of other Persons)
on the third Business Day thereafter in cash or immediately available funds to
such account as such Restricted Holder may designate in such notice. The Put
Price shall be the Market Price determined as of the date such notice is given.
Starwood Lodging shall have the right to satisfy its obligations under the Put
Rights by designating another Person as the purchaser of such shares, and such
obligations shall be deemed satisfied upon such other Person's purchase of such
shares for the Put Price and at the time and in the manner set forth herein.
Such designation shall not affect Starwood's obligation to pay the Interest
Factor as provided herein.
(d) The Interest Factor and the right of each Restricted Holder to
receive the Put Price in the event it elects to exercise its Put Right shall be
each Restricted Holder's sole and exclusive monetary remedies arising from
Starwood's failure to cause the Settlement Date to occur on or before the
seventh Business Day after the Required Effectiveness Date and shall be deemed
liquidated damages in respect of such failure; and each Restricted Holder shall
be deemed to have waived its other monetary remedies. However, from and after
the seventh Business Day after the Required Effectiveness Date, each Holder
shall at all times have such equitable remedies as may be available under
applicable law.
SECTION 3
NOTICE PROCEDURES REGARDING OPEN MARKET SALE
OF STOCK AGREEMENTS SHARES
3.1 If, at any time any Restricted Holder or Restricted Group elects
to Transfer, in an Open Market Sale, more than 100,000 Stock Agreements Shares
on any single Business Day (300,000 Stock Agreements Shares from and after the
first Business Day after the ITT Closing), prior to executing such Transfer the
designated representative of such Restricted Holder or Restricted Group shall
provide Starwood's representative, the Chief Financial Officer of the Trust (or
any successor representative identified by a notice given hereunder), with
telephonic notice at (▇▇▇) ▇▇▇-▇▇▇▇ along with a confirmation of such notice by
telefacsimile to Starwood Lodging and Starwood's additional addressees as
provided in Section 7.1 hereof. Such notice (the "Sale Notice") shall indicate
the number of Stock Agreements Shares which such Restricted Holder or Restricted
Group has determined to Transfer in an Open Market Sale (the "Proposed
Disposition Shares") on such day or days and shall comply with Section 3.5
hereof (if applicable). Such notice shall be deemed given on the Business Day
the telephonic notice described above is given so long as such notice is given
by 5:00 P.M., Eastern time, on such day; if given after that time, it shall be
deemed given on the next Business Day. In the event that, at any time while this
Section 3.1 is in effect, the Corporation or the Trust effects any
reclassification, stock split or stock dividend with respect to their stock, any
change or conversion of stock into other securities, or any other dividend or
distribution with respect to the Paired Shares, other than (i) dividends
contemplated by the Starwood Lodging Disclosure as in effect on December 30,
1997, or (ii) dividends in the aggregate not to exceed the greater of (a) the
current rate (as of December 30, 1997) of their dividends (together with any
increases in such rate in the ordinary course) and (b) the Trust's "real estate
investment taxable income" (as such term is defined for purposes of the Internal
Revenue Code) without regard to any net capital gains or the deduction for
dividends paid,
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appropriate and proportionate adjustments shall be made to the numbers of Stock
Agreements Shares set forth in the first sentence of this Section 3.1.
3.2 No later than noon, Eastern time, on the second Business Day
after the Sale Notice is given as described above, Starwood Lodging may provide
the representative(s) of such Restricted Holder or Restricted Group with
telephonic notice, along with a confirmation of such notice to such
representatives by telefacsimile, that Starwood Lodging is irrevocably offering
to purchase or place all of the Proposed Disposition Shares at a price per share
equal to the average of the closing prices on the New York Stock Exchange on the
first and second Business Days following the giving of the Sale Notice. Such
notice shall be given as provided in Section 3.5 hereof. It shall be a condition
to such notice and the consummation of such transaction that such transaction
not constitute a violation of Regulation M promulgated by the SEC. If Starwood
Lodging fails to make such an offer within such period, it shall have no further
rights under this Section 3 with respect to any Orderly Market Disposition by
such Restricted Holder or Restricted Group of Stock Agreements Shares up to the
amount of the Proposed Disposition Shares that is commenced not later than the
seventh Business Day after the Sale Notice is given.
3.3 If Starwood Lodging duly makes such an offer, such Restricted
Holder or Restricted Group shall elect by telephonic notice to Starwood's
representative delivered and confirmed as described above, given by 8:30 a.m.
(Eastern Time) on the Business Day following receipt of Starwood's offer (such
day is referred to herein as the "Response Date"), in their sole and absolute
discretion, to either (i) proceed with such proposed disposition, in which
instance Starwood Lodging shall purchase or place the Proposed Disposition
Shares at 9:00 a.m. (Eastern Time), on the Response Date, with payment to be
delivered (against delivery to Starwood Lodging of the Proposed Disposition
Shares free of all rights of other Persons) on the third Business Day after the
Response Date in cash or immediately available funds to such account as such
Restricted Holder may designate by notice to Starwood, or (ii) not to proceed
with such proposed disposition, in which instance the Sale Notice shall be
withdrawn and such Restricted Holder shall continue to hold the Proposed
Disposition Shares subject to the terms of this Section 3 (to the extent
applicable). If such Restricted Holder shall fail to so elect by 8:30 a.m.
(Eastern Time) on the Response Date, it shall irrevocably be deemed to have
elected not to proceed with such proposed disposition.
3.4 On the first anniversary of the Settlement Date, the provisions
of this Section 3 shall automatically lapse and be of no further force or effect
with respect to each Restricted Holder that holds less than 500,000 Stock
Agreements Shares (except (i) to the extent that such Restricted Holder acts on
or after such date as a member of a Restricted Group that holds in the aggregate
500,000 or more Stock Agreements Shares, and (ii) to the extent such Restricted
Holder, either alone or as a member of a Restricted Group, has given or was
required to have given Starwood Lodging a Sale Notice prior to such date and as
to which the procedures in this Section 3 have not been fully performed).
3.5 Any notice given by Starwood Lodging pursuant to Section 3.2
hereof to Stock Purchaser shall be given telephonically to Mansor Dalaan at
(▇▇▇) ▇▇▇-▇▇▇▇ and by telefacsimile to (▇▇▇) ▇▇▇-▇▇▇▇, or to such other
telephone and telefacsimile numbers as may be set forth for such purpose in the
Sale Notice. Any notice given by Starwood Lodging pursuant to Section 3.2 hereof
to any other Restricted Holder or Restricted Group shall be given to the
telephone and telefacsimile numbers as may be set forth for such purpose in the
Sale Notice, and no Sale Notice from a Restricted Holder other than Stock
Purchaser or from any Restricted Group shall be deemed properly given in
accordance with Section 3.1 unless such numbers are set forth in such Sale
Notice.
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3.6 Time is of the essence in the performance by the parties of
their obligations under this Section 3.
SECTION 4
TRANSFERS NOT CONSTITUTING AN OPEN MARKET SALE; SHORT SALES
4.1 Each Restricted Holder covenants and agrees that, as a condition
to any Transfer by a such Restricted Holder of Subject Shares in a transaction
that does not constitute an Open Market Sale, such Restricted Holder will obtain
and deliver to Starwood Lodging a Joinder Agreement duly executed by the
transferee or the intended transferee; and any purported Transfer of Subject
Shares made in breach of this provision shall be null and void ab initio.
4.2 Each Restricted Holder covenants and agrees that, prior to the
effectiveness of the Registration Statement, it will not "sell short" (as such
term is commonly understood in the brokerage industry) any Paired Shares,
whether "against the box" or otherwise.
SECTION 5
PAYMENT RIGHTS
On the Settlement Date, Starwood Lodging shall pay to Stock
Purchaser in cash or other immediately available funds an amount equal to the
amount, if any, by which the Lock Price exceeds the Market Price as of the
Settlement Date, multiplied by the number of Paired Shares delivered by Starwood
Lodging to Stock Purchaser hereunder. Stock Purchaser's right to receive the
payments from Starwood Lodging described in this section are referred to herein
as the "Payment Rights." Pursuant to a written instrument a copy of which is
delivered to Starwood Lodging promptly following its execution by Stock
Purchaser, Stock Purchaser may distribute to its partners or their shareholders
or assign to any other Person all or any portion of the Payment Rights either
together with or separately from the Paired Shares delivered hereunder.
SECTION 6
REPRESENTATIONS AND WARRANTIES
6.1 Stock Purchaser represents and warrants to Starwood Lodging as
follows:
(a) Stock Purchaser has the power and authority to enter into this
Agreement and the Registration Rights Agreement and to perform its obligations
hereunder and thereunder. The execution and delivery hereof and thereof and the
performance by Stock Purchaser of its obligations hereunder and thereunder will
not violate or constitute an event of default under any material term or
material provision of any agreement, document, instrument, judgment, order or
decree to which Stock Purchaser is a party or by which it is bound, or violate
any law, rule or regulation the violation of which would have a material adverse
effect upon the principal benefits intended to be provided under this Agreement
or the Registration Rights Agreement.
(b) The individuals executing this Agreement and the Registration
Rights Agreement on behalf of Stock Purchaser have the legal power, right and
actual authority to bind Stock Purchaser to the terms and conditions hereof and
thereof. Each of this Agreement and the Registration Rights Agreement is a valid
and binding obligation of Stock Purchaser, enforceable in accordance with
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its terms, except as the same may be affected by bankruptcy, insolvency,
moratorium or similar laws, or by legal or equitable principles relating to or
limiting the rights of contracting parties generally.
(c) Stock Purchaser is acquiring the Subject Shares to be issued to
it for investment, solely for the account of itself, on behalf of its partners
and Persons who are stockholders of such partners, or on behalf of certain
Persons each of whom is both an Affiliate of a partner of Stock Purchaser and a
creditor of Stock Purchaser (collectively, such partners and other Persons the
"Stock Purchaser Affiliates"). Neither Stock Purchaser nor any of the Affiliates
of Stock Purchaser is acquiring Subject Shares with a view to or for sale in
connection with any distribution of such Subject Shares in violation of
applicable securities laws.
(d) Stock Purchaser and each of the Stock Purchaser Affiliates is an
Accredited Investor.
(e) Stock Purchaser has obtained and reviewed the Starwood Lodging
Disclosure and the SEC Documents that have been filed with the SEC through the
date hereof.
6.2 By its execution of its Joinder Agreement, each Restricted
Holder other than Stock Purchaser shall be deemed to have represented and
warranted to Starwood, as of the date of its delivery of such Joinder Agreement,
as follows:
(a) Such Restricted Holder has the power and authority to enter into
this Agreement, the Registration Rights Agreement and its Joinder Agreement and
to perform its obligations hereunder and thereunder. The execution and delivery
hereof and thereof and the performance by such Restricted Holder of its
obligations hereunder and thereunder will not violate or constitute an event of
default under any material term or material provision of any agreement,
document, instrument, judgment, order or decree to which such Restricted Holder
is a party or by which it is bound, or violate any law, rule or regulation the
violation of which would have a material adverse effect upon the principal
benefits intended to be provided under this Agreement or the Registration Rights
Agreement.
(b) The individuals executing this Agreement, the Registration
Rights Agreement and its Joinder Agreement on behalf of such Restricted Holder
have the legal power, right and actual authority to bind such Restricted Holder
to the terms and conditions hereof and thereof. Each of this Agreement, the
Registration Rights Agreement and its Joinder Agreement is a valid and binding
obligation of such Restricted Holder, enforceable in accordance with its terms,
except as the same may be affected by bankruptcy, insolvency, moratorium or
similar laws, or by legal or equitable principles relating to or limiting the
rights of contracting parties generally.
(c) Such Restricted Holder is acquiring the Subject Shares
Transferred or to be Transferred to it for investment, solely for the account of
itself and not with a view to or for sale in connection with any distribution of
such Subject Shares in violation of applicable securities laws; provided,
however, that if such Restricted Holder is Stock Purchaser Affiliate, such
Restricted Holder may acquire the Subject Shares on behalf of Persons who are
stockholders of such Restricted Holder if each of such Persons is an Accredited
Investor.
(d) Such Restricted Holder is an Accredited Investor.
(e) Such Restricted Holder has had the opportunity, prior to making
the determination to acquire any Subject Shares, to obtain and review the
Starwood Lodging Disclosure
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and the SEC Documents that have been filed with the SEC through the date of the
execution of such Restricted Holder's Joinder Agreement.
6.3 The Trust hereby represents and warrants to Stock Purchaser as
follows:
(a) The Trust has the power and authority to enter into this
Agreement and the Registration Rights Agreement and to consummate the
transactions herein contemplated; neither the execution and delivery of this
Agreement or the Registration Rights Agreement by the Trust, nor the performance
by the Trust of the Trust's obligations hereunder or thereunder will violate or
constitute an event of default under any material terms or material provisions
of any agreement, document, instrument, judgment, order or decree to which the
Trust is a party or by which the Trust is bound, or violate any law, rule or
regulation the violation of which would have a material adverse effect upon the
principal benefits intended to be provided under this Agreement or the
Registration Rights Agreement.
(b) The individuals executing this Agreement and the Registration
Rights Agreement and the documents referenced herein on behalf of the Trust have
the legal power, right and actual authority to bind the Trust to the terms and
conditions hereof. This Agreement and the Registration Rights Agreement is a
valid and binding obligation of Trust, enforceable in accordance with its terms,
except as the same may be affected by bankruptcy, insolvency, moratorium or
similar laws, or by legal or equitable principles relating to or limiting the
rights of contracting parties generally.
(c) All Paired Shares to be delivered in accordance with Section 2.1
hereof will, when so issued, be duly authorized, validly issued, fully paid and
nonassessable and free of preemptive rights and will be paired with each other
in the same ratio as all other shares are paired with each other pursuant to the
Pairing Agreement.
(d) The Trust has filed all of the SEC Documents. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of applicable law, and, at the respective times they were filed,
none of the SEC Documents contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. The consolidated financial statements (including, in each
case, any notes thereto) of the Trust included in the SEC Documents complied as
to form in all material respects with applicable accounting requirements and the
published rules and regulations of the SEC with respect thereto as of their
respective dates of filing, were prepared in accordance with generally accepted
accounting principles (except, in the case of the unaudited statements, as
permitted by Regulation S-X of the SEC) applied on a consistent basis during the
periods involved (except as may be indicated therein or in the notes thereto)
and fairly presented the consolidated financial position of the Trust and its
consolidated subsidiaries as of the respective dates thereof and the
consolidated results of their operations and their consolidated cash flows for
the periods then ended (subject, in the case of unaudited statements, to normal
year-end audit adjustments and to any other adjustments described therein).
Except as disclosed in the SEC Documents or as required by generally accepted
accounting principles, the Trust has not, since December 31, 1996, made any
change in the accounting practices or policies applied in the preparation of
their financial statements.
(e) Except as disclosed in the SEC Documents or the Starwood Lodging
Disclosure, since December 31, 1996 and through the date hereof, (i) there have
not been any events, changes or developments that, individually or in the
aggregate, have had or would reasonably be
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expected to have, a material adverse change in or effect on the financial
condition, properties, business, results of operations or prospects of the Trust
and its subsidiaries taken as a whole, or (ii) there has not been any split,
combination or reclassification of any of the capital stock or units of the
Trust or its operating partnership or any issuance or the authorization of any
issuance of any other securities in respect of, in lieu of, or in substitution
for shares of such capital stock.
(f) Except as set forth in the SEC Documents or the Starwood Lodging
Disclosure or in a separate writing provided to Stock Purchaser on or before the
date hereof, as of the date hereof: there are no outstanding orders, judgments,
injunctions, awards or decrees of any governmental entity against or involving
the Trust or any of its subsidiaries, or against or involving any of the
directors, officers or employees of the Trust or any of its subsidiaries, as
such, or any of its or their properties, assets or business that, individually
or in the aggregate, have had, or would reasonably be expected to have, a
material adverse change in or effect on the financial condition, properties,
business, results of operations or prospects of the Trust and its subsidiaries
taken as a whole; and there are no actions, suits or claims or legal,
administrative or arbitrative proceedings or investigations pending or, to the
knowledge of the Trust, threatened against or involving the Trust or any of its
subsidiaries or any of their directors, officers or employees, as such, or any
of its or their properties, assets or business that, individually or in the
aggregate, have had, or would reasonably be expected to have, a material adverse
change in or effect on the financial condition, properties, business, results of
operations or prospects of the Trust and its subsidiaries taken as a whole. As
of the date hereof, there are no actions, suits or other litigation, legal or
administrative proceedings or governmental investigations pending or, to the
knowledge of the Trust, threatened against or affecting the Trust or any of its
subsidiaries or any of their officers, directors or employees, as such, or any
of their properties, assets or business relating to the transactions
contemplated by this Agreement and the Registration Rights Agreement.
6.4 The Corporation hereby represents and warrants to Stock Purchaser as
follows:
(a) The Corporation has the power and authority to enter into this
Agreement and the Registration Rights Agreement and to consummate the
transactions herein contemplated; neither the execution and delivery of this
Agreement or the Registration Rights Agreement by the Corporation, nor the
performance by the Corporation of the Corporation's obligations hereunder or
thereunder will violate or constitute an event of default under any material
terms or material provisions of any agreement, document, instrument, judgment,
order or decree to which the Corporation is a party or by which the Corporation
is bound, or violate any law, rule or regulation the violation of which would
have a material adverse effect upon the principal benefits intended to be
provided under this Agreement or the Registration Rights Agreement.
(b) The individuals executing this Agreement and the Registration
Rights Agreement and the documents referenced herein on behalf of the
Corporation have the legal power, right and actual authority to bind the
Corporation to the terms and conditions hereof. This Agreement and the
Registration Rights Agreement is a valid and binding obligation of Corporation,
enforceable in accordance with its terms, except as the same may be affected by
bankruptcy, insolvency, moratorium or similar laws, or by legal or equitable
principles relating to or limiting the rights of contracting parties generally.
(c) All Paired Shares to be delivered in accordance with Section 2.1
hereof will, when so issued, be duly authorized, validly issued, fully paid and
nonassessable and free of preemptive rights and will be paired with each other
in the same ratio as all other shares are paired with each other pursuant to the
Pairing Agreement.
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(d) The Corporation has filed all of the SEC Documents. As of their
respective dates, the SEC Documents complied in all material respects with the
requirements of applicable law, and, at the respective times they were filed,
none of the SEC Documents contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading. The consolidated financial statements (including, in each
case, any notes thereto) of the Corporation included in the SEC Documents
complied as to form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC with respect
thereto as of their respective dates of filing, were prepared in accordance with
generally accepted accounting principles (except, in the case of the unaudited
statements, as permitted by Regulation S-X of the SEC) applied on a consistent
basis during the periods involved (except as may be indicated therein or in the
notes thereto) and fairly presented the consolidated financial position of the
Corporation and its consolidated subsidiaries as of the respective dates thereof
and the consolidated results of their operations and their consolidated cash
flows for the periods then ended (subject, in the case of unaudited statements,
to normal year-end audit adjustments and to any other adjustments described
therein). Except as disclosed in the SEC Documents or as required by generally
accepted accounting principles, the Corporation has not, since December 31,
1996, made any change in the accounting practices or policies applied in the
preparation of their financial statements.
(e) Except as disclosed in the SEC Documents or the Starwood Lodging
Disclosure, since December 31, 1996 and through the date hereof, (i) there have
not been any events, changes or developments that, individually or in the
aggregate, have had or would reasonably be expected to have, a material adverse
change in or effect on the financial condition, properties, business, results of
operations or prospects of the Corporation and its subsidiaries taken as a
whole, or (ii) there has not been any split, combination or reclassification of
any of the capital stock or units of the Corporation or its operating
partnership or any issuance or the authorization of any issuance of any other
securities in respect of, in lieu of, or in substitution for shares of such
capital stock.
(f) Except as set forth in the SEC Documents or the Starwood Lodging
Disclosure or in a separate writing provided to Stock Purchaser on or before the
date hereof, as of the date hereof: there are no outstanding orders, judgments,
injunctions, awards or decrees of any governmental entity against or involving
the Corporation or any of its subsidiaries, or against or involving any of the
directors, officers or employees of the Corporation or any of its subsidiaries,
as such, or any of its or their properties, assets or business that,
individually or in the aggregate, have had, or would reasonably be expected to
have, a material adverse change in or effect on the financial condition,
properties, business, results of operations or prospects of the Corporation and
its subsidiaries taken as a whole; and there are no actions, suits or claims or
legal, administrative or arbitrative proceedings or investigations pending or,
to the knowledge of the Corporation, threatened against or involving the
Corporation or any of its subsidiaries or any of their directors, officers or
employees, as such, or any of its or their properties, assets or business that,
individually or in the aggregate, have had, or would reasonably be expected to
have, a material adverse change in or effect on the financial condition,
properties, business, results of operations or prospects of the Corporation and
its subsidiaries taken as a whole. As of the date hereof, there are no actions,
suits or other litigation, legal or administrative proceedings or governmental
investigations pending or, to the knowledge of the Corporation, threatened
against or affecting the Corporation or any of its subsidiaries or any of their
officers, directors or employees, as such, or any of their properties, assets or
business relating to the transactions contemplated by this Agreement and the
Registration Rights Agreement (other than those arising in connection with the
Registration Statement or the performance by the Corporation of its obligations
under the Registration Rights Agreement).
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SECTION 7
NOTICES
7.1 Addresses. Except for the notices given pursuant to Section 3,
whenever any notice, demand or request is required or permitted hereunder, such
notice, demand or request shall be made in writing and shall be (a) sent via a
nationally recognized overnight courier service fully prepaid, (b) deposited in
the United States by mail, registered or certified, return receipt requested,
postage prepaid, or (c) sent via telefacsimile, provided that the original of
such notice, demand or request shall also be sent via one of the methods
described in (a) and (b) above, in each case to the addressees (and individuals)
set forth below:
As to Stock Purchaser:
c/o Al Anwa USA, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Mansor Dalaan
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to Stock Purchaser's additional addressees:
▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ ▇. Eng, Esq.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
As to Starwood Lodging:
Starwood Hotels & Resorts Trust
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇ or Chief Financial Officer
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Starwood Hotels & Resorts Worldwide, Inc.
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ or Vice President
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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With a copy to Starwood Lodging's additional addressees:
▇▇▇▇▇▇▇▇▇ Traurig ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Sidley & Austin
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
and ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telefacsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to any Restricted Holder other than Stock Purchaser: to the address and
telefacsimile number set forth in such Restricted Holder's Joinder Agreement (or
to any other address or telefacsimile number provided to Starwood Lodging in
writing pursuant to a notice given by such Restricted Holder pursuant to this
Section 7.1).
7.2 Receipt of Notices. Any notice, demand or request that shall be
delivered to Starwood Lodging and its Additional Addressee in the manner
aforesaid shall be deemed sufficiently given to and received by Starwood Lodging
for all purposes hereunder, and any notice, demand or request that shall be
delivered to Stock Purchaser and its Additional Addressee in the manner
aforesaid shall be deemed sufficiently given to and received by Stock Purchaser
for all purposes hereunder (i) the next business day following the day such
notice, demand or request is delivered by a nationally recognized overnight
courier service fully prepaid, to such party and its Additional Addressee, (ii)
if sent via registered or certified mail, at the time of receipt by such party
and its Additional Addressee, or (iii) if sent via telefacsimile, as of the date
and time stated upon confirmation reports generated by the sending party's
telefacsimile machine confirming the delivery of such notice, demand or request
to such party and its Additional Addressee.
7.3 Refusal of Delivery. The inability to deliver any notice, demand
or request because the individual to whom it is properly addressed in accordance
with this Section 7 refused delivery thereof or no longer can be located at that
address shall constitute delivery thereof to such individual.
7.4 Change of Address. Each party shall have the right from time to
time to designate by written notice to the other parties hereto such other
Person or Persons and such other place or places as said party may desire
written notices to be delivered or sent in accordance herewith.
SECTION 8
GENERAL PROVISIONS
8.1 Amendment. No provision of this Agreement or of any documents or
instrument entered into, given or made pursuant to this Agreement may be
amended, changed, waived, discharged or terminated except by an instrument in
writing, signed by the party against whom enforcement of the amendment, change,
waiver, discharge or termination is sought.
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8.2 Time of Essence. All times provided for in this Agreement for
the performance of any act will be strictly construed, time being of the
essence.
8.3 Entire Agreement. This Agreement and other documents delivered
pursuant to this Agreement set forth the entire agreement and understanding of
the parties in respect of the transactions contemplated by this Agreement, and
supersede all prior agreements, arrangements and understandings relating to the
subject matter hereof and thereof. No representation, promise, inducement or
statement of intention with respect to the subject matter hereof has been made
by Stock Purchaser or Starwood Lodging which is not embodied in this Agreement,
and neither Starwood Lodging nor Stock Purchaser shall be bound by or liable for
any alleged representations, promise, inducement or statement of intention not
therein so set forth.
8.4 No Waiver. No failure of any party to exercise any power given
such party hereunder or to insist upon strict compliance by the other party with
its obligations hereunder shall constitute a waiver of any party's right to
demand strict compliance with the terms of this Agreement.
8.5 Counterparts. This Agreement, any document or instrument entered
into, given or made pursuant to this Agreement or authorized hereby, and any
amendment or supplement thereto may be executed in two or more counterparts,
and, when so executed, will have the same force and effect as though all
signatures appeared on a single document. Any signature page of this Agreement
or of such an amendment, supplement, document or instrument may be detached from
any counterpart without impairing the legal effect of any signatures thereon,
and may be attached to another counterpart identical in form thereto but having
attached to it one or more additional signature pages.
8.6 Costs and Attorneys' Fees. If any legal action or any
arbitration or other proceeding is brought for the enforcement of this Agreement
or because of an alleged dispute, default, or misrepresentation in connection
with any of the provisions of this Agreement the successful or prevailing party
shall be entitled to recover reasonable attorneys' fees, charges and other costs
incurred in that action or proceeding, in addition to any other relief to which
it may be entitled.
8.7 Payments; Interests. Except as otherwise provided herein,
payment of all amounts required by the terms of this Agreement shall be made in
the United States and in immediately available funds of the United States of
America which, at the time of payment, is accepted for the payment of all public
and private obligations and debts. If any payment due under this Agreement is
not paid when due, it shall thereafter bear interest at a variable rate equal to
the rate announced from time to time by Citibank, N.A. as its prime or reference
rate, plus five percent (5%) per annum, but in no event more than the maximum
rate, if any, allowed by law to be charged by the party receiving the interest
on such type of indebtedness.
8.8 Parties in Interest. The rights and obligations of the parties
hereto shall be binding upon and shall inure to the benefit of the parties
hereto and their respective successors, heirs and the legal representatives of
their respective estates. However, none of Stock Purchaser's rights under this
Agreement shall be assignable except (i) in the case of the Payment Rights, as
provided in Section 5 hereof, and (ii) in the case of all other rights of Stock
Purchaser or another Restricted Holder, to a transferee of Subject Shares in a
transaction not constituting an Open Market Sale if such transferee delivers a
Joinder Agreement in compliance with Section 4 hereof. Nothing in this Agreement
is intended to confer any right or remedy under this Agreement on any Person
other than the parties to this Agreement and their respective successors and
assigns, or to relieve or discharge the obligation or liability of any Person to
any party to this Agreement or to give any Person any right of subrogation or
action over or against any party to this Agreement.
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8.9 Applicable Law. This Agreement shall be governed by and
construed and enforced in accordance with the laws of the State of New York
without giving effect to the conflict-of-law rules and principles of that state.
8.10 Incorporation of Recitals. The recitals of this Agreement are
incorporated into and made a part of this Agreement.
8.11 Construction of Agreement. The language in all parts of this
Agreement shall be in all cases construed simply according to its fair meaning
and not strictly for or against any of the parties hereto. Headings at the
beginning of sections of this Agreement are solely for the convenience of the
parties and are not a part of this Agreement. When required by the context,
whenever the singular number is used in this Agreement, the same shall include
the plural, and the plural shall include the singular, the masculine gender
shall include the feminine and neuter genders, and vice versa. As used in this
Agreement, the term "Stock Purchaser" shall include the respective permitted
successors and assigns of Stock Purchaser, and the term "Starwood Lodging" shall
include the permitted successors and assigns of Starwood Lodging, if any.
8.12 Severability. If any term or provision of this Agreement is
determined to be illegal, unconscionable or unenforceable, all of the other
terms, provisions and sections hereof will nevertheless remain effective and be
in force to the fullest extent permitted by law.
8.13 Further Assurances. Starwood Lodging and Stock Purchaser agree
to execute upon the request of the other party such instruments and take such
actions as may be reasonably necessary to carry out the provisions of this
Agreement provided that no material additional cost or liability shall incurred
thereby by the party of whom such request is made.
8.14 Starwood Hotels & Resorts Trust. The parties hereto understand
and agree that the name "Starwood Hotels & Resorts Trust" is a designation of
the Trust and its trustees (as trustees but not personally) under the Trust's
Declaration of Trust, and all persons dealing with the Trust shall look solely
to the Trust's assets for the enforcement of any claims against the Trust, and
that the Trustees, officers, agents and security holders of the Trust assume no
personal liability for obligations entered into on behalf of the Trust, and
their respective individual assets shall not be subject to the claims of any
person relating to such obligations.
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IN WITNESS WHEREOF, Starwood Lodging and Stock Purchaser have caused
this Agreement to be executed as of the day and year first above written.
"Stock Purchaser"
SAVANAH LIMITED PARTNERSHIP,
a District of Columbia limited partnership
By: ASPEN ENTERPRISES INTERNATIONAL, INC.,
a Colorado corporation, its General Partner
By:
------------------------------
Mansor Dalaan
President
"Starwood Lodging"
STARWOOD HOTELS & RESORTS TRUST,
a Maryland real estate investment trust
By:
----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Senior Vice President
STARWOOD HOTELS & RESORTS WORLDWIDE, INC.,
a Maryland corporation
By:
----------------------------
▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Secretary
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ATTACHMENT A
to Stock Agreement
AGREEMENT TO BE BOUND
BY THE STOCK AGREEMENT
(JOINDER AGREEMENT)
The undersigned, being the transferee or the intended transferee of
______________ Paired Shares (the "Subject Shares") of Starwood Hotels & Resorts
Trust, a Maryland real estate investment trust, and Starwood Hotels & Resorts
Worldwide, Inc., a Maryland corporation (together, the "Company"), as a
condition to the transfer to and acquisition by the undersigned of such Subject
Shares, acknowledges that certain sales or other transfers of such Subject
Shares are governed by the Stock Agreement (the "Stock Agreement"), dated as of
January 15, 1998, initially among the Company and Savanah Limited Partnership, a
District of Columbia limited partnership , and the undersigned hereby (1)
acknowledges receipt of a copy of the Stock Agreement, and (2) agrees to be
bound as a "Restricted Holder" by the terms of the Stock Agreement, as the same
has been or may be amended from time to time (including without limitation the
representations and warranties of the undersigned set forth therein that will be
deemed made by virtue hereof).
The undersigned is hereby advised that the Subject Shares have not
been registered under the Securities Act of 1933 and in such event cannot be
resold unless they are registered under said act or unless an exemption from
registration under said act is available.
The following is the undersigned's representative and such
representative's address, telephone number and fax number for all purposes under
the Stock Agreement:
_________________________________
_________________________________
_________________________________
Agreed to this ____ day of __________, ____.
________________________________
By:
__________________________
Its:
__________________________