Exhibit (d)(1)
AGREEMENT AND PLAN OF MERGER
by and among
CBM JOINT VENTURE LLC,
CBM II ACQUISITION, L.P.
and
COURTYARD BY MARRIOTT II LIMITED PARTNERSHIP
DATE: _____________ ___, 2000
TABLE OF CONTENTS
Page
----
1. PLAN OF MERGER........................................................ 2
1.1. The Merger...................................................... 2
1.2. Certificate of Merger; Effective Time........................... 2
1.3. Effects of Merger............................................... 2
1.4. Closing......................................................... 2
1.5. Conversion of Partnership Interests............................. 3
2. COVENANTS............................................................. 4
2.1. Conduct of Business by the Partnership.......................... 4
2.2. Reasonable Efforts; Cooperation; Notification................... 4
3. CONDITIONS TO CLOSING................................................. 5
3.1. Conditions to Each Party's Obligations.......................... 5
4. TERMINATION, EXPENSES, AMENDMENT AND WAIVER........................... 6
4.1. Termination..................................................... 6
4.2. Expenses........................................................ 6
4.3. Amendment....................................................... 6
4.4. Extension; Waiver............................................... 7
5. MISCELLANEOUS......................................................... 7
5.1. Notices......................................................... 7
5.2. Assignment and Binding Effect................................... 8
5.3. Governing Law................................................... 8
5.4. Severability.................................................... 8
5.5. Further Assurances.............................................. 9
5.6. Counterparts.................................................... 9
Exhibit A - Certificate of Merger of CBM II Acquisition, L.P
into Courtyard by Marriott II Limited Partnership........................ A-1
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement") is entered into
as of ___________ __, 2000 by and among CBM Joint Venture LLC, a Delaware
limited liability company (the "Joint Venture"), CBM II Acquisition, L.P., a
Delaware limited partnership and an indirectly wholly owned subsidiary of the
Joint Venture ("Merger Sub"), and Courtyard by Marriott II Limited Partnership,
a Delaware limited partnership (the "Partnership").
WHEREAS, Rockledge Hotel Properties, Inc., a Delaware corporation
("Rockledge"), Marriott International, Inc., a Delaware corporation ("Marriott")
and certain other entities and persons are parties to a settlement agreement
dated March 9, 2000 (the "Settlement Agreement") relating to the settlement (the
"Settlement") of that certain lawsuit styled Cause No. 96-CI-08327 (the "▇▇▇▇▇▇
Litigation");
WHEREAS, pursuant to the Settlement Agreement, Rockledge and Marriott,
through wholly owned subsidiaries, have formed the Joint Venture to carry out
the terms of the Settlement Agreement;
WHEREAS, pursuant to the Settlement Agreement, CBM II Holdings LLC, a
Delaware limited liability company (the "Purchaser") and an indirect wholly
owned subsidiary of the Joint Venture, has offered to purchase (the "Purchase
Offer") all of the issued and outstanding units of limited partnership interest
(the "Units") in the Partnership (other than Units owned by the general partner
of the Partnership, CBM Two LLC, a Delaware limited liability company ("CBM
Two")), upon the terms and subject to the conditions set forth in the Purchase
Offer and Consent Solicitation dated ____, 2000 (the "Purchase Offer and Consent
Solicitation");
WHEREAS, in addition to the Purchase Offer, the terms of the
Settlement Agreement provide for the merger of a subsidiary of the Joint Venture
with and into the Partnership immediately following the consummation of the
Purchase Offer;
WHEREAS, in order to effect the merger, the Joint Venture on
__________, 2000 caused the Purchaser to form Merger Sub, with the Purchaser
holding a 99% general partnership interest and CBM Mezzanine Borrower, LLC, a
Delaware limited liability company and a wholly owned subsidiary of the Joint
Venture ("CBM Mezzanine Borrower") holding a 1% limited partnership interest;
WHEREAS, pursuant to the terms of the Settlement Agreement and this
Agreement, Merger Sub will be merged with and into the Partnership (the
"Merger"); and
WHEREAS, immediately prior to the Merger, the Purchaser will acquire
99% of the membership interests in CBM Two.
NOW, THEREFORE, for and in consideration of the foregoing and of the
mutual covenants and agreements hereinafter set forth and other good and
valuable consideration, the parties, all intending to be legally bound hereby,
agree as follows:
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1. PLAN OF MERGER
1.1. The Merger
Upon the terms and subject to the conditions hereof, and in accordance
with the provisions of Section 17-211 of the Delaware Revised Uniform Limited
Partnership Act (the "DRULPA"), Merger Sub shall be merged with and into the
Partnership at the Effective Time (as defined below), with Units being converted
into cash (except that Units held by CBM Two and the Purchaser (including,
without limitation, the Units acquired in the Purchase Offer) shall be converted
into percentage interests in the Surviving Partnership (as defined below)), as
set forth in Sections 1.3 and 1.5 below. The Partnership shall be the surviving
entity of the Merger (the "Surviving Partnership"), and the separate existence
of Merger Sub will cease. The Surviving Partnership shall continue its
existence as a limited partnership under the laws of the State of Delaware, and
its name shall continue to be "Courtyard by Marriott II Limited Partnership."
CBM Two will continue to be the sole general partner of the Surviving
Partnership following the Merger. The partnership interests of the Purchaser
and CBM Mezzanine Borrower in Merger Sub will be canceled in the Merger.
1.2. Certificate of Merger; Effective Time
Upon the terms and subject to the conditions hereof, at or prior to
the Closing (as defined herein), the Partnership shall execute a Certificate of
Merger (the "Certificate of Merger") substantially in the form attached hereto
as Exhibit A and the Partnership shall file the Certificate of Merger with the
---------
Office of the Secretary of State of the State of Delaware in accordance with the
provisions of Section 17-211(c) of the DRULPA. The Merger shall become
effective at the time and on the date specified in the Certificate of Merger, or
absent any such indication, upon acceptance of filing (the "Effective Time").
The date on which the Effective Time occurs is referred to herein as the
"Effective Date."
1.3. Effects of Merger
The Merger shall have the effects set forth in the DRULPA. The
Partnership's Agreement of Limited Partnership as in effect immediately prior to
the Effective Time (the "Partnership Agreement") shall be adopted as the
partnership agreement of the Surviving Partnership and shall continue in full
force and effect after the Merger until further amended in accordance with the
terms and conditions thereof and applicable Delaware law. The sole general
partner of the Surviving Partnership shall continue to be CBM Two until it
withdraws or is removed in accordance with the Partnership Agreement, and the
limited partners of the Surviving Partnership immediately following the Merger
shall be the Purchaser and CBM Two.
1.4. Closing
The closing of the Merger (the "Closing") will take place at the time
and on the date to be specified by the parties and shall be (subject to
satisfaction or waiver of the conditions set forth herein) as soon as practical
following consummation of the Purchase Offer (the
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"Closing Date"), at the offices of ▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P., ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇,
▇.▇., ▇▇▇▇▇▇▇▇▇▇, ▇.▇. or such other place to which the parties may agree.
1.5. Conversion of Partnership Interests
At the Effective Time: (A) all partnership interests in Merger Sub
shall be cancelled, (B) the Units held by the Purchaser (including, without
limitation, the Units acquired in the Purchase Offer) shall be converted into a
93.61% limited partnership interest in the Surviving Partnership; (C) the 21.5
Units held by CBM Two shall be converted into a 1.39% limited partnership
interest in the Surviving Partnership, and CBM Two's general partnership
interest in the Partnership shall be unaffected by the Merger and remain
outstanding so that CBM Two shall own a 5% general partnership interest in the
Surviving Partnership; (D) each outstanding Unit (and fraction thereof) (other
than Units held by CBM Two or the Purchaser or by a holder who has elected to
opt-out of the Settlement (an "Opt-Out Holder")) shall be converted into the
right to receive $147,959 per Unit (or a pro rata portion thereof) in cash,
which amount shall be reduced by legal fees and expenses awarded by the court to
the class action plaintiffs in the ▇▇▇▇▇▇ Litigation and which shall further be
reduced by any amount owed by the holder on the original purchase price of such
Unit, such amount to be distributed in accordance with the terms of the
Settlement Agreement; and (E) each Unit held by an Opt-Out Holder shall be
converted into the right to receive cash in an amount equal to the Appraised
Value (as defined below) of such Unit. The Appraised Value of each Unit held by
an Opt-Out Holder shall be determined in the following manner. Two independent,
nationally recognized hotel valuation firms ________________________ and
________________________, which shall be approved by the Court (or, if the Court
does not approve such firms, such substitutes as may be approved by the Court),
will appraise the market value of the Partnership's hotels (the "Hotels") as of
the date that the order of the Court approving the terms of the Settlement and
the dismissal of the Litigation shall have become Final (each, as defined in the
Settlement Agreement), which appraisals will be completed within 60 days after
the Effective Time and set forth in a report certified by a MAI appraiser as
having been prepared in accordance with the requirements of the Standards of
Professional Practice of the Appraisal Institute and the Uniform Standards of
Professional Appraisal Practice of the Appraisal Foundation (which may be based
on site visits to 10 or more Hotels and a limited scope review deemed
appropriate by such appraisal firm). The Appraised Value of the Units in the
Merger shall be equal to the amount that Unitholders would receive if the entire
equity interest in the Partnership were sold for an amount equal to (i) the
average of the appraised values determined by the two appraisers plus (or minus)
(ii) the net working capital of the Partnership (to the extent not distributed
to the partners) minus (iii) the aggregate amount of indebtedness of the
Partnership and its subsidiaries minus (iv) the fair value of deferred
management fees accrued under the Management Agreement, restated as of December
30, 1995, between the Partnership and Courtyard Management Corporation minus (v)
the amount of any commitments for owner funded capital expenditures and the
estimated cost of any deferred maintenance with respect to the Partnership's
properties, and the proceeds of such sale were then distributed among the
partners of the Partnership in the same manner as liquidation proceeds in
accordance with the terms of the Partnership Agreement. The liquidity of the
Units will not be a factor in determining the Appraised Value of the Units.
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The Surviving Partnership will pay the Appraised Value of Units held by
Opt-Out Holders, without interest, to each Opt-Out Holder within 7 business days
after final determination of its Appraised Value, and payment shall be made by a
check mailed to the address of such Opt-Out Holder as set forth on the records
of the Partnership.
2. COVENANTS
2.1. Conduct of Business by the Partnership
From the date of this Agreement to the Effective Time, except as
required in connection with the Merger and the other transactions contemplated
by this Agreement and the Settlement Agreement or unless the Partnership obtains
prior written consent from the Joint Venture in each instance, the Partnership
will:
(a) Carry on its business as currently conducted and only in the usual
and ordinary course, and make no amendment (except as contemplated in the
Purchase Offer and Consent Solicitation) to its partnership agreement;
(b) Use its reasonable efforts to preserve its business organization
intact, to continue to operate the Partnership properties in a good and
businesslike fashion consistent with past practices and to maintain the
Partnership properties in good working order and condition in a manner
consistent with past practice;
(c) Not incur any material liability or make any material commitment
or enter into any other material transaction except in the ordinary and usual
course of business or pursuant to contracts existing on the date hereof;
(d) Not issue any Units or other Partnership interests or options or
rights to purchase Units or Partnership interests and not purchase any of its
Units;
(e) Not organize any subsidiary and not acquire or enter into an
agreement to acquire, by merger, consolidation or purchase of stock, interests
or assets, any business or entity; and
(f) Not enter into, modify, amend or terminate any material agreement
with respect to any of the Partnership properties, other than in the ordinary
course of business or pursuant to contracts existing on the date hereof, which
would encumber or be binding upon the Partnership properties from and after the
Effective Time.
2.2. Reasonable Efforts; Cooperation; Notification
Each of the parties shall use its commercially reasonable efforts to
take, or cause to be taken or do, or cause to be done, all things necessary,
proper or advisable under applicable law to obtain all required regulatory
approvals and shall cooperate fully with each of the other parties hereto and
their respective officers, trustees, directors, general partners, employees,
agents, counsel, accountants and other designees in connection with any steps
required to be
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taken as a part of its obligations under this Agreement. Each party shall do
such things as may be reasonably requested by the other parties in order to more
effectively consummate the Merger and the other transactions contemplated by
this Agreement, including, without limitation:
(a) The parties hereto shall promptly make any respective required
material filings and submissions with any agencies, boards, bureaus, courts,
commissions, departments or administrations of the United States government, any
state government or any local or other governmental body (a "Governmental
Entity") and shall take, or cause to be taken, all actions and do, or cause to
be done, all things necessary, proper or advisable under applicable material
statutes, laws, regulations, rules, judgments or decrees to obtain any required
consent or approval of any third party or any Governmental Entity necessary to
perform their respective obligations under this Agreement.
(b) The parties hereto shall cooperate and keep each other informed
regarding all filings with the Securities and Exchange Commission. The
Partnership and the Joint Venture shall give each other a reasonable opportunity
to review and comment on any filings relating to the Purchase Offer or the
Merger, promptly provide each other with copies of any comments or other
communications which either party or its counsel may receive from the Staff of
the Securities and Exchange Commission with respect to such filings, and afford
each other an opportunity to participate in any conversations with the
Securities and Exchange Commission with respect thereto.
(c) If any claim, action, suit, investigation or other proceeding by
any Governmental Entity or other person is commenced which questions the
validity or legality of the Merger or any of the other transactions contemplated
by this Agreement or seeks damages in connection therewith, the parties shall
cooperate and use all reasonable efforts to defend themselves against such
claim, action, suit, investigation or other proceeding and, if an injunction or
other order is issued in any such action, suit or other proceeding, to use
commercially reasonable efforts to have such injunction or other order lifted,
and to cooperate reasonably regarding any other impediment to the consummation
of the Merger or any of the other transactions contemplated by this Agreement.
(d) Each party shall give prompt written notice to the others of (i)
the occurrence, or failure to occur, of any event which occurrence or failure
will or is reasonably expected to result in the failure to satisfy any of the
conditions specified in Article 3 and (ii) any failure of the Partnership, the
Joint Venture or Merger Sub, as the case may be, to comply in any material
respect with any covenant or other agreement to be complied with under this
Agreement.
3. CONDITIONS TO CLOSING
3.1. Conditions to Each Party's Obligations
The obligations of each party to effect the Merger and to consummate
the other transactions contemplated by this Agreement to occur at the Effective
Time shall be subject to satisfaction at or prior to the Effective Time of the
following conditions:
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(a) the order of the Court approving the terms of the Settlement and
the dismissal of the Litigation shall have become Final;
(b) not more than 10% of the Units (other than Units held by the
persons named as Insiders in the Settlement Agreement) shall be held by holders
who have elected to "opt-out" of the Settlement;
(c) not more than 10% of the units of limited partnership interests in
each of the other six limited partnerships involved in the Settlement (other
than units held by persons named as Insiders in the Settlement Agreement) shall
be held by holders who have elected to "opt-out" of the Settlement; and
(d) limited partners holding a majority of the outstanding units of
limited partnership interests in each of the Partnership and Courtyard by
Marriott Limited Partnership (other than affiliates of these partnerships)
shall have submitted written consents to each partnership's merger and
amendments to each partnership's partnership agreement as provided in the
Purchase Offer and Consent Solicitation and the Purchase Offer and Consent
Solicitation for Courtyard by Marriott Limited Partnership dated _________,
2000.
Notwithstanding the foregoing, the conditions in clauses (b) and (c)
may be waived by the Joint Venture, the Purchaser and the Partnership in their
sole discretion.
4. TERMINATION, EXPENSES, AMENDMENT AND WAIVER
4.1. Termination
This Agreement may be terminated at any time prior to the Effective
Time, whether before or after the Certificate of Merger has been filed with the
Delaware Secretary of State (provided the Effective Time has not yet occurred):
(a) by mutual written consent of the parties hereto; or
(b) by either the Joint Venture or the Partnership, if the Settlement
Agreement shall be terminated.
4.2. Expenses
The Joint Venture shall pay all costs and expenses of the parties in
connection with the Merger and the other transactions contemplated by this
Agreement.
4.3. Amendment
This Agreement may be amended by the parties hereto at any time prior
to the Effective Time only pursuant to a writing executed (i) on behalf of the
Joint Venture, by each of the members of the Joint Venture, (ii) on behalf of
Merger Sub, by the Purchaser, and (iii) on behalf of the Partnership, by CBM
Two; provided, however, that any amendments that would
6
have a material adverse effect on the consideration to be received by the
Partnership's limited partners in the Merger must be approved by CBM Two and
holders of a majority of the Partnership's outstanding Units, unless such
amendment is approved by the Court.
4.4. Extension; Waiver
At any time prior to the Effective Time, the parties may (a) extend
the time for the performance of any of the obligations or other acts of the
other parties, or (b) waive (if waivable) compliance with any of the agreements
or conditions of the other parties contained in this Agreement. Any agreement
on the part of a party to any such extension or waiver shall be valid only if
set forth in an instrument in writing signed on behalf of such party and then
only to the extent expressly specified therein. No delay or failure of any
party to this Agreement to exercise or assert any of its rights under this
Agreement or otherwise shall not constitute a waiver of those rights.
5. MISCELLANEOUS
5.1. Notices
All notices, requests, claims, demands and other communications under
this Agreement shall be in writing and shall be delivered personally, sent by
overnight courier (providing proof of delivery) to the parties or sent by
telecopy (providing confirmation of transmission) at the following addresses or
telecopy numbers (or at such other address or telecopy number for a party as
shall be specified by like notice):
(a) if to the Partnership, to:
Courtyard by Marriott II Limited Partnership
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(b) if to the Joint Venture or Merger Sub to:
CBM Joint Venture LLC
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
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Marriott International, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with copies (which shall not constitute notice) to:
▇▇▇▇▇ & ▇▇▇▇▇▇▇ L.L.P.
▇▇▇ ▇▇/▇▇/ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: J. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇.
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
and
O'Melveny & ▇▇▇▇▇ LLP
▇▇▇ ▇▇/▇▇/ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
All notices shall be deemed given only when actually received.
5.2. Assignment and Binding Effect
This Agreement and the rights and obligations of the parties hereunder
may not be assigned by any party without the prior written consent of the other
parties hereto. This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns.
5.3. Governing Law
This Agreement, the rights and obligations of the parties hereto, and
any claims or disputes relating thereto, shall be governed and construed in
accordance with the laws of the State of Delaware (excluding the choice of law
rules thereof).
5.4. Severability
If any part of any provision of this Agreement shall be invalid or
unenforceable in any respect, such part shall be ineffective to the extent of
such invalidity or unenforceability only, without in any way affecting the
remaining parts of such provision or the remaining provisions of this Agreement.
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5.5. Further Assurances
In connection with this Agreement and the transactions contemplated
hereby, each party shall execute and deliver any additional documents and
instruments and perform any additional acts that may be necessary or appropriate
or reasonably requested by another party to effectuate and perform the
provisions of this Agreement and such transactions.
5.6. Counterparts
To facilitate execution, this Agreement may be executed in as many
counterparts as may be required. It shall not be necessary that the signatures
of, or on behalf of, each party, or that the signatures of all persons required
to bind any party, appear on each counterpart; but it shall be sufficient that
the signature of, or on behalf of, each party, or that the signatures of the
persons required to bind any party, appear on one or more of the counterparts.
All counterparts shall collectively constitute a single agreement. It shall not
be necessary in making proof of this Agreement to produce or account for more
than a number of counterparts containing the respective signatures of, or on
behalf of, all of the parties hereto.
[Signatures on Next Page]
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IN WITNESS WHEREOF, the parties hereto have duly executed this
Agreement and Plan of Merger, or have caused this Agreement and Plan of Merger
to be duly executed on their behalf, as of the day and year first above written.
CBM JOINT VENTURE LLC
By: Rockledge CBM Investor I, Inc.
By: ________________________________
Name:
Title:
By: Rockledge CBM Investor II, LLC
By: ________________________________
Name:
Title:
By: MI CBM Investor LLC
By: ______________________
Name:
Title:
COURTYARD BY MARRIOTT II LIMITED
PARTNERSHIP
By: CBM Two LLC, its sole general partner
By: ____________________________
Name:
Title:
CBM II ACQUISITION, L.P.
By: CBM Two LLC, its sole general partner
By: _____________________________
Name:
Title:
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EXHIBIT A
---------
Certificate of Merger
of
CBM II Acquisition, L.P.
into
Courtyard by Marriott II Limited Partnership
Pursuant to Section 17-211 of the Delaware Revised Uniform Limited
Partnership Act (the "Act"), Courtyard by Marriott II Limited Partnership, a
Delaware limited partnership (the "Partnership"), which is the surviving
partnership in the merger described below, hereby certifies that:
FIRST: The name and state of formation of each constituent entity that is
a party to the merger is as follows:
Name State of Formation
---- ------------------
CBM II Acquisition, L.P. Delaware
Courtyard by Marriott II
Limited Partnership Delaware
SECOND: An Agreement and Plan of Merger, dated as of _____, 2000 by and
among CBM Joint Venture LLC, a Delaware limited liability company, CBM II
Acquisition, L.P., a Delaware limited partnership ("Merger Sub") and the
Partnership (the "Agreement and Plan of Merger"), has been approved and executed
by each of the constituent entities in accordance with the requirements of
Section 17-211(b) of the Act.
THIRD: Pursuant to the Agreement and Plan of Merger, Merger Sub is merged
with and into the Partnership (the "Merger"), with the surviving limited
partnership being the Partnership. The Partnership shall continue its existence
under its present name under the laws of the State of Delaware.
FOURTH: The Merger shall be effective upon the filing of this Certificate
of Merger with the Secretary of State of the State of Delaware (such time, the
"Effective Time").
FIFTH: The Agreement and Plan of Merger is on file at the offices of the
Partnership at the following address:
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
A-1
SIXTH: A copy of the Agreement and Plan of Merger will be furnished by
the Partnership, on request and without cost, to any partner or any person or
entity holding an interest in any constituent limited partnership.
IN WITNESS WHEREOF, the Partnership has caused this Certificate of Merger
to be duly executed as of this _____ day of __________, 2000.
COURTYARD BY MARRIOTT II
LIMITED PARTNERSHIP
By: CBM Two LLC, its sole general partner
By:______________________________
Name:
Title:
A-2
