EXHIBIT 7
STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT, dated as of January 31, 2005 (this
"Agreement"), is entered into by and between JQH ACQUISITION LLC ("Bidder") and
_____________ ("Stockholder").
WHEREAS, as of the date hereof, Stockholder is the direct or indirect
beneficial owner of the shares of the Class A Common Stock, par value $.01 per
share (the "Common Stock"), of Xxxx X. Xxxxxxx Hotels, Inc., a Delaware
corporation (the "Company"), described in the form Schedule 13D of "JQH
Shareholders for Fair Play" originally filed with the Securities and Exchange
Commission on October 26, 2004, as the same from time to time may be amended,
currently ___________ shares (the "Shares");(1)
WHEREAS, the parties understand pursuant to public announcements that the
Special Committee of the Board of Directors of the Company (the "Special
Committee") granted to Barcelo Crestline Corporation an exclusive period of time
within which to negotiate to acquire all of the outstanding shares of the Common
Stock, which period shall expire on January 31, 2005;
WHEREAS, the Bidder intends, not later than January 31, 2005, to deliver
to the Special Committee a written proposal stating Bidder's willingness to
commence the Offer (defined below) subject only to the Conditions (defined
below) to purchase either all (in the case of a non-tender offer transaction) or
any and all of the Company's Common Stock (which Offer may include Common Stock
owned by the Company's founder, Xx. Xxxx X. Xxxxxxx or his trusts and affiliates
(collectively, "Xx. Xxxxxxx"), pursuant to an agreement between the Bidder and
Xx. Xxxxxxx which may include, inter alia, arrangements involving limited
partnership interests of Xxxx X. Xxxxxxx Hotels, LP, a Delaware limited
partnership (the "Partnership") owned by Xx. Xxxxxxx and other terms relating to
Xx. Xxxxxxx (the "Xxxxxxx Agreement")); and
WHEREAS, subject to the satisfaction of the Bidder's obligations contained
herein, the Stockholder agrees to support the Bidder's Offer during the term of
this Agreement, upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements contained herein the parties hereto agree as follows:
--------------------
(1) The language in this paragraph appears in the Stockholders Agreements
entered into by each of the Stockholders. The language in the corresponding
paragraph in the Stockholders Agreement entered into by Raffles is different and
reads as follows: "WHEREAS, as of the date hereof, Stockholder is the beneficial
owner of 129,800 shares (the "Shares") of the Class A Common Stock, par value
$.01 per share (the "Common Stock"), of Xxxx X. Xxxxxxx Hotels, Inc., a Delaware
corporation (the "Company");
ARTICLE I
BIDDER'S OBLIGATIONS.
Section 1.01 The Bidder intends, not later than January 31, 2005, to
deliver to the Special Committee, in writing, a notification of the Bidder's
willingness to commence the Offer as promptly as practicable. As used herein,
the term "Offer" means a fully-financed (i.e., not contingent on financing),
bona fide offer by the Bidder to purchase or otherwise acquire (whether by
tender offer, merger or otherwise) either all (in the case of a non-tender offer
transaction) or any and all of the Common Stock of the Company at a purchase
price, gross to the transferee, of not less than $24.00 per share, subject to
the conditions described below.
Section 1.02 The Offer may be made subject only to the Conditions. The
term "Conditions" as used herein means:
(a) that the Company's prior public filings are materially accurate;
(b) that all governmental and other required consents and approvals, if
any, shall have been obtained, including without limitation approvals under the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended;
(c) the execution on terms satisfactory to the Bidder of the Xxxxxxx
Agreement;
(d) approval of the Offer by the Company's Board of Directors (the
"Board") and, if legally required or if required by the Board or any committee
thereof formed for the purposes of evaluating the Offer, the requisite
percentage of the Company's stockholders; and
(e) such material adverse change condition as may be mutually agreeable
to the Company and Bidder.
ARTICLE II
STOCKHOLDER'S OBLIGATIONS.
Section 2.01 Subject to the Bidder's delivery of the Offer pursuant to
Article 1 above and the Bidder's continued compliance with the terms and
conditions contained herein, the Stockholder shall, during the Term hereof
(defined below):
(a) advise the Special Committee, the Company's Board of Directors and
Xx. Xxxxxxx and their respective representatives, of the Stockholder's support
of the Bidder's Offer; and
(b) vote in favor of the Bidder's Offer and against any other
acquisition proposal or other proposals which are inconsistent with or
detrimental to the expeditious consummation of Bidder's Offer.
Section 2.02 In the event the Stockholder sells Shares pursuant to an
Offer made during the Term to the Bidder or a third party pursuant to a tender
offer, merger or other share sale program open generally to all holders of
Common Stock made during the Term (other than Xx. Xxxxxxx, if so elected by the
Bidder) (a "Share Sale") at a price (the "Share Sale Price")
-2-
above $24.00 per share (which price shall not be reduced or offset by
Stockholder's expenses), the Stockholder will concurrently with the Share Sale
pay to the Bidder, as set forth herein, an amount equal to 20% of the Share Sale
Price above $24.00 per share for each Share sold by the Stockholder in the Share
Sale (the "Premium"); provided that in the event that the Stockholder is
entitled to participate in a Share Sale but elects not to do so, then within 5
days following consummation of such Share Sale, the Stockholder shall pay to the
Bidder an amount equal to the Premium for each Share which the Stockholder
elects not to include in such Share Sale. The Stockholder shall pay to the
Bidder, in the Stockholder's discretion, the Premium (i) in cash, (ii) in
Shares, with the Shares valued at the Share Sale Price, provided that such
Shares shall be delivered to the Bidder with sufficient time to permit the
Bidder to participate in the Share Sale with respect to such Shares (and
provided that the Bidder is entitled to so participate); otherwise the
Stockholder will tender such Shares into the Share Sale on the Bidder's behalf
and deliver the proceeds thereof to the Bidder, or (iii) any combination of (i)
or (ii).
Section 2.03 Notwithstanding the foregoing, the Stockholder may purchase
additional shares of Common Stock (which stock shall thereupon be deemed Shares
for purposes of this Agreement) or transfer any or all of the Shares to one or
more persons other than in a Share Sale; provided that no such transfers shall
be made if the effect would be to result in more than 10 stockholders in the
aggregate having entered into agreements to support Bidder's Offer; and further
provided, that each such person acquiring Shares shall be bound by the terms and
conditions of this Agreement with respect to the Shares so acquired; further
provided that prior to consummating such transfer, the Stockholder shall have
provided the Bidder with written evidence that each such person acquiring Shares
has agreed to be so bound, along with the name, address and phone number of each
such person; and further provided that Stockholder shall be responsible for any
breach of this Agreement by any such transferee.
Section 2.04 This Agreement shall terminate (the "Term"):
(a) ab initio and be of no effect in the event the Bidder fails
to deliver to the Special Committee notification of Bidder's willingness to
commence the Offer, in accordance with Section 1.01 hereof, on or prior to
January 31, 2005; and
(b) unless extended pursuant to (c) below, April 29, 2005 (the
"Initial Term").
(c) Bidder may request that the Stockholder extend this Agreement beyond
the Initial Term, and the Stockholder shall be obligated to so extend, if (x)
the Bidder, Xx. Xxxxxxx and the Company are engaged in good faith, bona fide
negotiations and the Bidder reasonably believes that it is likely to negotiate
successfully (i) a definitive agreement with the Company and (ii) the Xxxxxxx
Agreement or (y) the Bidder wishes and is prepared to pursue such good faith,
bona fide negotiations and has sought and is continuing to seek with Xx. Xxxxxxx
and the Company such good faith, bona fide negotiations, but either or both of
Xx. Xxxxxxx and the Company have refused or failed to respond or negotiate in
good faith. Upon such request and assuming the conditions in (x) or (y) above
are satisfied, the Term of the Agreement shall be extended to the earlier of the
following to occur (the "Extension Term"):
(i) if the Bidder successfully consummates a definitive agreement with
the Company and the Xxxxxxx Agreement, the closing date for such transaction;
and
-3-
(ii) October 31, 2005.
(d) notwithstanding the forgoing, this Agreement shall automatically
terminate and be of no further effect if the Bidder, in its sole discretion,
withdraws or abandons the Offer, in which case the Bidder agrees and covenants
to immediately notify the Stockholder of such withdrawal or abandonment.
(e) In the event that the Bidder wishes and is prepared to pursue good
faith, bona fide negotiations and has sought and is continuing to seek with Xx.
Xxxxxxx and the Company such good faith, bona fide negotiations, but either or
both of Xx. Xxxxxxx and the Company have refused or failed to respond or
negotiate in good faith, the Stockholder shall use reasonable, good faith
efforts to encourage the Company and Xx. Xxxxxxx to engage in such negotiations.
Section 2.05 If the Bidder requests that the Stockholder extend the Term
of the Agreement pursuant to Section 2.04(c) above, the Bidder shall deliver to
the Stockholder prior to the expiration of the Initial Term information
regarding (a) the status of the Bidder's good faith, bona fide negotiations with
the Company and Xx. Xxxxxxx with respect to completion of a definitive agreement
and the Xxxxxxx Agreement, (b) the Bidder's intention to commence the Offer as
promptly as practicable and (c) such other information regarding the Offer and a
Share Sale as the Stockholder may reasonably request in support of the Bidder's
representations under Section 2.04(c).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER.
The Stockholder hereby represents and warrants to the Bidder as of the
date hereof as follows:
Section 3.01 Organization. If the Stockholder is a corporation, limited
liability company or limited partnership, the Stockholder is duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
organization.
Section 3.02 Authorization; Validity of Agreement; Necessary Action. The
Stockholder has all necessary power and authority, and if an individual,
capacity, to execute and deliver this Agreement and to perform his, her or its
obligations hereunder. The execution, delivery and performance of this Agreement
has been duly and validly authorized by all necessary action and no other
proceedings on the part of the Stockholder are necessary to authorize the
execution and delivery of this Agreement. This Agreement has been duly and
validly executed and delivered by the Stockholder, and constitutes the legal,
valid and binding obligation of the Stockholder, enforceable against him, her or
it in accordance with its terms.
-4-
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BIDDER.
The Bidder hereby represents and warrants to Stockholder as of the date
hereof as follows:
Section 4.01 Organization. The Bidder is a limited liability company duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation.
Section 4.02 Corporate Authorization; Validity of Agreement; Necessary
Action. The Bidder has all necessary corporate power and authority to execute
and deliver this Agreement and to perform its obligations hereunder. The
execution, delivery and performance by the Bidder of this Agreement and the
consummation by it of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action and no other corporate
proceedings on the part of the Bidder are necessary to authorize the execution
and delivery by it of this Agreement and the consummation by it of the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by the Bidder, and constitutes the legal, valid and
binding obligation of Bidder, enforceable against Bidder in accordance with its
terms.
ARTICLE V
MISCELLANEOUS.
Section 5.01 Costs and Expenses. All costs and expenses incurred in
connection with this Agreement and the consummation of the transactions
contemplated hereby shall be paid by the party incurring such expenses.
Section 5.02 Amendment and Modification. This Agreement may be amended,
modified or supplemented in any and all respects only by written agreement of
the parties hereto.
Section 5.03 Notices. All notices and other communications hereunder shall
be in writing and shall be deemed given if delivered personally, telecopied
(which is confirmed) or sent by an overnight courier service (providing proof of
delivery) to the parties at the following addresses (or at such other address
for a party as it may specify by like notice):
(a) if to Bidder:
JQH Acquisition LLC
000 Xxxx 00xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
with a copy to:
Xxxx Xxxxxxx LLP
00 Xxxx Xxxxxxx Xxxxxx
-0-
Xxxxx 0000
Xxxxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxxx
Fax No: (000) 000-0000
(b) if to Stockholder, to:
with a copy to:
Section 5.04 Interpretation. When a reference is made in this Agreement to
Sections, such reference shall be to a Section of this Agreement unless
otherwise indicated. Whenever the words "include," "includes" or "including" are
used in this Agreement they shall be deemed to be followed by the words "without
limitation." The phrases "the date of this Agreement," "the date hereof," and
terms of similar import, unless the context otherwise requires, shall be deemed
to refer to January 31, 2005.(2)
Section 5.05 Counterparts. This Agreement may be executed in two or more
counterparts, all of which shall be considered one and the same agreement and
shall become effective when two or more counterparts have been signed by each of
the parties and delivered to the other parties, it being understood that all
parties need not sign the same counterpart.
Section 5.06 Entire Agreement; No Third Party Beneficiaries. This
Agreement and the Confidentiality Agreement, dated as of January 4, 2005,
between Stockholder and/or its affiliates and Bidder and/or its affiliates,
constitute the entire agreement and supersedes all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof, and is not intended to confer upon any person other than
the parties hereto any rights or remedies hereunder.
Section 5.07 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party.
All rights, powers and remedies provided under this Agreement or otherwise
available in respect hereof at law or in equity shall be cumulative and not
alternative, and the
------------------------
(2) This is the date appearing in the Stockholders Agreements entered into by
each of the Stockholders. The date appearing in this paragraph in the
Stockholders Agreement entered into by Raffles is January 19, 2005.
-6-
exercise of any thereof by any party shall not preclude the simultaneous or
later exercise of any other such right, power or remedy by such party.
Section 5.08 Governing Law. This Agreement shall be governed and construed
in accordance with the laws of the State of Delaware without giving effect to
the principles of conflicts of law thereof.
Section 5.09 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder may be assigned by the parties hereto
(whether by operation of law or otherwise) without the prior written consent of
the other party, provided, however, the Stockholder may as set forth in Section
2.03 above transfer the Shares subject to the acquirer's acquiescence to the
terms of this Agreement and provided, further, the Bidder may assign any or all
of its rights, interests and obligations hereunder to any of its affiliates
provided that no such assignment shall relieve Bidder from any of its
obligations hereunder. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of and be enforceable by the parties and
their respective successors, heirs, agents, representatives, trust
beneficiaries, attorneys, affiliates and associates and all of their respective
predecessors, successors, permitted assigns, heirs, executors and
administrators.
Section 5.10 Consent to Jurisdiction; Waiver of Jury Trial; Specific
Performance. In any action or proceeding between any of the parties arising out
of or relating to this Agreement or any of the transactions contemplated by this
Agreement, each of the parties: (a) irrevocably and unconditionally consents and
submits to the exclusive jurisdiction and venue of the Chancery Court of the
State of Delaware and the United States District Court for the District of
Delaware and (b) agrees that all claims in respect of such action or proceeding
may be heard and determined exclusively in such courts. For purposes of
implementing the foregoing, Stockholder hereby appoints Corporation Services
Company, and Bidder hereby appoints CT Corporation, as agent to service of
process in the State of Delaware in connection with this Agreement.
SECTION 5.11 EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY
WAIVES TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING IN RELATION TO THIS
AGREEMENT AND FOR ANY COUNTERCLAIM THEREIN.
Section 5.12 No Broker's Fees. No broker, finder, investment banker or
other person is entitled to any broker's, finder's or other fee or commission in
connection with the transactions contemplated hereby based upon arrangements
made by or on behalf of Stockholder.
Section 5.13 Neutral Construction. The language of this Agreement shall be
deemed to be the language mutually chosen by the Stockholders and the Bidder and
no doctrine of construction shall be applied against any party.
Section 5.14 Injunction. The parties acknowledge and agree that Bidder and
Stockholder would be irreparably damaged if any of the provisions of this
Agreement are not performed in accordance with their specific terms and that any
breach of this Agreement could not be adequately compensated in all cases by
monetary damages alone. Accordingly, in addition to any other right or remedy to
which Bidder or Stockholder may be entitled, at law or
-7-
in equity, it shall be entitled to enforce any provision of this Agreement by a
decree of specific performance and temporary, preliminary and permanent
injunctive relief to prevent breaches or threatened breaches of any of the
provisions of this Agreement, without posting any bond or other undertaking.
Section 5.15 Acknowledgement. Stockholder and Bidder each acknowledge that
the other may possess material non-public information not known to the
Stockholder regarding or relating to the Company or the Common Stock, whether
obtained from the Company under an agreement of confidentiality or otherwise,
including, but not limited to, information concerning the business, financial
condition, results of operations, prospects or plans of the Company or plans for
the Company, and that such information may be material to the value of the
Common Stock; and Stockholder and Bidder each further acknowledge that it has
not requested any such information and agrees that neither party nor its
affiliates shall have any liability whatsoever (and hereby waives and releases
all claims that it may otherwise have) with respect to the non-disclosure of
such information, whether before or after the date of this letter.
-8-
IN WITNESS WHEREOF, Bidder and Stockholder have caused this Agreement to
be signed by their respective officers or other authorized person thereunto duly
authorized as of the date first written above.
STOCKHOLDER
By: _________________________________________
Name:
Title:
BIDDER
By: _________________________________________
Name:
Title:
