STOCK PURCHASE AGREEMENT by and between LODGENET ENTERTAINMENT CORPORATION and PAR INVESTMENT PARTNERS, L.P. December 7, 2006
Exhibit 10.36
Execution Copy
by and between
LODGENET ENTERTAINMENT CORPORATION
and
PAR INVESTMENT PARTNERS, L.P.
December 7, 2006
This STOCK PURCHASE AGREEMENT (the “Agreement”) is entered into as of December 7, 2006 (the
“Agreement Date”), by and between LodgeNet Entertainment Corporation, a Delaware
corporation (“Seller” or “LodgeNet”), and PAR Investment Partners, L.P., a Delaware
limited partnership (“Buyer”; Buyer and Seller are referred to individually as a “Party”
and collectively as the “Parties.”)
RECITALS
A. Seller has entered into a Stock Purchase Agreement, of even date herewith, with Liberty
Satellite & Technology, Inc. (“LS&T”) and Liberty Media Corporation (in the form attached hereto as
Exhibit A, the “Liberty SPA”), pursuant to which Seller will acquire 100% of the issued and
outstanding shares of capital stock of Ascent Entertainment Group, Inc. (the “Acquisition”), which
prior to the Acquisition owned 100% of the issued and outstanding shares of capital stock of On
Command Corporation, a Delaware corporation (“ONCO”).
B. Pursuant to the Liberty SPA, at the closing of the Acquisition, and as part of the
consideration for such Acquisition, Seller will issue 2,050,000 shares of its common stock to LS&T.
C. Concurrently therewith, Seller desires to sell to the Buyer and Buyer desires to purchase
from the Seller 1,000,000 shares of common stock, par value $.01 per share (the “Shares”) of the
Seller, for the consideration and subject to the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the mutual promises and covenants contained in this
Agreement, and intending to be legally bound, the parties agree as follows:
ARTICLE I
DEFINITIONS
DEFINITIONS
Section 1.1. Definitions. The following terms have the following meanings for purposes of this
Agreement:
“Affiliate” means, with respect to any Person, any other Person that, directly or
indirectly, Controls or is Controlled by or is under common Control with such Person.
“Agreement” has the meaning set forth in the preamble.
“Agreement Date” has the meaning set forth in the preamble.
“Buyer” has the meaning set forth in the preamble.
“Closing” has the meaning set forth in Section 2.3.
“Closing Date” has the meaning set forth in Section 2.34.
| “Beneficial Ownership and derivative terms.” As determined pursuant to Rule 13d-3 and Rule 13d-5 under the Exchange Act and any successor regulation, except that in determining Beneficial Ownership, without duplication, equity securities that may be acquired pursuant to rights to acquire equity securities that are exercisable more than sixty days after a date shall nevertheless be deemed to be Beneficially Owned. |
“Blackout Period.” As defined in Section 7.6 below.
“Board.” The Board of Directors of LodgeNet.
| “Business Days” means any day other than Saturday, Sunday, or a day on which banking institutions of the State of New York are authorized by law or executive order to close. | ||
| “Current Filings” has the meaning set forth in Section 4.7. | ||
| “Encumbrance” means any mortgage, pledge, assignment, lien, charge, restriction, encumbrance or security interest of any kind or nature. | ||
| “Exchange Act.” The Securities Exchange Act of 1934, as amended, and the rules and regulations thereunder. | ||
| “Free Writing Prospectus.” A free writing prospectus as defined in Rule 405 under the Securities Act. |
| “GAAP” means generally accepted accounting principles in the United States set forth in the opinions and pronouncements of the Accounting Principles Board (and its predecessors), the American Institute of Certified Public Accountants and the Financial Accounting Standards Board that are applicable to the circumstances as of the date of determination, consistently applied. |
“Issuer Free Writing Prospectus.” An issuer free writing prospectus as defined
in Rule 433 under the Securities Act.
“LodgeNet” has the meaning set forth in the preamble.
“LodgeNet Securities” means any equity securities of LodgeNet.
| “PAR Shares” means the Shares and the 1,156,997 shares of LodgeNet common stock previously purchased and currently owned by Buyer on the date hereof. | ||
| “Party” or “Parties” has the meaning set forth in the preamble. |
| “Person” means an individual, a partnership, a limited liability company, a corporation, an association, a joint stock company, a trust, a joint venture, an unincorporated organization, any other entity, or a Governmental Authority. |
“Piggyback Notice.” As defined in Section 7.3 below.
“Piggyback Registration.” As defined in Section 7.3 below.
| “Prospectus.” The prospectus included in the applicable Registration Statement, as supplemented by any and all prospectus supplements and as amended by any and all amendments (including post-effective amendments) and including all material incorporated by reference or deemed to be incorporated by reference in such Prospectus. |
“Purchase Price” has the meaning set forth in Section 2.2.
| “Registrable Securities” means the Shares; provided, however, that as to any Registrable Securities, such securities will irrevocably cease to constitute Registrable Securities upon the earliest to occur: (i) the date on which the securities are disposed of pursuant to an effective registration statement under the Securities Act; (ii) the date on which all of such securities are eligible to be sold by Buyer to the public pursuant to Rule 144(k) (or any successor provision) under the Securities Act; (iii) the date on which the securities have been transferred to any Person other than Buyer, except in accordance with a Permitted Transfer; or (iv) the date on which the securities cease to be outstanding. |
“Registration Expenses.” As defined in Section 7.14 below.
| “Registration Statement.” Any registration statement of LodgeNet under the Securities Act that covers any of the Registrable Securities pursuant to the provisions of this Agreement, including the related Prospectus, all amendments and supplements to such registration statement (including post-effective amendments), and all exhibits and all materials incorporated by reference or deemed to be incorporated by reference in such registration statement. |
| “Restricted Period.” The period of time commencing on the Closing Date and ending on the date that is six (6) months after the Closing Date. | ||
| “Rule 144.” Rule 144 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the SEC. | ||
| “SEC.” The United States Securities and Exchange Commission and any successor United States federal agency or governmental authority having similar powers. | ||
| “Securities Act.” The Securities Act of 1933, as amended, and the rules and regulations thereunder. |
| “Seller” has the meaning set forth in the preamble. | ||
| “Shares” has the meaning set forth in Recital C. | ||
| “Shelf Registration.” As defined in Section 7.1 below. | ||
| “Subsidiaries” means all Persons that the Company directly or indirectly controls. | ||
| “Underwritten Registration” or “Underwritten Offering.” A registration in which LodgeNet Securities are sold to an underwriter for reoffering to the public. |
ARTICLE II
PURCHASE AND SALE OF SHARES; CLOSING
PURCHASE AND SALE OF SHARES; CLOSING
Section 2.1. Purchase and Sale of Shares. Subject to the terms and conditions set
forth in this Agreement, at the Closing, Seller will sell and transfer the Shares to Buyer, and
Buyer will purchase the Shares from Seller, free and clear of any and all Encumbrances, as set
forth in this Article II.
Section 2.2. Purchase Price. The aggregate purchase price for the Shares will be
$23,370,000 (the “Purchase Price”).
(a) The Purchase Price will be paid at the Closing by wire transfer of immediately available
funds pursuant to wire instructions provided by Seller to Buyer no later than two (2) Business Days
prior to the Closing Date, or by such other means as may be agreed between the Parties hereto.
Seller shall deliver to Buyer a certificate or certificates representing the Shares to be purchased
by, and sold to, the Buyer pursuant to Section 2.1 hereof, registered in the names and in the
denominations designated and provided by the Buyer at least three (3) Business Days prior to the
Closing Date.
Section 2.3. Closing. The closing of the transactions contemplated by this Agreement
(the “Closing”) will take place at the offices of Xxxxxxx, Street and Deinard in
Minneapolis, Minnesota on the date on which the Acquisition is closed or at such other time and
place as the Parties may mutually agree in writing (the “Closing Date”).
ARTICLE III
BUYER’S REPRESENTATIONS AND WARRANTIES
BUYER’S REPRESENTATIONS AND WARRANTIES
Section 3.1. Organization of Buyer. Buyer is a limited partnership duly organized, validly
existing, and in good standing under the laws of the State of Delaware.
Section 3.2. Authorization; Binding Effect. Buyer has all requisite partnership power and
authority to execute and deliver this Agreement and to perform its obligations under this
Agreement, and this Agreement has been duly executed and delivered by Buyer. This Agreement
constitutes and, when executed and delivered by Buyer at the Closing will constitute, a legal,
valid, and binding obligation of Buyer, enforceable against Buyer in accordance with its terms,
except insofar as enforcement may be limited
| by bankruptcy, insolvency, or other laws affecting generally the enforceability of creditors’ rights and by limitations on the availability of equitable remedies. |
Section 3.3. Noncontravention; Consents. Neither the execution and delivery of this
Agreement, nor the consummation of the transactions contemplated by this Agreement, will (a)
violate any material legal requirement to which Buyer is subject or any provision of the
certificate of limited partnership or governing documents of Buyer or (b) result in a material
breach of, constitute a material default under, result in the acceleration of, create in any Person
the right to accelerate, terminate, modify or cancel, any contract, agreement, lease, license or
other arrangement to which Buyer is a party or by which it is bound or to which its assets are
subject. Except for an filing required under the xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended (the “HSR Act”) (if any) Buyer is not required to give any notice to, make any
filing with, or obtain any authorization, consent, or approval of any Governmental Authority or
other Person in order for Buyer to consummate the transactions contemplated by this Agreement.
Section 3.4. Brokers’ Fees. Buyer has no obligation to pay any fees or commissions to
any broker, finder, or agent with respect to the transactions contemplated by this Agreement.
Section 3.5. Investment Intent. Buyer is acquiring the Shares under this Agreement
solely for the purpose of investment for its own account, not as a nominee or agent, and not with a
view to, or for sale in connection with, any distribution of any part thereof within the meaning of
Section 2(11) of the Securities Act or any applicable state securities or “blue sky laws”.
Section 3.6. Disclosure of Information; Non-reliance. Buyer has been furnished all
information it considers necessary or appropriate for deciding whether to accept the Shares. Buyer
has had an opportunity to ask questions and receive answers from Seller regarding the business,
properties, financial condition and prospects of the Seller, and all such questions have been
answered to the full satisfaction of the Buyer. In making its decision to purchase the Shares,
Buyer has relied solely on its own investigation of Seller and has not relied on any opinions,
analyses, representations or warranties of Seller or any third party, except for the
representations and warranties contained in Article IV hereof.
Section 3.7. Accredited Investor. Buyer is an “accredited investor” as such term is
defined in Rule 501 of Regulation D under the Securities Act.
Section 3.8. Current Ownership. As of the Agreement Date, Buyer owns 1,156,997 shares
of common stock of Seller.
Section 3.9. Restricted Securities. Buyer understands that the Shares are
characterized as “restricted securities” under the United States federal securities laws inasmuch
as such Shares are being acquired in a transaction not involving a public offering and that under
such laws and applicable regulations such Shares may be resold without registration under the
Securities Act only in certain limited circumstances. In the
| absence of an effective registration statement covering such Shares or an available exemption from registration under the Securities Act, such Shares must be held indefinitely. |
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows:
Section 4.1. Organization of Seller. Seller is a corporation duly organized, validly
existing, and in good standing under the laws of the State of Delaware.
Section 4.2. Authorization; Binding Effect.
(a) Seller has all requisite corporate power and authority to execute and deliver this
Agreement and such other documents as required to consummate the Acquisition and to perform its
obligations under this Agreement and such other documents as required to consummate the
Acquisition. As of the Closing Date, this Agreement has been duly executed and delivered by
Seller.
(b) This Agreement constitutes the legal, valid, and binding obligation of Seller, enforceable
against Seller in accordance with its terms, except insofar as enforcement may be limited by
bankruptcy, insolvency, or other laws affecting generally the enforceability of creditors’ rights
and by limitations on the availability of equitable remedies.
Section 4.3. Noncontravention; Consents. Neither the execution and the delivery of
this Agreement nor the consummation of the transactions contemplated by this Agreement will (a)
violate any material legal requirement to which Seller is subject or any provision of the
certificate of incorporation or bylaws (or comparable constituent documents) of Seller or (b)
result in a material breach of, constitute a material default under, result in the acceleration of,
create in any party the right to accelerate, terminate, modify, or cancel, any contract, agreement,
lease, license, or other arrangement to which Seller is a party or by which it is bound or to which
its assets are subject. Except for the filing of a Form D with the SEC (if required), Seller does
not need to give any notice to, make any filing with, or obtain any authorization, consent, or
approval of any Governmental Authority or other Person in order for Buyer and Seller to consummate
the transactions contemplated by this Agreement.
Section 4.4. Certain Proceedings. There is no proceeding against or involving Seller
or any Affiliate of Seller that has been commenced or, to Seller’s knowledge, threatened against or
involving Seller or any Affiliate of Seller that challenges, or may have the effect of preventing,
delaying, making illegal, or otherwise interfering with, any of the transactions contemplated by
this Agreement.
Section 4.5. Brokers’ Fees. Seller has no obligation to pay any fees or commissions
to any broker, finder, or agent with respect to the transactions contemplated by this Agreement.
Section 4.6. Delivery of Shares. The Shares being issued and delivered hereunder,
when issued and delivered in accordance with the terms of this Agreement for the consideration
expressed herein, will be duly authorized, validly issued, fully paid and non-assessable. The
transfer and delivery of such Shares by Seller to Buyer against the payment of the Purchase Price
as contemplated by this Agreement will transfer good and valid title to the Shares, free and clear
of all Encumbrances.
Section 4.7. SEC Filings; Financial Information.
(a) Seller is a publicly traded company that is listed on The NASDAQ Global Market under the
ticker symbol “LNET” and files reports, registration and proxy statements and other information
with the SEC on its XXXXX System, all of which are available to Buyer over the internet at the
SEC’s web site at xxxx://xxx.xxx.xxx.
(b) Since January 1, 2006, Seller has filed in a timely manner all required reports,
schedules, forms, statements, and other documents with the SEC that Seller was required to file
under Section 13, 14(a), and 15(d) of the Exchange Act (the “SEC Filings”). As of their respective
filing dates, (i) the SEC Filings complied in all material respects with requirements of the
Securities Act or the Exchange Act, as the case may be and the rules and regulations of the SEC
promulgated thereunder applicable to such SEC Filings, and (ii) none of the SEC Filings contained
any untrue statement of a material fact or omitted to state a material fact required to be stated
therein or necessary in order to make the statements therein, in light of the circumstances under
which they were made, not misleading. Except to the extent that information contained in any SEC
Filing has been revised or superseded by a later filed SEC Filing, none of the SEC Filings contains
any untrue statement of a material fact or omits to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the circumstances under
which they were made, not misleading.
(c) The financial information for Seller and its subsidiaries contained in the SEC Filings
fairly present in all material respects, as of the dates thereof and for the periods then ended,
the financial position and results of operations of Seller and its consolidated subsidiaries in
conformity with GAAP (except as indicated in the notes thereto), subject to normal year-end
adjustments (that are not material, either individually or in the aggregate) with respect to
unaudited financial statements. Except as set forth in the SEC Filings, neither Seller nor any of
its subsidiaries has any material liabilities or obligations of any nature (whether accrued,
absolute, contingent or otherwise) required by GAAP to be set forth on a consolidated balance sheet
of Seller and its consolidated subsidiaries or in the notes thereto.
Section 4.8. Capital Stock and Ownership of Seller.
(a) The authorized capital stock of Seller consists of 50,000,000 shares of Common Stock and
5,000,000 shares of preferred stock, $.01 par value. As of the date hereof, Seller has (i)
18,690,073 issued and outstanding shares of Common Stock, all of which are validly issued, fully
paid, and non-assessable; and (ii) no shares of issued or
| outstanding Preferred Stock. No shares of Common Stock or Preferred Stock that have been issued are held by Seller in its treasury. |
(b) As of the date hereof, Seller has (i) outstanding options to purchase a total of 2,175,775
shares of Common Stock under the LodgeNet Entertainment Corporation 2003 Stock Option and Incentive
Plan and the LodgeNet Entertainment Corporation 1993 Stock Option Plan (collectively, the “Plans”)
and (ii) 180,050 shares of unvested restricted stock outstanding. As of the date hereof, 696,638
additional shares of Common Stock are available for issuance under the Plans.
(c) Except for (x) options issued under and in accordance with the Plans; and (z) as contained
in this Agreement and the Liberty SPA, there are no options, warrants, convertible securities, or
other rights, agreements, arrangements, or commitments of any character obligating Seller to issue
or sell any additional shares of capital stock of, or other equity interest in, Seller.
Section 4.9. Liberty SPA. True, correct and complete copies of the Liberty SPA and
the Stockholders Agreement, dated December 6, 2006, among LodgeNet, LS&T and Liberty Media
Corporation are attached hereto as Exhibits A and B, respectively.
ARTICLE IVA
COVENANTS
Section 4A.1. Taking of Necessary Action. (a) Seller and Buyer shall cooperate with
each other and use their respective reasonable best efforts to take or cause to be taken all
actions, and do or cause to be done all things, necessary, proper or advisable on its part under
this Agreement and applicable law to consummate and make effective the transactions contemplated by
this Agreement as soon as practicable, including preparing and filing as promptly as practicable
all documentation to effect all necessary notices, reports and other filings and to obtain as
promptly as practicable all consents, registrations, approvals, permits and authorizations
necessary or advisable to be obtained from any third party and/or any governmental authority,
including under the HSR Act.
Section 4A.2. Notification Requirements. Seller shall promptly, but in no event later
than five (5) Business Days, notify Buyer in writing if any of the events referred to in Sections
8.1(b), (c) or (d) shall have occurred or if Seller intends to take any of the actions referred to
in Sections 8.1(b) or (c).
ARTICLE V
CONDITIONS TO CLOSING
CONDITIONS TO CLOSING
Section 5.1. Conditions to Obligation of Buyer. The obligation of Buyer to purchase
the Shares and to take any other such actions required to be taken by Buyer at the Closing is
subject to the satisfaction, at or prior to the Closing, of each of the following conditions (any
of which may be waived by Buyer, in whole or in part):
(a) the representations and warranties set forth in Article III shall be true and correct as
of the date hereof and true and correct in all material respects as of the Closing Date;
(b) the closing of the Acquisition shall have occurred on the terms set forth in the Liberty
SPA;
(c) if required, the waiting period under the HSR Act shall have expired or been terminated
and any applicable foreign antitrust approvals required by applicable Antitrust Law shall have been
obtained without any Governmental Authority taking any action to prevent the consummation of the
transactions contemplated by this Agreement;
(d) no Proceeding against the Buyer shall be pending before any Governmental Authority and no
statute, judgment, order, decree, ruling, injunction, or charge shall be in effect, which
reasonably could (i) prevent or materially delay the consummation of any of the transactions
contemplated by this Agreement, or (ii) cause any of the transactions contemplated by this
Agreement to be rescinded following consummation; and
(e) the Shares to be issued to Buyer under this Agreement shall have been authorized for
listing or quotation, as applicable, on the NASDAQ Stock Market upon official notice of issuance.
Section 5.2. Conditions to Obligation of Seller. The obligation of Seller to sell the
Shares and to take any other such actions required to be taken by Seller at the Closing is subject
to the satisfaction, at or prior to the Closing, of each of the following conditions (any of which
may be waived by Seller, in whole or in part):
(a) the representations and warranties set forth in Article IV shall be true and correct in
all material respects as of the Closing Date;
(b) if required, the waiting period under the HSR Act shall have expired or been terminated
and any applicable foreign antitrust approvals shall have been obtained without any Governmental
Authority taking any action to prevent the consummation of the transactions contemplated by this
Agreement;
(c) no Proceeding against the Seller shall be pending before any Governmental Authority, and
no statute, judgment, order, decree, ruling, injunction, or charge shall be in effect, which
reasonably could (i) prevent or materially delay the consummation of any of the transactions
contemplated by this Agreement or (ii) cause any of the transactions contemplated by this Agreement
to be rescinded following consummation; and
(d) the closing of the Acquisition shall have occurred.
ARTICLE VI
STANDSTILL PROVISIONS
STANDSTILL PROVISIONS
Section 6.1. Dispositions of LodgeNet Securities.
(a) Transfer Prohibited. For a period of six (6) months following the Closing Date,
Buyer will not Transfer any of the Shares acquired under this Agreement. For purposes of this
Agreement, “Transfer” means any attempt by Buyer to take any of the following actions in connection
with the Shares:
(i) sell, offer to sell, contract or agree to sell, hypothecate, pledge, grant any option to
purchase or otherwise dispose of or agree to dispose of, directly or indirectly, or establish or
increase a put equivalent position or liquidate or decrease a call equivalent position within the
meaning of Section 16 of the Exchange Act other than a Permitted Transfer, defined herein;
(ii) enter into any swap or other arrangement that transfers to another Person, in whole or
in part, any of the economic consequences of ownership of the Shares or any securities convertible
into or exercisable for the Shares or other rights to purchase the Shares, whether any such
transaction is to be settled by delivery of the Shares or such other securities, in cash or
otherwise, other than a variable forward sale or collar or similar transaction involving a put
and/or call option settled in cash or securities; or
(iii) publicly announce an intention to effect any transaction prohibited by this Section
6.1.
(b) Attempted Transfers Void. Any attempted Transfer by Buyer of the Shares in
violation of this Agreement is void.
Section 6.2. Permitted Transfer. Notwithstanding anything herein to the contrary, the
provisions of Sections 6.1 and 6.2 shall not apply to any Transfers by the Buyer to its limited
partners (a “Permitted Transfer”); provided, however, that such limited partner, as Transferee,
shall be bound by and subject to all provisions of this Agreement as if such Shares were still held
by the Buyer.
ARTICLE VII
REGISTRATION RIGHTS.
REGISTRATION RIGHTS.
Section 7.1. Shelf Registration.
Seller shall (i) cause a shelf registration statement on Form S-3 (or other appropriate form)
covering the resale of all of the Registrable Securities to be filed with the SEC within six (6)
months after the Closing Date, (ii) cause such registration statement to be declared effective by
the SEC no later than six (6) months after the Closing Date and (iii) keep such registration
statement continuously effective until Buyer no longer holds any Registrable Securities (the “Shelf
Registration”).
Section 7.2. Underwritten Offering. Buyer will have the right to request one
Underwritten Offering of Registrable Securities under the Shelf Registration. In the event that
Buyer requests an Underwritten Offering, LodgeNet shall, subject to Buyer’s
| reasonable approval, select one or more investment banking firms of national standing to be the managing underwriter for the Underwritten Offering. Buyer agrees to enter into an underwriting agreement with the underwriters, provided that the underwriting agreement is in customary form and reasonably acceptable to Buyer. |
Section 7.3. Right to Piggyback Registration. If at any time after the Restricted
Period, LodgeNet proposes to file a registration statement under the Securities Act with respect to
an offering of LodgeNet Securities (other than a registration statement (a) on Form S-8 or any
successor form thereto, (b) on Form S-4 or any successor form thereto relating solely to the sale
of securities to employees, directors, officers, consultants or advisors of LodgeNet or its
Affiliates pursuant to a stock option, stock purchase or similar benefit plan or (c) relating to a
transaction under Rule 145 under the Securities Act), whether or not for its own account, on a form
that would permit registration of Registrable Securities for sale to the public under the
Securities Act, then LodgeNet will give written notice (the “Piggyback Notice”) of such proposed
filing to Buyer at least ten (10) days before the anticipated filing date. Such notice will include
the number and class of equity securities proposed to be registered, the proposed date of filing of
such registration statement, any proposed means of distribution of such equity securities, any
proposed managing underwriter of such equity securities, the name of the holders whose LodgeNet
securities are being registered if the registration is a secondary offering, to the extent then
known to LodgeNet, and a good faith estimate by LodgeNet of the proposed maximum offering price of
such equity securities as such price is proposed to appear on the facing page of such registration
statement, and will offer Buyer the opportunity to register such amount of Registrable Securities
as it may request on the same terms and conditions as the registration of LodgeNet’s or other
Person’s securities, as the case may be (a “Piggyback Registration”). LodgeNet will include in each
Piggyback Registration all Registrable Securities for which LodgeNet has received written requests
for inclusion within five (5) days after delivery of the Piggyback Notice, subject to Section 7.4.
Section 7.4. Priority on Piggyback Registrations.
(a) If the Piggyback Registration is an Underwritten Offering, LodgeNet will cause the
managing underwriter of that proposed offering to permit Buyer’s requested Registrable Securities
to be included in the Piggyback Registration and to include all such Registrable Securities on the
same terms and conditions as any similar LodgeNet Securities. Notwithstanding the foregoing, if the
managing underwriter of such Underwritten Offering advises LodgeNet that, in its view, the total
amount of securities that LodgeNet, Buyer and any other holders propose to include in such offering
is such as to adversely affect the success of such Underwritten Offering, then:
(i) if such Piggyback Registration is a primary registration by LodgeNet for its own account,
LodgeNet will include in such Piggyback Registration: (A) first, all securities to be offered by
LodgeNet; and (B) second, up to the full amount of securities requested to be included in such
Piggyback Registration by Buyer and all other holders having registration rights, allocated pro
rata among such holders, on the basis of the amount of securities requested to be included therein
by each such holder, so that the total amount of securities to be included in such Underwritten
Offering is the
| full amount that, in the view of such managing underwriter, can be sold without adversely affecting the success of such Underwritten Offering; and |
(ii) if such Piggyback Registration is an underwritten secondary registration for the account
of holders of securities of LodgeNet, LodgeNet will include in such registration: (A) first, all
securities of the Persons exercising “demand” registration rights requested to be included
therein; and (B) second, up to the full amount of securities requested to be included in the
registration Buyer and all other holders having registration rights, allocated pro rata among such
holders, on the basis of the amount of securities requested to be included therein by each such
holder, so that the total amount of securities to be included in such Underwritten Offering is the
full amount that, in the view of such managing underwriter, can be sold without adversely
affecting the success of such Underwritten Offering.
(b) If so requested (pursuant to a timely notice) by the managing underwriter in any
Underwritten Offering, whether or not Buyer participates in such offering, Buyer will agree not to
effect any public sale or distribution (or any other type of sale or hedging activity as the
managing underwriter reasonably determines is appropriate in order to not adversely affect the
Underwritten Offering) of any such Registrable Securities, including a sale pursuant to Rule 144
(but excluding any Registrable Securities included in such Underwritten Offering), during the ten
(10) days prior to, and during such period, not to exceed ninety (90) days, following, the closing
date of such Underwritten Offering as the managing underwriter reasonably determines is appropriate
in order to not adversely affect the Underwritten Offering. In the event of such a request,
LodgeNet may impose, during such period, appropriate stop-transfer instructions with respect to the
Registrable Securities subject to such restrictions.
Section 7.5. Withdrawal of Piggyback Registration.
(a) If at any time after giving the Piggyback Notice and prior to the effective date of the
Registration Statement filed in connection with the Piggyback Registration, LodgeNet determines for
any reason not to register or to delay the Piggyback Registration, LodgeNet may, at its election,
give notice of its determination to Buyer, and in the case of a determination not to register, will
be relieved of its obligation to register any Registrable Securities in connection with the
abandoned Piggyback Registration, without prejudice.
(b) Buyer may withdraw its request to be included in a Piggyback Registration by giving
written notice to LodgeNet of its intention to withdraw from that registration, provided, however,
that (i) Buyer’s request be made in writing, (ii) the withdrawal must be made during the time
period and on the terms determined by LodgeNet and the underwriters, if any, and (iii) the
withdrawal will be irrevocable and, after making the withdrawal, Buyer will no longer have any
right to include its Registrable Securities in that specific Piggyback Registration.
(c) An election by LodgeNet to withdraw a Piggyback Registration under this Section shall not
be deemed to be a breach of LodgeNet’s obligations with respect to such Piggyback Registration.
Section 7.6. Blackout Periods.
(a) For purposes of this Agreement, “Blackout Periods” means the periods described in this
Section 7.6(a):
(i) Notwithstanding anything contained in Sections 7.1 to 7.5 to the contrary, if the Board
determines in good faith that the registration and distribution of Registrable Securities (A)
would require premature disclosure of a matter the Board has determined would not be in the best
interest of LodgeNet to be disclosed at such time, (B) would materially adversely affect or
interfere with in any material respect any financing, acquisition, corporate reorganization or
other material transaction or development involving LodgeNet, then LodgeNet will promptly give
Buyer notice of such determination and will be entitled to postpone the preparation, filing or
effectiveness or suspend the effectiveness of a Registration Statement for a reasonable period of
time not to exceed 75 days, provided, however, that LodgeNet may extend one such postponement for
up to 105 days.
(b) Notwithstanding anything contained in this Section 7.6 to the contrary, in no event will
the number of days included in all Blackout Periods during any consecutive 12-month period exceed
an aggregate of 180 days.
Section 7.7. Registration Procedures. In connection with LodgeNet’s registration
obligations herein, LodgeNet will use its reasonable efforts to effect such registrations to permit
the sale of Registrable Securities by Buyer in accordance with the intended method or methods of
disposition thereof, and pursuant thereto LodgeNet will as promptly as reasonably practicable:
(a) prepare and file with the SEC a Registration Statement on an appropriate form under the
Securities Act available for the sale of the Registrable Securities by Buyer in accordance with the
intended method or methods of distribution thereof;
(b) furnish, at its expense, to Buyer such number of conformed copies of the Registration
Statement and each amendment thereto, of the Prospectus and each supplemental thereto, and of such
other documents as Buyer reasonably may request from time to time;
(c) prepare and file with the SEC any amendments and post-effective amendments to the
Registration Statement as may be necessary and any supplements to the Prospectus as may be required
or appropriate, in the view of LodgeNet and its counsel, by the rules, regulations or instructions
applicable to the registration form used by LodgeNet or by the Securities Act to keep the
Registration Statement effective until such time as all Registrable Securities covered by the
Registration Statement are sold in
| accordance with the intended plan of distribution set forth in the Registration Statement or supplement to the Prospectus; |
(d) promptly following its actual knowledge thereof, notify Buyer and the managing
underwriter, if any:
(i) when a Registration Statement, Prospectus, Issuer Free Writing Prospectus or any
supplement or amendment has been filed and, with respect to a Registration Statement or any
post-effective amendment, when the same has become effective;
(ii) of any request by the SEC or any other governmental authority for amendments or
supplements to a Registration Statement, Prospectus or Issuer Free Writing Prospectus or for
additional information;
(iii) of the issuance by the SEC or any other governmental authority of any stop order
suspending the effectiveness of a Registration Statement or the initiation of any proceedings for
that purpose;
(iv) of the receipt by LodgeNet of any written notification with respect to the suspension of
the qualification or exemption from qualification of any of the Registrable Securities for sale in
any jurisdiction or the initiation or threatening of any proceeding for such purpose;
(v) of the occurrence of any event which makes any statement made in the Registration
Statement or Prospectus or any Issuer Free Writing Prospectus untrue in any material respect or
which requires the making of any changes in a Registration Statement, Prospectus, Issuer Free
Writing Prospectus or other documents so that it will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein or necessary to
make the statements therein not misleading; and
(vi) of LodgeNet’s reasonable determination that a post-effective amendment to a Registration
Statement is necessary;
(e) use its reasonable efforts to prevent the issuance or obtain the withdrawal of any order
suspending the effectiveness of a Registration Statement, or the lifting of any suspension of the
qualification or exemption from qualification of any of the Registrable Securities for sale in any
jurisdiction, at the earliest practicable date;
(f) prior to any public offering of Registrable Securities, register or qualify and cooperate
with Buyer, the managing underwriter, if any, and their respective counsel in connection with the
registration or qualification (or exemption from such registration or qualification) of such
Registrable Securities for offer and sale under the securities or blue sky laws of such
jurisdictions within the United States as Buyer or the managing underwriter reasonably requests in
writing and maintain each registration or qualification (or exemption therefrom) effective during
the period such Registration Statement is required to be kept effective; provided, however, that
LodgeNet will not be
| required to qualify generally to do business in any jurisdiction in which it is not then so qualified or take any action which would subject it to general service of process or material taxation in any jurisdiction in which it is not then so subject; |
(g) as promptly as practicable upon the occurrence of any event contemplated by Sections
7.7(d)(v) or 7.7(d)(vi) hereof, prepare (and furnish, at its expense, to Buyer a reasonable number
of copies of) a supplement or post-effective amendment to each Registration Statement or a
supplement to the related Prospectus (including by means of an Issuer Free Writing Prospectus), or
file any other required document so that, as thereafter delivered to the purchasers of the
Registrable Securities being sold thereunder, such Prospectus or Issuer Free Writing Prospectus
will not contain an untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein not misleading;
(h) in the case of an Underwritten Offering, enter into customary agreements (including an
underwriting agreement) and take other actions reasonably necessary to expedite the disposition of
the Registrable Securities, and in connection therewith:
(i) obtain opinions of counsel to LodgeNet and updates thereof covering matters customarily
covered in opinions of counsel requested in Underwritten Offerings, addressed to Buyer and the
managing underwriter;
(ii) obtain “comfort” letters and updates thereof from the independent certified public
accountants of LodgeNet addressed to Buyer and the managing underwriter, if any, covering matters
customarily covered in “comfort” letters in connection with Underwritten Offerings;
(iii) provide officers’ certificates and other customary closing documents reasonably
requested by the managing underwriter;
(iv) if requested by the managing underwriter or underwriters or counsel to Buyer, promptly
incorporate in a prospectus supplement or post effective amendment such information as such
managing underwriter or underwriters or counsel reasonably requests to be included therein, and
which is reasonably related to the offering of such Registrable Securities, including, without
limitation, with respect to the Registrable Securities being sold to such underwriter or
underwriters, the purchase price being paid therefor by such underwriter or underwriters and any
other terms of an underwritten offering of the Registrable Securities to be sold in such offering,
and LodgeNet shall promptly make all required filings of such prospectus supplement or post
effective amendment; and
(v) cooperate with Buyer and each underwriter and their respective counsel in connection with
any filings required to be made with the National Association of Securities Dealers, Inc.
(“NASD”), including, if appropriate, the pre-filing of a prospectus as part of a Registration
Statement in advance of an Underwritten Offering.
(i) upon reasonable notice and at reasonable times during normal business hours, make
available for inspection by a representative of Buyer and the managing underwriter, if any,
participating in any disposition of Registrable Securities and any attorney or accountant retained
by Buyer or any underwriter, all financial and other records, pertinent corporate documents and
properties of LodgeNet that are reasonably necessary for a due diligence investigation by an
underwriter or a selling stockholder, as applicable, in LodgeNet’s sole reasonable discretion, and
cause the officers, directors and employees of LodgeNet to supply all information reasonably
requested by any such representative, underwriter, attorney or accountant in connection with the
Registration Statement;
(j) use its reasonable efforts to comply with all applicable rules and regulations of the SEC
relating to such registration and make generally available to its security holders earning
statements satisfying the provisions of Section 11(a) of the Securities Act, provided that LodgeNet
will be deemed to have complied with this Section 7.7(j) if it has satisfied the provisions of Rule
158 under the Securities Act (or any similar rule promulgated under the Securities Act); and
(k) use its reasonable efforts to procure the cooperation of LodgeNet’s transfer agent in
settling any offering or sale of Registrable Securities;
(l) cause all such Registrable Securities to be listed on each securities exchange or
automated quotation system on which similar securities issued by LodgeNet are then listed.
Section 7.8. Information from Buyer.
(a) Upon requested inclusion of its Registrable Securities in any Registration Statement,
Buyer shall furnish to LodgeNet such information regarding Buyer and its plan and method of
distribution of such Registrable Securities as LodgeNet may, from time to time, reasonably request.
LodgeNet may refuse to proceed with the registration of Buyer’s Registrable Securities if Buyer
unreasonably fails to furnish such information within a reasonable time after receiving such
request.
(b) Buyer will promptly (i) following its actual knowledge thereof, notify LodgeNet of the
occurrence of any event that makes any statement made in a Registration Statement, Prospectus,
Issuer Free Writing Prospectus or other Free Writing Prospectus regarding Buyer untrue in any
material respect or that requires the making of any changes in a Registration Statement, Prospectus
or Free Writing Prospectus so that, in such regard, it will not, with respect to Buyer, contain any
untrue statement of a material fact or omit any material fact required to be stated therein or
necessary to make the statements not misleading and (ii) provide LodgeNet with such information
regarding Buyer as may be required to enable LodgeNet to prepare a supplement or post-effective
amendment to any such Registration Statement or a supplement to such Prospectus or Free Writing
Prospectus.
(c) With respect to any Registration Statement for an Underwritten Offering, the inclusion of
Buyer’s Registrable Securities therein will be conditioned, at the managing underwriter’s request,
upon the execution and delivery by Buyer of an underwriting agreement in form, scope and substance
as is customary in Underwritten Offerings.
Section 7.9. Suspension of Disposition.
(a) Upon receipt of any notice from LodgeNet of the occurrence of any event of the type
described in Sections 7.7(d)(ii), 7.7(d)(iii), 7.7(d)(iv), 7.7(d)(v) or 7.7(d)(vi), Buyer will
discontinue disposition of Registrable Securities covered by a Registration Statement, Prospectus
or Free Writing Prospectus and suspend use of such Prospectus or Free Writing Prospectus until
Buyer’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section
7.7(g) or until it is advised by LodgeNet that the use of the applicable Prospectus or Free Writing
Prospectus may be resumed and have received copies of any additional or supplemental filings that
are incorporated or deemed to be incorporated by reference in such Prospectus or Free Writing
Prospectus. In the event LodgeNet shall give any such notice, LodgeNet will use reasonable best
efforts to promptly amend or supplement the Prospectus or Issuer Free Writing Prospectus or take
such other action as is necessary in order to provide to Buyer as promptly as practicable (i) the
copies of the supplemented or amended Prospectus or Issuer Free Writing Prospectus contemplated by
Section 7.7(g) or (ii) the advice referenced in this Section 7.9(a).
(b) Upon receipt of any notice from LodgeNet of the happening of an event specified in Section
7.6(a)(i), Buyer will discontinue disposition of Registrable Securities covered by a Registration
Statement, Prospectus or Free Writing Prospectus and suspend use of such Prospectus or Free Writing
Prospectus until the earlier to occur of Buyer’s receipt of (i) copies of a supplemented or amended
Prospectus or Issuer Free Writing Prospectus describing the event giving rise to the aforementioned
suspension and (ii) (A) notice from LodgeNet that the use of the applicable Prospectus or Issuer
Free Writing Prospectus may be resumed and (B) copies of any additional or supplemental filings
that are incorporated or deemed to be incorporated by reference in such Prospectus or Issuer Free
Writing Prospectus. In the event LodgeNet shall give any such notice, LodgeNet will use reasonable
best efforts to promptly amend or supplement the Prospectus or Issuer Free Writing Prospectus or
take such other action as is necessary in order to provide to Buyer as promptly practicable (i) a
supplemented or amended Prospectus or Issuer Free Writing Prospectus describing the event giving
rise to the aforementioned suspension or (ii) notice that use of the applicable Prospectus or
Issuer Free Writing Prospectus may resume
Section 7.10. Registration Expenses.
(a) All fees and expenses incurred by LodgeNet in complying with Sections 7.1 to 7.5 and
Section 7.7 (“Registration Expenses”) will be borne by LodgeNet. These fees and expenses will
include without limitation (i) all registration, filing and qualification fees, (ii) printing,
duplicating and delivery expenses, (iii) fees and
| disbursements of counsel for LodgeNet, (iv) fees and expenses of complying with state securities or “blue sky” laws (including the fees and expenses of any local counsel in connection therewith), and (v) fees and disbursements of all independent certified public accountants referred to in Section 7.7(h)(ii) (including the expenses of any special audit and “comfort” letters required by or incident to such performance). |
(b) Notwithstanding anything contained herein to the contrary, all underwriting fees,
discounts, selling commissions and stock transfer taxes applicable to the sale of Registrable
Securities will be borne by Buyer.
Section 7.11. Indemnification.
(a) LodgeNet will indemnify and hold harmless Buyer, its Affiliates, officers, directors,
managers, partners, stockholders, employees, advisors, agents and other representatives, and each
Person who controls Buyer (within the meaning of Section 15 of the Securities Act or Section 20 of
the Exchange Act) from and against all losses, claims, damages, liabilities, costs (including
without limitation reasonable attorneys’ fees and disbursements) and expenses (collectively,
“Losses”) arising out of or based upon any untrue or alleged untrue statement of a material fact
contained or incorporated by reference in any Registration Statement, Prospectus or preliminary
prospectus or Issuer Free Writing Prospectus, or arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as the same are based solely upon
information furnished in writing to LodgeNet by or on behalf of Buyer expressly for use therein;
provided, however, that LodgeNet will not be liable to the extent that any Losses arise out of or
are based upon an untrue statement or alleged untrue statement or omission or alleged omission made
in any preliminary prospectus if either (a) such untrue statement or alleged untrue statement or
such omission or alleged omission was corrected in a Prospectus or Issuer Free Writing Prospectus
provided to Buyer prior to the confirmation of the sale of Registrable Securities to the Person
asserting the claim from which such Losses arose, and Buyer thereafter failed to send or deliver a
copy of the Prospectus or Issuer Free Writing Prospectus with or prior to the delivery of written
confirmation of such sale in any case in which such delivery is required under the Securities Act
or (b) such untrue statement or alleged untrue statement or omission or alleged omission was
corrected in an amendment or supplement to the Prospectus or Issuer Free Writing Prospectus
previously furnished by or on behalf of LodgeNet and such Prospectus or Issuer Free Writing
Prospectus as so amended or supplemented was provided to Buyer prior to the confirmation of the
sale of Registrable Securities to the Person asserting the claim from such Losses arose, and Buyer
thereafter failed to send or deliver such Prospectus or Issuer Free Writing Prospectus as so
amended or supplemented with or prior to the delivery of written confirmation of such sale in any
case in which such delivery is required under the Securities Act.
(b) In the event of the filing of any registration statement relating to the registration of
any Registrable Securities, Buyer will indemnify and hold harmless LodgeNet, its Affiliates,
officers, directors, managers, partners, stockholders, employers, advisors, agents and other
representatives, and each Person who controls LodgeNet
| (within the meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act) from and against all Losses arising out of or based upon any untrue or alleged untrue statement of a material fact contained or incorporated by reference in any Registration Statement, Prospectus or preliminary prospectus or Issuer Free Writing Prospectus, or arising out of or based upon any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, to the extent, and only to the extent, that such untrue statement or alleged untrue statement or omission or alleged omission was made in reliance upon and in conformity with information so furnished in writing by or on behalf of Buyer to LodgeNet expressly for use in such Registration Statement, Prospectus or preliminary prospectus or Issuer Free Writing Prospectus. The liability of Buyer for indemnification under this Section 7.11 in its capacity as a seller of Registrable Securities under any registration Statement shall not exceed the amount equal to the net proceeds to Buyer of the Registrable Securities sold under such Registration Statement. |
Section 7.12. Contribution. If the indemnification provided for in Section 7.11 is
held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to
any losses, claims, damages or liabilities referred to herein, the indemnifying party, in lieu of
indemnifying such indemnified party thereunder, shall to the extent permitted by applicable law
contribute to the amount paid or payable by such indemnified party as a result of such loss, claim,
damage or liability in such proportion as is appropriate to reflect the relative fault of the
indemnifying party on the one hand and of the indemnified party on the other in connection with the
untrue statement or omission that resulted in such loss, claim, damage or liability, as well as any
other relevant equitable considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by a court of law by reference to, among other things,
whether the untrue or alleged untrue statement of a material fact or the omission to state a
material fact relates to information supplied by the indemnifying party or by the indemnified party
and the parties’ relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission; provided, that in no event shall any contribution by Buyer
hereunder exceed the net proceeds to Buyer from the sale of Registrable Securities. The
obligations of the parties under Section 7.11 and this Section 7.12 shall survive completion of any
offering of Registrable Securities and any termination of this Agreement..
Section 7.13. Rule 144. To the extent the following make available the benefits of
certain rules and regulations of the SEC which may permit the sale of registered securities to the
public without registration or pursuant to a registration on Form X-0, XxxxxXxx agrees to (a) make
and keep public information available as those terms are understood and defined in Rule 144; (b)
use its reasonable efforts to file with the SEC in a timely manner all reports and other documents
required of LodgeNet under the Securities Act and the Exchange Act; (c) to the extent not available
on XXXXX, furnish to Buyer promptly upon written request a written statement by LodgeNet as to its
compliance with the reporting requirements of Rule 144 and of the Securities Act and the Exchange
Act, a copy of the most recent annual or quarterly report of LodgeNet and such other reports and
documents as Buyer reasonably may request in availing itself of any rule or regulation of the SEC
allowing Buyer to sell any Registrable Securities without
| registration; and (d) take such other actions as may be reasonably required by LodgeNet’s transfer agent to consummate any sale of Registrable Securities in accordance with the terms and conditions of Rule 144. |
Section 7.14. Participation in Underwritten Offerings. Notwithstanding anything
contained herein to the contrary, Buyer may not participate in any Underwritten Offering pursuant
to a registration hereunder unless Buyer (a) agrees to sell its securities on the basis provided in
any underwriting arrangements approved by the Persons entitled hereunder to approve such
arrangements and (b) completes and executes all questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents reasonably required under the terms of such
underwriting arrangements all of which shall be in customary form and reasonably acceptable to
Buyer.
Section 7.15. Legend. LodgeNet shall cause a legend substantially similar to the
following effect to be placed on each certificate representing any Shares:
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“ACT”), OR APPLICABLE STATE SECURITIES LAWS AND THESE SECURITIES
MAY NOT BE SOLD OR TRANSFERRED UNLESS (I) A REGISTRATION STATEMENT
COVERING SUCH SALE AND TRANSFER IS EFFECTIVE UNDER THE ACT OR (II) THE
TRANSACTION IS EXEMPT FROM REGISTRATION UNDER THE ACT, AND IF THE ISSUER
REQUESTS, AN OPINION SATISFACTORY TO THE ISSUER TO SUCH EFFECT HAS BEEN
RENDERED BY COUNSEL.
THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A
CONTRACTUAL LOCK-UP PERIOD PURSUANT TO THAT CERTAIN STOCK PURCHASE
AGREEMENT BETWEEN THE ISSUER AND PAR INVESTMENT PARTNERS, L.P., IN
ACCORDANCE WITH AND SUBJECT TO SUCH LOCK-UP PERIOD, SUCH SECURITIES MAY
NOT BE SOLD, TRANSFERRED, PLEDGED, DISPOSED OF, ENCUMBERED OR ASSIGNED AND
THE ISSUER SHALL NOT BE REQUIRED TO GIVE EFFECT TO ANY ATTEMPTED SALE,
TRANSFER, PLEDGE, DISPOSAL, ENCUMBRANCE OR ASSIGNMENT. UPON THE WRITTEN
REQUEST OF THE HOLDER OF THIS CERTIFICATE, THE ISSUER AGREES TO REMOVE
THIS RESTRICTIVE LEGEND (AND ANY STOP ORDER PLACED WITH ITS TRANSFER
AGENT) WITH RESPECT TO SUCH SECURITIES THAT ARE NO LONGER BOUND BY THE
STOCK PURCHASE AGREEMENT.
If any Shares become eligible for sale pursuant to Rule 144(k) or otherwise cease to be
restricted securities, Seller shall, upon the request of the holder of such Shares, promptly remove
the first legend set forth above from the certificates for such Shares. At any time following the
date that is six months after the Closing Date, Seller shall, upon the request of Buyer, promptly
remove the second legend set forth above from any certificates representing Shares.
Section 7.16. Remedies. Each of the Parties acknowledges and agrees that in the event
of any breach of this Agreement, the nonbreaching Party would be irreparably harmed and could not
be made whole by monetary damages. Accordingly, the Parties to this Agreement, in addition to any
other remedy to which they may be entitled hereunder or at law or in equity, shall be entitled to
compel specific performance of this Agreement.
Section 7.17. Confidentiality. Buyer will, and will cause its officers, directors,
employees, legal counsel, accountants, financial advisors and other representatives to, hold in
confidence any material nonpublic information received by it pursuant to this Agreement, including
without limitation any material nonpublic information included in any Registration Statement or
Prospectus proposed to be filed with the SEC (until such Registration Statement or Prospectus has
been filed). This Section 7.17 shall not apply to any information which (a) is or becomes generally
available to the public, (b) was already in Buyer’s possession from a non-confidential source prior
to its disclosure by LodgeNet, (c) is or becomes available to Buyer on a non-confidential basis
from a source other than LodgeNet, provided that such source is not known by Buyer to be bound by
confidentiality obligations or (d) is required to be disclosed by law.
ARTICLE VIII
TERMINATION
TERMINATION
Section 8.1. Termination of Agreement.
This Agreement may be terminated at any time prior to the Closing as follows:
(a) Buyer and Seller may terminate this Agreement by mutual written consent;
(b) Buyer may terminate this Agreement upon written notice within five (5) Business Days of
being informed by Seller that Seller has entered into a definitive agreement for a transaction
(other than the Acquisition) with a purchase price in excess of $100,000,000 or that Seller intends
to do so.
(c) Buyer may terminate this Agreement upon written notice within five (5) Business Days of
being informed by Seller that Seller has made a material change to the economic terms or such
similar business terms of the Acquisition or that Seller intends to do so.
(d) Buyer or Seller may terminate this Agreement upon written notice to the other at any time
after the termination of the Liberty SPA.
(e) Buyer may terminate this Agreement by giving written notice to Seller (i) if Seller has
breached any representation, warranty, or covenant contained in this Agreement in any material
respect and such breach has not been cured by Seller within 30 days after written notice of such
breach is delivered by Buyer to Seller, or (ii) if any of the conditions in Section 5.1 has not
been satisfied or if satisfaction of such a condition is or becomes impossible (other than as a
result of the failure of Buyer to comply with its obligations under this Agreement) and Buyer has
not waived such condition on or before such date; or
(f) Seller may terminate this Agreement by giving written notice to Buyer (i) if Buyer has
breached any representation, warranty, or covenant contained in this Agreement in any material
respect and such breach has not been cured by Buyer within 30 days after written notice of such
breach is delivered by Seller to Buyer, or (ii) if any of the conditions in Section 5.2 has not
been satisfied or if satisfaction of such a condition is or becomes impossible (other than in whole
or in part as a result of the failure of Seller to comply with its obligations under this
Agreement) and Seller has not waived such condition on or before such date.
Section 8.2. Effect of Termination.
(a) Buyer’s and Seller’s right of termination under Section 8.1 is in addition to any other
rights or remedies it may have under this Agreement or otherwise, and the exercise of a right of
termination will not be deemed an election of remedies. If this Agreement is terminated pursuant
to Section 8.1, all further obligations of the Parties under this Agreement automatically will
terminate; provided, however, that if this Agreement is terminated by a Party because of the breach
of this Agreement by the other Party or because one or more of the conditions to the terminating
Party’s obligations under this Agreement is not satisfied as a result of the other Party’s failure
to comply with its obligations under this Agreement, the terminating Party’s right to pursue all
legal and equitable remedies for such breach will survive such termination unimpaired.
ARTICLE IX
MISCELLANEOUS
MISCELLANEOUS
Section 9.1. Public Announcements. Prior to the Closing, except as required by federal
securities laws or by obligations pursuant to any listing agreement with or requirement of any
national securities exchange or national quotation system on which the common stock of LodgeNet is
listed, admitted to trading or quoted, LodgeNet shall not, without the prior written consent of the
Buyer, make any public announcement, press release or similar publicity with respect to this
Agreement or the transactions contemplated by this Agreement.
Section 9.2 No Third-Party Beneficiaries. This Agreement shall not confer any rights
or remedies upon any Person other than the Parties and their respective successors and permitted
assigns.
Section 9.3. Successors and Assigns. This Agreement will be binding upon and inure to
the benefit of the Parties and their respective successors and permitted assigns. No Party may
assign either this Agreement or any of its rights, interests, or obligations hereunder without the
prior written approval of the other Parties, provided that the Buyer may without the prior written
consent of Seller, assign this Agreement or any of its rights, interests or obligations to an
Affiliate of Buyer or to the limited partners of Buyer and provided further that Buyer may make a
collateral assignment of its rights, but not its obligations, under this Agreement to any of its
financing sources. In the event of any Transfer of any Shares to the limited partners of Buyer as
permitted by Section 6.3 and without the need for an express assignment, such Shares shall be held
subject to all of the terms of this Agreement, and by taking and holding such Shares such persons
shall be deemed to have agreed to be bound by and to perform all of the terms and provisions of
this Agreement and such persons shall be entitled to receive the benefits hereof.
Section 9.4. Entire Agreement. This Agreement (including the Exhibits and Schedules
hereto and any other agreements and documents referred to in this Agreement) constitutes the entire
agreement between the Parties and supersedes any prior understandings, agreements, or
representations by or between the Parties, written or oral, to the extent they are related in any
way to the subject matter hereof
Section 9.5. Notices. All notices, consents, waivers, and other communications under
this Agreement must be in writing and will be deemed to have been duly given when (a) delivered by
hand (with written confirmation of receipt), (b) sent by facsimile (with written confirmation of
receipt), or (c) when received by the addressee, if sent by a nationally recognized overnight
delivery service (receipt requested), in each case to the appropriate addresses and facsimile
numbers set forth below (or to such other addresses and telecopier numbers as a Party may designate
by notice to the other Parties, provided that any such change shall be effective only upon receipt
by the other Parties):
If to Buyer: PAR Investment Partners, L.P.
c/o PAR Capital Management, Inc.
Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx XxXxxxx
Facsimile: 000-000-0000
c/o PAR Capital Management, Inc.
Xxx Xxxxxxxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxx XxXxxxx
Facsimile: 000-000-0000
If to Seller: LodgeNet Entertainment Corporation
0000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx and Xxxxx X. Xxxx
Facsimile: 000-000-0000
0000 Xxxx Xxxxxxxxxx Xxxxxx
Xxxxx Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx and Xxxxx X. Xxxx
Facsimile: 000-000-0000
Section 9.6. Governing Law; Jurisdiction; Remedies. This Agreement will be governed
by and construed in accordance with the laws of the State of Delaware without giving effect to any
choice or conflict of law provision or rule (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the laws of any jurisdiction other than the State
of Delaware. Any Proceeding seeking to enforce any provision of, or based on any matter arising
out of or in connection with, this Agreement or the transactions contemplated by this Agreement may
be brought by or against any Party in any court of competent jurisdiction located in the State of
Delaware. Each Party irrevocably and unconditionally agrees to be subject to the jurisdiction of
the courts of the State of Delaware and of the federal courts sitting in the State of Delaware and
not to object to the jurisdiction of such courts on the basis of inconvenience of forum or
otherwise. Without limiting the generality of the foregoing, each Party agrees that service of
process upon such Party at such Party’s address as set forth in Section 9.4, together with written
notice of such service to such Party, will be deemed effective service of process upon such Party.
If a Party breaches or threatens to breach this Agreement, the non-breaching Party may, in addition
to all other remedies available to it, seek equitable remedies, including the remedies of
injunction and specific performance, without the need to post any bond or other security.
Section 9.7. Amendments and Waivers. No amendment of any provision of this Agreement
will be valid unless the same is in writing and signed by Buyer and Seller. No waiver by any Party
of any default, misrepresentation, or breach of warranty or covenant under this Agreement, whether
intentional or not, will be deemed to extend to any prior or subsequent default, misrepresentation,
or breach of warranty or covenant under this Agreement or affect in any way any rights arising by
virtue of any prior or subsequent such occurrence.
Section 9.8. Severability. Any term or provision of this Agreement that is invalid or
unenforceable in any situation in any jurisdiction will not affect the validity or enforceability
of the remaining terms and provisions of this Agreement or the validity or enforceability of the
offending term or provision in any other situation or in any other jurisdiction.
Section 9.9. Expenses. Except as otherwise expressly provided in this Agreement, each
of Seller and Buyer will bear its own costs and expenses (including legal fees and expenses)
incurred in connection with this Agreement and the transactions contemplated by this Agreement.
Section 9.10. Construction. The Parties have participated jointly in the negotiation
and drafting of this Agreement. If an ambiguity or question of intent or interpretation arises,
this Agreement will be construed as if drafted jointly by the Parties and no presumption or burden
of proof will arise favoring or disfavoring any Party by virtue of the authorship of any of the
provisions of this Agreement.
Section 9.11. Incorporation of Exhibits and Schedules. The Exhibits and Schedules
identified in this Agreement are incorporated herein by reference and made a part hereof.
Section 9.12. Headings. The Article and Section headings contained in this Agreement
are inserted for convenience only and will not affect in any way the meaning or interpretation of
this Agreement.
Section 9.13. Facsimile; Counterparts Signatures. This Agreement may be executed by
facsimile signature and in one or more counterparts, each of which will be deemed an original but
all of which together will constitute one and the same instrument.
[Remainder of Page Intentionally Left Blank]
IN WITNESS WHEREOF, the Parties have executed this Stock Purchase Agreement as of the date
first written above.
| SELLER: | ||||
| LODGENET ENTERTAINMENT CORPORATION |
||||
| By: Name: Xxxxx X. Xxxxxxxx Title: President and Chief Executive Officer |
||||
| BUYER: | ||||
| PAR INVESTMENT PARTNERS, L.P. | ||||
| By: | PAR Group, L.P. | |||
| its general partner | ||||
| By: | PAR Capital Management, Inc. | |||
| its general partner | ||||
| By: | ||||
| Name: Title: |
Xxxxxx X. Xxxxxxx Vice President |
|||
[Signature Page to Stock Purchase Agreement]
