Exhibit 5
EXCHANGE AGREEMENT
AGREEMENT, dated as of March 28, 2001, by and among Cendant
Membership Services Holdings, Inc., a Delaware corporation ("Buyer"), Xxxxxx X.
Xxxxx ("Preis"), and Xxxx X. XxXxxxx ("McWeeny" and together with Preis, the
"Sellers").
WHEREAS, Preis is the owner of 81,761 shares ("the Preis
Shares") of Cendant Corporation common stock designated as Xxxx.xxx
Tracking Stock, par value $0.01 per share ("Xxxx.xxx Stock"), and McWeeny
is the owner of 15,751 shares of Xxxx.xxx Stock (the "McWeeny Shares" and
together with the Preis Shares, the "Tracking Stock Shares");
WHEREAS, Buyer is a party to an Agreement and Plan of
Reorganization, dated as of October 26, 2000, by and among Xxxxxxxxx.xxx,
Inc., ("Homestore"), Metal Acquisition Corp., WW Acquisition Corp.,
Xxxx.xxx, Inc. ("Xxxx.xxx"), Welcome Wagon International Inc., Buyer and
Cendant Corporation, a Delaware corporation ("Parent"), pursuant to which
each outstanding share of common stock of Xxxx.xxx, par value $.01 per
share, was converted into the right to receive .7284 shares (the "Exchange
Ratio") of common stock of Xxxxxxxxx.xxx, Inc., par value $0.001 per share
("Homestore Common Stock"); and
WHEREAS, the parties desire to exchange Tracking Stock
Shares for shares of Homestore Common Stock at the Exchange Ratio
(substituting Tracking Stock Shares for shares of common stock of Xxxx.xxx
in the calculation), on the terms and conditions provided for herein.
NOW, THEREFORE, in consideration of the provisions
contained herein, the parties hereto agree as follows:
1. EXCHANGE OF TRACKING STOCK SHARES FOR
HOMESTORE SHARES.
1.1 Exchange of Shares. On the terms and subject to the
conditions contained herein, Buyer agrees to exchange with the Sellers and
the Sellers agree to exchange with Buyer (i) 59,555 shares of Homestore
Common Stock (the "Preis Homestore Shares") in exchange for the Preis
Shares, and (ii) 11,473 shares of Homestore Common Stock (the "McWeeny
Homestore Shares" and, together with the Preis Homestore Shares, the
"Homestore Shares") in exchange for the McWeeny Shares. Pursuant to a
Registration Rights Agreement, dated as of October 26, 2000 and effective
as of February 16, 2000, by and between Homestore and Parent (the
"Registration Rights Agreement"), Homestore is required to file a
registration statement on Form S-3 no later than May 17, 2001 for a public
offering of the Homestore Shares (the "Shelf Registration").
1.2 Delivery of Shares. (a) At the Closing each of the
Sellers shall deliver to Buyer validly issued certificates representing the
Tracking Stock Shares duly endorsed in blank or accompanied by stock powers
duly executed in blank, with all necessary stock transfer stamps affixed.
(b) At the Closing Buyer shall (i) deliver to Preis a
validly issued certificate representing the Preis Homestore Shares duly
endorsed in blank or accompanied by stock powers duly executed in blank,
with all necessary stock transfer stamps affixed and (ii) deliver to
McWeeny a validly issued certificate representing the McWeeny Homestore
Shares duly endorsed in blank or accompanied by stock powers duly executed
in blank, with all necessary stock transfer stamps affixed.
2. THE CLOSING. Upon the terms and subject to the
conditions of this Agreement, it is intended that the closing of the
transactions contemplated by this Agreement (the "Closing") shall take
place on the date of execution of this Agreement at the offices of Skadden,
Arps, Slate, Xxxxxxx & Xxxx LLP, Xxxx Xxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, at 10:00 a.m. (local time); provided, however, if any of the
conditions set forth in this Agreement shall not have been satisfied or
waived as of the date of this Agreement, then the Closing shall take place
on the third business day after satisfaction of all the conditions provided
for in Section 5 hereof, or at such other place and time as the parties
hereto shall agree in writing (the time and date of such closing being
referred to herein as the "Closing Date"). The parties hereto agree to use
their best efforts to have the Closing occur as soon as practicable
consistent with the provisions of this Agreement.
3. REPRESENTATIONS AND WARRANTIES OF THE SELLERS.
Each of the Sellers jointly and severally represent and warrant to Buyer as
follows:
3.1 Authorization. Each Seller has full power and
authority to enter into and to perform its obligation under this Agreement
in accordance with its terms.
3.2 Binding Agreement. This Agreement has been duly and
validly executed and delivered on behalf of each Seller and, assuming due
authorization, execution and delivery by Buyer, constitutes the legal and
binding obligation of each of the Sellers enforceable against the Sellers
in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and other
similar laws relating to or affecting creditors' rights generally, and to
general equity principles (whether considered in a proceeding in equity or
at law).
3.3 Required Approvals, Notices and Consents. Except as
described herein or in Schedule 3.3 hereof, no consent or approval of,
other action by, or any notice to, any governmental body or agency,
domestic or foreign, or any third party is required in connection with the
execution and delivery by each of the Sellers of this Agreement or the
consummation by each of the Sellers of the transaction contemplated hereby.
3.4 Restricted Securities. Until the Shelf Registration
is declared effective by the Securities and Exchange Commission pursuant to
the Registration Rights Agreement (which may or may not occur by May 17,
2001), each Seller understands that (a) the Homestore Shares to be received
by such Seller hereunder are characterized as "restricted securities" under
the federal securities laws inasmuch as such securities are being acquired
from Buyer in a transaction not involving a public offering and that under
such laws and applicable regulations such securities may be resold without
registration under the Securities Act only in certain limited circumstances
and (b) the certificate(s) representing the Homestore Shares shall bear the
following legends:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE
SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE SOLD OR
TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR A WRITTEN
OPINION OF COUNSEL, REASONABLY ACCEPTABLE TO THE ISSUER IN FORM
AND SUBSTANCE, THAT SUCH TRANSFER IS EXEMPT FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT OF 1933.
The Sellers must request that Homestore remove the legend
set forth above from the certificates evidencing the Homestore Shares or
issue to such holder new certificates therefor free of such legend in
connection with the Shelf Registration.
3.5 Suitability Standards.
(a) Each Seller is acquiring the Homestore Shares
for investment purposes only and solely for his
own accounts and not with a view to, or for
resale in connection with, the distribution or
disposition thereof, except for such
distributions or dispositions which are effected
in compliance with the Securities Act;
(b) Each Seller understand that the Homestore Shares
have not been registered under the Securities
Act or under any state securities or "blue sky"
laws;
(c) Each Seller will not directly or indirectly
offer, sell, transfer, assign, pledge,
hypothecate or otherwise dispose of, or solicit
any offers to purchase or otherwise acquire or
take a pledge of, any of the Homestore Shares,
except in accordance with the Securities Act and
all applicable state securities or "blue sky"
laws;
(d) The financial situation of each Seller is such
that he can afford to bear the economic risk of
holding the Homestore Shares for an indefinite
period of time and suffer complete loss of his
investment in the Homestore Shares;
(e) Each Seller has such knowledge and experience in
financial and business matters that he is
capable of evaluating the merits and risks
relating to his investment in the Homestore
Shares;
(f) Each Seller acknowledge that the Homestore
Shares must be held indefinitely and each Seller
must continue to bear the economic risk of his
investments in the Homestore Shares until the
Homestore Shares are subsequently registered
under the Securities Act or an exemption from
such registration is available;
(g) Each Seller understands that the Homestore
Shares represent a speculative investment which
involves a high degree of risk of loss of his
investment therein;
(h) In making his decision to receive the Homestore
Shares under this Agreement, each Seller has
relied upon independent investigations made by
his and, to the extent believed by him to be
appropriate, his representatives, including his
own professional, tax and other advisors;
(i) In making his decision to receive the Homestore
Shares under this Agreement, each Seller has not
received or relied upon any information relating
the Homestore from Buyer and each Seller has
relied solely upon the public filings of
Homestore to evaluate the risks associated with
ownership of the Homestore Shares; and
(j) All information that each Seller has provided to
Buyer concerning himself and his financial
position and the financial position of Preis'
spouse is true, complete and correct as of the
date of this Agreement.
3.6 Fees and Commissions. No agent, broker, investment
banker, person or firm acting on behalf of or under the authority of either
Seller is or will be entitled to any broker's or finder's fee or any other
commission directly or indirectly in connection with the transactions
contemplated herein. Each Seller agrees to indemnify and hold harmless
Buyer from liability for any compensation to any intermediary retained or
otherwise authorized to act by, or on behalf of, such Seller and the fees
and expenses of defending against such liability or alleged liability.
3.7 Transfer Instructions. Each Seller agrees that
Homestore may provide for appropriate transfer instructions to implement
the provisions of Section 3.4 hereof.
4. REPRESENTATIONS AND WARRANTIES OF BUYER. Buyer
represents and warrants to each of the Sellers as follows:
4.1 Organization and Standing. Buyer is a corporation
duly incorporated, validly existing and in good standing under the laws of
the jurisdiction of its incorporation.
4.2 Binding Agreement. Buyer has all requisite corporate
power and authority to enter into, execute and deliver this Agreement, to
carry out its obligations hereunder and to consummate the transaction
contemplated hereby. This Agreement has been duly and validly authorized,
executed and delivered by Buyer and, assuming due authorization, execution
and delivery by each of the Sellers, constitutes the legal and binding
obligation of Buyer enforceable against Buyer in accordance with its terms,
subject to the effects of bankruptcy, insolvency, fraudulent conveyance,
reorganization, moratorium and other laws relating to or affecting
creditors' rights generally, and to general equity principles (whether
considered in a proceeding in equity or at law).
4.3 Fees and Commissions. No agent, broker, investment
banker, person or firm acting on behalf of or under the authority of Buyer
is or will be entitled to any broker's or finder's fee or any other
commission directly or indirectly in connection with the transactions
contemplated herein.
4.4 Required Approvals, Notices and Consents. Except as
described herein or in Schedule 4.4 hereof, no consent or approval of,
other action by, or any notice to, any governmental body or agency,
domestic or foreign, or any third party is required in connection with the
execution and delivery by Buyer of this Agreement or the consummation by
Buyer of the transaction contemplated hereby.
5. CONDITIONS PRECEDENT. To the extent that the date of
this Agreement is not also the date of the Closing the following shall
apply: The obligations of each party hereunder are subject to the
fulfillment on or prior to the Closing as follows:
5.1 Representations, Warranties and Agreements. The
representations and warranties of the other party hereto shall be true and
correct in all material respects on the Closing Date as though made on and
as of such date and the other party shall have performed all other
obligations and agreements contained in this Agreement to be performed
prior to the Closing.
6. MISCELLANEOUS.
6.1 Entire Agreement. This Agreement embodies the entire
agreement and understanding of the parties with respect to the subject
matter hereof and supersedes any and all prior agreements, arrangements and
undertakings, whether written or oral, relating to matters provided for
herein. There are no provisions, undertakings, representations or
warranties relative to the subject matter of this Agreement not expressly
set forth herein.
6.2 Expenses. Except as otherwise specifically provided
in this Agreement, all costs and expenses, including, without limitation,
fees and disbursements of counsel, financial advisors and accountants,
incurred in connection with this Agreement and the transaction contemplated
hereby shall be paid by the party incurring such costs and expenses,
whether or not the Closing shall have occurred.
6.3 Notices. Any notice, demand, claim, notice of claim,
request or communication required or permitted to be given under the
provisions of this Agreement shall be in writing and shall be deemed to
have been duly given if delivered personally by facsimile transmission or
sent by first class or certified mail, postage prepaid to the following
addresses,
If to Preis:
Xxxxxx X. Xxxxx
c/o MetroRent, Inc.
0000 Xxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
With a copy to
Xxxxxxx Xxxxxxxx Xxxxx & Stikker LLP
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to McWeeny:
Xxxx X. XxXxxxx
c/o MetroRent, Inc.
0000 Xxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Facsimile: (000) 000-0000
with a copy to:
Xxxxxxx Xxxxxxxx Xxxxx & Stikker LLP
000 Xxxxxxxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxxx, Esq.
Facsimile: (000) 000-0000
If to Buyer:
c/o Cendant Corporation
0 Xxxx 00xx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxx X. Xxxx, Esq.
Facsimile: (000) 000-0000
with a copy to:
Skadden, Arps, Slate, Xxxxxxx & Xxxx LLP
Xxxx Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx Xxx, Esq.
Facsimile: (000) 000-0000
or to such other address as any party may request by notifying in writing
all of the other parties to this Agreement in accordance with this Section
6.3.
Any such notice shall be deemed to have been received on
the date of personal delivery, the date set forth on the postal service
return receipt, the date of delivery shown on the records of the overnight
courier or the date shown on the facsimile confirmation, as applicable.
6.4 Benefit and Assignment. This Agreement will be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns. There shall be no assignment
of any interest under this Agreement by any party except that Buyer may
assign its rights hereunder to any wholly owned subsidiary of Buyer;
provided, however, that no such assignment shall relieve the assignor of
its obligations under this Agreement. Nothing herein, express or implied,
is intended to or shall confer upon any other person any legal or equitable
right, benefit or remedy of any nature whatsoever under or by reason of
this Agreement.
6.5 Waiver. Any waiver of any provision of this Agreement
shall be valid only if set forth in an instrument in writing signed by the
party to be bound thereby. Any waiver of any term or condition shall not be
construed as a waiver of any subsequent breach or a subsequent waiver of
the same term or condition, or a waiver of any other term or condition, of
this Agreement. The failure of any party to assert any of its rights
hereunder shall not constitute a waiver of any such rights.
6.6 Amendment. This Agreement may not be amended or
modified except by an instrument in writing signed by, or on behalf of, the
Sellers and Buyer.
6.7 Release of Claims. The Sellers hereby fully and
unconditionally releases from any and all claims, actions, causes of
actions, lawsuits, damages, liabilities, costs, losses, expenses,
assessments, sums of money, promises and demands of any nature whatsoever
of the Sellers against Buyer and each of its respective officers,
directors, employees or agents which are related to or arise out of (a) any
act taken or omitted to be taken in connection with or in anticipation of
the transactions contemplated hereby or (b) any act taken or omitted to be
taken by Buyer in connection with the transactions contemplated hereby;
provided that the foregoing shall in no event operate as a release of
claims, actions, causes of action, lawsuits, damages, liabilities, costs,
losses, expenses, assessments, sums of money, promises or demands of any
nature whatsoever that in any way relate to or arise out of or in
connection with that certain Asset Purchase Agreement among Parent,
Xxxx.xxx, Sellers and others dated as of October 29, 1999, as amended,
those certain Employment Agreements between Rent Net, Inc. and each Seller
dated December 17, 1999, that certain Escrow Agreement among Xxxx.xxx, Bank
of San Francisco, Sellers and others dated as of December 17, 1999, and
those certain Stock Option Agreements between Xxxx.xxx and each Seller
dated as of January 13, 2000.
6.8 Construction of this Agreement. The language used in
this Agreement shall be deemed to be the language chosen by the parties
hereto to express their mutual agreement, and this Agreement shall not be
deemed to have been prepared by any single party hereto. The headings of
the sections and subsections of this Agreement are inserted as a matter of
convenience and for reference purposes only and in no respect define, limit
or describe the scope of this Agreement or the intent of any section or
subsection. This Agreement may be executed in one or more counterparts and
by the different parties hereto in separate counterparts, each of which
when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
6.9 Governing Law. This Agreement shall be governed by,
enforced under and construed in accordance with, the laws of the State of
New York, without giving effect to any choice of law provision or rule
thereof. The parties submit to the exclusive jurisdiction of the courts of
the State of New York and of the United States of America in each case
located in the County of New York for any litigation arising out of or
relating to the Agreement and the transactions contemplated hereby.
IN WITNESS WHEREOF, this Agreement has been duly executed
by the parties hereto as of the date first above written.
CENDANT MEMBERSHIP SERVICES HOLDINGS, INC.
/s/ Xxxx X. Xxxx
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Name: Xxxx X. Xxxx
Title: Senior Vice President & Secretary
XXXXXX X. XXXXX
/s/ Xxxxxx X. Xxxxx
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XXXX X. XXXXXXX
/s/ Xxxx X. XxXxxxx
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