Exhibit 2.2
HOST MARRIOTT,
L.P.
6 3 / 8
% Series N Senior Notes
due 2015
Payment of Principal and Interest
Unconditionally
Guaranteed by the Guarantors Thereof
PURCHASE
AGREEMENT
March 3, 2005
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004,
Deutsche Bank Securities Inc.
60 Wall Street, 10 th Floor
New York, New York 10005
and
Citigroup Global Markets Inc.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Host Marriott, L.P., a Delaware limited
partnership (the “ Company ” or the “
Operating Partnership ”), proposes to issue and sell
to the initial purchasers named in Schedule B hereto (each,
an Initial Purchaser, and collectively, the “ Initial
Purchasers ”) for which Goldman, Sachs & Co.,
Deutsche Bank Securities Inc. and Citigroup Global Markets Inc. are
acting as representatives (the “Representatives”), an
aggregate of $650,000,000 principal amount of 6
3
/ 8 % Series N Senior Notes due 2015
(the “ Series N Notes ”), which notes are fully
and unconditionally guaranteed by the subsidiaries of the Company
listed on Schedule A hereto (the “ Guarantors
”). The Series N Notes (and related guarantees) are to be
issued pursuant to the provisions of the Amended and Restated
Indenture, dated as of August 5, 1998 by and among HMH Properties,
Inc., the Guarantors (as named therein) and The Bank of New York,
as successor trustee (the “ Trustee ”) (the
“ Base Indenture ”) and the Sixteenth
Supplemental Indenture (the “ Sixteenth Supplemental
Indenture ” and, together with the Base Indenture, the
“ Indenture ”) to be dated as of the Closing
Date (as defined in Section 4 below), by and among the Company, the
Guarantors and the Trustee.
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For purposes of this agreement, the
term “ Securities ” means the $650,000,000
aggregate principal amount of the Series N Notes, together with the
guarantees (the “ Guarantees ”) thereof by each
of the Guarantors. The Securities and the Indenture are more fully
described in the Offering Memorandum (as hereinafter defined).
Capitalized terms used herein without definition have the
respective meanings specified in the Offering Memorandum, unless
otherwise set forth herein.
1. Offering Memorandum . The
Securities will be offered and sold to the Initial Purchasers
pursuant to exemptions from the registration requirements under the
Securities Act of 1933, as amended (the “ Act
”). The Company and the Guarantors have prepared a final
offering memorandum, dated March 3, 2005 relating to the Series N
Notes and the Guarantees (together with any documents incorporated
by reference therein (excluding any supplement or amendment after
the date hereof), the “ Offering Memorandum
”).
Upon original issuance thereof, and
until such time as the same is no longer required pursuant to the
Indenture, the Series N Notes (and all securities issued in
exchange therefor or in substitution thereof) shall bear the
following legend:
“THIS NOTE (OR ITS
PREDECESSOR) HAS NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT
OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED, EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF
OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER:
(1) REPRESENTS THAT (A) IT IS NOT AN
AFFILIATE (AS DEFINED IN RULE 144 UNDER THE SECURITIES ACT) OF THE
OPERATING PARTNERSHIP OR THE GUARANTORS, (B) IT IS A
“QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE
144A UNDER THE SECURITIES ACT) (A “QIB”) AND (C) IT IS
PURCHASING THIS NOTE FOR ITS OWN ACCOUNT OR AN ACCOUNT OVER WHICH
IT EXERCISES SOLE INVESTMENT DISCRETION, AND IT AND ANY SUCH
ACCOUNT IS A “QUALIFIED PERSON” (AS DEFINED IN SECTION
49(a)(1)(D)(iv) OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED
(THE “CODE”). FOR THIS PURPOSE, A PERSON WOULD BE
CONSIDERED A “QUALIFIED PERSON” IF IT IS A BANK,
SAVINGS & LOAN ASSOCIATION, INSURANCE
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COMPANY, PENSION TRUST, FUND
(INCLUDING PARTNERSHIPS, TRUSTS, MUTUAL FUNDS, HEDGE FUNDS,
SEPARATE ACCOUNTS AND PORTFOLIO MANAGERS) OR ANY OTHER ENTITY THAT
REGULARLY LENDS MONEY OR PURCHASES DEBT SECURITIES FROM ISSUERS IN
PRIMARY OFFERINGS. A PERSON, HOWEVER, WOULD NOT BE A QUALIFIED
PERSON IF IT (A) DIRECTLY OR INDIRECTLY OWNS MORE THAN 10% OF THE
OPERATING PARTNERSHIP OR (B) HAS A DIRECT OR INDIRECT MORE-THAN-10%
OWNER WHO ALSO DIRECTLY OR INDIRECTLY OWNS MORE THAN 10% OF THE
OPERATING PARTNERSHIP.
(2) AGREES THAT IT WILL NOT RESELL
OR OTHERWISE TRANSFER THIS NOTE EXCEPT (A) TO THE OPERATING
PARTNERSHIP OR ANY GUARANTOR WHOLLY OWNED BY THE OPERATING
PARTNERSHIP OR ANY OF THEIR RESPECTIVE WHOLLY OWNED SUBSIDIARIES,
(B) TO A PERSON WHO IS A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR
THE ACCOUNT OF A QIB IN A TRANSACTION MEETING THE REQUIREMENTS OF
RULE 144A, (C) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE
144 UNDER THE SECURITIES ACT, (D) TO AN INSTITUTIONAL
“ACCREDITED INVESTOR” (AS DEFINED IN RULE 501 (A)(1),
(2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES ACT) THAT,
PRIOR TO SUCH TRANSFER, FURNISHES THE TRUSTEE A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE
TRANSFER OF THIS NOTE (THE FORM OF WHICH CAN BE OBTAINED FROM THE
TRUSTEE) AND, IF SUCH TRANSFER IS IN RESPECT OF AN AGGREGATE
PRINCIPAL AMOUNT OF NOTES LESS THAN $250,000, AN OPINION OF COUNSEL
ACCEPTABLE TO THE OPERATING PARTNERSHIP THAT SUCH TRANSFER IS
EXEMPT UNDER THE SECURITIES ACT, (E) IN ACCORDANCE WITH ANOTHER
EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT
(AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE OPERATING
PARTNERSHIP), OR (F) PURSUANT TO AN EFFECTIVE REGISTRATION
STATEMENT AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER
APPLICABLE JURISDICTION; PROVIDED THAT, FOR ANY TRANSACTION
PURSUANT TO CLAUSE (B), (C), (D), OR (E) WITHIN TWO YEARS OF THE
ISSUANCE OF THIS NOTE, THE TRANSFEREE REPRESENTS THAT IT IS A
“QUALIFIED PERSON” (AS DEFINED ABOVE); AND
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(3) AGREES THAT IT WILL DELIVER TO
EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN IS TRANSFERRED
A NOTICE AS TO THE ABOVE RESTRICTIONS.
2. Agreements to Sell and
Purchase. On the basis of the representations and warranties
contained in this Agreement, and subject to the terms and
conditions herein set forth, the Company and, as to the Guarantees,
the Guarantors, agree to issue and sell to each of the Initial
Purchasers, and each of the Initial Purchasers agrees, severally
and not jointly, to purchase from the Company and, as to the
Guarantees, the Guarantors, the Series N Notes at a purchase price
to the Company equal to 98.5% of the principal amount at maturity
of the Series N Notes ( i.e. , $640,250,000), in the
respective principal amount set forth opposite their names on
Schedule B hereto.
3. Terms of Offering. The
Initial Purchasers have advised the Company that the Initial
Purchasers will offer and sell (the “ Exempt Resales
”) the Securities purchased hereunder on the terms set forth
in the Offering Memorandum, as amended or supplemented, solely to
persons whom the Initial Purchasers reasonably believe to be
“qualified institutional buyers” as defined in Rule
144A of the Act (“ QIBs ”) and who the Initial
Purchasers reasonably believe are regularly engaged in the business
of lending money or purchasing debt securities from issuers in
primary offerings (such persons being referred to herein as the
“ Eligible Purchasers ”), and the parties hereto
acknowledge and agree that a purchaser is an “Eligible
Purchaser” if it is a bank, savings and loan association,
insurance company, pension trust, fund (including partnerships,
trusts, mutual funds, hedge funds, separate accounts, and portfolio
managers) or any other entity that regularly lends money or
purchases debt securities from issuers in primary
offerings.
The Initial Purchasers will offer
the Securities to Eligible Purchasers initially at a price equal to
100% of the principal amount thereof. Such price may be changed at
any time without notice.
Holders (including subsequent
transferees) of the Securities will have the registration rights
set forth in the registration rights agreement (the “
Registration Rights Agreement ”), to be dated the
Closing Date, in substantially the form of Schedule D
hereto, for so long as such Securities constitute “
Transfer Restricted Securities ” (as defined in the
Registration Rights Agreement). Pursuant to the Registration Rights
Agreement, the Company and the Guarantors will agree to file with
the Securities and Exchange Commission (the “
Commission ”) under the circumstances set forth
therein, (i) a registration statement under the Act (the “
Exchange Offer Registration Statement ”) relating to a
new series of the Company’s 6 3 / 8
% Senior Notes due 2015
guaranteed by the Guarantors (the “ Series O Notes
” and, together with the Securities, the “ Notes
”), to be offered in exchange for the Securities
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(such offer to exchange being referred to as the
“ Exchange Offer ”) and the Guarantees by the
Guarantors thereof and (ii) a shelf registration statement pursuant
to Rule 415 under the Act (the “ Shelf Registration
Statement ” and, together with the Exchange Offer
Registration Statement, the “ Registration Statements
”) relating to the resale by certain holders of the
Securities and to use their best efforts to cause such Registration
Statements to be declared and remain effective and usable for the
periods specified in the Registration Rights Agreement and to
consummate the Exchange Offer.
4. Delivery and Payment.
Delivery to you of and payment for the Securities shall be made at
10:00 A.M., New York City time at the offices of Latham &
Watkins LLP, 555 11 th Street, N.W., Washington, D.C.
20004 on the fifth Business Day following the date of this
Agreement (the “Closing Date”). The Closing Date and
the location of delivery of the Securities may be varied by
agreement among you and the Company.
One or more of the Securities in
definitive form, registered in the name of Cede & Co., as
nominee of The Depository Trust Company (“ DTC
”), or such other name(s) as the Initial Purchasers may
request in writing upon at least two Business Days’ notice to
the Company, having an aggregate principal amount corresponding to
the aggregate principal amount of such series of Securities (the
“ Global Securities ”) shall be delivered by the
Company to the Initial Purchasers on the Closing Date, with any
transfer taxes payable upon initial issuance thereof duly paid by
the Company, for your respective accounts against payment by the
Initial Purchasers of the purchase price thereof in currently
available funds, to the order of the Company. The Global Securities
shall be made available to you at the offices of the
Representatives (or at such other place as shall be acceptable to
you) for inspection not later than 9:30 A.M., New York City time,
on the Business Day next preceding the Closing Date.
5. Agreements of the Company and
the Guarantors. Each of the Company and the Guarantors, jointly
and severally, agrees with each of you that:
(a) It will advise you promptly and,
if requested by any of you, confirm such advice in writing, (i) of
the issuance by any state securities commission of any stop order
suspending the qualification or exemption from qualification of any
Series N Notes for offering or sale in any jurisdiction designated
by the Initial Purchasers pursuant to Section 5(e) hereof, or the
initiation of any proceeding by any state securities commission or
any other federal or state regulatory authority for such purpose
and (ii) of the happening of any event during the period referred
to in Section 5(c) below that makes any statement of a material
fact made in the Offering Memorandum (as amended or supplemented
from time to time) untrue or that requires any additions to or
changes in the Offering Memorandum in order to make the statements
therein, in light of the circumstances under which they were made,
not misleading.
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Each of the Company and each of the Guarantors
shall use its reasonable best efforts to prevent the issuance of
any stop order or order suspending the qualification or exemption
of the Securities under any state securities or Blue Sky laws and,
if at any time any state securities commission or other federal or
state regulatory authority shall issue an order suspending the
qualification or exemption of the Securities under any state
securities or Blue Sky laws, the Company and the Guarantors shall
use every reasonable effort to obtain the withdrawal or lifting of
such order at the earliest possible time.
(b) It will furnish the Initial
Purchasers and those persons identified as Eligible Purchasers by
the Initial Purchasers to the Company as many copies of the
Offering Memorandum, and any amendments or supplements thereto, as
the Initial Purchasers may reasonably request for the time period
specified in Section 5(c). Subject to the accuracy of the Initial
Purchasers’ representations and warranties and the Initial
Purchasers’ compliance with their agreements set forth in
Section 7 hereof, the Company and the Guarantors consent to the use
of the Offering Memorandum, and any amendments and supplements
thereto required pursuant hereto, by the Initial Purchasers in
connection with Exempt Resales.
(c) If during such period as in the
opinion of counsel for the Initial Purchasers an Offering
Memorandum is required to be delivered in connection with Exempt
Resales by the Initial Purchasers, it will (i) not make any
amendment or supplement to the Offering Memorandum of which the
Initial Purchasers shall not previously have been advised or to
which the Initial Purchasers shall reasonably object after being so
advised and (ii) prepare promptly upon the Initial
Purchasers’ reasonable request, any amendment or supplement
to the Offering Memorandum which may be necessary or advisable in
connection with such Exempt Resales.
(d) If, during the period referred
to in Section 5(c) above, any event shall occur or condition shall
exist as a result of which it becomes necessary to amend or
supplement the Offering Memorandum in order to make the statements
therein, in the light of the circumstances existing as of the date
of the Offering Memorandum, not misleading, or if it is necessary
to amend or supplement the Offering Memorandum to comply with any
applicable law, it will promptly prepare an appropriate amendment
or supplement to such Offering Memorandum so that the statements
therein, as so amended or supplemented, will not, in the light of
the circumstances when it is so delivered, be misleading, or so
that such Offering Memorandum will comply with applicable law, and
furnish to the Initial Purchasers such number of copies thereof as
the Initial Purchasers may reasonably request.
(e) Prior to the sale of all
Securities pursuant to Exempt Resales as contemplated hereby, it
will cooperate with the Initial Purchasers and counsel to the
Initial Purchasers in connection with the registration or
qualification of the Securities for offer and
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sale to the Initial Purchasers and pursuant to
Exempt Resales under the securities or Blue Sky laws of such
jurisdictions in the United States as the Initial Purchasers may
request and continue such registration or qualification in effect
so long as required for Exempt Resales and file such consents to
service of process or other documents as may be necessary in order
to effect such registration or qualification; provided,
however , that neither the Company nor any Guarantor shall be
required in connection therewith to qualify as a foreign
corporation in any jurisdiction in which it is not now so qualified
or to take any action that would subject it to general consent to
service of process or taxation in any jurisdiction in which it is
not now so subject.
(f) Neither the Company nor any
Guarantor will engage in any form of general solicitation or
general advertising (as those terms are used in Regulation D of the
Act) in connection with the offering of the Securities or in any
manner involving a public offering within the meaning of Section
4(2) of the Act.
(g) So long as the Notes are
outstanding, the Company will file on a timely basis with the
Commission, to the extent such filings are accepted by the
Commission, and whether or not the Company has a class of
securities registered under the Securities Exchange Act of 1934, as
amended (the “ Exchange Act ”), the annual
reports, quarterly reports and other documents that the Company
would be required to file if it were subject to Section 13 or
Section 15(d) of the Exchange Act. For so long as the Initial
Purchasers are making a market in the Notes, but in no event, more
than five years from the date hereof, the Company will furnish to
you, upon request and as soon as available, copies of all such
reports and information, together with such other documents,
reports and information as shall be furnished by the Company to the
holders of the Notes, and such other information concerning the
Company and its subsidiaries as you reasonably may
request.
(h) So long as the Notes are
outstanding, it will furnish to the Initial Purchasers, upon
request and as soon as available, copies of all reports or other
communications furnished by the Company or any of the Guarantors to
any of its holders or furnished to or filed with the Commission and
such other publicly available information concerning the Company,
the Guarantors and/or their respective subsidiaries as the Initial
Purchasers may reasonably request.
(i) So long as any of the Securities
remain outstanding and during any period in which the Company and
the Guarantors are not subject to Section 13 or 15(d) of the
Exchange Act, upon the request of any holders of Notes it will
furnish to such holder and to any prospective purchaser of Series N
Notes from such holder, the information (“ Rule 144A
Information ”) required by Rule 144A(d)(4) under the Act;
provided , however , that the Company’s
obligations under this Section 5(i) shall terminate upon the
earlier of (i) the date
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the Exchange Offer is concluded and the exchange
of the Exchange Securities for the Securities tendered therein is
consummated or (ii) the date the Shelf Registration Statement is
declared effective by the Commission; provided, further ,
that, notwithstanding the foregoing provisions, the Company shall
be obligated to deliver, upon request, any information required by
Rule 144A(d)(4) under the Act to prospective purchasers of the
Securities during any period during which, pursuant to the
Registration Rights Agreement, the Shelf Registration Statement is
required to be effective, but such effectiveness has been suspended
or revoked for any reason.
(j) Whether or not the transactions
contemplated hereby are consummated or this Agreement is
terminated, it will pay and be responsible for all costs, expenses,
fees and taxes in connection with or incident to (i) the printing,
processing, filing and distribution of the Offering Memorandum and
all amendments or supplements thereto (but not including, however,
legal fees and expenses of your counsel incurred in connection
therewith), including such copies as may be reasonably requested by
you, (ii) the issuance, transfer and delivery of the Securities to
you and pursuant to Exempt Resales, including any transfer or other
taxes payable thereon, (iii) the registration or qualification of
the Securities for offer and sale under the securities or Blue Sky
laws of the jurisdictions referred to in paragraph 5(e) above
(including, in each case, any filing fees and fees and expenses of
counsel to the Initial Purchasers incurred in connection
therewith), (iv) the rating of the Securities by investment rating
agencies, (v) the approval of the Securities by DTC for
“book-entry” transfer, (vi) the performance by each of
the Company and the Guarantors of its other obligations under this
Agreement, including (without limitation) the fees of the Trustee,
the cost of its personnel and other internal costs, the cost of
printing and engraving the certificates representing the
Securities, and all expenses and taxes incident to the sale and
delivery of the Securities to you (but not including, however,
legal fees and expenses of your counsel incurred in connection
therewith) and (vii) all expenses and listing fees in connection
with the application for inclusion of the Securities in the Private
Offerings, Resales and Trading through Automatic Linkages Market
(“ PORTAL ”) of the National Association of
Securities Dealers, Inc. (“ NASD ”).
(k) It will use its best efforts to
effect the inclusion of the Securities in PORTAL and to maintain
such inclusion for so long as the Securities are
outstanding.
(l) [Intentionally
omitted].
(m) During the period beginning on
the date hereof and continuing to and including the Closing Date,
it will not offer, sell, contract to sell or otherwise transfer or
dispose of any debt securities of the Company or any Guarantor or
any warrants, rights or options to purchase or otherwise acquire
debt securities of the Company or any Guarantor
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substantially similar to the Securities (other
than (i) the Securities and (ii) commercial paper issued in the
ordinary course of business), without the prior written consent of
the Initial Purchasers, which consent shall not be unreasonably
withheld.
(n) It will use the proceeds from
the sale of the Securities in the manner described in the Offering
Memorandum under the caption “Use of
Proceeds.”
(o) It will not claim voluntarily,
and will actively resist any attempts to claim, the benefit of any
usury laws against the holders of any Notes.
(p) It will comply with all of its
agreements set forth in the Registration Rights
Agreement.
(q) Each of the Guarantors and the
Company will execute and deliver, file and record all instruments
and documents, and will do all such acts and other things as are
necessary to subject the Collateral (as defined in the Indenture)
to the security interests intended to be created by the Amended and
Restated Pledge and Security Agreement, dated as of September 10,
2004 by and among the Pledgors (as defined therein) and Deutsche
Bank Trust Company Americas, as collateral agent, as amended to
date (the “Pledge and Security Agreement”) in favor of
the Pledgee (as defined in the Pledge and Security Agreement) for
the benefit of the holders of the Notes and as are reasonably
necessary or advisable to perfect the security interests intended
to be created thereby.
(r) It will use its reasonable best
efforts to do and perform all things required or necessary to be
done and performed under this Agreement by it prior to the Closing
Date and to satisfy all conditions precedent to the delivery of the
Series N Notes and the Guarantees.
(s) It will not sell, offer for sale
or solicit offers to buy or otherwise negotiate in respect of any
security (as defined in the Act) that would be integrated with the
sale of the Series N Notes to the Initial Purchasers or pursuant to
Exempt Resales in a manner that would require the registration of
any such sale of the Series N Notes under the Act.
(t) It will use its best efforts to
continue to be classified and treated as a partnership for Federal
income tax purposes for its taxable year ending December 31, 2005
and continue to be so classified and treated thereafter.
(u) It shall treat the Securities as
indebtedness for tax purposes and shall not take any position
inconsistent therewith.
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6. Representations and
Warranties. Each of the Company and each of the Guarantors,
jointly and severally, represents and warrants to each of you
that:
(a) The Offering Memorandum does not
contain, and, together with any supplement or amendment to it, the
Offering Memorandum will not contain, any untrue statement of a
material fact or omit to state any material fact necessary in order
to make the statements therein, in the light of the circumstances
under which they were made, not misleading; except that the
representations and warranties contained in this paragraph (a)
shall not apply to statements in or omissions from the Offering
Memorandum (or any supplement or amendment thereto) made in
reliance upon and in conformity with information relating to you
furnished to the Company or its agents in writing by you expressly
for use therein. The Company acknowledges for all purposes under
this Agreement that the statements with respect to the price of the
Securities and the third and fifth paragraphs appearing under the
caption “Plan of Distribution” in the Offering
Memorandum (or any amendment or supplement thereto) constitute the
only written information furnished to the Company by any of the
Initial Purchasers expressly for use in the Offering Memorandum (or
any amendment or supplement thereto) (the “Initial
Purchasers’ Information”) and that you shall not be
deemed to have provided any other information (and therefore are
not responsible for any such statement or omission). No stop order
preventing the use of the Offering Memorandum, or any amendment or
supplement thereto, or any order asserting that any of the
transactions contemplated by this Agreement are subject to the
registration requirements of the Act, has been issued.
(b) Each of the Company, the
Guarantors and their respective subsidiaries has been duly
organized, is validly existing as a limited partnership, general
partnership, limited liability company or unlimited company, as the
case may be, in good standing (except for the Guarantors that are
general partnerships, as to which the concept of “good
standing” does not apply) under the laws of its respective
jurisdiction of organization and has the requisite power and
authority to carry on its business as it is currently being
conducted, and to own, lease and operate its properties; and, as
applicable, has the requisite power and authority to authorize the
offering of the Notes, to execute, deliver and perform this
Agreement and to issue, sell and deliver the Notes; and each of the
Company, the Guarantors and their respective subsidiaries is duly
qualified and is in good standing as a foreign corporation (or
other entity) authorized to do business in each jurisdiction where
the operation, ownership or leasing of property or the conduct of
its business requires such qualification, except where the failure
to be so qualified would not, singly or in the aggregate, have a
material adverse effect on the properties, business, results of
operations, condition (financial or otherwise), business affairs or
prospects of the Company, the Guarantors and their respective
subsidiaries taken as a whole (a “ Material Adverse
Effect ”).
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(c) All of the issued and
outstanding shares of capital stock of, or other ownership
interests in, each subsidiary of the Company have been duly and
validly authorized and issued, and all of the shares of capital
stock of, or other ownership interests in, each such subsidiary
other than the subsidiaries set forth on Schedule C (which
subsidiaries are so owned in the amounts listed thereon) is owned,
directly or through subsidiaries, by the Company. All such shares
of capital stock are fully paid and nonassessable (except for the
capital stock of the Guarantors incorporated or amalgamated under
the laws of the Province of Nova Scotia, the capital stock of
which, is assessable pursuant to Section 135 of the Companies Act
(Nova Scotia)), and are owned free and clear of any security
interest, mortgage, pledge, claim, lien or encumbrance (each, a
“ Lien ”), except for security interests in
shares of certain subsidiaries of the Company pursuant to the
Pledge and Security Agreement relating to the Company’s
7 7
/ 8 % Series B senior notes due 2008,
8 3 / 8 % Series E senior notes due 2006,
9¼% Series G senior notes due 2007, 9½% Series I senior
notes due 2007, 7 7 / 8 Series K senior notes due 2013, 7%
Series M senior notes due 2012 and 3.25% exchangeable senior
debentures due 2024 (collectively, the “ Existing Senior
Notes ”), borrowings under the Amended and Restated
Credit Agreement, dated September 10, 2004, as further amended,
modified or supplemented, among the Company, the banks party
thereto from time to time, and Deutsche Bank Trust Company
Americas, as administrative agent (the “ Credit
Facility ”), certain other obligations set forth in the
Pledge and Security Agreement including security interests in the
profits and losses of, payments due to and various claims and
privileges of certain subsidiaries of the Company and, from and
after the Closing Date, the Notes. There are no outstanding
subscriptions, rights, warrants, options, calls, convertible
securities, commitments of sale or Liens (other than Liens relating
to the Pledge and Security Agreement) related to or entitling any
person to purchase or otherwise to acquire any shares of the
capital stock of, or other ownership interest in, any subsidiary of
the Company owned directly or indirectly by the Company.
(d) On the Closing Date, the
Indenture will have been duly authorized and validly executed and
delivered by the Company and the Guarantors and, when duly executed
and delivered in accordance with its terms, will be a valid and
legally binding agreement of the Company and the Guarantors,
enforceable against the Company and the Guarantors in accordance
with its terms (assuming the due execution and delivery thereof by
the Trustee) subject to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium or similar types of laws of
general applicability relating to or affecting creditors’
rights and to general equity principles, and will conform in all
material respects to the descriptions thereof in the Offering
Memorandum.
(e) On the Closing Date, the
Securities will have been duly authorized for issuance and sale to
you pursuant to this Agreement by the Company and the Guarantors
and the Securities will have been duly executed by the Company and
the
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Guarantors and will conform in all material
respects to the descriptions thereof in the Offering Memorandum.
When the Securities are issued, authenticated and delivered in
accordance with the Indenture and paid for in accordance with the
terms of this Agreement, the Securities will constitute valid and
legally binding obligations of the Company and each of the
Guarantors, enforceable against the Company and each of the
Guarantors in accordance with their terms and entitled to the
benefits of the Indenture subject to bankruptcy, insolvency,
fraudulent transfer, reorganization, moratorium or similar types of
laws of general applicability relating to or affecting
creditors’ rights and to general equity
principles.
(f) Neither the Company, the
Guarantors nor any of their subsidiaries has received from any
governmental authority notice of any condemnation of or zoning
change affecting their respective properties or any part thereof or
of any violation of any municipal, state or federal law, rule or
regulation concerning its properties or any part thereof which has
not heretofore been cured or which would have a Material Adverse
Effect, or which could reasonably be expected to have a Material
Adverse Effect, and neither the Company, the Guarantors nor any of
their respective subsidiaries knows of any such condemnation or
zoning change which is threatened on any of their properties or any
such violation, which could reasonably be expected to have a
Material Adverse Effect. Neither the Company, the Guarantors nor
any of their respective subsidiaries is in violation of its
respective charter or bylaws or other similar organizational
instrument or in default in the performance of any bond, debenture,
note or any other evidence of indebtedness or any indenture,
mortgage, deed of trust or other contract, lease or other
instrument to which any of the Company, the Guarantors or any of
their respective subsidiaries is a party or by which any of them is
bound, or to which any of the property or assets of any of the
Company, the Guarantors or any of their respective subsidiaries is
subject, except for such violations or defaults which would neither
have a Material Adverse Effect nor reasonably be expected
materially and adversely to affect the consummation of this
Agreement or the transactions contemplated hereby.
(g) This Agreement has been duly
authorized and validly executed and delivered by the Company and
each of the Guarantors and constitutes a valid and legally binding
agreement of the Company and each of the Guarantors, enforceable
against the Company and each of the Guarantors in accordance with
its terms (assuming the due execution and delivery hereof by the
Initial Purchasers of this Agreement) subject to bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or
similar laws of general applicability relating to or affecting
creditors’ rights and to general equity
principles.
(h) The execution and delivery of
this Agreement, the Indenture and the Registration Rights Agreement
by the Company and each of the Guarantors, the issuance and sale of
the Notes, the performance of this Agreement, the Indenture and
the
12
Registration Rights Agreement and the
transactions contemplated hereby and thereby will not (i) conflict
with or result in a breach or violation of any of the respective
charter or bylaws or other similar organizational instrument of the
Company, the Guarantors or any of their respective subsidiaries or
any of the terms or provisions thereof, (ii) result in the
suspension, termination or revocation of any Authorization (as
defined below) of the Company, the Guarantors or any of their
respective subsidiaries or other impairment of the rights of the
holder of any such Authorization, (iii) constitute a default or
cause an acceleration of any obligation under or result in the
imposition or creation of (or the obligation to create or impose) a
Lien with respect to, any bond, note, debenture or other evidence
of indebtedness or any indenture, mortgage, deed of trust or other
agreement or instrument to which the Company, the Guarantors or any
of their respective subsidiaries is a party or by which it or any
of them is bound, or to which any properties of the Company, the
Guarantors or any of their respective subsidiaries is or may be
subject except for Liens in respect of the Securities or (iv)
contravene any order of any court or governmental agency or body
having jurisdiction over the Company, the Guarantors or any of
their respective subsidiaries or any of their properties, or
violate or conflict with any statute, rule or regulation or
administrative or court decree applicable to the Company, the
Guarantors or any of their respective subsidiaries, or any of their
respective properties except in the case of clauses (ii), (iii) or
(iv) above, for such suspensions, terminations, revocations,
impairments, conflicts or violations which would neither have a
Material Adverse Effect nor reasonably be expected materially and
adversely to affect the consummation of this Agreement or the
transactions contemplated hereby.
(i) Except as may be described in
the Offering Memorandum, there is no action, suit or proceeding
before or by any court or governmental agency or body, domestic or
foreign, pending against or affecting the Company, the Guarantors
or any of their respective subsidiaries, or their respective
properties, which is required to be disclosed in the Offering
Memorandum and is not so described, or which would result, singly
or in the aggregate, in a Material Adverse Effect or which could
reasonably be expected to materially and adversely affect the
consummation of this Agreement or the transactions contemplated
hereby, and to the best of the Company’s knowledge, no such
proceedings are contemplated or threatened. No contract or document
of a character required to be described in the Offering Memorandum
in order to prevent the Offering Memorandum as of its date from
containing any untrue statement of a material fact or omitting to
state any material fact necessary in order to make the statements
therein, in light of the circumstances under which they were made,
not misleading, is not so described.
(j) To the best knowledge of the
Company and each of the Guarantors, (A) no action has been taken
and no statute, rule or regulation or order has been enacted,
adopted or issued by any governmental agency or body which prevents
the issuance of the Securities, prevents or suspends the use of the
Offering Memorandum or suspends the
13
sale of the Securities in any jurisdiction
referred to in Section 5(e) hereof and (B) no injunction,
restraining order or order of any nature by a Federal or state
court of competent jurisdiction has been issued with respect to the
Company, the Guarantors or any of their respective subsidiaries
which would prevent or suspend the issuance or sale of the
Securities or the use of the Offering Memorandum in any
jurisdiction referred to in Section 5(e) hereof. Every request of
any securities authority or agency of any jurisdiction for
additional information (to be included in the Offering Memorandum)
has been complied with in all material respects.
(k) Except as would not, singly or
in the aggregate, have a Material Adverse Effect, neither the
Company, the Guarantors nor any of their respective subsidiaries is
in violation of any environmental, safety or similar law or
regulation applicable to its business relating to the protection of
human health and safety, the environment or hazardous or toxic
substances or wastes, pollutants or contaminants (“
Environmental Laws ”), lacks any permits, licenses or
other approvals required of them under applicable Environmental
Laws or is violating any terms and conditions of any such permit,
license or approval.
(l) The Company is not aware of any
existing or imminent labor disturbance by the employees of any of
its principal suppliers, manufacturers or contractors, or of
Marriott International (or its subsidiaries) which would have a
Material Adverse Effect.
(m) Except with respect to the Hotel
Trades Council and Hotel Association Pension Fund and the Host
International, Inc. Cleveland Retirement Benefit Plan, neither the
Company, the Guarantors nor any of their respective subsidiaries
has sponsored, maintained or contributed to, directly or
indirectly, within the last five years, any employee benefit plan
subject to Title IV of ERISA, including without limitation
“multiemployer plans” (as defined in Section 4001(a)(3)
of ERISA).
(n) Neither the Company, the
Guarantors nor any of their respective subsidiaries has violated
any provisions of the Foreign Corrupt Practices Act or the rules
and regulations promulgated thereunder, except for such violations
which, singly or in the aggregate, would not have a Material
Adverse Effect.
(o) (i) Each of the Company, the
Guarantors and their respective subsidiaries have good and
marketable and insurable title, free and clear of all Liens, to all
property and assets described in the Offering Memorandum as being
owned by it, except for Liens described in the Offering Memorandum
(including, without limitation, all Liens relating to mortgages
reflected on the historical or pro forma financial statements or
described in the notes thereto included or incorporated by
reference in the Offering Memorandum) and Liens imposed pursuant to
the Pledge and Security Agreement or by the indentures relating to
the
14
Existing Senior Notes and the Credit Facility or
Liens that would not have a Material Adverse Effect and (ii) all
liens, charges, encumbrances, claims or restrictions on or
affecting the properties and assets of the Company, the Guarantors
or their respective subsidiaries that are required to be disclosed
in the Offering Memorandum are disclosed.
(p) To the Company’s
knowledge, KPMG LLP, who have certified certain financial
statements of the Company and its subsidiaries, are independent
public accountants within the meaning of the Act and the rules and
regulations of the Commission thereunder.
(q) Except as disclosed in the
Offering Memorandum subsequent to the respective dates as of which
information is given in the Offering Memorandum and up to the
Closing Date, neither the Company, the Guarantors nor any of their
respective subsidiaries has incurred any liabilities or
obligations, direct or contingent, which are material to the
Company, the Guarantors and their respective subsidiaries taken as
a whole, nor entered into any material transaction not in the
ordinary course of business and there has not been, singly or in
the aggregate, any material adverse change, or any development
which would involve a material adverse change, in the properties,
business, results of operations, condition (financial or
otherwise), business affairs or prospects of the Company, the
Guarantors and their respective subsidiaries taken as a whole (a
“ Material Adverse Change ”).
(r) No consent, approval,
authorization, order, registration or consent of, or with any court
or governmental agency or body is required for the issue and sale
of the Securities or the consummation by the Company and the
Guarantors of transactions contemplated by this Agreement, except
such as have been obtained and made under state securities or Blue
Sky laws or regulations.
(s) Neither the Company, the
Guarantors nor any of their affiliates is presently doing business
with the government of Cuba or with any person or affiliate located
in Cuba.
(t) (i) Each of the Company, the
Guarantors and their respective subsidiaries has all certificates,
consents, exemptions, orders, permits, licenses, authorizations or
other approvals (each, an “ Authorization ”) of
and from, and has made all declarations and filings with, all
Federal, state, local and other governmental authorities, all
self-regulatory organizations and all courts and other tribunals,
necessary or required to own, lease, license and use its properties
and assets and to conduct its business in the manner described in
the Offering Memorandum and all such Authorizations are in full
force and effect, except to the extent that the failure to obtain
or file or cause to remain in effect would not, singly or in the
aggregate, have a Material Adverse Effect, (ii) the Company, the
Guarantors and their
15
respective subsidiaries are in compliance in all
material respects with the terms and conditions of all such
Authorizations and with the rules and regulations of the regulatory
authorities and governing bodies having jurisdiction with respect
thereto and (iii) neither the Company, the Guarantors nor their
respective subsidiaries has received any notice of proceedings
relating to the revocation or modification of any Authorization,
which singly or in the aggregate, if the subject of an unfavorable
decision, ruling or finding, would have a Material Adverse
Effect.
(u) Neither the Company, the
Guarantors nor their respective subsidiaries is, and, after giving
effect to the offering and sale of the Notes and the application of
the proceeds thereof as described in the Offering Memorandum, will
be, an “investment company” or a company
“controlled” by an investment company within the
meaning of the Investment Company Act of 1940, as
amended.
(v) Each certificate signed by any
officer of the sole general partner of the Company or any officer
of the general partner or managing member of any of the Guarantors
and delivered to the Initial Purchasers o
