Exhibit 10.1
GLOBAL HYATT
CORPORATION
2007 STOCKHOLDERS’
AGREEMENT
THIS GLOBAL HYATT CORPORATION
2007 STOCKHOLDERS’ AGREEMENT , dated as of August 28, 2007 (the “
Effective Date ”), is made by and among GLOBAL HYATT
CORPORATION, a Delaware corporation (the “ Company
”), each Person identified on Schedule 1 hereto, and
any other Person who becomes a party to this Agreement pursuant to
the provisions hereof (each, individually, a “
Stockholder ” and, collectively, the “
Stockholders ”).
R E C I T A L
S
WHEREAS, the Company and each of the
Stockholders desire, for their mutual benefit and protection, to
enter into this Agreement to set forth their respective rights and
obligations with respect to the affairs of the Company and the
capital stock held by the Stockholders.
NOW, THEREFORE, in consideration of
the recitals and the mutual premises, covenants and agreements
contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Definitions; Rules of
Construction .
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(a)
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For purposes of
this Agreement, each of the following terms shall have the meaning
ascribed to it in this Section 1 :
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“ AAA ” –
American Arbitration Association.
“ Affiliate ”
– as to any Person any other Person directly or indirectly
controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition
and the definition of Change of Control Transaction,
“control,” as used with respect to any Person, means
the possession, directly or indirectly, of the power to direct or
cause the direction of the management or policies of such Person,
whether through the ownership of voting securities, by agreement or
otherwise. For purposes of this definition, the terms
“controlling,” “controlled by” and
“under common control with” have correlative
meanings.
“ Agreement ”
– this agreement as originally executed or as it may from
time to time be supplemented or amended by one or more agreements
supplemental hereto entered into pursuant to the applicable
provisions hereof.
“ Applicable Market
Value ” – the average of the Closing Price per
share of Common Stock on each of the fifteen (15) consecutive
Trading Days ending on the Trading Day immediately preceding the
relevant date of determination, provided that if the Common Stock
is not listed or regularly traded on any national or regional
securities exchange or association or over-the-counter market, the
Applicable Market Value shall be as determined by the Board (and
validated by the Financial Advisor to the Company).
“ Board ” –
the Board of Directors of the Company.
“ Business Day ”
– any day other than a Saturday, Sunday or other day in the
City of New York on which banking institutions are authorized by
law or regulations to close.
“ Change of Control
Transaction ” – any transaction or series of
related transactions approved by the Board, that results in any
Person who is not an Affiliate of the Company prior to such
transaction or series of transactions acquiring Control of the
Company, which shall include any transaction approved by the Board
that directly or indirectly results in any Person who is not an
Affiliate of the Company prior to such transaction holding more
than fifty percent (50%) of the outstanding shares of Common
Stock.
“ Claim ” –
as defined in Section 15(b) .
“ Closing Price ”
– on any date of determination means the closing sale price
(or, if no closing sale price is reported, the last reported sale
price) of the Common Stock on the New York Stock Exchange or The
Nasdaq Stock Market on such date or, if the Common Stock is not
listed for trading on the New York Stock Exchange or The Nasdaq
Stock Market on any such date, as reported in the composite
transactions for the principal United States securities exchange on
which the Common Stock is so listed, or if the Common Stock is not
so listed on a United States securities exchange, the average of
the last quoted bid price and asking price for the Common Stock in
the over-the-counter market as reported by the National Quotation
Bureau or similar organization, or, if such bid price is not
available, the average of the last quoted bid price and asking
price for the Common Stock on the GS Tradable Unregistered Equity
OTC Market.
“ Common Stock ”
means (i) the common stock, par value $0.01 per share, of the
Company and (ii) Convertible Stock, other than where the term
“Convertible Stock” is specifically used
herein.
“ Company ”
– as defined in the Preamble.
“ Convertible Stock
” means the Series A Convertible Preferred Stock, par value
$0.01 per share, of the Company, which is convertible into shares
of Common Stock in accordance with the terms of the Company’s
Certificate of Designation of the Convertible Stock.
“ Drag Notice ”
– as defined in Section 5(b) .
“ Effective Date
” – as defined in the Preamble.
“ Effective Date Common
Shares ” – in the case of an Initial Holder, the
number of shares of Fully Diluted Common Stock owned by such
Initial Holder on the Effective Date.
“ Exchange Act ”
– the Securities Exchange Act of 1934, as amended, or any
successor federal statute, and the rule and regulations of the
Securities and Exchange Commission thereunder, as the same shall be
in effect from time to time.
“ Excluded Securities
” – any equity securities of the Company (which for
this purpose shall include securities convertible into or
exchangeable for equity securities of the Company, any equity or
profit participation rights, or any rights, options, or
warrants
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to purchase any of the foregoing issued by the
Company subsequent to the date hereof) that consist of any of the
following: (i) issuances to employees, consultants and members
of the Board (or similar governing bodies) of the Company or its
Subsidiaries in connection with the performance of services in such
capacities and made pursuant to any plan adopted by the Board;
(ii) issuance of shares of Common Stock upon conversion of
shares of preferred stock, exercise of options and exercise of
warrants; (iii) the issuance of Common Stock in a Public
Offering; (iv) issuance of securities to financial
institutions, equipment lessors, brokers or similar persons in
connection with commercial credit arrangements, equipment
financings, commercial property lease transactions or similar
transactions approved by the Board; (v) issuance of equity
securities or rights to purchase equity securities issued for
non-cash consideration pursuant to a merger, consolidation,
acquisition or similar business combination approved by the Board;
and (vi) issuance of securities to an entity as a component of
any business relationship with such entity primarily for the
purpose of (A) joint venture, technology, licensing or
development activities, (B) distribution, supply or
manufacture of the Company’s products or services, or
(C) any other arrangements involving corporate partners
primarily for purposes other than raising capital, the terms of
which business relationship with such entity are approved by the
Board.
“ Existing Stockholders
” – (i) members of the Pritzker family who are
lineal descendants of Nicholas J. Pritzker, deceased, and spouses
thereof, (ii) trusts for the benefit of the persons listed in
clause (i) of this definition and/or (iii) Affiliates of
any of the Persons listed in clauses (i) and (ii) of this
definition.
“ Financial Advisor
” means Goldman Sachs & Co. as financial advisor to
the Company, or another nationally recognized investment banking
firm selected by the Company.
“ Framework Agreement
” means that certain Purchase and Framework Agreement, dated
as of the Effective Date, among the Company and the Stockholders
party thereto, as amended from time to time.
“ Fully Diluted Common
Stock ” of any stockholder means the number of shares of
Common Stock then held by such stockholder, assuming the full
exercise of all options, warrants and other securities or
instruments of the Company held by such stockholder that are
convertible, exercisable or exchangeable for shares of Common Stock
(whether or not such securities are then vested, exercisable or
in-the-money), including without limitation, the Convertible
Stock.
“ Governmental
Authority ” – any regional, federal, state or local
legislative, executive or judicial body or agency, any court of
competent jurisdiction, any department, political subdivision or
other governmental authority or instrumentality, or any arbitral
authority, in each case, whether domestic or foreign.
“ GS Change of Control
” – the occurrence of one or more of the foregoing with
respect to GS Group: (i) the sale of all or substantially all
of GS Group’s assets, determined on a consolidated basis, in
one transaction or series of related transactions and/or
(ii) the acquisition (in one or more transactions) by any
Person or Persons acting together or constituting a
“group” under Section 13(d) of the Exchange Act
together with any Affiliates thereof of beneficial ownership (as
defined in Rule 13d-3 under the Exchange Act) or control, directly
or indirectly, of more than 50% of the total voting power of all
classes of securities entitled to vote in the election of directors
of GS Group.
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“ GS Group ”
– The Goldman Sachs Group, Inc.
“ GS Investor ”
– GS Sunray Holdings Parallel, L.L.C., GS Sunray Holdings,
L.L.C. or any of their permitted Transferees.
“ Immediate Family
” – as to any individual, such individual’s
parents, mother-in-law, father-in-law, spouse, brother or sister,
brother-in-law or sister-in-law, son-in-law or daughter-in-law and
children (including by way of adoption), and any person who either
lives in the same household as, provides material support to, or
receives material support from, such individual.
“ Initial Holder
” – (i) any of Thomas J. Pritzker, Penny Pritzker
and/or Gigi Pritzker or (ii) trusts for the benefit of the
individuals described in clause (i) of this definition and/or
for the benefit of their respective spouses and/or lineal
descendants.
“ New Securities
” – as defined in Section 7(a) .
“ Overall Percentage
Interest ” – with respect to any Stockholder, the
percentage equivalent of a fraction the numerator of which is the
total number of shares of Fully Diluted Common Stock held by such
Stockholder, and the denominator of which is the total number of
shares of Fully Diluted Common Stock held by all stockholders of
the Company.
“ Permitted Pledge
” – the grant of a collateral security interest in
Common Stock by or on behalf of a Stockholder; provided that
(i) the Stockholder proposing to use the Common Stock as
collateral advises the Company in advance of the identity of the
proposed lender(s) and secured party (if different from the
lender(s)) (the “ Pledgee ”) and affords the
Company an opportunity to consult with such Stockholder with
respect thereto and (ii) in the event the beneficial ownership
of such Common Stock is Transferred from such Stockholder to the
Pledgee by foreclosure or otherwise, such Transferee (a) is
subject to all of the restrictions and limitations imposed on such
Common Stock and Stockholder in respect thereof prior to such
Transfer (including, without limitation, transfer restrictions,
rights of first refusal and drag-along rights), (b) is not
vested with any of the rights or benefits enjoyed by such
Stockholder with respect to such shares of Common Stock (other than
the right to receive dividends thereon, if, when and as declared by
the Board, tag-along rights, conversion rights and the proceeds
thereof upon a permitted disposition, if any) and (c) each
such Pledgee or potential Pledgee shall agree with the Company in
writing to be bound by the obligations and restrictions applicable
to such Stockholder hereunder.
“ Permitted Transfer
” – one or more Transfers by an Initial Holder made
(i) to or for the benefit of a member or members of the
Immediate Family of such Initial Holder, (ii) to a private
charitable foundation created by the Pritzker Foundation, so long
as such the Transferred Common Stock is held by such foundation,
(iii) to grant collateral security interests so long as there
is no change in beneficial ownership of the Common Stock,
(iv) to another Initial Holder, (v) to one or more trusts
for the benefit of an Initial Holder or an Initial Holder’s
Immediate Family, or (vi) by operation of the provisions of
the trust instrument of a trust which is an Initial
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Holder or which is a successor trust by way of
being a “mirror”, “sub” or
“split” trust, directly or indirectly, of a trust which
is an Initial Holder, so long as the recipient of such Transfer is
a permitted Transferee under clauses (i) through (v) of
this definition; it being understood that any change in trustees of
any such trust is a Permitted Transfer.
“ Person ”
– an individual, a company, a partnership, a joint venture, a
limited liability company or limited liability partnership, an
association, a trust, estate or other fiduciary, any other legal
entity, and any Governmental Authority.
“ Pre-Emptive
Allocation ” – as defined in
Section 7(a) .
“ Pre-Emptive Right
Holder ” – as defined in Section 7(a)
.
“ Pro Rata Portion
” – at any relevant time or with respect to any
relevant period of time, the percentage equivalent of a fraction
the numerator of which is the total number of Effective Date Common
Shares Transferred by an Initial Holder, and the denominator of
which is the total number of Effective Date Common Shares held by
all Initial Holders immediately prior to the relevant time or
period of time.
“ Public Offering
” means (i) any offering by the Company of its equity
securities to the public pursuant to an effective registration
statement under the Securities Act or any comparable statement
under any comparable federal statute then in effect (other than any
registration statement on Form S-8 or Form S-4 or any successor
forms thereto) or (ii) any private distribution by the Company
of its equity securities to more than 50 qualified institutional
buyers.
“ Purchase Agreement
” means that certain Purchase Agreement, dated as of the
Effective Date, among the Company and the Stockholders party
thereto, as amended from time to time.
“ Registration Rights
Agreement ” means that certain Registration Rights
Agreement, dated as of the Effective Date, among the Company and
the Stockholders, as amended from time to time.
“ Qualified Public
Offering ” – a firm commitment underwritten public
offering (or a private distribution to more than 50 qualified
institutional buyers) of the Common Stock that: (i) yields
gross proceeds of not less than $1,000,000,000, or
(ii) results in the sale (including the sale by any selling
shareholders) of fifteen percent (15%) or more of the Common
Stock of the Company outstanding immediately prior to such
offering.
“ Related Person
” – as to any Person, (i) an Affiliate of such
Person, (ii) a member of such Person’s Immediate Family
and/or (iii) any Person who or which is an Affiliate of such
Person’s Immediate Family.
“ Request for
Arbitration ” – as defined in
Section 15(a) .
“ Restricted Stock
” – (i) Common Stock acquired by a Stockholder
from the Company or (ii) Common Stock described in clause
(i) of this definition acquired by a Stockholder from another
Stockholder; provided , however , that Restricted
Stock will not include any shares of Common Stock that have been
sold pursuant to a registration statement or a broad distribution
sale in Transfers permitted by this Agreement.
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“ Restriction Expiration
Date ” – 11:59 pm (Central time) on the day after
the first to occur of (i) the 365 th day following the eighth (8
th ) anniversary of the Effective Date and
(ii) the date that is five and one-half (5.5) years
following the consummation of a Qualified Public
Offering.
“ Section 4(b) Offer
Notice ” – as defined in Section 4(b)
.
“ Section 4(b) Selling
Stockholder ” – as defined in
Section 4(b) .
“ Section 4(c) Offer
Notice ” – as defined in Section 4(c)
.
“ Section 4(c) Selling
Stockholder ” – as defined in
Section 4(c) .
“ Securities Act
” – the Securities Act of 1933, as amended, or any
successor federal statute, and the rule and regulations of the
Securities and Exchange Commission thereunder, as the same shall be
in effect from time to time.
“ Stockholder(s)
” – as defined in the Preamble.
“ Subscription
Agreement ” – that certain Subscription Agreement,
dated as of the Effective Date, among the Company and the
Stockholders party thereto, as amended from time to
time.
“ Subsidiary ”
means, as to a Person, a corporation, partnership, limited
liability company or other entity of which shares of stock or other
ownership interests having ordinary voting power to elect a
majority of the directors or other managers of such corporation,
partnership, limited liability company or other entity
(irrespective of whether or not at the time, any class or classes
of such corporation shall have or might have more voting power by
reason of the happening of any contingency) are at the time owned
by such Person directly or indirectly through Subsidiaries. Unless
context otherwise requires, all references to a Subsidiary or
Subsidiaries under this Agreement shall refer to a direct or
indirect Subsidiary or direct or indirect Subsidiaries of the
Company.
“ Tag Notice ”
– as defined in Section 6(b) .
“ Tag Rights ”
– as defined in Section 6(b) .
“ Trading Day ”
– a day on which the Common Stock (i) is not suspended
from trading on any national or regional securities exchange or
association or over-the-counter market at the close of business and
(ii) has traded at least once on the national or regional
securities exchange or association or over-the-counter market that
is the primary market for the trading of the Common Stock at the
close of business on such day.
“ Transfer ”
– as defined in Section 2 .
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“ Transferee ”
– a Person to whom shares of Restricted Stock are
Transferred.
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(b)
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The following
provisions shall be applied wherever appropriate herein:
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(i)
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for purposes of
this Agreement, the words “hereof,”
“herein,” “hereby” and other words of
similar import refer to this Agreement as a whole unless otherwise
indicated. Whenever the singular is used herein, the same shall
include the plural, and whenever the plural is used herein, the
same shall include the singular, where appropriate. All terms
defined herein in the singular shall have the same meaning when
used in the plural; all terms defined herein in the plural shall
have the same meaning when used in the singular;
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(ii)
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with regard to
each and every term and condition of this Agreement, the parties
hereto understand and agree that the same have or has been mutually
negotiated, prepared and drafted, and that if at any time the
parties hereto desire or are required to interpret or construe any
such term or condition or any agreement or instrument subject
hereto, no consideration shall be given to the issue of which party
actually prepared, drafted or requested any term or condition of
this Agreement;
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(iii)
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all references
herein to Sections, subsections, paragraphs, subparagraphs and
clauses shall be deemed references to such parts of this Agreement,
unless the context shall otherwise require;
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(iv)
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all pronouns
and any variations thereof refer to the masculine, feminine or
neuter, singular or plural, as the context may require;
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(v)
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the words
“include” and “including” and variations
thereof shall not be deemed terms of limitation, but rather shall
be deemed to be followed by the words “without
limitation”;
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(vi)
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any accounting
terms not specifically defined herein shall be construed in
accordance with generally accepted accounting principles as applied
in the United States;
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(vii)
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the Exhibits
and Schedules, if any, attached hereto are incorporated herein by
reference and shall be considered part of this Agreement;
and
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(viii)
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any consent or
approval rights of the Board or the Company contained herein shall
be exercised in the sole and absolute discretion of the Board or
the Company, as applicable, unless otherwise expressly set forth
herein.
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2. Restrictions on Transfer .
Except as expressly permitted in this Agreement, no Stockholder
shall in any way, directly or indirectly (whether by act, omission
or operation of law), sell, exchange, transfer, hypothecate,
negotiate, gift, convey in trust, pledge, assign, encumber, or
otherwise dispose of, or by adjudication of the Stockholder as
bankrupt, by assignment for the benefit of creditors, by
attachment, levy or other seizure by any creditor (whether or not
pursuant to judicial process), or by passage or distribution of
the
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Restricted Stock under judicial order or legal
process, carry out or permit the transfer of, all or any portion of
such Stockholder’s Restricted Stock (any of the foregoing, a
“ Transfer ”). Any Transfer not expressly
permitted herein shall be void and of no effect. Notwithstanding
anything in this Section 2 to the contrary, neither a GS
Change of Control nor transfers of interests in any GS Investor, in
any of the ultimate investment funds investing through such GS
Investor or in any intermediary entities through which any such
investment funds invest through such GS Investor, shall be
considered an assignment for the purposes of this Agreement so long
as the general partner or other managing entities of such GS
Investor or such investment funds or intermediary entities remain
Affiliates of the GS Group.
3. Certain Permitted
Transfers . Notwithstanding anything to the contrary in
Section 2:
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(a)
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A Stockholder
may Transfer all or a portion of such Stockholder’s
Restricted Stock (i) to the Company, (ii) to an Affiliate
of such Stockholder subject to the prior written consent of the
Board, which consent will not be unreasonably withheld,
(iii) as permitted by Sections 3(b) , 3(c) ,
4 , 5 and 6 , (iv) received by such
Stockholder pursuant to Section 3.2 of the Subscription
Agreement and (v) subject to Sections 4 and 5
hereof, following the Restriction Expiration Date.
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(b)
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Subject to Sections 4 and
5 hereof, a Stockholder may Transfer up to a number of
shares of Restricted Stock equal to one-third (
1
/ 3 rd ) of the number of shares of Restricted
Stock (assuming the conversion in full of the Convertible Stock
held by such Stockholder for purposes of determining the number of
such shares subject to the foregoing limitation) it acquired
pursuant to the Subscription Agreement or upon conversion of the
Convertible Stock to un-Affiliated third parties (i) during
each 365-day period beginning on the sixth (6
th ), seventh (7 th ) and eighth (8 th ) anniversaries of the Effective Date, or
(ii) if earlier, the dates that are three and one-half
(3.5) years, four and one-half (4.5) years and five and
one-half (5.5) years following the consummation of a Qualified
Public Offering; provided that in the case of Transfers described
in clause (ii) of this Section 3(b) , such
Transfers are accomplished by way of a broad distribution
sale.
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(c)
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Subject to Sections 4 and
5 hereof, and in addition to Section 3(b) above,
following the first Public Offering, a Stockholder may Transfer up
to a number of shares of Restricted Stock equal to one-third
( 1
/ 3 rd ) of the number of shares of Restricted
Stock (assuming the conversion in full of the Convertible Stock
held by such Stockholder for purposes of determining the number of
such shares subject to the foregoing limitation) it acquired
pursuant to the Subscription Agreement or upon conversion of the
Convertible Stock to un-Affiliated third parties (i) at any
time following the end of the first calendar year during which the
Existing Stockholders at any time during such year owned less than
twenty five percent (25%) of the Common Stock outstanding at
such time or (ii) at any time following both (A) the
second anniversary of the issuance of the Restricted Stock under
the Subscription Agreement or upon the conversion of the
Convertible Stock and (B) the first date on which the
Applicable Market Value exceeded one hundred sixty five percent
(165%) of the gross price per share at which the Common Stock
was first traded in the first Public Offering of the Common Stock;
provided that in the case of
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Transfers described in the
immediately preceding clauses (i) and (ii), such Transfers are
accomplished by way of an underwritten public offering with a
principal underwriter reasonably acceptable to the Company or in an
otherwise broad distribution sale.
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(d)
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Subject to
Sections 4 and 5 hereof, and notwithstanding
Sections 3(b) and 3(c) above, following the first
Qualified Public Offering, in the event that any Initial Holder
Transfers all or any portion of such Initial Holder’s
Effective Date Common Shares (other than pursuant to a Permitted
Transfer), a Stockholder may Transfer up to a Pro Rata Portion of
such Stockholder’s Restricted Stock; provided ,
however , that in any 365-day period in which such
Stockholder is permitted to Transfer shares of Restricted Stock
under Section 3(b) and in any calendar year in which
such Stockholder is permitted to Transfer shares of Restricted
Stock under Section 3(c) (including clause
(ii) thereof), such Stockholder’s right to transfer a
Pro Rata Portion of its Restricted Stock under this
Section 3(d) shall apply only to the extent that the
aggregate number of Effective Date Common Shares held at the
commencement of such 365-day period or calendar year and
Transferred by Initial Holders in such 365-day period or calendar
year, as a percentage of the aggregate number of Effective Date
Common Shares held by Initial Holders at the commencement of such
365-day period or calendar year, exceeds the maximum percentage of
such Stockholder’s shares of Restricted Stock that such
Stockholder is permitted to sell in such 365-day period or calendar
year, with the result that only such excess number of Effective
Date Common Shares so Transferred by Initial Holders will be taken
into account in determining such Stockholder’s Pro Rata
Portion for purposes of this Section 3(d) . The rights
described in this Section 3(d) shall expire on the
Restriction Expiration Date.
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(e)
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No Transfer may be made pursuant
to this Section 3 which would violate or be
inconsistent with any other agreement a Stockholder may have with
the Company, or which would result in registration by the Company
or of any securities of the Company being required under any
applicable laws (unless such Transfer is made in connection with
and subject to any such registration). No Transfer may be made
under this Section 3 , unless the Transferee
(i) agrees in writing with the Company to be bound by the
provisions of this Agreement as though it were a Stockholder, and
(ii) unless waived by the Board (or a designee of the Board to
whom such authority has been delegated), causes to be delivered to
the Company, at such Transferee’s sole cost and expense, a
favorable opinion of legal counsel reasonably acceptable to the
Board (or a designee of the Board to whom such authority has been
delegated), to the effect that such Transfer does not violate or
result in registration being required under any applicable law. In
addition, such Transferee shall execute and deliver such other
instruments and documents, in form and substance reasonably
satisfactory to the Board (or a designee of the Board to whom such
authority has been delegated) (including, any instrument necessary
to cause the Transferee to become a Stockholder), as are reasonably
requested by the Company in connection with such Transfer. Upon
compliance with all
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provisions hereof, all other
Stockholders agree to execute and deliver such amendments hereto as
are necessary to cause such Transferee to become a Stockholder.
Following the first Public Offering, the second, third and fourth
sentences of this Section 3(e) shall not apply in the
case of Transfers pursuant to (i) a registration statement
under the Securities Act or (ii) a broad distribution
sale.
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(f)
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Notwithstanding
any other provision of this Section 3 , no Stockholder
may Transfer, and no Person may acquire, the legal or beneficial
ownership of any Restricted Stock unless such acquiring
Person’s ownership of Restricted Stock is not reasonably
likely to jeopardize any licensing from a Governmental Authority
with respect to the Company or any of its Subsidiaries, as
determined by the Board in its reasonable discretion. Following the
first Public Offering, the restrictions described in this
Section 3(f) shall be qualified by the “actual
knowledge” of the Transferring Stockholder in the case of
Transfers pursuant to an underwritten public offering or a broad
distribution sale.
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(g)
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A Transferee
who becomes a Stockholder pursuant to this Section 3
shall have, to the extent Transferred, the rights and powers, and
shall be subject to the restrictions and liabilities, of a
Stockholder under this Agreement.
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(h)
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Under no
circumstances shall a Transfer be made (i) to a competitor of
the Company engaged in one or more of the hospitality, lodging
and/or gaming industries, (ii) to an aggregator (meaning, a
Person who is required to file a Schedule 13D (or successor form)
under the Exchange Act disclosing an intent other than for
investment) or (iii) which would cause a Stockholder to
violate any provision of this Agreement, including
Section 9(e) hereof. Following the first Public
Offering, the restrictions described in this
Section 3(h) shall be qualified by the “actual
knowledge” of the Transferring Stockholder in the case of
Transfers pursuant to an underwritten public offering or a broad
sale distribution.
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(i)
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For the
purposes of Section 3(f) and 3(h) , in the case
of Transfers pursuant to an underwritten public offering or a broad
distribution sale, a Transferring Stockholder will be deemed to
have “actual knowledge” only of (i) transferees
disclosed in the final prospectus, prospectus supplement, offering
memorandum or offering circular for such public offering or broad
distribution sale.
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4. Right of First Refusal
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(a)
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Subject to
Section 4(e) , the provisions of this
Section 4 shall apply (i) to all Transfers prior
to the consummation of the first Public Offering and
(ii) following the consummation of the first Public Offering,
only in the event that the number of shares of Common Stock
proposed to be Transferred by a Stockholder (and its Affiliates)
together with any shares of Common Stock then proposed to be
Transferred by the other Stockholders (and their Affiliates)
exceeds two percent (2%) of the then outstanding shares of
Common Stock.
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(b)
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Subject to
Section 4(e) , prior to the consummation of the first
Public Offering, if any Stockholder is permitted and proposes to
Transfer all or any portion of its Common Stock in accordance with
this Agreement to a third party purchaser, then such Stockholder
(the “ Section 4(b) Selling Stockholder ”)
shall, prior to consummating such sale, offer in a written notice
to Transfer such Common Stock to the Company, specifying the terms
and conditions of such proposed Transfer as offered by the third
party purchaser (the “ Section 4(b) Offer Notice
”). The Company shall have twenty-one (21) days from the
date the Section 4(b) Offer Notice was received to accept the
offer to Transfer all, but not less than all, of the Common Stock
subject to the Section 4(b) Offer Notice. If the Company does
not accept the offer provided in the Section 4(b) Offer Notice
within such period, it shall be deemed to have rejected the offer.
The closing of any Transfer pursuant to this
Section 4(b) shall occur in accordance with the terms
and provisions of the offer and this Agreement. If the Company does
not accept such offer pursuant to this Section 4(b) ,
then at the expiration of the twenty-one (21) day notice
period (or, if earlier, upon the express rejection in writing by
the Company of such offer), subject only to Section 3 ,
the Section 4(b) Selling Stockholder may Transfer the offered
Common Stock to the proposed Transferee, provided that such
Transfer occurs within sixty (60) days after the expiration of
such twenty-one (21) day period and is made on terms and
conditions no more favorable to the Transferee in the aggregate
than the terms and conditions specified in the Section 4(b)
Offer Notice. To the extent shares of Common Stock are to be
Transferred to the Company pursuant to this
Section 4(b) , each Section 4(b) Selling
Stockholder shall cause such shares of Common Stock to be
Transferred free and clear of all liens, claims, encumbrances and
other restrictions (other than as set forth in this
Agreement).
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(c)
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Subject to
Section 4(e) , following the consummation of the first
Public Offering, if any Stockholder is permitted and proposes to
Transfer all or any portion of its Common Stock in accordance with
this Agreement to a third party purchaser, then such Stockholder
(the “ Section 4(c) Selling Stockholder ”)
shall, prior to consummating such sale, offer in a written notice
to Transfer such Common Stock to the Company at the Applicable
Market Value (the “ Section 4(c) Offer Notice ”)
as of the date of such Section 4(c) Offer Notice. The Company
shall have five (5) Business Days from the date the
Section 4(c) Offer Notice was received to accept the offer to
Transfer all, but not less than all, of the Common Stock subject to
the Section 4(c) Offer Notice. If the Company does not accept
the offer provided in the Section 4(c) Offer Notice within
such period it shall be deemed to have rejected the offer. The
closing of any Transfer pursuant to this Section 4(c)
shall occur within three (3) Business Days following
acceptance by the Company of such offer. If the Company does not
accept such offer pursuant to this Section 4(c) , then
at the expiration of the five (5) Business Day notice period
(or, if earlier, upon the express rejection in writing by the
Company of such offer), subject only to Section 3 , the
Section 4(c) Selling Stockholder may Transfer the offered
Common Stock to the proposed Transferee, provided that such
Transfer (a) occurs within (i) three (3) Business
Days, in the case of a private placement, after the expiration of
such five (5) Business Day period or (ii) fifteen
(15) Business Days, in the case of a public offering pursuant
to a registration
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statement, after the expiration of
such five (5) Business Day period and (b) is made on
terms and conditions no more favorable in the aggregate to the
Transferee than the terms and conditions specified in the
Section 4(c) Offer Notice; provided that a downward
fluctuation of five percent (5%) or less in the price per
share being paid by the proposed Transferee caused by a drop in the
market price of the Common Stock during the three (3) Business
Day or fifteen (15) Business Day period, as the case may be,
after the expiration of such five (5) Business Day period
shall not be taken into account in determining whether the Transfer
to the proposed Transferee is made on terms and conditions no more
favorable in the aggregate to the Transferee than the terms and
conditions specified in the Section 4(c) Offer Notice. To the
extent shares of Common Stock are to be Transferred to the Company
pursuant to this Section 4(c) , each Section 4(c)
Selling Stockholder shall cause such shares of Common Stock to be
Transferred free and clear of all liens, claims, encumbrances and
other restrictions (other than as set forth in this
Agreement).
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(d)
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Any proposed
Transfer by a Section 4(b) Selling Stockholder or
Section 4(c) Selling Stockholder not consummated within the
time periods set forth in this Section 4 shall again be
subject to this Section 4 and shall require compliance
by such Section 4(b) Selling Stockholder or Section 4(c)
Selling Stockholder with the procedures described in this
Section 4 . The exercise or non-exercise of the rights
of the Company under this Section 4 with respect to any
proposed Transfer shall not adversely affect its rights with
respect to subsequent Transfers by a Section 4(b) Selling
Stockholder or a Section 4(c) Selling Stockholder under this
Section 4 .
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(e)
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The provisions
of this Section 4 are subordinate to those of
Section 5 , and shall not apply to Transfers under
Section 5 or to any Transfer permitted by
Section 3(a)(i) , 3(a)(ii) or 3(a)(iv)
.
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5. Drag-Along Right
.
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(a)
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In connection with a Change of
Control Transaction, the Company shall have the right to require
each Stockholder (i) to convert such Stockholder’s
shares of Convertible Stock, if any, into Common Stock, and
(ii) to participate in such Change of Control Transaction on
the same terms, conditions and price per share of Common Stock as
those applicable to the other holders of Common Stock of the
Company (with respect to their Common Stock). In addition, upon the
request of the Company, the Stockholders agree to vote in favor of
such Change of Control Transaction, or any sale, lease or exclusive
license of all or substantially all of the Company’s assets
(directly or indirectly) to one or more Persons who are not
Affiliates of the Company in a transaction or series of related
transactions approved by the Board, and the Company shall have the
right to require each Stockholder to vote for, consent to and raise
no objection to any such transaction (or transactions); and if such
right is exercised by the Company, each Stockholder shall vote all
of its Common Stock in favor of, and shall raise no objection to,
any such transaction (or transactions). In the event that the
Company exercises its rights
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pursuant to this
Section 5 , (i) no Stockholder will be obligated
to pay more than its pro rata share of transaction expenses
incurred (based on the proportion of the aggregate transaction
consideration received) in connection with such Change of Control
Transaction to the extent that such expenses are incurred for the
benefit of all stockholders and are not otherwise paid by the
Company or the acquiring party (expenses incurred by or on behalf
of a stockholder for its sole benefit not being considered expenses
incurred for the benefit of all stockholders) and (ii) any
representations and warranties made by and indemnifications
provided by the Stockholders will be on a several and not a joint
basis with Stockholders and other stockholders of the Company
participating in such transaction.
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(b)
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In the event
that the Company desires to exercise its rights pursuant to this
Section 5 , the Company shall notify each Stockholder
in writing of the proposed Transfer no less than fifteen
(15) Business Days prior to the contemplated consummation date
of the proposed Transfer or transaction (the “ Drag
Notice ”). Such notice shall set forth: (i) a
description of the proposed Transfer or other transaction,
(ii) the name of the proposed purchaser, and (iii) the
proposed amount and form of consideration and terms and conditions
of payment offered by the proposed purchaser. Any proposed Transfer
or transaction pursuant to this Section 5 that is not
consummated within one hundred twenty (120) days following the
date of the Drag Notice, shall again be subject to the notice
provisions of this Section 5(b) and shall require
compliance by the Company with the procedures described in this
Section 5(b) .
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(c)
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To the extent
in conflict with the provisions of this Section 5 , the
provisions of Sections 4 and 6 are subordinate to and
shall not apply to any Transfer or exercise of rights contemplated
by this Section 5 .
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6. Tag Along Right
.
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(a)
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Subject to the
fiduciary duties of the Board, the Company will not agree to
consummate a Change of Control Transaction with respect to which
the Stockholders are not given the right to participate on the same
terms, conditions and price per share of Common Stock as those
applicable to the other holders of Common Stock of the Company
(with respect to their Common Stock). In the event that a
Stockholder exercises its rights pursuant to this
Section 6 , (i) no Stockholder will be obligated
to pay more than its pro rata share of transaction expenses
incurred (based on the proportion of the aggregate transaction
consideration received) in connection with such Change of Control
Transaction to the extent that such expenses are incurred for the
benefit of all stockholders and are not otherwise paid by the
Company or the acquiring party (expenses incurred by or on behalf
of a stockholder for its sole benefit not being considered expenses
incurred for the benefit of all stockholders) and (ii) any
representations and warranties made by and indemnifications
provided by any Stockholder participating in such Change of Control
Transaction will be on a several and not a joint basis with other
stockholders of the Company participating in such
transaction.
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(b)
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In the event
that the Company desires to consummate a Change of Control
Transaction, the Company shall notify each Stockholder in writing
of such proposed transaction no less than fifteen
(15) Business Days prior to the contemplated consummation date
of such proposed transaction (the “ Tag Notice
”). Such Tag Notice shall set forth: (i) a description
of the proposed transaction, (ii) the name of the proposed
purchaser, and (iii) the proposed amount and form of
consideration and terms and conditions of payment offered by the
proposed purchaser. Each Stockholder will have the right, upon
written notice to the Company, delivered within ten (10) days
after receipt of the Tag Notice, and provided such Stockholder has
converted all of its shares of Convertible Stock into Common Stock
to participate in the proposed Change of Control Transaction on the
terms and conditions set thereof (such participation rights being
hereinafter referred to as “ Tag Rights ”). In
the event a Stockholder has not notified the Company of its intent
to exercise such Tag Rights within ten (10) days of receipt of
a Tag Notice, such Stockholder will be deemed to have elected not
to exercise such Tag Rights with respect to the transaction
contemplated by such Tag Notice. Any proposed Change of Control
Transaction that is the subject of a Tag Notice that is not
consummated within one hundred twenty (120) days following the
date of the Tag Notice shall again be subject to the notice
provisions of Section 6 and shall require compliance by
the Company and the Stockholders with the procedures described in
this Section 6(b) .
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(c)
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The provisions
of this Section 6 shall be subject and subordinate to
the provisions of Section 4 and 5 and, to the
extent in conflict therewith, shall not apply.
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7. Pre-Emptive Rights
.
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(a)
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Each
Stockholder (for the purpose of this Section 7 , each a
“ Pre-Emptive Right Holder ”) shall have the
right to purchase such Pre-Emptive Right Holder’s Overall
Percentage Interest (for the purpose of this Section 7
the “ Pre-Emptive Allocation ”), or any lesser
number, of any new shares of Common Stock, or any other equity
securities of the Company, including securities convertible into,
exercisable for, or exchangeable for Common Stock, that the Company
may, from time to time, propose to sell and issue, in each case,
other than Excluded Securities and securities issued in connection
with stock splits, stock dividends, in-kind equity distributions
and recapitalizations (collectively, “ New Securities
”).
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(b)
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In the event the Company proposes
to undertake an issuance of New Securities, it will give each
Pre-Emptive Right Holder written notice of such issuance (which
notice shall be delivered at least fifteen (15) days prior to
such issuance), describing the New Securities and the price and
terms upon which the Company proposes to issue the same, and
setting forth the number of shares or other number of New
Securities which such Stockholder is entitled to purchase pursuant
to such Stockholder’s Pre-Emptive Allocation and the
aggregate purchase price therefor. Each Pre-Emptive Right Holder
will have
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ten (10) days from the date of
delivery of any such notice from the Company to agree to purchase a
specified portion of such New Securities up to such
Stockholder’s Pre-Emptive Allocation, or any lesser number,
for the price and upon the terms specified in the notice (provided
that the Pre-Emptive Right Holders shall be entitled to pay cash in
lieu of any non-cash consideration) by giving written notice to the
Company and stating therein the quantity of New Securities to be
purchased. If not all of the Pre-Emptive Right Holders elect to
purchase their full Pre-Emptive Allocation of New Securities, then
the Company shall notify in writing the fully-participating
Pre-Emptive Right Holders of such and offer such holders the right
to acquire such unsubscribed New Securities. Each
fully-participating Pre-Emptive Right Holder so notified shall have
the right to purchase its pro rata share of the unsubscribed New
Securities (in proportion to the Overall Percentage Interests of
all fully participating Pre-Emptive Right Holders) within five
(5) days from the date of such notice from the Company by
giving written notice to the Company and stating therein the
quantity of unsubscribed New Securities to be purchased.
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(c)
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In the event
any Pre-Emptive Right Holder fails to exercise such right of first
refusal within said ten (10) day period (or, as applicable,
such 15-day period), the Company will have seventy five
(75) days thereafter to sell the New Securities as to which
such Pre-Emptive Right Holder’s right was not exercised, at a
price and upon such other terms no more favorable to the purchasers
thereof than those specified in the Company’s notice. In the
event the Company has not sold such New Securities within said
seventy five (75)-day period, the Company will not thereafter issue
or sell any New Securities without first offering such New
Securities to each Pre-Emptive Rights Holder in the manner provided
above.
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(d)
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The pre-emptive
rights granted by this Section 7 shall be exercisable
only by “accredited investors” as defined under
Section 501 of Regulation D of the Securities Act.
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(e)
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The closing of
any sale of New Securities shall be on the date set forth in the
notice provided by the Company pursuant to Section 7(b)
; provided , that such date shall be extended as to any
participating Pre-Emptive Right Holder for up to forty
(40) days (or such longer period as may be approved by the
Company, which approval shall not be unreasonably delayed or
withheld) for purposes of obtaining any necessary approvals from
Governmental Authorities. The exercise or non-exercise of the
rights of the Pre-Emptive Right Holders under this
Section 7 shall not adversely affect their rights to
participate in subsequent offerings of New Securities subject to
Section 7 .
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8. Voting; Board Seats;
Access .
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(a)
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Until the later
of (i) December 31, 2013 and (ii) the date that
Thomas J. Pritzker is no longer the Chairman of the Board of the
Company, each Stockholder will vote all of its Common Stock
consistent with the recommendations of a majority of the Board with
respect to all matters.
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(b)
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Prior to the
first Public Offering and so long as Madrone Capital, LLC (or any
Affiliate of Madrone Capital, LLC who becomes a Stockholder) owns
or has the right to acquire at least 20% of the Common Stock that
it acquires or has the right to acquire on the Effective Date,
Madrone Capital, LLC (or any Affiliate of Madrone Capital, LLC who
becomes a Stockholder) shall have the right to designate, and the
Board will appoint, one (1) representative to the Board, which
individual shall be subject to the good faith prior approval of the
Nominating and Governance Committee of the Board; provided
that each of Rob Walton and Greg Penner shall be deemed approved
for the purposes of this Section 8(b) , and Greg Penner
shall be the initial appointee pursuant to this
Section 8(b) .
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(c)
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Prior to the
first Public Offering and so long as GS Sunray Holdings Parallel,
L.L.C. owns at least 20% of the Common Stock issuable upon
conversion of the Convertible Stock acquired by such Stockholder on
the Effective Date, GS Capital Partners VI Parallel, L.P., the
ultimate parent of such Stockholder, shall have the right to
designate, and the Board will appoint, one (1) representative
to the Board, which individual shall be subject to the good faith
prior approval of the Nominating and Governance Committee of the
Board; provided , that Byron Trott shall be deemed approved
for the purposes of this Section 8(c) , and shall be
the initial appointee pursuant to this Section 8(c)
.
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(d)
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A director
appointed pursuant to either Section 8(b) or
Section 8(c) above may resign, or will be removed
either (i) with or without cause at the direction of the
Person who designated such director (or its successor or permitted
Transferee), or (ii) by the affirmative vote or written
consent of a majority of the remaining members of the Board if such
director dies or otherwise becomes incapable of fulfilling his or
her obligations because of injury or physical or mental illness and
such incapacity shall exist for thirty (30) Business Days in
the aggregate during any consecutive six (6) month period. The
Person who designated any such deceased, removed or resigning
director (or its successor or permitted Transferee) shall be
entitled to designate a replacement for such director, which
individual shall be appointed to the Board (subject to the prior
good faith approval of the Nominating and Governance Committee of
the Board).
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(e)
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The rights to
designate representatives for appointment to the Board shall
terminate and each Person’s designee to the Board shall
resign if so requested by the Company (i) immediately prior to
the consummation of the first Public Offering, and if so requested
by the Company, the designating Person will direct its then serving
appointed representative to resign from the Board or (ii) at
such time as any Stockholder or any if such Stockholder’s
Affiliates has the right (whether or not exercised) to designate or
appoint a member of or observer to the Board (or similar governing
body) of any entity that is a direct competitor of the Company or
its Subsidiaries.
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(f)
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For so long as
GS Sunray Holdings Parallel, L.L.C. owns any shares of Restricted
Stock, the Company covenants and agrees with GS Capital Partners VI
Parallel, L.P. as follows:
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(i)
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GS Capital
Partners VI Parallel, L.P. or its representatives may examine the
books and records of the Company and visit and inspect its
facilities and may reasonably request information at reasonable
times and intervals concerning the general status of the
Company’s financial conditions and operations.
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(ii)
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On reasonable
prior written notice, GS Capital Partners VI Parallel, L.P. or its
representatives may discuss the business operations, properties and
financial and other conditions of the Company with the
Company&r
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