THIRD AMENDMENT TO
EXCLUSIVE JOINT VENTURE AGREEMENT
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THIS THIRD AMENDMENT TO EXCLUSIVE JOINT VENTURE AGREEMENT, dated May
1, 1997 ("Third Amendment"), is entered into by and between PROMUS HOTELS, INC.,
a Delaware corporation ("PHI"), and VISTANA, INC., a Florida corporation
("Vistana").
R E C I T A L S:
A. PHI and Vistana Development, Ltd., a Florida limited partnership
("VDL"), are parties to a certain Exclusive Joint Venture Agreement dated
December 24, 1996 (the "Initial Agreement"), as amended by a certain First
Amendment to Exclusive Joint Venture Agreement dated February 7, 1997 ("First
Amendment") and a certain Second Amendment to Exclusive Joint Venture Agreement
dated February 27, 1997 ("Second Amendment") (the Initial Agreement as amended
by the First Amendment and Second Amendment is hereinafter referred to as the
"Amended Agreement") pursuant to which, among other things, the parties have
agreed to jointly develop Vacation Resorts.
B. VDL has heretofore transferred and assigned all of its right,
title and interest in and under the Amended Agreement to Vistana, and Vistana
has assumed all of the obligations of VDL under the Amended Agreement.
C. PHI and Vistana desire to amend the Amended Agreement as provided
herein.
NOW, THEREFORE, in consideration of the foregoing, and of other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending legally to be bound, have agreed and
by these presents do amend the Amended Agreement and agree as follows:
1. Defined Terms. All capitalized terms used herein shall have the
same meanings ascribed to them in the Amended Agreement except as otherwise
defined herein to the contrary or unless the context requires otherwise.
2. Acknowledgment of Satisfaction of Conditions. The parties
acknowledge and agree that (a) the parties have approved the Five Year
Plan, (b) the parties have approved the form of (i) Sales and Marketing
Agreement, (ii) Franchise Agreement (consisting of a License Agreement
between Promus and the property developer and a License Agreement between
Promus and the association manager), (iii) PHI Management Agreement
(consisting of a Hospitality Management Agreement between Promus and the
property developer, and a Hospitality
Submanagement Agreement between the association manager and Promus), (iv)
Non-Venture Franchise Agreement (consisting of a License Agreement between
Promus and the property developer and a License Agreement between Promus
and the association manager) and (v) Non-Venture Management Agreement
(consisting of a Hospitality Management Agreement between Promus and the
property developer and a Hospitality Submanagement Agreement between Promus
and the association manager). The parties have also executed and delivered
the form of Non-Venture Franchise Agreement with respect to Vistana's
Vacation Resorts in Myrtle Beach and Kissimmee and a Non-Venture Management
Agreement with respect to Vistana's Vacation Resort in Myrtle Beach. The
parties hereby acknowledge and agree that the provisions of Section
15(a)(ii) of the Amended Agreement are null and void and of no force or
effect.
3. Amendments to Section 15 of the Second Amended Agreement. Section
15 of the Amended Agreement is hereby amended as follows:
A. By changing subparagraph "(c)" thereof to subparagraph "(d)" and
by adding the following new subparagraph (c):
"(c) Change-In-Control. In the event of a "Change-In-Control" of
either PHI or Vistana (the "Applicable Party"), either party shall
have the right to terminate this Agreement by delivery of written
notice thereof to the other party at any time after such Change-In-
Control and prior to the date that is ninety (90) days after the
Applicable Party shall have notified the other party in writing of
such Change-In-Control. For purposes hereof, a "Change-In-Control"
shall mean a transfer by the Applicable Party of all or substantially
all of its assets to a competitive hospitality company (as hereinafter
defined) or a competitive hospitality company acquires through one or
more series of transactions more than fifty percent (50%) of any class
of issued and outstanding capital stock of the Applicable Party or of
any entity which controls the Applicable Party and such competitive
hospitality company has the ability to elect a majority of the
directors of the Applicable Party or of any entity which controls the
Applicable Entity. The term "competitive hospitality company" shall
mean any person or entity which, directly or indirectly, is in the
business of operating or franchising hotels, resorts or other
transient lodging facilities or controls, is controlled by or is under
common
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control with, any person or entity which, directly or indirectly, is
in the business of operating or franchising hotels, resorts or other
transient lodging facilities."
B. By deleting subparagraph (d)(i) of Section 15 (formerly
subparagraph (c)(i) of Section 15) and by substituting the following:
"(i) any Venture then in existence shall remain in existence and
continue to be governed by its Venture Agreement and other applicable
Transaction Documents and any franchise, license or management
relationship in existence shall remain in existence and continue to be
governed by the applicable Franchise Agreement, Management Agreement
or other applicable Transaction Documents; and"
4. Addition of New Section 24. A new Section 24 is hereby added to
the Amended Agreement as follows:
"24. Non-Solicitation. Each party hereto agrees, during the Term of
this Agreement, that such party and such party's Affiliates shall not,
directly or indirectly, solicit for employment or hire any person
employed by the other party or any of such other party's subsidiaries
or Affiliates at a position of Manager or higher."
5. Addition of New Section 25. A new Section 25 is hereby added to
the Amended Agreement as follows:
"25. Acknowledgment of Exclusivity. The parties hereto acknowledge and
agree that nothing contained in any Franchise Agreement or Non-Venture
Franchise Agreement (including, without limitation, the provisions of
Paragraph 2 thereof) is intended to or shall limit or modify the
exclusivity obligations of the parties to each other hereunder
including, without limitation, the obligations of the parties to each
other under Section 4 hereof."
6. Acknowledgment. Promus acknowledges that VDL has assigned, and
Vistana has assumed, VDL's rights and obligations under the Amended
Agreement pursuant to Section 13 of the Amended Agreement. Accordingly, VDL
is hereby released from any and all obligations arising subsequent to the
date of such assignment.
7. Integration of Amendment. Except as provided herein, the Amended
Agreement is hereby confirmed and the
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terms and provisions thereof, unless modified herein, shall remain in full
force and effect.
8. Counterparts. This Third Amendment may be executed in several
counterparts and all so executed shall constitute one agreement binding on
the parties hereto, notwithstanding that all the parties are not
signatories to the original or the same counterpart.
IN WITNESS WHEREOF, the parties hereto have executed this Third Amendment,
or have caused this Third Amendment to be duly executed on their respective
behalf by their respective officers thereunto duly authorized, as of the day and
year first above written.
PROMUS HOTELS, INC.
By: /s/ Nadine Greenwood
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Name: Nadine Greenwood
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Title: Assistant Secretary
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VISTANA, INC.
By: /s/ Susan Werth
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Name: Susan Werth
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Title: Senior Vice President and
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General Counsel
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