EXHIBIT 99.1
EXECUTION COPY
COMPANY SHAREHOLDER SUPPORT AGREEMENT
COMPANY SHAREHOLDER SUPPORT AGREEMENT dated as of June 30, 1998
(this "Agreement"), by Stanley Taube, an individual, S.M. Taube & Co., Inc.,
a Nevada corporation ("Taube Co." and together with Stanley Taube, the
"Taube Entities"), Lyle Berman, an individual, and Neil I. Sell, as trustee
of Amy Berman Irrevocable Trust dated August 9, 1989, Bradley Berman
Irrevocable Trust dated August 9, 1989, Jessie Lynn Berman Irrevocable Trust
dated August 9, 1989 and Julie Berman Irrevocable Trust dated August 9, 1989
(collectively, the "Berman Irrevocable Trusts," and together with the Taube
Entities and Lyle Berman, the "Shareholders") to and for the benefit of Grand
Casinos, Inc., a Minnesota corporation ("Company") and Hilton Hotels
Corporation, a Delaware corporation ("Hilton"). Capitalized terms used and
not otherwise defined herein shall have the respective meanings assigned to
them in the Merger Agreement referred to below.
WHEREAS, as of the date hereof, the Taube Entities collectively
own, of record and beneficially, 993,289 shares of Company Common Stock (such
shares, together with any other voting or equity securities of Company,
hereafter acquired by any of the Taube Entities prior to the termination of
this Agreement, being referred to herein collectively as the "Taube Shares");
WHEREAS, as of the date hereof, Lyle Berman collectively owns, of
record and beneficially, 4,751,462 shares of Company Common Stock (such
shares, together with any other voting or equity securities of Company,
hereafter acquired by Lyle Berman prior to the termination of this Agreement,
being referred to herein collectively as the "Berman Shares");
WHEREAS, as of the date hereof, the Berman Irrevocable Trusts
collectively own, of record and beneficially, 1,242,000 shares of Company
Common Stock (such shares, together with any other voting or equity
securities of Company, hereafter acquired by any of the Berman Irrevocable
Trusts prior to the termination of this Agreement, being referred to herein
collectively as the "Berman Irrevocable Trusts Shares," and together with the
Taube Shares and the Berman Shares, the "Shares");
WHEREAS, concurrently with the execution of this Agreement, Hilton,
Company, Gaming Co., Inc., a Delaware corporation and a wholly-owned
subsidiary of Hilton ("Gaming Co."), Gaming Acquisition Corporation, a
Minnesota corporation and a wholly-owned subsidiary of Gaming Co. ("Merger
Sub") and GCI Lakes, Inc., a Minnesota corporation and a wholly-owned
subsidiary of Company ("Lakes") are entering into an Agreement and Plan of
Merger, dated as of the date hereof (as the same may be amended or modified
from time to time in accordance with the terms thereof, the "Merger
Agreement"), pursuant to which, upon the terms and subject to the conditions
thereof, Merger Sub will merge with and into Company, with Company as the
surviving corporation (the "Merger");
WHEREAS, subject to shareholder ratification and certain other
conditions, the Board of Directors of Company has approved certain
transactions, set forth in the Company
Distribution Agreement attached as Exhibit B to the Merger Agreement (the
"Company Distribution Agreement") pursuant to which (a) all of the
operations, assets and liabilities of Company and its Subsidiaries comprising
the Non-Mississippi Business (as defined in the Company Distribution
Agreement) will be contributed to Lakes and (b) all of the shares of Lakes
will be distributed on a pro rata basis to Company's shareholders (the
"Distribution");
WHEREAS, consummation of the Distribution is a condition to Gaming
Co.'s obligation to effect the Merger under the Merger Agreement; and
WHEREAS, as a condition to the willingness of Hilton and Company to
enter into the Merger Agreement, Company has requested that the Shareholders
agree, and in order to induce Hilton and Company to enter into the Merger
Agreement, the Shareholders are willing to agree, severally but not jointly,
to vote in favor of adopting the Merger Agreement and approving the Merger,
upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants and agreements contained herein, and intending to be legally bound
hereby, the parties hereby agree, severally and not jointly, as follows:
Section 1. VOTING OF SHARES. Each Shareholder hereby agrees
that, at the Company's Shareholders Meeting or any other meeting of the
shareholders of Company, however called, and in any action by written consent
of the shareholders of Company, such Shareholder will vote or cause to be
voted all of his or its respective Shares (a) in favor of adoption of the
Merger Agreement and approval of the Merger, the Distribution and the other
transactions contemplated by the Merger Agreement, (b) against any
Acquisition Proposal or any other action or agreement that would result in a
breach of any representation, warranty, covenant, agreement, or other
obligation of Company under the Merger Agreement or which could result in any
of the conditions to Company's obligations under the Merger Agreement not
being fulfilled and (c) in favor of any other matter necessary to the
consummation of the transactions contemplated by the Merger Agreement and
considered and voted upon by the shareholders of Company (or any class
thereof). In addition, each Shareholder agrees that he or it will, upon
request by Hilton, furnish written confirmation, in form and substance
reasonably satisfactory to Hilton, of such Shareholder's support for the
Merger Agreement, the Merger and the Distribution. Each Shareholder
acknowledges receipt and review of a copy of the Merger Agreement.
Section 2. TRANSFER OF SHARES. Until the termination of this
Agreement in accordance with the terms hereof, no Shareholder will, directly
or indirectly, (a) sell, assign, transfer (including by merger, testamentary
disposition, interspousal disposition pursuant to a domestic relations
proceeding or otherwise by operation of law), pledge, encumber or otherwise
dispose of any of his or its respective Shares, (b) deposit any of his or its
respective Shares into a voting trust or enter into a voting agreement or
arrangement with respect to any such Shares or grant any proxy or power of
attorney with respect thereto which is inconsistent with this Agreement or
(c) enter into any contract, option or other arrangement or undertaking with
respect
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to the direct or indirect sale, assignment, transfer (including by merger,
testamentary disposition, interspousal disposition pursuant to a domestic
relations proceeding or otherwise by operation of law) or other disposition
of any Shares. Notwithstanding the foregoing, (i) this Section 2 shall not
apply to the Taube Shares and (ii) each of the Berman Irrevocable Trusts
shall be entitled to transfer up to 50,000 of the Berman Shares to an
exchange fund so long as each such trust instructs, and uses its reasonable
best efforts to cause, such exchange fund to vote the transferred shares in
accordance with Section 1 above.
Section 3. NO SOLICITATION. Prior to the termination of this
Agreement in accordance with its terms, each Shareholder agrees, with respect
to himself or itself, (a) that he or it will not, nor will he or it authorize
or permit any of his or its officers, directors, employees, trustees, agents
and representatives to, directly or indirectly, initiate or solicit any
inquiries or the making of any Acquisition Proposal and (b) that he or it
will notify Company and Hilton as soon as possible (and in any event within
48 hours) if any such inquiries or proposals are received by, any information
or documents is requested from, or any negotiations or discussions are sought
to be initiated or continued with, him or it or any of his or its affiliates.
Section 4. TERMINATION. This Agreement shall terminate upon
the earliest to occur of (a) the Effective Time or (b) any termination of the
Merger Agreement in accordance with the terms thereof; PROVIDED that no such
termination shall relieve any party of liability for a breach hereof prior to
termination.
Section 5. SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur in the event any provision of this Agreement
was not performed in accordance with the terms hereof and that the parties
shall be entitled to specific performance of the terms hereof, in addition to
any other remedy at law or in equity.
Section 6. MISCELLANEOUS.
(a) This Agreement constitutes the entire agreement between
the parties hereto with respect to the subject matter hereof and supersedes
all prior agreements and understandings, both written and oral, between the
parties with respect thereto. This Agreement may not be amended, modified or
rescinded except by an instrument in writing signed by each of the parties
hereto.
(b) If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law, or public
policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect. Upon such determination that
any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible to the fullest extent permitted by applicable law in a mutually
acceptable manner in order that the terms of this Agreement remain as
originally contemplated to the fullest extent possible.
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(c) This Agreement shall be governed by and construed in
accordance with the laws of the State of New York without regard to the
principles of conflicts of law thereof, except to the extent that the
provisions of the Minnesota Business Corporation Act, as amended from time to
time, shall be mandatorily applicable to this Agreement.
(d) Notwithstanding anything herein to the contrary, the
covenants and agreements set forth herein shall not prevent any Shareholder
or any of such Shareholder's designees, partners or affiliates serving on the
Board of Directors of Company from taking any action, subject to the
applicable provisions of the Merger Agreement, while acting in such capacity
as a director of Company.
(e) Notwithstanding any provisions hereof, none of the
obligations of any Shareholder under or contemplated by this Agreement shall
be an obligation of (i) any affiliate of such Shareholder, or any of such
affiliate's respective officers, directors, shareholders, limited partners,
general partners or owners, or successors or assigns or (ii) any other
Shareholder. Each Shareholder shall be the only person or entity liable with
respect to his or its obligations. Any monetary liability of a Shareholder
under this Agreement shall be satisfied solely out of the assets of such
Shareholder. Each Shareholder hereby irrevocably waives any right he or it
may have against any such officer, director, shareholder, limited partner,
general partner, owner, successor or assign identified above as a result of
the performance of the provisions under or contemplated by this Agreement.
Nothing in this Section 7(e) shall prevent Hilton or Company from obtaining
specific enforcement of the obligations of any Shareholder under this
Agreement.
(f) This Agreement may be executed in counterparts, each of which
shall be deemed an original and all of which together shall constitute one
and the same instrument.
[Signature Pages to Follow]
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed by their respective duly authorized officers as of the
date first written above.
STANLEY TAUBE,
an Individual
/s/ Stanley Taube
-------------------------------------------
Stanley Taube
S.M. TAUBE & CO., INC.
a Nevada corporation
/s/ Stanley Taube
-------------------------------------------
By: Stanley Taube
Its: President
LYLE BERMAN,
an Individual
/s/ Lyle Berman
-------------------------------------------
Lyle Berman
NEIL I. SELL,
as Trustee of Amy Berman Irrevocable Trust
dated August 9, 1989
/s/ Neil I. Sell
-------------------------------------------
Neil I. Sell
NEIL I. SELL,
as Trustee of Bradley Berman Irrevocable
Trust dated August 9, 1989
/s/ Neil I. Sell
-------------------------------------------
Neil I. Sell
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NEIL I. SELL,
as Trustee of Jessie Lynn Berman Irrevocable
Trust dated August 9, 1989
/s/ Neil I. Sell
-------------------------------------------
Neil I. Sell
NEIL I. SELL,
as Trustee of Julie Berman Irrevocable Trust
dated August 9, 1989
/s/ Neil I. Sell
-------------------------------------------
Neil I. Sell
HILTON HOTELS CORPORATION,
a Delaware corporation
/s/ Matthew J. Hart
-------------------------------------------
By: Matthew J. Hart
Its: Executive Vice President and
Chief Financial Officer
Agreed and Acknowledged:
GRAND CASINOS, INC.,
a Minnesota corporation
/s/ Lyle Berman
- - ----------------------------------
By: Lyle Berman
Its: Chairman of the Board
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