Exhibit 10.33.1.1
Execution Version
AMENDMENT NO. 1
TO THE
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
MS RESORT HOLDINGS LLC,
MS RESORT ACQUISITION LLC,
MS RESORT PURCHASER LLC,
ASHFORD SAPPHIRE ACQUISITION LLC
AND
CNL HOTELS & RESORTS, INC.
DATED AS OF FEBRUARY 21, 2007

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          THIS AMENDMENT NO. 1 TO THE AGREEMENT AND PLAN OF MERGER, dated as of
February 21, 2007 (this “Amendment”), is entered into by and among MS Resort
Holdings LLC, a Delaware limited liability company (“Parent”), MS Resort
Acquisition LLC, a Delaware limited liability company and a wholly-owned
subsidiary of Parent (“Sub”), MS Resort Purchaser LLC, a Delaware limited
liability company and wholly-owned subsidiary of Parent (“Missouri”), Ashford
Sapphire Acquisition LLC, a Delaware limited liability company (“Arizona”), and
CNL Hotels & Resorts, Inc., a Maryland corporation (the “Company”). Parent, Sub,
Missouri and Arizona are hereinafter collectively referred to as the “Buyer
Parties”.
W I T N E S S E T H:
          WHEREAS, the Buyer Parties and the Company entered into that certain
Agreement and Plan of Merger, dated as of January 18, 2007, by and among the
Buyer Parties and the Company (the “Merger Agreement”); and
          WHEREAS, the Buyer Parties and the Company desire to amend the Merger
Agreement as provided in this Amendment.
          NOW, THEREFORE, in consideration of the foregoing and for other good
and valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereto hereby agree as follows:

  1.   Amendment to Section 1.1 of the Merger Agreement. The definition of the
“Company Letter” set forth in Section 1.1 of the Merger Agreement is hereby
amended and restated in its entirety to read as follows:

““Company Letter” means the letter from the Company to the Buyer Parties dated
as of January 18, 2007 as amended by that certain amendment to the Company
Letter, dated as of February 21, 2007, which letter, as amended, relates to this
Agreement and is designated therein as the Company Letter.”
The Buyer Parties and the Company hereby agree that the amendment to the Company
Letter, dated as of February 21, 2007, shall be in the form attached hereto as
Exhibit A.

  2.   Amendment to Section 3.2(b) of the Merger Agreement. The second sentence
of Section 3.2(b) is hereby amended and restated in its entirety as follows:

“Upon surrender of a Certificate (or affidavits of loss in lieu thereof) for
cancellation to the Paying Agent, together with such letter of transmittal, duly
executed, and such other documents as may reasonably be required by the Paying
Agent or, in the case of Uncertificated Shares, at or promptly following the
receipt by the Paying Agent of a duly executed letter of transmittal and such
other documents as may be required by the Paying Agent or at such earlier time
as the Company (or, if after the Effective Time, the Surviving Entity) and
Parent shall

 

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instruct the Paying Agent, the holder of such Certificate or Uncertificated
Shares shall be entitled to receive in exchange therefor the amount of cash
(after giving effect to any required Tax withholdings as provided in
Section 3.2(g)) equal to (x) the number of Shares held by such stockholder
multiplied by (y) the Per Share Merger Consideration, and any Certificates
surrendered shall forthwith be cancelled.”

  3.   WARN Notices. The Company hereby agrees that, on or before February 23,
2007, the Company shall, at the request of Parent, cause notices in the forms
attached hereto as Exhibit B, Exhibit C and Exhibit D, and any supplemental
notices thereafter as required by WARN, to be provided to the respective parties
set forth in Exhibit B and Exhibit C and to those employees of the Company that
Parent shall identify to the Company in writing. The Company hereby agrees to
provide notices in the form set forth as Exhibit E from time to time upon two
(2) Business Days notice to those employees as Parent shall identify in writing.
The Company and the Buyer Parties acknowledge that any Change resulting from the
Company’s compliance with this Section 3 shall be excluded from any
determination as to whether a Material Adverse Effect on the Company has
occurred.     4.   Consent. Parent hereby consents to the amendment by the
Company of each of (a) the Employment Agreement and (b) the Deferred Share Award
Grant Notice for each of Thomas J. Hutchison, III, John A. Griswold and C. Brian
Strickland in the forms attached hereto as Exhibit F, Exhibit G, Exhibit H,
Exhibit I, Exhibit J and Exhibit K respectively.     5.   Employee Bonus
Program. The Company and Buyer Parties agree to implement a bonus program for
employees of the Company substantially on the terms and in the amounts set forth
on Exhibit L hereto.     6.   Defined Terms. Capitalized terms used but not
otherwise defined herein shall have the meanings ascribed to such terms in the
Merger Agreement.     7.   References to the Merger Agreement. After giving
effect to this Amendment, each reference in the Merger Agreement to “this
Agreement”, “hereof”, “hereunder” or words of like import referring to the
Merger Agreement shall refer to the Merger Agreement as amended by this
Amendment and all references in the Company Letter to “the Agreement” and “the
Merger Agreement” shall refer to the Merger Agreement as amended by this
Amendment.     8.   Construction. Except as expressly provided in this
Amendment, all references in the Merger Agreement and the Company Letter to “the
date hereof” and “the date of this Agreement” shall refer to January 18, 2007.  
  9.   Other Miscellaneous Terms. The provisions of Article XI (General
Provisions) of the Merger Agreement shall apply mutatis mutandis to this
Amendment, and to the Merger Agreement as modified by this Amendment, taken
together as a single agreement, reflecting the terms therein as modified hereby.
    10.   No Further Amendment. Except as expressly amended hereby, the Merger
Agreement, shall remain in full force and effect.

2

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     IN WITNESS WHEREOF, Parent, Sub, Missouri, Arizona and the Company have
caused this Amendment to be signed by their respective officers thereunto duly
authorized all as of the date first written above.

            MS RESORT HOLDINGS LLC
      By:   /s/ Michael Quinn         Name:   Michael Quinn        Title:   Vice
President     

     
 
  MS RESORT ACQUISITION LLC
 
   
 
  By: MS Resort Holdings LLC, its Managing
       Member

                  By:   /s/ Michael Quinn         Name:   Michael Quinn       
Title:   Vice President     

     
 
  MS RESORT PURCHASER LLC  
 
  By: MS Resort Holdings LLC, its Managing
       Member

                  By:   /s/ Michael Quinn         Name:   Michael Quinn       
Title:   Vice President     

            ASHFORD SAPPHIRE ACQUISITION LLC
      By:   /s/ David A. Brooks         Name:   David A. Brooks        Title:  
Vice President     

            CNL HOTELS & RESORTS, INC.
      /s/ Greerson G. McMullen       Name:   Greerson G. McMullen      Title:  
Executive Vice President     

3

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EXHIBIT A
AMENDMENT TO COMPANY LETTER

A-1

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EXHIBIT B
WARN NOTICE TO MAYOR OF ORLANDO
February __, 2007
VIA OVERNIGHT DELIVERY
Mayor Buddy Dyer
Post Office Box 4990
Orlando, Florida 32802-4990
     Re: CNL Hotels & Resorts, Inc.
Dear Mayor Dyer:
     As you may know, MS Resort Holdings LLC (the “Company”) is currently in the
process of purchasing CNL Hotels & Resorts, Inc. (“CNL”), located at CNL Center
II, 420 South Orange Avenue, Suite 700, Orlando, Florida 32801-3313. It is
anticipated that the sale transaction will be consummated on or about [insert
date that is 2 days after the date set for the Company stockholder vote].
     Pursuant to the Worker Adjustment and Retraining Notification Act (“WARN”),
29 U.S.C. § 2101, we are notifying you that, as a result of this transaction,
certain employees of CNL will be laid off permanently. The Company expects to
announce the initial phase of these terminations to begin on [insert date that
is sixty days from delivery of letter] or, if later, the date on which the sale
transaction is consummated. Subsequent phases of these terminations will likely
continue in approximately 30-day increments and will be completed on or about
[May 1, 2008][the first anniversary of the date on which the sale transaction is
consummated]. Bumping rights do not exist for the affected employees.
     Please see the attached list of job titles of employees who will be
affected by the sale transaction of CNL and the number of affected employees in
each job classification.
     The information provided in this notice is based upon the best information
available to CNL at this time. If you have any questions, please do not hesitate
to contact me at                      or by email at                     .
Sincerely,

B-1

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            CNL HOTELS & RESORTS, INC.
      By:           Name:           Title:      

B-2

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EXHIBIT C
WARN NOTICE TO REACT PROGRAM
February __, 2007
VIA OVERNIGHT DELIVERY
Gene Rhodes
Administrator REACT Program
MSC 229
107 E. Madison Street
Tallahassee, Florida 32399-4137
     Re: CNL Hotels & Resorts, Inc.
Dear Mr. Rhodes:
     As you may know, MS Resort Holdings LLC (the “Company”) is currently in the
process of purchasing CNL Hotels & Resorts, Inc. (“CNL”), located at CNL Center
II, 420 South Orange Avenue, Suite 700, Orlando, Florida 32801-3313. It is
anticipated that the sale transaction will be consummated on or about [insert
date that is 2 days after the date set for the Company stockholder vote]
     Pursuant to the Worker Adjustment and Retraining Notification Act (“WARN”),
29 U.S.C. § 2101, we are notifying you that, as a result of this transaction,
certain employees of CNL will be laid off permanently. The Company expects to
announce the initial phase of these terminations to begin on [insert date that
is sixty days from delivery of letter] or, if later, the date on which the sale
transaction is consummated. Subsequent phases of these terminations will likely
continue in approximately 30-day increments and will be completed on or about
[May 1, 2008][the first anniversary of the date on which the sale transaction is
consummated]. Bumping rights do not exist for the affected employees.
     Please see the attached list of job titles of employees who will be
affected by the sale transaction of CNL and the number of affected employees in
each job classification.
     The information provided in this notice is based upon the best information
available to CNL at this time. If you have any questions, please do not hesitate
to contact me at                      or by email at                     .
Sincerely,

C-1

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            CNL HOTELS & RESORTS, INC.
      By:           Name:           Title:        

C-2

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EXHIBIT D
FORM OF NOTICE FOR INITIAL SEPARATION DATE
NOTICE OF MASS LAYOFF TO AFFECTED EMPLOYEES PURSUANT TO WORKER ADJUSTMENT AND
RETRAINING NOTIFICATION (WARN) ACT
For Delivery Via Certified Mail, Return Receipt Requested

         
To:
       
 
       
 
       
Date:
       
 
       

     As you may be aware, MS Resort Holdings LLC (the “Company”) is currently in
the process of purchasing CNL Hotels & Resorts, Inc. (“CNL”), located at CNL
Center II, 420 South Orange Avenue, Suite 700, Orlando, Florida 32801-3313. It
is anticipated that the sale transaction will be consummated on or about [insert
date that is 2 days after the date set for the Company stockholder vote]
     As a result of this sale transaction, it is inevitable that certain
employees of CNL will be laid off permanently. Bumping rights do not exist for
the affected employees. The Company expects to announce the initial phase of
these terminations to begin on [insert date that is sixty days from delivery of
letter] or, if later, the date on which the sale transaction is consummated.
     Your anticipated separation date shall be on or about [insert date that is
sixty days from delivery of letter] or, if later, the date on which the sale
transaction is consummated.
     This notice is provided to you pursuant to the Worker Adjustment and
Retraining Notification Act (“WARN”), 29 U.S.C. § 2101, and is based upon the
best information available to CNL at the time.
     If you have any questions, please contact me at                      or via
email at                     .
CNL HOTELS & RESORTS, INC.

         
By:
       
 
       
 
  Name:    
 
  Title:    

D-1

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EXHIBIT E
FORM OF NOTICE FOR FUTURE SEPARATION DATE
NOTICE OF MASS LAYOFF TO AFFECTED EMPLOYEES PURSUANT TO WORKER ADJUSTMENT AND
RETRAINING NOTIFICATION (WARN) ACT
For Delivery Via Certified Mail, Return Receipt Requested

         
To:
       
 
       
 
       
Date:
       
 
       

     As you may be aware, MS Resort Holdings LLC (the “Company”) is currently in
the process of purchasing CNL Hotels & Resorts, Inc. (“CNL”), located at CNL
Center II, 420 South Orange Avenue, Suite 700, Orlando, Florida 32801-3313. It
is anticipated that the sale transaction will be consummated on or about [insert
date that is 2 days after the date set for the Company stockholder vote].
     As a result of this sale transaction, it is inevitable that certain
employees of CNL will be laid off permanently. Bumping rights do not exist for
the affected employees. The Company expects to announce the initial phase of
these terminations to begin on [insert date that is sixty days from delivery of
letter] or, if later, the date on which the sale transaction is consummated.
     Your anticipated separation date shall be [___] days following the later of
[insert date that is sixty days from delivery of letter] and the consummation of
the sale transaction.
     This notice is provided to you pursuant to the Worker Adjustment and
Retraining Notification Act (“WARN”), 29 U.S.C. § 2101, and is based upon the
best information available to CNL at the time.
     If you have any questions, please contact me at                      or via
email at                     .
CNL HOTELS & RESORTS, INC.

         
By:
       
 
       
 
  Name:    
 
  Title:    

E-1

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EXHIBIT F
AMENDMENT TO EMPLOYMENT AGREEMENT — THOMAS J. HUTCHISON, III

F-1

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EXHIBIT G
AMENDMENT TO DEFERRED SHARE AWARD
GRANT NOTICE — THOMAS J. HUTCHISON, III

G-1

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EXHIBIT H
AMENDMENT TO EMPLOYMENT AGREEMENT — JOHN A. GRISWOLD

H-1

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EXHIBIT I
AMENDMENT TO DEFERRED SHARE AWARD
GRANT NOTICE — JOHN A. GRISWOLD

I-1

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EXHIBIT J
AMENDMENT TO EMPLOYMENT AGREEMENT — C. BRIAN STRICKLAND

J-1

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EXHIBIT K
AMENDMENT TO DEFERRED SHARE AWARD
GRANT NOTICE — C. BRIAN STRICKLAND

K-1

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EXHIBIT L
BONUS PROGRAM
     The Bonus Program will be implemented substantially on the terms set forth
in the attached form of Fact Sheet. The aggregate amount paid to all employees
for the “Goodwill Bonus” as described on the Fact Sheet shall not exceed
$7,196,875.

L-1