EXHIBIT 2.10
ASSET PURCHASE AGREEMENT
dated as of October 17, 2000
by and among
AMERISTAR CASINO ST. XXXXXXX, INC.,
a Missouri corporation
("Purchaser"),
AMERISTAR CASINOS, INC.,
a Nevada corporation
("ACI"),
ST. XXXXXXX RIVERFRONT Station, INC.,
a Missouri corporation
(the "Company"),
and
Station Casinos, Inc.,
a Nevada corporation
("Parent"),
with respect to
the assets of
ST. XXXXXXX RIVERFRONT Station, INC.,
a Missouri corporation
TABLE OF CONTENTS
This Table of Contents is not part of the Agreement to which
it is attached but is inserted for convenience only.
PAGE
NO.
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ASSET PURCHASE AGREEMENT..........................................................................................1
ARTICLE I SALE OF ASSETS AND CLOSING..............................................................................1
1.01 Assets................................................................................................1
1.02 Liabilities...........................................................................................6
1.03 Purchase Price; Allocation............................................................................8
1.04 Closing...............................................................................................8
1.05 Determination of Surplus or Deficiency; Post-Closing Adjustment.......................................9
1.06 Prorations...........................................................................................10
1.07 Further Assurances; Post-Closing Cooperation.........................................................11
1.08 Third-Party Consents; ACI's Gaming Compliance Program................................................12
1.09 Insurance Proceeds...................................................................................13
ARTICLE IIREPRESENTATIONS AND WARRANTIES OF THE COMPANY AND PARENT...............................................13
2.01 Corporate Existence..................................................................................13
2.02 Authority............................................................................................13
2.03 No Conflicts.........................................................................................14
2.04 Governmental Approvals and Filings...................................................................14
2.05 Financial Statements and Condition...................................................................15
2.06 Taxes................................................................................................15
2.07 Legal Proceedings....................................................................................15
2.08 Compliance With Laws and Orders......................................................................15
2.09 Benefit Plans; ERISA; Labor Matters..................................................................16
2.10 Real Property........................................................................................17
2.11 Tangible Personal Property...........................................................................18
2.12 Contracts............................................................................................18
2.13 Licenses.............................................................................................19
2.14 Affiliate Transactions...............................................................................19
2.15 Environmental Matters................................................................................19
2.16 Labor Matters........................................................................................20
2.17 Brokers..............................................................................................20
2.18 Absence of Certain Changes...........................................................................21
2.19 Sufficiency of and Title to the Assets...............................................................21
2.20 Insurance............................................................................................21
ARTICLE III REPRESENTATIONS AND WARRANTIES OF PURCHASER and aci..................................................22
3.01 Existence............................................................................................22
3.02 Authority............................................................................................22
3.03 No Conflicts.........................................................................................22
3.04 Governmental Approvals and Filings...................................................................23
3.05 Legal Proceedings....................................................................................23
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3.06 Brokers..............................................................................................23
3.07 Financing............................................................................................23
3.08 Purchaser's Gaming Licenses..........................................................................23
ARTICLE IV COVENANTS OF THE COMPANY AND PARENT...................................................................23
4.01 Regulatory and Other Approvals.......................................................................24
4.02 HSR Filings..........................................................................................24
4.03 Investigation by Purchaser...........................................................................24
4.04 Conduct of Business..................................................................................25
4.05 Certain Restrictions.................................................................................25
4.06 Transition Period....................................................................................26
4.07 No Solicitation......................................................................................27
4.08 Title Insurance......................................................................................27
4.09 ACI's Gaming Compliance Program......................................................................29
4.10 Fulfillment of Conditions............................................................................29
4.11 Noncompetition.......................................................................................30
4.12 No Solicitation......................................................................................31
ARTICLE V COVENANTS OF PURCHASER.................................................................................31
5.01 Regulatory and Other Approvals.......................................................................31
5.02 HSR Filings..........................................................................................32
5.03 Investigation by the Company.........................................................................32
5.04 No Solicitation......................................................................................32
5.05 Collection of Gaming Chips and Tokens................................................................32
5.06 Valet Parking........................................................................................33
5.07 Return of Books and Records..........................................................................33
5.08 Use of Transferred Intellectual Property.............................................................33
5.09 Fulfillment of Conditions............................................................................33
ARTICLE VI CONDITIONS TO OBLIGATIONS OF PURCHASER................................................................33
6.01 Representations and Warranties.......................................................................33
6.02 Performance..........................................................................................34
6.03 Officers'Certificates................................................................................34
6.04 Orders and Laws......................................................................................34
6.05 Regulatory Consents and Approvals....................................................................34
6.06 Consummation of Related Transaction..................................................................34
6.07 Deliveries...........................................................................................34
6.08 Title Insurance and Environmental Reports............................................................34
6.09 Consents.............................................................................................34
6.10 Absence of Material Adverse Effect...................................................................35
ARTICLE VII CONDITIONS TO OBLIGATIONS OF THE COMPANY.............................................................35
7.01 Representations and Warranties.......................................................................35
7.02 Performance..........................................................................................35
7.03 Officers'Certificates................................................................................35
7.04 Orders and Laws......................................................................................35
7.05 Regulatory Consents and Approvals....................................................................35
7.06 Consummation of Related Transaction..................................................................36
7.07 Deliveries...........................................................................................36
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7.08 Required Consents....................................................................................36
ARTICLE VIII TAX MATTERS AND POST-CLOSING TAXES..................................................................36
8.01 Transfer Taxes and Transfer Fees.....................................................................36
8.02 Tax Indemnification..................................................................................36
8.03 Tax Cooperation......................................................................................37
8.04 Notification of Proceedings; Control.................................................................37
ARTICLE IX EMPLOYEE BENEFITS MATTERS.............................................................................37
9.01 Offer of Employment..................................................................................37
9.02 Welfare Plans -- Claims Incurred; Pre-Existing Conditions............................................38
9.03 Vacation.............................................................................................38
9.04 Service Credit.......................................................................................38
9.05 Company's Benefit Plans..............................................................................38
9.06 COBRA Matters........................................................................................39
ARTICLE X SURVIVAL OF REPRESENTATIONS............................................................................39
10.01 Survival of Representations, Warranties, Covenants and Agreements....................................39
10.02 No Other Representations.............................................................................39
ARTICLE XI INDEMNIFICATION.......................................................................................39
11.01 Other Indemnification................................................................................39
11.02 Method of Asserting Claim............................................................................40
11.03 Exclusivity..........................................................................................43
ARTICLE XII TERMINATION..........................................................................................44
12.01 Termination..........................................................................................44
12.02 Effect of Termination................................................................................44
ARTICLE XIII DEFINITIONS.........................................................................................45
13.01 Defined Terms........................................................................................45
13.02 Construction of Certain Terms and Phrases............................................................53
ARTICLE XIV MISCELLANEOUS........................................................................................53
14.01 Notices..............................................................................................53
14.02 Entire Agreement.....................................................................................55
14.03 Expenses.............................................................................................55
14.04 Public Announcements.................................................................................55
14.05 Waiver...............................................................................................55
14.06 Amendment............................................................................................55
14.07 Confidentiality......................................................................................55
14.08 No Third Party Beneficiary...........................................................................56
14.09 No Assignment; Binding Effect........................................................................56
14.10 Headings.............................................................................................56
14.11 Invalid Provisions...................................................................................57
14.12 Consent to Jurisdiction and Venue....................................................................57
14.13 Governing Law........................................................................................57
14.14 Attorney's Fees......................................................................................57
14.15 Time of the Essence..................................................................................57
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14.16 Counterparts.........................................................................................57
ARTICLE XV GUARANTEES............................................................................................57
15.01 Guarantee of the Company's Obligations...............................................................57
15.02 Guarantee of Purchaser's Obligations.................................................................58
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SCHEDULES
Section 1.01(a)(i)..............................................................................Owned Real Property
Section 1.01(a)(ii)............................................................................Real Property Leases
Section 1.01(a)(iii)...........................................................Planned Expansion Facility Materials
Section 1.01(a)(v).........................................................................Personal Property Leases
Section 1.01(a)(vi)..............................................................................Business Contracts
Section 1.01(a)(viii).............................................................................Business Licenses
Section 1.01(a)(ix)............................................................................Vehicles and Vessels
Section 1.01(a)(xiii).............................................................Transferred Intellectual Property
Section 1.01(b)(xiv)..............................................................................Excluded Contacts
Section 2.03..............................................................................................Conflicts
Section 2.04.................................................................................Governmental Approvals
Section 2.05(a)................................................................................Financial Statements
Section 2.05(b)................................................................................Changes in Condition
Section 2.06(a)...........................................................................................Tax Liens
Section 2.06(b)............................................................................Compliance with Tax Laws
Section 2.07......................................................................................Legal Proceedings
Section 2.08........................................................................Compliance with Laws and Orders
Section 2.09(a).......................................................................................Benefit Plans
Section 2.09(e).....................................................................................Benefit Accrual
Section 2.09(f)....................................................................Collective Bargaining Agreements
Section 2.09(g)................................................................................Terminated Employees
Section 2.10(a).......................................................................................Real Property
Section 2.10(b)...............................................................................................Liens
Section 2.12(a)...........................................................................................Contracts
Section 2.12(b).................................................................................Contract Violations
Section 2.13...............................................................................................Licenses
Section 2.15..................................................................................Environmental Matters
Section 2.18........................................................................................Certain Changes
Section 2.20..............................................................................................Insurance
Section 3.04.....................................................................Purchaser's Governmental Approvals
Section 3.08............................................................................Purchaser's Gaming Licenses
Section 6.09......................................................................................Required Consents
Section 7.08.......................................................................Parent/Company Required Consents
EXHIBITS
Exhibit A.......................................................................General Assignment and Xxxx of Sale
Exhibit B......................................................................................Assumption Agreement
Exhibit C......................................................................Officer's Certificate of the Company
Exhibit D....................................................................Secretary's Certificate of the Company
Exhibit E-1......................................................................Officer's Certificate of Purchaser
Exhibit E-2............................................................................Officer's Certificate of ACI
Exhibit F-1....................................................................Secretary's Certificate of Purchaser
Exhibit F-2..........................................................................Secretary's Certificate of ACI
Exhibit G.....................................................................................Intentionally Omitted
Exhibit H............................................................................Net Current Assets Calculation
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ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT dated as of October 17, 2000
(the "EFFECTIVE DATE") is made and entered into by and among Ameristar Casino
St. Xxxxxxx, Inc., a Missouri corporation ("PURCHASER"), Ameristar Casinos,
Inc., a Nevada corporation ("ACI"), St. Xxxxxxx Riverfront Station Corporation,
a Missouri corporation (the "COMPANY"), and Station Casinos, Inc., a Nevada
corporation ("PARENT"). Capitalized terms not otherwise defined herein have the
meanings set forth in SECTION 13.01.
WHEREAS, the Company owns and operates that certain riverboat
gaming and entertainment facility known as "Station Casino St. Xxxxxxx" located
in St. Xxxxxxx, Missouri (the "BUSINESS"); and
WHEREAS, Parent and the Company have entered into that certain
Asset Purchase Agreement dated as of July 19, 2000 with SC Opco, LLC, a Delaware
limited liability company (the "JULY AGREEMENT") pursuant to which the Company
has agreed to sell the Business to SC Opco, LLC; and
WHEREAS, the Company desires to enter into an agreement to
sell, transfer and assign to Purchaser, and Purchaser desires to enter into an
agreement to purchase and acquire from the Company, certain of the assets of the
Company relating to the operation of the Business, and in connection therewith,
Purchaser has agreed to assume certain of the liabilities of the Company
relating to the Business, all on the terms set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements set forth in this Agreement, and for other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
ARTICLE I
SALE OF ASSETS AND CLOSING
1.01 ASSETS.
(a) ASSETS TRANSFERRED. On the terms and subject to the
conditions set forth in this Agreement, the Company will sell, transfer, convey,
assign and deliver to Purchaser, and Purchaser will purchase and pay for, at the
Closing, all of the Company's right, title and interest in, and to all of the
properties, assets and rights of every nature, kind and description, tangible
and intangible (including goodwill), whether real, personal or mixed, whether
accrued, contingent or otherwise, and whether now existing or hereafter acquired
(other than the Excluded Assets) used primarily in connection with the Business,
except as otherwise provided in SECTION 1.01(b), as the same shall exist on the
Closing Date including but not limited to such properties, assets and rights in
the following categories (collectively with any proceeds and awards referred to
in SECTION 1.09, the "ASSETS"):
(i) REAL PROPERTY. The real property described in SECTION
1.01(a)(i) OF THE DISCLOSURE SCHEDULE, and all of the rights arising
out of the ownership thereof or appurtenant thereto (the "OWNED REAL
PROPERTY"), together with all buildings, structures, facilities,
fixtures and other improvements thereto (the "IMPROVEMENTS") and all
transferable licenses, permits, approvals and qualifications relating
to any Owned Real Property issued to the Company by any Governmental or
Regulatory Authority;
(ii) REAL PROPERTY LEASES AND AGREEMENTS. Subject to SECTION
1.08, (A) the leases, subleases and licenses of real property and
related guarantees described in SECTION 1.01(a)(ii)(A) OF THE
DISCLOSURE SCHEDULE as to which the Company is the lessor, sublessor or
licensor together with any agreements for use or occupancy of hotel
rooms, banquet facilities or meeting rooms, and (B) the leases and
subleases of real property described in SECTION 1.01(a)(ii)(B) OF THE
DISCLOSURE SCHEDULE as to which the Company is the lessee, sublessee or
licensee (including the land and buildings, improvements and structures
and all appurtenances belonging thereto) (such real property, the
"LEASED REAL PROPERTY"; and, together with the Owned Real Property, the
"REAL PROPERTY"); and all other rights, subleases, licenses, permits,
deposits and profits appurtenant to or related to such leases,
subleases and licenses described in this SECTION 1.01(a)(ii) (the
leases and agreements described in subclauses (A) and (B), the "REAL
PROPERTY LEASES") and all of the Company's interest (including the land
and buildings, improvements and structures located thereon and all
appurtenances belonging thereto) in those certain leases, subleases and
licenses as to which the Company is the lessee, sublessee or licensee
as described in SECTION 1.01(a)(ii)(B) OF THE DISCLOSURE SCHEDULE;
(iii) ACCOUNTS RECEIVABLE. All accounts receivable of the
Company existing on the Closing Date and calculated as set forth on the
schedule attached hereto as EXHIBIT H (the "ACCOUNTS Receivable");
(iv) TANGIBLE PERSONAL PROPERTY. All furniture, fixtures,
equipment, machinery, consumables, inventory, merchandise, liquor,
food, supplies, spare and replacement parts and other tangible personal
property (including, without limitation, all Gaming Devices which shall
be transferred through a Licensed Supplier in accordance with the rules
and regulations of the Missouri Gaming Commission (the "COMMISSION"))
used primarily in the conduct of the Business (the "TANGIBLE PERSONAL
PROPERTY") and all materials and items relating to the planned
expansion facilities and listed in SECTION 1.01(a)(iii) OF THE
DISCLOSURE SCHEDULE and all plans, drawings, specifications and models
relating to the planned expansion of the physical facilities
constituting the Business (the "Expansion Materials");
(v) PERSONAL PROPERTY LEASES. Subject to SECTION 1.08, (A) the
leases or subleases of Tangible Personal Property described in SECTION
1.01(a)(v)(A) OF THE DISCLOSURE SCHEDULE as to which the Company is the
lessor or sublessor and (B) the leases of Tangible Personal Property
described in SECTION 1.01(a)(v)(B) OF THE DISCLOSURE SCHEDULE as to
which the Company is the lessee or sublessee, together with any options
to purchase the underlying property (the leases and subleases described
in SUBCLAUSES (A) and (B), the "PERSONAL PROPERTY LEASES");
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(vi) BUSINESS CONTRACTS. Subject to SECTION 1.08, all
Contracts (other than the Real Property Leases and the Personal
Property Leases) to which the Company is a party, the terms of which
permit assignment of the Company's interest therein or with respect to
which all necessary consents to assignment of the Company's interest
therein have been obtained prior to the Closing, and which are utilized
primarily in the conduct of the Business, including, without
limitation, Contracts described in SECTION 1.01(a)(vi) OF THE
DISCLOSURE SCHEDULE and Contracts relating to suppliers, sales
representatives, distributors, purchase orders, marketing arrangements
and manufacturing arrangements (the "BUSINESS CONTRACTS");
(vii) PREPAID EXPENSES. All prepaid expenses of the Company
existing on the Closing Date and calculated as set forth on the
schedule attached hereto as EXHIBIT H (the "PREPAID EXPENSES");
(viii) LICENSES. To the extent transfer is permitted under
applicable Laws and pursuant to the terms of such Licenses and subject
to SECTION 1.08, Licenses (including applications therefor) issued
primarily in connection with the conduct of the Business, including,
without limitation, the Licenses listed in SECTION 1.01(a)(viii) OF THE
DISCLOSURE SCHEDULE (the "BUSINESS LICENSES");
(ix) VEHICLES AND VESSELS. All motor vehicles, boats and
barges and related docking facilities owned or leased by the Company
and used primarily in the conduct of the Business, all of which are
listed in SECTION 1.01(a)(ix) OF THE DISCLOSURE SCHEDULE (the "VEHICLES
AND VESSELS");
(x) SECURITY DEPOSITS. All security deposits deposited by or
on behalf of the Company as lessee or sublessee under the Real Property
Leases and the Personal Property Leases existing on the Closing Date
and calculated as set forth on the schedule attached hereto as EXHIBIT
H (the "LESSEE SECURITY DEPOSITS");
(xi) OTHER RIGHTS. All third party guarantees, warranties,
indemnities and similar rights in favor of the Company with respect to
any Asset, other than claims and recoveries under litigation of the
Company against third parties (including, without limitation, the
Company's pending insurance claim relating to the sinking of the
Company's tent barge) arising out of or relating to events or
conditions existing or occurring prior to the Transfer Time;
(xii) HOTEL AND ENTERTAINMENT RESERVATIONS. All security
deposits or payments made to the Company prior to the Transfer Time
with regard to any hotel and entertainment reservations for events
following the Transfer Time;
(xiii) INTELLECTUAL PROPERTY. All of the Company's licensed
products or processes, patents, copyrights, trademarks, service marks,
service names, designs, know-how, processes, trade secrets, inventions,
and other proprietary data (including, without limitation, all customer
lists) used exclusively in the Business or exclusively in connection
with the Assets (other than the trade names and logos described in
SECTION
3
1.01(b)(ix)) (the "TRANSFERRED INTELLECTUAL PROPERTY"), which
Transferred Intellectual Property is listed in SECTION 1.01(a)(xiii) OF
THE DISCLOSURE SCHEDULE; and
(xiv) BOOKS AND RECORDS. All Books and Records used primarily
in the conduct of the Business or otherwise relating primarily to the
Assets (including, without limitation, customer lists and customer data
bases relating primarily to the Business (the "BUSINESS CUSTOMER
LISTS"), all Books and Records required by the Commission to be
maintained at the Business, other than the Excluded Books and Records
(the "BUSINESS BOOKS AND RECORDS").
To the extent any of the Business Books and Records are items
susceptible to duplication and are either (x) used in connection with any of the
Company's or its Affiliates' businesses other than the Business or (y) are
required by Law to be retained by the Company or its Affiliates, the Company may
deliver photostatic copies or other reproductions from which, in the case of
Business Books and Records referred to in clause (x), information solely
concerning the Company's businesses other than the Business has been deleted.
Subject to the terms and conditions hereof, at the Closing,
the Assets shall be transferred or otherwise conveyed to Purchaser free and
clear of all Liabilities, obligations, liens and encumbrances excepting only
Assumed Liabilities and Permitted Liens which shall be payable by Purchaser only
to the extent they are Assumed Liabilities.
(b) EXCLUDED ASSETS. Notwithstanding anything in this
Agreement to the contrary, the following assets and properties of the Company
(the "EXCLUDED ASSETS") shall be excluded from and shall not constitute Assets:
(i) CASH. All cash (including checks received prior to the
Transfer Time, whether or not deposited or cleared prior to the
Transfer Time) including, without limitation, cage cash, slot fill,
drop boxes, valet register, commercial paper, certificates of deposit
and other bank deposits, treasury bills and other cash equivalents;
(ii) MEMBERSHIP INTERESTS. All of the Company's membership
interests in Front Street Station, LLC;
(iii) INSURANCE. Subject to SECTION 1.09, life insurance
policies of officers and other employees of the Company and all other
insurance policies relating to the operation of the Business;
(iv) EMPLOYEE BENEFIT PLANS. All assets owned or held by or
under any Benefit Plans including assets held in trust or insurance
contracts for the benefit of Benefit Plan participants or
beneficiaries;
(v) TAX REFUNDS. All refunds or credits, if any, of Taxes due
to or from the Company by reason of its ownership of the Assets or
operation of the Business to the extent attributable to any time or
period ending at or prior to the Transfer Time;
(vi) EXCLUDED BOOKS AND RECORDS. The minute books, stock
transfer books and corporate seal of the Company and any other Books
and Records relating primarily to
4
the Excluded Assets or the Retained Liabilities except for the Business
Customer Lists and such Books and Records required by the Commission to
be maintained at the Business (the "EXCLUDED BOOKS AND RECORDS");
(vii) LITIGATION CLAIMS. All rights (including
indemnification) and claims and recoveries under litigation of the
Company against third parties (other than rights, claims and recoveries
acquired by Purchaser pursuant to SECTION 1.01(a)(xi)), including,
without limitation, the Company's pending insurance claim relating to
the sinking of the Company's tent barge, arising out of or relating to
events prior to the Transfer Time;
(viii) EXCLUDED OBLIGATIONS. The rights of the Company in, to
and under all Contracts of any nature, the obligations of the Company
under which expressly are not assumed by Purchaser pursuant to SECTION
1.02(b);
(ix) TRADE NAMES AND LOGOS. All of the Company's right, title
and interest in, to and under the names "Station Casinos, Inc.",
"Station Casino St. Xxxxxxx", "The Feast", and "Boarding Pass Players
Program", including any derivative names and related marks, designs or
logos, except for the Transferred Intellectual Property;
(x) GAMING CHIPS AND TOKENS. All of the Company's gaming chips
and tokens, including, without limitation, all (A) Gaming Device tokens
not currently in circulation and (B) "reserve" chips, if any, not
currently in circulation, except that at Purchaser's written election
made at any time prior to the Closing Date (which election shall be
subject to the prior approval of the Commission), such chips and tokens
may be acquired by Purchaser at the Closing without further
consideration;
(xi) ST. XXXXXXX AGREEMENT. The Company's rights under the
Agreement for Property Acquisitions, dated September 22, 1999 between
the Company and the City of St. Xxxxxxx, Missouri;
(xii) INTELLECTUAL PROPERTY. All trade names, marks, designs,
logos, domain names and websites other than the Transferred
Intellectual Property;
(xiii) RIGHTS UNDER THIS AGREEMENT. The Company's rights under
this Agreement and the July Agreement;
(xiv) SIGNS. All of the Company's signs containing any trade
name, xxxx, design or logo described in clause (ix) above, which
Purchaser shall, at Purchaser's sole cost and expense and using
reasonable care, not later than promptly following the expiration of
any period that Purchaser is permitted to use such names, marks,
designs or logos pursuant to SECTION 4.06 hereof, remove from the Real
Property and Improvements thereto and place in a reasonably accessible
location on the Real Property for prompt retrieval by the Company,
together with all of the Company's right, title and interest therein,
and as promptly as practicable, notify the Company and Parent that such
signs have been removed and as to the location of such signs; PROVIDED,
HOWEVER, that other than as expressly provided herein, Purchaser shall
have no liability to the Company arising out of or resulting from
Purchaser's performance of its removal, storage or other obligations
with respect to such signs;
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(xv) EXCLUDED CONTRACTS. The Administrative Services Agreement
between the Company and Parent; and
(xvi) THE EXCLUDED REAL PROPERTY. The Real Property described
in SECTION 1.01(b)(xvi) OF THE DISCLOSURE SCHEDULE.
1.02 LIABILITIES.
(a) ASSUMED LIABILITIES. In connection with the sale,
transfer, conveyance, assignment and delivery of the Assets pursuant to this
Agreement, on the terms and subject to the conditions set forth in this
Agreement, Purchaser shall assume as of the Transfer Time and shall pay, perform
and discharge when due the following Liabilities of the Company, in each case to
the extent arising out of or relating to the Business or the Assets (x) in the
case of items listed in SUBSECTIONS (i), (iii) AND (iv) below, as the same shall
accrue after the Transfer Time and (y) in the case of items listed in
subsections (ii) and (v) through (ix) below, as the same shall exist at the
Transfer Time (collectively, the "ASSUMED LIABILITIES"), and no other
Liabilities:
(i) REAL PROPERTY LEASE OBLIGATIONS. Subject to the provisions
of SECTION 1.08, all obligations of the Company under the Real Property
Leases;
(ii) ACCOUNTS PAYABLE. All obligations of the Company with
respect to accounts payable outstanding on the Closing Date and
calculated as set forth on the Schedule attached hereto as EXHIBIT H,
but excluding any Liability owed by the Company to any Affiliate of the
Company ("ACCOUNTS PAYABLE");
(iii) PERSONAL PROPERTY LEASE OBLIGATIONS. Subject to the
provisions of SECTION 1.08, all obligations of the Company under the
Personal Property Leases;
(iv) OBLIGATIONS UNDER CONTRACTS AND LICENSES. Subject to the
provisions of SECTION 1.08, all obligations of the Company under the
Business Contracts and Business Licenses that constitute Assets;
(v) ACCRUED EXPENSES. All obligations of the Company with
respect to accrued expenses outstanding on the Closing Date and
calculated as set forth on EXHIBIT H attached hereto ("ACCRUED
EXPENSES");
(vi) RETURNED GOODS. All obligations of the Company for
replacement of, or refund for, damaged, defective or returned goods, to
the extent such goods are subject to full return privileges from the
supplier thereof;
(vii) SECURITY DEPOSITS. All outstanding obligations of the
Company on the Closing Date with respect to any security deposit held
by the Company as lessor or sublessor under the Real Property Leases or
Personal Property Leases calculated as set forth on EXHIBIT H attached
hereto (the "LESSOR SECURITY DEPOSITS");
(viii) PROGRESSIVE METERS. All outstanding obligations of the
Company on the Closing Date with respect to any progressive meter on
any Gaming Device calculated as set forth on EXHIBIT H attached hereto;
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(ix) RESERVATIONS. All obligations of the Company with respect
to entertainment reservations; and
(x) POST-CLOSING LIABILITIES. All Liabilities of the Business
(other than Retained Liabilities) to the extent (A) resulting from
events or conditions occurring following the Transfer Time or (B)
arising out of the Assets and occurring after the Transfer Time.
(b) RETAINED LIABILITIES. All Liabilities of the Company other
than Assumed Liabilities (the "RETAINED LIABILITIES") shall be retained and
paid, performed and discharged when due by the Company and Parent (PROVIDED,
that the Company shall have the ability to contest, in good faith, any such
claim of liability asserted in respect thereof by any Person other than
Purchaser and its Affiliates, so long as such contest does not result in a Lien
upon any of the Assets):
(i) except to the extent any such liability is reflected on
the Closing Date Balance Sheet as a current liability of the Business,
any loss or liability of the Company of any nature or description,
whether liquidated or contingent, to the extent (a) resulting from
events or conditions which occurred or existed prior to the Transfer
Time, or (b) arising out of or relating to the Excluded Assets
(including those items identified as Retained Liabilities in SECTION
1.08);
(ii) any loss or liability relating to current or former
employees of the Business (and their eligible dependents and
beneficiaries), including with respect to employment or Benefit Plans,
which accrued on or prior to the Transfer Time, except to the extent
that such liability is reflected on the Closing Balance Sheet as a
current liability of the Business;
(iii) all Liabilities with respect to gaming chips and tokens
issued by the Company (but not progressive meters), except as provided
otherwise herein;
(iv) all Liabilities related to Benefit Plans, except to the
extent that such liability is reflected on the Closing Balance Sheet as
a current liability of the Business;
(v) all Indebtedness (other than current accounts payable or
accrued expenses of the Company incurred or accrued in the ordinary
course of business, but only to the extent that the accrual for such
payables and expenses has been properly reflected on the Closing
Balance Sheet, and other than to the extent arising following the
Transfer Time under Contracts that constitute Assets);
(vi) any Liability, whether currently in existence or arising
hereafter, owed by the Company to any of its Affiliates;
(vii) all Liabilities related to any fines or penalties
imposed against the Company (or with respect to the Business or any
Asset) by any Governmental or Regulatory Authority (including, without
limitation, the Commission) prior to the Transfer Time; and
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(viii) all other Liabilities of the Company other than the
Assumed Liabilities.
1.03 PURCHASE PRICE; ALLOCATION.
(a) PURCHASE PRICE. Subject to the adjustments set forth in
SECTION 1.05, the aggregate purchase price for the Assets shall be equal to One
Hundred Sixty Million Dollars ($160,000,000) plus the amount of any Surplus or
minus the amount of any Deficiency, in each case, as determined in accordance
with SECTION 1.05 (the "PURCHASE PRICE"). Upon Closing, the Purchase Price shall
be payable in immediately available United States funds at the Closing in the
manner provided in SECTION 1.04.
(b) ALLOCATION OF PURCHASE PRICE. Purchaser and the Company
shall negotiate in good faith prior to the Closing Date and determine the
allocation of the consideration paid by Purchaser for the Assets and the
covenant not to compete contained in SECTION 4.11 hereof. Purchaser and the
Company each agrees (i) that any such allocation shall be consistent with the
requirements of Section 1060 of the Code and the regulations thereunder, (ii) to
complete jointly and to file separately Form 8594 with its Federal income Tax
Return consistent with such allocation for the tax year in which the Closing
Date occurs and (iii) that no party will take a position on any income, transfer
or gains Tax Return, before any Governmental or Regulatory Authority charged
with the collection of any such Tax or in any judicial proceeding, that is in
any manner inconsistent with the terms of any such allocation without the
consent of the other party.
1.04 CLOSING. The Closing will take place at the offices of
Milbank, Tweed, Xxxxxx & XxXxxx LLP, 601 South Xxxxxxxx Street, 31st Floor, Los
Angeles, California, or at such other place as Purchaser and the Company
mutually agree, at 10:00 A.M. local time and shall be deemed to occur at 6:00
A.M., Central time, on the day immediately after the Closing Date (the "TRANSFER
TIME"). At the Closing, Purchaser will pay the Estimated Purchase Price by wire
transfer of immediately available funds to such accounts as the Company may
reasonably direct by written notice delivered to Purchaser at least two (2)
Business Days before the Closing Date. Simultaneously, (a) the Company will
assign and transfer to Purchaser all of its right, title and interest in and to
the Assets (free and clear of all Liens, other than Permitted Liens) by delivery
of (i) a General Assignment and Xxxx of Sale substantially in the form of
EXHIBIT A hereto (the "GENERAL ASSIGNMENT"), duly executed by the Company, (ii)
general warranty deeds in proper statutory form for recording and otherwise in
form and substance reasonably satisfactory to Purchaser conveying title to the
Owned Real Property and (iii) such other good and sufficient instruments of
conveyance, assignment and transfer, in form and substance reasonably acceptable
to Purchaser's counsel, as shall be effective to vest in Purchaser good title to
the Assets (the General Assignment and the other instruments referred to in
clauses (ii) and (iii) being collectively referred to herein as the "ASSIGNMENT
INSTRUMENTS"), and (b) Purchaser will assume from the Company the due payment,
performance and discharge of the Assumed Liabilities by delivery of (i) an
Assumption Agreement substantially in the form of EXHIBIT B hereto (the
"ASSUMPTION AGREEMENT"), duly executed by Purchaser, and (ii) such other good
and sufficient instruments of assumption, in form and substance reasonably
acceptable to the Company's counsel, as shall be effective to cause Purchaser to
assume the Assumed Liabilities as and to the extent provided in SECTION 1.02(a)
(the Assumption Agreement and such other instruments referred to in clause (ii)
being collectively referred to herein as the "ASSUMPTION
8
INSTRUMENTS"). At the Closing, there shall also be delivered to the Company and
Purchaser the certificates and other contracts, documents and instruments
required to be delivered under ARTICLES VI and VII.
1.05 DETERMINATION OF SURPLUS OR DEFICIENCY; POST-CLOSING
ADJUSTMENT.
(a) On or before the seventh (7th) Business Day preceding the
Closing Date, the Company shall, and Parent shall cause the Company to, prepare
and deliver to Purchaser an interim balance sheet (the "ESTIMATED CLOSING
BALANCE SHEET") of the Company as of the close of business on the final day of
the calendar month immediately preceding the calendar month during which the
Closing Date occurs (the "TEST MONTH"), together with a statement of the
Company's Net Current Assets as of such date calculated in a manner consistent
with the calculation set forth on EXHIBIT H attached hereto; provided that if
the Closing Date occurs within the first seven (7) Business Days of a calendar
month, the Estimated Closing Balance Sheet shall be as of the close of business
on the final day of the second calendar month immediately preceding the calendar
month during which the Closing Date occurs (in such case, the "Test Month"). The
Estimated Closing Balance Sheet shall be accompanied by a certificate of the
Chief Financial Officer of the Company to the effect that the Estimated Closing
Balance Sheet presents fairly, in accordance with GAAP and the accounting
practices of the Company applied on a consistent basis, the financial condition
of the Company as of the close of business on the last day of the Test Month.
The amount of Net Current Assets set forth in the Estimated Closing Balance
Sheet shall be final and binding for purposes of determining the amount of any
Surplus or Deficiency used in calculating the Purchase Price (the "ESTIMATED
PURCHASE PRICE"), unless Purchaser delivers a good faith written objection to
the calculation of Net Current Assets at least three (3) Business Days prior to
the anticipated Closing Date (the "OBJECTION NOTICE"). The Company shall make
available to Purchaser and its representatives the books, records and workpapers
used to prepare the Estimated Closing Balance Sheet. In the event of an
Objection Notice, the Company and Purchaser shall negotiate in good faith during
the period preceding the Closing Date to resolve the dispute. If the dispute is
not resolved by the specified Closing Date, Purchaser shall pay an Estimated
Purchase Price based upon the amount of any Deficiency or Surplus, as
applicable, resulting from the calculation of Net Current Assets set forth in
the Estimated Balance Sheet.
(b) As promptly as practicable after the Closing Date, but in
no event more than sixty (60) days after the Closing Date (such date on which
the Closing Balance Sheet is delivered, the "CLOSING FINANCIAL STATEMENTS
DELIVERY DATE"), Purchaser will prepare and deliver to the Company and Parent a
balance sheet of the Company as of the close of business on the Closing Date
(the "CLOSING BALANCE SHEET") and a calculation of Net Current Assets, in a
manner consistent with the calculation set forth on EXHIBIT H attached hereto,
from such Closing Balance Sheet. The Closing Balance Sheet shall be accompanied
by a certificate of the Chief Financial Officer of Purchaser to the effect that
the Closing Balance Sheet presents fairly, in accordance with GAAP and the
accounting practices of the Company applied on a consistent basis, the financial
condition of the Company as of the close of business on the Closing Date and
that the Net Current Assets calculation was made in accordance with the terms of
this Agreement.
(c) The Company and a firm of independent public accountants
designated by the Company (the "COMPANY'S ACCOUNTANT") will be entitled to
reasonable access during normal
9
business hours to the relevant records, personnel and working papers of the
Purchaser to aid in their review of the Closing Balance Sheet and the
calculation of Net Current Assets therefrom. The Closing Balance Sheet and the
calculation of Net Current Assets therefrom shall be deemed to be accepted by
the Company and shall be conclusive for the purposes of the adjustment described
in SECTION 1.05(d) and (e) hereof except to the extent, if any, that the Company
or Company's Accountant shall have delivered, within thirty (30) days after the
Closing Financial Statements Delivery Date, a written notice to Purchaser
setting forth objections thereto, specifying in reasonable detail any such
objection (it being understood that any amounts not disputed as provided herein
shall be paid promptly). If a change proposed by the Company is disputed by
Purchaser, then Purchaser and the Company shall negotiate in good faith to
resolve such dispute. If, after a period of thirty (30) days following the date
on which the Company gives Purchaser notice of any such proposed change, any
such proposed change still remains disputed, then Purchaser and the Company
hereby agree that the Las Vegas, Nevada office of PriceWaterhouseCoopers LLP
(the "ACCOUNTING FIRM") shall resolve any remaining disputes. The Accounting
Firm shall act as an arbitrator to make a determination with respect to the
issues that are disputed by the parties, based on presentations by the Company
and Purchaser, and by independent review of the Accounting Firm if deemed
necessary in the sole discretion of the Accounting Firm, which determination
shall be limited to only those issues still in dispute. The decision of the
Accounting Firm shall be final and binding and shall be in accordance with the
provisions of this SECTION 1.05(b). The fees and expenses of the Accounting
Firm, if any, shall be paid equally by Purchaser and the Company. The date on
which the Net Current Assets is finally determined pursuant to this SECTION 1.05
is referred to hereinafter as the "DETERMINATION DATE."
(d) If the amount of Net Current Assets used to determine the
Estimated Purchase Price pursuant to SECTION 1.05(a) above is greater than the
amount set forth in the Closing Balance Sheet, the Company shall pay to
Purchaser, as an adjustment to the Estimated Purchase Price, an aggregate amount
equal to such excess. Any payments required to be made by the Company pursuant
to this SECTION 1.05(d) shall be made within ten (10) days of the Determination
Date by wire transfer of immediately available funds to an account designated by
Purchaser.
(e) If the amount of Net Current Assets used to determine the
Estimated Purchase Price pursuant to SECTION 1.05(a) above is less than the
amount set forth in the Closing Balance Sheet, Purchaser shall pay to the
Company, as an adjustment to the Estimated Purchase Price, an amount equal to
such difference. Any payments required to be made by Purchaser pursuant to this
SECTION 1.05(e) shall be made within ten (10) days of the Determination Date by
wire transfer of immediately available funds to an account designated by the
Company.
1.06 PRORATIONS. The following prorations relating to the
Assets and the ownership and operation of the Business will be made as of the
Transfer Time, with the Company liable to the extent such items relate to any
time period prior to the Transfer Time and are Retained Liabilities and
Purchaser liable to the extent such items relate to periods beginning with and
subsequent to the Transfer Time or are Assumed Liabilities:
10
(a) Real estate taxes and assessments on or with respect to
the Real Property, provided that proration with respect to Leased Real Property
shall be based upon the amounts payable by the Company in respect to such taxes
under the Real Property Leases.
(b) Rents, additional rents, taxes and other items payable by
or to the Company under the Real Property Leases and Personal Property Leases.
(c) The amount of rents, taxes and charges for sewer, water,
telephone, electricity and other utilities relating to the Real Property.
(d) All other items normally adjusted in connection with
similar transactions.
Except as otherwise agreed by the parties or with respect to amounts to
adjustments to the Purchase Price made pursuant to SECTION 1.05, the net amount
of all such prorations will be settled and paid on the Closing Date. If the
Closing shall occur before a real estate tax rate is fixed, the apportionment of
taxes shall be based upon the tax rate for the preceding year applied to the
latest assessed valuation.
1.07 FURTHER ASSURANCES; POST-CLOSING COOPERATION.
(a) Subject to the terms and conditions of this Agreement, at
any time or from time to time after the Closing, at Purchaser's request and
without further consideration, the Company shall execute and deliver to
Purchaser such other instruments of sale, transfer, conveyance, assignment and
confirmation, provide such materials and information and take such other actions
as Purchaser may reasonably deem necessary or desirable in order more
effectively to transfer, convey and assign to Purchaser, and to confirm
Purchaser's title to, all of the Assets (including, without limitation, the
delivery to Purchaser of fully executed Uniform Commercial Code amendment or
termination statements relating to the Assets as Purchaser shall request), and,
to the full extent permitted by Law, to put Purchaser in actual possession and
operating control of the Business and the Assets and to assist Purchaser in
exercising all rights with respect thereto, and otherwise to cause the Company
to fulfill its obligations under this Agreement.
(b) Following the Closing, the Company and Purchaser will
afford the other party, its counsel and its accountants, during normal business
hours, reasonable access to the books, records and other data relating to the
Business in its possession with respect to periods prior to the Closing and the
right to make copies and extracts therefrom, to the extent that such access may
be reasonably required by the requesting party in connection with (i) the
preparation of Tax Returns, (ii) the determination or enforcement of rights and
obligations under this Agreement, (iii) compliance with the requirements of any
Governmental or Regulatory Authority including without limitation the
Commission, (iv) the determination or enforcement of the rights and obligations
of any party to this Agreement and (v) in connection with any actual or
threatened Action or Proceeding. Further, the Company and Purchaser agree for a
period extending six (6) years after the Closing Date not to destroy or
otherwise dispose of any such books, records and other data unless such party
shall first offer in writing to surrender such books, records and other data to
the other party and such other party shall not agree in writing to take
possession thereof during the ten (10) day period after such offer is made.
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(c) If, in order properly to prepare its Tax Returns, other
documents or reports required to be filed with Governmental or Regulatory
Authorities or its financial statements or to fulfill its obligations hereunder,
it is necessary that the Company or Purchaser be furnished with additional
information, documents or records relating to the Business not referred to in
paragraph (b) above, and such information, documents or records are in the
possession or control of the other party, such other party shall use its
commercially reasonable efforts to furnish or make available such information,
documents or records (or copies thereof) at the recipient's request, cost and
expense.
(d) Notwithstanding anything to the contrary contained in this
Section, if the Company and Purchaser are in an adversarial relationship in
litigation or arbitration, the furnishing of information, documents or records
in accordance with paragraphs (b) and (c) of this Section shall be subject to
applicable rules relating to discovery.
1.08 THIRD-PARTY CONSENTS; ACI'S GAMING COMPLIANCE
PROGRAM.
(a) To the extent that any Real Property Lease, Personal
Property Lease, Business Contract or Business License is not assignable without
the consent of another party, this Agreement shall not constitute an assignment
or an attempted assignment thereof if such assignment or attempted assignment
would constitute a breach thereof or a default thereunder. The Company and
Purchaser shall use commercially reasonable efforts to obtain the consent of
such other party to the assignment of any such Real Property Lease, Personal
Property Lease, Business Contract or Business License to Purchaser in all cases
in which such consent is required for such assignment, PROVIDED, HOWEVER, that
in the event any such consent, other than any required consent of the Commission
or any consent that is listed in SECTION 6.09 OF THE DISCLOSURE SCHEDULE (each a
"REQUIRED CONSENT"), is not obtained on or prior to the Closing Date, such event
shall not cause the Closing to be delayed or constitute a default by the Company
of any obligation hereunder or result in a reduction of the Purchase Price. If
any such consent, other than a Required Consent, shall not be obtained, the
Company shall cooperate with Purchaser in any reasonable arrangement designed to
provide for Purchaser the benefits intended to be assigned to Purchaser under
the relevant Real Property Lease, Personal Property Lease, Business Contract or
Business License, including enforcement at the cost and for the account of
Purchaser of any and all rights of the Company against the other party thereto
arising out of the breach or cancellation thereof by such other party or
otherwise, provided that if Purchaser does not receive the benefits intended to
be assigned to Purchaser pursuant to a Real Property Lease, Personal Property
Lease, Business Contract or Business License because a consent is not obtained
and an arrangement transferring such benefit is not entered into, such Real
Property Lease, Personal Property Lease, Business Contract or Business License,
as applicable, shall constitute an Excluded Asset and the obligations pursuant
thereto shall constitute a Retained Liability.
(b) In the event that any background investigation with
respect to any party (and its respective owners and management) to any Real
Property Lease, Personal Property Lease or Business Contract to which Purchaser
will become a party by virtue of the consummation of the transactions
contemplated hereby results in a finding by ACI that such party is an
"Unsuitable Person" (as defined in ACI's Gaming Compliance Program in the form
provided to Parent), then such Real Property Lease, Personal Property Lease or
Business
12
Contract shall not be assumed by Purchaser and shall constitute an Excluded
Asset and a Retained Liability. ACI shall notify Parent and the Company no later
than forty-five (45) days following the Effective Date if such investigation
reveals that any such party is an "Unsuitable Person," which notice shall
specify the identity of the person that has been determined to be unsuitable and
shall also indicate if any person that is subject to a background investigation
required pursuant to ACI's Gaming Compliance Program has not responded to
inquiries made pursuant to such background investigation.
1.09 INSURANCE PROCEEDS. If any of the Assets is destroyed or
damaged or taken in condemnation following the Effective Date, the insurance
proceeds or condemnation award with respect thereto shall be an Asset. At the
Closing, the Company shall pay or credit to Purchaser any such insurance
proceeds or condemnation awards received by it on or prior to the Closing (along
with the amount of any deductible or retention withheld therefrom) and shall
assign to or assert for the benefit of Purchaser all of its rights against any
insurance companies, Governmental or Regulatory Authorities and others with
respect to such damage, destruction or condemnation. As and to the extent that
there is available insurance under policies maintained by the Company and its
Affiliates, predecessors and successors in respect of any Assumed Liability,
except for any such insurance proceeds with respect to which the insured is
directly or indirectly self-insured or has agreed to indemnify the insurer, the
Company shall cause such insurance to be applied toward the payment of such
Assumed Liability.
ARTICLE II
REPRESENTATIONS AND WARRANTIES OF THE COMPANY AND PARENT
The Company and Parent hereby jointly and severally represent
and warrant to Purchaser as follows as of the Effective Date and as of the
Closing Date, except, to the extent any such representation or warranty is made
as of a specified date earlier than the Closing Date, such earlier date:
2.01 CORPORATE EXISTENCE.
(a) The Company is a corporation duly incorporated, validly
existing and in good standing under the Laws of the State of Missouri, and has
full corporate power and authority to conduct its business as and to the extent
now conducted and to own, use and lease its Assets and enter into and perform
this Agreement and consummate the transactions contemplated hereby.
(b) SUBSIDIARIES. The Company does not have any subsidiaries,
other than Front Street Station, LLC, or any other equity investment in any
entity, nor does it own any other securities with respect to any entity, other
than Front Street Station, LLC. Front Street Station, LLC does not own any
assets or conduct any operations related to the Business or otherwise.
2.02 AUTHORITY. The execution and delivery by the Company of
this Agreement, and the performance by the Company and Parent of their
obligations hereunder, have been duly and validly authorized by the Board of
Directors and the stockholder of the Company and the Board of Directors of
Parent, no other action on the part of the Company or
13
Parent or their stockholders being necessary. This Agreement has been duly and
validly executed and delivered by the Company and Parent and constitutes a
legal, valid and binding obligation of the Company and Parent enforceable
against the Company and Parent in accordance with its terms, except to the
extent such enforceability (a) may be limited by bankruptcy, insolvency,
reorganization, moratorium or other similar laws relating to creditors' rights
generally, and (b) is subject to general principles of equity.
2.03 NO CONFLICTS. Except as set forth in SECTION 2.03 OF THE
DISCLOSURE SCHEDULE, the execution, delivery and performance by the Company of
this Agreement do not and the consummation of the transactions contemplated
hereby will not:
(a) conflict with or result in a violation or breach of any of
the terms, conditions or provisions of the articles of incorporation or bylaws
(or other comparable charter documents) of the Company;
(b) subject to obtaining the consents, approvals and actions,
making the filings and giving the notices disclosed in SECTION 2.04 OF THE
DISCLOSURE SCHEDULE, conflict with or result in a violation or breach of any
term or provision of any Law or Order applicable to the Company or any of the
Assets (other than such conflicts, violations or breaches (i) which could not in
the aggregate reasonably be expected to materially and adversely affect the
validity or enforceability of this Agreement or to have a Material Adverse
Effect or (ii) as would occur solely as a result of the identity or the legal or
regulatory status of Purchaser or any of its Affiliates); or
(c) except as could not, individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect or to materially and
adversely affect the ability (i) of the Company to consummate the transactions
contemplated hereby or to perform its obligations hereunder or (ii) Purchaser to
operate the Business after the Transfer Time in a manner substantially
consistent with the Company's past practice, (A) conflict with or result in a
violation or breach of, (B) constitute (with or without notice or lapse of time
or both) a default under, (C) require the Company to obtain any consent,
approval or action of, make any filing with or give any notice to any Person as
a result or under the terms of, (D) result in or give to any Person any right of
termination, cancellation, acceleration or modification in or with respect to,
or (E) result in the creation or imposition of any Lien upon the Company or any
of the Assets under, any Contract or License to which the Company is a party or
by which any of its Assets is bound.
2.04 GOVERNMENTAL APPROVALS AND FILINGS. Except as disclosed
in SECTION 2.04 OF THE DISCLOSURE SCHEDULE, no consent, approval, action, order
or authorization of, or registration, declaration or filing with or notice to
any Governmental or Regulatory Authority on the part of the Company is required
in connection with the execution, delivery and performance of this Agreement or
the consummation of the transactions contemplated hereby, except (a) where the
failure to obtain any such consent, approval or action, to make any such filing
or to give any such notice could not reasonably be expected to materially and
adversely affect the ability of the Company to consummate the transactions
contemplated by this Agreement or to perform its obligations hereunder, or to
have a Material Adverse Effect, and (b) those as would
14
be required solely as a result of the identity or the legal or regulatory status
of Purchaser or any of its Affiliates.
2.05 FINANCIAL STATEMENTS AND CONDITION.
(a) Prior to the execution of this Agreement, the Company has
delivered to Purchaser true and complete copies of (i) the unaudited combined
balance sheets and the related combined statements of operations, stockholder's
equity and cash flows of the Company and Kansas City Station Corporation for the
fiscal year ended December 31, 1999, and (ii) the unaudited combined balance
sheets of the Company and Kansas City Station Corporation as of March 31, 2000
and June 30, 2000 and the related unaudited statement of operations for the
portion of the fiscal year then ended. Except as set forth in the notes thereto
and as disclosed in SECTION 2.05(a) OF THE DISCLOSURE SCHEDULE, all such
financial statements were prepared in accordance with GAAP and fairly present in
all material respects the combined financial condition and results of operations
of the Company and Kansas City Station Corporation, in each case, as of the
respective dates thereof and for the respective periods covered thereby.
(b) Except for the execution and delivery of this Agreement
and the transactions to take place pursuant hereto on or prior to the Closing
Date and except as disclosed in SECTION 2.05(b) OF THE DISCLOSURE SCHEDULE,
during the period beginning on the Financial Statement Date and ending on the
Effective Date there has not been any change with respect to the Business or the
Assets that could reasonably be expected to have a Material Adverse Effect.
2.06 TAXES.
(a) TAX LIENS. Except as set forth in SECTION 2.06(a) OF THE
DISCLOSURE SCHEDULE, there are no Tax Liens upon the assets of the Company
except liens for Taxes not yet due.
(b) COMPLIANCE WITH TAX LAWS. Except as set forth in SECTION
2.06(b) OF THE DISCLOSURE SCHEDULE, the Company has complied (and, with respect
to all amounts due with respect to periods through and including the Closing
Date, will comply) with all applicable laws, rules, and regulations relating to
the filing of Tax Returns and the payment and withholding of Taxes (including,
without limitation, withholding and reporting requirements under Code ss.ss.1441
through 1464, 3401 through 3406, 6041 and 6049 and similar provisions under any
other laws) and have, within the time and in the manner prescribed by law,
withheld from employee wages and paid over to the proper governmental
authorities all required amounts.
2.07 LEGAL PROCEEDINGS. Except as disclosed in SECTION 2.07 OF
THE DISCLOSURE SCHEDULE, there are no Orders outstanding and no Actions or
Proceedings pending or, to the Knowledge of the Company, threatened against,
relating to or affecting the Company or any of its Assets which could reasonably
be expected individually or in the aggregate to have a Material Adverse Effect,
or which seek to enjoin, rescind or otherwise prevent the consummation of the
transactions contemplated hereby.
2.08 COMPLIANCE WITH LAWS AND ORDERS. To the Knowledge of the
Company, except as disclosed in SECTION 2.08 OF THE DISCLOSURE SCHEDULE or in
the filings of Parent with the Securities and Exchange Commission, the Company
is not in violation of or in default under any
15
Law or Order applicable to the Company or any of its Assets the effect of which,
individually or in the aggregate with other such violations and defaults, could
reasonably be expected to have a Material Adverse Effect.
2.09 BENEFIT PLANS; ERISA; LABOR MATTERS.
SECTION 2.09(a) OF THE DISCLOSURE SCHEDULE contains a true and
complete list of each Benefit Plan and "employee benefit plan" (within the
meaning of section 3(3) of ERISA, including, without limitation, multiemployer
plans within the meaning of ERISA section 3(37)), stock purchase, stock option,
severance, employment, change-in-control, fringe benefit, collective bargaining,
bonus, incentive, deferred compensation and all other employee benefit plans,
agreements, programs, policies or other arrangements, whether or not subject to
ERISA (including any funding mechanism therefor now in effect or required in the
future as a result of the transaction contemplated by this Agreement or
otherwise), whether formal or informal, oral or written, legally binding or not,
under which any employee or former employee of the Company has any present or
future right to benefits or under which the Company has any present or future
liability. All such plans, agreements, programs, policies and arrangements shall
be collectively referred to as the "COMPANY PLANS."
(c) With respect to each Company Plan, the Company has
delivered to Purchaser a current, accurate and complete copy (or, to the extent
no such copy exists, an accurate description) thereof.
(d) No Lien has arisen on the Assets by reason of Section 302
of ERISA, Section 412 of the Code or Title IV of ERISA.
(e) Except as set forth in SECTION 2.09(e) OF THE DISCLOSURE
SCHEDULE, no individual shall accrue or receive additional benefits, service or
accelerated rights to payments of benefits under any Benefit Plan, as defined in
Section 280G of the Code, or become entitled to severance, termination allowance
or similar payments as a direct result of the transactions contemplated by this
Agreement.
(f) There are no controversies pending or, to the Knowledge of
the Company, threatened between the Company and any of its employees which
controversies would have a Material Adverse Effect. The Company is not a party
to any collective bargaining agreement or other labor union Contract applicable
to persons employed by the Company except as disclosed in SECTION 2.09(f) OF THE
DISCLOSURE SCHEDULE. To the Knowledge of the Company, there are no strikes,
slowdowns, work stoppages, lockouts or threats thereof by or with respect to any
of the employees of the Company.
(g) SECTION 2.09(g) OF THE DISCLOSURE SCHEDULE lists the
number of employees terminated by the Company at each site of employment of the
Business in the 90-day period ending on the date hereof, and the date of such
termination, with respect to each such termination which would be required to be
taken into account in determining whether a "plant closing" or "mass layoff"
subject to the Worker Adjustment and Retraining Notification Act (the "WARN")
could occur based on subsequent terminations; provided that this sentence shall
not apply with
16
respect to any site of employment at which sufficient employees have not been
employed at any time in such 90-day period for terminations of employment at
such site to be subject to WARN.
2.10 REAL PROPERTY.
(a) SECTION 2.10(a) OF THE DISCLOSURE SCHEDULE contains a list
of (i) each parcel of real property currently owned by the Company and (ii) each
parcel of real property leased by the Company.
(b) The Company has good and marketable title to each parcel
of real property described in CLAUSE (i) of PARAGRAPH (a) above free and clear
of Liens, except for Permitted Liens or as disclosed in SECTION 2.10(b) OF THE
DISCLOSURE SCHEDULE, and has a valid and subsisting leasehold estate in the real
properties referred to in CLAUSE (ii) of PARAGRAPH (a) above free and clear of
Liens, except for Permitted Liens or as disclosed in SECTION 2.10(b) OF THE
DISCLOSURE SCHEDULE. To the Knowledge of the Company, all of the Real Property
Leases are valid, binding, and enforceable in accordance with their terms, and
are in full force and effect as of the date hereof. To the Knowledge of the
Company, except as disclosed in SECTION 2.10(b) OF THE DISCLOSURE SCHEDULE there
are no existing material defaults by the Company beyond any applicable grace
periods under such leases and the Company has not received any notice of default
under any of such leases.
(c) Without limiting the generality of the foregoing, as to
leasehold estates under the Real Property Leases, the Company warrants that it
has quiet and peaceful possession of each of the properties leased by it.
(d) To the Knowledge of the Company, the Real Property is not
subject to any deferred or rollback taxes on account of any change in zoning or
land use classification, and to the Knowledge of the Company there are no
pending assessments affecting the Real Property.
(e) Except as could not be reasonably expected to have a
Material Adverse Effect, all water, sewer, gas, electric, telephone and drainage
facilities and all other utilities required by law or for the present normal use
and operation of the Business are all connected and operating pursuant to valid
permits, are adequate to service the Business, and such facilities are connected
by means of one or more public or private easements extending from a property
line to one or more public streets, public rights-of-way or utility facilities.
(f) There are no pending or, to the Knowledge of the Company,
threatened condemnation, eminent domain or similar proceedings affecting the
Real Property or any portion thereof.
(g) The Company is not a "foreign person" within the meaning
of Section 1445 ET SEQ. of the Internal Revenue Code of 1986, as amended.
(h) The mechanical equipment located in any improvements
located on the Real Property, including but not limited to air conditioning and
heating systems and the electrical and plumbing systems, are in sufficient
condition to permit the operation of the Business as it is currently conducted.
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2.11 TANGIBLE PERSONAL PROPERTY. The Company is in possession
of and has good title to, or has valid leasehold interests in or valid rights
under Contract to use, the Expansion Materials and all tangible personal
property used in and, individually or in the aggregate with other such property,
material to the Business or Condition of the Company, except for such tangible
personal property sold, consumed or otherwise disposed of in the ordinary course
of business since the Financial Statement Date. All tangible Assets, taken as a
whole, are in sufficient condition to permit the operation of the Business as it
is currently conducted.
2.12 CONTRACTS.
(a) SECTION 2.12(a) OF THE DISCLOSURE SCHEDULE (with paragraph
references corresponding to those set forth below) contains a true and complete
list of each of the following Contracts that constitute Assets as of the
Effective Date:
(i) all Contracts (excluding Benefit Plans) providing for a
commitment of employment or consultation services for a specified term
and payments at any one time or in any one year in excess of One
Hundred Thousand Dollars ($100,000);
(ii) all Contracts with any Person containing any provision or
covenant prohibiting or materially limiting the ability of the Company
to engage in any business activity or compete with any Person;
(iii) all Contracts relating to Indebtedness of the Company
included as an Assumed Liability;
(iv) all Contracts (other than this Agreement) providing for
(A) the future disposition or acquisition of any assets or properties
individually or in the aggregate material to the Business, other than
dispositions or acquisitions in the ordinary course of business, and
(B) any merger or other business combination;
(v) all Contracts between the Company, on the one hand, and
any Affiliate of the Company, on the other hand and which is included
as an Assumed Liability;
(vi) all Contracts (other than this Agreement) that limit or
contain restrictions on the ability of the Company to incur
Indebtedness or incur or suffer to exist any Lien, to purchase or sell
any Assets, to change the lines of business in which it participates or
engages or to engage in any merger or other business combination and
which is included as an Assumed Liability;
(vii) all other Contracts that (A) involve the payment,
pursuant to the terms of any such Contract, by or to the Company of
more than One Hundred Thousand Dollars ($100,000) annually or (B)
cannot be terminated within ninety (90) days after giving notice of
termination without resulting in any material cost or penalty to the
Company; and
(viii) all Real Property Leases.
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(b) As of the Effective Date, each Contract required to be
disclosed in SECTION 2.12(a) OF THE DISCLOSURE SCHEDULE, true and complete
copies of which have been delivered to Purchaser, is in full force and effect
and constitutes a legal, valid and binding agreement, enforceable in accordance
with its terms, of the Company and, to the Knowledge of the Company, of each
other party thereto; and except as disclosed in SECTION 2.12(b) OF THE
DISCLOSURE SCHEDULE neither the Company nor, to the Knowledge of the Company,
any other party to such Contract is in violation or breach of or default under
any such Contract (or with notice or lapse of time or both, would be in
violation or breach of or default under any such Contract) as of the Effective
Date, the effect of which, individually or in the aggregate, could reasonably be
expected to have a Material Adverse Effect.
(c) As of the Effective Date, the July Agreement has been
terminated by the parties thereto and is of no further force or effect.
2.13 LICENSES. As of the Effective Date, the Company has all
Licenses required for the conduct of the Business as presently conducted (other
than Licenses, the absence of which could not reasonably be expected to have a
Material Adverse Effect). Except as set forth on SECTION 2.13 OF THE DISCLOSURE
SCHEDULE, each such License is valid, binding and in full force and effect as of
the Effective Date. Except as set forth on SECTION 2.13 OF THE DISCLOSURE
SCHEDULE, to the Knowledge of the Company, as of the Effective Date the Company
is not in default (or with the giving of notice or lapse of time or both, would
be in default) under any such License in any respect that could reasonably be
expected to have a Material Adverse Effect. The Licenses listed in SECTION 2.13
OF THE DISCLOSURE SCHEDULE are not transferable.
2.14 AFFILIATE TRANSACTIONS. There is no Liability between the
Company, on the one hand, and any officer, director or Affiliate of the Company,
on the other, that will constitute an Assumed Liability.
2.15 ENVIRONMENTAL MATTERS. Except as disclosed in SECTION
2.15 OF THE DISCLOSURE SCHEDULE or as could not be reasonably expected to have
a Material Adverse Effect, to the Knowledge of the Company:
(a) the Company holds and is in compliance with all Licenses
which are required under applicable Environmental Laws for the Company to own
and operate the Business (the "ENVIRONMENTAL PERMITS") and will use commercially
reasonable efforts to provide copies of such Environmental Permits to Purchaser
and to facilitate the transfer of those Environmental Permits which are
transferable to Purchaser;
(b) the Company and all real property owned, operated or
leased by the Company are in compliance with applicable Environmental Laws;
(c) the Company has not been notified by any Governmental or
Regulatory Authority or third party of any pending or threatened claim arising
under Environmental Laws (an "ENVIRONMENTAL CLAIM") against the Business or the
Company in connection with the Business;
(d) the Company has not been notified by any Governmental or
Regulatory Authority or third party of any pending claim that either the
Business or the Company in
19
connection with the Business may be a potential responsible party for
environmental contamination or any Release of Hazardous Material, nor has the
Company been notified that any site or facility now or previously owned or
leased by the Company is listed or proposed for listing on the NPL or any
similar state or local list of sites requiring investigation or clean-up;
(e) the Company in connection with the Business has not
entered into or agreed to any consent decree or order with respect to or
affecting the Assets relating to compliance with any Environmental Law or to
investigation or cleanup of Hazardous Material under any Environmental Law;
(f) there are no aboveground or underground storage tanks
located on, in or under any properties currently or formerly owned, operated or
leased by the Company in connection with the Business or any predecessor of the
Business or the Company in connection with the Business;
(g) no Releases of Hazardous Material have occurred at, from,
in, on, to or under any property currently or formerly owned, operated or leased
by the Company in connection with the Business or any predecessor of the
Business or the Company, and no Hazardous Material is present in, on or about or
is migrating to or from any such property that could give rise to an
Environmental Claim by a Governmental or Regulatory Authority or third party
against the Business or the Company;
(h) neither the Company in connection with the Business, nor
any predecessors thereof, has transported or arranged for the treatment,
storage, handling, disposal or transportation of any Hazardous Substance to any
location that could result in an Environmental Claim against or liability to the
Business or the Company;
(i) there is no amount of asbestos, ureaformaldehyde material,
polychlorinated biphenyl containing equipment or lead paint containing materials
in, at or on any property owned, leased or operated by the Company in connection
with the Business; and
(j) there have been no environmental investigations, studies,
audits or tests with respect to any property currently or formerly owned, leased
or operated by the Company in connection with the Business thereof which have
not been delivered to Purchaser prior to execution of this Agreement.
2.16 LABOR MATTERS. To the Knowledge of the Company, the
Company is in compliance in all material respects with all Laws respecting
employment and employment practices, terms and conditions of employment and
wages and hours.
2.17 BROKERS. Except for Xxxxxxxxxxx Xxxxxxx & Co., Inc.,
whose fees, commissions and expenses are the sole responsibility of the Company,
all negotiations relative to this Agreement and the transactions contemplated
hereby have been carried out by the Company directly with Purchaser without the
intervention of any other Person on behalf of the Company in such manner as to
give rise to any valid claim by any Person against Purchaser for a finder's fee,
brokerage commission or similar payment.
20
2.18 ABSENCE OF CERTAIN CHANGES. Except as set forth in
SECTION 2.18 OF THE DISCLOSURE SCHEDULE, since the Financial Statement Date, the
Business has been conducted in the ordinary course, and there has not been:
(a) any event, occurrence, state of circumstances or facts or
change in the Company, the Assets or the Business that has had or that may be
reasonably expected to have, either alone or together, a Material Adverse
Effect;
(b) any change by the Company in its accounting principles,
methods or practices other than changes required pursuant to GAAP or in the
manner it keeps its books and records or any change by the Company of its
current practices with regards to sales, receivables, payables or accrued
expenses;
(c) the entering into of any Contract (other than the July
Agreement) or other arrangement between the Company and any officer, director,
stockholder or Affiliate of the Company; or
(d) any (i) single commitment for capital expenditures that
has not been performed prior to the Effective Date in excess of $1,000,000 for
additions to property, plant, equipment or intangible capital assets, (ii)
commitments for capital expenditures that has not been performed prior to the
Effective Date in an aggregate amount in excess of $5,000,000 for additions to
property, plant, equipment or intangible capital assets or capital expenditures,
(iii) sale, assignment, transfer, lease or other disposition of or agreement to
sell, assign, transfer, lease or otherwise dispose of any asset or property
outside the ordinary course of business having a value of $2,000,000 in the
aggregate.
2.19 SUFFICIENCY OF AND TITLE TO THE ASSETS. Upon consummation
of the transactions contemplated by this Agreement, the Company will have sold,
assigned, transferred and conveyed to Purchaser, free and clear of all Liens,
other than Permitted Liens, all of the Assets, which constitute all of the
properties and assets now held or employed by the Company primarily in
connection with the Business (other than the Excluded Assets). Neither the
Agreement for Property Acquisitions dated September 22, 1999 by and between the
Company and the City of St. Xxxxxxx, Missouri nor the real property described in
SECTION 1.01(b)(xvi) OF THE DISCLOSURE SCHEDULE has been used in the operation
of the Business or is required to operate the Business in the future in the same
manner as it has been conducted prior to the Effective Date.
2.20 INSURANCE. As of the Effective Date, the assets,
properties and operations of the Business are insured under various policies of
insurance, all of which are described in SECTION 2.20 OF THE DISCLOSURE
SCHEDULE, which discloses for each policy the type of coverage and the amounts
of coverage. As of the Effective Date, all such policies are in full force and
effect, no notice of cancellation has been received, and there is no existing
material default, or event which the giving of notice or lapse of time or both,
would constitute a material default, by any insured thereunder.
21
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF PURCHASER and aci
Purchaser and ACI, jointly and severally represent and warrant
to the Company as follows as of the Effective Time and as of the Closing Date,
except, to the extent any such representation or warranty is made as of a
specified date earlier than the Closing Date, such earlier date:
3.01 EXISTENCE. Purchaser is a corporation duly organized,
validly existing and in good standing under the Laws of the State of Missouri.
ACI is a corporation duly organized, validly existing and in good standing under
the Laws of the State of Nevada. Each of Purchaser and ACI has full corporate
power and authority to execute and deliver this Agreement, to perform its
obligations hereunder and to consummate the transactions contemplated hereby.
3.02 AUTHORITY. The execution and delivery by Purchaser and
ACI of this Agreement, and the performance by Purchaser and ACI of their
respective obligations hereunder, have been duly and validly authorized by the
respective boards of directors of Purchaser and ACI, no other corporate action
on the part of Purchaser or ACI or their respective shareholders being
necessary. This Agreement has been duly and validly executed and delivered by
each of Purchaser and ACI and constitutes a legal, valid and binding obligation
of each of Purchaser and ACI enforceable against each of them in accordance with
its terms, except to the extent such enforceability (a) may be limited by
bankruptcy, insolvency, reorganization, moratorium or other similar laws
relating to creditors' rights generally and (b) is subject to general principles
of equity.
3.03 NO CONFLICTS. The execution and delivery by each of
Purchaser and ACI of this Agreement do not and the consummation of the
transactions contemplated hereby will not:
(a) conflict with or result in a violation or breach of any of
the terms, conditions or provisions of the articles of incorporation (or other
comparable corporate charter document) of Purchaser or ACI, as applicable;
(b) subject to obtaining the consents, approvals and actions,
making the filings and giving the notices disclosed in SECTION 3.04 OF THE
DISCLOSURE SCHEDULE, conflict with or result in a violation or breach of any
term or provision of any Law or Order applicable to Purchaser or ACI or any of
the Assets (other than such conflicts, violations or breaches which could not in
the aggregate reasonably be expected to adversely affect the validity or
enforceability of this Agreement); or
(c) except as could not, individually or in the aggregate,
reasonably be expected to adversely affect the ability of Purchaser or ACI to
consummate the transactions contemplated hereby or to perform its obligations
hereunder, (i) conflict with or result in a violation or breach of, (ii)
constitute (with or without notice or lapse of time or both) a default under,
(iii) require Purchaser or ACI to obtain any consent, approval or action of,
make any filing with or give any notice to any Person as a result or under the
terms of, or (iv) result in the
22
creation or imposition of any Lien upon Purchaser or ACI or any of their
respective assets or properties under, any Contract or License to which
Purchaser or ACI is a party or by which any of their respective assets and
properties is bound.
3.04 GOVERNMENTAL APPROVALS AND FILINGS. Except as disclosed
in SECTION 3.04 OF THE DISCLOSURE SCHEDULE, no consent, approval, action, order
or authorization of, or registration, declaration or filing with or notice to
any Governmental or Regulatory Authority on the part of Purchaser or ACI is
required in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby, except
where the failure to obtain any such consent, approval or action, to make any
such filing or to give any such notice could not reasonably be expected to
adversely affect the ability of Purchaser or ACI to consummate the transactions
contemplated by this Agreement or to perform its obligations hereunder.
3.05 LEGAL PROCEEDINGS. There are no Orders outstanding and no
Actions or Proceedings pending or, to the Knowledge of Purchaser or ACI, as
applicable, threatened against, relating to or affecting Purchaser or ACI, as
the case may be, which could reasonably be expected to result in the issuance of
an Order restraining, enjoining or otherwise prohibiting or making illegal the
consummation of any of the transactions contemplated by this Agreement.
3.06 BROKERS. Except for Deutsche Bank Securities Inc., whose
fees, commissions and expenses are the sole responsibility of Purchaser and/or
ACI, all negotiations relative to this Agreement and the transactions
contemplated hereby have been carried out by Purchaser and ACI without the
intervention of any Person on behalf of Purchaser or ACI in such manner as to
give rise to any valid claim by any Person against the Company for a finder's
fee, brokerage commission or similar payment.
3.07 FINANCING. Purchaser has sufficient cash and/or available
credit facilities (and has provided the Company with evidence thereof) to pay
the Purchase Price and to make all other necessary payments of fees and expenses
in connection with the transactions contemplated by this Agreement.
3.08 PURCHASER'S GAMING LICENSES. Neither Purchaser nor any of
its directors or executive officers has ever been denied a gaming license by any
Governmental or Regulatory Authority. ACI and the directors and executive
officers of Purchaser are currently licensed or hold findings of suitability to
conduct gaming activities in the States of Nevada, Mississippi and Iowa. A list
of such directors, officers and each such state in which such Person is licensed
or holds a finding of suitability is set forth in SECTION 3.08 OF THE DISCLOSURE
SCHEDULE.
ARTICLE IV
COVENANTS OF THE COMPANY AND PARENT
The Company and Parent covenant and agree with Purchaser that,
at all times from and after the Effective Date until the Closing, and in the
case of SECTIONS 4.06, 4.11 and 4.12 for the period set forth therein, Parent
and the Company will, and Parent will cause the Company to, comply with all
covenants and provisions of this ARTICLE IV, except to the extent
23
Purchaser may otherwise consent in writing. Purchaser acknowledges and agrees
that the actions taken, or failed to be taken, by Parent and the Company prior
to or following the Effective Date with respect to the investigation by the
Commission or any other Governmental or Regulatory Authority into the activities
of Xxxxxxx Xxxxxxxx and the involvement of Parent and the Company therewith, and
any related matters, shall not constitute a breach of the obligations of Parent
and the Company pursuant to this ARTICLE IV; PROVIDED, HOWEVER, that Purchaser
shall have no liability with respect to any obligations resulting from such
investigation and all liabilities arising out of, or with respect to, such
investigation shall be considered a "Retained Liability" for the purposes of
this Agreement.
4.01 REGULATORY AND OTHER APPROVALS. The Company will, as
promptly as reasonably practicable (a) take all commercially reasonable steps
necessary or desirable to obtain all consents, approvals, actions, orders or
authorizations of, or make all registrations, declarations or filings with and
give all notices to Governmental or Regulatory Authorities or any other Person
required of the Company to consummate the transactions contemplated hereby
(including, without limitation, the Required Consents), (b) provide such other
information and communications to such Governmental or Regulatory Authorities or
other Persons as such Governmental or Regulatory Authorities or other Persons
may reasonably request in connection therewith and (c) provide reasonable
cooperation to Purchaser in connection with the performance of its obligations
under SECTIONS 5.01 and 5.02 below. The Company will provide, or cause to be
provided, notification to Purchaser when any such consent, approval, action,
order, authorization, registration, declaration, filing or notice referred to in
clause (a) above is obtained, taken, made or given, as applicable, and will
advise Purchaser of any communications (and, unless precluded by Law, provide
copies of any such communications that are in writing) with any Governmental or
Regulatory Authority or other Person regarding any of the transactions
contemplated by this Agreement.
4.02 HSR FILINGS. In addition to and not in limitation of the
Company's covenants contained in SECTION 4.01 above, the Company will (a) take
promptly all actions necessary to make the filings required of the Company or
its Affiliates under the HSR Act, (b) comply at the earliest practicable date
with any request for additional information received by the Company or its
Affiliates from the Federal Trade Commission or the Antitrust Division of the
Department of Justice pursuant to the HSR Act and (c) cooperate with Purchaser
in connection with Purchaser's filing under the HSR Act and in connection with
resolving any investigation or other inquiry concerning the transactions
contemplated by this Agreement commenced by either the Federal Trade Commission
or the Antitrust Division of the Department of Justice or state attorneys
general.
4.03 INVESTIGATION BY PURCHASER. The Company will (a) provide
Purchaser and its officers, employees, counsel, accountants, financial advisors,
consultants and other representatives (together, "REPRESENTATIVES") with full
access, upon reasonable prior notice and during normal business hours, to all
officers, employees, agents and accountants of the Company and its Assets and
Books and Records, but only to the extent that such access does not unreasonably
interfere with the business operations of the Company and (b) furnish Purchaser
and such other Persons with all such information and data (including, without
limitation, copies of Contracts, Benefit Plans and other Books and Records)
concerning the business and operations of the Company as Purchaser or any of
such other Persons reasonably may request in
24
connection with such investigation, except to the extent that furnishing any
such information or data would violate any Law, Order, Contract or License
applicable to the Company or by which any of its Assets is bound.
4.04 CONDUCT OF BUSINESS. Subject to SECTION 4.05 below, the
Company will conduct business only in the ordinary course consistent with past
practice and shall:
(a) take all actions to be in compliance with, and to maintain
the effectiveness of, all Licenses, it being acknowledged and agreed that
actions taken, or failed to be taken, by Parent and the Company prior to or
following the Effective Date with respect to the investigation by the Commission
or any other Governmental or Regulatory Authority into the activities of Xxxxxxx
Xxxxxxxx and the involvement of Parent and the Company therewith shall not
constitute a breach of this clause (a);
(b) preserve the goodwill of those of its suppliers, customers
and distributors having material business relationships with the Business,
unless such failure to preserve such goodwill would not be commercially
unreasonable;
(c) maintain policies of insurances with substantially the
same insurance coverage as exists as of the Effective Date against loss or
damage to the Assets;
(d) use commercially reasonable efforts to maintain the
Assets, in the aggregate, in a condition comparable to their current condition,
reasonable wear, tear and depreciation excepted, and except for Assets disposed
of, sold or consumed in the ordinary course of business in accordance with
SECTION 4.05(a) below;
(e) continue and maintain its dredging operations in material
compliance with the requirements of applicable Laws; and
(f) unless precluded by law, notify Purchaser in writing if to
the Knowledge of the Company there is any event, condition, circumstance or
group of actions, events, conditions or circumstances that could be reasonably
expected to have a Material Adverse Effect, provided that nothing contained
herein shall be deemed to require the Company to disclose any information that
is privileged.
4.05 CERTAIN RESTRICTIONS. The Company shall not:
(a) other than in the ordinary course of business, acquire,
lease, dispose of or otherwise transfer, any Assets;
(b) engage with any Person in any merger or other business
combination; or
(c) amend or modify in any material respect or terminate any
material Contract that could be reasonably expected to have a Material Adverse
Effect;
(d) make any material changes in the Company's staffing levels
that could be reasonably expected to have a Material Adverse Effect;
25
(e) without Purchaser's prior written approval, which approval
shall not be unreasonably withheld, materially increase the salary, bonus or
other compensation of any of the Company's current employees that are department
heads of the Business, other than pursuant to bonus plans that have been
approved prior to the Effective Date, increases pursuant to employment
agreements entered into prior to the Effective Date and increases consistent
with past practices in an amount not to exceed five percent (5%) of the
applicable employee's most recent annual salary and bonus
(f) enter into any Contract to do or engage in any of items
listed in clauses (a) through (g) above; or
(g) except as expressly permitted elsewhere in this Agreement,
enter into or commit or propose to enter into any Contract obligating the
Company to make payments thereunder in excess of $100,000 in any twelve-month
period that cannot be cancelled upon thirty days notice; and
(h) amend its articles of incorporation or bylaws in any
manner that would have an adverse effect on the transactions contemplated
hereby.
4.06 TRANSITION PERIOD.
(a) Subject to the prior approval of the Commission, the
Company and Parent will, beginning at the Transfer Time until the earlier of (x)
twenty-four (24) months after the Transfer Time and (y) the date on which
Purchaser opens the expansion facilities of the Business for conduct of gaming
activities by the public, permit Purchaser to use and employ, solely in
connection with the operation of the Business and pursuant to a non-exclusive,
non-transferable, royalty-free license and right to use, the "Station Casino"
name and logo (the "XXXX") in connection with the operation of the Business
following the Closing; provided that Purchaser shall conduct the Business under
the Xxxx in a manner that is of a quality which at all times comports with the
quality of the goods and services previously offered by the Company and its
Affiliates under the Xxxx at the acquired property. The Company or its designee
shall have the right, upon reasonable notice to Purchaser and during reasonable
business hours, to inspect the premises of the Business to ensure that the
quality of the Business is being maintained. In the event Purchaser fails to
carry out or comply with such quality standards, the Company may immediately
terminate this non-exclusive, non-transferable, royalty-free license upon
written notice to Purchaser.
(b) Each of the Company and Parent will, beginning at the
Effective Date and for a period of twelve (12) months after the Transfer Time,
upon reasonable request from Purchaser and at the sole cost and expense of
Purchaser, promptly provide Purchaser any and all information regarding the
Assets and the Business, including but not limited to financial, accounting, tax
and related data, reasonably necessary for the preparation by Purchaser of
applications, reports and filings with any Governmental or Regulatory Authority.
(c) Each of the Company and Parent will, following the
Effective Date and at the sole cost and expense of Purchaser, provide reasonable
assistance to Purchaser with respect to the transfer of the Assets, including,
without limitation, the transition and integration of
26
payroll and benefit processing, accounting systems and other similar
administrative systems and software systems constituting Assets. In addition,
the Company and Parent will reasonably cooperate with Purchaser with respect to
any permitted transfer of any rating experience with respect to unemployment and
workers' compensation, and such other processes and procedures with respect to
the operation of the Business as Purchaser may reasonably request.
4.07 NO SOLICITATION. From and after the Effective Date,
neither the Company nor Parent shall, directly or indirectly, through any
officer, director, employee, financial advisor, representative or agent of such
party (i) solicit, initiate, or encourage (including by way of furnishing
information) or take any other action to facilitate knowingly any inquiries or
proposals that constitute, or could reasonably be expected to lead to, a
proposal or offer for a merger, consolidation, business combination, sale of
substantial assets, sale of shares of capital stock (including, without
limitation, by way of a tender or exchange offer) or similar transaction
involving the Company or the Business, other than the transactions contemplated
by this Agreement (an "ACQUISITION PROPOSAL"), (ii) engage in negotiations or
discussions with any person (or group of persons) other than Purchaser or its
affiliates (a "THIRD PARTY") concerning, or provide any non-public information
to any person or entity relating to, any Acquisition Proposal, (iii) continue
any prior discussions or negotiations with any Third Party concerning any
Acquisition Proposal or (iv) accept, or enter into any agreement concerning, any
Acquisition Proposal with any Third Party or consummate any Acquisition Proposal
other than as contemplated by this Agreement.
4.08 TITLE INSURANCE
(a) On the Closing Date, the Company shall, at the Company's
expense (except as provided hereinafter), cause to be issued and delivered to
Purchaser a policy of title insurance (the "Title Policy") with respect to the
Real Property and conforming to the following specifications:
(i) The form of the policy will be ALTA Owner's Policy Form B
1970 (amended 10/17/70), or the current approved form for the
jurisdiction in which the Real Property is located, with an endorsement
deleting any exclusion or exception for creditors' rights;
(ii) The Title Policy will be issued by Assured Quality Title
Company (the "Title Company") and shall be underwritten by First
American Title Insurance Company;
(iii) Reinsurance (with direct access) of all amounts in
excess of $100,000,000, if any, shall be underwritten by Chicago Title
Insurance Company;
(iv) The insured will be Purchaser;
(v) The Title Policy shall be in an amount equal to that
portion of the Purchase Price allocated to the Real Property;
(vi) The Title Policy will be dated concurrent with or
subsequent to the Closing;
27
(vii) There will be no exceptions to coverage other than the
Permitted Liens. Without limiting the generality of the foregoing
provisions hereof, the Title Policy shall not contain any exceptions
with respect to:
(A) Rights or claims of parties in possession other
than tenants, as tenants only, under the leases and subleases
described in SECTIONS 1.01(a)(ii)(A) AND 1.01(a)(ii)(B) OF THE
DISCLOSURE SCHEDULE;
(B) Encroachments, overlaps, boundary line disputes
or any other matters which would be disclosed by an accurate
survey and inspection;
(C) Easements or claims of easements not shown by the
public records;
(D) Any lien, or right to a lien, for services, labor
or materials heretofore or hereafter furnished; and
(E) Any other exceptions which may be designated or
included as standard exceptions in the area where the Real
Property is located.
(viii) The Title Policy, at Purchaser's request and expense,
shall contain a zoning endorsement in the form of ALTA Form 3.1 showing
the zoning classification of the Real Property and confirming that the
current use of the Real Property is in conformance with the applicable
zoning laws and use restrictions; and
(ix) The Title Policy, at Purchaser's request, will contain an
assignment endorsement whereby the insurer agrees to consent to the
assignment of the policy to, and to issue without charge an endorsement
to the policy to show as an insured under the policy, any of the
following: (i) any successor to Purchaser, by dissolution, liquidation,
merger, consolidation or reorganization; (ii) any stockholder of
Purchaser to whom the Real Property, or any part thereof, is
distributed; and (iii) any Affiliate of Purchaser, including any entity
controlled by, in control of or under common control with Purchaser and
to whom an interest in the Real Property, or any part thereof, is
transferred by Purchaser. In the event that the Real Property, or any
part thereof, consists of more than one parcel, the Title Policy shall,
at Purchaser's request, contain an affirmative statement of insurance
to the effect that all parcels of land constituting the Real Property,
or such part thereof, are contiguous. The policy also shall contain
such other affirmative statements of insurance and endorsements (for
example, but not by way of limitation, an "access endorsement") as
Purchaser may reasonably require.
(x) The fee or premium for any endorsements to the Title
Policy whether identified in this Section 4.08 or otherwise requested
by Purchaser, shall be for the account of and paid by Purchaser.
(b) The Company shall within ten (10) days after the date
hereof deliver to Purchaser (i) a current commitment from the Title Company
setting forth the basis upon which the Title Company is willing to insure title
to the Real Property (the "Title Commitment"), and all documents referenced in
Schedule B thereto, and (ii) a copy of each survey (the "Survey") of each parcel
of the Real Property in the Company's possession, which Purchaser acknowledges
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and agrees shall be delivered without any representation or warranty of any kind
as to the accuracy or completeness thereof by the Company or Parent. The cost of
any survey work performed or ordered by the Company prior to the date hereof
shall be paid for by the Company. If Purchaser requires any revisions or updates
to the Survey delivered by the Company or requires a new survey, all such work
shall be at the cost and expense of Purchaser. If the Title Commitment or the
Survey discloses any liens, easements, restrictions, reservations or other
defects or any other matters objectionable to Purchaser ("Title Objections"),
other than Permitted Liens, Purchaser shall advise the Company of the same in
writing within ten (10) days after last receipt by Purchaser of the Title
Commitment (with all documents referred to in Schedule B thereto) and the Survey
(as revised or updated as may be required by Purchaser within 30 days after
receipt of the Title Commitment and Survey). Matters not objected to by
Purchaser within said period shall be deemed to be additional Permitted Liens.
As to any Title Objections, the Company may, but shall not be obligated to,
remedy such matters as are susceptible of being remedied and shall, within ten
(10) days after Purchaser gives the Company notice of its Title Objections,
deliver written notice to Purchaser of those Title Objections which it shall
remedy and those which it shall not remedy. Unless Purchaser elects to terminate
this Agreement in accordance with clause 4.08(b)(y) below, the Company shall, as
a condition to Purchaser's obligation to close hereunder, deliver to Purchaser a
Title Commitment and Survey revised to reflect that any Title Objections which
the Company has committed to remedy have been remedied to Purchaser's reasonable
satisfaction. If the Company elects not to remedy any Title Objection, Purchaser
shall have the option, which it shall exercise in writing within ten (10) days
of its receipt of the written notice from the Company, of (x) consummating the
transaction contemplated hereby and accepting such title as the Company holds,
without change in or to the terms hereof, unless such matters are encumbrances
or liens for an ascertainable amount, in which case the Company shall pay the
amount thereof to Purchaser in cash at the Closing, or (y) terminating this
Agreement and receiving a refund of all monies deposited hereunder. If Purchaser
fails to deliver the written notice required in the immediately preceding
sentence within the period prescribed thereby, such failure shall be deemed an
irrevocable election by Purchaser to proceed to close the purchase and sale
contemplated by this Agreement in accordance with clause 4.08(b)(ix) above.
4.09 ACI'S GAMING COMPLIANCE PROGRAM. The Company, Parent and
their respective executive officers, directors and principal stockholders shall
fully cooperate with any background investigation with respect to each of them
required to be conducted by ACI pursuant to its Gaming Compliance Program to the
extent required by the Nevada Gaming Control Board.
4.10 FULFILLMENT OF CONDITIONS. The Company (a) will execute
and deliver at the Closing each certificate, document and instrument that the
Company is hereby required to execute and deliver as a condition to Closing, (b)
will take all commercially reasonable steps necessary or desirable and proceed
diligently and in good faith (i) to satisfy each condition to the obligations of
Purchaser contained in this Agreement and (ii) to consummate all of the
transactions contemplated by this Agreement, and (c) will not take or fail to
take any action that could reasonably be expected to result in the
nonfulfillment of any obligation of the Company or Purchaser contained in this
Agreement.
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4.11 NONCOMPETITION.
(a) TERM. The Company and Parent hereby covenant with
Purchaser that from the Closing Date until the date that is three (3) years
following the Closing Date, none of the Company, Parent or their respective
subsidiaries shall (except as otherwise specifically permitted herein), directly
or indirectly, for their own account, or as a partner, member, advisor or agent
of any partnership or joint venture, or as a trustee, officer, director,
shareholder, advisor or agent of any corporation, trust, or other business
organization or entity, own, manage, join, participate in, encourage, support,
finance, be engaged in, have an interest in, give financial assistance or advice
to, permit Parent's name to be used in connection with or be concerned in any
way in the ownership, management, operation or control of any casino gaming
operation within one hundred (100) miles of the facilities of the Business as of
the Effective Date other than a Currently Existing Gaming Operation (as such
operations may be expanded from time to time) PROVIDED that (i) such operation
shall not conduct casino gaming under the "Station Casinos" name, or any
derivative thereof, (ii) such entity is acquired by or becomes affiliated with
Parent or its subsidiaries as a result of a transaction between an entity that
has assets other than such Currently Existing Gaming Operation (the "COMPETING
GROUP") and Parent or such subsidiary and (iii) either (A) EBITDA of such
operation for the immediately preceding four fiscal quarters shall not be
greater than 30% of the consolidated EBITDA of the Competing Group for the
immediately preceding four fiscal quarters or (B) Parent or the Competing Group
pays Purchaser an amount equal to $10 million no later than ten (10) Business
Days following consummation of the transaction between Parent and the Competing
Group. For purposes of this Agreement, "Currently Existing Gaming Operation"
shall mean a gaming operation that is owned or operated by third parties prior
to the acquisition of ownership or commencement of operations thereof by the
Company, Parent or their Affiliates. Each of the Company and Parent also hereby
covenants that it shall not, for a period of eighteen (18) months after the
Closing Date, solicit or encourage any employee, agent, consultant or
independent contractor of Purchaser to terminate or curtail his or her
relationship with Purchaser.
(b) REMEDIES. The parties agree that the remedy of the
Purchaser at law for any actual or threatened breach of this SECTION 4.11 by the
Company or Parent would be inadequate and that, in the event of such actual or
threatened breach, in addition to any other remedy available to it, Purchaser
shall be entitled to specific performance hereof, injunctive relief, or both, by
temporary or permanent injunction or other appropriate judicial remedy, writ or
order. The remedies provided for in this SECTION 4.11 are non-exclusive and are
in addition to each other and to any other remedy available elsewhere in this
Agreement or available generally at law or in equity.
(c) DIVISIBILITY. If any portion of this SECTION 4.11 is held
to be unreasonable, arbitrary or against public policy, provisions of this
SECTION 4.11 shall be considered divisible both as to time and as to
geographical areas; and each month of each year of the specified period shall be
deemed to be a separate period of time. In the event any court determines the
specified time period or geographical area to be unreasonable, arbitrary or
against public policy, the lesser time period or geographical area which is
determined to be reasonable, non-arbitrary and not against public policy may be
enforced. Notwithstanding the foregoing, the Company and Parent agree to honor
the terms of this SECTION 4.11 for the time periods and areas specified herein
and not to contest the enforceability of such periods or areas.
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(d) PERMITTED OWNERSHIP. Notwithstanding any language to the
contrary contained in this SECTION 4.11, it shall be permissible for the Company
and Parent to own stock or securities of any company which may be deemed
competitive with Purchaser providing such shares or securities held by the
Company or Parent are issued by a company listed on a national securities
exchange or the NASDAQ Automated Quotation System and represent less than a five
percent (5%) interest in such company.
4.12 NO SOLICITATION. For a period of twelve (12) months
following the Closing Date, Parent, the Company and their respective Affiliates
shall refrain from, either alone or in conjunction with any other Person,
directly or indirectly, soliciting for hire any employee of Purchaser or any
Affiliate of Purchaser except as contemplated pursuant to the terms of that
certain Asset Purchase Agreement dated as of October 17, 2000, by and among Lake
Xxxx Station, Inc., Parent, Ameristar Casino Las Vegas, Inc. and ACI; provided,
however, that the Company shall not be prohibited from soliciting for employment
any Person whose employment with Purchaser or any of its Affiliates terminated
prior to such solicitation.
ARTICLE V
COVENANTS OF PURCHASER
Purchaser covenants and agrees with the Company that, at all
times from and after the date hereof until the Closing and, in the case of
SECTIONS 5.04, 5.05, 5.06, 5.07, and 5.08 below, thereafter, Purchaser will
comply with all covenants and provisions of this ARTICLE V, except to the extent
the Company may otherwise consent in writing.
5.01 REGULATORY AND OTHER APPROVALS. Purchaser will as
promptly as practicable (a) take all steps necessary or desirable to obtain all
consents, approvals, actions, orders or authorizations of, or make all
registrations, declarations or filings with and give all notices to Governmental
or Regulatory Authorities or any other Person required of Purchaser to
consummate the transactions contemplated hereby and will diligently and in good
faith strive to obtain the same including, without limitation, (i) making all
necessary filings under the HSR Act with the Federal Trade Commission and the
Department of Justice no later than seven (7) days following the date hereof
(ii) making all necessary filings with the Commission no later than fifteen (15)
days following the date hereof, and (iii) no later than ten (10) days following
the Effective Date, making all necessary filings and requesting consents from
and, to the extent required to obtain consents, hearings with the U.S. Corps of
Engineers and the Missouri Department of Natural Resources, (b) provide such
other information and communications to such Governmental or Regulatory
Authorities or other Persons as such Governmental or Regulatory Authorities or
other Persons may request in connection therewith and (c) provide cooperation to
the Company in connection with the performance of their obligations under
SECTIONS 4.01 and 4.02 above. The parties acknowledge and agree that so long as
the Purchaser complies with clauses (a) and (b) of the foregoing sentence, any
failure or refusal by the Commission to grant to Purchaser a Class A gaming
license to operate the Business shall not be deemed to be a breach of the
obligations of Purchaser or Parent hereunder; provided that nothing contained
herein shall limit the obligations of Purchaser to comply with any other
covenant or agreement contained in this Agreement or shall relieve Purchaser
from liability for any breach of a representation or warranty contained in this
Agreement. Purchaser will provide prompt written
31
notification to the Company when any such consent, approval, action, order,
authorization, registration, declaration, filing or notice referred to in clause
(a) above is obtained, taken, made or given, as applicable, and will advise the
Company of any communications (and, unless precluded by Law, provide copies of
any such communications that are in writing) with any Governmental or Regulatory
Authority or other Person regarding any of the transactions contemplated by this
Agreement.
5.02 HSR FILINGS. In addition to and without limiting
Purchaser's covenants contained in SECTION 5.01 above, Purchaser will (a) take
promptly all actions necessary to make the filings required of Purchaser or its
Affiliates under the HSR Act and in any event no later than seven (7) days
following the date hereof, (b) comply at the earliest practicable date with any
request for additional information received by Purchaser or its Affiliates from
the Federal Trade Commission or the Antitrust Division of the Department of
Justice pursuant to the HSR Act and (c) cooperate with the Company in connection
with the Company's filing under the HSR Act and in connection with resolving any
investigation or other inquiry concerning the transactions contemplated by this
Agreement commenced by either the Federal Trade Commission or the Antitrust
Division of the Department of Justice or state attorneys general. Purchaser
shall pay the Filing Fee, if any, required under the HSR Act.
5.03 INVESTIGATION BY THE COMPANY. Purchaser will provide the
Company and their respective Representatives with such documentation, data and
other information as the Company may reasonably request in order to verify
Purchaser's representations and warranties set forth in Section 3.07 above, but
only to the extent that furnishing any such documentation, data or information
would not violate any Law, Order, Contract or License applicable to Purchaser.
5.04 NO SOLICITATION. Purchaser will, for a period of eighteen
(18) months following the Closing Date, except as expressly permitted or
required by ARTICLE IX of this Agreement, refrain from, either alone or in
conjunction with any other Person, directly or indirectly, through its present
of future Affiliates, soliciting for hire any employee of the Company or any
Affiliate of the Company; provided, however, that Purchaser shall not be
prohibited from soliciting for employment any Person whose employment with the
Company or any of its Affiliates terminated prior to such solicitation.
5.05 COLLECTION OF GAMING CHIPS AND TOKENS. Purchaser shall
redeem, in its capacity as the Company's agent if Purchaser has not elected to
acquire such chips and tokens pursuant to SECTION 1.01(b)(x) hereof, any gaming
chips or tokens (from any series in use as of or prior to the Transfer Time) of
the Company relating to the use and operation of the Business, which are
presented by patrons of the Business or Purchaser for payment within the
applicable Missouri statutory time periods for such redemptions. The Company's
gaming chips and tokens redeemed by Purchaser shall be reimbursed, at
Purchaser's election, as often as weekly for the first 30 Business Days
following the Closing Date, and thereafter as often as monthly, by the Company,
upon delivery by Purchaser to the Company of such gaming chips and tokens being
redeemed. The Company agrees to make arrangements for the additional redemption
of its gaming chips and tokens as may be required by Missouri law.
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5.06 VALET PARKING. At the Transfer Time, an authorized
representative of the Company shall perform the following functions for all
motor vehicles that were checked and placed in the care of the Company: (i) xxxx
all motor vehicles with a sticker or tape; (ii) prepare a report with respect to
any damages to such vehicles; (iii) prepare an inventory of such vehicles
("INVENTORIED VEHICLES") indicating the check number applicable thereto; and
(iv) transfer control of the Inventoried Vehicles to an authorized
representative of Purchaser and secure a receipt for the Inventoried Vehicles.
Thereafter, Purchaser shall be responsible for the Inventoried Vehicles,
PROVIDED that the Company shall be liable to the owners of such Inventoried
Vehicles with respect to any damages occurring as a result of actions taken by
the Company and its employees prior to the Transfer Time (including, without
limitation, damages (as a result of actions taken by the Company and its
employees) set forth in the damage report) or items missing from or damaged in
such Inventoried Vehicles and such liability shall be a Retained Liability for
the purposes of this Agreement, to the extent that Purchaser is able to prove
that such items were missing or damaged prior to the Transfer Time.
5.07 RETURN OF BOOKS AND RECORDS. Following the Closing Date,
upon the request of the Company, Purchaser shall return to the Company all Books
and Records relating to the Company that are not used primarily in the conduct
of the Business, including, without limitation, the Books and Records relating
to the businesses of Parent or its Affiliates (other than the Company).
5.08 USE OF TRANSFERRED INTELLECTUAL PROPERTY. Purchaser
agrees that neither it nor any of its Affiliates shall use any portion of the
Transferred Intellectual Property that prior to the Closing Date constituted
proprietary property of the Company in its operations in Xxxxx County, Nevada.
5.09 FULFILLMENT OF CONDITIONS. Purchaser (a) will execute and
deliver at the Closing each certificate, document and instruments that Purchaser
is hereby required to execute and deliver as a condition to the Closing, (b)
will as promptly as practicable affirmatively take all steps necessary or
desirable and proceed diligently and in good faith (i) to satisfy each other
condition to the obligations of the Company contained in this Agreement and (ii)
to consummate all of the transactions contemplated in this Agreement, and (c)
will not take or fail to take any action that could reasonably be expected to
result in the nonfulfillment of any obligation of the Company or Purchaser
contained in this Agreement.
ARTICLE VI
CONDITIONS TO OBLIGATIONS OF PURCHASER
The obligations of Purchaser hereunder to purchase the Assets
are subject to the fulfillment, at or before the Closing, of each of the
following conditions (all or any of which may be waived in whole or in part by
Purchaser in its sole discretion):
6.01 REPRESENTATIONS AND WARRANTIES. The representations and
warranties made by the Company and Parent in this Agreement shall be true and
correct, in all respects, on and as of the Closing Date as though made on and as
of the Closing Date or, in the case of representations and warranties made as of
a specified date earlier than the Closing Date, on and
33
as of such earlier date, except in each case as could not, either individually
or in the aggregate, reasonably be expected to have a Material Adverse Effect;
PROVIDED, HOWEVER, that for the purposes of determining the accuracy of such
representations and warranties, all "Material Adverse Effect" qualifications and
other materiality qualifications, and any similar qualifications, contained in
such representations and warranties shall be disregarded.
6.02 PERFORMANCE. The Company and Parent shall have performed
and complied with the agreements, covenants and obligations required by this
Agreement to be so performed or complied with by the Company, as the case may
be, at or before the Closing, except in each case as could not, individually or
in the aggregate, reasonably be expected to have a Material Adverse Effect.
6.03 OFFICERS' CERTIFICATES. The Company and Parent shall have
delivered to Purchaser a certificate, dated the Closing Date and executed in the
name and on behalf of the Company by an executive officer of the Company and on
behalf of the Parent by an executive officer of the Parent, substantially in the
form and to the effect of EXHIBIT C hereto, and certificates, dated the Closing
Date and executed by the Secretary of the Company and the Secretary of Parent,
substantially in the form and to the effect of EXHIBIT D hereto.
6.04 ORDERS AND LAWS. There shall not be in effect at the time
of Closing any Order or Law restraining, enjoining or otherwise prohibiting or
making illegal the consummation of any of the transactions contemplated by this
Agreement.
6.05 REGULATORY CONSENTS AND APPROVALS. All consents,
approvals, actions, orders or authorizations of, all registrations, declarations
or filings with and all notices to any Governmental or Regulatory Authority
necessary to permit Purchaser and the Company to perform their respective
obligations under this Agreement and to consummate the transactions contemplated
hereby shall have been duly obtained, made or given and shall be in full force
and effect, and all terminations or expirations of waiting periods imposed by
any Governmental or Regulatory Authority necessary for the consummation of the
transactions contemplated by this Agreement, including under the HSR Act, shall
have occurred, except for such consents, approvals, actions, orders or
authorizations the failure of which to obtain could not be reasonably expected
to have a Material Adverse Effect.
6.06 CONSUMMATION OF RELATED TRANSACTION. The transactions
contemplated by the St. Xxxxxxx Riverfront Station, Inc. Agreement shall be
consummated substantially concurrently with the consummation of the transactions
contemplated hereby.
6.07 DELIVERIES. The Company shall have delivered to Purchaser
the General Assignment and other Assignment Instruments.
6.08 TITLE INSURANCE AND ENVIRONMENTAL REPORTS. Purchaser
shall have received (a) the Title Policy (as defined and described in SECTION
4.08 hereof) and (b) recently completed Phase I environmental assessment reports
with respect to the Real Property.
6.09 CONSENTS.
34
With respect to each Contract set forth in SECTION 6.09 OF THE
DISCLOSURE SCHEDULE, the Company shall have obtained and delivered to Purchaser
a consent from the relevant third parties to the extent required for the
assignment of such Contract to Purchaser.
6.10 ABSENCE OF MATERIAL ADVERSE EFFECT. Since the date
hereof, there shall not have occurred any Material Adverse Effect or any events
or series of events that constitute a Material Adverse Effect.
ARTICLE VII
CONDITIONS TO OBLIGATIONS OF THE COMPANY
The obligations of the Company hereunder to sell the Assets
are subject to the fulfillment, at or before the Closing, of each of the
following conditions (all or any of which may be waived in whole or in part by
the Company in its sole discretion):
7.01 REPRESENTATIONS AND WARRANTIES. The representations and
warranties made by Purchaser in this Agreement shall be true and correct in all
material respects on and as of the Closing Date as though made on and as of the
Closing Date or, in the case of representations and warranties made as of a
specified date earlier than the Closing Date, on and as of such earlier date,
except in each case as could not, either individually or in the aggregate,
reasonably be expected to have a Material Adverse Effect; PROVIDED, HOWEVER,
that for the purposes of determining the accuracy of such representations and
warranties, all "Material Adverse Effect" qualifications and other materiality
qualifications, and any similar qualifications, contained in such
representations and warranties shall be disregarded..
7.02 PERFORMANCE. Purchaser shall have performed and complied
with, in all material respects, the agreements, covenants and obligations
required by this Agreement to be so performed or complied with by Purchaser at
or before the Closing.
7.03 OFFICERS' CERTIFICATES. Purchaser and ACI shall have
delivered to the Company certificates, dated the Closing Date and executed in
the name and on behalf of Purchaser and ACI by the executive officer of
Purchaser and ACI, respectively, substantially in the form and to the effect of
EXHIBIT E-1 and EXHIBIT E-2 hereto, and certificates, dated the Closing Date and
executed by the Secretary of Purchaser and ACI, respectively, substantially in
the form and to the effect of EXHIBIT F-1 and EXHIBIT F-2 hereto.
7.04 ORDERS AND LAWS. There shall not be in effect at the time
of Closing any Order or Law restraining, enjoining or otherwise prohibiting or
making illegal the consummation of any of the transactions contemplated by this
Agreement.
7.05 REGULATORY CONSENTS AND APPROVALS. All consents,
approvals and actions of, filings with and notices to any Governmental or
Regulatory Authority necessary to permit the Company and Purchaser to materially
perform their obligations under this Agreement and to consummate the
transactions contemplated hereby, shall have been duly obtained, made or given,
shall be in full force and effect and shall be in form and substance
satisfactory to the Company and not subject to any material condition or
contingency and all terminations or expirations of waiting periods imposed by
any Governmental or Regulatory Authority necessary
35
for the consummation of the transactions contemplated by this Agreement,
including under the HSR Act, shall have occurred.
7.06 CONSUMMATION OF RELATED TRANSACTION. The transactions
contemplated by the Kansas City Station Corporation Agreement shall be
consummated substantially concurrently with the consummation of the transactions
contemplated hereby.
7.07 DELIVERIES. Purchaser shall have delivered the Assumption
Agreement and other Assumption Instruments.
7.08 REQUIRED CONSENTS. The third party consents listed in
SECTION 7.08 OF THE DISCLOSURE SCHEDULE shall have been obtained and shall not
have been revoked.
ARTICLE VIII
TAX MATTERS AND POST-CLOSING TAXES
8.01 TRANSFER TAXES AND TRANSFER FEES. The Company shall pay
all sales, use, transfer, real property transfer, recording, stock transfer and
other similar taxes and fees (other than Taxes of Purchaser and its Affiliates
based upon or measured by net income or gains) ("TRANSFER TAXES") arising out of
or in connection with the transactions effected pursuant to this Agreement, and
shall indemnify, defend, and hold harmless Purchaser and its Affiliates with
respect to such Transfer Taxes. The Company and Purchaser shall equally share
the costs of Gaming Device transfer fees. The Company shall file all necessary
documentation and Tax Returns with respect to such Transfer Taxes.
8.02 TAX INDEMNIFICATION.
(a) Subject to SECTION 1.06, after the Closing Date, the
Company and Parent will indemnify and hold harmless Purchaser from and against
any and all claims, actions, causes of action, liabilities, losses, damages, and
reasonable out-of-pocket expenses and costs resulting from, arising out of or
relating to any Taxes of, or with respect to, the Company (including, without
limitation, any Tax liability that arises solely by reason of Company being
severally liable for any Tax of any federal or state or local consolidated or
combined group of which it is a member pursuant to Treasury Regulation
ss.1.1502-6 or any analogous state or local Tax provision) or with respect to
the income, assets or operation of the Business or the Assets for all taxable
periods ending on or before the Closing Date and that portion of any taxable
period including and ending on the Closing Date that ends on or after the
Closing Date (determined as if the relevant period ended on the Closing Date) in
excess of the amount of such Taxes shown as Accrued Expenses on the Closing
Balance Sheet.
(b) Purchaser will be responsible for and indemnify and hold
the Company harmless against any all liabilities with respect to Taxes relating
to the Assets for all taxable periods beginning on the Closing Date and ending
after the Closing Date other than to the extent such Taxes relate to or result
from a breach of a representation set forth in Section 2.06, and other than
Taxes for which the Company is responsible pursuant to SECTIONS 1.06, 8.01 and
8.02(a) above.
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(c) For purposes of clarification, the obligations of the
Company, Parent and Purchaser pursuant to this SECTION 8.02 shall not be subject
to the limits contained in SECTION 11.01(c)(i) hereof.
8.03 TAX COOPERATION. After the Closing Date, the Company and
Parent will cooperate with Purchaser, and Purchaser will cooperate with the
Company and Parent, in the preparation of all Tax Returns and will provide (or
cause to be provided) any records and other information the other so requests,
and will provide access to, and the cooperation of its auditors. The Company and
Parent will cooperate with Purchaser and Purchaser will cooperate with the
Company and Parent in connection with any Tax investigation, audit or other
proceeding.
8.04 NOTIFICATION OF PROCEEDINGS; CONTROL. The Company shall
have the right to control any audit or examination relating to Taxes by any
taxing authority, initiate any claim for refund, file any amended return,
contest, resolve and defend against any assessment, notice of deficiency or
other adjustment or proposed adjustment relating or with respect to any Taxes of
any company for which the Company is responsible pursuant to SECTION 8.02 and
shall be entitled to all refunds with respect to such taxes.
ARTICLE IX
EMPLOYEE BENEFITS MATTERS
9.01 OFFER OF EMPLOYMENT.
(a) The parties hereto intend that there shall be continuity
of employment with respect to all of the employees of the Business. Subject to
Purchaser's (or its Affiliates') ordinary ninety-day orientation period,
Purchaser shall offer employment at will, commencing on the Closing Date, to all
employees, including those on vacation, leave of absence or disability, who were
employed by the Business immediately prior to Closing, on substantially the same
terms in the aggregate (including salary, fringe benefits, job responsibility
and location but excluding employee stock ownership and incentive plans) as
those provided to similar employees of Purchaser (or its Affiliates) immediately
prior to Closing to the extent permitted under applicable law. Those persons who
accept Purchaser's offer of employment and commence working with Purchaser on
the Closing Date shall hereafter be referred to as "TRANSFERRED EMPLOYEES." The
parties hereto agree that nothing in this Agreement shall limit Purchaser's
ability after the Closing Date to modify or terminate (i) the employment of any
Transferred Employee or (ii) any benefit policy, plan or program offered to or
covering any Transferred Employee.
(b) Prior to, or in connection with, the Closing, Purchaser
shall take no action to cause the Company or the Business to terminate the
employment of any employee of the Business, and neither the Company nor the
Business shall be under any obligation to terminate any employee of the Business
prior to or on the Closing Date. Purchaser shall be liable for any amounts to
which any employee of the Business may become entitled pursuant to any
employment or severance contract as a result of, or in connection with, the sale
of the Business hereunder. Purchaser agrees that it will not take any action
which would give rise to liability under WARN or any similar state, local or
federal Law or regulation.
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9.02 WELFARE PLANS -- CLAIMS INCURRED; PRE-EXISTING
CONDITIONS.
(a) Notwithstanding any provision of this Agreement to the
contrary, the Company shall retain responsibility for and continue to pay all
medical, life insurance, disability and other welfare plan expenses and benefits
for each Transferred Employee with respect to claims incurred by such
Transferred Employees or their covered dependents prior to the Closing Date.
Notwithstanding any provision of this Agreement to the contrary, expenses and
benefits with respect to claims incurred by Transferred Employees or their
covered dependents on or after the Closing Date shall be the responsibility of
Purchaser. For purposes of this paragraph, a claim is deemed incurred when the
services that are the subject of the claim are performed; in the case of life
insurance, when the death occurs, in the case of long-term disability benefits,
when the disability occurs and, in the case of a hospital stay, when the
employee first enters the hospital.
(b) With respect to any welfare benefit plans (as defined in
Section 3(1) of ERISA) maintained by Purchaser for the benefit of Transferred
Employees on and after the Closing Date, Purchaser shall (i) use commercially
reasonable efforts to cause there to be waived any pre-existing condition
limitations (other than those limitations existing under the Company's welfare
benefit plans) and (ii) give effect, in determining any deductible and maximum
out-of-pocket limitations, to claims incurred and amounts paid by, and amounts
reimbursed to, such employees with respect to similar plans maintained by the
Company (and its Affiliates) for their benefit immediately prior to the Closing
Date.
9.03 VACATION. With respect to any accrued but unused vacation
time to which any Transferred Employee is entitled pursuant to the vacation
policy applicable to such employee immediately prior to the Closing Date (the
"VACATION POLICY"), Purchaser shall allow such Transferred Employee to use such
accrued vacation, subject to the terms and conditions of Purchaser's vacation
policy; PROVIDED, HOWEVER, that if Purchaser deems it necessary to disallow such
Transferred Employee from taking such accrued vacation, Purchaser shall be
liable for and pay in cash to each such Transferred Employee an amount equal to
such vacation time in accordance with terms of the Vacation Policy; PROVIDED,
FURTHER, that Purchaser shall be liable for and pay in cash an amount equal to
any remaining accrued vacation time to any Transferred Employee whose employment
terminates for any reason prior to the close of business on the last calendar
day of the year during which the Closing Date occurs.
9.04 SERVICE CREDIT. Purchaser will provide, for the purposes
of eligibility and vesting (but not for benefit accrual) each Transferred
Employee with credit for all service with the Company and its Affiliates to the
extent possible under each employee benefit plan, program, or arrangement of
Purchaser or its Affiliates in which such employee is eligible to participate;
provided, however, that in no event shall any employee be entitled to any credit
to the extent that it would result in a duplication of benefits with respect to
the same period of service.
9.05 COMPANY'S BENEFIT PLANS. Except as provided in this
Agreement, the parties hereto agree that Purchaser shall not assume any Benefit
Plan and the Company shall retain and be responsible for any cost, expense,
liability, damage or obligation relating to any Benefit Plan, whether arising
before, on or after the Closing Date.
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9.06 COBRA MATTERS. The Company agrees to provide and be fully
responsible for the continuation coverage required by Section 4980B of the Code
and Sections 601 through 608 of ERISA ("COBRA") for all employees and former
employees of the Company and their covered beneficiaries who incurred or will
incur a qualifying event prior to the Closing Date, or will incur a qualifying
event as a result of the consummation of the transactions contemplated herein,
and who are entitled to COBRA coverage as a result thereof.
ARTICLE X
SURVIVAL OF REPRESENTATIONS
10.01 SURVIVAL OF REPRESENTATIONS, WARRANTIES, COVENANTS AND
AGREEMENTS. Except for (i) this ARTICLE X, SECTIONS 2.06, 5.05, 5.06, 5.07, and
5.08 above, ARTICLES VIII and IX above, SECTIONS 14.03, 14.04 and 14.07 below
and the Company's agreements and covenants with respect to Retained Liabilities,
which shall survive and remain enforceable indefinitely, (ii) SECTIONS 4.06,
4.11 AND 5.04 which shall survive for the period set forth therein, and (iii)
SECTIONS 2.10 and 2.15 which shall survive and remain enforceable for a period
of five (5) years following the Closing Date, the representations, warranties,
agreements and covenants contained in this Agreement shall survive the Closing
for a period of eighteen (18) months following the Closing Date, after which
time there shall be no liability in respect thereof on the part of either party
or its officers, directors, employees, agents and Affiliates.
10.02 NO OTHER REPRESENTATIONS. Notwithstanding anything to
the contrary contained in this Agreement, but subject to SECTION 10.01 above, it
is the explicit intent of each party hereto that the Company and Purchaser are
making no representation or warranty whatsoever, express or implied, except
those representations and warranties contained in ARTICLE II above and in any
certificate delivered pursuant to SECTION 6.03 above. It is understood that,
except to the extent otherwise expressly provided herein, Purchaser takes the
Assets "as is" and "where is." In particular, the Company and Parent make no
representation or warranty to Purchaser with respect to the information set
forth in the Xxxxxxxxxxx Xxxxxxx & Co., Inc. offering memorandum relating to the
Company, or (y) any financial projection or forecast relating to the Company.
With respect to any projection or forecast delivered by or on behalf of the
Company to Purchaser, Purchaser acknowledges that (i) there are uncertainties
inherent in attempting to make such projections and forecasts, (ii) it is
familiar with such uncertainties, (iii) it is taking full responsibility for
making its own evaluation of the adequacy and accuracy of all such projections
and forecasts furnished to it and (iv) it shall have no claim against the
Company or Parent with respect thereto.
ARTICLE XI
INDEMNIFICATION
11.01 OTHER INDEMNIFICATION.
(a) Subject to PARAGRAPH (c) of this Section and the other
Sections of this ARTICLE XI, the Company and Parent shall jointly and severally
indemnify the Purchaser
39
Indemnified Parties in respect of, and hold it harmless from and against, any
and all Losses suffered, incurred or sustained by any of them or to which any of
them becomes subject, resulting from, arising out of or relating to (i) any
breach of representation or warranty or nonfulfillment of or failure to perform
any covenant or agreement on the part of the Company or Parent contained in this
Agreement, or (ii) a Retained Liability;
(b) Subject to the other Sections of this ARTICLE XI,
Purchaser shall indemnify the Company Indemnified Parties in respect of, and
hold each of them harmless from and against, any and all Losses suffered,
incurred or sustained by any of them or to which any of them becomes subject,
resulting from, arising out of or relating to (i) any breach of representation
or warranty or nonfulfillment of or failure to perform any covenant or agreement
on the part of Purchaser contained in this Agreement or (ii) an Assumed
Liability;
(c) Notwithstanding anything to the contrary contained in this
Agreement, no amounts of indemnity shall be payable as a result of any claim in
respect of a Loss arising under PARAGRAPH (a)(i) or (b)(i), as applicable, of
SECTION 11.01 (other than a claim based on fraud or willful misconduct or for or
with respect breaches of SECTION 2.06 hereof or claims under ARTICLE VIII
hereof):
(i) unless, until and then only to the extent that
the Purchaser Indemnified Parties or the Company Indemnified Parties, as
applicable, have suffered, incurred, sustained or become subject to Losses
referred to in such paragraph in excess of one hundred thousand dollars
($100,000) in the aggregate;
(ii) unless and to the extent that the Purchaser
Indemnified Parties and the Purchaser Indemnified Parties as defined in the
Kansas City Station Corporation Agreement or the Company Indemnified Parties and
the Company Indemnified Parties as defined in the Kansas City Station
Corporation Agreement, as applicable, have not received payments in respect of
claims made under Section 11.01(a)(i) of this Agreement and the Kansas City
Station Corporation Agreement or Section 11.01(b)(i) of this Agreement and the
Kansas City Station Corporation Agreement, respectively, in excess of Twenty
Million Dollars ($20,000,000) in the aggregate;
(iii) unless the Indemnified Party has given the
Indemnifying Party a Claim Notice or Indemnity Notice, as applicable, with
respect to such claim, setting forth in reasonable detail the specific facts and
circumstances pertaining thereto, (A) as soon as practical following the time at
which the Indemnified Party discovered or reasonably should have discovered such
claim (except to the extent the Indemnifying Party is not prejudiced by any
delay in the delivery of such notice) and (B) in any event prior to the
applicable Cut-off Date; or
(iv) to the extent that the Indemnified Party had a
reasonable opportunity, but failed, in good faith to mitigate such Loss,
including, without limitation, to the failure to use commercially reasonable
efforts to recover under a policy of insurance or under a contractual right of
set off or indemnity.
11.02 METHOD OF ASSERTING CLAIM. All claims for
indemnification by any Indemnified Party under SECTION 11.01 will be asserted
and resolved as follows:
40
(a) In the event any claim or demand in respect of which an
Indemnified Party might seek indemnity under SECTION 11.01 is asserted against
or sought to be collected from such Indemnified Party by a Person other than the
Company, Parent, ACI, Purchaser or any Affiliate of the Company or of Purchaser
(a "THIRD PARTY CLAIM"), the Indemnified Party shall deliver a Claim Notice with
reasonable promptness to the Indemnifying Party. The Indemnifying Party will
notify the Indemnified Party as soon as practicable within the Dispute Period
whether the Indemnifying Party disputes its liability to the Indemnified Party
under SECTION 11.01 and whether the Indemnifying Party desires, at its sole cost
and expense, to defend the Indemnified Party against such Third Party Claim,
PROVIDED that failure to give such notice shall not relieve the Indemnifying
Party of its obligations hereunder except to the extent it shall have been
prejudiced by such failure.
(i) If the Indemnifying Party notifies the Indemnified Party
within the Dispute Period that the Indemnifying Party desires to defend
the Indemnified Party with respect to the Third Party Claim pursuant to
this SECTION 11.02(a), then the Indemnifying Party will have the right
to defend, at the sole cost and expense of the Indemnifying Party, such
Third Party Claim by all appropriate proceedings, which proceedings
will be vigorously and diligently prosecuted by the Indemnifying Party
to a final conclusion or will be settled at the discretion of the
Indemnifying Party. The Indemnifying Party will have full control of
such defense and proceedings, including that if requested by the
Indemnifying Party, the Indemnified Party will, at the sole cost and
expense of the Indemnifying Party, reasonably cooperate with the
Indemnifying Party and its counsel in contesting any Third Party Claim
that the Indemnifying Party elects to contest, or, if appropriate and
related to the Third Party Claim in question, in making any
counterclaim against the Person asserting the Third Party Claim, or any
cross-complaint against any Person (other than the Indemnified Party or
any of its Affiliates); PROVIDED that the Indemnified Party may
participate in such settlement or defense through counsel chosen by
such Indemnified Party and paid at its own expense; and PROVIDED
FURTHER that, if in the opinion of counsel for such Indemnified Party,
there is a reasonable likelihood of a conflict of interest between the
Indemnifying Party and the Indemnified Party, the Indemnifying Party
shall be responsible for reasonable fees and expenses of one counsel to
such Indemnifying Party in connection with such defense.
Notwithstanding the foregoing, the Indemnified Party may retain or take
over the control of the defense or settlement of any Third Party Claim
the defense of which the Indemnifying Party has elected to control if
the Indemnified Party irrevocably waives its right to indemnity under
SECTION 11.01 with respect to such Third Party Claim.
(ii) If the Indemnifying Party fails to notify the Indemnified
Party within the Dispute Period that the Indemnifying Party desires to
defend the Third Party Claim pursuant to SECTION 11.02(a), then the
Indemnified Party will have the right to defend, at the sole cost and
expense of the Indemnifying Party, the Third Party Claim by all
appropriate proceedings, which proceedings will be vigorously and
diligently prosecuted by the Indemnified Party to a final conclusion or
will be settled at the discretion of the Indemnified Party (with the
consent of the Indemnifying Party, which consent will not be
unreasonably withheld). The Indemnified Party will have full control of
such defense and proceedings, including (except as provided in the
immediately preceding sentence) any settlement thereof; PROVIDED,
HOWEVER, that if requested by the Indemnified Party, the
41
Indemnifying Party will, at the sole cost and expense of the
Indemnifying Party, cooperate with the Indemnified Party and its
counsel in contesting any Third Party Claim which the Indemnified Party
is contesting, or, if appropriate and related to the Third Party Claim
in question, in making any counterclaim against the Person asserting
the Third Party Claim, or any cross-complaint against any Person (other
than the Indemnifying Party or any of its Affiliates). Notwithstanding
the foregoing provisions of this clause (ii), if the Indemnifying Party
has notified the Indemnified Party within the Dispute Period that the
Indemnifying Party disputes its liability hereunder to the Indemnified
Party with respect to such Third Party Claim and if such dispute is
resolved in favor of the Indemnifying Party in the manner provided in
clause (iii) below, the Indemnifying Party will not be required to bear
the costs and expenses of the Indemnified Party's defense pursuant to
this clause (ii) or of the Indemnifying Party's participation therein
at the Indemnified Party's request, and the Indemnified Party will
reimburse the Indemnifying Party in full for all reasonable costs and
expenses incurred by the Indemnifying Party in connection with such
litigation. The Indemnifying Party may retain separate counsel to
represent it in, but not control, any defense or settlement controlled
by the Indemnified Party pursuant to this clause (ii), and the
Indemnifying Party will bear its own costs and expenses with respect to
such participation.
(iii) If the Indemnifying Party notifies the Indemnified Party
that it does not dispute its liability to the Indemnified Party with
respect to the Third Party Claim under SECTION 11.02 or fails to notify
the Indemnified Party within the Dispute Period whether the
Indemnifying Party disputes its liability to the Indemnified Party with
respect to such Third Party Claim, the Loss arising from such Third
Party Claim will be conclusively deemed a liability of the Indemnifying
Party under SECTION 11.01 and the Indemnifying Party shall pay the
amount of such Loss to the Indemnified Party on demand following the
final determination thereof. If the Indemnifying Party has timely
disputed its liability with respect to such claim, the Indemnifying
Party and the Indemnified Party will proceed in good faith to negotiate
a resolution of such dispute, and if not resolved through negotiations
within the Resolution Period, such dispute shall be resolved by
arbitration in accordance with paragraph (c) of this SECTION 11.02.
(b) In the event any Indemnified Party should have a claim
under SECTION 11.02 against any Indemnifying Party that does not involve a Third
Party Claim, the Indemnified Party shall deliver an Indemnity Notice with
reasonable promptness to the Indemnifying Party. If the Indemnifying Party
notifies the Indemnified Party that it does not dispute the claim described in
such Indemnity Notice or fails to notify the Indemnified Party within the
Dispute Period whether the Indemnifying Party disputes the claim described in
such Indemnity Notice, the Loss arising from the claim specified in such
Indemnity Notice will be conclusively deemed a liability of the Indemnifying
Party under SECTION 11.01 and the Indemnifying Party shall pay the amount of
such Loss to the Indemnified Party on demand following the final determination
thereof. If the Indemnifying Party has timely disputed its liability with
respect to such claim, the Indemnifying Party and the Indemnified Party will
proceed in good faith to negotiate a resolution of such dispute, and if not
resolved through negotiations within the Resolution Period, such dispute shall
be resolved by arbitration in accordance with paragraph (c) of this SECTION
11.02.
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(c) Any dispute submitted to arbitration pursuant to this
SECTION 11.02 shall be finally and conclusively determined by the decision of a
panel of three arbitrators (hereinafter sometimes called the "BOARD OF
ARBITRATION") selected as herein provided. Each of the Indemnified Party and the
Indemnifying Party shall select one (1) member and the third member shall be
selected by mutual agreement of the other members, or if the other members fail
to reach agreement on a third member within twenty (20) days after their
selection, such third member shall thereafter be selected by the American
Arbitration Association (the "AAA") upon application made to it jointly by the
Indemnified Party and the Indemnifying Party for a third member possessing
expertise or experience appropriate to the dispute. Within 120 days of the
selection of the Board of Arbitration, the Indemnified Party and the
Indemnifying Party shall meet in Las Vegas, Nevada with such Board of
Arbitration at a place and time designated by such Board of Arbitration after
consultation with such parties and present their respective positions on the
dispute. The arbitration proceeding shall be held in accordance with the rules
for commercial arbitration of the AAA in effect on the date of the initial
request for appointment of the Board of Arbitration, that gave rise to the
dispute to be arbitrated (as such rules are modified by the terms of this
Agreement or may be further modified by mutual agreement of the parties). Each
party shall have no longer than five (5) days to present its position, the
entire proceedings before the Board of Arbitration shall be no more than ten
consecutive days, and the decision of the Board of Arbitration shall be made in
writing no more than thirty (30) days following the end of the proceeding. Such
an award shall be a final and binding determination of the dispute and shall be
fully enforceable as an arbitration decision in any court having jurisdiction
and venue over such parties. The prevailing party (as determined by the Board of
Arbitration) shall in addition be awarded by the Board of Arbitration such
party's own attorneys' fees and expenses in connection with such proceeding. The
non-prevailing party (as determined by the Arbitrator) shall pay the Board of
Arbitration's fees and expenses.
(d) In the event of any claim for indemnity under SECTION
11.02(a), Purchaser agrees to give the Company and its Representatives
reasonable access to the Books and Records and employees of the Company in
connection with the matters for which indemnification is sought to the extent
the Company reasonably deems necessary in connection with its rights and
obligations under this ARTICLE XI.
11.03 EXCLUSIVITY. After the Closing, to the extent permitted
by Law, the indemnities set forth in ARTICLE VIII and this ARTICLE XI shall be
the exclusive remedies of Purchaser, Parent and the Company and their respective
officers, directors, employees, agents and Affiliates for any misrepresentation,
breach of warranty or nonfulfillment or failure to be performed of any covenant
or agreement contained in this Agreement, and the parties shall not be entitled
to a rescission of this Agreement or to any further indemnification rights or
claims of any nature whatsoever in respect thereof, all of which the parties
hereto hereby waive; PROVIDED, HOWEVER, that no party hereto shall be deemed to
have waived any rights, claims, causes of action or remedies if and to the
extent such rights, claims, causes of action or remedies may not be waived under
applicable law or actual fraud or intentional misrepresentation is proven on the
part of a party by another party hereto.
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ARTICLE XII
TERMINATION
12.01 TERMINATION. This Agreement may be terminated, and the
transactions contemplated hereby may be abandoned:
(a) at any time before the Closing, by mutual written
agreement of the Company and Purchaser;
(b) at any time before the Closing without liability to the
terminating party, by the Company or the Purchaser, in the event that any Order
or Law becomes effective restraining, enjoining or otherwise prohibiting or
making illegal the consummation of any of the transactions contemplated by this
Agreement upon notification of the non-terminating party by the terminating
party and the terminating party is not then in material breach of this
Agreement;
(c) at any time before the Closing, by Company or Purchaser in
the event of a material breach of this Agreement by the non-terminating party if
such non-terminating party fails to cure such non-compliance or breach within
ten (10) Business Days following notification thereof by the terminating party;
(d) at any time after the date that is ninety (90) days
following the Effective Date (the "Initial Term"), without liability to the
terminating party, upon notification of the non-terminating party by the
terminating party if the Closing shall not have occurred on or before such date
and such failure to consummate is not caused by a breach of this Agreement by
the terminating party; PROVIDED that the Company may in its sole and absolute
discretion extend such period for up to three additional thirty (30) day
extension periods upon five (5) Business days' written notice to Purchaser prior
to the then applicable termination date; and PROVIDED, FURTHER, that if the sole
condition that remains unsatisfied as of the expiration of the then applicable
term (other than deliveries of closing certificates and other Closing documents)
is the receipt of a Class A license from the Commission and Purchaser
demonstrates to the reasonable satisfaction of the Company that (x) it has
sufficient cash on hand and/or availability under credit facilities to pay the
Purchase Price and make all other necessary payments of fees and expenses in
connection with the transactions contemplated by this Agreement and (y) it is
using commercially reasonable efforts to obtain such license and there are no
facts known to Purchaser or the Company that could be reasonably expected to
result in the failure to obtain such license, Purchaser may extend such period
for up to three additional thirty (30) day extension periods by providing
written notice to the Company on or before the date that is no more than ten
(10) Business Days and no less than five (5) Business Days prior to the then
applicable termination date.
12.02 EFFECT OF TERMINATION. If this Agreement is validly
terminated pursuant to the provisions of SECTION 12.01 above, this Agreement
will forthwith become null and void, and, except as set forth in the next
sentence, there will be no liability or obligation on the part of Parent, the
Company, Purchaser or ACI (or any of their respective officers, directors,
employees, agents or other representatives or Affiliates), except that the
provisions of SECTIONS 14.02, 14.03, 14.04 and 14.07 below will continue to
apply following any such termination. Notwithstanding
44
any other provision in the Agreement to the contrary, upon any termination of
this Agreement by any party pursuant to Section 12.01(c), the non-terminating
party shall remain liable to the terminating party for any and all willful
breaches of this Agreement and the terminating party may seek such remedies,
including damages and attorneys' fees, as are provided in this Agreement or as
are otherwise available at Law or in equity.
ARTICLE XIII
DEFINITIONS
13.01 DEFINED TERMS. As used in this Agreement, the following
defined terms have the meanings indicated below:
"ACCOUNTS PAYABLE" has the meaning ascribed to it in SECTION
1.02(a).
"ACCOUNTS RECEIVABLE" has the meaning ascribed to it in
SECTION 1.01(a).
"ACCRUED EXPENSES" has the meaning ascribed to it in SECTION
1.02(a).
"ACI" has the meaning ascribed to it in the forepart of this
Agreement.
"ACQUISITION PROPOSAL" has the meaning ascribed to it in
SECTION 4.07.
"ACTIONS OR PROCEEDINGS" means any action, suit, proceeding,
arbitration or Governmental or Regulatory Authority investigation.
"AFFILIATE" means any Person that directly, or indirectly
through one or more intermediaries, controls or is controlled by or is under
common control with the Person specified. For purposes of this definition,
control of a Person means the power, direct or indirect, to direct or cause the
direction of the management and policies of such Person whether by Contract or
otherwise and, in any event and without limitation of the previous sentence, any
Person owning ten percent (10%) or more of the voting securities of another
Person shall be deemed to control that Person.
"AGREEMENT" means this Asset Purchase Agreement and the
Exhibits, the Disclosure Schedule and the Schedules hereto and the certificates
delivered in accordance with SECTIONS 6.03 and 7.03, as the same shall be
amended from time to time.
"ASSETS" has the meaning ascribed to it in SECTION 1.01(a).
"ASSIGNMENT INSTRUMENTS" has the meaning ascribed to it in
SECTION 1.04.
"ASSUMED LIABILITIES" has the meaning ascribed to it in
SECTION 1.02(a).
"ASSUMPTION AGREEMENT" has the meaning ascribed to it in
SECTION 1.04.
"ASSUMPTION INSTRUMENTS" has the meaning ascribed to it in
SECTION 1.04.
45
"BENEFIT PLAN" means any Plan established by the Company, or
any predecessor or Affiliate of any of the foregoing, existing at the Closing
Date or at any time since December 31, 1997, to which the Company contributes or
has contributed, or under which any employee, former employee or director of the
Company or any dependent or beneficiary thereof is covered, is eligible for
coverage or has benefit rights.
"BOARD OF ARBITRATION" has the meaning ascribed to it in
SECTION 11.02(c).
"BOOKS AND RECORDS" means all files, documents, instruments,
papers, books and records relating primarily to the Business or Condition of the
Company, including, without limitation, financial statements, Tax Returns and
related work papers and letters from accountants, budgets, pricing guidelines,
ledgers, journals, deeds, title policies, minute books, stock certificates and
books, stock transfer ledgers, Contracts, Licenses, customer lists, computer
files and programs, retrieval programs, operating data and plans, environmental
studies, audits, plans, surveys, designs, models and specifications.
"BUSINESS" has the meaning ascribed to it in the forepart of
this Agreement.
"BUSINESS BOOKS AND RECORDS" has the meaning ascribed to it in
SECTION 1.01(a).
"BUSINESS CONTRACTS" has the meaning ascribed to it in SECTION
1.01(a).
"BUSINESS CUSTOMER LISTS" has the meaning ascribed to it in
SECTION 1.01(a).
"BUSINESS DAY" means a day other than Saturday, Sunday or any
day on which banks located in the States of location of the Company's principal
executive offices are authorized or obligated to close.
"BUSINESS LICENSES" has the meaning ascribed to it in SECTION
1.01(a).
"BUSINESS OR CONDITION OF THE COMPANY" means the business,
financial condition or results of operations of the Company.
"CERCLA" means the Comprehensive Environmental Response,
Compensation and Liability Act of 1980, as amended, and the rules and
regulations promulgated thereunder.
"CLAIM NOTICE" means written notification pursuant to SECTION
11.02(a) of a Third Party Claim as to which indemnity under SECTION 11.01 is
sought by an Indemnified Party, enclosing a copy of all papers served, if any,
and specifying the nature of and basis for such Third Party Claim and for the
Indemnified Party's claim against the Indemnifying Party under SECTION 11.01,
together with the amount or, if not then reasonably determinable, the estimated
amount, determined in good faith, of the Loss arising from such Third Party
Claim.
"CLOSING" means the closing of the transactions contemplated
by SECTION 1.04.
"CLOSING BALANCE SHEET" has the meaning ascribed to it in
SECTION 1.05(a).
46
"CLOSING DATE" means (a) the second Business Day after the day
on which the last of the conditions described in Articles VI and VII hereof
above has been obtained, made or given or has expired, as applicable, or (b)
such other date as Purchaser and the Company mutually agree upon in writing.
"CLOSING FINANCIAL STATEMENTS DELIVERY DATE" has the meaning
ascribed to it in SECTION 1.05(a).
"CODE" means the Internal Revenue Code of 1986, as amended,
and the rules and regulations promulgated thereunder.
"COMMISSION" has the meaning ascribed to it in SECTION
1.01(a)(iv).
"COMMON STOCK" means the common stock, no par value, of the
Company.
"COMPANY" has the meaning ascribed to it in the forepart of
this Agreement.
"COMPANY INDEMNIFIED PARTIES" means Parent, the Company and
their respective officers, directors, employees, agents and Affiliates.
"COMPANY PLANS" has the meaning ascribed to it in SECTION
2.09(a).
"COMPANY'S ACCOUNTANT" has the meaning ascribed to it in
SECTION 1.05(c).
"CONTRACT" means any agreement, lease, license, evidence of
Indebtedness, mortgage, indenture, security agreement or other contract.
"CUT-OFF DATE" means, with respect to any representation,
warranty, covenant or agreement contained in this Agreement, the date on which
such representation, warranty, covenant or agreement ceases to survive as
provided in SECTION 11.01, as applicable.
"DEFICIENCY" means the amount, if any, by which the Net
Current Assets as determined in accordance with SECTION 1.05 is a negative
number.
"DETERMINATION DATE" has the meaning ascribed to it in SECTION
1.05(c).
"DISCLOSURE SCHEDULE" means the record delivered to Purchaser
by the Company herewith and dated as of the date hereof, containing all lists,
descriptions, exceptions and other information and materials as are required to
be included therein by the Company pursuant to this Agreement, as said record
may be amended, supplemented or modified by the Company at any time prior to the
Closing without any liability to the Company other than that Purchaser shall
have the right for five (5) Business Days after such amendment, supplement or
modification of the Disclosure Schedule to terminate the Agreement based upon
such amendment, supplement or modification of the Disclosure Schedule if such
amendment, supplement or modification of the Disclosure Schedule reveals a
matter which would have a Material Adverse Effect. Reference herein to the
Disclosure Schedule shall mean and refer not only to the record itself, but to
all items, documents, agreements and instruments referenced therein and to the
content of each such item, document, agreement and instrument. Likewise,
reference herein to a certain Section of the
47
Disclosure Schedule shall refer not only to that portion of the Disclosure
Schedule, but to the items, documents, agreements and instruments referenced in
that Section and the contents of each such item, document, agreement and
instrument. Further, matters disclosed for the purpose of one Section of the
Disclosure Schedule shall constitute disclosure of such matters for the purposes
of all other Sections of the Disclosure Schedule. The duplication or
cross-referencing of any disclosures made in the Disclosure Schedule shall not,
in any instance or in the aggregate, effect a waiver of the foregoing sentence.
"DISPUTE PERIOD" means the period ending sixty (60) days
following receipt by an Indemnifying Party of either a Claim Notice or an
Indemnity Notice.
"EBITDA" means, with respect to any Person for any period, the
earnings before interest, taxes, depreciation and amortization of such Person
for such period.
"EFFECTIVE DATE" has the meaning ascribed to it in the
forepart of this Agreement.
"ENVIRONMENTAL CLAIM" has the meaning ascribed to it in
SECTION 2.15(c).
"ENVIRONMENTAL LAW" means any federal, state, or local law,
statute, code, ordinance, order, rule, regulation, judgment, decree, injunction,
writ, edict, award, authorization, or other legally binding and enforceable
requirement by any Governmental or Regulatory Authority relating to any
environmental, health or safety matters.
"ENVIRONMENTAL PERMITS" has the meaning ascribed to it in
SECTION 2.15(a).
"ERISA" means the Employee Retirement Income Security Act of
1974, as amended, and the rules and regulations promulgated thereunder.
"EXCLUDED ASSETS" has the meaning ascribed to it in SECTION
1.01(b).
"EXCLUDED BOOKS AND RECORDS" has the meaning ascribed to it in
SECTION 1.01(b).
"FINANCIAL STATEMENT DATE" means December 31, 1999.
"FINANCIAL STATEMENTS" means the combined financial statements
of the Company delivered to Purchaser pursuant to SECTION 2.05.
"GAAP" means generally accepted accounting principles,
consistently applied throughout the specified period and in the immediately
prior comparable period.
"GAMING DEVICES" means any gambling games or implements of
gaming (as such terms are used in the applicable gaming statutes and regulations
of the State of Missouri) that is an asset or property of the Company and is not
an Excluded Asset.
"GENERAL ASSIGNMENT" has the meaning ascribed to it in SECTION
1.04.
"GOVERNMENTAL OR REGULATORY AUTHORITY" means any court,
tribunal, arbitrator, authority, administrative or other agency, commission,
gaming authority, official or other
48
authority or instrumentality of the United States or any state, county, city or
other political subdivision.
"HAZARDOUS MATERIAL" means any chemical, or other material, or
substance regulated under any Environmental Law including, without limitation,
any which are defined as or included in the definition of "hazardous
substances," "hazardous wastes," "hazardous materials," "infectious waste,"
"extremely hazardous wastes," "restricted hazardous wastes," "toxic substances,"
or "toxic pollutants" or words of similar import under any Environmental Law.
"HSR ACT" means Section 7A of the Xxxxxxx Act (Title II of the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended) and the rules
and regulations promulgated thereunder.
"IMPROVEMENTS" has the meaning ascribed to it in SECTION
1.01(a).
"INDEBTEDNESS" of any Person means all obligations of such
Person (i) for borrowed money, (ii) evidenced by notes, bonds, debentures or
similar instruments, (iii) for the deferred purchase price of goods or services
(other than trade payables or accruals incurred in the ordinary course of
business), (iv) under capital leases and (v) in the nature of guarantees of the
obligations described in clauses (i) through (iv) above of any other Person.
"INDEMNIFIED PARTY" means any Person claiming indemnification
under any provision of ARTICLE XI.
"INDEMNIFYING PARTY" means any Person against whom a claim for
indemnification is being asserted under any provision of ARTICLE XI.
"INDEMNITY NOTICE" means written notification pursuant to
SECTION 11.02(b) of a claim for indemnity under ARTICLE XI by an Indemnified
Party, specifying the nature of and basis for such claim, together with the
amount or, if not then reasonably determinable, the estimated amount, determined
in good faith, of the Loss arising from such claim.
"INVENTORIED BAGGAGE" has the meaning ascribed to it in
SECTION 5.06.
"INVENTORIED VEHICLES" has the meaning ascribed to it in
SECTION 5.08.
"JULY AGREEMENT" has the meaning ascribed to it in the
forepart of this Agreement.
"KANSAS CITY STATION CORPORATION AGREEMENT" means that certain
agreement dated as of October 17, 2000 by and among Ameristar Casino Kansas
City, Inc, a Missouri corporation, Ameristar Casinos, Inc, a Nevada corporation,
Kansas City Station Corporation, a Missouri corporation and Station Casinos,
Inc., a Nevada corporation.
"KNOWLEDGE OF THE COMPANY" means the actual knowledge of the
directors and executive officers of Parent or the Company, Parent's President of
Midwest Operations, Parent's General Counsel for Midwest Operations or the
General Manager of the Business.
49
"KNOWLEDGE OF PURCHASER" means the actual knowledge of the
members, directors and officers of Purchaser and its Affiliates.
"LAWS" means all laws, statutes, rules, regulations,
ordinances and other pronouncements having the effect of law of the United
States or any state, county, city or other political subdivision or of any
Governmental or Regulatory Authority.
"LEASED REAL PROPERTY" has the meaning ascribed to it in
SECTION 1.01(a).
"LESSEE SECURITY DEPOSITS" has the meaning ascribed to it in
SECTION 1.01(a).
"LESSOR SECURITY DEPOSITS" has the meaning ascribed to it in
SECTION 1.02(a).
"LIABILITIES" means all Indebtedness, obligations and other
liabilities of a Person (whether absolute, accrued, contingent, fixed or
otherwise, or whether due or to become due).
"LICENSED SUPPLIER" means a licensed supplier of Gaming
Devices in the State of Missouri.
"LICENSES" means all licenses, permits, certificates of
authority, authorizations, approvals, registrations, franchises and similar
consents granted or issued by any Governmental or Regulatory Authority.
"LIENS" means any mortgage, pledge, assessment, security
interest, lease, lien, adverse claim, levy, charge or other encumbrance of any
kind, or any conditional sale Contract, title retention Contract or other
Contract to give any of the foregoing.
"LOSS" or "LOSSES" means any and all damages, fines,
penalties, deficiencies, losses and expenses (including without limitation
interest, court costs, reasonable fees of attorneys, accountants and other
experts or other reasonable expenses of litigation or other proceedings or of
any claim, default or assessment).
"XXXX" has the meaning ascribed to it in SECTION 4.06(a).
"MATERIAL ADVERSE EFFECT" means any event or circumstance that
has or will have, or could reasonably be expected to have, a material adverse
effect on the Business or Condition of the Company after the Closing Date, it
being understood that in no event shall any of the following shall be deemed by
itself or by themselves, either individually or in the aggregate, to constitute
a Material Adverse Effect: (a) a failure by the Company to meet internal
earnings, revenue or other projections or earnings, revenue or other predictions
of any analyst, (b) any event, circumstance or market condition occurring as a
general economic or financial conditions or other developments which are not
unique to the Company but also is applicable to the gaming industry generally,
or the Missouri gaming industry in particular, or (c) the appointment of a
receiver to operate the Business, the operation of the Business by such a
receiver and the results of operations of the Business during such period of
operation, the imposition of monetary penalties which shall constitute Retained
Liabilities, or any Permitted Interruption; it being further understood that any
cessation of operation of the Business other than a Permitted Interruption shall
conclusively be deemed to be a Material Adverse Effect.
50
"NET CURRENT ASSETS" means for any date of determination the
net current assets of such Person at such date of determination calculated as
set forth on Exhibit H attached hereto.
"NPL" means the National Priorities List under CERCLA.
"ORDER" means any writ, judgment, decree, injunction or
similar order of any Governmental or Regulatory Authority (in each such case
whether preliminary or final).
"OWNED REAL PROPERTY" has the meaning ascribed to it in
SECTION 1.01(a).
"PARENT" has the meaning ascribed to it in the forepart of
this Agreement.
"PERMITTED INTERRUPTION" shall mean a cessation of the
operation of the Business for a period not to exceed fifteen days, provided that
during such period of interruption the Company shall continue to pay its
employees pursuant to its compensation policies in effect immediately prior to
the cessation of operations and for each day of such interruption shall
compensate employees that receive compensation in the form of tips an additional
amount equal to the average daily tip compensation received by such employees.
"PERMITTED LIEN" means (i) any Lien for Taxes not yet due or
delinquent or being contested in good faith by appropriate proceedings for which
adequate reserves have been established in accordance with GAAP, (ii) any
statutory Lien arising in the ordinary course of business by operation of Law
with respect to a Liability that is not yet due or delinquent and (iii) any
minor imperfection of title, easements of public record or similar Liens which
individually or in the aggregate with other such Liens would not have a Material
Adverse Effect.
"PERSON" means any natural person, corporation, limited
liability company, general partnership, limited partnership, proprietorship,
other business organization, trust, union, association or Governmental or
Regulatory Authority.
"PERSONAL PROPERTY LEASES" has the meaning ascribed to it in
SECTION 1.01(a).
"PLAN" means any bonus, incentive compensation, deferred
compensation, pension, profit sharing, retirement, stock purchase, stock option,
stock ownership, stock appreciation rights, phantom stock, leave of absence,
layoff, vacation, day or dependent care, legal services, cafeteria, life,
health, accident, disability, workers' compensation or other insurance,
severance, separation or other employee benefit plan, practice, policy or
arrangement of any kind, whether written or oral, including, without limitation,
any "employee benefit plan" within the meaning of Section 3(3) of ERISA.
"PREPAID EXPENSES" has the meaning ascribed to it in SECTION
1.01(a).
"PURCHASE PRICE" has the meaning ascribed to it in SECTION
1.03(a).
"PURCHASER" has the meaning ascribed to it in the forepart of
this Agreement.
"PURCHASER INDEMNIFIED PARTIES" means Purchaser and its
officers, directors, employees, agents and Affiliates.
51
"REAL PROPERTY" has the meaning ascribed to it in SECTION
1.01(a).
"REAL PROPERTY LEASES" has the meaning ascribed to it in
SECTION 1.01(a).
"RELEASE" means any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dispersal, leaching or
migration into the indoor or outdoor environment.
"REPRESENTATIVES" has the meaning ascribed to it in SECTION
4.03.
"REQUIRED CONSENTS" has the meaning ascribed to it in SECTION
1.08.
"RESOLUTION PERIOD" means the period ending ninety (90) days
following receipt by an Indemnified Party of a written notice from an
Indemnifying Party stating that it disputes all or any portion of a claim set
forth in a Claim Notice or an Indemnity Notice.
"RETAINED LIABILITIES" has the meaning ascribed to it in
SECTION 1.02(b).
"SURPLUS" means the amount, if any, by which Net Current
Assets as determined in accordance with SECTION 1.05 is a positive number.
"TANGIBLE PERSONAL PROPERTY" has the meaning ascribed to it in
SECTION 1.01(a).
"TAX RETURN" means any return, declaration, report, claim for
refund, or information return or statement relating to Taxes, including any
schedule or attachment thereto, and including any amendment thereof.
"TAXES" means (i) any federal, state, local or foreign income,
gross receipts, license, payroll, employment, excise, severance, stamp,
occupation, premium, windfall profits, environmental (including taxes under Code
ss.59A), customs duties, capital stock, franchise, profits, withholding, social
security (or similar), unemployment, disability, real property, personal
property, sales, use, transfer, registration, value added, alternative or add-on
minimum, estimated, or other tax of any kind whatsoever, including any interest,
penalty, or addition thereto, whether disputed or not and any expenses incurred
in connection with the determination, settlement or litigation of any Tax
liability and (ii) any liability for payment of amounts described in clause (i)
above as a result of any express or implied agreement to pay or indemnify
another Person with respect to such amounts or any liability for such amounts,
any joint and/or several liability for such amounts, and any such amounts for
which a Person is liable by operation of Law (including but not limited to
successor liability).
"THIRD PARTY CLAIM" has the meaning ascribed to it in SECTION
11.02(a).
"TRANSFER TAXES" has the meaning ascribed to it in SECTION
8.01.
"TRANSFER TIME" has the meaning ascribed to it in SECTION
1.04.
"TRANSFERRED EMPLOYEES" has the meaning ascribed to it in
SECTION 9.01(a).
52
"TRANSFERRED INTELLECTUAL PROPERTY" has the meaning ascribed
to it in SECTION 1.01(a).
"VACATION POLICY" has the meaning ascribed to it in SECTION
9.03.
"VEHICLES AND VESSELS" has the meaning ascribed to it in
SECTION 1.01(a).
"WARN" means the Worker Adjustment Retraining and Notification
Act of 1988.
13.02 CONSTRUCTION OF CERTAIN TERMS AND PHRASES. Unless the
context of this Agreement otherwise requires, (i) words of any gender include
each other gender; (ii) words using the singular or plural number also include
the plural or singular number, respectively; (iii) the terms "hereof," "herein,"
"hereby" and derivative or similar words refer to this entire Agreement; (iv)
the terms "Article" or "Section" refer to the specified Article or Section of
this Agreement; and (v) the phrase "ordinary course of business" refers to the
business of the Company. Whenever this Agreement refers to a number of days,
such number shall refer to calendar days unless Business Days are specified. All
accounting terms used herein and not expressly defined herein shall have the
meanings given to them under GAAP. Any representation or warranty contained
herein as to the enforceability of a Contract shall be subject to the effect of
any bankruptcy, insolvency, reorganization, moratorium or other similar law
affecting the enforcement of creditors' rights generally and to general
equitable principles (regardless of whether such enforceability is considered in
a proceeding in equity or at Law).
ARTICLE XIV
MISCELLANEOUS
14.01 NOTICES. All notices, requests and other communications
hereunder must be in writing and will be deemed to have been duly given only if
delivered personally, by facsimile transmission, by registered or certified mail
(postage prepaid, return receipt requested) or by overnight express courier to
the parties at the following addresses or facsimile numbers:
If to Purchaser, to:
Ameristar Casino St. Xxxxxxx, Inc.
0000 Xxxxxx Xxxxxx Xxxxxxx
Xxxxx 000 Xxxxx
Xxx Xxxxx, Xxxxxx 00000
Attention: Xxxxx X. Xxxxxxx, President & CEO
Facsimile No. (000) 000-0000
53
with copies to:
Xxxxxx X. Xxxxxxxx, Esq.
Senior Vice President of Legal Affairs
Ameristar Casinos, Inc.
00000 Xxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxxxxx, XX 00000-0000
Facsimile No. (000) 000-0000
and
Xxxxxx, Xxxx & Xxxxxxxx LLP
000 Xxxxx Xxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxxx X. Xxxxx, Esq.
Facsimile No. (000) 000-0000
If to the Company, to:
St. Xxxxxxx Riverfront Station, Inc.
c/o Station Casinos, Inc.
0000 Xxxx Xxxxxx Xxx.
Xxx Xxxxx, Xxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxx X Xxxxxxx, Esq.
with copies to:
Milbank, Tweed, Xxxxxx & XxXxxx LLP
000 Xxxxx Xxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Facsimile No.: (000) 000-0000
Attn: Xxxxxxx X. Xxxxxxxx, Esq.
All such notices, requests and other communications will (a)
if delivered personally to the address as provided in this SECTION 14.01, be
deemed given upon delivery, (b) if delivered by facsimile transmission to the
facsimile number as provided in this SECTION 14.01, be deemed given upon
receipt, and (c) if delivered by mail in the manner described above to the
address as provided in this SECTION 14.01, be deemed given upon receipt (in each
case regardless of whether such notice, request or other communication is
received by any other Person to whom a copy of such notice, request or other
communication is to be delivered pursuant to this SECTION 14.01). Any party from
time to time may change its address, facsimile number or other information for
the purpose of notices to that party by giving notice specifying such change to
the other party hereto.
54
14.02 ENTIRE AGREEMENT. This Agreement supersedes all prior
discussions and agreements between the parties with respect to the subject
matter hereof and contains the sole and entire agreement between the parties
hereto with respect to the subject matter hereof.
14.03 EXPENSES. Whether or not the transactions contemplated
hereby are consummated, Purchaser and the Company each shall pay the costs and
expenses incurred by such party in connection with the negotiation, execution
and closing of this Agreement and the transactions contemplated hereby.
14.04 PUBLIC ANNOUNCEMENTS. At all times at or before the
Closing, the Company and Parent, on the one hand, and Purchaser and ACI, on the
other, will not issue or make any reports, statements or releases to the public
or generally to the employees, customers, suppliers or other Persons to whom the
Company sells goods or provides services or with whom the Company otherwise has
significant business relationships with respect to this Agreement or the
transactions contemplated hereby without the consent of the other, which consent
shall not be unreasonably withheld. If either party is unable to obtain the
approval of its public report, statement or release from the other party and
such report, statement or release is, in the opinion of legal counsel to such
party, required by Law in order to discharge such party's disclosure
obligations, then such party may make or issue the legally required report,
statement or release and promptly furnish the other party with a copy thereof.
Purchaser and ACI will obtain the Company's prior approval of any press release
to be issued immediately following execution of this Agreement or the Closing
announcing execution of this Agreement or the consummation of the transactions
contemplated by this Agreement, which approval shall not be unreasonably
withheld. The Company and Parent will obtain Purchaser's prior approval of any
press release to be issued immediately following execution of this Agreement or
the Closing announcing this Agreement or the consummation of the transactions
contemplated by this Agreement.
14.05 WAIVER. Any term or condition of this Agreement may be
waived at any time by the party that is entitled to the benefit thereof, but no
such waiver shall be effective unless set forth in a written instrument duly
executed by or on behalf of the party waiving such term or condition. No waiver
by any party of any term or condition of this Agreement, in any one or more
instances, shall be deemed to be or construed as a waiver of the same or any
other term or condition of this Agreement on any future occasion. All remedies,
either under this Agreement or by Law or otherwise afforded, will be cumulative
and not alternative.
14.06 AMENDMENT. Except for amendments, supplements and
modifications to the Disclosure Schedule by the Company prior to the Closing
(which shall be made in accordance with the terms and provisions set forth in
the definition of the term "Disclosure Schedule"), this Agreement may be
amended, supplemented or modified only by a written instrument duly executed by
or on behalf of Purchaser, on the one hand, and the Company, on the other hand.
14.07 CONFIDENTIALITY. Each party hereto will hold, and will
use its best efforts to cause its Affiliates , and in the case of Purchaser, any
Person who has provided, or who is considering providing, financing to Purchaser
to finance all or any portion of the Purchase Price, and their respective
Representatives to hold, in strict confidence from any Person (other than any
such Affiliate, Person who has provided, or who is considering providing,
financing or
55
Representative), unless (i) compelled to disclose by judicial or administrative
process (including, without limitation, in connection with obtaining the
necessary approvals of this Agreement and the transactions contemplated hereby
of Governmental or Regulatory Authorities) or by other requirements of Law or
(ii) disclosed in an Action or Proceeding brought by a party hereto in pursuit
of its rights or in the exercise of its remedies hereunder, all documents and
information concerning the other party or any of its Affiliates furnished to it
by the other party or such other party's Representatives in connection with this
Agreement or the transactions contemplated hereby, except to the extent that
such documents or information can be shown to have been (a) previously known by
the party receiving such documents or information, (b) in the public domain
(either prior to or after the furnishing of such documents or information
hereunder) through no fault of such receiving party or (c) later acquired by the
receiving party from another source if the receiving party is not aware that
such source is under an obligation to another party hereto to keep such
documents and information confidential; provided that following the Closing the
foregoing restrictions will not apply to Purchaser's use of documents and
information concerning the Business, the Assets or the Assumed Liabilities
furnished by Seller hereunder. In the event the transactions contemplated hereby
are not consummated, upon the request of the other party, each party hereto
will, and will cause its Affiliates, any Person who has provided, or who is
considering providing, financing to such party and their respective
Representatives to, promptly (and in no event later than five (5) Business Days
after such request) redeliver or cause to be redelivered all copies of documents
and information furnished by the other party in connection with this Agreement
or the transactions contemplated hereby and destroy or cause to be destroyed all
notes, memoranda, summaries, analyses, compilations and other writings related
thereto or based thereon prepared by the party furnished such documents and
information or its Representatives.
14.08 NO THIRD PARTY BENEFICIARY. The terms and provisions of
this Agreement are intended solely for the benefit of each party hereto and
their respective successors or permitted assigns, and it is not the intention of
the parties to confer third-party beneficiary rights upon any other Person other
than any Person entitled to indemnity pursuant to ARTICLE XI hereof.
14.09 NO ASSIGNMENT; BINDING EFFECT. Neither this Agreement
nor any right, interest or obligation hereunder may be assigned by any party
hereto without the prior written consent of the other party hereto and any
attempt to do so will be void, except (a) for assignments and transfers by
operation of Law and (b) that Purchaser may assign any or all of its rights,
interests and obligations hereunder (including, without limitation, its rights
under ARTICLE XI) to (i) a wholly-owned subsidiary, provided that any such
subsidiary agrees in writing to be bound by all of the terms, conditions and
provisions contained herein and Purchaser remains liable for its obligations
under this Agreement, (ii) any post-Closing purchaser of the Business or a
substantial part of the Assets or (iii) any financial institution or other
entity providing purchase money or other financing to Purchaser from time to
time as collateral security for such financing. Subject to the preceding
sentence, this Agreement is binding upon, inures to the benefit of and is
enforceable by the parties hereto and their respective successors and assigns.
14.10 HEADINGS. The headings used in this Agreement have been
inserted for convenience of reference only and do not define or limit the
provisions hereof.
56
14.11 INVALID PROVISIONS. If any provision of this Agreement
is held to be illegal, invalid or unenforceable under any present or future Law,
and if the rights or obligations of any party hereto under this Agreement will
not be materially and adversely affected thereby, (a) such provision will be
fully severable, (b) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part hereof,
and (c) the remaining provisions of this Agreement will remain in full force and
effect and will not be affected by the illegal, invalid or unenforceable
provision or by its severance herefrom.
14.12 CONSENT TO JURISDICTION AND VENUE. Each party hereby
irrevocably submits to the exclusive jurisdiction of the United States District
Court for the District of Nevada or any court of the State of Nevada located in
Xxxxx County in any action, suit or proceeding arising out of or relating to
this Agreement or any of the transactions contemplated hereby, and agrees that
any such action, suit or proceeding shall be brought only in such court;
PROVIDED, HOWEVER, that such consent to jurisdiction is solely for the purpose
referred to in this SECTION 14.12 and shall not be deemed to be a general
submission to the jurisdiction of said courts or in the State of Nevada other
than for such purpose. Each party hereby irrevocably waives, to the fullest
extent permitted by Law, any objection that it may now or hereafter have to the
laying of the venue of any such action, suit or proceeding brought in such a
court. Each party further irrevocably waives and agrees not to plead or claim
that any such action, suit or proceeding brought in such a court has been
brought in an inconvenient forum.
14.13 GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the Laws of the State of Nevada applicable to a
Contract executed and performed in such State, without giving effect to the
conflicts of laws principles thereof.
14.14 ATTORNEY'S FEES. In the event of a dispute between the
parties hereto relating to this Agreement, the prevailing party to such dispute
will be entitled to recover its reasonable attorneys fees and other costs and
expenses relating to such dispute from the non-prevailing party.
14.15 TIME OF THE ESSENCE. Time is of the essence in
performing covenants and agreements hereunder.
14.16 COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which will be deemed an original, but all of
which together will constitute one and the same instrument.
ARTICLE XV
GUARANTEES
15.01 GUARANTEE OF THE COMPANY'S OBLIGATIONS. Parent hereby,
to the fullest extent permitted by applicable law, irrevocably and
unconditionally guarantees (the "PARENT GUARANTEE") to Purchaser and its
successors and assigns the prompt performance and payment in full when due of
all obligations of the Company to Purchaser under this Agreement and hereby
agrees to take all reasonably necessary action as the sole shareholder of the
Company to cause the Company to perform its obligations hereunder.
57
15.02 GUARANTEE OF PURCHASER'S OBLIGATIONS. ACI hereby, to the
fullest extent permitted by applicable law, irrevocably and unconditionally
guarantees (the "ACI GUARANTEE") to the Company and its successors and assigns
the prompt performance and payment in full when due of all obligations of
Purchaser to the Company under this Agreement and hereby agrees to take all
reasonably necessary action as the sole shareholder of Purchaser to cause
Purchaser to perform its obligations under this Agreement.
58
THIS AGREEMENT CONTAINS A BINDING ARBITRATION PROVISION WHICH
MAY BE ENFORCED BY THE PARTIES
IN WITNESS WHEREOF, this Agreement has been duly executed and
delivered by the duly authorized officer or trustee, as applicable, of each
party hereto as of the date first above written.
"PURCHASER"
AMERISTAR CASINO ST. XXXXXXX, INC.,
a Missouri corporation
By: /s/ Xxxxxx X. Xxxxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: Vice President
"THE COMPANY"
ST. XXXXXXX RIVERFRONT STATION, INC.,
a Missouri corporation
By: /s/ Xxxxx X. Xxxxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title:
"PARENT"
STATION CASINOS, INC.,
a Nevada corporation
By: /s/ Xxxxx X. Xxxxxxxxxxx
-----------------------------------------
Name: Xxxxx X. Xxxxxxxxxxx
Title:
59
"ACI"
AMERISTAR CASINOS, INC.,
a Nevada corporation
By: /s/ Xxxxxx X. Xxxxxxxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxxxxxxx
Title: Senior Vice President
and Chief Financial Officer
60