PURCHASE AND SALE AGREEMENT BETWEEN MARLYS A. KOEHLER-BERRY AS TRUSTEE OF THE KOEHLER FAMILY TRUST UNDER INSTRUMENT DATED SEPTEMBER 17, 1986 AND AMENDED SEPTEMBER 18, AND LOG CABIN, INC., A NEVADA CORPORATION (“LOG CABIN”) AS SELLER AND AWI GAMING,...
BETWEEN
XXXXXX
X.
XXXXXXX-XXXXX AS TRUSTEE OF THE XXXXXXX FAMILY TRUST
UNDER
INSTRUMENT DATED SEPTEMBER 17, 1986 AND AMENDED SEPTEMBER 18,
1991
(“XXXXXXX-XXXXX”)
AND
LOG
CABIN, INC., A NEVADA CORPORATION (“LOG CABIN”)
AS
SELLER
AND
AWI
GAMING, INC.
AS
BUYER
WESTERN
TITLE COMPANY, INC
(Title
Company)
Escrow
No. 150476-TME
FOR
XXXXXXXX’X
INN & CASINO, 0000 XXXXXXX XXXXXX, XXXXXXXX, XXXXXX 00000
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WESTERN
TITLE COMPANY
ESCROW
NO. 150476-TME
TABLE
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THIS
PURCHASE AND SALE AGREEMENT (this “Agreement”) is dated as of June ___, 2005,
and is entered into among AWI Gaming, Inc., a Nevada corporation (“Buyer”), and
Xxxxxx X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”), Log
Cabin, Inc., a Nevada corporation (“Log Cabin”), (Xxxxxxx-Xxxxx and Log Cabin
hereinafter “Seller”).
PRELIMINARY
STATEMENTS
| X. |
Xxxxxxx-Xxxxx
is the owner of Sturgeons Casino (the “Casino”), currently being run as a
sole proprietorship and is also the owner of one hundred percent
of the
issued and outstanding stock of Log Cabin, which owns and operates
the
restaurant and motel attached to the Casino (the Casino and Log Cabin’s
restaurant and motel are collectively referred to herein as the
“Business”). The Business is located at 0000
Xxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxx
00000.
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Seller
desires to sell certain of the assets utilized in the Business and
Buyer
desires to purchase such assets, in each case pursuant to the terms
and
conditions of this Agreement.
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AGREEMENT
The
Buyer
and Seller agree as follows:
1. Definitions.
For the
purposes of this Agreement, the following terms shall have the following
meanings:
1.1. “Accounts
Receivable” means all accounts receivable of the Business, including receivables
from Room Revenues, Other Revenues, and Leases.
1.2. “American
Wagering, Inc.” or “AWI” means American Wagering, Inc., a Nevada corporation,
and the parent company of AWI Gaming, Inc.
1.3. “AWI
Gaming, Inc.” means AWI Gaming, Inc., a Nevada corporation.
1.4. “Appurtenances”
means all rights, privileges, and easements appurtenant to the Real
Property.
1.5. “Assignment
and Assumption of Agreement” means the Assignment and Assumption Agreement, to
be duly executed and delivered by Buyer and Seller in accordance with this
Agreement. The Assignment and Assumption Agreement shall be in the form set
forth on Exhibit “A.”
1.6. “Assignment
of Intellectual Property” means the Assignment of Intellectual Property, to be
executed and delivered by Seller in accordance with Section 3.2 of this
Agreement,
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assigning
to Buyer all of Seller’s right, titles, interest in and to the Intangible
Property. The Assignment of Intellectual Property shall be in the form of,
and
upon the terms contained in Exhibit “B.”
1.7. “Associated
Equipment” means all associated equipment as defined by Nevada Revised Statutes
§ 463/0136 as may be amended.
1.8. “Xxxx
of
Sale” means the Xxxx of Sale, to be duly executed and delivered by Seller in
accordance with this Agreement, conveying the Personal Property to Buyer. The
Xxxx of Sale shall be in the form set forth on Exhibit “C.”
1.9. “Board
Approval” means all requisite approvals of the Board of Directors of
AWI.
1.10. “Buyer
Indemnities” has the meaning ascribed to it in Article 11 of this
Agreement.
1.11. “Casino”
means the interest in the Business and the ownership of the Improvements
compromising that portion of the Real Property containing a casino and
bar/lounge.
1.12. “Casino
Property” means collectively the Gaming Devices, the Associated Equipment and
any and all property related to the ownership and operation of the Gaming
Devices and Associated Equipment located in the Casino.
1.13. “Closing”
means the consummation of the conveyances of the Property, and the other
transactions contemplated under this Agreement, all of which shall occur on
or
before the Closing Date.
1.14. “Closing
Certificates” means: (a) a certificate of Seller stating that the warranties and
representations of Seller contained in this Agreement are true and correct
as of
the Closing Date, except as set forth in such certificate; and (b) a certificate
of Buyer stating that the warranties and representations of Buyer contained
in
this Agreement are true and correct as of the Closing date, except as set forth
in such certificate.
1.15. “Closing
Date” means the date upon which the Closing occurs which shall be no later than
the last day of the month following Gaming Approval by the Nevada Gaming
Commission unless an earlier date is mutually agreed upon by the parties
hereto.
1.16. “Code”
means the United States Internal Revenue Code of 1986, as amended.
1.17. “Compliance
Committee” means the Compliance Committee of AWI.
1.18. “Compliance
Committee Approval” means all requisite approvals of the Compliance Committee
which shall be obtained no later than thirty (30) days after execution of this
Agreement.
1.19. “Deposit”
means the sum of One Hundred Thousand Dollars ($100,000) in immediately
available funds. One half of the Deposit, Fifty Thousand Dollars ($50,000),
was
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delivered
to Escrow Holder on or about April 28, 2005. The remaining half of the Deposit
shall be delivered to Escrow Holder within two business days after the execution
and delivery of this Agreement by Seller for the benefit of Seller unless
Deposit is returned to Buyer pursuant to Section 2.1of this Agreement or applied
against of the Purchase Price at Closing.
1.20. “Environmental
Law” means any present federal, state and local laws, statutes, ordinances,
rules, regulations, orders, injunctions and decrees of any Governmental
Authority, or common law relating to Hazardous Materials and/or the protection
of human health or the environment by reason of a release or a threatened
release of Hazardous Materials or relating to liability for or costs of
remediation or prevention of releases. “Environmental Law” includes, but is not
limited to, the following statutes, as amended, any successor thereto, and
any
regulations, rulings, orders or decrees promulgated pursuant thereto, and any
state or local statutes, ordinances, rules, regulations, rulings, orders
injunctions and decrees of any Governmental Authority: the Comprehensive
Environmental Response, Compensation and Liability Act, 42 U.S.C. §§ 9601 et.
seq.; the Emergency Planning and Community Xxxxx-xx-Xxxx Xxx, 00 X.X.X. § 00000
et. seq.; the Hazardous Materials Transportation Act,
49 U.S.C. § 5101 et. seq.; the Resource Conservation and Recovery
Act (including but not limited to Subtitle I relating to underground storage
tank systems), 42 U.S.C. §§ 6901 et seq.; the Clean Water Act, 33 U.S.C. §§ 1251
et. seq.; the Clear Air Act, 42 U.S.C. §§ 7401 et seq.; the Toxic Substances
Control Act, 15 U.S.C. § 2601 et. seq.; the Safe Drinking Water Act, 42 U.S.C.
§§ 7401 et. seq.; the Occupational Safety and Health Act, 29 U.S.C. § 651 et.
seq.; the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C. § 136 et.
seq.; the Endangered Species Act, 16 U.S.C. §§ 1531 et seq. and the National
Environmental Policy Act, 42 U.S.C. § 4321 et seq. “Environmental
Law” also includes, but is not limited to, any present federal, state and local
laws, statutes, ordinances, regulations, orders, injunctions and decrees of
any
Governmental Authority and common law conditioning transfer of property upon
a
negative declaration or other approval of any Governmental Authority of the
environmental condition of the property; requiring notification or disclosure
of
releases or other environmental condition of the Real Property to any
Governmental Authority or other person or entity, whether or not in connection
with transfer of title to or interest in property; imposing conditions or
requirements relating to Hazardous Materials in connection with permits or
other
authorizations required by any Governmental Authority; relating to the handling
and disposal of Hazardous Materials; relating to nuisance, trespass or other
causes of action related to Hazardous Materials; and relating to wrongful death,
personal injury, or property or other damage in connection with the physical
condition or use of the Real Property by reason of the presence of the Hazardous
Materials in, on, under or above the Real Property.
1.21. “Equipment
Leases” means the leases of equipment used in the operation of the Property,
which are set forth on Exhibit “D,” and all of which shall be current as of the
Closing.
1.22. “ERISA”
means the Employment Retirement Income Security Act of 1974, as amended from
time to time, and the regulations promulgated thereunder.
1.23. “Escrow”
means the escrow established with Escrow Holder for the consummation of the
purchase and sale of the Property in accordance with this
Agreement.
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1.24. “Escrow
Holder” means Western Title Company, Inc. located at 000 Xxxxxxx Xxxxx Xxxxxxx,
Xxxxx 000, Xxxx, Xxxxxx 00000.
1.25. “Excluded
Property” means the Casino cash, cash equivalents, Inventory, all prepaid
utility deposits, any insurance claims, intercompany loans of which the Seller
is a creditor, the corporate charter of Seller, qualifications to conduct
business, arrangements with resident agents, taxpayer and other indemnification
numbers, seals, minute books, stock transfer books, stock certificates and
other
documents relating to the organization, maintenance, and existence of Seller
as
a corporation, the House Bank, House Funds, and Rebates or Refunds.
1.26. “Fixtures”
means all fixtures (other than the Casino Property) placed on, attached to,
or
located at and used in connection with the operation of, the Real Property
or
the Business.
1.27. “Gaming
Approval” means all requisite licenses, findings of suitability and other
required approvals of the Gaming Authority required to: (i) allow Buyer to
purchase and operate the Business, including the Property and the Casino, and
(ii) allow the Seller to transfer the Business, including the Property and
the
Casino.
1.28. “Gaming
Authority” means collectively the Nevada Gaming Control Board, the Nevada Gaming
Commission, the Pershing Liquor and Gaming Licensing Board and any other entity
having jurisdiction over the gaming and liquor operations located on the
Property.
1.29. “Gaming
Devices” means collectively the gaming devices as defined by Nevada Revised
Statutes § 463.0155 as may be amended.
1.30. “Gaming
Regulations” means the Nevada Gaming Control Act contained within Chapter 463 of
the Nevada Revised Statutes, as the same may be amended, and any regulations
promulgated thereunder.
1.31. “Governmental
Regulations” means, with the exception of the Gaming Regulations, any local,
state, and federal laws, ordinances, rules, requirements, resolutions, policy
statements and regulations (including, without limitation, those relating to
land use, subdivisions, zoning, environmental, labor relations, notification
of
sale to employees, Hazardous Materials, occupational health and safety, water,
earthquake hazard reduction and building fire codes) bearing on the
construction, development, alteration, rehabilitation, maintenance, use,
operation, or sale of the Property.
1.32. “Grant,
Bargain, Sale and Deed” means the Grant, Bargain, Sale, and Deed, to be duly
executed and delivered by Seller in accordance with this Agreement, conveying
the Real Property to Buyer. The Grant, Bargain, Sale and Deed shall be in the
form set forth on Exhibit “1.”
1.33. “Hazardous
Materials” means (i) any toxic substance or hazardous waste, substance, solid
waste or related material, or any pollutant or contaminant; (ii) radon gas,
asbestos in any form which is or could become friable, urea formaldehyde foam
insulation, transformers or other equipment containing dielectric fluid having
levels of polychlorinated biphenyls in excess of
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applicable
standards established by any Governmental Authority, any petroleum product
or
additive, any petroleum-based substances or any similar terms described or
defined in any Environmental Law applicable to regulating below or above ground
tanks and associated piping systems used in connection with the storage,
dispensing and general use of petroleum and petroleum-based substances, or
any
Toxic Mold; (iii) any substances, gas, material or chemical which is now or
hereafter defined as or included in the definition of “hazardous substances”,
“toxic substances”, “hazardous materials”, hazardous wastes”“regulated
substances”, or words of similar import under any Environmental Law; and (iv)
any other chemical, material, gas or substance the exposure to or release of
which is prohibited, limited or regulated by any Governmental Authority that
asserts or may assert jurisdiction over the Real Property or the operations
or
activity at the Real Property, or any chemical, material, gas or substance
that
does or is reasonably likely to pose a hazard to the health and/or safety of
the
occupants of the Real Property or the owners and/or occupants of property
adjacent to or surrounding the Real Property.
1.34. “House
Bank” means cash on hand including, without limitation, all chips and tokens at
the Casino as of the Transfer Time, including cash or cash equivalents in slot
hoppers, drop boxes, the cashier’s cage, and the hard and soft count
rooms.
1.35. “House
Funds” means cash on hand at the Business as of the Transfer Time.
1.36. “Improvements”
means the Casino, Restaurant, Motel, and all other improvements situated on
the
Real Property.
1.37. “Intellectual
Property” means the intellectual property owned by Seller or licensed to Seller
and used in connection with the Business or its operation including, but not
limited to, trade names, logos, derivations, slogans, and other marks, telephone
numbers, and TWX numbers owned or used by or licensed to Seller and the
associated Business.
1.38. “Inventory”
means all food, smallwares, paper and other restaurant supplies, wine, beer,
other alcoholic and non-alcoholic beverages, bath towels, bed linens, sundries
and other motel supplies, etc., on hand at the Real Property as of the Transfer
Time.
1.39. “Licenses
and Permits” means, with the exception of any gaming or liquor licenses or
approvals and subject to transferability, all of Seller’s rights, title,
interest, privileges, benefits and remedies in, to and under all authorizations,
approvals, permits licenses, agreements, variances, tentative maps, final maps,
plans and specifications, and land use entitlements held by Seller and/or
relating to the construction, reconstruction, occupancy, and operation or use
of
any part of the Real Property or Personal Property (e.g., all building permits,
certificates or occupancy, and business licenses), in each case set forth in
Exhibit “F.”
1.40. “Litigation
Expenses” means any court filing fee, court cost, arbitration fee or cost,
witness fee, and each other fee and cost of investigating and defending or
asserting any claim for indemnification under this Agreement, including, without
limitation, in each case, attorney’s fees, and other professionals’ fees, and
disbursements.
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1.41. “Motor
Vehicle Certificates of Ownership” means the Certificates of Ownership issued by
the Department of Motor Vehicles for the State of Nevada, to be duly executed,
properly endorsed and delivered by Seller in accordance with the terms of this
Agreement, conveying legal title of the Motor Vehicles to Buyer in accordance
with the rules and regulations for the Department of Motor Vehicles for the
State of Nevada, in each case set forth in Exhibit “G.”
1.42. “Notices
to Vendors” means notices from Seller to all vendors under Service Contracts
being assigned by Seller to, and assumed by, Buyer at the Closing or other
vendors providing goods or services to the Business at the Time of Closing
whereby such vendors are notified that the operation of the Business has been
transferred to Buyer.
1.43. “Other
Revenues” means all revenues earned from the operation of the Property, other
than gaming revenues and Room Revenues, including, without limitation, revenues
from the sale of food, the sale of alcoholic and non-alcoholic beverages, rental
meeting and banquet rooms, telephone sales, pay television sales, valet and
parking services, gift shop revenue, and other similar revenues, together with
any sales tax or other taxes thereon.
1.44. “Owner’s
Title Policy” means the standard form of ALTA Extended Coverage owner’s title
policy issued by the Title Company (together with such reinsurance carriers
as
Buyer may require) for property located in the State of Nevada to be issued
for
the benefit of Buyer, which Title Policy shall be: (a) without charges in excess
of regular premiums; and (b) shall show only Permitted Exceptions.
1.45. “Performing
Accounts Receivable” means any Account Receivable that is scheduled to become
due and payable to Seller within ninety (90) days old after the Transfer Time.
1.46. “Permitted
Exceptions” shall have the same meaning as defined in Article 6 of this
Agreement.
1.47. “Personal
Property” means all personal property of Seller located on or in or used in
connection with the Real Property (other than the Excluded Property) and the
Business, including, but not limited to, all Casino Property, equipment under
the Equipment Leases, printing and Stationary, advertising and promotional
literature, Motor Vehicles, all consumables, upholstery material, computer
equipment, reservation terminals, cash registers, office supplies, office
equipment (including, without limitation, facsimile machines, copiers and
telephones, external internet connections, or wired fidelity connections) office
furniture, motel room furniture and fixtures including: televisions, minibars,
carpets and rugs, all furniture, furnishings, motel equipment, beds, bureaus,
couches, chinaware, glassware, silverware, ornaments, kitchen utensils, bars,
bar fixtures, safes, stoves, ranges, refrigerators, radios, electrical
equipment, lamps, mirrors, heating and lighting fixtures and equipment, linens,
blankets, steam and hot water boilers, engines, generators, ice machines,
cooling systems, air conditioning machines, fire prevention and extinguishing
apparatus, pipes, radiators, bathtubs, plumbing fixtures, gas and electric
fixtures, and all similar and related articles located in the bedrooms, sitting
rooms,
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bathrooms,
boudoirs, halls, closets, kitchens, dining rooms, bar rooms, offices, lobbies,
basements and cellars, vaults and other portions of the Real
Property.
1.48. “Preliminary
Title Report” means the first amended preliminary report dated as of May 2,
2005, as Order No. 00018718-099 issued by the Escrow Holder.
1.49. “Property”
means the Real Property, the Personal Property, the Service Contracts, and
the
Intellectual Property of the Business.
1.50. “Purchase
Price” means the sum of U.S. One Million Eight Hundred Thousand Dollars
($1,800,000).
1.51. “Real
Property” means the Real Property, the Improvements, the Fixtures, and
Appurtenances, the legal description of which is set forth in Exhibit
“E”.
1.52. “Rebates
or Refunds” means all refunds, rebates, reimbursements or other similar payments
made to the Seller after the Closing Date in connection with or as a result
of:
(a) taxes previously paid by Seller with respect to the Property or any portion
thereof, except for income taxes paid by seller as a result of income earned
from the operation of the Property, (b) fees paid by Seller to any governmental
agency with jurisdiction over the Property or any portion thereof or with
respect to the development or operation of the Property or any portion thereof;
(c) any other amounts paid by or on behalf of the Seller to third parties in
connection with the ownership, maintenance, and/or operation of the Property,
including, but not limited to, any deposits paid by or on behalf of Seller
to
utility companies, governmental entities and any other third parties servicing
the Property; or (d) any other reason related to the Property. Such Rebates
or
Refunds shall remain Seller’s property after the Closing Date.
1.53. “Reservation
Agreements” means all guest, banquet room and meeting room and restaurant
reservation agreements executed by Seller and all deposits made thereunder
for
periods after the Closing.
1.54. “Room
Revenues” means all revenues from the rental of motel guest rooms (but excluding
any items included in the definition of Other Revenues), together with any
sales
or other taxes collected by the Seller.
1.55. “Seller’s
Payables” means the accounts payable with respect which seller agrees to be
fully responsible for the payment at the Closing Date.
1.56. “Service
Contracts” means the maintenance contracts, warranties, guarantees, management
contracts and bonds, and any other similar obligations, commitments or
arrangements, together with all supplements, amendments and modifications
thereto relating to the construction, development, marketing, operation,
maintenance or enjoyment of the Property (other than the Casino
Property).
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1.57. “Survey”
means an ALTA “as built” survey of the Real Property to be prepared at Seller
and Buyer’s shared expense (each to pay one half of the cost) by a licensed
surveyor or civil engineer who is selected by Buyer.
1.58. “Title
Company” means Western Title, which is interchangeable with Escrow Holder and/or
its agent in the State of Nevada.
1.59. “Transfer
Documents” means the Xxxx of Sale, the Assignment and Assumption Agreement, the
Assignment of Intellectual Property, and Motor Vehicle Certificates of
Ownership.
1.60. “Transfer
Time” means 12:01 a.m. PST on the Closing Date.
1.61. “Transferor’s
Certificate” means the certificate, to be duly executed by Seller under penalty
of perjury and delivered by Seller in accordance with this Agreement certifying
that Seller is not a “foreign person” in accordance with the provisions of
Section 1445 of the Code and any similar provisions of applicable state
law.
1.62. “WARN
Act” means the Worker Adjustment and Retraining Notification Act (29 U.S.C. 2102
et seq.).
1.63. “Warranties”
means all third party warranties and guarantees relating to the
Property.
1.64. Use
of Defined Terms.
Any
defined term used in the plural shall refer to all members of the relevant
class, and any defined term used in the singular shall refer to any one or
more
of the members of the relevant class.
1.65. Exhibits
and Schedules.
All
Exhibits and Schedules to this Agreement, either as originally existing or
as
the same may from time to time be supplemented, modified, or amended are
incorporated herein by this reference.
1.66. Miscellaneous
Terms.
The
term “or” is disjunctive; the term “and” is conjunctive; the term “shall” is
mandatory; the term “may” is permissive. Masculine terms shall also apply to
female; feminine terms shall also apply to male. The term “including” is by way
of example and not limitation.
2. Purchase
Price.
Seller
agrees to sell to Buyer, and Buyer agrees to purchase from Seller, the Property,
in accordance with the terms, and subject to the conditions, of this Agreement.
The Purchase Price for the Property will be paid as follows:
2.1. Deposit.
Upon Seller’s acceptance of the Letter of Intent, Buyer immediately deposited
with the Escrow Holder Fifty Thousand Dollars ($50,000), which may be refundable
until June 12, 2005. Within two (2) business days after the execution and
delivery of this Agreement, Buyer shall deliver to the Escrow Holder and
additional Fifty Thousand Dollars
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($50,000),
at which time the full Deposit of One Hundred Thousand Dollars ($100,000) shall
become nonrefundable.
2.2. Balance
of the Purchase Price.
On
the Closing Date, Buyer shall pay One Million Eight Hundred Thousand Dollars
($1,800,00.00) to Seller: the $100,000 nonrefundable Deposit plus an additional
One Million Seven Hundred Thousand Dollars ($1,700,000).
2.3. Allocation
of the Purchase Price.
The Purchase Price shall be allocated among the various components of the
Property pursuant to Schedule 2.3 of this Agreement.
3.1. Escrow
Instructions.
Within forty-eight (48) hours following the mutual execution and delivery of
this Agreement, the parties shall deposit a fully executed counterpart of this
Agreement with the Escrow Holder in order to consummate the purchase and sale
in
accordance with the terms of this Agreement. This Agreement shall constitute
joint escrow instructions to the Escrow Holder; except that the parties shall
execute such additional instructions as may be reasonably requested by the
Escrow Holder not inconsistent with the provisions of this Agreement. The
Closing will take place at 10: 00 a.m. (PST) on the Closing Date at the offices
of Western Title Company, Inc. located
at 000 Xxxxxxx Xxxxx Xxxxxxx, Xxxxx 000, Xxxx, Xxxxxx 00000.
3.2. By
Seller.
At the
Closing, Seller shall deliver, or cause to be delivered to Escrow Holder, the
following items (if applicable) duly executed, and where appropriate,
acknowledged by Seller:
3.2.1. A
counterpart original of the Assignment of Intellectual Property;
3.2.2. The
Xxxx
of Sale;
3.2.3. A
counterpart original of the Assignment and Assumption Agreement;
3.2.4. The
Motor
Vehicle Certificates of Ownership;
3.2.5. An
executed Preliminary Schedule of Adjustments;
3.2.6. The
Notices to Vendors;
3.2.7. The
Transferor’s Certificate;
3.2.8. The
Seller’s Closing Certificate; and
3.2.9. The
Grant, Bargain, Sale and Deed
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3.2.10. Such
resolutions, authorizations, certificates of good standing and/or other
corporate documents relating to Seller as are reasonably required by Buyer
in
connection with the transactions contemplated under this Agreement;
3.2.11. Keys
to
all doors on any structures and improvements situated on the Property, which
keys shall be properly tagged for identification; and
3.2.12. Possession
of the Personal Property.
3.3. By
Buyer.
At the
Closing, Buyer will deliver or cause to be delivered to Escrow Holder the
following items, duly executed and, where appropriate, acknowledged by
Buyer;
3.3.1. The
net
balance of the Purchase Price, to be paid in accordance with this Agreement,
and
after taking into account the Deposit and the adjustments and cost allocations
in accordance with this Agreement;
3.3.2. Such
corporate resolutions, certificates of good standing and/or other corporate
and
partnership documents relating to Buyer as are reasonably required by Seller
in
connection with the transactions contemplated under this Agreement;
3.3.3. Buyer’s
Closing Certificate;
3.3.4. A
counterpart original of the Assignment of the Intellectual
Property;
3.3.5. The
Xxxx
of Sale;
3.3.6. A
counterpart original of the Assignment and Assumption Agreement;
3.4. By
Buyer and Seller.
Buyer
and Seller will each deposit into Escrow such other duly executed and, where
appropriate, acknowledged instruments consistent with this Agreement as are
reasonably required to effectuate the transactions contemplated under this
Agreement.
3.5. Close
of Escrow.
When
(i) each party has deposited in Escrow all of the funds and documents required
to be deposited in Escrow by it pursuant to Articles 2 and 3 or any other
provision of this Agreement; (ii) each of the parties has approved or waived
each of the conditions in its favor set forth in this Agreement; and (iii)
Escrow Holder is otherwise in a position to close Escrow, Escrow Holder shall
close Escrow by:
3.5.1. Recording
in the Official Records of Pershing County, Nevada, the documents deposited
in
Escrow, which are in recordable form;
3.5.2. Subject
to Article 2, delivering to Seller the Purchase Price, as adjusted, for Seller’s
share of prorations and Closing costs;
3.5.3. Delivering
to Seller a counterpart original of the Assignment and Assumption Agreement,
a
counterpart original of the Assignment of Intellectual Property, the Motor
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Vehicle
Certificates of Ownership, the written certificates required under this
Agreement, and any other documents (or copies thereof) delivered into Escrow
by
Seller.
3.6. Deliveries
Outside of Escrow.
At
least two (2) business days before the Closing Date, Seller shall deliver to
Buyer drafts of the following, the finals of which shall be delivered at
Closing:
3.6.1. Revised
and updated schedules and exhibits as required pursuant to this Agreement,
prepared as of the Closing Date, certified to be true, correct, and complete
as
of the date of preparation;
3.6.2. At
Closing, Seller shall deliver to Buyer the following outside of
Escrow:
3.6.2.1. All
keys
and entrance cards to all doors on any structures and improvements situated
on
the Property, and keys to all Personal Property located on the Real Property,
which keys shall be properly tagged for identification, together with an
accounting for all such keys (other than keys in possession of motel guests)
in
the possession of others;
3.6.2.2. An
itemized list of Excluded Property set forth in Schedule 3.6.2.2; whereupon
Buyer and Seller shall negotiate a separate purchase price for the individual
items of Excluded Property. Although Buyer will not purchase or assume any
liability for Seller’s chip and token liability (a House Bank item and an item
of Excluded Property), Buyer will act as Seller’s place of redemption for the
chip and token liability. Buyer will redeem Seller’s chip and token liability
and submit an invoice to Seller for reimbursement.
3.6.2.3. All
current real estate and personal property tax bills for the Property in Seller’s
possession or under its control;
3.6.2.4. A
complete list of the Reservation Agreements in effect as of the Closing Date,
in
reasonable detail so as to enable Buyer to honor Seller’s commitments in that
regard;
3.6.2.5. A
list of
all safe deposit boxes in use as of the Closing Date, an inventory of the
contents of such safe deposit boxes prepared and signed by the Business guest
and an employee of Seller, and notices of the Business guests of the transfer
of
control of the same safe deposit boxes;
3.6.2.6. Baggage,
laundry, and other personal property of Business guests checked in or left
in
the care of the Seller by transient Business guests (other than property in
motel rooms or safe deposit boxes), together with a list thereof prepared and
signed by an employer of Seller; and
3.6.2.7. Possession
of the Property subject to any Permitted Encumbrances.
4. Representations
and
Warranties.
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4.1. Seller’s
Representations and Warranties.
Seller
makes the following representations and warranties to Buyer, upon which
warranties and representations Buyer has relied and will continue to rely,
all
of which are true as of the date of this Agreement and will be true and correct
as of the Closing:
4.1.1. Organization
of Trust. Xxxxxxx-Xxxxx
has the full power and authority to enter into and carry out this Agreement
and
the transactions contemplated by this Agreement. This Agreement and each of
the
other documents described in this Agreement have been duly authorized by
Xxxxxxx-Xxxxx, which executed and delivered to Buyer, will constitute legal,
valid, and binding obligations enforceable against Xxxxxxx-Xxxxx in accordance
with the terms of such documents subject to applicable laws relating to or
affecting the rights of creditors generally and subject to enforceability under
general equity principles.
4.1.2. Organization
of Log Cabin.
Log
Cabin is duly organized, validly existing and in good standing under the laws
of
the State of Nevada and is duly qualified to do business in the State of Nevada.
The execution and delivery of this Agreement and the other documents
contemplated by this Agreement by Seller, and the performance by Seller of
the
obligations under this Agreement and the other documents contemplated in this
Agreement: (i) are within the power of Seller; (ii) have been duly authorized
by
all requisite corporate action on the part of Seller; and (iii) will not violate
any provision of law, any order of any court or agency of government, the
charter documents of Seller, or any indenture, agreement, or any other
instrument to which Seller is a party. This Agreement and each of the other
documents described in this Agreement, which executed and delivered to Buyer,
will constitute legal, valid, and binding obligations enforceable against Seller
in accordance with the terms of such documents subject to applicable laws
relating to or affecting the rights of creditors generally and subject to
enforceability of general equity principles.
4.1.3. Non-foreign
Person.
Seller
is not a “foreign person” as that term is defined in Section 1445(f) of the Code
and in the applicable provisions of state statute, if any, and the regulations
issued thereunder, as amended, or any successor thereto, as set forth in
Schedule 4.1.3.
4.1.4. Personal
Property Owner.
Seller
is the sole owner of the Personal Property free of any adverse claim of any
kind
whatsoever, except as set forth in Schedule 4.1.4.
4.1.5. Seller
shall deliver all equipment used to operate the Property in good working
condition in accordance with Seller’s normal course of business at the Transfer
Time.
4.1.6. No
Prior Transfers - Property.
Except
as otherwise set forth in this Agreement, Seller has not transferred, by sale,
assignment or otherwise, to any person, partnership, corporation, limited
liability company, general partnership, limited partnership, proprietorship,
other business organization, truest, union, or association, all or any portion
of any right title, or interest which it may have in and to the
Property.
4.1.7. Agreements.
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4.1.7.1. There
are
no contracts for deed, land contracts, oral or written agreements, or other
executory agreements whatsoever outside of the ordinary course of business
for
the assignment or transfer of any portion(s) of the Property in effect or in
existence with respect to the Property, except those set forth on the
Preliminary Title Report.
4.1.7.2. Except
as
set forth on Schedule 4.1.7.2, there are no management, service, maintenance,
advertising, advance booking, employment or brokerage agreements, obligations,
commitments or arrangements, written or oral, with respect to the Property,
except for the Service Contracts and the Reservation Agreements.
4.1.7.3. Other
than the consents and approvals required pursuant to the Compliance Committee
Approval, no consents to transfer the Property or any part thereof are needed
on
the part of Seller.
4.1.8. No
Litigation.
Except
as disclosed in Schedule 4.1.8 attached to this Agreement, there (a) is no
actual or, to the best of Seller’s knowledge, threatened suit, action, legal,
administrative, arbitration, or other proceeding, or governmental investigation
involving or affecting the Property, and (b) are no judgments, decrees, or
orders against Seller.
4.1.9. Notice
of Violations.
Seller
has (a) not received written notice of any outstanding violations of any
Governmental Regulations, and (b) no knowledge of any condition which
constitutes, or may constitute, a material violation of any Governmental
Regulation.
4.1.10. Hazardous
Substances.
To the
best of Seller’s knowledge or in the Phase I and Phase II Environmental Reports,
(a) neither Seller nor any third parties have disposed of, generated, handled,
manufactured, stored, used, transported, or discharged any Hazardous Material
in
or about the Real Property, nor are there (b) any violations under or actions
taken with respect to violations under any Governmental Regulations, or (c)
any
underground storage tanks located on or under the Real Property.
4.1.11. Compliance
with Agreements.
The
execution and deliver of, and performance under, this Agreement has not and
will
not constitute a breach or default under any other agreement, law, or court
order to which Seller is a party or may be bound or affected or which may
materially adversely affect the Property, or the use, occupancy, or operation
of
the Property. Seller is not in default under any agreement or commitment to
which it is a party, the effect of which default could materially adversely
affect the performance by Seller of its obligations under this Agreement. No
default exists on the part of Seller under any covenant, restriction, or
agreement, which would materially adversely affect the Property, except as
disclosed on Schedule 4.1.11 attached to this Agreement.
4.1.12. Utilities.
All
utility services necessary for the occupancy and use of the Property, including
telephone services, cable television, gas, electric power, storm sewers,
sanitary sewer, and water facilities, are available to the Property, adequate
to
serve
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the
Property and not subject to any conditions, other than normal charges to the
utility supplier, which would limit the use of such utilities.
4.1.13. Labor
Issues; Compensation Plans.
4.1.13.1. There
are
no strikes, pickets, leafleting, walkouts, sit-ins, boycotts, or similar actions
pending or threatened against Seller by its employees or any labor
unions.
4.1.13.2. Seller
shall be responsible for accrued compensation and benefits, including, without
limitation, pension plan benefits, savings, and retirement plan benefits,
vacation pay, sick pay, and salaries of each employee of the Business up to
and
including the Closing Date, as required under applicable law. On the Closing
Date, Seller shall terminate all employees.
4.1.13.3. Tax
Returns.
Except
as otherwise provided on Schedule 4.1.13.3 attached to this Agreement, Seller
has filed or has otherwise received an extension to file with the appropriate
governmental agencies all required tax returns and tax reports with respect
to
the Property and the operation of the Business. All taxes with respect to the
Property due and payable for all periods before Closing shall be paid before
Closing or within a reasonable period thereafter.
4.1.13.4. Insolvency.
There
are no attachments, execution proceedings, assignments for the benefit of
creditors, insolvency, bankruptcy, reorganization, or other proceedings pending
or to Seller’s knowledge, threatened against Seller, nor are any such
proceedings contemplated by Seller.
4.1.13.5. Governmental
Actions.
To the
best of Seller’s knowledge, there are no plans, studies, or efforts by any
governmental authorities or agencies or by any other persons or entities that
in
any way could materially adversely affect the use of the Property or any portion
thereof.
4.1.13.6. Zoning.
To the
best of Seller’s knowledge, there are no other pending or threatened zoning
changes or variances which would materially adversely affect the Real
Property.
4.1.13.7. Moratoria.
To the
best of Seller’s knowledge, there is no intended or proposed federal, state, or
local statute, ordinance, order, requirement, law, or regulation (including,
but
not to, zoning changes or moratoria) or any plan, study or effort which may
materially adversely affect the use or development of the Property; except
that
the Property would not be eligible to receive a State of Nevada non-restricted
gaming license if non-restricted gaming operations were to cease at the Property
for a period of eighteen (18) months.
4.1.13.8. Property
Tax Assessments.
Except
for the Seller’s Payables and those matters set forth in the Owner’s Title
Policy for any special improvement
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district
applicable to the Property, to Seller’s knowledge there are no special
assessments or charges which have been levied against the Property or which
have
resulted or will result in the creation of a lien or otherwise against the
Property from work, activities or improvements done to the Property by Seller
or
any intended public improvement.
4.1.13.9. Condemnation
Proceedings.
Seller
has received no notice of any condemnation or eminent domain proceeding pending
or threatened against the Property or any part thereof.
4.1.13.10. Continuing
Representation.
No
representation, warranty, or statement of Seller in this Agreement or in any
document, certificate, schedule, or other matter furnished or to be furnished
to
Buyer pursuant thereto or in connection with the transaction contemplated in
this Agreement contains or will contain any untrue statement of a material
fact
or omits or will omit to state a material fact necessary to make the statements
or facts contained herein and therein not misleading.
4.1.13.11. Exhibits.
All
exhibits to this Agreement are true, correct, and complete as of the date of
this Agreement and shall be correct and complete as of the Closing
Date.
4.1.13.12. Brokers.
There
are no brokers’ commissions or finder’s fees payable in connection with the
transaction contemplated by this Agreement.
4.2. Buyer’s
Representations and Warranties.
Buyer
makes the following representations and warranties to Seller upon which
warranties and representations Seller has relied and will continue to rely,
all
of which are true and correct as of the date of this Agreement and will be
true
and correct as of the Closing:
4.2.1. Organization.
Buyer
is duly organized, validly existing, and in good standing under the laws of
the
State of Nevada. The execution and delivery of this Agreement and the other
documents contemplated pursuant to this Agreement by Buyer, and the performance
by Buyer of the obligations under this Agreement and the other documents
contemplated in this Agreement: (i) are within the power of Buyer; (ii) have
been duly authorized by all requisite action on the part of Buyer and all of
its
constituent members; and (iii) will not violate any provision of law, any order
of any court or agency of government, the charter documents of Buyer, or any
indenture, agreement, or any other instrument to which Buyer is a party. This
Agreement and each of the other documents described in this Agreement, when
executed and delivered to Buyer, will constitute legal, valid, and binding
obligations enforceable against Buyer in accordance with the terms of such
documents.
4.2.2. Compliance
with Agreements.
The
execution and delivery of, and performance under, this Agreement has not and
will not constitute a breach or default under any other agreement, law or court
order to which Buyer is a party.
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4.2.3. Insolvency.
There
are no attachments, execution proceedings, assignment for the benefit of
creditors, insolvency, bankruptcy, reorganization, or other proceedings pending
or threatened against Buyer nor are any such proceedings contemplated by
Buyer.
4.2.4. Brokers.
There
are no brokers’ commissions or finder’s fees payable in connection with the
transaction contemplated by this Agreement.
5. Obligations
of
the Parties.
5.1. Seller’s
Obligations.
Seller
hereby covenants to Buyer, upon which covenants Buyer has relied and will
continue to rely, that for the period from the date of this Agreement through
and including the Closing Date:
5.1.1. Accounts
Payable and Vendors.
There
will be no accounts payable of vendors providing, supplying goods or services
to, or involving or affecting the Property as of the Closing Date, except for
Seller’s Payables.
5.1.2. Further
Liens and Encumbrances.
Seller
will not subject the Property to any additional liens, encumbrances, covenants,
conditions, easements, rights of way or similar matters outside of the ordinary
course of business after the date of this Agreement. Seller will not hereafter
modify, extend, renew, replace, or otherwise change any of the terms, covenants,
or conditions of any such documents, or enter into any new agreements affecting
the Property without the prior written consent of Buyer, which consent shall
not
be unreasonably withheld.
5.1.3. Leases;
Other Contracts.
Seller
will not hereafter modify, extend, renew, replace, or otherwise change any
of
the Service Contracts, or existing contracts, or enter into new leases,
Reservation Agreements or other contracts affecting the property except: (a)
in
the ordinary course of business; or (b) with the prior written consent of Buyer
(which consent shall not be unreasonably withheld).
5.1.4. Seller’s
Execution, Delivery, and Performance.
Seller
and Buyer will execute all documents and take all steps deemed necessary or
desirable by the other party to give effect to the terms and conditions of
this
Agreement.
5.1.5. Prepayments.
Seller
shall continue to operate the Business in the normal course of business and
accept any deposits made with respect to reservations for guest rooms, meeting
rooms, restaurants, and banquet facilities for dates after the Closing Date,
and
the same shall be placed in the appropriate account or accounts maintained
by
Seller and used in the operation of the Business, which accounts shall be
transferred to Buyer on the Closing Date.
5.1.6. Debt
Service.
Seller
will make all regular payments of interest and principal on any and all
indebtedness affecting the Property.
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5.1.7. Compliance
with Laws.
Seller
shall comply with all Governmental Regulations.
5.1.8. Insurance.
Seller
shall: (a) provide Buyer with a list of each type and amount of insurance
coverage in effect with respect to the Property; and (b) maintain in full force
and effect all such policies of insurance through and including the Closing
Date.
5.2. Buyer’s
Obligations.
5.2.1. Applications
for Licenses and Permits.
Buyer
shall submit all required gaming applications within thirty (30) days after
the
execution of this Agreement. Buyer shall also promptly submit any and all
applications for assignment of any other applicable licenses and permits or
issuance of new licenses and permits.
5.2.2. Gaming
Licenses.
From
and after the Closing Date, Buyer shall not take any action or fail to act
when
required to do so (including, without limitation, the filing of any application
requested by the Gaming Authorities and the full and complete cooperation in
the
investigation of the same by the Gaming Authorities) in any way that may
threaten or jeopardize any gaming or liquor license held by Buyer or any
detrimental change of the gaming status of the Property.
5.2.3. Employees.
Buyer
shall hire substantially all of Seller’s employers on the Closing
Date.
5.2.4. Reservations.
Buyer
will honor, for its account, all Reservation Agreements provided to Buyer
pursuant to Section 3.6 of this Agreement for dates after the Closing
Date.
6. Title
to Real Property.
At
Closing, a fee simple title interest in and to the Real Property will be
conveyed to Buyer by Seller, subject only to items one (1) through nine (9)
and
fifteen (15) set forth on the Preliminary Title Report and the following items
(collectively, the “Permitted Exceptions”):
6.1. Matters
of title respecting the Real Property approved or deemed approved by Buyer
in
accordance with this Agreement; and
6.2. Matters
affecting the condition of title to the Real Property created by or with written
consent of Buyer.
6.3. If
there
is an encroachment reflected in the ALTA policy, Buyer shall not be obligated
to
accept the Property unless the parties mutually agree to work together to
rectify the situation to the Buyer’s approval.
7. Conditions
Precedent/Concurrent
to Closing; Closing
Date.
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7.1. Buyer’s
Conditions.
Buyer
shall not be required to close the transaction provided for under this Agreement
unless and until Buyer deems that each and every one of the following conditions
has been fulfilled, unless Buyer waives in writing the fulfillment of a
condition:
7.1.1. Representations,
Warranties, and Covenants of Seller.
Seller
shall have duly and timely performed each material covenant to be performed
by
Seller under this Agreement and the representations and warranties of Seller
set
forth in this Agreement shall be true and correct as of the Closing in all
material respects.
7.1.2. Seller’s
Deliveries.
Seller
shall have duly and timely delivered to Buyer all of the items described in
Section 3.2 of this Agreement.
7.1.3. Exhibits
and Schedules.
On the
Closing Date, Seller shall have updated each of the Exhibits and Schedules
attached hereto so that the same are true and complete in all material respects
as of the Closing Date.
7.2. Seller’s
Conditions.
Seller
shall not be required to close the transaction provided for under this Agreement
unless and until Seller deems that each of the following conditions has been
fulfilled, unless Seller waives in writing the fulfillment of a
condition:
7.2.1. Representations,
Warranties, and Covenants of Buyer.
Buyer
shall have duly and timely performed each and every covenant to be performed
by
Buyer under this Agreement and the representations and warranties of Buyer
set
forth in this Agreement shall be true and correct as of the Closing in all
material respects.
7.2.2. Buyer’s
Deliveries.
Buyer
shall have duly and timely delivered to Seller all of the items described in
Section 3.3 of this Agreement.
8. Prorations
and
Adjustments.
Buyer
is acquiring all of Seller’s right, title, and interest in and to the Property
as of the Transfer Time and, accordingly, there shall be no prorations between
the parties, except as expressly provided herein.
8.1. Room
Revenues; Other Revenues.
Buyer
shall be entitled to all Room Revenues and Other Revenues arising on the date
immediately subsequent to Closing Date.
8.2. Utilities.
Prior
to the Closing Date, Seller shall notify all utility companies servicing the
Property of the anticipated change in ownership of the Property and request
that
all xxxxxxxx after the Transfer Time be made to Buyer at the Business address.
Utility meters will be read, to the extent that the utility company will do
so,
during the daylight hours on the Closing Date, with the charges to that time
paid by Seller and charges thereafter paid by Buyer. Charges for utilities
which
are unmetered, or charges for the meters which have not been read on the Closing
Date, will be prorated between Buyer and Seller as of the Transfer Time based
upon utility xxxxxxxx for any such charges to the other party, and such party
shall pay its pro rata share of such charges to the party requesting payment
within seven (7) days from the date of any such request. All utility deposits
made by Seller shall be assigned to Buyer and the amount of such deposits shall
be credited to Seller at the Closing.
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8.3. Accounts
Payable and Expenses.
All
accounts payable and expenses related to operation of the Property which have
accrued before the Transfer Time shall be paid by Seller and Seller shall
defend, indemnify, and hold Buyer harmless from and against any claims, demands,
liabilities, liens, costs, expenses, penalties, damages, and losses (including,
but not limited to, attorneys’ fees and costs) suffered by Buyer as a direct or
an indirect result of the non-payment of such accrued accounts payable and
accrued expenses. All accounts payable and expenses (including all assigned
and
assumed agreements hereunder) arising after the Transfer Time which are included
by or at the direction of Buyer will be Buyer’s responsibility. In addition,
Seller shall pay the Seller’s Payables as soon as practicable after Closing. The
indemnity provided in this Section shall survive the Closing Date for a period
of one (1) year.
8.4. Taxes.
Seller
shall pay general real estate and ad valorem personal property taxes for all
periods before the Transfer Time and all special taxes or assessments becoming,
with respect to the Property, due and payable before the Transfer Time and
any
such taxes for the period in which the Closing Date falls shall be appropriately
porarated as of the Closing Date.
8.5. Accounts
Receivable.
Buyer
shall not acquire the Accounts Receivable from Seller and there shall be no
adjustments or prorations for Accounts Receivable that are owed to Seller before
the Closing Date. In addition, Seller shall provide Buyer with a list of
Performing Accounts Receivable that Seller would otherwise receive after the
Closing Date. Once Buyer and Seller mutually agree to the amount of Performing
Accounts Receivable to which Seller is entitled to receive after the Closing,
excluding those Performing Accounts Receivable attributable to bad checks,
credit card charge backs, and debts older than ninety (90) days, Buyer shall
purchase the performing Accounts Receivable minus fifteen percent (15%) for
the
risk and cost of collection. Should Buyer receive funds on a Performing Account
Receivable after Closing that (i) rightfully belong to Seller, and (ii) was
not
previously purchased by Buyer at a discount, Buyer shall promptly remit such
funds to Seller. However, Buyer shall acquire the Accounts Receivable from
Seller for Room Revenue or Other Revenue Agreements entered into before the
Closing but performed after the Closing.
8.6. Method
of Proration.
All
prorations will be made as of the Closing Date based on a 365-day
year.
8.7. Preliminary
Schedules of Adjustments.
All
prorations and credits shall be based on a “Preliminary Schedule of Adjustments”
prepared in good faith by Seller and approved in writing by Buyer, using the
latest bills or estimates made by Seller from information available. If any
supplemental billing is issued or new information learned with respect to any
of
the foregoing prorations or credits, the same shall be adjusted and prorated
between Seller and Buyer as soon as reasonably possible after the Closing.
In
any event, to the fullest extent possible, Seller and Buyer shall jointly
prepare a final schedule of adjustments within thirty (30) days after Closing
and either party owing the other sum of money shall pay such sum within ten
(10)
days after such final schedule is prepared. The provisions of this Section
8.7
shall survive the Closing Date for a period of one (1) year.
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8.8. Personal
Property Inventory.
Buyer
and Seller shall prepare an inventory (the “Original Inventory”) of Personal
Property as soon as reasonably practicable following the execution and delivery
of this Agreement by Buyer and Seller. Three (3) days before the Closing, Buyer
and Seller shall perform a new inventory (the “New Inventory”) of Personal
Property. To the extent any of the items of Personal Property specified in
the
Original Inventory are not set forth in the New Inventory (and such
disappearance is not due to any act of omission of Buyer or any of its
affiliates or agents), the Purchase Price shall be adjusted to reflect the
reduction of Personal Property set forth in the New Inventory. For purposes
of
calculating such adjustments, the parties shall assign values to the Personal
Property equal to the actual cost (less depreciation) of such items or, if
such
actual cost/depreciation data is not available, then the value shall be based
on
the parties’ mutual good faith estimate of the current fair market value of the
particular item(s) of Personal Property.
9.1. Seller.
Seller
shall pay the ALTA
Form B extended coverage title policy including appropriate insurance, zoning
and nonimputation endorsements, documentary stamps and intangibles taxes,
transfer taxes, one-half (1/2) of any fees charged by the Escrow Holder,
one-half (1/2) of a Phase I environmental audit, one-half (1/2) of the cost
of
the Survey, and Seller’s
share of prorations.
9.2. Buyer.
Buyer shall pay the cost of any title endorsements, its own inspection and
recording costs, one-half (1/2) of any fees charged by the Escrow Holder,
one-half (1/2) of a Phase I environmental audit, one-half (1/2) of the cost
of
the Survey, and Buyer’s
share of prorations.
9.3. Other
Closing Costs.
Buyer
and Seller
will each pay their own legal and professional fees and fees of other
consultants incurred by Buyer and Seller, respectively. All other closing costs
and expenses will be allocated between Buyer and Seller in accordance with
the
customary practice in Pershing County, Nevada.
10. Delivery
of
Possession.
Simultaneously with the delivery of the fully executed Transfer Documents,
Seller shall deliver possession and enjoyment of the Property to Buyer subject
only to the encumbrances set forth in the Permitted Exceptions.
11.1. By
Seller.
Seller
will defend, indemnify and hold Buyer and its respective officers, directors,
agents, members, shareholders, representatives, employees, attorneys,
affiliates, beneficiaries, subsidiaries, successors and assigns (collectively,
the “Buyer Indemnitees”) harmless from and against:
11.1.1. All
claims, demands, liabilities, liens, costs, expenses, penalties, damages and
losses (including, but not limited to, reasonable attorneys’ fees and costs) of
every kind of nature incurred or accrued before the Closing Date with respect
to
the Property resulting from Seller’s acts or omissions;
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11.1.2. All
liabilities and obligations arising from any breach of warranties,
representation, covenants, and agreements of Seller or its agents contained
in
this Agreement. The payment of the balance of the Deposit pursuant to Section
1.19 shall mean than Buyer has satisfactorily completed its due diligence
(reserving only a final walk-through inspection of the Personal Property prior
to close). At close Buyer accepts the Real Property and personal property “as
is” without warranty except for the express warranties set forth in section 4
hereof.
11.1.3. The
foregoing indemnification by Seller shall survive the Closing Date for a period
of one (1) year.
11.2. By
Buyer.
Buyer
will defend, indemnify, and hold Seller and each of its officers, directors,
agents, shareholders, representatives, employees, attorneys, affiliates,
beneficiaries, subsidies, successors, and assigns (collectively, the “Seller
Indemnitees”) harmless from and against:
11.2.1. All
claims, demands, liabilities, liens, costs, expenses, penalties, damages, and
losses (including, but not limited to, reasonable attorneys’ fees and costs) of
every kind and nature incurred or accrued subsequent to the Closing Date with
respect to the Property resulting from Buyer’s acts or omissions;
and
11.2.2. All
liabilities and obligations arising from any breach of the warranties,
representations, covenants, and agreements of Buyer or its agents contained
in
this Agreement, without limitation, any WARN Act liability or liability arising
from or out of the operation of the Business.
11.2.3. The
foregoing indemnification by Buyer shall survive the Closing Date for a period
of one (1) year.
11.3. Third
Party Claims
11.3.1. Notice
of Third Party Claim.
11.3.1.1. If
any
third party makes any claim or brings any action, suit, or proceeding against
the indemnitee (a “Third Party Claim”), it is a condition precedent to the
indemnitor’s obligation to indemnify against that Third Party Claim that the
indemnitee notify the indemnitor
11.3.1.1.1. in
writing, and in reasonable detail, of the Third Party Claim; and
11.3.1.1.2. reasonably
promptly, but in no event later than twenty (20) business days after the
indemnitee’s receipt of written notice of the Third Party Claim.
Page
23
of 31
11.3.1.2. If
the
indemnitee fails to give proper notice, the indemnitor is still obligated to
indemnify the indemnitee, except that the indemnitor is not liable for any
Litigation Expenses the indemnitee incurs during the period in which the
indemnitee failed to give proper notice.
11.3.2. The
Indemnitor’s Assumption of the Defense.
If the
indemnitor wishes to assume the defense of the Third Party Claim, it shall
do so
by sending notice of the assumption to the indemnitee. The indemnitor’s
assumption of the defense acknowledges its obligation to indemnify. Promptly
after sending the notice, the indemnitor shall choose and employ independent
legal counsel of reputable standing. After sending the notice, the indemnitor
is
entitled to contest, pay, settle, or compromise the Third Party Claim as it
may
determine.
11.3.3. The
Indemnitee’s Right to Undertake the Defense.
Despite
the provisions of subsection 11.3.2, the indemnitee is entitled to
11.3.3.1. participate
in the defense of a Third Party Claim; and
11.3.3.2. defend
a
Third Party Claim with counsel of its own choosing and without the participation
of the indemnitor if
11.3.3.2.1. the
indemnitor fails or refuses to defend the Third Party Claim on or before the
twentieth (20th)
business day after the indemnitee’s receipt of written notice of the Third Party
Claim; or
11.3.3.2.2. representation
of the indemnitor and the indemnity by the same counsel would, in the opinion
of
that counsel, constitute a conflict of interest.
11.3.4. Litigation
Expenses.
The
indemnitor shall pay for the Litigation Expenses incurred by the indemnitee
to
and including the date of the indemnitor assumes the defense of the Third Party
Claim. Upon the indemnitor’s assumption of the defense of the Third Party Claim,
the indemnitor’s obligation ceases for any Litigation Expenses the indemnitee
subsequently incurs in connection with the defense of the Third Party Claim.
Despite the previous sentence, the indemnitor is liable for the indemnitee’s
Litigation Expenses, if
11.3.4.1. the
indemnitee has employed counsel in accordance with the provisions of subsection
11.3.3.2; or
11.3.4.2. the
indemnitor has authorized in writing the employment of counsel and stated in
that authorization the dollar amount of Litigation Expenses for which the
indemnitor is obligated.
12. Condemnation
and
Destruction.
Page
24
of 31
12.1. Eminent
Domain or Taking.
If
proceedings under a power of eminent domain relating to the Property or any
part
thereof are commenced before the Closing Date, Seller shall promptly inform
Buyer in writing.
12.1.1. If
such
proceeding involves the taking of title to all or any material interest in
the
Property (as determined by Buyer in its reasonable discretion), Buyer may elect
to terminate this Agreement by written notice to Seller within thirty (30)
days
of Seller’s written notice to Buyer, in which case the Deposit and any interest
thereon will be returned to Buyer and neither party shall have any further
obligation to or rights against the other except any rights or obligations
of
either which are expressly stated to survive termination of this
Agreement.
12.1.2. If
the
proceedings do not involve the taking of title to all or a material interest
in
the Property (as determined by Buyer in its reasonable discretion) or if Buyer
does not elect to terminate this Agreement, this transaction will be consummated
as described in this Agreement and any award of settlement payable with respect
to such proceeding will be paid or assigned to Buyer upon Closing.
12.2. Damage
and Destruction.
Except
as provided in this paragraph, before the Close of Escrow, the entire risk
of
loss or damage by earthquake, flood, hurricane, landslide, fire, or other
casualty is borne and assumed by Seller. If, before the Closing Date, any part
of the Property is damaged or destroyed by earthquake, flood, landslide, fire,
or other casualty, Seller will promptly inform Buyer of such fact in writing
and
advise Buyer as to the extent of the damage.
12.2.1. If
such
damage or destruction is material (as determined by Buyer in its sole and
absolute discretion), Buyer has the option to refuse to Close and terminate
this
Agreement upon written notice to Seller given not later than fifteen (15) days
after the receipt of Seller’s written notice to Buyer advising of such damage or
destruction.
12.2.2. If
this
Agreement is terminated under this Section 12.2.2, Buyer will be entitled to
the
return of the Deposit, together with any interest thereon.
12.2.3. If
Buyer
does not timely exercise its option to terminate this Agreement, or if the
casualty is not material (as determined by Buyer in its sole and absolute
discretion), Seller will assign to Buyer all of Seller’s right, title, and
interest in and to any insurance proceeds under Seller’s insurance policies
relating to such damage or destruction, and shall reduce the Purchase Price
by
the amount of the deductible and Seller’s co-insurance, if any, under such
policy and this transaction will close pursuant to the terms of this
Agreement.
13.1. Buyer’s
Remedies Generally.
IN THE
EVENT THE CLOSING FAILS TO OCCUR BECAUSE OF THE CONDITIONS PRECEDENT SET FORTH
IN SECTION 7.1 OF THIS AGREEMENT ARE NOT SATISFIED OR WAIVED, THEN BUYER SHALL
HAVE THE RIGHT TO TERMINATE THIS AGREEMENT UPON WRITTEN NOTICE TO SELLER. UPON
SUCH TERMINATION, BUYER’S SOLE RECOURSE SHALL BE TO REQUIRE
Page
25
of 31
SELLER
TO
RETURN, OR CAUSE THE TITLE COMPANY TO RETURN, TO BUYER ALL DOCUMENTS AND FUNDS
THERETOFORE DEPOSITED OR PAID BY BUYER, INCLUDING, WITH OUT LIMITATION, THE
DEPOSIT.
13.2. Seller’s
Remedies Generally.
IN THE
EVENT THE CLOSING FAILS TO OCCUR BECAUSE (I) BUYER, THROUGH NO FAULT OF SELLER,
CHOOSES NOT TO CLOSE OR (II) THE CONDITIONS PRECEDENT SET FORTH IN SECTION
7.2
OF THIS AGREEMENT ARE NOT SATISFIED OR WAIVED, THEN SELLER, AS ITS SOLE AND
EXCLUSIVE REMEDY, MAY TERMINATE THIS AGREEMENT BY NOTIFYING BUYER THEREOF AND
RECEIVE OR RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES. THE PARTIES AGREE THAT
SELLER WILL SUFFER DAMAGES IN THE EVENT OF BUYER’S DEFAULT ON ITS OBLIGATIONS
UNDER THIS AGREEMENT. ALTHOUGH THE AMOUNT OF SUCH DAMAGES IS DIFFICULT OR
IMPOSSIBLE TO DETERMINE, THE PARTIES AGREE THAT THE AMOUNT OF THE DEPOSIT IS
A
REASONABLE ESTIMATE OF SELLER’S LOSS IN THE EVENT OF BUYER’S DEFAULT. THUS,
SELLER SHALL ACCEPT AND RETAIN THE DEPOSIT AS LIQUIDATED DAMAGES, BUT NOT AS
A
PENALTY. SUCH LIQUIDATED DAMAGES SHALL CONSTITUTE SELLER’S SOLE AND EXCLUSIVE
REMEDY.
13.3. SELLER
AND BUYER ACKNOWLEDGE THAT THEY HAVE READ AND UNDERSTAND THE PROVISIONS OF
THE
FOREGOING SECTIONS 13.1 AND 13.2 AND BY THEIR SIGNATURES IMMEDIATELY BELOW
AGREE
TO BE BOUND BY ITS TERMS.
|
BUYER:
AWI
Gaming, Inc., a Nevada corporation
By:/s/
Xxxxx
Xxxxxx
Name:
Xxxxx Xxxxxx
Title:
President
|
SELLER:
Xxxxxx
X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”),
and Log Cabin, Inc., a Nevada corporation
By:/s/
Xxxxxx x.
Xxxxxxx-Xxxxx
Name:
Xxxxxx X. Xxxxxxx-Xxxxx
Title:
_________________________________
|
Page
26
of 31
14. Notice.
All
notices, requests, demands, or documents, which are required or permitted to
be
given or served hereunder shall be in writing and (a) delivered personally;
(b)
delivered by a national overnight courier (i.e., FedEx); or (c) transmitted
by
facsimile, addressed as follows:
|
If
to Seller:
|
Xxxxxx
X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”),
and Log Cabin, Inc.
Address:
Facsimile
No.:
Attn:
Xxxxxx X. Xxxxxxx-Xxxxx
|
|
With
a copy to:
|
Xxxx
Xxxxxxx, Esq.
Xxxxxxx,
Test, Xxxxxx & Xxxxxxx
000
Xxxx Xxxxx Xxxx
Xxxx,
Xxxxxx 00000
Facsimile
No.: (000)000-0000
|
|
If
to Buyer:
With
a copy to:
|
AWI
Gaming, Inc.
000
Xxxxx Xxxxx
Xxx
Xxxxx, Xxxxxx 00000
Facsimile
No.: (000)000-0000
Attn:
Xxxxx Xxxxxx
Xxxxxx
Xxxxxxx, Esq.
General
Counsel
American
Wagering, Inc.
000
Xxxxx Xxxxx
Xxx
Xxxxx, Xxxxxx 00000
Facsimile
No.: (000)000-0000
|
Notice
shall be deemed to have been delivered only upon actual delivery to the intended
addressee in the case of personal, courier, or facsimile deliver. The addresses
for purposes of this paragraph may be changed by giving written notice of such
change in the manner provided herein for giving notices. Unless such written
notice is delivered, the latest information stated by written notice, or
provided herein if no written notice of change has been delivered, shall be
deemed to continue in effect for all purposes hereunder.
Page
27
of 31
15.1. Survival.
Except
as otherwise set forth in this Agreement, the representations, warranties,
covenants, acknowledgments, arrangement and indemnities contained in this
Agreement and Exhibits, or in any of the documents or agreements executed and/or
delivered and/or exchanged pursuant to the terms of this Agreement, shall
survive the Closing Date for a period of one (1) year and shall not be deemed
to
have merged or terminated upon the Closing Date.
15.2. Parties
in Interest.
As and
when used herein, the terms “Seller” and “Buyer” mean and include, in this
Agreement, their respective successor and assigns and shall be binding upon
and
inure to the benefit of, the above-named Seller and Buyer and their respective
successors and permitted assigns.
15.3. Section
Headings.
The
headings of sections are inserted only for convenience and shall in no way
define, describe, or limit the scope or intent of any provision in this
Agreement.
15.4. No
Oral Modifications.
This
Agreement may not be amended or modified except in writing executed by all
parties hereto.
15.5. Full
Integration.
Buyer
and Seller each acknowledge that there are no other agreements or
representations, either oral or written, express or implied, that are not
embodied in this Agreement and this Agreement, the Exhibits attached to this
Agreement, and the Transfer Documents represent a complete integration of all
the prior and contemporaneous agreements, understandings and
documents.
15.6. Binding
Effect.
This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns and no other party shall be a
beneficiary hereunder.
15.7. Advice
of Counsel.
Buyer
and Seller each acknowledge that: (a) it has not made any representation as
to
the Federal or State tax implication relating to the transactions contemplated
herein; (b) it has thoroughly read and reviewed the terms and provisions of
this
Agreement and the Exhibits attached hereto and is familiar with the terms of
this Agreement; (c) the terms and provisions contained in this Agreement are
clearly understood by it and have been fully unconditional consented to by
it;
(d) it has had full benefit and advice of counsel of its own selection in regard
to understanding the terms, meaning, and effect of this Agreement; (e) the
execution of this Agreement and the Transfer Documents is done freely,
voluntarily, with full knowledge and without duress; and (f) in executing this
Agreement, it is relying on no other representations, either written or oral,
express or implied, made to it by any other party to this Agreement, and the
consideration received by it under this Agreement has been actual and
adequate.
15.8. Attorneys’
Fees.
If an
action is commenced by a party hereto resulting from a dispute with respect
to
the transactions contemplated herein, the prevailing party shall be entitled
to
recover its reasonable attorneys’ fees and costs from the other party in such
action. As used herein, the term “attorneys’ fees” means attorneys’ fees,
whether or not litigation ensues, and if litigation ensues, whether incurred
at
trial, on appeal, or discretionary review or otherwise.
Page
28
of 31
15.9. Governing
Law.
This
Agreement will be governed by, interpreted under, and construed and enforced
in
accordance with the laws of the State of Nevada, with venue in Las Vegas,
Nevada. Each of the parties hereto acknowledges and agrees that the laws of
the
State of Nevada and the selection of venue in Washoe, Nevada were freely chosen
by Buyer and Seller.
15.10. Confidentiality.
Unless
otherwise agreed to in writing by Seller and Buyer:
15.10.1. Each
party will use reasonable efforts to keep confidential the specific economic
terms of this Agreement with the exception of disclosures required in all public
filings, AWI, Buyer’s agents, and representatives of the Gaming Authority, who
need knowledge and information in order to effectuate the transaction
contemplated herein.
15.10.2. Neither
Buyer nor Seller shall willfully issue any public announcement or press release
without first giving the other party a reasonable opportunity to comment on
the
timing and the terms of the announcement or release.
15.10.3. The
provisions of this Section 15.10 shall not prevent Buyer and Seller or any
affiliates of either of them from making such filings as may be required by
applicable law, securities regulatory bodies or securities exchanges, provided
that the test of the information has been delivered to Seller. The provisions
of
this paragraph will survive the termination of this Agreement, other than by
Closing.
15.11. Captions.
The
captions contained in this Agreement are for convenience only and are not
intended to limit or define the scope of effect of any provision of this
Agreement.
15.12. Severability.
The
invalidity, illegality, or unenforceability of any provision of this Agreement
shall not affect the enforceability of any other provision of this Agreement,
all of which shall remain in full force and effect
15.13. Time
of the Essence.
Time is
of the essence with respect to this Agreement and of the obligations required
hereunder.
15.14. Non-waiver.
No
delay or failure by any party to exercise any right hereunder, and no partial
or
single exercise of any such right, shall constitute a waiver of that or any
other right, unless otherwise expressly provided herein.
15.15. Facsimile.
The
parties hereto and their respective successors and assigns are hereby authorized
to rely upon the signatures of each person and entity on this Agreement which
are delivered by facsimile as constituting a duly authorized, irrevocable,
actual, current deliver of this Agreement with original ink signatures of each
person and entity.
15.16. Further
Assurances.
Buyer
and Seller agree to execute all documents and instruments reasonably required
in
order to consummate the purchase and sale contemplated in this
Agreement.
Page
29
of 31
15.17. Counterparts.
This
Agreement may be executed in any number of counterparts and each such
counterpart shall be deemed to be an original, but all of which, when taken
together, shall constitute one Agreement.
15.18. Escrow
Holder.
In
performing its duties hereunder, Escrow Holder shall not incur any liability
to
anyone for any damages, losses or expenses, except for its negligence or
intentional misconduct, and it shall accordingly not incur any such liability
with respect to (a) any action taken or omitted in good faith upon advice of
its
counsel or (b) to any action taken or omitted in reliance upon any instrument,
including any written notice or instruction provided in this Agreement, not
only
as to its due execution and the validity and effectiveness of its provisions,
but also as to the truth and accuracy of any information contained therein,
that
Escrow Holder shall in good faith believe to be genuine, to have been signed
or
presented by a proper person, and to conform to the provisions of this
Agreement. Seller and Buyer hereby agree to indemnify and hold harmless Escrow
Holder against any losses, claims, damages, liabilities, and expenses ,
including reasonable costs for investigation and legal fees and disbursements,
that may be imposed upon Escrow Holder or incurred by Escrow Holder in
connection with its acceptance or performance of its duties hereunder, including
any litigation arising out of this Agreement or involving the subject matter
hereof, unless resulting from Escrow Holder’s negligence or intentional
misconduct. If any dispute shall arise between Buyer and Seller sufficient
in
the discretion of Escrow Holder to justify doing so, Escrow Holder shall be
entitled to tender into the registry or custody of the clerk of any state court
of general jurisdiction located in Washoe County, Nevada or the clerk for the
United States District Court for the District of Nevada in Washoe County,
Nevada, any money, property, or documents in its hands relating to this
Agreement, together with such pleadings as it shall deem appropriate, and
thereupon be discharged from all further duties and liabilities under this
Agreement. Seller and Buyer all bear all costs and expenses of any such legal
proceedings equally.
Buyer
and
Seller have executed this Agreement as of the date first written
above.
|
BUYER:
AWI
Gaming, Inc., a Nevada corporation
By:/s/
Xxxxx
Xxxxxx
Name:
Xxxxx Xxxxxx
Title:
President
|
SELLER:
Xxxxxx
X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”),
and Log Cabin, Inc., a Nevada corporation
By: /s/
Xxxxxx X.
Xxxxxxx-Xxxxx
Name:
Xxxxxx X. Xxxxxxx-Xxxxx
Title:
Trustee and President
|
Page
30
of 31
INTENTIONALLY
LEFT
BLANK
Page
31
of 31
ESCROW
AGENT ACCEPTANCE
Escrow
Agent hereby acknowledges receipt of the foregoing Agreement
and agrees that the provisions of the foregoing Agreement shall consitute its
escrow instructions and that it will act as Escrow Agent in accordance with
the
terms and conditions thereof.
WESTERN
TITLE
COMPANY, INC.
By:_____________________________
Its:______________________________
Escrow
No. 150576-TME
EXHIBIT
"1"
Exhibit
“1”
GRANT,
BARGAIN SALE AND DEED
When
recorded, return to:
Xxxxxx
Xxxxxxx, Esq.
General
Counsel
American
Wagering, Inc.
000
Xxxxx
Xxxxx
Xxx
Xxxxx, Xxxxxx 00000
GRANT,
BARGAIN SALE AND DEED
For
the
consideration of One Million Eight Hundred Thousand Dollars and other valuable
consideration, the receipt whereof is hereby acknowledged, Xxxxxx X.
Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument dated
September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”), and Log
Cabin, Inc., a Nevada corporation (“Log Cabin”), (Xxxxxxx-Xxxxx and Log Cabin
hereinafter “Grantor”), does hereby grant, bargain, sell and convey to AWI
Gaming, Inc., a Nevada corporation (“Grantee”), all that real property situated
in the County of Xxxxx, State of Nevada, which is described on Schedule A
attached
hereto and made a part hereof (the “Property”), together with any improvements,
buildings, structures, and fixtures located thereon; all easements, if any,
benefiting the Property; all rights, benefits, privileges, tenements,
hereditaments and appurtenances pertaining to the Property, including any
right,
title and interest of Grantor in and to any property lying in or under the
bed
of any street, alley, road or right-of-way, open or proposed, abutting or
adjacent to the Property; the strips, gaps or gores, if any, between the
Property and abutting property; any water, water rights, oil, gas or other
mineral interests in, on, under or above the Property; and any rights and
interests to receive condemnation awards from any condemnation proceeding
pertaining to the Property, sewer rights, water courses, xxxxx, ditches and
flumes located on or appurtenant to the Property.
Subject
to only those items listed on Schedule B
attached
hereto and made a part hereof.
Grantor
hereby binds itself and its successors to warrant and defend the title, as
against all persons whomsoever, subject only to the matters above set
forth.
IN
WITNESS WHEREOF, the undersigned has executed this Grant, Bargain and Sale
Deed
as of the _____ day of ______________, 2005.
GRANTOR:
Xxxxxx
X.
Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument dated
September 17, 1986 and amended September 18, 1991, and Log Cabin, Inc., a
Nevada
corporation
By:___________________________________
Name:_________________________________
Its:___________________________________
STATE
OF
NEVADA )
)
ss.
County
of
Xxxxx
)
On
this
_____ day of __________________, 2004, before me a Notary Public personally
appeared ______________(name
of xxxxxx above),
the
Manager of ____________(name of Seller) a _______________(type of entity),
personally known to me (or proved to me on the basis of satisfactory evidence)
to be the person whose name is subscribed to this instrument and acknowledged
that he executed the same on behalf of the company.
Notary
Public
My
Commission Expires:
_____________________
Schedule
A to Exhibit 1 GRANT, BARGAIN SALE AND DEED
Legal
Description
Schedule
B to Exhibit 1 GRANT SALE AND DEED
Permitted
Exceptions
EXHIBIT
"A"
ASSIGNMENT
AND ASSUMPTION AGREEMENT
THIS
ASSINGMENT AND ASSUMPTION AGREEMENT (this “Agreement”) is dated as of
______________________, 2005, among Xxxxxx X. Xxxxxxx-Xxxxx as Trustee of
the
Xxxxxxx Family Trust under instrument dated September 17, 1986 and amended
September 18, 1991 (“Xxxxxxx-Xxxxx”), Log Cabin, Inc., a Nevada corporation
(“Log Cabin”), (Xxxxxxx-Xxxxx and Log Cabin hereinafter “Assignor”) and AWI
Gaming, Inc., a Nevada corporation (“Assignee”).
Assignor
and Assignee are parties to that certain Purchase Agreement dated as of June
_____, 2005 (the “Purchase Agreement”). Capitalized terms not defined in this
instrument shall have the meanings given to them in the Purchase Agreement.
Under the terms and conditions of the Purchase Agreement, Assignor has agreed
to
assign all right, title and interest of Assignor in the contracts attached
hereto as Schedule 1 and made a part hereof (the “Contracts”) and Assignee has
agreed to assume all of Assignor’s obligations arising under the
Contracts.
There
parties agree that Assignor gives, grants, bargains, sells, assigns, transfers,
conveys, delivers, sets over and confirms unto Assignee all of Assignor’s right,
title and interest, legal and equitable, in and to the Contracts and Assignees
assumes and agrees to perform and discharge when due any obligation and
liabilities of Assignor arising under the Contracts from and after the date
of
this Agreement.
TO
HAVE
TO HOLD the contracts unto Assignee, its successors and assigns, to its and
their own proper use.
A. Assignor,
for itself and its successors and assigns, covenants that at any time and
from
title to time after the delivery of this instrument, at Assignee’s request and
without further consideration, Assignor will do, execute, acknowledge and
deliver, or will cause to be done, executed, acknowledged and delivered,
such
further acts, conveyances, transfers, assignments, powers of attorney and
assurances as Assignee reasonably may request and as may be necessary to
more
effectively convey, transfer, and vest in Assignee any of the rights and
benefits conferred to Assignor under the Contracts, or to better effectuate
the
intent and purposes thereof.
B. Nothing
in this Agreement, express or implied, is intended or shall be construed
to
confer upon or give to any person, firm, or corporation other than Assignee
and
its successors and assigns, any remedy or claim under or by reason of this
instrument or any term, covenant, or condition hereof, and all the terms,
covenants and conditions shall be for the sole and exclusive benefit of Assignee
and its successors and assigns.
C. This
Agreement and related instruments of transfer or assignment delivered hereunder
shall be construed in accordance with and governed for all purposes by the
law
and public policy of the State of Nevada.
D. This
Agreement may be executed in any number of counterparts, each of which shall
be
an original but all of which together shall constitute one and the same
instrument. Facsimile copies hereof and facsimile signatures hereon shall
have
the same force and effect of originals.
Assignor
has caused this instrument to be duly executed by its authorized agent as
of the
date first written above.
|
ASSIGNOR:
Xxxxxx
X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”),
and Log Cabin, Inc., a Nevada corporation
By:
_______________________________
Name:
Xxxxxx X. Xxxxxxx-Xxxxx
Title:
_________________________________
|
ASSIGNEE:
AWI
Gaming, Inc., a Nevada corporation
By:
______________________________
Name:
Xxxxx Xxxxxx
Title:
President
|
Exhibit
“A”
Schedule
1
Contracts
| 1. |
The
CIT Group—Leased Credit card terminals.
|
| 2. |
Puget
Sound Leasing—Leased Point of sale
system.
|
| 3. |
Sierra
Nevada Cash Register—Leased Phone modem
software.
|
| 4. |
IOS
Capital Lease—Leased Copy machine.
|
| 5. |
Ecotemp—Leased
Dish machine.
|
| 6. |
Olympic
Compactor—Leased Trash compactor.
|
| 7. |
Xxxxxx’x—Leased
Voice mail system and license.
|
| 8. |
Vogue
Linens—Leased uniforms and linens.
|
| 9. |
Nevada
Logos—Leased Highway information signs.
|
| 10. |
Ecolab—Pest
Control.
|
| 11. |
Desert
Hills Electric—Video security system
maintenance.
|
| 12. |
Muzak—Casino
overhead music.
|
| 13. |
YESCO
Outdoor—Highway billboard, I-80 near Battle Mountain,
Nevada.
|
| 14. |
YESCO
Outdoor—Highway billboard, U.S. 95 near Mcdermitt,
Nevada.
|
| 15. |
YESCO
Outdoor-Highway billboard (2), I-80 near Winnemucca,
Nevada.
|
| 16. |
YESCO—Maintenance
agreement for signage, set for a term of 60 monts at $1,664.48 per
month.
|
| 17. |
The
ATM store—ATM machine.
|
| 18. |
XXXXX
Outdoor—Highway billboard, Rye Patch,
Nevada
|
| 19. |
SBC—Long
Distance.
|
| 20. |
YESCO
Outdoor—Highway billboard, I-80 Lovelock,
Nevada
|
EXHIBIT
"B"
ASSIGNMENT
OF INTELLECTUAL PROPERTY
THIS
ASSINGMENT OF INTELLECTUAL PROPERTY (this “Assignment”) is dated as of
______________________, 2005, among Xxxxxx X. Xxxxxxx-Xxxxx as Trustee of
the
Xxxxxxx Family Trust under instrument dated September 17, 1986 and amended
September 18, 1991 (“Xxxxxxx-Xxxxx”), Log Cabin, Inc., a Nevada corporation
(“Log Cabin”), (Xxxxxxx-Xxxxx and Log Cabin hereinafter “Assignor”) and AWI
Gaming, Inc., a Nevada corporation (“Assignee”), under the terms of that certain
Purchase Agreement dated as of June _____, 2005 (the “Purchase Agreement”),
between Assignor and Assignee. Capitalized terms not defined in this instrument
shall have the meanings given to them in the Purchase Agreement.
There
parties agree that Assignor gives, grants, assigns, transfers, and conveys
to
Assignee all of Assignor’s right, title and interest in, to and under the
Intellectual Property.
Assignor
covenants that it will, at any time and from time to time upon written request
thereof, execute and deliver to Assignee, its nominees, successors and/or
assigns, any new or confirmatory instruments and do and perform any other
acts
which Assignee, its nominees, successors, and/or assigns, may reasonably
request
in order to fully assign and transfer to and vest in Assignee, its nominees,
successors and/or assigns, and protect its and/or their rights, title and
interest in and enjoyment of, all the assets of Assignor intended to be
transferred and assigned hereby, or to enable Assignee, its nominees, successors
and/or assigns, to realize upon or otherwise enjoy any such assets.
Assignor
agrees to indemnify, defend, protect, and hold harmless Assignee from and
against any and all liability, loss, cost, damage, and expense (including,
without limitation, attorneys’ and paralegals’ fees and costs) asserted against,
incurred or suffered by Assignee relating to Assignor’s obligations with respect
to the Intellectual Property arising before the date hereof. The provisions
of
Section 11.3 also shall apply.
By
its
acceptance hereof, Assignee agrees to perform or cause to be performed
Assignor’s obligations, if any, under the Intellectual Property from and after
the date of this instrument, and agrees to indemnify, defend, protect, and
hold
Assignor harmless from and against any liability, loss, cost, damage, and
expense (including, without limitation, attorneys’ and paralegals’ fees and
costs) asserted against, incurred or suffered by Assignor relating thereto
and
arising after the date hereof. The provisions of Section 11.3 also shall
apply.
The
provisions of this Assignment shall be binding upon and inure to the benefit
of
Assignor, Assignee, and their successors and permitted assigns.
Assignor
has caused this instrument to be duly executed by its authorized agent as
of the
date first written above.
|
ASSIGNOR:
Xxxxxx
X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”),
and Log Cabin, Inc., a Nevada corporation
By:
_______________________________
Name:
Xxxxxx X. Xxxxxxx-Xxxxx
Title:
_________________________________
|
ASSIGNEE:
AWI
Gaming, Inc., a Nevada corporation
By:
______________________________
Name:
Xxxxx Xxxxxx
Title:
President
|
EXHIBIT
"C"
XXXX
OF SALE
For
good
and valuable consideration, receipt and sufficiency of which is hereby
acknowledged, the undersigned, Xxxxxx X. Xxxxxxx-Xxxxx as Trustee of the
Xxxxxxx
Family Trust under instrument dated September 17, 1986 and amended September
18,
1991 (“Xxxxxxx-Xxxxx”), Log Cabin, Inc., a Nevada corporation (“Log Cabin”),
(Xxxxxxx-Xxxxx and Log Cabin hereinafter “Seller”), and AWI Gaming, Inc., a
Nevada corporation (“Buyer”), under that certain Purchase Agreement dated
___________________________, 2005 (the “Purchase Agreement”), the Personal
Property (as defined in the Purchase Agreement).
Seller
hereby represents and warrants that the assets transferred hereunder are
owned
by Seller free and clear of all mortgages, liens, encumbrances, claims of
any
nature whatsoever, except for the existing mortgages, liens, encumbrances,
and
claims disclosed in the Purchase Agreement, Seller will warrant and defend
title
to the same, and will indemnify, defend, protect and hold Buyer harmless
against
the claims and demands of any persons, firms, and entities arising therefrom
or
with respect thereto.
Seller
hereby covenants that it will, at any time and from time to time upon written
request thereof, execute and deliver to Buyer any new or confirmatory
instruments and do and perform any other acts which Buyer may reasonably
request
in order to fully assign and transfer to and vest in Buyer and protect its
rights, title and interest in and enjoyment of, all of the assets of Seller
intended to be transferred and assigned hereby, or to enable Buyer to realize
upon or otherwise enjoy any such assets.
All
references to “Seller” and “Buyer” herein shall be deemed to include their
respective heirs, representatives, nominees, successors and/or assigns, where
the context permits.
Dated:
_______________________, 2005
|
SELLER:
Xxxxxx
X. Xxxxxxx-Xxxxx as Trustee of the Xxxxxxx Family Trust under instrument
dated September 17, 1986 and amended September 18, 1991 (“Xxxxxxx-Xxxxx”),
and Log Cabin, Inc., a Nevada corporation
By:
_______________________________
Name:
Xxxxxx X. Xxxxxxx-Xxxxx
Title:
_________________________________
|
BUYER:
AWI
Gaming, Inc., a Nevada corporation
By:
______________________________
Name:
Xxxxx Xxxxxx
Title:
President
|
EXHIBIT
"D"
Exhibit
“D”
Equipment
Leases
| 1. |
The
CIT Group—Leased Credit card terminals.
|
| 2. |
Puget
Sound Leasing—Leased Point of sale
system.
|
| 3. |
Sierra
Nevada Cash Register—Leased Phone modem
software.
|
| 4. |
IOS
Capital Lease—Leased Copy machine.
|
| 5. |
Ecotemp—Leased
Dish machine.
|
| 6. |
Olympic
Compactor—Leased Trash compactor.
|
| 7. |
Xxxxxx’x—Leased
Voice mail system and license.
|
| 8. |
Vogue
Linens—Leased uniforms and linens.
|
| 9. |
Nevada
Logos—Leased Highway information signs.
|
| 10. |
Ecolab—Pest
Control.
|
| 11. |
Muzak—Casino
overhead music.
|
| 12. |
The
Economic Development Office occupy the small building near the
Motel units
on an oral, month to month rent free
basis.
|
| 13. |
YESCO
Outdoor—Highway billboard, I-80 near Battle Mountain,
Nevada.
|
| 14. |
YESCO
Outdoor—Highway billboard, U.S. 95 near Mcdermitt,
Nevada.
|
| 15. |
YESCO
Outdoor-Highway billboard (2), I-80 near Winnemucca,
Nevada.
|
| 16. |
YESCO
Outdoor—Highway billboard, I-80 Lovelock,
Nevada
|
| 17. |
XXXXX
Outdoor—Highway billboard, Rye Patch,
Nevada
|
EXHIBIT
"E"
Exhibit
"E"
Legal
Description
EXHIBIT
"F"
Exhibit
“F”
Licenses
and Permits
The
following permits are believed by Seller to be non-transferable:
| 1. |
State
and county gaming licenses.
|
| 2. |
Special
Tax Stamp issued by the Bureau of Alcohol, Tobacco, and
Firearms.
|
| 3. |
Nevada
State Division of Health Food Establishment
Permit.
|
| 4. |
Nevada
State Division of Health Drinking Establishment
Permit.
|
| 5. |
City
of Lovelock Liquor License.
|
| 6. |
City
of Lovelock License for the motel rooms at the main
complex.
|
| 7. |
City
of Lovelock License for the Restaurant.
|
| 8. |
Pershing
County Fair and Recreation Board Annual Operators Room Tax
License.
|
| 9. |
State
of Nevada, Department of Taxation Business Licenses for all of the
operations of Sturgeons.
|
| 10. |
Nevada
State Division of Health Public Bathing Facility (pool)
Permit.
|
It
is
Seller’s belief that virtually none of the licenses and permits currently
required and/or in use by Sturgeons will be transferable.
EXHIBIT
"G"
Exhibit
“G”
Motor
Vehicles
1982
Plymouth Voyager—VIN#2P5WB31TCK150034
SCHEDULES
Schedule
2.3
Allocation
of Purchase Price
Sturgeons
Casino
Gaming
Equipment $300,000
Log
Cabin, Inc.
Land
$300,000
Buildings
and
Improvements
$900,000
Furniture,
Fixtures and
Equipmen
$300,000
Total $1,800,000
========
Schedule
3.6.22
List
of Excluded Property
| 1. |
A
paint sprayer in the storage shed located at Sturgeons and certain
hand
tools owned by an employee of Sellers.
|
| 2. |
Music
and other CB’s held in the X.X. xxxxx in the Center Club, all which are
owned by an employee of Sellers.
|
| 3. |
One
cigarette machine which is owned by an employee of Sellers and is
operated
by coins only.
|
| 4. |
All
beverage machines and coolers with logos such as “Coke.” These are not
owned by Sellers.
|
| 5. |
Certain
slot machines related to wide area progressive systems (system games)
described in detail on Schedule 4.1.4.
|
| 6. |
Seller’s
business records and tax returns.
|
| 7. |
Coffee
makers and related equipment owned by the vendor who currently provides
the coffee products to Sturgeons.
|
| 8. |
Cash
on hand, cash in banks, accounts receivable (including amounts receivable
on credit cards taken prior to the closing date) and notes
receivable.
|
| 9. |
Food,
beverage, and supplies inventories.
|
| 10. |
“Excluded
Property” as defined in paragraph
1.25.
|
Schedule
4.13
Transferor’s
Certificate of Non-foreign Person
AFFIDAVIT
OF NON-FOREIGN PERSON
Section
1445 of the Internal Revenue Code provides that a transferee of a U. S. real
property interest must withhold tax if the transferor is a foreign person.
To
inform the transferee that withholding of tax is not required upon the
disposition of a U. S. real property interest by __________(Name
of Seller),
a
_________________(type of entity) (“Transferor”), the undersigned hereby
certifies the following on behalf of Transferor:
1. Transferor
is not a foreign corporation, foreign partnership, foreign trust, or foreign
estate (as those terms are defined in the Internal Revenue Code and Income
Tax
Regulations);
2. Transferor
is not a disregarded entity as defined in Section
1.1445-2(b)2(iii);
3. Transferor’s
U. S. employer identification number is ______________; and
4. Transferor’s
office address is ____________ (address).
Transferor
understands that this certification may be disclosed to the Internal Revenue
Service by transferee and that any false statement contained herein could
be
punished by fine, imprisonment, or both.
Under
penalties of perjury I declare that I have examined this certification and
to
the best of my knowledge and belief it is true, correct and complete, and
I
further declare that I have authority to sign this document on behalf of
Transferor.
Date:
__________________, 2005.
_______________,
(Name)
_______________________(Type of entity)
By:_______________________________________
Name:_____________________________________
Its:_______________________________________
[ACKNOWLEDGMENT
ON FOLLOWING PAGE]
STATE
OF
NEVADA )
)
ss.
County
of
Washoe )
On
this
_____ day of __________________, 2004, before me a Notary Public personally
appeared _____________(Name
of xxxxxx),
the
Manager of _________(name of seller), a________(Type of entity), personally
known to me (or proved to me on the basis of satisfactory evidence) to be
the
person whose name is subscribed to this instrument and acknowledged that
she
executed the same on behalf of the company.
_________________________________________
Notary
Public
My
Commission Expires:
_________________
Schedule
4.1.4
Personal
Property Owner
| 1. |
All
property referenced on Exhibit D.
|
| 2. |
1
Megabucks slot machine.
|
| 3. |
4
Wheel of Fortune slot machines.
|
| 4. |
2
Twighlite Zone slot machines.
|
Schedule
4.1.7.1
Property
Agreements
None
Schedule
4.1.7.2
Oral
Agreements
| 1. |
Children’s
Arcade Games and Pool Tables—These machines are provided by B & C Pool
under an oral agreement that provides that Sturgeons is to receive
50% of
arcade is also covered under this
agreement.
|
| 2. |
The
Economic Development Office for Lovelock occupies a small separate
building near the motel units on an oral, month-to-month rent
free
basis.
|
| 3. |
The
residence located on the Xxxxxxxx’x property is currently occupied by Xxxx
Xxxx, a current employee of Xxxxxxxx’x, on an oral, month-to-month rent
free basis. Also, the washer and dryer located within the residence
is the
personal property of Xxxx
Xxxx.
|
Schedule
4.1.8
Litigation
None
Schedule
4.1.11
Defaults
None
Schedule
4.1.13.3
Taxes
None
