Exhibit 99
EXECUTION COPY
AMENDED AND RESTATED
RIVERBOAT CASINO SALE AND PURCHASE AGREEMENT
THIS AMENDED AND RESTATED RIVERBOAT CASINO SALE AND PURCHASE AGREEMENT
("Agreement") dated as of the 9th day of August, 2004, as amended and restated
as of this 16th day of September, 2004, by and among President Casinos, Inc.,
debtor and debtor-in-possession ("Seller") in a chapter 11 bankruptcy case,
Case No. 02-53005 (the "Seller Case") pending in the United States Bankruptcy
Court for the Eastern District of Missouri (the "Bankruptcy Court"), President
Riverboat Casino-Missouri, Inc., a Missouri corporation (the "Company") and
Penn National Gaming, Inc., a Pennsylvania corporation ("Buyer").
BACKGROUND:
A. Seller is the owner of all of the Closing Shares (as herein defined) of
the Company, which is also a debtor and debtor-in-possession in a chapter 11
bankruptcy case that is jointly administered with the Seller Case (the
"Company Case" and, collectively with the Seller Case, the "Case").
B. The Company is the owner and operator of a riverboat casino, located on
the Mississippi River riverfront in St. Louis, Missouri and moored to a barge
known as Admiral Barge One and connected by a porte-cochere (collectively, the
"Riverboat Casino"), more particularly described as:
Name: The Admiral
Official No.: 204086
Name: Admiral Barge One
Official No.: 689603
C. An official committee of unsecured creditors (the "Committee") has been
appointed in the Company Case pursuant to section 1102 of the United States
Bankruptcy Code (the "Bankruptcy Code");
D. Seller, with the support of the Committee and certain holders of Seller's
12% Senior Notes due 2001 and 13% Senior Notes due 2001 (the "Bondholders"),
desires to sell, and Buyer desires to purchase, the Closing Shares upon the
terms and conditions set forth in this Agreement and subject to further action
of the Bankruptcy Court;
E. Seller, Buyer and Company have previously entered into that certain
Riverboat Casino Sale and Purchase Agreement dated as of the 9th day of
August, 2004, certain provisions of which were initially reviewed by the
Bankruptcy Court at a hearing on September 8, 2004;
F. Following such September 8, 2004 hearing, each of Seller, Buyer and
Company have agreed to amend and restate such agreement in its entirety to
reflect certain mutually-acceptable changes thereto;
G. Following execution of this Agreement, Seller and the Company shall seek
authority from the Bankruptcy Court to hold an auction at which Buyer's offer
for the Closing Shares shall be subject to higher and better offers of third
parties.
NOW, THEREFORE, in consideration of the mutual covenants and promises
contained herein and other good and valuable consideration, the receipt and
adequacy of which hereby is acknowledged, and with the intent to be legally
bound hereby, the parties agree as follows:
1. PURCHASE AND SALE OF CLOSING SHARES; RIVERBOAT CASINO ASSETS OWNED BY THE
COMPANY; TRADEMARK LICENSE.
(a)Closing Shares to be Sold. Subject to the provisions of this Agreement,
Seller agrees to sell and Buyer agrees to purchase, all of Seller's right,
title and interest in, to and under the Closing Shares, free and clear of any
lien, mortgage, security interest, pledge, encroachment, easement, defect of
title or other claim, charge or encumbrance of any nature whatsoever, or any
restriction on transferability, option, right of first refusal, or restriction
on the use, voting, transfer, receipt of income or other exercise of any
attributes of ownership (in each case other than under Applicable Law)
(collectively, "Encumbrances").
(b) Riverboat Casino Assets Owned by the Company. Immediately following
the Closing, the Company shall have good and marketable title to all assets,
properties and rights owned by the Company or otherwise material to the
operation of the Riverboat Casino wherever such assets, properties and rights
are located, and whether real, personal or mixed, tangible or intangible,
except the Excluded Assets (as defined in Section 9(c)(vii) below)
(collectively, the "Riverboat Casino Assets"), which Riverboat Casino Assets,
to the maximum extent permitted under Section 1141(c) of the Bankruptcy Code,
will be free and clear of all claims and interests of creditors of the
Company, other than the Company Liabilities. Such Riverboat Casino Assets
shall include, but in no way be limited to, the following assets and
properties of the Company:
(i) the Riverboat Casino, together with its furniture, fixtures,
equipment, necessaries, uniforms, apparel, inventory held for resale (other
than Gift Shop Inventory and Food Inventory), supplies held for consumption,
life saving equipment (including life boats and inflatable boats), spare
parts, radio equipment, crockery, plates, cutlery and other similar items,
cordage, general outfit and all other appurtenances and appliances belonging
to the Riverboat Casino, and the Company's parking and transportation shuttles
and other vehicles, whether aboard the Riverboat Casino or on shore at the
time of Closing;
(ii) all of the Company's right, title and interest in and to (A) the
Lease between the Company and the City of St. Louis Port Commission (the "City
Lease") and such other executory leases, subleases, easements, licenses,
concessions or other agreements made for the benefit of the Company listed or
described on Schedule 1(b)(ii)(A), whether written or oral, granting to any
person the right to use or occupy real property (the "Parking Leases"; the
City Lease and the Parking Leases are collectively, the "Real Property
Leases"), (B) the Company's collective bargaining agreement with Hotel
Employees, Restaurant Employees Local 74, AFL-CIO and (C) other executory
leases or contracts either (I) listed on Schedule 1(b)(ii)(C) or (II) entered
into after the date of this Agreement in compliance with the provisions hereof
and designated in writing by Buyer as an "Assumed Executory Lease and
Executory Contract" by no later than three (3) business days after the date on
which the Company Plan of Reorganization (as defined in Section 9(c) below) is
filed (collectively, the "Assumed Executory Leases and Executory Contracts");
(iii) all gambling games, slot machines, tables and other gaming
equipment that are used by the Company in the operation of the Riverboat
Casino, together with the Company's inventory of gaming chips, tokens, scrip,
markers, gaming supplies and other items held for use by the Company at the
Riverboat Casino in the ordinary course of business;
(iv) all cash in cashiers' cages, vaults, carts, drawers, cash registers
and gaming devices and machines ("Included Cash"), which amount shall be no
less than $3,000,000 on the Closing Date;
(v) all food processing and preparation and washing equipment, machines
and fixtures, racks, trays, buffet tables, furniture, flatware, serving xxxx,
utensils, uniforms, napkins, linens and other tangible personal property held
by the Company for use in connection with its food service and dining
facilities at the Riverboat Casino
(vi) to the extent relating to the Company's marketing and operation of
the Riverboat Casino, all books, records, files and papers, whether in hard
copy or computer format, including books of account, sales and promotional
literature, manuals and data, sales and purchase correspondence, lists of
present and former suppliers, personnel and employment records of present or
former employees, documentation developed or used for accounting or, marketing
purposes;
(vii) all of the Company's right, title and interest in and to each of
the following and all copies and other tangible embodiments thereof: (A) the
"Admiral" name and all variants and derivations thereof, and all other
fictitious business names, trademarks (registered and unregistered), service
marks, trade dress, logos, trade names and the goodwill of the Company's
business associated therewith, and all applications, extensions,
registrations, and renewals in connection therewith but excluding Seller's
Trademarks (as defined in Section 1(c) below), which may only be used by Buyer
pursuant to and in accordance with Section 1(c) hereof, (B) all copyrightable
works, all copyrights, and all applications, registrations and renewals in
connection therewith in both published works and unpublished works and (C) all
trade secrets and confidential and other business information (including
ideas, research and development, know-how, formulas, works for hire, gaming,
security and food service processes and techniques, market research, tracking
methods, census reports, designs, drawings, specifications and business and
marketing plans and proposals) (collectively, "Intellectual Property");
(viii) all of the Company's transferable right, title and interest in and
to licenses, permits, franchises, zoning rights, approvals, registrations,
consents and authorizations used in, or necessary to the operation of the
Riverboat Casino as presently operated or the other Riverboat Casino Assets,
including those listed in Schedule 6(i) (collectively "Gaming Licenses");
(ix) all of the Company's right, title and interest in and to all post
office boxes, e-mail addresses, telephone and facsimile numbers and domain
names held for use in connection with the operation of the Riverboat Casino;
(x) all computer software, proprietary or otherwise (including data and
related documentation), sales and promotional literature, manuals, customer
and supplier correspondence, plats, architectural plans, drawings, designs,
blueprints, specifications and studies that are owned or used in connection
with the operation of the Riverboat Casino, in all cases in any form or
medium, other than the Excluded Software;
(xi) all know-how, trade secrets, customer lists and customer and
supplier information, personnel information, technical information, process
technology, plans, drawings, innovations, designs, ideas, proprietary,
blueprints and information and other information, including player tracking
information related to Riverboat Casino Assets, and fixed asset, general
ledger and risk management data (the Company will provide Buyer with
assistance to incorporate the fixed asset, general ledger and risk management
data into Buyer's computer systems) owned or used by the Company in connection
with the operation of the Riverboat Casino;
(xii) all prepaid expenses relating to the Riverboat Casino ("Prepaid
Expenses");
(xiii) all accounts receivable and related deposits, security, or
collateral therefor, including recoverable customer deposits and receivables
(collectively, the "Receivables");
(xiv) all security deposits deposited by or on behalf of the Company as
lessee or sublessee under the Assumed Executory Leases and Executory Contracts
existing on the Closing Date and all deposits of the Company with utilities
and other providers of services to the Riverboat Casino (the "Security
Deposits");
(xv) all of the Company's rights to any indemnity payments relating to
the Riverboat Casino Assets held by the Company; and
(xvi) any credits, carryforwards, operating losses and other attributes
related to Taxes, but excluding any refunds for Taxes described in Section
9(c)(vii)(11) below.
(c) Trademark License. In further consideration of the payment of the
Purchase Price, and the mutual covenants under this Agreement, Seller grants
to Buyer a non-exclusive, fully paid-up right and license to use the names
"President", "President Riverboat Casino" and other related trademarks and
services marks of Seller (collectively, the "Seller's Trademarks") under the
common law and under any trademark or service xxxx registrations in connection
with the Riverboat Casino Assets within a one hundred fifty mile radius of the
St. Louis, Missouri city limits (the "Trademark License"). Seller agrees that
during the term of the Trademark License, Seller will not license the use of
Seller's Trademarks to any other Person. The Trademark License shall be
effective for a period of one year from the Closing Date. Upon expiration of
the Trademark License, Buyer will cease all further use of Seller's Trademarks
and Buyer will have no further rights thereto. Any termination or expiration
of the Trademark License shall not terminate or otherwise affect any other
provision of this Agreement. As used herein, "Person" means any natural
person, business trust, corporation, partnership, limited liability company,
joint stock company, proprietorship, association, trust, joint venture,
unincorporated association or any other legal entity of whatever nature.
2. Consideration.
(a) Purchase Price. The aggregate consideration to be paid by Buyer to
Seller for the Closing Shares shall be the payment of a cash amount equal to
(A) Twenty Eight Million Dollars ($28,000,000), less (B) the Deficiency, if
any, plus (C) the Surplus, if any (the "Purchase Price"). The Purchase Price
shall be payable as follows: (i) Buyer is paying a refundable $1,000,000 cash
deposit (the "Deposit") by wire transfer of immediately available funds to an
escrow account (the "Escrow Account") held by U.S. Bank National Association
as escrow agent under an Escrow Agreement in substantially the form attached
hereto as Exhibit A (the "Escrow Agreement") within three (3) days of the
execution of this Agreement; and (ii) on the Closing Date, (x) the Deposit
(with interest accrued thereon, if any) shall be paid over to Seller from the
Escrow Account and (y) Buyer shall pay the Purchase Price, less the Deposit
(plus interest accrued thereon, if any), by wire transfer of immediately
available funds to such account or accounts as Seller shall direct. The
Purchase Price shall be subject to adjustment by (A) the prorations set forth
in Section 2(b) and (B) the payment of any Cure Amounts (as defined below) by
Buyer in accordance with Section 2(c). If Buyer increases the amount of the
cash consideration offered for the Closing Shares or otherwise modifies the
terms and conditions of its bid as set forth in this Agreement in order to
outbid a proponent of a higher and better offer, then the Purchase Price shall
automatically be increased by an equal amount and/or the terms and conditions
hereof shall be automatically modified and, if Buyer is the successful bidder,
Buyer and Seller shall execute a written instrument to memorialize such
increased Purchase Price (and change in form of consideration, as applicable)
and such modifications to the terms and conditions hereof. All interest and
other earnings on the Deposit shall, whether or not the Closing occurs, be the
property of Buyer. In the event that (I) Seller or the Company (as
applicable) completes a sale of the Closing Shares and/or the Riverboat Casino
Assets to a Person other than Buyer or its affiliate, or (II) the conditions
to Buyer's obligations are not fulfilled or waived and the sale of the Closing
Shares to Buyer has not occurred on or before August 1, 2005, in any case, for
any reason other than the breach by Buyer of its obligations under this
Agreement, then the Deposit, with interest accrued thereon, if any, shall be
immediately returned to Buyer. If (1) all conditions set forth in Section 4
hereof have been satisfied (or on the Closing Date will be satisfied) or
waived by Buyer and (2) Buyer breaches its obligation to purchase the Closing
Shares, then the Deposit (excluding interest accrued thereon, if any, which
interest shall in any event be returned to Buyer) shall be forfeited to
Seller, but without prejudice to any legal remedy for money damages Seller may
have, if any, against Buyer as a result of such breach, provided, however,
that Seller's legal remedies hereunder shall be limited exclusively to money
damages, and, provided, further, that in no event shall Seller have the right
to specific performance or any other equitable remedy against Buyer in
connection with this Agreement or the transactions contemplated hereby.
(b) Costs and Prorations.
(i) To the extent applicable, all transfer, recording or similar taxes
and fees and expenses incurred in connection with redocumentation of the
Admiral and Admiral Barge One with the United States Coast Guard shall be
borne by Seller, and Seller hereby undertakes to timely remit all such amounts
to the applicable authority and to prepare and file all proper returns and
reports with respect thereto.
(ii) All real and personal property taxes and assessments, rents, water
rates and charges, electric, gas and telephone charges and all other
apportionable operating costs and charges and expenses with respect to the
Riverboat Casino Assets will be apportioned and adjusted between Seller and
Buyer as of the Closing, provided that if the Closing will occur before the
tax rate or assessment is fixed for the year in which the Closing takes place,
the apportionment of such real and personal property taxes will be made upon
the basis of the tax rate for the preceding year applied to the latest
assessed valuation, but such apportionment will be readjusted as soon as the
applicable rate and assessment is fixed. Seller and Buyer at Closing shall
execute and deliver a closing statement reflecting their reasonable estimate
of the prorations of expenses described above in a form reasonably
satisfactory to each party. Any net proration due to Buyer will reduce the
Purchase Price, and any net proration due to Seller will increase the Purchase
Price. To the extent adjustments cannot be determined as of Closing, the
parties agree to make such post Closing adjustments (by the reduction or
increase of the Purchase Price and payment of such increase in cash to Seller,
as applicable) as are appropriate and to resolve open items within sixty (60)
days after the Closing.
(c) Cure Amounts. Seller hereby agrees that it shall be solely responsible
for all cure amounts payable under Bankruptcy Code Section 365 to the extent
necessary for the Company to assume the Assumed Executory Leases and Executory
Contracts ("Cure Amounts"). Seller at its sole option shall either pay all
such Cure Amounts in cash no later than Closing, or shall direct Buyer in
writing to pay such Cure Amounts out of the Purchase Price (with a
corresponding reduction thereof) otherwise required by this Agreement to be
paid to Seller, in which case Buyer shall pay such Cure Amounts at Closing.
(d) Determination of Surplus or Deficiency; Post-Closing Purchase Price
Adjustment.
(i) On or before the fifth (5th) Business Day preceding the Closing Date,
Seller shall prepare and deliver to Buyer an interim balance sheet (the
"Estimated Closing Balance Sheet") of Seller as of the close of business on
the final day of the calendar month immediately preceding the calendar month
during which the Closing Date occurs (the "Test Month"), together with a
statement of Seller's Net Current Assets as of such date calculated in
accordance with generally accepted accounting principles ("GAAP") and the
accounting practices of Seller applied on a consistent basis; provided that if
the Closing Date occurs within the first fifteen (15) Business Days of a
calendar month, the Estimated Closing Balance Sheet shall be prepared as of
the close of business on the final day of the second calendar month
immediately preceding the calendar month during which the Closing Date occurs
(the "Test Month"). The amount of Net Current Assets set forth in the
Estimated Closing Balance Sheet shall be final and binding for purposes of
determining the amount of any Surplus or Deficiency used in calculating the
Purchase Price, unless Buyer delivers in good faith a written statement that
Buyer objects to the calculation of Net Current Assets at least two (2)
Business Days prior to the anticipated Closing Date (the "Objection Notice")
together with Buyer's determination of the Net Current Assets as of the Test
Month. Seller shall make available to Buyer and its representatives the
books, records and workpapers used to prepare the Estimated Closing Balance
Sheet. In the event of an Objection Notice, Seller and Buyer shall negotiate
in good faith during the period preceding the Closing Date to resolve the
dispute. If the dispute is not resolved by the specified Closing Date, (A)
Buyer shall pay the Purchase Price at the Closing based upon the amount of any
Deficiency or Surplus, as applicable, calculated with reference to the Net
Current Assets as determined by Buyer, and (B) Buyer shall deposit into escrow
pursuant to the Escrow Agreement, an amount equal to the Purchase Price based
upon the amount of any Deficiency or Surplus, as applicable, calculated with
reference to the Net Current Assets set forth in the Estimated Balance Sheet
as prepared by Seller, less the amount of the Purchase Price paid by Buyer at
the Closing in accordance with clause (A) above. "Surplus" means the amount,
if any, by which Net Current Assets as determined in accordance with this
Section 2(d)(i) is a positive number and "Deficiency" means the amount, if
any, by which Net Current Assets as determined in accordance with this Section
2(d)(i) is a negative number.
(ii) As promptly as practicable after the Closing Date, but in no event
more than sixty (60) days after the Closing Date (such date on which the
Closing Balance Sheet is delivered, the "Closing Financial Statements Delivery
Date"), Buyer will prepare and deliver to Seller a balance sheet of Seller as
of the close of business on the day immediately preceding the Closing Date
(the "Closing Balance Sheet") and a calculation of Net Current Assets, each in
accordance with GAAP and the accounting practices of Seller applied on a
consistent basis. The Closing Balance Sheet and the calculation of the Net
Current Assets shall be accompanied by a certificate of an officer of Buyer to
the effect that the Closing Balance Sheet presents fairly, in accordance with
GAAP and the accounting practices of Seller applied on a consistent basis, the
financial condition of Seller as of the close of business on the day
immediately preceding the Closing Date.
(iii) Seller and its financial advisors and/or accountants (the "Seller's
Advisors") will be entitled to reasonable access during normal business hours
to the relevant records, personnel and working papers of the Buyer to aid in
their review of the Closing Balance Sheet and the calculation of Net Current
Assets therefrom. The Closing Balance Sheet and the calculation of Net
Current Assets therefrom shall be deemed to be accepted by Seller and shall be
conclusive for the purposes of the adjustment described in Section 2(d)(iv)
and (v) except to the extent, if any, that Seller or Seller's Advisors shall
have delivered, within thirty (30) days after the Closing Financial Statements
Delivery Date, a written notice to Buyer setting forth objections thereto,
specifying in reasonable detail any such objection (it being understood that
any amounts not disputed as provided herein shall be paid promptly). If a
change proposed by Seller is disputed by Buyer, then Buyer and Seller shall
negotiate in good faith to resolve such dispute. If, after a period of thirty
(30) days following the date on which Seller gives Buyer notice of any such
proposed change, any such proposed change still remains disputed, then Buyer
and Seller hereby agree that a nationally recognized accounting firm
reasonably and mutually acceptable to Buyer and Seller (the "Accounting Firm")
shall resolve any remaining disputes. The Accounting Firm shall act as an
arbitrator to make a determination with respect to the issues that are
disputed by the parties, based on presentations by Seller and Buyer, and by
independent review of the Accounting Firm if deemed necessary in the sole
discretion of the Accounting Firm, which determination shall be limited to
only those issues still in dispute. The decision of the Accounting Firm shall
be final and binding and shall be in accordance with the provisions of this
Section 2(d)(iii). The fees and expenses of the Accounting Firm, if any,
shall be shared equally by Buyer and Seller. The date on which the Net
Current Assets is finally determined pursuant to this Section 2(d)(iii) is
referred to hereinafter as the "Determination Date."
(iv) If the amount of Net Current Assets used to calculate the Purchase
Price paid at Closing pursuant to Section 2(d)(i)(A) above is greater than the
amount of Net Current Assets as determined pursuant to Section 2(d)(iii)
above, Seller shall pay to Buyer, as an adjustment to the Purchase Price, an
amount equal to such difference. Any payments required to be made by Seller
pursuant to this Section 2(d)(iv) shall be made within ten (10) days of the
Determination Date by wire transfer of immediately available funds to an
account designated by Buyer.
(v) If the amount of Net Current Assets used to calculate the Purchase
Price paid at Closing pursuant to Section 2(d)(i)(A) above is less than the
amount of Net Current Assets as determined pursuant to Section 2(d)(iii)
above, Buyer shall pay to Seller, as an adjustment to the Purchase Price, an
amount equal to such difference. Any payments required to be made by Buyer
pursuant to this Section 2(d)(v) shall be made within ten (10) days of the
Determination Date first, by payment to Seller of amounts deposited into the
Escrow Account pursuant to Section2(d)(i)(B) and then, to the extent of any
additional payment required to be made by Buyer, by wire transfer of
immediately available funds to an account designated by Buyer. Any balance
remaining in the Escrow Account after payment of amounts required to be paid
to Seller under this subsection shall be immediately returned to Buyer.
(vi) For purposes of this Section 2(d), "Net Current Assets" means the
difference between (A) the sum of (1) Included Cash, (2) Prepaid Expenses, (3)
Security Deposits, (4) Receivables, (5) fifty percent (50%) of Seller's direct
cost (including freight) of slot machines newly installed at the Riverboat
Casino within six months prior to Closing, provided such purchase and
installation is approved in advance and in writing by Buyer, and (6) seventy-
five percent (75%) of Seller's direct cost (including freight) of the Windows-
CDS software and TiTo integrated gaming system ("Tito Assets") referred to in,
and in accordance with, the Motion for Authorization to Purchase and Implement
Certain Gaming Systems and Equipment filed with the Bankruptcy Court on July
9, 2004, provided such purchase does not exceed $1,829,000 in the aggregate,
over (B) the sum of (1) Accounts Payable and (2) Accrued Expenses and Deferred
Obligations. Notwithstanding Buyer's approval of items set forth in clauses
(5) or (6) above, Buyer shall in no way become liable for the payment of any
such amounts unless and until the Closing shall have occurred, in which case
the adjustments provided for in this Section 2(d) shall apply.
3. COMPANY LIABILITIES. Buyer acknowledges that on and following the
Closing, the Riverboat Casino Assets will be subject to the following
Liabilities (the "Company Liabilities"), which obligations shall remain the
obligations of the Company:
(a) subject to Seller's obligations under Section 2(c), all of the
Company's respective obligations under the Assumed Executory Leases and
Executory Contracts (but not including obligations arising out of a Default
thereunder prior to the Closing), to the extent such obligations accrue from
and after the date of the Closing (the term "Default", as used herein, meaning
(i) a breach, default or violation, (ii) the occurrence of an event that with
or without the passage of time or the giving of notice, or both, would
constitute a breach, default or violation or cause an Encumbrance to arise, or
(iii) with respect to any Contract, the occurrence of an event that with or
without the passage of time or the giving of notice, or both, would give rise
to a right of termination, renegotiation or acceleration or a right to receive
damages or a payment of penalties);
(b) all of the Company's respective obligations with respect to accounts
payable arising on or after June 20, 2002, the Case petition date, and
existing on the Closing Date, excluding the Administrative Claims for
professional fees (the "Accounts Payable"); and
(c) (i) the accrued liability of the Company as of Closing to pay the
ultimate winnings owed to individuals playing the Company's progressive slot
machines and games primary progressive reserve, games reserve for top awards,
slots reserve for top awards (it being agreed that the progressive slot
liability shall be determined by a meter reading by Buyer and Seller at
Closing); (ii) poker progressive reserve of the Company; (iii) gift shop
certificate liability of the Company; (iv) the Company's lost and found money;
(v) the Company's customer safekeeping deposits; (vi) players club accrual (or
other outstanding complementaries) of the Company; (vii) outstanding
chips/tokens of the Company; (viii) the Company's employee benefit accruals
for holiday, vacation, personal day, sick day and severance benefits, all as
determined in accordance with good and customary gaming practice; and (ix) all
obligations of the Company with respect to other accrued expenses existing on
the Closing Date (collectively, "Accrued Expenses and Deferred Obligations").
Following the Closing, neither Buyer nor the Company will assume or otherwise
have any responsibility with respect to any other Liability of Seller or the
Company not expressly included within the definition of Company Liabilities,
including the Excluded Liabilities, provided that Buyer acknowledges it shall
have no monetary recourse against Seller with respect to any such other
Liability in accordance with the provisions of Section 14.
4. BUYER'S CONDITIONS. Buyer's obligation to purchase the Closing Shares is
expressly conditioned (unless waived by Buyer in writing) upon satisfaction of
each of the following conditions:
(a) The entry by the Bankruptcy Court of an order approving the Break-Up
Fee, the Sale Order and the Confirmation Order, as respectively defined in
Sections 9(a), (b) and (c) below, each of which shall have become a Final
Order. The Sale Order shall, among other things, authorize the sale of the
Closing Shares to Buyer free and clear of all Encumbrances. "Final Order"
means an order or judgment of the Bankruptcy Court which has not been
reversed, stayed, modified or amended, that is in full force and effect, and
as to which (i) the time to appeal or application for review by a higher court
has expired without any appeal or application for review having been filed, or
(ii) any appeal or application for review by a higher court that has been or
may be taken has resulted in entry of an order affirming the decision of the
Bankruptcy Court, with all additional review periods from that affirmance
having expired without any appeal or other application for review thereof
having been filed;
(b) The entry of such further orders as required to implement this
Agreement including a Final Order under Section 365 or 1123(b)(2) of the
Bankruptcy Code authorizing assumption by Seller and/or the Company of Assumed
Executory Leases and Executory Contracts, with specific findings that upon
payment by Seller and/or the Company of the Cure Amounts, all Defaults
required to be cured in order for the Company to assume the Assumed Executory
Leases and Executory Contracts have been cured and that the Company has
provided adequate assurance of future performance necessary to satisfy the
requirements of Section 365 of the Bankruptcy Code;
(c) Receipt by Buyer on the Closing Date on board the Riverboat Casino of
the Riverboat Casino's drawings and specifications and other technical
information in Seller or the Company's possession;
(d) The maintenance and delivery to Buyer of the original Certificates of
Documentation of the Admiral and Admiral Barge One, as applicable, to the
United States Coast Guard, National Riverboat Casino Documentation Center;
(e) The receipt on the Closing Date by Buyer of stock power or powers
executed by Seller, conveying to Buyer all of Seller's right, title and
interest in and to the Closing Shares;
(f) Seller's representations and warranties set forth in Section 6 below,
taken as a whole, shall be true and correct in all material respects on the
Closing Date (as though made then and as though the Closing Date were
substituted for the date of this Agreement), which shall be certified by an
officer of Seller as of Closing, provided that for purposes of determining
whether such representations and warranties are true and correct in all
material respects, all "materiality" qualifications contained in such
representations and warranties set forth in Section 6 shall be disregarded;
(g) Seller's representations and warranties set forth in Section 6(p) below
shall be true and correct in all respects on the Closing Date (as though made
then and as though the Closing Date were substituted for the date of this
Agreement), which shall be certified by an officer of Seller as of Closing;
(h) Intentionally omitted.
(i) Seller and the Company shall each have performed and complied in all
material respects with all obligations and covenants required to be performed
and observed by them under this Agreement prior to or as of the Closing, which
shall be certified by an officer of Seller as of Closing;
(j) The Missouri Gaming Commission (the "Commission") shall have issued
without condition all licenses, permits, approvals, consents, authorizations
and orders (which shall be Final Orders) as are required in order for Buyer to
acquire the Closing Shares and for the Company to lawfully operate the
Riverboat Casino following the Closing under the laws and regulations of the
State of Missouri, including the gaming license and liquor license described
in Schedule 6(i) (the "MGC Approval"), and the Company shall have indefeasibly
paid in full or settled all outstanding amounts owed to the Commission as set
forth on Schedule 6(l) hereof;
(k) All other necessary filings shall have been completed, waiting periods
observed and governmental approvals obtained as determined to the reasonable
satisfaction of Buyer, including Xxxx Xxxxx-Xxxxxx Anti-Trust Improvement Act
of 0000 (xxx "XXX Xxx");
(l) There shall not have occurred any material adverse change in the
business, operations, prospects or condition (financial or otherwise) of the
Company and the Riverboat Casino Assets, taken as a whole, other than any
change, event, occurrence, effect or state of facts relating to (i) any new
casino development or similar project in the St. Louis metropolitan area, (ii)
any condemnation proceeding involving, or other loss of use of, the parking
lot known as Xxxxxxxx Lot or (iii) any Excepted Environmental Conditions (a
"Material Adverse Change");
(m) The Sale Order shall contain a finding that notice of the Sale Motion
was proper and the Confirmation Order shall contain a finding that notice of
the Confirmation Order was proper;
(n) Buyer shall have received evidence, reasonably satisfactory to Buyer,
that the amount of the Company's Included Cash as of the Closing Date is not
less than $3,000,000;
(o) Seller shall have delivered a certificate of its secretary dated the
Closing Date and certifying (i) that attached thereto is a true and complete
copy of the certificate or articles of incorporation and by-laws of Seller and
the Company as in effect on the date of such certification and (ii) as to the
incumbency and specimen signature of each officer of Seller and the Company
executing this Agreement or any other document delivered in connection
herewith (such certificate to contain a certification by another officer of
Seller as to the incumbency and signature of the officer signing the
certificate referred to in this clause (n); and
(p) Buyer shall have received, at Buyer's expense, the commitment of a
title insurance company reasonably acceptable to Buyer ("Title Company") as of
the Closing Date to issue, with respect to the City Lease:
(i) an ALTA extended coverage leasehold title insurance policy in the
amount of $30,000,000 insuring leasehold title to the City Lease in the
Company, and (A) including an endorsement insuring Buyer against loss or
damage sustained by reason of the Title Company denying liability under the
new title policy by reason of knowledge imputed to the Company or Seller
through its officers and directors and other fiduciaries of company (the "Non-
Imputation Coverage"), (B) dated as of the Closing Date, and (C) subject only
to Permitted Exceptions (as defined below), or
(ii) an endorsement to any existing owner's coverage title insurance
policies insuring the Company and delivered to buyer which shall include (A)
if available, Non-Imputation Coverage, (B) updating the date of the existing
title policy to the Closing Date, and (C) insuring over any matter which is
not a Permitted Exception.
For the purposes of this Agreement, "Permitted Exceptions" means (1) liens for
real property taxes and assessments for the current year, not yet delinquent,
(2) liens or encumbrances arising out of any activity of Buyer with respect to
the City Lease, (3) except as described on Schedule 4(p), those matters listed
on Schedule B of the title report or the existing title policy, as applicable,
a copy of which has been provided to Buyer prior to the date hereof, and (4)
those matters listed on Schedule B of any new title report or title policy, as
applicable, which are approved by Buyer within 10 business days of receipt
thereof.
(q) Seller shall have delivered to Buyer a Lease and Sublease Estoppel
Certificate and Consent Agreement, in substantially the form attached hereto
as Exhibit B (with such changes thereto as Buyer shall approve, such approval
not to be unreasonably withheld or delayed), duly executed by each of the
parties thereto;
(r) Seller shall have delivered to Buyer an estoppel certificate, in
substantially the form attached hereto as Exhibit C (with such changes thereto
as Buyer shall approve, such approval not to be unreasonably withheld or
delayed), executed by each counterparty other than the Company under any
written Real Property Lease;
(s) The Main Office and the other Excluded Assets shall have been
effectively assigned and transferred to an entity other than the Company and
the Company shall no longer have any interest therein;
(t) A trademark assignment, in form and substance reasonably satisfactory
to Buyer and in a form recordable with the United Stated Patent and Trademark
Office, pursuant to which Seller shall have effectively assigned and
transferred to the Company each of the trademarks listed on Schedule 4(t),
each of which shall be deemed to be included in the Riverboat Casino Assets;
(u) Buyer shall have received a written analysis prepared by Seller as of a
date which is not more than 30 business days prior to the Closing Date,
together with copies of all supporting work papers thereto and other
information as may be reasonably requested by Buyer (the "Liquidation
Analysis"), as to the effect, upon the consolidated net operating loss
properly attributable to the Company, of income of Seller's consolidated group
(including income with respect to excess loss accounts required to be taken
into account under Treasury Regulations Section 1.1502-19) and the discharge
of all indebtedness and other obligations of Seller and all members of
Seller's consolidated group in connection with a final liquidation of Seller
and all such members of Seller's consolidated group (and assuming, for
purposes of such analysis, that all existing indebtedness and other
obligations of Seller and all members of Seller's consolidated group as of
immediately prior to the Closing Date hereunder were discharged in a final
liquidation occurring as of the Closing Date, with reasonable assumptions
being made with respect to the value of any assets of Seller and the members
of its consolidated group, and including the cash Purchase Price to be paid by
Buyer under this Agreement) (the "Assumed Final Liquidation"), and the
Liquidation Analysis shall demonstrate, to the reasonable satisfaction of
Buyer, that the consolidated net operating loss properly attributable to the
Company will not be diminished to an amount less than $30,000,000 as a result
of the Assumed Final Liquidation, provided that Buyer acknowledges that any
discharge of indebtedness of the Company to any other member of Seller's
consolidated group will not be deemed to diminish such net operating loss for
purposes of this subsection. If Buyer and Seller are unable to agree upon the
Liquidation Analysis, the Assumed Final Liquidation or any assumption or other
aspect thereof, any such disputed matter shall be resolved by a nationally
recognized accounting firm reasonably and mutually acceptable to Buyer and
Seller.
5. SELLER'S CONDITIONS. Seller's obligation to sell the Closing Shares to
Buyer is expressly conditioned (unless waived by Seller in writing) upon
satisfaction of each of the following conditions:
(a) The (i) payment of the Purchase Price (less the Deposit (with interest
accrued thereon, if any)) by wire transfer from Buyer and (ii) the receipt of
the Deposit (with interest accrued thereon, if any) from the Escrow Agent;
(b) The receipt of copies (certified by the secretary of Buyer) of the
resolutions of Buyer's board or other documentation authorizing the execution,
delivery and performance of this Agreement and the transactions and documents
contemplated herein;
(c) The entry by the Bankruptcy Court of the Sale Order and the
Confirmation Order;
(d) Buyer's representations and warranties in Section 7 below, taken as a
whole, shall be true and correct in all material respects on the Closing Date
(as though made then and as though the Closing Date were substituted for the
date of this Agreement), which shall be certified by an officer of Buyer as of
Closing, provided that for purposes of determining whether such
representations and warranties are true and correct in all material respects,
all "materiality" and "in all material respects" qualifications contained in
such representations and warranties set forth in Section 7 shall be
disregarded;
(e) Buyer shall have performed and complied in all material respects with
all obligations and covenants required to be performed and observed by Buyer
under this Agreement prior to or as of the Closing, which shall be certified
by an officer of Buyer as of closing;
(f) The MGC Approval shall have been obtained; and
(g) All other necessary filings shall have been completed, waiting periods
observed and governmental approvals obtained as determined to the reasonable
satisfaction of Seller, including the HSR Act.
6. SELLER'S REPRESENTATIONS. Seller hereby represents and warrants to Buyer
that the following statements contained in this Section 6 are correct and
complete as of the date of this Agreement:
(a) Seller has and on the Closing Date will have (in each case, subject to
liens and claims to be discharged upon the issuance of the Sale Order) good
and lawful title to and possession of the Closing Shares, free and clear of
all Encumbrances. The Company has and on the Closing Date will have (in each
case, subject to liens and claims to be discharged upon the issuance of the
Confirmation Order) good and lawful title to and possession of the Riverboat
Casino Assets, free and clear of all claims and interests of creditors of the
Company (to the maximum extent permitted under Section 1141(c) of the
Bankruptcy Code), other than the Company Liabilities.
(b) Provided the Sale Order and the Confirmation Order are issued by the
Bankruptcy Court and subject to the other terms and conditions of this
Agreement, the Riverboat Casino and the other Riverboat Casino Assets shall be
owned by the Company following the Closing Date free and clear of all claims
and interests of creditors of the Company other than the Company Liabilities.
Provided the Sale Order and the Confirmation Order are issued by the
Bankruptcy Court, the Closing Shares shall be owned by Buyer following the
Closing Date free and clear of all Encumbrances. Except for certain items
located in the Main Office that are listed on Schedule 6(b), all of the
tangible personal property of the Company that is necessary for the operation
of the Riverboat Casino in the same manner as presently operated by the
Company immediately prior to Closing is physically located at the Riverboat
Casino or at the properties covered by the Assumed Executory Leases and
Executory Contracts. Except as set forth in Schedule 6(b), all tangible
personal property included in the Riverboat Casino Assets are suitable for the
purposes for which they are used, in good working condition, reasonable wear
and tear excepted, and are free from any known defects. The Hull
Certification attached to Schedule 6(b) hereto is true and correct and is in
full force and effect.
(c) The Company is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it was incorporated
and is qualified to do business as a foreign corporation in each jurisdiction
where it is required to be qualified to avoid liability or disadvantage.
Seller has all requisite corporate power and authority necessary to execute
and deliver this Agreement, sell the Closing Shares and otherwise perform its
obligations under this Agreement and any documents related thereto, subject
only to the issuance of the Sale Order by the Bankruptcy Court. Subject to
the issuance of the Sale Order and the Confirmation Order, this Agreement and
any related document executed and delivered by Seller and/or the Company (as
applicable) has been, or will be, duly executed and delivered by Seller and/or
the Company (as applicable) and constitutes, or, when executed will
constitute, a valid and binding obligation of Seller and/or Company,
enforceable against Seller and/or Company in accordance with its terms,
subject only to the issuance of the Sale Order by the Bankruptcy Court.
(d) Attached to this Agreement as Schedule 6(d) are the audited balance
sheets of the Company as of February 28, 2002 and 2003 and February 29, 2004,
and the related unaudited statements of operations and cash flows for the
years then ended (the "Annual Financial Statements"), and the unaudited
balance sheet of Company as of June 30, 2004 (the "Balance Sheet") and the
related statement of operations for the three months then ended (the "Interim
Financial Statements", and together with the Annual Financial Statements, the
"Financial Statements"). The date of the Balance Sheet is referred to herein
as the "Balance Sheet Date." The Financial Statements are, and the Post-
Signing Financial Statements (as defined below) will be true, correct and
complete and fairly present in all material respects the financial position of
the Company as of the dates shown and the results of the Company's operations
for the periods covered thereby. The Financial Statements have been prepared
in accordance with GAAP applied on a consistent basis, except that the
Financial Statements lack full footnote disclosures and the Interim Financial
Statements are subject to year end adjustment consistent with prior periods.
(e) Schedule 6(e) attached to this Agreement sets forth a list of all real
property used by the Company in connection with its ownership and operation of
the Riverboat Casino. Except for the Real Property Leases identified on
Schedule 6(e), for easement rights which are shown on the title policy as
appurtenant to the City Lease and for public rights of way, the lawful
operation or occupancy of the Riverboat Casino does not require use of any
other real property, for parking, access, support or any other purpose, and no
other real property is now being used in conjunction with the operation or
occupancy of the Riverboat Casino. Except for Real Property Leases identified
on Schedule 6(e), the Company does not own, lease, license, hold or use any
other land, buildings or other interest, including any option, in real
property. A true and complete copy of each written Real Property Lease
identified on Schedule 6(e) has been delivered to Buyer, including all
amendments or modifications thereto and any other agreements related thereto
such as options, rights of first offer or rights of first refusal to purchase
the leased premises or any portion thereof. Each oral Real Property Lease has
been described in reasonable detail on Schedule 6(e). Each of the Real
Property Leases is in full force and effect and no claim of Default by either
tenant or landlord thereunder has been made. The description of the leased
premises in each Real Property Lease describes the real property being used
thereunder fully and adequately. The Company has not received written
notice of any condemnation proceedings by any public authority relating to any
of the real property leased by the Company, except for any condemnation
proceeding involving the parking lot known as Xxxxxxxx Lot (a "Xxxxxxxx
Proceeding"), and, to Seller's Knowledge, none are pending. The Riverboat
Casino has adequate water supply, sanitary facilities, telephone, gas,
electricity and fire protection services and other public utilities sufficient
to operate the Riverboat Casino as it is presently operated. Except as set
forth on Schedule 6(e), the Company has the exclusive right to occupy the real
property leased pursuant to the Real Property Leases identified on Schedule
6(e) and the Company has not granted any leases, subleases, licenses,
concessions, options, or other agreements, written or oral, to any third party
granting the right to use or occupy said real property.
(f) Except as described on Schedule 6(f) and except with respect to the
Excluded Assets, the business of the Riverboat Casino has been conducted in
the ordinary course since the Balance Sheet Date, and there has not been with
respect to the Company any of the items specified below since the Balance
Sheet Date:
(i) any increase in the compensation payable or to become payable to any
director, officer, employee or agent of the Company, except for increases for
non-officer employees made in the ordinary course of business or as otherwise
consented to in writing by Buyer, nor any other change in any employment or
consulting arrangement;
(ii) any sale, assignment or transfer of any Riverboat Casino Assets, or
any additions to or transactions involving any Riverboat Casino Assets, other
than those made in the ordinary course of business or as otherwise consented
to in writing by Buyer;
(iii) other than in the ordinary course of business or pursuant to the
Company Plan of Reorganization, any waiver or release of any claim or right or
cancellation of any debt held (other than Excluded Liabilities);
(iv) any damage, destruction or loss, whether or not covered by
insurance, (A) materially and adversely affecting the Riverboat Casino Assets
or the operations, assets, properties or prospects of the Riverboat Casino
Assets or (B) of any item or items carried on its books of account
individually or in the aggregate at more than $100,000, or any material
repeated, recurring or prolonged shortage, cessation or interruption of
supplies or utility or other services required to operate the Riverboat Casino
Assets; and
(v) receipt of notice or actual or threatened labor trouble, strike or
other occurrence, event or condition of any similar character which has had or
would reasonably be expected to materially and adversely affect the Riverboat
Casino Assets or the transactions contemplated by this Agreement or any other
document delivered in connection herewith.
(g) Schedule 6(g) attached to this Agreement contains a complete and
accurate list and summary description of all registered Intellectual Property
owned by the Company or its affiliates. All copyrights, trademarks and
service marks that have been registered are currently in compliance with all
formal legal requirements (including the timely post-registration filing of
affidavits of use and incontestability and renewal applications), are valid
and enforceable, and are not subject to any maintenance fees or taxes or
Actions falling due within 90 days after the Closing Date. No such copyright,
trademark or service xxxx has been or is now involved in any interference,
reissue, reexamination, or opposition proceeding. To Seller's Knowledge, none
of the Registered Intellectual Property of the Company infringes, or has been
alleged to infringe, any copyright, trademark, service xxxx or other
proprietary right of any other Person.
(h) Schedule 6(h) sets forth a list or description of each written or oral
contract, agreement, lease, instrument, or other document or commitment,
arrangement, undertaking, practice or authorization material to the business
of the Company and that is binding upon the Company or its property under any
applicable Law ("Contracts"), including Contracts of the type described below:
(i) employment agreements; collective bargaining agreements,
multiemployer plan adoption agreements and other agreements affecting any
union employee of the Company; and deferred compensation agreements,
relocation agreements and other agreements affecting any nonunion employee of
the Company;
(ii) leases of any tangible personal property, including gaming
equipment, food service machinery and equipment, and office, printing or
computer equipment;
(iii) license agreements (other than the Gaming Licenses), whether as
licensor or licensee (excluding licenses from third parties implied by the
sale of a product and paid up licenses for commonly available shrink wrap
software applications);
(iv) joint venture agreements, affiliation and endorsement agreements,
advertising agreements with minimum purchase provisions or other undertakings
which have not yet been satisfied by the Company, and public relations
Contracts;
(v) Contracts by which any material product or service offered by the
Company or any material operating function of the Company (including gaming,
food service, personnel and security) have been outsourced to a third party;
(vi) any guarantee or other pledging of the Company's credit or financial
resources for the obligations of officers, directors, employees or affiliates
of the Company or any other Person;
(vii) any Contract that has been entered into outside of the ordinary
course of the Company's business;
(viii) any other Contract which is material to the Company or to the
operation of the Riverboat Casino; and
(ix) any Contract to pay brokerage commissions or parking operation or
facilities fees with respect to the Real Property Leases.
Seller has delivered or made available to Buyer true and complete copies of
each Contract, all of which are in force and effect and may be assumed by the
Company subject to this Agreement or Buyer's consent, as applicable, provided
the Sale Order and Confirmation Order is obtained.
(i) Schedule 6(i) attached to this Agreement sets forth a list of all
Gaming Licenses of the Company. Other than Gaming Licenses listed on Schedule
6(i), no other Gaming License or other governmental permit, license,
registration, certificate of occupancy, approval and other governmental
authorization is required for the complete operation of the Riverboat Casino
Assets as currently operated. All Gaming Licenses listed on Schedule 6(i) are
in full force and effect, and neither the Company nor Seller (as applicable)
is in Default thereunder. Complete and correct copies of all of the Gaming
Licenses have heretofore been delivered or made available to Buyer by Seller.
(j) Except as set forth in Schedule 6(j) and other than the Case, there is
not pending or, to Seller's Knowledge, threatened any suit, Action,
arbitration or legal, administrative or other proceeding by or against or
affecting Seller, the Company or any of the Riverboat Casino Assets other than
any Xxxxxxxx Proceeding and, to Seller's Knowledge, no basis exists therefor,
and there are no suits, Actions or proceedings pending in which the Company is
the plaintiff or claimant with respect to the Riverboat Casino Assets. Except
as set forth in Schedule 6(j) or as contemplated by this Agreement, the Break-
Up Fee Order, the Confirmation Order and the Company Plan of Reorganization,
neither Seller, the Company nor any of the Riverboat Casino Assets is subject
to any order, writ, injunction or decree of any federal, state, local or
foreign court, department, agency or instrumentality or any award in any
arbitration proceeding ("Court Orders"). Neither Seller nor the Company is in
Default with respect to any Court Orders. There is no Action, suit or
proceeding pending or, to Seller's Knowledge, threatened which questions the
legality or propriety of the transactions contemplated hereby.
(k) Schedule 6(k) lists the names, addresses, dates of hire, positions and
current annual compensation rates of all of the Company's employees and
officers as of the date indicated therein. The Company has paid in full to
all employees and officers, as and when such amounts have become due, or made
appropriate accruals therefor on its books of account, all salary, wages,
commissions, bonuses and other direct compensation for all services performed
by them. The Company has withheld or collected from each payment made to each
of its employees the amount of all taxes required to be withheld or collected
therefrom, and the Company has paid the same when due to the proper
authorities. Except as disclosed in Schedule 6(k), there are no controversies,
grievances or claims pending with the Company by any of the Company's
employees, former employees or beneficiaries of employees of the Company with
respect to their employment or benefits incident thereto, including sexual
harassment and discrimination claims and claims arising under workers'
compensation laws which have not been resolved and, to Seller's Knowledge, no
basis exists therefor. Except as listed in Schedule 6(k), there is no union
representation of the Company's employees, and, to Seller's Knowledge, there
has been no attempt by a labor organization to organize the Company's
employees into a collective bargaining unit.
(l) Except as described in Schedule 6(l), there has been no material
Default by the Company under any statute, law, ordinance, regulation, order or
rule of any federal, state, local or foreign government or any court or
tribunal of competent jurisdiction, administrative agency, department,
commission, instrumentality, body or other governmental authority or
instrumentality, domestic or foreign (each, a "Governmental Authority") that
have not previously been cured or for which all consequences of noncompliance
have already occurred and neither Seller nor the Company has received any
notices from any Governmental Authority regarding any alleged material
Defaults applicable to Seller, the Company or any Riverboat Casino Assets
under any Applicable Laws.
(m) Except as set forth in Schedule 6(m), the Company is not a party to,
nor has the Company established, any pension, profit-sharing, cafeteria,
medical reimbursement, 401(k), retirement, deferred compensation, stock
option, incentive, vacation, hospitalization, medical, disability or life
insurance, severance, termination, bonus or other employee benefit plan,
contract, arrangement or understanding of the Company or any Person required
to be aggregated with, or treated as the same employer as the Company under
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), or
the Internal Revenue Code of 1986, as amended ("Code") (collectively
hereinafter referred to as an "ERISA Affiliate"), whether or not covered by
ERISA or qualified within the meaning of Section 401(a) of the Code, and
whether single-employer or multi- employer, which is presently in force or
which has been terminated within the six calendar year period prior to this
year. The employee benefit and welfare plans set forth in Schedule 6(m) do not
qualify for the special provisions for multi-employer plans set forth in 29
U.S.C. Section 1384 and this Agreement does not invoke a complete or partial
withdrawal as contemplated by 29 U.S.C. Section 1384, or the attenuating
penalties and liabilities to Buyer as set forth therein.
(n) Except as described in Schedule 6(n), neither the execution and
delivery by Seller of this Agreement, nor the performance of the transactions
performed or to be performed by Seller and/or the Company hereunder, (i)
require any filing, consent, notice, registration, renegotiation or approval
of any third party (including any Governmental Authority) or any customer,
supplier, landlord, licensor or union or (ii) violate in any material respect
or constitute a Default in any material respect, or cause any payment
obligation or Encumbrance to arise under (A) any laws of any Governmental
Authority, including all federal, state and local statutes, regulations,
ordinances, orders, decrees or any other laws, common law theories or reported
decisions of any court thereof ("Applicable Law") or Court Order to which
Seller or the Company is subject (other than any approvals or orders of the
Bankruptcy Court or any consent required under the HSR Act), (B) the
certificate or articles of incorporation or bylaws of Seller or the Company,
or (C) any Contract, Gaming License or other document to which Seller or the
Company is a party or by which the Riverboat Casino Assets may be bound.
(o) The Company has authorized (i) 1,000 shares of Company Common Stock of
which 1,000 shares are issued and outstanding (the "Closing Shares"), all of
which are owned of record by Seller. Other than the Closing Shares, there
are no other equity securities, options, warrants, convertible securities,
Contracts or rights of any kind to purchase or otherwise acquire any equity
securities of the Company. No shares of the capital stock of the Company are
held as treasury stock. All of the Closing Shares have been duly authorized
and validly issued, are fully paid and non-assessable, were not issued in
violation of the terms of any Contract binding upon the Company or, to
Seller's Knowledge, any holder thereof and were issued in compliance with the
certificate or articles of incorporation and bylaws of the Company and all
applicable federal, state and foreign securities laws, rules and regulations.
There are no Contracts to which Seller or the Company is a party among any
Persons which (i) affect or relate to the voting or giving of written consents
with respect to any security, or (ii) restrict the transfer of the Closing
Shares.
(p) Other than those specific facts, conditions and circumstances disclosed
in the Phase I environmental assessment performed by Buyer in August 2004 with
respect to the real property (including the Casino) owned by the Company or
otherwise used in the operation of the Riverboat Casino Assets (the "Excepted
Environmental Conditions"), there are no material Environmental Conditions (i)
at any premises at which the Riverboat Casino Assets have been operated by the
Company, its affiliates or their predecessors, (ii) at any property owned,
leased or operated at any time by the Company, any Person controlled by the
Company or any of their predecessors, or (iii) at any property at which
Hazardous Substances have been deposited or disposed of by or at the behest or
direction of any of the foregoing. "Environmental Condition" means any
condition or circumstance, including a Release or the presence of Hazardous
Substances, whether created by Seller, the Company or any third party, at or
relating to any such property or premises specified in any of clauses (i)
through (iii) of this Section that (A) has required or may reasonably be
expected to require abatement or correction under an Environmental Law, (B)
has given or may reasonably be expected to give rise to any civil or criminal
liability on the part of the Company to any Governmental Authority or third
party under an Environmental Law, (C) is a violation of Environmental Law, or
(D) has created or may reasonably be expected to create a public or private
nuisance. "Environmental Law" means any and all Laws, Court Orders and
Governmental Permits relating to the protection of health, safety or the
environment, worker health and safety, and/or governing the handling, use,
generation, treatment, storage, transportation, disposal, manufacture,
distribution, formulation, packaging, labeling, or Release of Hazardous
Substances whether now existing or subsequently amended or enacted and the
regulations promulgated thereunder, all amended or superseded from time to
time; and any common law doctrine, including negligence, nuisance, trespass,
personal injury, or property damage related to or arising out of the presence,
Release, or exposure to a Hazardous Substance. "Hazardous Substances" means
petroleum, petroleum hydrocarbons or petroleum products, petroleum by-
products, radioactive materials, asbestos or asbestos containing materials,
gasoline, diesel fuel, pesticides, radon, urea formaldehyde, lead or lead
containing materials, polychlorinated biphenyls; and any other chemicals,
materials, substances or wastes in any amount or concentration which are now
or hereafter become defined as or included in the definition of "hazardous
substances," "hazardous materials," "hazardous wastes," "extremely hazardous
wastes," "restricted hazardous wastes," "toxic substances," "toxic
pollutants," "pollutants," "regulated substances," "solid wastes," or
"contaminants" or words of similar import, under any Environmental Law.
"Release" means any release, spill, emission, leaching, leaking, pumping,
injection, deposit, disposal, discharge, dispersal, or leaching into the
indoor or outdoor environment, or into or out of any property.
(q) Taxes.
(i) The Company has filed (or there has been filed on its behalf) all Tax
Returns that were required to be filed with respect to the Company (including
Tax Returns of any consolidated, affiliated, combined, unitary or similar
group of which the Company is or was a member to the extent the Company would
be liable for any Taxes imposed on the Company or any other such member under
Treasury Regulation Section 1.1502-6 or corresponding provisions of state,
local or foreign law or as a transferee or successor, by contract or
otherwise) under applicable laws and regulations. All such Tax Returns were
correct and complete in all material respects and were prepared in substantial
compliance with all applicable laws and regulations. All Taxes due and owing
by the Company, or of any consolidated, affiliated, combined, unitary or
similar group of which the Company is or was a member (whether or not shown on
any Tax Return) to the extent the Company would be liable for any Taxes
imposed on the Company or any other such member under Treasury Regulation
Section 1.1502-6 or corresponding provisions of state, local or foreign law or
as a transferee or successor, by contract or otherwise, have been paid.
Except as described in Schedule 6(q), the Company is not currently the
beneficiary of any extension of time within which to file any Tax Return. As
used herein, "Taxes" means all taxes, duties, charges, fees, levies or other
assessments imposed by any taxing authority including income, gross receipts,
value-added, excise, withholding, personal property, real estate, sale, use,
ad valorem, license, lease, service, severance, stamp, transfer, payroll,
employment, customs, duties, alternative, add-on minimum, estimated and
franchise taxes (including any interest, penalties or additions attributable
to or imposed on or with respect to any such assessment).
(ii) The Company was properly includible in Seller's consolidated federal
income tax returns for all open tax periods prior to and including the Closing
Date.
(iii) Neither Seller nor the Company has undergone a Code Section 382
change in ownership; provided, however, in the event that any portion of the
consolidated net operating loss carryforward allocable to the Company under
Treasury Regulations Section 1.1502-21(b) is determined to be subject to a
consolidated or subgroup 382 limitation, Seller shall elect in accordance with
Treasury Regulations Section 1.1502-95(c) to apportion to the Company a
portion of the consolidated Section 382 limitation sufficient to permit the
Company to absorb the apportioned consolidated net operating loss carryforward
that is otherwise available to the Company and its new consolidated group; and
provided, further, that Seller makes no representation as to the effects of
the transactions contemplated by this Agreement.
(iv) No claim has ever been made by an authority in a jurisdiction where
the Company does not file Tax Returns that the Company is or may be subject to
taxation by that jurisdiction. There are no Liens for Taxes (other than Taxes
not yet due and payable) upon any of the assets of the Company.
(v) Except as described in Schedule 6(q), no foreign, federal, state, or
local tax audits or administrative or judicial Tax proceedings are pending or
being conducted with respect to the Company (including with respect to any
consolidated, affiliated, combined, unitary or similar group of which the
Company is or was a member to the extent the Company would be liable for any
Taxes imposed on the Company or any other such member under Treasury
Regulation Section 1.1502-6 or corresponding provisions of state, local or
foreign law or as a transferee or successor, by contract or otherwise).
Seller shall remit any refund of Taxes received by Seller to the extent such
refund is attributable to the Company or its business (including any refund
that may result from Tax proceedings as described in Schedule 6(q)), but
excluding any tax refunds described in Section 9(c)(vii)(11). Except as
described in Schedule 6(q), neither Seller, to the extent attributable to the
Company, nor the Company has received from any foreign, federal, state, or
local taxing authority (including jurisdictions where the Company has not
filed Tax Returns) any (A) notice indicating an intent to open an audit or
other review, (B) request for information related to Tax matters, or (C)
notice of deficiency or proposed adjustment for any amount of Tax proposed,
asserted, or assessed by any taxing authority against the Company.
(vi) Neither Seller, to the extent attributable to the Company, the
Company nor any of their respective subsidiaries has waived any statute of
limitations in respect of Taxes or agreed to any extension of time with
respect to a Tax assessment or deficiency.
(vii) Neither Seller nor the Company are foreign persons and are "United
States Persons" as defined in Code Section 7701(a)(3).
(viii) The Company will not be required to include any item of income in,
or exclude any item of deduction from, taxable income for any taxable period
(or portion thereof) ending after the Closing Date as a result of any:
(A) change in method of accounting for a taxable period ending on or
prior to the Closing Date;
(B) "closing agreement" as described in Code Section 7121 (or any
corresponding or similar provision of state, local or foreign income Tax law)
executed on or prior to the Closing Date;
(C) installment sale or open transaction disposition made on or prior
to the Closing Date; or
(D) prepaid amount received on or prior to the Closing Date.
(ix) Seller will not treat the stock of the Company as worthless under
Code Section 165.
(x) Seller will not elect, on behalf of the Company, to reduce the basis
of the depreciable property of the Company under Code Section 108(b)(5).
(r) The Company does not have any direct or indirect liability,
indebtedness, obligation, commitment, expense, claim, deficiency, guaranty or
endorsement of or by any Person, whether accrued, absolute, contingent,
matured, unmatured, liquidated, unliquidated, known or unknown ("Liability")
except for (i) Liabilities which are adequately reflected and reserved against
in the Balance Sheet, and (ii) Liabilities arising under the Company
Contracts, provided that none of the Liabilities described in this Section
relates to any Default, breach of warranty, tort, infringement or violation of
Law or arose out of any action, order writ, injunction, judgment or decree
outstanding or claim, suit, litigation, proceeding, investigation or dispute
("Action").
Other than the representations and warranties contained in this Agreement,
Seller makes no representation or warranty as to the seaworthiness of the
Riverboat Casino or the condition or fitness of the Riverboat Casino or any of
the other Riverboat Casino Assets thereof for any particular purpose other
than the purpose for which they are currently used. For purposes of this
Agreement, "Seller's Knowledge" means the actual knowledge of any of its
executive officers as of the date of this Agreement, after reasonable inquiry.
7. BUYER'S REPRESENTATIONS. As of the date hereof and as of the Closing,
Buyer hereby represents and warrants to Seller that (a) Buyer is a corporation
duly formed, validly existing and in good standing under the laws of the
jurisdiction identified in the preamble to this Agreement and is in good
standing under the laws of the Commonwealth of Pennsylvania, (b) Buyer has all
requisite power and authority necessary to enter into this Agreement and to
carry out its obligations hereunder, (c) Buyer is a citizen of the United
States within the meaning of 46 U.S.C. Section 2, authorized to own and
operate the Riverboat Casino in the coastwise trade, (d) Buyer has had full
opportunity to inspect the Riverboat Casino, its various components and
systems and the other Riverboat Casino Assets, and Buyer is relying solely on
the representations and warranties made by Seller herein and its own
evaluation of the seaworthiness of the Riverboat Casino and the condition and
fitness of the other Riverboat Casino Assets in connection with its agreement
to purchase the Riverboat Casino Assets, (e) all documents and information
furnished by Buyer to Seller with respect to Buyer's financial condition,
sources of financing and capability of operating a gaming establishment are
true and correct in all material respects, (f) other than the MGC Approval and
any filings required to be made under the HSR Act, no consent, approval or
action of, filing with or notice to any governmental or regulatory authority
or other third party on the part of Buyer is required in connection with the
(i) execution, delivery and performance of this Agreement or (ii) consummation
of the transactions contemplated hereby, (g) the execution and delivery by
Buyer of this Agreement and the performance by Buyer of its obligations
hereunder do not (i) conflict with or result in a violation or breach of any
of the terms, conditions or provisions of the certificate of incorporation or
By-laws of Buyer or (ii) conflict with or result in a violation or breach of
any term or provision of any law or order applicable to Buyer or any of its
assets and properties, other than such conflicts, violations or breaches that
could not in the aggregate reasonably be expected to adversely affect the
validity or enforceability of this Agreement and (h) Buyer has sufficient cash
and/or available credit facilities (and has provided Seller with evidence
thereof) to pay the Purchase Price and to make all other necessary payments of
fees and expenses in connection with the transactions contemplated by this
Agreement, including in respect of the Company Liabilities.
8. COVENANTS.
(a) Pre-Closing Covenants of Seller. Seller hereby covenants and agrees
that prior to the Closing Date it shall (and shall cause the Company, as
applicable, to):
(i) make available to Buyer's representatives true and correct originals
or copies of all records relating to the construction and operation of the
Riverboat Casino which are in Seller's or the Company's possession (with Buyer
to bear the cost of any copying costs) including drawings and specifications;
(ii) cause the Riverboat Casino to be insured through and including the
Closing Date with the same coverages, limits, policies and underwriters as in
effect on the date hereof;
(iii) use all commercially reasonable efforts to cause those conditions
to the Closing which are reasonably within Seller's and/or the Company's
control to be timely satisfied;
(iv) (A) not amend, modify, terminate (partially or completely), grant
any waiver under or give any consent with respect to any Contract that is an
Assumed Executory Lease and Executory Contract; (B) not materially Default
under any Contract that is an Assumed Executory Lease and Executory Contract,
provided, that if such Default is cured prior to the Closing, Seller shall not
have breached this clause (B); (C) not create any Encumbrance on any of the
Riverboat Casino Assets other than the Company Liabilities or pursuant to this
Agreement or otherwise in the ordinary course of business; (D) not compromise,
settle or otherwise adjust any Assumed Liability; (E) not alter the salaries
or other compensation payable to any employee in any material respect, other
than in the ordinary course of business with respect to employees with
salaries and bonuses of less than $50,000 and other than with respect to new
employees hired in the ordinary course of business; or (F) not fail to take
any reasonable action within its control as a result of which any of the
changes or events listed in Section 6(f) would be likely to occur, in each
case other than pursuant to the Company Plan of Reorganization and this
Agreement and other than in respect of claims not being assumed by the
Company;
(v) deliver to Buyer within 15 days after the end of each calendar month
unaudited financial statements the Company for such month, consisting of a
balance sheet, a statement of income (including detailed revenue
classifications) and a statement of cash flows (all such financial
statements, the "Post-Signing Financial Statements");
(vi) give Buyer and its representatives (including Buyer's accountants,
counsel, consultants, employees and such other representatives as Buyer may
designate from time to time), upon reasonable notice and during normal
business hours, full access to the Riverboat Casino Assets, and all Contracts,
books, records and affairs of Seller and the Company related to the Riverboat
Casino Assets, and Seller shall cause its officers and employees to furnish to
Buyer copies of all documents, records and information related to the
Riverboat Casino Assets as Buyer or its representatives may reasonably
request;
(vii) [intentionally omitted];
(viii) subject to the restrictions set forth in this Agreement, use
commercially reasonable efforts (A) to operate the Riverboat Casino in the
ordinary course of business consistent with Seller's and the Company's
practices during and prior to the period following the filing of its
bankruptcy petition, and (B) as necessary to cause the representations and
warranties of Seller in Section 6 to be true and correct in all material
respects as of the Closing Date;
(ix) notify Buyer, in writing, prior to implementing operational
decisions of a material nature outside the ordinary course of business and
obtain Buyer's written consent prior to entering into any Contract involving
an amount in excess of $75,000;
(x) not take a position (or cause the Company to take a position) on any
income tax return, before any governmental agency charged with the collection
of any income tax, or in any judicial proceeding that is in any way
inconsistent with the allocation of the Purchase Price as agreed to by Seller
and Buyer at or prior to the Auction (as defined in Section 9(a) below);
(xi) subject to the restrictions set forth in this Agreement, use (or
cause the Company to use) commercially reasonable efforts (but shall not be
required to increase wages or benefits) to keep available the services of the
current employees and agents of Seller and the Company and to maintain its
relations and goodwill with the suppliers, customers, distributors of Seller
or the Company and any others having a business relation with Seller or the
Company;
(xii) obtain Buyer's consent, in writing, prior to modifying or
terminating any Real Property Lease or abandoning any real property covered by
a Real Property Lease, which consent Buyer may grant or withhold in its sole
and absolute discretion;
(xiii) promptly disclose to Buyer in writing any information set forth in
the Schedules that is no longer complete, true or applicable and any
information of the nature of that set forth in the Schedules that arises after
the date hereof and that would have been required to be included in the
Schedules if such information had been obtained on the date of delivery
thereof; provided, however, that none of such disclosures shall be deemed to
modify, amend or supplement the representations and warranties of Seller or
the Schedules hereto for the purposes of this Agreement (including Section 4
and Section 12 hereof) unless Buyer shall have consented thereto in writing;
(xiv)not treat the stock of the Company as worthless under Code Section 165;
and
(xv) not elect, on behalf of the Company, to reduce the basis of the
depreciable property of the Company under Code Section 108(b)(5).
Provided, however, notwithstanding anything to the contrary herein, the
Company may, at any time and from time to time, distribute, dividend,
transfer, assign or otherwise dispose of any or all of the Excluded Assets;
provided, further, that, notwithstanding any other provision in this
Agreement, so long as the Company Plan of Reorganization is prepared and
prosecuted in good faith, the failure of the Company Plan of Reorganization to
be confirmed by the Bankruptcy Court shall not constitute a breach by Seller
of any covenant herein; and provided, further, that, notwithstanding any
other provision in this Agreement, nothing in this Agreement shall be deemed
to restrict or prohibit either the Company or the Committee from including
provisions in the Company Plan of Reorganization (including provisions
regarding the treatment of creditors) that either the Company or the Committee
deem to be appropriate or in furtherance of its fiduciary duties, so long as
nothing so included in the Company Plan of Reorganization is inconsistent with
the provisions of this Agreement.
(b) Post-Closing Covenant of Seller. Seller further covenants that (i) for
a period of thirty (30) days from and after the Closing Date, Seller shall
permit Buyer and its authorized representatives to have access to the Main
Office for purposes of removing the items stored or located therein that are
included in the Riverboat Casino Assets, as set forth on Schedule 6(b); (ii)
Seller will not treat the stock of the Company as worthless under Code Section
165; (iii) Seller will not elect, on behalf of the Company, to reduce the
basis of the depreciable property of the Company under Code Section 108(b)(5),
and (iv) Seller shall apportion the consolidated Section 382 limitation to
Buyer under the circumstances and in the manner described in Section
6(q)(iii). To the extent employees of Seller or the Company are owed salary,
wages or other benefits in connection with services rendered to Seller and/or
the Company through the Closing Date (excluding accrued vacation pay), Seller
and/or the Company (as applicable) shall pay all such amounts to its employees
on a timely basis after the Closing in accordance with Seller's regular
payroll procedures. Buyer acknowledges and agrees that, notwithstanding
anything to the contrary in this Agreement, following the Closing, (x) Seller
and/or any entity other than the Company that will be responsible under the
Company Plan of Reorganization for distributing assets on or after the
effective date of the Company Plan of Reorganization to creditor classes may,
at any time and from time to time, distribute, pay-out, dividend, assign or
otherwise dispose of any of their respective assets, including without
limitation the Excluded Assets and the Purchase Price (collectively,
"Distributions"), to their respective creditors, provided, however, that this
provision shall in no event apply to the Company or be deemed to authorize the
distribution of any assets owned by the Company following the Closing.
(c) Covenants of Buyer.
(i) Buyer hereby covenants and agrees that it shall (A) use all
commercially reasonable efforts to cause those conditions to the Closing which
are reasonably within Buyer's control to be timely satisfied, and (B) use all
commercially reasonable efforts to cause the representations and warranties of
Seller in Section 6 to be true and correct in all material respects as of the
Closing Date.
(ii) From the Closing Date until the date on which the Case is closed and
at Seller's expense, Buyer shall permit Seller and its authorized
representatives, upon reasonable notice to Buyer and at a time convenient to
Buyer, to have access to the books and records of Seller and the Company being
transferred to Buyer as part of the Riverboat Casino Assets, for the purpose
of obtaining any information necessary for the preparation and filing of any
tax returns or other reports to any governmental authority for any period or
for any other reason related to the Case. Buyer shall retain such records
consistent with Buyer's normal record retention policies.
(iii) Promptly following receipt thereof, Buyer shall provide to Seller a
copy of the Phase I Environmental Assessment.
(d) Tax Matters.
(i) Seller shall include the items of the Company (including any items
required to be taken into account by Treasury Regulations SectionSection
1.1502-13 and 1.1502-19) on Seller's consolidated federal income Tax Returns
for all periods through the ending of Seller's tax year including the Closing
Date in accordance with Treasury Regulations Section 1.1502-76(b)(1)(ii)(A)(i)
and pay all federal income Taxes attributable to such income. Any items of
the Company that occur on the Closing Date other than items occurring after
the Closing which are outside the Company's ordinary course of business shall
not be subject to the next day rule as such rule is provided in Treasury
Regulations Section 1.1502-76(b)(1)(ii)(B). For all taxable periods ending on
or before the Closing Date, Seller shall cause the Company to join in Seller's
consolidated federal income tax return (and any consolidated, affiliated,
combined, unitary or similar other tax return where required or previously
filed) and, in jurisdictions where Company separately reports, Seller shall
cause to be filed with respect to the Company separate company state and local
income tax returns and shall cause to be timely paid any Taxes imposed on
Company. All such Tax Returns shall be prepared and filed in a manner
consistent with prior practice, except as required by a change in applicable
law or regulation. Buyer shall have the right, at its expense, to review and
comment on any such Tax Returns prepared by Seller. Buyer shall cause the
Company to furnish information to Seller as reasonably requested by Seller to
allow Seller to satisfy its obligations under this section in accordance with
past custom and practice. The Company and Buyer shall consult and cooperate
with Seller as to any elections to be made on Tax Returns of the Company for
periods ending on or before the Closing Date. Buyer shall include the Company
in its combined or consolidated income Tax Returns, as applicable, for all
periods other than periods ending on or before the Closing Date. Buyer and
Seller shall, and shall each cause its affiliates to, provide to the other
such cooperation and information, as and to the extent reasonably requested,
in connection with the filing of any Tax Return, determination of liability
for Taxes, or conduct of any audit, litigation or other proceeding with
respect to Taxes, which cooperation and information shall include providing
copies of all relevant Tax Returns (including any relevant Tax Return of
Seller or any group of Seller that includes the Closing Date), together with
relevant accompanying schedules and workpapers.
(ii) Seller shall pay the Buyer the amount of any Tax refund received by
Seller resulting from the carryback by Company of any post-closing income Tax
attribute of the Company into Seller's consolidated income Tax Return.
(iii) Seller shall allow the Company and its counsel to participate, at
its expense, in any audit of Seller's consolidated federal income Tax Returns
to the extent that such returns relate to the Company. Seller shall not
settle any such audit in a manner that would adversely affect the Company
after the Closing Date without the prior written consent of Buyer, which
consent shall not be unreasonably withheld or delayed.
(iv) Seller shall join Buyer, at Buyer's option, in making an election
under Code Section 338(h)(10) (and any corresponding elections under state,
local, or foreign tax law) (collectively a "Section338(h)(10) Election") with
respect to the purchase and sale of the stock of the Company hereunder. Any
Section 338(h)(10) Election must be made by Buyer, and Buyer shall be required
to notify Seller of such election, not later than 90 days prior to the
extended due date of Seller's federal income Tax Return (whether or not
extended) for the fiscal year during which the Closing occurs, provided that
Buyer shall in any event notify Seller within 30 days after Buyer has made any
Section 338(h)(10) Election. Seller will pay any Tax attributable to the
making of the Section338(h)(10) Election. At the Closing, Seller will deliver
to Buyer a fully executed IRS Form 8023 reflecting the Section338(h)(10)
Election and any similar form provided for under state, local or foreign law.
(v) Seller shall, and shall cause the Company to, take all necessary
actions such that all Tax sharing agreements or similar agreements with
respect to or involving the Company shall be terminated as of the Closing Date
and such that, after the Closing Date, the Company shall not be bound thereby
or have any liability thereunder.
(vi) Buyer shall pay to Seller all refunds of Taxes received by Buyer or
the Company after the Closing Date and attributable to Taxes paid by the
Company with respect to any pre-closing period or portion thereof (other than
those refunds to which Buyer is entitled pursuant to Section 8(d)(ii)). Buyer
shall not be required to seek any such tax refund whether at Seller's request
or otherwise or whether through the filing of amended Tax Returns, claims for
refunds or otherwise, if Buyer believes the Company is not reasonably entitled
to seek such refund. In the event that Seller chooses to seek any such Tax
refund directly, Buyer, at Seller's reasonable expense, will cooperate fully
with Seller in preparing and filing any related claims, amended returns or
other documents (including but not limited to relevant powers of attorney or
other required authorizations that would permit Seller to represent the
Company and receive directly any Tax Refunds resulting from Seller's filing
such claims, amended Tax returns or other required documents). Buyer is
entitled to waive the carryback of any net operating loss or other item of the
Company for any post-Closing period or portion thereof
(vii) Buyer shall not, and shall not cause, any Tax Return of the Company
for any period ending on or before the Closing Date to be amended without the
prior written consent of Seller.
(viii) Buyer shall not make, and shall not cause any election to be made,
other than the Section338(h)(10) Election as permitted by Section 8(d)(iv),
with respect to the Company that could increase the Tax liability of the
Company for any period or portion thereof ending on or before the Closing Date
to the extent such election would cause the Company or Seller to pay
additional Taxes (excluding for this purpose any election that would result
solely in any reduction in any net operating loss carryforward attributable to
the Company for periods ending after the Closing Date).
(ix) Seller shall not make, and shall not cause any election to be made,
with respect to the Company that could increase the Tax liability of the
Company for any period or portion thereof ending on or after the Closing Date
to the extent such election would cause the Company or Buyer to pay additional
Taxes (including for this purpose any election that would result solely in any
reduction in any net operating loss carryforward attributable to the Company
for periods ending on or before the Closing Date).
9. BANKRUPTCY COURT APPROVALS.
(a) Bid Protections, Break-Up Fee Order and Sale Motion. Seller has
obtained an order of the Bankruptcy Court (the "Break-Up Fee Order") which
authorizes the payment by Seller to Buyer of an amount equal to $250,000 for
the actual, necessary and reasonable out-of-pocket costs and legal fees
incurred by Buyer prior to the date of the Auction (without prejudice to
Buyer's right to seek additional amounts under a motion filed with the
Bankruptcy Court) in connection with (i) Buyer's investigation of Seller, the
Company and the Riverboat Casino Assets, (ii) negotiating this Agreement and
(iii) seeking to protect or enforce Buyer's rights under this Agreement (the
"Break-Up Fee") in the event this Agreement shall have been terminated
pursuant to Section 16 due to (A) Bankruptcy Court approval of a sale of the
Closing Shares or Riverboat Casino Assets, as applicable, to any Person other
than Buyer or an affiliate of Buyer (a "Competing Sale") or (B) Bankruptcy
Court approval of a competing plan of reorganization or liquidating plan
relating to the Closing Shares or the Riverboat Casino Assets not
incorporating this Agreement (a "Competing Plan"), which Break-Up Fee shall be
payable only upon a successful closing of such Competing Sale or the
occurrence of the effective date (the "Competing Plan Effective Date") of such
Competing Plan, as applicable; provided, however, that if Seller shall have
prepared and prosecuted the Company Plan of Reorganization in good faith, then
Buyer shall not be entitled to any Break-Up Fee in the event the Company Plan
of Reorganization is not confirmed.
Seller shall hold the Auction to sell the Closing Shares or Riverboat Casino
Assets, as applicable, to Buyer pursuant to Section 363(b) of the Bankruptcy
Code ("Sale Motion"). Subject to the terms of this Agreement, the Break-Up
Fee and refund of the Deposit (with interest accrued thereon, if any) shall be
an administrative expense claim under Section 503(b) of the Bankruptcy Code
and a surcharge under Section 506(c) of the Bankruptcy Code and shall be
payable immediately upon (as applicable) (A) the closing of the Competing Sale
(as a deduction from the purchase price paid by the buyer in the Competing
Sale) or (B) the Competing Plan Effective Date.
The bid procedures to be used for the Auction shall provide that any Qualified
Bidder may structure its bid as a purchase of the Riverboat Casino Assets from
the Company, rather than as a bid for the Closing Shares. Except as otherwise
permitted in this Agreement, each bid shall be substantially on the terms of,
or on more favorable terms for Seller or the Company (as applicable) than,
those set forth in this Agreement.
The Sale Hearing to approve the sale of the Closing Shares shall commence on
October 13, 2004. To the extent that a competing bidder seeks to submit a bid,
such competing bidder or an affiliate (as defined in the Bankruptcy Code) of
such competing bidder must be currently licensed as a gaming operator under
the laws of a state of the United States. In addition, such competing bidder
shall, at least three (3) days before the Auction (i.e. no later than 12:00
p.m. (Central Time) on October 4, 2004), deliver to Seller and/or the Company,
as applicable, (i) a refundable cash deposit of $1,000,000, (ii) reasonable
proof of the interested party's ability to consummate a purchase of the
Closing Shares or the Riverboat Casino Assets, as applicable, including a copy
of such party's annual, quarterly and monthly financial statements for the
most recently ended fiscal periods, certified to be true correct and complete
in all material respects, and (iii) an executed Sale and Purchase Agreement on
substantially the terms of, or on more favorable terms than those set forth
in, this Agreement, except as may be necessary to reflect an offer for the
purchase of only the Riverboat Casino Assets (and not the Closing Shares),
which Sale and Purchase Agreement shall (A) specify the amount of cash or
other consideration offered by the competing bidder for the Closing Shares
and/or the Riverboat Casino Assets, as applicable, (B) not be subject to
unperformed due diligence or conditions for a breakup fee or expense
reimbursement, and (C) constitute an irrevocable offer by such competing
bidder to complete its proposed purchase upon the terms set forth therein.
Once a competing bid that satisfies the above-enumurated requirements has been
submitted to the Seller, the Company or the Committee, such bid may be
modified by the applicable bidder at any time prior to the Auction to the
extent that such modifications would, in the opinion of the Committee, after
consultation with the Seller, the Company and the Bondholders, improve the
quality of such bid.
No initial competing offer will be considered unless (i) the aggregate
consideration to Seller or the Company under such bid is at least $250,000
more than the sum of the Purchase Price plus a Break-Up Fee of $450,000 (which
is the anticipated maximum amount of Buyer's out-of-pocket costs and legal
fees incurred prior to the date of the Auction) [On September 14, 2004, the
Bankruptcy Court entered the Order On Break Up Fees, in which it approved the
Break-up Fee. Any request for an increase in the Breakup Fee will be based
upon the Buyer's incurrence of actual, necessary and reasonable out-of-pocket
expenses in excess of the $250,000.] or (ii) the aggregate consideration to
Seller or the Company under such bid is at least $100,000 more than the
Purchase Price plus a Break-Up Fee of $450,000 and the Committee, after
consultation with the Bondholders, Seller and the Company, determines in its
sole discretion that such offer, taken as a whole, is a higher and/or better
bid than the bid set forth in this Agreement. In the event that the Committee
shall so determine that such bid is a higher and/or better bid than that set
forth in this Agreement, Buyer shall have the right to amend this Agreement as
necessary in its reasonable discretion in order to cause the Buyer's bid
hereunder to be comparable to such higher and/or better bid. Only those
persons submitting an offer in compliance with this section shall be a
"Qualified Bidder." Each Qualified Bidder shall be invited to attend an outcry
auction (the "Auction") at the Office of Xxxxxxxx Xxxxxx, LLP, which Auction
must be attended in person. The Seller and the Company shall cause the
Auction to commence at 1 p.m.. (Central Time), on October 7, 2004. Subject to
the limitations set forth above, the opening price at such Auction shall be
the highest and/or best offer of a Qualified Bidder (as determined by the
Committee in its sole discretion after consultation with the Bondholders,
Seller and the Company). Subsequent bids shall be in increments of $100,000
or such greater amount as designated by the Committee from time to time during
the Auction. At the request of Buyer, Seller shall provide or cause the
Committee to provide its valuation of any competing bid that constitutes the
highest and/or best offer at the time of such request.
Seller, the Company and the Committee shall consider bids submitted by Buyer
and the Qualified Bidders during the Auction and the Committee, after
consultation with the Bondholders, Seller and the Company, shall make a
determination of the highest and/or best offer in its sole discretion. The
determination of which bidder has submitted the highest and/or best offer for
the Closing Shares and/or the Riverboat Casino Assets, as applicable, at the
Auction shall be made by the Committee in its sole discretion after
consultation with the Bondholders, Seller and the Company, subject to the
final determination by the Court at the Sale Hearing. At the Sale Hearing,
the Court shall consider the results of the Auction and shall make a final
determination of the highest and/or best offer to the Company's bankruptcy
estate. After the determination of the winning bidder, Seller, or the
Company, as applicable, shall promptly execute the Sale and Purchase Agreement
previously executed and submitted by such winning bidder.
(b) Sale Order. By no later than three (3) business days following entry
of the Break-Up Fee Order, Seller and the Company will file the Sale Motion,
through which they will seek an order of the Bankruptcy Court in form
reasonably satisfactory to the Buyer and consistent with this Agreement (the
"Sale Order"). The Sale Order shall, among other things (i) order the sale of
the Closing Shares to Buyer pursuant to Section 363(b) of the Bankruptcy Code
on the terms and conditions set forth in this Agreement and authorize Seller
to proceed with this transaction, (ii) order that the sale of the Closing
Shares shall be free and clear of all Encumbrances and provide for an
injunction in favor of Buyer and its property, including the Closing Shares,
prohibiting any holder of a claim from taking any action or enforcing any
Encumbrance against the Closing Shares, (iii) include specific findings that:
(A) Buyer is a good faith purchaser of the Closing Shares and under Section
363(m) of the Bankruptcy Code is entitled to all protections thereby; that
Buyer is not a successor to Seller and this Agreement does not constitute a de
facto merger or consolidation of Seller and Buyer; Buyer is not a mere
consolidation or substantial continuation of Seller's business; Buyer is
entering the sale in good faith; (B) any objections to the Agreement and
related transactions are overruled, and that future objections to the
Agreement or related transactions are barred; (C) any subsequent bankruptcy
proceedings by Seller or the Company or reorganized Seller or dismissal of the
Case shall not affect the Agreement or related transactions; (D) that Seller
has full authority to execute the Agreement; and all necessary corporate
action has been taken; no consents or approvals other than those expressly
provided in the Agreement are required for consummation of the Agreement and
related transactions; (E) approval of the Agreement and consummation of the
transactions are in best interest of Seller and the Company and their
respective creditors and estates; (F) reasonable opportunity to object or be
heard with respect to the Sale Motion has been afforded to all interested
entities; (G) the Agreement was negotiated, proposed and entered by Seller and
Buyer, without collusion, in good faith, and from arms length bargaining
positions with parties represented by counsel and financial advisors; (H) the
terms and conditions of the Agreement and related transaction are fair and
reasonable; (I) the Bankruptcy Court retains exclusive jurisdiction to enforce
the Sale Order; and (J) such other items as are reasonably acceptable to
Buyer. Both Buyer's and Seller's obligations to complete the sale and
purchase of the Closing Shares are conditioned upon the Bankruptcy Court's
entry of the Sale Order.
(c) Confirmation Order. Promptly following the Sale Hearing, Seller will
cause the Company to seek an order of the Bankruptcy Court (the "Confirmation
Order") confirming a Plan of Reorganization of the Company (the "Company Plan
of Reorganization"). Both Buyer's and Seller's obligations to complete the
sale and purchase of the Closing Shares are conditioned upon the Bankruptcy
Court's entry of the Confirmation Order. Seller agrees that each of the
Company Plan of Reorganization and the Confirmation Order must be in form and
substance reasonably satisfactory to Buyer and shall not be inconsistent with
the provisions of this Agreement, and shall further provide for the following:
(i) the Purchase Price shall be used to pay in full, as of the effective
date of the Company Plan of Reorganization, all allowed pre-petition priority
claims against and post-petition administrative expenses of the Company other
than Company Liabilities;
(ii) the portion of the Purchase Price allocated to the Riverboat Casino
Assets in accordance with the Sale Order shall be used to fund the treatment
provided under the Company Plan of Reorganization of allowed secured and non-
priority unsecured claims against the Company;
(iii) except with respect to the Company Liabilities as described in
Section 3 hereof, the discharge of all secured and unsecured claims against
the Company;
(iv) except with respect to the Company Liabilities as described in
Section 3 hereof, the issuance of an injunction in favor of Buyer, the Company
and their respective properties, including the Riverboat Casino Assets,
prohibiting any holder of a claim against the Company in existence as of the
date immediately preceding the effective date of the Company Plan of
Reorganization from taking any action to collect, assess, enforce or recover
such claim;
(v) provide that Buyer shall be the owner of all of the Closing Shares,
which shall represent all of the issued and outstanding capital stock of the
Company;
(vi) ratify the findings in the Sale Order and include specific findings
that: (1) reasonable opportunity to object or be heard with respect to the
Confirmation Order has been afforded to all interested entities; and (2) the
Bankruptcy Court retains exclusive jurisdiction to enforce the Confirmation
Order;
(vii) the following assets shall be excluded from the Riverboat Casino
Assets (collectively, the "Excluded Assets"): (1) officer and crew personal
effects; (2) all cash (including checks received prior to the close of
business on the Closing Date, whether or not deposited or cleared prior to the
close of business on the Closing Date) other than Included Cash; (3) all
commercial paper, certificates of deposit and other bank deposits, treasury
bills and other cash equivalents other than the Included Cash; (4) all rights
of the Company to claims or recoveries under Chapter 5 of the United States
Bankruptcy Code; (5) all contracts, leases and other agreements other than the
Assumed Executory Leases and Executory Contracts; (6) all rights of Seller
and/or the Company under employee benefit plans and related trusts and
insurance policies and similar arrangements sponsored or maintained by Seller
for current or former employees; (7) the building, improvements and tangible
personal property (other than certain items of tangible personal property used
in the operation of the Riverboat Casino and listed on Schedule 6(b)), located
at 000 Xxxxx Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000 (the "Main Office"); (8)
subject to Buyer's rights under the Trademark License, all right, title and
interest of Seller in the name "President," "President Riverboat Casino" and
variants thereof, and all marks and logos, whether or not registered,
incorporating such names or portions thereof; (9) all risk management, general
ledger and fixed asset software (excluding data and related documentation), in
each case which are owned, used, or licensed by Seller as licensee or licensor
in connection with the Riverboat Casino ("Excluded Software"); (10) all
outstanding claims arising under Seller's insurance policies prior to the
Closing Date; (11) all rights to any refunds for Taxes accruing to the owner
of the Riverboat Casino Assets for the period prior to and including the
Closing Date, including but not limited to all claims for refund for Missouri
state and local sales and use taxes, regardless whether such claims were
actually filed prior to the Closing Date; (12) all inventory of food and
beverages existing on the Closing Date and held for sale by the Company at the
food service and dining facilities located at the Riverboat Casino ("Food
Inventory"); and (13) all inventory of the Company existing on the Closing
Date and held for resale to customers at the Company's gift shop located
aboard the Riverboat Casino ("Gift Shop Inventory");
(viii) pursuant to Section 1141(c) of the Bankruptcy Code and other than
with respect to the Assumed Liabilities, the Company shall hold the Riverboat
Casino Assets free and clear of, all claims and interests of creditors to the
maximum extent permitted under Section 1141(c) of the Bankruptcy Code (the
"Excluded Liabilities"), and, without limiting the foregoing, the Confirmation
Order shall specifically provide that the Company shall hold the Riverboat
Casino Assets free and clear of each of the following (which shall be deemed
to be Excluded Liabilities): (1) Liabilities for Taxes related to all Tax
periods (or portions thereof) ending on or prior to the Closing; (2)
Liabilities for any costs or expenses incurred arising out of or related to
the administration of the Bankruptcy Case, including any accrued professional
fees and expenses of attorneys, accountants, financial advisors and other
professional advisors (collectively, the "Administrative Claims"); (3)
Liabilities arising out of or related to the Excluded Assets; (4) any Cure
Amounts payable by Seller pursuant to Section 2(c), or (5) Liabilities of
Seller under this Agreement.
(ix) the assumption by the Company of the Assumed Executory Leases and
Executory Contracts under Section 365 of the Bankruptcy Code;
(x) the affirmation of each of the provisions of the Sale Order; and
(xi) the retention by the Bankruptcy Court of exclusive jurisdiction to
enforce all provisions of the Confirmation Order relating to the Sale Order.
(d) Return of Deposit and Expense Reimbursement. If this Agreement is
terminated in accordance with Section 16 hereof for any reason (other than a
termination by Seller solely as a result of a material breach of the terms
hereof by Buyer), then the Deposit (together with interest thereon) shall be
immediately returned to Buyer. If (i) this Agreement is terminated by Buyer
pursuant to Section 16(b) or (ii) (A) this Agreement is terminated by Buyer or
Seller pursuant to Section 16(h) and (B) Seller shall not have prepared and
prosecuted the Company Plan of Reorganization in good faith, then, in addition
to payment of the Deposit (together with interest thereon) to Buyer, Seller
shall reimburse Buyer, up to the amount of $250,000, for the actual, necessary
and reasonable out-of-pocket costs and legal fees incurred by Buyer in
connection with Buyer's investigation of Seller, the Company and the Riverboat
Casino Assets and the negotiation of this Agreement (the "Expense
Reimbursement").
(e) Superpriority Claim. Buyer shall have (and is hereby granted by
Seller) a superpriority administrative expense claim senior to all other
administrative expenses in the Seller Case in an amount equal to the sum of
the Break-Up Fee and the Deposit (together with interest thereon) and the
Expense Reimbursement. The grant of the superpriority claim described herein
shall be included in the Break-Up Fee Order.
(f) No Solicitation. From the date this Agreement is executed by Buyer and
Seller until the date that the Break-Up Fee Order is signed by the Bankruptcy
Court, neither Seller nor its advisors, officers, directors, agents or
employees, shall, and Seller shall cause the Company and its advisors,
officers, directors, agents or employees not to, directly or indirectly,
market, seek, advertise or otherwise solicit any offers for the purchase of
the Closing Shares or the Riverboat Casino Assets other than in respect of
Persons who have contacted Seller, the Company or any of their respective
advisors after the date hereof regarding a purchase of the Closing Shares or
Riverboat Casino Assets.
10. MGC APPROVAL. Within thirty (30) business days after the issuance of the
Sale Order, Buyer shall file with the Commission all applications,
certifications and other documents as may be appropriate to obtain the MGC
Approval, which applications, certifications and other documents shall be
limited only to matters directly related to those approvals and orders that
are necessary in order for Buyer to lawfully operate the Riverboat Casino
under the laws and regulations of the State of Missouri, and make available to
Seller copies of all such materials (except confidential or commercially
sensitive material) together with evidence of filing. Buyer shall use all
commercially reasonable efforts to comply with all requests of the Commission
and to obtain the MGC Approval and further agrees not to take any action that
could reasonably be expected to impede or delay the issuance by the Commission
of the MGC Approval or result in the refusal of the Commission to issue the
MGC Approval. From time to time at Seller's written request, Buyer shall
deliver a written update of the status of such application and the most recent
communications between Buyer and the Commission.
11. CLOSING. The closing of the sale and purchase of the Closing Shares and
the other transactions contemplated hereby (the "Closing") shall occur as
promptly as practicable, and in any event on the date (the "Closing Date")
which is the third business day after satisfaction (or written waiver) of the
conditions to Closing set forth in Sections 4 and 5 (other than conditions
with respect to actions the respective parties will take at the Closing
itself). The Closing shall occur at the principal office of Seller or as
otherwise agreed by the parties hereto.
(a) At Closing, Seller shall deliver to Buyer the instruments, documents
and agreements required to be delivered by Seller under Section 4 hereof.
(b) At Closing, Buyer shall do or deliver to Seller the following:
(i) pay the Purchase Price less the Deposit (with interest accrued
thereon, if any) by wire transfer of immediately available funds to such
account or accounts as Seller shall direct in writing;
(ii) deliver to Seller irrevocable written authorization to apply the
Deposit (with interest accrued thereon, if any) against the Purchase Price;
and
(iii) deliver to Seller the instruments, documents and agreements
required to be delivered by Buyer under Section 5 hereof (to the extent
required to be delivered at such time).
12. BROKERS. Except for Libra Securities Corporation and other financial
advisors to Seller, which have been engaged by and at the expense of Seller,
each party hereto represents that it has not retained a broker or other Person
entitled to any commission or other compensation in connection with the
transaction contemplated herein. Each of Seller and Buyer shall indemnify and
hold the other harmless from and against the rights or claims of any Person
claiming through such party to be entitled to any such commission or
compensation; provided that Buyer is not responsible for payment of Seller's
advisors.
13. DELIVERY. The Closing Shares shall be deemed delivered to Buyer
hereunder at St. Louis, Missouri, simultaneous with the Closing. Except as
otherwise provided in Section 2(b), Buyer shall not be responsible for any
sale, use or similar taxes, fees and expense imposed in Missouri or elsewhere
upon or in connection with the sale of the Closing Shares.
14. SELLER'S REPRESENTATIONS, WARRANTIES AND COVENANTS. Notwithstanding
anything to the contrary herein, prior to the Closing, Buyer will not have any
recourse to Seller in the event any of the representations and warranties made
herein or deemed made are untrue as at any time of expression thereof, except
in the case of fraud and except that Buyer may terminate this Agreement in
accordance with Section 16 hereof and, if applicable, shall have the right to
receive payment of the Break-Up Fee, the Deposit and/or Expense Reimbursement
as provided in, and subject to the terms and conditions set forth in, this
Agreement; provided, however, that Buyer's obligation to purchase the Closing
Shares at Closing is expressly conditioned (unless waived by Buyer in writing)
upon satisfaction of each of the conditions set forth in Sections 4. The only
remedy for a breach of such representations and warranties shall be Buyer's
option not to close and Buyer's right to terminate this Agreement in
accordance with and subject to the limitations set forth in Sections 4 and 16.
Without limiting the foregoing, following the Closing, Buyer shall have no
remedy whatsoever for any breach of any representation or warranty made by
Seller herein, except in the case of fraud. All representations, warranties
and (except as set forth in the following sentence) covenants set forth in
this Agreement or in any certificate, document or other instrument delivered
in connection herewith shall terminate at the earlier of (i) the Closing and
(ii) termination of this Agreement in accordance with Section 16, provided,
however, that those covenants that contemplate actions to be taken or restrict
actions from being taken after the Closing or termination of this Agreement,
as the case may be, shall survive in accordance with their terms.
15. RISK OF LOSS.
(a) All risk of loss, whether total loss, constructive total loss or less
than total loss or constructive total loss shall be borne by Seller prior to
the Closing and any insurance proceeds for events occurring prior to the
Closing shall be for Seller's account. Buyer shall have no obligation to
purchase the Closing Shares if the Riverboat Casino is damaged in any material
respect after its inspection and survey and prior to Closing. All insurance
proceeds for such loss shall be paid to and solely for the account of Seller.
In the event that the Riverboat Casino suffers damage which does not
constitute a total loss or constructive total loss, Buyer may, at its sole
option, elect to purchase the Closing Shares, in which case any insurance
proceeds payable with respect to such accident shall be used by Buyer to
repair and/or replace the Riverboat Casino and other affected Riverboat Casino
Assets. In order to assist in having such repairs accomplished, Seller shall
assign to Buyer all of its rights under the insurance policies covering such
loss.
(b) All risk of loss, whether total loss, constructive total loss or less
than total loss or constructive total loss shall be borne by Buyer subsequent
to the Closing and any insurance proceeds for events occurring subsequent to
the Closing shall be for Buyer's account.
16. TERMINATION EVENTS. This Agreement may be terminated prior to the
Closing Date:
(a) by Buyer or Seller upon written notice to the other party at any time
prior to the Closing (i) if the Confirmation Order has not been entered on or
before August 1, 2005 or the Break-Up Fee Order has not been entered on or
before the date that is forty (40) days after the date of this Agreement (or
such later date(s) as mutually agreed to by the parties with respect to the
foregoing) or (ii) Closing shall not have occurred on or before August 1, 2005
(or such later date as is mutually agreed to by the parties), by reason of the
failure of any condition precedent under Section 4, provided that such
failure did not result primarily from the terminating party materially
breaching any covenant contained in this Agreement, or unless the terminating
party shall have waived such condition precedent in writing);
(b) by Buyer upon written notice to Seller if Buyer is in compliance in all
material respects with this Agreement and Seller fails to perform any material
obligation required to be performed by Seller prior to or at the Closing,
which failure continues for twenty (20) business days after written notice
from Buyer to Seller of such failure;
(c) by Seller upon written notice to Buyer if Seller is in compliance in
all material respects with this Agreement and Buyer fails to perform any
material obligation required to be performed by Buyer prior to or at the
Closing, which failure continues for twenty (20) business days after written
notice from Seller to Buyer of such failure;
(d) by mutual written agreement of Buyer and Seller;
(e) by Seller or Buyer upon written notice to the other if either (A)
Seller, with the approval of the Bankruptcy Court, enters into any contract
with a third party for the sale of the Closing Shares or any of the Riverboat
Casino Assets to a Person other than Buyer or Buyer's designee, or (B) the
Bankruptcy Court approves a Competing Plan;
(f) by Buyer upon written notice to Seller if any of the conditions of
Section 4 cannot be met and will not be waived by Buyer;
(g) by Seller upon written notice to Buyer if any of the conditions of
Section 5 cannot be met and will not be waived by Seller;
(h) by Seller or Buyer in the event the Company Plan of Reorganization is
not confirmed; and
(i) [intentionally omitted].
Upon a valid termination of this Agreement by Seller pursuant to subsection
(c) above, the Deposit (excluding interest accrued thereon, if any) shall be
forfeited to Seller, but without prejudice to any legal remedy for money
damages Seller may have, if any, against Buyer as a result of such breach;
provided, however, that Seller's legal remedies hereunder shall be limited
exclusively to money damages, and, provided, further, that in no event shall
Seller have the right to specific performance or any other equitable remedy
against Buyer in connection with this Agreement or the transactions
contemplated hereby. Upon a valid termination of this Agreement pursuant to
subsection (a), (b), (d), (e), (f), (g), (h) or (i), the Deposit (with
interest accrued thereon, if any) shall be returned to Buyer.
17. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the internal laws of the State of Missouri, and where
applicable, the federal laws of the United States.
18. NO CONTRIBUTION. Following the Closing, Seller shall not seek, nor will
Seller be entitled to, contribution from, or indemnification by, the Company,
under the Company's charter documents, this Agreement, applicable corporate
laws or other laws or otherwise, in respect of amounts due from Seller in
connection with any claim or suit arising under this Agreement.
19. JURISDICTION. In the event any dispute shall arise in connection with
the interpretation of this Agreement or the respective rights and obligations
of the parties hereunder, each party submits to the exclusive jurisdiction of
the Bankruptcy Court for the resolution of such dispute.
20. NOTICES. All notices or other communications required or permitted to be
given under this Agreement shall be given in writing and delivered personally
or sent by registered mail (with postage prepaid) or recognized courier or fax
to the following address and fax number, or to such other address as any party
may from time to time designate in a notice to the other.
If to Buyer: Penn National Gaming, Inc.
000 Xxxxxxxxx Xxxxxxxxx
Xxxxxxxxxx, XX 00000
Attention: Xxxxxx Xxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
E-Mail: xxxxxx.xxxxxxx@xxxxxxxx.xxx
with a copy to: Xxxxxx, Xxxxx & Xxxxxxx LLP
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
Attention: Xxxxxx Xxxxxxxx
Telephone: (000) 000-0000
Telecopier: (000) 000-0000
E-Mail: xxxxxxxxx@xxxxxxxxxxx.xxx
If to Seller: President Riverboat Casino-Missouri, Inc.
000 Xxxxx Xxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Attention: Xxxx X. Xxxxxxxxx
President & Chief Operating Officer
Telephone: 000-000-0000
Facsimile: 000-000-0000
with a copy to: Xxxxxxxx Xxxxxx, LLP
One XX Xxxx Xxxxx
Xx. Xxxxx, Xxxxxxxx 00000
Attention: Xxxxx X. Xxxxxx and
Xxxxxx X. Xxxxxxx, Xx.
Telephone: 000-000-0000
Facsimile: 000-000-0000
and with a copy to: Milbank, Tweed, Xxxxxx & XxXxxx XXX
00xx Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx and
Xxxxx X. Xxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
and with a copy to: Xxxxxxxxx Xxxxxxx Xxxxx Xxxxxx LLP
000 Xxxxx Xx., Xxxxx 0000
Xx. Xxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
Any such notice or communication shall be deemed to have been duly served (if
given or made personally) immediately or (if given or made by facsimile) upon
evidence of transmission or upon confirmed answerback or (if given or made by
recognized courier) once the return receipt for the served notice has been
signed by the party receiving the notice or (if given or made by letter) 48
hours after posting or and in proving the same it shall be sufficient to show
that the envelope containing the same was duly addressed, stamped and posted.
Each notice or communication made by telefax shall be followed by a
confirmation copy to be sent by post. Failure to send any confirmation copy
shall have no effect on the validity or deemed delivery of the notice or
communication.
21. FURTHER ASSURANCES. Seller and Buyer shall do and perform such other and
further acts and execute and deliver any and all such other and further
instruments as may be required by law or reasonably requested by the other
(and at such other party's cost) to establish, maintain and protect the
respective rights and remedies of the other and to carry out and effect the
intent and purpose of this Agreement.
22. ENTIRE AGREEMENT; COUNTERPARTS. This Agreement constitutes the entire
understanding of the parties and supersedes any and all other agreements,
written or oral, with respect to the subject matter hereof. This Agreement
may only be modified or amended by a written instruments signed by the party
or parties against which such modification or amendment is to be enforced.
Seller shall cause the Company to join in, and agree to be bound by, any
waiver, consent or agreement made or given by Seller under this Agreement.
This agreement may be executed in two or more counterparts which together
shall constitute a single agreement.
23. BINDING EFFECT AND ASSIGNMENT. This agreement shall be binding on the
parties hereto and inure to the benefit of their respective successors and
assigns. Neither party may assign its rights or interests under this
agreement prior to the closing, unless the prior written consent of the other
party is obtained, except that this Agreement may be assigned by Buyer as
collateral security for obligations of Buyer to a financial institution or
institutions.
24. HEADINGS; INTERPRETATION. The section and other headings contained in
this Agreement are inserted for convenience only and shall not affect in any
way the meaning or interpretation of this Agreement. Unless the context of
this Agreement clearly requires otherwise, (a) references to the plural
include the singular, the singular the plural, the part the whole, (b)
references to any gender include all genders, (c) "including" has the
inclusive meaning frequently identified with the phrase "but not limited to,"
and (d) references to "hereunder" or "herein" relate to this Agreement.
Section, subsection, Schedule and Exhibit references are to this Agreement
unless otherwise specified. Each accounting term used herein that is not
specifically defined herein shall have the meaning given to it under GAAP.
25. INCORPORATION OF EXHIBITS AND SCHEDULES. The Exhibits and Schedules
identified in this Agreement are incorporated herein by reference and made a
part hereof. Any items listed or described on the Exhibits or Schedules shall
be listed or described under a caption that specifically identifies the
Section(s) of this Agreement to which the item relates (which, in each case,
shall constitute the only valid disclosure with respect to such Section(s)).
IN WITNESS WHEREOF, the parties have caused this Riverboat Casino Sale and
Purchase Agreement to be executed by their duly authorized representatives as
of the day and year first above written.
SELLER:
PRESIDENT CASINOS, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxxxx
----------------------------------------
Title: Sr. VP & CFO
---------------------------------------
COMPANY:
PRESIDENT RIVERBOAT CASINO-MISSOURI, INC.
By: /s/ Xxxxx X. Xxxxxxxx
------------------------------------------
Name: Xxxxx X. Xxxxxxxx
----------------------------------------
Title: Sr. VP & CFO
---------------------------------------
BUYER:
PENN NATIONAL GAMING, INC.
By: /s/ Xxxxx XxXxxxxx
------------------------------------------
Name: Xxxxx XxXxxxxx
----------------------------------------
Title: President and COO
---------------------------------------
