EXHIBIT 10.165
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT (the "Agreement"), is entered into this
4th day of May, 1997, by and between NuOASIS GAMING INC., a Delaware corporation
("NGI"), and XXXX XXXXXXX'X XX, INC., a Colorado corporation ("XXXX"), on the
basis of the following recitals:
WHEREAS, Casino Management of America, Inc., a Utah corporation ("CMA")
is a wholly owned subsidiary of NGI.
WHEREAS, NGI desires to sell, assign and transfer to XXXX all of the
outstanding shares of stock of CMA ("CMA Shares") consisting of 7,500,000 shares
of common stock, and XXXX desires to purchase the CMA Shares for One Million Two
Hundred Thirty Five Thousand Dollars ($1,235,000) upon and subject to the terms
and conditions of this Agreement.
NOW, THEREFORE, for and in consideration of the mutual promises herein,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, NGI and CMA agree as follows:
SALE OF CMA SHARES.
Upon and subject to all the terms and conditions of this Agreement, at
the Closing NGI shall assign and transfer the CMA Shares to XXXX, and as full
consideration therefor XXXX shall pay NGI One Million Two Hundred Thirty Five
Thousand Dollars ($1,235,000).
EFFECTIVE DATE AND CLOSING; DELIVERY OF CMA SHARES.
DATE AND PLACE. The closing of this Agreement and transfer of the CMA
Shares (the "Closing") shall occur at the offices of Skjerven, Morrill,
XxxXxxxxxx, Xxxxxxxx and Xxxxx LLP as escrow agent, at such time or date as the
parties hereafter may mutually agree. The time and date of the Closing are
herein called the "Closing Date".
PAYMENT. At the Closing, XXXX shall deliver to NGI through escrow the
sum of $1,140,000 in certified funds and a credit of $95,000 against the
payments due on the intercompany account between XXXX and NGI.
DELIVERY OF CMA SHARES. NGI shall deliver to XXXX through escrow a
stock certificate or certificates registered in the name of XXXX the CMA Shares,
and XXXX shall deliver to CMA and NGI written confirmation, in form reasonably
satisfactory to CMA and NGI, of its investment intent with regard to such
shares, and such other or further documentation as CMA or NGI then may
reasonably require in order to comply with then-applicable federal and state
securities laws or applicable stock exchange requirements. The number, type and
kind of the CMA Shares delivered to XXXX, in each case, shall be adjusted to
reflect all stock splits, stock dividends, reverse stock splits,
reclassifications, mergers and similar capital changes that shall have occurred
in the outstanding common stock of CMA prior to the Closing; provided, however,
that neither the foregoing provision, nor any other provision of this Agreement,
shall be construed to confer on XXXX any of the rights, powers or benefits of
ownership of shares of CMA (including without limitation cash dividends, voting
rights, or stock purchase rights) as to any CMA Shares that shall not actually
have been issued and delivered to XXXX pursuant to this Section 2C.
DELIVERY OF OTHER DOCUMENTS. At the Closing, each party hereto shall
deliver to the other party through escrow such other and further documents,
instruments and information as are herein required to be delivered at the
Closing by such party or as are customarily delivered at the closing of a
transaction of the type provided for in this Agreement.
FURTHER DOCUMENTS. From time to time after the Closing, upon the
reasonable request of either party, the other party will deliver such other and
further instruments and documents as may be necessary to more fully vest in the
requesting party the consideration provided for in this Agreement or to enable
the requesting party to obtain the rights and benefits contemplated by this
Agreement.
A. REPRESENTATIONS AND WARRANTIES OF NGI.
NGI hereby covenants with and represents and warrants to XXXX that:
1. THE CMA SHARES. The CMA Shares are and will be as of the Closing
Date, owned, of record and beneficially, by XXXX, free and clear
of all liens, claims and encumbrances, and NGI has all necessary
right and power to enter into and perform this Agreement and to
assign and sell the CMA Shares to XXXX as provided herein. Any
necessary shareholder approval of NGI's shareholders will be
obtained prior to Closing.
2. AUTHORITY. NGI has the full corporate power and authority to
enter into this Agreement and to carry out the transactions
contemplated by this Agreement. The Board of Directors of NGI
have duly authorized the execution, delivery, and performance of
this Agreement. Upon execution, this Agreement constitutes the
valid, binding and enforceable obligation of NGI.
3. STATUS OF CMA. CMA is duly organized, validly existing, and in
good standing under the laws of Utah.
4. NO CONFLICT WITH OTHER INSTRUMENT. Except as disclosed herein,
the execution of this Agreement will not violate or breach any
document, instrument, agreement, contract, or commitment to which
NGI or CMA is a party or by which it or CMA is bound.
5. FULL DISCLOSURE. The information concerning CMA set forth herein
and in the CMA Financials, as defined below, is complete and
accurate in all material respects and does not contain any untrue
statement of a material fact or omit to state a material fact
require to make the statements made, in light of the
circumstances under which they were made, not misleading.
6. FINANCIAL STATEMENTS. Financial statements of CMA for the quarter
ending March 31, 1997 ("CMA Financials"), have been or will be
delivered to XXXX prior to the Closing Date. To the best
knowledge of NGI, except as set forth in the CMA Financials,
there are no liabilities, either fixed or contingent, not
reflected in such financial statements other than contracts or
obligations in the ordinary and usual course of business, which
would constitute liens or other liabilities which, if disclosed,
would alter substantially the financial condition of CMA as
reflected in such financial statements. Since March 31, 1997,
there have been no material changes in CMA's financial condition.
7. CAPITALIZATION OF CMA. The capitalization of CMA is, as of the
date hereof, comprised of 25,000,000 shares of authorized common
stock, $.01 par value, of which approximately 7,500,000 shares
are issued and outstanding.
8. COMPLIANCE WITH LAWS. Rules and Regulations. NGI represents and
warrants that it is in compliance with all applicable federal
laws, rules and regulations; and all applicable state laws, rules
and regulations relating to its ownership of CMA except to the
extent that non-compliance would not materially and adversely
affect the business, operations, properties, assets, or condition
of NGI and its subsidiaries or except to the extent that
non-compliance would not result in the incurring of any material
liability for NGI.
9. CONDUCT OF BUSINESS. Since March 31, 1997, except as disclosed on
Exhibit "B", CMA has not (1) discharged or satisfied any liens
other than those securing, or paid any obligation or liability
other than current liabilities shown on the CMA Financials and
current liabilities incurred since the date of the CMA
Financials, in each case in the usual or ordinary course of
business, (ii) mortgaged, pledged or subjected to lien any of
their tangible or intangible assets (other than purchase money
liens incurred in the ordinary course of business for such assets
not yet paid for), (iii) sold, transferred or leased any of their
assets except in the usual and ordinary course of business, (iv)
canceled or compromised any material debt or claim, or waived or
released any right of material value, (v) suffered any physical
damage, destruction or loss (whether or not covered by insurance)
materially adversely affecting its properties, business or
prospects, (vi) entered into any transaction other than in the
usual and ordinary course of business, except as contemplated by
this Agreement, (vii) encountered any labor difficulties or labor
union organizing activities, (viii) made or agreed to any wage or
salary increase or entered into any employment agreement, (ix)
issued or sold any securities or granted any options with respect
thereto, except as disclosed pursuant to this Agreement,
(x)amended its Articles of Incorporation, (xi) agreed to declare
or pay any distributions with respect to their outstanding
capital stock, or (xii) suffered or experienced any change in, or
condition affecting, the condition (financial or otherwise) of
their properties, assets, liabilities, business, operations or
prospects, other than changes, events or conditions in the
ordinary course of their business none of which has (individually
or in the aggregate) been materially adverse, except as disclosed
ill the CMA Financials.
10. LITIGATION. To the best knowledge and belief of CMA, except as
disclosed in the CMA Financials or in NGI's Form 10-KSB for the
year ended June 30, 1996, there is neither pending nor
threatened, any action, suit or arbitration to which CMA's
property, assets or business is or is likely to be subject and in
which an unfavorable outcome, ruling or finding will or is likely
to have a material adverse effect on the condition, financial or
otherwise, or properties, assets, business or operations of CMA,
or create any material liability on the part of CMA or conflict
with this Agreement or any action taken or to be taken in
connection herewith.
11. CONTRACTS. Except as disclosed in the CMA Disclosure Documents,
there are no contracts, actual or contingent obligations,
agreements, franchises, license agreements, or other commitments
to which CMA is a party or by which it or any of its properties
or assets are bound which are material to the business, financial
condition, or its results of operation. For purposes of the
preceding sentence, the term "material" refers to any obligation
or liability which by their terms calls for aggregate payments of
more than $10,000.
12. MATERIAL CONTRACT BREACHES, DEFAULTS. To the best of their
knowledge and belief, CMA has not materially breached, nor have
they any knowledge of any pending or threatened claims or any
legal basis for a claim that CMA has materially breached, any of
the terms or conditions of any agreements, contracts, or
commitments to which they are a party or is bound and which are
material to the business, financial condition, or results of
operations of CMA, taken as a whole. To the best of their
knowledge and belief, CMA is not in default in any material
respect under the terms of any outstanding contract, agreement,
lease, or other commitment which is material to the business,
operations, properties, assets, or condition of CMA, and there is
no event of default or other event which, with notice or lapse of
time or both, would constitute a default in any material respect
under any such contract, agreement, lease, or other commitment in
respect of which CMA has not taken adequate steps to prevent such
a default from occurring.
13. INVESTMENTS. CMA has provided, or will provide to the Company,
prior to Closing, a complete and accurate description of the CMA
assets, including but not limited to a list of all investments of
CMA, which accurately sets forth the nature of CMA's interest or
ownership in each investment and, if applicable, the
jurisdictions in which the respective investments have been
incorporated, organized, and currently doing business. Except for
the entities identified on the list to be provided to XXXX, there
is no corporation, limited partnership, limited partnership,
joint venture, association, trust, or other entity or
organization which CMA directly or indirectly controls or in
which CMA directly or indirectly owns any equity interest or any
other interest.
14. CORPORATE RECORDS. Copies of all corporate books and records,
including but not limited to stock transfer ledgers, and any
other documents and records of CMA will be provided to the
Company at Closing. All such records and documents are complete,
true, and correct.
15. BROKERS. NGI has not agreed to pay any brokerage fees, finder's
fees, or other fees or commissions with respect to the
transactions contemplated in tiffs Agreement. To the best of
NGI's knowledge, no person or entity is entitled, or intends to
claim that they are entitled, to receive any such fees or
commissions in connection with such transactions. NGI further
agrees to indemnify and hold harmless XXXX against liability to
any broker claiming to act on behalf of NGI.
16. DATE OF REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of XXXX and NGI set forth in this
Agreement are true and correct at and as of the Closing Date,
with the same force and effect as though made at and as of the
Closing Date, except for changes permitted or contemplated by
this Agreement.
B. REPRESENTATIONS AND WARRANTIES OF XXXX.
1. XXXX hereby represents and warrants that, effective this date and
the Closing Date, the representations and warranties listed below
are true and correct.
2. ORGANIZATION AND AUTHORITY. XXXX is a corporation duly
incorporated, validly existing and in good standing under the
laws of the State of Colorado with the corporate power and
authority to carry on its business as now being conducted. XXXX
has the full corporate power and authority to enter into this
Agreement and to carry out the transactions contemplated by this
Agreement. The Board of Directors of XXXX have duly authorized
the execution, delivery, and performance of this Agreement. Upon
execution this Agreement constitutes the valid, binding and
enforceable obligation of XXXX.
3. QUALIFICATION. As of the Closing Date, XXXX will be in good
standing in the State of Colorado, and will be duly qualified to
do business in each state and jurisdiction where the failure to
qualify would have a material adverse effect on its business.
4. NO CONFLICT. The execution of this Agreement will not violate or
breach any document, instrument, agreement, contract, or
commitment material to the business of XXXX or to which XXXX is a
party, and has been duly authorized by all appropriate and
necessary action.
5. FULL DISCLOSURE. The information concerning XXXX set forth in
this Agreement is complete and accurate in all material respects
and does not contain any untrue statement of a material fact or
omit to state a material fact required to make the statements
made, in light of the circumstances under which they were made,
not misleading.
6. ABILITY TO CARRY OUT AGREEMENT. To the best of NONA's knowledge
and belief, the execution and performance of this Agreement will
not violate, or result in a breach of, or constitute a default
in, any provisions of applicable law, any agreement, instrument,
judgment, order or decree to which XXXX is a party or to which
XXXX is subject so as to give rise to a claim by anyone against
XXXX. Other than such violations, breaches, or defaults which,
individually or in the aggregate, will not have a material
adverse effect on the enforceability or validity of this
Agreement or on the transactions contemplated under this
Agreement. No consents of any persons under any contract or
agreement required to be disclosed or disclosed pursuant to this
Agreement are required for the execution, delivery, and
performance by XXXX of this Agreement.
7. SECURITIES LAWS. XXXX is a public company and is required to file
periodic reports under Section 12(g) of the '34 Act. XXXX
represents that all reports required to be filed pursuant to the
'34 Act and any applicable U.S. state "Blue Sky" laws have been
filed.
8. BROKERS. XXXX has not agreed to pay any brokerage fees, finder's
fees, or other fees or commissions with respect to the
transactions contemplated in this Agreement which could give rise
to a claim against the CMA Shares or any portion thereof. To the
best of NONA's knowledge, no person or entity is entitled, or
intends to claim that it is entitled, to receive any such fees or
commissions in connection with such transactions. XXXX further
agrees to indemnify and hold harmless NGI against liability to
any broker claiming to act on behalf of XXXX.
9. APPROVALS. Except as otherwise provided in this Agreement, to
NONA's best knowledge and belief no authorization, consent, or
approval of, or registration or filing with, any governmental
authority or any other person is required to be obtained or made
by XXXX in connection with the execution, delivery, or
performance of this Agreement, except for the filing of Form 8-K
following the Closing.
10. DATE OF REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of XXXX set forth in this
Agreement is true and correct at and as of the Closing Date, with
the same force and effect as though made at and as of the Closing
Date, except for changes permitted or contemplated by this
Agreement.
C. DAMAGES AND LIMIT OF LIABILITY OF NGI.
1. NGI shall be liable to XXXX for any material breach of the
representations, warranties, and covenants contained herein
which results in a failure to perform any obligations under
this Agreement, but only to the extent of the expenses
actually incurred by XXXX in connection with such breach or
failure to perform Agreement.
D. TERMINATION.
This Agreement may be terminated at any time prior to the Closing Date:
BY XXXX OR NGI:
1. If there shall be any actual or threatened action or
proceeding by or before any court or any other governmental
body which shall seek to restrain, prohibit, or invalidate the
transactions contemplated by this Agreement and which, in the
judgment of such Board of Directors made in good faith and
based upon the advice of legal counsel, makes it inadvisable
to proceed with the transactions contemplated by this
Agreement; or
2. If the Closing shall not have occurred prior to May 15, 1997
or such later date as shall have been approved by parties
hereto, other than for reasons set forth herein.
BY XXXX.
1. If NGI shall fail to comply in any material respect with any of
its covenants or agreements contained in this Agreement, or if
any of the representations or warranties of NGI contained herein
shall be inaccurate in any material respect.
2. BY NGI. If XXXX shall fail to comply in any material respect with
any of its covenants or agreements contained in this Agreement,
or if any of the representations or warranties of XXXX contained
herein shall be inaccurate in any material respect.
EFFECT OF TERMINATION. In the event this Agreement is terminated
pursuant to this Section 6, this Agreement shall be of no further force
or effect, and no obligation, right, or liability shall arise hereunder
and each party shall bear its own costs in connection with the
negotiation, preparation, and execution of this Agreement and any due
diligence conducted pursuant to this Agreement.
D. PRIVATE TRANSACTION.
XXXX understands that the CMA Shares have not been registered under the
Act and the transfer of such shares hereunder is made pursuant to an
exemption from registration pursuant to Regulation D and Section 4(2)
of the Act, and NGI's reliance on such exemption is predicted in part
on the representations set forth herein and in the Investment Letter
attached hereto as Exhibit "C" ("Investment Letter").
E. ACCESS TO INFORMATION.
XXXX and NGI represent that, by virtue of their respective economic
bargaining power or otherwise, they have had access to or has been
furnished with, prior to or concurrently with the execution hereof, the
same kind of information that would be available in a registration
statement under the Act should registration of the CMA Shares had been
necessary, and that they have had the opportunity to ask questions of
and receive answers from the other party, or any party acting on their
behalf, concerning the business of CMA and that they have bad the
opportunity to obtain any additional information, to the extent that
CMA and NGI possesses such information or can acquire it without
unreasonable expense or effort, necessary to verify the accuracy of
information obtained or furnished by CMA or NGI.
G. INDEMNIFICATION BY NGI.
As provided herein, NGI shall indemnify and hold harmless XXXX for two
(2) years following the date of Closing under this Agreement against
and in respect of any liability, damage, or deficiency, all actions,
suits, proceedings, demands, assessments, judgments, costs and expenses
resulting from any misrepresentations, breach of covenant or warranty,
or from any misrepresentation contained in any certificate furnished by
NGI to XXXX hereunder.
H. INDEMNIFICATION BY XXXX.
As provided herein, XXXX shall indemnify and hold harmless NGI for two
(2) years following the date of Closing under this Agreement against
and in respect of any liability, damage, or deficiency, all actions,
suits, proceedings, demands, assessments, judgments, costs and expenses
resulting from any misrepresentations, breach of covenant or warranty,
or from any misrepresentation contained in any certificate furnished by
XXXX to NGI hereunder.
I. ADDITIONAL COVENANTS.
Between the date hereof and the Closing Date, except with the prior
written consent of XXXX, NGI shall cause CMA to:
1. CONDUCT BUSINESS AS USUAL: CMA shall conduct its business only in
the usual and ordinary course and the character of such business
shall not be changed nor any different business be undertaken
without the written consent of XXXX.
2. NGI TO MAINTAIN CURRENT CAPITAL STRUCTURE: No change shall be
made in the authorized or issued capital stock of CMA without the
written consent of XXXX.
3. AVOID SPECIAL SETTLEMENTS: CMA shall not discharge or satisfy any
lien or encumbrance or obligation or liability, other than
current liabilities shown on the financial statements contained
in the CMA Disclosure Documents, and current liabilities incurred
since that date in the ordinary course of business.
4. AVOID DISTRIBUTIONS: CMA shall not make any payment or
distribution to its stockholders or purchase for cash or redeem
any of its shares of capital stock.
5. AVOID ENCUMBRANCE OR CANCELLATION OF DEBT: CMA shall not
mortgage, pledge, or subject to lien or encumbrance any of its
assets, tangible or intangible not in the ordinary course of
business. CMA shall not cancel any debts or claims or waive any
rights not in the ordinary course of business.
6. PROVIDE ADDITIONAL INFORMATION: CMA and the officers of CMA will
agree that after the Closing, they will continue to xxxxxxx XXXX
with such additional documentation and information regarding CMA
as is reasonably requested.
J. DOCUMENTS AT CLOSING.
At the Closing the following transactions shall occur, all of such
shall transactions being deemed to occur simultaneously:
1. ACTION BY NGI. NGI will deliver, or cause the following to be
delivered to XXXX through escrow:
2. Stock certificate(s) for the CMA Shares to be issued to XXXX
pursuant to this Agreement together with such good and sufficient
stock powers, and other good and sufficient instruments of sale,
conveyance, transfer, and assignment, in form and substance
satisfactory to NONA's counsel, as shall be required or as may be
appropriate in order to effectively vest in XXXX good,
indefeasible, and marketable title to the CMA shares free and
clear of all liens and encumbrances of every nature;
3. A certificate executed by the NGI to the effect that all
representations and warranties made by NGI under this Agreement
are true and correct as of the Closing, the same as though
originally given to XXXX on said date;
4. A certificate dated at or about the date of the Closing to the
effect that CMA is in good standing under the laws of Utah;
5. Such other instruments, documents, and certificates, if any, as
are required to be delivered pursuant to the provisions of this
Agreement, or which may be reasonably requested by XXXX in
furtherance of the intent of this Agreement.
ACTION BY XXXX.
XXXX will deliver or cause to be delivered to NGI through escrow:
1. A check in the sum of $1,140,000 made payable to NGI;
2. An acknowledgment that $95,000 of the intercompany debt owed to
XXXX by NGI has been paid.
3. A certificate of XXXX to the effect that all representations and
warranties of XXXX made under this Agreement are reaffirmed on
the Closing Date, the same as though originally given to NGI on
said date;
4. Such other instruments and documents as are required to be
delivered pursuant to the provisions of this Agreement, or
otherwise reasonably requested by NGI.
K. MISCELLANEOUS.
FURTHER ASSURANCES. At any time and from time to time, after the
effective date, each party will execute such additional instruments and
take such action as may be reasonably requested by the other party to
confirm or perfect title to the CMA Shares transferred hereunder or
otherwise to carry out the intent and purposes of this Agreement.
1. WAIVER. Any failure on the part of any party hereto to comply
with any of its obligations, agreements, or conditions hereunder
may be waived in writing by the party to whom such compliance is
owed.
2. COSTS AND EXPENSES. Except as otherwise provided herein, all
fees, costs and expenses incurred by either party relating to
this Agreement shall be paid by the party incurring the same.
3. NOTICES. All notices and other communications hereunder shall be
in writing and shall be deemed to have been given if delivered in
person or sent by prepaid first class registered or certified
mail, return receipt requested to the parties hereto, or their
designees, as follows:
To NGI: NuOasis Gaming Inc.
Xxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Telefax: (000) 000-0000
To XXXX: Xxxx Xxxxxxx'x XX, Inc.
Xxxx Xxxxx, Xxxxx 000
Xxxxxx, Xxxxxxxxxx 00000
Telephone: (714) 000-000 X
Telefax: (000) 000-0000
L. HEADINGS. The section and subsection headings in this Agreement are
inserted for convenience only and shall not affect in any way the meaning
or interpretation of this Agreement.
a. COUNTERPARTS. This Agreement may be executed simultaneously in two or
more counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
b. GOVERNING LAW. This Agreement was negotiated and is being contracted
for in the State of California, and shall be governed by the laws of
the State of California, notwithstanding any conflict-of-law provision
to the contrary.
c. BINDING EFFECT. This Agreement shall be binding upon the parties
hereto and inure to the benefit of the parties, their respective
belts, administrators, executors, successors, and assigns.
d. ENTIRE AGREEMENT. This Agreement contains the entire agreement between
the parties hereto and supersedes any and all prior agreements,
arrangements, or understandings between the parties relating to the
subject matter hereof. No oral understandings, statements, promises,
or inducements contrary to the terms of this Agreement exist. No
representations, warranties, covenants, or conditions, express or
implied, other than as set forth herein, have been made by any party.
e. SEVERABILITY. If any part of this Agreement is deemed to be
unenforceable the balance of the Agreement shall remain in full force
and effect.
f. FACSIMILE COUNTERPARTS. A facsimile, telecopy or other reproduction of
this Agreement may be executed by one or more parties hereto and such
executed copy may be delivered by facsimile of similar instantaneous
electronic transmission device pursuant to which the signature of or
on behalf of such party can be seen, and such execution and delivery
shall be considered valid, binding and effective for all purposes. At
the request of any party hereto, all parties agree to execute an
original of this Agreement as well as any facsimile, telecopy or other
reproduction hereof.
g. TITLE IS OF THE ESSENCE. Time is of the essence of this Agreement and
of each and every provision hereof.
IN WITNESS WHEREOF, the parties have executed this Agreement the day
and year first above written.
"XXXX"
XXXX XXXXXXX'X XX, INC.
By: /S/ XXXX X. XXXX
------------------------------------
Name: Xxxx X. Xxxx
Title: President
"NGI"
NuOASIS GAMING INC.
By: /S/ XXXXXX XXXXXXXXXX
-----------------------------------
Name: Xxxxxx Xxxxxxxxxx
Title: President
