AGREEMENT AND PLAN OF MERGER
among
LAS VEGAS GAMING, INC.
"LVGI"
LAS VEGAS TWIN, INC.
"LV TWIN"
TRIPLE WIN IN NEVADA, INC.
"TRIPLE WIN"
and
XXXXXX X. XXXXX, XX, XXXX XXXXXXXX,
XXXX X. XXXXXXXX AND XXXXXXX XXXXXXX
"Shareholders"
AGREEMENT AND PLAN OF MERGER
--------------------------------
THIS AGREEMENT AND PLAN OF MERGER (the "Agreement") is entered into
effective as of the 30th day of April, 2003, by and among LAS VEGAS GAMING,
INC., a Nevada corporation ("LVGI"), LAS VEGAS TWIN, INC., a Nevada corporation
("LV TWIN"), TRIPLE WIN IN NEVADA, INC., a Nevada corporation ("TRIPLE WIN") and
XXXXXX X. XXXXX, XX, XXXX XXXXXXXX, XXXX X. XXXXXXXX AND XXXXXXX XXXXXXX, all
the shareholders of TRIPLE WIN ("Shareholders").
R E C I T A L S:
-----------------------
WHEREAS, the parties believe that a business combination between TRIPLE WIN
and the LV TWIN is in the best interest of the parties to this Agreement and
their respective stockholders; and
WHEREAS, the respective Boards of Directors and shareholders of the parties
have approved, or will meet to consider and approve, the merger of TRIPLE WIN
with and into LV TWIN, upon the terms and conditions set forth in this Agreement
and Plan of Merger and in accordance with Chapter 92A "Mergers and Exchanges of
Interest" of the Nevada Revised Statutes; and
WHEREAS, each party hereto wishes to adopt this Agreement and Plan of
Merger, together with the form of Certificate of Merger attached hereto as
Exhibit A (the "Certificate of Merger") as a "plan of reorganization" within the
meaning of Section 368(a) of the Code, and to cause the Merger to qualify as a
reorganization under the provision of Section 368(a)(1)(A) of the Code, whereby
each share of capital stock of TRIPLE WIN (the "TRIPLE WIN Common Stock") will
be canceled and whereby LV TWIN will be the surviving entity of a merger with
TRIPLE WIN.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained in this Agreement and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties, intending
to be legally bound hereby, agree as follows:
ARTICLE I. THE MERGER
1.1 The Merger. At the Effective Time (as defined in Section 1.3 hereof)
and subject to and upon the terms and conditions of this Agreement, TRIPLE WIN
will be merged with and into LV TWIN (the "Merger"). Following the Merger, LV
TWIN will continue as the surviving entity under the name "Las Vegas TWIN, Inc."
and the separate corporate existence of TRIPLE WIN will cease. (LV TWIN and
TRIPLE WIN are sometimes referred to collectively herein as the "Constituent
Companies").
1.2 Effects of the Merger. At the Effective Time, LV TWIN will be a
wholly owned subsidiary of LVGI. At the Effective Time, LV TWIN will, without
any other action,
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possess all the rights, privileges, powers and franchises, of a public as well
as of a private nature, and be subject to all the restrictions, disabilities and
duties of each of the Constituent Companies; and all rights, privileges, powers
and franchises of each of the Constituent Companies, and all property, real,
personal and mixed, and all debts due to either of the Constituent Companies on
whatever account, will be vested in LV TWIN; and all property, rights,
privileges, powers and franchises, and all and every other interest will be
thereafter as effectually the property of LV TWIN as they were of the
Constituent Companies, and the title to any real estate vested by deed or
otherwise in the Constituent Companies will not revert or be in any way impaired
by reason of the Merger; but all rights of creditors and all liens upon any
property of either of the Constituent Companies will be preserved unimpaired,
and all debts, liabilities and duties of either of the Constituent Companies
will thenceforth attach to LV TWIN, and may be enforced against it to the same
extent as if said debts, liabilities and duties had been incurred or contracted
by it.
1.3 Closing; Effective Time and Transaction Effective Date. The closing
of the Merger (the "Closing") will take place on May 7, 2003 (the "Closing
Date"), subject to satisfaction or waiver of the conditions set forth in this
Agreement, at the offices of Cane O'Xxxxx Xxxxxx, LLC, Las Vegas, NV. The
Merger will become effective at the time of the filing of the Certificates of
Merger with the office of the Secretary of State of Nevada in accordance with
the provisions of applicable law, which Certificate of Merger will be so filed
as soon as practicable after the Closing. The date and time when the Merger will
become effective shall be at such time as the Certificates of Merger are duly
filed with the Nevada Secretary of State or such later date as mutually
agreeable to the Constituent Companies and specified in the Certificate of
Merger (the "Effective Time").
1.4 Certificate of Incorporation. The Articles of Organization and Bylaws
of LV TWIN in effect immediately prior to the Effective Time will remain the
Articles of Organization and Bylaws of LV TWIN until amended in accordance with
the provisions of the applicable corporate law.
1.5 Directors and Officers. The officers and directors of LV TWIN
immediately prior to the Effective Time will, after the Effective Time, continue
to be the officers and directors of LV TWIN without change, until their
successors have been duly elected and qualified in accordance with the Articles
of Incorporation and Bylaws of LV TWIN.
ARTICLE II. STATUS AND CONVERSION OF SECURITIES;
MERGER CONSIDERATION
2.1 Conversion of Securities. At the Effective Time, each share of TRIPLE
WIN Common Stock issued and outstanding immediately prior to the Effective Time
will, by virtue of the Merger and without any action on the part of the holders
thereof, automatically be canceled, retired and extinguished, and each
outstanding share of TRIPLE WIN Common Stock will be converted into the right to
receive an aliquot portion of the Merger Consideration (as defined in Section
2.2 hereof) as described below.
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2.2 Merger Consideration.
(a) As of the Effective Time, each issued and outstanding share of TRIPLE
WIN Common Stock held by the Shareholders, comprising all of the issued and
outstanding shares of TRIPLE WIN Common Stock as of the Effective Time, will be
converted into a right to receive their agreed portion of the "Merger
Consideration". Merger Consideration shall be defined as follows: Five Hundred
and Eighty Thousand Shares (580,000) of LVGI Common Stock plus $300,000 cash,
The Merger Consideration will be distributed between the Shareholders as
follows:
In the case of Xxxxxxx Xxxxxxx, he will receive 100,000 shares of LVGI
common stock and $300,000 in cash as follows: $100,000 at closing, $100,000
within 90 days of closing, and $100,000 within 180 days of closing.
The remaining LVGI shares contained in the Merger Consideration (less the
100,000 shares distributed to Xxxxxxx Xxxxxxx) will be distributed to the three
remaining Shareholders equally.
Since, as of the Effective Time, all shares of the TRIPLE WIN Common Stock
will no longer be outstanding, will automatically be cancelled and retired, and
will cease to exist, each holder of shares of TRIPLE WIN Common Stock will cease
to have any rights with respect thereto, except the right to receive the Merger
Consideration.
2.3 Delivery of Merger Consideration. LVGI shall deliver the Merger
Consideration to each Shareholder within five (5) business days of Closing or
within five (5) business days after surrender of certificates (the
"Certificates") representing all shares of TRIPLE WIN Common Stock owned by such
individual, whichever is later. By accepting delivery of the Merger
Consideration, each such holder will be deemed to have represented to LVGI that
such stockholder has no present intention of selling or otherwise disposing of
any of its interest in the LVGI Common Stock received as part of the Merger
Consideration, except as contemplated under that certain Registration Rights
Agreement referenced in Section 2.8. Each Shareholder will also sign an
Investment Letter representing their intent as provided by Appendix A.
(1) Certificates. The Certificates shall forthwith be canceled upon
surrender. Until surrendered as contemplated by this Section 2.3, each such
Certificate shall be deemed at any time after the Effective Time to represent
only the right to receive upon such surrender that pro rata portion of the
Merger Consideration applicable thereto.
(2) No Further Ownership Rights in TRIPLE WIN Common Stock. All shares of
LVGI Common Stock issued upon the surrender for exchange of the Certificates in
accordance with the terms of this Article II shall be deemed to have been issued
(and paid) in full satisfaction of all rights pertaining to TRIPLE WIN Common
Stock theretofore
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represented by such Certificates, and there shall be no further registration or
transfer of the shares of TRIPLE WIN Common Stock after the Effective Time.
(3) No Fractional Shares. No certificates or scrip representing fractional
shares of LVGI Common Stock shall be issued upon the surrender of certificates
of TRIPLE WIN Common Stock for exchange, and such fractional share interests
will not entitle the owner thereof to vote or to any rights as a stockholder of
LVGI. Notwithstanding any other provision of this Agreement, each holder of
TRIPLE WIN Common Stock exchanged pursuant to the Merger who would otherwise
have been entitled to receive a fraction of a share of LVGI Common Stock (after
taking into account all Certificates delivered by such holder) will promptly
receive, in lieu thereof, cash (without interest) in an amount equal to such
fractional part of a share of LVGI Common Stock multiplied by $5.
(4) Lost Certificates. In the event any Certificates have been lost,
stolen or destroyed, upon the making of an affidavit of that fact, in form and
substance reasonably satisfactory to LVGI, by the person claiming such
certificate to be lost, stolen or destroyed, LVGI will issue in exchange for
such lost, stolen or destroyed Certificate the shares of LVGI Common Stock and
cash in lieu of fractional shares, deliverable in respect thereof pursuant to
this Agreement.
2.4 Cancellation of Treasury Shares. Any authorized but unissued shares
of TRIPLE WIN Common Stock as of the Effective Time shall automatically be
canceled and retired and shall cease to exist, and no LVGI Common Stock, cash or
other consideration will be delivered in exchange therefore.
2.5 Securities Exemptions. LVGI hereby represents, warrants and covenants
that all the shares of LVGI Common Stock comprising the Merger Consideration
will be issued pursuant to an exemption from registration provided by Section
4(2) of the Securities Act of 1933, as amended (the "Securities Act"). Each
share certificate representing the LVGI Common Stock so issued will be endorsed
with a legend stating that the shares have been issued pursuant to an exemption
from registration provided by the Securities Act and may not be sold without an
exemption from registration or an effective registration statement.
2.6 Registration Rights. LVGI agrees that it will include the Merger
Consideration Shares issued hereby in any registration statement for common
stock it files with the Securities and Exchange Commission within the next two
years.
2.7. Demand Registration Rights.
2.7.1. Registration of Merger Consideration Shares. If the Merger
Consideration Shares have not been registered or have otherwise had their
restrictions lifted due to section 144K of the securities act or otherwise, or
have been transferred on
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or before May 1, 2005 LVGI shall prepare and file a Registration Statement under
the federal securities laws (the Registration Statement@) covering the resale of
the Merger Consideration Shares by the Shareholders to be made on a continuing
basis under the Securities Act. LVGI shall use its best efforts to cause the
Registration Statement to be effective on or before September 1, 2005. LVGI will
use its best efforts to keep the Registration Statement continuously effective
until the date upon which no Shareholder owns any Merger Consideration Shares or
have otherwise had their restrictions lifted due to sections 144K of the
securities act or otherwise, including, without limitation, such amendments and
post-effective amendments to the Registration Statement as may be necessary to
keep the Registration Statement effective.
2.7.2. Blue Sky Registration. If the Merger Consideration Shares have
not been registered or have otherwise had their restrictions lifted due to
section 144K of the securities act or otherwise, or have been transferred on or
before May 1, 2005 LVGI will use its reasonable best efforts to register or
qualify the Merger Consideration Shares under the securities or Ablue sky@ laws
of any such jurisdictions in the United States as the Shareholders reasonably
request in writing, and do any and all other acts or things necessary or
advisable to enable the disposition of the LVGI stock in such jurisdictions.
2.7.3. Exchange Listings. If the Merger Consideration Shares have not
been registered or have otherwise had their restrictions lifted due to section
144K of the securities act or otherwise, or have been transferred on or before
May 1, 2005 LVGI shall from time to time following registration under 2.7.1 take
all action which may be necessary so that the Merger Consideration Shares will
be listed on the principal securities exchanges, automated quotation systems or
other markets within the United States, if any, on which other shares of LVGI
stock art then listed, if any.
2.7.4. Right to Inspect. LVGI shall make available, at reasonable
times, for inspection by the Shareholders or any one of them or their
representatives, all financial and other pertinent corporate documents and
records of LVGI, to the extent such information relates to the Registration
Statement or any post-effective amendment thereto.
2.7.5. Expenses. All costs, fees and expenses incident to LVGI=s
performance of or compliance with this Agreement shall be borne by LVGI.
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ARTICLE III REPRESENTATIONS AND WARRANTIES OF SHAREHOLDERS AND TRIPLE WIN
As an inducement to the other parties hereto to enter into this Agreement
and to consummate the Merger, Shareholders and Triple Win jointly and severely
represent and warrant to each other party, which representations and warranties
will be true and correct at Closing, as follows.
3.1 Organization and Authority. TRIPLE WIN is a corporation duly
organized, validly existing and in good standing in the State of Nevada, and is
not required to be duly qualified to do business as foreign corporation in any
other jurisdiction. Since the date of its organization and incorporation,
TRIPLE WIN has consistently observed and operated within the corporate
formalities of the jurisdiction in which it is incorporated, and has
consistently observed and complied with the general corporation law of such
jurisdiction. TRIPLE WIN has the full right, power and authority to execute,
deliver and carry out the terms of this Agreement and all documents and
agreements necessary to give effect to the provisions of this Agreement. This
Agreement and all other such agreements and documents executed in connection
herewith by TRIPLE WIN, upon due execution and delivery thereof, will constitute
the valid and binding obligations of TRIPLE WIN, enforceable in accordance with
their respective terms, except as enforcement may be limited by bankruptcy,
insolvency, reorganization or similar laws effecting creditors' rights generally
and by general principles of equity (the "Insolvency/Equity Exceptions"). The
authorized capital stock of TRIPLE WIN consists of 1,000 shares of $0.01 par
value common stock. There are currently 1,000 shares of TRIPLE WIN Common Stock
issued and outstanding, which represents all of the TRIPLE WIN securities
(including options, warrants and other types of securities) issued and
outstanding as of the date of closing. The TRIPLE WIN Common Stock is subject to
preemptive or comparable rights and has been issued in accordance with all
applicable federal and state securities laws.
There are no voting trusts, voting agreements, shareholders' agreements or
other comparable commitments or understandings to which Shareholders are a party
or by which Shareholders are bound with respect to the voting of any
Shareholders' Stock or capital stock of any other TRIPLE WIN Subsidiary, other
than a Stock Repurchase Agreement.
TRIPLE WIN does not have any outstanding subscriptions, options, preferred
stock, rights, warrants, convertible securities or other agreements or
commitments to issue, or contracts or any other agreements obligating TRIPLE WIN
to issue, or to transfer from treasury, any shares of its capital stock or
membership interests, as applicable, of any class or kind, or securities
convertible into such stock or interests. No persons who are now holders of
Company Stock, and no persons who previously were holders of Company Stock, are
or ever were entitled to exercise preemptive rights other than persons who
exercised or waived those rights.
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Neither TRIPLE WIN nor any of its Affiliates, is under any obligation,
contract or other arrangement to register (or maintain the registration of) any
of its or their securities under federal or state securities laws.
Neither TRIPLE WIN nor the Shareholders is a party to any agreement, voting
trust, proxy or other agreement or understanding of any character, whether
written or oral, with any other stockholders of TRIPLE WIN with respect to or
concerning the purchase, sale or transfer or voting of TRIPLE WIN Stock or any
other security of TRIPLE WIN, other than a Stock Repurchase Agreement.
Neither TRIPLE WIN nor the Shareholders has any legal obligations, absolute
or contingent, to any other person or entity to sell the assets other than in
the ordinary course of business, or any capital stock or any other security of
TRIPLE WIN or any of its subsidiaries or affect any merger, consolidation or
other reorganization of TRIPLE WIN or any of its subsidiaries or to enter into
any agreement with respect thereto, except pursuant to this Agreement and as
provided by the Stock Repurchase Agreement.
(a) Subsidiaries. TRIPLE WIN does not have any subsidiaries (whether
held directly or indirectly) or any equity investment in any corporation,
partnership, joint venture or other business.
(b) Real Estate. TRIPLE WIN does not own any real estate or any
interest in any real estate, other than leasehold interests.
(c) Authority Relative to the Closing Documents; Enforceability.
Neither the Shareholders nor TRIPLE WIN are suffering from any legal disability
which would: (a) prevent them from executing, delivering or performing their
obligations under the Closing Documents or consummating the Transaction, (b)
make such execution, delivery, performance or consummation voidable or subject
to necessary ratification, and (c) require the signature or consent of any third
party in connection therewith for the Transaction to be binding and enforceable
against the Shareholders and their property. The Closing Documents have been
duly and validly executed and delivered by the Shareholders and each constitutes
the legal, valid and binding obligation of the Shareholders, enforceable against
them in accordance with their respective terms, except insofar as the
enforcement thereof may be limited by the Insolvency/Equity Exceptions.
(d) Title to Assets. TRIPLE WIN has good and marketable title free and
clear of any encumbrance in and to all of its assets and properties, other than
purchase money security interests and liens for taxes not yet due and payable.
(e) Material Contracts. Except as disclosed to Shareholder, TRIPLE WIN
is not a party to or bound by any agreement or contract, other than contracts or
agreements arising in the ordinary course of business.
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(f) Compliance with Other Instruments; Consents. Neither the execution
of any Closing Document nor the consummation of the Transaction will conflict
with, violate or result in a breach or constitute a default (or an event which,
with notice or lapse of time or both, would constitute a default), or result in
a termination of, or accelerate the performance required by, or result in the
creation of any encumbrance upon any assets of TRIPLE WIN under any provision of
the Articles of Incorporation, Bylaws, indenture, mortgage, lien, lease,
agreement, contract, instrument, order, judgment, decree, statute, ordinance,
regulation or any other restriction of any kind or character to which TRIPLE WIN
is bound.
(g) Litigation. There are no legal, administrative, arbitration or
other proceedings or claims pending against TRIPLE WIN, nor is TRIPLE WIN
subject to any existing judgment which might affect the financial condition,
business, property or prospects of TRIPLE WIN; nor has TRIPLE WIN received any
inquiry from an agency of the federal or of any state or local government about
the Transaction, or about any violation or possible violation of any law,
regulation or ordinance affecting its business or assets.
(h) Taxes. TRIPLE WIN either: (a) has timely filed with the
appropriate taxing authority all Tax and information returns required to have
been filed by TRIPLE WIN or (b) has timely filed for any required extensions
with regard to such returns. All Taxes of TRIPLE WIN have been paid (or
estimated Taxes have been deposited) to the extent such payments are required
prior to the date hereof or accrued on the books of TRIPLE WIN. The returns were
correct when filed. There are no pending investigations of TRIPLE WIN
concerning any Tax returns by any federal, state or local Taxing authority, and
there are no federal, state, local or foreign Tax liens upon any of TRIPLE WIN's
assets.
(i) Compliance with Law and Government Regulations. TRIPLE WIN has
complied in all material respects with, and is not in substantial violation of,
applicable federal, state, local or foreign statutes, laws and regulations
(including without limitation, any applicable environmental, building, zoning or
other law, ordinance or regulation) affecting TRIPLE WIN or its properties or
the operation of its business. TRIPLE WIN is not subject to any order, decree,
judgment or other sanction of any court, administrative agency or other
tribunal.
(j) Full Disclosure. None of the representations and warranties made
by the Shareholders herein, or in any Closing Document furnished or to be
furnished by them hereunder contain or will contain as of the closing date any
untrue statement of material fact, or omits any material fact, the omission of
which would be misleading.
3.2 Absence of Default. The execution, delivery and consummation of this
Agreement, and all other agreements and documents executed in connection
herewith by TRIPLE WIN and Shareholders will not constitute a violation of, be
in conflict with, or, with or without the giving of notice or the passage of
time, or both, result in a breach of, constitute a default under, or create (or
cause the acceleration of the maturity of) any debt, indenture, obligation or
liability or result in the creation or imposition of any security
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interest, lien, charge or other encumbrance upon any of the assets of TRIPLE WIN
under: (a) any term or provision of the Certificate of Incorporation or Bylaws
of TRIPLE WIN; (b) any contract, lease, purchase order, agreement, document or
other commitment, oral or written, to which TRIPLE WIN is a party or by which
TRIPLE WIN is bound; (c) any judgment, decree, order, writ, injunction or rule
of any court or regulatory authority; or (d), to the knowledge of TRIPLE WIN,
any law, statute, rule or regulation to which TRIPLE WIN is subject.
3.3 Broker's or Finder's Fee. TRIPLE WIN has not employed, and is not
liable for the payment of any fee to, any finder, broker or similar person in
connection with the transactions contemplated under this Agreement.
ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF LVGI
AND LV TWIN
As an inducement to the other parties hereto to enter into this Agreement
and to consummate the Merger, and as an inducement to the Shareholders to
approve of and consummate the Merger, LVGI hereby represents and warrants to
each such party, which representations and warranties will be true and correct
at Closing, as follows.
4.1 Organization, Qualification and Authority. LVGI is a corporation
duly organized, validly existing and in good standing in the State of Nevada,
and is not required to be qualified to do business as a foreign corporation in
any other jurisdiction. Since the date of its organization and incorporation or
formation, LVGI has consistently observed and operated within the corporate
formalities of the jurisdictions in which it is organized and/or conducts its
business, has consistently observed and complied with the general corporation
law of such jurisdictions and has been duly qualified to do business as a
foreign corporation in all relevant jurisdictions. All outstanding shares of
capital stock of the LVGI Subsidiaries consist solely of common stock and have
been validly issued in accordance with all applicable federal and state
securities laws and are owned by LVGI free and clear of all liens, charges,
encumbrances, claims and options of any nature. LVGI has the full right, power
and authority to own, lease and operate its properties and assets as presently
owned, leased and operated and to carry on its business as it is now being
conducted. LVGI has the full right, power and authority to execute, deliver and
carry out the terms of this Agreement and all documents and agreements necessary
to give effect to the provisions of this Agreement, to consummate the
transactions contemplated on the part of LVGI hereby, and to take all actions
necessary to permit or approve the actions LVGI take in connection with this
Agreement. Subject to obtaining requisite approval of the shareholders of LVGI,
the execution, delivery and consummation of this Agreement and all other
agreements and documents executed in connection herewith by LVGI have been duly
authorized by all necessary corporate action on the part of LVGI. No other
action on the part of LVGI, or any other person or entity other than LVGI as its
sole shareholder, is necessary to authorize the execution, delivery and
consummation of this Agreement and all other agreements and documents executed
in connection herewith,
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other than such shareholder approval. This Agreement and all other agreements
and documents executed in connection herewith by LVGI, upon due execution and
delivery thereof, will constitute the valid and binding obligations of LVGI,
enforceable in accordance with their respective terms, except as enforcement may
be limited by bankruptcy, insolvency, reorganization or similar laws affecting
creditors' rights generally and by general principles of equity.
(a) Real Estate. LV TWIN and LVGI do not own any real estate or any
interest in any real estate, except as disclosed in the SEC Documents.
(b) Authority Relative to the Closing Documents; Enforceability. LV TWIN
and LVGI are not suffering from any legal disability which would: (a) prevent it
from executing, delivering or performing its obligations under the Closing
Documents or consummating the Transaction, (b) make such execution, delivery,
performance or consummation voidable or subject to necessary ratification, and
(c) require the signature or consent of any third party in connection therewith
for the Transaction to be binding and enforceable against LV TWIN and LVGI and
their property. The Closing Documents have been duly and validly executed and
delivered and each constitutes the legal, valid and binding obligation,
enforceable against LV TWIN and LVGI in accordance with their respective terms,
except insofar as the enforcement thereof may be limited by law.
(c) Compliance with Other Instruments; Consents. Neither the execution of
any Closing Document nor the consummation of the Transaction will conflict with,
violate or result in a breach or constitute a default (or an event which, with
notice or lapse of time or both, would constitute a default), or result in a
termination of, or accelerate the performance required by, or result in the
creation of any encumbrance upon any assets of LV TWIN or LVGI under any
provision of the Articles of Incorporation, Bylaws, indenture, mortgage, lien,
lease, agreement, contract, instrument, order, judgment, decree, statute,
ordinance, regulation or any other restriction of any kind or character to which
LV TWIN or LVGI are bound.
(d) Financial Statements. LVGI's audited financial statements for the year
ended December 31, 2002, copies of which have been delivered to LV TWIN and the
Shareholders, are true and complete in all material respects, and have been
prepared in accordance with GAAP for the period covered by such statements, and
fairly present, in accordance with GAAP, the properties, assets and financial
condition of LVGI, and results of its operations as of the dates and for the
periods covered thereby. Except as may be disclosed in the SEC Documents, there
has been no material adverse change in the business operations, assets,
properties, prospects or condition (financial or otherwise) of LVGI, taken as a
whole, from that reflected in the LVGI Financial Statements.
(e) Litigation. There are no material legal, administrative, arbitration or
other proceedings or claims pending against LV TWIN OR LVGI, nor is LV TWIN OR
LVGI subject to any existing judgment which might affect the financial
condition, business,
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property or prospects of LV TWIN OR LVGI; nor has LV TWIN OR LVGI received any
inquiry from an agency of the federal or of any state or local government about
the Transaction, or about any violation or possible violation of any law,
regulation or ordinance affecting its business or assets. On March 24, 2003, a
civil action was brought in the US District Court for the District of Nevada
against LVGI and others for patent violation by Planet Bingo, LLC. Management of
LVGI is currently evaluating this action for materiality, but notes that even
frivolous patent lawsuits can be prohibitively expensive to defend and thus can
have a material effect on the business and operations of the Company.
LVGI is not a party to any other legal proceedings and to the Company's
knowledge no such proceedings are threatened or contemplated.
(f) SEC Documents. LVGI has furnished or made available to TRIPLE WIN and
Shareholders a true and complete copy of each report, schedule, registration
statement and proxy statement filed by LVGI with the SEC (as such documents have
since the time of their filing been amended, the "SEC Documents"). LVGI has
timely filed with the SEC all documents required to have been filed pursuant to
the Securities Act and the Exchange Act. As of their respective dates, the SEC
Documents complied in all material respects with the requirements of the
Securities Act, or the Exchange Act, as the case may be, and the rules and
regulations of the SEC thereunder applicable to such SEC Documents, and none of
the SEC Documents contained any untrue statement of a material fact or omitted
to state a material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading.
(g) Taxes. LV TWIN and LVGI have either: (a) timely filed with the
appropriate taxing authority all Tax and information returns required to have
been filed by LV TWIN or (b) timely filed for any required extensions with
regard to such returns. All Taxes of LV TWIN and LVGI have been paid (or
estimated Taxes have been deposited) to the extent such payments are required
prior to the date hereof or accrued on the books of LV TWIN and LVGI. The
returns were correct when filed. There are no pending investigations of LV TWIN
or LVGI concerning any Tax returns by any federal, state or local Taxing
authority, and there are no federal, state, local or foreign Tax liens upon any
of LV TWIN's or LVGI's assets.
(h) Compliance with Law and Government Regulations. LV TWIN and LVGI have
complied in all material respects and are not in material violation of,
applicable federal, state, local or foreign statutes, laws and regulations
(including without limitation, any applicable environmental, building, zoning or
other law, ordinance or regulation) affecting LV TWIN or LVGI or the operation
of their businesses. Neither LVGI or LV TWIN is subject to any order, decree,
judgment or other sanction of any court, administrative agency or other
tribunal.
(i) Full Disclosure. None of the representations and warranties made by LV
TWIN or LVGI herein, or in any Closing Document furnished or to be furnished by
them
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hereunder contain or will contain as of the Closing Date any untrue statement of
material fact, or omits any material fact, the omission of which would be
misleading.
4.2 Capitalization and Stock Ownership.
(1) Common Stock. The authorized capital stock of LVGI (the "LVGI Common
Stock") consists of 25,000,000 shares of common stock, par value $0.001 per
share, of which 5,845,855 shares are issued and outstanding and 5,000,000 shares
of preferred stock of which 541,400 shares of Series A preferred shares are
outstanding as of the date hereof. The authorized capital stock of LV TWIN (the
"LV TWIN Common Stock") consists of 200,000,000 shares of common stock, par
value $0.001 per share, of which 1,000 shares are issued and outstanding. The LV
TWIN Common Stock constitutes all current issued and outstanding securities of
LV TWIN, and are duly authorized, validly issued, fully paid and non-assessable.
The LVGI and LV TWIN Common Stock is not subject to preemptive or comparable
rights. The LVGI and LV TWIN Common Stock and all other currently or previously
outstanding securities of LVGI and LV TWIN have been issued in accordance with
all applicable federal, state and foreign securities laws. LVGI is the sole
owner of all of the issued and outstanding shares of LV TWIN.
(2) Other Securities. As of the date hereof, LVGI has issued certain
warrants and options all as more particularly described in its filings with the
Securities and Exchange Commission.
(3) Related Agreements. There are no voting trusts, voting agreements,
shareholders' or other comparable commitments or understandings, oral or
written, to which LVGI or LV TWIN or any holder of LVGI securities is a party or
by which LVGI or any such holder is bound with respect to the voting of any LVGI
Common Stock or preferred or the capital stock or securities of any LVGI
Subsidiary.
(4) LVGI Common Stock. On the Closing Date, LVGI will have a sufficient
number of authorized but un-issued and/or treasury shares of LVGI Common Stock
available for issuance to the Shareholders in accordance with the provisions of
this Agreement. The LVGI Common Stock to be issued as Merger Consideration
pursuant to the Agreement will, when so delivered, be duly and validly issued in
accordance with all applicable federal and state securities laws, will be exempt
from registration requirements of the 1933 Act and state "blue sky" laws, will
be fully paid and non-assessable, and will be free and clear of preemptive or
comparable rights.
4.3 Absence of Default. The execution, delivery and consummation of this
Agreement, and all other agreements and documents executed in connection
herewith by LV TWIN and LVGI will not constitute a violation of, be in conflict
with, or, with or without the giving of notice or the passage of time, or both,
result in a breach of, constitute a default under, or create (or cause the
acceleration of the maturity of) any debt, indenture, obligation or liability or
result in the creation or imposition of any security interest, lien,
Page 13
charge or other encumbrance upon any of the assets of LV TWIN OR LVGI under: (a)
any term or provision of the Charter or Bylaws of LV TWIN OR LVGI; (b) any
material contract, lease, purchase order, agreement, document or other
commitment, oral or written, to which LV TWIN OR LVGI is a party or by which LV
TWIN OR LVGI is bound (collectively the "LV TWIN Contracts") (for purposes of
categorizing contracts, "material" being defined to exclude any contract, lease,
purchase order, agreement, document or commitment which both (y) in terms of
payments, costs, services or other measure does not exceed $10,000.00 in the
aggregate and (z) is terminable without penalty upon ninety (90) days' written
notice or less or (c), to the knowledge of LV TWIN OR LVGI, any law, statute,
rule or regulation to which LV TWIN OR LVGI is subject.
Page 14
ARTICLE V. COVENANTS OF PARTIES
5.1 Preservation of Business and Assets. From the date hereof until the
Closing, each party will use its best efforts and will do or cause to be done
all such acts and things as may be necessary to preserve, protect and maintain
intact the operation of its respective business and assets as a going concern
consistent with prior practice and not other than in the ordinary course of
business, including preserving, protecting and maintaining the goodwill of the
suppliers, employees, clientele and others having business relations with such
party. Each party will use its best efforts to retain its employees in their
current positions up to Closing. Through Closing, no party will acquire or sell
or agree to acquire or sell by merging or consolidating with, or by purchasing
or selling a substantial equity interest in or a substantial portion of the
assets of, or by any other manner, any business or any corporation, partnership,
association or other business organization or division thereof. Except as
expressly set forth in this Agreement or any related Agreement, the execution,
delivery and consummation of this Agreement and the transactions contemplated
hereunder will not give rise to any obligation of any party hereto, or any right
of any holder of any security of any party hereto to require such party, to
purchase, offer to purchase, redeem or otherwise prepay or repay any capital
stock or other security, or deposit any funds to affect the same. All parties
will use their best efforts to facilitate the consummation of the Merger as
contemplated hereunder, including obtaining requisite approval of stockholders
and third parties. Through Closing, except as expressly set forth in this
Agreement or related Agreements and except for exercise of any outstanding LVGI
Warrants, LVGI Options or LVGI preferred stock, no party will issue, deliver or
sell, or authorize or propose to issue, deliver or sell, any shares of its
capital stock of any class, any voting securities or any securities convertible
into, or any rights, warrants or options to acquire, any such shares, voting
securities or convertible securities. Through Closing, no party will split,
combine or reclassify any of its capital stock or issue or authorize or propose
the issuance of any other securities in respect of, in lieu of or in
substitution for shares of its capital stock, or repurchase, redeem or otherwise
acquire any shares of its capital stock. From the date hereof until the Closing,
no party will pay any dividend or distribution to its stockholders as such, and
no party will sell, discard or dispose of any of its assets, other than in the
ordinary course of business.
5.2 Absence of Material Change. From the date hereof until the Closing,
no party will make any change in its business or in the utilization of its
assets and will not enter into any contract or commitment or any other
transaction with respect to its business or its assets which is contrary to its
representations, warranties and obligations as set forth in this Agreement.
5.3 Material Transactions. Except as contemplated by this Agreement,
prior to the Effective Time, each party hereto, including its respective
subsidiaries, if any, will not, without first obtaining the written consent of
the other parties hereto:
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(1) dispose of or encumber any asset or enter into any transaction or make
any contract commitment relating to the properties, assets and business of such
entity, other than in the ordinary course of business or as otherwise disclosed
herein;
(2) enter into any employment contract which is not at will or terminable
upon notice of thirty (30) days or less, without penalty;
(3) enter into any contract or agreement (i) which cannot be performed
within three months or less, or (ii) which involves the expenditure of over
$10,000.00;
(4) except as otherwise stated, issue or sell, or agree to issue or sell,
any shares of capital stock or other securities of such entity;
(5) make any payment or distribution under any bonus, pension,
profit-sharing or retirement plan or incur any obligation to make any such
payment which is not in accordance with such entities usual past practice, or
make any payment or incur any obligation pursuant to or in respect of any other
plan or contract or arrangement providing for bonuses (other than pursuant to
normal past practices), executive incentive compensation, pensions, deferred
compensation, retirement payments, profit-sharing or the like, establish or
enter into any such plan, contract or arrangement, or terminate any plan;
(6) extend credit to anyone except in the ordinary course of business
consistent with prior practice;
(7) guarantee the obligation of any person, firm or corporation;
(8) amend its operating agreement, charter or bylaws, or applicable
organizational documents;
(9) set aside or pay any cash dividend or any other distribution on or in
respect of its capital stock or any redemption, retirement or purchase with
respect to its capital stock or issue any additional shares of its capital
stock; or engage in any stock split, recapitalization, reorganization or
comparable transaction;
(10) discharge or satisfy any lien, charge, encumbrance or indebtedness
outside the ordinary course of business;
(11) institute, settle or agree to settle any litigation, action or
proceeding before any court or governmental body;
(12) authorize any compensation increase of any kind whatsoever for any
employee, consultant or other representative; or
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(13) engage in any extraordinary transaction.
5.4 Certain Tax Matters.
(1) During the period from the date hereof through the Effective Time, no
party will knowingly or negligently take or fail to take any action that would
jeopardize the treatment of the Merger as a "reorganization" within the meaning
of Section 368(a)(1)(A) of the Code (and any comparable provisions of applicable
state law). Each party hereto shall report the Merger, and the exchange of
stock, as a reorganization under Section 368(a) of the Code, and shall not take
any position inconsistent with this characterization except in the event of a
contrary final determination of the Internal Revenue Service. If any party
receives notice of any contrary position by the Internal Revenue Service any
party hereto may, at its option and sole expense, contest such position, in
which event the other parties hereto shall cooperate with such contest as
reasonably requested by the contesting party.
(2) Except as provided below, each party hereto shall provide to the other
parties, at the expense of the requesting party, with such assistance as may
reasonably be requested by any of them in connection with the preparation of any
tax return, any audit or other examination by any regulatory authority, or any
judicial or administrative proceedings relating to liability for taxes, and each
party will retain and provide the requesting party(ies) with any records or
information that may be relevant to any of the foregoing.
(3) The Shareholders agree to ensure that all taxes owed for activities of
TRIPLE WIN prior to the Effective Date are paid to the appropriate taxing
authority and hereby agree to indemnify LV TWIN and LVGI from any such
obligation. The Shareholders shall cause the preparation of a final income tax
return for the period ending on the Effective Time, provided, however, that LV
Twin and LVGI shall make available to Shareholders and their agents, without
cost, copies of such information as shall be reasonably necessary to prepare
such tax returns. LVGI and LV TWIN agree that on January 5, 2004 they will pay
each Shareholder in cash 25% of an amount calculated as follows: the taxable
income of Triple Win from the period January 1, 2003 through April 30, 2003
multiplied by 35%.
5.5 Legal Conditions to Merger. Each party hereto will take all
reasonable actions necessary to comply promptly with all legal requirements
which may be imposed on it with respect to the Merger and will promptly
cooperate with and furnish information to each other party in connection with
any such requirements imposed upon either any of them in connection with the
Merger.
5.6 Preserve Accuracy of Representations and Warranties. Each party
hereto will refrain from taking any action which would render any of its
representations and warranties contained in this Agreement untrue, inaccurate or
misleading as of Closing and the Effective Time. Through Closing, each party
will promptly notify the other parties of any lawsuit, claim, audit,
investigation, administrative action or other proceeding asserted or
Page 17
commenced against such party that may involve or relate in any way to another
party to this Agreement. Each party hereto will promptly notify the other
parties of any facts or circumstances that come to its attention and that cause,
or through the passage of time may cause, any of a party's representations,
warranties or covenants to be untrue or misleading at any time from the date
hereof through Closing, and such notification will be deemed to update such
warranty and representation so that by such notification it shall be deemed to
be true and accurate.
5.7 Notice of Subsequent Events. Each party hereto shall notify the other
parties of any changes, additions or events of which it has knowledge which
would cause any material change in this Agreement (including but not limited to
the Exhibits attached hereto and thereto) promptly after occurrence of the same.
If the effect of such change or addition would, individually or in the aggregate
with the effect of changes or additions previously disclosed pursuant to this
Section, constitute a material adverse effect on the notifying party, any
non-notifying party may, within ten (10) days after receipt of such notice,
elect to terminate this Agreement. If no non-notifying party gives written
notice of such termination with such 10-day period, the non-notifying parties
shall be deemed to have consented to such change or addition and shall not be
entitled to terminate this Agreement by reason thereof.
5.8 Current Return Filing. Each party will be responsible for the reparation
and filing of all of such party's own tax returns which were due on or before
the Closing, and the payment of all taxes due.
5.9 Maintain Books and Accounting Practices. From the date hereof until
the Closing, each party will maintain its books of account in the usual, regular
and ordinary manner on a basis consistent with prior years and will make no
change in its accounting methods or practices.
5.10 Compliance with Laws and Regulatory Consents. From the date hereof
until the Closing, (a) each party will comply with all applicable statutes,
laws, ordinances and regulations, (b) each party will keep, hold and maintain
all licenses, (c) each party will use its reasonable efforts and will cooperate
fully with the other parties hereto to obtain all consents, stockholder and
other approvals, exemptions and authorizations of third parties, whether
governmental or private, necessary to consummate the Merger, and (d) each party
will make and cause to be made all filings and give and cause to be given all
notices which may be necessary or desirable on their part under all applicable
laws and under their respective contracts, agreements and commitments in order
to consummate the Merger.
5.11 Maintain Insurance Coverage. From the date hereof until the Closing,
each party will maintain and cause to be maintained in full force and effect all
its currently existing insurance on such party's assets and the operations of
such party's business and will provide at Closing written evidence satisfactory
to each other parties that such insurance continues to be in effect, that all
premiums due have been paid.
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5.12 Closing Deliveries. At Closing, the parties hereto will deliver or
cause to be delivered the following, fully executed and in form and substance
reasonably satisfactory to the receiving party(ies):
(a) Deliveries by the LV TWIN. LV TWIN hereby agrees to deliver, or
cause to be delivered, to Shareholders and TRIPLE WIN the following items on
Closing:
(1) Certified Resolutions. Copies of the resolutions, certified by an
officer of LV TWIN and the Board of Directors of LV TWIN approving the
terms of this Agreement for purposes of Nev. Rev. Stat. Sec. 78.438(1) and
78.378 - 78.3793.
(2) Cash. The payment of $100,000 to Xxxxxxx Xxxxxxx by wire transfer
as required herein.
(3) Transfer Agent Direction. A direction of LVGI to its transfer
agent to issue the Merger Consideration Shares in the name of the
Shareholders with a restrictive legend or as is otherwise required by law.
(b) Deliveries by Shareholders and TRIPLE WIN. Shareholders and TRIPLE WIN
hereby agrees to deliver to LV TWIN the following items upon Closing:
(1) Certified Resolutions. Copies of the resolutions, certified by an
officer of TRIPLE WIN, of the Board of Directors of TRIPLE WIN approving
the terms of this Agreement, and a copy of the resolution of the
shareholders of TRIPLE WIN approving the transaction.
(2) Stock Certificates. A stock certificate or certificates
representing all the TRIPLE WIN Shares, together with such stock powers and
all other documentation required by LV TWIN.
(3) Investment Letter. The Investment Letter, executed by the
Shareholders.
(4) Non-Compete. A Non-Compete signed by each of the Shareholders
covering the gaming business conducted by TRIPLE WIN for a period of 2
years as provided by Appendix B.
ARTICLE VI.
CONDITIONS TO CLOSING
6.1 Conditions to Each Party's Obligation to Effect the Merger. The
obligation of each party hereto to effect the Merger shall be subject to the
fulfillment at or prior to the Closing of the following conditions:
Page 19
(1) This Agreement and the transactions contemplated hereunder shall have
been approved by shareholder of LV TWIN in the manner required by the applicable
laws of the State of Nevada and the Charter and Bylaws of LV TWIN. Further, the
Shareholders will have executed and delivered such documents and performed such
acts as reasonably required to effectuate the Merger.
(2) Each party hereto shall have received from the other parties copies of
all resolutions and/or consent actions adopted by or on behalf of the boards of
directors and shareholders of such other parties hereto, certified as of the
date of Closing and evidencing approval of this Agreement and the transactions
contemplated hereunder.
(3) No action or proceeding before a court or other governmental body by
any governmental agency or public authority shall have been instituted or
threatened to restrain or prohibit the transactions contemplated under this
Agreement or to obtain an amount of damages or other material relief in
connection with the execution of this Agreement or any related agreements or the
consummation of the Merger; and no governmental agency shall have given notice
to any party hereto to the effect that consummation of the transactions
contemplated under this Agreement would constitute a violation of any law or
that it intends to commence proceedings to restrain consummation of the Merger.
(4) All consents, authorizations, orders and approvals of (or filings or
registrations with) any governmental commission, board or other regulatory body
or any other third party (including lenders and lessors) required in connection
with the execu-tion, delivery and performance of this Agreement shall have been
obtained or made.
(5) The warranties and representations set forth herein shall be true
and correct as of the Closing Date.
ARTICLE VII.
TERMINATION; AMENDMENT; EXTENSION AND WAIVER
7.1 Termination by Mutual Consent. This Agreement may be terminated and
the Merger may be abandoned at any time prior to the Effective Time, before or
after the approval of this Agreement by the shareholders of TRIPLE WIN and/or
LVGI, by the mutual consent of the Boards of Directors of TRIPLE WIN and LVGI.
7.2 Termination by Certain Parties. This Agreement may be terminated
and the Merger may be abandoned by action of the Board of Directors of TRIPLE
WIN or LVGI if (a) the Merger shall not have been consummated by May 31, 2003,
or (b) a United States federal or state court of competent jurisdiction or
United States federal or state governmental, regulatory or administrative agency
or commission shall have issued an order, decree or ruling or taken any other
action permanently restraining, enjoining or
Page 20
otherwise prohibiting the transactions contemplated by this Agreement and such
order, decree, ruling or other action shall have become final and
non-appealable; provided, that the party seeking to terminate this Agreement
pursuant to this clause (d) shall have used all reasonable efforts to remove
such injunction, order or decree.
7.3 Effect of Termination and Abandonment. Upon termination of this
Agreement, this Agreement and all its terms (including legal opinions) related
hereto shall be void and of no force or effect, and there shall be no liability
by reason of this Agreement or the termination thereof on the part of any party
hereto, or on the part of the respective directors, officers, managers,
employees, agents, representatives or shareholders of any of them; provided that
this Section will not relieve any party from liability for damages incurred as a
result of any willful breach by such party or by an affiliate of such party of
any of its respective representations, warranties, covenants or obligations set
forth in this Agreement.
7.4 Amendment. This Agreement may be amended by the parties at any time,
provided, that any amendments requiring the approval of the LV TWIN shareholders
or the TRIPLE WIN Stockholders will not become effective until the amendment is
approved by said holders. This Agreement may not be amended except by an
instrument in writing signed on behalf of all the parties hereto.
7.5 Extension; Waiver. At any time prior to the Effective Time, any party
hereto, by action taken by its Board of Directors evidenced in writing, may, to
the extent legally allowed, (a) extend the time for the performance of any of
the obligations or other acts of the other parties hereto, (b) waive any
inaccuracies in the representations and warranties made to such party contained
herein or in any document delivered pursuant hereto, and (c) waive compliance
with any of the agreements or conditions for the benefit of such party
contained herein. If any party shall waive compliance as provided in (b) or (c)
above, the other party shall have no liability for compliance so waived. Any
agreement on the part of a party hereto to any such extension or waiver shall be
valid only if set forth in an instrument in writing signed on behalf of such
party.
ARTICLE VIII. SURVIVAL OF PROVISIONS AND INDEMNIFICATION
8.1 Survival. The covenants, obligations, representations and warranties
of each party contained in this Agreement, or in any certificate or document
delivered pursuant to this Agreement, will be deemed to be material and to have
been relied upon by the other parties notwithstanding any investigation prior to
the Closing, will not be merged into any documents delivered in connection with
the Closing, and will terminate two (2) years after Closing; provided however,
that if a notice claiming indemnity is properly delivered, the indemnification
obligations will not expire with respect to such claim(s) until the same are
resolved as contemplated hereunder.
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8.2 Indemnification by LVGI and LV TWIN. LVGI and LV TWIN shall
indemnify, defend and hold TRIPLE WIN and their officers, directors, employees,
agents and representatives, and the TRIPLE WIN Shareholders harmless against
any and all losses, costs and expenses (including reasonable cost of
investigation, court costs and reasonable legal fees actually incurred) and
other damages resulting from (a) any breach by LVGI or LV TWIN of any of their
covenants, obligations, representations or warranties or breach or untruth of
any representation, warranty, fact or conclusion contained in this Agreement or
any certificate or document of LVGI or LV TWIN delivered pursuant to this
Agreement, and (b) any claim that is brought or asserted by any third party(ies)
against the Shareholders arising out of the ownership, licensing, operation or
conduct of LV TWIN.
8.3 Indemnification by TRIPLE WIN and Shareholders. TRIPLE WIN and the
Shareholders shall indemnify, defend and hold LVGI and LV TWIN and their
respective officers, directors, employees and representatives harmless against
any and all losses, costs and expenses (including reasonable cost of
investigation, court costs and reasonable legal fees actually incurred) and
other damages resulting from (a) any breach by TRIPLE WIN or the Shareholders of
any of its covenants, obligations, representations or warranties or breach or
untruth of any representation, warranty, fact or conclusion contained in this
Agreement or any certificate or document of TRIPLE WIN or the Shareholders
delivered pursuant to this Agreement, and (b) any claim that is brought or
asserted by any third party(ies) arising out of the ownership, licensing,
operation or conduct of TRIPLE WIN through Closing, unless the same shall arise
from the failure to pay or perform any obligation of Triple Win incurred prior
to the Closing in the ordinary course of business consistent with prior
practice.
8.4 Rules Regarding Indemnification. The obligations and liabilities of
each party hereto (the "indemnifying party") which may be subject to
indemnification liability hereunder to the other party(ies) (the "indemnified
party") will be subject to the following terms and conditions:
(1) Claims by Non-Parties. The indemnified party will give written notice
to the indemnifying party, within such time as not to prejudice the indemnifying
party's ability to defend against the underlying claim, of any written claim by
a third party which is likely to give rise to a claim by the indemnified party
against the indemnifying party based on the indemnity agreements contained in
this Article, stating with reasonable specificity the nature of said claim and
the amount thereof, to the extent known. The indemnified party will give notice
to the indemnifying party that pursuant to the indemnity, the indemnified party
is asserting against the indemnifying party a claim with respect to a potential
loss from the third party claim, and such notice will constitute the assertion
of a claim for indemnity by the indemnified party. If, within ten (10) days
after receiving such notice, the indemnifying party advises the indemnified
party that it will provide indemnification and assume the defense at its
expense, then so long as such defense is being conducted, the indemnified party
will not settle or admit liability with respect to the claim without the consent
of the indemnifying party and will afford to the indemnifying party and
defending
Page 22
counsel reasonable assistance in defending against the claim. If the
indemnifying party assumes the defense, counsel reasonably acceptable to the
indemnified party will be selected by such party and if the indemnified party
then retains its own counsel, it will do so at its own expense. If the
indemnified party does not receive a written objection to the notice from the
indemnifying party within ten (10) days after the indemnifying party's receipt
of such notice, the claim for indemnity will be conclusively presumed to have
been assented to and approved, and in such case the indemnified party may
control the defense of the matter or case and, at its sole discretion, settle or
admit liability. If within the aforesaid ten (10) day period the indemnified
party will have received written objection to a claim (which written objection
will briefly describe the basis of the objection to the claim or the amount
thereof, all in good faith), then for a period of thirty (30) days after receipt
of such objection the parties will attempt to settle the dispute as between the
indemnified party and indemnifying parties. If they are unable to settle the
dispute, the unresolved issue or issues will be settled by a court of competent
jurisdiction located in Las Vegas, Nevada. During the pendency of any such
dispute, the indemnified party may control all aspects of the defense of the
matter or case.
(2) Claims by a Party. The determination of a claim asserted by a party
hereunder (other than as set forth in subsection (1) above) pursuant to this
Article will be made as follows: the indemnified party will give written notice
to the indemnifying party, within such time as not to prejudice unduly the
indemnifying party's ability to defend against the underlying claim, of any
claim by the indemnified party which has not been made pursuant to subsection
(1) above, stating with reasonable specificity the nature of such claim and the
amount thereof, to the extent known. The claim will be deemed to have resulted
in a determination in favor of the indemnified party and to have resulted in a
liability of the indemnifying party in an amount equal to the amount of such
claim estimated pursuant to this clause (2) if within thirty (30) days after the
indemnifying party's receipt of the claim the indemnified party will not have
received written objection to the claim. In such event, the claim will be
conclusively presumed to have been assented to and approved. If within the
aforesaid thirty (30) day period the indemnified party will have received
written objection to a claim (which written objection will briefly describe the
basis of the objection to the claim or the amount thereof, all in good faith),
then for a period of sixty (60) days after receipt of such objection the parties
will attempt to settle the disputed claim as between the indemnified and
indemnifying parties. If they are unable to settle the dispute, the unresolved
issue or issues will be settled by a court of competent jurisdiction located in
Las Vegas, NV.
8.5 Exclusive Remedy. The indemnification obligations under this Article
are the sole and exclusive remedies available to TRIPLE WIN, Shareholders, LVGI
and LV TWIN with respect to this Agreement and the transactions contemplated
hereunder.
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ARTICLE IX. MISCELLANEOUS
9.1 Other Expenses. Except as otherwise provided in this Agreement, each
party will pay all of its expenses in connection with the negotiation,
execution, and implementation of the transactions contemplated under this
Agreement.
9.2 Notices. All notices, requests, demands, waivers and other
communications required or permitted to be given under this Agreement will be in
writing and will be deemed to have been duly given: (a) if delivered personally
or sent by facsimile, on the date received, (b) if delivered by overnight
courier, on the day after mailing, and (c) if mailed, five days after mailing
with postage prepaid. Any such notice will be sent as follows:
To TRIPLE WIN or Shareholders:
----------------------------------
To: Xxxxxx X. Xxxxx, XX, Xxxx Xxxxxxxx, Xxxx X. Xxxxxxxx and Xxxxxxx
Xxxxxxx
To LVGI or LV TWIN:
-----------------------
To: Xxxxxxx Xxxx
9.3 Confidentiality; Prohibition on Trading. All parties agree to
maintain the confidentiality of this Agreement and the transactions contemplated
hereunder and thereunder, unless disclosure is required by law and except for
disclosures to be made in connection with obtaining shareholder approval and
third party consents, and actions required to consummate the contemplated
transactions. The Shareholders agree not to trade in the securities of LVGI
based upon any nonpublic information.
9.4 Controlling Law. This Agreement will be construed, interpreted and
enforced in accordance with the substantive laws of the State of Nevada, without
giving effect to its conflicts of laws provisions.
9.5 Headings. Any table of contents and Section headings in this
Agreement are for convenience of reference only and will not be considered or
referred to in resolving questions of interpretation.
9.6 Benefit. This Agreement will be binding upon and will inure to the
exclusive benefit of the parties hereto and their respective heirs, legal
representatives, successors and assigns. No party hereto may assign any rights
or delegate any duties hereunder without the prior written consent of the other
parties hereto and any prohibited assignment or delegation will be deemed null
and void.
9.7 Partial Invalidity. The invalidity or unenforceability of any
particular provision of this Agreement will not affect the other provisions
hereof, and this Agreement will be
Page 24
construed in all respects as if such invalid or unenforceable provisions were
omitted. Further, there will be automatically substituted for such invalid or
unenforceable provision a provision as similar as possible which is valid and
enforceable.
9.8 Counterparts and Facsimiles This Agreement may be executed
simultaneously in two (2) or more counterparts each of which will be deemed an
original and all of which together will constitute but one and the same
instrument. The signature page to this Agreement and all other documents
required to be executed at Closing may be delivered by facsimile and the
signatures thereon will be deemed effective upon receipt by the intended
receiving party.
9.9 Interpretation. All pronouns and any variation thereof will be deemed
to refer to the masculine, feminine, neuter, singular or plural as the identity
of the person or entity, or the context, may require. Further, it is
acknowledged by the parties that this Agreement has undergone several drafts
with the negotiated suggestions of both; and, therefore, no presumptions will
arise favoring either party by virtue of the authorship of any of its provisions
or the changes made through revisions.
9.10 Entire Agreement; Waivers. This Agreement, including the Exhibits and
Attachments hereto and those portions incorporated herein by reference,
constitutes the entire agreement between the parties hereto with regard to the
matters contained herein and it is understood and agreed that all previous
undertakings, negotiations, letter of intent and agreements between the parties,
are merged herein. This Agreement may not be modified orally, but only by an
agreement in writing signed by the parties hereto. The failure of any party to
this Agreement or the failure of any Shareholder to assert any of its rights
under this Agreement or otherwise will not constitute a waiver of such rights.
Neither the failure nor any delay on the part of any party hereto in exercising
any rights, power or remedy hereunder will operate as a waiver thereof or of any
right, power or remedy; nor will any single or partial exercise of any right,
power or remedy preclude any further or other exercise thereof, or the exercise
of any other right, power or remedy.
9.11 Legal Fees and Costs. In the event any party hereto incurs legal
expenses to enforce or interpret any provision of this Agreement, the prevailing
party will be entitled to recover such legal expenses, including, without
limitation, reasonable attorney's fees, costs and disbursements, in addition to
any other relief to which such party will be entitled.
Page 25
IN WITNESS WHEREOF, the parties hereto have executed this Agreement and
Plan of Merger as of the date first above written.
/s/ XXXXXX X. XXXXX, XX
_____________________________________
XXXXXX X. XXXXX, XX
/s/ XXXX XXXXXXXX
_____________________________________
XXXX XXXXXXXX
/s/ XXXX X. XXXXXXXX
_____________________________________
XXXX X. XXXXXXXX
/s/ XXXXXXX XXXXXXX
______________________________________
XXXXXXX XXXXXXX
TRIPLE WIN IN NEVADA, INC.
By: /s/ Xxxxxx X. Xxxxx XX
Title: President
LAS VEGAS GAMING, INC.
By: /s/ Xxxx Xxxx
Title: President
LAS VEGAS TWIN, INC.
By: /s/ Xxxx Xxxx
Title: President
