Exhibit 10.25
MIKOHN GAMING CORPORATION
Securities Purchase Agreement
This Securities Purchase and Exchange Agreement (this "Agreement") is
dated as of September 25, 2003, among Mikohn Gaming Corporation, a Nevada
corporation (the "Company"), and the purchasers identified on the signature
pages hereto (each, a "Purchaser" and collectively, the "Purchasers").
WHEREAS, subject to the terms and conditions set forth in this
Agreement and pursuant to Section 4(2) of the Securities Act (as defined
below) and Rule 506 promulgated thereunder, the Company desires to issue and
sell to the Purchasers, and the Purchasers, severally and not jointly, desire
to purchase from the Company certain securities of the Company, as more fully
described in this Agreement.
NOW, THEREFORE, IN CONSIDERATION of the mutual covenants contained in
this Agreement, and for other good and valuable consideration the receipt and
adequacy of which are hereby acknowledged, the Company and the Purchasers
agree as follows:
ARTICLE I.
DEFINITIONS
1.1 Definitions. In addition to the terms defined elsewhere in this
Agreement, for all purposes of this Agreement, the following terms shall have
the meanings indicated in this Section 1.1:
"Action" means any action, suit, inquiry, notice of violation,
proceeding (including any partial proceeding such as a deposition) or
investigation, whether pending or threatened in writing against or affecting
the Company, any Subsidiary or any of their respective properties before or
by any court, arbitrator, governmental or administrative agency, regulatory
authority (federal, state, county, local or foreign), stock market, stock
exchange or trading facility.
"Affiliate" means any Person that, directly or indirectly through
one or more intermediaries, controls or is controlled by or is under common
control with a Person, as such terms are used in and construed under Rule
144.
"Business Day" means any day except Saturday, Sunday and any day
which shall be a federal legal holiday or a day on which banking institutions
in the State of New York are authorized or required by law or other
governmental action to close.
"Closing" means the closing of the purchase and sale of the
Securities pursuant to Article II.
"Closing Date" means the date of the Closing.
"Commission" means the Securities and Exchange Commission.
"Common Stock" means the common stock of the Company, $0.10 par
value per share, and any securities into which such common stock may
hereafter be reclassified.
"Company Counsel" means Mayer, Brown, Xxxx & Maw LLP.
"Effective Date" means the date that the Registration Statement
required by Section 2(a) of the Registration Rights Agreement is first
declared effective by the Commission.
"Exchange Act" means the Securities Exchange Act of 1934, as
amended.
"Investment Amount" means, with respect to each Purchaser, the
investment amount indicated below such Purchaser's name on the signature page
of this Agreement.
"Lead Purchaser" means ________________.
"Lien" means any lien, charge, encumbrance, security interest,
option, claim, equitable interest, pledge, proxy, voting trust or agreement,
right of first refusal or other restrictions of any kind.
"Notes" means the Company's outstanding 11?% Senior Secured Notes
due 2008 issued pursuant to the Indenture, dated as of August 22, 2001
between the Company and Firstar Bank, N.A. (as Trustee).
"Per Unit Purchase Price" equals $5.34125.
"Person" means an individual or corporation, partnership, trust,
incorporated or unincorporated association, joint venture, limited liability
company, joint stock company, government (or an agency or subdivision
thereof) or other entity of any kind.
"Proceeding" means an Action, demand, claim, litigation, suit,
investigation, arbitration or proceeding (including, without limitation, an
investigation or partial proceeding, such as a deposition), whether pending
or threatened.
"Purchaser Percentage" means, with respect to a Purchaser, the
percentage equal to the product of (x) a fraction, the numerator of which
shall be the Investment Amount paid by such Purchaser on the Closing Date and
the denominator of which shall be the aggregate Investment Amount paid by all
Purchasers on the Closing Date multiplied by (y) 100.
"Registration Statement" means a registration statement meeting
the requirements set forth in the Registration Rights Agreement and covering
the resale by the Purchasers of the Shares and the Warrant Shares.
"Registration Rights Agreement" means the Registration Rights
Agreement, dated as of the date of this Agreement, among the Company and the
Purchasers, in the form of Exhibit B.
"Rule 144" means Rule 144 promulgated by the Commission pursuant
to the Securities Act, as such Rule may be amended from time to time, or any
similar rule or regulation hereafter adopted by the Commission having
substantially the same effect as such Rule.
"SEC Reports" has the meaning set forth in Section 3.1(h).
"Securities" means the Shares, the Warrants and the Warrant
Shares.
"Securities Act" means the Securities Act of 1933, as amended.
"Shares" means the shares of Common Stock to be issued to the
Purchasers at the Closing.
"Subsidiary" means any "significant subsidiary" as defined in
Rule 1-02(w) of Regulation 5-X promulgated by the Commission under the
Exchange Act .
"Trading Day" means (i) a day on which the Common Stock is traded
on a Trading Market, or (ii) if the Common Stock is not listed on a Trading
Market, a day on which the Common Stock is traded in the over-the-counter
market, as reported by the OTC Bulletin Board or the National Quotation
Bureau Incorporated, or (iii) if the Common Stock is not quoted on the OTC
Bulletin Board, a day on which the Common Stock is quoted in the
over-the-counter market as reported by the National Quotation Bureau
Incorporated (or any similar organization or agency succeeding to its
functions of reporting prices); provided, that in the event that the Common
Stock is not listed or quoted as set forth in (i), (ii) and (iii) hereof,
then Trading Day shall mean a Business Day.
"Trading Market" means whichever of the New York Stock Exchange,
the American Stock Exchange, the NASDAQ National Market or the NASDAQ
SmallCap Market, on which the Common Stock is listed or quoted for trading on
the date in question.
"Transaction Documents" means this Agreement, the Warrants, the
Registration Rights Agreement, and any other documents or agreements executed
in connection with the transactions contemplated hereunder.
"Warrants" means the Common Stock purchase warrants in the form
of Exhibit A, to be issued to the Purchasers at the Closing.
"Warrant Shares" means the shares of Common Stock issuable upon
exercise of the Warrants.
ARTICLE II.
PURCHASE AND SALE
2.1 Closing. Subject to the terms and conditions set forth in this
Agreement, at the Closing the Company shall issue and sell to each Purchaser,
and each Purchaser shall, severally and not jointly, purchase from the
Company, the Shares and the Warrants representing such Purchaser's Investment
Amount. The Closing shall take place at the offices of Mayer, Brown, Xxxx &
Maw LLP, 000 Xxxxxxx Xxxxxx, Xxxx Xxxx, Xxxxxxxxxx 00000-0000 on the 12th
calendar day following the date hereof or at such other location or time as
the parties may agree.
2.2 Closing Deliveries. (a) At the Closing, the Company shall
deliver or cause to be delivered to each Purchaser the following:
(i) a certificate evidencing a number of Shares equal to
such Purchaser's Investment Amount divided by the Per Unit Purchase Price,
registered in the name of such Purchaser;
(ii) a Warrant, registered in the name of such Purchaser,
pursuant to which such Purchaser shall have the right to acquire the number
of shares of Common Stock equal to 25% of the number of Shares issuable to
such purchaser in accordance with Section 2.2(a)(i);
(iii) accrued and unpaid interest on any Notes surrendered,
up to, but not including the Closing Date, in immediately available funds, by
wire transfer to an account designated in writing by the Purchaser for such
purpose;
(iv) the legal opinions of the Company's internal counsel
and Company Counsel, executed by such counsel and delivered to the
Purchasers, in form and substance reasonably satisfactory to the Lead
Purchaser; and
(v) the Registration Rights Agreement duly executed by
the Company.
(b) At the Closing, each Purchaser shall deliver or cause to be
delivered to the Company the following:
(i) such Purchaser's Investment Amount, payable in any
combination of (x) United States dollars and in immediately available funds,
by wire transfer to an account designated in writing by the Company for such
purpose or (y) surrender of Notes in the aggregate amount set forth on the
signature page attached hereto such that, when added to the amount payable in
U.S. dollars pursuant to clause (x) above, is equal to the Purchaser's
Investment Amount; and
(ii) the Registration Rights Agreement duly executed by
such Purchaser.
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
3.1 Representations and Warranties of the Company. The Company
hereby makes the following representations and warranties to each Purchaser:
(a) Subsidiaries. The Company has no direct or indirect
Subsidiaries other than those listed in Schedule 3.1(a). Except as disclosed
in Schedule 3.1(a), the Company owns, directly or indirectly, all of the
capital stock of each Subsidiary free and clear of any and all Liens, and all
the issued and outstanding shares of capital stock of each Subsidiary are
validly issued (including in compliance with all applicable gaming laws) and
are fully paid, non-assessable and free of preemptive and similar rights.
(b) Organization and Qualification. Each of the Company and
each Subsidiary is an entity duly incorporated or otherwise organized,
validly existing and in good standing under the laws of the jurisdiction of
its incorporation or organization (as applicable), with the requisite power
and authority to own and use its properties and assets and to carry on its
business as currently conducted. Neither the Company nor any Subsidiary is
in violation of any of the provisions of its respective certificate or
articles of incorporation, bylaws or other organizational or charter
documents. Each of the Company and each Subsidiary is duly qualified or
licensed to conduct business and is in good standing as a foreign corporation
or other entity in each jurisdiction in which the nature of the business
conducted or property owned by it makes such qualification or licensing
necessary, except where the failure to be so qualified or licensed or in good
standing, as the case may be, would not, individually or in the aggregate,
have or reasonably be expected to result in (i) an adverse effect on the
legality, validity or enforceability of any Transaction Document, (ii) a
material and adverse effect on the results of operations, earnings, net
worth, assets, business or condition (financial or otherwise) of the Company
and the Subsidiaries, taken as a whole on a consolidated basis, or (iii) an
adverse impairment to the Company's ability to perform fully on a timely
basis its obligations under any Transaction Document (any of (i), (ii) or
(iii), a "Material Adverse Effect").
(c) Authorization; Enforcement. The Company has the requisite
corporate power and authority to execute and deliver each of the Transaction
Documents and to enter into and to consummate the transactions contemplated
by each of the Transaction Documents to which it is a party and otherwise to
carry out its obligations thereunder. The execution and delivery of each of
the Transaction Documents to which it is a party by the Company and the
consummation by it of the transactions contemplated thereby have been duly
authorized by all necessary action on the part of the Company and no further
action is required by the Company or its stockholders in connection
therewith. this Agreement has been (and upon delivery at Closing of the
other Transaction Documents will have been) duly executed by the Company, and
this Agreement constitutes, and each other Transaction Document when
delivered in accordance with the terms hereof will constitute, the valid and
binding obligation of the Company enforceable against the Company in
accordance with its terms.
(d) No Conflicts. The execution, delivery and performance of
the Transaction Documents to which it is a party by the Company and the
consummation by the Company of the transactions contemplated thereby do not
and will not (i) conflict with or violate any provision of the Company's or
any Subsidiary's certificate or articles of incorporation, bylaws or other
organizational or charter documents, or (ii) conflict with, or constitute a
default (or an event that with notice or lapse of time or both would become a
default) under, or give to others any rights of termination, amendment,
acceleration or cancellation (with or without notice, lapse of time or both)
of, any agreement, credit facility, debt or other instrument (evidencing a
Company or Subsidiary debt or otherwise) or other understanding to which the
Company or any Subsidiary is a party or by which any property or asset of the
Company or any Subsidiary is bound or affected, or (iii) conflict with, or
result in or constitute any violation of, any award, decision, judgment,
decree, injunction, writ, order, subpoena, ruling, verdict or arbitration
award entered, issued, made or rendered by any federal, state, local or
foreign government or any other Governmental Entity (each an "Order"), or any
Law, applicable to the Company or any of its subsidiaries, or to any of their
respective properties or assets, or to any Securities; (c) result in the
creation or imposition of (or the obligation to create or impose) any Lien on
any of the properties or assets of the Company or any of its subsidiaries, or
on any of the Securities; or (d) conflict with, or result in or constitute
any violation of, or result in the termination, suspension or revocation of,
any Authorization applicable to the Company or any of its subsidiaries, or to
any of their respective properties or assets, or to any of the Securities, or
result in any other impairment of the rights of the holder of any such
Authorization ; except in the case of each of clauses (ii) and (iii), such as
would not, individually or in the aggregate, have or reasonably be expected
to result in a Material Adverse Effect.
(e) Filings, Consents and Approvals. Assuming the accuracy of
the representation of each Purchaser set forth in Section 3.2 hereof, no
registration (including any registration under the Securities Act) or filing
with, or any notification to, or any approval, permission, consent,
ratification, waiver, authorization, order, finding of suitability, permit,
license, franchise, exemption, certification or similar instrument or
document (each, an "Authorization") of or from, any court, arbitral tribunal,
arbitrator, administrative or regulatory agency or commission or other
governmental or regulatory authority, agency or governing body, domestic or
foreign, including without limitation any Indian tribe or gaming commission,
authority or control board (each, a "Governmental Entity"), or any other
person, or under any statute, law, ordinance, rule, regulation or agency
requirement of any Governmental Entity, including without limitation any
gaming regulation or regulatory requirement (each, a "Law"), on the part of
the Company or any of its subsidiaries is required in connection with the
execution or delivery by the Company of the Transaction Documents or the
performance by the Company of its obligations under each of the Transaction
Documents except as would not have a material effect on the Company or its
performance of its obligations under the Transaction Documents.
(f) Issuance of the Securities. The Securities have been duly
authorized and, when issued and paid for in accordance with the Transaction
Documents, will be duly and validly issued, fully paid and nonassessable,
free and clear of all Liens, except for such restrictions on transfer or
ownership imposed by applicable federal or state securities laws or
applicable gaming laws. The Company has reserved from its duly authorized
capital stock the maximum number of shares of Common Stock issuable pursuant
to this Agreement and the Warrants in order to issue the Shares and the
Warrant Shares.
(g) Capitalization. The number of shares and type of all
authorized, issued and outstanding capital stock of the Company, and all
shares of Common Stock reserved for issuance under the Company's various
option and incentive plans, is set forth in Schedule 3.1(g). All of the
outstanding shares of the Company's capital stock have been duly authorized
and validly issued, fully paid and nonassessable, were issued in compliance
with all applicable federal and state securities laws and all applicable
gaming laws and are not subject to, and were not issued in violation of, any
preemptive or similar rights. Except as set forth in Schedule 3.1(g), no
securities of the Company are entitled to preemptive or similar rights, and
no Person has any right of first refusal, preemptive right, right of
participation, or any similar right to participate in the transactions
contemplated by the Transaction Documents. Except as a result of the
purchase and sale of the Securities and except as disclosed in Schedule
3.1(g), there are no outstanding options, warrants, scrip rights to subscribe
to, calls or commitments of any character whatsoever relating to, or
securities, rights or obligations convertible into or exchangeable for, or
giving any Person any right to subscribe for or acquire, any shares of Common
Stock, or contracts, commitments, understandings or arrangements by which the
Company or any Subsidiary is or may become bound to issue additional shares
of Common Stock, or securities or rights convertible or exchangeable into
shares of Common Stock. Except as set forth in Schedule 3.1(g), the issue
and sale of the Securities will not, immediately or with the passage of time,
obligate the Company to issue shares of Common Stock or other securities to
any Person (other than the Purchasers) and will not result in a right of any
holder of Company securities to adjust the exercise, conversion, exchange or
reset price under such securities.
(h) SEC Reports; Financial Statements. The Company has filed
all reports required to be filed by it under the Securities Act and the
Exchange Act, including pursuant to Section 13(a) or 15(d) thereof, for the
twelve months preceding the date hereof (or such shorter period as the
Company was required by law to file such reports) (the foregoing materials
being collectively referred to herein as the "SEC Reports" and, together with
the Schedules to this Agreement, the "Disclosure Materials") on a timely
basis or has timely filed a valid extension of such time of filing and has
filed any such SEC Reports prior to the expiration of any such extension.
The Company has informed each Purchaser prior to the date hereof of any
filing by the Company of any SEC Reports within the 10 days preceding the
date hereof. As of their respective dates, the SEC Reports complied in all
material respects with the requirements of the Securities Act and the
Exchange Act and the rules and regulations of the Commission promulgated
thereunder, and none of the SEC Reports, when filed, contained any untrue
statement of a material fact or omitted to state a material fact required to
be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading. The
financial statements of the Company included in the SEC Reports comply in all
material respects with applicable accounting requirements and the rules and
regulations of the Commission with respect thereto as in effect at the time
of filing. Such financial statements have been prepared in accordance with
generally accepted accounting principles applied on a consistent basis during
the periods involved ("GAAP"), except as may be otherwise specified in such
financial statements or the notes thereto, and fairly present in all material
respects the financial position of the Company and its consolidated
Subsidiaries as of and for the dates thereof and the results of operations
and cash flows for the periods then ended, subject, in the case of unaudited
statements, to normal, immaterial, year-end audit adjustments.
(i) Material Changes. Since the date of the latest audited
financial statements included within the SEC Reports, except as specifically
disclosed in the SEC Reports, (i) there has been no event, occurrence or
development that has had or that could be expected to result in a Material
Adverse Effect (a "Material Adverse Change"), (ii) the Company has not
incurred any liabilities (contingent or otherwise) other than (A) trade
payables and accrued expenses incurred in the ordinary course of business
consistent with past practice and (B) liabilities that would not be required
to be reflected in the Company's financial statements pursuant to GAAP or
that would not be required to be disclosed in filings made with the
Commission, (iii) the Company has not altered its method of accounting or the
identity of its auditors, except as disclosed in its SEC Reports, (iv) the
Company has not declared or made any dividend or distribution of cash or
other property to its stockholders or purchased, redeemed or made any
agreements to purchase or redeem any shares of its capital stock, (v) there
has not been any material change or any development involving or which could
reasonably be expected to involve a material change in the capital stock of
the Company or any of its subsidiaries, and (vi) the Company has not issued
any equity securities to any officer, director or Affiliate, except pursuant
to existing Company stock option plans. The Company does not have pending
before the Commission any request for confidential treatment of information.
(j) Litigation. Except as set forth in the Disclosure
Materials, there are no Proceedings pending or, to the Company's knowledge,
threatened in any court or before or by any other Governmental Entity to
which the Company or any subsidiary of the Company is or could be a party or
to which any of their respective properties or assets are or could be
subject, which, individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect, nor, to the knowledge of the
Company, is there any Law or Order outstanding against or affecting the
Company or any of its subsidiaries or any of their respective properties or
assets, which, individually or in the aggregate, would reasonably be expected
to have a Material Adverse Effect. To the knowledge of the Company, no
action has been taken and no Law or Order has been enacted, adopted or issued
by any Governmental Entity which prevents the execution, delivery or
performance of this Agreement or the issuance of the Securities or suspends
the offering, issuance or sale of the Securities in any jurisdiction in which
the Securities are proposed to be sold. To the knowledge of the Company, no
Order or relief of any nature by any Governmental Entity has been issued with
respect to the Company or any of its subsidiaries which would suspend the
offering, issuance or sale of the Securities in any jurisdiction in which the
Securities are proposed to be sold. There is no Action which (i) adversely
affects or challenges the legality, validity or enforceability of any of the
Transaction Documents or the Securities or (ii) would, if there were an
unfavorable decision, individually or in the aggregate, have or reasonably be
expected to result in a Material Adverse Effect. The Commission has not
issued any stop order or other order suspending the effectiveness of any
registration statement filed by the Company or any Subsidiary under the
Exchange Act or the Securities Act.
(k) Compliance. Neither the Company nor any Subsidiary (i) is
in default under or in violation of (and no event has occurred that has not
been waived that, with notice or lapse of time or both, could result in a
default by the Company or any Subsidiary under), nor has the Company or any
Subsidiary received notice of a claim that it is in default under or that it
is in violation of, any agreement, credit facility, debt or other instrument
(evidencing a Company or Subsidiary debt or otherwise) or other understanding
to which the Company or any Subsidiary is a party or by which any property or
asset of the Company or any Subsidiary is bound or affected (whether or not
such default or violation has been waived), (ii) is in violation of any order
of any court, arbitrator or governmental body, or (iii) to the Company's
knowledge, is or has been in violation of any statute, rule or regulation of
any governmental authority, including without limitation all foreign,
federal, state and local laws relating to taxes, environmental protection,
occupational health and safety, product quality and safety and employment,
labor matters and gaming matters, except in each case as would not,
individually or in the aggregate, have or reasonably be expected to result in
a Material Adverse Effect. The Company is in compliance with the applicable
requirements of the Xxxxxxxx-Xxxxx Act of 2002 and the rules and regulations
thereunder promulgated by the Commission, except where such noncompliance
would not have or reasonably be expected to result in a Material Adverse
Effect.
(l) Title to Assets. The Company and the Subsidiaries have
good and marketable title in fee simple to all real property owned by them
that is material to their respective businesses and good and marketable title
in all personal property owned by them that is material to their respective
businesses, in each case free and clear of all Liens, except for Liens as do
not materially affect the value of such property, do not materially interfere
with the use made and proposed to be made of such property by the Company and
the Subsidiaries and, in each case, would not, individually or in the
aggregate, reasonably be expected to have or result in a Material Adverse
Effect. To the Company's knowledge, any real property and facilities held
under lease by the Company and the Subsidiaries are held by them under valid,
subsisting and enforceable leases of which the Company and the Subsidiaries
are in compliance except, in each case, as would not reasonably be expected
to result in a Material Adverse Effect.
(m) Patents and Trademarks. The Company and the Subsidiaries
own (and are the record owner of) or possess adequate licenses to use, all
patents, patent applications, trademarks, trademark applications, service
marks, trade names, copyrights, licenses, confidential information,
technology and other similar rights (and all goodwill associated therewith)
that are necessary or that are used in connection with their respective
businesses as described in the SEC Reports and which the failure to so own or
have would, individually or in the aggregate, have or reasonably be expected
to result in a Material Adverse Effect (collectively, the "Intellectual
Property Rights"). Neither the Company nor any Subsidiary has received a
written notice that any of the Intellectual Property Rights violates or
infringes upon or conflicts with the rights of any Person. Except as set
forth in the SEC Reports, or as would not reasonably be expected to result in
a Material Adverse Effect, to the knowledge of the Company, all such
Intellectual Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights.
(n) Insurance. The Company and the Subsidiaries are insured by
insurers of recognized financial responsibility against such losses and risks
and in such amounts as are prudent and customary in the businesses in which
the Company and the Subsidiaries are engaged. The Company has no reason to
believe that it will not be able to renew its existing insurance coverage as
and when such coverage expires or to obtain similar coverage from similar
insurers as may be necessary to continue its business without a significant
increase in cost.
(o) Transactions With Affiliates and Employees. Except as set
forth in the SEC Reports, none of the officers or directors or Affiliates of
the Company and, to the knowledge of the Company, none of the employees of
the Company is presently a party to any transaction with the Company or any
Subsidiary (other than for services as employees, officers and directors),
including any contract, agreement or other arrangement providing for the
furnishing of services to or by, providing for rental of real or personal
property to or from, or otherwise requiring payments to or from any officer,
director, Affiliate or such employee or, to the knowledge of the Company, any
entity in which any officer, director, or any such employee has a substantial
interest or is an officer, director, trustee or partner.
(p) Internal Accounting Controls. The Company and the
Subsidiaries maintain a system of internal accounting controls sufficient to
provide reasonable assurance that (i) transactions are executed in accordance
with management's general or specific authorizations, (ii) transactions are
recorded as necessary to permit preparation of financial statements in
conformity with generally accepted accounting principles and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management's general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(q) Solvency. Based on the financial condition of the Company
as of the Closing Date (and assuming that the Closing shall have occurred),
(i) the Company's fair saleable value of its assets exceeds the amount that
will be required to be paid on or in respect of the Company's existing debts
and other liabilities (including known contingent liabilities) as they
mature; (ii) the Company's assets do not constitute unreasonably small
capital to carry on its business for the current fiscal year as now conducted
and as proposed to be conducted including its capital needs taking into
account the particular capital requirements of the business conducted by the
Company, and projected capital requirements and capital availability thereof;
and (iii) the current cash flow of the Company, together with the proceeds
the Company would receive, were it to liquidate all of its assets, after
taking into account all anticipated uses of the cash, would be sufficient to
pay all amounts on or in respect of its debt when such amounts are required
to be paid. The Company does not intend to incur debts beyond its ability to
pay such debts as they mature (taking into account the timing and amounts of
cash to be payable on or in respect of its debt).
(r) Certain Fees. Other than fees paid to ______________, no
brokerage or finder's fees or commissions are or will be payable by the
Company to any broker, financial advisor or consultant, finder, placement
agent, investment banker, bank or other Person with respect to the
transactions contemplated by this Agreement. The Purchasers shall have no
obligation with respect to any fees or with respect to any claims (other than
such fees or commissions owed by a Purchaser pursuant to written agreements
executed by such Purchaser which fees or commissions shall be the sole
responsibility of such Purchaser) made by or on behalf of other Persons for
fees of a type contemplated in this Section that may be due in connection
with the transactions contemplated by this Agreement.
(s) Certain Registration Matters. Assuming the accuracy of the
Purchasers' representations and warranties set forth in Section 3.2(b)-(e),
no registration under the Securities Act is required for the offer and sale
of the Shares and Warrant Shares by the Company to the Purchasers under the
Transaction Documents. The Company is eligible to register the resale of its
Common Stock for resale by the Purchasers under Form S-3 promulgated under
the Securities Act. Except as described in Schedule 3.1(s), the Company has
not granted or agreed to grant to any Person any rights (including
"piggy-back" registration rights) to have any securities of the Company
registered with the Commission or any other governmental authority that have
not been satisfied.
(t) Listing and Maintenance Requirements. Except as specified
in the SEC Reports, the Company has not, in the two years preceding the date
hereof, received notice from any Trading Market to the effect that the
Company is not, and has no reason to believe that it will not in the
foreseeable future continue to be, in compliance with the listing or
maintenance requirements thereof. The Company is in compliance with the
listing and maintenance requirements for continued listing of the Common
Stock on the NASDAQ Stock Market.
(u) Investment Company. The Company is not, and after giving
effect to the sale of the Securities and the application of the net proceeds
therefrom, will not be, an "investment company" within the meaning of the
Investment Company Act of 1940, as amended, or an Affiliate of an "investment
company."
(v) Application of Takeover Protections. The Company has taken
all necessary action, if any, in order to render inapplicable any control
share acquisition, business combination, poison pill (including any
distribution under a rights agreement) or other similar anti-takeover
provision under the Company's Certificate of Incorporation (or similar
charter documents) or the laws of its state of incorporation or any agreement
to which the Company is a party that is or could become applicable to the
Purchasers as a result of the Purchasers and the Company fulfilling their
obligations or exercising their rights under the Transaction Documents,
including without limitation the Company's issuance of the Securities and the
Purchasers' ownership of the Securities.
(w) No Additional Agreements. The Company does not have any
agreement or understanding with any Purchaser with respect to the
transactions contemplated by the Transaction Documents other than as
specified in this Agreement.
(x) Disclosure. The Company understands and confirms that the
Purchasers will rely on the foregoing representations and covenants in
effecting transactions in securities of the Company. All disclosure provided
to the Purchasers regarding the Company, its business and the transactions
contemplated hereby, furnished by or on behalf of the Company (including the
Company's representations and warranties set forth in this Agreement) are
true and correct and do not contain any untrue statement of a material fact
or omit to state any material fact necessary in order to make the statements
made therein, in light of the circumstances under which they were made, not
misleading.
(y) Regulation D. None of the Company or any affiliate (as
defined in Rule 501(b) of Regulation D ("Regulation D") under the Securities
Act) of the Company has directly, or through any agent (provided that no
representation is made as to the Agent or its affiliates or any person acting
on its behalf), (a) sold, offered for sale, solicited offers to buy or
otherwise negotiated in respect of any security (as defined in the Securities
Act) which is or will be integrated with the sale of the Securities in a
manner that would require the registration of the Securities under the
Securities Act or; (b) engaged in or used any form of general solicitation or
general advertising (within the meaning of Regulation D) in connection with
the sale of the Securities, including articles, notices or other
communications published in any newspaper, magazine or similar medium or
broadcast over television or radio, or any seminar or meeting whose attendees
have been invited by any general solicitation or general advertising.
3.2 Representations and Warranties of the Purchasers. Each Purchaser
hereby, for itself and for no other Purchaser, represents and warrants to the
Company as follows:
(a) Organization; Authority. Such Purchaser is an entity duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its organization with the requisite corporate or partnership
power and authority to enter into and to consummate the transactions
contemplated by the applicable Transaction Documents and otherwise to carry
out its obligations thereunder. The execution, delivery and performance by
such Purchaser of the transactions contemplated by this Agreement has been
duly authorized by all necessary corporate or, if such Purchaser is not a
corporation, such partnership, limited liability company or other applicable
like action, on the part of such Purchaser. Each of this Agreement and the
Registration Rights Agreement has been duly executed by such Purchaser, and
when delivered by such Purchaser in accordance with terms hereof, will
constitute the valid and legally binding obligation of such Purchaser,
enforceable against it in accordance with its terms.
(b) Investment Intent. Such Purchaser is acquiring the
Securities as principal for its own account for investment purposes only and
not with a view to or for distributing or reselling such Securities or any
part thereof, without prejudice, however, to such Purchaser's right, subject
to the provisions of this Agreement, at all times to sell or otherwise
dispose of all or any part of such Securities pursuant to an effective
registration statement under the Securities Act or under an exemption from
such registration and otherwise in compliance with applicable federal and
state securities laws. Subject to the immediately preceding sentence,
nothing contained herein shall be deemed a representation or warranty by such
Purchaser to hold the Securities for any period of time. Such Purchaser is
acquiring the Securities hereunder in the ordinary course of its business.
Such Purchaser does not have any agreement or understanding, directly or
indirectly, with any Person to distribute any of the Securities.
(c) Purchaser Status. At the time such Purchaser was offered
the Securities, it was, and at the date hereof it is, and on each date on
which it exercises the Warrants it will be, an "accredited investor" as
defined in Rule 501(a) under the Securities Act. Such Purchaser is not a
registered broker-dealer under Section 15 of the Exchange Act.
(d) Experience of such Purchaser. Such Purchaser, either alone
or together with its representatives, has such knowledge, sophistication and
experience in business and financial matters so as to be capable of
evaluating the merits and risks of the prospective investment in the Company
Securities, and has so evaluated the merits and risks of such investment.
Such Purchaser is able to bear the economic risk of an investment in the
Company Securities and, at the present time, is able to afford a complete
loss of such investment.
(e) General Solicitation. Such Purchaser is not purchasing the
Securities as a result of any advertisement, article, notice or other
communication regarding the Securities published in any newspaper, magazine
or similar media or broadcast over television or radio or presented at any
seminar or any other general solicitation or general advertisement.
(f) Access to Information. Such Purchaser acknowledges that it
has reviewed the Disclosure Materials and has been afforded (i) the
opportunity to ask such questions as it has deemed necessary of, and to
receive answers from, representatives of the Company concerning the terms and
conditions of the offering of the Shares and the merits and risks of
investing in the Securities; (ii) access to information about the Company and
the Subsidiaries and their respective financial condition, results of
operations, business, properties, management and prospects sufficient to
enable it to evaluate its investment; and (iii) the opportunity to obtain
such additional information that the Company possesses or can acquire without
unreasonable effort or expense that is necessary to make an informed
investment decision with respect to the investment. Neither such inquiries
nor any other investigation conducted by or on behalf of such Purchaser or
its representatives or counsel shall modify, amend or affect such Purchaser's
right to rely on the truth, accuracy and completeness of the Disclosure
Materials and the Company's representations and warranties contained in the
Transaction Documents.
(g) Certain Fees. Except for the fees that will be payable by
the Company under Section 3.1(r), such Purchaser has not entered into any
agreement or arrangement that would entitle any broker or finder to
compensation by the Company in connection with the sale of the Company
Securities to such Purchaser.
(h) No Legal, Tax or Investment Advice. Such Purchaser
understands that nothing in Transaction Documents or any other materials
presented to such Purchaser in connection with the purchase and sale of the
Common Shares constitutes legal, tax or investment advice. Such Purchaser
has consulted such legal, tax and investment advisors as it, in its sole
discretion, has deemed to be necessary or appropriate in connection with its
purchase of the Common Shares.
The Company acknowledges and agrees that each Purchaser does not make or has
not made any representations or warranties with respect to the transactions
contemplated hereby other than those specifically set forth in this Section
3.2.
ARTICLE IV.
OTHER AGREEMENTS OF THE PARTIES
4.1(a) Securities may only be disposed of in compliance with state
and federal securities laws, including pursuant to an exemption therefrom.
In connection with any transfer of the Securities other than pursuant to an
effective registration statement pursuant to paragraph (k) of Rule 144, to
the Company, to an Affiliate of a Purchaser or in connection with a pledge as
contemplated in Section 4.1(b), the Company may require the transferor
thereof to provide to the Company an opinion of counsel selected by the
transferor and reasonably acceptable to the Company, the form and substance
of which opinion shall be reasonably satisfactory to the Company, to the
effect that such transfer does not require registration of such transferred
Securities under the Securities Act.
(b) Certificates evidencing the Securities will contain the
following legend, so long as is required by this Section 4.1(b) or Section
4.1(c):
[NEITHER THESE SECURITIES NOR THE SECURITIES ISSUABLE UPON
EXERCISE OF THESE SECURITIES HAVE BEEN REGISTERED] [THESE
SECURITIES HAVE NOT BEEN REGISTERED]WITH THE SECURITIES AND
EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN
RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY,
MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN
AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE
REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE
WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL
OPINION OF COUNSEL TO THE TRANSFEROR (WHICH COUNSEL SHALL BE
REASONABLY ACCEPTABLE TO THE COMPANY) TO SUCH EFFECT, THE
SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY.
[THESE SECURITIES AND THE SECURITIES ISSUABLE UPON EXERCISE OF
THESE SECURITIES] [THESE SECURITIES] MAY BE PLEDGED IN CONNECTION
WITH A BONA FIDE MARGIN ACCOUNT SECURED BY SUCH SECURITIES.
The Company acknowledges and agrees that a Purchaser may from
time to time pledge, and/or grant a security interest in some or all of the
Securities pursuant to a bona fide margin agreement in connection with a bona
fide margin account and, if required under the terms of such agreement or
account, such Purchaser may transfer pledged or secured Securities to the
pledgees or secured parties. Such a pledge or transfer would not be subject
to approval or consent of the Company and no legal opinion of legal counsel
to the pledgee, secured party or pledgor shall be required in connection with
the pledge, but such legal opinion may be required in connection with a
subsequent transfer following default by the Purchaser transferee of the
pledge. No notice shall be required of such pledge. At the appropriate
Purchaser's expense, the Company will execute and deliver such reasonable
documentation as a pledgee or secured party of Securities may reasonably
request in connection with a pledge or transfer of the Securities including
the preparation and filing of any required prospectus supplement under Rule
424(b)(3) of the Securities Act or other applicable provision of the
Securities Act to appropriately amend the list of Selling Stockholders
thereunder.
(c) Certificates evidencing the Shares and Warrant Shares shall
not contain any legend (including the legend set forth in Section 4.1(b)):
(i) while a registration statement (including the Registration Statement)
covering the resale of such Shares and Warrant Shares is effective under the
Securities Act, or (ii) following any sale of such Shares or Warrant Shares
pursuant to Rule 144, or (iii) while such Shares or Warrant Shares are
eligible for sale under Rule 144(k), or (iv) if such legend is not required
under applicable requirements of the Securities Act (including judicial
interpretations and pronouncements issued by the Staff of the Commission).
The Company shall cause its internal counsel to issue any legal opinion or
instruction reasonably required by the Company's transfer agent on the
Effective Date to comply with the requirements set forth in this Section.
Following the Effective Date or at such earlier time as a legend is no longer
required for the Shares and Warrant Shares under this Section 4.1(c), the
Company will, no later than three Trading Days following the delivery by a
Purchaser to the Company or the Company's transfer agent of a certificate
representing Shares or Warrant Shares containing a restrictive legend,
deliver or cause to be delivered to such Purchaser a certificate representing
such Shares or Warrant Shares that is free from all restrictive and other
legends. The Company may not make any notation on its records or give
instructions to any transfer agent of the Company that enlarge the
restrictions on transfer set forth in this Section.
4.2 Furnishing of Information. As long as any Purchaser owns the
Securities, the Company covenants to timely file (or obtain extensions in
respect thereof and file within the applicable grace period) all reports
required to be filed by the Company after the date hereof pursuant to the
Exchange Act. As long as any Purchaser owns Securities, if the Company is
not required to file reports pursuant to such laws, it will prepare and
furnish to the Purchasers and make publicly available in accordance with Rule
144(c) such information as is required for the Purchasers to sell the Shares
and Warrant Shares under Rule 144. The Company further covenants that it will
take such further action as any holder of Securities may reasonably request,
all to the extent required from time to time to enable such Person to sell
such Shares and Warrant Shares without registration under the Securities Act
within the limitation of the exemptions provided by Rule 144.
4.3 Integration. The Company shall not, and shall use its
commercially reasonable efforts to ensure that no Affiliate of the Company
shall, sell, offer for sale or solicit offers to buy or otherwise negotiate
in respect of any security (as defined in Section 2 of the Securities Act)
that would be integrated with the offer or sale of the Securities in a manner
that would require the registration under the Securities Act of the sale of
the Securities to the Purchasers, or that would be integrated with the offer
or sale of the Securities for purposes of the rules and regulations of any
Trading Market.
4.4 Further Issuances. Except as otherwise contemplated herein, the
Company will not issue, sell, offer or agree to sell, or otherwise dispose
of, directly or indirectly, securities of the Company that are substantially
similar to the Common Stock or any securities convertible into, or
exercisable, or exchangeable for, Common Stock; or publicly announce an
intention to effect any such transaction, during the period of 180 days from
the Effective Date (as defined in the Registration Rights Agreement);
provided, however, that the Company may (i) issue Common Stock pursuant to
any stock option plan, stock ownership plan or dividend reinvestment plan of
the Company currently in effect; (ii) issue options to purchase Common Stock
pursuant to any stock option plan currently in effect; (iii) issue Common
Stock issuable upon the conversion of securities or the exercise of warrants
outstanding at the Closing; (iv) issue Common Stock or any other security
substantially similar to the Common Stock to a seller in connection with an
acquisition transaction, and (v) engage in such other transactions, if any,
agreed in writing by the Lead Purchaser.
4.5 Securities Laws Disclosure; Publicity. By 8:30 a.m. (New York
City time) on the Closing Date, the Company shall issue a press release
reasonably acceptable to the Purchasers disclosing the transactions
contemplated hereby. No later than the first Business Day following the
Closing Date, the Company shall file a Current Report on Form 8-K (disclosing
the "8-K Filing") with the Commission describing the material terms of the
transactions contemplated by the Transaction Documents hereby. In addition,
the Company will make such other filings and notices in the manner and time
required by the Commission and the Trading Market on which the Common Stock
is listed. The Company and the Purchasers shall consult with each other in
issuing any press releases or otherwise making public statements or filings
and other communications with the Commission or any regulatory agency or
Trading Market with respect to the transactions contemplated hereby, and
neither party shall issue any such press release or otherwise make any such
public statement, filing or other communication without the prior consent of
the other, except if such disclosure is required by law, in which case the
disclosing party shall promptly provide the other party with prior notice of
such public statement, filing or other communication. Notwithstanding the
foregoing, the Company shall not publicly disclose the name of any Purchaser,
or include the name of any Purchaser in any filing with the Commission (other
than the Registration Statement and any exhibits to filings made in respect
of this transaction in accordance with periodic filing requirements under the
Exchange Act) or any regulatory agency or Trading Market, without the prior
written consent of such Purchaser, except to the extent such disclosure is
required by law or Trading Market regulations, in which case the Company
shall provide the Purchasers with prior notice of such disclosure. Subject
to the foregoing, neither the Company nor any Purchaser shall issue any press
releases or any other public statements with respect to the transactions
contemplated hereby; provided, however, that the Company shall be entitled,
without the prior approval of any Purchaser, to make any press release or
other public disclosure with respect to such transactions (i) in substantial
conformity with the 8-K Filing and contemporaneously therewith and (ii) as is
required by applicable law and regulations (provided that in the case of
clause (i) each Purchaser shall be consulted by the Company in connection
with any such press release or other public disclosure prior to its release).
4.6 Indemnification of Purchasers. In addition to the indemnity
provided in the Registration Rights Agreement, the Company will indemnify and
hold the Purchasers and their directors, officers, shareholders, partners,
employees and agents (each, a "Purchaser Party") harmless from any and all
losses, liabilities, obligations, claims, contingencies, damages, costs and
expenses, including all judgments, amounts paid in settlements, court costs
and reasonable attorneys' fees and costs of investigation (collectively,
"Losses") that any such Purchaser Party may suffer or incur as a result of or
relating to any misrepresentation, breach or inaccuracy of any
representation, warranty, covenant or agreement made by the Company in any
Transaction Document (other than transactions brought by the investors or
shareholders of such Purchaser against such Purchaser), excluding only Losses
that result directly from such Purchaser's or Related Person's gross
negligence or willful misconduct. In addition to the indemnity contained
herein, the Company will reimburse each Purchaser Party for its reasonable
and documented legal and other out-of-pocket expenses (including the cost of
any investigation, preparation and travel in connection therewith) incurred
in connection therewith, as such expenses are incurred.
4.7 Non-Public Information. The Company covenants and agrees that
neither it nor any other Person acting on its behalf will provide any
Purchaser or its agents or counsel with any information that the Company
believes constitutes material non-public information, unless prior thereto
such Purchaser shall have executed a written agreement regarding the
confidentiality and use of such information. The Company understands and
confirms that each Purchaser shall be relying on the foregoing
representations in effecting transactions in securities of the Company.
4.8 Use of Proceeds. The Company shall use the net proceeds from the
sale of the Securities hereunder for working capital purposes to redeem (via
exchange or otherwise) outstanding Notes and not to redeem any capital stock
of the Company or to settle any outstanding Action.
ARTICLE V.
CONDITIONS
5.1 Conditions to Closing of the Purchasers. Each Purchaser's
obligation to purchase the Securities at the Closing is subject to the
satisfaction, or waiver by such Purchaser, of the following conditions:
(a) Representations and Warranties. The representations and
warranties of the Company set forth in this Agreement shall be true and
correct in all material respects (except for those qualified as to
materiality or a Material Adverse Effect, which shall be true and correct) as
of the date of this Agreement (except to the extent that such representation
or warranty speaks of an earlier date, in which case such representation or
warranty shall be true and correct in all material respects (or if qualified
as to materiality or a Material Adverse Effect, true and correct) as of such
date) as though made on and as of the Closing Date. The Purchaser shall have
received a certificate signed on behalf of the Company by the Chief Executive
Officer and the Chief Financial Officer of the Company to such effect.
(b) Performance of Obligations of Company. The Company shall
have performed in all material respects all agreements and covenants required
to be performed by it under this Agreement prior to the Closing Date. Such
Purchaser shall have received a certificate signed on behalf of the Company
by the Chief Executive Officer and the Chief Financial Officer of the Company
to such effect.
(c) Regulatory Approvals. The Company and each Purchaser shall
have received all requisite approvals (including all required findings of
suitability) regarding the issuance and sale of the Securities from all
applicable gaming commissions, including the Mississippi Gaming Commission
and the Louisiana Gaming Commission.
(d) NASD Filing. The Company shall have filed with the National
Association of Securities Dealers, a Notification Form: Listing of Additional
Shares with respect to the Shares.
5.2 Conditions to Closing of the Company. The Company's obligation
to issue and sell the Securities at the Closing is subject to the
satisfaction, or waiver by the Company, of the following conditions:
(a) Representations and Warranties. The representations and
warranties of each Purchaser set forth in this Agreement shall be true and
correct in all material respects as of the Closing Date (except to the extent
that such representation or warranty speaks of an earlier date, in which case
such representation or warranty shall be true and correct in all material
respects as of such date) as though made on and as of the Closing Date.
(b) Performance of Obligations of the Purchasers. Each of the
Purchasers shall have performed in all material respects all agreements and
covenants required to be performed by it under this Agreement prior to the
Closing Date.
(c) Regulatory Approvals. The Company and each Purchaser shall
have received all requisite approvals (including all required findings of
suitability) regarding the issuance and sale of the Securities from all
applicable gaming commissions, including the Mississippi Gaming Commission
and the Louisiana Gaming Commission.
(d) NASD Filing. The Company shall have filed with the National
Association of Securities Dealers, a Notification Form: Listing of Additional
Shares with respect to the Shares.
ARTICLE VI.
MISCELLANEOUS
6.1 Fees and Expenses. At the Closing, the Company shall pay the
fees of Skadden, Arps, Slate, Xxxxxxx and Xxxx LLP in connection with the
preparation of the Transaction Documents, it being understood that Skadden,
Arps, Slate, Xxxxxxx and Xxxx LLP has not rendered any legal advice to the
Company in connection with the transactions contemplated hereby and that the
Company has relied for such matters on the advice of its own counsel. Except
as specified in the immediately preceding sentence and in the Registration
Rights Agreement, each party shall pay the fees and expenses of its advisers,
counsel, accountants and other experts, if any, and all other expenses
incurred by such party incident to the negotiation, preparation, execution,
delivery and performance of the Transaction Documents. The Company shall pay
all stamp and other taxes and duties levied in connection with the sale of
the Securities.
6.2 Entire Agreement. The Transaction Documents, together with the
Exhibits and Schedules thereto, contain the entire understanding of the
parties with respect to the subject matter hereof and supersede all prior
agreements and understandings, oral or written, with respect to such matters,
which the parties acknowledge have been merged into such documents, exhibits
and schedules.
6.3 Notices. Any and all notices or other communications or
deliveries required or permitted to be provided hereunder shall be in writing
and shall be deemed given and effective on the earliest of (a) the date of
transmission, if such notice or communication is delivered via facsimile at
the facsimile number specified in this Section prior to 6:30 p.m. (New York
City time) on a Trading Day, (b) the next Trading Day after the date of
transmission, if such notice or communication is delivered via facsimile at
the facsimile number specified in this Section on a day that is not a Trading
Day or later than 6:30 p.m. (New York City time) on any Trading Day, (c) the
Trading Day following the date of mailing, if sent by U.S. nationally
recognized overnight courier service, or (d) upon actual receipt by the party
to whom such notice is required to be given. The address for such notices
and communications shall be as follows:
If to the Company: Mikohn Gaming Corporation
000 Xxxxx Xxxx
Xxx Xxxxx, XX 00000
Attn: Chief Financial Officer
Facsimile No.: (000) 000-0000
With a copy to: Mayer, Brown, Xxxx & Maw LLP
000 Xxxxxxx Xxxxxx
Xxxx Xxxx, XX 00000-0000
Attn: Xxxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
If to a Purchaser: To the address set forth under such Purchaser's
name on the signature pages hereof;
or such other address as may be designated in writing hereafter, in the same
manner, by such Person.
6.4 Amendments; Waivers. No provision of this Agreement may be
waived or amended except in a written instrument signed, in the case of an
amendment, by the Company and each of the Purchasers or, in the case of a
waiver, by the party against whom enforcement of any such waiver is sought.
No waiver of any default with respect to any provision, condition or
requirement of this Agreement shall be deemed to be a continuing waiver in
the future or a waiver of any subsequent default or a waiver of any other
provision, condition or requirement hereof, nor shall any delay or omission
of either party to exercise any right hereunder in any manner impair the
exercise of any such right.
6.5 Construction. The headings herein are for convenience only, do
not constitute a part of this Agreement and shall not be deemed to limit or
affect any of the provisions hereof. The language used in this Agreement
will be deemed to be the language chosen by the parties to express their
mutual intent, and no rules of strict construction will be applied against
any party. This Agreement shall be construed as if drafted jointly by the
parties, and no presumption or burden of proof shall arise favoring or
disfavoring any party by virtue of the authorship of any provisions of this
Agreement or any of the Transaction Documents.
6.6 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the parties and their successors and permitted
assigns. The Company may not assign this Agreement or any rights or
obligations hereunder without the prior written consent of the Purchasers.
Any Purchaser may assign any or all of its rights under this Agreement to any
Person to whom such Purchaser assigns or transfers any Securities, provided
such transferee agrees in writing to be bound, with respect to the
transferred Securities, by the provisions hereof that apply to the
"Purchasers."
6.7 No Third-Party Beneficiaries. This Agreement is intended for the
benefit of the parties hereto and their respective successors and permitted
assigns and is not for the benefit of, nor may any provision hereof be
enforced by, any other Person, except as otherwise set forth in Section 4.6.
6.8 Governing Law. All questions concerning the construction,
validity, enforcement and interpretation of this Agreement shall be governed
by and construed and enforced in accordance with the internal laws of the
State of New York, without regard to the principles of conflicts of law
thereof. Each party agrees that all Proceedings concerning the
interpretations, enforcement and defense of the transactions contemplated by
this Agreement and any other Transaction Documents (whether brought against a
party hereto or its respective Affiliates, employees or agents) shall be
commenced exclusively in the state and federal courts sitting in the City of
New York, Borough of Manhattan (the "New York Courts"). Each party hereto
hereby irrevocably submits to the exclusive jurisdiction of the New York
Courts for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein
(including with respect to the enforcement of the any of the Transaction
Documents), and hereby irrevocably waives, and agrees not to assert in any
Proceeding, any claim that it is not personally subject to the jurisdiction
of any such New York Court, or that such Proceeding has been commenced in an
improper or inconvenient forum. Each party hereto hereby irrevocably waives
personal service of process and consents to process being served in any such
Proceeding by mailing a copy thereof via registered or certified mail or
overnight delivery (with evidence of delivery) to such party at the address
in effect for notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to
serve process in any manner permitted by law. Each party hereto hereby
irrevocably waives, to the fullest extent permitted by applicable law, any
and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
6.9 Survival. The representations, warranties, agreements and
covenants contained herein shall survive the Closing and the delivery of the
Shares and Warrants.
6.10 Execution. This Agreement may be executed in two or more
counterparts, all of which when taken together shall be considered one and
the same agreement and shall become effective when counterparts have been
signed by each party and delivered to the other party, it being understood
that both parties need not sign the same counterpart. In the event that any
signature is delivered by facsimile transmission, such signature shall create
a valid and binding obligation of the party executing (or on whose behalf
such signature is executed) with the same force and effect as if such
facsimile signature page were an original thereof.
6.11 Severability. If any provision of this Agreement is held to be
invalid or unenforceable in any respect, the validity and enforceability of
the remaining terms and provisions of this Agreement shall not in any way be
affected or impaired thereby and the parties will attempt to agree upon a
valid and enforceable provision that is a reasonable substitute therefor, and
upon so agreeing, shall incorporate such substitute provision in this
Agreement.
6.12 Rescission and Withdrawal Right. Notwithstanding anything to the
contrary contained in (and without limiting any similar provisions of) the
Transaction Documents, whenever any Purchaser exercises a right, election,
demand or option under a Transaction Document and the Company does not timely
perform its related obligations within the periods therein provided, then
such Purchaser may rescind or withdraw, in its sole discretion from time to
time upon written notice to the Company, any relevant notice, demand or
election in whole or in part without prejudice to its future actions and
rights.
6.13 Replacement of Securities. If any certificate or instrument
evidencing any Securities is mutilated, lost, stolen or destroyed, the
Company shall issue or cause to be issued in exchange and substitution for
and upon cancellation thereof, or in lieu of and substitution therefor, a new
certificate or instrument, but only upon receipt of evidence reasonably
satisfactory to the Company of such loss, theft or destruction and customary
and reasonable indemnity, if requested. The applicants for a new certificate
or instrument under such circumstances shall also pay any reasonable third-
party costs associated with the issuance of such replacement Securities. If
a replacement certificate or instrument evidencing any Securities is
requested due to a mutilation thereof, the Company may require delivery of
such mutilated certificate or instrument as a condition precedent to any
issuance of a replacement.
6.14 Remedies. In addition to being entitled to exercise all rights
provided herein or granted by law, including recovery of damages, each of the
Purchasers and the Company will be entitled to specific performance under the
Transaction Documents. The parties agree that monetary damages may not be
adequate compensation for any loss incurred by reason of any breach of
obligations described in the foregoing sentence and hereby agrees to waive in
any action for specific performance of any such obligation the defense that a
remedy at law would be adequate.
6.15 Payment Set Aside. To the extent that the Company makes a
payment or payments to any Purchaser pursuant to any Transaction Document or
a Purchaser enforces or exercises its rights thereunder, and such payment or
payments or the proceeds of such enforcement or exercise or any part thereof
are subsequently invalidated, declared to be fraudulent or preferential, set
aside, recovered from, disgorged by or are required to be refunded, repaid or
otherwise restored to the Company, a trustee, receiver or any other person
under any law (including, without limitation, any bankruptcy law, state or
federal law, common law or equitable cause of action), then to the extent of
any such restoration the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or setoff had not occurred.
6.16 Independent Nature of Purchasers' Obligations and Rights. The
obligations of each Purchaser under any Transaction Document are several and
not joint with the obligations of any other Purchaser, and no Purchaser shall
be responsible in any way for the performance of the obligations of any other
Purchaser under any Transaction Document. The decision of each Purchaser to
purchase Shares pursuant to this Agreement has been made by such Purchaser
independently of any other Purchaser and independently of any information,
materials, statements or opinions as to the business, affairs, operations,
assets, properties, liabilities, results of operations, condition (financial
or otherwise) or prospects of the Company or of the Subsidiary which may have
been made or given by any other Purchaser or by any agent or employee of any
other Purchaser, and no Purchaser or any of its agents or employees shall
have any liability to any other Purchaser (or any other person) relating to
or arising from any such information, materials, statements or opinions.
Nothing contained herein or in any Transaction Document, and no action taken
by any Purchaser pursuant thereto, shall be deemed to constitute the
Purchasers as a partnership, an association, a joint venture or any other
kind of entity, or create a presumption that the Purchasers are in any way
acting in concert or as a group with respect to such obligations or the
transactions contemplated by the Transaction Document. Each Purchaser
acknowledges that no other Purchaser has acted as agent for such Purchaser in
connection with making its investment hereunder and that no other Purchaser
will be acting as agent of such Purchaser in connection with monitoring its
investment hereunder. Each Purchaser shall be entitled to independently
protect and enforce its rights, including without limitation the rights
arising out of this Agreement or out of the other Transaction Documents, and
it shall not be necessary for any other Purchaser to be joined as an
additional party in any proceeding for such purpose.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOLLOW]
IN WITNESS WHEREOF, the parties hereto have caused this Securities
Purchase Agreement to be duly executed by their respective authorized
signatories as of the date first indicated above.
MIKOHN GAMING CORPORATION
By: /s/ Xxxx X. Xxxxxx
-------------------------
Name: Xxxx X. Xxxxxx
Title: Executive Vice President,
Chief Financial Officer and
Treasurer
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
SIGNATURE PAGES FOR PURCHASERS FOLLOW]
IN WITNESS WHEREOF, the parties have executed this Securities Purchase
and Exchange Agreement as of the date first written above.
By:_____________________________________
Name:
Title:
Consideration: [Notes and/or Cash]
Cash Paid: Dollar Amount of Notes
surrendered:
Face/Principal Amount of Notes surrendered:
_____________________________________
Investment Amount: $_________________
Address for Notice:
Facsimile No.:
Attn:
