Exhibit 10.79
10
PURCHASE AGREEMENT
This Purchase Agreement is made as of March 1, 1999, by and
between:
XXXX X. XXXXXXXX, a person of the age of majority and
domiciled in Calcasieu Parish, Louisiana, whose mailing address
is X.X. Xxx 0000, Xxxx Xxxxxxx, Xxxxxxxxx 00000-0000 (the
"Individual"); and
PLAYERS LAKE XXXXXXX, LLC (successor in interest to Players
Lake Xxxxxxx, Inc.), a Louisiana limited liability company
("Players"), herein represented by Players Lake Xxxxxxx
Riverboat, Inc., its duly authorized managing member, which
appears herein by and through Xxxxxx X. Xxxxxxxx, its duly
authorized president, whose mailing address is 0000 Xxxxx Xxxxxx,
Xxxx Xxxxxxx, Xxxxxxxxx 00000.
BACKGROUND
A. The Individual is the holder of a Payment Interest
under the terms of that certain Settlement Agreement dated as of
the 27th day of July, 1995 (the "Settlement Agreement"), by and
among Players Lake Xxxxxxx, Inc. (predecessor in interest to
Players), The Xxxxxx Corporation ("Xxxxxx") and certain other
parties, pursuant to which Settlement Agreement, Players agreed,
among other things, to pay to Xxxxxx the sum of $1.425 per Gaming
Patron included in the Coast Guard Count in any Rental Year (the
"Payment Interest"; each capitalized term is used as defined in
the Settlement Agreement).
B. On or after July 28, 1995, with the consent of Players,
Xxxxxx assigned a portion of the Payment Interest, consisting of
$0.25 per Gaming Patron included in the Coast Guard Count in any
Rental Year (the "Boellert Payment Interest"), to the Individual.
Each month, the Individual receives payment from Players (the
"Monthly Payments") in an amount determined by multiplying the
Boellert Payment Interest by the number of Gaming Patrons
included in the Coast Guard Count during the immediately
preceding month.
C. On or about February 8, 1999, Players' parent
corporation, Players International, Inc. ("PII"), entered into a
merger agreement with Jackpot Enterprises, Inc. ("Jackpot")
pursuant to which, among other things, a subsidiary of Jackpot is
to merge with and into PII (the "Merger Transactions").
D. Players has offered to purchase from Boellert and
Boellert has agreed to sell and convey to Players the Boellert
Payment Interest, all subject to the terms and conditions of this
Agreement.
NOW, THEREFORE, in consideration of the foregoing, the
mutual promises contained herein, and other good and valuable
consideration, the receipt and legal sufficiency of which are
hereby acknowledged, the parties hereto, intending to be legally
bound hereby, agree as follows:
1. Incorporation of Background. The Background provisions
above are incorporated herein by this reference as if set forth
at length. Players and the Individual hereby acknowledge the
truth and accuracy of the Background provisions.
2. Purchase and Sale of Boellert Payment Interest. On the
third business day of the month next following the receipt of
Regulatory Approval (as hereinafter defined) (the "Closing
Date"), Players shall purchase from the Individual, and the
Individual shall sell to Players the Boellert Payment Interest.
If the Closing Date does not occur on or before January 5, 2000,
this Agreement and the rights and obligations of the parties
hereunder shall terminate; provided, however, that if any of the
parties shall have acted in bad faith in seeking Regulatory
Approval, then this Agreement shall be deemed breached by any
such party and the other party hereto shall have such rights and
remedies as may be available at law.
3. Purchase Price. In consideration of the purchase of
the Boellert Payment Interest, on the Closing Date, Players shall
(i) pay to the Individual the sum of One Hundred Thousand and
No/100 Dollars ($100,000.00) in immediately available funds (the
"Cash Obligation"), and (ii) purchase a fixed annuity contract
for the benefit of the Individual (the "Annuity"), which Annuity
shall provide for monthly payments in the amounts and at the
times provided below:
(a) monthly payments in the gross amount of Twenty
Five Thousand and No/100 Dollars ($25,000.00) each, for a period
of one hundred twenty (120) consecutive months commencing on the
first day of the month immediately following the Closing Date
(the "First Tier Payments");
(b) monthly payments in the gross amount of Fifteen
Thousand and No/100 Dollars ($15,000.00) each, for a period of
one hundred twenty (120) consecutive months commencing on the
first day of the month immediately following the date of the last
First Tier Payment (the "Second Tier Payments"); provided,
however, that the Second Tier Payments shall be reduced in
accordance with the following calculation:
(1) For the purposes of this provision, the
principal balance of Players' obligations to the Individual as of
the date of this Agreement shall be deemed to be Three Million
Two Hundred Sixty Thousand and No/100 Dollars ($3,260,000.00)
(the "Principal Balance"). Interest shall accrue on the unpaid
portion of the Principal Balance from and after the date of this
Agreement at the rate of five and sixty one-hundredths percent
(5.60%) per annum (the "Applicable Rate").
(2) Each Monthly Payment accrued from and after
the date of this Agreement shall be applied first to pay interest
accrued on the Principal Balance, and then to reduce the
Principal Balance (such reduced Principal Balance referred to as
the "Adjusted Principal Balance"). Provided that Closing occurs
on the Closing Date, Players shall have no obligation to make any
Monthly Payment or any pro rated portion thereof to the
Individual for any portion of the month in which Closing occurs.
(3) On the Closing Date, the Adjusted Principal
Balance shall be subtracted from the Principal Balance, and the
resultant sum shall be referred to as the "Amortized Principal".
(4) The present value of the Second Tier Payments
shall be determined using a discount rate equal to the Applicable
Rate.
(5) Second Tier Payments shall be eliminated
until the present value of all Second Tier Payments so eliminated
is equal to the Amortized Principal.
As a condition to the Individual's obligation to sell the
Boellert Payment Interest hereunder, Players must provide to the
Individual the opinion of a tax advisor reasonably satisfactory
to the Individual to the effect that, notwithstanding the
purchase of the Annuity, the Individual shall not be deemed to
have realized, as income, the principal amount of the Annuity.
The terms of the Annuity shall be acceptable to the Individual in
his reasonable discretion; provided, however, that there shall be
no increase in the cost of the Annuity to Players as a result of
any such terms.
4. Release and Non-Compete Agreement. In consideration of
the receipt of the Cash Obligation and the purchase of the
Annuity, the Individual shall execute and deliver to Players a
Release and Non-Compete Agreement in substantially the form
attached hereto as Exhibit "A" (the "Release and Non-Compete
Agreement").
5. Conditions Precedent.
(a) Players' obligation to purchase the Boellert
Payment Interest shall be contingent upon the earlier to occur
of:
(i) Players' receipt of approval of the
transactions contemplated by this Agreement from the Louisiana
Gaming Control Board or any other Louisiana gaming regulatory
authorities having jurisdiction over the operations of Players
(the "Louisiana Regulators"); and
(ii) the failure of the Louisiana Regulators
to respond within sixty (60) days after Players' submission to
the Louisiana Regulators of a request for a determination of
whether the transactions contemplated by this Agreement require
the approval of the Louisiana Regulators; and
(iii) Players' receipt of a written
determination from the Louisiana Regulators to the effect that
approval of the transactions contemplated by this Agreement is
not required (the happening of any event described in
subparagraph (i), (ii) or (iii) shall be referred to as
"Regulatory Approval").
(b) Players shall diligently pursue Regulatory
Approval in conjunction with its efforts to obtain approval of
the Merger Transactions. However, if the Merger Transactions
(and consequently, the transactions contemplated by this
Agreement) have not been approved by the Louisiana Regulators on
or before September 30, 1999, then Players, with the assistance
and cooperation of the Individual, as needed, shall make
independent application for Regulatory Approval. Players shall
diligently pursue all such approvals.
6. Obligation to Renegotiate. If, at 5:00 p.m. EST on the
first day of the month in which the Closing Date is to occur,
there is a difference of greater than 100 basis points between
the rate on the 30-year United States Treasury Bond then in
effect and the Applicable Rate, then at the option of either
party, this Agreement and the rights and obligations of the
parties hereunder shall terminate; provided, however, that for a
period of thirty (30) days thereafter, the parties shall have an
obligation to negotiate in good faith toward an agreement that
would provide the parties with the relative benefits and
obligations described herein, while minimizing the economic
impact of the change in interest rates.
7. Time of Closing; Closing Deliveries. Closing of the
purchase and sale of the Boellert Payment Interest ("Closing")
shall take place on the Closing Date at a time and a place
mutually convenient to the parties. At Closing, Players shall
deliver to the Individual the Cash Obligation, evidence of the
purchase of the Annuity and the opinion of a tax adviser as
referenced in paragraph 3, above, and the Individual shall
deliver to Players the Release and Non-Compete Agreement.
8. Entire Agreement. This Agreement contains the entire
understanding of the parties hereto with respect to the subject
matter contained herein.
9. Counterparts. This Agreement may be executed in one or
more counterparts, all of which taken together shall constitute
one instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Purchase Agreement before the undersigned, competent witnesses,
and the notaries shown below, as of the date first above written.
WITNESSES:
____________________________ __________________________________
Xxxx X. Xxxxxxxx
____________________________
___________________________
Notary Public
ATTEST: PLAYERS LAKE XXXXXXX, LLC
By:Players Lake Xxxxxxx Riverboat,
Inc., Managing Member
____________________________ By:__________________________
Xxxxxx X. Xxxxxxxx, President
____________________________
____________________________
Notary Public
EXHIBIT "A"
RELEASE AND NON-COMPETE AGREEMENT
This Release and Non-compete Agreement is made on the _____
day of __________, _____, by and between XXXX X. XXXXXXXX, an
individual (the "Individual") and PLAYERS LAKE XXXXXXX, LLC
(successor in interest to Players Lake Xxxxxxx, Inc.), a
Louisiana limited liability company ("Players").
BACKGROUND
A. Pursuant to the terms of that certain Purchase
Agreement dated as of the first (1st) day of March, 1999, by and
between Players and the Individual (the "Purchase Agreement"),
Players offered to purchase from the Individual and the
Individual agreed to sell and convey to Players, the "Boellert
Payment Interest" (as that term is defined in the Purchase
Agreement) arising under that certain Settlement Agreement dated
as of the 27th day of July, 1995, by and among Players Lake
Xxxxxxx, Inc. (predecessor in interest to Players) and certain
other parties (the "Settlement Agreement"), all subject to the
terms and conditions of the Purchase Agreement.
B. The Individual is entering into this Agreement with
Players in consideration of its receipt of the consideration
stated in the Purchase Agreement.
NOW, THEREFORE, in consideration of the foregoing, the
mutual promises contained herein, and other good and valuable
consideration, the receipt and legal sufficiency of which is
hereby acknowledged, the parties hereto, intending to be legally
bound hereby, agree as follows:
1. Incorporation of Background. The Background provisions
above are incorporated herein by this reference as if set forth
at length. Players and the Individual hereby acknowledge the
truth and accuracy of the Background provisions.
2. Acknowledgment of Receipt of Funds. The Individual
acknowledges that on even date herewith, the Individual received
from Players (i) the Cash Obligation (as that term is defined in
the Purchase Agreement) and (ii) evidence of Players' purchase of
the Annuity (as that term is defined in the Purchase Agreement),
in full and complete satisfaction of Players' obligations under
the Purchase Agreement.
3. Release.
(a) In full and complete settlement of (i) any and all
obligations of Players to the Individual (and any party claiming
under the Individual) arising under or out of the Settlement
Agreement and (ii) any claims that the Individual may have
against Players, and for and in consideration of the undertakings
of Players described herein and in the Purchase Agreement,
including the payment of the Cash Obligation and the purchase of
the Annuity, the Individual does hereby REMISE, RELEASE AND
FOREVER DISCHARGE Players, its affiliates and assigns, directors,
shareholders, partners, employees and agents, and their
respective successors and assigns, heirs, executors and
administrators (hereinafter all included within the term "Players
Parties"), of and from any and all manner of actions and causes
of actions, suits, debts, claims and demands whatsoever at law or
in equity, which it ever had, now has, or hereafter may have, or
which its heirs, executors, administrators, successors or
permitted assigns hereafter may have, by reason of any action,
matter, cause or thing whatsoever from the beginning of time to
the date of execution hereof; and particularly, but without
limitation of the foregoing general terms, any claims arising
from or relating in any way to the Settlement Agreement and the
Purchase Agreement, including but not limited to, any claims
which have been asserted, could have been asserted, or could be
asserted now or in the future under any federal, state or local
laws, and any common law claims now or hereafter recognized and
all claims for counsel fees and costs, and any claims relating in
any way to the Settlement Agreement or the Purchase Agreement.
Notwithstanding the foregoing, nothing contained in this
Paragraph 3(a) shall be deemed to limit the enforceability of any
provision of this Agreement.
(b) In full and complete settlement of (i) any and all
obligations of the Individual to Players (and any party claiming
under Players) arising under or out of the Settlement Agreement
and (ii) any claims that Players may have against the Individual,
and for and in consideration of the undertakings of the
Individual described herein and in the Purchase Agreement,
Players does hereby REMISE, RELEASE AND FOREVER DISCHARGE the
Individual, its heirs, executors and administrators (hereinafter
all included within the term "the Individual Parties"), of and
from any and all manner of actions and causes of actions, suits,
debts, claims and demands whatsoever at law or in equity, which
it ever had, now has, or hereafter may have, or which its heirs,
executors, administrators, successors or permitted assigns
hereafter may have, by reason of any action, matter, cause or
thing whatsoever from the beginning of time to the date of
execution hereof; and particularly, but without limitation of the
foregoing general terms, any claims arising from or relating in
any way to the Settlement Agreement and the Purchase Agreement,
including but not limited to, any claims which have been
asserted, could have been asserted, or could be asserted now or
in the future under any federal, state or local laws, and any
common law claims now or hereafter recognized and all claims for
counsel fees and costs, and any claims relating in any way to the
Settlement Agreement or the Purchase Agreement. Notwithstanding
the foregoing, nothing contained in this Paragraph 3(b) shall be
deemed to limit the enforceability of any provision of this
Agreement.
4. Covenant Not to Xxx. The Individual and Players
further agree and covenant that, except as may be necessary to
enforce their respective rights hereunder, neither will, directly
or indirectly, file, charge, claim, xxx or cause or permit to be
filed, charged or claimed, any action for damages, including
injunctive, declaratory, monetary or other relief against the
other, involving any matter occurring at any time in the past up
to the date hereof in connection with the Individual or Players,
as the case may be, or involving any continuing effects of any
actions or practices which may have arisen or occurred prior to
the date hereof. The Individual and Players further agree and
covenant that should either of them, directly or indirectly,
file, charge, claim, xxx or cause or permit to be filed, charged
or claimed, any action for damages, including injunctive,
declaratory, monetary or other relief, in each case as prohibited
by the preceding sentence, despite such party's agreement not to
do so hereunder, then such breaching party will repay to the
other all amounts (or the value of benefits) paid hereunder, and
pay all of the costs and expenses of the nonbreaching party
(including reasonable attorneys' fees) incurred in the defense of
any such action or undertaking.
5. Covenant Not to Compete. The Individual hereby agrees
that for a term of two (2) years, it shall not, directly or
indirectly (individually or for, with or through any other
person, firm, joint venture, corporation or other entity), carry
on or engage in any casino gaming business within Calcasieu
Parish, or solicit customers of Players within Calcasieu Parish;
provided, however, that subject to the terms of this Paragraph 5,
nothing contained herein shall limit the ability of the
Individual to distribute, own or operate, or to provide services
to any manufacturer, distributor, or operator of, "Video Draw
Poker Devices" as that term is defined in La.R.S.
33:4862.1(B)(15) ("VDPDs"). The phrase "carry on or engage in
any casino gaming business within Calcasieu Parish" shall mean
being or acting, in any capacity (whether legal or beneficial),
as an owner, landlord of, broker of or for, operator, employee,
agent, consultant, lobbyist, spokesperson or representative of
the interests of any person, firm, joint venture, corporation or
other entity engaged in, or preparing to engage in, gaming
operations or other casino gaming enterprises within the
geographical boundaries of Calcasieu Parish (any such person,
firm, joint venture, corporation or other entity being referred
to as a "Calcasieu Gaming Operator"). Notwithstanding the
provisions of the first sentence of this Paragraph 5, and as a
limited specific exception thereto, any party may (i) own or
operate VDPDs, so long as the subject VDPDs are not owned or
operated, directly or indirectly, with, for or on behalf of any
Calcasieu Gaming Operator, and (ii) distribute VDPDs, or provide
services to any person or entity who manufactures, distributes,
or operates VDPDs, so long as such distributee or recipient of
such services is not, now or in the future, a Calcasieu Parish
Operator. If, after the execution of this Agreement, any party
hereto is engaged in the distribution of VDPDs or the provision
of services to any person or entity who manufactures,
distributes, or operates VDPDs, and such distributee or recipient
of services becomes a Calcasieu Parish Operator, such party(ies)
shall immediately cease its(their) association with such
Calcasieu Parish Operator to the extent of such Calcasieu Parish
Operator's activities in Calcasieu Parish.
6. Indemnification.
(a) The Individual agrees to indemnify, hold harmless
and defend Players, and the Players Parties, from and against any
losses, liabilities, damages, charges, expenses, costs
(including, without limitation, attorneys' fees, court costs and
other legal costs and expenses), penalties, fines, injunctions,
suits, claims, judgments, or demands suffered by or made against
or imposed at any time upon any of the Players Parties, directly
or indirectly, arising as a result of or in connection with its
breach of any term of this Agreement, including its violation of
any of the terms and conditions of Paragraphs 4 or 5 of this
Agreement. If Players shall incur any fees, costs, expenses, or
charges (including, without limitation, attorneys' fees, court
costs and other legal costs or expenses) in order to enforce the
terms of this Agreement, the Individual agrees to pay directly,
or at Players' option to reimburse Players for, such fees, costs,
and expenses no later than thirty (30) days after receiving
written notice of said fees, costs, expenses, or charges.
(b) Players agrees to indemnify, hold harmless and
defend the Individual, and the Individual Parties, from and
against any losses, liabilities, damages, charges, expenses,
costs (including, without limitation, attorneys' fees, court
costs and other legal costs and expenses), penalties, fines,
injunctions, suits, claims, judgments, or demands suffered by or
made against or imposed at any time upon any of the Individual
Parties, directly or indirectly, arising as a result of or in
connection with its breach of any term of this Agreement,
including its violation of any of the terms and conditions of
Paragraph 4 of this Agreement. If the Individual shall incur any
fees, costs, expenses, or charges (including, without limitation,
attorneys' fees, court costs and other legal costs or expenses)
in order to enforce the terms of this Agreement, Players agrees
to pay directly, or at the Individual's option to reimburse the
Individual for, such fees, costs, and expenses no later than
thirty (30) days after receiving written notice of said fees,
costs, expenses, or charges.
7. Entire Agreement. This Agreement contains the entire
understanding of the parties hereto with respect to the subject
matter contained herein.
8. Counterparts. This Agreement may be executed in one or
more counterparts, all of which taken together shall constitute
one instrument.
IN WITNESS WHEREOF, the parties hereto have executed this
Release and Non-compete Agreement as of the date first above
written.
WITNESSES:
____________________________ __________________________________
Xxxx X. Xxxxxxxx
____________________________
____________________________
Notary Public
ATTEST: PLAYERS LAKE XXXXXXX, LLC
By:Players Lake Xxxxxxx Riverboat,
Inc., Managing Member
____________________________ By:_______________________________
Xxxxxx X. Xxxxxxxx, President
____________________________
____________________________
Notary Public
