January 19, 2001
Centaur, Inc.
00 X. Xxxxxxxxx Xxxxxx
Xxxx Xxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx
Re: Letter of Understanding
-----------------------
Dear Xxxx:
This letter of understanding ("LETTER") sets forth the basic terms and
conditions pursuant to which Argosy Gaming Company or a subsidiary of Argosy
Gaming Company (herein referred to as "PURCHASER") proposes to purchase the
entire partnership interest ("CENTAUR INTEREST") in Indiana Gaming Company, L.P.
("PARTNERSHIP") held by Centaur Inc. ("SELLER").
1. PURCHASE PRICE. Purchaser will pay to Seller $105 Million PLUS
interest thereon at the per annum rate of 5.5% from January 6, 2001 until the
date of purchase ("CLOSING") payable in cash at Closing of the Centaur Interest.
2. EXPENSES. Purchaser and Seller shall be responsible for their own
expenses, including fees and expenses of counsel, advisors and consultants;
PROVIDED, HOWEVER, the filing fees pursuant to the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976 ("HSR ACT") shall be paid by Purchaser.
3. EXCLUSIVITY. During the Exclusivity Period (as hereinafter defined),
Seller shall work with Purchaser to negotiate and execute definitive agreements
and to close and complete the purchase of the Centaur Interest (the
"TRANSACTION"), and Seller will not directly or indirectly or in any manner
whatsoever (including, without limitation, through an affiliate or subsidiary or
through any agency, trust or nominee arrangement):
(a) enter into or agree to enter into, any agreement with respect to
the sale of the Centaur Interest or the capital stock or assets of
Seller, participate in any discussions or otherwise make or solicit any
proposal or offer with respect to the sale of the Centaur Interest or
capital stock or assets of Seller which competes with, or may compete
with or otherwise prevent or delay the completion of the Transaction;
or
(b) sell or agree to sell, solicit or make any proposal or participate
in any discussions to or offer to sell any interest in the Centaur
Interest or the capital stock or assets of Seller.
For breach by Seller of this paragraph 3, in addition to any other
remedies available to Purchaser, Purchaser shall be entitled, without proof
of damage, to any and all equitable and injunctive relief. The provisions of
this paragraph 3 shall be binding until April 30, 2001 (the "EXCLUSIVITY
PERIOD").
This Letter shall be deemed terminated automatically upon the
expiration of the Exclusivity Period, unless extended by written consent of
Purchaser and Seller. In such case, neither Purchaser nor Seller shall have
any further obligation or liability (in tort, contract or otherwise) to the
other, except as provided in paragraph 2, which obligation shall survive the
termination of this Letter.
4. NEGOTIATION OF DEFINITIVE AGREEMENTS. Subject to the terms and
conditions of this Letter, the parties agree to enter into good faith
negotiations toward the preparation, execution and delivery of definitive
agreements that shall set forth the terms and conditions of the Transaction as
described in this Letter (the "DEFINITIVE AGREEMENTS"). The terms and provisions
of the Definitive Agreements shall be mutually acceptable to the parties. The
Definitive Agreement will contain mutual general releases The Definitive
Agreements shall be prepared by Purchaser's counsel and approved by the parties.
5. CLOSING CONDITIONS. The closing of the Transaction shall be
contingent upon conditions customary to transactions of this nature, including,
but not limited to, the following:
(a) receipt of all applicable regulatory approvals (including the
Indiana Gaming Commission ("IGC")) required for the completion of the
Transaction;
(b) the expiration of any waiting periods required under the HSR Act or
other applicable law or regulation;
(c) Seller and Purchaser shall both be satisfied with the ruling of IGC
with respect to Seller's prior pledge to Xxxxx Fargo Bank NA of the
Centaur Interest; and
(d) the interest of Conseco Entertainment LLC in the Partnership shall
have been acquired by the Purchaser or an affiliate.
6. NON-BINDING NATURE. Except as to paragraphs 2, 3, 4 and 5 hereof,
the parties hereto understand and agree that this Letter sets forth the parties'
current understanding of agreements, which may be set out in a binding fashion
in the Definitive Agreements to be executed at a later date. Except as to
paragraphs 2, 3, 4 and 5 hereof, this letter does not create and is not intended
to create a binding and enforceable contract between the parties and may not be
relied upon by either party as the basis for a contract by estoppel or
otherwise, but rather evidences a non-binding expression of good faith
understanding to endeavor, without obligation, to negotiate mutually agreeable
Definitive Agreements.
7. GOVERNING LAW. The rights and obligations set forth in this Letter
shall be governed by the laws of the State of Indiana, without regard to
principles of conflicts of laws thereof.
8. SUCCESSOR AND ASSIGNS. This Letter and the rights and obligations of
Seller and Purchaser shall not be assignable.
9. AMENDMENT. This Letter may only be amended or modified by a writing
executed by Xxxxxx and Purchaser.
If the terms and conditions of this Letter are in accord with your
understanding, please sign and return a counterpart of this Letter no later than
5:00 p.m. (EST) January 23, 2001, after which date, if not returned, this Letter
shall be null and void.
Very truly yours,
ARGOSY GAMING COMPANY
By: /s/ Xxxx X. Xxxxx
------------------------------
Name: Xxxx X. Xxxxx
------------------------------
Title: Sr. Vice President and CFO
------------------------------
Acknowledged and agreed to this 22nd day of January, 2001.
CENTAUR, INC.
By: /s/ Xxxx X. Xxxxxx
--------------------------
Name: Xxxx X. Xxxxxx
--------------------------
Title: President
--------------------------
