AGREEMENT FOR PURCHASE AND SALE OF BUSINESS ASSETS
THIS AGREEMENT, is entered into and dated as of the 6 th day of February,
1998, by and between Stage Stop Gaming Hall, Inc. ("Buyer"), and Gold Coin
Incorporated, a Delaware corporation, d/b/a Lady Luck Gold Coin Gambling Hall &
Saloon in Central City, Colorado ("Seller").
RECITALS:
This Agreement is made with reference to the following facts and
objectives:
(A) Seller, owns certain assets associated with its business known as Lady
Luck Gold Coin Gambling Hall & Saloon in Central City, Colorado,("Premises"),
(and is hereinafter referred to as the "Business") and it desires to sell a
substantial portion of such Assets to Buyer upon the terms and conditions set
forth in this Agreement.
(B) Buyer desires to purchase such assets of Seller upon the terms and
conditions set forth in this Agreement.
(C) In addition to physical assets, Buyer desires and Seller desires to
terminate in favor of Buyer certain licenses, permits, rights and other similar
assets so as to enable Buyer to operate a limited gaming casino at the Premises.
(D) Seller is liable to Buyer pursuant to that certain Promissory Note and
Deed of Trust dated May 31, 1991 ("Loan") assumed by Seller. Buyer, subject to
the terms, conditions, and provisions of this Agreement agrees to have the Note
Holder, currently X.X. Xxxxxxx, execute and deliver to Seller a covenant not to
xxx Seller on the Loan. Buyer shall also provide Seller an appropriate release
from any personal liability on the Loan executed by Note Holder in a form
reasonably satisfactory to the parties.
(E) Seller for the mutual promises set out herein, and as further
consideration for and an inducement to Buyer to enter into this transaction, are
willing to undertake certain obligations as provided herein:
AGREEMENT:
NOW, THEREFORE, in consideration of the recitals and the mutual agreements,
provisions, and covenants herein contained, the parties hereto hereby agree as
follows:
1. Sale of Assets. Except as provided herein, Seller hereby sells, conveys,
assigns, transfers, and delivers to Buyer, the following described properties
and assets, free and clear of all liens and encumbrances:
1.1 Inventory and Supplies. All inventory and supplies of Seller shall be
transferred to Buyer, except as excluded on Schedule 2. Seller shall maintain
the inventory level from the date of this agreement and Closing in its normal
course of business. Buyer shall be entitled to have an itemized physical
inventory be taken by Buyer and Seller as set forth in Section 9 of this
Agreement.
1.2 Furniture, Equipment, and Machinery. All items of furniture, equipment,
machinery, fixtures, tools, devices, vehicles, and other tangible personal
property shall be described on Schedule 1.2 pursuant to Section 9 of this
Agreement which shall include, but not be limited to the tangible personal
property located as of the date of this Agreement on the Premises ("Casino F,F &
E") (collectively "Fixed Assets") , except as excluded on Schedule 2. At
closing, Seller shall issue its warranty to Buyer that the Casino F,F & E, to
the best of Seller's knowledge, is in good working condition, except as
disclosed in writing to Buyer on or before February 10, 1998. Seller agrees that
limited gaming devices shall be transferred to Buyer, at no additional cost or
expense to Buyer by one who holds a proper license to do so, e.g. IGT
1.3 Surrender and Transfer of Licenses. All right, title and interest of
Seller in any licenses it holds for and at the Premises for limited gaming,
liquor, and the like to operate its Business shall be terminated, surrendered,
or canceled along with all other obligations imposed by the applicable local and
Colorado governmental agencies concurrent with the Closing.
1.4 Trade Name, Trademark, and Service Xxxx. All right, title, and interest
in the Trade Name, Trademark, Service Xxxx, Registrations, and pending
Applications for Registration, if any for "Gold Coin," and other similar names,
(the "Name"). Following Closing Seller shall amend its Articles of Incorporation
to a name dissimilar to the "Name" which shall be the property of Buyer. Seller
shall release and waive any and all rights thereto and will not make use thereof
after Closing.
1.5 Leases and Contracts. All of Seller's right, title and interest in and
to the leases, contracts, purchase and sales contracts, and other agreements
listed on Schedule 1.5 attached hereto, true and correct copies of which shall
be delivered to Buyer by Seller.
1.6 Other Assets; Consent of Third Parties. If assignment or transfer of
any assets shall require the consent of any party thereto other than Seller,
this Agreement shall not constitute an agreement to assign the same, and such
items shall not be assigned to nor assumed by Buyer if an actual or attempted
assignment thereof would constitute a breach or default thereunder. Seller shall
use its reasonable efforts to obtain such consents, to the extent required, of
such other parties to such items. If any such consent cannot be obtained, Seller
will cooperate in any reasonable arrangement designed to obtain for Buyer all
benefits and privileges of the applicable item while protecting Seller from
continuing liabilities or obligations thereunder. Seller's "Gold Coin" tokens
shall be transferred to Buyer, for which Buyer agrees to assume redemption
liability for all outstanding "Gold Coin" tokens. Buyer shall also receive all
furniture and equipment at Seller's office located in Golden Colorado, and its
warehouse/storage facility in Colorado, such items are transferred in an AS IS,
WHERE IS CONDITION, which Buyer shall cause to be removed from such location(s)
following Closing. All books and records of Seller relating to the Assets shall
be retained by Seller and shall remain in its physical possession. Buyer,
however, may reasonably inspect, copy, examine, and review all of said books and
records, at the Premises, or within the greater Denver metropolitan area,
without restriction following the date hereof.
1.7 Customer Lists. All lists of customers of Seller, both active and
inactive, associated with its Business.
1.8 Slot Club Liability; Payment to Buyer at Closing. Buyer agrees to
assume redemption liability for all outstanding "points" or script to members of
Seller's Mad Money Slot Club of the Business. Seller agrees to pay to Buyer at
Closing the sum of $12,000.00 due to replacement or repair of the carpet at the
Premises, Buyer agrees to accept the condition of the carpet.
1.9 Leasehold Improvements. All improvements made to the Premises which are
not otherwise fixtures or part of the real estate transferred to the Buyer
pursuant to the terms of the attached Commercial Contract to Buy and Sell Real
Estate.
2. Excluded Assets. Except as otherwise agreed, Buyer shall not purchase
any of Seller's cash or those assets described on Schedule 2 and shall not
purchase or assume any contract or agreement other than those described on
Schedule 1.5.
3. Consideration Payable to Seller by Buyer. Subject to the terms and
conditions of this Agreement, and in reliance upon the representations and
warranties of Seller herein contained, and in consideration of the sale,
conveyance, assignment, transfer and delivery by Seller of the Assets pursuant
to Section 1 hereof, Buyer agrees as follows:
3.1 Purchase Price for the Assets. The purchase price for the Assets
described in Section 1 and the Real Estate as described in the attached
concurrent Contract to Buy and Sell Real Estate for the Premises (120 Main
Street, Central City, Colorado 80427) shall be the agreement of Buyer to have
the Note Holder at Closing execute a covenant not to xxx Seller on the existing
Promissory Note and Deed of Trust dated May 31, 1991 ("Loan") valued at the
outstanding balance of the "Loan" (which principal balance as of the date of
this Agreement and the concurrent Contract is agreed upon to be $2,750,000.00)
dated May 31, 1991, and recorded June 6, 1991 in Book 512 at Page 426 in the
Clerk and Recorder's Office of the County of Xxxxxx, State of Colorado, and to
supply to Seller an appropriate release from personal liability on the loan in a
form reasonably satisfactory to the parties.
3.1A Xxxxxxx Money. (Omitted)
3.1B Down Payment. (Omitted)
3.1C Assumption of Debt. (Omitted)
3.1D Balance and Terms. (Omitted)
3.2 Assumption of Liabilities. From and after the Closing Date, Buyer shall
assume and agree to pay, perform and discharge the obligations of Seller
accruing from and after the Closing Date only with respect to the lease and
other contracts described in Sections 1.5, and 1.6. Buyer does not assume and
shall not be deemed to have assumed any other liability or obligation of Seller.
3.3 Allocation of Purchase Price. The parties hereto agree that the
Purchase Price shall be allocated to the Assets in accordance with this section
after inventory pursuant to Section 9 of this Agreement and a written allocation
of the Purchase Price shall then be completed, and attached to this Agreement as
Schedule 3.3.
The parties hereto acknowledge that such allocation, when agreed upon in
writing between the parties, will represents the fair market value of the Assets
and shall be binding upon the parties hereto for federal and state tax purposes.
The parties shall agree, in writing, on or before the Deadline Date on such
written allocation of purchase price, as a condition precedent to this
agreement.
4. Ancillary Agreements. The transaction contemplated herein includes the
parties hereto entering into certain additional agreements, as enumerated in
this Section 4, which shall be executed and delivered simultaneous with the
execution of this Agreement (the "Ancillary Agreements"). All such Ancillary
Agreements shall be agreed to between Buyer and Seller, in writing, on or before
the "Deadline Date", as a condition precedent to this Agreement.
4.1 Consulting Agreement. The parties agree that Seller shall, without cost
to Buyer, familiarize and acquaint Buyer with all material aspects of Seller's
Business from the date of Closing and for thirty (30) working days from the day
of Closing.
4.2 Non-Compete Agreement. (Omitted)
4.3 Assumption and Assignment Agreement. The parties agree to enter into an
Assumption and Assignment Agreement in substantially the form as set forth as
Schedule 4.3 ("Assumption and Assignment Agreement").
4.4 Corporate Restrictions. (Omitted)
5. Prior to Closing.
5.1 Operation Of The Company Prior To Closing. Seller hereby agrees, from
the date of execution of this Agreement to Closing, to carry on its business
activities and operations diligently and in substantially the same manner as has
been customary in the past. It is the intent of both parties to have Buyer
acquire the assets and to minimize the time period where the Premises would be
closed or not open to the public. Notwithstanding the foregoing, the parties
recognize and agree that for a period immediately prior to Closing, which shall
not exceed two (2) calendar days, Seller will need to close its Business at the
Premises to fulfill its obligations to both the City and State license law
officials, including surrender or termination of its respective liquor and
limited gaming licenses to permit issuance of like licenses to Buyer
("Closure").
5.2 Company Premises And Assets. Except as provided for in subsection 5.1
above, until Closing and possession is given to Buyer, Seller agrees to operate
and maintain the Premises and the Assets in good working order and condition.
5.3 Loss/Damage. In the event there is any loss or damage to the Premises
or the Assets at any time prior to Closing, the risk of loss shall be upon the
Seller. From Closing and thereafter, all risk of loss or damage shall be upon
Buyer.
5.4 Deadline Date. The parties agree whenever the term "Deadline Date" is
utilized in this Agreement, that on or before February 5, 1998, shall be the
date and meaning of the term "Deadline Date".
6. Closing. Closing will take place at a time and date mutually agreeable
to the parties, but in no event later than February 13, 1998 ("Closing Date"),
unless extended in writing by the parties hereto. Notwithstanding the foregoing,
in the event Seller is unable to obtain the necessary consents and releases to
permit title to the Assets to be transferred to Buyer free and clear of all
liens, Closing shall be extended by written notice from Seller to Buyer to a
date certain acceptable to both parties, and if not previously tendered, Seller
shall remit interest due and payable to X.X. Xxxxxxx pursuant to the terms of
the Promissory Note. Any such extended Closing Date shall be not less than three
(3) calendar days from the prior Closing Date. If Closing does not occur on or
before March 13, 1998 this contract shall terminate, and the parties shall be
relieved of all obligations hereunder
7. Buyer's Obligations at Closing. At Closing, Buyer shall:
7.1 Deliver Documents. Deliver to Seller, executed duplicate originals of:
(A) Such other general assignments or successor agreements regarding any
contract or Assent, such as the business telephone number, which Buyer is
assuming and agreeing to pay.
(B) Execute and deliver the documents set forth in Sections 3.1C and 3.2,
and any other documents required in this Agreement..
(C) Corporate authority of the Buyer to execute the Agreement, Contract,
and the Ancillary Agreements and other documents pursuant to the terms of this
Agreement.
(D) Buyer shall deliver, pursuant to Section 3.1, the executed Covenant Not
to Xxx Seller on the Promissory Note and Release of Seller from the Loan.
8. Seller's and Shareholders' Obligations at Closing. At Closing, Seller
and Shareholders shall:
8.1 Deliver Documents. Deliver to Buyer, executed duplicate originals of:
8.1A Such other general assignments or successor agreements regarding any
contract or assent, such as the business telephone number, which Buyer is
assuming and agreeing to pay.
8.1B Except as set forth in 8.1C, a General Warranty Xxxx of Sale conveying
to Buyer the Assets of the Business pursuant to Section 1.2 of this Agreement)
to be transferred pursuant to this Agreement, the form of the Xxxx of Sale shall
be mutually agreed upon by the parties. Such agreement as to form of the Xxxx of
Sale shall be agreed upon in writing between the parties on or before the
Deadline Date.
8.1C A General Warranty Xxxx of Sale from a licensed limited gaming device
vendor for all of the gaming devices pursuant to Section 1.3. At closing, Seller
shall issue its warranty to Buyer that the Casino F,F & E, to the best of
Seller's knowledge, is in good working condition, except as previously disclosed
in writing to Buyer pursuant to subsection 1.2 of this Agreement. All other
included assets and items shall be transferred to Buyer in an AS IS, WHERE IS
CONDITION. Seller agrees that limited gaming devices shall be transferred to
Buyer, at no additional cost or expense to Buyer by one who holds a proper
license to do so, e.g. IGT
8.1D Termination, surrender, or cancellation of all right, title and
interest of Seller in any licenses it holds for and at the Premises for limited
gaming, liquor, and the like to operate its Business along with fulfillment of
all other obligations imposed by the applicable local and Colorado governmental
agencies concurrent with the Closing.
8.1E Transfer to Buyer all right, title, and interest in the Trade Name,
Trademark, Service Xxxx, Registrations, and pending Applications for
Registration, if any for "Gold Coin," and other similar names, (the "Name").
Seller shall release and waive any and all rights thereto and will not make use
thereof after Closing. Following Closing Seller shall amend its Articles of
Incorporation to a name dissimilar to the "Name" which shall be the property of
Buyer.
8.1F Evidence that Seller has paid or at Closing will pay all taxes and
obligations, accrued as of the date of Closing, including but not limited to all
social security, withholding, head, sales, xxxxxxx'x compensation, unemployment
insurance, gaming taxes and device fees (taxes based on AGP and device fees,
local and state) and income taxes to all applicable taxing, governmental or
other authorities.
8.2 Instruments of Conveyance. Execute and deliver such assignments, bills
of sale, endorsements, notices, consents, and assurances and such other
instruments of conveyance and transfer as counsel for Buyer shall reasonably
request and as shall be effective to vest in Buyer good and marketable title to
all of the Assets. Simultaneously with such delivery, Seller shall take all such
steps as may be necessary to put Buyer in actual possession and control of the
Assets. Seller further agrees that it will at any time, and from time to time
after the Closing Date, upon the reasonable request of Buyer and without
additional consideration, do, execute, acknowledge and deliver, or will cause to
be done, executed, acknowledged and delivered, all such further acts, deeds,
assignments, transfers, conveyances, powers of attorney and assurances as may be
required in conformity with this agreement for the better assigning,
transferring, granting, conveying, asserting and confirming to Buyer or to its
successors and assigns, or for aiding and assisting in collecting and reducing
to possession, any or all of the Assets or other properties sold, conveyed,
assigned, transferred and delivered at the Closing to Buyer as provided herein.
Both parties agree to execute any post closing documents reasonably required of
the other party.
8.3 Resolutions. Deliver a copy of the Resolution of the Board of Directors
and the Shareholders of Seller authorizing the transaction contemplated by this
Agreement, certified by the Secretary or any Assistant Secretary of Seller.
9. Settlement; Inventory. By mutual agreement of the parties, but not later
than the day before the Closing Date, Seller and Buyer shall jointly conduct and
complete a physical count of all included assets to be purchased by Buyer
hereunder ("Inventory Date"). Seller and Buyer shall jointly prepare a written
inventory report which shall contain the description and quantity of such item
and the value of each item of Inventory and other included assets. As set forth
in this Agreement, the value of the Inventory being purchased by Buyer, as thus
quantified and priced, shall be included in a written settlement statement
jointly prepared by Seller and Buyer, which shall also set out the amount
attributed toward the Purchase Price for such Inventory and Assets described in
Section 3 above.
10. Representations, Warranties and Covenants of the Seller . Seller hereby
represents, warrants, and covenants to and with Buyer as follows:
10.1 Organization, Good Standing and Corporate Power. Seller is a
corporation duly organized, validly existing and in good standing under the laws
of the state of Delaware and has the regulatory and corporate power to own,
operate and lease its properties and carry on its business as now being
conducted in Colorado.
10.2 Corporate Authorization; Binding Effect. The execution, delivery and
performance of this Agreement by Seller has been duly authorized by the Board of
Directors and all of its Shareholders. This Agreement, the Ancillary Agreements,
and the consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary corporate action on the part of Seller and
constitutes the legal, valid and binding obligations of Seller enforceable in
accordance with their terms.
10.3 No Conflict With Other Instruments or Agreements. The execution,
delivery and performance of this Agreement and the Ancillary Agreements by
Seller will not result in a breach or violation of, or constitute a default
under Seller's Articles of Incorporation or By-Laws, or any agreement to which
Seller is a party or by which Seller is bound or to which any of its property is
subject and will not be in violation of any statute, judgment, order, rule or
regulation of any court, or any federal, state or other regulatory authority or
governmental body having jurisdiction over Seller in effect at the date hereof.
10.4 No Governmental Authorization Required. No consent, approval,
authorization or order of, or qualification with, any court, regulatory
authority or other governmental body is required for the consummation by Seller
of the transactions contemplated by this Agreement.
10.5 Licenses, Certificates Or Permits. Seller hereby warrants that any and
all licenses, certificates or permits necessary to continue the operation of the
Business are current and valid up to the time of Closure of the Business (as
defined in subsection 5.1 of this Agreement). Except as set forth in writing and
delivered to Buyer, Seller hereby warrants that said licenses, certificates or
permits have never been suspended or revoked and that there are no proceedings,
in progress or threatened, to suspend or revoke said licenses, certificates or
permits, except where such suspension or revocation has not had a material
adverse affect on the Business.
10.6 Title to Assets, Absence of Liens, Condition of Assets. Except as
provided in this Agreement, Seller has good and marketable title and ownership,
and will transfer to Buyer title to all of the Assets, free and clear of all
pledges, liens, defects, leases, licenses, equities, conditional sales
contracts, charges, claims, security interests, restrictions, chattel mortgages.
The Assets are sold to Buyer in the condition as warranted pursuant to
subsection 8.1C of this Agreement. Seller does not know of any latent defects in
the Assets or the Premises.
10.7 Assets. There is no asset used by Seller in its operation of the
Business (other than those Excluded Assets referred to in Schedule 2 above)
which is not transferred to Buyer pursuant to this Agreement.
10.8 Compliance With Agreement. Seller, to the best of Seller's knowledge,
is not in breach of, or in default under, any agreement, contract or commitment
described in Section 1.5. All such contracts and agreements are, and after
consummation of the transactions contemplated herein, will be legal, valid and
binding obligations of the respective parties thereto, to the best of Seller's
knowledge.
10.9 Financial Statements. (Omitted)
10.10 Conduct of Business Since . Since 1993,:
10.10A (Omitted) 10.10B (Omitted) 10.10C (Omitted) 10.10D (Omitted) 10.10E
(Omitted)
10.10F Seller represents, warrants and agrees that all outstanding
liabilities of Seller shall be paid in full on or before Closing and that Buyer
shall receive possession and control of the Assets and all other rights acquired
herein, free and clear of any encumbrances, excepting for Loan in favor of Buyer
and assumed by Seller which is the subject of the Covenant Not to Xxx described
in this Agreement and the Contract to Buy and Sell Real Estate. Seller further
warrants that it has paid and will pay all taxes and obligations, as they come
due, including but not limited to all gaming taxes and device fees (taxes based
on AGP and device fees, local and state) social security, withholding, head,
sales xxxxxxx'x compensation, unemployment insurance, and income taxes to date
of Closing to all applicable taxing authorities.
10.11 Absence of Undisclosed Liabilities. Except as and to the extent
reflected in the Financial Statements or Schedule 10.10, Seller did not have, as
of the date of the Financial Statements, and as of the Date of Closing, any
material (individually or in the aggregate) liabilities (secured or unsecured
and whether accrued, absolute, direct, indirect, contingent or otherwise).
10.12 Litigation. Seller, to the best of Seller's knowledge, represents,
warrants and covenants that there are no claims, legal actions or governmental
investigations threatened against Seller which, if adversely determined, would
have a material adverse effect on the Assets or the Business. To the best of
Seller's knowledge there are no orders, decrees, judgments or agreements with
any court or governmental authority by which Seller or the Assets are bound.
Seller does not have any knowledge of any facts or contemplated event which, as
far as reasonably can be foreseen, may give rise to any claim, action, suit,
proceeding, complaint, investigation or inspection which could materially
adversely affect the Assets.
10.13 List of Contracts and Other Data. Schedule 10.12 sets forth, as of
the date of this Agreement, a listing of the following, true and correct copies
of which have been furnished to Buyer:
10.13A All existing contracts and commitments which are material to the
Business (including without limitation, mortgages, licenses, leases, indentures,
guaranty and indemnification agreements, loan agreements, dealer, franchise
distribution agreements, advertising contracts, patent, trademark and similar
licenses, and other agreements and contracts), whether written or oral, to which
Seller is a party, relating to the Assets or the business operated by Seller at
the Business.
10.13B All material employment and consulting agreements, executive
compensation plans, bonus plans, deferred compensation agreements, employee
pension plans, employee stock ownership plans or retirement plans, severance pay
plans, employee profit sharing plans, thrift plans, savings-plans, group life
insurance, hospitalization insurance, or other plans or arrangements, and all
union or labor contracts, whether written or oral, providing for benefits for
employees of Seller at the Business.
10.13C (Omitted.)
10.14 Labor Matters. Seller is not a party to any collective bargaining
agreements affecting the Business. On the date hereof, there are no material
controversies pending or, to the knowledge of Seller or Shareholders, threatened
between Seller and any of its employees.
10.15 Compliance with Laws. The Assets, Premises, and all assets subject to
leases described in Schedule 1.5 are being used and occupied, and are located
and constructed, in compliance with, and conform to all applicable federal,
state and local laws, rules, regulations and ordinances, except where failure to
conform would not have a material adverse effect on the Business. Seller, to the
best of Seller's knowledge, hereby warrants that the Premises, and Assets are in
full compliance with all federal, state and local building, fire, safety, health
and environmental requirements; and that, if any expenses are necessary to bring
the Premises or Assets into compliance with any such governmental requirements,
those expenses shall be the sole responsibility of, and will be paid by Seller.
Seller shall also be responsible for compliance with all employment laws
including Family Medical Leave Act, Department of Labor laws, whether such laws
are Federal or State in nature.
10.16 Relationship With Suppliers and Customers. (Omitted.)
10.17 Brokers and Finders. Seller has not employed any investment banker,
broker or finder, or incurred any liability for any brokerage fees, commissions
or finders fees in connection with the transactions contemplated by this
Agreement. Seller shall be solely liable to pay any monies due any Broker not
engaged by Buyer.
10.18 Environmental Matters. For purposes of this Section 10.18, "Hazardous
Substances" shall mean any pollutants, contaminants or other dangerous, toxic or
hazardous chemicals, wastes, materials or substances as defined in or governed
by any federal, state or local statute, law, regulation or other requirements
relating to any Hazardous Substance or otherwise relating to human health and
safety or the environment, and also including any urea-formaldehyde,
polychlorinated bipheyls, asbestos-containing materials, petroleum products, and
any other waste, material, substance, pollutant or contaminant which might
subject the owner of the Assets or the Business to any claims, demands, damages,
costs, expenses or other liabilities under any applicable statute, law,
regulation or other requirements. The warranties and representations set forth
in this Subsection 10.18, are restricted to the Seller's knowledge as of the
date of Closing and are further restricted to solely those matters which first
occurred during Seller's ownership of the Premises. Seller, if it has possession
of a Phase I Environmental Study of the Premises shall promptly provide a copy
to Buyer.
No person or entity has asserted against Seller or Shareholders any
demands, damages, costs, expenses, causes of action or claims, however defined
arising out of or due to (a) the emission, disposal, discharge or other release
or threatened release of any Hazardous Substances in connection with the
Business or Assets first occurring during the period of Seller's ownership of
the Premises or (b) any injury to human health or the environment by reason of
the condition, of the Business or the Assets but only to the extent such
condition first occurred and came into being during the period of Seller's
ownership of the Premises.
During the period of Seller's Ownership of the Premises, there is not, and
has not been, any emission, disposal, discharge or release or threatened release
at or from the Assets or the Business of any Hazardous Substances; no part of
the Assets or the Business has been used as a landfill, dump or other disposal
area for Hazardous Substances, no underground storage tanks (whether or not
currently in use) have been located at the Assets or the Business; no Hazardous
Substances are located at the Assets or the Business except as may be listed on
Schedule 10.17; and there have been no investigations, inspections, or inquiries
of any kind with respect to the Assets or the Business by any governmental
authority which in any way pertain to Hazardous Substances or the violation or
potential violation of any Environmental Laws (defined below). Seller is not
currently being charged with any violation of, and to the best of Seller's
knowledge, Seller is now operating, and at all times has operated the Business
and the Assets in compliance with all applicable foreign, federal, state and
local statutes, laws or regulations or other requirements relating to the
environment or human health and safety, including, but not limited to, laws or
regulations relating to emissions, disposals, discharges, releases or threatened
released of Hazardous Substances into ambient air, surface water, ground water,
or land, or otherwise relating to the manufacture, processing, distribution,
use, treatment, storage, disposal, transport or handling of Hazardous Substances
("Environmental Laws). No expenditures will be required in order for Buyer to
comply with Environmental Laws in force as of the date of the Agreement in
connection with the Business and the Assets after Buyer acquires the Assets from
Seller or to clean-up or remove Hazardous Substances which may have been
discharged, emitted, disposed of or released at the Business but only to the
extent any such discharge, emission, disposal or release first occurred during
the period of Seller's ownership of the Premises.
10.19 Disclosure and Reliance. (Omitted.)
11. Representations and Warranties of Buyer. Buyer represents, warrants,
and covenants to and with Seller as follows:
11.1 No Conflict With Other Instruments or Agreements. The execution,
delivery and performance of this Agreement and the Ancillary Agreements by Buyer
will not result in a breach or violation of, or constitute a default under
Buyer's Articles of Incorporation or By-Laws, or any agreement to which Buyer is
a party or by which Buyer is bound and will not be in violation of any statute,
judgment, order, rule or regulation of any court, or any federal, state or other
regulatory authority or governmental body having jurisdiction over Buyer in
effect at the date hereof.
11.2 Organization, Power. Buyer is a corporation duly organized, existing
and in good standing under the laws of the State of Colorado, and has all
requisite corporate power and authority to own, operate and lease its
properties, and to carry on its business as now being conducted and to enter
into this Agreement and perform its obligations hereunder.
11.3 Authority Relative to Agreement. The execution, delivery and
performance of this Agreement by Buyer and the consummation by it of the
transactions contemplated hereby, have been approved by all necessary corporate
action on the part of Buyer and this Agreement constitutes the legal, valid and
binding obligation of Buyer, except as the same may be limited by bankruptcy,
insolvency, reorganization or other laws affecting the enforcement of creditors
rights generally.
11.4 No Government Authorization Required. No consent, approval,
authorization or order of, or qualification with, any court, regulatory
authority or other governmental body is required for the consummation by Buyer
of the transactions contemplated by this Agreement, except as set forth in the
attached Schedule 11.4.
12. Indemnification of Buyer and Seller.
12.1 Indemnity by Seller. Except for those specific obligations and amounts
assumed by Buyer, Seller shall indemnify and hold Buyer harmless against and in
respect of:
12.1A All debts, liabilities and obligations of Seller of any nature,
whether accrued, absolute, contingent, or known or unknown on the date of
Closing, regarding Seller's Business and the Premises including, but not limited
to:
(i) Any liabilities, fines, obligations or other expenses arising out of or
relating to Seller's failure to comply with any relevant corporate or other
federal, state or local laws, rules, ordinances or regulations, or failure to
obtain any relevant governmental permit, license, consent or other
authorization.
(ii) Any liabilities obligations or other expenses resulting from any
breach of contract, tort, product liability, unfair labor or other employment,
unemployment practice, or other claim arising from or with respect to Seller's
business operations and asserted by any employee, creditor, customer, claimant
or other party:
(iii) Any liabilities, obligations or other expenses resulting from any
suit, action, arbitration, charge, governmental investigation, claim, litigation
or proceeding, pending or threatened, affecting any of Seller's properties or
business or the Assets existing or arising on or resulting from events which
occurred or failed to occur on or before the date of Closing, to the extent not
specifically assumed by Buyer hereunder.
12.2 Any damage or deficiency resulting directly or indirectly from any
misrepresentation, breach of warranty, representation, covenant or non
fulfillment of any agreement on the part of Seller under this Agreement, or from
any misrepresentation in or omission from any certificate or other instrument
furnished or to be furnished to Buyer hereunder.
12.3 All other actions, suits, proceedings, demands, assessments,
adjustments, costs and expenses incident to the foregoing, including, without
limitation, actual attorneys' fees and other out-of-pocket expenses.
12.4 Indemnity by Buyer. Buyer shall indemnify and hold Seller harmless
against and in respect of:
(i) All debts, liabilities and obligations of Seller assumed by Buyer;
(ii) Any damage or deficiency resulting directly or indirectly from any
misrepresentation, breach of warranty, representation, covenant or non
fulfillment of any agreement on the part of Buyer under this Agreement, or from
any misrepresentation in or omission from any certificate or other instrument
furnished or to be furnished to Seller hereunder;
(iii) All other actions, suits, proceedings, demands, assessments,
adjustments, costs and expenses incident to the foregoing, including, without
limitation, actual attorneys' fees and other out-of-pocket expenses; and
(iv) Any liability arising from Buyer's operation of the Business and which
first accrues following Closing.
12.5 Notice of Claims. Any party being indemnified pursuant to this Section
12 ("Indemnitee") agrees to give the other party ("Indemnitor") notice of any
and all claims asserted against Indemnitee for which indemnification is or may
be sought under this Section 12 no later than three (3) years from the date of
Closing. Such notice shall be given within a reasonable time after receipt of
written notice of such claim by Indemnitee. Failure to give such notice shall
not abrogate or diminish Indemnitor's obligation under this Section if
Indemnitor has or receives knowledge of the existence of any such claim by any
other means or if such failure does not prejudice Indemnitor's ability to defend
such claim.
12.6 Defense of Claim. In any litigation, administrative proceeding,
negotiation or arbitration pertaining to any claim for which indemnification is
sought under this Section 12. Indemnitee shall have the right to select legal
counsel to represent Indemnitee and to otherwise control such litigation,
proceedings, negotiations and arbitration, subject to the reasonable approval of
Indemnitor , which approval shall not be unreasonably withheld, all such legal
fees shall be at Indemnitor's expense. If Indemnitor shall, within a reasonable
time after notice, fail to defend, Indemnitee shall have the right, but not the
obligation, to undertake the defense of and to compromise or settle the claim or
other matter on behalf, for the account, at the risk of Indemnitor. If the claim
is one that cannot by its nature be defended solely by Indemnitor (including,
without limitation, any federal or state tax proceeding) then Indemnitee shall
make available all information and assistance as Indemnitor may reasonably
request, at Indemnitor's expense.
12.7 Alternative Dispute Resolution..
A. Alternative Dispute Resolution. In the event the parties are not able to
resolve a dispute between them, the Parties shall proceed in good faith to
submit the matter to mediation. In the event the parties fail to resolve the
matter within thirty (30) calendar days from the date written notice requesting
mediation is sent by one party to the other, the parties agree the matter shall
be submitted to binding arbitration. The arbitration shall be governed by
Colorado law and, absent agreement of the parties, shall be conducted in
accordance with the Commercial Arbitration Rules of the American Arbitration
Association. Such Arbitration shall be held in the greater Denver Metropolitan
area. The provisions set forth in this Section shall not apply to any
foreclosure of the Deed of Trust against the Premises.
13. Conditions.
13.1 This Agreement is expressly conditioned upon:
(i) The concurrent closing on the attached and incorporated Contract to Buy
and Sell Real Estate executed by X.X. Xxxxxxx.
(ii) Issuance of a Limited Gaming License and applicable liquor license to
Stage Stop Gaming Hall, Inc. on or before February 13, 1998.
(iii) This Contract is also conditional upon Seller obtaining at or before
Closing consent or amendment to any obligations of Seller held by third parties
to assign, transfer and convey the Assets to Buyer free of all liens.
In the event the foregoing conditions shall not be satisfied or waived on
or before said date, any and all xxxxxxx monies shall be returned to Buyer
forthwith, and this Agreement shall be null, void, and of no further force and
effect, and each party hereto shall be released from any and all further
liability or obligations hereunder. Buyer may, at Buyer's sole election, waive
the foregoing condition. In the event Buyer proceeds to Closing, Buyer shall be
deemed to have waived said condition.
13.2 Inspection; Due Diligence. This Agreement is expressly conditioned
upon Buyer's inspection of and investigation of the Premises, Assets and the
Business on or before February 11, 1998 ("Inspection Deadline"). If written
notice, signed by Buyer, of any unsatisfactory condition of the Assets or
Business, is not received by Seller on or before said Inspection Deadline, the
same shall be deemed to be satisfactory to the buyer. If written notice of any
unsatisfactory material condition, signed by Buyer is given to the Seller,
Seller, at its sole option, may correct such unsatisfactory condition. If Seller
shall not have corrected said unsatisfactory material condition, or if Buyer
shall not have waived the objection which Buyer has registered on or before the
Closing Date, this contract shall terminate and this contract shall be null and
void and of no other force and effect, and each party hereto will be released
from any and all further liability or obligations hereunder and all xxxxxxx
monies shall be returned to the Buyer forthwith.
13.3 UCC Search. Seller shall, at its sole cost and expense, deliver to
Buyer on or before February 6, 1998 copies of all financing statements, security
agreements and other liens as well as the certification from the Secretary of
State's office (or other provider acceptable to Buyer) the UCC search as to any
filed or other liens, against the Seller or any of the Assets.
13.4 Condition Precedent. Whenever this Agreement references certain action
and written agreement on or before the "Deadline Date", as previously defined in
this Agreement, failure of the parties to agree to the same in writing, shall
result in a termination of the obligations of both Buyer and Seller under this
Agreement.
14. Expenses and Sales Taxes. Except as otherwise provided herein, each
party hereto shall pay its own costs and expenses incurred in connection with
the negotiation and preparation of this Agreement and the consummation of the
transaction contemplated herein; provided, however, that the Seller shall pay
any sales and use taxes accrued to the Closing Date on those Assets subject to
such local or state sales and use taxes. Any sales or use tax resulting from the
transfer of the subject assets from Seller to Buyer shall be paid by Seller at
the time of Closing. Personal property taxes shall be paid by Seller to date of
Closing with evidence of a Certificate of Taxes furnished to Buyer on or before
Closing.
15. Employee Matters. Buyer shall have no obligation to hire or employ any
of Seller's employees at the Business. Seller shall indemnify and hold Buyer
harmless from and against all liabilities which may exist by virtue of any
local, state or federal laws governing the relationship between Seller and its
employees. Except as allowed by Seller, prior to Closing, Buyer to keep this
matter confidential and disclosure to employees will be solely through the
Seller or by joint announcement. Seller consents that Buyer and its
representatives may interview any employee of Seller.
16. Miscellaneous. The following miscellaneous provisions shall apply to
this Agreement.
16.1 Notices. All notices which are required or may be given pursuant to
the terms of this Agreement shall be in writing and delivered personally or
mailed by Registered, Certified or Express mail, postage prepaid,or courier
(e.g. Federal Express, U.P.S., Airborne) at the expense of sender as follows:
To the Seller: Mr. Xxxx Xxxx, Secretary Gold Coin Incorporated 000 Xxxxxxx
Xxxxxx Xxx Xxxxx, XX 00000
With copy to: Xx. Xxxxx Xxxxxxxx XxXxxxxxx, Will & Xxxxx 00 Xxxxxxxxxxx
Xxxxx Xxx Xxxx, XX 00000
To the Buyer: Xx. X.X. Xxxxxxx, President Stage Stop Gaming Hall, Inc. X.X.
Xxx 00. Xxxxxxx Xxxx, XX 00000
With copy to: Kent Xxx Xxxxxx, Esq. Kent Xxx Xxxxxx, P.C. 0000 X. Xxxxxxxx
Xxxxxxxxx, XX 00000-0000 or at such other addresses as any party hereto shall
have designated by notice in writing to the other parties hereto.
The parties further intend and agree that, in the event not otherwise
specified, ten (10) business days shall be assumed to be commercially reasonable
and adequate notice for such matters as notification of intent to enforce
remedies including, without limitation, the rights of secured party under the
Uniform Commercial Code.
16.2 Waivers. Any party hereto may, by written notice to the other party
hereto, (i) extend the time for performance of any of the obligations or other
actions of the other under this Agreement, (ii) waive any inaccuracies in the
representations and warranties of the other contained in this Agreement or in
any documents delivered pursuant to this Agreement, (iii) waive compliance with
any of the conditions or covenants of the other contained in this Agreement, or
(iv) waive or modify performance of any of the obligations of the other under
this Agreement. Except as provided in the preceding sentence, no action taken
pursuant to this Agreement, including, without limitation, any investigation by
or on behalf of any party, shall be deemed to constitute a waiver by the party
taking such action of compliance with any representations, warranties,
covenants, or agreements, contained in this Agreement. The Waiver by any party
hereto of a breach of any portion of this Agreement shall not operate or be
construed as a waiver of any subsequent breach.
16.3 Survival of Representations, Warranties, Covenants and
Indemnifications. The terms, conditions representations, warranties, covenants,
agreements and Indemnifications contained in this Agreement shall survive the
Closing shall not be merged into any documents or instruments of Closing,
without limitation, provided written notice of any breach is received by the
other party on or before three (3) years from Closing.
16.4 Entire Agreement. This Agreement constitutes the entire agreement
among the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and understandings, oral and written, among the
parties hereto with respect to the subject matter hereof. Time is of the essence
to this Agreement.
16.5 Applicable Law. THIS AGREEMENT AND THE LEGAL RELATIONS AMONG THE
PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF COLORADO.
16.6 Binding Effect, Benefits. This Agreement shall inure to the benefit of
and be binding upon the parties hereto and their respective heirs, successors
and assigns; nothing in this Agreement, express or implied, is intended to
confer on any person other than the parties hereto or their respective heirs,
successors and assigns, any rights, remedies, obligations or liabilities under
or by reason of this Agreement.
16.7 Assignability. Notwithstanding anything contained herein to the
contrary, the foregoing shall not be deemed to permit the assignment by Buyer of
any rights under this Agreement, as this Agreement is not assignable nor
delegable by Buyer, except as provided in this Agreement.
16.8 Effect of Headings. The heading of the various sections and
subsections herein are inserted merely as a matter of convenience and for
reference and shall not be construed as in any manner defining, limiting or
describing the scope or intent of the particular sections to which they refer,
or as affecting the meaning or construction of the language in the body of such
sections.
16.9 Schedules. All Schedules referred to in this Agreement are attached
hereto and are incorporated herein by reference as if more fully set forth.
16.10 (Omitted.)
16.11 (Omitted.)
16.12 (Omitted.)
16.13 (Omitted.)
16.14 Books and Records. Buyer agrees that all books and records and other
information given by Seller to Buyer shall be returned to Seller if Buyer does
not complete this Agreement. In all events, Buyer will keep all matters of
information obtained from said books and records, directly or indirectly, in a
confidential manner and shall not disclose that information to any third
parties, except licensing authorities, governmental authorities and lenders, if
any.
16.15 Modification in Writing. This Agreement may not be amended nor may
any right hereunder be waived, except by an instrument in writing executed by
the parties hereto, or except by the functioning of the appropriate terms
written herein.
16.16 Severability. In the event any provisions hereof are found to be
unenforceable or illegal, the remaining portions hereof shall nonetheless be
enforceable provided that the underlying purposes of this Agreement may be
effectuated thereby.
16.17 Counterparts: Facsimile Execution. This Agreement may be executed in
counterparts, including executed copies transmitted by Facsimile, or other
electronic means, each of which shall constitute an original, but all of which
taken together shall constitute one and the same instrument. Each party shall
exchange and original signed document subsequent to transmitting a facsimile or
electronically transmitted copy.
16.18 Survival of the Covenants. (Omitted.)
16.19 Business Day. In the events any date for performance or any act shall
otherwise fall on a weekend or holiday, the same shall instead be deemed to be
extended to the next succeeding business day.
16.20 Further Cooperation. Each party agrees, in good faith, to cooperate
with the other, and make such further assurances and execute or cause to be
executed such further instruments as may be reasonably requested by the other
party in order that this Agreement may be fully performed in accordance with its
intent and provisions.
16.21 Construction. The language in all parts of this Agreement shall in
all cases be construed as a whole according to its fair meaning, strictly
neither for nor against any party hereto, and without implying a presumption
that the terms thereof shall be more strictly construed against one party by
reason of the rule of construction that a document is to be construed more
strictly against the person who himself or through his agent prepared the same,
it being agreed that representatives of both parties have participated in the
preparation hereof.
16.22 Time of the Essence. Time shall be of the essence with respect to the
performance with the laws of the State of Colorado applicable to contracts made
and performed entirely therein.
16.23 Closing. The business day following completion of the inventory shall
be the Closing Date. For purposes of this Agreement, Closing shall be deemed to
mean the time and place at which documents, and assets shall be executed,
delivered, transferred, tendered, assigned, and/or conveyed pursuant to the
terms of this Agreement.
16.24 Remedies. If any payment or performance due hereunder is not paid,
honored or tendered when due, or any other obligation hereunder is not performed
as provided herein, at the election of the non-defaulting party shall be
entitled to all such remedies available at law, in equity, including, without
limitation specific performance, the right to a receivership, and as provided by
agreement of the parties. Anything to the contrary herein notwithstanding, in
the event of any litigation arising out of this Agreement, any court or
arbitration panel shall award to the prevailing party all reasonable costs and
expenses, including attorney fees.
16.25 Casualty. In the event the Business premises and/or tangible Business
assets to be conveyed hereunder are substantially damaged by fire, flood, or
other casualty between the date of this Agreement and the date of Closing, Buyer
or Seller may avoid the contract and a full refund of all Buyer's xxxxxxx monies
shall be remitted immediately.
IN WITNESS WHEREOF, the parties acknowledge they have read this Agreement,
agree to be bound by this Agreement, and have each executed this Agreement
effective as of the day and year first above written.
BUYER:
Stage Stop Gaming Hall, Inc.
By:
Xx. X.X. Xxxxxxx, President
SELLER:
Gold Coin Incorporated
By:
Mr. Xxxx Xxxx, Secretary
SCHEDULE 1.5
LEASES AND CONTRACTS
VENDOR DESCRIPTION CONTRACT
DATE
Central Bank/Bank Western ATM Machine /93
no copy Muszac Music
Dover Elevator Company Elevator Maintenance 6/8/93
Denver Burglar Alarm Burglar alarm maintenance 6/8/93
Denver Burglar Alarm Fire alarm maintenance 6/8/93
IGT Slot machine maintenance 5/2/97
no copy Terminex Exterminator
Glory Maintenance Coin counter maintenance 4/9/96
no copy BFI Trash Removal
no copy BFI Trash Removal
If Buyer does not receive copies (of the above contracts shown as "no copy") or
does not supply written approval to Seller on or before 2/11/98, such contracts
shall be excluded from this Schedule 1.5.
SCHEDULE 3.3
ALLOCATION OF PURCHASE PRICE
1. Inventory and supplies $ 10,000
2. Furniture, equipment, machines and tokens $ 600,000
3. Building and Improvements $ 1,567,500
4. Land $ 572,500
$ 2,750,000
