Exhibit 2.2
SECOND AMENDMENT
TO
ASSET PURCHASE AGREEMENT
This Second Amendment to Asset Purchase Agreement is made as of October 23,
2002 by and among MEC Lone Star, L.P., a Delaware limited partnership
("Buyer"), Lone Star Race Park, Ltd., a Texas limited partnership ("Lone
Star"), and LSJC Development Corporation, a Texas corporation (together with
Lone Star, "Sellers"), and is made with reference to that certain Asset
Purchase Agreement dated as of March 6, 2002, as amended as of September 30,
2002, among Buyer and Sellers (as amended, the "Agreement"). Capitalized terms
used herein without definition shall have the meanings assigned to such terms
in the Agreement.
AGREEMENT
The parties, intending to be legally bound, hereby agree as follows:
1. AMENDMENTS TO AGREEMENT
1.1 ALLOCATION OF PURCHASE PRICE
Subsections 2.8(b)(i) and (ii) of the Agreement shall be and are hereby
amended in their entirety to read as follows:
"(i) In Tenant's federal income and franchise Tax Returns filed for all
prior taxable years, Tenant reported the Sports Corporation Lease as a
purchase money note (the "Installment Obligation") pursuant to which
Tenant acquired the property subject to the Sports Corporation Lease.
Consistent with the foregoing, the parties agree to report for federal
income tax and Texas franchise tax purposes in a manner consistent
with the following: (A) Buyer's assumption of the Sports Corporation
Lease shall be treated as an assumption of the Tenant's Installment
Obligation; (B) the assets acquired by Buyer from Tenant pursuant to
this Agreement are the Purchased Assets acquired from Tenant, treating
the property subject to the Sports Corporation Lease as owned by
Tenant and sold to Buyer (the "Tenant Assets"); (C) the total sales
price paid by Buyer to Tenant to be reported in Part I, Line 3 of
Treasury Department Form 8594 shall be the sum of (x) $43,971,150 of
the cash portion of the Purchase Price set forth in Section 2.3, (y)
any Assumed Liabilities assumed from Tenant (excluding the PILOT
Agreement as an Assumed Liability for purposes of the calculations in
Sections 2.8(b)(i) and (ii) only) and (z) the Installment Obligation,
which as of December 31, 2001 had a fixed obligation of $19,028,850;
and (D) the fair market value of the Class I and III assets to be
agreed on by the parties in accordance with the procedures set forth
in Section 2.8(b)(iv) below; and (E) the fair market value of the
Class V assets to be reported on Treasury Department Form 8594 shall
be equal to the excess of the sales price as determined under Section
2.8(b)(i)(C) over the aggregate fair market value of the Class I
through Class III assets as determined in clause (D) of this Section
2.8(b)(i), and will be allocated to the individual Tenant Assets
within Class V assets on the Treasury Department Form 8594 in
accordance with the procedures described in Section 2.8(b)(iv) below.
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(ii) The parties agree to report for federal income tax and Texas franchise
tax purposes in a manner consistent with the following: (A) the
actions described in Section 2.9 shall be treated, for federal income
tax purposes only, as Buyer's purchase of the License from Lone Star
and, for Texas franchise tax purposes only, as Buyer's purchase of the
membership interest of New LLC; (B) the total sales price paid by
Buyer to Lone Star to be reported in Part I, Line 3 of Treasury
Department Form 8594 shall be the sum of $36,028,850 of the cash
portion of the Purchase Price set forth in Section 2.3 (minus the
amount allocated to the MBLS assets pursuant to Section 2.8(b)(iii)),
plus the Assumed Liabilities assumed from Lone Star (excluding the
PILOT Agreement as an Assumed Liability for purposes of the
calculations in Sections 2.8(b)(i) and (ii) only); (C) the fair market
value of the Class IV assets and Class V assets to be reported on
Treasury Department Form 8594 shall be zero and $2,022,387,
respectively (as reasonably adjusted by agreement of the parties for
additions and disposals from the execution of this Agreement to the
Closing) with the fair market value of the individual assets in each
such class to be reported on Treasury Department Form 8594 to be
agreed by the parties in accordance with the procedures described in
Section 2.8(b)(iv) below and the fair market value of the Class I
through III assets to be agreed on by the parties in accordance with
the procedures set forth in Section 2.8(b)(iv) below; and (D) the fair
market value of the Class VI assets to be reported on Treasury
Department Form 8594 shall be equal to the excess of the sales price
as determined in clause (B) above over the aggregate fair market value
of the Class I through Class V assets as determined in clauses (A)
through (C) of this Section 2.8(b)(ii), and will be allocated solely
to the License."
1.2 PERMITTED EXCEPTIONS
Exhibit L to the Agreement shall be and is hereby replaced in its entirety
by Exhibit L attached hereto.
2. GENERAL PROVISIONS
2.1 AGREEMENT NOT OTHERWISE AFFECTED
Except as expressly amended pursuant hereto, the Agreement shall remain
unchanged and in full force and effect and is hereby ratified and confirmed in
all respects.
2.2 FURTHER ASSURANCES
The parties agree (a) to furnish upon request to each other such further
information, (b) to execute and deliver to each other such other documents and
(c) to do such other acts and things, all as the other party may reasonably
request for the purpose of carrying out the intent of this Second Amendment
and the documents referred to in this Second Amendment.
2.3 WAIVER
Except as otherwise expressly provided in this Second Amendment, the rights
and remedies of the parties to this Second Amendment are cumulative and not
alternative. Neither the failure nor any delay by any party in exercising any
right, power, or privilege under this
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Second Amendment or the documents referred to in this Second Amendment will
operate as a waiver of such right, power, or privilege, and no single or
partial exercise of any such right, power, or privilege will preclude any
other or further exercise of such right, power, or privilege or the exercise
of any other right, power, or privilege. To the maximum extent permitted by
applicable law, (a) no claim or right arising out of this Second Amendment or
the documents referred to in this Second Amendment can be discharged by one
party, in whole or in part, by a waiver or renunciation of the claim or right
unless in writing signed by the other party; (b) no waiver that may be given
by a party will be applicable except in the specific instance for which it is
given; and (c) no notice to or demand on one party will be deemed to be a
waiver of any obligation of such party or of the right of the party giving
such notice or demand to take further action without notice or demand as
provided in this Second Amendment or the documents referred to in this Second
Amendment.
2.4 ENTIRE AGREEMENT AND MODIFICATION
This Second Amendment, together with the Agreement, supersedes all prior
agreements between the parties with respect to its subject matter and
constitutes (along with the documents referred to in this Second Amendment) a
complete and exclusive statement of the terms of the agreement between the
parties with respect to its subject matter. This Second Amendment may not be
amended except by a written agreement executed by the party to be charged with
the amendment.
2.5 ASSIGNMENT, SUCCESSORS AND NO THIRD-PARTY RIGHTS
No party may assign any of its rights under this Second Amendment without
the prior consent of the other parties. Subject to the preceding sentence,
this Second Amendment will apply to, be binding in all respects upon, and
inure to the benefit of the successors and permitted assigns of the parties.
Nothing expressed or referred to in this Second Amendment will be construed to
give any Person other than the parties to this Second Amendment and the
Indemnified Persons any legal or equitable right, remedy, or claim under or
with respect to this Second Amendment or any provision of this Second
Amendment. This Second Amendment and all of its provisions and conditions are
for the sole and exclusive benefit of the parties to this Second Amendment and
their successors and assigns.
2.6 SEVERABILITY
If any provision of this Second Amendment is held invalid or unenforceable
by any court of competent jurisdiction, the other provisions of this Second
Amendment will remain in full force and effect. Any provision of this Second
Amendment held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
2.7 GOVERNING LAW
This Second Amendment will be governed by the laws of the State of Texas
without regard to conflicts of laws principles.
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2.8 COUNTERPARTS
This Second Amendment may be executed in counterparts, each of which will be
deemed to be an original copy of this Second Amendment and all of which, when
taken together, will be deemed to constitute one and the same agreement.
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IN WITNESS WHEREOF, the parties have executed and delivered this Second
Amendment as of the date first written above.
MEC LONE STAR, L.P.,
a Delaware limited partnership
By:MEC TEXAS RACING, INC.,
a Delaware corporation, its general partner
By:
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Name:
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Title:
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LONE STAR RACE PARK, LTD.,
a Texas limited partnership
By:LONE STAR RACE PARK
MANAGEMENT CORPORATION,
a Texas corporation, its general partner
By:
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Name:
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Title:
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LSJC DEVELOPMENT CORPORATION,
a Texas corporation
By:
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Name:
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Title:
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