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EXHIBIT 10.3
PURCHASE AGREEMENT
PURCHASE AGREEMENT dated and effective as of the 1st day of April, 2000
(this "Agreement"), between Horseshoe Gaming Holding Corp., a Delaware
corporation ("Horseshoe"), and G.A. Xxxxxxxx III ("Seller").
RECITALS:
A. Horseshoe is a casino owner/operator with its principal office in
Joliet, Illinois.
B. Seller is the current owner of a 337.15 shares of Horseshoe (the
"Ownership Interest") and Seller has a capital account having a balance of
$1,062,713.66 (the "Capital Account").
C. In connection with the Acquisition, Seller desires to sell and
Horseshoe believes it is in its best interest to acquire from Seller a portion
of the Ownership Interest equal to 100 shares of Horseshoe and any rights or
claim to a capital account associated with the 100 shares (collectively, the
"Redeemed Ownership").
D. Horseshoe and Seller have agreed that the fair market value of the
Redeemed Ownership plus the payout of that position of Seller's Capital Account
associated with the Redeemed Ownership is FOUR MILLION FOUR HUNDRED AND FORTY
EIGHT THOUSAND AND EIGHT HUNDRED DOLLARS ($4,448,800.00).
NOW, THEREFORE, in consideration of the premises and each act performed
by either party hereto, the parties agree as follows:
1. Subject to the terms and conditions set forth herein, Seller agrees
to sell, transfer, convey, assign and deliver to Horseshoe, and Horseshoe agrees
to purchase, acquire and accept from Seller, the Redeemed Ownership, at the
price of $4,448,800.00 (the "Purchase Price"), payable by a promissory note of
Horseshoe, which is attached hereto (the "Promissory Note") in the amount of
$3,748,800 and $700,000 previously paid to Seller.
2. Seller hereby unconditionally releases and discharges Horseshoe from
any and all claims, known or unknown, directly or indirectly related to or in
any way connected with the Redeemed Ownership and any and all agreements in any
way connected with or related thereto other than this Agreement and the
Promissory Note. Seller acknowledges and agrees that following the consummation
of the transaction contemplated by this Agreement, other than 237.15 shares of
Horseshoe and the Capital Account associated with the 237.15 shares, Seller
shall have no equity ownership or any other interest in Horseshoe or any of its
affiliates or subsidiaries nor will Seller have
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rights of any kind to acquire an ownership interest in Horseshoe or any of its
affiliates or subsidiaries. Seller's Capital Account shall be reduced by
$318,205 representing a proportional reduction to his Capital Account as a
result of the sale of the Redeemed Ownership.
3. Seller acknowledges that on April 14, 2000, Horseshoe made an
additional distribution to Seller as a result of further estimating taxable
income to Seller for 1999. To the extent the estimated total tax distributions
for the 1999 tax year exceeds necessary actual payments, Seller shall return the
excess to Horseshoe. If the estimated payment is insufficient to pay Seller's
taxes on account of Seller's taxable income attributable to his Ownership
Interest, Horseshoe shall distribute an additional amount to Seller to cover
such taxes.
4. Seller represents and warrants that Seller is the lawful record and
beneficial owner of the Redeemed Ownership, free and clear of any liens, claims,
encumbrances, marital property rights, security agreements, equities, options,
charges or restrictions of any kind.
5. This Agreement contains the entire agreement of the parties with
respect to the subject matter hereof and may be amended only by a writing signed
by each party hereto.
6. This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.
7. This Agreement and the rights and obligations of the Company and the
Seller hereunder shall be governed by, and shall be construed and enforced in
accordance with, the internal laws of the State of Illinois, without regard to
conflicts of laws principles.
8. This Agreement may be executed in one or more counterparts, each of
which shall be deemed an original and all of which together shall constitute one
and the same agreement.
9. Horseshoe, on the one hand, and Seller, on the other hand, shall pay
their respective fees and expenses incurred by them in connection with the
transaction contemplated herein.
10. Any term or provision of this Agreement that is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective
to the extent of such invalidity or unenforceability without rendering invalid
or unenforceable the remaining terms and provisions of this Agreement or
affecting the validity or enforceability of any of the terms and provisions of
this Agreement in any other jurisdiction.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
HORSESHOE GAMING HOLDING CORP.
By: /s/ Xxxx Xxxxxx
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Xxxx Xxxxxx, Chief Financial Officer
Seller:
By: /s/ G.A. Xxxxxxxx, III
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G.A. Xxxxxxxx III
