STOCK PURCHASE AGREEMENT
Exhibit 99.1
THIS
STOCK PURCHASE AGREEMENT (the “Agreement”) is made
and entered into as of this 31st day of March, 2008, by and between Empire
Resorts, Inc., a Delaware corporation (the “Company”), and each
of the purchasers named on Exhibit A hereto (each a “Purchaser” and
collectively, the “Purchasers”).
WITNESSETH:
WHEREAS,
the Company desires to issue and sell, and the Purchasers desire to purchase,
all upon the terms and subject to the conditions set forth in this Agreement,
shares of the Company’s common stock, $.01 par value per share (the “Common
Stock”).
NOW,
THEREFORE, in consideration of the premises and of the mutual covenants and
agreements of the parties herein contained, the parties hereby agree as
follows:
1. Purchase and Sale of the
Shares. The Company hereby agrees to issue and sell to each of the
Purchasers, and each of the Purchasers hereby agrees to purchase, the number of
Shares of Common Stock set forth opposite such Purchaser’s name on Exhibit A
hereto (the “Shares”) for the
aggregate purchase price set forth opposite such Purchaser’s name on Exhibit A
hereto (the “Purchase
Price”), which Purchase Price shall equal a per share price of $1.233 per
share. The purchase and sale of the Shares shall take place at 10:00
a.m. on a date to be specified by the parties, which shall be not later than the
third business day after the satisfaction of the conditions set forth in Section 6 hereof, but
no earlier than the thirtieth (30th) day
from the date of this Agreement, at the offices of Xxxxxx Xxxxxxxx Frome
Xxxxxxxxxx & Xxxxxxx LLP, Park Avenue Tower, 00 Xxxx 00xx Xxxxxx,
Xxx Xxxx, Xxx Xxxx 00000, or at such other time and place as the Purchasers and
the Company may mutually agree (the “Closing”). At the
Closing, the Company shall deliver to each Purchaser a certificate or
certificates, registered in such Purchaser’s name as set forth on Exhibit A,
representing the number of Shares designated on Exhibit A to be purchased by
such Purchaser, against payment of the Purchase Price therefor. The
Purchase Price for the Shares shall be payable by check or by wire transfer of
immediately available funds to an account designated by the
Company.
2. Representations and
Warranties of the Company. The Company represents and warrants
to the Purchasers as follows:
2.1 Corporate
Organization. The Company is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
and has all requisite corporate power and authority to own, operate and lease
its properties and to carry on its business as and in the places where such
properties are now owned, operated and leased or such business is now being
conducted.
2.2 Authorization. The
Company has the necessary corporate power and authority to enter into this
Agreement and to assume and perform its obligations hereunder. The execution and
delivery of this Agreement and the performance by the Company of its obligations
hereunder have been duly authorized by the Board of Directors of the Company.
This Agreement has been duly executed and delivered by the Company and
constitutes a legal, valid and binding obligation of the Company enforceable
against it in accordance with its terms, subject to (a) applicable bankruptcy,
insolvency, reorganization and moratorium laws, (b) other laws of general
application affecting the enforcement of creditors’ rights generally and general
principles of equity, (c) the discretion of the court before which any
proceeding therefor may be brought, and (d) as rights to indemnity may be
limited by federal or state securities laws or by public policy.
2.3 SEC Reports and Financial
Statements. The Company has made all filings (the “SEC Reports”)
required of it under the Securities Act of 1933, as amended (the “Securities Act”), and
the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), along
with all the rules and regulations promulgated thereunder. The SEC Reports, when
filed, complied in all material respects with all applicable requirements of the
Securities Act and Exchange Act, and none of the SEC Reports, at the time of
filing, contained an untrue statement of a material fact or omitted to state a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading in light of the circumstances under which they
were made.
2.4 Shares Duly
Issued. The Shares to be issued to the Purchasers in
accordance with the terms hereof shall be, when issued, duly and validly issued,
fully paid and nonassessable.
3. Representations and
Warranties of the Purchasers. Each Purchaser, as to itself,
himself or herself only, represents and warrants to the Company as
follows:
3.1 Organization and
Existence. To the extent indicated on the signature pages
hereto, such Purchaser is either (a) a limited partnership duly organized and
validly existing under the laws of its respective state of formation, (b) a
limited liability company duly organized and validly existing under the laws of
its respective state of formation, (c) a corporation duly organized and validly
existing under the laws of its respective state of incorporation or (d) an
individual. Each Purchaser represents that it was not organized for
the purpose of making an investment in the Company.
3.2 Authorization. The
execution, delivery and performance of this Agreement by such Purchaser and the
consummation by such Purchaser of the transactions contemplated hereby and
thereby are within the powers of such Purchaser and have been duly authorized by
all necessary individual, corporate, partnership or limited liability company
action, as appropriate, on the part of such Purchaser. This Agreement
has been duly executed and delivered by such Purchaser and constitutes a legal,
valid and binding obligation of the Purchaser enforceable against such Purchaser
in accordance with its terms, subject to (a) applicable bankruptcy, insolvency,
reorganization and moratorium laws, (b) other laws of general
application affecting the enforcement of creditors’ rights generally and general
principles of equity, (c) the discretion of the court before which any
proceeding therefor may be brought, and (d) as rights to indemnity may be
limited by federal or state securities laws or by public policy.
3.3 Approvals and
Consents. No action, approval, consent or authorization,
including, but not limited to, any action, approval, consent or authorization by
any governmental or quasi-governmental agency, commission, board, bureau, or
instrumentality is necessary or required as to such Purchaser in order to
constitute this Agreement as a valid, binding and enforceable obligation of such
Purchaser in accordance with its terms.
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3.4 Investment. Such
Purchaser is acquiring the Shares being purchased by it for its own account as
principal, not as a nominee or agent, for investment purposes only, and not with
a view to, or for, resale, distribution or fractionalization thereof in whole or
in part and no other person or entity has a direct or indirect beneficial
interest in such Shares. Such Purchaser does not have any contract,
undertaking, agreement or arrangement with any person or entity to sell,
transfer or grant participations to such person or entity or to any third person
or entity with respect to any of such Shares.
3.5 Exemption From
Registration. Subject to Section 5.2(b) of this Agreement,
Purchaser acknowledges that the offering and sale of the Shares (the “Offering”) is
intended to be exempt from registration under the Securities Act by virtue of
Section 4(2) of the Securities Act and the provisions of Regulation D
promulgated thereunder (“Regulation
D”). In furtherance thereof, such Purchaser represents and
warrants to the Company as follows:
(i) Such
Purchaser realizes that the basis for the exemption from registration under the
Securities Act may not be present if, notwithstanding any representation and/or
warranty to the contrary contained in this Agreement, such Purchaser has in mind
merely acquiring the Shares for a fixed or determinable period of
time;
(ii) Such
Purchaser has the financial ability to bear the economic risk of its investment
in the Shares, has adequate means for providing for its current needs and
contingencies and has no need for liquidity with respect to its investment in
the Company; and
(iii) Such
Purchaser has such knowledge and experience in financial, and business matters
as to be capable of evaluating the merits and risks of an investment in the
Shares.
3.6 Accredited
Investor. Such Purchaser is an “accredited investor,” as that
term is defined in Rule 501 of Regulation D.
3.7 Available
Information. Such Purchaser:
(i) Has
been furnished with any and all documents that may have been made available by
the Company upon request of the Purchaser for a reasonable time prior to the
date hereof including, but not limited to, the Company’s most recent SEC
Reports;
(ii) Has
been provided an opportunity for a reasonable time prior to the date hereof to
obtain additional information concerning the Offering, the Company and all other
information to the extent the Company possesses such information or can acquire
it without unreasonable effort or expense;
(iii) Has
been given the opportunity for a reasonable time prior to the date hereof to ask
questions of, and receive answers from, the Company or its representatives
concerning the terms and conditions of the Offering and other matters pertaining
to an investment in the Shares, or that which was otherwise provided in order
for them to evaluate the merits and risks of a purchase of the Shares to the
extent the Company possesses such information or can acquire it without
unreasonable effort or expense;
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(iv) Has
not been furnished with any oral representation or oral information in
connection with the Offering; and
(v) Has
determined that the Shares are a suitable investment for such Purchaser and that
at this time such Purchaser could bear a complete loss of its investment in the
Shares.
3.8 Purchaser
Representative. Such Purchaser is not relying on any
statements or representations made by the Company or its affiliates or any
purchaser representative with respect to economic considerations involved in an
investment in the Shares.
3.9 Transfer
Restrictions. Subject to Section 5.2(b) of this
Agreement, Purchaser shall not sell or otherwise transfer any of the
Shares without registration under the Securities Act or an exemption therefrom,
and such Purchaser fully understands and agrees that such Purchaser must bear
the economic risk of such Purchaser’s purchase because, among other reasons, the
Shares have not been registered under the Securities Act or under the securities
laws of any state and, therefore, cannot be resold, pledged, assigned or
otherwise disposed of unless they are subsequently registered under the
Securities Act and under the applicable securities laws of such states, or
unless exemptions from such registration requirements are available. In
particular, such Purchaser is aware that the Shares are “restricted securities,”
as such term is defined in Rule 144 promulgated under the Securities Act. Such
Purchaser further understands that sale or transfer of the Shares are further
restricted by state securities laws and the provisions of this
Agreement.
3.10 Entire
Agreement. No representation or warranty has been made to such
Purchaser by the Company, or any officer, director, employee, agent, affiliate
or subsidiary of the Company other than those contained herein and in
subscribing for the Shares such Purchaser is not relying upon any
representations other than those contained herein.
3.11 Purchaser
Information. Any information that such Purchaser has
previously furnished, or is now furnishing to the Company with respect to such
Purchaser’s financial position and business experience is correct and complete
as of the date of this Agreement and, if there should be any material change in
such information, such Purchaser will immediately furnish revised or corrected
information to the Company.
3.12 Legends. Such
Purchaser understands and acknowledges that that each certificate representing
the Shares will be endorsed with substantially the following
legends:
(i) “THE
SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED (THE "ACT"), OR ANY STATE SECURITIES LAWS. THEY MAY NOT BE SOLD
OR OFFERED FOR SALE IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT AS TO
THE APPLICABLE SECURITIES UNDER THE ACT AND ANY STATE SECURITIES LAWS OR
PURSUANT TO AN EXEMPTION FROM REGISTRATION.”; and
(ii) any
other legends required by applicable state or federal securities laws or any
applicable state laws (including applicable state gaming laws) regulating the
Company's business.
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3.13 Purchaser
Address. The address set forth on Exhibit A is such
Purchaser’s true and correct business, residence or domicile
address.
3.14 Non-Marketable
Investments. Such Purchaser’s overall commitment to
investments that are not readily marketable is not disproportionate to such
Purchaser’s net worth, and an investment in the Shares will not cause such
overall commitment to become excessive.
3.15 Finders. Such
Purchaser has not retained any finder, broker, agent, financial advisor or other
intermediary in connection with the transactions contemplated by this Agreement
and agrees to indemnify and hold harmless the Company, its officers, directors,
affiliates, subsidiaries, employees and agents from liability for any
compensation to any such intermediary retained by such Purchaser and the fees
and expenses of defending against such liability or alleged
liability.
3.16 Survival. The
foregoing representations, warranties and agreements shall survive the execution
of this Agreement.
4. Covenants of the
Purchasers
4.1 Lock
Up. Each of the Purchasers agrees that, during the period
commencing on the Closing Date and ending on the earlier to occur of (i) six
months after the Closing Date, (ii) the termination of that certain Agreement to
Form Limited Liability Company and Contribution Agreement, among Concord
Associates, L.P. and Empire Resorts, Inc., dated as of February 8, 2008 (the
“Contribution Agreement”), (iii) the occurrence of an Empire Change of Control
(as such term is defined in the Contribution Agreement) or (iv) the occurrence,
other than by an affiliate of any Purchaser or any person or entity acting in
concert with any Purchaser, of any exchange offer, liquidation, tender offer,
consolidation, merger, binding share exchange, combination, reclassification or
recapitalization with respect to all or substantially all of the shares of
Common Stock of the Company (the “Lock Up Period”), it
will not (i) offer, sell, offer to sell, contract to sell, hedge, pledge, sell
any option or contract to purchase, purchase any option or contract to sell,
grant any option, right or warrant to purchase or sell (or announce any offer,
sale, offer of sale, contract of sale, hedge, pledge, sale of any option or
contract to purchase, purchase of any option or contract of sale, grant of any
option, right or warrant to purchase or other sale or disposition), or otherwise
transfer or dispose of (or enter into any transaction or device which is
designed to, or could be expected to, result in the disposition by any person at
any time in the future), the Shares during the Lock Up Period or (ii) enter into
any swap or other agreement or any transaction that transfers, in whole or in
part, directly or indirectly, the economic consequence of ownership of the
Shares, whether any such swap or transaction described in clause (i) or (ii)
above is to be settled by delivery of the Shares, in cash or otherwise;
provided, however, nothing in this Agreement shall preclude any Purchaser from
pledging the Shares to secure an obligation of such Purchaser.
5. Covenants and Agreements of
the Company.
5.1 Listing of the Shares and
Related Matters. Promptly following the date hereof, the
Company shall take all necessary action to cause the Shares to be listed on the
Nasdaq Global Market as promptly as practicable after the Closing
Date. Further, if the Company applies to have its Common Stock or
other securities traded on any other principal stock exchange or market, it
shall include in such application the Shares and will take such other action as
is necessary to cause such Common Stock to be so listed. The Company
will use commercially reasonable efforts to continue the listing and trading of
its Common Stock on the Nasdaq Global Market and, in accordance, therewith, will
use commercially reasonable efforts to comply in all respects with the Company’s
reporting, filing and other obligations under the bylaws or rules of such market
or exchange, as applicable.
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5.2 Registration
Statement.
(a) Company
shall promptly prepare, and shall file as promptly as practicable, but in any
event no later than the sixtieth (60th) day
following the Closing, a registration statement with respect to the Shares to be
purchased by Purchaser pursuant to this Agreement (together with all amendments
thereto, the “Registration
Statement”). The Company will cause the Registration Statement to comply
as to form in all material respects with the applicable provisions of the
Exchange Act and the rules and regulations thereunder. The Company
shall use all best efforts to qualify such Shares under any applicable state
securities laws. The Company shall use all best efforts to cause the
Registration Statement to become effective as soon as practicable, and to obtain
all consents or waivers of other parties that are required therefor as soon as
practicable. The all costs and expenses incurred in connection with
the Registration Statement shall be for the account of and shall be paid by the
Company.
(b) Purchaser
shall provide all information reasonably requested by the Company for inclusion
in any Registration Statement to be filed hereunder. No filing of, or
amendment or supplement to, the Registration Statement shall be made by the
Company without providing Purchaser a reasonable opportunity to review and
comment thereon and provide its consent thereto, such consent not to be
unreasonably withheld. The Company will advise Purchaser promptly
after the Company receives notice thereof, of the time when the Registration
Statement has become effective or any supplement or amendment has been filed, of
the issuance of any stop order, the suspension of the qualification of the
Common Stock for offering or sale in any jurisdiction, or any request by the
U.S. Securities and Exchange Commission (the “SEC”) for amendment
of the Registration Statement or comments thereon and responses thereto or
requests by the SEC for additional information.
(c) In
connection with any offering, sale and delivery of the Company’s Common Stock
pursuant to a registration statement effected pursuant to this Section 5.2, the
Company and Purchaser shall provide each other and any applicable underwriter
with customary representations, warranties and covenants, including covenants of
indemnification and contribution.
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6. Conditions to
Closing. The respective obligations of the parties to
consummate the purchase of the Shares are subject to:
(a)
either (i) the receipt by the Company of an interpretive letter from The NASDAQ
Stock Market, LLC that the sale of the Shares by the Company does not require
the approval of the stockholders of the Company or (ii) stockholder
approval of the sale of the Shares to the Purchasers pursuant to this
Agreement;
(b) the
representations and warranties of the Company and Purchaser contained in this
Agreement shall be true and correct as of the Closing as though made on and as
of the Closing;
(c) each
of the Company and Purchaser shall have performed all of its respective
obligations and covenants under this Agreement; and
(d) no
decision, order or similar ruling shall have been issued (and remain in effect)
restraining or enjoining the transactions contemplated by this
Agreement.
7. General
Provisions.
7.1 Entire Agreement; Amendment
and Waiver. This Agreement constitutes the entire agreement
between the parties hereto with respect to the subject matter contained herein
and supersedes all prior oral or written agreements, if any, between the parties
hereto with respect to such subject matter and, except as otherwise expressly
provided herein, is not intended to confer upon any other person any rights or
remedies hereunder. Any amendments hereto or modifications hereof
must be made in writing and executed by each of the parties
hereto. Any failure by the Company or the Purchasers to enforce any
rights hereunder shall not be deemed a waiver of such rights.
7.2 Notices. Unless
otherwise provided, any notice required or permitted under this Agreement shall
be given in writing and shall be sent to the respective party at the addresses
set forth below, postage prepaid, by certified mail, return receipt requested,
by a nationally recognized overnight courier service that provides tracing and
proof of receipt of items mailed or by facsimile provided that if notices are
given by facsimile a copy thereof must be sent on the same day by nationally
recognized overnight courier service that provides tracing and proof of receipt
of items mailed for next business day delivery. Notices shall be
effective upon the date of receipt or refusal of receipt. A party may
change its address to which notices to it shall be sent by a notice sent in
accordance with the requirements of this Section.
(i) If
to the Company, to it at:
Empire
Resorts, Inc.
x/x
Xxxxxxxxxx Xxxxxxx
Xxxxx
00X
Xxxxxxxxxx,
Xxx Xxxx 00000
Attention:
Xxxxx Xxxxxx
Fax
No.: 000-000-0000
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with a
copy to:
Xxxxxx
Xxxxxxxx Frome Xxxxxxxxxx & Xxxxxxx LLP
Park
Avenue Tower
00 Xxxx
00xx
Xxxxxx
Xxx Xxxx,
XX 00000
Attention:
Xxxxxx X. Xxxxxxxx, Esq.
Fax
No.: (000) 000-0000
(ii) If
to any of the Purchasers, to such Purchaser at the address for such Purchaser
set forth on Exhibit A hereto, with a copy to:
XxxXxxxx
Xxxxxxxxx Xxxxxxxxxx
Xxxx
& Xxxxxxxxxx, LLP
Xxx Xxxxx
Xxxxxxxxx Xxxxxx
Xxxxx
Xxxxxx, Xxx Xxxx 00000
Attn: Xxxxxx
X. Xxxxxxxxx, Esq.
Fax
No.: 000-000-0000
7.3 Governing
Law. This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware without giving effect to
conflict of laws principles.
7.4 Binding Effect;
Assignment. This Agreement and the various rights and
obligations arising hereunder shall inure to the benefit of and be binding upon
the Company and the Purchasers and each of their respective successors and
assigns. Neither this Agreement nor any of the rights, interests or
obligations hereunder shall be transferred or assigned (by operation of law or
otherwise) by any of the parties hereto without the prior written consent of the
other parties hereto; provided, Purchaser shall be permitted to transfer or
assign any of its rights, interests or obligations hereunder to any Member or
affiliate of Purchaser, to Concord Associates, L.P., or to any Member or
affiliate of Concord Associates, L.P. (collectively, the “Permitted Transferees”
and, individually, a “Permitted Transferee”) without the prior written consent
of the Company; provided, that any such Permitted Transferee shall have provided
its prior written consent to be bound by the terms and conditions of this
Agreement as a Purchaser hereunder. Any transfer or assignment of any
of the rights, interests or obligations hereunder in violation of the terms
hereof shall be void and of no force or effect.
7.5 Expenses. All
costs and expenses incurred in connection with this Agreement and the
transactions contemplated hereby shall be paid by the party incurring such costs
and expenses.
7.6 Headings. The
headings or captions contained in this Agreement are for reference purposes only
and shall not affect in any way the meaning or interpretation of this
Agreement.
7.7 Pronouns. Whenever
the pronouns “it” or “its” are used herein, they shall also be deemed to mean
“he” or “his” or “she” or “hers” whenever applicable. Words in the
singular shall be read and construed as though in the plural and words in the
plural shall be read and construed as though in the singular in all cases where
they would so apply.
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7.8 Severability. If
any term or other provision of this Agreement is invalid, illegal or incapable
of being enforced by virtue of any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner adverse to any
party. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that the transactions contemplated hereby are fulfilled to the maximum extent
possible.
7.9 Information
Confidential. Each Purchaser acknowledges that the information received
by it pursuant hereto may be confidential and is for its use
only. Each Purchaser agrees that it will not use such information in
violation of the Exchange Act, or reproduce, disclose or disseminate such
information to any other person, unless the Company has made such information
available to the public generally.
7.10 Counterparts. This
Agreement may be executed in one or more counterparts, each of which shall be
deemed an original, but all of which taken together shall constitute one and the
same instrument.
[Signature
Page Follows]
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[SIGNATURE
PAGE TO STOCK PURCHASE AGREEMENT]
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed as of the
day and year first above written.
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EMPIRE
RESORTS, INC.
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|
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By:
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/s/
Xxxxx X. Xxxxxx
|
|
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Name:
Xxxxx
X. Xxxxxx
|
|
|
Title:
Chief
Executive Officer
|
|
PURCHASER
|
|
|
LRC
ACQUISITION LLC
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|
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By:
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/s/
Xxxxx X. Xxxxxxxx
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|
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Name:
Xxxxx
X. Xxxxxxxx
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Title:
Managing
Member
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Exhibit
A
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Name and
Address of Purchaser
|
Shares
Purchased
|
Purchase
Price
|
|
LRC
Acquisition LLC
c/o
Cappelli Enterprises, Inc.
000
Xxxxxxx Xxxxxx
Xxxxxxxx,
Xxx Xxxx 00000
Attention:
Xxxxx X. Xxxxxxxx
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4,200,000
|
$5,178,600
|
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