EXHIBIT 10.68
EXCHANGE AGREEMENT
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Among
PIONEER LLC,
a Nevada limited liability company
as Transferor
PIONEER HOTEL INC.,
a Nevada corporation
as Tenant
HAHF PIONEER, LLC,
a Delaware limited liability company,
as Transferee
and
▇▇▇▇▇▇ AFFORDABLE HOUSING OF FLORIDA, INC.,
a Florida corporation
December 29, 2000
Pioneer Hotel and Casino
Laughlin, Nevada
EXCHANGE AGREEMENT
THIS EXCHANGE AGREEMENT ("Agreement") is made and entered into as of
December 29, 2000 among PIONEER LLC, a Nevada limited liability company
("Transferor"), PIONEER HOTEL INC., a Nevada corporation ("Tenant"), HAHF
PIONEER, LLC, a Delaware limited liability company ("Transferee") and ▇▇▇▇▇▇
AFFORDABLE HOUSING OF FLORIDA, INC., a Florida corporation ("HAHF").
R E C I T A L S
A. Transferor desires to transfer and convey to Transferee its fee
simple interest and its leasehold interest under the Ground Lease (defined
below) relating to that certain hotel and casino in Laughlin, Nevada, together
with the intangible and personal property used in connection therewith pursuant
to a transfer governed by Section 351 of the Internal Revenue Code of 1986, as
amended (the "Code").
B. Transferee is willing to acquire and/or ground lease the
building, land and such other property identified in this Agreement.
C. The parties intend that the transfer pursuant to this Agreement
be a part of a common plan for the capitalization of HAHF, together with a
contribution of property to HAHF by ▇▇▇▇▇▇ Financial, Inc. in exchange for
common and preferred stock of HAHF, pursuant to Section 351 of the Code.
NOW, THEREFORE, FOR VALUABLE CONSIDERATION, the receipt and adequacy
of which are hereby acknowledged, Transferor, Tenant, Transferee and HAHF agree
as follows:
ARTICLE I
Transfer
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1.1 Transfer. Transferor hereby agrees to transfer and convey to
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Transferee, and Transferee hereby agrees to acquire from Transferor, subject to
the terms and conditions set forth herein, the property described in Sections
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1.1(a) through 1.1(d) below, constituting all of the property and rights in the
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enterprise known as the Pioneer Hotel and Casino in Laughlin, Nevada other than
the regulated gaming equipment used in connection with the casino (the "Gaming
Equipment") which Gaming Equipment is not included in the transfer contemplated
by this Agreement and is being transferred by Tenant to PDS Gaming Corporation-
Nevada and thereafter leased back to Tenant subject to the terms of a lease
between such parties (the "Gaming Lease").
(a) Land. The parcel(s) of real property more particularly described
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in Exhibit A-1 (the "Owned Land"), which, subject to the terms and conditions
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hereof,
shall be conveyed to Transferee at the Closing (defined below) described below
by a deed in the form of Exhibit B (the "Deed") and the parcel(s) of real
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property more particularly described in Exhibit A-2 (the "Ground Leased Land";
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together with the Owned Land, the "Land"), which, subject to the terms and
conditions hereof, shall be conveyed to Transferee at the Closing by an
assignment in the form of Exhibit C (the "Assignment of Ground Lease");
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(b) Improvements. All improvements located on the Land, including,
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without limitation, the hotel, casino and all other buildings, structures,
apparatus, fixtures, equipment and appliances owned by Transferor which are
permanently affixed to the Land (all of which are collectively referred to as
the "Improvements"); and
(c) Intangible Property. All of the interest of Transferor in any
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intangible personal property owned by Transferor now or on the Closing Date
(defined below) which relates to and is reasonably required for the ownership of
the Land or occupation of the Improvements and is transferable (as opposed to
nontransferable intangible personal property such as gaming licenses and liquor
licenses, which are specifically excluded), including, without limitation,
Intellectual Property (as defined herein) building plans and specifications,
certain licenses and entitlements (e.g., certificates of occupancy), soil
reports, claims and causes of action related to the Land or Improvements,
surveys, maps, any and all warranties, guarantees, utility contracts, permits,
names, logos, designs, customer lists or similar assets, contract rights
(including those applicable to Regulated Property), covenants not to compete,
patents, patent rights, patent applications, copyrights, copyright
registrations, trade secrets, rights of priority, know how, trademarks, service
marks, trademark and service ▇▇▇▇ registrations and registered domain names,
together with the right to secure reissuances and extensions thereof, goodwill
and all licenses, agreements and royalty arrangements which are currently in
effect granted by Transferor to any Person or by any Person to Transferor for
the use of any Intangible Property related to Transferor's ownership and use of
the Property and other rights owned by Transferor, relating to the ownership or
occupation of all or any part of the Property ("Intangible Property"), all of
which shall be transferred to Transferee at the Closing by an instrument in the
form of Exhibit M (the "Assignment of Intangible Property); and
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(d) Personal Property. All of Transferor's interest in and to all
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tangible personal property upon the Land or used in connection with the
Improvements, including, without limitation, appliances, fixtures, furniture,
furnishings, tools, machines, apparatus, equipment, supplies, decorations, any
owned or leased vehicles, inventory, computers and software and other items of
personal property (the "Personal Property"), but specifically excluding (i) the
Gaming Equipment and (ii) all personal property owned by hotel guests, all of
which Personal Property shall be transferred to Transferee at the Closing by an
instrument in the form of Exhibit N (the "▇▇▇▇ of Sale").
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1.2 Certain Definitions.
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(a) The Land, the Improvements, the Intangible Property and the
Personal Property are collectively referred to herein as the "Property". The
Land and the Improvements are collectively referred to herein as the "Real
Property".
(b) The "Ground Lease" means that certain Lease dated October 31,
1978 among Palmall Properties, Inc., The ▇▇▇▇▇ & ▇▇▇▇▇▇ ▇▇▇▇▇▇ Trust and The
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ Trust, as tenants-in-common (as successors-in-interest to ▇▇▇▇▇
▇. ▇▇▇▇▇▇▇▇, deceased, and ▇.▇. ▇▇▇▇▇▇▇▇ AKA ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, deceased), as
lessor, and Tenant (as successor-in-interest to Colorado River Motel and Casino,
Inc. and Colorado River Resort Hotel, Inc. and ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇), as lessee, a
memorandum of which was recorded in the Official Records of ▇▇▇▇▇ County, Nevada
on March 11, 1982 in Book 1533 as Document No. 1492994, together with all
assignments and amendments to date.
1.3 Leaseback. Concurrently with consummation of the Closing,
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Transferee (as landlord) agrees to lease the Property to Tenant (as tenant), and
Tenant agrees to lease the Property from Transferee, pursuant to a lease in the
form and substance of Exhibit D (the "Net Lease").
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1.4 Guaranty of Lease; Cash Collateral Account; Lone Mountain.
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Concurrently with the consummation of the Closing, Transferor will cause (a)
Santa Fe Gaming Corporation ("SFGC"), Santa Fe Hotel Inc. ("SFHI") and Tenant
(individually and collectively "Guarantor") to unconditionally and jointly and
severally guarantee to Transferee, among other things, the performance by
Tenant, as tenant, of all of its obligations under the Net Lease (except that
Tenant shall not guarantee its own obligations), pursuant to a guaranty in the
form and substance of Exhibit E (the "Guaranty"), (b) SFHI to deliver to the
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Title Company (to be held in escrow until each Account defined below is
established) an amount equal to $15,000,000 (the "Escrow Holdback Amount") and,
within 30 days following Closing, to establish two cash collateral accounts with
a banking institution located in the State of California (each, an "Account")
and pledge each such Account to Transferee to secure the performance by Tenant,
as tenant, of all of its obligations under the Net Lease, pursuant to control
and pledge agreements in the form and substance of Exhibit F (collectively, the
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"Cash Collateral Agreement"), and (c) SFHI to execute and deliver to Transferee
for recording a deed of trust (the "LM Deed of Trust") encumbering that certain
parcel of land in ▇▇▇▇▇ County, Nevada legally described on Exhibit A-3 (the
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"Lone Mountain Property") to partially secure Guarantors' obligations under the
Guaranty.
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ARTICLE II
Exchange Price/Exchange Consideration
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2.1 Exchange Price/Exchange Consideration. The exchange price for
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the Property (the "Exchange Price") shall be $33,500,000. The Exchange Price
shall be allocated and payable as follows: (a) the assumption by Transferee of
$32,500,000 (the "Assumed Indebtedness") of the total $34,400,000 indebtedness
(the "Intercompany Indebtedness") payable to SFHI ("Intercompany Lender"), which
Intercompany Indebtedness shall, after such assumption, equal $1,900,000 (the
"Remaining Intercompany Indebtedness"), and which Assumed Indebtedness shall be
subsequently repaid by Transferee; and (b) the assignment by Transferee to
Transferor of 1,000 shares of Series A, non-voting, non-convertible cumulative
preferred stock of HAHF with a $1,000 par and liquidation preference value (the
"Preferred Stock"). The Preferred Stock shall have the rights, privileges,
preferences, qualifications and limitations set forth in HAHF's Articles of
Incorporation, a copy of which is attached as Exhibit L. Upon Transferee's
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acquisition of the Property at the Closing, Transferee shall assume and repay
the Assumed Indebtedness, and shall assign and deliver the Preferred Stock to
Transferor. Transferor, Tenant and Transferee acknowledge that the transfer of
the Property will be treated as a transfer governed by Section 351 of the Code,
and will so report the transfer for income tax purposes.
ARTICLE III
Title To Real Property and Due Diligence
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3.1 Title.
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(a) Transferor shall deliver to Transferee a commitment from ▇▇▇▇▇▇▇
Title Insurance Company (the "Title Company") to issue a 1999 ALTA Owner's (and
Leasehold, as applicable) Policy of Title Insurance with respect to the Property
in the full amount of the Exchange Price (as allocated by Transferee between the
Owned Land and the Ground Leased Land) (the "Title Commitment"), accompanied by
legible copies of all exceptions to title contained therein.
(b) Prior to Closing, Transferor shall deliver to Transferee an "as-
built" survey (the "Survey") of the Property prepared by a licensed surveyor or
civil engineer reasonably acceptable to Transferee. The Survey shall be
acceptable in form to Transferee and shall conform to the "Minimum Standard
Detail Requirements for ALTA/ACSM Land Title Surveys" for urban properties
jointly adopted in 1999 including items 1-4, 6-11 and 13-16 of Table A thereof.
The Survey shall be certified to Transferee, the Title Company and such other
persons as Transferee may reasonably require in the form set forth in Exhibit G.
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(c) At its expense, Transferor shall remove as liens on the Real
Property at or prior to the Closing: (i) all delinquent taxes, bonds and
assessments together with interest and penalties thereon; (ii) all other
monetary liens, including, without limitation, (A) the Intercompany Indebtedness
and (B) all monetary liens shown on the Title Commitment (including judgment and
mechanics liens, whether or not liquidated, and mortgages and deeds of trust,
with Transferor being fully responsible for any fees or penalties incurred in
connection therewith); and (iii) any matter which would constitute a breach by
Transferor of its representations in Article VII. If Transferor fails to remove
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the foregoing items at or prior to the time required above, Transferee may elect
to close the acquisition of the Property, cure or remove the non-approved
matters which have not been removed and, if they are matters required to be
removed by Transferor, credit the reasonable costs of such cure or removal
against the Exchange Price payable by Transferee.
(d) On or before the day which is three (3) business days from the
date Transferor delivers to Transferee both the Title Commitment and the Survey,
(i) Transferee shall deliver notice to Transferor with a list of anything
disapproved by Transferee on the Survey and a list of any exceptions to title
shown on the Title Commitment required to be removed by Transferor, other than
easements and minor exceptions which do not materially interfere with the
operation of the Property and excluding any exceptions covered under paragraph
(c) above. Transferor shall convey title to the Property to Transferee at the
Closing subject to no exceptions other than the following ("Permitted
Exceptions"): (i) those exceptions or matters set forth in the Title Commitment
and Survey not disapproved by Transferee in the manner provided above or (ii)
the documents called for by this Agreement to be recorded at the Closing. If
Transferee disapproves of any matters in the Title Commitment (or the exceptions
thereto) or Survey in writing within such time period, Transferor shall exercise
its reasonable, good faith efforts to remedy to Transferee's satisfaction any
matter so disapproved by Transferee as promptly as possible; provided, however,
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in no event shall Transferor be required to spend in excess of $50,000 to remedy
such matter except for monetary liens or judgments. Transferee shall take title
to the Property at the Closing if Transferor shall cure, on or before the
Closing, any such title or Survey defects identified by Transferee in writing.
If Transferor shall, despite the exercise of its reasonable, good faith efforts,
not cure, on or before the Closing, any such title or Survey defects, this
Agreement may be terminated upon written notice from Transferee.
(e) On or before the Closing Date, Transferor shall cause the Title
Company to deliver to Transferee a binding commitment, in form acceptable to
Transferee, to issue at the Closing a 1999 ALTA Owner's (or Leasehold, as
applicable) Policy of Title Insurance with liability in the amount of
$32,500,000, insuring Transferee's interest in the Real Property and all
easements benefiting the Real Property, subject to the Permitted Exceptions,
together with endorsements reasonably requested by Transferee, including,
without limitation, survey, access and contiguity.
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(f) On or before the Closing Date, Transferor shall cause the Title
Company to deliver to Transferee a binding commitment, in form acceptable to
Transferee, to issue at Closing a 1999 ALTA Lender's Policy of Title Insurance
with liability in the amount of $5,000,000, insuring Transferee's security
interest in the Lone Mountain Property, subject to no monetary liens or any
other exceptions not reasonably approved by Transferee prior to Closing (the
"Lone Mountain Title Policy").
(g) On or before the Closing Date, Transferor shall cause the Title
Company to deliver to Tenant and Transferee, as applicable, a binding
commitment, in form acceptable to Tenant and Transferee, to issue at Closing a
1999 ALTA Leasehold Policy of Title Insurance with liability in an agreed
amount, insuring such parties' respective leasehold interests in the property
leased pursuant to the Net Lease.
3.2 Due Diligence Items. Prior to the Closing, Transferor or Tenant
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shall deliver to Transferee each of the following items (the "Due Diligence
Materials"):
(i) a true and correct copy of the Ground Lease and any and all
existing leases, licenses or other occupancy agreements affecting the Real
Property (collectively, "Third Party Leases"), as set forth in Exhibit H; any
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agreements affecting the Loan Mountain Property;
(ii) a list of service contracts, hotel management contracts,
casino management contracts, franchise agreements, reservations contracts,
warranties, permits, soil reports and other contracts or documents of any nature
relating to the Property or any portion thereof, as disclosed on Exhibit I (the
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"Service Contracts");
(iii) the certificates of occupancy for the Property and, to the
extent they are in Transferor's or Tenant's possession or control, all other
governmental permits, licenses, entitlements and approvals with respect to the
Property obtained or held by Transferor or Tenant and relating to the
construction, ownership or occupancy of the Property or any portion thereof,
including, without limitation, all building permits, gaming licenses, liquor
licenses, restaurant permits, pool permits, health code permits and other
similar items;
(iv) to the extent they are in Transferor's or Tenant's
possession, the plans and specifications for the Improvements (the "Plans and
Specifications"); and
(v) Tenant's unaudited and SFGC's audited financial statements
for the fiscal year ended September 30, 1999, and unaudited financial statements
for the fiscal quarter ended September 30, 2000.
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ARTICLE IV
Reserved
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ARTICLE V
Conditions to Closing
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A. Transferee's Conditions to Closing. The obligations of Transferee
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to acquire the Property and lease the same to Tenant are subject to satisfaction
of the following conditions on or before the Closing Date:
5.1 Title. The Title Company issuing the binding commitment called
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for by Sections 3.1(e), (f) and (g).
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5.2 Environmental. Transferee's review and approval of a Phase I
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environmental report confirming to Transferee's satisfaction that the Property
is not affected by hazardous substances or hazardous wastes at levels requiring
reporting or remediation under applicable Laws (as hereinafter defined), other
than those used by Transferor or Tenant in the ordinary course of business and
in compliance with all applicable state, federal and local laws and regulations.
5.3 Legal Compliance. Transferor's demonstration to Transferee that
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the Property and the transfer thereof to Transferee is in substantial compliance
with all laws, statutes, requirements, ordinances and regulations (including,
without limitation, those relating to zoning, land use, building codes, gaming,
the environment, health and safety) relating to the Property (collectively,
"Laws"), including compliance with the Americans with Disabilities Act, 42
U.S.C. (S)12,101 et seq. ("ADA").
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5.4 Financial Condition. Transferee shall have received and found
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satisfactory the audited financial statements delivered pursuant to Section
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3.2(v) and there shall have no subsequent material adverse change in the
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financial condition of Tenant or Guarantor or both.
5.5 Representations and Warranties. All of Transferor's and Tenant's
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representations and warranties contained herein, or made in writing by
Transferor pursuant to this Agreement, shall have been true and correct in all
material respects when made and shall be true and correct in all material
respects as of the Closing Date.
5.6 Non-Foreign Status of Transferor. Transferor's execution and
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delivery to Transferee, at the Closing Date, of Transferor's certificate in the
form attached hereto as Exhibit K (the "Non-Foreign Certificate").
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5.7 Transferor's Opinion of Counsel. Transferor obtaining and
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delivering to Transferee at the Closing a legal opinion from counsel for
Transferor and Guarantor, acceptable to Transferee ("Transferor's Counsel
Opinion") stating that (i) Transferor, Tenant and Guarantor are each duly
formed, validly existing, and in good standing under the laws of the respective
states of their formation; (ii) the persons executing this Agreement, the Net
Lease, the Guaranty, the Cash Collateral Agreement, the Deed, the Assignment of
Ground Lease, the LM Deed of Trust and any of the other documents executed and
delivered on behalf of Transferor, Tenant and/or Guarantor (collectively,
"Transferor's Closing Documents") are duly appointed and authorized by
Transferor, Tenant and Guarantor, respectively, to execute such documents, (iii)
Transferor's Closing Documents have been duly authorized, executed and delivered
by Transferor, Tenant and Guarantor and constitute legal, valid and binding
obligations of Transferor, Tenant and Guarantor, respectively, enforceable
against Transferor, Tenant and Guarantor, respectively, in accordance with their
terms subject to exceptions relating to bankruptcy, insolvency and the
application of equitable principles, (iv) Transferor, Tenant and Guarantor each
have full power and authority to execute, deliver and perform their respective
obligations under Transferor's Closing Documents and to carry on their
respective businesses as presently conducted, (v) to the current, actual
knowledge of Transferor's counsel, the execution, delivery and performance of
Transferor's Closing Documents will not conflict with or result in a breach or
violation of any term or provision of, or constitute a default under (A) the
organizational documents of Transferor, Tenant or Guarantor, (B) any mortgage,
deed of trust, lease, license or other agreement or instrument to which
Transferor, Tenant or Guarantor is a party or by which Transferor, Tenant or
Guarantor is bound, (C) any statute, order, rule or regulation of any
governmental body or agency or instrumentality thereof, or (D) any order, writ,
injunction or decree of any court or any arbitrator having jurisdiction over
Transferor, Tenant, Guarantor, the Property or the Lone Mountain Property, (vi)
Transferee has a perfected security interest in each Account (which opinion in
this clause (vi) may be rendered by Transferor's special tax counsel, ▇▇▇▇▇▇
▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP at the time each Account is established), (vii) Transferee
has received all consents, approvals and authorizations necessary to perform its
obligations under this Agreement, and (viii) such other matters as Transferee
may reasonably require.
5.8 Cash Collateral. SFHI's delivery of the Escrow Holdback Amount.
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5.9 Approval of Appraisal. Transferee's review and approval of an
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MAI appraisal for the Property which qualifies with applicable FIRREA
regulations, prepared by an appraiser acceptable to Transferee. Transferee
agrees that (a) Transferee shall not influence the appraiser in any way during
the appraiser's review of the Property and (b) if such appraisal indicates a
fair market value of the Property of $35,000,000 or higher, this condition shall
be deemed satisfied. Transferor and Tenant agree that neither shall influence
the appraiser in any way during the appraiser's review of the Property.
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5.10 Deliveries by Transferor. Transferor's, Tenant's or Guarantor's
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due and timely execution and delivery of Transferor's Closing Documents and all
of the other documents and items specified in Sections 6.2 and 6.3.
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5.11 UCC Financing Statements. Transferor delivering or causing to be
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delivered to Transferee the results of a "debtor" search of the index of real
estate records of the county in which the Property and the Lone Mountain
Property is located and with the secretary of state's office for Transferor, the
owner of the Lone Mountain Property and Tenant, together with evidence
satisfactory to Transferee that each such financing statement evidencing a
security interest in any component of the Property or the Lone Mountain Property
(excluding any interest relating to the purchase option relating to the Lone
Mountain Property) will be terminated as of the Closing Date.
5.12 Committee Approval. Transferee's internal credit committee shall
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have approved the transactions contemplated hereunder in their sole discretion,
which approval shall be granted or withheld on or before December 28, 1999.
5.13 Ground Lessor Estoppel. Receipt of a consent and estoppel (the
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"Ground Lessor Estoppel") from each of the ground lessors under the Ground Lease
in substantially the form of Exhibit T hereto.
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5.14 Union Contracts. Confirmation that all notification requirements
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under any collective bargaining agreements or any other employee related
contracts have been complied with, that neither Transferor nor Tenant is in
default of any of its obligations under those agreements, and that true and
complete copies of those agreements have been delivered to Transferee and are
listed on Exhibit I. All such employment agreements and collective bargaining
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agreements are in full force and effect and, except as disclosed on Exhibit U,
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there are no pending claims, grievances, arbitrations or any pending litigation
whatsoever arising out of or relating to such collective bargaining agreements
or employment agreements.
The foregoing conditions contained in this Section V.A are intended
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solely for the benefit of Transferee. If any of the foregoing conditions are
not satisfied in a timely manner, upon notice specifying any non-satisfaction
and the expiration of three (3) business days without the same having been
satisfied, this Agreement shall terminate and thereafter the parties shall have
no further obligation to one another except that the indemnities provided for in
Section 9.2 shall survive (the "Surviving Obligations"); provided, however, that
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Transferee shall have the right, in its sole discretion, to waive in writing any
condition not so satisfied, in which case this Agreement shall not be
terminated.
B. Transferor's Conditions to Closing. Transferor's obligation to
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transfer the Property and Tenant's obligation to lease the same back from
Transferee is conditioned upon satisfaction of the following conditions on or
before the Closing Date: Transferee's due and timely execution and delivery of
all documents and items to be executed and/or delivered by Transferee pursuant
to this Agreement including, without
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limitation, (a) the Exchange Price, including the issuance of the Preferred
Stock, (b) the Net Lease, and (c) all of the other documents and items specified
in Sections 6.2 and 6.4 (the Net Lease and such other documents executed and
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delivered on behalf of Transferee, "Transferee's Closing Documents"). The
delivery of the binding commitment called for by Section 3.1(g) shall also be a
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condition precedent to Transferor's obligations under this Agreement; provided,
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however, that Transferor's failure to pay the premium associated therewith shall
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not constitute the failure of this condition.
The foregoing conditions contained in this Section V.B are intended
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solely for the benefit of Transferor. If any of the foregoing conditions are
not satisfied in a timely manner upon notice specifying any non-satisfaction and
the expiration of three (3) business days without the same having been
satisfied, this Agreement shall terminate and thereafter the parties shall have
no further obligation to one another except for the Surviving Obligations;
provided, however, that Transferor shall have the right, in its sole discretion,
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to waive any condition not so satisfied, in which case this Agreement shall not
be terminated.
ARTICLE VI
Closing and Recording
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6.1 Closing and Closing Date. Subject to the provisions of Section
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V.A, the parties shall consummate the transfer and leaseback of the Property as
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contemplated herein at a closing (the "Closing") to be held on December 29, 2000
(the "Closing Date"), either (i) at the offices of Paul, Hastings, ▇▇▇▇▇▇▇▇ &
▇▇▇▇▇▇, LLP, ▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ or (ii) by means of
an escrow closing.
(a) The Closing shall be deemed to have occurred when all conditions
to such Closing have been satisfied (or waived in writing by the party in whose
favor the condition was established).
(b) At the Closing, the parties shall deliver to one another the
documents and other instruments required hereunder to be delivered at such
Closing, although no delivery shall be deemed complete until all of such
documents and other instruments have been delivered and the other conditions to
such Closing have been satisfied (or waived as provided above).
(c) The procedure for satisfying the condition in Sections 3.1(e) and
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(f) ("Title Condition") shall be as follows: when all conditions to the Closing
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have been satisfied other than the Title Condition and the delivery of the
Exchange Price, Transferor shall cause the Title Company to deliver to
Transferee, irrevocably, the binding commitment required by the Title Condition,
together with a written commitment by the Title Company to: (i) promptly record
the documents required to be recorded in order for the title insurance policies
called for by the Title Condition to be issued; and
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(ii) deliver said title insurance policies to Transferee within thirty (30) days
following the Closing Date. The form of Transferee's and Transferor's recording
instructions to the Title Company and the Title Company's written commitment to
comply with such instructions and the terms of this Agreement are contained in
Exhibit O.
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(d) When the Title Condition pertaining to the Closing has been
satisfied, Transferee shall arrange for delivery (i) to Intercompany Lender, in
repayment of the Assumed Indebtedness, of that portion of the Exchange Price
necessary to repay the Assumed Indebtedness by wire transfer of immediately
available funds in accordance with wiring instructions of Intercompany Lender,
and (ii) to Transferor, the Preferred Stock. Following telephonic confirmation
of such wire transfer, the other documents and instruments shall be deemed
delivered and the Closing shall be deemed consummated.
6.2 Early Deposit of Documents. On or before the Closing Date,
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Transferor, Tenant, Guarantor and/or Transferee, as the case may be, shall
deliver the following executed and acknowledged documents to the Title Company:
(a) The (i) Deed for the Property to be sold at the Closing and (ii)
the Assignment of Ground Lease for the Property to be ground leased to
Transferee at the Closing, in each case executed by Transferor in recordable
form;
(b) The Memorandum of Lease for the Property to be leased back at the
Closing, in the form of Exhibit Q, duly executed and acknowledged by Transferee
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and Tenant in recordable form;
(c) The LM Deed of Trust duly executed by the Guarantor which owns
the Lone Mountain Property in recordable form; and
(d) Such additional documents as are required by the Title Company to
be able to satisfy the Title Condition.
6.3 Deliveries by Transferor. On or prior to the Closing Date,
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Transferor shall deliver, or cause to be delivered, to Transferee Transferor's
Closing Documents (other than the Deed, the Assignment of Ground Lease, the LM
Deed of Trust and the Memorandum of Lease (the "Recorded Documents") which shall
be delivered to the Title Company) as more fully described in Exhibit R.
---------
6.4 Deliveries by Transferee. On or prior to the Closing Date,
------------------------
Transferee shall deliver to Transferor Transferee's Closing Documents as more
fully described in Exhibit S.
---------
6.5 Other Instruments. Transferor and Transferee shall each deposit
-----------------
such other instruments as are reasonably required by the Title Company or
otherwise required to consummate the exchange and leaseback of the Property and
the recording of the LM Deed of Trust in accordance with the terms of this
Agreement.
11
6.6 Prorations. No Prorations shall be required to be made in
----------
connection with the Closing since Tenant, as owner, shall be responsible for all
costs incurred in connection with the Property up to the Closing Date and
Tenant, as tenant under the Net Lease, shall be responsible for all costs
incurred in connection with the Property after the Closing Date.
6.7 Costs and Expenses. Transferor shall pay all of Transferee's
------------------
legal fees and costs, the cost of the appraisal, all expenses incurred by
Transferee in its review of the Property, and all other costs and expenses
incurred or payable in connection with this transaction, including without
limitation, the premium for the policies of title insurance called for herein
and all endorsements thereto, all recording and filing fees charged by the Title
Company to record and/or file any documents required to be recorded and/or filed
pursuant to this Agreement, all fees and costs payable to obtain the Survey and
the certificates therefor required herein, all legal fees and costs incurred by
Transferor, the cost of any documentary or other transfer taxes applicable with
respect to the exchange of the Real Property, the assignment of the Ground Lease
or the recording of the LM Deed of Trust, and all sales tax, if any, applicable
with respect to the exchange of the Personal Property and Intangible Property.
6.8 Settlement Statement. On or prior to the Closing Date,
--------------------
Transferee and Transferor shall prepare, execute and deliver a final settlement
statement showing the categories and amounts of the closing costs and all
adjustments to the Exchange Price called for herein.
ARTICLE VII
Representations and Warranties of Transferor/Tenant
---------------------------------------------------
As an inducement to Transferee to enter into this Agreement and to
consummate the exchange and leaseback transaction contemplated hereby, each of
Transferor and Tenant, jointly and severally, hereby represents and warrants to
and agrees with Transferee, both as of the date hereof and again as of the
Closing Date, that:
7.1 Condition of Property. To the knowledge (which term shall, as
---------------------
used in this Agreement, mean the actual, current the knowledge of Transferor,
Tenant, Guarantor and their respective officers, directors, members, partners
and executive level employees) of Transferor and Tenant, except as disclosed in
the environmental and any engineering reports heretofore delivered by Transferor
to Transferee, there are no material physical or mechanical defects in any of
the Improvements, including, without limitation, the plumbing, heating, air
conditioning, ventilating, life safety and electrical systems, and all such
items are in good operating condition and repair and in substantial compliance
with all Laws (including the ADA).
12
7.2 Use and Operation. To the knowledge of Transferor and Tenant,
-----------------
except as disclosed in the environmental and any engineering reports heretofore
delivered by Transferor to Transferee, the use and operation of the Property and
its facilities, fixtures, installations and equipment, comply substantially with
applicable Laws.
7.3 Utilities. All water, sewer, electric, telephone and drainage
---------
facilities and all other utilities required for the normal use and operation of
the Property are installed to the property lines of the Land, are all connected
and operating pursuant to valid permits, are adequate to service the Property
and to permit full compliance with all requirements of Law and the contemplated
usage of the Property by the present tenants or occupants thereof and their
licensees, invitees and customers, and are connected to the Property by means of
one or more public or private easements extending from the Property to one or
more public streets, public rights-of-way or utility facilities.
7.4 Use Permits and Other Approvals. Transferor or Tenant has
-------------------------------
obtained all licenses, permits, approvals, easements and rights of way required
from all governmental authorities having jurisdiction over the Property or from
private parties for the intended normal use and operation of the Property and to
ensure free and unimpeded vehicular and pedestrian ingress to and egress from
the Property as required to permit the present usage of the Property by the
occupants and tenants thereof, their invitees, licensees and customers. No
violations have been recorded in respect of any such licenses, permits or
approvals and no proceeding is pending or, to the knowledge of Transferor or
Tenant, threatened to revoke or limit any of such licenses, permits, approvals,
easements or rights of way. Transferor or Tenant, as applicable, is in
compliance with the terms of all such licenses, permits and approvals applicable
to it.
7.5 Authority of Transferor. (i) Transferor and Tenant are duly
-----------------------
formed, validly existing and in good standing under the laws of the State of
Nevada; (ii) the persons executing Transferor's Closing Documents are duly
appointed and authorized by Transferor, Tenant or Guarantor, as applicable, to
execute such documents, (iii) Transferor's Closing Documents will, when
delivered, have been duly authorized, executed and delivered by Transferor,
Tenant or Guarantor, as applicable, and will constitute legal, valid and binding
obligations of Transferor, Tenant or Guarantor, as applicable, enforceable
against such party in accordance with their terms, (iv) Transferor, Tenant or
Guarantor each has full power and authority to execute, deliver and perform its
obligations under Transferor's Closing Documents and to carry on its business as
presently conducted, (v) Transferor, Tenant or Guarantor has obtained all
necessary permits, licenses, entitlements and/or approvals and has made all
required filings with, and notifications to, all third parties and governmental
or regulatory authorities required to comply with the provisions of Transferor's
Closing Documents, including all necessary corporate action, (vi) to the
knowledge of Transferor or Tenant, Transferee is not required to obtain any
permits, licenses, entitlements and/or approvals in order to own the Property
for the purpose of leasing the Property to Tenant or complying with the
provisions of Transferor's Closing Documents, and (vii) the execution, delivery
and performance of Transferor's Closing Documents do not violate any provisions
or result in
13
any breach of or constitute a default (or an event which with notice or lapse of
time or both would become a default) of any agreement or document to which any
party thereto is a party or by which any party thereto is bound, or of any order
or regulation of any court, regulatory body, administrative agency or
governmental body having jurisdiction over any party thereto.
7.6 Zoning and Environmental.
------------------------
(a) Neither Transferor nor Tenant has obtained conditional use or
similar permits and zoning or other variances from applicable zoning, building
and land use and/or regulations in connection with the development or operation
of the Property other than that certain parking variance from the ▇▇▇▇▇ County
Department of Comprehensive Planning issued August 26, 2000 (Reference VC-1101-
94 (ET-0247-00)). Neither Transferor nor Tenant has received notice of any
investigations or intent to investigate zoning or environmental violations.
There are no condemnation, environmental, zoning or other land use regulations
or proceedings, either instituted or, to Transferor's or Tenant's current,
actual knowledge, planned or threatened, which might detrimentally affect the
use or enjoyment of the Property by Transferee in any material respect.
(b) During the period of Transferor's or Tenant's ownership, lease or
occupancy of the Property, other than those disclosed by that certain Phase I
Environmental Site Assessment by Western Technologies, Inc. dated February 16,
2000, Project No. 4180JL038 (the "Environmental Report"), to the knowledge of
Transferor and Tenant, there have been no Environmental Conditions with respect
to the Property. Neither Transferor nor Tenant has any knowledge of any
Environmental Condition with respect to the Property which may have occurred
prior to its ownership, lease or occupancy of the Property. As used herein,
"Environmental Condition" shall mean the presence, disposal, release or
threatened release of hazardous substances or hazardous wastes on, from or under
the Property. The terms "disposal", "release", "threatened release", "hazardous
substances" and "hazardous wastes" shall have the definitions assigned to those
terms by the Federal Comprehensive Environmental Response, Compensation and
Liability Act of 1980, as amended to date. Except as disclosed on Exhibit J, to
---------
the knowledge of Transferor and Tenant, there were no toxic or hazardous
materials used in the development or construction of the Improvements.
(c) With respect to the Property, to the knowledge of Transferor and
Tenant, each of Transferor and Tenant is in compliance with the provisions of
all applicable federal, state and local requirements pertaining to or governing
the use, disposal, release or presence of hazardous substances or hazardous
wastes pertaining to or governing the use, disposal, release or presence of
hazardous substances or hazardous wastes ("Environmental Laws").
(d) Transferor and Tenant shall protect, indemnify and hold harmless
Transferee, HAHF and their respective directors, officers, partners, any
partners of partners and employees from and against any and all claim, loss,
damage, cost, expense,
14
liability, fines, penalties, charges, administrative and judicial proceedings
and orders, judgments, remedial action requirements, enforcement actions of any
kind (including, without limitation, actual and customary attorneys' and
paralegals' fees and costs) directly or indirectly arising out of or
attributable to, in whole or in part, any Environmental Condition or the
violation or alleged violation of any Environmental Laws regardless of whether
or not, at the time of such activity, Transferor or Tenant owned, leased or
otherwise occupied the Property. The foregoing indemnity shall be independent
of, and in addition to, any indemnity given by Tenant under the Net Lease.
7.7 Employees. Neither Tenant nor Transferor has any outstanding
---------
employee liabilities and Transferee shall not be subject to nor assume any such
liabilities pursuant to this Agreement or any of Transferor's Closing Documents.
Neither Tenant nor Transferor has entered into any collective bargaining
agreements with any union relating to any of its respective employees other than
as disclosed on Exhibit I. Any multiemployer plan (as defined in Section
---------
4001(a)(3) of the Employee Retirement Income Security Act of 1974, as amended
from time to time ("ERISA")) to which Transferor or Tenant is a party or subject
is in compliance in all material respects with, and has been administered in all
material respects in compliance with, the applicable provisions of ERISA, the
Code and other applicable laws. There are no unfunded liabilities with respect
to any such multiemployer plans.
7.8 Asbestos. Except as previously disclosed in writing by
--------
Transferor or Tenant or by the Environmental Report, to the knowledge of
Transferor, there is no asbestos in any of the Improvements or personal property
used in connection with the Property.
7.9 Leases. There are no leases, tenancies or license, franchise,
------
occupancy, concession or other agreements pertaining to possession or ownership
of any Parcel or any portion thereof, other than those set forth in Exhibit H.
---------
There are no "FF&E" leases with respect to the Property.
7.10 Material Contracts.
------------------
(a) Other than as listed in Exhibit J, neither Tenant nor Transferor
---------
has any obligation under the terms of any contract or other instrument relating
to the maintenance or operation of the Property and there will be, as of the
Closing Date, no such obligation.
(b) Other than as listed in Exhibit I (all such items so listed, the
---------
"Contracts"), neither Tenant nor Transferor is a party to or bound by, or
derives any benefit from, any contract, agreement, indenture or other instrument
or commitment, whether written or oral, relating to the Property which is: (i)
a material contract not made in the ordinary course of business; (ii) a covenant
not to compete or confidentiality or non-disclosure agreement; (iii) a contract
for the sale of any assets of Tenant or Transferor or the grant of any
preferential rights to purchase any assets of Tenant or Transferor or requiring
the consent of any party to the transfer thereof; (iv) any loan
15
agreement, indenture, promissory note or conditional sales agreement or any
pledge, security agreement, deed of trust, financing statement or other document
granting any Lien on any asset, right or property of Tenant or Transferor other
than the Intercompany Indebtedness; (v) any revocable or irrevocable power of
attorney in favor of any third party for any reason; (vi) a franchise agreement,
license agreement, facilities agreement or other agreement or arrangement with a
hotel operating company, hotel supply company, franchisor, reservations service
or similar hospitality company; or (vii) any other agreement which is not
terminable upon not more than ninety (90) days' notice without cost or other
liability at any time after the Closing or which requires payments thereunder by
Tenant or Transferor of One Hundred Thousand Dollars ($10,000) or more. Tenant
and Transferor, as the case may be, each have performed in all material respects
all of the obligations required to be performed by it under the Contracts to
which it is a party to the date hereof. The Contracts are enforceable against
Tenant or Transferor, as applicable, and to Tenant's and Transferor's knowledge,
enforceable against the other parties thereto, in accordance with the terms
thereof. Neither Tenant nor Transferor, nor, to Tenant's and Transferor's
knowledge, the other parties to the Contracts, are in default or alleged to be
in default in any respect under any of the Contracts and there exists no event,
condition or occurrence which, after notice and/or lapse of time would
constitute such a default by Tenant or Transferor or any of the other parties
thereto of any of the foregoing. The listing of the Contracts in Exhibit I is
---------
true, correct and complete and Tenant and Transferor have provided the Company
with true, correct and complete copies of all of the Contracts.
7.11 Litigation. Other than as listed in Exhibit U, there is no
---------- ---------
litigation pending or, after due and diligent inquiry, to the best of
Transferor's and Tenant's knowledge, threatened, against Transferor or Tenant or
Guarantor, that arises out of the ownership or operation of the Property (or the
Lone Mountain Property) including, without limitation, unfair labor practice
charges, discrimination, harassment claims, wage and hour claims or worker
compensation claims; and (i) might materially and detrimentally affect the use
and operation of the Property (or the Lone Mountain Property) for its current
usage or the value of the Property (or the Lone Mountain Property), or (ii)
might materially and adversely affect the ability of Transferor, Tenant or any
Guarantor to perform obligations under any of Transferor's Closing Documents, or
(iii) might constitute or result in a lien on the Property (or the Lone Mountain
Property) or any portion thereof.
7.12 Other Contracts to Convey Property. Neither Tenant nor
----------------------------------
Transferor has committed or obligated itself in any manner whatsoever to
transfer or lease the Property (or the Lone Mountain Property), or any portion
thereof, to any party other than Transferee. Neither Tenant nor Transferor has
hypothecated or assigned any rents or income from the Property, except for
hypothecations or assignments on behalf of lenders with respect to loans to
Transferor or Tenant which will be terminated or as to which releases of such
lenders' liens will be obtained at the Closing. No person or entity has any
right to acquire or to lease the Property (or the Lone Mountain Property) or any
part thereof, or to obtain any interest therein. There are no outstanding
rights of first
16
refusal, rights of reverter or options relating to the Property (or the Lone
Mountain Property, with the exception of the purchase option set forth in the
Lone Mountain Title Policy) or any interest therein. No person or entity holding
a security interest in the Property (or the Lone Mountain Property) or any part
thereof has the right to consent or deny consent to the exchange or lease of the
Property (or the encumbrance of the Lone Mountain Property) as contemplated
herein.
7.13 Conflicts. The terms of this Agreement do not conflict with or
---------
result in a breach or violation of any term or provision of, or constitute a
default under (i) the organizational documents of Transferor, Tenant or
Guarantor or (ii) any mortgage, deed of trust, lease, license or other agreement
or instrument to which any such party is a party or by which such party or any
of its assets, properties or rights is bound.
7.14 Full Disclosure. To the knowledge of Transferor and Tenant,
---------------
neither this Agreement nor any exhibit hereto nor any letter, certificate or
other document furnished by Transferor, Guarantor or Tenant to Transferee
pursuant hereto contains any untrue statement of a material fact or omits to
state a material fact necessary to make the statements contained in this
Agreement and the exhibits, in the light of the circumstances under which they
were made, not misleading. Subject to the limitations set forth below, each of
Tenant and Transferor hereby agrees to indemnify, defend, protect and hold
Transferee harmless from and against any and all loss, cost, liability, damage,
claim and expense including, without limitation, reasonable attorneys' and
paralegals' fees and expenses incurred by Transferee in connection with or
arising from any breach by Transferor or Tenant of any of the representations
and warranties made by Transferor or Tenant in this Agreement.
7.15 Intellectual Property. (a) Exhibit P attached hereto sets forth
--------------------- ---------
a true, correct and complete list of (i) all patents, patent rights, patent
applications, copyrights, copyright registrations, trade secrets, rights of
priority, know how, trademarks, service marks, trademark and service ▇▇▇▇
registrations and registered domain names, together with the right to secure
reissuances and extensions of any of the foregoing (collectively, "Intellectual
Property") owned by Tenant and Transferor, and (ii) all licenses, agreements and
royalty arrangements which are currently in effect granted by Tenant or
Transferor to any Person or by any Person to Tenant or Transferor for the use of
any Intellectual Property related to Tenant's or Transferor's ownership and use
of the Property. All of the Intellectual Property listed on Exhibit P as being
---------
owned by Tenant or Transferor is owned solely and exclusively by Tenant or
Transferor free and clear of all Liens. All copyright, trademark, service ▇▇▇▇
and domain name registrations set forth on Exhibit P attached hereto are in full
---------
force and effect. (b) To the knowledge of Tenant or Transferor, no Person is
infringing on any Intellectual Property owned by Tenant or Transferor. No
claims have been asserted or are pending or threatened by any third party
against Investor alleging that the use by Tenant or Transferor of any
Intellectual Property infringes or conflicts with the rights of any third party.
7.16 Intercompany Debt. Except for the Intercompany Indebtedness,
-----------------
which shall be satisfied to the extent of the Assumed Indebtedness (and the
Remaining
17
Intercompany Indebtedness, which shall continue as an unsecured obligation of
Tenant), there is no other indebtedness owed or owing by Tenant or Transferor to
any Guarantor or any other person other than the Remaining Intercompany
Indebtedness and other than trade payables of Tenant incurred in the ordinary
course of operating the Property (including payments to Tenant under the
Management Agreement (as defined in the Net Lease)), none of which is more than
sixty (60) days overdue.
7.17 Investment Representations.
--------------------------
(a) Transferor is acquiring the Preferred Stock for its own account,
for investment and not with a view to the distribution thereof, nor with any
present intention of distributing the same.
(b) Transferor understands that the Preferred Stock has not been
registered under the Securities Act of 1933, as amended (the "Securities Act"),
by reason of its issuance in a transaction exempt from the registration
requirements of the Securities Act, and that the Preferred Stock must be held
indefinitely unless a subsequent disposition thereof is registered under the
Securities Act or is exempt from registration.
(c) Transferor has had a reasonable time prior to the date hereof to
ask questions and receive answers concerning the terms of the offering of the
Preferred Stock pursuant to this Agreement, to discuss the terms under which
investment in HAHF is made, and to obtain any additional information which HAHF
possesses or could acquire without unreasonable effort or expense. Transferor
has such knowledge and experience in business and financial matters and with
respect to investments in securities of privately held companies as to enable
Transferor to understand and evaluate the risks of such investment and form an
investment decision with respect thereto. Transferor has made, either alone or
together with its advisors, such independent investigation of HAHF as it deems
to be, or its advisors deem to be, necessary or advisable in connection with the
investment made hereby. Transferor has not relied on the Transferee or HAHF nor
any of their respective advisors, with respect to the federal, state, local,
foreign and other tax consequences arising from Transferor's purchase, ownership
and disposition of the Preferred Stock.
(d) Transferor (i) has been advised and understands that no public
market now exists for the Preferred Stock and that a public market may never
exist for the Preferred Stock, (ii) has no need for liquidity in its investment
in HAHF, and (iii) is able to bear the economic risk of such investment for an
indefinite period and to afford a complete loss thereof.
(e) Transferor is an "accredited investor," as such term is defined
in Rule 501 promulgated under the Securities Act.
(f) Transferor agrees that the Preferred Stock will not be resold
without registration thereof under the Securities Act unless (i) Transferor
shall have notified HAHF of the proposed disposition and shall have furnished
HAHF with a
18
statement of the circumstances surrounding the disposition and (ii) at its
expense or at the expense of its transferee, Transferor shall have furnished to
HAHF an opinion of counsel, reasonably satisfactory (as to counsel and as to
substance) to HAHF and its counsel, to the effect that such transfer may be made
without registration of the Preferred Stock under the Securities Act and
applicable state securities laws.
(g) Transferee shall cause HAHF to make a notation regarding the
restrictions on transfer of the Preferred Stock in its stock books, and the
Preferred Stock shall be transferred on the books of HAHF only if transferred or
sold pursuant to an effective registration statement under the Securities Act
and applicable state securities laws or an available exemption from registration
thereunder.
(h) Transferor agrees to the imprinting of legends on certificates
representing all of the Preferred Stock to the following effect:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY
APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE BEEN ACQUIRED
FOR INVESTMENT AND NOT WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY
NOT BE OFFERED FOR SALE, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER
THE SECURITIES ACT OF 1933 AND ANY APPLICABLE STATE SECURITIES LAWS OR
AN OPINION OF COUNSEL REASONABLY SATISFACTORY IN FORM AND CONTENT TO
THE ISSUER THAT SUCH REGISTRATION IS NOT REQUIRED.
7.18 No Other Property. The Property conveyed and/or assigned to
-----------------
Transferee pursuant to this Agreement constitutes all of the Property owned by
Tenant immediately prior to its conveyance and/or assignment of the Property to
Transferor in connection with this transaction, except for the property leased
pursuant to the Gaming Lease, all of which shall be subject to the Gaming Lease,
and constitutes all of the property required for the operation of the Property
as is currently conducted, except for such property leased pursuant to the
Gaming Lease.
7.19 Absence of Certain Changes or Events. Since September 30, 1999,
------------------------------------
Tenant and Transferor each has conducted its business in the ordinary course and
in a manner consistent with past practice and, since such date, there has not
been (i) any materially adverse change in the financial condition, results of
operations or business of Tenant or Transferor, (ii) any damage, destruction or
loss (whether
19
or not covered by insurance) with respect to any assets of Tenant or Transferor,
(iii) any change by Tenant or Transferor in its accounting methods, principles
or practices, (iv) any obligation or liability incurred by Tenant or Transferor
(whether absolute, accrued, contingent or otherwise and whether due or to become
due), or any transaction, contract or commitment entered into by Tenant or
Transferor in connection with its business, other than such items incurred or
entered into in the ordinary course of business and in a manner consistent with
past practice, (v) any revaluation by Tenant or Transferor of its assets,
including, without limitation, writing down or writing off the value of any
inventory or writing down or writing off the value of any notes or accounts
receivable other than in the ordinary course of business, (vi) any license,
sale, transfer, pledge, mortgage or other disposition of any tangible or
intangible asset of Tenant or Transferor other than in the ordinary course of
business and in a manner consistent with past practice, (vii) any other
transaction in connection with the businesses of Tenant or Transferor other than
in the ordinary course of business and in a manner consistent with past
practice, or (viii) any agreement or understanding, whether in writing or
otherwise, for Investor to take any of the actions specified in clauses (i)
through (vii) above.
7.20 Limitation of Transferor's/Tenant's Representations and
-------------------------------------------------------
Warranties. TRANSFEREE ACKNOWLEDGES THAT TRANSFEROR AND TENANT HAVE MADE NO
----------
REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, OTHER THAN THOSE EXPRESSLY
CONTAINED IN THIS AGREEMENT AND THE TRANSFEROR'S CLOSING DOCUMENTS TO WHICH THEY
ARE A PARTY, AND THAT SUCH REPRESENTATIONS SHALL SURVIVE UNTIL SUCH TIME AS THE
NET LEASE HAS EXPIRED.
ARTICLE VIII
Representations and Warranties of Transferee and HAHF
-----------------------------------------------------
8.1 Representations and Warranties of Transferee and HAHF. Each of
-----------------------------------------------------
Transferee and HAHF hereby represents and warrants to Transferor that (i)
Transferee is a limited liability company duly organized, validly existing and
in good standing under the laws of the State of Delaware, (ii) HAHF is a
corporation duly organized, validly existing and in good standing under the laws
of the State of Florida, (iii) the persons executing Transferee's Closing
Documents are duly appointed and authorized by Transferee or HAHF, as
applicable, to execute such documents, (iv) Transferee's Closing Documents will,
when delivered, have been duly authorized, executed and delivered by Transferee
or HAHF, as applicable, and will constitute legal, valid and binding obligations
of Transferee or HAHF, as applicable, and this Agreement will be enforceable
against Transferee and HAHF in accordance with its terms, (v) each of Transferee
and HAHF, as applicable, has full power and authority to execute, deliver and
perform its obligations under the Transferee's Closing Documents to which it is
a party, (vi) to the current, actual knowledge of Transferee, Transferee is not
required to obtain any permits, licenses, entitlements and/or approvals in order
to own the Property for the purpose of leasing the Property to Tenant or
complying with the provisions of Transferor's Closing Documents, and (vii) the
execution, delivery and performance of Transferee's Closing Documents do not
violate any provisions of any agreement or document to which Transferee or HAHF
is
20
bound, or of any order or regulation of any court, regulatory body,
administrative agency or governmental body having jurisdiction over Transferee
or HAHF.
8.2 Authorized and Outstanding Shares of Capital Stock; Options and
---------------------------------------------------------------
Other Rights to Acquire Capital Stock. The authorized capital stock of HAHF
-------------------------------------
consists of (i) 4,000 shares of common stock, $1.00 par value per share and (ii)
10,000 shares of preferred stock, par value $1,000 per share, of which 10,000
shares have been designated as Series A Cumulative Redeemable Preferred Stock.
Immediately prior to the Closing, there were outstanding: (i) 1,200 shares of
common stock and (ii) 2,000 shares of Series A Cumulative Redeemable Preferred
Stock. There is no outstanding option, warrant, call, commitment or other
agreement to which HAHF is a party requiring, and there are no convertible
securities of HAHF outstanding which upon conversion would require, the issuance
of any additional shares of capital stock of HAHF or other securities
convertible into shares of equity securities of HAHF. There are no agreements
with respect to the voting or transfer of the capital stock of HAHF or with
respect to any other aspect of HAHF's affairs. There are no stockholders'
preemptive rights, nor are there any rights of first refusal or other similar
rights with respect to the issuance of capital stock by HAHF.
8.3 Authorization and Issuance of the Securities. The issuance and
--------------------------------------------
sale of the Preferred Stock has been duly authorized by all necessary corporate
action on the part of HAHF and, upon delivery to Transferor of the Preferred
Stock in accordance with the terms hereof, the Preferred Stock will be validly
issued, fully paid and non-assessable, and will be free and clear of all liens
(other than those created by Transferor) and preemptive rights.
8.4 Securities Laws. In reliance in part on the investment
---------------
representations contained in Section 7.17 of this Agreement, the offer,
------------
issuance, sale and delivery of the Preferred Stock, as provided in this
Agreement, are exempt from the registration requirements of the Securities Act,
and all applicable state securities laws. Neither HAHF nor any person acting on
its behalf has taken or will take any action (including, without limitation, any
offering of any securities of HAHF under circumstances which would require the
integration of such offering with the offering of the Preferred Stock under the
Securities Act and the rules and regulations of the Securities and Exchange
Commission thereunder) which might subject the offering, issuance or sale of
the Preferred Stock to the registration requirements of Section 5 of the
Securities Act.
8.5 Corporate Existence; Compliance with Law. HAHF and each of its
----------------------------------------
subsidiaries (i) is a corporation, partnership or limited liability company duly
formed, validly existing and in good standing under the laws of their respective
jurisdictions of incorporation or formation; (ii) is duly qualified as a foreign
corporation, partnership or limited liability company and in good standing under
the laws of each jurisdiction where its ownership or lease of property or the
conduct of its business requires such qualification; (iii) has the requisite
corporate, partnership or limited liability company power and authority and the
legal right to own, pledge, mortgage or otherwise
21
encumber and operate its properties, to lease the property it operates under
lease, and to conduct its business as now being conducted; (iv) has all permits
from or by, and has made all filings with, and has given all notices to, all
governmental authorities having jurisdiction, to the extent required for such
ownership, operation and conduct; (v) is in compliance with its certificate or
articles of incorporation and by-laws or, if not a corporation, its governing
documents; and (vi) is in compliance with all applicable provisions of law,
except with respect to clauses (ii) through (vi) where such failure,
individually or in the aggregate, would not have a material adverse effect on
HAHF and its subsidiaries, considered as a whole.
8.6 Subsidiaries. HAHF has no subsidiaries other than HAHF Trust I
------------
and HAHF II, each of which are special purpose entities wholly owned by HAHF.
8.7 Corporate Power; Authorization; Enforceable Obligations. The
-------------------------------------------------------
execution, delivery and performance by HAHF of this Agreement and the issuance
and sale of the Preferred Stock pursuant hereto: (i) are within HAHF's
corporate power and authority; (ii) have been duly authorized by all necessary
corporate action; (iii) are not in contravention of any provision of HAHF's
articles of incorporation or by-laws; (iv) will not violate any law or
regulation applicable to HAHF or its subsidiaries, or any order or decree of any
court or governmental instrumentality binding upon HAHF or its subsidiaries; (v)
will not conflict with or result in the breach or termination of, the loss of
any benefit to which HAHF is entitled under, constitute a default or require any
payment to be made by HAHF under, or accelerate any performance required by, any
indenture, mortgage, deed of trust, loan, credit agreement, lease, agreement or
other instrument to which HAHF or any of its subsidiaries is a party or by which
HAHF or any of its subsidiaries or any of their property is bound; (vi) will not
result in the creation or imposition of any lien upon any of the property of
HAHF or any of its subsidiaries; and (vii) do not require the consent or
approval of, or any filing with, any governmental authority or any other person,
except, in the case of clauses (iv) through (vii), any such violation, conflict,
breach, termination, loss, default, payment, acceleration, creation, imposition
or failure to obtain the consent or approval, individually or in the aggregate,
that would not have a material adverse effect on HAHF and its subsidiaries
considered as a whole or on HAHF's ability to own its assets and conduct its
business.
8.8 Financial Statements. The unaudited financial statements of HAHF
--------------------
for the period January 2000 through November 2000 (the "Company Financial
Statements") fairly present the consolidated financial position of HAHF and its
subsidiaries as at the dates thereof and the consolidated results of their
operations and cash flows for the period then ended.
8.9 No Undisclosed Liabilities. Except as disclosed in the Company
--------------------------
Financial Statements, none of HAHF or any of its subsidiaries has any material
indebtedness or obligations, contingent or otherwise.
8.10 Labor Matters. There are no strikes or other collective labor
-------------
disputes against HAHF or any of its subsidiaries pending or, to HAHF's or its
22
subsidiaries' knowledge, threatened. Neither HAHF nor any of its subsidiaries
is a party to any labor or collective bargaining agreement and there are no
labor or collective bargaining agreements which pertain to employees of HAHF or
any of its subsidiaries.
8.11 Litigation. There is no litigation pending or, to the best of
----------
HAHF's knowledge, threatened, against HAHF, its subsidiaries or any of their
respective assets, including, without limitation, unfair labor practice charges,
discrimination, harassment claims, wage and hour claims or worker compensation
claims that would reasonably be expected to have a material adverse effect on
HAHF and its subsidiaries, considered as a whole.
8.12 Full Disclosure. To the knowledge of HAHF, neither this
---------------
Agreement nor any information furnished by HAHF to Transferor with respect to
HAHF or its business, results of operation financial condition or assets,
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained therein, in the light of the
circumstances under which they were made, not misleading.
8.13 Limitation of Transferee's and HAHF's Representations and
---------------------------------------------------------
Warranties. EACH OF TRANSFEROR AND TENANT ACKNOWLEDGES THAT NEITHER TRANSFEREE
----------
NOR HAHF HAS MADE ANY REPRESENTATIONS OR WARRANTIES, EXPRESS OR IMPLIED, OTHER
THAN THOSE EXPRESSLY CONTAINED IN THIS AGREEMENT.
8.14 Covenant of HAHF. HAHF agrees that, so long as Transferor holds
----------------
the Preferred Stock, HAHF (a) shall deliver quarterly and annual unaudited
financial statements to Transferor and, if reasonably requested to do so by
Transferor, have such annual financial statements audited by an auditor of
HAHF's choice and (b) shall not, without the consent of Transferor, authorize,
create or increase the authorized or issued amount of any class or series of
capital stock ranking senior to or on parity with the Preferred Stock as to
dividends or upon liquidation.
ARTICLE IX
Miscellaneous
-------------
9.1 Notices. All notices, consents, approvals or other
-------
communications required or permitted to be given under this Agreement shall be
in writing and be deemed to have been duly given (i) when delivered personally
if delivered on a business day (or if the same is not a business day, then the
next business day after delivery), (ii) three (3) business days after being sent
by United States mail, registered or certified mail, postage prepaid, return
receipt requested or (iii) if delivery is made by Federal Express or a similar,
nationally recognized overnight courier service for 9:00 a.m. delivery, then on
23
the date of delivery (or if the same is not a business day, then the next
business day after delivery); and addressed as follows:
If to Transferor or Tenant: c/o Santa Fe Gaming Corporation
--------------------------
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇ Land
with a copy to: ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇
If to Transferee or HAHF: c/▇ ▇▇▇▇▇▇ EMX, Inc.
------------------------
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
with a copy to: ▇▇▇▇▇▇ EMX, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: V. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
with a copy to: Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
Park Avenue Tower
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇. ▇'▇▇▇▇, Esq.
or such other address as either party may from time to time specify in writing
to the other in the manner aforesaid.
9.2 Brokers and Finders. Each party represents to the other party
-------------------
that the representing party has incurred no liability for any brokerage
commission or finder's fee arising from or relating to the transactions
contemplated by this Agreement. In the event of a claim for any broker's fee,
finder's fee, commission or other similar compensation in connection herewith,
(a) Transferee, if such claim is based upon any agreement alleged to have been
made by Transferee, hereby agrees to indemnify, defend, protect and hold
Transferor harmless against any and all liability, loss, cost, damage or expense
(including reasonable attorneys' and paralegals' fees and costs) which
Transferor may sustain or incur by reason of such claim, and (b) Transferor, if
such claim is based upon any agreement alleged to have been made by Transferor,
hereby agrees to indemnify, defend, protect and hold Transferee harmless against
any and all liability, loss, cost, damage or expense (including reasonable
attorneys' and paralegals' fees and costs) which Transferee may sustain or incur
by reason of such claim.
24
9.3 Successors and Assigns. This Agreement shall be binding upon,
----------------------
and inure to the benefit of, the parties hereto and their respective successors,
heirs, administrators and assigns, except that neither party's interest under
this Agreement may be assigned, encumbered or otherwise transferred, whether
voluntarily, involuntarily, by operation of law or otherwise, without the prior
written consent of the other party; provided, however, without being relieved of
-------- -------
any liability under this Agreement, Transferee reserves the right to assign its
rights and obligations hereunder to any entity with which it is affiliated.
9.4 Amendments. This Agreement may be amended or modified only by a
----------
written instrument executed by the party asserted to be bound thereby.
9.5 Continuation and Survival of Indemnities, Representations and
-------------------------------------------------------------
Warranties. Except as expressly provided to the contrary in this Agreement, all
----------
indemnities, representations and warranties by Transferor, Tenant, HAHF or
Transferee contained herein or made in writing pursuant to this Agreement or any
other instrument delivered by Transferor, Tenant, HAHF or Transferee pursuant
hereto are intended to and shall remain true, correct and binding as of the time
of Closing and shall survive the execution and delivery of this Agreement, the
delivery of the Deed and the transfer of title to the Property for a period of
two (2) years. All representations and warranties of Transferor or Tenant
contained in any certificate or other instrument delivered at any time by or on
behalf of Transferor or Tenant in connection with the transaction contemplated
hereby shall constitute representations and warranties hereunder.
9.6 Interpretation. Whenever used herein, the term "including" shall
--------------
be deemed to be followed by the words "without limitation." Words used in the
singular number shall include the plural, and vice-versa, and any gender shall
be deemed to include each other gender. The captions and headings of the
Articles and Sections of this Agreement are for convenience of reference only,
and shall not be deemed to define or limit the provisions hereof.
9.7 Governing Law. This Agreement shall be governed by and construed
-------------
in accordance with the internal laws of the State of New York, except that the
laws with respect to conflict of laws shall be disregarded.
9.8 Merger of Prior Agreements. This Agreement (including the
--------------------------
exhibits hereto) constitutes the entire agreement between the parties with
respect to the acquisition, assignment and exchange of the Property specifically
described herein and supersedes all prior and contemporaneous (whether oral or
written) agreements and understandings between the parties hereto relating to
the specific subject matter hereof.
9.9 Attorneys' Fees. In the event of any action or proceeding at law
---------------
or in equity between Transferee or HAHF and Transferor or Tenant (including an
action or proceeding between Transferee and the trustee or debtor in possession
while Transferor or Tenant is a debtor in a proceeding under the Bankruptcy Code
(Title 11 of the United States Code) or any successor statute to such Code) to
enforce or interpret any
25
provision of this Agreement or to protect or establish any right or remedy of
any party hereunder, the unsuccessful party to such action or proceeding shall
pay to the prevailing party all costs and expenses, including, without
limitation, reasonable attorneys' and paralegals' fees and expenses, incurred in
such action or proceeding and in any appeal in connection therewith by such
prevailing party, whether or not such action, proceeding or appeal is prosecuted
to judgment or other final determination, together with all costs of enforcement
and/or collection of any judgment or other relief. The term "prevailing party"
shall include, without limitation, a party who brings an action against the
other by reason of the other's breach or default and obtains substantially the
relief sought, whether by compromise, settlement or judgment. If such prevailing
party shall recover judgment in any such action, proceeding or appeal, such
costs, expenses and attorneys' and paralegals' fees shall be included in and as
a part of such judgment.
9.10 Relationship. It is not intended by this Agreement to, and
------------
nothing contained in this Agreement shall, create any partnership, joint
venture, financing arrangement or other agreement between the parties hereto.
No term or provision of this Agreement is intended to be, or shall be, for the
benefit of any person, firm, organization or corporation not a party hereto, and
no such other person, firm, organization or corporation shall have any right or
cause of action hereunder.
9.11 Authority. The individuals signing below represent and warrant
---------
that they have the requisite authority to bind the entities on whose behalf they
are signing.
9.12 Counterparts. This Agreement may be executed in one or more
------------
counterparts, each of which shall be deemed an original, but all of which
together shall constitute but one and the same instrument. It shall be
necessary to account for only one fully executed counterpart in proving this
Agreement.
9.13 Exhibits. References in this Agreement to Exhibits mean the
--------
exhibits described in the List of Exhibits attached hereto, all of which
exhibits are incorporated by reference into this Agreement.
26
9.14 Access; Confidentiality. After reasonable notice provided by
-----------------------
Transferee, Transferor and Tenant shall give, and shall authorize and instruct
its counsel, its accountants and its other agents and representatives to give to
Transferee and Transferee's counsel, accountants and other representatives full
access during normal business hours to the Property and to all of Transferor's
and Tenant's books, contracts and records related to the Property, and shall
furnish such information and copies of such materials related to the Property as
Transferee from time to time reasonably may request. All information so learned
by Transferee shall be kept in confidence pending the Closing. If the Closing
does not take place for any reason, Transferee shall keep such information in
confidence thereafter (unless and until such information otherwise is or becomes
public knowledge through no fault of Transferee) and shall promptly return to
Transferor all materials so provided by Transferor or Tenant; provided,
--------
however, that the foregoing shall not prohibit Transferee from utilizing such
-------
information or materials in connection with the exercise of its rights
hereunder.
27
IN WITNESS WHEREOF, Transferor, Tenant, Transferee and HAHF have
executed this Agreement as of the date first above written.
"TRANSFEREE"
HAHF PIONEER, LLC,
a Delaware limited liability company
By: ▇▇▇▇▇▇ AFFORDABLE HOUSING OF FLORIDA,
INC., a Florida corporation, its sole
member
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------
Title: Sole Member
--------------------------
"TRANSFEROR"
PIONEER LLC,
a Nevada limited liability company
By: /s/ ▇▇▇▇▇▇ ▇. Land
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. Land
-------------------------------------
Title: Manager
------------------------------------
"TENANT"
PIONEER HOTEL INC.,
a Nevada corporation
By: /s/ ▇▇▇▇▇▇ ▇. Land
---------------------------------------
Name: ▇▇▇▇▇▇ ▇. Land
-------------------------------------
Title: SVP & CFO
------------------------------------
"HAHF"
▇▇▇▇▇▇ AFFORDABLE HOUSING OF FLORIDA,
INC.,
a Florida corporation
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
---------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-------------------------------------
Title: Executive Vice President
EXHIBIT A-1
-----------
Description of Owned Land
-------------------------
The land referred to herein is situated in the State of Nevada, County of ▇▇▇▇▇,
described as follows:
PARCEL I:
That portion of Government Lot Four (4) of Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:
Lots One (1) and Two (2) as shown by map in File 40 of Parcel Maps, Page 30, in
the Office of the County Recorder of ▇▇▇▇▇ County, Nevada.
TOGETHER WITH a Right-of-Way easement for road purposes with the right of egress
and ingress over and across a strip of land 60 feet in width lying immediately
West of and adjacent to the West line of the hereinabove described parcel of
land and over and across a strip of land 60 feet in width being the Northerly
extension of the first mentioned strip of land and along on an existing road.
The last mentioned strip of land is to terminate on an existing County Road
located near the Northwest Corner of Government Lot Three (3) in said Section
13.
EXCEPTING THEREFROM those portions of said land as taken by that certain Final
Order of Condemnation recorded April 10, 1989 in Book 890410 as Document No.
00511, described as follows:
Parcel 1 - Water Well Site - Fee Title:
Fee Simple Title in the name of BIG BEND WATER DISTRICT, a general improvement
district, its successors and assigns, to:
That portion of government Lot Four (4) in Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:
COMMENCING at the Northwest Corner of Lot Two (2) as designated by Parcel Map on
file in File 40, Page 30 of Parcel Maps in the Office of the County Recorder of
▇▇▇▇▇ County, Nevada; thence South 89E59'51" East along the North line of said
Lot Two (2) a distance of 720.00 feet to a point; thence South 0E00'09" West a
distance of 18.00 feet to the TRUE POINT OF BEGINNING; thence continuing South
0E00'09" West a distance of 14.00 feet to a point; thence South 44E59'51" East a
distance of 14.14 feet to a point; thence South 83E59'51" East a distance of
30.00 feet to a point; thence North 0E00'09" East a distance of 24.00 feet to a
point; thence North 89E59'51" West a distance of 40.00 feet to the TRUE POINT OF
BEGINNING.
A-1-1
Parcel 2 - Easement:
A perpetual easement in the name of BIG BEND WATER DISTRICT, a general
improvement district, its successors and assigns, "District", for the
construction, operation, maintenance, repair, renewal, reconstruction and
removal of a District water well, pipe lines, electrical line, pumps, casings,
meters, equipment, telemetry devices and appurtenances thereto belonging,
including ingress and egress, and for the accommodation of construction
equipment, building materials, refuse, drilling residues, and excavation
materials, over, along and across:
That portion of Government Lot Four (4) in Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:
COMMENCING at the Northwest Corner (NW Cor) of Lot Two (2) as designated by
Parcel Map on file in File 40, Page 30 of Parcel Maps in the Office of the
County Recorder of ▇▇▇▇▇ County, Nevada; thence South 89E59'51" East along the
North line of said Lot Two (2) a distance of 768.39 feet to the TRUE POINT OF
BEGINNING; thence North 89E59'51" West a distance of 73.39 feet to a point;
thence South 0E00'09" West a distance of 43.00 feet to a point; thence South
89E59'51" East a distance of 72.93 feet more or less to a point on the East line
of said Government Lot 4; thence Northerly along the last mentioned East line a
distance of 43.00 feet to the TRUE POINT OF BEGINNING.
EXCEPTING from the hereinabove described parcel, the following described portion
thereof:
COMMENCING at the Northwest Corner (NW Cor) of said parcel; thence South
89E59'51" East along the North line thereof a distance of 30.00 feet to a point;
thence South 0E00'09" West a distance of 18.00 feet to the TRUE POINT OF
BEGINNING of the parcel described herein; thence South 0E00'09" West a distance
of 14.00 feet to a point; thence South 44E59'51" East a distance of 14.14 feet
to a point; thence South 89E59'51" East a distance of 30.00 feet to a point;
thence North 0E00'09" East a distance of 24.00 feet to a point; thence North
89E59'51" West a distance of 40.00 feet to the TRUE POINT OF BEGINNING.
Said easement to prohibit buildings, structures, fences, trees or similar items
from being placed upon, over, or under such easement, except the same may be
improved and used for automobile parking, driveways, and landscaped with lawn
and shallow rooted shrubs and for similar purposes insofar as such uses do not
interfere with the use and enjoyment of the easement by the District.
EXCEPTING THEREFROM THAT PORTION CONVEYED TO ▇▇▇▇▇ COUNTY BY QUITCLAIM DEED
RECORDED MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00659, OFFICIAL RECORDS.
A-1-2
PARCEL II:
That portion of Government Lot Four (4) in Section 13, Township 32 South, Range
66 East, M.D.B.&M., described as follows:
COMMENCING at the Northwest Corner (NW Cor) of said Lot Four (4); thence South
l(degree)10'14" West, along the West line of said Lot Four (4), a distance of
900.20 feet to a point; thence East, a distance of 182.44 feet to the TRUE POINT
OF BEGINNING; thence North 01(degree)05'50" East, a distance of 220.10 feet to a
point; thence East to a point on the East line of said Government Lot Four (4);
thence Southerly along the said East line to a point which bears due East from
the TRUE POINT OF BEGINNING; thence West, parallel to the North line of said Lot
Four (4) to the TRUE POINT OF BEGINNING.
EXCEPTING THEREFROM THAT PORTION CONVEYED TO ▇▇▇▇▇ COUNTY BY QUITCLAIM DEED
RECORDED MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00659, OFFICIAL RECORDS.
A-1-3
EXHIBIT A-2
-----------
Description of Ground Leased Land
---------------------------------
PARCEL III:
A LEASEHOLD ESTATE, AS CREATED BY THAT CERTAIN LEASE DATED OCTOBER 31, 1978 BY
PALMALL PROPERTIES, INC, A CALIFORNIA CORPORATION, ▇▇▇▇▇▇ ▇▇▇▇▇▇ AND ▇▇▇▇▇▇
▇▇▇▇▇ (AS SUCCESSOR IN INTEREST TO ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, DECEASED, AND ▇.▇.
▇▇▇▇▇▇▇▇ AKA ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, DECEASED) AS ("LESSOR") AND PIONEER HOTEL INC.
(AS SUCCESSOR IN INTEREST TO COLORADO RIVER MOTEL AND CASINO, INC. AND COLORADO
RIVER RESORT HOTEL, INC. AND ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇) AS ("LESSEE"); TERM: 99 YEARS,
COMMENCING ON JANUARY 1, 1979 AND ENDING ON DECEMBER 31, 2078 IN AND TO THE
FOLLOWING:
That portion of Government Lot Four (4), Section 13, Township 32 south, Range 66
East, M.D.B.&M., ▇▇▇▇▇ County, Nevada, described as follows:
COMMENCING at the Northwest Corner (NW Cor) of Government Lot Four (4) in said
Section 13; thence South 1(degree)10'14" West along the West line of said Lot
Four (4) a distance of 379.73 feet to a point; thence East parallel with the
North line of said Lot Four (4) a distance of 182.44 feet to the Northwest
Corner (NW Cor) of that certain parcel of land conveyed by E.L. CLEVELAND to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ by Deed recorded February 8, 1960, as Document No. 187365
of Official Records, ▇▇▇▇▇ County, Nevada, the TRUE POINT OF BEGINNING; thence
North 1(degree)10'14" East a distance of 100.05 feet to a point; thence East and
parallel with the North line of said Lot Four (4) a distance of 766.45 feet to a
point in the East line of said Lot Four (4); thence South 10(degrees)34'08" West
a distance of 101.73 feet to the Northeast Corner (NE Cor) of the hereinabove
described parcel conveyed to ▇▇▇▇▇▇▇; thence West a distance of 750.73 feet to
the TRUE POINT OF BEGINNING.
TOGETHER WITH Right-of-Way and easement for road purposes with the right of
egress and ingress over and across a strip of land 60 feet in width lying
immediately West of and adjacent to the West line of the hereinabove described
parcel of land and over and across a strip of land 60 feet in width being the
Northerly extension of the First mentioned strip of land and along on an
existing road. The last mentioned strip of land is to terminate on an existing
County Road located near the Northwest Corner (NW Cor) of Government Lot Three
(3) in said Section 13.
EXCEPTING THEREFROM THAT PORTION CONVEYED TO ▇▇▇▇▇ BY QUITCLAIM DEED RECORDED
MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00661, OFFICIAL RECORDS.
A-2-1
PARCEL IV:
A LEASEHOLD ESTATE, AS CREATED BY THAT CERTAIN LEASE DATED OCTOBER 31, 1978 BY
PALMALL PROPERTIES, INC. A CALIFORNIA CORPORATION, ▇▇▇▇▇▇ ▇▇▇▇▇▇ AND ▇▇▇▇▇▇
▇▇▇▇▇ (AS SUCCESSOR IN INTEREST TO ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, DECEASED AND ▇.▇. ▇▇▇▇▇▇▇▇
AKA ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, DECEASED) AS ("LESSOR") AND PIONEER HOTEL INC. (AS
SUCCESSOR IN INTEREST TO COLORADO RIVER MOTEL AND CASINO, INC. AND COLORADO
RIVER RESORT HOTEL, INC. AND ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇) AS ("LESSEE"); TERM: 99 YEARS,
COMMENCING ON JANUARY 1, 1979 AND ENDING ON DECEMBER 31, 2078 IN AND TO THE
FOLLOWING:
That portion of Section 13, Township 32 South, Range 66 East, M.D.B.&M.,
described as follows:
COMMENCING at the Northwest Corner (NW Cor) of Government Lot Four (4) in said
Section 13; thence South 0(degree)01'14" West along the West line of said Lot
Four (4) a distance of 900.20 feet to a point; thence East parallel to the North
line of said Lot Four (4) a distance of 182.44 feet to a point; thence North
1(degree)41'09" East a distance of 220.10 feet to the TRUE POINT OF BEGINNING;
thence continuing North 1(degree)41'09" East a distance of 300.13 feet to a
point; thence East and parallel to the North line of said Lot Four (4) a
distance of 750.73 feet more or less to a point on the East line of said Lot
Four (4); thence Southerly along the said East line a distance of 305.87 feet
more or less to a point which bears East from the TRUE POINT OF BEGINNING;
thence West a distance of 700.00 feet more or less to the TRUE POINT OF
BEGINNING.
TOGETHER WITH a Right-of-Way and easement for road purposes with the right of
egress and ingress over and across a strip of land 60 feet in width lying
immediately West of and adjacent to the West line of the hereinabove described
parcel of land and over and across a strip of land 60 feet in width being the
Northerly extension of the first mentioned strip of land and along on an
existing road. The last mentioned strip of land is to terminate on an existing
County Road located near the Northwest Corner (NW Cor) of Government Lot Three
(3) in said Section 13.
EXCEPTING THEREFROM THAT PORTION CONVEYED TO ▇▇▇▇▇ COUNT BY QUITCLAIM DEED
RECORDED MARCH 12, 1990 IN BOOK 900312 AS DOCUMENT NO. 00560 AND RE-RECORDED
MARCH 14, 1990 IN BOOK 900314 AS DOCUMENT NO. 00615, OFFICIAL RECORDS.
▇-▇-▇
▇▇▇▇▇▇▇ ▇-▇
-----------
Description of Lone Mountain Property
-------------------------------------
The land referred to herein is situated in the State of Nevada, County of ▇▇▇▇▇,
described as follows:
PARCEL I:
THAT PORTION OF GOVERNMENT LOT FOUR (4) IN SECTION 2, TOWNSHIP 20 SOUTH, RANGE
60 EAST, M.D.B. & M., DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHWEST CORNER OF SAID LOT FOUR (4); THENCE SOUTH 89(degrees)
40' 36" EAST ALONG THE NORTH LINE OF SAID LOT 4, A DISTANCE OF 118.08 FEET TO A
POINT; THENCE SOUTH 36(degrees) 26' 00" EAST PARALLEL TO AND 330.00 FEET FROM
THE ▇▇▇▇ ▇▇▇▇ ▇▇ ▇.▇. ▇▇▇▇▇▇▇ ▇▇. ▇▇ (125 FEET WIDE), A DISTANCE OF 1824.85 FEET
TO A POINT ON THE SOUTH LINE OF SAID LOT 4; THENCE NORTH 83(degrees) 45' 26"
WEST ALONG THE SAID SOUTH LINE, A DISTANCE OF 1220.81 FEET TO THE SOUTHWEST
CORNER OF SAID LOT 4; THENCE NORTH 0(degree) 31' 52" EAST ALONG THE WEST LINE OF
SAID LOT 4; A DISTANCE OF 1348.50 FEET TO THE POINT OF BEGINNING.
EXCEPTING NORTH FIFTY (50) FEET OF SAID LAND AS CONVEYED TO THE COUNTY OF ▇▇▇▇▇
FOR STREET AND ROAD PURPOSES, BY DOCUMENT NO. 39297, RECORDED MARCH 15, 1955 OF
OFFICIAL RECORDS, ▇▇▇▇▇ COUNTY, NEVADA RECORDS.
PARCEL II:
TOGETHER WITH THAT PORTION OF THE NORTHWEST QUARTER (NW 1/4) OF SECTION 2,
TOWNSHIP 20 SOUTH, RANGE 60 EAST, M.D.B. & M., DESCRIBED AS FOLLOWS:
COMMENCING AT THE NORTHWEST CORNER OF SAID SECTION 2; THENCE SOUTH 83(degrees)
40' 36" EAST ALONG THE NORTH LINE OF SAID SECTION 2, A DISTANCE OF 567.50 FEET
TO A POINT ON THE ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇.▇. ▇▇▇▇▇▇▇ ▇▇. ▇▇; THENCE SOUTH
36(degrees) 26' 00" EAST ALONG THE LAST MENTIONED SOUTHWESTERLY LINE, A DISTANCE
OF 568.10 FEET TO THE TRUE POINT OF BEGINNING; THENCE CONTINUING SOUTH
36(degrees) 26' EAST, A DISTANCE OF 100 FEET TO A POINT; THENCE SOUTH
51(degrees) 34' 00" WEST, A DISTANCE OF 330.00 FEET TO A POINT; THENCE NORTH
36(degrees) 26' 00" WEST, A
A-3-1
DISTANCE OF 100.00 FEET TO A POINT; THENCE NORTH 53(degrees) 34' 00" EAST, A
DISTANCE OF 330.00 FEET TO THE TRUE POINT OF BEGINNING.
PARCEL III:
THAT PORTION OF THE NORTHWEST QUARTER (NW 1/4) OF SECTION 2, TOWNSHIP 20 SOUTH,
RANGE 60 EAST, M.D.B. & M., DESCRIBED AS FOLLOWS:
BEGINNING AT THE NORTHWEST CORNER OF SAID SECTION 2; THENCE SOUTH 83(degrees)
40' 36" EAST A DISTANCE OF 118.08 FEET TO A POINT; THENCE SOUTH 36(degrees) 26'
00" EAST A DISTANCE OF 972.77 FEET TO THE TRUE POINT OF BEGINNING; THENCE
CONTINUING SOUTH 36(degrees) 26' 00" EAST A DISTANCE OF 814 FEET; THENCE SOUTH
83(degrees) 40' 36" EAST A DISTANCE OF 40.83 FEET; THENCE NORTH 37(degrees) 26'
00" WEST A DISTANCE OF 838.48 FEET; THENCE SOUTH 53(degrees) 34' 00" WEST A
DISTANCE OF 30 FEET TO THE TRUE POINT OF BEGINNING.
SAID PARCEL BEING THE SAME PROPERTY CONVEYED IN DEED FROM R. ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇
COUNTY TREASURER, TO ▇▇▇▇▇▇▇ ▇. GAMBIER RECORDED APRIL 11, 1986 IN BOOK 860411
AS DOCUMENT NO. 00491, OFFICIAL RECORDS.
EXCEPTING THEREFROM THE ABOVE PARCEL, THAT PORTION CONVEYED TO THE CITY OF LAS
VEGAS BY DEED RECORDED APRIL 13, 1995 IN BOOK 950413, AS DOCUMENT NO. 00869,
OFFICIAL RECORDS.
A-3-2
EXHIBIT B
---------
Form of Deed
------------
B-1
EXHIBIT C
---------
Form of Assignment of Ground Lease
----------------------------------
C-1
EXHIBIT D
---------
Form of Net Lease
-----------------
To be attached
D-1
EXHIBIT E
---------
Form of Guaranty
----------------
To be attached
E-1
EXHIBIT F
---------
Form of Cash Collateral Agreement
---------------------------------
F-1
EXHIBIT G
---------
Form of Surveyor's Certificate
------------------------------
THE UNDERSIGNED LICENSED LAND SURVEYOR ("SURVEYOR") HEREBY STATES THAT (A) THIS
PLOT OF SURVEY AND THE PROPERTY DESCRIPTION SET FORTH HEREON ARE TRUE AND
CORRECT AND PREPARED FROM AN ACTUAL ON THE GROUND SURVEY OF THE REAL PROPERTY
("PROPERTY") SHOWN HEREON; (B) SUCH SURVEY WAS CONDUCTED BY THE SURVEYOR, OR
UNDER HIS SUPERVISION; (C) ALL MONUMENTS SHOWN HEREON ACTUALLY EXIST AND THE
LOCATION, SIZE AND TYPE OF MATERIAL THEREOF ARE CORRECTLY SHOWN; (D) EXCEPT AS
SHOWN HEREON, THERE ARE NO ENCROACHMENTS ONTO THE PROPERTY OR PROTRUSIONS
THEREFROM, THERE ARE NO VISIBLE EASEMENTS OR RIGHTS OF WAYS ON THE PROPERTY AND
THERE ARE NO VISIBLE DISCREPANCIES, CONFLICTS, SHORTAGES IN AREA OR BOUNDARY
LINE CONFLICTS, (E) THE SIZE, LOCATION AND TYPE OF IMPROVEMENTS ARE SHOWN
HEREON, AND ALL ARE LOCATED WITHIN THE BOUNDARIES OF THE PROPERTY EXCEPT AS
SHOWN AND SET BACK FROM THE PROPERTY LINES THE DISTANCES INDICATED; (F) THE
PROPERTY HAS ACCESS TO AND FROM A PUBLIC ROADWAY; (G) ALL KNOWN RECORDED
EASEMENTS HAVE BEEN CORRECTLY PLOTTED HEREON; (H) THE BOUNDARIES, DIMENSIONS AND
OTHER DETAILS SHOWN HEREON ARE TRUE AND CORRECT; (I) THE PROPERTY SHOWN HEREON
IS/IS NOT LOCATED WITHIN FLOOD ZONE ____. FLOOD ZONE ____ IS DEFINED AS "AREAS
OF 100-YEAR SHALLOW FLOODING WHERE DEPTHS ARE BETWEEN ONE (1) AND THREE (3)
FEET; AVERAGE DEPTHS OF INUNDATION ARE SHOWN, BUT NO FLOOD HAZARD FACTORS ARE
DETERMINED," ON U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT FIRM (FLOOD
INSURANCE RATE MAP), COMMUNITY PANEL NO. ------- ____, MAP REVISED ____; THE
SURVEYOR HAS REVIEWED THE LEGAL DESCRIPTION OF THE ADJACENT PROPERTIES AND NO
CONFLICT EXISTS WITH THE COMMON BOUNDARY LINES.
THE SURVEYOR EXPRESSLY UNDERSTANDS AND AGREES THAT (A) THE STATEMENT IS MADE TO
INDUCE HAHF PIONEER, LLC ("TRANSFEREE") TO ACQUIRE THE PROPERTY AND TO INDUCE
▇▇▇▇▇▇▇ TITLE INSURANCE COMPANY ("TITLE COMPANY") TO ISSUE A POLICY OF TITLE
INSURANCE ON THE PROPERTY; (B) TRANSFEREE AND TITLE COMPANY ARE ENTITLED TO RELY
ON THIS PLAT OF SURVEY AS BEING TRUE AND ACCURATE; AND (C) THE CONSIDERATION
PAID TO THE SURVEYOR FOR THE PREPARATION AND VERIFICATION OF SUCH SURVEY HAS
BEEN PAID, IN PART, FOR THE BENEFIT OF TRANSFEREE AND TITLE COMPANY AND IN
ANTICIPATION OF THEIR RELIANCE HEREON.
G-1
EXHIBIT H
---------
Third Party Leases
------------------
1. The Ground Lease.
2. The Gaming Lease.
H-1
EXHIBIT I
---------
Service Contracts
-----------------
PIONEER HOTEL & GAMBLING HALL
CONTRACT LISTING
(Assumable)
------------------------------------------------------------------------------------------------------------------------------------
Vendor Contract Contract Copy of
Name # Date Expires Dept. Comments Contract
------------------------------------------------------------------------------------------------------------------------------------
Arch Paging Survl.
------------------------------------------------------------------------------------------------------------------------------------
Arizona State Land Dept. Permit 23-10037 8/16/1998 ###### G&A Land Use Permit and Yes
Lease for Fuel Dock.
------------------------------------------------------------------------------------------------------------------------------------
ASCAP 01/01/2000 ###### G&A Awaiting copy of No
license agreement
for 2000.
------------------------------------------------------------------------------------------------------------------------------------
Atlas Match Corp. 11/09/1999 ###### G&A Fixed Price Yes
Purchase Commitment
for Logo Matches
------------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇. Arcade Expired Expired G&A Contract Expired. Yes
operation Operating month by
month.
------------------------------------------------------------------------------------------------------------------------------------
Baron Pest Control 08/12/1997 Monthly F&B Pest inspection and Yes
control.
------------------------------------------------------------------------------------------------------------------------------------
BHD Information Systems 02/01/1996 N/A MIS Software license Yes
for Retail Pro.
Gift shop
accounting, POS.
------------------------------------------------------------------------------------------------------------------------------------
BMI 01/01/2000 ###### G&A Awaiting copy of No
license agreement
for 2000.
------------------------------------------------------------------------------------------------------------------------------------
Cardiff Consulting Group International 03/27/1996 N/A HR Training Materials
License Agreement
------------------------------------------------------------------------------------------------------------------------------------
Cerberus Pyrotronics 20962 03/13/1998 ###### Sec. Life Safety System
Service Agreement
------------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇ Cablevision Monthly Hotel Cable television No
provider, contract
expired.
------------------------------------------------------------------------------------------------------------------------------------
Colorado River Internet Monthly MIS Internet service provider No
------------------------------------------------------------------------------------------------------------------------------------
DecisionOne 147280 08/15/1997 ?? G&A Monitor maintenance
agreement
------------------------------------------------------------------------------------------------------------------------------------
Desert Lakes Golf Course T11182000-216 08/01/2000 ###### G&A Tournament 11/18/00. Yes
------------------------------------------------------------------------------------------------------------------------------------
Desert Recreation 06/15/2000 ###### G&A Waverunner Rental and Yes
Fuel Dock Usage
------------------------------------------------------------------------------------------------------------------------------------
Emerald River Golf Course T11192000-880 03/10/2000 ###### G&A Tournament 11/19/00. Yes
------------------------------------------------------------------------------------------------------------------------------------
Emerald River Golf Course T02042001-914 03/20/2000 ###### G&A Tournament 02/04/01. Yes
------------------------------------------------------------------------------------------------------------------------------------
Emerald River Golf Course T11182001-945 03/20/2000 ###### G&A Tournament 11/18/01. Yes
------------------------------------------------------------------------------------------------------------------------------------
Firemaster Eng. Fire Alarm System
------------------------------------------------------------------------------------------------------------------------------------
Ford Motor Credit 10/01/1997 ###### G&A Used 1997 Ford Van Yes
(48 months)
------------------------------------------------------------------------------------------------------------------------------------
Galaxy Communications Inc. 06/21/1999 ###### PBX Pay Phones. Yes
------------------------------------------------------------------------------------------------------------------------------------
Global Cash Access 03/12/1999 ###### Cage Quasi cash advance Yes
services (ATM and
Credit card)
------------------------------------------------------------------------------------------------------------------------------------
GST Call-America (formerly Frontier Comm) 10/07/1998 ###### PBX Hotel phone service Yes
------------------------------------------------------------------------------------------------------------------------------------
Highway Stations, The Mktg. Radio advertising sports
------------------------------------------------------------------------------------------------------------------------------------
I-1
-----------------------------------------------------------------------------------------------------------------------------------
Hospitality Network Expired Monthly Hotel In-room movies. Yes
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇, ▇▇▇▇▇▇ ▇. G&A Ground Lease
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇ Business Machines 07/22/2000 ###### Mktg. Round Up Embosser Yes
-----------------------------------------------------------------------------------------------------------------------------------
London Bridge Jet Tours Expired Monthly G&A Dock Use Agreement Yes
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇, Fargo & Co. 05/01/2000 ###### Cage Armored car service. Yes
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇ Media 02/04/1998 ###### Mktg. Outdoor Bulletin Yes
Contract. Barstow CA.
-----------------------------------------------------------------------------------------------------------------------------------
Microbilt 06/24/1996 Expired Cage Equipment Rent for Yes
Cage Services
-----------------------------------------------------------------------------------------------------------------------------------
Micros Systems Inc. MSA-128282 F&B Maintenance Service
Agreement - Upgrade
in process
-----------------------------------------------------------------------------------------------------------------------------------
Mission Industries 07/09/1999 ###### F&B Linens Yes
-----------------------------------------------------------------------------------------------------------------------------------
NEC Business Network Solutions Waiting for update PBX Phone system See Prior
maintenance
agreement
-----------------------------------------------------------------------------------------------------------------------------------
Nevada, State of 04/20/1994 ###### G&A Floating dock permit Yes
-----------------------------------------------------------------------------------------------------------------------------------
Pall Mall Properties 07/01/1998 ###### G&A Ground Lease
-----------------------------------------------------------------------------------------------------------------------------------
Pepsi-Cola Company 08/01/1996 ###### F&B Soft drink agreement Yes
-----------------------------------------------------------------------------------------------------------------------------------
Pitney ▇▇▇▇▇ G&A Mailing
machine/scale
maintenance
-----------------------------------------------------------------------------------------------------------------------------------
Pitney ▇▇▇▇▇ 12/17/1996 ####### G&A Copier Yes
lease/maintenance
and usage agreement
-----------------------------------------------------------------------------------------------------------------------------------
Prime Cable ######## ###### G&A DMX music service Yes
-----------------------------------------------------------------------------------------------------------------------------------
R&E Storage Various Various Various Various storage N/A
rental contracts,
prepaid annually.
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇ Trust G&A Ground Lease
-----------------------------------------------------------------------------------------------------------------------------------
Silver State Disposal 08/31/1998 ###### Eng. 36-yard Compactor Yes
Lease
-----------------------------------------------------------------------------------------------------------------------------------
Silver State Disposal 08/31/1998 ###### Eng. 26-yard Compactor Yes
Lease
-----------------------------------------------------------------------------------------------------------------------------------
Simplex Time Recorder 07/01/1999 ###### Cage Time stamp
maintenance.
Prepaid annually
-----------------------------------------------------------------------------------------------------------------------------------
Statewide Fire Protection Eng. Fire Sprinkler
System
-----------------------------------------------------------------------------------------------------------------------------------
Stericycle, Inc. (formerly BFI Waste Mgt.) 10/31/1995 Monthly Prtrs Medical waste Yes
disposal
-----------------------------------------------------------------------------------------------------------------------------------
T.J. Wholesale 04/30/1998 Monthly Pit Agreement to Yes
package used
playing cards.
-----------------------------------------------------------------------------------------------------------------------------------
Thyssen Elevator Corp. 10/01/1998 ###### Eng. Elevator Service Yes
($250 per mo.)
-----------------------------------------------------------------------------------------------------------------------------------
Transworld Systems Inc. 09/18/1999 ###### Cage Collections System. Yes
-----------------------------------------------------------------------------------------------------------------------------------
Tru-Measur Liquor System F&B Liquor gun
maintenance
-----------------------------------------------------------------------------------------------------------------------------------
Western Money Systems 3714 04/21/2000 ###### Cage Glory currency Yes
counters
maintenance
agreement
-----------------------------------------------------------------------------------------------------------------------------------
XpertX Service, Inc. 03/01/2000 ###### Keno Equipment and Yes
Software Maintenance
-----------------------------------------------------------------------------------------------------------------------------------
Yesco 04/01/2000 ###### Eng. Sign electrical Yes
maintenance
agreement
-----------------------------------------------------------------------------------------------------------------------------------
Yesco L25048C 05/01/1998 ###### Mktg. Outdoor billboard Yes
advertising -
Cal-Nev-Ari
-----------------------------------------------------------------------------------------------------------------------------------
Yesco Mktg. Outdoor billboard
advertising
-----------------------------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
Yesco Mktg. Outdoor billboard advertising
-----------------------------------------------------------------------------------------------------------------------------------
Yesco Mktg. Outdoor billboard advertising
-----------------------------------------------------------------------------------------------------------------------------------
PIONEER HOTEL & GAMBLING HALL
CONTRACT LISTING
(Unassumable)
===================================================================================================================================
Vendor Contract Contract Copy of
Name # Date Expires Dept. Comments Contract
$
===================================================================================================================================
Anchor Games 08/12/1996 Monthly Slots Multi-Game Agreement
-----------------------------------------------------------------------------------------------------------------------------------
Casinovations (formerly Gaming 2000) 07/01/1998 Monthly Pit Bonus Blackjack Lease/License Yes
Agreement.
-----------------------------------------------------------------------------------------------------------------------------------
Central Credit Cage Credit checking services in Cage,
software agreement
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Corp. Cage Jetscan maintenance contract -
serial #7489
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Corp. Slots Jetsort maintenance contract -
serial #2216/2647
-----------------------------------------------------------------------------------------------------------------------------------
▇▇▇▇▇▇▇-▇▇▇▇▇▇▇ Corp. 217780 08/04/2000 ###### Slots Jetsort maintenance contract - Yes
serial #1702, 1703, 2118
-----------------------------------------------------------------------------------------------------------------------------------
IGT Monthly Slots (5) $1 Wheel of Fortune Yes
-----------------------------------------------------------------------------------------------------------------------------------
IGT Monthly Slots (6) 25c Wheel of Fortune
-----------------------------------------------------------------------------------------------------------------------------------
IGT Monthly Slots (10) ▇▇▇▇▇▇▇ Deluxe Yes
-----------------------------------------------------------------------------------------------------------------------------------
IGT Action Gaming Monthly Slots (6) 25c Triple Play @ $5 per day
-----------------------------------------------------------------------------------------------------------------------------------
Nevada Council on Problem Gambling Waiting for Update HR License Agreement on Problem
Gambling Materials
-----------------------------------------------------------------------------------------------------------------------------------
No Peek 21 07/03/1998 Monthly Pit Rental of "No Peek" blackjack Yes
devices
-----------------------------------------------------------------------------------------------------------------------------------
PDS Financial Corp. SO# 980138 10/26/1998 ###### G&A Installment purchase. 12 IGT slant Yes
tops.
-----------------------------------------------------------------------------------------------------------------------------------
Shuffle Master 10/03/1994 Monthly Pit 3 Card Poker License Agreement Yes
-----------------------------------------------------------------------------------------------------------------------------------
Shuffle Master 09/15/1994 Monthly Pit Let It Ride License Agreement Yes
-----------------------------------------------------------------------------------------------------------------------------------
Shuffle Master 10/13/1997 Monthly Pit Shuffler rental Yes
-----------------------------------------------------------------------------------------------------------------------------------
US Playing Card Co. Pit Agreement for 28,000 decks of cards.
-----------------------------------------------------------------------------------------------------------------------------------
WMS Gaming 03/05/1999 Monthly Slots Participation agreement on Monopoly Yes
-----------------------------------------------------------------------------------------------------------------------------------
WMS Gaming 09/01/2000 12 Mos Slots Installment purchase. 10 Upright Yes
Video
-----------------------------------------------------------------------------------------------------------------------------------
I-3
EXHIBIT J
---------
HAZARDOUS SUBSTANCES
--------------------
Those Hazardous Substances used in the ordinary course of business in
compliance with all laws and disclosed in the Environmental Report.
J-1
EXHIBIT K
---------
Form of Non-Foreign Certificate
-------------------------------
To inform HAHF Pioneer, LLC, a Delaware limited liability company
("Transferee"), that withholding of tax under Section 1445 of the Internal
Revenue Code of 1954, as amended ("Code"), will not be required upon transfer of
certain real property to Transferee by PIONEER LLC, a Nevada limited liability
company ("Transferor"), the undersigned hereby certifies the following on behalf
of Transferor:
1. Transferor is not a foreign person, foreign corporation, foreign
partnership, foreign trust, or foreign estate (as those terms are defined in the
Code and the Income Tax Regulations promulgated thereunder);
2. Transferor's U.S. employer identification/social security number is as
follows: __________
3. Transferor's office address is: ▇▇▇▇ ▇▇▇▇▇ ▇▇., ▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇▇.
Transferor understands that this Certification may be disclosed
to the Internal Revenue Service by Transferee and that any false statement
contained herein could be punished by fine, imprisonment, or both.
Transferor understands that Transferee is relying on this
Certification in determining whether withholding is required upon said transfer.
Transferor hereby agrees to indemnify, protect, defend (using
counsel selected by Transferee) and hold Transferee harmless from and against
any and all obligations, liabilities, claims, losses, actions, causes of action,
rights, demands, damages, costs and expenses of every kind, nature or character
whatsoever (including, without limitation, actual attorneys' and paralegals'
fees and court costs) incurred by Transferee as a result of: (i) Transferor's
failure to pay U.S. Federal income tax which the Transferor is required to pay
under applicable U.S. law arising in connection with the subject transaction; or
(ii) any false or misleading statement contained herein.
K-1
Under penalty of perjury I declare that I have examined this
Certification and to the best of my knowledge and belief it is true, correct and
complete, and I further declare that I have authority to sign this document on
behalf of Transferor.
Dated: December 29, 2000
PIONEER LLC,
a Nevada limited liability company
By:___________________
Its:________________
K-2
EXHIBIT L
---------
Articles of Incorporation of HAHF
---------------------------------
[See attached]
L-1
EXHIBIT M
---------
Form of Assignment of Intangible Property
-----------------------------------------
THIS ASSIGNMENT OF INTANGIBLE PROPERTY is executed as of this 29th day
of December, 2000, by PIONEER LLC, a Nevada limited liability company
("Transferor"), in favor of HAHF PIONEER, LLC, a Delaware limited liability
company ("Transferee").
FOR VALUE RECEIVED, Transferor hereby grants, conveys, transfers and
assigns to Transferee all of Transferor's right, title and interest in, to and
under the Intangible Property (as defined in the Exchange Agreement of even date
herewith (the "Exchange Agreement") among Transferor, Pioneer Hotel Inc.
("Tenant"), ▇▇▇▇▇▇ Affordable Housing of Florida, Inc. and Transferee).
Notwithstanding anything contained herein to the contrary, (a) the Intangible
Property being assigned pursuant to this Assignment of Intangible Property
shall, to the extent constituting Service Contracts (as defined in the Exchange
Agreement), continue to be performed by Tenant pursuant to the terms of the Net
Lease (as defined in the Exchange Agreement), with no obligations thereunder
assumed by Transferee and no privity of contract with Transferee created by this
Assignment or otherwise and (b) Transferee hereby licenses the Intangible
Property to Transferor and Tenant for so long as the Net Lease is in effect in
consideration for the rental and other sums payable by Tenant under the Net
Lease.
Transferor hereby covenants that it will, at any time and from time to
time upon written request therefor, execute and deliver to Transferee, its
nominees, successors and/or assigns, any new or confirmatory instruments and do
and perform any other acts which Transferee, its nominees, successors and/or
assigns, may reasonably request in order to fully assign and transfer to and
vest in Transferee, its nominees, successors and/or assigns, and protect its
and/or their rights, title and interest in and enjoyment of, all of the
Intangible Property, or to enable Transferee, its nominees, successors and/or
assigns, to realize upon or otherwise enjoy the same.
Transferor hereby agrees to indemnify, defend, protect and hold
harmless Transferee from and against any and all liability, loss, cost, damage
and expense (including, without limitation, reasonable attorneys' and
paralegals' fees and costs) relating to Transferor's and Tenant's obligations
with respect to the Intangible Property arising prior to the date hereof.
The provisions of this Assignment of Intangible Property shall be
binding upon and inure to the benefit of Transferor, Transferee and their
successors and assigns.
M-1
IN WITNESS WHEREOF, the undersigned have executed this Assignment of
Intangible Property as of the date first above written.
"TRANSFEROR"
PIONEER LLC,
a Nevada limited liability company
By: __________________________________
Its: _____________________________
"TRANSFEREE"
HAHF PIONEER, LLC,
a Delaware limited liability company
By: __________________________________
Its: _____________________________
M-2
EXHIBIT N
---------
FORM OF ▇▇▇▇ OF SALE
--------------------
▇▇▇▇ OF SALE
------------
KNOW ALL MEN BY THESE PRESENTS, that whereas, by deed of even
date herewith, PIONEER LLC, a Nevada limited liability company ("Grantor"), did
grant and convey unto HAHF PIONEER, LLC, a Delaware limited liability company
("Grantee"), all of Grantor's interest in that certain tract of land with
improvements thereon, known as Pioneer Hotel and Casino, Laughlin, Nevada, as
more fully described therein (the "Property");
NOW, THEREFORE, in consideration of the sum of Ten ($10.00)
Dollars, and other good and valuable consideration to Grantor in hand paid by
Grantee, the receipt, adequacy and sufficiency of which is hereby acknowledged,
Grantor has BARGAINED, SOLD, ASSIGNED, TRANSFERRED AND DELIVERED, and by these
presents does hereby BARGAIN, SELL, ASSIGN, TRANSFER AND DELIVER, unto Grantee
absolutely and not as security, the "Personal Property (as such term is
hereinafter defined) and Grantor binds itself and its and its heirs, personal
representatives, partners, successors and assigns to WARRANT AND FOREVER DEFEND
the title to the Personal Property against the claim or claims of all persons
whomsoever claiming by, through or under Grantor, but not otherwise.
"Personal Property" shall mean all of Grantor's right, title and
interest in all tangible personal property upon the Property or used in
connection with the improvements thereon, including, without limitation, all
Personal Property (as defined in the Exchange Agreement of even date herewith
among Grantor, grantee, Pioneer Hotel Inc. and ▇▇▇▇▇▇ Affordable Housing of
Florida, Inc.), appliances, fixtures, furniture, furnishings, tools, machines,
apparatus, equipment, supplies, decorations, any owned or leased vehicles,
inventory, computers and software and other items of personal property used in
connection with the Property but specifically excluding (i) the Gaming Equipment
(as defined in the Exchange Agreement dated as of the date hereof) and (ii) all
personal property of hotel guests.
Grantor further agrees as follows:
1. Representations and Warranties of Grantor. Grantor represents
------------------------------------------
and warrants to Grantee that: (a) Grantor has not assigned or granted a security
interest in any of the Personal Property to anyone; and (b) Grantor's interests
in the Personal Property are not subject to any lien, encumbrance, claim, set-
off or deduction.
2. Additional instruments. Grantor agrees that it will, upon
-----------------------
request from Grantee, at any time from time to time after the date hereof
and without further consideration, do, execute, acknowledge and deliver or cause
to be done, executed, acknowledged and delivered all such further acts,
assignments, transfers, conveyances and assurances deemed by Grantee, its
successors and assigns, to be necessary or proper to better effect the sale,
assignment, transfer, conveyance and delivery of ownership of the Personal
Property to Grantee.
N-1
3. Successors. This ▇▇▇▇ of Sale shall inure to the benefit of
-----------
Grantee and be binding upon Grantor, and each of their respective heirs, legal
representatives, successors and assigns.
IN WITNESS WHEREOF, Grantor has executed this ▇▇▇▇ of Sale as of
this 29th day of December, 2000.
PIONEER LLC,
a Nevada limited liability company
By: ________________________________
Name: __________________________
Title:__________________________
N-2
EXHIBIT O
---------
Title Confirmation
------------------
[to be attached]
EXHIBIT P
---------
Intellectual Property
---------------------
[to be attached]
P-1
EXHIBIT Q
---------
Form of Memorandum of Lease
---------------------------
RECORDING REQUESTED BY AND
WHEN RECORDED MAIL TO:
▇▇▇▇▇ ▇. ▇'▇▇▇▇, Esq.
Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
_______________________________
NOTICE OF LEASE
---------------
NOTICE is hereby given, pursuant to Nevada Revised Statutes Section
247.120 that effective as of December 29, 2000, HAHF PIONEER, LLC ("Landlord"),
and PIONEER HOTEL INC. ("Tenant"), have entered into a Lease described as
follows:
1. Landlord leases to Tenant, and Tenant leases from Landlord, the real
property located in the County of ▇▇▇▇▇, State of Nevada, described in Exhibit
-------
"A" attached hereto (the "Property").
---
2. This Memorandum of Lease is subject to the terms, conditions and provisions
of that certain Net Lease (the "Lease") between Landlord and Tenant dated
December 29, 2000, which is incorporated herein by reference as though set out
here in full. The Lease shall control in the event of any conflict with this
Memorandum of Lease.
3. The initial term of the Lease is twenty (20) years. The Lease term shall
commence on December 29, 2000. The initial term of the Lease may be extended by
Tenant in accordance with the terms of the Lease for up to two (2) additional
periods of five (5) years each.
4. The lease contains an option in favor of Tenant to purchase the Property
and all improvements thereon.
5. Landlord and Tenant acknowledge that they are executing this Memorandum of
Lease on a date which is prior to the commencement of the Lease term for
purposes of facilitating its recording.
Q-1
IN WITNESS WHEREOF, the parties have executed this Memorandum of Lease
effective as of the date first above written.
"LANDLORD"
HAHF PIONEER, LLC, a Delaware limited liability
company
By: ▇▇▇▇▇▇ Affordable Housing of Florida, Inc., a
Florida corporation, its sole member
By_________________________________
Its: ____________________________
"TENANT"
PIONEER HOTEL INC., a Nevada corporation
By:________________________________
Its: ____________________________
Q-2
NEVADA ACKNOWLEDGEMENT
----------------------
STATE OF NEVADA
COUNTY OF ▇▇▇▇▇
This instrument was acknowledged before me on December _____, 2000, by
_______________________________ as _______________________________ of
_______________________________.
Notary Public
My appointment expires:
Q-1
EXHIBIT R
---------
Deliveries by Transferor
------------------------
(1) One (1) original of the Deed and the Assignment of
Ground Lease, duly executed by Transferor and in recordable form.
(2) Four (4) counterparts of the Memorandum of Lease, duly
executed by Transferor and in recordable form.
(3) Four (4) counterparts of the Net Lease, duly executed
by Transferor.
(4) Four (4) counterparts of the Guaranty, duly executed by
Guarantor.
(5) Four (4) originals of the Assignment of Intangible
Property, duly executed by Transferor.
(6) Four (4) originals of the ▇▇▇▇ of Sale, duly executed
by Transferor.
(7) Four (4) originals of the LM Deed of Trust, duly
executed by SFHI and in recordable form.
(8) Four (4) originals of the Non-Foreign Certificate, duly
executed by Transferor.
(9) The Holdback Escrow Amount. Within 30 days after
Closing, four (4) originals of the Collateral Account Agreement(s), duly
executed by Transferor, together with executed UCC-1 financing statements
necessary to perfect Transferee's security interest in each Account and an
opinion of Transferor's counsel as to the perfection of such account.
(10) The original of Transferor's Counsel Opinion, duly
executed by Transferor's counsel.
(11) A certificate from the Office of the Nevada Secretary
of State dated within twenty (20) days of the Closing Date indicating that, as
of the date of such certificate, there are no filings against Transferor or
Tenant in said Office of the Nevada Secretary of State which would be a lien on
any of the Personal Property.
(12) Copies of any Third Party Leases.
(13) Originals or copies of all Service Contracts and any
warranties or guaranties received by Transferor and to be assigned to
Transferee, from
R-1
any contractors, subcontractors, suppliers or materialmen in connection with any
construction, repairs or alterations of the Improvements or any tenant
improvements.
(14) Originals or copies of all certificates of occupancy in
Transferor's possession or control (or the equivalent issued or available in the
jurisdiction in which the Improvements are located) for the Improvements with
respect to the Property, or in the event a certificate of occupancy (or its
equivalent) is not issued or available in the jurisdiction in which some or all
of such Improvements are located, (i) Transferor's certification to Transferee
of the unavailability thereof, and (ii) a letter from the local jurisdiction or
Transferor's counsel stating that the use of the Property is a "conforming use"
and, with respect to the Property, a certified zoning map.
(15) One complete set of all existing as-built plans and
specifications for the Improvements to the extent in the possession or under the
control of Transferor.
(16) Originals or copies of all licenses, permits,
entitlements or approvals, if any, held by Transferor, and/or to be assigned to
Transferee pursuant to this Agreement, in connection with the ownership, lease
or occupation of the Property.
(17) Such resolutions, authorizations, bylaws or other
corporate documents or agreements relating to Transferor as shall be reasonably
required by Transferee in connection with this transaction.
(18) A copy of all existing UCC-1 financing statements filed
in connection with the Property.
(19) Original insurance certificates and legible copies of
original insurance policies required pursuant to Section 7.2 of the Net Lease.
-----------
(20) Any other data, records, documents or agreements called
for in the Agreement to be delivered by Transferor which have not previously
been delivered.
R-2
EXHIBIT S
---------
Deliveries by Transferee
------------------------
(1) Four (4) counterparts of the Net Lease, duly executed
by Transferee.
(2) Four (4) counterparts of the Memorandum of Lease, duly
executed by Transferee.
(3) Four (4) counterparts of the Assignment of Intangible
Property, duly executed by Transferee.
(4) Limited liability authority documents required by the
Title Company.
(5) The cash portion of the Exchange Price, as adjusted
pursuant to the Agreement.
(6) A stock power assigning the certificate evidencing the
Preferred Stock from Transferee and a replacement certificate evidencing the
Preferred Stock in Transferor's name.
(7) Within 30 days following Closing, four (4) counterparts
of the Cash Collateral Agreement.
(8) Any other documents or agreements called for in the
Agreement to be delivered by Transferee which have not previously been
delivered.
(9) Amended and Restated Articles of Incorporation of HAHF,
including amendment establishing the Preferred Stock, certified by the Florida
Secretary of State.
(10) Bylaws of HAHF, certified by the Secretary of HAHF.
S-1
EXHIBIT T
---------
FORM OF GROUND LESSOR CONSENT AND ESTOPPEL
------------------------------------------
T-1
EXHIBIT U
---------
LITIGATION
Santa Fe Gaming Corporation v. U.S. District Court Case No.
▇▇▇▇▇▇ Bay Partners and ▇▇▇▇▇ District of Nevada CV-S-99-00298-JBR(LRL)
Lesser
▇▇▇▇▇ ▇. Sahara Hotel ▇▇▇▇▇ County District Case No.
Court A333233
Progressive Games v. Arizona U.S. District Court Case Nos.
Charlies et al. District of Nevada CV-N-98-00503 ECR
▇▇-▇-▇▇-▇▇▇▇▇-▇▇▇
▇▇▇▇▇▇/▇▇▇▇▇▇▇▇ v. Caesars et al. U.S. District Court Case No.
District of Nevada CV-S-94-1126-▇▇▇
▇▇▇▇▇▇ v. Hacienda ▇▇▇▇▇ County Case No.
A317576
Hotel Employees and Restaurant U.S. District Court Case No.
Employees International Union District of Nevada ▇▇-▇-▇▇-▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇ Fund et al. v. Santa Fe
Gaming Corporation et al.
Disabled Rights Action Committee U.S. District Court Case No.
and ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ v. Santa Fe District of Nevada CV-S-00-0806 RLH
Gaming Corporation
▇▇▇▇ ▇▇▇▇▇▇ v. Pioneer Hotel, Inc. U.S. District Court Case No.
Northern Nevada 97-00399 -ON APPEAL
▇▇▇▇▇ ▇▇▇▇▇▇ v. Santa Fe Gaming ▇▇▇▇▇ County District Case No.
Corp. Court 96-A-363355-C
▇▇▇▇▇ ▇▇▇▇ v. Pioneer Hotel, Inc., ▇▇▇▇▇ County District Case No.
Pioneer Hotel & Casino Court 95-A-343741-C
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ v. Santa ▇▇ ▇▇▇▇▇ County District Case No.
Gaming Corp. Court ▇▇-▇-▇▇▇▇▇▇-▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇ v. Santa Fe Gaming ▇▇▇▇▇ County District Case No.
Corp. Court 99-A-409790-C
Santa Fe Gaming Corp. v. State of ▇▇▇▇▇ County District Case No.
Nevada Court 98-A-389694-J
U-1
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ v. Santa Fe Hotel ▇▇▇▇▇ County District Case No.
& Casino Court 00-A-413204-M
Santa Fe Hotel Inc. v. ▇▇▇▇▇▇ ▇▇▇▇▇ County District Case No.
▇▇▇▇▇▇▇ Court 99-A-412232-C
▇▇▇ ▇▇▇▇▇▇ v. Santa Fe Hotel Inc. ▇▇▇▇▇ County District Case No.
Court 99-A-408041-C
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ v. Santa Fe Hotel & ▇▇▇▇▇ County District Case No.
Casino Court 99-A-406463-J
Santa Fe Hotel, Inc. adv. ▇▇▇▇ ▇▇▇▇▇ County District Case No.
▇▇▇▇▇▇ Court A401844
Santa Fe Hotel, Inc. adv. ▇▇▇▇▇ County District Case No.
▇▇▇▇ ▇▇▇▇▇▇▇ Court A382868
Pioneer Hotel & Gambling Hall, Inc. ▇▇▇▇▇ County District Case No.
adv. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ Court A387992
Santa Fe Hotel, Inc. adv. ▇▇▇▇▇ County District Case No.
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Court A391267
▇▇▇▇▇▇▇ ▇▇▇▇▇ v. Santa Fe Hotel, Inc. ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇.
▇▇▇▇▇ ▇▇-▇-▇▇▇▇▇▇-▇
▇▇▇▇▇ Seingar v. Santa Fe Hotel & ▇▇▇▇▇ County District Case ▇▇.
▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇-▇-▇▇▇▇▇▇-▇
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ v. Santa Fe Hotel & ▇▇▇▇▇ County District 96-A-358037-C
Casino Court
Santa Fe Hotel, Inc. adv. ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ County District Case No.
▇▇▇▇▇▇, by and through ▇▇▇▇▇ ▇▇▇▇▇▇ Court A420732
and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
parents/guardians of ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
U-1
TABLE OF CONTENTS
-----------------
Page
----
ARTICLE I TRANSFER...................................................... 1
1.1 Transfer...................................................... 1
1.2 Certain Definitions........................................... 2
1.3 Leaseback..................................................... 3
1.4 Guaranty of Lease; Cash Collateral Account; Lone Mountain..... 3
ARTICLE II EXCHANGE PRICE/EXCHANGE CONSIDERATION......................... 3
2.1 Exchange Price/Exchange Consideration......................... 3
ARTICLE III TITLE TO REAL PROPERTY AND DUE DILIGENCE...................... 4
3.1 Title......................................................... 4
3.2 Due Diligence Items........................................... 6
ARTICLE IV RESERVED...................................................... 6
ARTICLE V CONDITIONS TO CLOSING......................................... 6
5.1 Title......................................................... 6
5.2 Environmental................................................. 6
5.3 Legal Compliance.............................................. 7
5.4 Financial Condition........................................... 7
5.5 Representations and Warranties................................ 7
5.6 Non-Foreign Status of Transferor.............................. 7
5.7 Transferor's Opinion of Counsel............................... 7
5.8 Cash Collateral............................................... 8
5.9 Approval of Appraisal......................................... 8
5.10 Deliveries by Transferor...................................... 8
5.11 UCC Financing Statements...................................... 8
5.12 Committee Approval............................................ 8
5.13 Ground Lessor Estoppel........................................ 8
5.14 Union Contracts............................................... 8
ARTICLE VI CLOSING AND RECORDING......................................... 9
6.1 Closing and Closing Date...................................... 10
6.2 Early Deposit of Documents.................................... 10
6.3 Deliveries by Transferor...................................... 11
-i-
Page
----
6.4 Deliveries by Transferee...................................... 11
6.5 Other Instruments............................................. 11
6.6 Prorations.................................................... 11
6.7 Costs and Expenses............................................ 11
6.8 Settlement Statement.......................................... 11
ARTICLE VII REPRESENTATIONS AND WARRANTIES OF TRANSFEROR/TENANT........... 12
7.1 Condition of Property......................................... 12
7.2 Use and Operation............................................. 12
7.3 Utilities..................................................... 12
7.4 Use Permits and Other Approvals............................... 12
7.5 Authority of Transferor....................................... 12
7.6 Zoning and Environmental...................................... 13
7.7 Employees..................................................... 14
7.8 Asbestos...................................................... 14
7.9 Leases........................................................ 14
7.10 Service Contracts............................................. 14
7.11 Litigation.................................................... 15
7.12 Other Contracts to Convey Property............................ 15
7.13 Conflicts..................................................... 15
7.14 Full Disclosure............................................... 15
7.15 Intellectual Property......................................... 16
7.16 Intercompany Debt............................................. 16
7.17 Investment Representations.................................... 16
7.18 No Other Property............................................. 17
7.19 Limitation of Transferor's/Tenant's Representations and
Warranties.................................................... 17
ARTICLE VIII REPRESENTATIONS AND WARRANTIES OF TRANSFEREE AND HAHF......... 18
-ii-
Page
----
8.1 Representations and Warranties of Transferee and HAHF......... 18
8.2 Limitation of Transferee's and HAHF's Representations and
Warranties.................................................... 18
8.3 COVENANT OF HAHF.............................................. 18
ARTICLE IX Miscellaneous................................................. 19
9.1 Notices....................................................... 19
9.2 Brokers and Finders........................................... 19
9.3 Successors and Assigns........................................ 20
9.4 Amendments.................................................... 20
9.5 Continuation and Survival of Indemnities, Representations and
Warranties.................................................... 20
9.6 Interpretation................................................ 20
9.7 Governing Law................................................. 20
9.8 Merger of Prior Agreements.................................... 21
9.9 Attorneys' Fees............................................... 21
9.10 Relationship.................................................. 21
9.11 Authority..................................................... 21
9.12 Counterparts.................................................. 21
9.13 Exhibits...................................................... 21
9.14 Access; Confidentiality....................................... 22
-iii-
LIST OF EXHIBITS
Section Reference
-----------------
A-1 Description of the Owned Land 1.1(a)
A-2 Description of the Ground Leased Land 1.1(a)
A-3 Description of Lone Mountain Property 1.4
B Form of Deed 1.1(a)
C Form of Assignment of Ground Lease 1.1(a)
D Form of Net Lease 1.3
E Form of Guaranty 1.4
F Form of Cash Collateral Agreement 1.4
G Form of Surveyor's Certificate 3.1(b)
H Third Party Leases 3.2(i)
I Service Contracts 3.2(ii)
J Hazardous Substances 7.6(b)
K Form of Non-Foreign Certificate 5.6
L Articles of Incorporation of HAHF 2.1
M Form of Assignment of Intangible Property 1.1(c)
N Form of ▇▇▇▇ of Sale 1.1(d)
O Title Confirmation 6.1(c)
P Intellectual Property 7.15
Q Form of Memorandum of Lease 6.2(b)
R Deliveries by Transferor 6.3
S Deliveries by Transferee 6.4
T Form of Ground Lessor Consent and Estoppel 5.13
U Litigation 7.11
LIST OF DEFINED TERMS
Term Section Defined
---- ---------------
Account 1.4
Act 5.7
ADA 5.3
Agreement Caption
Assignment of Ground Lease 1.1(a)
Assignment of Intangible Property 1.1(c)
Assumed Indebtedness 1.4
▇▇▇▇ of Sale 1.1(d)
Transferee Caption
Transferee's Closing Documents Article V.B.
Cash Collateral Agreement 1.4
Closing 6.1
Closing Date 6.1
Company Financial Statements 8.8
Deed 1.1(a)
Due Diligence Materials 3.2
Environmental Condition 7.6(b)
Environmental Laws 7.6(c)
Environmental Report 7.6(b)
ERISA 7.7
Exchange Price 2.1(a)
Gaming Equipment 1.1
Gaming Lease 1.1
Ground Lease 1.2
Ground Leased Land 1.1(a)
Ground Lessor Estoppel 5.13
Guarantor 1.4
Guaranty 1.4
Improvements 1.1(b)
Intangible Property 1.1(c)
Intellectual Property 7.15
Intercompany Indebtedness 1.4
Intercompany Lender 2.1
Land 1.1(a)
Laws 5.3
LM Deed of Trust 1.4
Lone Mountain Property 1.4
Lone Mountain Title Policy 3.1(f)
Net Lease 1.3
Non-Foreign Certificate 5.6
Owned Land 1.1(a)
Permitted Exceptions 3.1(d)
Personal Property 1.1(d)
Plans and Specifications 3.2(iv)
Preferred Stock 2.1
Property 1.2(a)
Real Property 1.2(a)
Recorded Documents 6.3
Retained Intercompany Indebtedness 1.4
Securities Act 7.17(b)
Transferor Caption
Transferor's Closing Documents 5.7
Transferor's Counsel Opinion 5.7
Service Contracts 3.2(ii)
SFGC 1.4
SFHI 1.4
Surviving Obligations 5.15
Survey 3.1(b)
Third Party Leases 3.2(i)
Title Commitment 3.1(a)
Title Company 3.1(a)
Title Condition 6.1(c)