EXHIBIT 2
VOTING AND CONTRIBUTION AGREEMENT
BY
AND
AMONG
PH CASINO RESORTS, INC.
AND
THE STOCKHOLDERS SIGNATORY HERETO
DATED AS OF APRIL 17, 2000
VOTING AND CONTRIBUTION AGREEMENT
VOTING AND CONTRIBUTION AGREEMENT (this "Agreement"), dated
as of April 17, 2000, by and among PH Casino Resorts, Inc., a Delaware
corporation (together with its assignees or designees,"PHCR"), and the
other signatories hereto (together with any Additional Stockholders, the
"Stockholders").
W I T N E S S E T H
WHEREAS, concurrently with the execution and delivery of this
Agreement, Pinnacle Entertainment, Inc., a Delaware corporation
("Pinnacle") is entering into an agreement and plan of merger, dated as of
the date hereof (the "Merger Agreement"), with Pinnacle Acquisition
Corporation, a Delaware corporation ("Pinnacle Acq Corp"), pursuant to
which Pinnacle Acq Corp shall merge with and into Pinnacle (the "Merger"),
upon the terms and conditions set forth therein;
WHEREAS, each Stockholder severally desires that the Pinnacle
Acq Corp and Pinnacle enter into the Merger Agreement;
WHEREAS, concurrently with the execution and delivery of this
Agreement, Harveys Casino Resorts, a Nevada corporation ("Harveys") is
entering into an agreement and plan of merger, dated as of the date hereof
(the "Harveys Merger Agreement"), with Harveys Acquisition Corporation, a
Nevada corporation ("Harveys Acq Corp"), pursuant to which Harveys Acq Corp
shall merge with and into Harveys (the "Harveys Merger") upon the terms and
conditions set forth therein;
WHEREAS, each Stockholder severally desires that Harveys and
Harveys Acq Corp enter into the Harveys Merger Agreement;
WHEREAS, concurrently with the execution and delivery of this
Agreement, PHCR and the Stockholders are entering into a Memorandum of
Understanding (the "MOU"), which sets forth certain principal terms with
respect to incentive equity and other employment matters related to the
Merger and the Harveys Merger;
WHEREAS, the Stockholders own beneficially and of record and
have the sole power to vote and dispose of the number of shares of common
stock, par value $.10 per share, of Pinnacle ("Pinnacle Common Stock") set
forth under the caption "Shares Owned," opposite their respective names on
Schedule I hereto (such shares of Pinnacle Common Stock owned by the
Stockholders or acquired or otherwise received after the date hereof being
the "Shares");
WHEREAS, opposite each Stockholder's name on Schedule II
under the caption "Options Owned" is (i) the number of shares of Pinnacle
Common Stock acquirable pursuant to employee stock options owned by the
Stockholders (the "Options") and (ii) the exercise price of each such
Option (the "Exercise Price");
WHEREAS, each Stockholder severally desires to contribute its
shares of Pinnacle Common Stock to PHCR as part of a transaction that,
together with the Merger and the Harveys Merger, is intended to qualify as
exchanges under section 351 of the Internal Revenue Code of 1986, as
amended;
WHEREAS, as a condition to its willingness to enter into the
Merger Agreement, PHCR has requested that the Stockholders enter into this
Agreement; and
WHEREAS, from time to time prior to the consummation of the
Merger, additional Stockholders may be joined as signatories to this
Agreement either in substitution of or in addition to, the Stockholders, in
each case subject to the terms and conditions herein described.
NOW, THEREFORE, in consideration of the foregoing premises
and the representations, warranties and agreements contained herein, and
for other good and valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto, intending to be legally
bound, agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain capitalized terms used and not
otherwise defined herein have the meanings ascribed to them in the Merger
Agreement. Unless the context otherwise requires, such terms shall include
the singular and plural and the conjunctive and disjunctive forms of the
terms defined.
ARTICLE II
VOTING AGREEMENTS
SECTION 2.01. Stockholder Meetings. Each Stockholder agrees
that at any meeting of stockholders of Pinnacle called to vote upon the
Merger or the Merger Agreement, or at any adjournment thereof, or in any
other circumstances upon which a vote, consent or other approval of the
stockholders of Pinnacle with respect to the Merger, the Merger Agreement
or any of the other transactions contemplated thereby or hereby is sought,
such Stockholder shall cause its Shares to be present for quorum purposes
and to vote (or caused to be voted) its Shares in favor of the terms
thereof and each of the other transactions contemplated by the Transaction
and this Agreement and any actions required in furtherance thereof and
hereof. Each Stockholder hereby grants to PHCR a proxy to vote all of the
Shares then beneficially owned by such Stockholder as indicated in this
Section 2.01. Each Stockholder agrees that this proxy shall be irrevocable
and coupled with an interest, agrees to take such further action or execute
such other instruments as may be necessary to effectuate the intent of this
proxy and hereby revokes any proxy previously granted by such Stockholder
with respect to any of the Shares.
SECTION 2.02. Competing Transaction. Subject to the
provisions of Article VI, each Stockholder agrees that at any meeting of
stockholders of Pinnacle, or at any adjournment thereof, or in any other
circumstances upon which their vote, consent or other approval is sought,
such Stockholder shall vote (or cause to be voted) its Shares against (i)
any Takeover Proposal and (ii) any amendment of Pinnacle's Certificate of
Incorporation or Bylaws or other proposal or transaction involving Pinnacle
or any of its subsidiaries which amendment or other proposal or transaction
would in any manner impede, interfere with, materially delay, frustrate,
prevent or nullify or result in a breach of any covenant, representation or
warranty or any other obligation or agreement of Pinnacle or any
Stockholder under or with respect to, the Merger, the Merger Agreement or
any of the other transactions contemplated by the Merger Agreement or by
this Agreement.
ARTICLE III
CONTRIBUTION
SECTION 3.01. Contribution of Shares by Stockholders. Each
Stockholder agrees that immediately prior to the effective time of the
Merger (the "Effective Time"), each such Stockholder shall contribute the
number of Shares listed opposite such Stockholder's name under the caption
"Shares Contributed" on Schedule I hereto (and, to the extent that the
Options Exchanged (as defined below) are exercised prior to the Effective
Time, each such Stockholder also shall contribute such Shares received upon
such exercise), to PHCR. PHCR shall issue to each contributing Stockholder,
a number of shares of PHCR's Class A Common Stock, par value $.01 per share
(the "PHCR Class A Common Stock"), equal to the product of (A) the Merger
Consideration, (B) divided by 45.77707, (C) multiplied by .009901 (the
foregoing calculation, the "Class A Conversion Ratio"), and a number of
shares of PHCR's Class B Common Stock, par value $.01 per share (the "PHCR
Class B Common Stock" and, together with the PHCR Class A Common Stock, the
"PHCR Common Stock"), equal to the product of (A) the Merger Consideration,
(B) divided by 45.77707, (C) multiplied by .990099 (the foregoing
calculation, the "Class B Conversion Ratio"), for each Share contributed.
SECTION 3.02. Termination of Options by Stockholders. Each
Stockholder agrees that immediately prior to the Effective time, the
Options listed opposite such Stockholder's name under the caption "Options
Exchanged" on Schedule I hereto shall be cancelled, except to the extent
that the Options Exchanged are exercised prior to the Effective Time, in
which case such Stockholder also shall contribute to PHCR in accordance
with Section 3.01 the Shares received upon such exercise. In connection
with such cancellation, PHCR shall issue to such Stockholder one or more
fully vested options to acquire (i) a number of shares of PHCR Class A
Common Stock equal to the number of shares of Pinnacle Common Stock
issuable upon exercise of such Options, multiplied by the Class A
Conversion Ratio, and (ii) a number of shares of PHCR Class B Common Stock
equal to the number of shares of Pinnacle Common Stock issuable upon
exercise of such Options, multiplied by the Class B Conversion Ratio, in
each case subject to the restrictions set forth in an option agreement to
be entered into between the parties. With respect to each Stockholder, the
exercise price of each option issued to purchase PHCR Common Stock shall be
set at an amount so that the aggregate value of all such options will, as
of the Effective Time, be equal to (i) the product of (a) the cash amount
of the Pinnacle Merger Consideration multiplied by (b) the aggregate number
of Shares which may be acquired upon exercise of the Options contributed by
such Stockholder, minus (ii) the aggregate Exercise Price of such Options.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the
Stockholders. Each of the Stockholders severally and not jointly represents
and warrants to Pinnacle Acq Corp as follows:
(a) Power, Organization and Standing. Such Stockholder
has all requisite power and authority to enter into and perform its
obligations under this Agreement and, if such Stockholder is not a
natural person, such Stockholder is duly organized, validly existing
and in good standing under the laws of its state of organization.
(b) Authority and Capacity. The execution and delivery
of this Agreement, and the performance by such Stockholder of its
obligations hereunder, have been duly authorized by all necessary
action on the part of such Stockholder. This Agreement has been duly
executed and delivered by such Stockholder and, assuming the due
execution and delivery hereof by PHCR and assuming that approval of
this Agreement by Pinnacle remains effective, this Agreement
constitutes a legal, valid and binding obligation of such
Stockholder, enforceable against such Stockholder in accordance with
its terms.
(c) Ownership. Such Stockholder is the record and
beneficial owner of, and has good and valid title to, the number of
Shares and Options listed opposite such Stockholder's name under the
captions "Shares Owned" and "Options Owned," respectively on
Schedule I hereto, free and clear of all Liens or other adverse
interests (including any restrictions on the right to vote, sell or
otherwise dispose of such Shares and Options). Except for this
Agreement, there are no outstanding warrants, subscriptions, rights
(including preemptive rights), options, calls, commitments or other
agreements or Liens or other adverse interests to encumber, purchase
or acquire any of the Shares or Options of such Stockholder or
securities convertible into or exchangeable for the Shares of such
Stockholder. Except as indicated in Schedule I, neither such
Stockholder nor any of its affiliates or associates (as such terms
are defined in Rule 12b-2 promulgated under the Exchange Act) holds
either of record or beneficially any securities, capital stock,
warrants, subscriptions, rights (including preemptive rights),
options, calls, commitments or other instruments of Pinnacle or any
of Pinnacle's direct or indirect subsidiaries other than such
Stockholder's Shares. Such Stockholder has the exclusive power to
vote such Shares.
(d) No Conflict. The execution of this Agreement and
the consummation of the transactions contemplated hereby will not
require notice to, or the consent of, any party to any contract to
which such Stockholder is a party or by which it is bound, or the
consent, approval, order or authorization of, or the registration,
declaration or filing with, any governmental authority, except for
those (i) required under the HSR Act, if any; (ii) required by any
Gaming Authority; and (iii) pertaining to approval by the Pinnacle
Board of Directors (which the Stockholders represent has been
granted). Assuming that the notices, consents and approvals referred
to in the preceding sentence have been given, made or obtained and
remain effective, the execution, delivery and performance by such
Stockholder of this Agreement and the consummation of the
transactions contemplated hereby will not (i) violate any Laws, (ii)
result in a breach or violation of any provision of, constitute a
default under, or result in the termination of, or an acceleration
of indebtedness or creation of any Lien under, any contract to which
such Stockholder is a party or by which it is bound or (iii)
conflict with or violate any provision of the organizational or
similar documents of such Stockholder.
(e) Brokers, Finders, etc. No broker, investment
banker, financial advisor, finder or other person (other than fees
and expenses of which are the responsibility of PHCR or Pinnacle Acq
Corp) is entitled to any broker's, finder's, financial advisor's or
other similar fee or commission in connection with the transactions
contemplated by this Agreement based upon arrangements made by or on
behalf of the Stockholders.
(f) Investment Representations. Each Stockholder:
(i) is an "Accredited Investor," as
such term is defined in Regulation D under the Securities Act of
1933, as amended (the "Securities Act");
(ii) has had access to such financial
and other information, and has been afforded the opportunity to ask
questions of representatives of PHCR, and to receive answers to
those questions, as it has deemed necessary in connection with its
acquisition of PHCR Common Stock;
(iii) acknowledges that the shares of
PHCR Common Stock that will be acquired pursuant to this Agreement
are being acquired in a transaction not involving any public
offering within the meaning of the Securities Act, and the shares of
PHCR Common Stock, have not been, and may never be, registered under
the Securities Act;
(iv) agrees not to offer, sell,
transfer or otherwise dispose of the PHCR Common Stock in the
absence of registration under the Securities Act unless it delivers
to PHCR an opinion of counsel reasonably satisfactory to PHCR, in
form and substance satisfactory to PHCR, to the effect that the
proposed sale, transfer or other disposition may be effected without
registration under the Securities Act and under applicable state
securities and blue sky laws;
(v) acknowledges that unless and until
such PHCR Common Stock shall have been registered under the
Securities Act, the certificates will bear a legend to the following
effect:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE
SECURITIES LAWS OF ANY STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF SUCH REGISTRATION, UNLESS THE TRANSFEROR
DELIVERS TO THE COMPANY AN OPINION OF COUNSEL OR OTHER EVIDENCE REASONABLY
SATISFACTORY TO THE COMPANY, IN FORM AND SUBSTANCE SATISFACTORY TO THE
COMPANY, TO THE EFFECT THAT THE PROPOSED SALE, TRANSFER OR OTHER
DISPOSITION MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE SECURITIES ACT
AND UNDER APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS.
(vi) has such knowledge and experience
in financial and business matters that it is capable of evaluating
the merits and risks of an acquisition of the PHCR Common Stock and
is able to bear the economic risk of a loss of an investment in the
PHCR Common Stock and is not acquiring any PHCR Common Stock with a
view to the distribution thereof or any present intention of
offering or selling any thereof in a transaction that would violate
the Securities Act or the securities laws of any state or any other
applicable jurisdiction; and
(vii) has been advised by its own
counsel with respect to this Agreement and the tax implications of
the contributions and transactions contemplated hereby.
(g) Stockholders Agreement. Such Stockholder has
reviewed the provisions of the Stockholders Agreement, dated as of
February 2, 1999 by and among Harveys, Colony HCR Voteco LLC, a
Delaware limited liability company, Colony Investors III, L.P., a
Delaware limited partnership and the persons listed on Schedule A
thereto (the "Colony Stockholders Agreement"), and acknowledge that
such Stockholder shall enter into an agreement with substantially
similar terms (except as may be specified in the MOU) on the Closing
Date, by and among PHCR and the stockholders of PHCR named therein
(the "Stockholders Agreement") and such Stockholder acknowledges
that the PHCR Common Stock to be issued to such Stockholder pursuant
to Article III hereof shall be subject to the Stockholders
Agreement.
SECTION 4.02. Representations and Warranties of PHCR. PHCR
hereby represents and warrants to each of the Stockholders as follows:
(a) Organization, Standing and Power. PHCR is duly
organized, validly existing and in good standing under the laws of
its state of incorporation, and has all requisite power and
authority to enter into and perform its obligations under this
Agreement.
(b) Capitalization. The authorized capital stock of
PHCR consists of 20,000,000 shares of PHCR Class A Common Stock,
20,000,000 shares of PHCR Class B Common Stock and 1,000,000 shares
of preferred stock, par value $.01 per share ("PHCR Preferred
Stock"). As of the date hereof, 1,000 shares of PHCR Class A Common
Stock are issued and outstanding and no shares of PHCR Preferred
Stock are issued and outstanding. Immediately following the
Effective Time, the authorized capital stock of PHCR shall consist
of 20,000,000 shares of PHCR Class A Common Stock, 20,000,000 shares
of PHCR Class B Common Stock and 1,000,000 shares of PHCR Preferred
Stock. Assuming Pinnacle Merger Consideration of $24 per share in
cash, immediately following the Effective Time, 105,388 shares of
PHCR Class A Common Stock, 10,538,798 shares of PHCR Class B Common
Stock and no shares of PHCR Preferred Stock shall be issued and
outstanding; and 11,399 shares of PHCR Class A Common Stock and
1,139,875 shares of PHCR Class B Common Stock shall be reserved for
issuance upon exercise of outstanding employee stock options;
provided, that such numbers do not include any shares of PHCR Class
A Common Stock or PHCR Class B Common Stock which may be issued to
holders of Harveys' preferred stock in lieu of accrued but unpaid
dividends; provided further that such numbers shall be adjusted to
take into account any adjustment in the Pinnacle Merger
Consideration pursuant to Section 10.11 of the Merger Agreement.
(c) Authority and Capacity. The execution and delivery
of this Agreement, and the performance by PHCR of its obligations
hereunder, have been duly authorized by all necessary action on the
part of PHCR. This Agreement has been duly executed and delivered on
behalf of PHCR and, assuming the due execution and delivery hereof
by the Stockholders and assuming that approval of this Agreement by
Pinnacle remains effective, this Agreement constitutes a legal,
valid and binding obligation of PHCR, enforceable against PHCR in
accordance with its terms.
(d) No Conflict. The execution of this Agreement and
the consummation of the transactions contemplated hereby will not
require notice to, or the consent of, any party to any contract to
which PHCR or any of its affiliates is a party or by which any of
them is bound, or the consent, approval, order or authorization of,
or the registration, declaration or filing with, any governmental
authority, except for (i) those required under the HSR Act, if any,
(ii) approvals, as necessary, by any Gaming Authority, (iii)
approval by the Pinnacle Board of Directors (which the Stockholders
represent has been granted); and (iv) as set forth on Schedule
3.02(c). Assuming that the notices, consents and approvals referred
to in the preceding sentence have been given, made or obtained and
remain effective, the execution, delivery and performance by PHCR of
this Agreement and the consummation of the transactions contemplated
hereby will not (i) violate any Laws, (ii) result in a breach or
violation of any provision of, or constitute a default under, any
contract to which PHCR is a party or by which it is bound or (iii)
conflict with any provision of the certificate of incorporation or
bylaws of PHCR.
ARTICLE V
COVENANTS
SECTION 5.01. No Solicitation. Each Stockholder agrees that
it shall not, nor shall it authorize or permit any Affiliate, agent,
partner or employee of, or any investment banker, attorney or other advisor
or representative of, such Stockholder to, directly or indirectly, (i)
solicit or initiate, or encourage any inquiries regarding or the submission
of, any Takeover Proposal (including without limitation any proposal or
offer to Pinnacle's stockholders) or (ii) participate in any discussions or
negotiations regarding, or furnish to any person any nonpublic information
with respect to, or take any other action to facilitate the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
Takeover Proposal. Notwithstanding the foregoing, a Stockholder may (A)
furnish nonpublic information with respect to Pinnacle to the person who
made such Takeover Proposal and (B) participate in negotiations with such
person regarding such Takeover Proposal, if such Stockholder is instructed
in writing to do so by the Board of Directors of Pinnacle; provided that it
is understood that this Section 5.01 shall not be deemed to have been
violated if in response to an unsolicited inquiry, such Stockholder states
solely that he or she is subject to the limits of this Agreement and
provides only public information in response to such unsolicited inquiry.
SECTION 5.02. No Transfer; No Inconsistent Arrangements. Each
Stockholder agrees that it shall not (including by way of any gift, sale,
pledge or other disposition, including without limitation in connection
with foreclosures by lenders secured by pledges of Shares or Options) (i)
transfer, sell or pledge, encumber, assign or otherwise dispose of, or
consent to the transfer or pledge of, any or all of the Shares or Options
owned by it or of any interest therein, (ii) enter into any contract,
option or other agreement or understanding with respect to any such
transfer of any such Shares or Options, or any interest therein or result
in the imposition of any Lien, (iii) grant any proxy, power-of-attorney or
other authorization in or with respect to any such Shares or Options, (iv)
deposit any such Shares or Options into a voting trust or enter into a
voting agreement or arrangement with respect to any such Shares or Options
or (v) take any action that would in any way restrict, limit or interfere
or in any way be inconsistent with the performance of its obligations
hereunder or the transactions contemplated hereby or by the Merger
Agreement.
SECTION 5.03. Further Assurances. From time to time, whether
before, at, or after the Closing, each party hereto agrees to execute and
deliver, or cause to be executed and delivered, such additional
instruments, certificates and other documents, and to take such other
action, as may be necessary or advisable in order to carry out the terms
and provisions of this Agreement and the transactions contemplated hereby
(including voting the Shares in favor of any such transaction) or to cause
the elimination of any circumstance that would cause a condition under
Article V hereof not to be satisfied on the Closing Date.
SECTION 5.04. Expenses. All fees and expenses incurred in
connection with this Agreement and the transactions contemplated hereby
(other than fees and expenses incurred in connection with obtaining
necessary gaming licenses which shall be paid by Pinnacle) shall be paid by
the party incurring such fees or expenses, whether or not the Merger is
consummated.
SECTION 5.05. Publicity. Each Stockholder and PHCR agree
that, prior to the Closing, no public release or announcement concerning
this Agreement shall be issued by any such party without the prior written
consent (which consent shall not be unreasonably withheld) of the other
parties hereto, except as such release or announcement may be required by
law (in which event the other parties hereto shall have the right to
comment promptly on the form and content of the disclosure).
SECTION 5.06. Notice of Certain Events. PHCR and each
Stockholder agrees to notify each other party hereto promptly of (a) any
event or condition that, with or without notice or lapse of time, would or
could reasonably be expected to cause any of the representations and
warranties made by such party herein to be no longer complete and accurate
as of any date on or before the Closing Date, or (b) any failure, with or
without notice or lapse of time, on the part of such party to comply with
any of the covenants or agreements on its part contained herein at any time
on or before the Closing Date.
SECTION 5.07. ▇.▇. ▇▇▇▇▇▇▇ Approval Right. From the date
hereof until the Effective Time or earlier termination of this Agreement,
▇.▇. ▇▇▇▇▇▇▇ shall have the right to reasonably approve any equity
investment in, or material acquisition by, Holding, Pinnacle Acq Corp,
Harveys or any of their respective subsidiaries; provided that ▇▇. ▇▇▇▇▇▇▇
shall consider any request to take such actions in good faith and such
approval shall not be unreasonably withheld.
SECTION 5.08. Sale of ▇▇▇▇▇▇▇ Shares. Immediately prior to
the Effective Time, ▇▇. ▇▇▇▇▇▇▇ shall sell to Pinnacle, and Pinnacle shall
purchase from ▇▇. ▇▇▇▇▇▇▇, the shares of Pinnacle Common Stock owned by ▇▇.
▇▇▇▇▇▇▇ on the date hereof that are not Shares Contributed (the "▇▇▇▇▇▇▇
Shares") for a price equal to the Pinnacle Merger Consideration (including
a contingent payment right on terms substantially identical to that being
received by Pinnacle's stockholders under Section 10.11 of the Merger
Agreement), if any, that would be payable at the Effective Time in respect
of the ▇▇▇▇▇▇▇ Shares. ▇▇. ▇▇▇▇▇▇▇ shall use commercially reasonable
efforts to obtain a comparable economic and tax position with respect to
the sale of the ▇▇▇▇▇▇▇ Shares if, for any reason, PHCR does not redeem the
▇▇▇▇▇▇▇ Shares. In connection with implementing its financing, PHCR and
Pinnacle Acq Corp shall use their commercially reasonable efforts to secure
elimination of covenants in Indentures governing Pinnacle's public debt and
waivers from its banks under the Bank Credit Facility which would prohibit
or limit Pinnacle's ability to effectuate the purchase of the ▇▇▇▇▇▇▇
Shares as contemplated herein.
ARTICLE VI
CONDITIONS PRECEDENT TO
OBLIGATIONS UNDER ARTICLE III
SECTION 6.01. Stockholders' Conditions. The obligation of
each of the Stockholders pursuant to Article III shall be subject to the
satisfaction or waiver on the Closing Date of each of the following
conditions precedent:
(a) No Injunctions or Restraints. No temporary
restraining order or preliminary or permanent injunction of any
court or administrative agency of competent jurisdiction prohibiting
the transactions contemplated by this Agreement shall be in effect.
(b) No Violation of Law. The performance of the
obligations of each of the Stockholders pursuant to Article III
shall not constitute a violation of any Laws.
(c) Representations and Warranties. The
representations and warranties of PHCR set forth in this Agreement
shall be true and correct in all material respects on and as of the
Closing Date an as of the date hereof, as though made on and as of
the Closing Date.
(d) Covenants and Agreements. PHCR shall have
performed, in all material respects, all obligations and complied,
in all material respects, with all covenants required by this
Agreement to be performed or complied with it at or prior to the
Closing Date.
(e) Merger Agreement. Each of the conditions to
closing contained in the Merger Agreement (other than the
consummation of the transactions contemplated by this Agreement)
shall have been satisfied or waived.
(f) Certificates for PHCR Common Stock. PHCR shall
have delivered to each Stockholder certificates representing shares
of PHCR Common Stock, free and clear of all Liens or other adverse
interests (including any restriction on the right to vote, sell or
otherwise dispose of the PHCR Common Stock).
(g) Stockholders Agreement. PHCR shall have executed
and delivered the Stockholders Agreement to the Stockholders.
(h) Purchase of ▇▇▇▇▇▇▇ Shares. The ▇▇▇▇▇▇▇ Shares
shall have been redeemed by Pinnacle for an amount equal to the
Pinnacle Merger Consideration (including a contingent payment right
on terms substantively identical to that being received by
Pinnacle's stockholders under Section 10.11 of the Merger Agreement)
so that after such redemption his percentage ownership interest in
Pinnacle, including any ownership arising from the exercise of stock
options held by him and any other shares the ownership of which is
attributed to him under section 318 of the Internal Revenue Code of
1986, as amended, is less than 80% of such percentage ownership
interest prior to such redemption, or, in his good faith
determination, ▇▇. ▇▇▇▇▇▇▇ shall have obtained a comparable economic
and tax position with respect to the sale of the ▇▇▇▇▇▇▇ Shares.
SECTION 6.02. PHCR's Conditions. The obligation of PHCR
pursuant to Article III shall be subject to the satisfaction or waiver on
the Closing Date of each of the following conditions precedent:
(a) No Injunctions or Restraints. No temporary
restraining order or preliminary or permanent injunction of any
court or administrative agency of competent jurisdiction prohibiting
the transactions contemplated by this Agreement shall be in effect.
(b) No Violation of Law. The performance of the
obligations of PHCR pursuant to Article III shall not constitute a
violation of any Laws.
(c) Representations and Warranties. The
representations and warranties of the Stockholders set forth in this
Agreement shall be true and correct in all material respects on and
as of the Closing Date, as though made on and as of the Closing
Date.
(d) Covenants and Agreements. Each of the Stockholders
shall have performed, in all material respects, all obligations and
complied, in all material respects, with all covenants required by
this Agreement to be performed or complied with it at or prior to
the Closing Date.
(e) Merger Agreement. Each of the conditions to
closing contained in the Merger Agreement (other than the
consummation of the transactions contemplated by this Agreement)
shall have been satisfied or waived.
(f) Certificates for Shares. Each Stockholder shall
have delivered to PHCR certificates representing its Shares with all
necessary indorsements, free and clear of all Liens or other adverse
interests (including any restriction on the right to vote, sell or
otherwise dispose of such Shares).
(g) Stockholders Agreement. Each Stockholder shall
have executed and delivered the Stockholders Agreement to PHCR.
ARTICLE VII
TERMINATION, AMENDMENT AND INDEMNIFICATION
SECTION 7.01. Termination. This Agreement shall terminate
without any further action on the part of PHCR or any of the Stockholders
(i) if the Closing has occurred, (ii) if the Merger has been consummated in
accordance with the terms of the Merger Agreement, or (iii) if the Merger
Agreement has been terminated in accordance with Article 9 thereunder.
SECTION 7.02. Effect of Termination. In the event this
Agreement shall have been terminated in accordance with Section 7.01 of
this Agreement, this Agreement shall forthwith become void and have no
effect, without any liability or obligation on the part of any party
hereto, except to the extent that such termination results from the wilful
and material breach by a party of any of its representations, warranties,
covenants or agreements set forth in this Agreement, in which case each
other party shall be entitled to recover all damages allowable at law and
all relief available in equity, subject, however, to the limitation in
Section 9.2 of the Merger Agreement.
SECTION 7.03. Amendment. This Agreement and the Schedules and
Exhibits hereto may not be amended except by an instrument or instruments
in writing signed and delivered on behalf of each of the parties hereto. At
any time prior to the Closing Date, any party hereto which is entitled to
the benefits hereof may (a) extend the time for the performance of any of
the obligations or other acts of any other party, (b) waive any inaccuracy
in the representations and warranties of any other party contained herein,
in any Schedule and Exhibit hereto, or in any document delivered pursuant
hereto, and (c), subject to applicable law, waive compliance with any of
the agreements of any other party hereto or any conditions contained
herein. Any agreement on the part of any of the parties hereto to any such
extension or waiver (i) shall be valid only if set forth in an instrument
in writing signed and delivered on behalf of each such party, and (ii)
shall not be construed as a waiver or extension of any subsequent breach or
time for performance hereunder.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.01. Notices. All notices, requests, claims, demands
and other communications under this Agreement shall be in writing and shall
be deemed given if delivered personally or sent by overnight courier
(providing proof of delivery) to the parties at the following addresses (or
at such other address for a party as shall be specified by like notice):
(a) if to PHCR, to:
with a copy to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: 213-687-5600
(b) if to the Stockholders, to the addresses set forth
on the books and records of Pinnacle.
SECTION 8.02. Interpretation. When a reference is made in
this Agreement to an Article, Section or Schedule, such reference shall be
to an Article, Section or Schedule of this Agreement, unless otherwise
indicated. The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation
of this Agreement. Whenever the words "include," "includes" or "including"
are used in this Agreement, they shall be deemed to be followed by the
words "without limitation." The Merger Agreement and the consummation of
the transactions contemplated by such Merger Agreement are transactions
contemplated by this Agreement. To the extent any restriction on the
activities of Pinnacle or its subsidiaries under the terms of this
Agreement requires prior approval under any Gaming Law, such restriction
shall be of no force or effect unless and until such approval is obtained.
If any provision of this Agreement is illegal or unenforceable under any
Gaming Law, such provision shall be void and of no force or effect.
SECTION 8.03. Severability. If any provision of this
Agreement or the application of any such provision shall be held invalid,
illegal or unenforceable in any respect by a court of competent
jurisdiction, such invalidity, illegality or unenforceability shall not
affect any other provision hereof. In lieu of any such invalid, illegal or
unenforceable provision, the parties hereto intend that there shall be
added as part of this Agreement a valid, legal and enforceable provision as
similar in terms to such invalid, illegal or unenforceable provision as may
be possible or practicable under the circumstances.
SECTION 8.04. Counterparts. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have
been signed by each of the parties and delivered to the other parties.
SECTION 8.05. Entire Agreement; No Third-Party Beneficiaries.
This Agreement, the MOU, the Merger Agreement, and the Schedules and
Exhibits thereto, constitute the entire agreements, and supersede all prior
agreements and understandings, both written and oral, among the parties
with respect to the subject matter of these agreements and neither this
Agreement nor the Merger Agreement, is intended to confer upon any person
other than the parties any rights or remedies thereunder.
SECTION 8.06. Governing Law. THIS AGREEMENT SHALL BE GOVERNED
BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE,
WITHOUT REGARD TO ANY APPLICABLE CONFLICTS OF LAW AND EXCEPT THAT GAMING
LAWS SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
RESPECTIVE JURISDICTIONS IN WHICH APPROVALS FROM GAMING AUTHORITIES ARE
REQUIRED TO BE OBTAINED.
SECTION 8.07. Gaming Laws. Each of the provisions of this
Agreement is subject to and shall be enforced in compliance with the Gaming
Laws.
SECTION 8.08. Assignment. Neither this Agreement nor any of
the rights, interests or obligations under this Agreement shall be
assigned, in whole or in part, by operation of law or otherwise by any of
the parties without the prior written consent of the other parties, except
that PHCR may assign, in its sole discretion and without any Stockholder's
consent, any of or all its rights, interests and obligations under this
Agreement to any controlled affiliate of Colony Capital, Inc., but no such
assignment shall relieve PHCR of any of its obligations under this
Agreement. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of, and be enforceable by, the parties
and their respective successors and assigns.
SECTION 8.09. Enforcement. The parties agree that irreparable
damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or
were otherwise breached. It is accordingly agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this
Agreement in any court of the United States located in the State of
Delaware or in any Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition,
each of the parties hereto (a) consents to submit itself to the personal
jurisdiction of any Federal court located in the State of Delaware or any
Delaware state court in the event any dispute arises out of this Agreement
or any of the transactions contemplated by this Agreement, (b) agrees that
it will not attempt to deny or defeat such personal jurisdiction by motion
or other request for leave from any such court and (c) agrees that it will
not bring any action relating to this Agreement or any of the transactions
contemplated by this Agreement in any court other than a Federal or state
court sitting in the State of Delaware.
SECTION 8.10. Stockholder Capacity. Notwithstanding anything
herein to the contrary, the Stockholders enter into this Agreement solely
in their respective capacities as stockholders of Pinnacle. No person
executing this Agreement who is or becomes a director or officer of
Pinnacle shall be deemed to make any agreement herein in his or her
capacity as director or officer of Pinnacle. Nothing herein shall limit or
affect (a) actions taken by any Stockholder in his or her capacity as
director or officer of Pinnacle or (b) the rights and remedies PHCR may
have other than pursuant to this Agreement in respect of such conduct
undertaken in the capacity of director or officer of Pinnacle.
[signature pages follow]
IN WITNESS WHEREOF, each of the parties hereto has caused its
duly authorized officers to execute this Voting and Contribution Agreement
as of the date first above written.
PH CASINO RESORTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
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Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
STOCKHOLDERS
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