Exhibit 10.2
EXECUTION COPY
THE MAJESTIC STAR CASINO, LLC
MAJESTIC STAR CASINO CAPITAL CORP. II
$200,000,000 9 3/4% SENIOR NOTES DUE 2011
PURCHASE AGREEMENT
December 16, 2005
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Each of The Majestic Star Casino, LLC, an Indiana limited liability
company (the "Company"), Majestic Star Casino Capital Corp. II, an Indiana
corporation ("Capital II" and, together with the Company, the "Issuers"), and
each Subsidiary Guarantor (as defined herein) hereby agrees with you as follows:
1. Issuance of Securities. The Issuers propose to issue and sell to
▇▇▇▇▇▇▇▇▇ & Company, Inc. (the "Initial Purchaser"), and the Initial Purchaser
proposes to purchase, $200,000,000 aggregate principal amount of the Issuers' 9
3/4% Senior Notes due 2011 (the "Series A Notes"). The Series A Notes will be
issued pursuant to an indenture to be executed as of the Closing Date (as
defined herein) (the "Indenture"), among the Issuers, the Subsidiary Guarantors
(as defined herein), and The Bank of New York Trust Company, N.A., as trustee
(the "Trustee"). The Series A Notes and the Series B Notes (as defined herein),
are collectively referred to herein as the "Notes". Capitalized terms used, but
not defined herein, shall have the meanings set forth in the Indenture.
The Series A Notes will be offered and sold to the Initial Purchaser
pursuant to an exemption from the registration requirements under the Securities
Act of 1933, as amended (the "Act"). Upon original issuance thereof, and until
such time as the same is no longer required under the applicable requirements of
the Act, the Notes shall bear the legends set forth in the final offering
circular, dated the date hereof (the "Offering Circular"). The Company has
prepared a preliminary offering circular, dated December 7, 2005 (the
"Preliminary Offering Circular"), and the Offering Circular relating to the
offer and sale of the Series A Notes (the "Offering").
2. Agreements to Sell and Purchase. On the basis of the
representations, warranties, agreements and covenants herein and subject to the
terms and conditions herein set forth, the Issuers agree to issue and sell to
the Initial Purchaser, and the Initial Purchaser agrees to purchase from the
Issuers, $200,000,000 aggregate principal amount of the Series A Notes for a
purchase price of $194,500,000.00 which is equal to the excess of (x) 100% of
the aggregate principal amount thereof over (y) the aggregate amount of fees and
commissions to the Initial Purchaser.
3. Terms of Offering. The Initial Purchaser has advised the Company,
and the Company understands, that the Initial Purchaser will make offers to sell
(the "Exempt Resales") some or all of the Series A Notes purchased by the
Initial Purchaser hereunder on the terms set forth in the Offering Circular, as
amended or supplemented, to persons (the "Subsequent Purchasers") whom the
Initial Purchaser (i) reasonably believes to be "qualified institutional buyers"
as defined in Rule 144A under the Act, as such Rule may be amended from time to
time ("QIBs"), (ii) reasonably believes (based upon written representations made
by such persons to the Initial Purchaser) to be institutional "accredited
investors" ("Accredited Investors") as defined in Rule 501(a)(1), (2), (3) or
(7) under the Act or (iii) reasonably believes to be non-U.S. persons in
reliance upon Regulation S under the Act.
Holders of the Series A Notes (including Subsequent Purchasers) will
have the registration rights set forth in the registration rights agreement
applicable to the Series A Notes (the "Registration Rights Agreement"), to be
executed on and dated as of the Closing Date. Pursuant to the Registration
Rights Agreement, the Issuers and the Subsidiary Guarantors will agree, among
other things, to file with the Securities and Exchange Commission (the
"Commission") (a) a registration statement under the Act (the "Exchange Offer
Registration Statement") relating to [ ]% Senior Notes of the Issuers due 2011
(the "Series B Notes") which shall be identical in all material respects to the
Series A Notes (except that the Series B Notes shall have been registered
pursuant to the Exchange Offer Registration Statement and will not be subject to
restrictions on transfer or contain additional interest provisions) to be
offered in exchange for the Series A Notes (such offer to exchange being
referred to as the "Registered Exchange Offer"), and/or (b) under certain
circumstances, a shelf registration statement pursuant to Rule 415 under the Act
(the "Shelf Registration Statement") relating to the resale by certain holders
of the Series A Notes.
Concurrently with the sale of the Series A Notes on the Closing Date,
the Company and The Majestic Star Casino Capital Corp. ("Capital"), a
wholly-owned subsidiary of the Company, will issue 9 1/2% senior secured notes
due 2010 (the "Senior Secured Notes") and Majestic Holdco, LLC ("Holdco"), the
parent of the Company and Majestic Star Holdco, Inc., a wholly-owned subsidiary
of Holdco, will issue 12 1/2% senior discount notes due 2011 (the "Discount
Notes"). As described in the Offering Circular, the Company intends to use a
portion of the proceeds from the sale of the Notes, the Senior Secured Notes and
the Discount Notes to, among other things, acquire (the "Acquisition") all of
the issued and outstanding capital stock of ▇▇▇▇▇ Indiana, Inc., a Delaware
corporation (and, together with ▇▇▇▇▇▇▇▇▇▇ Harbor Riverboats, L.L.C. and
▇▇▇▇▇▇▇▇▇▇ Harbor Parking Associates, LLC, "▇▇▇▇▇") pursuant to the stock
purchase agreement dated as of November 3, 2005, by and between the Company and
▇▇▇▇▇ Entertainment Resort Holdings, L.P. (the "Stock Purchase Agreement"). On
the Closing Date, the Company will also, amend its credit facility dated as of
October 7, 2003, by and between the Company and ▇▇▇▇▇ Fargo Foothill, Inc., in
the manner described in the Offering Circular (as amended, the "Amended Credit
Facility").
Pursuant to the Indenture, all subsidiaries of the Company listed on
Schedule A hereto other than ▇▇▇▇▇ (and upon the consummation of the
Acquisition, ▇▇▇▇▇) shall fully and unconditionally guarantee, on a senior
unsecured basis, to each holder of the Notes and the Trustee, the payment and
performance of the Company's obligations under the Indenture and the Notes (each
such subsidiary (including, upon the consummation of the Acquisition, ▇▇▇▇▇)
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being referred to herein as a "Subsidiary Guarantor" and such guarantee being
referred to herein as a "Guarantee").
Effective upon consummation of the Acquisition, the Company will (a)
cause ▇▇▇▇▇ to become a Subsidiary Guarantor and execute (i) a counterpart
hereto, (ii) the Indenture, (iii) the Guarantees, and (iv) the Registration
Rights Agreement, as required by the Indenture and Section 12 hereof.
This Agreement, the Indenture, the Registration Rights Agreement, the
Notes, the Guarantees, the Amended Credit Facility, together with all other
documents or instruments executed by the Issuers and the Subsidiary Guarantors
in connection with the transactions contemplated thereby, collectively are
referred to herein as the "Documents." The transactions contemplated by the
Documents are referred to herein as the "Transactions."
4. Delivery and Payment. Delivery to the Initial Purchaser of and
payment for the Series A Notes shall be made at a Closing (the "Closing") to be
held at 9:00 a.m., New York City time, on December 21, 2005, (such time and
date, the "Closing Date") at the offices of Mayer, Brown, ▇▇▇▇ & Maw LLP, ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇. The Closing Date and the location of
delivery of and the form of payment for the Series A Notes may be varied by
agreement between the Initial Purchaser and the Issuers.
The Issuers shall deliver to the Initial Purchaser one or more
certificates representing the Series A Notes in definitive form, registered in
such names and denominations as the Initial Purchaser may request, against
payment by the Initial Purchaser of the purchase price therefor by immediately
available Federal funds bank wire transfer to such bank account or accounts as
the Company shall designate to the Initial Purchaser at least two Business Days
prior to the Closing. The certificates representing the Series A Notes in
definitive form shall be made available to the Initial Purchaser for inspection
at the New York offices of Mayer, Brown, ▇▇▇▇ & Maw LLP (or such other place as
shall be reasonably acceptable to the Initial Purchaser) not later than 10:00
a.m., Eastern Standard Time, one Business Day immediately preceding the Closing
Date. Series A Notes to be represented by one or more definitive global
securities in book-entry form will be deposited on the Closing Date, by or on
behalf of the Company, with The Depository Trust Company ("DTC") or its
designated custodian, and registered in the name of Cede & Co.
5. Agreements of the Issuers and the Subsidiary Guarantors. Each of the
Issuers and the Subsidiary Guarantors, jointly and severally, hereby agrees:
(a) Certain Events. To (i) advise the Initial Purchaser promptly after
obtaining knowledge (and, if requested by the Initial Purchaser, confirm such
advice in writing) of (A) the issuance by any state securities commission of any
stop order suspending the qualification or exemption from qualification of any
of the Series A Notes for offer or sale in any jurisdiction, or the initiation
of any proceeding for such purpose by any state securities commission or other
regulatory authority, and (B) the happening of any event that makes any
statement of a material fact made in the Offering Circular untrue or that
requires the making of any additions to or changes in the Offering Circular in
order to make the statements therein, in the light of the circumstances under
which they are made, not misleading, (ii) use its best efforts to prevent the
issuance of any stop order or order suspending the qualification or exemption
from qualification
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of any of the Notes under any state securities or Blue Sky laws, and (iii) if at
any time any state securities commission or other regulatory authority shall
issue an order suspending the qualification or exemption from qualification of
any of the Series A Notes under any such laws, use its best efforts to obtain
the withdrawal or lifting of such order at the earliest possible time.
(b) Offering Circular. At any time prior to the completion of the sale
of all of the Series A Notes by the Initial Purchaser pursuant to Exempt
Resales, to (i) furnish the Initial Purchaser and those persons identified by
the Initial Purchaser to the Issuers, without charge, as many copies of the
Preliminary Offering Circular and the Offering Circular, and any amendments or
supplements thereto, as the Initial Purchaser may reasonably request, and (ii)
promptly prepare, upon the Initial Purchaser's request, any amendment or
supplement to the Offering Circular that the Initial Purchaser ▇▇▇▇▇ ▇▇▇ be
necessary in connection with Exempt Resales (and the Issuers and Subsidiary
Guarantors hereby consent, subject to the Initial Purchaser's compliance with
its representations and warranties set forth in Section 7, to the use of the
Preliminary Offering Circular and the Offering Circular, and any amendments and
supplements thereto, by the Initial Purchaser in connection with Exempt
Resales).
(c) Notice of Amendment or Supplement. Not to amend or supplement the
Offering Circular prior to the Closing Date, or at any time prior to the
completion of the resale of all of the Series A Notes by the Initial Purchaser
pursuant to Exempt Resales, unless the Initial Purchaser shall previously have
been advised thereof and shall not have objected thereto within three Business
Days after being furnished a copy thereof.
(d) Preparation of Amendments and Supplements. At any time prior to the
completion of the resale of all of the Series A Notes by the Initial Purchaser
pursuant to Exempt Resales, (i) if any event shall occur as a result of which,
in the reasonable judgment of the Issuers or the Initial Purchaser or their
respective counsel, it becomes necessary or advisable to amend or supplement the
Offering Circular in order to make the statements therein, in the light of the
circumstances when such Offering Circular is delivered to a purchaser pursuant
to an Exempt Resale, not misleading, or if it is necessary to amend or
supplement the Offering Circular to comply with Applicable Law (as defined
herein), forthwith to prepare an appropriate amendment or supplement to the
Offering Circular (in form and substance satisfactory to the Initial Purchaser)
so that as so amended or supplemented, (A) the Offering Circular will not
include an untrue statement of material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the
circumstances when it is so delivered, not misleading, and (B) the Offering
Circular will comply with Applicable Law, and (ii) if it becomes necessary or
advisable to amend or supplement the Offering Circular so that the Offering
Circular will contain all of the information specified in, and meet the
requirements of, Rule 144A(d)(4) under the Act, forthwith to prepare an
appropriate amendment or supplement to the Offering Circular (in form and
substance satisfactory to the Initial Purchaser) so that the Offering Circular,
as so amended or supplemented, will contain the information specified in, and
meet the requirements of, such Rule.
(e) Qualification of Securities. Prior to the sale of all of the Series
A Notes by the Initial Purchaser pursuant to Exempt Resales, to cooperate with
the Initial Purchaser and the Initial Purchaser's counsel in connection with the
qualification of the Series A Notes under the securities or Blue Sky laws of
such jurisdictions as the Initial Purchaser may request and
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continue such qualification in effect so long as reasonably required for Exempt
Resales, and to file such consents to service of process or other documents as
may be necessary in order to effect such qualification; provided, that none of
the Issuers and the Subsidiary Guarantors shall be required in connection
therewith to file any general consent to service of process or to register or
qualify as a foreign corporation in any jurisdiction where it is not now so
qualified or to subject itself to general taxation in respect of doing business
in any jurisdiction in which it is not otherwise so subject.
(f) Costs and Expenses. Whether or not any of the Offering or the
Transactions are consummated or this Agreement is terminated, to pay (i) all
costs, expenses, fees and taxes incident to and in connection with the
performance of the obligations of the Issuers and Subsidiary Guarantors under
this Agreement, including: (A) the preparation, printing and distribution of the
Preliminary Offering Circular and the Offering Circular and all amendments and
supplements thereto (including, without limitation, financial statements and
exhibits), and all preliminary and final Blue Sky memoranda and all other
agreements, memoranda, correspondence and other documents prepared and delivered
in connection herewith (including the furnishing of copies of the foregoing to
the Initial Purchaser and such other persons as the Initial Purchaser may
designate), (B) the processing and distribution (including, without limitation,
word processing and duplication costs) and delivery of, and performance under,
each of the Documents and any other agreements or documents in connection with
the Transactions, (C) the preparation, issuance and delivery of the Notes,
including the fees and expenses of the Trustee (including reasonable fees and
expenses of its counsel) and all costs and expenses related to the delivery of
the Series A Notes to the Initial Purchaser and pursuant to Exempt Resales,
including any transfer or other taxes payable thereon and (D) the qualification
of the Notes for offer and sale under the securities or Blue Sky laws of the
several states (including, without limitation, filing fees and reasonable fees
and disbursements of the Initial Purchaser's counsel relating to such
registration or qualification and the preparation of memoranda related thereto),
(ii) all fees and expenses of the counsel and accountants of the Issuers and
Subsidiary Guarantors (except for any fees and expenses of ▇▇▇▇▇ prior to the
Closing Date), (iii) all expenses and listing fees in connection with the
application for quotation of the Series A Notes on the Private Offerings,
Resales and Trading Automated Linkages ("PORTAL") market, (iv) all fees and
expenses (including fees and expenses of counsel) of the Issuers in connection
with approval of the Notes by DTC for "book-entry" transfer, (v) all fees
charged by rating agencies in connection with the rating of the Notes, (vi) all
fees and expenses (including reasonable fees and expenses of counsel) of the
Trustee, (vii) all costs and expenses of the Registered Exchange Offer, the
Exchange Offer Registration Statement and any Shelf Registration Statement, as
set forth in the Registration Rights Agreement, (viii) all fees and expenses
(including reasonable fees and expenses of counsel, subject to any limitations
imposed by previous agreements between the parties) incurred by the Initial
Purchaser in connection with the preparation, negotiation and execution of the
Documents and the consummation of the Transactions and (ix) all other costs and
expenses incident and necessary to the performance of the obligations of the
Issuers and the Subsidiary Guarantors under this Agreement for which provision
is not otherwise made in this section.
(g) Use of Proceeds. To use their respective reasonable best efforts to
use the proceeds from the sale of the Series A Notes in the manner described in
the Offering Circular under the caption "Use of Proceeds."
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(h) Waiver of Certain Laws. To the extent it may lawfully do so, not to
insist upon, plead, or in any manner whatsoever claim or take the benefit or
advantage of, any stay, extension usury or other law, wherever enacted, now or
at any time hereafter in force, that would prohibit or forgive the payment of
all or any portion of the principal of or interest on the Notes, or that may
affect the covenants or the performance of the Indenture (and, to the extent it
may lawfully do so, each Issuer hereby expressly waives all benefit or advantage
of any such law, and covenants that it shall not, by resort to any such law,
hinder, delay or impede the execution of any power granted to the Trustee in the
Indenture but shall suffer and permit the execution of every such power as
though no such law had been enacted).
(i) Integration. Not to, and to ensure that no affiliate (as defined in
Rule 501(b) under the Act) of any of the Issuers or Subsidiary Guarantors will,
sell, offer for sale or solicit offers to buy or otherwise negotiate in respect
of any "security" (as defined in the Act) that would be integrated with the sale
of the Series A Notes in a manner that would require the registration under the
Act of the sale to the Initial Purchaser or of offers or sales of Series A Notes
pursuant to Exempt Resales.
(j) Rule 144A Information. For so long as any of the Series A Notes
remain outstanding, during any period in which either of the Issuers is not
subject to Section 13 or 15(d) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), to make available, upon request, to any holder of
the Notes in connection with any sale thereof, the information required by Rule
144A(d)(4) under the Act.
(k) DTC. To obtain the approval of DTC for "book entry" transfer of the
Notes, and to comply with the representation letter of the Issuers and the
Subsidiary Guarantors to DTC relating to the approval of the Notes by DTC for
"book entry" transfer.
(l) PORTAL. To use its best efforts to effect the inclusion of the
Series A Notes in PORTAL and to use its best efforts to maintain the listing of
the Series A Notes on PORTAL for so long as the Series A Notes are outstanding.
(m) Reporting Requirements. For so long as any of the Notes are
outstanding, (i) to furnish to the Trustee and deliver or cause to be delivered
to the holders of the Notes and the Initial Purchaser, within 15 days after
either Issuer is or would have been required to file such with the Commission,
(A) all quarterly and annual financial information that would be required to be
contained in a filing with the Commission on Forms 10-Q and 10-K if the Issuers
were required to file such Forms, including for each a "Management's Discussion
and Analysis of Financial Condition and Results of Operations" and, with respect
to the annual information only, a report thereon by the Issuers' independent
certified public accountants and (B) all information that would be required to
be contained in a filing with the Commission on Form 8-K if the Issuers were
required to file such reports, provided, however, that in no case shall the
Company be required to furnish materials pursuant to this paragraph which are
filed and publicly accessible via ▇▇▇▇▇ and (ii) from and after the time the
Exchange Offer Registration Statement or the Shelf Registration Statement (or
other registration statement under the Act with respect to the Notes) is filed
with the Commission, to file such information with the Commission so long as the
Commission will accept such filings.
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(n) No Selling Efforts or General Solicitation. Except in connection
with the Registered Exchange Offer or the filing of the Shelf Registration
Statement, not to, and not to authorize or permit any person acting on its
behalf to, (i) distribute any offering material in connection with the offer and
sale of the Series A Notes other than the Preliminary Offering Circular and the
Offering Circular and any amendments and supplements to the Offering Circular
prepared in compliance with this Agreement, or (ii) solicit any offer to buy or
offer to sell the Series A Notes by means of any form of general solicitation or
general advertising (including, without limitation, as such terms are used in
Regulation D under the Act) or in any manner involving a public offering within
the meaning of Section 4(2) of the Act.
(o) No Similar Offerings. Except as described in the Offering Circular,
during the period beginning on the date hereof and continuing to and including
the Closing Date, not to, directly or indirectly, without the prior consent of
the Initial Purchaser, offer, sell, contract to sell, grant any option to
purchase or otherwise dispose of (or announce any offer or sale of, contract to
sell, grant of any option to purchase or other disposition of) any debt
securities of any of the Issuers or Subsidiary Guarantors substantially similar
to the Notes and the Guarantees; provided, that the foregoing will not apply to
(i) the Notes and the Guarantees, (ii) borrowings from financial institutions,
(iii) the Senior Secured Notes and any guarantees thereunder and (iv) the
Discount Notes, in the case of each of clauses (i) through (iv) of this Section
5(o), only to the extent not prohibited by the Indenture.
(p) Performance of Agreements. To comply in all material respects with
all of its agreements set forth in the Documents, and to use its reasonable best
efforts to do and perform all things required or necessary to be done and
performed under this Agreement by it prior to the Closing Date and to satisfy
all conditions precedent to the delivery of the Series A Notes and the
Guarantees.
6. Representations and Warranties of the Issuers and the Subsidiary
Guarantors. As of the date hereof, each of the Issuers and the Subsidiary
Guarantors, jointly and severally, represents and warrants to the Initial
Purchaser that:
(a) Offering Circular. The Preliminary Offering Circular as of its date
did not, and the Offering Circular, as of its date did not, and as of the
Closing Date will not, and each supplement or amendment therto as of its date
will not, contain any untrue statement of a material fact or omit to state any
material fact (except, in the case of the Preliminary Offering Circular, for
pricing terms and other financial terms intentionally left blank) necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. The foregoing representation and warranty
made in this Section 6(a) shall not apply to any statements or omissions made in
reliance on and in conformity with information relating to the Initial Purchaser
furnished in writing to the Issuers by the Initial Purchaser specifically for
inclusion in the Preliminary Offering Circular or the Offering Circular. The
parties hereto acknowledge that for purposes of this Agreement (including this
Section 6(a) and Section 8) the only information furnished in writing to the
Issuers by the Initial Purchaser specifically for inclusion in the Preliminary
Offering Circular or the Offering Circular is the information set forth (i) on
the cover page of the Offering Circular with respect to the price of the Notes,
Senior Notes and Discount Notes (ii) in the third paragraph on page 185 of the
Offering Circular concerning offering the Notes, Senior Notes and Discount Notes
for resale by the Initial
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Purchaser, (iii) in the fifth paragraph on page 185 of the Offering Circular
concerning market-making by the Initial Purchaser, (iv) in the sixth paragraph
on page 185 of the Offering Circular concerning stabilization by the Initial
Purchaser and (v) in the first full paragraph on page 186 of the Offering
Circular concerning the affiliation of the Initial Purchaser and their
respective affiliates with the Issuers and their affiliates (such information
described in the immediately preceding clauses (i) through (v) of this Section
6(a), the "Furnished Information"). Each of the Preliminary Offering Circular
and the Offering Circular, as of their respective dates contained, and the
Offering Circular, as of the Closing Date and as amended or supplemented, will
contain, all of the information required by Rule 144A(d)(4) under the Act. Each
of the Documents, as executed and delivered, and each of the Transactions,
conforms to the description thereof in the Offering Circular.
(b) Due Organization; Good Standing. Each of the Issuers and Subsidiary
Guarantors (i) has been duly organized, is validly existing and is in good
standing under the laws of its jurisdiction of organization, (ii) has all
requisite power and authority to conduct and carry on its business and to own,
lease, use and operate its properties and assets as described in the Offering
Circular, and (iii) is duly qualified or licensed to do business and is in good
standing as a foreign limited liability company or corporation, as the case may
be, authorized to do business in each jurisdiction in which the nature of its
business or the ownership, leasing, use or operation of its properties and
assets requires such qualification or licensing, except where failure to be so
qualified or licensed and in good standing would not have a material adverse
effect on (A) the properties, business, operations, earnings, assets,
liabilities or condition (financial or otherwise) of the Issuers and the
Subsidiary Guarantors, taken as a whole, (B) the ability of the Issuers and
Subsidiary Guarantors to perform their obligations under any of the Documents,
or (C) the validity of any of the Documents or the consummation of any of the
Transactions (each, a "Material Adverse Effect").
(c) Subsidiaries. Immediately following the Closing, (i) Capital II
will have no subsidiaries, (ii) the only subsidiaries of the Company will be
Capital, Capital II and the Subsidiary Guarantors (collectively, the
"Subsidiaries" and each, a "Subsidiary"), (iii) the Company will directly or
indirectly own 100% of the outstanding shares of capital stock, membership
interests or other equity interests in Capital and each Subsidiary, in each
case, free and clear of all Liens, except for Permitted Liens and (iv) Majestic
Holdco, LLC will directly own 100% of the outstanding membership interests in
the Company free and clear of all Liens, except for Permitted Liens. Except as
disclosed in the Offering Circular, there are no outstanding (i) securities
convertible into or exchangeable for any capital stock of, or any membership
interests in, as the case may be, any of the Issuers or Subsidiary Guarantors,
(ii) options, warrants or other rights to purchase or subscribe for any capital
stock of or any membership interests in, or any securities convertible into or
exchangeable for any capital stock of or any membership interests in, as the
case may be, any of the Issuers or Subsidiary Guarantors or (iii) contracts,
commitments, agreements, understandings, arrangements, undertakings, rights,
calls or claims of any kind relating to the issuance of any capital stock of, or
any membership interests in, as the case may be, any of the Issuers or
Subsidiary Guarantors, any such convertible or exchangeable securities or any
such options, warrants or rights. Except as set forth above, immediately
following the Closing, none of the Issuers or Subsidiary Guarantors will
directly or indirectly own any capital stock of or other equity interest in any
person.
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(d) Capitalization. All of the outstanding membership interests,
capital stock or other equity interests in the Company and each of the
Subsidiaries are validly issued and were not issued in violation of, and are not
subject to, any preemptive or similar rights. The table under the caption
"Capitalization" in the Offering Circular (including the footnotes thereto) sets
forth, as of its date, the pro forma capitalization of the Issuers and the
Subsidiaries, on a consolidated basis, after giving effect to the Transactions
and the Acquisition. Immediately following the Closing, except as set forth in
such table, neither of the Issuers nor any of the Subsidiaries will have any
liabilities, absolute, accrued, contingent or otherwise other than (i)
liabilities that are reflected in the Financial Statements (as defined herein),
(ii) liabilities incurred subsequent to September 30, 2005, in the ordinary
course of business, consistent with past practice, that would not, singly or in
the aggregate, have a Material Adverse Effect, or (iii) loans made under the
Amended Credit Facility.
(e) No Other Registration Rights. Except for this Agreement, the
Registration Rights Agreement, the registration rights agreement relating to the
Senior Secured Notes, the purchase agreement relating to the Senior Secured
Notes and the Stock Purchase Agreement, there are no contracts, commitments,
agreements, arrangements, understandings or undertakings of any kind to which
any of the Issuers or Subsidiary Guarantors is a party, or by which any of them
is bound, granting to any person the right (i) to require either of the Issuers
or any Subsidiary Guarantor to file a registration statement under the Act with
respect to any securities of either of the Issuers or any Subsidiary Guarantor
or requiring either of the Issuers or any Subsidiary Guarantor to include such
securities with the Notes registered pursuant to any registration statement, or
(ii) to purchase or offer to purchase any securities of any of the Issuers or
Subsidiary Guarantors.
(f) Power and Authority. Each of the Issuers and Subsidiary Guarantors
has all requisite power and authority to execute and deliver, and to perform its
obligations under, the Documents to which it is a party and to consummate the
transactions contemplated thereby.
(g) Authorization of this Agreement. This Agreement and the
Transactions have been duly authorized by each of the Issuers and the Subsidiary
Guarantors (other than ▇▇▇▇▇), and this Agreement has been validly executed and
delivered by, and is the legal, valid and binding obligation of, each of the
Issuers and the Subsidiary Guarantors (other than ▇▇▇▇▇), enforceable against
each of the Issuers and the Subsidiary Guarantors (other than ▇▇▇▇▇) in
accordance with its terms, and, effective upon consummation of the Acquisition,
will be duly authorized, validly executed and delivered by, and will become the
legal, valid and binding obligation of ▇▇▇▇▇ enforceable against ▇▇▇▇▇ in
accordance with its terms, except that (i) such enforceability may be limited by
applicable bankruptcy, insolvency or similar laws affecting creditors' rights
generally, (ii) any rights of acceleration and the availability of equitable
remedies may be subject to general principles of equity (whether considered in a
proceeding in equity or at law) and (iii) the enforceability of the provisions
of Section 8 providing for the indemnification of or contribution to a party
with respect to a liability may be limited if such provisions violate or are
contrary to public policy under applicable law.
(h) Authorization of Indenture. The Indenture and the transactions
contemplated thereby have been duly authorized by each of the Issuers and the
Subsidiary Guarantors (other than ▇▇▇▇▇) and, effective upon the consummation of
the Acquisition, will be duly authorized
9
by ▇▇▇▇▇, and, on the Closing Date, the Indenture will have been validly
executed and delivered by, and will be the legal, valid and binding obligation
of, each of the Issuers and the Subsidiary Guarantors, enforceable against each
of the Issuers and the Subsidiary Guarantors in accordance with its terms,
except that (i) such enforceability may be limited by applicable bankruptcy,
insolvency or similar laws affecting creditors' rights generally and (ii) any
rights of acceleration and the availability of equitable remedies may be subject
to general principles of equity (whether considered in a proceeding in equity or
at law). On the Closing Date, the Indenture will conform to the requirements of
the Trust Indenture Act of 1939, as amended (the "TIA"), applicable to an
indenture that is required to be qualified under the TIA.
(i) Authorization of Registration Rights Agreement. The Registration
Rights Agreement and the transactions contemplated thereby have been duly
authorized by each of the Issuers and the Subsidiary Guarantors (other than
▇▇▇▇▇) and, effective upon the consummation of the Acquisition, will be validly
authorized by ▇▇▇▇▇, and, on the Closing Date, the Registration Rights Agreement
will have been validly executed and delivered by, and will be the legal, valid
and binding obligation of, each of the Issuers and the Subsidiary Guarantors,
enforceable against each of the Issuers and the Subsidiary Guarantors in
accordance with its terms, except that (i) such enforceability may be limited by
applicable bankruptcy, insolvency or similar laws affecting creditors' rights
generally, (ii) any rights of acceleration and the availability of equitable
remedies may be subject to general principles of equity (whether considered in a
proceeding in equity or at law) and (iii) the enforceability of the provisions
thereof providing for the indemnification of or contribution to a party with
respect to a liability may be limited if such provisions violate or are contrary
to public policy under applicable law.
(j) Authorization of Series A Notes. The Series A Notes have been duly
authorized by each of the Issuers for issuance and sale to the Initial Purchaser
pursuant to this Agreement and, on the Closing Date, will have been validly
executed, authenticated, issued and delivered by the Issuers in accordance with
the terms of this Agreement and the Indenture. When the Series A Notes have been
issued, executed and authenticated in accordance with the terms of the Indenture
and delivered to and paid for by the Initial Purchaser in accordance with the
terms of this Agreement, the Series A Notes will be legal, valid and binding
obligations of each of the Issuers, entitled to the benefits of the Indenture
and enforceable against each of the Issuers in accordance with their terms,
except to the extent that (i) such enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
(ii) any rights of acceleration and the availability of equitable remedies may
be subject to general principles of equity (whether considered in a proceeding
in equity or at law). The Notes rank and will rank on a parity with all senior
Indebtedness (as defined in the Indenture) of each of the Issuers that is
outstanding on the date hereof or that may be incurred hereafter and senior to
all other Indebtedness of each of the Issuers that is outstanding on the date
hereof or that may be incurred hereafter.
(k) Authorization of Series B Notes. The Series B Notes have been duly
authorized by each of the Issuers and, when issued in the Registered Exchange
Offer, (A) will have been validly executed, authenticated, issued and delivered
in accordance with the terms of the Indenture, the Registration Rights Agreement
and the Registered Exchange Offer and (B) will be legal, valid and binding
obligations of each of the Issuers, entitled to the benefits of the Indenture
and enforceable against each of the Issuers in accordance with their terms,
except to the extent
10
that (i) such enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting creditors' rights generally and (ii) any rights of
acceleration and the availability of equitable remedies may be subject to
general principles of equity (whether considered in a proceeding in equity or at
law).
(l) No Violation. The Company is not in violation of its certificate of
formation or operating agreement (the "Company Charter Documents"), Capital II
is not in violation of its charter or bylaws (the "Capital II Charter
Documents"), Capital is not in violation of its charter or bylaws (the "Capital
Charter Documents") and none of the Subsidiary Guarantors is in violation of its
certificate of formation or charter, as the case may be, or operating agreement
or bylaws, as the case may be, (the "Subsidiary Guarantor Charter Documents"
and, collectively with the Capital Charter Documents, the Capital II Charter
Documents and the Company Charter Documents, the "Charter Documents"). None of
the Issuers and Subsidiary Guarantors is (i) in violation of any applicable
federal, state, local or foreign statute, law or ordinance, or any judgment,
decree, rule, regulation or order, including, without limitation, the Indiana
Riverboat Gambling Act, the Mississippi Gaming Control Act and the Colorado
Limited Gaming Act of 1991, in each case including the rules and regulations
promulgated thereunder (collectively, "Applicable Law"), of any government,
governmental or regulatory agency or body (including, without limitation, the
Indiana Gaming Commission, the Mississippi Gaming Commission, the Colorado
Limited Gaming Control Commission, the Colorado Division of Gaming or other
applicable gaming authority (each, a "Gaming Authority")), court, arbitrator or
self-regulatory organization, domestic or foreign (each, a "Governmental
Authority"), other than violations that would not, singly or in the aggregate,
have a Material Adverse Effect, or (ii) in breach of or default under any bond,
debenture, note or other evidence of indebtedness, indenture, mortgage, deed of
trust, lease or any other agreement or instrument to which any such person is a
party or by which any of them or any of their respective property is bound
(collectively, "Applicable Agreements"), other than breaches or defaults that
would not, singly or in the aggregate, have a Material Adverse Effect. There
exists no condition that, with the passage of time or otherwise, would (x)
constitute a violation of such Charter Documents or Applicable Laws or (y)
constitute a breach of or default under any Applicable Agreement or (z) result
in the imposition of any penalty or the acceleration of any indebtedness, other
than, in the case of the immediately preceding clauses (y) and (z), such
breaches, penalties or defaults that would not, singly or in the aggregate, have
a Material Adverse Effect. All Applicable Agreements are in full force and
effect and are legal, valid and binding obligations, and no default has occurred
or is continuing thereunder, other than such defaults that would not, singly or
in the aggregate, have a Material Adverse Effect.
(m) No Conflict. None of the execution, delivery or performance by the
Issuers or the Subsidiary Guarantors of any of the Documents to which they are
or will become parties, nor the compliance with the terms and provisions
thereof, nor the consummation of any of the Transactions shall conflict with,
violate, constitute a breach of or a default (with the passage of time or
otherwise) under, requires the consent of any person (other than consents
already obtained and in full force and effect or that will have been obtained on
or prior to the Closing Date) under, results in the imposition of a Lien on any
assets or capital stock of, or membership interests in, either of the Issuers or
any of the Subsidiaries (other than Permitted Liens), or results in an
acceleration of indebtedness under, or pursuant to, (i) the Charter Documents,
(ii) any Applicable Agreement, or (iii) any Applicable Law, assuming, in the
case of any Exempt Resales
11
made to Accredited Investors, the accuracy of the representations and warranties
of such Accredited Investors contained in letters of representations in the form
of Annex A attached to the Offering Circular executed by such Accredited
Investors. After giving effect to the Transactions, no Default or Event of
Default will exist.
(n) Permits. No permit, certificate, authorization, approval, consent,
license or order of, or filing, registration, declaration or qualification with,
any Governmental Authority or any other person (collectively, "Permits") is
required in connection with, or as a condition to, the execution, delivery or
performance of any of the Documents, the compliance with the terms and
provisions thereof or the consummation of any of the Transactions, other than
(i) such Permits as have been made or obtained on or prior to the Closing Date,
which Permits are in full force and effect on the Closing Date, (ii) such
Permits, the failure of which to make or obtain would not, singly or in the
aggregate, have a Material Adverse Effect, (iii) the filing of the Exchange
Offer Registration Statement and, if required by the Registration Rights
Agreement, the Shelf Registration Statement, with applicable Gaming Authorities,
(iv) the approval of the Indiana Gaming Commission of the Documents prior to
Closing, (v) the filing of loan reports with the Mississippi Gaming Commission
pursuant to MGC Regulation II Licensing I, Section 11 with respect to the
offering of the Notes and the transactions related to the Amended Credit
Facility and (vi) the Colorado Division of Gaming and the Colorado Gaming
Commission post-closing regulatory approval (the Permits described in clauses
(iii), (v) and (vi) of this Section 6(n), collectively, the "Post-Closing
Permits").
(o) No Proceedings. There is no action, claim, suit, demand, hearing,
notice of violation or deficiency, or proceeding (including, without limitation,
any investigation or partial proceeding, such as a deposition), domestic or
foreign (collectively, "Proceedings"), pending or, to the knowledge of the
Issuers or the Subsidiary Guarantors, threatened (i) either with respect to any
of the Issuers and Subsidiary Guarantors in connection with, or that seeks to
restrain, enjoin, prevent the consummation of, or otherwise challenge, any of
the Documents or any of the Transactions, or (ii) that could, singly or in the
aggregate, have a Material Adverse Effect. Other than rules and regulations of
Gaming Authorities, none of the Issuers and Subsidiary Guarantors is subject to
any judgment, order, decree, rule or regulation of any Governmental Authority
that could, singly or in the aggregate, have a Material Adverse Effect. No
injunction or order has been issued and no Proceeding is pending or, to the
knowledge of the Issuers and the Subsidiary Guarantors, threatened that (i)
asserts that the offer, sale and delivery of the Series A Notes and the
Guarantees to the Initial Purchaser pursuant to this Agreement or the initial
resale of the Series A Notes and the Guarantees by the Initial Purchaser in the
manner contemplated by this Agreement is subject to the registration
requirements of the Act, or (ii) would prevent or suspend the issuance or sale
of the Notes, including the Exempt Resales, or the use of the Preliminary
Offering Circular, the Offering Circular, or any amendment or supplement
thereto, in any jurisdiction.
(p) Regulated Persons. Each of the Issuers and the Subsidiary
Guarantors and each of their respective directors, members, managers, officers
and employees (each of the Issuers and the Subsidiary Guarantors and each of
such other persons, a "Regulated Person" and, collectively, the "Regulated
Persons") has all Permits (including, without limitation, Permits with respect
to engaging in gaming operations) necessary or advisable to own, lease, use and
operate the properties and assets and to conduct and carry on the businesses
described in the
12
Offering Circular, other than such Permits the failure of which to have would
not, singly or in the aggregate, have a Material Adverse Effect on the Exchange
Offer. All such Permits are valid and in full force and effect. Each of the
Regulated Persons is in compliance with the terms and conditions of all Permits
(including, without limitation, Permits with respect to engaging in gaming
operations) necessary or advisable to own, lease, use and operate the properties
and assets and to conduct and carry on the businesses described in the Offering
Circular, other than where such failure to be in compliance would not, singly or
in the aggregate, have a Material Adverse Effect. None of the execution,
delivery or performance of any of the Documents, nor the compliance with the
terms and provisions thereof, nor the consummation of any of the Transactions
will allow or result in, and no event has occurred which allows or results in,
or after notice or lapse of time would allow or result in, the imposition of any
material penalty under, or the revocation or termination of, any such Permit or
any material impairment of the rights of the holder of any such Permit. None of
the Issuers or Subsidiary Guarantors has any reason to believe that any
Regulated Person is considering limiting, conditioning, suspending, modifying,
revoking or not renewing any such Permit.
(q) No Investigations of Regulated Persons. To the knowledge of the
Issuers and the Subsidiary Guarantors, (i) no Governmental Authority is
investigating any Regulated Person, other than ongoing general oversight
investigations conducted in the ordinary course of business, and (ii) there is
no basis for any of the Gaming Authorities to deny the renewal of the current
Permits held by any of the Regulated Persons.
(r) Title to Assets. Immediately following the Closing, each of the
Issuers and each of the Subsidiary Guarantors (i) will have good and marketable
title, free and clear of all Liens (other than Permitted Liens), to all property
and assets described in the Offering Circular to be owned by it, (ii) will enjoy
peaceful and undisturbed possession under all leases of real property and under
all material leases to which it is a party as lessee and (iii) will hold a valid
leasehold interest with respect to each such lease. Capital and Capital II have
no material assets.
(s) Sufficiency and Condition of Assets. The assets of each of the
Issuers and the Subsidiary Guarantors include all of the assets and properties
necessary or required in, or otherwise material to, the conduct of the
businesses of each of them as currently conducted and as proposed to be
conducted, and such assets are in working condition, except where the failure of
such assets to be in working condition would not, singly or in the aggregate,
have a Material Adverse Effect.
(t) Insurance. Each of the Issuers and the Subsidiaries maintains
reasonably adequate insurance covering its properties, operations, personnel and
businesses against losses and risks in accordance with customary industry
practice. All such insurance is outstanding and duly in force.
(u) Real Property. No condemnation, eminent domain, or similar
proceeding exists, is pending or, to the knowledge of the Issuers and the
Subsidiary Guarantors, is threatened, with respect to or that could affect any
properties or assets of either of the Issuers or any of the Subsidiary
Guarantors, except for such proceedings as would not, singly or in the
aggregate, have a Material Adverse Effect. No owned real property of either of
the Issuers or any of the Subsidiary Guarantors is subject to any sales
contract, option, right of first refusal or similar
13
agreement or arrangement with any third party. There is no real property
currently under contract or subject to an option in favor of any of the Issuers
or any of the Subsidiary Guarantors, except for real property which the failure
of the Issuers or any of the Subsidiary Guarantors to acquire, would not, singly
or in the aggregate, have a Material Adverse Effect.
(v) Related Party Transactions. Except as adequately disclosed in the
Offering Circular, there are no related party transactions that would be
required to be disclosed in the Offering Circular if the Offering Circular were
a prospectus included in a registration statement on Form S-1 filed under the
Act.
(w) Taxes. All tax returns required to be filed by either of the
Issuers or by any of the Subsidiary Guarantors in any jurisdiction (including
foreign jurisdictions) have been filed and, when filed, all such returns were
accurate in all material respects, and all taxes, assessments, fees and other
charges (including, without limitation, withholding taxes, penalties and
interest) due or claimed to be due from either of the Issuers or from any of the
Subsidiary Guarantors have been paid, other than those being contested in good
faith by appropriate proceedings, or those that are currently payable without
penalty or interest and, in each case, for which an adequate reserve or accrual
has been established on the books and records of the Issuers or the Subsidiary
Guarantors, as applicable, in accordance with generally accepted accounting
principles of the United States, consistently applied ("GAAP"). Except as
disclosed in the Offering Circular, there are no actual or proposed additional
tax assessments for any tax period against either of the Issuers or against any
of the Subsidiary Guarantors that could, singly or in the aggregate, have a
Material Adverse Effect. The charges, accruals and reserves on the books and
records of the Issuers and the Subsidiary Guarantors, as applicable, in respect
of any tax liability for any tax periods not finally determined are adequate to
meet any assessments of tax or re-assessments of additional tax for any such
period.
(x) Intellectual Property. The Issuers and the Subsidiary Guarantors
own or possess, or are licensed under, and have the right to use, all patents,
patent rights, licenses, inventions, copyrights, know-how (including trade
secrets and other unpatented and/or unpatentable proprietary or confidential
information, systems or procedures), trademarks, service marks and trade names
(collectively, "Intellectual Property") currently used in, currently proposed to
be used in, or necessary for the conduct of, their businesses, free and clear of
all Liens, other than Permitted Liens, except where the failure to own or
possess or otherwise be able to acquire such Intellectual Property would not,
singly or in the aggregate, have a Material Adverse Effect. Except as disclosed
in the Offering Circular, to the knowledge of the Issuers and the Subsidiary
Guarantors, no claims have been asserted by any person challenging the use of
any such Intellectual Property by any of the Issuers or the Subsidiary
Guarantors or questioning the validity or effectiveness of any license or
agreement related thereto, and to the knowledge of the Issuers and the
Subsidiary Guarantors, there is no valid basis for any such claim, and to the
knowledge of the Issuers and the Subsidiary Guarantors, the use of such
Intellectual Property by the Issuers and the Subsidiary Guarantors will not
infringe on the Intellectual Property rights of any other person.
(y) Accounting Controls. Each of the Issuers and the Subsidiary
Guarantors maintains a system of internal accounting controls sufficient to
provide reasonable assurance that (i) material transactions are executed in
accordance with management's general or specific
14
authorization, (ii) material transactions are recorded as necessary to permit
preparation of financial statements in conformity with GAAP, and to maintain
asset accountability, (iii) access to assets is permitted only in accordance
with management's general or specific authorization, and (iv) the recorded
accountability for assets is compared with the existing assets at reasonable
intervals and appropriate action is taken with respect to any material
differences.
(z) Financial Statements. The audited historical consolidated financial
statements and related notes of the Company and its subsidiaries and the audited
historical financial statements and related notes of ▇▇▇▇▇ Indiana, Inc.,
▇▇▇▇▇▇▇▇▇▇ Harbor Riverboats, LLC and ▇▇▇▇▇▇▇▇▇▇ Harbor Parking Associates, LLC
contained in the Offering Circular (the "Audited Financial Statements") and the
unaudited consolidated historical financial statements and related notes of the
Company and its subsidiaries and the unaudited historical financial statements
and related notes of ▇▇▇▇▇ Indiana, Inc. contained in the Offering Circular (the
"Interim Financial Statements" and, together with the Audited Financial
Statements, the "Financial Statements") present fairly the financial position,
results of operations and cash flows of such entities on the basis stated in the
Offering Circular, as of the respective dates and for the respective periods to
which they apply, and have been prepared in accordance with GAAP consistently
applied throughout the periods involved, except as disclosed in the Financial
Statements. The summary historical financial data included in the Offering
Circular have been prepared on a basis consistent with that of the Financial
Statements and present fairly the financial position and results of operations
of the applicable entities, as of the respective dates and for the respective
periods indicated.
The unaudited pro forma condensed combined financial statements and
related notes, excluding EBITDA and Adjusted EBITDA data, included in the
Offering Circular (i) comply with the requirements of Regulation S-X that would
be applicable if the Offering Circular were a prospectus included in a
registration statement on Form S-1 filed under the Act (the "S-X Requirements")
and all other rules and guidelines of the Commission with respect to pro forma
financial statements, (ii) present fairly the unaudited pro forma condensed
combined financial position and results of operations of the entities described
in the Offering Circular as of the dates and for the periods indicated, after
giving effect to the Transactions, the Acquisition, and the other transactions
described in the Offering Circular, (iii) have been prepared on a basis
consistent with the Financial Statements, except for the pro forma adjustments
specified therein, and (iv) are based on good faith, reasonable estimates and
assumptions of the Company. Except as described in the Offering Circular, the
summary unaudited pro forma financial data included in the Offering Circular has
been derived from such pro forma financial statements and presents fairly the
pro forma consolidated financial position and results operations of the entities
described in the Offering Circular as of the respective dates and for the
respective periods indicated.
All other financial and statistical data regarding the Issuers and the
Subsidiaries included in the Offering Circular are fairly and accurately
presented. To the knowledge of the Company, (i) PricewaterhouseCoopers LLP, the
accountants who have audited the financial statements of the Issuers and the
Subsidiaries (other than ▇▇▇▇▇), included as part of the Preliminary Offering
Circular and the Offering Circular and (ii) Ernst & Young LLP, the accountants
who have audited the financial statements of ▇▇▇▇▇, included as part of the
Preliminary Offering Circular and the Offering Circular, are independent
certified public accountants with respect to the
15
Company and the Subsidiaries (other than ▇▇▇▇▇) and ▇▇▇▇▇, as applicable, under
Rule 101 of the AICPA's code of Professional conduct and its interpretations and
rulings, during the periods covered by the financial statements on which they
reported included in the Offering Circular.
To the knowledge of the Company (i) at October 31, 2005, there was no
material (x) change in the capital stock, (y) increase in long-term debt or (z)
decrease in consolidated net current assets or stockholders' equity of the
Company, on a consolidated basis, as compared with amounts shown in the
September 30, 2005, unaudited consolidated balance sheet included in the
Offering Circular, or (ii) for the period from September 30, 2005 to October 31,
2005, there was no material decrease, as compared to the corresponding period in
the preceding year, in consolidated net sales or in the total amounts of income
before extraordinary items or of net income, except in all instances for
changes, increases or decreases that the Offering Circular discloses have
occurred or may occur.
No financial statements as of any date or for any period subsequent to
October 31, 2005, are available. However, to the Company's knowledge, (i) at
November 30, 2005, there was no material (x) change in the capital stock (y)
increase in long-term debt or (z) material decrease in consolidated net current
assets or stockholders' equity of the Company, on a consolidated basis, as
compared with amounts shown in the September 30, 2005, unaudited consolidated
balance sheet included in the Offering Circular, or (ii) for the period from
October 31, 2005 to November 30, 2005, there was no material decrease, as
compared to the corresponding period in the preceding year, in consolidated net
sales or in the total amounts of income before extraordinary items or of net
income, except in all instances for changes, increases or decreases that the
Offering Circular discloses have occurred or may occur.
(aa) No Material Adverse Change. Subsequent to the respective dates as
of which information is given in the Offering Circular, except as adequately
disclosed in the Offering Circular, and except for the Acquisition and the
Transactions (i) neither of the Issuers nor any of the Subsidiary Guarantors has
incurred any liabilities, direct or contingent, that are material, singly or in
the aggregate, to any of them, or has entered into any material transactions not
in the ordinary course of business, (ii) there has not been any material
decrease in the capital stock or membership interests, as the case may be, or
any material increase in long-term indebtedness or any material increase in
short-term indebtedness of any of the Issuers or the Subsidiary Guarantors, or
any payment of or declaration to pay any dividends or any other distribution
with respect to any of the Issuers or the Subsidiary Guarantors, and (iii) there
has not been any material adverse change in the properties, business,
operations, earnings, assets, liabilities or condition (financial or otherwise)
of the Issuers and the Subsidiary Guarantors taken as a whole (each of clauses
(i), (ii) and (iii), a "Material Adverse Change"). Except as disclosed in the
Offering Circular, to the knowledge of the Issuers and the Subsidiary
Guarantors, there is no event that has occurred or that is reasonably likely to
occur which, if it were to occur, could reasonably be expected to, singly or in
the aggregate, have a Material Adverse Effect or result in a Material Adverse
Change.
(bb) Ratings. No "nationally recognized statistical rating
organization" as such term is defined for purposes of Rule 436(g)(2) under the
Act (i) has imposed (or has informed either of the Issuers or any Subsidiary
Guarantor that it is considering imposing) any condition (financial or
otherwise) on the Issuers' or any Subsidiary Guarantor's retaining any rating
assigned to any
16
securities of either of the Issuers or any Subsidiary Guarantor, or (ii) has
indicated to either of the Issuers or any Subsidiary Guarantor that it is
considering (A) the downgrading, suspension, or withdrawal of, or any review for
a possible change that does not indicate the direction of the possible change
in, any rating so assigned, or (B) any change in the outlook for any rating of
any securities of either of the Issuers or any Subsidiary Guarantor.
(cc) Solvency. Each of the Issuers and each Subsidiary Guarantor is
incurring its respective indebtedness under the Series A Notes and the
Guarantees for proper purposes and in good faith. Immediately before and after
giving effect to the issuance of the Series A Notes, (i) the assets of the
Issuers and their subsidiaries (including the Subsidiary Guarantors), considered
as a whole and as a going concern, at a fair valuation, will exceed the sum of
their debts, taken as a whole; (ii) the present fair salable value of the assets
of the Issuers and their subsidiaries (including the Subsidiary Guarantors),
considered as a whole and as a going concern, will exceed the amount required to
pay their liability on their debts, taken as a whole; (iii) each of the Issuers
will have adequate capital with which to conduct their respective present and
anticipated businesses; and (iv) neither the Issuers nor any Subsidiary
Guarantor will intend to incur or believe or reasonably should believe that it
will incur debts beyond its ability to pay as those debts become due. Neither
Issuer is aware of any reason why it would be inappropriate to consider, for
purposes of clauses (i) and (ii) above, the Issuers and the Subsidiaries as a
going concern. For purposes of this paragraph, "debts" includes contingent and
unliquidated debts.
(dd) No Solicitation. Neither of the Issuers nor any of their
affiliates nor anyone acting on their behalf has (i) taken, directly or
indirectly, any action designed to cause or to result in, or that has
constituted or which might reasonably be expected to constitute, the
stabilization or manipulation of the price of the Notes or to facilitate the
sale or resale of any of the Notes, (ii) sold, bid for, purchased, or paid
anyone any compensation for soliciting purchases of, any of the Notes, or (iii)
paid or agreed to pay to any person any compensation for soliciting another to
purchase any other securities of either of the Issuers.
(ee) No Registration of Notes. Without limiting any provision herein,
no registration under the Act, and no qualification of the Indenture under the
TIA is required for the sale of the Series A Notes and the Guarantees to the
Initial Purchaser as contemplated hereby or for the Exempt Resales, assuming (i)
that the purchasers in the Exempt Resales are QIBs, Accredited Investors or
non-U.S. persons (as defined under Regulation S under the Act), (ii) the
accuracy of the Initial Purchaser's representations contained in Section 7, and
(iii) the accuracy of the representations made by each Accredited Investor who
purchases the Series A Notes pursuant to an Exempt Resale as set forth in the
letter of representation in the form of Annex A to the Offering Circular. No
form of general solicitation or general advertising (including, without
limitation, as such terms are used in Regulation D under the Act) was used by
either of the Issuers or any of their respective affiliates or any of their
respective representatives in connection with the offer and sale of any of the
Series A Notes or in connection with Exempt Resales. No securities of the same
class as the Series A Notes have been offered, issued or sold by either of the
Issuers or any of their respective affiliates within the six-month period
immediately prior to the date hereof.
(ff) ERISA. The Issuers have disclosed to the Initial Purchaser each
employee benefit plan maintained by the Issuers and their Affiliates which is a
"plan" within the meaning of
17
Section 4975(e)(i) of the Internal Revenue Code of 1986, as amended, or the
regulations promulgated thereunder (the "Code"). No condition exists or event or
transaction has occurred in connection with any employee benefit plan that could
result in either of the Issuers or any such "Affiliate" incurring any liability,
fine or penalty that could, singly or in the aggregate, have a Material Adverse
Effect. Neither of the Issuers nor any Affiliate maintains any employee pension
benefit plan that is subject to Title IV of the Employee Retirement Income
Security Act of 1974, as amended, or the rules and regulations promulgated
thereunder ("ERISA"). The terms "employee benefit plan" and "employee pension
benefit plan" shall have the meanings assigned to such terms in Section 3 of
ERISA. The term "Affiliate" shall have the meaning assigned to such term in
Section 407(d)(7) of ERISA.
(gg) Investment Company Act and Other Federal Regulations. None of the
Issuers nor any of the Subsidiaries has taken, and none of them will take, any
action that may cause this Agreement or the issuance of the Series A Notes to,
and none of the Transactions will, violate or result in a violation of Section 7
of the Exchange Act (including, without limitation, Regulation T (12 C.F.R. Part
220), Regulation U (12 C.F.R. Part 221) or Regulation X (12 C.F.R. Part 224) of
the Board of Governors of the Federal Reserve System). Neither of the Issuers or
any of the Subsidiaries is subject to regulation, or shall become subject to
regulation upon the consummation of the Offering and sale of the Series A Notes
and the application of the net proceeds thereof as described in the Offering
Circular, or the consummation of any of the other Transactions, under the
Investment Company Act of 1940, as amended, and the rules and regulations and
interpretations promulgated thereunder, or under any other Federal or state
statute or regulation limiting its ability to incur or assume indebtedness for
borrowed money.
(hh) No Brokers. Neither of the Issuers nor any of the Subsidiary
Guarantors has dealt with any broker, finder, commission agent or other person
(other than the Initial Purchaser) in connection with the Transactions that has
resulted in either of the Issuers or any of the Subsidiary Guarantors having any
obligation to pay any broker's fee or commission in connection with the
Transactions (other than commissions and fees to the Initial Purchaser as set
forth in the Offering Circular).
(ii) No Labor Disputes. To our knowledge, neither of the Issuers nor
any of the Subsidiaries is engaged in any unfair labor practice. Except as would
not, singly or in the aggregate, have a Material Adverse Effect, there are (i)
no unfair labor practice complaints or other proceedings pending or, to the
knowledge of the Issuers and the Subsidiary Guarantors, threatened against
either of the Issuers or any of the Subsidiaries before the National Labor
Relations Board or any state, local or foreign labor relations board or any
industrial tribunal, and no grievances or arbitration proceedings arising out of
or under any collective bargaining agreement are so pending or, to the knowledge
of the Issuers and the Subsidiary Guarantors, threatened, (ii) no strikes, labor
disputes, slowdowns or stoppages pending or, to the knowledge of the Issuers and
the Subsidiary Guarantors, threatened against either of the Issuers or any of
the Subsidiaries, (iii) no union representation questions existing with respect
to the employees of either of the Issuers or any of the Subsidiaries, and, to
the knowledge of the Issuers and the Subsidiary Guarantors, no union organizing
activities taking place, (iv) to the knowledge of the Company, there is no
threatened or pending liability against the Company, or any of its Subsidiaries
pursuant to the Worker Adjustment Retraining and Notification Act of 1988, as
amended ("WARN"), or any similar state or local law concerning a mass layoff
that, individually
18
or in the aggregate, would reasonably be expected to have a Material Adverse
Effect and (v) no term or condition of employment exists through arbitration
awards, settlement agreements, or side agreement that is contrary to the express
terms of any applicable collective bargaining agreement other than such term or
condition that, individually or in the aggregate, would not reasonably be
expected to have a Material Adverse Effect.
(jj) Environmental Laws. Except as disclosed in the Offering Circular,
or as otherwise would not, singularly or in the aggregate, have a Material
Adverse Effect or otherwise require disclosure in the Offering Circular, (i)
neither of the Issuers nor any of the Subsidiaries has been or is in violation
of any federal, state or local laws and regulations relating to pollution or
protection of human health or the environment, including, without limitation,
laws and regulations relating to emissions, discharges, releases or threatened
releases of toxic or hazardous substances, materials or wastes, or petroleum and
petroleum products ("Materials of Environmental Concern"), or otherwise relating
to the protection of human health and safety, or the use, treatment, storage,
disposal, transport or handling of Materials of Environmental Concern
(collectively, "Environmental Laws"), which violation includes, but is not
limited to, noncompliance with, or lack of, any permits or other environmental
authorizations; (ii) there are no circumstances, either past, present or that
are reasonably foreseeable, that may lead to any such violation in the future;
(iii) neither of the Issuers nor any of the Subsidiaries has received any
communication (written or oral), whether from a Governmental Authority or
otherwise, alleging any such violation; (iv) there is no pending or threatened
claim, action, investigation, notice (written or oral) or other Proceeding by
any person or entity alleging potential liability of either of the Issuers or
any of the Subsidiaries (or against any person or entity for whose acts or
omissions the Issuers or any of the Subsidiaries is or may reasonably be
expected to be liable, either contractually or by operation of law) for
investigatory, cleanup, or other response costs, or natural resources or
property damages, or personal injuries, attorney's fees or penalties relating to
(A) the presence, or release into the environment, of any Materials of
Environmental Concern at any location, or (B) circumstances forming the basis of
any violation or potential violation, of any Environmental Law (collectively,
"Environmental Claims"); and (v) there are no past or present actions,
activities, circumstances, conditions, events or incidents that could reasonably
form the basis of any Environmental Claim.
Each of the Issuers and the Subsidiaries, as appropriate, (i) have
conducted a review of the effect of Environmental Laws on the business,
operations and properties of each of the Issuers and the Subsidiaries, in the
course of which, or as a result of which, the Issuers have identified and
evaluated associated costs and liabilities (including, without limitation, any
capital or operating expenditures required for cleanup, closure of properties or
compliance with Environmental Laws or any permit, license or approval, any
related constraints on operating activities, and any potential liabilities to
third parties); and (ii) have conducted environmental investigations of, and
have reviewed reasonably available information regarding, the business,
properties and operations of each of the Issuers and the Subsidiaries, and of
other properties within the vicinity of their business, properties and
operations, as appropriate for the circumstances of each such property and
operation; on the basis of such reviews, investigations and inquiries, the
Issuers have reasonably concluded that any costs and liabilities associated with
such matters would not have, singularly or in the aggregate, a Material Adverse
Effect or otherwise require disclosure in the Offering Circular.
19
(kk) Representations and Warranties. Each certificate signed by any
officer of any of the Issuers and Subsidiary Guarantors and delivered to the
Initial Purchaser or counsel for the Initial Purchaser in connection with the
Transactions shall be deemed to be a representation and warranty by such Issuers
and Subsidiary Guarantors to the Initial Purchaser as to the matters covered
thereby.
(ll) Authorization of Guarantees of Series A Notes. The Guarantee to be
endorsed on the Series A Notes by each Subsidiary Guarantor has been duly
authorized by each such Subsidiary Guarantor (other than ▇▇▇▇▇) and effective
upon the consummation of the Acquisition, will be duly authorized by ▇▇▇▇▇ and,
on the Closing Date, will have been validly executed and delivered by each such
Subsidiary Guarantor in accordance with the terms of the Indenture. When the
Series A Notes have been issued, executed and authenticated in accordance with
the terms of the Indenture and delivered to and paid for by the Initial
Purchaser in accordance with the terms of this Agreement, the Guarantee of each
Subsidiary Guarantor endorsed on the Series A Notes will be the legal, valid and
binding obligation of each such Subsidiary Guarantor, enforceable against each
such Subsidiary Guarantor in accordance with its terms, except to the extent
that (i) such enforceability may be limited by applicable bankruptcy, insolvency
or similar laws affecting creditors' rights generally and (ii) any rights of
acceleration and the availability of equitable remedies may be subject to
general principles of equity (whether considered in a proceeding in equity or at
law). The Guarantees to be endorsed on the Series A Notes rank and will rank on
a parity with all senior Indebtedness of the Subsidiary Guarantors that is
outstanding on the date hereof or that may be incurred hereafter and senior to
all other Indebtedness of the Subsidiary Guarantors that is outstanding on the
date hereof or that may be incurred hereafter.
(mm) Authorization of Guarantees of Series B Notes. The Guarantee to be
endorsed on the Series B Notes by each Subsidiary Guarantor has been duly
authorized by each such Subsidiary Guarantor (other than ▇▇▇▇▇) and effective
upon the consummation of the Acquisition, will be duly authorized by ▇▇▇▇▇ and,
when the Series B Notes are issued, will have been validly executed and
delivered by each such Subsidiary Guarantor in accordance with the terms of the
Indenture, the Registration Rights Agreement and the Registered Exchange Offer.
When the Series B Notes have been issued, executed and authenticated in
accordance with the terms of the Registered Exchange Offer and the Indenture,
the Guarantee of each Subsidiary Guarantor endorsed on the Series B Notes will
be the legal, valid and binding obligation of each such Subsidiary Guarantor,
enforceable against each such Subsidiary Guarantor in accordance with its terms,
except to the extent that (i) such enforceability may be limited by applicable
bankruptcy, insolvency or similar laws affecting creditors' rights generally and
(ii) any rights of acceleration and the availability of equitable remedies may
be subject to general principles of equity (whether considered in a proceeding
in equity or at law). The Guarantees to be endorsed on the Series B Notes will
rank on a parity with all senior Indebtedness of the Subsidiary Guarantors that
is outstanding on the date hereof or that may be incurred hereafter and senior
to all other Indebtedness of the Subsidiary Guarantors that is outstanding on
the date hereof or that may be incurred hereafter.
(nn) 144A Eligibility. Other than the Existing Senior Secured Notes (as
defined in the Offering Circular), there are no securities of any Issuer or
Guarantor registered under the
20
Exchange Act or listed on a national securities exchange registered under
Section 6 of the Exchange Act or quoted in a United States automated
inter-dealer quotation system.
7. Representations and Warranties of the Initial Purchaser. As of the
date hereof, the Initial Purchaser, represents and warrants to the Issuers and
the Subsidiary Guarantors that:
(a) QIB or Accredited Investor. It is a QIB, with such knowledge and
experience in financial and business matters as is necessary in order to
evaluate the merits and risks of an investment in the Series A Notes, and it
will offer the Series A Notes for resale only upon the terms and conditions set
forth in this agreement and the Offering Circular.
(b) Eligible Purchasers. It (i) is not acquiring the Series A Notes
with a view to any distribution thereof or with any present intention of
offering or selling any of the Series A Notes in a transaction that would
violate the Act or the securities laws of any state of the United States or any
other applicable jurisdiction, and (ii) will be soliciting offers for the Series
A Notes only from, and will be reoffering and reselling the Series A Notes only
to, (A) persons in the United States whom it reasonably believes to be (x) QIBs
in reliance on the exemption from the registration requirements of the Act
provided by Rule 144A under the Act, or (y) Accredited Investors that execute
and deliver to each of the Issuers and the Initial Purchaser a letter containing
certain representations and agreements in the form attached as Annex A to the
Offering Circular or (B) non-U.S. persons reasonably believed by the Initial
Purchaser to be a purchaser referred to in Regulation S under the Act; provided,
however, that in purchasing such Notes, such persons are deemed to have
represented and agreed as provided under the caption "Notice to Investors"
contained in the Offering Circular.
(c) No General Solicitation. No form of general solicitation or general
advertising in violation of the Act has been or will be used by the Initial
Purchaser or any of its representatives in connection with the offer and sale of
any of the Series A Notes pursuant hereto, including but not limited to,
articles, notices or other communications published in any newspaper, magazine
or similar medium or broadcast over television or radio, or any seminar or
meeting whose attendees have been invited by any general solicitation or general
advertising.
(d) Power and Authority. It has all requisite power and authority to
enter into, deliver and perform its obligations under this Agreement and the
Registration Rights Agreement and each of this Agreement and the Registration
Rights Agreement has been duly and validly authorized by it.
8. Indemnification. (a) Indemnification of Initial Purchaser. Each of
the Issuers and the Subsidiary Guarantors shall, jointly and severally, without
limitation as to time, indemnify and hold harmless the Initial Purchaser and
each person, if any, who controls (within the meaning of Section 15 of the Act
or Section 20(a) of the Exchange Act) the Initial Purchaser (any of such persons
being hereinafter referred to as a "Controlling Person"), and the respective
officers, directors, partners, employees, representatives and agents of the
Initial Purchaser and any such Controlling Person (collectively, the "Purchaser
Indemnified Parties"), to the fullest extent lawful, from and against any and
all losses, claims, damages, liabilities, costs (including, without limitation,
costs of preparation and reasonable attorneys' fees) and expenses including,
without limitation, costs and expenses incurred in connection with
investigating, preparing,
21
pursuing or defending against any of the foregoing (collectively, "Losses"), as
incurred, directly or indirectly caused by, related to, based upon, arising out
of or in connection with (i) any untrue statement or alleged untrue statement of
a material fact contained in the Preliminary Offering Circular or the Offering
Circular (or any amendment or supplement thereto) or (ii) any omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, that neither of the
Issuers nor any Subsidiary Guarantor shall be liable under the indemnity
provided in this Section 8(a) to any Purchaser Indemnified Party for any Losses
that (A) result solely from an untrue statement of a material fact contained in,
or the omission of a material fact from, any Preliminary Offering Circular,
which untrue statement or omission was corrected in the Offering Circular (as
then amended or supplemented) if it shall have been determined by a court of
competent jurisdiction by final and nonappealable judgment that (1) such
Purchaser Indemnified Party sold the Notes to the person alleging such Loss and
failed to send or give, at or prior to the written confirmation of such sale, a
copy of the Offering Circular (as then amended or supplemented), if required by
law to have so delivered it, and (2) the Issuers had previously furnished copies
of the corrected Offering Circular to such Purchaser Indemnified Party within a
reasonable amount of time prior to such sale or such confirmation, and (3) the
corrected Offering Circular, if delivered, would have been a complete defense
against the person asserting such Loss; or (B) are based on an untrue statement
or omission or alleged untrue statement or omission made in reliance on and in
conformity with the Furnished Information. The parties hereto agree that the
only information furnished in writing to the Issuers by the Initial Purchaser
specifically for inclusion in the Preliminary Offering Circular or the Offering
Circular is the Furnished Information. The Issuers shall notify the Initial
Purchaser promptly of the institution, threat or assertion of any Proceeding of
which either of the Issuers or any Subsidiary is aware in connection with the
matters addressed by this Agreement which involves either of the Issuers, any of
the Subsidiaries or any of the Purchaser Indemnified Parties.
(b) Actions Against Parties; Notification. If any Proceeding shall be
brought or asserted against any person entitled to indemnification hereunder (an
"Indemnified Party"), such Indemnified Party shall give prompt written notice to
the party or parties from which such indemnification is sought (the
"Indemnifying Parties") in writing; provided, that the failure to so notify the
Indemnifying Parties shall not relieve the Indemnifying Parties from any
obligation or liability except to the extent (but only to the extent) that it
shall be finally determined by a court of competent jurisdiction (which
determination is not subject to appeal) that the Indemnifying Parties have been
prejudiced materially by such failure.
(c) Actions Against Parties; Procedure and Conditions. The Indemnifying
Parties shall have the right, exercisable by giving written notice to an
Indemnified Party, within 20 Business Days after receipt of written notice from
such Indemnified Party of such Proceeding, to assume, at their expense, the
defense of any such Proceeding; provided, that an Indemnified Party shall have
the right to employ separate counsel in any such Proceeding and to participate
in the defense thereof, but the fees and expenses of such counsel shall be at
the expense of such Indemnified Party or parties unless: (i) the Indemnifying
Parties have agreed to pay such fees and expenses; (ii) the Indemnifying Parties
shall have failed promptly to assume the defense of such Proceeding or shall
have failed to employ counsel reasonably satisfactory to such Indemnified Party;
or (iii) the named parties to any such Proceeding (including any impleaded
22
parties) include both such Indemnified Party and one or more Indemnifying
Parties (or any affiliates or controlling persons of any of the Indemnifying
Parties), and such Indemnified Party shall have been advised by counsel that
there may be one or more defenses available to such Indemnified Party that are
in addition to, or in conflict with, those defenses available to the
indemnifying party or such affiliate or controlling person (in which case, if
such Indemnified Party notifies the Indemnifying Parties in writing that it
elects to employ separate counsel at the expense of the Indemnifying Parties,
the Indemnifying Parties shall not have the right to assume the defense thereof
and the reasonable fees and expenses of such counsel shall be at the expense of
the Indemnifying Parties; it being understood, however, that, the Indemnifying
Parties shall not, in connection with any one such Proceeding or separate but
substantially similar or related Proceedings in the same jurisdiction, arising
out of the same general allegations or circumstances, be liable for the fees and
expenses of more than one separate firm of attorneys (together with appropriate
local counsel) at any time for such Indemnified Party).
No Indemnifying Party shall, without the prior written consent of the
Indemnified Party, consent to entry of any judgment in or enter into any
settlement of any pending or threatened Proceeding in respect of which
indemnification or contribution may be sought hereunder (whether or not any
Indemnified Party is a party thereto) unless such judgment or settlement
includes, as an unconditional term thereof, the giving by the claimant or
plaintiff to each Indemnified Party of a release, in form and substance
satisfactory to the Indemnified Party, from all Losses that may arise from such
Proceeding or the subject matter thereof (whether or not any Indemnified Party
is a party thereto).
(d) Indemnification of the Issuers and the Subsidiary Guarantors. The
Initial Purchaser agrees to indemnify and hold harmless each of the Issuers and
the Subsidiary Guarantors and each of their controlling persons and their
respective members, managers, officers, directors, partners, employees and
representatives to the same extent as the foregoing indemnity from the Issuers
and the Subsidiary Guarantors to each of the Purchaser Indemnified Parties
stated in Section 8(a), but only with respect to Losses that are caused by an
untrue statement or omission or alleged untrue statement or omission made in
reliance on and in conformity with the Furnished Information. The parties hereto
agree that the only information furnished in writing to the Issuers by the
Initial Purchaser specifically for inclusion in the Preliminary Offering
Circular or the Offering Circular is the Furnished Information. Notwithstanding
the foregoing, any liability of the Initial Purchaser hereunder shall be limited
to an amount not to exceed the total discounts, commissions and other
compensation received by the Initial Purchaser under this Agreement, less the
aggregate amount of any damages that the Initial Purchaser has otherwise been
required to pay by reason of the untrue or alleged untrue statements or the
omissions or alleged omissions to state a material fact (the "Aggregate
Discount").
(e) Contribution. If the indemnification provided for in this Section 8
is unavailable to an Indemnified Party or is insufficient to hold such
Indemnified Party harmless for any Losses in respect of which this Section 8
would otherwise apply by its terms (other than by reason of exceptions provided
in this Section 8), then each Indemnifying Party, in lieu of indemnifying such
Indemnified Party, shall contribute to the amount paid or payable by such
Indemnified Party as a result of such Losses (i) in such proportion as is
appropriate to reflect the relative benefits received by the Issuers and the
Subsidiaries, on the one hand, and the Initial Purchaser,
23
on the other hand, from the Offering or (ii) if the allocation provided by
clause (i) above is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause (i)
above but also the relative fault of the Issuers and the Subsidiaries, on the
one hand, and the Initial Purchaser, on the other hand, in connection with the
actions, statements or omissions that resulted in such Losses, as well as any
other relevant equitable considerations. The relative benefits received by the
Issuers and the Subsidiaries, on the one hand, and the Initial Purchaser, on the
other hand, shall be deemed to be in the same proportion as the total net
proceeds from the Offering (before deducting expenses) received by the Issuers,
on the one hand, and the total discounts and commissions received by the Initial
Purchaser, on the other hand, bear to the total price of the Series A Notes in
Exempt Resales as set forth on the cover page of the Offering Circular. The
relative fault of the Issuers and the Subsidiaries, on the one hand, and the
Initial Purchaser, on the other hand, shall be determined by reference to, among
other things, whether any untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the Issuers or any Subsidiary, on the one hand, or the Initial
Purchaser, on the other hand, and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. The amount paid or payable by an Indemnified Party as a result of any
Losses shall be deemed to include any legal or other fees or expenses incurred
by such party in connection with any Proceeding, to the extent such party would
have been indemnified for such fees or expenses if the indemnification provided
for in this Section 8 was available to such party.
Each party hereto agrees that it would not be just and equitable if
contribution pursuant to this Section 8(e) were determined by pro rata
allocation or by any other method of allocation that does not take account of
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 8(e), the Initial Purchaser shall
not be required to contribute, in the aggregate, any amount in excess of the
Aggregate Discount. No person guilty of fraudulent misrepresentation (within the
meaning of Section 11(f) of the Act) shall be entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
(f) Nonexclusive Remedy. The indemnity and contribution agreements
contained in this Section 8 are in addition to any liability that any of the
Issuers, the Subsidiary Guarantors or the Initial Purchaser may otherwise have
to the Indemnified Parties, and does not limit in any way rights or remedies
which may otherwise be available at law or in equity.
9. Conditions. (a) Conditions to Obligations of Initial Purchaser. The
obligations of the Initial Purchaser to purchase the Series A Notes under this
Agreement are subject to the satisfaction or waiver of each of the following
conditions:
(i) Representations and Warranties of the Issuers and the
Subsidiary Guarantors. All the representations and warranties of each
of the Issuers and the Subsidiary Guarantors in this Agreement shall be
true and correct in all material respects (other than representations
and warranties with a Material Adverse Effect qualifier or other
materiality qualifier, which shall be true and correct as written) at
and as of the Closing Date after giving effect to the Transactions with
the same force and effect as if made on and as of such date. On or
prior to the Closing Date, each of the Issuers and the
24
Subsidiary Guarantors shall have performed or complied in all material
respects with all of the agreements and satisfied in all material
respects all conditions on their respective parts to be performed,
complied with or satisfied on or prior to the Closing Date pursuant to
this Agreement.
(ii) Availability of Offering Circular. The Offering Circular
shall have been printed and copies made available to the Initial
Purchaser not later than 12:00 noon, New York City time, on the second
Business Day following the date of this Agreement or at such later date
and time as the Initial Purchaser may approve.
(iii) No Injunction. No injunction, restraining order or order
of any nature by a Governmental Authority shall have been issued as of
the Closing Date that would prevent or interfere with the issuance and
sale of the Series A Notes or the consummation of any of the other
transactions contemplated by the Documents; and no stop order
suspending the qualification or exemption from qualification of any of
the Series A Notes in any jurisdiction shall have been issued and no
Proceeding for that purpose shall have been commenced or be pending or
contemplated.
(iv) No Proceedings. No action shall have been taken and no
Applicable Law shall have been enacted, adopted or issued that would,
as of the Closing Date, prevent the issuance and sale of the Series A
Notes or the consummation of any of the other Transactions. No
Proceeding shall be pending or threatened other than Proceedings that
(A) if adversely determined would not, singly or in the aggregate,
adversely affect the issuance or marketability of the Series A Notes,
and (B) would not, singly or in the aggregate, have a Material Adverse
Effect.
(v) No Material Adverse Change. Since the date as of which
information is given in the Offering Circular (without giving effect to
any amendment thereto or supplement thereto), there shall not have been
any Material Adverse Change the effect of which, in the sole judgment
of the Initial Purchaser, makes it impractical or inadvisable to
proceed with the completion of the Offering or the purchase and sale of
the Notes.
(vi) PORTAL. The Notes shall have (A) been designated PORTAL
securities in accordance with the rules and regulations adopted by the
NASD relating to trading in the PORTAL market, and (B) received a
rating of "B-" and "B3" from Standard & Poor's Corporation and ▇▇▇▇▇'▇
Investors Services, Inc., respectively.
(vii) Maintenance of Rating. As of the Closing Date, (i) there
shall not have occurred any downgrading, suspension or withdrawal of,
nor shall any notice have been given of any potential or intended
downgrading, suspension or withdrawal of, or of any review (or of any
potential or intended review) for a possible change that does not
indicate the direction of the possible change in, any rating of any
securities of either of the Issuers (including, without limitation, the
placing of any of the foregoing ratings on credit watch with negative
or developing implications or under review with an uncertain direction)
by any "nationally recognized statistical rating organization" as such
term is defined for purposes of Rule 436(g)(2) under the Act, (ii)
there shall not have occurred any change, nor shall any notice have
been given of any potential or intended change, in
25
the outlook for any rating of any securities of either of the Issuers
by any such rating organization and (iii) no such rating organization
shall have given notice that it has assigned (or is considering
assigning) a lower rating to the Notes than that on which the Notes
were marketed.
(viii) Officers', Secretary's and Solvency Certificates. The
Initial Purchaser shall have received on the Closing Date (A)
certificates dated the Closing Date, signed by (1) the President and
Chief Executive Officer, and (2) the principal financial or accounting
officer of each of the Issuers and Subsidiary Guarantors, on behalf of
such Issuer or Subsidiary Guarantor, confirming the matters set forth
in paragraphs (i), (iii), (iv), (v), (vii) and (xii) of this Section
9(a), (B) a certificate, dated the Closing Date, signed by the
principal financial or accounting officer of the Company, on behalf of
the Issuers and the Subsidiary Guarantors, stating that certain data
identified by the Initial Purchaser and included in the Offering
Circular has been reviewed by such persons and, to the best knowledge
of such persons, subject to the risks and limitations described in the
Preliminary Offering Circular and the Offering Circular, is true and
accurate in all material respects and is based on or derived from
sources which the Company believes to be reliable and accurate, which
certificate shall be in form and substance satisfactory to counsel for
the Initial Purchaser, (C) a certificate, dated the Closing Date,
signed by the Secretary of each of the Issuers and Subsidiary
Guarantors, certifying such matters as the Initial Purchaser may
reasonably request, and (D) a certificate of solvency, dated the
Closing Date, signed by the principal financial or accounting officer
of the Issuers and Subsidiary Guarantors substantially in the form
previously approved by the Initial Purchaser.
(ix) Opinions of Counsel. The Initial Purchaser shall have
received, a favorable opinion (in form and substance satisfactory to
the Initial Purchaser and counsel to the Initial Purchaser), dated the
Closing Date, of each of the following: (A) ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PLLC,
special counsel to the Issuers and Subsidiary Guarantors; (B) ▇▇▇▇▇▇▇
▇▇▇▇▇▇ Winter & Stennis, P.A., special Mississippi counsel to the
Issuers and Subsidiary Guarantors; (C) ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ & ▇'▇▇▇▇▇▇▇ and
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ LLC, special Colorado counsel to the Issuers and
Subsidiary Guarantors; (D) Ice ▇▇▇▇▇▇, special Indiana counsel to the
Issuers and Subsidiary Guarantors; and (E) Mayer, Brown, ▇▇▇▇ & Maw
LLP, special counsel to the Initial Purchaser.
(x) Accountants' Comfort Letters.
(A) The Initial Purchaser shall have received from
Pricewaterhouse Coopers, LLP, independent auditors, with
respect to the Issuers and the Subsidiaries (other than
▇▇▇▇▇), (1) a customary comfort letter, dated the date of the
Offering Circular, in form and substance reasonably
satisfactory to the Initial Purchaser and its counsel, with
respect to the financial statements and certain financial
information of the Issuers and the Subsidiaries contained in
the Offering Circular (the "Pricewaterhouse Comfort Letter"),
and (2) a customary comfort letter, dated the Closing Date, in
form and substance reasonably satisfactory to the Initial
Purchaser and its counsel, to the effect that Pricewaterhouse
Coopers, LLP reaffirms the statements made in the
Pricewaterhouse Comfort Letter.
26
(B) The Initial Purchaser shall have received from
Ernst & Young, LLP, independent auditors, with respect to the
▇▇▇▇▇, (1) a customary comfort letter, dated the date of the
Offering Circular, in form and substance reasonably
satisfactory to the Initial Purchaser and its counsel, with
respect to the financial statements and certain financial
information of ▇▇▇▇▇ contained in the Offering Circular (the
"E&Y Comfort Letter"), and (2) a customary comfort letter,
dated the Closing Date, in form and substance reasonably
satisfactory to the Initial Purchaser and its counsel, to the
effect that Ernst & Young, LLP reaffirms the statements made
in the E&Y Comfort Letter.
(xi) Execution, Delivery and Content of Documents. The
Documents shall have been executed and delivered by all parties thereto
and the Initial Purchaser shall have received a fully executed original
of each Document and all opinions, certificates and other documents
required by the Documents. The terms of each Document shall conform in
all material respects to the description thereof in the Offering
Circular to the extent described therein.
(xii) Consummation of Transactions. Each of the Transactions
shall have been consummated on terms that conform in all material
respects to the description thereof in the Offering Circular.
(xiii) Issuance of Senior Secured Notes and Discount Notes.
The Senior Secured Notes and Discount Notes shall have been issued on
terms that conform in all material respects to the descriptions thereof
in the Offering Circular.
(xiv) Permits. All Permits required to be obtained from, and
all notices or declarations required to be made with, any Gaming
Authority or other Governmental Authority to permit the issuance and
sale of the Series A Notes in accordance with the terms of, and in the
aggregate principal amount set forth in, this Agreement shall have been
obtained and made, in each case free of any conditions other than those
set forth in this Agreement; and all Permits (other than the
Post-Closing Permits) required to be obtained from, and all notices or
declarations required to be made with, any Gaming Authority or other
Governmental Authority to consummate the Transactions contemplated by
the Documents shall have been obtained and made, in each case free of
any conditions other than those set forth in such Documents.
(xv) Additional Documents. Counsel to the Initial Purchaser
shall have been furnished with such documents as they may reasonably
require for the purpose of enabling them to review or pass upon the
matters referred to in this Section 9 and in order to evidence the
accuracy, completeness and satisfaction of the representations,
warranties and conditions contained in this Agreement.
(xvi) The Acquisition. The Acquisition shall have been
consummated concurrently with the Offering pursuant to the terms of the
Stock Purchase Agreement dated November 3, 2005, between the Company
and ▇▇▇▇▇ Entertainment Resort Holdings, L.P.
27
(xvii) Amended Credit Facility. The Amended Credit Facility
shall have been executed and delivered by all parties thereto, and the
Initial Purchaser shall have received a fully executed original of such
document which shall be in form and substance reasonably satisfactory
to the Initial Purchaser.
(b) Conditions to Issuers' and Subsidiary Guarantors' Obligations. The
obligations of the Issuers to sell, and the obligations of the Subsidiary
Guarantors to guarantee, the Series A Notes under this Agreement is subject to
the satisfaction or waiver of each of the following conditions:
(i) Payment. The Initial Purchaser shall have delivered
payment to the Issuers for the Series A Notes pursuant to Sections 2
and 4 of this Agreement and shall have complied with all other
obligations and agreements required to be complied with by it hereunder
on or prior to the Closing Date.
(ii) Representations and Warranties. All of the
representations and warranties of the Initial Purchaser in this
Agreement shall be true and correct in all material respects at and as
of the Closing Date, with the same force and effect as if made on and
as of such date.
(iii) No Injunctions. No injunction, restraining order or
order of any nature by a Governmental Authority shall have been issued
as of the Closing Date that would prevent or interfere with the
issuance and sale of the Series A Notes; and no stop order suspending
the qualification or exemption from qualification of any of the Series
A Notes in any jurisdiction shall have been issued and no Proceeding
for that purpose shall have been commenced or be pending or
contemplated as of the Closing Date.
10. Termination. This Agreement shall become effective upon the
execution and delivery of this Agreement by the parties hereto. The Initial
Purchaser may terminate this Agreement at any time prior to the Closing Date by
written notice to the Issuers if any of the following has occurred:
(a) Material Adverse Effect. Since the date as of which information is
given in the Offering Circular, any Material Adverse Effect or any Material
Adverse Change that would, in the Initial Purchaser's judgment, (i) make it
impracticable or inadvisable to proceed with the Offering or delivery of the
Series A Notes, including the Exempt Resales, on the terms and in the manner
contemplated in the Offering Circular or (ii) materially impair the investment
quality of the Notes.
(b) Failure to Satisfy Conditions. The failure of the Issuers or any of
the Subsidiary Guarantors to satisfy the conditions contained in Section 9(a) on
or prior to the Closing Date.
(c) Outbreak of Hostilities. Any attack on or incidences of terrorism
involving the United States, any outbreak or escalation of hostilities directly
or indirectly involving the United States, any military action or commencement
or declaration of war by or directly or indirectly involving the United States,
any declaration of a national emergency, any other calamity, emergency or crisis
directly or indirectly involving the United States, any material adverse change
in economic conditions in or the financial markets of the United States or
elsewhere or
28
any material adverse change or development involving a prospective change in
national or international political, financial or economic conditions, in each
case the effect of which could make it, in the Initial Purchaser's judgment,
impracticable or inadvisable to market or proceed with the offering or delivery
of the Series A Notes on the terms and in the manner contemplated in the
Offering Circular or to enforce contracts for the sale of any of the Series A
Notes.
(d) Suspension of Trading. The suspension or limitation of trading
generally in securities on the New York Stock Exchange, the American Stock
Exchange or the Nasdaq National Market or any setting of limitations on prices
for securities on any such exchange or on the Nasdaq National Market.
(e) Enactment of Adverse Law. The enactment, publication, decree or
other promulgation after the date hereof of any Applicable Law that in the
Initial Purchaser's opinion materially and adversely affects, or could
materially and adversely affect, the properties, business, prospects, result of
operations, earnings, assets, liabilities or condition (financial or otherwise)
of either of the Issuers or any of the Subsidiaries.
(f) Downgrade of Securities. On or after the date hereof, (i) there
shall not have occurred any downgrading, suspension or withdrawal of, nor shall
any notice have been given of any potential or intended downgrading, suspension
or withdrawal of, or of any review (or of any potential or intended review) for
a possible change that does not indicate the direction of the possible change
in, any rating of the Issuers or any of the Subsidiary Guarantors or any
securities of the Issuers or any of the Subsidiary Guarantors (including,
without limitation, the placing of any of the foregoing ratings on credit watch
with negative or developing implications or under review with an uncertain
direction) by any "nationally recognized statistical rating organization" as
such term is defined for purposes of Rule 436(g)(2) under the Act, (ii) there
shall not have occurred any adverse change, nor shall any notice have been given
of any potential or intended adverse change, in the outlook for any rating of
Issuers or the Subsidiary Guarantors or any securities of Issuers or the
Subsidiary Guarantors (by any such rating organization and (iii) no such rating
organization shall have given notice that it has assigned (or is considering
assigning) a lower rating to the Notes than that on which the Notes were
marketed.
(g) Banking Moratorium. The declaration of a banking moratorium by any
Governmental Authority; or the taking of any action by any Governmental
Authority after the date hereof in respect of its monetary or fiscal affairs
that in the Initial Purchaser's opinion could have a material adverse effect on
the financial markets in the United States or elsewhere.
The respective indemnities, contribution and expense reimbursement
provisions and agreements, and representations, warranties and other statements
of the Issuers and the Subsidiary Guarantors and the Initial Purchaser set forth
in or made pursuant to this Agreement shall remain operative and in full force
and effect, and will survive, regardless of (i) any investigation, or statement
as to the results thereof, made by or on behalf of the Initial Purchaser or any
of the Issuers or Subsidiary Guarantors, or any of their respective officers,
directors, members or managers or any of their respective controlling persons,
(ii) acceptance of the Notes, and payment for them hereunder, and (iii) any
termination of this Agreement (including, without limitation, any termination
pursuant to this Section 10). Without limiting the foregoing, notwithstanding
any termination of this Agreement, the Issuers and the Subsidiary Guarantors
29
shall be and shall remain jointly and severally liable (i) for all expenses that
they have agreed to pay pursuant to Section 5(f), and (ii) pursuant to Section
8.
11. Miscellaneous. (a) Notices. Notices given pursuant to any provision
of this Agreement shall be addressed as follows: (i) if to any of the Issuers
and Subsidiary Guarantors, to ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇
▇▇▇▇▇, facsimile number (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Chief Financial Officer, with
a copy to ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇, facsimile number
(▇▇▇) ▇▇▇-▇▇▇▇, Attention: Chief Financial Officer, and an additional copy to
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ PLLC, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇, facsimile
number (▇▇▇) ▇▇▇-▇▇▇▇, Attention: Jin-▇▇▇ ▇▇▇, Esq. and (ii) if to the Initial
Purchaser, to ▇▇▇▇▇▇▇▇▇ & Company, Inc., ▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention: ▇▇▇▇▇ Fellder, Esq., with a copy to Mayer,
Brown, ▇▇▇▇ & Maw LLP, ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, Attention:
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq. (provided, that any notice pursuant to Section 8 will be
mailed, delivered, telegraphed or sent by facsimile and confirmed to the party
to be notified and its counsel), or in any case to such other address as the
person to be notified may have requested in writing.
(b) Successors and Assigns. This Agreement has been and is made solely
for the benefit of and shall be binding upon each of the Issuers, the Subsidiary
Guarantors, the Initial Purchaser and, to the extent provided in Section 8, the
controlling persons, officers, directors, partners, employees, representatives
and agents referred to in Section 8, and their respective heirs, executors,
administrators, successors and assigns, all as and to the extent provided in
this Agreement, and no other person shall acquire or have any right under or by
virtue of this Agreement. The term "successors and assigns" shall not include a
purchaser of any of the Series A Notes from the Initial Purchaser merely because
of such purchase. Notwithstanding the foregoing, it is expressly understood and
agreed that each purchaser who purchases Series A Notes from the Initial
Purchaser is intended to be a beneficiary of the Issuers' covenants contained in
the Registration Rights Agreement to the same extent as if the Series A Notes
were sold and those covenants were made directly to such purchaser by each of
the Issuers, and each such purchaser shall have the right to take action against
each of the Issuers to enforce, and obtain damages for any breach of, those
covenants.
(c) GOVERNING LAW. THIS AGREEMENT SHALL BE CONSTRUED AND INTERPRETED,
AND THE RIGHTS OF THE PARTIES SHALL BE DETERMINED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, INCLUDING, WITHOUT LIMITATION, SECTIONS 5-1401 AND 5-1402
OF THE NEW YORK GENERAL OBLIGATIONS LAWS AND RULE 327(b) OF THE NEW YORK CIVIL
PRACTICE LAWS AND RULES. EACH OF THE ISSUERS AND SUBSIDIARY GUARANTORS HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, AND IRREVOCABLY
ACCEPTS FOR ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND
UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS. EACH OF THE ISSUERS AND
SUBSIDIARY GUARANTORS IRREVOCABLY WAIVES, TO THE FULLEST EXTENT IT MAY
EFFECTIVELY DO SO UNDER APPLICABLE LAW, TRIAL
30
BY JURY AND ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE LAYING OF THE
VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT AND ANY
CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDINGS BROUGHT IN SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. EACH OF THE ISSUERS AND SUBSIDIARY GUARANTORS
IRREVOCABLY CONSENTS, TO THE FULLEST EXTENT IT MAY EFFECTIVELY DO SO UNDER
APPLICABLE LAW, TO THE SERVICE OF PROCESS OF ANY OF THE AFOREMENTIONED COURTS IN
ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY REGISTERED OR
CERTIFIED MAIL, POSTAGE PREPAID, TO SUCH ISSUER OR SUCH SUBSIDIARY GUARANTOR, AS
THE CASE MAY BE, AT THE ADDRESS SET FORTH HEREIN, SUCH SERVICE TO BECOME
EFFECTIVE 30 DAYS AFTER SUCH MAILING. NOTHING HEREIN SHALL AFFECT THE RIGHT OF
THE INITIAL PURCHASER TO SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR
TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE PROCEED AGAINST ANY OF THE ISSUERS
AND SUBSIDIARY GUARANTORS IN ANY OTHER JURISDICTION.
(d) Counterparts. This Agreement may be signed in various counterparts
which together shall constitute one and the same instrument.
(e) Headings. The Headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the meaning hereof. When
a reference is made in this Agreement to a Section, paragraph, subparagraph,
Schedule or Exhibit, such reference shall mean a Section, paragraph,
subparagraph, Schedule or Exhibit to this Agreement unless otherwise indicated.
(f) Interpretation. The words "include," "includes," and "including"
when used in this Agreement shall be deemed in each case to be followed by the
words "without limitation." The phrases "the date of this agreement," "the date
hereof," and terms of similar import, unless the context otherwise requires,
shall be deemed to refer to December 16, 2005. The words "hereof," "herein,"
"herewith," "hereby" and "hereunder" and words of similar import shall, unless
otherwise stated, be construed to refer to this Agreement as a whole and not to
any particular provision of this Agreement. The phrase "to the knowledge of the
issuers and the guarantors" means the actual knowledge, after due inquiry, of
each of ▇▇▇ ▇. ▇▇▇▇▇▇ and ▇▇▇ ▇▇▇▇▇▇▇. Unless the context otherwise requires,
defined terms shall include the singular and plural and the conjunctive and
disjunctive forms of the terms defined.
(g) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their best efforts to find and employ an alternative means to
achieve the same or substantially the same result as that contemplated by such
term, provision, covenant or restriction. It is hereby stipulated and declared
to be the intention of the parties that they would have executed the remaining
terms, provisions, covenants and restrictions without including any of such that
may be hereafter declared invalid, illegal, void or unenforceable.
31
(h) Amendment. This Agreement may be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may be given,
provided that the same are in writing and signed by each of the signatories
hereto.
12. ▇▇▇▇▇ Execution. On the Closing Date, effective upon the
consummation of the Acquisition, (the Company will cause ▇▇▇▇▇ to become a party
to this Agreement (as a Subsidiary Guarantor) by executing and delivering this
Agreement to the Initial Purchaser and executing and delivering the Guarantees,
the Registration Rights Agreement and the Indenture and any other Document to
which ▇▇▇▇▇ is to become a party. By executing and delivering this Agreement,
▇▇▇▇▇ expressly agrees (A) to take any and all actions required to be taken by a
Subsidiary Guarantor under this Agreement or any other Document to which it
becomes a party and (B) that all representations and warranties made in this
Agreement by the Company on behalf of ▇▇▇▇▇ shall be considered to be effective
as to, and binding upon, ▇▇▇▇▇ as of the consummation of the Acquisition.
[signature pages follow this page]
32
Please confirm that the foregoing correctly sets forth the agreement
among the Issuers, the Subsidiary Guarantors and the Initial Purchaser.
Very truly yours,
THE MAJESTIC STAR CASINO, LLC
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
MAJESTIC STAR CASINO CAPITAL CORP. II
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
MAJESTIC INVESTOR, LLC
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
MAJESTIC INVESTOR HOLDINGS, LLC
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
Senior Notes Purchase Agreement
S-1
MAJESTIC INVESTOR CAPITAL CORP.
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
▇▇▇▇▇▇ MISSISSIPPI GAMING, LLC
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
▇▇▇▇▇▇ COLORADO GAMING, LLC
By:
---------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
Senior Notes Purchase Agreement
S-2
ACCEPTED AND AGREED TO:
▇▇▇▇▇▇▇▇▇ & COMPANY, INC.
By:
--------------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: Managing Director
Senior Notes Purchase Agreement
S-3
Accepted and Agreed to as of the 21st day of December, 2005:
THE MAJESTIC STAR CASINO II, INC., (f.k.a. ▇▇▇▇▇
Indiana, Inc.)
By:
------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
▇▇▇▇▇▇▇▇▇▇ HARBOR PARKING ASSOCIATES, LLC
By:
------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
▇▇▇▇▇▇▇▇▇▇ HARBOR RIVERBOATS, L.L.C.
By:
------------------------------------------
Name: ▇▇▇ ▇▇▇▇▇▇▇
Title: Vice President and Chief Financial Officer
Senior Notes Purchase Agreement
S-4