Exhibit (d)(2)
--------------
================================================================================
VOTING AND CONTRIBUTION AGREEMENT
by
and
among
PH CASINO RESORTS, INC.
and
THE STOCKHOLDERS SIGNATORY HERETO
Dated as of April 17, 2000
================================================================================
VOTING AND CONTRIBUTION AGREEMENT
VOTING AND CONTRIBUTION AGREEMENT (this "Agreement"), dated as of
April 17, 2000, by and among PH Casino Resorts, Inc., a Delaware corporation
(together with its assignees or designees,"PHCR"), and the other signatories
hereto (together with any Additional Stockholders, the "Stockholders").
W I T N E S S E T H
WHEREAS, concurrently with the execution and delivery of this
Agreement, Pinnacle Entertainment, Inc., a Delaware corporation ("Pinnacle") is
entering into an agreement and plan of merger, dated as of the date hereof (the
"Merger Agreement"), with Pinnacle Acquisition Corporation, a Delaware
corporation ("Pinnacle Acq Corp"), pursuant to which Pinnacle Acq Corp shall
merge with and into Pinnacle (the "Merger"), upon the terms and conditions set
forth therein;
WHEREAS, each Stockholder severally desires that the Pinnacle Acq Corp
and Pinnacle enter into the Merger Agreement;
WHEREAS, concurrently with the execution and delivery of this
Agreement, Harveys Casino Resorts, a Nevada corporation ("Harveys") is entering
into an agreement and plan of merger, dated as of the date hereof (the "Harveys
Merger Agreement"), with Harveys Acquisition Corporation, a Nevada corporation
("Harveys Acq Corp"), pursuant to which Harveys Acq Corp shall merge with and
into Harveys (the "Harveys Merger") upon the terms and conditions set forth
therein;
WHEREAS, each Stockholder severally desires that Harveys and Harveys
Acq Corp enter into the Harveys Merger Agreement;
WHEREAS, concurrently with the execution and delivery of this
Agreement, PHCR and the Stockholders are entering into a Memorandum of
Understanding (the "MOU"), which sets forth certain principal terms with respect
to incentive equity and other employment matters related to the Merger and the
Harveys Merger;
WHEREAS, the Stockholders own beneficially and of record and have the
sole power to vote and dispose of the number of shares of common stock, par
value $.10 per share, of Pinnacle ("Pinnacle Common Stock") set forth under the
caption "Shares Owned," opposite their respective names on Schedule I hereto
(such shares of Pinnacle Common Stock owned by the Stockholders or acquired or
otherwise received after the date hereof being the "Shares");
WHEREAS, opposite each Stockholder's name on Schedule II under the
caption "Options Owned" is (i) the number of shares of Pinnacle Common Stock
acquirable pursuant to employee stock options owned by the Stockholders (the
"Options") and (ii) the exercise price of each such Option (the "Exercise
Price");
1
WHEREAS, each Stockholder severally desires to contribute its shares
of Pinnacle Common Stock to PHCR as part of a transaction that, together with
the Merger and the Harveys Merger, is intended to qualify as exchanges under
section 351 of the Internal Revenue Code of 1986, as amended;
WHEREAS, as a condition to its willingness to enter into the Merger
Agreement, PHCR has requested that the Stockholders enter into this Agreement;
and
WHEREAS, from time to time prior to the consummation of the Merger,
additional Stockholders may be joined as signatories to this Agreement either in
substitution of or in addition to, the Stockholders, in each case subject to the
terms and conditions herein described.
NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties and agreements contained herein, and for other good
and valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto, intending to be legally bound, agree as
follows:
ARTICLE I
DEFINITIONS
SECTION 1.01. Certain capitalized terms used and not otherwise
defined herein have the meanings ascribed to them in the Merger Agreement.
Unless the context otherwise requires, such terms shall include the singular and
plural and the conjunctive and disjunctive forms of the terms defined.
ARTICLE II
VOTING AGREEMENTS
SECTION 2.01. Stockholder Meetings. Each Stockholder agrees that at
any meeting of stockholders of Pinnacle called to vote upon the Merger or the
Merger Agreement, or at any adjournment thereof, or in any other circumstances
upon which a vote, consent or other approval of the stockholders of Pinnacle
with respect to the Merger, the Merger Agreement or any of the other
transactions contemplated thereby or hereby is sought, such Stockholder shall
cause its Shares to be present for quorum purposes and to vote (or caused to be
voted) its Shares in favor of the terms thereof and each of the other
transactions contemplated by the Transaction and this Agreement and any actions
required in furtherance thereof and hereof. Each Stockholder hereby grants to
PHCR a proxy to vote all of the Shares then beneficially owned by such
Stockholder as indicated in this Section 2.01. Each Stockholder agrees that
this proxy shall be irrevocable and coupled with an interest, agrees to take
such further action or execute such other instruments as may
2
be necessary to effectuate the intent of this proxy and hereby revokes any proxy
previously granted by such Stockholder with respect to any of the Shares.
SECTION 2.02. Competing Transaction. Subject to the provisions of
Article VI, each Stockholder agrees that at any meeting of stockholders of
Pinnacle, or at any adjournment thereof, or in any other circumstances upon
which their vote, consent or other approval is sought, such Stockholder shall
vote (or cause to be voted) its Shares against (i) any Takeover Proposal and
(ii) any amendment of Pinnacle's Certificate of Incorporation or Bylaws or other
proposal or transaction involving Pinnacle or any of its subsidiaries which
amendment or other proposal or transaction would in any manner impede, interfere
with, materially delay, frustrate, prevent or nullify or result in a breach of
any covenant, representation or warranty or any other obligation or agreement of
Pinnacle or any Stockholder under or with respect to, the Merger, the Merger
Agreement or any of the other transactions contemplated by the Merger
Agreement or by this Agreement.
ARTICLE III
CONTRIBUTION
SECTION 3.01. Contribution of Shares by Stockholders. Each
Stockholder agrees that immediately prior to the effective time of the Merger
(the "Effective Time"), each such Stockholder shall contribute the number of
Shares listed opposite such Stockholder's name under the caption "Shares
Contributed" on Schedule I hereto (and, to the extent that the Options Exchanged
(as defined below) are exercised prior to the Effective Time, each such
Stockholder also shall contribute such Shares received upon such exercise), to
PHCR. PHCR shall issue to each contributing Stockholder, a number of shares of
PHCR's Class A Common Stock, par value $.01 per share (the "PHCR Class A Common
Stock"), equal to the product of (A) the Merger Consideration, (B) divided by
45.77707, (C) multiplied by .009901 (the foregoing calculation, the "Class A
Conversion Ratio"), and a number of shares of PHCR's Class B Common Stock, par
value $.01 per share (the "PHCR Class B Common Stock" and, together with the
PHCR Class A Common Stock, the "PHCR Common Stock"), equal to the product of
(A) the Merger Consideration, (B) divided by 45.77707, (C) multiplied by .990099
(the foregoing calculation, the "Class B Conversion Ratio"), for each Share
contributed.
SECTION 3.02. Termination of Options by Stockholders. Each
Stockholder agrees that immediately prior to the Effective time, the Options
listed opposite such Stockholder's name under the caption "Options Exchanged" on
Schedule I hereto shall be cancelled, except to the extent that the Options
Exchanged are exercised prior to the Effective Time, in which case such
Stockholder also shall contribute to PHCR in accordance with Section 3.01 the
Shares received upon such exercise. In connection with such cancellation, PHCR
shall issue to such Stockholder one or more fully vested options to acquire (i)
a number of shares of PHCR Class A Common Stock equal to the number of shares of
Pinnacle Common Stock issuable upon exercise of such Options, multiplied by the
Class A Conversion Ratio, and (ii) a number of shares of PHCR Class B Common
3
Stock equal to the number of shares of Pinnacle Common Stock issuable upon
exercise of such Options, multiplied by the Class B Conversion Ratio, in each
case subject to the restrictions set forth in an option agreement to be entered
into between the parties. With respect to each Stockholder, the exercise price
of each option issued to purchase PHCR Common Stock shall be set at an amount so
that the aggregate value of all such options will, as of the Effective Time, be
equal to (i) the product of (a) the cash amount of the Pinnacle Merger
Consideration multiplied by (b) the aggregate number of Shares which may be
acquired upon exercise of the Options contributed by such Stockholder, minus
(ii) the aggregate Exercise Price of such Options.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
SECTION 4.01. Representations and Warranties of the Stockholders.
Each of the Stockholders severally and not jointly represents and warrants to
Pinnacle Acq Corp as follows:
(a) Power, Organization and Standing. Such Stockholder has all
requisite power and authority to enter into and perform its obligations
under this Agreement and, if such Stockholder is not a natural person, such
Stockholder is duly organized, validly existing and in good standing under
the laws of its state of organization.
(b) Authority and Capacity. The execution and delivery of this
Agreement, and the performance by such Stockholder of its obligations
hereunder, have been duly authorized by all necessary action on the part of
such Stockholder. This Agreement has been duly executed and delivered by
such Stockholder and, assuming the due execution and delivery hereof by
PHCR and assuming that approval of this Agreement by Pinnacle remains
effective, this Agreement constitutes a legal, valid and binding obligation
of such Stockholder, enforceable against such Stockholder in accordance
with its terms.
(c) Ownership. Such Stockholder is the record and beneficial
owner of, and has good and valid title to, the number of Shares and Options
listed opposite such Stockholder's name under the captions "Shares Owned"
and "Options Owned," respectively on Schedule I hereto, free and clear of
all Liens or other adverse interests (including any restrictions on the
right to vote, sell or otherwise dispose of such Shares and Options).
Except for this Agreement, there are no outstanding warrants,
subscriptions, rights (including preemptive rights), options, calls,
commitments or other agreements or Liens or other adverse interests to
encumber, purchase or acquire any of the Shares or Options of such
Stockholder or securities convertible into or exchangeable for the Shares
of such Stockholder. Except as indicated in Schedule I, neither such
Stockholder nor any of its affiliates or associates (as such terms are
defined in Rule 12b-2 promulgated under the Exchange Act) holds either of
record or beneficially any securities, capital stock, warrants,
subscriptions, rights (including preemptive rights), options, calls,
commitments or other instruments of
4
Pinnacle or any of Pinnacle's direct or indirect subsidiaries other than
such Stockholder's Shares. Such Stockholder has the exclusive power to vote
such Shares.
(d) No Conflict. The execution of this Agreement and the
consummation of the transactions contemplated hereby will not require
notice to, or the consent of, any party to any contract to which such
Stockholder is a party or by which it is bound, or the consent, approval,
order or authorization of, or the registration, declaration or filing with,
any governmental authority, except for those (i) required under the HSR
Act, if any; (ii) required by any Gaming Authority; and (iii) pertaining to
approval by the Pinnacle Board of Directors (which the Stockholders
represent has been granted). Assuming that the notices, consents and
approvals referred to in the preceding sentence have been given, made or
obtained and remain effective, the execution, delivery and performance by
such Stockholder of this Agreement and the consummation of the transactions
contemplated hereby will not (i) violate any Laws, (ii) result in a breach
or violation of any provision of, constitute a default under, or result in
the termination of, or an acceleration of indebtedness or creation of any
Lien under, any contract to which such Stockholder is a party or by which
it is bound or (iii) conflict with or violate any provision of the
organizational or similar documents of such Stockholder.
(e) Brokers, Finders, etc. No broker, investment banker,
financial advisor, finder or other person (other than fees and expenses of
which are the responsibility of PHCR or Pinnacle Acq Corp) is entitled to
any broker's, finder's, financial advisor's or other similar fee or
commission in connection with the transactions contemplated by this
Agreement based upon arrangements made by or on behalf of the Stockholders.
(f) Investment Representations. Each Stockholder:
(i) is an "Accredited Investor," as such term is
defined in Regulation D under the Securities Act of 1933, as amended (the
"Securities Act");
(ii) has had access to such financial and other
information, and has been afforded the opportunity to ask questions of
representatives of PHCR, and to receive answers to those questions, as it
has deemed necessary in connection with its acquisition of PHCR Common
Stock;
(iii) acknowledges that the shares of PHCR Common Stock
that will be acquired pursuant to this Agreement are being acquired in a
transaction not involving any public offering within the meaning of the
Securities Act, and the shares of PHCR Common Stock, have not been, and may
never be, registered under the Securities Act;
(iv) agrees not to offer, sell, transfer or otherwise
dispose of the PHCR Common Stock in the absence of registration under the
Securities Act unless it delivers to PHCR an opinion of counsel reasonably
satisfactory to PHCR, in form and substance satisfactory to
5
PHCR, to the effect that the proposed sale, transfer or other disposition
may be effected without registration under the Securities Act and under
applicable state securities and blue sky laws;
(v) acknowledges that unless and until such PHCR Common
Stock shall have been registered under the Securities Act, the certificates
will bear a legend to the following effect:
THE SECURITIES EVIDENCED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES
ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), OR THE SECURITIES LAWS OF ANY
STATE AND MAY NOT BE SOLD, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE
OF SUCH REGISTRATION, UNLESS THE TRANSFEROR DELIVERS TO THE COMPANY AN OPINION
OF COUNSEL OR OTHER EVIDENCE REASONABLY SATISFACTORY TO THE COMPANY, IN FORM AND
SUBSTANCE SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT THE PROPOSED SALE,
TRANSFER OR OTHER DISPOSITION MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE
SECURITIES ACT AND UNDER APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS.
(vi) has such knowledge and experience in financial and
business matters that it is capable of evaluating the merits and risks of
an acquisition of the PHCR Common Stock and is able to bear the economic
risk of a loss of an investment in the PHCR Common Stock and is not
acquiring any PHCR Common Stock with a view to the distribution thereof or
any present intention of offering or selling any thereof in a transaction
that would violate the Securities Act or the securities laws of any state
or any other applicable jurisdiction; and
(vii) has been advised by its own counsel with respect to
this Agreement and the tax implications of the contributions and
transactions contemplated hereby.
(g) Stockholders Agreement. Such Stockholder has reviewed the
provisions of the Stockholders Agreement, dated as of February 2, 1999 by
and among Harveys, Colony HCR Voteco LLC, a Delaware limited liability
company, Colony Investors III, L.P., a Delaware limited partnership and the
persons listed on Schedule A thereto (the "Colony Stockholders Agreement"),
and acknowledge that such Stockholder shall enter into an agreement with
substantially similar terms (except as may be specified in the MOU) on the
Closing Date, by and among PHCR and the stockholders of PHCR named therein
(the "Stockholders Agreement") and such Stockholder acknowledges that the
PHCR Common Stock to be issued to such Stockholder pursuant to Article III
hereof shall be subject to the Stockholders Agreement.
6
SECTION 4.02. Representations and Warranties of PHCR. PHCR hereby
represents and warrants to each of the Stockholders as follows:
(a) Organization, Standing and Power. PHCR is duly organized,
validly existing and in good standing under the laws of its state of
incorporation, and has all requisite power and authority to enter into and
perform its obligations under this Agreement.
(b) Capitalization. The authorized capital stock of PHCR
consists of 20,000,000 shares of PHCR Class A Common Stock, 20,000,000
shares of PHCR Class B Common Stock and 1,000,000 shares of preferred
stock, par value $.01 per share ("PHCR Preferred Stock"). As of the date
hereof, 1,000 shares of PHCR Class A Common Stock are issued and
outstanding and no shares of PHCR Preferred Stock are issued and
outstanding. Immediately following the Effective Time, the authorized
capital stock of PHCR shall consist of 20,000,000 shares of PHCR Class A
Common Stock, 20,000,000 shares of PHCR Class B Common Stock and 1,000,000
shares of PHCR Preferred Stock. Assuming Pinnacle Merger Consideration of
$24 per share in cash, immediately following the Effective Time, 105,388
shares of PHCR Class A Common Stock, 10,538,798 shares of PHCR Class B
Common Stock and no shares of PHCR Preferred Stock shall be issued and
outstanding; and 11,399 shares of PHCR Class A Common Stock and 1,139,875
shares of PHCR Class B Common Stock shall be reserved for issuance upon
exercise of outstanding employee stock options; provided, that such numbers
do not include any shares of PHCR Class A Common Stock or PHCR Class B
Common Stock which may be issued to holders of Harveys' preferred stock in
lieu of accrued but unpaid dividends; provided further that such numbers
shall be adjusted to take into account any adjustment in the Pinnacle
Merger Consideration pursuant to Section 10.11 of the Merger Agreement.
(c) Authority and Capacity. The execution and delivery of this
Agreement, and the performance by PHCR of its obligations hereunder, have
been duly authorized by all necessary action on the part of PHCR. This
Agreement has been duly executed and delivered on behalf of PHCR and,
assuming the due execution and delivery hereof by the Stockholders and
assuming that approval of this Agreement by Pinnacle remains effective,
this Agreement constitutes a legal, valid and binding obligation of PHCR,
enforceable against PHCR in accordance with its terms.
(d) No Conflict. The execution of this Agreement and the
consummation of the transactions contemplated hereby will not require
notice to, or the consent of, any party to any contract to which PHCR or
any of its affiliates is a party or by which any of them is bound, or the
consent, approval, order or authorization of, or the registration,
declaration or filing with, any governmental authority, except for (i)
those required under the HSR Act, if any, (ii) approvals, as necessary, by
any Gaming Authority, (iii) approval by the Pinnacle Board of Directors
(which the Stockholders represent has been granted); and (iv) as set forth
on Schedule 3.02(c). Assuming that the notices, consents and approvals
----
referred to in the preceding sentence have been given, made or obtained and
remain effective, the
7
execution, delivery and performance by PHCR of this Agreement and the
consummation of the transactions contemplated hereby will not (i) violate
any Laws, (ii) result in a breach or violation of any provision of, or
constitute a default under, any contract to which PHCR is a party or by
which it is bound or (iii) conflict with any provision of the certificate
of incorporation or bylaws of PHCR.
ARTICLE V
COVENANTS
SECTION 5.01. No Solicitation. Each Stockholder agrees that it shall
not, nor shall it authorize or permit any Affiliate, agent, partner or employee
of, or any investment banker, attorney or other advisor or representative of,
such Stockholder to, directly or indirectly, (i) solicit or initiate, or
encourage any inquiries regarding or the submission of, any Takeover Proposal
(including without limitation any proposal or offer to Pinnacle's stockholders)
or (ii) participate in any discussions or negotiations regarding, or furnish to
any person any nonpublic information with respect to, or take any other action
to facilitate the making of any proposal that constitutes, or may reasonably be
expected to lead to, any Takeover Proposal. Notwithstanding the foregoing, a
Stockholder may (A) furnish nonpublic information with respect to Pinnacle to
the person who made such Takeover Proposal and (B) participate in negotiations
with such person regarding such Takeover Proposal, if such Stockholder is
instructed in writing to do so by the Board of Directors of Pinnacle; provided
that it is understood that this Section 5.01 shall not be deemed to have been
violated if in response to an unsolicited inquiry, such Stockholder states
solely that he or she is subject to the limits of this Agreement and provides
only public information in response to such unsolicited inquiry.
SECTION 5.02. No Transfer; No Inconsistent Arrangements. Each
Stockholder agrees that it shall not (including by way of any gift, sale, pledge
or other disposition, including without limitation in connection with
foreclosures by lenders secured by pledges of Shares or Options) (i) transfer,
sell or pledge, encumber, assign or otherwise dispose of, or consent to the
transfer or pledge of, any or all of the Shares or Options owned by it or of any
interest therein, (ii enter into any contract, option or other agreement or
understanding with respect to any such transfer of any such Shares or Options,
or any interest therein or result in the imposition of any Lien, (ii grant any
proxy, power-of-attorney or other authorization in or with respect to any such
Shares or Options, (iv deposit any such Shares or Options into a voting trust or
enter into a voting agreement or arrangement with respect to any such Shares or
Options or (v) take any action that would in any way restrict, limit or
interfere or in any way be inconsistent with the performance of its obligations
hereunder or the transactions contemplated hereby or by the Merger Agreement.
SECTION 5.03. Further Assurances. From time to time, whether before,
at, or after the Closing, each party hereto agrees to execute and deliver, or
cause to be executed and delivered, such additional instruments, certificates
and other documents, and to take such other action, as may
8
be necessary or advisable in order to carry out the terms and provisions of this
Agreement and the transactions contemplated hereby (including voting the Shares
in favor of any such transaction) or to cause the elimination of any
circumstance that would cause a condition under Article V hereof not to be
satisfied on the Closing Date.
SECTION 5.04. Expenses. All fees and expenses incurred in connection
with this Agreement and the transactions contemplated hereby (other than fees
and expenses incurred in connection with obtaining necessary gaming licenses
which shall be paid by Pinnacle) shall be paid by the party incurring such fees
or expenses, whether or not the Merger is consummated.
SECTION 5.05. Publicity. Each Stockholder and PHCR agree that, prior
to the Closing, no public release or announcement concerning this Agreement
shall be issued by any such party without the prior written consent (which
consent shall not be unreasonably withheld) of the other parties hereto, except
as such release or announcement may be required by law (in which event the other
parties hereto shall have the right to comment promptly on the form and content
of the disclosure).
SECTION 5.06. Notice of Certain Events. PHCR and each Stockholder
agrees to notify each other party hereto promptly of (a) any event or condition
that, with or without notice or lapse of time, would or could reasonably be
expected to cause any of the representations and warranties made by such party
herein to be no longer complete and accurate as of any date on or before the
Closing Date, or (b) any failure, with or without notice or lapse of time, on
the part of such party to comply with any of the covenants or agreements on its
part contained herein at any time on or before the Closing Date.
SECTION 5.07. ▇.▇. ▇▇▇▇▇▇▇ Approval Right. From the date hereof
until the Effective Time or earlier termination of this Agreement, ▇.▇. ▇▇▇▇▇▇▇
shall have the right to reasonably approve any equity investment in, or material
acquisition by, Holding, Pinnacle Acq Corp, Harveys or any of their respective
subsidiaries; provided that ▇▇. ▇▇▇▇▇▇▇ shall consider any request to take such
actions in good faith and such approval shall not be unreasonably withheld.
SECTION 5.08. Sale of ▇▇▇▇▇▇▇ Shares. Immediately prior to the
Effective Time, ▇▇. ▇▇▇▇▇▇▇ shall sell to Pinnacle, and Pinnacle shall purchase
from ▇▇. ▇▇▇▇▇▇▇, the shares of Pinnacle Common Stock owned by ▇▇. ▇▇▇▇▇▇▇ on
the date hereof that are not Shares Contributed (the "▇▇▇▇▇▇▇ Shares") for a
price equal to the Pinnacle Merger Consideration (including a contingent payment
right on terms substantially identical to that being received by Pinnacle's
stockholders under Section 10.11 of the Merger Agreement), if any, that would be
payable at the Effective Time in respect of the ▇▇▇▇▇▇▇ Shares. ▇▇. ▇▇▇▇▇▇▇
shall use commercially reasonable efforts to obtain a comparable economic and
tax position with respect to the sale of the ▇▇▇▇▇▇▇ Shares if, for any reason,
PHCR does not redeem the ▇▇▇▇▇▇▇ Shares. In connection with implementing its
financing, PHCR and Pinnacle Acq Corp shall use their commercially reasonable
efforts to secure elimination of covenants in Indentures governing Pinnacle's
public debt and
9
waivers from its banks under the Bank Credit Facility which would prohibit or
limit Pinnacle's ability to effectuate the purchase of the ▇▇▇▇▇▇▇ Shares as
contemplated herein.
ARTICLE VI
CONDITIONS PRECEDENT TO
OBLIGATIONS UNDER ARTICLE III
SECTION 6.01. Stockholders' Conditions. The obligation of each of
the Stockholders pursuant to Article III shall be subject to the satisfaction or
waiver on the Closing Date of each of the following conditions precedent:
(a) No Injunctions or Restraints. No temporary restraining order
or preliminary or permanent injunction of any court or administrative
agency of competent jurisdiction prohibiting the transactions contemplated
by this Agreement shall be in effect.
(b) No Violation of Law. The performance of the obligations of
each of the Stockholders pursuant to Article III shall not constitute a
violation of any Laws.
(c) Representations and Warranties. The representations and
warranties of PHCR set forth in this Agreement shall be true and correct in
all material respects on and as of the Closing Date an as of the date
hereof, as though made on and as of the Closing Date.
(d) Covenants and Agreements. PHCR shall have performed, in all
material respects, all obligations and complied, in all material respects,
with all covenants required by this Agreement to be performed or complied
with it at or prior to the Closing Date.
(e) Merger Agreement. Each of the conditions to closing
contained in the Merger Agreement (other than the consummation of the
transactions contemplated by this Agreement) shall have been satisfied or
waived.
(f) Certificates for PHCR Common Stock. PHCR shall have
delivered to each Stockholder certificates representing shares of PHCR
Common Stock, free and clear of all Liens or other adverse interests
(including any restriction on the right to vote, sell or otherwise dispose
of the PHCR Common Stock).
(g) Stockholders Agreement. PHCR shall have executed and
delivered the Stockholders Agreement to the Stockholders.
10
(h) Purchase of ▇▇▇▇▇▇▇ Shares. The ▇▇▇▇▇▇▇ Shares shall have
been redeemed by Pinnacle for an amount equal to the Pinnacle Merger
Consideration (including a contingent payment right on terms substantively
identical to that being received by Pinnacle's stockholders under Section
10.11 of the Merger Agreement) so that after such redemption his percentage
ownership interest in Pinnacle, including any ownership arising from the
exercise of stock options held by him and any other shares the ownership of
which is attributed to him under section 318 of the Internal Revenue Code
of 1986, as amended, is less than 80% of such percentage ownership interest
prior to such redemption, or, in his good faith determination, ▇▇. ▇▇▇▇▇▇▇
shall have obtained a comparable economic and tax position with respect to
the sale of the ▇▇▇▇▇▇▇ Shares.
SECTION 6.02. PHCR's Conditions. The obligation of PHCR pursuant to
Article III shall be subject to the satisfaction or waiver on the Closing Date
of each of the following conditions precedent:
(a) No Injunctions or Restraints. No temporary restraining order
or preliminary or permanent injunction of any court or administrative
agency of competent jurisdiction prohibiting the transactions contemplated
by this Agreement shall be in effect.
(b) No Violation of Law. The performance of the obligations of
PHCR pursuant to Article III shall not constitute a violation of any Laws.
(c) Representations and Warranties. The representations and
warranties of the Stockholders set forth in this Agreement shall be true
and correct in all material respects on and as of the Closing Date, as
though made on and as of the Closing Date.
(d) Covenants and Agreements. Each of the Stockholders shall
have performed, in all material respects, all obligations and complied, in
all material respects, with all covenants required by this Agreement to be
performed or complied with it at or prior to the Closing Date.
(e) Merger Agreement. Each of the conditions to closing
contained in the Merger Agreement (other than the consummation of the
transactions contemplated by this Agreement) shall have been satisfied or
waived.
(f) Certificates for Shares. Each Stockholder shall have
delivered to PHCR certificates representing its Shares with all necessary
indorsements, free and clear of all Liens or other adverse interests
(including any restriction on the right to vote, sell or otherwise dispose
of such Shares).
(g) Stockholders Agreement. Each Stockholder shall have executed
and delivered the Stockholders Agreement to PHCR.
11
ARTICLE VII
TERMINATION, AMENDMENT AND INDEMNIFICATION
SECTION 7.01. Termination. This Agreement shall terminate without
any further action on the part of PHCR or any of the Stockholders (i) if the
Closing has occurred, (ii) if the Merger has been consummated in accordance with
the terms of the Merger Agreement, or (iii) if the Merger Agreement has been
terminated in accordance with Article 9 thereunder.
SECTION 7.02. Effect of Termination. In the event this Agreement
shall have been terminated in accordance with Section 7.01 of this Agreement,
this Agreement shall forthwith become void and have no effect, without any
liability or obligation on the part of any party hereto, except to the extent
that such termination results from the wilful and material breach by a party of
any of its representations, warranties, covenants or agreements set forth in
this Agreement, in which case each other party shall be entitled to recover all
damages allowable at law and all relief available in equity, subject, however,
to the limitation in Section 9.2 of the Merger Agreement.
SECTION 7.03. Amendment. This Agreement and the Schedules and
Exhibits hereto may not be amended except by an instrument or instruments in
writing signed and delivered on behalf of each of the parties hereto. At any
time prior to the Closing Date, any party hereto which is entitled to the
benefits hereof may (a) extend the time for the performance of any of the
obligations or other acts of any other party, (b) waive any inaccuracy in the
representations and warranties of any other party contained herein, in any
Schedule and Exhibit hereto, or in any document delivered pursuant hereto, and
(c), subject to applicable law, waive compliance with any of the agreements of
any other party hereto or any conditions contained herein. Any agreement on the
part of any of the parties hereto to any such extension or waiver (i) shall be
valid only if set forth in an instrument in writing signed and delivered on
behalf of each such party, and (ii) shall not be construed as a waiver or
extension of any subsequent breach or time for performance hereunder.
ARTICLE VII
MISCELLANEOUS
SECTION 8.01. Notices. All notices, requests, claims, demands and
other communications under this Agreement shall be in writing and shall be
deemed given if delivered personally or sent by overnight courier (providing
proof of delivery) to the parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
(a) if to PHCR, to:
c/o Colony Capital, Inc.
1999 Avenue of the Stars, ▇▇▇▇▇ ▇▇▇▇
▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: 310-843-3663
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
with a copy to:
Skadden, Arps, Slate, ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: ▇▇▇-▇▇▇-▇▇▇▇
Facsimile: 213-687-5600
(b) if to the Stockholders, to the addresses set forth on the
books and records of Pinnacle.
SECTION 8.02. Interpretation. When a reference is made in this
Agreement to an Article, Section or Schedule, such reference shall be to an
Article, Section or Schedule of this Agreement, unless otherwise indicated. The
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this Agreement. Whenever
the words "include," "includes" or "including" are used in this Agreement, they
shall be deemed to be followed by the words "without limitation." The Merger
Agreement and the consummation of the transactions contemplated by such Merger
Agreement are transactions contemplated by this Agreement. To the extent any
restriction on the activities of Pinnacle or its subsidiaries under the terms of
this Agreement requires prior approval under any Gaming Law, such restriction
shall be of no force or effect unless and until such approval is obtained. If
any provision of this Agreement is illegal or unenforceable under any Gaming
Law, such provision shall be void and of no force or effect.
SECTION 8.03. Severability. If any provision of this Agreement or
the application of any such provision shall be held invalid, illegal or
unenforceable in any respect by a court of competent jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
hereof. In lieu of any such invalid, illegal or unenforceable provision, the
parties hereto intend that there shall be added as part of this Agreement a
valid, legal and enforceable provision as similar in terms to such invalid,
illegal or unenforceable provision as may be possible or practicable under the
circumstances.
SECTION 8.04. Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other parties.
13
SECTION 8.05. Entire Agreement; No Third-Party Beneficiaries. This
Agreement, the MOU, the Merger Agreement, and the Schedules and Exhibits
thereto, constitute the entire agreements, and supersede all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter of these agreements and neither this Agreement nor the Merger
Agreement, is intended to confer upon any person other than the parties any
rights or remedies thereunder.
SECTION 8.06. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY,
AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF DELAWARE, WITHOUT
REGARD TO ANY APPLICABLE CONFLICTS OF LAW AND EXCEPT THAT GAMING LAWS SHALL BE
GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE RESPECTIVE
JURISDICTIONS IN WHICH APPROVALS FROM GAMING AUTHORITIES ARE REQUIRED TO BE
OBTAINED.
SECTION 8.07. Gaming Laws. Each of the provisions of this Agreement
is subject to and shall be enforced in compliance with the Gaming Laws.
SECTION 8.08. Assignment. Neither this Agreement nor any of the
rights, interests or obligations under this Agreement shall be assigned, in
whole or in part, by operation of law or otherwise by any of the parties without
the prior written consent of the other parties, except that PHCR may assign, in
its sole discretion and without any Stockholder's consent, any of or all its
rights, interests and obligations under this Agreement to any controlled
affiliate of Colony Capital, Inc., but no such assignment shall relieve PHCR of
any of its obligations under this Agreement. Subject to the preceding sentence,
this Agreement will be binding upon, inure to the benefit of, and be enforceable
by, the parties and their respective successors and assigns.
SECTION 8.09. Enforcement. The parties agree that irreparable damage
would occur in the event that any of the provisions of this Agreement were not
performed in accordance with their specific terms or were otherwise breached. It
is accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any court of the United States
located in the State of Delaware or in any Delaware state court, this being in
addition to any other remedy to which they are entitled at law or in equity. In
addition, each of the parties hereto (a) consents to submit itself to the
personal jurisdiction of any Federal court located in the State of Delaware or
any Delaware state court in the event any dispute arises out of this Agreement
or any of the transactions contemplated by this Agreement, (b) agrees that it
will not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any such court and (c) agrees that it will not bring any
action relating to this Agreement or any of the transactions contemplated by
this Agreement in any court other than a Federal or state court sitting in the
State of Delaware.
SECTION 8.10. Stockholder Capacity. Notwithstanding anything herein
to the contrary, the Stockholders enter into this Agreement solely in their
respective capacities as stockholders of Pinnacle. No person executing this
Agreement who is or becomes a director or
14
officer of Pinnacle shall be deemed to make any agreement herein in his or her
capacity as director or officer of Pinnacle. Nothing herein shall limit or
affect (a) actions taken by any Stockholder in his or her capacity as director
or officer of Pinnacle or (b) the rights and remedies PHCR may have other than
pursuant to this Agreement in respect of such conduct undertaken in the capacity
of director or officer of Pinnacle.
[signature pages follow]
15
IN WITNESS WHEREOF, each of the parties hereto has caused its duly
authorized officers to execute this Voting and Contribution Agreement as of the
date first above written.
PH CASINO RESORTS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
--------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
STOCKHOLDERS
/s/ ▇.▇. ▇▇▇▇▇▇▇
------------------------------------------
▇. ▇. ▇▇▇▇▇▇▇
/s/ G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
------------------------------------------
G. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇ ▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇
/s/ J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
------------------------------------------
J. ▇▇▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
------------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
___________________________________________
▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
/s/ ▇▇▇▇▇ ▇▇▇▇▇
___________________________________________
▇▇▇▇▇ ▇▇▇▇▇
/s/ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
___________________________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
17